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<!-- Field: Rule-Page --><DIV STYLE="margin-top: 1pt; margin-bottom: 1pt; width: 100%"><DIV STYLE="font-size: 1pt; border-top: black 2.25pt solid">&nbsp;</DIV></DIV><!-- Field: /Rule-Page -->

<P STYLE="font: 12pt Times New Roman, Times, Serif; margin: 0; text-align: center">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><B>UNITED STATES</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><B>SECURITIES AND EXCHANGE COMMISSION</B> &nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><B>WASHINGTON, D.C. 20549</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><B>FORM S-8</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><B>REGISTRATION STATEMENT UNDER THE SECURITIES
ACT OF 1933</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><FONT STYLE="text-transform: uppercase">&nbsp;</FONT></P>

<P STYLE="font: 12pt Times New Roman, Times, Serif; margin: 0; text-align: center"><FONT STYLE="font-size: 10pt; text-transform: uppercase"><B><U>SPLASH
BEVERAGE GROUP, INC.</U></B></FONT></P>



<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center">(Exact name of issuer as specified in its charter)</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center">&nbsp;</P>

<TABLE CELLSPACING="0" CELLPADDING="0" STYLE="font: 12pt Times New Roman, Times, Serif; width: 100%; border-collapse: collapse">
<TR STYLE="vertical-align: top">
    <TD STYLE="width: 50%; border-bottom: black 1.5pt solid; text-align: center"><FONT STYLE="font-size: 10pt"><B>Colorado</B></FONT></TD>
    <TD STYLE="width: 1%; padding-bottom: 1.5pt">&nbsp;</TD>
    <TD STYLE="width: 49%; border-bottom: black 1.5pt solid; text-align: center"><FONT STYLE="font-size: 10pt"><B><U>34-1720075</U></B></FONT></TD></TR>
<TR STYLE="vertical-align: top">
    <TD STYLE="text-align: center"><FONT STYLE="font-size: 10pt">(State or other jurisdiction of</FONT></TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: center"><FONT STYLE="font-size: 10pt">(I.R.S. Employer</FONT></TD></TR>
<TR STYLE="vertical-align: top">
    <TD STYLE="text-align: center"><FONT STYLE="font-size: 10pt">incorporation or organization)</FONT></TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: center"><FONT STYLE="font-size: 10pt">Identification No.)</FONT></TD></TR>
</TABLE>
<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><B>&nbsp;</B></P>

<TABLE CELLSPACING="0" CELLPADDING="0" STYLE="font: 12pt Times New Roman, Times, Serif; width: 100%; border-collapse: collapse">
<TR>
    <TD STYLE="vertical-align: top; width: 50%; border-bottom: black 1.5pt solid">
        <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><B>1314 E Las Olas Blvd.</B></P>
        <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><B>Suite 221</B></P>
        <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><B>Fort Lauderdale, FL</B></P></TD>
    <TD STYLE="vertical-align: bottom; width: 1%">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom; width: 49%; border-bottom: black 1.5pt solid; text-align: center"><FONT STYLE="font-size: 10pt"><B>33301</B></FONT></TD></TR>
<TR>
    <TD STYLE="vertical-align: top; text-align: center"><FONT STYLE="font-size: 10pt"><B>(Address of principal executive offices)</B></FONT></TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: top; text-align: center"><FONT STYLE="font-size: 10pt"><B>(Zip Code)</B></FONT></TD></TR>
</TABLE>
<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><B><BR>
SPLASH BEVERAGE GROUP, INC.</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><B>2020 LONG-TERM INCENTIVE COMPENSATION PLAN</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center">(Full&nbsp;title of the plan)</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><B>Robert Nistico </B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><B>Chief Executive Officer </B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><B>Canfield Medical Supply, Inc. </B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><B>1314 E Las Olas Blvd.</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><B>Suite 221</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><B></B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><B>Fort Lauderdale, Florida 33301</B></P>
<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><B></B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center">(Name and address of agent for service)</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><B>&nbsp;</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><B>(954) 745-5815</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center">(Telephone number, including area code, of agent
for service)</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><B>&nbsp;</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><B>Copies to:</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><B>&nbsp;</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><B>Darrin M. Ocasio, Esq.</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><B>Sichenzia Ross Ference LLP</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><B>1185 Avenue of the Americas, 37<SUP>th</SUP>&nbsp;Floor</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><B>New York, New York 10036</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><B>Telephone: (212) 930-9700</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><B>Fax Number: (212) 930-9725</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">Indicate by check mark whether the registrant is a large accelerated
filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company or an emerging growth company. See the definitions
of &ldquo;large accelerated filer,&rdquo; &ldquo;accelerated filer,&rdquo; &ldquo;smaller reporting company,&rdquo; and &quot;emerging
growth company&quot; in Rule 12b-2 of the Exchange Act.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<TABLE CELLSPACING="0" CELLPADDING="0" STYLE="font: 12pt Times New Roman, Times, Serif; width: 100%; border-collapse: collapse">
<TR STYLE="vertical-align: top">
    <TD STYLE="width: 50%; text-align: center"><FONT STYLE="font-size: 10pt">Large accelerated filer &#9744;</FONT></TD>
    <TD STYLE="width: 50%; text-align: center"><FONT STYLE="font-size: 10pt">Accelerated filer &#9744;</FONT></TD></TR>
<TR STYLE="vertical-align: top">
    <TD STYLE="text-align: center"><FONT STYLE="font-size: 10pt">Non-accelerated filer &#9746;</FONT></TD>
    <TD>
        <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center">Smaller reporting company &#9746;</P>
        <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center">Emerging Growth Company &#9744;</P>
        <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center">&nbsp;</P></TD></TR>
</TABLE>
<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">If an emerging growth company, indicate by
check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial
accounting standards provided pursuant to Section 7(a)(2)(B) of the Securities Act. &#9744;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><B>CALCULATION OF REGISTRATION FEE</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-indent: 290.25pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</P>

<TABLE CELLSPACING="0" CELLPADDING="0" STYLE="font: 12pt Times New Roman, Times, Serif; width: 100%; border-collapse: collapse">
<TR STYLE="vertical-align: bottom">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD COLSPAN="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD COLSPAN="2" STYLE="text-align: center"><FONT STYLE="font-size: 10pt">Proposed Maximum </FONT></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD COLSPAN="2" STYLE="text-align: center"><FONT STYLE="font-size: 10pt">Proposed Maximum </FONT></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD COLSPAN="2" STYLE="text-align: center">&nbsp;</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD STYLE="text-align: center"><FONT STYLE="font-size: 10pt">Title of Securities</FONT></TD>
    <TD>&nbsp;</TD>
    <TD COLSPAN="2" STYLE="text-align: center"><FONT STYLE="font-size: 10pt">Amount To Be</FONT></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD COLSPAN="2" STYLE="text-align: center"><FONT STYLE="font-size: 10pt">Offering Price Per</FONT></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD COLSPAN="2" STYLE="text-align: center"><FONT STYLE="font-size: 10pt">Aggregate Offering </FONT></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD COLSPAN="2" STYLE="text-align: center"><FONT STYLE="font-size: 10pt">Amount of registration </FONT></TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD STYLE="border-bottom: black 1.5pt solid; padding-bottom: 1.5pt; text-align: center"><FONT STYLE="font-size: 9pt">to be Registered</FONT></TD>
    <TD STYLE="padding-bottom: 1.5pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="border-bottom: black 1.5pt solid; text-align: center"><FONT STYLE="font-size: 10pt">Registered(1)</FONT></TD>
    <TD STYLE="padding-bottom: 1.5pt">&nbsp;</TD>
    <TD STYLE="padding-bottom: 1.5pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="border-bottom: black 1.5pt solid; text-align: center"><FONT STYLE="font-size: 10pt">Share</FONT></TD>
    <TD STYLE="padding-bottom: 1.5pt">&nbsp;</TD>
    <TD STYLE="padding-bottom: 1.5pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="border-bottom: black 1.5pt solid; text-align: center"><FONT STYLE="font-size: 10pt">Price(2)</FONT></TD>
    <TD STYLE="padding-bottom: 1.5pt">&nbsp;</TD>
    <TD STYLE="padding-bottom: 1.5pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="border-bottom: black 1.5pt solid; text-align: center"><FONT STYLE="font-size: 10pt">fee</FONT></TD>
    <TD STYLE="padding-bottom: 1.5pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD STYLE="text-align: center">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD COLSPAN="2" STYLE="text-align: center">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD COLSPAN="2" STYLE="text-align: center">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD COLSPAN="2" STYLE="text-align: center">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD COLSPAN="2" STYLE="text-align: center">&nbsp;</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: #CCEEFF">
    <TD STYLE="padding-bottom: 2.5pt; width: 52%"><FONT STYLE="font-size: 10pt">Common Stock, $0.001 par value per share</FONT></TD>
    <TD STYLE="padding-bottom: 2.5pt; width: 1%">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; width: 1%">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; width: 9%; text-align: right"><FONT STYLE="font-size: 10pt">6,939,398</FONT></TD>
    <TD STYLE="padding-bottom: 2.5pt; width: 1%">&nbsp;</TD>
    <TD STYLE="padding-bottom: 2.5pt; width: 1%">&nbsp;</TD>
    <TD STYLE="padding-bottom: 2.5pt; width: 1%">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; width: 9%; text-align: right"><FONT STYLE="font-size: 10pt">0.46</FONT></TD>
    <TD STYLE="padding-bottom: 2.5pt; width: 1%">&nbsp;</TD>
    <TD STYLE="padding-bottom: 2.5pt; width: 1%">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; width: 1%">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; width: 9%; text-align: center"><FONT STYLE="font-size: 10pt">$3,192,123.08</FONT></TD>
    <TD STYLE="padding-bottom: 2.5pt; width: 1%">&nbsp;</TD>
    <TD STYLE="padding-bottom: 2.5pt; width: 1%">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; width: 1%">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; width: 9%; text-align: right"><FONT STYLE="font-family: inherit,serif; font-size: 9pt">$414.34</FONT><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="padding-bottom: 2.5pt; width: 1%">&nbsp;</TD></TR>
</TABLE>
<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; color: white">&nbsp;&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">(1) Pursuant to Rule 416 promulgated under
the Securities Act of 1933, as amended, (the &ldquo;Securities Act&rdquo;) this registration statement also covers an indeterminate
amount of interests to be offered or sold pursuant to the employee benefit plan(s) described herein.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">(2) Estimated solely for purposes of calculating
the registration fee in accordance with Rules 457(c) and 457(h)(1) under the Securities Act using the average of the high and low
prices per share of the Registrant&rsquo;s Common Stock as reported on the OTC Market on June 3, 2019, which date is within five
business days prior to filing this Registration Statement,.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">&nbsp;</P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><B>PART 1</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><B>INFORMATION REQUIRED IN THE SECTION 10(a)
PROSPECTUS</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0"><B>ITEM 1. PLAN INFORMATION.</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="text-align: justify; font: 10pt Times New Roman, Times, Serif; margin: 0">Splash Beverage Group, Inc. (previously, &ldquo;Canfield Medical
Supply, Inc.&rdquo;) (&quot;we&quot;, &quot;us&quot;, &quot;our&quot;, the &ldquo;Company&rdquo;, &ldquo;Splash&rdquo; or &quot;Canfield&quot;)
will provide each participant (the &quot;Recipient&quot;) with documents that contain information related to the Splash Beverage
Group, Inc. 2020 Long-Term Incentive Compensation Plan, and other information including, but not limited to, the disclosure required
by Item 1 of Form S-8, which information is not filed as a part of this Registration Statement on Form S-8 (the &quot;Registration
Statement&quot;). The foregoing information and the documents incorporated by reference in response to Item 3 of Part II of this
Registration Statement taken together constitute a prospectus that meets the requirements of Section 10(a) of the Securities Act.
A Section 10(a) prospectus will be given to each Recipient who receives common shares covered by this Registration Statement, in
accordance with Rule 428(b)(1) under the Securities Act.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0"><B>ITEM 2. REGISTRANT INFORMATION AND EMPLOYEE PLAN ANNUAL INFORMATION.</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">We will provide to each Recipient a written
statement advising them of the availability of documents incorporated by reference in Item 3 of Part II of this Registration Statement
(which documents are incorporated by reference in this Section 10(a) prospectus) and of documents required to be delivered pursuant
to Rule 428(b) under the Securities Act without charge and upon written or oral notice by contacting:</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center">Dean Huge, Chief Financial Officer</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center">Splash Beverage Group, Inc.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center">1314 E Las Olas Blvd.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center">Suite 221</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center">Fort Lauderdale, Florida 33316</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center">(954) 745-5815</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">INFORMATION REQUIRED BY PART I TO BE CONTAINED
IN SECTION 10(a) PROSPECTUS IS OMITTED FROM THE REGISTRATION STATEMENT IN ACCORDANCE WITH RULE 428 UNDER THE SECURITIES ACT OF
1933, AND NOTE TO PART I OF FORM S-8.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><B>PART II&nbsp;</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><B>INFORMATION NOT REQUIRED IN THE REGISTRATION
STATEMENT</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0"><B>ITEM 3. INCORPORATION OF DOCUMENTS BY REFERENCE.</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">The Securities and Exchange Commission (&ldquo;SEC&rdquo;)
allows us to &ldquo;incorporate by reference&rdquo; information into this prospectus. The Registrant hereby incorporates by reference
into this Registration Statement the documents listed below. In addition, all documents subsequently filed pursuant to Sections
13(a), 13(c), 14 and 15(d) of the Exchange Act prior to the filing of a post-effective amendment which indicates that all securities
offered have been sold or which deregisters all securities then remaining unsold, shall be deemed to be incorporated by reference
into this Registration Statement and to be a part hereof from the date of filing of such documents.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0.5in">(a)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Our
Annual Report on Form 10-K for the year ended December 31, 2019 filed with the SEC on March 27, 2020;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0.5in">(b) &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Our Quarterly Report on Form 10-Q and 10-Q/A, as amended, for the
quarterly period ended March 31, 2020 filed with the SEC on May 13, 2020 and May 14, 2020, respectively, and Quarterly Report on
Form 10-Q for the quarter ended June 30, 2020, filed with the Commission on August 13, 2020;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0.5in">(c) &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Our
Current Reports on Form 8-K or 8-K/A filed with the SEC on January 7, 2020, April 6, 2020, April 17, 2020, April 22, 2020, May
7, 2020 and May 29, 2020;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0.5in">(d)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;All
other reports filed pursuant to Section 13(a) or 15(d) of the Exchange Act since the end of the fiscal year covered by the Registrant&rsquo;s
latest&nbsp;annual report&nbsp;or&nbsp;prospectus&nbsp;referred to in (a) above; and</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0.5in">(e) &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
description of the Registrant&rsquo;s Common Stock incorporated herein by reference from the Company&rsquo;s Registration Statement
on&nbsp;Form 8-A, filed with the Securities and Exchange Commission December 13, 2020.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">&nbsp;</P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">&nbsp;</P>


<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt; font-variant: small-caps"></FONT></P>


<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0"><FONT STYLE="font: small-caps 10pt Times New Roman, Times, Serif"><B>&nbsp;</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0"><FONT STYLE="font: small-caps 10pt Times New Roman, Times, Serif"><B>&nbsp;</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt; text-align: center"><FONT STYLE="font: 14pt Times New Roman, Times, Serif"><B>Splash
Beverage Group, Inc.</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt; text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B>&nbsp;</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt; text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B>Consolidated
Financial Statements</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt; text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B>&nbsp;</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt; text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt; text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B>December
31, 2019 and 2018</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; text-align: center; margin-top: 0pt; margin-bottom: 0pt">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B>&nbsp;</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B><U>Table
of Contents</U></B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;&nbsp;</FONT></P>

<TABLE CELLSPACING="0" CELLPADDING="0" STYLE="font: 10pt Times New Roman, Times, Serif; width: 100%; border-collapse: collapse">
<TR STYLE="vertical-align: top; background-color: rgb(204,238,255)">
    <TD STYLE="width: 91%"><A HREF="#a_023"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">Reports of Independent Registered
    Public Accounting Firms</FONT></A></TD>
    <TD STYLE="width: 9%; text-align: center">F-2 - F-3</TD></TR>
<TR STYLE="vertical-align: top; background-color: White">
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: center">&nbsp;</TD></TR>
<TR STYLE="vertical-align: top; background-color: rgb(204,238,255)">
    <TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif">Financial Statements</FONT></TD>
    <TD STYLE="text-align: center">&nbsp;</TD></TR>
<TR STYLE="vertical-align: top; background-color: White">
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: center">&nbsp;</TD></TR>
<TR STYLE="vertical-align: top; background-color: rgb(204,238,255)">
    <TD STYLE="padding-left: 0.125in"><A HREF="#Fin_001"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">Consolidated
    Balance Sheets</FONT></A></TD>
    <TD STYLE="text-align: center">F-<FONT STYLE="font: 10pt Times New Roman, Times, Serif">4</FONT></TD></TR>
<TR STYLE="vertical-align: top; background-color: White">
    <TD STYLE="padding-left: 0.125in">&nbsp;</TD>
    <TD STYLE="text-align: center">&nbsp;</TD></TR>
<TR STYLE="vertical-align: top; background-color: rgb(204,238,255)">
    <TD STYLE="padding-left: 0.125in"><A HREF="#Fin_002"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">Consolidated
    Statements of Operations</FONT></A></TD>
    <TD STYLE="text-align: center">F-<FONT STYLE="font: 10pt Times New Roman, Times, Serif">5</FONT></TD></TR>
<TR STYLE="vertical-align: top; background-color: White">
    <TD>&nbsp;</TD>
    <TD STYLE="padding-left: 0.125in; text-align: center">&nbsp;</TD></TR>
<TR STYLE="vertical-align: top; background-color: rgb(204,238,255)">
    <TD STYLE="padding-left: 0.125in"><A HREF="#Fin_003"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">Consolidated
    Statements of Changes in Deficiency in Stockholders&rsquo; Equity</FONT></A></TD>
    <TD STYLE="text-align: center">F-<FONT STYLE="font: 10pt Times New Roman, Times, Serif">6</FONT></TD></TR>
<TR STYLE="vertical-align: top; background-color: White">
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: center">&nbsp;</TD></TR>
<TR STYLE="vertical-align: top; background-color: rgb(204,238,255)">
    <TD STYLE="padding-left: 0.125in"><A HREF="#Fin_004"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">Consolidated
    Statements of Cash Flows</FONT></A></TD>
    <TD STYLE="text-align: center">F-<FONT STYLE="font: 10pt Times New Roman, Times, Serif">7</FONT></TD></TR>
<TR STYLE="vertical-align: top; background-color: White">
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: center">&nbsp;</TD></TR>
<TR STYLE="vertical-align: top; background-color: rgb(204,238,255)">
    <TD><A HREF="#Fin_005"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">Notes to the Consolidated
    Financial Statements</FONT></A></TD>
    <TD STYLE="text-align: center">F-8<FONT STYLE="font: 10pt Times New Roman, Times, Serif"> &ndash; F-27</FONT></TD></TR>
</TABLE>


<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; text-align: center; margin-top: 0pt; margin-bottom: 0pt">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; text-align: center; margin-top: 0pt; margin-bottom: 0pt">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B>&nbsp;</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"></P>

<TABLE CELLSPACING="0" CELLPADDING="0" STYLE="width: 100%; border-collapse: collapse">
<TR STYLE="vertical-align: top">
    <TD STYLE="font: 9pt/107% Arial, Helvetica, Sans-Serif; width: 100%; padding-bottom: 8pt"></TD></TR>
</TABLE>
<P STYLE="font: 9pt/107% Arial, Helvetica, Sans-Serif; margin: 0 0 8pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;<IMG SRC="image_001.gif" ALT=""></FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%">
<TR>
    <TD><BR>
<P STYLE="font: 7pt/9pt Arial, Helvetica, Sans-Serif; margin: 0 0 6pt; letter-spacing: -0.05pt"><FONT STYLE="font: small-caps 10pt Times New Roman, Times, Serif"><B>grant
        thornton llp</B><BR>
        </FONT><FONT STYLE="font: small-caps 7pt Times New Roman, Times, Serif">101 E KENNEDY
        BLVD, SUITE 3850<BR>
        TAMPA, FL 33602</FONT></P>
        <P STYLE="font: 6pt/9pt GT Walsheim Regular; margin: 0 0 6pt; letter-spacing: -0.05pt"><FONT STYLE="font: 7pt Times New Roman, Times, Serif">D
        +1 813 229 7201<BR>
        F +1 813 223 3015</FONT></P></TD></TR>
</TABLE>
<P STYLE="margin: 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt/normal Arial, Helvetica, Sans-Serif; text-align: center; margin-top: 0; margin-bottom: 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><BR STYLE="clear: both">
<B><A NAME="a_023" TITLE="REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM  2018"></A>REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM</B></FONT></P>

<P STYLE="font: 10pt/normal Arial, Helvetica, Sans-Serif; margin: 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"></FONT></P>

<P STYLE="font: 9pt/107% Arial, Helvetica, Sans-Serif; margin: 0 0 8pt">&nbsp;</P>

<P STYLE="font: 9pt/107% Arial, Helvetica, Sans-Serif; margin: 0 0 8pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">Board
of Directors and Shareholders</FONT></P>

<P STYLE="font: 10pt/normal Arial, Helvetica, Sans-Serif; margin: 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">Splash
Beverage Group, Inc. (formerly Canfield Medical Supply, Inc.)</FONT></P>

<P STYLE="font: 10pt/normal Arial, Helvetica, Sans-Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt/normal Arial, Helvetica, Sans-Serif; margin: 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B>Opinion
on the financial statements </B></FONT></P>

<P STYLE="font: 10pt/normal Arial, Helvetica, Sans-Serif; margin: 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">We
have audited the accompanying consolidated balance sheet of Splash Beverage Group, Inc. (a Colorado corporation) and subsidiaries
(the &ldquo;Company&rdquo;) as of December 31, 2018, the related consolidated statements of operations, changes in deficiency
in stockholders&rsquo; equity, and cash flows for the year ended December 31, 2018, and the related notes (collectively referred
to as the &ldquo;financial statements&rdquo;). In our opinion, the financial statements present fairly, in all material respects,
the financial position of the Company as of December 31, 2018, and the results of its operations and its cash flows for the year
ended December 31, 2018, in conformity with accounting principles generally accepted in the United States of America.</FONT></P>

<P STYLE="font: 9pt/14pt Arial, Helvetica, Sans-Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 9pt/14pt Arial, Helvetica, Sans-Serif; margin: 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B>Going
concern</B></FONT></P>

<P STYLE="font: 10pt/normal Arial, Helvetica, Sans-Serif; margin: 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">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 incurred a net loss of approximately $3.8 million during the year ended December
31, 2018. This condition, along with other matters as set forth in Note 3, raise substantial doubt about the Company&rsquo;s ability
to continue as a going concern.&nbsp; Management&rsquo;s plans in regards to these matters are also described in Note 3. The financial
statements do not include any adjustments that might result from the outcome of this uncertainty.</FONT></P>

<P STYLE="font: 9pt/14pt Arial, Helvetica, Sans-Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 9pt/14pt Arial, Helvetica, Sans-Serif; margin: 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B>Basis
for opinion </B></FONT></P>

<P STYLE="font: 10pt/normal Arial, Helvetica, Sans-Serif; margin: 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">These
financial statements are the responsibility of the Company&rsquo;s management. Our responsibility is to express an opinion on
the Company&rsquo;s financial statements based on our audit. We are a public accounting firm registered with the Public Company
Accounting Oversight Board (United States) (&ldquo;PCAOB&rdquo;) 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.</FONT></P>

<P STYLE="font: 9pt/107% Arial, Helvetica, Sans-Serif; margin: 0 0 8pt">&nbsp;</P>

<P STYLE="font: 10pt/normal Arial, Helvetica, Sans-Serif; margin: 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">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&rsquo;s internal control over financial reporting.
Accordingly, we express no such opinion.</FONT></P>

<P STYLE="font: 10pt/normal Arial, Helvetica, Sans-Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt/normal Arial, Helvetica, Sans-Serif; margin: 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">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.</FONT></P>



<P STYLE="font: 10pt/normal Arial, Helvetica, Sans-Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">/s/ GRANT THORNTON LLP</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt/normal Arial, Helvetica, Sans-Serif; margin: 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">We
served as the Company&rsquo;s auditor from 2018 to 2019.</FONT></P>

<P STYLE="font: 10pt/normal Arial, Helvetica, Sans-Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt/normal Arial, Helvetica, Sans-Serif; margin: 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">Tampa,
Florida</FONT></P>

<P STYLE="font: 10pt/normal Arial, Helvetica, Sans-Serif; margin: 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">August
18, 2020</FONT></P>

<P STYLE="font: 10pt/normal Arial, Helvetica, Sans-Serif; margin: 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; text-align: center; margin-top: 0pt; margin-bottom: 0pt">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B>&nbsp;</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"></P>

<P STYLE="font: 11pt Times New Roman, Times, Serif; margin: 6pt 0; text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">REPORT
OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM</FONT></P>

<P STYLE="font: 11pt Times New Roman, Times, Serif; margin: 0; text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">To
the Board of Directors and<BR>
Stockholders of Splash Beverage Group, Inc.</FONT></P>

<P STYLE="font: 11pt Times New Roman, Times, Serif; margin: 0; text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">(FKA
Canfield Medical Supply, Inc.)</FONT></P>

<P STYLE="font: 11pt Times New Roman, Times, Serif; margin: 6pt 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B>Opinion
on the Financial Statements</B></FONT></P>

<P STYLE="font: 11pt Times New Roman, Times, Serif; margin: 6pt 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">We
have audited the accompanying consolidated balance sheets of Splash Beverage Group, Inc. (formerly known as Canfield Medical Supply,
Inc.) (the &ldquo;Company&rdquo;) at December 31, 2019, and the related consolidated statements operations, changes in deficiency
in stockholders&rsquo; equity and cash flows for the year ended December 31, 2019, and the related notes (collectively referred
to as the consolidated financial statements). In our opinion, the consolidated financial statements present fairly, in all material
respects, the financial position of the Company at December 31, 2019, and the results of its operations and its cash flows for
the year ended December 31, 2019, in conformity with accounting principles generally accepted in the United States of America.</FONT></P>

<P STYLE="font: 11pt Times New Roman, Times, Serif; margin: 6pt 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B>Going
Concern Uncertainty</B></FONT></P>

<P STYLE="font: 11pt Times New Roman, Times, Serif; margin: 6pt 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B>&nbsp;</B>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 suffered recurring losses from operations and has a net 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 3. The financial statements do not include any adjustments that might result from the outcome of this uncertainty.</FONT></P>

<P STYLE="font: 11pt Times New Roman, Times, Serif; margin: 6pt 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B>Basis
for Opinion</B></FONT></P>

<P STYLE="font: 11pt Times New Roman, Times, Serif; margin: 6pt 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">These
consolidated financial statements are the responsibility of the Company&rsquo;s management. Our responsibility is to express an
opinion on the Company&rsquo;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.</FONT></P>

<P STYLE="font: 11pt Times New Roman, Times, Serif; margin: 6pt 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">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 consolidated 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&rsquo;s internal control over financial reporting.
Accordingly, we express no such opinion.</FONT></P>

<P STYLE="font: 11pt Times New Roman, Times, Serif; margin: 6pt 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">Our
audits included performing procedures to assess the risks of material misstatement of the consolidated 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 consolidated 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
consolidated financial statements. We believe that our audits provide a reasonable basis for our opinion.</FONT></P>

<TABLE CELLSPACING="0" CELLPADDING="0" STYLE="width: 100%; border-collapse: collapse">
<TR STYLE="vertical-align: top">
    <TD COLSPAN="2" STYLE="font: 10pt Arial, Helvetica, Sans-Serif; padding-right: 4.5pt; padding-left: 4.5pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">/s/
    <I>Daszkal Bolton LLP</I></FONT></TD></TR>
<TR STYLE="vertical-align: top">
    <TD STYLE="width: 82%; padding-right: 4.5pt; padding-left: 4.5pt"><P STYLE="font: 11pt Times New Roman, Times, Serif; margin: 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">Daszkal
                                         Bolton LLP</FONT></P>
        <P STYLE="font: 11pt Times New Roman, Times, Serif; margin: 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P></TD>
    <TD STYLE="font: 10pt Arial, Helvetica, Sans-Serif; width: 18%; padding-right: 4.5pt; padding-left: 4.5pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: top">
    <TD COLSPAN="2" STYLE="padding-right: 4.5pt; padding-left: 4.5pt"><P STYLE="font: 11pt Times New Roman, Times, Serif; margin: 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><I>&nbsp;</I></FONT></P>
        <P STYLE="font: 11pt Times New Roman, Times, Serif; margin: 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">April
        3, 2020, except for note 1 to which the date is July 31, 2020</FONT></P>
        <P STYLE="font: 11pt Times New Roman, Times, Serif; margin: 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>
        <P STYLE="font: 11pt Times New Roman, Times, Serif; margin: 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">Boca
        Raton, Florida</FONT></P>
        <P STYLE="font: 11pt Times New Roman, Times, Serif; margin: 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>
        <P STYLE="font: 11pt Times New Roman, Times, Serif; margin: 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">We
        have served as the Company&rsquo;s auditor since 2020.</FONT></P></TD></TR>
</TABLE>
<P STYLE="font: 11pt Times New Roman, Times, Serif; margin: 0 0 6pt; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>
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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><A NAME="Fin_001"></A><B>Splash Beverage Group, Inc. and Subsidiaries</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><B>Consolidated Balance Sheets</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><B>December 31, 2019 and 2018</B></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: 12pt Times New Roman, Times, Serif; border-collapse: collapse; width: 100%">
<TR STYLE="vertical-align: bottom">
    <TD>&nbsp;</TD><TD STYLE="font-size: 10pt; font-weight: bold">&nbsp;</TD>
    <TD COLSPAN="3" STYLE="font-size: 10pt; font-weight: bold; text-align: center">2019</TD><TD STYLE="font-size: 10pt; font-weight: bold">&nbsp;</TD>
    <TD COLSPAN="3" STYLE="font-size: 10pt; font-weight: bold; text-align: center">2018</TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD STYLE="font-size: 10pt; font-weight: bold; text-align: center">Assets</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="3" STYLE="text-align: right">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="3" STYLE="text-align: right">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; text-align: left">Current assets:</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="width: 68%; font-size: 10pt; text-align: left; padding-left: 9pt">Cash and cash equivalents</TD><TD STYLE="width: 4%; font-size: 10pt">&nbsp;</TD>
    <TD STYLE="width: 1%; font-size: 10pt; text-align: left">$</TD><TD STYLE="width: 10%; font-size: 10pt; text-align: right">42,639</TD><TD STYLE="width: 1%; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="width: 4%; font-size: 10pt">&nbsp;</TD>
    <TD STYLE="width: 1%; font-size: 10pt; text-align: left">$</TD><TD STYLE="width: 10%; font-size: 10pt; text-align: right">938,040</TD><TD STYLE="width: 1%; font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; text-align: left; padding-left: 9pt">Accounts receivable, net</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">11,430</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&mdash;&nbsp;&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; text-align: left; padding-left: 9pt">Prepaid expenses</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">5,449</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">5,648</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; padding-left: 9pt">Inventory</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">304,012</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">276,788</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; text-align: left; padding-bottom: 1pt; padding-left: 9pt">Other receivables</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">7,132</TD><TD STYLE="padding-bottom: 1pt; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">5,700</TD><TD STYLE="padding-bottom: 1pt; font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; text-align: left; padding-bottom: 1pt; padding-left: 0.25in">Total current assets</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">370,662</TD><TD STYLE="padding-bottom: 1pt; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">1,226,176</TD><TD STYLE="padding-bottom: 1pt; font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; text-align: left">Non-current assets:</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; padding-left: 9pt">Deposit</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">34,915</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">14,402</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; text-align: left; padding-left: 9pt">Right of use asset, net</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">162,008</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&mdash;&nbsp;&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; text-align: left; padding-bottom: 1pt; padding-left: 9pt">Property and equipment, net</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">37,729</TD><TD STYLE="padding-bottom: 1pt; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">34,513</TD><TD STYLE="padding-bottom: 1pt; font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; text-align: left; padding-bottom: 1pt; padding-left: 0.25in">Total non-current assets</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">234,652</TD><TD STYLE="padding-bottom: 1pt; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">48,915</TD><TD STYLE="padding-bottom: 1pt; font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; text-align: left; padding-bottom: 2.5pt; padding-left: 0.25in">Total assets</TD><TD STYLE="font-size: 10pt; padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; text-align: left">$</TD><TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; text-align: right">605,314</TD><TD STYLE="padding-bottom: 2.5pt; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; text-align: left">$</TD><TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; text-align: right">1,275,091</TD><TD STYLE="padding-bottom: 2.5pt; font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="text-decoration: underline; font-size: 10pt; font-weight: bold; text-align: center">Liabilities and Deficiency in Stockholders' Equity</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt">Liabilities:</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; text-align: left; padding-left: 9pt">Current liabilities</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; text-align: left; padding-left: 0.25in">Accounts payable and accrued expenses</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">$</TD><TD STYLE="font-size: 10pt; text-align: right">703,885</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">$</TD><TD STYLE="font-size: 10pt; text-align: right">831,070</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; text-align: left; padding-left: 0.25in">Right of use liability &ndash; current</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">81,502</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&mdash;&nbsp;&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; text-align: left; padding-left: 0.25in">Due to related parties</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">429,432</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">302,934</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; text-align: left; padding-left: 0.25in">Bridge loan payable, net</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">2,200,000</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">1,858,385</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; text-align: left; padding-left: 0.25in">Related party notes payable &ndash; current</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">1,505,100</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&mdash;&nbsp;&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; text-align: left; padding-left: 0.25in">Convertible bridge loan payable &ndash; current</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">2,202,664</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">100,000</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; text-align: left; padding-left: 0.25in">Notes payable</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">875,000</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">875,000</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; text-align: left; padding-left: 0.25in">Royalty payable</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">39,000</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">21,062</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; text-align: left; padding-left: 0.25in">Revenue financing arrangements</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">45,467</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">77,108</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; text-align: left; padding-left: 0.25in">Shareholder advances</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">46,250</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">16,250</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; text-align: left; padding-left: 0.25in">Accrued interest payable</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">1,604,498</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">1,119,909</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; text-align: left; padding-bottom: 1pt; padding-left: 0.25in">Accrued interest payable - related parties</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">546,362</TD><TD STYLE="padding-bottom: 1pt; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">426,740</TD><TD STYLE="padding-bottom: 1pt; font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; text-align: left; padding-bottom: 1pt; padding-left: 27pt">Total current liabilities</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">10,279,160</TD><TD STYLE="padding-bottom: 1pt; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">5,628,458</TD><TD STYLE="padding-bottom: 1pt; font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; text-align: left">Long-term Liabilities:</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; text-align: left; padding-left: 9pt">Related party notes payable - non-current</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&mdash;&nbsp;&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">1,375,100</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; text-align: left; padding-left: 9pt">Convertible bridge loan payable - non-current</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&mdash;&nbsp;&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">2,102,664</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; text-align: left; padding-bottom: 1pt; padding-left: 9pt">Right of use liability &ndash; noncurrent</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">82,238</TD><TD STYLE="padding-bottom: 1pt; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">&mdash;&nbsp;&nbsp;</TD><TD STYLE="padding-bottom: 1pt; font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; text-align: left; padding-bottom: 1pt; padding-left: 27pt">Total long-term liabilities</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">82,238</TD><TD STYLE="padding-bottom: 1pt; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">3,477,764</TD><TD STYLE="padding-bottom: 1pt; font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; text-align: left; padding-bottom: 1pt; padding-left: 27pt">Total liabilities</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">10,361,398</TD><TD STYLE="padding-bottom: 1pt; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">9,106,222</TD><TD STYLE="padding-bottom: 1pt; font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; text-align: left">Deficiency in stockholders' equity:</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; text-align: left; text-indent: -0.1in; padding-left: 16.2pt">Common Stock, $0.001 par, 100,000,000 shares authorized, 44,021,389
and 40,165,002 issued and 43,885,096 and 39,892,417 outstanding for the years ended December 31, 2019 and 2018, respectively</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">44,021</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">40,165</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; text-align: left; text-indent: -0.1in; padding-left: 16.2pt">Additional paid in capital</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">22,095,403</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">18,938,480</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; text-align: left; text-indent: -0.1in; padding-left: 16.2pt">Treasury Stock, $0.001 par, 136,293 and 272,585 shares for the years ended December 31 2019 and 2018, respectively</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">(50,000</TD><TD STYLE="font-size: 10pt; text-align: left">)</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">(100,000</TD><TD STYLE="font-size: 10pt; text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; text-align: left; padding-bottom: 1pt; text-indent: -0.1in; padding-left: 16.2pt">Accumulated deficit</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">(31,845,506</TD><TD STYLE="padding-bottom: 1pt; font-size: 10pt; text-align: left">)</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">(26,709,776</TD><TD STYLE="padding-bottom: 1pt; font-size: 10pt; text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; text-align: left; padding-left: 27pt">Total deficiency in stockholders' equity</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">(9,756,083</TD><TD STYLE="font-size: 10pt; text-align: left">)</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">(7,831,131</TD><TD STYLE="font-size: 10pt; text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; text-align: left; padding-bottom: 2.5pt; padding-left: 27pt">Total liabilities and deficiency in stockholders' equity</TD><TD STYLE="font-size: 10pt; padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; text-align: left">$</TD><TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; text-align: right">605,314</TD><TD STYLE="padding-bottom: 2.5pt; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; text-align: left">$</TD><TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; text-align: right">1,275,091</TD><TD STYLE="padding-bottom: 2.5pt; font-size: 10pt; text-align: left">&nbsp;</TD></TR>
</TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; text-align: center; margin-top: 0pt; margin-bottom: 0pt">The accompanying
notes are an integral part of these consolidated financial statements.</P>



<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B>&nbsp;</B></FONT></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><A NAME="Fin_002"></A><B>Splash Beverage Group, Inc. and Subsidiaries</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><B>Consolidated Statements of Operations</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><B>For the Years Ended December 31, 2019 and 2018</B></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: 10pt Times New Roman, Times, Serif; border-collapse: collapse; width: 100%">
<TR STYLE="vertical-align: bottom">
    <TD STYLE="padding-bottom: 1pt">&nbsp;</TD><TD STYLE="padding-bottom: 1pt; font-weight: bold">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="border-bottom: Black 1pt solid; font-weight: bold; text-align: center">2019</TD><TD STYLE="padding-bottom: 1pt; font-weight: bold">&nbsp;</TD><TD STYLE="padding-bottom: 1pt; font-weight: bold">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="border-bottom: Black 1pt solid; font-weight: bold; text-align: center">2018</TD><TD STYLE="padding-bottom: 1pt; font-weight: bold">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="width: 76%; text-align: left">Net revenues</TD><TD STYLE="width: 1%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">$</TD><TD STYLE="width: 9%; text-align: right">20,387</TD><TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 1%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">$</TD><TD STYLE="width: 9%; text-align: right">16,176</TD><TD STYLE="width: 1%; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; padding-bottom: 1pt">Cost of goods sold</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">(245,500</TD><TD STYLE="padding-bottom: 1pt; text-align: left">)</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">(109,706</TD><TD STYLE="padding-bottom: 1pt; text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="text-align: left">Negative gross margin</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">(225,113</TD><TD STYLE="text-align: left">)</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">(93,530</TD><TD STYLE="text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="text-align: left">Operating expenses:</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="padding-left: 0.125in; text-align: left">Contracted services</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">2,109,146</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">1,493,076</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="padding-left: 0.125in; text-align: left">Salary and wages</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">1,078,730</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">508,769</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="padding-left: 0.125in; text-align: left">Other general and administrative</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">1,006,603</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">888,817</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="padding-left: 0.125in; text-align: left; padding-bottom: 1pt">Sales and marketing</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">67,467</TD><TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">112,506</TD><TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="padding-left: 0.25in; text-align: left">Total operating expenses</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">4,261,946</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">3,003,168</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="padding-bottom: 1pt">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">&nbsp;</TD><TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">&nbsp;</TD><TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left">Loss from operations</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">(4,487,059</TD><TD STYLE="text-align: left">)</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">(3,096,698</TD><TD STYLE="text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left">Other income/(expense):</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="padding-left: 0.125in; text-align: left">Interest income</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">132</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">-</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="padding-left: 0.125in; text-align: left">Interest expense</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">(665,195</TD><TD STYLE="text-align: left">)</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">(684,833</TD><TD STYLE="text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="padding-left: 0.125in; text-align: left; padding-bottom: 1pt">Gain/(loss) from debt extinguishment</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">16,391</TD><TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">(42,382</TD><TD STYLE="padding-bottom: 1pt; text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="padding-left: 0.25in; text-align: left">Total other income/(expense)</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">(648,672</TD><TD STYLE="text-align: left">)</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">(727,215</TD><TD STYLE="text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left">Provision for income taxes</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">-</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">-</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="padding-bottom: 1pt">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">&nbsp;</TD><TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">&nbsp;</TD><TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="padding-left: 0.125in; text-align: left; padding-bottom: 2.5pt">Net loss</TD><TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; text-align: left">$</TD><TD STYLE="border-bottom: Black 2.5pt double; text-align: right">(5,135,731</TD><TD STYLE="padding-bottom: 2.5pt; text-align: left">)</TD><TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; text-align: left">$</TD><TD STYLE="border-bottom: Black 2.5pt double; text-align: right">(3,823,913</TD><TD STYLE="padding-bottom: 2.5pt; text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; padding-bottom: 2.5pt">Net loss per share (basic and diluted)</TD><TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; text-align: left">$</TD><TD STYLE="border-bottom: Black 2.5pt double; text-align: right">(0.12</TD><TD STYLE="padding-bottom: 2.5pt; text-align: left">)</TD><TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; text-align: left">$</TD><TD STYLE="border-bottom: Black 2.5pt double; text-align: right">(0.11</TD><TD STYLE="padding-bottom: 2.5pt; text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="padding-bottom: 2.5pt">Weighted average number of common shares outstanding</TD><TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 2.5pt double; text-align: right">42,154,947</TD><TD STYLE="padding-bottom: 2.5pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 2.5pt double; text-align: right">36,108,948</TD><TD STYLE="padding-bottom: 2.5pt; text-align: left">&nbsp;</TD></TR>
</TABLE>



<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; text-align: center; margin-top: 0pt; margin-bottom: 0pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">The
accompanying notes are an integral part of these consolidated financial statements.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B>&nbsp;&nbsp;</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><A NAME="Fin_003"></A><B>Splash Beverage Group, Inc. and Subsidiaries</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><B>Consolidated Statements of Changes in Deficiency in Stockholders&rsquo;
Equity</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><B>For the Year Ended December 31, 2019</B></P>

<!-- Field: Rule-Page --><DIV STYLE="margin-top: 0; margin-bottom: 0; width: 100%"><DIV STYLE="border-top: Black 1pt solid; font-size: 1pt">&nbsp;</DIV></DIV><!-- Field: /Rule-Page -->

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<TABLE CELLSPACING="0" CELLPADDING="0" STYLE="font: 12pt Times New Roman, Times, Serif; width: 100%; border-collapse: collapse">
<TR STYLE="vertical-align: bottom">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD COLSPAN="3" STYLE="text-align: center">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD COLSPAN="3" STYLE="text-align: center">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD COLSPAN="3" STYLE="text-align: center">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD COLSPAN="3" STYLE="text-align: center">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD COLSPAN="3" STYLE="text-align: center">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD COLSPAN="3" STYLE="text-align: center">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD COLSPAN="3" STYLE="text-align: center"><FONT STYLE="font-size: 10pt"><B>Deficiency in</B></FONT></TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD COLSPAN="7" STYLE="text-align: center"><FONT STYLE="font-size: 10pt"><B>Common Stock</B></FONT></TD>
    <TD>&nbsp;</TD>
    <TD COLSPAN="7" STYLE="text-align: center"><FONT STYLE="font-size: 10pt"><B>Treasury Stock</B></FONT></TD>
    <TD>&nbsp;</TD>
    <TD COLSPAN="3" STYLE="text-align: center"><FONT STYLE="font-size: 10pt"><B>Additional</B></FONT></TD>
    <TD>&nbsp;</TD>
    <TD COLSPAN="3" STYLE="text-align: center"><FONT STYLE="font-size: 10pt"><B>Accumulated</B></FONT></TD>
    <TD>&nbsp;</TD>
    <TD COLSPAN="3" STYLE="text-align: center"><FONT STYLE="font-size: 10pt"><B>Stockholders'</B></FONT></TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD>&nbsp;</TD>
    <TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="3" STYLE="border-bottom: black 1pt solid; text-align: center"><FONT STYLE="font-size: 10pt"><B>Shares</B></FONT></TD>
    <TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="3" STYLE="border-bottom: black 1pt solid; text-align: center"><FONT STYLE="font-size: 10pt"><B>Amount</B></FONT></TD>
    <TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="3" STYLE="border-bottom: black 1pt solid; text-align: center"><FONT STYLE="font-size: 10pt"><B>Shares</B></FONT></TD>
    <TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="3" STYLE="border-bottom: black 1pt solid; text-align: center"><FONT STYLE="font-size: 10pt"><B>Amount</B></FONT></TD>
    <TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="3" STYLE="border-bottom: black 1pt solid; text-align: center"><FONT STYLE="font-size: 10pt"><B>Paid-In Capital</B></FONT></TD>
    <TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="3" STYLE="border-bottom: black 1pt solid; text-align: center"><FONT STYLE="font-size: 10pt"><B>Deficit</B></FONT></TD>
    <TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="3" STYLE="border-bottom: black 1pt solid; text-align: center"><FONT STYLE="font-size: 10pt"><B>Equity</B></FONT></TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD COLSPAN="3" STYLE="text-align: center">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD COLSPAN="3" STYLE="text-align: center">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD COLSPAN="3" STYLE="text-align: center">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD COLSPAN="3" STYLE="text-align: center">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD COLSPAN="3" STYLE="text-align: center">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD COLSPAN="3">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD COLSPAN="3">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: #CCEEFF">
    <TD STYLE="width: 44%; padding-bottom: 2.5pt"><FONT STYLE="font-size: 10pt"><B>Balances at December 31, 2017</B></FONT></TD>
    <TD STYLE="width: 1%; padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: black 2.25pt double; width: 1%">&nbsp;</TD>
    <TD STYLE="border-bottom: black 2.25pt double; width: 5%; text-align: right"><FONT STYLE="font-size: 10pt">35,150,103</FONT></TD>
    <TD STYLE="width: 1%; padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="width: 1%; padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: black 2.25pt double; width: 1%"><FONT STYLE="font-size: 10pt">$</FONT></TD>
    <TD STYLE="border-bottom: black 2.25pt double; width: 5%; text-align: right"><FONT STYLE="font-size: 10pt">35,150</FONT></TD>
    <TD STYLE="width: 1%; padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="width: 1%; padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: black 2.25pt double; width: 1%">&nbsp;</TD>
    <TD STYLE="border-bottom: black 2.25pt double; width: 5%; text-align: right"><FONT STYLE="font-size: 10pt">408,877</FONT></TD>
    <TD STYLE="width: 1%; padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="width: 1%; padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: black 2.25pt double; width: 1%"><FONT STYLE="font-size: 10pt">$</FONT></TD>
    <TD STYLE="border-bottom: black 2.25pt double; width: 5%; text-align: right"><FONT STYLE="font-size: 10pt">(150,000</FONT></TD>
    <TD STYLE="width: 1%; padding-bottom: 2.5pt"><FONT STYLE="font-size: 10pt">)</FONT></TD>
    <TD STYLE="width: 1%; padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: black 2.25pt double; width: 1%"><FONT STYLE="font-size: 10pt">$</FONT></TD>
    <TD STYLE="border-bottom: black 2.25pt double; width: 5%; text-align: right"><FONT STYLE="font-size: 10pt">15,716,749</FONT></TD>
    <TD STYLE="width: 1%; padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="width: 1%; padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: black 2.25pt double; width: 1%"><FONT STYLE="font-size: 10pt">$</FONT></TD>
    <TD STYLE="border-bottom: black 2.25pt double; width: 5%; text-align: right"><FONT STYLE="font-size: 10pt">(22,885,863</FONT></TD>
    <TD STYLE="width: 1%; padding-bottom: 2.5pt"><FONT STYLE="font-size: 10pt">)</FONT></TD>
    <TD STYLE="width: 1%; padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: black 2.25pt double; width: 1%"><FONT STYLE="font-size: 10pt">$</FONT></TD>
    <TD STYLE="border-bottom: black 2.25pt double; width: 5%; text-align: right"><FONT STYLE="font-size: 10pt">&#8239;&#8239;(7,283,964)</FONT></TD>
    <TD STYLE="width: 1%; padding-bottom: 2.5pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: white">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">&nbsp;</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: #CCEEFF">
    <TD STYLE="padding-left: 10pt"><FONT STYLE="font-size: 10pt">Issuance of Common stock for cash</FONT></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">4,878,607</FONT></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">4,879</FONT></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">&mdash;&nbsp;&nbsp;</FONT></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">&mdash;&nbsp;&nbsp;</FONT></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">2,180,444</FONT></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">&mdash;&nbsp;&nbsp;</FONT></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">2,185,323</FONT></TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: white">
    <TD STYLE="padding-left: 10pt"><FONT STYLE="font-size: 10pt">Issuance of Common stock from treasury</FONT></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">136,292</FONT></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">136</FONT></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">(136,292</FONT></TD>
    <TD><FONT STYLE="font-size: 10pt">)</FONT></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">50,000</FONT></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">49,864</FONT></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">&mdash;&nbsp;&nbsp;</FONT></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">100,000</FONT></TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: #CCEEFF">
    <TD STYLE="padding-left: 10pt"><FONT STYLE="font-size: 10pt">Warrants issued with debt</FONT></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">&mdash;&nbsp;&nbsp;</FONT></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">&mdash;&nbsp;&nbsp;</FONT></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">&mdash;&nbsp;&nbsp;</FONT></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">&mdash;&nbsp;&nbsp;</FONT></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">991,423</FONT></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">&mdash;&nbsp;&nbsp;</FONT></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">991,423</FONT></TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: white">
    <TD STYLE="padding-bottom: 1pt; padding-left: 10pt"><FONT STYLE="font-size: 10pt">Net loss</FONT></TD>
    <TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid; text-align: right"><FONT STYLE="font-size: 10pt">&mdash;&nbsp;&nbsp;</FONT></TD>
    <TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid; text-align: right"><FONT STYLE="font-size: 10pt">&mdash;&nbsp;&nbsp;</FONT></TD>
    <TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid; text-align: right"><FONT STYLE="font-size: 10pt">&mdash;&nbsp;&nbsp;</FONT></TD>
    <TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid; text-align: right"><FONT STYLE="font-size: 10pt">&mdash;&nbsp;&nbsp;</FONT></TD>
    <TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid; text-align: right"><FONT STYLE="font-size: 10pt">&mdash;&nbsp;&nbsp;</FONT></TD>
    <TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid; text-align: right"><FONT STYLE="font-size: 10pt">(3,823,913</FONT></TD>
    <TD STYLE="padding-bottom: 1pt"><FONT STYLE="font-size: 10pt">)</FONT></TD>
    <TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid; text-align: right"><FONT STYLE="font-size: 10pt">(3,823,913</FONT></TD>
    <TD STYLE="padding-bottom: 1pt"><FONT STYLE="font-size: 10pt">)</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: #CCEEFF">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">&nbsp;</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: white">
    <TD STYLE="padding-bottom: 2.5pt"><FONT STYLE="font-size: 10pt"><B>Balances at December 31, 2018</B></FONT></TD>
    <TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: black 2.25pt double">&nbsp;</TD>
    <TD STYLE="border-bottom: black 2.25pt double; text-align: right"><FONT STYLE="font-size: 10pt">40,165,002</FONT></TD>
    <TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: black 2.25pt double"><FONT STYLE="font-size: 10pt">$</FONT></TD>
    <TD STYLE="border-bottom: black 2.25pt double; text-align: right"><FONT STYLE="font-size: 10pt">40,165</FONT></TD>
    <TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: black 2.25pt double">&nbsp;</TD>
    <TD STYLE="border-bottom: black 2.25pt double; text-align: right"><FONT STYLE="font-size: 10pt">272,585</FONT></TD>
    <TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: black 2.25pt double"><FONT STYLE="font-size: 10pt">$</FONT></TD>
    <TD STYLE="border-bottom: black 2.25pt double; text-align: right"><FONT STYLE="font-size: 10pt">(100,000</FONT></TD>
    <TD STYLE="padding-bottom: 2.5pt"><FONT STYLE="font-size: 10pt">)</FONT></TD>
    <TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: black 2.25pt double"><FONT STYLE="font-size: 10pt">$</FONT></TD>
    <TD STYLE="border-bottom: black 2.25pt double; text-align: right"><FONT STYLE="font-size: 10pt">18,938,480</FONT></TD>
    <TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: black 2.25pt double"><FONT STYLE="font-size: 10pt">$</FONT></TD>
    <TD STYLE="border-bottom: black 2.25pt double; text-align: right"><FONT STYLE="font-size: 10pt">(26,709,776</FONT></TD>
    <TD STYLE="padding-bottom: 2.5pt"><FONT STYLE="font-size: 10pt">)</FONT></TD>
    <TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: black 2.25pt double"><FONT STYLE="font-size: 10pt">$</FONT></TD>
    <TD STYLE="border-bottom: black 2.25pt double; text-align: right"><FONT STYLE="font-size: 10pt">&#8239;&#8239;(7,831,131</FONT></TD>
    <TD STYLE="padding-bottom: 2.5pt"><FONT STYLE="font-size: 10pt">)</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: #CCEEFF">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">&nbsp;</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: white">
    <TD STYLE="padding-left: 10pt"><FONT STYLE="font-size: 10pt">Issuance of Common stock for cash</FONT></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">2,146,601</FONT></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">2,146</FONT></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">&mdash;&nbsp;&nbsp;</FONT></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">&mdash;&nbsp;&nbsp;</FONT></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">1,572,854</FONT></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">&mdash;&nbsp;&nbsp;</FONT></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD><FONT STYLE="font-size: 10pt">$</FONT></TD>
    <TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">&#8239;&#8239;1,575,000</FONT></TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: #CCEEFF">
    <TD STYLE="padding-left: 10pt"><FONT STYLE="font-size: 10pt">Issuance of Common stock for services</FONT></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">1,709,785</FONT></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">1,709</FONT></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">&mdash;&nbsp;&nbsp;</FONT></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">&mdash;&nbsp;&nbsp;</FONT></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">1,252,914</FONT></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">&mdash;&nbsp;&nbsp;</FONT></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">1,254,623</FONT></TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: white">
    <TD STYLE="padding-left: 10pt"><FONT STYLE="font-size: 10pt">Issuance of Common stock from treasury</FONT></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">&mdash;&nbsp;&nbsp;</FONT></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">&mdash;&nbsp;&nbsp;</FONT></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">(136,292</FONT></TD>
    <TD><FONT STYLE="font-size: 10pt">)</FONT></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">50,000</FONT></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">49,900</FONT></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">&mdash;&nbsp;&nbsp;</FONT></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">99,900</FONT></TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: #CCEEFF">
    <TD STYLE="padding-left: 10pt"><FONT STYLE="font-size: 10pt">Warrants issued in connection with debt modification</FONT></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">&mdash;&nbsp;&nbsp;</FONT></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">&mdash;&nbsp;&nbsp;</FONT></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">&mdash;&nbsp;&nbsp;</FONT></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">&mdash;&nbsp;&nbsp;</FONT></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">15,667</FONT></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">&mdash;&nbsp;&nbsp;</FONT></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">15,667</FONT></TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: white">
    <TD STYLE="padding-left: 10pt"><FONT STYLE="font-size: 10pt">Share-based compensation</FONT></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">&mdash;&nbsp;&nbsp;</FONT></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">&mdash;&nbsp;&nbsp;</FONT></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">&mdash;&nbsp;&nbsp;</FONT></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">&mdash;&nbsp;&nbsp;</FONT></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">265,589</FONT></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">&mdash;&nbsp;&nbsp;</FONT></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">265,589</FONT></TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: #CCEEFF">
    <TD STYLE="padding-bottom: 1pt; padding-left: 10pt"><FONT STYLE="font-size: 10pt">Net loss</FONT></TD>
    <TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid; text-align: right"><FONT STYLE="font-size: 10pt">&mdash;&nbsp;&nbsp;</FONT></TD>
    <TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid; text-align: right"><FONT STYLE="font-size: 10pt">&mdash;&nbsp;&nbsp;</FONT></TD>
    <TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid; text-align: right"><FONT STYLE="font-size: 10pt">&mdash;&nbsp;&nbsp;</FONT></TD>
    <TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid; text-align: right"><FONT STYLE="font-size: 10pt">&mdash;&nbsp;&nbsp;</FONT></TD>
    <TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid; text-align: right"><FONT STYLE="font-size: 10pt">&mdash;&nbsp;&nbsp;</FONT></TD>
    <TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid; text-align: right"><FONT STYLE="font-size: 10pt">(5,135,731</FONT></TD>
    <TD STYLE="padding-bottom: 1pt"><FONT STYLE="font-size: 10pt">)</FONT></TD>
    <TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid; text-align: right"><FONT STYLE="font-size: 10pt">(5,135,731</FONT></TD>
    <TD STYLE="padding-bottom: 1pt"><FONT STYLE="font-size: 10pt">)</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: white">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">&nbsp;</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: #CCEEFF">
    <TD STYLE="padding-bottom: 2.5pt"><FONT STYLE="font-size: 10pt"><B>Balances at December 31, 2019</B></FONT></TD>
    <TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: black 2.25pt double">&nbsp;</TD>
    <TD STYLE="border-bottom: black 2.25pt double; text-align: right"><FONT STYLE="font-size: 10pt">44,021,389</FONT></TD>
    <TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: black 2.25pt double"><FONT STYLE="font-size: 10pt">$</FONT></TD>
    <TD STYLE="border-bottom: black 2.25pt double; text-align: right"><FONT STYLE="font-size: 10pt">44,021</FONT></TD>
    <TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: black 2.25pt double">&nbsp;</TD>
    <TD STYLE="border-bottom: black 2.25pt double; text-align: right"><FONT STYLE="font-size: 10pt">136,293</FONT></TD>
    <TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: black 2.25pt double"><FONT STYLE="font-size: 10pt">$</FONT></TD>
    <TD STYLE="border-bottom: black 2.25pt double; text-align: right"><FONT STYLE="font-size: 10pt">(50,000</FONT></TD>
    <TD STYLE="padding-bottom: 2.5pt"><FONT STYLE="font-size: 10pt">)</FONT></TD>
    <TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: black 2.25pt double"><FONT STYLE="font-size: 10pt">$</FONT></TD>
    <TD STYLE="border-bottom: black 2.25pt double; text-align: right"><FONT STYLE="font-size: 10pt">22,095,403</FONT></TD>
    <TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: black 2.25pt double"><FONT STYLE="font-size: 10pt">$</FONT></TD>
    <TD STYLE="border-bottom: black 2.25pt double; text-align: right"><FONT STYLE="font-size: 10pt">(31,845,506</FONT></TD>
    <TD STYLE="padding-bottom: 2.5pt"><FONT STYLE="font-size: 10pt">)</FONT></TD>
    <TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: black 2.25pt double"><FONT STYLE="font-size: 10pt">$</FONT></TD>
    <TD STYLE="border-bottom: black 2.25pt double; text-align: right"><FONT STYLE="font-size: 10pt">(9,756,083</FONT></TD>
    <TD STYLE="padding-bottom: 2.5pt"><FONT STYLE="font-size: 10pt">)</FONT></TD></TR>
</TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>




<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"></P>



<P STYLE="font: 10pt Times New Roman, Times, Serif; text-align: center; margin-top: 0pt; margin-bottom: 0pt"><FONT STYLE="font: normal 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; text-align: center; margin-top: 0pt; margin-bottom: 0pt"><FONT STYLE="font: normal 10pt Times New Roman, Times, Serif">The
accompanying notes are an integral part of these consolidated financial statements.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B>&nbsp;</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B>&nbsp;&nbsp;&nbsp;&nbsp;</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><B><A NAME="Fin_004"></A>Splash Beverage Group, Inc. and Subsidiaries</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><B>Consolidated Statements of Cash Flows</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><B>December 31, 2019 and 2018</B></P>

<!-- Field: Rule-Page --><DIV STYLE="margin-top: 0; margin-bottom: 0; width: 100%"><DIV STYLE="border-top: Black 1pt solid; font-size: 1pt">&nbsp;</DIV></DIV><!-- Field: /Rule-Page -->

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><B>&nbsp;</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: 10pt Times New Roman, Times, Serif; border-collapse: collapse; width: 100%">
<TR STYLE="vertical-align: bottom">
    <TD STYLE="padding-bottom: 1pt; white-space: nowrap">&nbsp;</TD><TD STYLE="padding-bottom: 1pt; font-weight: bold">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="border-bottom: Black 1pt solid; white-space: nowrap; font-weight: bold; text-align: center">2019</TD><TD STYLE="padding-bottom: 1pt; font-weight: bold">&nbsp;</TD><TD STYLE="padding-bottom: 1pt; font-weight: bold">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="border-bottom: Black 1pt solid; white-space: nowrap; font-weight: bold; text-align: center">2018</TD><TD STYLE="padding-bottom: 1pt; font-weight: bold">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="text-align: left">Cash Flows from Operating Activities</TD><TD></TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="white-space: nowrap; text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="white-space: nowrap; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="width: 84%; text-align: left">Net loss</TD><TD STYLE="width: 1%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">$</TD><TD STYLE="width: 5%; text-align: right">(5,135,731</TD><TD STYLE="white-space: nowrap; width: 1%; text-align: left">)</TD><TD STYLE="width: 1%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">$</TD><TD STYLE="width: 5%; text-align: right">(3,823,913</TD><TD STYLE="white-space: nowrap; width: 1%; text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="text-align: left; padding-left: 9pt">Adjustments to reconcile net loss to net cash used in operating activities:</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="white-space: nowrap; text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="white-space: nowrap; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; padding-left: 0.25in">Depreciation and amortization</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">9,334</TD><TD STYLE="white-space: nowrap; text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">7,257</TD><TD STYLE="white-space: nowrap; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="text-align: left; padding-left: 0.25in">Amortization of right-of-use asset</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">53,194</TD><TD STYLE="white-space: nowrap; text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">-</TD><TD STYLE="white-space: nowrap; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; padding-left: 0.25in">Gain from debt extinguishment</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">(16,391</TD><TD STYLE="white-space: nowrap; text-align: left">)</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">-</TD><TD STYLE="white-space: nowrap; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="text-align: left; padding-left: 0.25in">Deferred loan cost amortization</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">-</TD><TD STYLE="white-space: nowrap; text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">130,055</TD><TD STYLE="white-space: nowrap; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; padding-left: 0.25in">Noncash finance charge in connection with a debt modification</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">15,667</TD><TD STYLE="white-space: nowrap; text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">-</TD><TD STYLE="white-space: nowrap; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="text-align: left; padding-left: 0.25in">Share-based compensation</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">265,589</TD><TD STYLE="white-space: nowrap; text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">-</TD><TD STYLE="white-space: nowrap; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; padding-left: 0.25in">Shares issued in exchange for services</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">1,354,503</TD><TD STYLE="white-space: nowrap; text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">664,815</TD><TD STYLE="white-space: nowrap; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="text-align: left; padding-left: 0.25in">Warrants issued for services</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">-</TD><TD STYLE="white-space: nowrap; text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">991,423</TD><TD STYLE="white-space: nowrap; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; padding-left: 0.25in">Other noncash charges</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">360,923</TD><TD STYLE="white-space: nowrap; text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">32,252</TD><TD STYLE="white-space: nowrap; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="text-align: left; padding-left: 9pt">Changes in assets and liabilities:</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="white-space: nowrap; text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="white-space: nowrap; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; padding-left: 0.25in">Accounts receivable</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">(11,428</TD><TD STYLE="white-space: nowrap; text-align: left">)</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">-</TD><TD STYLE="white-space: nowrap; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="padding-left: 0.25in">Inventory</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">(27,224</TD><TD STYLE="white-space: nowrap; text-align: left">)</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">(276,788</TD><TD STYLE="white-space: nowrap; text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; padding-left: 0.25in">Prepaid expenses and other current assets</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">(1,233</TD><TD STYLE="white-space: nowrap; text-align: left">)</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">(20,049</TD><TD STYLE="white-space: nowrap; text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="text-align: left; padding-left: 0.25in">Due to related party</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">-</TD><TD STYLE="white-space: nowrap; text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">5,496</TD><TD STYLE="white-space: nowrap; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="padding-left: 0.25in">Deposits</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">(20,513</TD><TD STYLE="white-space: nowrap; text-align: left">)</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">-</TD><TD STYLE="white-space: nowrap; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="text-align: left; padding-left: 0.25in">Accounts payable and accrued expenses</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">(127,167</TD><TD STYLE="white-space: nowrap; text-align: left">)</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">255,352</TD><TD STYLE="white-space: nowrap; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; padding-left: 0.25in">Royalty payable</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">17,938</TD><TD STYLE="white-space: nowrap; text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">(326,750</TD><TD STYLE="white-space: nowrap; text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="text-align: left; padding-bottom: 1pt; padding-left: 0.25in">Accrued interest payable</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">604,211</TD><TD STYLE="white-space: nowrap; padding-bottom: 1pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">(110,345</TD><TD STYLE="white-space: nowrap; padding-bottom: 1pt; text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; padding-bottom: 1pt">Net cash used in operating activities</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">(2,658,328</TD><TD STYLE="white-space: nowrap; padding-bottom: 1pt; text-align: left">)</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">(2,471,195</TD><TD STYLE="white-space: nowrap; padding-bottom: 1pt; text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="white-space: nowrap; text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="white-space: nowrap; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left">Cash Flows from Investing Activities:</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="white-space: nowrap; text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="white-space: nowrap; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="text-align: left; padding-bottom: 1pt; padding-left: 9pt">Capital expenditures</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">(12,552</TD><TD STYLE="white-space: nowrap; padding-bottom: 1pt; text-align: left">)</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">(1,336</TD><TD STYLE="white-space: nowrap; padding-bottom: 1pt; text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; padding-bottom: 1pt">Net cash used in investing activities</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">(12,552</TD><TD STYLE="white-space: nowrap; padding-bottom: 1pt; text-align: left">)</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">(1,336</TD><TD STYLE="white-space: nowrap; padding-bottom: 1pt; text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="white-space: nowrap; text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="white-space: nowrap; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left">Cash Flows from Financing Activities:</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="white-space: nowrap; text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="white-space: nowrap; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="text-align: left; padding-left: 9pt">Proceeds from issuance of common stock</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">1,575,000</TD><TD STYLE="white-space: nowrap; text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">1,398,197</TD><TD STYLE="white-space: nowrap; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; padding-left: 9pt">Shareholder advances</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">153,582</TD><TD STYLE="white-space: nowrap; text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">-</TD><TD STYLE="white-space: nowrap; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="text-align: left; padding-left: 9pt">Proceeds from issuance of debt</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">130,000</TD><TD STYLE="white-space: nowrap; text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">2,702,664</TD><TD STYLE="white-space: nowrap; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; padding-left: 9pt">Principal repayment of debt</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">(31,641</TD><TD STYLE="white-space: nowrap; text-align: left">)</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">(422,425</TD><TD STYLE="white-space: nowrap; text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="text-align: left; padding-left: 9pt">Debt issuance costs</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">-</TD><TD STYLE="white-space: nowrap; text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">(271,670</TD><TD STYLE="white-space: nowrap; text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; padding-bottom: 1pt; padding-left: 9pt">Reduction of right-of-use liability</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">(51,462</TD><TD STYLE="white-space: nowrap; padding-bottom: 1pt; text-align: left">)</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">-</TD><TD STYLE="white-space: nowrap; padding-bottom: 1pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="text-align: left; padding-bottom: 1pt">Net cash provided by financing activities</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">1,775,479</TD><TD STYLE="white-space: nowrap; padding-bottom: 1pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">3,406,766</TD><TD STYLE="white-space: nowrap; padding-bottom: 1pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="white-space: nowrap; text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="white-space: nowrap; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="text-align: left">Net Decrease in Cash and Cash Equivalents</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">(895,401</TD><TD STYLE="white-space: nowrap; text-align: left">)</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">934,235</TD><TD STYLE="white-space: nowrap; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="white-space: nowrap; text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="white-space: nowrap; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="text-align: left; padding-bottom: 1pt">Cash and Cash Equivalents, beginning of year</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">938,040</TD><TD STYLE="white-space: nowrap; padding-bottom: 1pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">3,805</TD><TD STYLE="white-space: nowrap; padding-bottom: 1pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="white-space: nowrap; text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="white-space: nowrap; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="text-align: left; padding-bottom: 2.5pt">Cash and Cash Equivalents, end of year</TD><TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; text-align: left">$</TD><TD STYLE="border-bottom: Black 2.5pt double; text-align: right">42,639</TD><TD STYLE="white-space: nowrap; padding-bottom: 2.5pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; text-align: left">$</TD><TD STYLE="border-bottom: Black 2.5pt double; text-align: right">938,040</TD><TD STYLE="white-space: nowrap; padding-bottom: 2.5pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="white-space: nowrap; text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="white-space: nowrap; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="text-decoration: underline; font-weight: bold; text-align: left">Supplemental Disclosure of Cash Flow Information:</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="white-space: nowrap; text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="white-space: nowrap; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; padding-bottom: 2.5pt; padding-left: 0.25in">Cash paid for interest</TD><TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; text-align: left">$</TD><TD STYLE="border-bottom: Black 2.5pt double; text-align: right">23,851</TD><TD STYLE="white-space: nowrap; padding-bottom: 2.5pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; text-align: left">$</TD><TD STYLE="border-bottom: Black 2.5pt double; text-align: right">586,075</TD><TD STYLE="white-space: nowrap; padding-bottom: 2.5pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="text-align: left; padding-bottom: 2.5pt; padding-left: 0.25in">Cash paid for taxes</TD><TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; text-align: left">$</TD><TD STYLE="border-bottom: Black 2.5pt double; text-align: right">-</TD><TD STYLE="white-space: nowrap; padding-bottom: 2.5pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; text-align: left">$</TD><TD STYLE="border-bottom: Black 2.5pt double; text-align: right">-</TD><TD STYLE="white-space: nowrap; padding-bottom: 2.5pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="white-space: nowrap; text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="white-space: nowrap; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="text-decoration: underline; font-weight: bold; text-align: left">Supplemental Disclosure of Non-Cash Investing
    and Financing Activities</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="white-space: nowrap; text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="white-space: nowrap; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; padding-left: 0.25in">Notes converted to common stock</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">$</TD><TD STYLE="text-align: right">-</TD><TD STYLE="white-space: nowrap; text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">$</TD><TD STYLE="text-align: right">684,450</TD><TD STYLE="white-space: nowrap; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="text-align: left; padding-left: 0.25in">Loss on debt extinguishment</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">$</TD><TD STYLE="text-align: right">-</TD><TD STYLE="white-space: nowrap; text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">$</TD><TD STYLE="text-align: right">42,382</TD><TD STYLE="white-space: nowrap; text-align: left">&nbsp;</TD></TR>
</TABLE>



<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><B>&nbsp;</B>&nbsp;<FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B>&nbsp;</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; text-align: center; margin-top: 0pt; margin-bottom: 0pt"><FONT STYLE="font: normal 10pt Times New Roman, Times, Serif">The
accompanying notes are an integral part of these consolidated financial statements.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B>&nbsp;</B></FONT></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><A NAME="Fin_005"></A><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B>Splash
Beverage Group, Inc.</B></FONT></P>

<P STYLE="border-bottom: Black 1pt solid; font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B>Notes
to the Consolidated Financial Statements</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;<B>&nbsp;</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0"><B><U>Note 1 &ndash; Business Organization and Nature of Operations</U></B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 1in; text-align: justify; text-indent: -1in"><FONT STYLE="text-transform: uppercase"><B>&nbsp;</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 1in; text-align: justify; text-indent: -1in"><FONT STYLE="text-transform: uppercase"><B></B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">Splash Beverage Group (&ldquo;SBG&rdquo;),
f/k/a Canfield Medical Supply, Inc. (the &ldquo;CMS&rdquo;), was incorporated in the State of Ohio on September 3, 1992, and changed
domicile to Colorado on April 18, 2012. CMS is in the business of home health services, primarily the selling of durable medical
equipment and medical supplies to the public, nursing homes, hospitals and other end users.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">On December 31, 2019, CMS entered into
an Agreement and Plan of Merger (the &ldquo;Merger Agreement&rdquo;) with SBG Acquisition Inc. (&ldquo;Merger Sub&rdquo;), a Nevada
Corporation wholly-owned by CMS, and Splash Beverage Group, Inc. a Nevada corporation (&ldquo;Splash&rdquo;) pursuant to which
Merger Sub merged with and into Splash (the &ldquo;Merger&rdquo;) with Splash as the surviving company and a wholly-owned subsidiary
of CMS. The Merger was consummated on March 31, 2020.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">As the owners and management of Splash
have voting and operating control of CMS following the Merger, the Merger transaction was accounted for as a reverse acquisition
(that is with Splash as the acquiring entity), followed by a recapitalization.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">As part of the recapitalization, previously
issued shares of SBG preferred stock have been reflected as shares of common stock that were received in the Merger. These common
shares have been retrospectively presented as outstanding for all periods.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">Splash specializes in the manufacturing,
distribution, and sales &amp; marketing of various beverages across multiple channels. Splash operates in both the non-alcoholic
and alcoholic beverage segments. Additionally, Splash operates its own vertically integrated B-to-B and B-to-C e-commerce distribution
platform called Qplash, further expanding its distribution abilities and visibility.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">On July 2, 2020, CMS received a Certificate
of Good Standing from the State of Colorado. This certificate allowed us to change our name from Canfield Medical Supply, Inc.
to Splash Beverage Group, Inc. a Colorado company. On July 31, 2020, we received approval from FINRA to change the Company&rsquo;s
name from Canfield Medical Supply, Inc. to Splash Beverage Group, Inc.</P>





<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 1in; text-align: justify; text-indent: -1in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">These financial statements represent the
operations of SBG and do not include the operations of CMS.</P>



<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 1in; text-align: justify; text-indent: -1in"><B>&nbsp;</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 1in; text-align: justify; text-indent: -1in"><B><U>Note 2 &ndash;
Summary of Significant Accounting Policies</U></B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><B><I><U>Basis of Presentation and Consolidation</U></I></B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">Our accounting and reporting policies conform
to accounting principles generally accepted in the United States of America (&ldquo;GAAP&rdquo;). These consolidated financial
statements include the accounts of Splash and its wholly owned subsidiaries, Splash International Holdings, LLC, Splash Beverage
Holdings, LLC and Splash Mex SA de CV. All intercompany balances have been eliminated in consolidation.&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><B><I>&nbsp;</I></B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><B><I><U>Use of Estimates</U></I></B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">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 disclosures of contingent assets and liabilities at the date of the financial statements and the reported amounts
of revenues and expenses during the reporting period. Actual results could differ from those estimates.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><B><I><U>Cash Equivalents and Concentration
of Cash Balance</U></I></B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">We consider all highly liquid securities with
an original maturity of three months or less to be cash equivalents. We had no cash equivalents at December 31, 2019. Our cash
in bank deposit accounts, at times, may exceed federally insured limits of $250,000. Our bank deposit accounts in Mexico are uninsured.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><B><I><U>Accounts Receivable and Allowance
for Doubtful Accounts</U></I></B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">Accounts receivable are carried at their estimated
collectible amounts and are periodically evaluated for collectability based on past credit history with clients and other factors.
We establish provisions for losses on accounts receivable on the basis of loss experience, known and inherent risk in the account
balance, and current economic conditions.&nbsp; At December 31, 2019 and 2018, our accounts receivable amounts are reflected net
of allowances of $11,430 and $0, respectively.</P>



<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B><I>&nbsp;</I></B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B><I>&nbsp;</I></B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B>Splash
Beverage Group, Inc.</B></FONT></P>

<P STYLE="border-bottom: Black 1pt solid; font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B>Notes
to the Consolidated Financial Statements</B></FONT></P>


<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 1in; text-align: justify; text-indent: -1in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 1in; text-align: justify; text-indent: -1in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B><U>Note
2 &ndash; Summary of Significant Accounting Policies, continued</U></B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B><I>&nbsp;</I></B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B><I><U>Inventory</U></I></B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">Inventory is stated at the lower of cost or
net realizable value, accounted for using the weighted average cost method. The inventory balances at December 31, 2019 and 2018
consisted of finished goods held for distribution. The cost elements in inventory consist of purchase of products, transportation,
and warehousing. Inventory valuation is impacted by excess or inventory near expiration based on management&rsquo;s estimates for
excess or inventory near expiration based on management&rsquo;s estimates of forecast turnover of inventories on hand and under
contract. A significant change in the timing or level of demand for certain products as compared to forecast amounts may result
in recording expense for excess or expired inventory in the future. The costs for excess inventory are included in cost of goods
sold and have historically been adequate to provide for losses on inventory.&nbsp;We manage inventory levels and purchase commitments
in an effort to maximize utilization of inventory on hand and under commitments.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B><I><U>Property
and Equipment</U></I></B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">We
record property and equipment at cost when purchased. Depreciation is recorded for property, equipment, and software using the
straight-line method over the estimated economic useful lives of assets, which range from 3-10 years. Company management reviews
the recoverability of all long-lived assets, including the related useful lives, whenever events or changes in circumstances indicate
that the carrying amount of a long-lived asset might not be recoverable.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">Depreciation
expense totaled $19,781 and $7,257 for the years ended December 31, 2019 and 2018, respectively. Property and equipment as of
December 31, 2019 and 2018 consisted of the following:</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: 10pt Times New Roman, Times, Serif; border-collapse: collapse; width: 100%">
<TR STYLE="vertical-align: bottom">
    <TD STYLE="padding-bottom: 1pt">&nbsp;</TD><TD STYLE="padding-bottom: 1pt; font-weight: bold">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="border-bottom: Black 1pt solid; font-weight: bold; text-align: center">2019</TD><TD STYLE="padding-bottom: 1pt; font-weight: bold">&nbsp;</TD><TD STYLE="padding-bottom: 1pt; font-weight: bold">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="border-bottom: Black 1pt solid; font-weight: bold; text-align: center">2018</TD><TD STYLE="padding-bottom: 1pt; font-weight: bold">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="width: 76%; text-align: left">Property and equipment, at cost</TD><TD STYLE="width: 1%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">$</TD><TD STYLE="width: 9%; text-align: right">88,758</TD><TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 1%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">$</TD><TD STYLE="width: 9%; text-align: right">76,205</TD><TD STYLE="width: 1%; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; padding-bottom: 1pt">Accumulated depreciation</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">(51,029</TD><TD STYLE="padding-bottom: 1pt; text-align: left">)</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">(41,692</TD><TD STYLE="padding-bottom: 1pt; text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="text-align: left; padding-bottom: 2.5pt">Property and equipment, net</TD><TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; text-align: left">$</TD><TD STYLE="border-bottom: Black 2.5pt double; text-align: right">37,729</TD><TD STYLE="padding-bottom: 2.5pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; text-align: left">$</TD><TD STYLE="border-bottom: Black 2.5pt double; text-align: right">34,513</TD><TD STYLE="padding-bottom: 2.5pt; text-align: left">&nbsp;</TD></TR>
</TABLE>


<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;<B><I>&nbsp;</I></B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B><I><U>Licensing
Agreements</U></I></B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">We
capitalize the costs for our licensing agreements with ABG TapouT, LLC and Salt Tequila USA, LLC, which are amortized to expense
on a straight-line basis over the term of the agreements.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">The
initial amount of the TapouT agreement as entered into by a related party prior to the Company&rsquo;s assumption in 2013 was
$4,000,000 to be paid over several years pursuant to a guaranteed minimum royalty agreement. Royalty costs incurred under the
agreements, guaranteed minimum royalty amounts, are expensed as incurred. See Notes 5 and 13 for further information.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">We
have not made any payments to Salt Tequila USA, LLC under the licensing agreement due to the immaterial nature of our sales from
the brand. See Note 10 for further information.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B>Splash
Beverage Group, Inc.</B></FONT></P>

<P STYLE="border-bottom: Black 1pt solid; font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B>Notes
to the Consolidated Financial Statements</B></FONT></P>


<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 1in; text-align: justify; text-indent: -1in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 1in; text-align: justify; text-indent: -1in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B><U>Note
2 &ndash; Summary of Significant Accounting Policies, continued</U></B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B><I><U>Fair
Value of Financial Instruments </U></I></B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">Financial
Accounting Standards Board (&ldquo;FASB&rdquo;) guidance specifies a hierarchy of valuation techniques based on whether the inputs
to those valuation techniques are observable or unobservable. Observable inputs reflect market data obtained from independent
sources, while unobservable inputs reflect market assumptions. The hierarchy gives the highest priority to unadjusted quoted prices
in active markets for identical assets or liabilities (Level 1 measurement) and the lowest priority to unobservable inputs (Level
3 measurement). The three levels of the fair value hierarchy are as follows:</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B><I>&nbsp;</I></B></FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0; width: 100%"><TR STYLE="vertical-align: top; text-align: justify">
<TD STYLE="text-align: center; width: 0.75in">Level 1</TD><TD STYLE="width: 0.15in; text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">-</FONT></TD><TD STYLE="text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">Unadjusted
                                         quoted prices in active markets for identical assets or liabilities that the reporting
                                         entity has the ability to access at the measurement date. Level 1 primarily consists
                                         of financial instruments whose value is based on quoted market prices such as exchange-traded
                                         instruments and listed equities.</FONT></TD>
</TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 1in; text-align: justify; text-indent: -0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0; width: 100%"><TR STYLE="vertical-align: top; text-align: justify">
<TD STYLE="text-align: center; width: 0.75in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">Level
2</FONT></TD><TD STYLE="width: 0.15in; text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">-</FONT></TD><TD STYLE="text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">Inputs
                                         other than quoted prices included within Level 1 that are observable for the asset or
                                         liability, either directly or indirectly (e.g., quoted prices of similar assets or liabilities
                                         in active markets, or quoted prices for identical or similar assets or liabilities in
                                         markets that are not active).</FONT></TD>
</TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.25in; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0; width: 100%"><TR STYLE="vertical-align: top; text-align: justify">
<TD STYLE="text-align: center; width: 0.75in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">Level
3</FONT></TD><TD STYLE="width: 0.15in; text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">-</FONT></TD><TD STYLE="text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">Unobservable
                                         inputs for the asset or liability. Financial instruments are considered Level 3 when
                                         their fair values are determined using pricing models, discounted cash flows or similar
                                         techniques and at least one significant model assumption or input is unobservable.</FONT></TD>
</TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">The
liabilities and indebtedness presented on the consolidated financial statements approximate fair values at December 31, 2019 and
2018, consistent with recent negotiations of notes payable and due to the short duration of maturities.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B><I>&nbsp;</I></B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B><I><U>Convertible
Instruments</U></I></B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; background-color: white"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">U.S.
GAAP requires the bifurcation of certain conversion rights contained in convertible indebtedness and account for them as free
standing derivative financial instruments according to certain criteria. This criteria include circumstances in which (a)&nbsp;the
economic characteristics and risks of the embedded derivative instrument are not clearly and closely related to the economic characteristics
and risks of the host contract, (b)&nbsp;the hybrid instrument that embodies both the embedded derivative instrument and the host
contract is not re-measured at fair value under otherwise applicable generally accepted accounting principles with changes in
fair value reported in earnings as they occur and (c)&nbsp;a separate instrument with the same terms as the embedded derivative
instrument would be considered a derivative instrument. An exception to this rule is when the host instrument is deemed to be
conventional as that term is described under applicable U.S. GAAP.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; background-color: white"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; background-color: white"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">When
bifurcation is required, the embedded conversion options are bifurcated from the convertible note, resulting in the recognition
of discounts to convertible notes for the intrinsic value of conversion options embedded in debt instruments based upon the differences
between the fair value of the underlying common stock at the commitment date of the note transaction and the effective conversion
price embedded in the note.&nbsp; Debt discounts under these arrangements are amortized over the term of the related debt to their
stated date of redemption.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; background-color: white"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; background-color: white"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; background-color: white"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B>Splash
Beverage Group, Inc.</B></FONT></P>

<P STYLE="border-bottom: Black 1pt solid; font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B>Notes
to the Consolidated Financial Statements</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 1in; text-align: justify; text-indent: -1in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B>&nbsp;</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 1in; text-align: justify; text-indent: -1in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B><U>Note
2 &ndash; Summary of Significant Accounting Policies, continued</U></B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B><I><U>Convertible
Instruments, continued</U></I></B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B><I>&nbsp;</I></B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; background-color: white"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">With
respect to convertible preferred stock, we record a dividend for the intrinsic value of conversion options embedded in preferred
securities based upon the differences between the fair value of the underlying common stock at the commitment date of the transaction
and the effective conversion price embedded in the preferred shares.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B><I><U>Revenue
Recognition</U></I></B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">We
recognize revenue under ASC 606, Revenue from Contracts with Customers (Topic 606). This guidance sets forth a five-step model
which depicts the recognition of revenue in an amount that reflects what we expect to receive in exchange for the transfer of
goods or services to customers.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">We
recognize revenue when our performance obligations under the terms of a contract with the customer are satisfied. Product sales
occur once control of our products is transferred upon delivery to the customer. Revenue is measured as the amount of consideration
that we expect to receive in exchange for transferring goods and is presented net of provisions for customer returns and allowances.
The amount of consideration we receive and revenue we recognize varies with changes in customer incentives we offer to our customers
and their customers. Sales taxes and other similar taxes are excluded from revenue.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">Distribution
expenses to transport our products, where applicable, and warehousing expense after manufacture are accounted for within operating
expenses.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B><I><U>Cost
of Goods Sold</U></I></B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">Cost
of goods sold include the costs of products, packaging, transportation, warehousing, and costs associated with valuation allowances
for expired, damaged or impaired inventory.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B><I><U>Stock-Based
Compensation</U></I></B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">We account for stock-based compensation in
accordance with ASC 718,&nbsp;&ldquo;<I>Compensation - Stock Compensation&rdquo;</I> and ASU 2018-07, &ldquo;Improvements to Nonemployee
Share-Based Payment Accounting&rdquo;. Under the fair value recognition provisions, cost is measured at the grant date based on
the fair value of the award and is recognized as expense ratably over the requisite service period, which is generally the option
vesting period. The Company uses the Black-Scholes option pricing model to determine the fair value of stock options.</P>



<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B><I><U>Income
Taxes</U></I></B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">We
use the liability method of accounting for income taxes as set forth in ASC 740,&nbsp;&ldquo;<I>Income Taxes&rdquo;</I>.&nbsp;&nbsp;Under
the liability method, deferred taxes are determined based on the temporary differences between the financial statement and tax
basis of assets and liabilities using tax rates expected to be in effect during the years in which the basis differences reverse.&nbsp;&nbsp;We
record a valuation allowance when it is not more likely than not that the deferred tax assets will be realized.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">Company
management assesses its income tax positions and records tax benefits for all years subject to examination based upon its evaluation
of the facts, circumstances and information available at the reporting date.&nbsp;&nbsp;In accordance with ASC 740-10, for those
tax positions where there is a greater than 50% likelihood that a tax benefit will be sustained, our policy is to record the largest
amount of tax benefit that is more likely than not to be realized upon ultimate settlement with a taxing authority that has full
knowledge of all relevant information.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 1in; text-align: justify; text-indent: -1in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B>&nbsp;</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 1in; text-align: justify; text-indent: -1in"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 1in; text-align: justify; text-indent: -1in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B>Splash
Beverage Group, Inc.</B></FONT></P>

<P STYLE="border-bottom: Black 1pt solid; font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B>Notes
to the Consolidated Financial Statements</B></FONT></P>


<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 1in; text-align: justify; text-indent: -1in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 1in; text-align: justify; text-indent: -1in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B><U>Note
2 &ndash; Summary of Significant Accounting Policies, continued</U></B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; background-color: white"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B><I><U>Income
Taxes, continued</U></I></B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">For
those income tax positions where there is less than 50% likelihood that a tax benefit will be sustained, no tax benefit will be
recognized in the financial statements. Company management has determined that there are no material uncertain tax positions as
of December 31, 2019 and 2018.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B><I><U>Advertising</U></I></B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">We
conduct advertising for the promotion of our products. In accordance with ASC 720-35, advertising costs are charged to operations
when incurred; such amounts aggregated to $4,767 and $8,148 during the years ended December 31, 2019 and 2018, respectively.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B><I><U>Related
Parties</U></I></B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">We
are indebted to certain members of our Board of Directors as of December 31, 2019 and 2018. Transactions between the Company and
its Board members are summarized in Notes 4 and 9.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B><I><U>Recent
Accounting Pronouncements</U></I></B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">In
May 2014, the FASB issued ASU 2014-09,&nbsp;&ldquo;<I>Revenue from Contracts with Customers</I>&rdquo; (Topic 606).&nbsp;This
ASU supersedes the previous revenue recognition requirements in ASC Topic 605&mdash;Revenue Recognition and most industry-specific
guidance. The core principle within Topic 606 is to recognize revenues when promised goods or services are transferred to customers
in an amount that reflects the consideration expected to be received for those goods or services. Transition methods under ASU
2014-09 must be through either (i) retrospective application to each prior reporting period presented, or (ii) retrospective application
with a cumulative effect adjustment at the date of initial application.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">On January 1, 2018, we adopted ASU 2014-09
Revenue from Contracts with Customers and all subsequent amendments to the ASU (collectively, &ldquo;ASC 606&rdquo;), using the
retrospective application with a cumulative effect adjustment at the date of initial application, which (i) creates a single framework
for recognizing revenue from contracts with customers that fall within its scope and (ii) revises when it is appropriate to recognize
a gain (loss) from the transfer of nonfinancial asset. The adoption did not have a material effect on our Consolidated Financial
Statements.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">In February 2016, the FASB issued ASU
2016-02, &ldquo;<I>Leases</I>&rdquo; (Topic 842). We adopted the standard effective January 1, 2019 using the modified retrospective
method. The adoption of this standard resulted in recognition of a right-of-use asset and a lease liability, initially measured
at the present value of the lease payments, for all leases with a term greater than 12 months. When available, we would use the
rate implicit in the lease to discount lease payments to present value. However, our leases generally do not provide a readily
determinable implicit rate. Therefore, our management estimates the incremental borrowing rate to discount lease payments based
on the information at the lease commencement. The accounting for finance leases is substantially unchanged. Given the nature of
our operation, the adoption of Topic 842 did not have a material impact on our balance sheet, statement of operations, or liquidity.
Refer to Note 11 &ndash; Operating Lease Obligations for information regarding our adoption of Topic 842 and the Company&rsquo;s
undiscounted future lease payments and the timing of those payments.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B>Splash
Beverage Group, Inc.</B></FONT></P>

<P STYLE="border-bottom: Black 1pt solid; font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B>Notes
to the Consolidated Financial Statements</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 1in; text-align: justify; text-indent: -1in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B><U>Note
2 &ndash; Summary of Significant Accounting Policies, continued</U></B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B><I><U>Recent
Accounting Pronouncements, continued</U></I></B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">Management
does not believe that any other recently issued, but not yet effective, accounting standards could have a material effect on the
accompanying financial statements. As new accounting pronouncements are issued, we will adopt those that are applicable under
the circumstances.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><B><I><U>Management&rsquo;s Evaluation</U></I></B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">Management has evaluated subsequent events
through the date the financial statements were issued.</P>



<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B><I><U>Net
Loss Per Share</U></I></B>&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">Basic
net loss per common share (&ldquo;Basic EPS&rsquo;&rsquo;) excludes dilution and is computed by dividing net loss by the weighted
average number of common shares outstanding during the year. Diluted net loss per common share (&ldquo;Diluted EPS&rsquo;&rsquo;)
reflects the potential dilution that could occur if stock options or other contracts to issue shares of common stock were exercised
or converted into common stock. The computation of Diluted EPS does not assume exercise or conversion of securities that would
have an anti-dilutive effect on net loss per common share</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;&nbsp;</FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: 10pt Times New Roman, Times, Serif; border-collapse: collapse; width: 100%">
<TR STYLE="vertical-align: bottom">
    <TD>&nbsp;</TD><TD STYLE="font-weight: bold; padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="border-bottom: Black 1pt solid; font-weight: bold; text-align: center">2019</TD><TD STYLE="padding-bottom: 1pt; font-weight: bold">&nbsp;</TD><TD STYLE="font-weight: bold; padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="border-bottom: Black 1pt solid; font-weight: bold; text-align: center">2018</TD><TD STYLE="padding-bottom: 1pt; font-weight: bold">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD STYLE="font-weight: bold">Numerator</TD><TD>&nbsp;</TD>
    <TD COLSPAN="2" STYLE="text-align: center">&nbsp;</TD><TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD COLSPAN="2" STYLE="text-align: center">&nbsp;</TD><TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="width: 76%; text-align: left">Net loss applicable to common shareholders</TD><TD STYLE="width: 1%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">$</TD><TD STYLE="width: 9%; text-align: right">(5,135,731</TD><TD STYLE="width: 1%; text-align: left">)</TD><TD STYLE="width: 1%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">$</TD><TD STYLE="width: 9%; text-align: right">(3,823,913</TD><TD STYLE="width: 1%; text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-weight: bold">Denominator</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="padding-bottom: 2.5pt">Weighted average number of common shares outstanding</TD><TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 2.5pt double; text-align: right">42,154,948</TD><TD STYLE="padding-bottom: 2.5pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 2.5pt double; text-align: right">36,108,948</TD><TD STYLE="padding-bottom: 2.5pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; padding-bottom: 2.5pt">Net loss per share (basic and diluted)</TD><TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; text-align: left">$</TD><TD STYLE="border-bottom: Black 2.5pt double; text-align: right">(0.12</TD><TD STYLE="padding-bottom: 2.5pt; text-align: left">)</TD><TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; text-align: left">$</TD><TD STYLE="border-bottom: Black 2.5pt double; text-align: right">(0.11</TD><TD STYLE="padding-bottom: 2.5pt; text-align: left">)</TD></TR>
</TABLE>




<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B><U>Note
3 &ndash; Going Concern</U></B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">The accompanying financial statements have
been prepared on a going concern basis, which contemplates the realization of assets and the satisfaction of liabilities in the
normal course of business. &nbsp;Our business operations have not yet generated significant revenues, and we have sustained net
losses of approximately $5.1 million and $3.8 million during the years ended December 31, 2019 and 2018, respectively, and have
an accumulated deficit of approximately $35.6 million and $30.5 million as of December 31, 2019 and 2018, respectively. In addition,
we have current liabilities in excess of current assets of approximately $9.8 million at December 31, 2019. Further, we are in
default on approximately $3.8 million of indebtedness, including accrued interest.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">Our
ability to continue as a going concern in the foreseeable future is dependent upon our ability to generate revenues and obtain
sufficient long-term financing to meet current and future obligations and deploy such to produce profitable operating results.
Management has evaluated these conditions and plans to raise capital as needed and to generate revenues to satisfy our capital
needs. No assurance can be given that we will be successful in these efforts.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">These
factors, among others, raise substantial doubt about our ability to continue as a going concern for a reasonable period of time.
These financial statements do not include any adjustments relating to the recoverability and classification of recorded asset
amounts or the amounts and classification of liabilities that might be necessary should we be unable to continue as a going concern.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B>Splash
Beverage Group, Inc.</B></FONT></P>

<P STYLE="border-bottom: Black 1pt solid; font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B>Notes
to the Consolidated Financial Statements</B></FONT></P>


<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B><U>Note
4 &ndash; Notes Payable, Related Party Notes Payable, Convertible Bridge Loans Payable, Revenue Financing Arrangements and Bridge
Loan Payable</U></B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">Notes
payable are generally nonrecourse and secured by all Company owned assets.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>


<TABLE CELLSPACING="0" CELLPADDING="0" STYLE="font: 12pt Times New Roman, Times, Serif; width: 100%; border-collapse: collapse">
<TR STYLE="vertical-align: bottom">
    <TD STYLE="white-space: nowrap; padding-left: 0.1in">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD COLSPAN="2" STYLE="white-space: nowrap; text-align: center"><FONT STYLE="font-size: 10pt"><B>Interest</B></FONT></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD COLSPAN="2" STYLE="white-space: nowrap">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD COLSPAN="2" STYLE="white-space: nowrap">&nbsp;</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD STYLE="border-bottom: black 1pt solid; white-space: nowrap"><FONT STYLE="font-size: 10pt"><B>Notes Payable</B></FONT></TD>
    <TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="border-bottom: black 1pt solid; white-space: nowrap; text-align: center"><FONT STYLE="font-size: 10pt"><B>Rate</B></FONT></TD>
    <TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="border-bottom: black 1pt solid; white-space: nowrap; text-align: center"><FONT STYLE="font-size: 10pt"><B>2019</B></FONT></TD>
    <TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="border-bottom: black 1pt solid; white-space: nowrap; text-align: center"><FONT STYLE="font-size: 10pt"><B>2018</B></FONT></TD>
    <TD STYLE="padding-bottom: 1pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD STYLE="white-space: nowrap; padding-left: 0.1in">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD COLSPAN="2" STYLE="white-space: nowrap">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD COLSPAN="2" STYLE="white-space: nowrap">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD COLSPAN="2" STYLE="white-space: nowrap">&nbsp;</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: #CCEEFF">
    <TD STYLE="width: 61%; padding-left: 0.1in; text-align: justify"><FONT STYLE="font-size: 10pt">In October 2013, we entered
    into a short-term loan agreement with an entity in the amount of $25,000. The note matured and in March 2020 the full outstanding
    principal balance of $25,000 and unpaid accrued interest of $11,345 was converted into 234,767 shares of common stock according
    to the Merger Agreement.</FONT></TD>
    <TD STYLE="width: 1%">&nbsp;</TD>
    <TD STYLE="width: 1%">&nbsp;</TD>
    <TD STYLE="width: 10%; text-align: right"><FONT STYLE="font-size: 10pt">7</FONT></TD>
    <TD STYLE="width: 1%"><FONT STYLE="font-size: 10pt">%</FONT></TD>
    <TD STYLE="width: 1%">&nbsp;</TD>
    <TD STYLE="width: 1%"><FONT STYLE="font-size: 10pt">$</FONT></TD>
    <TD STYLE="width: 10%; text-align: right"><FONT STYLE="font-size: 10pt">25,000</FONT></TD>
    <TD STYLE="width: 1%">&nbsp;</TD>
    <TD STYLE="width: 1%">&nbsp;</TD>
    <TD STYLE="width: 1%"><FONT STYLE="font-size: 10pt">$</FONT></TD>
    <TD STYLE="width: 10%; text-align: right"><FONT STYLE="font-size: 10pt">25,000</FONT></TD>
    <TD STYLE="width: 1%">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: white">
    <TD STYLE="padding-left: 0.1in">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">&nbsp;</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: #CCEEFF">
    <TD STYLE="padding-left: 0.1in; text-align: justify"><FONT STYLE="font-size: 10pt">In February 2014, we entered into a 12-month
    term loan agreement with an individual in the amount of $200,000. The note included warrants for 68,146 shares of common stock
    at $0.73 per share.&nbsp;&nbsp;The warrants expired on February 28, 2017 and none were exercised at that date. The note matured
    and remains unpaid.</FONT></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">15</FONT></TD>
    <TD><FONT STYLE="font-size: 10pt">%</FONT></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">150,000</FONT></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">150,000</FONT></TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: white">
    <TD STYLE="padding-left: 0.1in">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">&nbsp;</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: #CCEEFF">
    <TD STYLE="padding-left: 0.1in; text-align: justify"><FONT STYLE="font-size: 10pt">In March 2014, we entered into a 12-month
    term loan agreement with an individual in the amount of $500,000.&nbsp;&nbsp;The note included warrants for 681,461 shares
    of common stock at $0.92 per share. The warrants expired on February 28, 2017 and none were exercised at that date.&nbsp;&nbsp;The
    note matured and in March 2020 the full outstanding principal balance of $500,000 and unpaid accrued interest of $373,065
    was converted into 1,124,802 shares of common stock according to the Merger Agreement.</FONT></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">15</FONT></TD>
    <TD><FONT STYLE="font-size: 10pt">%</FONT></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">500,000</FONT></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">500,000</FONT></TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: white">
    <TD STYLE="padding-left: 0.1in">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">&nbsp;</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: #CCEEFF">
    <TD STYLE="padding-left: 0.1in; text-align: justify"><FONT STYLE="font-size: 10pt">In March 2014, we entered into a short-term
    loan agreement with an entity in the amount of $200,000. The note included warrants for 272,584 shares of common stock at
    $0.92 per share. The warrants expired on February 28, 2017 and none were exercised at that date. The loans matured and remain
    unpaid.</FONT></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">8</FONT></TD>
    <TD><FONT STYLE="font-size: 10pt">%</FONT></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">200,000</FONT></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">200,000</FONT></TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: white">
    <TD STYLE="padding-left: 0.1in">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">&nbsp;</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: #CCEEFF">
    <TD STYLE="padding-left: 0.1in">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">&nbsp;</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: white">
    <TD STYLE="padding-bottom: 2.5pt; padding-left: 0.1in">&nbsp;</TD>
    <TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="padding-bottom: 2.5pt; text-align: right">&nbsp;</TD>
    <TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: black 2.25pt double"><FONT STYLE="font-size: 10pt">$</FONT></TD>
    <TD STYLE="border-bottom: black 2.25pt double; text-align: right"><FONT STYLE="font-size: 10pt">875,000</FONT></TD>
    <TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: black 2.25pt double"><FONT STYLE="font-size: 10pt">$</FONT></TD>
    <TD STYLE="border-bottom: black 2.25pt double; text-align: right"><FONT STYLE="font-size: 10pt">875,000</FONT></TD>
    <TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD></TR>
</TABLE>
<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;&nbsp;</FONT></P>




<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">Interest
expense on notes payable was $105,966 and $115,250 for the years ended December 31, 2019 and 2018, respectively, and accrued interest
was $581,693 and $475,728 as of December 31, 2019 and 2018, respectively.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"></P>

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    <DIV STYLE="page-break-before: always; margin-top: 6pt; margin-bottom: 6pt"><P STYLE="margin: 0pt">&nbsp;</P></DIV>
    <!-- Field: /Page -->

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B>Splash
Beverage Group, Inc.</B></FONT></P>

<P STYLE="border-bottom: Black 1pt solid; font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B>Notes
to the Consolidated Financial Statements</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B><U>Note
4 &ndash; Notes Payable, Related Party Notes Payable, Convertible Bridge Loans Payable, Revenue Financing Arrangements and Bridge
Loan Payable, continued</U></B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>
<TABLE CELLSPACING="0" CELLPADDING="0" STYLE="font: 12pt Times New Roman, Times, Serif; width: 100%; border-collapse: collapse">
<TR STYLE="vertical-align: bottom">
    <TD STYLE="white-space: nowrap; padding-left: 0.1in; text-indent: -0.1in">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD COLSPAN="2" STYLE="white-space: nowrap; text-align: center"><FONT STYLE="font-size: 10pt"><B>Interest</B></FONT></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD COLSPAN="2" STYLE="white-space: nowrap">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD COLSPAN="2" STYLE="white-space: nowrap">&nbsp;</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD STYLE="border-bottom: black 1pt solid; white-space: nowrap; padding-left: 0.1in; text-indent: -0.1in"><FONT STYLE="font-size: 10pt"><B>Related
    Parties Notes Payable</B></FONT></TD>
    <TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="border-bottom: black 1pt solid; white-space: nowrap; text-align: center"><FONT STYLE="font-size: 10pt"><B>Rate</B></FONT></TD>
    <TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="border-bottom: black 1pt solid; white-space: nowrap; text-align: center"><FONT STYLE="font-size: 10pt"><B>2019</B></FONT></TD>
    <TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="border-bottom: black 1pt solid; white-space: nowrap; text-align: center"><FONT STYLE="font-size: 10pt"><B>2018</B></FONT></TD>
    <TD STYLE="padding-bottom: 1pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD STYLE="white-space: nowrap; padding-left: 0.1in">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD COLSPAN="2" STYLE="white-space: nowrap">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD COLSPAN="2" STYLE="white-space: nowrap">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD COLSPAN="2" STYLE="white-space: nowrap">&nbsp;</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: #CCEEFF">
    <TD STYLE="width: 61%; padding-left: 0.1in; text-align: justify"><FONT STYLE="font-size: 10pt">During 2012, we entered into
    two 6-month term loan agreements with an entity, totaling $150,000. The notes included warrants for 68,146 shares of common
    stock at $0.73 per share which expired unexercised in 2017. The note matured and in March 2020 the full outstanding principal
    balance of $41,500 and unpaid accrued interest of $31,515 was converted into 98,726 shares of common stock according to the
    Merger Agreement.</FONT></TD>
    <TD STYLE="width: 1%">&nbsp;</TD>
    <TD STYLE="width: 1%">&nbsp;</TD>
    <TD STYLE="width: 10%; text-align: right"><FONT STYLE="font-size: 10pt">7</FONT></TD>
    <TD STYLE="width: 1%"><FONT STYLE="font-size: 10pt">%</FONT></TD>
    <TD STYLE="width: 1%">&nbsp;</TD>
    <TD STYLE="width: 1%"><FONT STYLE="font-size: 10pt">$</FONT></TD>
    <TD STYLE="width: 10%; text-align: right"><FONT STYLE="font-size: 10pt">41,500</FONT></TD>
    <TD STYLE="width: 1%">&nbsp;</TD>
    <TD STYLE="width: 1%">&nbsp;</TD>
    <TD STYLE="width: 1%"><FONT STYLE="font-size: 10pt">$</FONT></TD>
    <TD STYLE="width: 10%; text-align: right"><FONT STYLE="font-size: 10pt">41,500</FONT></TD>
    <TD STYLE="width: 1%">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: white">
    <TD STYLE="padding-left: 0.1in">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">&nbsp;</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: #CCEEFF">
    <TD STYLE="padding-left: 0.1in; text-align: justify"><FONT STYLE="font-size: 10pt">In March 2014, we entered into a $50,000
    12-month term loan agreement. The note included warrants for 136,292 shares of common stock at $0.92 per share. The warrants
    expired unexercised on February 28, 2017.&nbsp;&nbsp;The note matured and in March 2020 the full outstanding principal balance
    of $50,000 and unpaid accrued interest of $24,145 was converted into 99,252 shares of common stock according to the Merger
    Agreement.</FONT></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">8</FONT></TD>
    <TD><FONT STYLE="font-size: 10pt">%</FONT></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">50,000</FONT></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">50,000</FONT></TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: white">
    <TD STYLE="padding-left: 0.1in">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">&nbsp;</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: #CCEEFF">
    <TD STYLE="padding-left: 0.1in; text-align: justify"><FONT STYLE="font-size: 10pt">During 2015, we entered into a 12-month
    term loan agreement with an individual in the amount $250,000.&nbsp;&nbsp;The note matured and in March 2020 the full outstanding
    principal balance of $250,000 and unpaid accrued interest of $101,850 was converted into 98,726 shares of common stock according
    to the Merger Agreement.</FONT></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">8</FONT></TD>
    <TD><FONT STYLE="font-size: 10pt">%</FONT></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">250,000</FONT></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">250,000</FONT></TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: white">
    <TD STYLE="padding-left: 0.1in">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">&nbsp;</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: #CCEEFF">
    <TD STYLE="padding-left: 0.1in; text-align: justify"><FONT STYLE="font-size: 10pt">In February 2012, we entered into a loan
    agreement with an officer of the Company in the amount of $100. On September 25, 2018 an additional $10,500 loan agreement
    was entered into. The note matured and in March 2020 the full outstanding principal balance of $10,600 and unpaid accrued
    interest of $1,189 was converted into 15,734 shares of common stock according to the Merger Agreement.</FONT></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">7</FONT></TD>
    <TD><FONT STYLE="font-size: 10pt">%</FONT></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">10,600</FONT></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">10,600</FONT></TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: white">
    <TD STYLE="padding-left: 0.1in">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">&nbsp;</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: #CCEEFF">
    <TD STYLE="padding-left: 0.1in; text-align: justify"><FONT STYLE="font-size: 10pt">During 2013, 2014, 2015, and 2016, we entered
    into several 12-month term loan agreements with an officer of the Company in the amounts of $57,000, $225,000, $105,000, and
    $9,000, respectively. The note matured and in March 2020 the full outstanding principal balance of $396,000 and unpaid accrued
    interest of $146,828 was converted into 727,344 shares of common stock according to the Merger Agreement.</FONT></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">7</FONT></TD>
    <TD><FONT STYLE="font-size: 10pt">%</FONT></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">396,000</FONT></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">396,000</FONT></TD>
    <TD>&nbsp;</TD></TR>
</TABLE>
<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><I>Continued on next page</I></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

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    <DIV STYLE="page-break-before: always; margin-top: 6pt; margin-bottom: 6pt"><P STYLE="margin: 0pt">&nbsp;</P></DIV>
    <!-- Field: /Page -->

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B>Splash
Beverage Group, Inc.</B></FONT></P>

<P STYLE="border-bottom: Black 1pt solid; font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B>Notes
to the Consolidated Financial Statements</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B><U>Note
4 &ndash; Notes Payable, Related Party Notes Payable, Convertible Bridge Loans Payable, Revenue Financing Arrangements and Bridge
Loan Payable, continued</U></B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>


<TABLE CELLSPACING="0" CELLPADDING="0" STYLE="font: 12pt Times New Roman, Times, Serif; width: 100%; border-collapse: collapse">
<TR STYLE="vertical-align: bottom">
    <TD STYLE="white-space: nowrap; padding-left: 0.1in">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD COLSPAN="2" STYLE="white-space: nowrap; text-align: center"><FONT STYLE="font-size: 10pt"><B>Interest</B></FONT></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD COLSPAN="2" STYLE="white-space: nowrap">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD COLSPAN="2" STYLE="white-space: nowrap">&nbsp;</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD STYLE="border-bottom: black 1pt solid; white-space: nowrap"><FONT STYLE="font-size: 10pt"><B>Related Parties Notes Payable,
    continued</B></FONT></TD>
    <TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="border-bottom: black 1pt solid; white-space: nowrap; text-align: center"><FONT STYLE="font-size: 10pt"><B>Rate</B></FONT></TD>
    <TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="border-bottom: black 1pt solid; white-space: nowrap; text-align: center"><FONT STYLE="font-size: 10pt"><B>2019</B></FONT></TD>
    <TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="border-bottom: black 1pt solid; white-space: nowrap; text-align: center"><FONT STYLE="font-size: 10pt"><B>2018</B></FONT></TD>
    <TD STYLE="padding-bottom: 1pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD STYLE="white-space: nowrap; padding-left: 0.1in">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD COLSPAN="2" STYLE="white-space: nowrap">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD COLSPAN="2" STYLE="white-space: nowrap">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD COLSPAN="2" STYLE="white-space: nowrap">&nbsp;</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: #CCEEFF">
    <TD STYLE="width: 61%; padding-left: 0.1in; text-align: justify"><FONT STYLE="font-size: 10pt">During 2012, 2013, 2014, and
    2016, we entered into 6-month term loan agreements with an officer of the Company in the amounts of $155,000, $210,000, $150,000
    and $40,000, all respectively. The notes included warrants for issuances of 204,438 shares of common stock at $0.92 per share.
    The warrants expired unexercised on March 1, 2017. The note matured and in March 2020 the full outstanding principal balance
    of $495,000 and unpaid accrued interest of $213,010 was converted into 942,504 shares of common stock according to the Merger
    Agreement.</FONT></TD>
    <TD STYLE="width: 1%">&nbsp;</TD>
    <TD STYLE="width: 1%">&nbsp;</TD>
    <TD STYLE="width: 10%; text-align: right"><FONT STYLE="font-size: 10pt">7</FONT></TD>
    <TD STYLE="width: 1%"><FONT STYLE="font-size: 10pt">%</FONT></TD>
    <TD STYLE="width: 1%">&nbsp;</TD>
    <TD STYLE="width: 1%">&nbsp;</TD>
    <TD STYLE="width: 10%; text-align: right"><FONT STYLE="font-size: 10pt">495,000</FONT></TD>
    <TD STYLE="width: 1%">&nbsp;</TD>
    <TD STYLE="width: 1%">&nbsp;</TD>
    <TD STYLE="width: 1%">&nbsp;</TD>
    <TD STYLE="width: 10%; text-align: right"><FONT STYLE="font-size: 10pt">495,000</FONT></TD>
    <TD STYLE="width: 1%">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: white">
    <TD STYLE="padding-left: 0.1in">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">&nbsp;</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: #CCEEFF">
    <TD STYLE="padding-left: 0.1in; text-align: justify"><FONT STYLE="font-size: 10pt">During 2013, 2014 and 2017, we entered
    into 12-month term loan agreements with an officer of the Company in the amounts of $60,000, $50,000 and $10,000. The note
    matured and in March 2020 the full outstanding principal balance of $120,000 and unpaid accrued interest of $50,305 was converted
    into 228,328 shares of common stock according to the Merger Agreement.</FONT></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">7</FONT></TD>
    <TD><FONT STYLE="font-size: 10pt">%</FONT></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">120,000</FONT></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">120,000</FONT></TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: white">
    <TD STYLE="padding-left: 0.1in">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">&nbsp;</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: #CCEEFF">
    <TD STYLE="padding-left: 0.1in; text-align: justify"><FONT STYLE="font-size: 10pt">During 2018, we entered into a long term
    note payable with an entity owned by an officer for $12,000 to be payable on July 10, 2020. In March 2020 the full outstanding
    principal balance of $12,000 and unpaid accrued interest of $1,050 was converted into 17,407 shares of common stock according
    to the Merger Agreement.</FONT></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">12</FONT></TD>
    <TD><FONT STYLE="font-size: 10pt">%</FONT></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">12,000</FONT></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">12,000</FONT></TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: white">
    <TD STYLE="padding-left: 0.1in">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">&nbsp;</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: #CCEEFF">
    <TD STYLE="padding-left: 0.1in; text-align: justify"><FONT STYLE="font-size: 10pt">During 2019, we entered into a term note
    payable with an entity owned by an officer for $130,000 to be paid on August 8, 2019. The note matured and in March 2020 the
    full outstanding principal balance of $130,000 and unpaid accrued interest of $9,078 was converted into 182,525 shares of
    common stock according to the Merger Agreement.</FONT></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">12</FONT></TD>
    <TD><FONT STYLE="font-size: 10pt">%</FONT></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">130,000</FONT></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">-</FONT></TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: white">
    <TD STYLE="padding-left: 0.1in">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">&nbsp;</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: #CCEEFF">
    <TD STYLE="padding-bottom: 2.5pt; padding-left: 0.1in">&nbsp;</TD>
    <TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="padding-bottom: 2.5pt; text-align: right">&nbsp;</TD>
    <TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: black 2.25pt double"><FONT STYLE="font-size: 10pt">$</FONT></TD>
    <TD STYLE="border-bottom: black 2.25pt double; text-align: right"><FONT STYLE="font-size: 10pt">1,505,100</FONT></TD>
    <TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: black 2.25pt double"><FONT STYLE="font-size: 10pt">$</FONT></TD>
    <TD STYLE="border-bottom: black 2.25pt double; text-align: right"><FONT STYLE="font-size: 10pt">1,375,100</FONT></TD>
    <TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD></TR>
</TABLE>
<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">Interest
expense on related party notes payable was $95,183 and $99,532 for the years ended December 31, 2019 and 2018, respectively, and
accrued interest was $546,362 and $426,740 as of December 31, 2019 and 2018, respectively.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"></P>

<!-- Field: Page; Sequence: 16 -->
    <DIV STYLE="border-bottom: Black 1pt solid; margin-top: 6pt; margin-bottom: 6pt"><P STYLE="text-align: center; margin-top: 0pt; margin-bottom: 0pt">&nbsp;F-<!-- Field: Sequence; Type: Arabic; Name: PageNo -->16<!-- Field: /Sequence --></P></DIV>
    <DIV STYLE="page-break-before: always; margin-top: 6pt; margin-bottom: 6pt"><P STYLE="margin: 0pt">&nbsp;</P></DIV>
    <!-- Field: /Page -->

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B>Splash
Beverage Group, Inc.</B></FONT></P>

<P STYLE="border-bottom: Black 1pt solid; font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B>Notes
to the Consolidated Financial Statements</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B><U>Note
4 &ndash; Notes Payable, Related Party Notes Payable, Convertible Bridge Loans Payable, Revenue Financing Arrangements and Bridge
Loan Payable, continued</U></B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;&nbsp;</FONT></P>
<TABLE CELLSPACING="0" CELLPADDING="0" STYLE="font: 12pt Times New Roman, Times, Serif; width: 100%; border-collapse: collapse">
<TR STYLE="vertical-align: bottom">
    <TD STYLE="white-space: nowrap; padding-left: 0.1in">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD COLSPAN="2" STYLE="white-space: nowrap; text-align: center"><FONT STYLE="font-size: 10pt"><B>Interest</B></FONT></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD COLSPAN="2" STYLE="white-space: nowrap">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD COLSPAN="2" STYLE="white-space: nowrap">&nbsp;</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD STYLE="border-bottom: black 1pt solid; white-space: nowrap"><FONT STYLE="font-size: 10pt"><B>Convertible Bridge Loans
    Payable</B></FONT></TD>
    <TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="border-bottom: black 1pt solid; white-space: nowrap; text-align: center"><FONT STYLE="font-size: 10pt"><B>Rate</B></FONT></TD>
    <TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="border-bottom: black 1pt solid; white-space: nowrap; text-align: center"><FONT STYLE="font-size: 10pt"><B>2019</B></FONT></TD>
    <TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="border-bottom: black 1pt solid; white-space: nowrap; text-align: center"><FONT STYLE="font-size: 10pt"><B>2018</B></FONT></TD>
    <TD STYLE="padding-bottom: 1pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD STYLE="white-space: nowrap; padding-left: 0.1in">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD COLSPAN="2" STYLE="white-space: nowrap">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD COLSPAN="2" STYLE="white-space: nowrap">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD COLSPAN="2" STYLE="white-space: nowrap">&nbsp;</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: #CCEEFF">
    <TD STYLE="width: 61%; padding-left: 0.1in; text-align: justify"><FONT STYLE="font-size: 10pt">In May 2015, we entered into
    a 3-month term loan agreement with an individual in the amount of $100,000. The annual interest rate for this bridge loan
    was 32% for the first 90 days, and 4% thereafter, compounded monthly.</FONT></TD>
    <TD STYLE="width: 1%">&nbsp;</TD>
    <TD STYLE="width: 1%">&nbsp;</TD>
    <TD STYLE="width: 10%; text-align: right"><FONT STYLE="font-size: 10pt">See left</FONT></TD>
    <TD STYLE="width: 1%">&nbsp;</TD>
    <TD STYLE="width: 1%">&nbsp;</TD>
    <TD STYLE="width: 1%"><FONT STYLE="font-size: 10pt">$</FONT></TD>
    <TD STYLE="width: 10%; text-align: right"><FONT STYLE="font-size: 10pt">100,000</FONT></TD>
    <TD STYLE="width: 1%">&nbsp;</TD>
    <TD STYLE="width: 1%">&nbsp;</TD>
    <TD STYLE="width: 1%"><FONT STYLE="font-size: 10pt">$</FONT></TD>
    <TD STYLE="width: 10%; text-align: right"><FONT STYLE="font-size: 10pt">100,000</FONT></TD>
    <TD STYLE="width: 1%">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: white">
    <TD STYLE="padding-left: 0.1in">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">&nbsp;</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: #CCEEFF">
    <TD STYLE="padding-left: 0.1in; text-align: justify"><FONT STYLE="font-size: 10pt">In October 2015, we entered into a 3-month
    term loan agreement with two individuals in the amount of $25,000. On December 26, 2018, the outstanding principal and accrued
    interest of $14,388 was consolidated into a new $39,388 term loan due August 26, 2020. In March 2020 the full outstanding
    principal balance of $39,388 and unpaid accrued interest of $5,973 was converted into 59,694 shares of common stock according
    to the Merger Agreement.</FONT></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">12</FONT></TD>
    <TD><FONT STYLE="font-size: 10pt">%</FONT></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">39,388</FONT></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">39,388</FONT></TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: white">
    <TD STYLE="padding-left: 0.1in">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">&nbsp;</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: #CCEEFF">
    <TD STYLE="padding-left: 0.1in; text-align: justify"><FONT STYLE="font-size: 10pt">In June 2015, we entered into a 3-month
    term loan with two individuals in the amount of $100,000. On December 26, 2018, the outstanding principal amount of $100,000
    and accrued interest of $64,307 was consolidated into a new $164,307 term loan due August 26, 2020. In March 2020 the full
    outstanding principal balance of $164,307 and unpaid accrued interest of $24,916 was converted into 249,013 shares of common
    stock according to the Merger Agreement.</FONT></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">12</FONT></TD>
    <TD><FONT STYLE="font-size: 10pt">%</FONT></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">164,307</FONT></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">164,307</FONT></TD>
    <TD>&nbsp;</TD></TR>
</TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><I>Continued on next page</I> &nbsp;</P>



<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"></P>

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    <DIV STYLE="page-break-before: always; margin-top: 6pt; margin-bottom: 6pt"><P STYLE="margin: 0pt">&nbsp;</P></DIV>
    <!-- Field: /Page -->

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;<FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B>&nbsp;</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B>Splash
Beverage Group, Inc.</B></FONT></P>

<P STYLE="border-bottom: Black 1pt solid; font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B>Notes
to the Consolidated Financial Statements</B></FONT></P>


<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B><U>Note
4 &ndash; Notes Payable, Related Party Notes Payable, Convertible Bridge Loans Payable, Revenue Financing Arrangements and Bridge
Loan Payable, continued</U></B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>


<TABLE CELLSPACING="0" CELLPADDING="0" STYLE="font: 12pt Times New Roman, Times, Serif; width: 100%; border-collapse: collapse">
<TR STYLE="vertical-align: bottom">
    <TD STYLE="white-space: nowrap; padding-left: 0.1in">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD COLSPAN="2" STYLE="white-space: nowrap; text-align: center"><FONT STYLE="font-size: 10pt"><B>Interest</B></FONT></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD COLSPAN="2" STYLE="white-space: nowrap">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD COLSPAN="2" STYLE="white-space: nowrap">&nbsp;</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD STYLE="border-bottom: black 1pt solid; white-space: nowrap"><FONT STYLE="font-size: 10pt"><B>Convertible Bridge Loans
    Payable, continued</B></FONT></TD>
    <TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="border-bottom: black 1pt solid; white-space: nowrap; text-align: center"><FONT STYLE="font-size: 10pt"><B>Rate</B></FONT></TD>
    <TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="border-bottom: black 1pt solid; white-space: nowrap; text-align: center"><FONT STYLE="font-size: 10pt"><B>2019</B></FONT></TD>
    <TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="border-bottom: black 1pt solid; white-space: nowrap; text-align: center"><FONT STYLE="font-size: 10pt"><B>2018</B></FONT></TD>
    <TD STYLE="padding-bottom: 1pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD STYLE="white-space: nowrap; padding-left: 0.1in">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD COLSPAN="2" STYLE="white-space: nowrap">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD COLSPAN="2" STYLE="white-space: nowrap">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD COLSPAN="2" STYLE="white-space: nowrap">&nbsp;</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: #CCEEFF">
    <TD STYLE="width: 61%; padding-left: 0.1in; text-align: justify"><FONT STYLE="font-size: 10pt">During 2016, 2017 and 2018,
    we entered into multiple loan agreements with an entity in varying amounts. On December 26, 2018, the outstanding principal
    of $235,500 and accrued interest of $155,861 was consolidated into a new $391,361 term due August 26, 2020. In March 2020
    the full outstanding principal balance of $391,361 and unpaid accrued interest of $43,823 was converted into 435,184 shares
    of common stock according to the Merger Agreement.</FONT></TD>
    <TD STYLE="width: 1%">&nbsp;</TD>
    <TD STYLE="width: 1%">&nbsp;</TD>
    <TD STYLE="width: 10%; text-align: right"><FONT STYLE="font-size: 10pt">12</FONT></TD>
    <TD STYLE="width: 1%"><FONT STYLE="font-size: 10pt">%</FONT></TD>
    <TD STYLE="width: 1%">&nbsp;</TD>
    <TD STYLE="width: 1%">&nbsp;</TD>
    <TD STYLE="width: 10%; text-align: right"><FONT STYLE="font-size: 10pt">391,361</FONT></TD>
    <TD STYLE="width: 1%">&nbsp;</TD>
    <TD STYLE="width: 1%">&nbsp;</TD>
    <TD STYLE="width: 1%">&nbsp;</TD>
    <TD STYLE="width: 10%; text-align: right"><FONT STYLE="font-size: 10pt">391,361</FONT></TD>
    <TD STYLE="width: 1%">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: white">
    <TD STYLE="padding-left: 0.1in">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">&nbsp;</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: #CCEEFF">
    <TD STYLE="padding-left: 0.1in; text-align: justify"><FONT STYLE="font-size: 10pt">During 2016, we entered into 3-month term
    loan agreements with an individual totaling $20,000. The loan was extended to August 14, 2020. In March 2020 the full outstanding
    principal balance of $20,000 and unpaid accrued interest of $10,096 was converted into 41,336 shares of common stock according
    to the Merger Agreement.</FONT></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">9</FONT></TD>
    <TD><FONT STYLE="font-size: 10pt">%</FONT></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">20,000</FONT></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">20,000</FONT></TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: white">
    <TD STYLE="padding-left: 0.1in">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">&nbsp;</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: #CCEEFF">
    <TD STYLE="padding-left: 0.1in; text-align: justify"><FONT STYLE="font-size: 10pt">During 2014 through 2018, we entered into
    convertible promissory note agreements with various terms ranging from 90 days to 18 months at 18% interest with an entity
    which were consolidated into one loan at 12% in 2018 totaling $795,137 with a due date of August 26, 2020. In March 2020 the
    full outstanding principal balance of $795,137 and unpaid accrued interest of $89,037 was converted into 884,174 shares of
    common stock according to the Merger Agreement.</FONT></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">12</FONT></TD>
    <TD><FONT STYLE="font-size: 10pt">%</FONT></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">795,137</FONT></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">795,137</FONT></TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: white">
    <TD STYLE="padding-left: 0.1in">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">&nbsp;</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: #CCEEFF">
    <TD STYLE="padding-left: 0.1in; text-align: justify"><FONT STYLE="font-size: 10pt">During 2015 and 2016, we entered into a
    series of 3-month term convertible promissory note agreements at 18% interest with an entity which were consolidated into
    one loan at 12% in 2018 totaling $692,471 with a due date of August 26, 2020. In March 2020 the full outstanding principal
    balance of $692,471 and unpaid accrued interest of $77,541 was converted into 770,012 shares of common stock according to
    the Merger Agreement.</FONT></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">12</FONT></TD>
    <TD><FONT STYLE="font-size: 10pt">%</FONT></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">692,471</FONT></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">692,471</FONT></TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: white">
    <TD STYLE="padding-left: 0.1in">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">&nbsp;</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: #CCEEFF">
    <TD STYLE="padding-bottom: 2.5pt; padding-left: 0.1in">&nbsp;</TD>
    <TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="padding-bottom: 2.5pt; text-align: right">&nbsp;</TD>
    <TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: black 2.25pt double"><FONT STYLE="font-size: 10pt">$</FONT></TD>
    <TD STYLE="border-bottom: black 2.25pt double; text-align: right"><FONT STYLE="font-size: 10pt">2,202,664</FONT></TD>
    <TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: black 2.25pt double"><FONT STYLE="font-size: 10pt">$</FONT></TD>
    <TD STYLE="border-bottom: black 2.25pt double; text-align: right"><FONT STYLE="font-size: 10pt">2,202,664</FONT></TD>
    <TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD></TR>
</TABLE>
<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"></P>




<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">Interest
expense on the convertible bridge loans payable was $310,865 and $430,317 for the years ended December 31, 2019 and 2018, respectively,
and accrued interest was $439,344 and $489,015 as of December 31, 2019 and 2018, respectively.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"></P>

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    <DIV STYLE="page-break-before: always; margin-top: 6pt; margin-bottom: 6pt"><P STYLE="margin: 0pt">&nbsp;</P></DIV>
    <!-- Field: /Page -->

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B>Splash
Beverage Group, Inc.</B></FONT></P>

<P STYLE="border-bottom: Black 1pt solid; font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B>Notes
to the Consolidated Financial Statements</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B><U>Note
4 &ndash; Notes Payable, Related Party Notes Payable, Convertible Bridge Loans Payable, Revenue Financing Arrangements and Bridge
Loan Payable, continued</U></B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: 10pt Times New Roman, Times, Serif; border-collapse: collapse; width: 100%">
<TR STYLE="vertical-align: bottom">
    <TD STYLE="padding-left: 0.1in; white-space: nowrap">&nbsp;</TD><TD STYLE="font-weight: bold">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="white-space: nowrap; font-weight: bold; text-align: center">Interest</TD><TD STYLE="font-weight: bold">&nbsp;</TD><TD>&nbsp;</TD>
    <TD COLSPAN="2" STYLE="white-space: nowrap">&nbsp;</TD><TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD COLSPAN="2" STYLE="white-space: nowrap">&nbsp;</TD><TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD STYLE="border-bottom: Black 1pt solid; padding-left: 0in; white-space: nowrap; font-weight: bold">Revenue Financing Arrangements</TD><TD STYLE="font-weight: bold; padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="border-bottom: Black 1pt solid; white-space: nowrap; font-weight: bold; text-align: center">Rate</TD><TD STYLE="padding-bottom: 1pt; font-weight: bold">&nbsp;</TD><TD STYLE="font-weight: bold; padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="border-bottom: Black 1pt solid; white-space: nowrap; font-weight: bold; text-align: center">2019</TD><TD STYLE="padding-bottom: 1pt; font-weight: bold">&nbsp;</TD><TD STYLE="font-weight: bold; padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="border-bottom: Black 1pt solid; white-space: nowrap; font-weight: bold; text-align: center">2018</TD><TD STYLE="padding-bottom: 1pt; font-weight: bold">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD STYLE="padding-left: 0.1in; white-space: nowrap">&nbsp;</TD><TD>&nbsp;</TD>
    <TD COLSPAN="2" STYLE="white-space: nowrap">&nbsp;</TD><TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD COLSPAN="2" STYLE="white-space: nowrap">&nbsp;</TD><TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD COLSPAN="2" STYLE="white-space: nowrap">&nbsp;</TD><TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="padding-left: 0.1in; width: 61%; text-align: justify">During August 2015, we entered into a 3-month term loan agreement
    with an entity in the amount of $50,000, with required daily payments of $999. We entered into two additional 3-month loan
    agreements with the entity in 2016 in the amounts of $60,000 and $57,000, with required daily payments of $928 and $713, respectively.&nbsp;&nbsp;&nbsp;The
    term loans matured and remains unpaid.</TD><TD STYLE="width: 1%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 10%; text-align: right">10</TD><TD STYLE="width: 1%; text-align: left">%</TD><TD STYLE="width: 1%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 10%; text-align: right">28,032</TD><TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 1%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 10%; text-align: right">28,032</TD><TD STYLE="width: 1%; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="padding-left: 0.1in">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="padding-left: 0.1in; text-align: justify">During September 2016, the Company entered into a short-term loan agreement
    with an entity in the amount of $55,000 with required daily payments of $929. The note was paid off in 2019.</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">15</TD><TD STYLE="text-align: left">%</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">-</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">15,009</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="padding-left: 0.1in">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="padding-left: 0.1in; text-align: justify">During November 2016, we entered into a short-term loan agreement with
    an entity in the amount of $55,000 with required daily payments of $1,299. The note was in default as of December 31, 2018.
    In 2019, we entered into a settlement agreement with monthly installment payments of $6,000.&nbsp;&nbsp;The loan is scheduled
    to be fully repaid in 2020.</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">12</TD><TD STYLE="text-align: left">%</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">17,435</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">34,067</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="padding-left: 0.1in">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="padding-left: 0.1in; padding-bottom: 2.5pt">&nbsp;</TD><TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="padding-bottom: 2.5pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 2.5pt; text-align: right">&nbsp;</TD><TD STYLE="padding-bottom: 2.5pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; text-align: left">$</TD><TD STYLE="border-bottom: Black 2.5pt double; text-align: right">45,467</TD><TD STYLE="padding-bottom: 2.5pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; text-align: left">$</TD><TD STYLE="border-bottom: Black 2.5pt double; text-align: right">77,108</TD><TD STYLE="padding-bottom: 2.5pt; text-align: left">&nbsp;</TD></TR>
</TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">Interest
expense on the revenue financing arrangements was $2,577 and $11,132 for the years ended December 31, 2019 and 2018, respectively,
and accrued interest was $32,154 and $126,333 as of December 31, 2019 and 2018, respectively.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B><I><U>Bridge
Loan Payable</U></I></B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">We
issued an additional bridge loan in October 2018 for $2 million with a one-year maturity to GMA Bridge Fund LLC (&ldquo;GMA&rdquo;).
This bridge loan contains a 10% administration fee of which the full $200,000 was accrued at December 31, 2019 and included in
bridge loan payable, net. We incurred $271,670 of loan costs, which was fully amortized at December 31, 2019. Interest on the
bridge loan was 0.5% monthly for the first six months and 0.75% monthly for the next six months. At the same time the debt was
issued, we entered into a separate agreement in which GMA provided consulting services for one year (&ldquo;Consulting Agreement&rdquo;).
We compensated GMA for the Consulting Agreement services by issuance of a warrant with a 5-year term to acquire 1,362,922 shares
of our common stock at an exercise price of $0.007 per share. The warrant vested immediately. The value of the warrant, based
on a Black-Scholes option pricing model, was $991,423 and was expensed in full in 2018. Interest expense on the bridge loan for
the years ended December 31, 2019 and 2018 was $137,637 and $28,603, respectively, and accrued interest at December 31, 2019 was
$166,240. </FONT>As part of the merger, these warrants were retired.</P>



<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B>Splash
Beverage Group, Inc.</B></FONT></P>

<P STYLE="border-bottom: Black 1pt solid; font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B>Notes
to the Consolidated Financial Statements</B></FONT></P>


<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B><U>Note
4 &ndash; Notes Payable, Related Party Notes Payable, Convertible Bridge Loans Payable, Revenue Financing Arrangements and Bridge
Loan Payable, continued</U></B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B><I><U>Future
Minimum Debt Payments</U></I></B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">Future
minimum debt payments under the Company&rsquo;s outstanding loans are as follows as of December 31, 2019:</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: 10pt Times New Roman, Times, Serif; border-collapse: collapse; width: 100%">
<TR STYLE="vertical-align: bottom">
    <TD STYLE="text-align: left; white-space: nowrap">&nbsp;</TD><TD STYLE="font-weight: bold">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="white-space: nowrap; font-weight: bold; text-align: center">Related</TD><TD STYLE="font-weight: bold">&nbsp;</TD><TD>&nbsp;</TD>
    <TD COLSPAN="2" STYLE="white-space: nowrap">&nbsp;</TD><TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD COLSPAN="2" STYLE="white-space: nowrap">&nbsp;</TD><TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD STYLE="text-align: left; white-space: nowrap">&nbsp;</TD><TD STYLE="font-weight: bold; padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="border-bottom: Black 1pt solid; white-space: nowrap; font-weight: bold; text-align: center">Party</TD><TD STYLE="padding-bottom: 1pt; font-weight: bold">&nbsp;</TD><TD STYLE="font-weight: bold; padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="border-bottom: Black 1pt solid; white-space: nowrap; font-weight: bold; text-align: center">Other</TD><TD STYLE="padding-bottom: 1pt; font-weight: bold">&nbsp;</TD><TD STYLE="font-weight: bold; padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="border-bottom: Black 1pt solid; white-space: nowrap; font-weight: bold; text-align: center">Total</TD><TD STYLE="padding-bottom: 1pt; font-weight: bold">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD STYLE="text-align: left; white-space: nowrap">&nbsp;</TD><TD>&nbsp;</TD>
    <TD COLSPAN="2" STYLE="white-space: nowrap">&nbsp;</TD><TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD COLSPAN="2" STYLE="white-space: nowrap">&nbsp;</TD><TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD COLSPAN="2" STYLE="white-space: nowrap">&nbsp;</TD><TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="text-align: left; width: 61%">2020</TD><TD STYLE="width: 1%">&nbsp;</TD>
    <TD STYLE="text-align: left; width: 1%">&nbsp;</TD><TD STYLE="text-align: right; width: 10%">1,505,100</TD><TD STYLE="text-align: left; width: 1%">&nbsp;</TD><TD STYLE="width: 1%">&nbsp;</TD>
    <TD STYLE="text-align: left; width: 1%">&nbsp;</TD><TD STYLE="text-align: right; width: 10%">5,277,664</TD><TD STYLE="text-align: left; width: 1%">&nbsp;</TD><TD STYLE="width: 1%">&nbsp;</TD>
    <TD STYLE="text-align: left; width: 1%">&nbsp;</TD><TD STYLE="text-align: right; width: 10%">6,782,764</TD><TD STYLE="text-align: left; width: 1%">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; padding-bottom: 1pt">Thereafter</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">-</TD><TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">-</TD><TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">-</TD><TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="padding-left: 0.1in; text-align: left; padding-bottom: 2.5pt">Total</TD><TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; text-align: left">$</TD><TD STYLE="border-bottom: Black 2.5pt double; text-align: right">1,505,100</TD><TD STYLE="padding-bottom: 2.5pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; text-align: left">$</TD><TD STYLE="border-bottom: Black 2.5pt double; text-align: right">5,277,664</TD><TD STYLE="padding-bottom: 2.5pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; text-align: left">$</TD><TD STYLE="border-bottom: Black 2.5pt double; text-align: right">6,782,764</TD><TD STYLE="padding-bottom: 2.5pt; text-align: left">&nbsp;</TD></TR>
</TABLE>


<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B><U>Note
5 &ndash; Licensing Agreement and Royalty Payable</U></B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">During
2012, we entered into an assignment agreement with ABG TapouT, LLC (&ldquo;TapouT&rdquo;) to obtain the licensing rights of the
brand &ldquo;TapouT&rdquo; on energy drinks, energy shots, water, teas and sports drinks for beverages sold in the United States
of America, its territories, possessions, U.S. military bases and Mexico. Under the terms of the agreement, we are required to
pay ABG Tapout, LLC a 6% royalty on net sales (gross revenue less discounts and allowances). The agreement requires us to make
varying guaranteed minimum royalty payments in the total amount of $3,500,000 for the initial period of 5 years beginning in 2012.
The terms of the license agreement were subsequently amended on several occasions between 2012 and 2016. During April 2017, the
license agreement was again amended, to extend the term through December 31, 2018 with a 5-year renewal option if $5 million of
net sales were achieved in 2018. The amendment also stated we were required to make a $30,000 payment on the date of the executed
amendment, monthly payments of $30,000 starting on April 30, 2017 through December 31, 2017, and monthly payments of $26,484 starting
on January 31, 2018 through December 31, 2018. We did not achieve the minimum net sales requirement per the amendment terms for
2018. In 2019 the agreement was once again amended extending the term through December 31, 2019. Per the 2019 amendment, the Company
is required to make twelve monthly payments of $39,000. See Note 13.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">The
unpaid amount of royalties was $39,000 and $21,062 as of December 31, 2019 and 2018, respectively. Guaranteed minimum royalty
payments totaled $468,000 and $326,750 for the years ended December 31, 2019 and 2018, respectively, which is included in other
general and administrative expenses.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B><U>Note
6 &ndash; Income Taxes</U></B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">We
have evaluated the positive and negative evidence in assessing the realizability of its deferred tax assets. This assessment included
the evaluation of scheduled reversals of deferred tax liabilities, estimates of projected future taxable income and tax planning
strategies to determine which deferred tax assets are more likely than not to be realized in the future.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B>Splash
Beverage Group, Inc.</B></FONT></P>

<P STYLE="border-bottom: Black 1pt solid; font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B>Notes
to the Consolidated Financial Statements</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B><U>Note
6 &ndash; Income Taxes, continued</U></B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">At December 31, 2019, our net operating loss
carryforward for Federal income tax purposes was approximately $23.2 million, which will be available to offset future taxable
income subject to potential annual limitations. If not used, these carry forwards will begin to expire in 2032, except for the
current year net operating loss generated which can be carried forward indefinitely.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">There was no income tax expense or benefit
for the year ended December 31, 2019 and 2018 due to the full valuation allowance recorded in each period.</P>



<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">The
reconciliation of the income tax benefit is computed at the U.S. federal statutory rate as follows:</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: 10pt Times New Roman, Times, Serif; border-collapse: collapse; width: 100%">
<TR STYLE="vertical-align: bottom">
    <TD>&nbsp;</TD><TD STYLE="font-weight: bold; padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="border-bottom: Black 1pt solid; font-weight: bold; text-align: center">2019</TD><TD STYLE="padding-bottom: 1pt; font-weight: bold">&nbsp;</TD><TD STYLE="font-weight: bold; padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="border-bottom: Black 1pt solid; font-weight: bold; text-align: center">2018</TD><TD STYLE="padding-bottom: 1pt; font-weight: bold">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD COLSPAN="2">&nbsp;</TD><TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD COLSPAN="2">&nbsp;</TD><TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="width: 76%; text-align: left">US federal statutory tax rate</TD><TD STYLE="width: 1%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 9%; text-align: right">21.00</TD><TD STYLE="width: 1%; text-align: left">%</TD><TD STYLE="width: 1%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 9%; text-align: right">21.00</TD><TD STYLE="width: 1%; text-align: left">%</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left">Permanent differences</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">-6.56</TD><TD STYLE="text-align: left">%</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">-0.03</TD><TD STYLE="text-align: left">%</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="text-align: left; padding-bottom: 1pt">Change in valuation allowance</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">-14.44</TD><TD STYLE="padding-bottom: 1pt; text-align: left">%</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">-20.97</TD><TD STYLE="padding-bottom: 1pt; text-align: left">%</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="padding-left: 0.125in; padding-bottom: 2.5pt">Total</TD><TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 2.5pt double; text-align: right">0.00</TD><TD STYLE="padding-bottom: 2.5pt; text-align: left">%</TD><TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 2.5pt double; text-align: right">0.00</TD><TD STYLE="padding-bottom: 2.5pt; text-align: left">%</TD></TR>
</TABLE>



<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">The
tax effects of temporary differences which give rise to the significant portions of deferred tax assets or liabilities at December
31 are as follows:</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: 10pt Times New Roman, Times, Serif; border-collapse: collapse; width: 100%">
<TR STYLE="vertical-align: bottom">
    <TD>&nbsp;</TD><TD STYLE="font-weight: bold; padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="border-bottom: Black 1pt solid; font-weight: bold; text-align: center">2019</TD><TD STYLE="padding-bottom: 1pt; font-weight: bold">&nbsp;</TD><TD STYLE="font-weight: bold; padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="border-bottom: Black 1pt solid; font-weight: bold; text-align: center">2018</TD><TD STYLE="padding-bottom: 1pt; font-weight: bold">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD COLSPAN="2">&nbsp;</TD><TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD COLSPAN="2">&nbsp;</TD><TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD STYLE="font-weight: bold">Deferred tax assets:</TD><TD>&nbsp;</TD>
    <TD COLSPAN="2">&nbsp;</TD><TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD COLSPAN="2">&nbsp;</TD><TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="padding-left: 0.125in; width: 76%; text-align: left">Net operating losses</TD><TD STYLE="width: 1%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">$</TD><TD STYLE="width: 9%; text-align: right">5,887,022</TD><TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 1%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">$</TD><TD STYLE="width: 9%; text-align: right">5,315,433</TD><TD STYLE="width: 1%; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="padding-left: 0.125in; text-align: left">Deferred rent</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">1,381</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">-</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="padding-left: 0.125in; text-align: left; padding-bottom: 1pt">Accrued expenses/interest expense limitation</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">962,838</TD><TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">641,141</TD><TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="padding-left: 0.25in; text-align: left">Total deferred tax assets</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">6,851,241</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">5,956,574</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-weight: bold; text-align: left">Deferred tax liabilities:</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="padding-left: 0.125in; padding-bottom: 1pt">Depreciation</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">(7,354</TD><TD STYLE="padding-bottom: 1pt; text-align: left">)</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">(7,666</TD><TD STYLE="padding-bottom: 1pt; text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="padding-left: 0.25in; text-align: left">Total deferred tax liabilities</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">(7,354</TD><TD STYLE="text-align: left">)</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">(7,666</TD><TD STYLE="text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="padding-left: 0.125in; text-align: left; padding-bottom: 1pt">Less: valuation allowance</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">(6,843,887</TD><TD STYLE="padding-bottom: 1pt; text-align: left">)</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">(5,948,908</TD><TD STYLE="padding-bottom: 1pt; text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="padding-left: 0.25in; text-align: left; padding-bottom: 2.5pt">Total net deferred tax liabilities</TD><TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; text-align: left">$</TD><TD STYLE="border-bottom: Black 2.5pt double; text-align: right">-</TD><TD STYLE="padding-bottom: 2.5pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; text-align: left">$</TD><TD STYLE="border-bottom: Black 2.5pt double; text-align: right">-</TD><TD STYLE="padding-bottom: 2.5pt; text-align: left">&nbsp;</TD></TR>
</TABLE>



<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">We
continually evaluate expiring statutes of limitations, audits, proposed settlements, changes in tax law and new authoritative
rulings. The open tax years subject to examination with respect to our operations are 2015 through 2019.&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B>Splash
Beverage Group, Inc.</B></FONT></P>

<P STYLE="border-bottom: Black 1pt solid; font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B>Notes
to the Consolidated Financial Statements</B></FONT></P>


<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B><U>Note
7 &ndash; Deficiency in Stockholders&rsquo; Equity</U></B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B>&nbsp;</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B><I><U>Common
Stock</U></I></B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">In
2019, we issued 1,846,078 shares of our common stock in exchange for services provided to us. The shares were valued at $0.73
per share. We recognized share-based compensation expense of $1,354,500, which is classified within the contracted services line
on the Statement of Operations.</FONT></P>


<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B>&nbsp;</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">In 2018, we issued 906,090 shares of common
stock valued at $0.73 per share in exchange for services provided to the Company.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">On May 28, 2018, we issued to a consultant
or its designees common stock equal to 718,682 shares in exchange for services provided to the Company.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">In December 2018, the full outstanding principal
balance of a bridge note of $175,000 and unpaid accrued interest balance of $144,410 was converted to 290,220 shares of the Company&rsquo;s
common stock at $1.10 per share.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">In October 2018, the full outstanding principal
balance of a bridge note of $200,000 and unpaid accrued interest balance of $165,040 was converted to 331,681 shares of the Company&rsquo;s
common stock at $1.10 per share.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">Certain common shareholders have the right
to exchange their common shares for shares of preferred stock or convertible debt if the Company is unable to achieve the capital
raise event as defined in the Merger Agreement by September 30, 2020 (see Note 13). Shares would consist of:</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.25in"></TD><TD STYLE="width: 0.25in"><FONT STYLE="font-family: Symbol">&middot;</FONT></TD><TD STYLE="text-align: justify">Series
                                         A Convertible Preferred Stock &ndash; 6,276,432</TD></TR></TABLE>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.25in"></TD><TD STYLE="width: 0.25in"><FONT STYLE="font-family: Symbol">&middot;</FONT></TD><TD STYLE="text-align: justify">Series
                                         B Convertible Preferred Stock &ndash; 7,653,981</TD></TR></TABLE>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.25in"></TD><TD STYLE="width: 0.25in"><FONT STYLE="font-family: Symbol">&middot;</FONT></TD><TD STYLE="text-align: justify">Convertible
                                         Debt &ndash; 10,560,090</TD></TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;&nbsp;<FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B>&nbsp;&nbsp;&nbsp;</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><U STYLE="text-decoration: none">As
of December 31, 2019, the convertible debt was still classified as debt on the balance sheet.</U></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B>&nbsp;&nbsp;</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B><I><U>Series
A and B Convertible Preferred Stock</U></I></B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">As part of the merger consummated on March
31, 2020, all series A and B convertible preferred stock were converted to common stock. If the Company is unable to achieve the
capital raise event as defined in the Merger Agreement by September 30, 2020, these shareholders can rescind their common shares
back to preferred shares. Below are the new rights to these shareholders if they decide to rescind:</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B><U>Series
A Convertible Preferred Stock</U></B>:</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">Rank. The Series A Preferred Stock shall rank, with respect
to dividend rights and to rights upon any voluntary or involuntary liquidation, dissolution or winding up of the Company (each,
a &ldquo;Liquidation Event&rdquo;), (a) senior in preference and priority to the common stock of the Company (the &ldquo;Common
Stock&rdquo;) and any other class or series of equity security established and designated by the Board of Directors the terms of
which do not expressly provide that it ranks senior in preference or priority to or on parity with the Series A Preferred Stock
with respect to dividend rights and rights upon a Liquidation Event (collectively, &ldquo;Junior Securities&rdquo;), (b) on parity,
without preference or priority, with each other class or series of equity security established and designated by the Board of Directors
the terms of which expressly provide that it ranks on parity, without preference or priority to, the Series A Preferred Stock with
respect to dividend rights and rights upon a Liquidation Event (collectively, &ldquo;Parity Securities&rdquo;), and (c) junior
in preference and priority to each other class or series of equity security established and designated by the Board of Directors
the terms of which expressly provide that it ranks senior in preference or priority to the Series A Preferred Stock with respect
to dividend rights and rights upon a Liquidation Event (collectively, &ldquo;Senior Securities&rdquo;).</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">Dividends.
Holders of shares of the Series A Preferred Stock are entitled to receive, when, as and if declared by the Board, out of funds
legally available for the payment of dividends, cumulative cash dividends at an annual rate of eight percent (8%) of the Original
Issue Price per share (equal to $.08 per share per annum). Dividends shall accrue on each share of Series A Preferred Stock from
the date of issuance thereof, whether paid or not, and shall be cumulative and compounded annually.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">Liquidation
Preference. In the event of any Liquidation Event, the holders of shares of Series A Preferred Stock then outstanding shall be
entitled to be paid out of the assets of the Company available for distribution to its stockholders before any payment shall be
made to the holders of any Junior Securities by reason of their ownership thereof, an amount per share equal to one hundred fifty
percent (150%) of the Series A Original Issue Price (the &ldquo;Liquidation Preference&rdquo;), plus the amount of accrued and
unpaid dividends thereon from the Original Issue Date through the date of liquidation. If upon any such Liquidation Event the
assets of the Company available for distribution to its stockholders shall be insufficient to pay the holders of shares of Series
A Preferred Stock the full amount to which they shall be entitled under this, the holders of shares of Series A Preferred Stock
and Parity Securities shall share ratably in any distribution of the assets available for distribution in proportion to the respective
amounts which would otherwise be payable in respect of the shares held by them upon such distribution if all amounts payable on
or with respect to such shares were paid in full.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">Conversion.
The holders of Series A Preferred Stock shall have conversion rights as follows (the &ldquo;Conversion Rights&rdquo;):</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">Optional
Conversion. Each share of Series A Preferred Stock shall be convertible, at the option of the holder thereof, at any time and
from time to time, into such number of fully paid and non-assessable shares of Common Stock as is determined by dividing the Series
A Original Issue Price by the Conversion Price (as defined below) in effect at the time of conversion. The Conversion Price at
which shares of Common Stock shall be deliverable upon conversion of Series A Preferred Stock without the payment of additional
consideration by the holder thereof (the &ldquo;Conversion Price&rdquo;) shall initially be $1.28 per share. Such initial Conversion
Price, and the rate at which shares of Series A Preferred Stock may be converted into shares of Common Stock, shall be subject
to adjustment as provided below. All accrued and unpaid dividends may be converted by each holder of Series A Preferred Stock
into Common Stock by first determining the number of shares of Series A Preferred Stock that could be purchased based on the Series
A Original Issue Price then in effect and then determining the number of shares of Common Stock such additional shares of Series
A Preferred Stock are convertible into. By way of illustration only, if the accrued and unpaid dividends are equal to $100,000,
then based on the Series A Original Issue Price of $1.00 and a Conversion Price of $0.85, the holders of Series A Preferred Stock
would receive an additional 85,000 shares of Common Stock.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">Automatic
Conversion. Upon the consummation of an underwritten public offering of the Common Stock of the Company (&ldquo;IPO&rdquo;) ,
each share of Series A Preferred Stock shall automatically be converted into such number of fully paid and non-assessable shares
of Common Stock at a Conversion Price equal to the lesser of (i) the Conversion Price in effect immediately prior to the consummation
of the IPO or (ii) fifty percent (50%) of the public offering price of the Common Stock in the IPO. All accrued and unpaid dividends
may be converted by each holder of Series A Preferred Stock into Common Stock by first determining the number of shares of Series
A Preferred Stock that could be purchased based on the Series A Original Issue Price then in effect and then determining the number
of shares of Common Stock such additional shares of Series A Preferred Stock are convertible into. By way of illustration only,
if the accrued and unpaid dividends are equal to $100,000, then based on the Series A Original Issue Price of $1.00 and a Conversion
Price of $0.85, the holders of Series A Preferred Stock would receive an additional 85,000 shares of Common Stock.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B><U>Series
B Convertible Preferred Stock</U></B>:</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">Rank.
The Series B Preferred Stock shall rank, with respect to dividend rights and to rights upon any voluntary or involuntary liquidation,
dissolution or winding up of the Company (each, a &ldquo;Liquidation Event&rdquo;), (a) senior in preference and priority to the
common stock of the Company (the &ldquo;Common Stock&rdquo;) and any other class or series of equity security established
and designated by the Board of Directors the terms of which do not expressly provide that it ranks senior in preference or priority
to or on parity with the Series B Preferred Stock with respect to dividend rights and rights upon a Liquidation Event (collectively,
&ldquo;Junior Securities&rdquo;), (b) on parity, without preference or priority, with the Series A Preferred Stock and with each
other class or series of equity security established and designated by the Board of Directors the terms of which expressly provide
that it ranks on parity, without preference or priority to, the Series B Preferred Stock with respect to dividend rights and rights
upon a Liquidation Event (collectively, &ldquo;Parity Securities&rdquo;), and (c) junior in preference and priority to each other
class or series of equity security established and designated by the Board of Directors the terms of which expressly provide that
it ranks senior in preference or priority to the Series B Preferred Stock with respect to dividend rights and rights upon a Liquidation
Event (collectively, &ldquo;Senior Securities&rdquo;).</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">Dividends.
The holders of the Series B Preferred Stock shall be entitled to receive cash dividends, when, as and if declared by the Board,
out of any assets legally available therefor, prior and in preference to any declaration or payment of any dividend on any other
class of Preferred Stock, except for the Series A Preferred Stock which shall be paid at the same time as the Series B Preferred
Stock is paid, and Common Stock of the Corporation at an annual rate of nine percent (9%) of the Original Issue Price per share
(equal to $.09 per share per annum) payable out of legally available funds. Dividends shall accrue on each share of Series B Preferred
Stock from the date of issuance thereof, whether paid or not, and shall be cumulative and compounded annually. Such dividends
shall be payable on the first day of each January, April, July and October commencing with respect to each share of Series B Preferred
Stock, on the first of such dates to occur after the issuance of such share (each such date a &ldquo;Dividend Payment Date&rdquo;)
to the holders of record at the close of business on the fifteenth day of each December, March, June and September, respectively,
subject to declaration of such dividends by the Board. All dividends paid with respect to shares of Series B Preferred Stock shall
be paid pro rata to the holders entitled thereto. Dividends, if paid, must be paid, on all outstanding shares of Series B Preferred
Stock contemporaneously. If any dividend shall not be paid on a Dividend Payment Date, for any reason, the right of the holders
to receive such dividend shall not lapse or terminate but each such dividend shall accrue and be paid to such holders, subject
to the conversion provisions below. No dividend shall be paid to the holders of any shares of Common Stock until all dividends,
including accrued dividends, then owing to the holders of Series B Preferred Stock, shall have been paid in full.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">Liquidation
Preference. In the event of any Liquidation Event, the holders of shares of Series B Preferred Stock then outstanding shall be
entitled to be paid out of the assets of the Company available for distribution to its stockholders before any payment shall be
made to the holders of any Junior Securities by reason of their ownership thereof, an amount per share equal to one hundred fifty
percent (150%) of the Series B Original Issue Price (the &ldquo;Liquidation Preference&rdquo;), plus the amount of accrued and
unpaid dividends thereon from the Original Issue Date through the date of liquidation. If upon any such Liquidation Event the
assets of the Company available for distribution to its stockholders shall be insufficient to pay the holders of shares of Series
B Preferred Stock the full amount to which they shall be entitled under this Section , the holders of shares of Series B Preferred
Stock and Parity Securities shall share ratably in any distribution of the assets available for distribution in proportion to
the respective amounts which would otherwise be payable in respect of the shares held by them upon such distribution if all amounts
payable on or with respect to such shares were paid in full.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">Conversion.
The holders of Series B Preferred Stock shall have conversion rights as follows (the &ldquo;Conversion Rights&rdquo;):</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">Optional
Conversion. Each share of Series B Preferred Stock shall be convertible, at the option of the holder thereof, at any time and
from time to time, into such number of fully paid and non-assessable shares of Common Stock as is determined by dividing the Series
B Original Issue Price by the Conversion Price (as defined below) in effect at the time of conversion. The Conversion Price at
which shares of Common Stock shall be deliverable upon conversion of Series B Preferred Stock without the payment of additional
consideration by the holder thereof (the &ldquo;Conversion Price&rdquo;) shall initially be $1.28 per share. Such initial Conversion
Price, and the rate at which shares of Series B Preferred Stock may be converted into shares of Common Stock, shall be subject
to adjustment as provided below. All accrued and unpaid dividends may be converted by each holder of Series B Preferred Stock
into Common Stock by first determining the number of shares of Series B Preferred Stock that could be purchased based on the Series
B Original Issue Price then in effect and then determining the number of shares of Common Stock such additional shares of Series
B Preferred Stock are convertible into. By way of illustration only, if the accrued and unpaid dividends are equal to $100,000,
then based on the Series B Original Issue Price of $1.50 and a Conversion Price of $1.28, the holders of Series B Preferred Stock
would receive an additional 78,125 shares of Common Stock.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">Automatic
Conversion. Upon the consummation of an underwritten public offering of the Common Stock of the Company (&ldquo;IPO&rdquo;), each
share of Series B Preferred Stock shall automatically be converted into such number of fully paid and non-assessable shares of
Common Stock at a Conversion Price equal to the lesser of (i) the Conversion Price in effect immediately prior to the consummation
of the IPO or (ii) fifty percent (50%) of the public offering price of the Common Stock in the IPO. All accrued and unpaid dividends
may be converted by each holder of Series B Preferred Stock into Common Stock by first determining the number of shares of Series
B Preferred Stock that could be purchased based on the Series B Original Issue Price then in effect and then determining the number
of shares of Common Stock such additional shares of Series B Preferred Stock are convertible into. By way of illustration only,
if the accrued and unpaid dividends are equal to $100,000, then based on the Series B Original Issue Price of $1.50 and a Conversion
Price of $1.28, the holders of Series B Preferred Stock would receive an additional 78,125 shares of Common Stock.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B><I>&nbsp;&nbsp;</I></B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><B><I><U>Undesignated Preferred Stock</U></I></B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"></P>



<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">The Company has the ability to authorize
Series A and Series B Convertible Preferred Stock.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B><I>&nbsp;</I></B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><B><I><U>Treasury Stock</U></I></B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">Since its inception, we have repurchased shares
from our shareholders. To date, we have repurchased 1,226,630 shares, of which 817,753 have been retired.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">In connection with a 2018 consulting agreement,
we are committed to issue 408,877 shares held in treasury upon the occurrence of certain events or milestones. We issued, out
of treasury, 136,292 shares in July 2018 and 136,292 shares in July 2019.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><B><I><U>Warrant Issuance-Common Stock</U></I></B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">As part of the sale and issuance of 3,913,414
shares of our Series B Convertible Preferred Stock of SBG, we issued warrants to purchase 2,666,837 shares of our common stock
at a price of $1.10 per share. The warrants have a 5-year term. At December 31, 2019, there are 2,593,486 warrants outstanding
with a weighted average remaining life of 0.9 years.</P>



<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B>Splash
Beverage Group, Inc.</B></FONT></P>

<P STYLE="border-bottom: Black 1pt solid; font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B>Notes
to the Consolidated Financial Statements</B></FONT></P>


<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B>&nbsp;</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B><U>Note
8 &ndash; Share-Based Payments</U></B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B>&nbsp;</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><B><I><U>Warrant Issuance-Loan Agreements</U></I></B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">In 2014, the Company issued seven (7)
warrants for the purchase of 1,362,922 shares of the Company&rsquo;s common stock. The warrants were issued with various loan
agreements as described above in Note 4. Two warrants for a total of 136,292 shares of common stock were issued with exercise
prices of $0.73 per share and five warrants for a total of 1,226,630 shares of common stock were issued with an exercise price
of $0.92 per share. The Company estimated the fair value of the warrants totaling $161,626 based on its estimate of the fair value
of the Company&rsquo;s common stock at the issuance date, an average risk-free interest rate of 1.69%, the estimated life of half
of the term of the warrant, a zero dividend yield and, a volatility rate of 50%, which was recorded as a discount to the notes
and amortized over the notes&rsquo; lives under the effective interest rate method. The fair value of the warrants were expensed
over the life of the loans which was 12 months. These warrants have expired as of December 31, 2018.</P>
<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B>&nbsp;</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B><I><U>Warrant
Issuance-GMA Consulting Services</U></I></B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">During 2018, <FONT STYLE="font: 10pt Times New Roman, Times, Serif">we
issued warrants to purchase 1,362,922 shares of our common stock at $0.007 per share as part of our consulting agreement with
GMA (see Note 4), At December 31, 2019, the weighted average life of the outstanding warrants is 3.75 years.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">The
warrants entitle the holder to purchase one share per warrant of the Company&rsquo;s common stock at a price of $0.007 per share
during the five-year period commencing on October 2, 2018, or, if greater, the number of common shares with a market value equivalent
to two percent of the enterprise value of the Company at an exercise price of $0.006 per share.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B><I><U>Stock
Plan</U></I></B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">We
have adopted the 2012 Stock Incentive Plan (the &ldquo;Plan&rdquo;), which provides for the grant of common stock and stock options
to employees. We have reserved 4,088,765 shares for issuance under the Plan. The option exercise price generally may not be less
than the underlying stock&rsquo;s fair market value at the date of the grant and generally have a term of ten years. On December
31, 2018, the sole option holder at the time, our CEO, exercised his options to purchase 2,657,698 shares of common stock at a
purchase price of $0.12 per share, totaling $312,000, which total purchase price was paid by the cancelation of the equivalent
amount of debt owed by us to the CEO. On December 7, 2019, our Board of Directors granted 1,124,410 options to certain employees
and consultants. None of these options were exercised at December 31, 2019. There are 1,124,410 options issued and outstanding
under the Plan at December 31, 2019. As of December 31, 2019, the total number of options available for grant is 306,657.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B>Splash
Beverage Group, Inc.</B></FONT></P>

<P STYLE="border-bottom: Black 1pt solid; font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B>Notes
to the Consolidated Financial Statements</B></FONT></P>


<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B><U>Note
8 &ndash; Share-Based Payments, continued</U></B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B>&nbsp;</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B><I><U>Stock
Plan, continued</U></I></B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">We
measure employee stock-based awards at the grant-date fair value and recognizes employee compensation expense on a straight-line
basis over the vesting period of the award. Determining the appropriate fair value of stock-based awards requires the input of
subjective assumptions, including the fair value of our common stock, and for stock options, the expected life of the option,
and expected stock price volatility and exercise price. We used the Black-Scholes option pricing model to value its stock option
awards. The assumptions used in calculating the fair value of stock-based awards represent management&rsquo;s best estimates and
involve inherent uncertainties and the application of management&rsquo;s judgment. As a result, if factors change and management
uses different assumptions, stock-based compensation expense could be materially different for future awards. The expected life
of stock options was estimated using the &ldquo;simplified method,&rdquo; which calculates the expected term as the midpoint between
the weighted average time to vesting and the contractual maturity, we have limited historical information to develop reasonable
expectations about future exercise patterns and employment duration for its stock options grants. The simplified method is based
on the average of the vesting tranches and the contractual life of each grant. For stock price volatility, we use comparable public
companies as a basis for its expected volatility to calculate the fair value of options granted. The risk-free interest rate is
based on U.S. Treasury notes with a term approximating the expected life of the option. The estimation of the number of stock
awards that will ultimately vest requires judgment, and to the extent actual results or updated estimates differ from the Company&rsquo;s
current estimates, such amounts are recognized as an adjustment in the period in which estimates are revised.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">We
recognized stock-based compensation expense of $265,589 and $0 for the years ended December 31, 2019 and 2018, respectively. There
was no unrecognized compensation cost related to stock option awards at December 31, 2019.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B>&nbsp;</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">A
summary of information related to stock options for the years ended December 31, 2019 and 2018 is as follows:</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: 10pt Times New Roman, Times, Serif; border-collapse: collapse; width: 100%">
<TR STYLE="vertical-align: bottom">
    <TD STYLE="white-space: nowrap">&nbsp;</TD><TD STYLE="font-weight: bold; padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="6" STYLE="border-bottom: Black 1pt solid; white-space: nowrap; font-weight: bold; text-align: center">December
    31, 2019</TD><TD STYLE="padding-bottom: 1pt; font-weight: bold">&nbsp;</TD><TD STYLE="font-weight: bold; padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="6" STYLE="border-bottom: Black 1pt solid; white-space: nowrap; font-weight: bold; text-align: center">December
    31, 2018</TD><TD STYLE="padding-bottom: 1pt; font-weight: bold">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD STYLE="white-space: nowrap">&nbsp;</TD><TD>&nbsp;</TD>
    <TD COLSPAN="2" STYLE="white-space: nowrap">&nbsp;</TD><TD>&nbsp;</TD><TD STYLE="font-weight: bold">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="white-space: nowrap; font-weight: bold; text-align: center">Weighted Average</TD><TD STYLE="font-weight: bold">&nbsp;</TD><TD>&nbsp;</TD>
    <TD COLSPAN="2" STYLE="white-space: nowrap">&nbsp;</TD><TD>&nbsp;</TD><TD STYLE="font-weight: bold">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="white-space: nowrap; font-weight: bold; text-align: center">Weighted Average</TD><TD STYLE="font-weight: bold">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD STYLE="white-space: nowrap">&nbsp;</TD><TD STYLE="font-weight: bold; padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="border-bottom: Black 1pt solid; white-space: nowrap; font-weight: bold; text-align: center">Options</TD><TD STYLE="padding-bottom: 1pt; font-weight: bold">&nbsp;</TD><TD STYLE="font-weight: bold; padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="border-bottom: Black 1pt solid; white-space: nowrap; font-weight: bold; text-align: center">Exercise
    Price</TD><TD STYLE="padding-bottom: 1pt; font-weight: bold">&nbsp;</TD><TD STYLE="font-weight: bold; padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="border-bottom: Black 1pt solid; white-space: nowrap; font-weight: bold; text-align: center">Options</TD><TD STYLE="padding-bottom: 1pt; font-weight: bold">&nbsp;</TD><TD STYLE="font-weight: bold; padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="border-bottom: Black 1pt solid; white-space: nowrap; font-weight: bold; text-align: center">Exercise
    Price</TD><TD STYLE="padding-bottom: 1pt; font-weight: bold">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD STYLE="white-space: nowrap">&nbsp;</TD><TD>&nbsp;</TD>
    <TD COLSPAN="2" STYLE="white-space: nowrap">&nbsp;</TD><TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD COLSPAN="2" STYLE="white-space: nowrap">&nbsp;</TD><TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD COLSPAN="2" STYLE="white-space: nowrap">&nbsp;</TD><TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD COLSPAN="2" STYLE="white-space: nowrap">&nbsp;</TD><TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="width: 52%; text-align: left; text-indent: -0.1in; padding-left: 0.1in">Outstanding - beginning of year</TD><TD STYLE="width: 1%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 9%; text-align: right">-</TD><TD STYLE="white-space: nowrap; width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 1%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">$</TD><TD STYLE="width: 9%; text-align: right">-</TD><TD STYLE="white-space: nowrap; width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 1%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 9%; text-align: right">2,657,698</TD><TD STYLE="white-space: nowrap; width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 1%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">$</TD><TD STYLE="width: 9%; text-align: right">0.12</TD><TD STYLE="white-space: nowrap; width: 1%; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-indent: -0.1in; padding-left: 16.2pt">Granted</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">1,124,410</TD><TD STYLE="white-space: nowrap; text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">$</TD><TD STYLE="text-align: right">0.73</TD><TD STYLE="white-space: nowrap; text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">.</FONT></TD><TD STYLE="white-space: nowrap; text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="white-space: nowrap; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="text-indent: -0.1in; padding-left: 16.2pt">Exercised</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">-</TD><TD STYLE="white-space: nowrap; text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">$</TD><TD STYLE="text-align: right">-</TD><TD STYLE="white-space: nowrap; text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">(2,657,698</TD><TD STYLE="white-space: nowrap; text-align: left">)</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">$</TD><TD STYLE="text-align: right">(0.12</TD><TD STYLE="white-space: nowrap; text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="padding-bottom: 1pt; text-indent: -0.1in; padding-left: 16.2pt">Cancelled/forfeited</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">-</TD><TD STYLE="white-space: nowrap; padding-bottom: 1pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="padding-bottom: 1pt; text-align: left">$</TD><TD STYLE="padding-bottom: 1pt; text-align: right">-</TD><TD STYLE="white-space: nowrap; padding-bottom: 1pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">-</TD><TD STYLE="white-space: nowrap; padding-bottom: 1pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 1pt; text-align: right">&nbsp;</TD><TD STYLE="white-space: nowrap; padding-bottom: 1pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="text-align: left; padding-bottom: 2.5pt; text-indent: -0.1in; padding-left: 0.1in">Outstanding - end of year</TD><TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 2.5pt double; text-align: right">1,124,410</TD><TD STYLE="white-space: nowrap; padding-bottom: 2.5pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="padding-bottom: 2.5pt; text-align: left">$</TD><TD STYLE="padding-bottom: 2.5pt; text-align: right">0.73</TD><TD STYLE="white-space: nowrap; padding-bottom: 2.5pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 2.5pt double; text-align: right">-</TD><TD STYLE="white-space: nowrap; padding-bottom: 2.5pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="padding-bottom: 2.5pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 2.5pt; text-align: right">&nbsp;</TD><TD STYLE="white-space: nowrap; padding-bottom: 2.5pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="white-space: nowrap; text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="white-space: nowrap; text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="white-space: nowrap; text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="white-space: nowrap; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="text-align: left; padding-bottom: 2.5pt; text-indent: -0.1in; padding-left: 0.1in">Exercisable at end of year</TD><TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 2.5pt double; text-align: right">1,124,410</TD><TD STYLE="white-space: nowrap; padding-bottom: 2.5pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="padding-bottom: 2.5pt; text-align: left">$</TD><TD STYLE="padding-bottom: 2.5pt; text-align: right">0.73</TD><TD STYLE="white-space: nowrap; padding-bottom: 2.5pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 2.5pt double; text-align: right">-</TD><TD STYLE="white-space: nowrap; padding-bottom: 2.5pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="padding-bottom: 2.5pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 2.5pt; text-align: right">&nbsp;</TD><TD STYLE="white-space: nowrap; padding-bottom: 2.5pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="white-space: nowrap; text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="white-space: nowrap; text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="white-space: nowrap; text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="white-space: nowrap; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="padding-bottom: 2.5pt; text-align: left; text-indent: -0.1in; padding-left: 0.1in">Weighted average grant date
    fair value of options during year</TD><TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 2.5pt double; text-align: right"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">N/A</FONT></TD><TD STYLE="padding-bottom: 2.5pt; white-space: nowrap; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="padding-bottom: 2.5pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 2.5pt; text-align: right">&nbsp;</TD><TD STYLE="padding-bottom: 2.5pt; white-space: nowrap; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 2.5pt double; text-align: right"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">N/A</FONT></TD><TD STYLE="padding-bottom: 2.5pt; white-space: nowrap; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="padding-bottom: 2.5pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 2.5pt; text-align: right">&nbsp;</TD><TD STYLE="padding-bottom: 2.5pt; white-space: nowrap; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="white-space: nowrap; text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="white-space: nowrap; text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="white-space: nowrap; text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="white-space: nowrap; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="padding-bottom: 2.5pt; text-align: left; text-indent: -0.1in; padding-left: 0.1in">Weighted average duration to
    expiration of outstanding options at year-end</TD><TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 2.5pt double; text-align: right">5.0</TD><TD STYLE="padding-bottom: 2.5pt; white-space: nowrap; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="padding-bottom: 2.5pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 2.5pt; text-align: right">&nbsp;</TD><TD STYLE="padding-bottom: 2.5pt; white-space: nowrap; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 2.5pt double; text-align: right"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">N/A</FONT></TD><TD STYLE="padding-bottom: 2.5pt; white-space: nowrap; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="padding-bottom: 2.5pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 2.5pt; text-align: right">&nbsp;</TD><TD STYLE="padding-bottom: 2.5pt; white-space: nowrap; text-align: left">&nbsp;</TD></TR>
</TABLE>



<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>




<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B>Splash
Beverage Group, Inc.</B></FONT></P>

<P STYLE="border-bottom: Black 1pt solid; font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B>Notes
to the Consolidated Financial Statements</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B>&nbsp;</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B><U>Note
9 &ndash; Related Parties</U></B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B>&nbsp;</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">During
the normal course of business, we incurred expenses related to services provided by our CEO or Company expenses paid by our CEO,
resulting in related party payables, net of $429,432 and $302,934 as of December 31, 2019 and 2018, respectively. The related
party payable to the CEO bears no interest payable and is due on demand.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">During 2018, $312,000 of the related party
was paid in kind as the CEO exercised 2,657,698 options to acquire common stock at $0.12 per share against the payable.</P>



<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">There
are related party notes payable of $1,505,100 and $1,375,100 outstanding as of December 31, 2019 and 2018, respectively, as discussed
in Note 4.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B><U>Note
10 &ndash; Investment in Salt Tequila USA, LLC</U></B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B>&nbsp;</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">On
December 9, 2013, we entered into a marketing and distribution agreement with SALT Tequila USA, LLC (&ldquo;SALT&rdquo;) in Mexico
for the manufacturing of our product line. The agreement was for a one-year term with an additional two-year renewal. On December
28, 2015, the agreement was extended through 2020. In the December 9, 2013 agreement, we received a 5% ownership interest in SALT,
12 months after the date of the agreement we received an additional 5% ownership interest in SALT, and 24 months after the date
of the agreement we received an additional 5% interest, resulting in a total interest of 15% in SALT. We have not recorded the
cost of the investment or our share of its results of operations as the amounts are considered immaterial.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">SALT also has sold product to an unrelated
international alcohol distributor, American Spirits Exchange, for preliminary market testing in 9 of 16 states that they distribute
to, that are government-controlled alcohol resellers. In 2018 and 2019 we had no sales of SALT Tequila. On December 31, 2018,
we created a Mexican subsidiary, Splash MEX SA DE CV (&ldquo;Splash Mex&rdquo;) for the exporting of SALT Tequila from Mexico
to the USA, South and Central Americas. Splash Mex will also act as the manufacturing and distribution agent of TapouT in Central
and South Americas. Applications for the appropriate licenses required for import and wholesale of alcohol in the USA have been
completed for at the Federal and State levels. These licenses will permit direct alcohol sales to distributors and wholesalers
thereby limiting the use of agents for importing SALT Tequila to the USA for distribution.</P>



<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B>&nbsp;</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B><U>Note
11 &ndash; Operating Lease Obligations</U></B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B>&nbsp;</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">Effective
July 2018, we entered into a lease agreement for the right to use and occupy office space. The lease term commenced July 1, 2018
and is scheduled to expire after 36 months, on June 30, 2021. </FONT>Total rent expense for the ten months, beginning in March,
in 2018 was $32,855.</P>



<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">Prior to the current lease, we entered into
a lease agreement in 2014 for the right to use and occupy office space. The lease term commenced November 1, 2014 and was scheduled
to expire after 62 months, on December 31, 2019. The lease was terminated in February 2018. Total rent expense for the two months
in 2018 was $19,641.</P>



<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">Effective
November 2019, we entered into a new lease agreement for our NY affiliate. The lease is for six months and will expire on April
30, 2020. This lease was not subjected to the new lease standard, Topic 842.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B>Splash
Beverage Group, Inc.</B></FONT></P>

<P STYLE="border-bottom: Black 1pt solid; font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B>Notes
to the Consolidated Financial Statements</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B><U>Note
11 &ndash; Operating Lease Obligations, continued</U></B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">Effective
November 2019, we entered into a new lease with Interport Logistics, LLC. The lease term commenced on November 11, 2019 and is
scheduled to expire on November 11, 2020. This lease was subjected to the new lease standard, Topic 842.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">Effective
May 2019, we entered into a new lease in Mexico. The lease commenced May 1, 2019 and is scheduled to expire after 24 months, on
April 1, 2021. This lease was subjected to the new lease standard, Topic 842.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">The
following table presents a reconciliation of the undiscounted future minimum lease payments, under the leases for our office and
warehouses to the amounts reported as financial lease liabilities on the consolidated balance sheet at December 31, 2019:</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: 10pt Times New Roman, Times, Serif; border-collapse: collapse; width: 100%">
<TR STYLE="vertical-align: bottom">
    <TD STYLE="border-bottom: Black 1pt solid; white-space: nowrap; font-weight: bold">Undiscounted Future Minimum Lease Payments</TD><TD STYLE="font-weight: bold; padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="border-bottom: Black 1pt solid; white-space: nowrap; font-weight: bold; text-align: center">Operating
    Lease</TD><TD STYLE="padding-bottom: 1pt; font-weight: bold">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD STYLE="white-space: nowrap">&nbsp;</TD><TD>&nbsp;</TD>
    <TD COLSPAN="2" STYLE="white-space: nowrap">&nbsp;</TD><TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="width: 88%; text-align: left">2020</TD><TD STYLE="width: 1%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">$</TD><TD STYLE="width: 9%; text-align: right">87,734</TD><TD STYLE="white-space: nowrap; width: 1%; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left">2021</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">59,291</TD><TD STYLE="white-space: nowrap; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="padding-bottom: 1pt">Thereafter</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">25,911</TD><TD STYLE="white-space: nowrap; padding-bottom: 1pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; padding-left: 10pt">Total</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">172,936</TD><TD STYLE="white-space: nowrap; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="text-align: left; padding-bottom: 1pt">Amount representing imputed interest</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">(9,196</TD><TD STYLE="white-space: nowrap; padding-bottom: 1pt; text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left">Total operating lease liability</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">163,740</TD><TD STYLE="white-space: nowrap; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="text-align: left; padding-bottom: 1pt">Current portion of operating lease liability</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">(81,502</TD><TD STYLE="white-space: nowrap; padding-bottom: 1pt; text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; padding-bottom: 2.5pt; padding-left: 9pt">Operating lease liability, non-current</TD><TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; text-align: left">$</TD><TD STYLE="border-bottom: Black 2.5pt double; text-align: right">82,238</TD><TD STYLE="white-space: nowrap; padding-bottom: 2.5pt; text-align: left">&nbsp;</TD></TR>
</TABLE>



<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;&nbsp;&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">The
table below presents information for lease costs related to our operating leases at December 31, 2019:</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: 10pt Times New Roman, Times, Serif; border-collapse: collapse; width: 100%">
<TR STYLE="vertical-align: bottom">
    <TD STYLE="white-space: nowrap">Operating lease cost:</TD><TD>&nbsp;</TD>
    <TD COLSPAN="2" STYLE="white-space: nowrap">&nbsp;</TD><TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="width: 88%; text-align: left; padding-left: 9pt">Amortization of leased assets</TD><TD STYLE="width: 1%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">$</TD><TD STYLE="width: 9%; text-align: right">52,692</TD><TD STYLE="white-space: nowrap; width: 1%; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; padding-bottom: 1pt; padding-left: 9pt">Interest of lease liabilities</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">5,716</TD><TD STYLE="white-space: nowrap; padding-bottom: 1pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="text-align: left; padding-bottom: 2.5pt; padding-left: 0.25in">Total operating lease cost</TD><TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; text-align: left">$</TD><TD STYLE="border-bottom: Black 2.5pt double; text-align: right">58,408</TD><TD STYLE="white-space: nowrap; padding-bottom: 2.5pt; text-align: left">&nbsp;</TD></TR>
</TABLE>



<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">The
table below presents lease-related terms and discount rates at December 31, 2019:</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>


<TABLE CELLSPACING="0" CELLPADDING="0" STYLE="font: 12pt Times New Roman, Times, Serif; width: 100%; border-collapse: collapse">
<TR STYLE="vertical-align: bottom; background-color: #CCEEFF">
    <TD><FONT STYLE="font-size: 10pt">Remaining term on leases</FONT></TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: center">&nbsp;</TD>
    <TD STYLE="text-align: center"><FONT STYLE="font-size: 10pt">16 to 34 months</FONT></TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: white">
    <TD STYLE="width: 89%"><FONT STYLE="font-size: 10pt">Incremented borrowing rate</FONT></TD>
    <TD STYLE="width: 1%">&nbsp;</TD>
    <TD STYLE="width: 1%">&nbsp;</TD>
    <TD STYLE="width: 8%; text-align: center"><FONT STYLE="font-size: 10pt">5.0%</FONT></TD>
    <TD STYLE="width: 1%">&nbsp;</TD></TR>
</TABLE>
<P STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt; text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"></P>

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    <DIV STYLE="page-break-before: always; margin-top: 6pt; margin-bottom: 6pt"><P STYLE="margin: 0pt">&nbsp;</P></DIV>
    <!-- Field: /Page -->

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B>Splash
Beverage Group, Inc.</B></FONT></P>

<P STYLE="border-bottom: Black 1pt solid; font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B>Notes
to the Consolidated Financial Statements</B></FONT></P>


<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B><U>Note
12 - Contingencies</U></B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B>&nbsp;</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">We
are a party to asserted claims and are subject to regulatory actions in the ordinary course of business. The results of such proceedings
cannot be predicted with certainty, but the Company does not anticipate that the outcome, if any, arising out of any such matter
will have a material adverse effect on its business, financial condition or results of operations.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B><I><U>Litigation</U></I></B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">On
April 24, 2017, a note holder filed a complaint against the Company for a promissory note in default. The note holder is requesting
summary judgment in the amount of $246,632.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B><U>Note
13 &ndash; Subsequent Events</U></B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><B><I><U>TapouT Licensing Agreement</U></I></B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">Effective January 1, 2020, we have amended
our license agreement with TapouT as previously disclosed in Note 5. The agreement has been extended through December 31, 2022.
Under the terms of the amendment, we are required to make guaranteed minimum royalty monthly payments of $45,000 through December
31, 2022. We also are required to meet a minimum net sales threshold of $9,000,000 for 2020. There can be no assurance that the
net sales threshold will be achieved, or that further amendments to the agreement will be executed for it to remain effective
in 2021 and later periods.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><B><I><U>SALT Tequila Purchase Agreement</U></I></B>&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">On March 26, 2020, we entered into a new
amended stock sale and purchase agreement. The agreement is for $1,000,000 to be paid in 4 tranches of $250,000 and entitles us
to additional equity interest in Salt Tequila USA, LLC as follows:</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<TABLE CELLSPACING="0" CELLPADDING="0" STYLE="font: 10pt Times New Roman, Times, Serif; width: 100%">
<TR>
    <TD STYLE="width: 24px">&nbsp;</TD>
    <TD STYLE="width: 24px; font-size: 10pt"><FONT STYLE="font-size: 10pt">&#9679;</FONT></TD>
    <TD STYLE="font-size: 10pt; text-align: justify"><FONT STYLE="font-size: 10pt">Tranche 1 &ndash; 7.5%</FONT></TD></TR>
</TABLE>
<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"></P>

<TABLE CELLSPACING="0" CELLPADDING="0" STYLE="font: 10pt Times New Roman, Times, Serif; width: 100%">
<TR>
    <TD STYLE="width: 24px">&nbsp;</TD>
    <TD STYLE="width: 24px; font-size: 10pt"><FONT STYLE="font-size: 10pt">&#9679;</FONT></TD>
    <TD STYLE="font-size: 10pt; text-align: justify"><FONT STYLE="font-size: 10pt">Tranche 2 &ndash; 5.0%</FONT></TD></TR>
</TABLE>
<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"></P>

<TABLE CELLSPACING="0" CELLPADDING="0" STYLE="font: 10pt Times New Roman, Times, Serif; width: 100%">
<TR>
    <TD STYLE="width: 24px">&nbsp;</TD>
    <TD STYLE="width: 24px; font-size: 10pt"><FONT STYLE="font-size: 10pt">&#9679;</FONT></TD>
    <TD STYLE="font-size: 10pt; text-align: justify"><FONT STYLE="font-size: 10pt">Tranche 3 &ndash; 5.0%</FONT></TD></TR>
</TABLE>
<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"></P>

<TABLE CELLSPACING="0" CELLPADDING="0" STYLE="font: 10pt Times New Roman, Times, Serif; width: 100%">
<TR>
    <TD STYLE="width: 24px">&nbsp;</TD>
    <TD STYLE="width: 24px; font-size: 10pt"><FONT STYLE="font-size: 10pt">&#9679;</FONT></TD>
    <TD STYLE="font-size: 10pt; text-align: justify"><FONT STYLE="font-size: 10pt">Tranche 4 &ndash; 5.0%</FONT></TD></TR>
</TABLE>
<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">Once all tranches are paid-out we will
have a total equity stake of 37.5% of Salt Tequila USA, LLC.</P>



<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><B><I><U>Merger with Canfield Medical Supply,
Inc.</U></I></B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">As previously described in Note 1, Splash
entered into a Merger Agreement with CMS. Upon completion of the merger, the Splash shareholders collectively own, as a group,
on a fully diluted basis approximately 85% of the combined company.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">The Merger Agreement was consummated on
March 31, 2020. As part of the merger, pursuant to a Promissory Note Conversion Agreement, all outstanding debt of Splash, except
for $450,000 in principal, was converted in common shares of the combined entity. Under the Promissory Note Conversion Agreement,
if the Company shall fail to raise $9,000,000 of additional capital no later than six months from the date of the Merger, then
the holder may seek to rescind the Promissory Note Conversion Agreement, return the Note Conversion Shares and receive a replacement
promissory note from the Company.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">In addition, in connection with the Merger,
pursuant to Preferred Stock Conversion Agreements, all Series A Convertible Preferred Stock and Series B Convertible Preferred
Stock, and accreted dividends of Splash were converted into common shares of the combined entity, and have been reflected as outstanding
for all periods presented. Under the Preferred Stock Conversion Agreement, if the Company shall fail to raise $9,000,000 of additional
capital no later than six months from the date of the Merger, then the holder may seek to rescind the Preferred Stock Conversion
Agreement, return the Preferred Stock Conversion Shares and receive replacement shares of preferred stock from the Company.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><B><I><U>Alcohol License</U></I></B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">On February 4, 2020 we received a Florida
Alcohol License. This license gives us the ability to import and sell liquor within the United States.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><B><I><U>Warrant Expiration</U></I></B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">Subsequent to December 31, 2019, warrants
to purchase 754,741 shares of our common stock have expired.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><B><I><U>Mezzanine Equity</U></I></B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">As part of the merger, dated March 31,
2020, we converted the majority of our debt into equity. As stated in the debt conversion agreements, each debt holder can convert
their shares back to debt if we are not able to adequately raise $9,000,000 additional capital within six months of the date of
the merger. As a result, these shares have been classified as mezzanine equity in the consolidated balance sheet on March 31, 2020.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><B>&nbsp;</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><B><I><U>Q1 2020 Notes Received</U></I></B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">During the first quarter of 2020, we received
$1.5 million from one of our shareholders to be used to finance the operations of the Company. As part of the merger, the entire
$1.5 million was converted into mezzanine equity.</P>



<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"></P>





<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B>&nbsp;&nbsp;</B></FONT></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><FONT STYLE="font-size: 14pt"><B>Splash Beverage
Group, Inc.</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><B>[f/k/a Canfield Medical Supply, Inc.]</B></P>



<P STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0; text-align: center"></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0; text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B>&nbsp;</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0; text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B>Condensed
Consolidated Financial Statements</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0; text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0; text-align: center"><B>June</B>  <FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B>30,
2020</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0; text-align: center">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0; text-align: center">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0; text-align: center">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0; text-align: center">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0; text-align: center">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0; text-align: center">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0; text-align: center">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0; text-align: center"></P>

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    <DIV STYLE="page-break-before: always; margin-top: 6pt; margin-bottom: 6pt"><P STYLE="margin: 0pt">&nbsp;</P></DIV>
    <!-- Field: /Page -->

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0; text-align: center">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><A NAME="balance"></A><B>Splash
Beverage Group, Inc.</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><B>[f/k/a Canfield Medical Supply, Inc.]</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B>Condensed
Consolidated Balance Sheets</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B>June
30, 2020 and December 31, 2019</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B>(Unaudited)</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B>&nbsp;</B></FONT></P>





<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B></B></FONT></P>



<TABLE CELLSPACING="0" CELLPADDING="0" STYLE="font: 12pt Times New Roman, Times, Serif; width: 100%; border-collapse: collapse">
<TR STYLE="vertical-align: bottom">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD COLSPAN="3" STYLE="text-align: center">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD COLSPAN="3" STYLE="text-align: center">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="3" STYLE="border-bottom: black 1pt solid; text-align: center"><FONT STYLE="font-size: 10pt"><B>June 30, 2020</B></FONT></TD>
    <TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="3" STYLE="border-bottom: black 1pt solid; white-space: nowrap; text-align: center"><FONT STYLE="font-size: 10pt"><B>December 31, 2019</B></FONT></TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD STYLE="text-align: center"><FONT STYLE="font-size: 10pt"><U>Assets</U></FONT></TD>
    <TD>&nbsp;</TD>
    <TD COLSPAN="3" STYLE="text-align: center">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD COLSPAN="3" STYLE="text-align: center">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: #CCEEFF">
    <TD><FONT STYLE="font-size: 10pt">Current assets:</FONT></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">&nbsp;</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: white">
    <TD STYLE="width: 72%; padding-left: 10pt"><FONT STYLE="font-size: 10pt">Cash and cash equivalents</FONT></TD>
    <TD STYLE="width: 2%">&nbsp;</TD>
    <TD STYLE="width: 1%"><FONT STYLE="font-size: 10pt">$</FONT></TD>
    <TD STYLE="width: 10%; text-align: right"><FONT STYLE="font-size: 10pt">118,751</FONT></TD>
    <TD STYLE="width: 1%">&nbsp;</TD>
    <TD STYLE="width: 2%">&nbsp;</TD>
    <TD STYLE="width: 1%"><FONT STYLE="font-size: 10pt">$</FONT></TD>
    <TD STYLE="width: 10%; text-align: right"><FONT STYLE="font-size: 10pt">42,639</FONT></TD>
    <TD STYLE="width: 1%">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: #CCEEFF">
    <TD STYLE="padding-left: 10pt"><FONT STYLE="font-size: 10pt">Accounts Receivable, net</FONT></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">359,657</FONT></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">11,430</FONT></TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: white">
    <TD STYLE="padding-left: 10pt"><FONT STYLE="font-size: 10pt">Prepaid Expenses</FONT></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">19,114</FONT></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">5,449</FONT></TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: #CCEEFF">
    <TD STYLE="padding-left: 10pt"><FONT STYLE="font-size: 10pt">Inventory</FONT></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">479,230</FONT></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">304,012</FONT></TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: white">
    <TD STYLE="padding-bottom: 1pt; padding-left: 10pt"><FONT STYLE="font-size: 10pt">Other receivables</FONT></TD>
    <TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid; text-align: right"><FONT STYLE="font-size: 10pt">9,544</FONT></TD>
    <TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid; text-align: right"><FONT STYLE="font-size: 10pt">7,132</FONT></TD>
    <TD STYLE="padding-bottom: 1pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: #CCEEFF">
    <TD STYLE="padding-bottom: 1pt; padding-left: 20pt"><FONT STYLE="font-size: 10pt">Total current assets</FONT></TD>
    <TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid; text-align: right"><FONT STYLE="font-size: 10pt">986,296</FONT></TD>
    <TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid; text-align: right"><FONT STYLE="font-size: 10pt">370,662</FONT></TD>
    <TD STYLE="padding-bottom: 1pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: white">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">&nbsp;</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: #CCEEFF">
    <TD><FONT STYLE="font-size: 10pt">Non-current assets:</FONT></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">&nbsp;</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: white">
    <TD STYLE="padding-left: 10pt"><FONT STYLE="font-size: 10pt">Deposit</FONT></TD>
    <TD>&nbsp;</TD>
    <TD><FONT STYLE="font-size: 10pt">$</FONT></TD>
    <TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">56,366</FONT></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD><FONT STYLE="font-size: 10pt">$</FONT></TD>
    <TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">34,915</FONT></TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: #CCEEFF">
    <TD STYLE="padding-left: 10pt"><FONT STYLE="font-size: 10pt">Goodwill</FONT></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">9,448,852</FONT></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">&mdash;&nbsp;&nbsp;</FONT></TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: white">
    <TD STYLE="padding-left: 10pt"><FONT STYLE="font-size: 10pt">Investment in Salt Tequila USA, LLC</FONT></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">250,000</FONT></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">&mdash;&nbsp;&nbsp;</FONT></TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: #CCEEFF">
    <TD STYLE="padding-left: 10pt"><FONT STYLE="font-size: 10pt">Right of use asset, net</FONT></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">130,101</FONT></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">162,008</FONT></TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: white">
    <TD STYLE="padding-bottom: 1pt; padding-left: 10pt"><FONT STYLE="font-size: 10pt">Property and equipment, net</FONT></TD>
    <TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid; text-align: right"><FONT STYLE="font-size: 10pt">64,269</FONT></TD>
    <TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid; text-align: right"><FONT STYLE="font-size: 10pt">37,729</FONT></TD>
    <TD STYLE="padding-bottom: 1pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: #CCEEFF">
    <TD STYLE="padding-bottom: 1pt; padding-left: 20pt"><FONT STYLE="font-size: 10pt">Total non-current assets</FONT></TD>
    <TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid; text-align: right"><FONT STYLE="font-size: 10pt">9,948,049</FONT></TD>
    <TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid; text-align: right"><FONT STYLE="font-size: 10pt">234,652</FONT></TD>
    <TD STYLE="padding-bottom: 1pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: white">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">&nbsp;</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: #CCEEFF">
    <TD STYLE="padding-bottom: 2.5pt; padding-left: 20pt"><FONT STYLE="font-size: 10pt">Total assets</FONT></TD>
    <TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: black 2.25pt double"><FONT STYLE="font-size: 10pt">$</FONT></TD>
    <TD STYLE="border-bottom: black 2.25pt double; text-align: right"><FONT STYLE="font-size: 10pt">10,935,884</FONT></TD>
    <TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: black 2.25pt double"><FONT STYLE="font-size: 10pt">$</FONT></TD>
    <TD STYLE="border-bottom: black 2.25pt double; text-align: right"><FONT STYLE="font-size: 10pt">605,314</FONT></TD>
    <TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: white">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">&nbsp;</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: #CCEEFF">
    <TD STYLE="text-align: center"><FONT STYLE="font-size: 10pt"><B><U>Liabilities and Deficiency in Stockholders' Equity</U></B></FONT></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">&nbsp;</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: white">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">&nbsp;</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: #CCEEFF">
    <TD><FONT STYLE="font-size: 10pt">Liabilities:</FONT></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">&nbsp;</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: white">
    <TD><FONT STYLE="font-size: 10pt">&nbsp;&nbsp;Current liabilities</FONT></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">&nbsp;</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: #CCEEFF">
    <TD STYLE="padding-left: 10pt"><FONT STYLE="font-size: 10pt">Accounts payable and accrued expenses</FONT></TD>
    <TD>&nbsp;</TD>
    <TD><FONT STYLE="font-size: 10pt">$</FONT></TD>
    <TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">1,118,582</FONT></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD><FONT STYLE="font-size: 10pt">$</FONT></TD>
    <TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">703,885</FONT></TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: white">
    <TD STYLE="padding-left: 10pt"><FONT STYLE="font-size: 10pt">Right of use liability - current</FONT></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">89,950</FONT></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">81,502</FONT></TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: #CCEEFF">
    <TD STYLE="padding-left: 10pt"><FONT STYLE="font-size: 10pt">Due to related parties</FONT></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">517,875</FONT></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">429,432</FONT></TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: white">
    <TD STYLE="padding-left: 10pt"><FONT STYLE="font-size: 10pt">Bridge loan payable, net</FONT></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">&mdash;&nbsp;&nbsp;</FONT></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">2,200,000</FONT></TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: #CCEEFF">
    <TD STYLE="padding-left: 10pt"><FONT STYLE="font-size: 10pt">Related party notes payable</FONT></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">&mdash;&nbsp;&nbsp;</FONT></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">1,505,100</FONT></TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: white">
    <TD STYLE="padding-left: 10pt"><FONT STYLE="font-size: 10pt">Convertible Loan Payable</FONT></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">100,000</FONT></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">2,202,664</FONT></TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: #CCEEFF">
    <TD STYLE="padding-left: 10pt"><FONT STYLE="font-size: 10pt">Notes payable, current portion</FONT></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">539,611</FONT></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">875,000</FONT></TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: white">
    <TD STYLE="padding-left: 10pt"><FONT STYLE="font-size: 10pt">Royalty payable</FONT></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">90,000</FONT></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">39,000</FONT></TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: #CCEEFF">
    <TD STYLE="padding-left: 10pt"><FONT STYLE="font-size: 10pt">Revenue financing arrangements</FONT></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">12,710</FONT></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">45,467</FONT></TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: white">
    <TD STYLE="padding-left: 10pt"><FONT STYLE="font-size: 10pt">Shareholder advances</FONT></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">88,000</FONT></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">46,250</FONT></TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: #CCEEFF">
    <TD STYLE="padding-left: 10pt"><FONT STYLE="font-size: 10pt">Accrued interest payable</FONT></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">805,602</FONT></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">1,604,498</FONT></TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: white">
    <TD STYLE="padding-bottom: 1pt; padding-left: 10pt"><FONT STYLE="font-size: 10pt">Accrued interest payable - related parties</FONT></TD>
    <TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid; text-align: right"><FONT STYLE="font-size: 10pt">&mdash;&nbsp;&nbsp;</FONT></TD>
    <TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid; text-align: right"><FONT STYLE="font-size: 10pt">546,362</FONT></TD>
    <TD STYLE="padding-bottom: 1pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: #CCEEFF">
    <TD STYLE="padding-bottom: 1pt; padding-left: 20pt"><FONT STYLE="font-size: 10pt">Total current liabilities</FONT></TD>
    <TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid; text-align: right"><FONT STYLE="font-size: 10pt">3,362,330</FONT></TD>
    <TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid; text-align: right"><FONT STYLE="font-size: 10pt">10,279,160</FONT></TD>
    <TD STYLE="padding-bottom: 1pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: white">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">&nbsp;</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: #CCEEFF">
    <TD><FONT STYLE="font-size: 10pt">Long-term Liabilities:</FONT></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">&nbsp;</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: white">
    <TD STYLE="padding-left: 10pt"><FONT STYLE="font-size: 10pt">Related party notes payable - noncurrent</FONT></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">64,200</FONT></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">&mdash;&nbsp;&nbsp;</FONT></TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: #CCEEFF">
    <TD STYLE="padding-bottom: 1pt; padding-left: 10pt"><FONT STYLE="font-size: 10pt">Right of use liability - noncurrent</FONT></TD>
    <TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid; text-align: right"><FONT STYLE="font-size: 10pt">40,151</FONT></TD>
    <TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid; text-align: right"><FONT STYLE="font-size: 10pt">82,238</FONT></TD>
    <TD STYLE="padding-bottom: 1pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: white">
    <TD STYLE="padding-bottom: 1pt; padding-left: 20pt"><FONT STYLE="font-size: 10pt">Total long-term liabilities</FONT></TD>
    <TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid; text-align: right"><FONT STYLE="font-size: 10pt">104,351</FONT></TD>
    <TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid; text-align: right"><FONT STYLE="font-size: 10pt">82,238</FONT></TD>
    <TD STYLE="padding-bottom: 1pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: #CCEEFF">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">&nbsp;</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: white">
    <TD STYLE="padding-bottom: 1pt; padding-left: 20pt"><FONT STYLE="font-size: 10pt">Total liabilities</FONT></TD>
    <TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid; text-align: right"><FONT STYLE="font-size: 10pt">3,466,681</FONT></TD>
    <TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid; text-align: right"><FONT STYLE="font-size: 10pt">10,361,398</FONT></TD>
    <TD STYLE="padding-bottom: 1pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: #CCEEFF">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">&nbsp;</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: white">
    <TD STYLE="padding-bottom: 1pt; padding-left: 10pt"><FONT STYLE="font-size: 10pt">Common stock, (mezzanine shares) 12,605,283 shares, contingently convertible to notes payable at June 30, 2020</FONT></TD>
    <TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid; text-align: right"><FONT STYLE="font-size: 10pt">9,248,720</FONT></TD>
    <TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid; text-align: right"><FONT STYLE="font-size: 10pt">&mdash;&nbsp;&nbsp;</FONT></TD>
    <TD STYLE="padding-bottom: 1pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: #CCEEFF">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">&nbsp;</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: white">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">&nbsp;</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: #CCEEFF">
    <TD><FONT STYLE="font-size: 10pt">Deficiency in stockholders' equity:</FONT></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">&nbsp;</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: white">
    <TD STYLE="padding-left: 10pt"><FONT STYLE="font-size: 10pt">Common Stock, $0.001 par, 100,000,000 shares authorized, 57,002,247 and 44,021,382 shares</FONT></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">&nbsp;</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: #CCEEFF">
    <TD STYLE="padding-left: 20pt"><FONT STYLE="font-size: 10pt">issued 57,002,247 and 43,885,090 outstanding, at June 30, 2020 and December 31, 2019, respectively</FONT></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">57,002</FONT></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">44,021</FONT></TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: white">
    <TD STYLE="padding-left: 10pt"><FONT STYLE="font-size: 10pt">Additional paid in capital</FONT></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">34,898,641</FONT></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">22,095,403</FONT></TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: #CCEEFF">
    <TD STYLE="padding-left: 10pt"><FONT STYLE="font-size: 10pt">Treasury Stock, $0.001 par, 136,292 shares at cost</FONT></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">&mdash;&nbsp;&nbsp;</FONT></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">(50,000</FONT></TD>
    <TD><FONT STYLE="font-size: 10pt">)</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: white">
    <TD STYLE="padding-bottom: 1pt; padding-left: 10pt"><FONT STYLE="font-size: 10pt">Accumulated deficit</FONT></TD>
    <TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid; text-align: right"><FONT STYLE="font-size: 10pt">(36,735,159</FONT></TD>
    <TD STYLE="padding-bottom: 1pt"><FONT STYLE="font-size: 10pt">)</FONT></TD>
    <TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid; text-align: right"><FONT STYLE="font-size: 10pt">(31,845,508</FONT></TD>
    <TD STYLE="padding-bottom: 1pt"><FONT STYLE="font-size: 10pt">)</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: #CCEEFF">
    <TD STYLE="padding-left: 20pt"><FONT STYLE="font-size: 10pt">Total deficiency in stockholders' equity</FONT></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">(1,779,517</FONT></TD>
    <TD><FONT STYLE="font-size: 10pt">)</FONT></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">(9,756,084</FONT></TD>
    <TD><FONT STYLE="font-size: 10pt">)</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: white">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">&nbsp;</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: #CCEEFF">
    <TD STYLE="padding-bottom: 2.5pt; padding-left: 20pt"><FONT STYLE="font-size: 10pt">Total liabilities, mezzanine shares and deficiency in stockholders' equity</FONT></TD>
    <TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: black 2.25pt double"><FONT STYLE="font-size: 10pt">$</FONT></TD>
    <TD STYLE="border-bottom: black 2.25pt double; text-align: right"><FONT STYLE="font-size: 10pt">10,935,884</FONT></TD>
    <TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: black 2.25pt double"><FONT STYLE="font-size: 10pt">$</FONT></TD>
    <TD STYLE="border-bottom: black 2.25pt double; text-align: right"><FONT STYLE="font-size: 10pt">605,314</FONT></TD>
    <TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD></TR>
</TABLE>
<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B>&nbsp;</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B></B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">The
accompanying notes are an integral part of these condensed consolidated financial statements.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><A NAME="operations"></A><B>Splash
Beverage Group, Inc.</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><B>[f/k/a Canfield Medical Supply, Inc.]</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B>Condensed
Consolidated Statements of Operations</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><B>For the Three- and Six- Months Ended June
30, 2020 and 2019</B></P>
<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"></P>

<P STYLE="font: 12pt Times New Roman, Times, Serif; margin: 0; text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B>(Unaudited)</B></FONT></P>

<P STYLE="font: 12pt Times New Roman, Times, Serif; margin: 0; text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>





<TABLE CELLSPACING="0" CELLPADDING="0" STYLE="font: 12pt Times New Roman, Times, Serif; width: 100%; border-collapse: collapse">
<TR STYLE="vertical-align: bottom">
    <TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="3" STYLE="border-bottom: black 1pt solid; text-align: center"><FONT STYLE="font-size: 10pt"><B>Three months ended June 30, 2020</B></FONT></TD>
    <TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="3" STYLE="border-bottom: black 1pt solid; text-align: center"><FONT STYLE="font-size: 10pt"><B>Three months ended June 30, 2019</B></FONT></TD>
    <TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="3" STYLE="border-bottom: black 1pt solid; text-align: center"><FONT STYLE="font-size: 10pt"><B>Six months ended June 30, 2020</B></FONT></TD>
    <TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="3" STYLE="border-bottom: black 1pt solid; text-align: center"><FONT STYLE="font-size: 10pt"><B>Six months ended June 30, 2019</B></FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: #CCEEFF">
    <TD STYLE="width: 52%"><FONT STYLE="font-size: 10pt">Net revenues</FONT></TD>
    <TD STYLE="width: 1%">&nbsp;</TD>
    <TD STYLE="width: 1%"><FONT STYLE="font-size: 10pt">$</FONT></TD>
    <TD STYLE="width: 9%; text-align: right"><FONT STYLE="font-size: 10pt">612,308</FONT></TD>
    <TD STYLE="width: 1%">&nbsp;</TD>
    <TD STYLE="width: 1%">&nbsp;</TD>
    <TD STYLE="width: 1%"><FONT STYLE="font-size: 10pt">$</FONT></TD>
    <TD STYLE="width: 9%; text-align: right"><FONT STYLE="font-size: 10pt">42,775</FONT></TD>
    <TD STYLE="width: 1%">&nbsp;</TD>
    <TD STYLE="width: 1%">&nbsp;</TD>
    <TD STYLE="width: 1%"><FONT STYLE="font-size: 10pt">$</FONT></TD>
    <TD STYLE="width: 9%; text-align: right"><FONT STYLE="font-size: 10pt">724,311</FONT></TD>
    <TD STYLE="width: 1%">&nbsp;</TD>
    <TD STYLE="width: 1%">&nbsp;</TD>
    <TD STYLE="width: 1%"><FONT STYLE="font-size: 10pt">$</FONT></TD>
    <TD STYLE="width: 9%; text-align: right"><FONT STYLE="font-size: 10pt">48,105</FONT></TD>
    <TD STYLE="width: 1%">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: white">
    <TD STYLE="padding-bottom: 1pt"><FONT STYLE="font-size: 10pt">Cost of goods sold</FONT></TD>
    <TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid; text-align: right"><FONT STYLE="font-size: 10pt">(287,773</FONT></TD>
    <TD STYLE="padding-bottom: 1pt"><FONT STYLE="font-size: 10pt">)</FONT></TD>
    <TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid; text-align: right"><FONT STYLE="font-size: 10pt">(48,215</FONT></TD>
    <TD STYLE="padding-bottom: 1pt"><FONT STYLE="font-size: 10pt">)</FONT></TD>
    <TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid; text-align: right"><FONT STYLE="font-size: 10pt">(394,987</FONT></TD>
    <TD STYLE="padding-bottom: 1pt"><FONT STYLE="font-size: 10pt">)</FONT></TD>
    <TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid; text-align: right"><FONT STYLE="font-size: 10pt">(74,418</FONT></TD>
    <TD STYLE="padding-bottom: 1pt"><FONT STYLE="font-size: 10pt">)</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: #CCEEFF">
    <TD><FONT STYLE="font-size: 10pt">Gross margin</FONT></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">324,535</FONT></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">(5,440</FONT></TD>
    <TD><FONT STYLE="font-size: 10pt">)</FONT></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">329,324</FONT></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">(26,313</FONT></TD>
    <TD><FONT STYLE="font-size: 10pt">)</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: white">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">&nbsp;</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: #CCEEFF">
    <TD><FONT STYLE="font-size: 10pt">Operating expenses:</FONT></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">&nbsp;</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: white">
    <TD STYLE="padding-left: 10pt"><FONT STYLE="font-size: 10pt">Contracted services</FONT></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">165,697</FONT></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">179,714</FONT></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">423,678</FONT></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">430,770</FONT></TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: #CCEEFF">
    <TD STYLE="padding-left: 10pt"><FONT STYLE="font-size: 10pt">Salary and wages</FONT></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">365,013</FONT></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">16,378</FONT></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">606,689</FONT></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">412,262</FONT></TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: white">
    <TD STYLE="padding-left: 10pt"><FONT STYLE="font-size: 10pt">Other general and administrative</FONT></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">156,258</FONT></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">79,456</FONT></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">1,189,671</FONT></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">301,843</FONT></TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: #CCEEFF">
    <TD STYLE="padding-bottom: 1pt; padding-left: 10pt"><FONT STYLE="font-size: 10pt">Sales and marketing</FONT></TD>
    <TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid; text-align: right"><FONT STYLE="font-size: 10pt">24,230</FONT></TD>
    <TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid; text-align: right"><FONT STYLE="font-size: 10pt">27,164</FONT></TD>
    <TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid; text-align: right"><FONT STYLE="font-size: 10pt">47,242</FONT></TD>
    <TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid; text-align: right"><FONT STYLE="font-size: 10pt">32,652</FONT></TD>
    <TD STYLE="padding-bottom: 1pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: white">
    <TD STYLE="padding-left: 10pt"><FONT STYLE="font-size: 10pt">&nbsp;&nbsp;Total operating expenses</FONT></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">711,198</FONT></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">302,712</FONT></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">2,267,280</FONT></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">1,177,527</FONT></TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: #CCEEFF">
    <TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid; text-align: right">&nbsp;</TD>
    <TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid; text-align: right">&nbsp;</TD>
    <TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid; text-align: right">&nbsp;</TD>
    <TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid; text-align: right">&nbsp;</TD>
    <TD STYLE="padding-bottom: 1pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: white">
    <TD><FONT STYLE="font-size: 10pt">Loss from operations</FONT></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">(386,663</FONT></TD>
    <TD><FONT STYLE="font-size: 10pt">)</FONT></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">(308,152</FONT></TD>
    <TD><FONT STYLE="font-size: 10pt">)</FONT></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">(1,937,956</FONT></TD>
    <TD><FONT STYLE="font-size: 10pt">)</FONT></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">(1,203,840</FONT></TD>
    <TD><FONT STYLE="font-size: 10pt">)</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: #CCEEFF">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">&nbsp;</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: white">
    <TD><FONT STYLE="font-size: 10pt">Other income/(expense):</FONT></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">&nbsp;</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: #CCEEFF">
    <TD STYLE="padding-left: 10pt"><FONT STYLE="font-size: 10pt">Interest income</FONT></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">205</FONT></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">&mdash;&nbsp;&nbsp;</FONT></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">16,356</FONT></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">&mdash;&nbsp;&nbsp;</FONT></TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: white">
    <TD STYLE="padding-left: 10pt"><FONT STYLE="font-size: 10pt">Interest expense</FONT></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">(21,854</FONT></TD>
    <TD><FONT STYLE="font-size: 10pt">)</FONT></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">89,763&nbsp;&nbsp;</FONT></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">(1,935,491</FONT></TD>
    <TD><FONT STYLE="font-size: 10pt">)</FONT></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">(420,524</FONT></TD>
    <TD><FONT STYLE="font-size: 10pt">)</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: #CCEEFF">
    <TD STYLE="padding-bottom: 1pt; padding-left: 10pt"><FONT STYLE="font-size: 10pt">Gain from debt extinguishment</FONT></TD>
    <TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid; text-align: right"><FONT STYLE="font-size: 10pt">34,962</FONT></TD>
    <TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid; text-align: right"><FONT STYLE="font-size: 10pt">&mdash;&nbsp;&nbsp;</FONT></TD>
    <TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid; text-align: right"><FONT STYLE="font-size: 10pt">34,962</FONT></TD>
    <TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid; text-align: right"><FONT STYLE="font-size: 10pt">&mdash;&nbsp;&nbsp;</FONT></TD>
    <TD STYLE="padding-bottom: 1pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: white">
    <TD STYLE="padding-left: 20pt"><FONT STYLE="font-size: 10pt">Total other income/(expense)</FONT></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">13,313</FONT></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">89,763</FONT></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">(1,884,172</FONT></TD>
    <TD><FONT STYLE="font-size: 10pt">)</FONT></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">(420,524</FONT></TD>
    <TD><FONT STYLE="font-size: 10pt">)</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: #CCEEFF">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">&nbsp;</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: white">
    <TD><FONT STYLE="font-size: 10pt">Provision for income taxes</FONT></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">&mdash;&nbsp;&nbsp;</FONT></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">&mdash;&nbsp;&nbsp;</FONT></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">&mdash;&nbsp;&nbsp;</FONT></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">&mdash;&nbsp;&nbsp;</FONT></TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: #CCEEFF">
    <TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid; text-align: right">&nbsp;</TD>
    <TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid; text-align: right">&nbsp;</TD>
    <TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid; text-align: right">&nbsp;</TD>
    <TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid; text-align: right">&nbsp;</TD>
    <TD STYLE="padding-bottom: 1pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: white">
    <TD STYLE="padding-bottom: 2.5pt; padding-left: 10pt"><FONT STYLE="font-size: 10pt">Net loss</FONT></TD>
    <TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: black 2.25pt double"><FONT STYLE="font-size: 10pt">$</FONT></TD>
    <TD STYLE="border-bottom: black 2.25pt double; text-align: right"><FONT STYLE="font-size: 10pt">(373,350</FONT></TD>
    <TD STYLE="padding-bottom: 2.5pt"><FONT STYLE="font-size: 10pt">)</FONT></TD>
    <TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: black 2.25pt double"><FONT STYLE="font-size: 10pt">$</FONT></TD>
    <TD STYLE="border-bottom: black 2.25pt double; text-align: right"><FONT STYLE="font-size: 10pt">(218,389</FONT></TD>
    <TD STYLE="padding-bottom: 2.5pt"><FONT STYLE="font-size: 10pt">)</FONT></TD>
    <TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: black 2.25pt double"><FONT STYLE="font-size: 10pt">$</FONT></TD>
    <TD STYLE="border-bottom: black 2.25pt double; text-align: right"><FONT STYLE="font-size: 10pt">(3,822,129</FONT></TD>
    <TD STYLE="padding-bottom: 2.5pt"><FONT STYLE="font-size: 10pt">)</FONT></TD>
    <TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: black 2.25pt double"><FONT STYLE="font-size: 10pt">$</FONT></TD>
    <TD STYLE="border-bottom: black 2.25pt double; text-align: right"><FONT STYLE="font-size: 10pt">(1,624,364</FONT></TD>
    <TD STYLE="padding-bottom: 2.5pt"><FONT STYLE="font-size: 10pt">)</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: #CCEEFF">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">&nbsp;</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: white">
    <TD STYLE="padding-bottom: 2.5pt"><FONT STYLE="font-size: 10pt">Net loss per share (basic and diluted)</FONT></TD>
    <TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: black 2.25pt double"><FONT STYLE="font-size: 10pt">$</FONT></TD>
    <TD STYLE="border-bottom: black 2.25pt double; text-align: right"><FONT STYLE="font-size: 10pt">(0.01</FONT></TD>
    <TD STYLE="padding-bottom: 2.5pt"><FONT STYLE="font-size: 10pt">)</FONT></TD>
    <TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: black 2.25pt double"><FONT STYLE="font-size: 10pt">$</FONT></TD>
    <TD STYLE="border-bottom: black 2.25pt double; text-align: right"><FONT STYLE="font-size: 10pt">(0.01</FONT></TD>
    <TD STYLE="padding-bottom: 2.5pt"><FONT STYLE="font-size: 10pt">)</FONT></TD>
    <TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: black 2.25pt double"><FONT STYLE="font-size: 10pt">$</FONT></TD>
    <TD STYLE="border-bottom: black 2.25pt double; text-align: right"><FONT STYLE="font-size: 10pt">(0.07</FONT></TD>
    <TD STYLE="padding-bottom: 2.5pt"><FONT STYLE="font-size: 10pt">)</FONT></TD>
    <TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: black 2.25pt double"><FONT STYLE="font-size: 10pt">$</FONT></TD>
    <TD STYLE="border-bottom: black 2.25pt double; text-align: right"><FONT STYLE="font-size: 10pt">(0.04</FONT></TD>
    <TD STYLE="padding-bottom: 2.5pt"><FONT STYLE="font-size: 10pt">)</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: #CCEEFF">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">&nbsp;</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: white">
    <TD STYLE="padding-bottom: 2.5pt"><FONT STYLE="font-size: 10pt">Weighted average number of common shares outstanding</FONT></TD>
    <TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: black 2.25pt double">&nbsp;</TD>
    <TD STYLE="border-bottom: black 2.25pt double; text-align: right"><FONT STYLE="font-size: 10pt">56,908,703</FONT></TD>
    <TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: black 2.25pt double">&nbsp;</TD>
    <TD STYLE="border-bottom: black 2.25pt double; text-align: right"><FONT STYLE="font-size: 10pt">41,807,563</FONT></TD>
    <TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: black 2.25pt double">&nbsp;</TD>
    <TD STYLE="border-bottom: black 2.25pt double; text-align: right"><FONT STYLE="font-size: 10pt">51,113,403</FONT></TD>
    <TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: black 2.25pt double">&nbsp;</TD>
    <TD STYLE="border-bottom: black 2.25pt double; text-align: right"><FONT STYLE="font-size: 10pt">41,603,074</FONT></TD>
    <TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD></TR>
</TABLE>
<P STYLE="font: 12pt Times New Roman, Times, Serif; margin: 0; text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">The
accompanying notes are an integral part of these condensed consolidated financial statements.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B>&nbsp;</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B>Splash
Beverage Group, Inc.</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><B>[f/k/a Canfield Medical Supply, Inc.]</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><A NAME="stockholderequity"></A><B>Condensed
Consolidated Statement of Deficiency in Stockholders&rsquo; Equity</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center; text-indent: 20pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B>For
the six months ended June 30, 2020 and 2019</B></FONT></P>

<P STYLE="font: 12pt Times New Roman, Times, Serif; margin: 0; text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B>(Unaudited)</B>&nbsp;&nbsp;</FONT></P>

<P STYLE="font: 12pt Times New Roman, Times, Serif; margin: 0; text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 12pt Times New Roman, Times, Serif; margin: 0; text-align: center"></P>


<P STYLE="font: 12pt Times New Roman, Times, Serif; margin: 0; text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>


<TABLE CELLSPACING="0" CELLPADDING="0" STYLE="font: 12pt Times New Roman, Times, Serif; width: 100%; border-collapse: collapse">
<TR>
    <TD COLSPAN="5" STYLE="vertical-align: top">&nbsp;</TD>
    <TD COLSPAN="3" STYLE="vertical-align: bottom; text-align: center">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD COLSPAN="3" STYLE="vertical-align: bottom; text-align: center">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD COLSPAN="3" STYLE="vertical-align: bottom; text-align: center">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD COLSPAN="3" STYLE="vertical-align: bottom; text-align: center">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD COLSPAN="3" STYLE="vertical-align: bottom; text-align: center">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD COLSPAN="3" STYLE="vertical-align: bottom; text-align: center">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom; text-align: center"><FONT STYLE="font-size: 10pt"><B>Total</B></FONT></TD></TR>
<TR>
    <TD COLSPAN="2" STYLE="vertical-align: top">&nbsp;</TD>
    <TD STYLE="vertical-align: top">&nbsp;</TD>
    <TD STYLE="vertical-align: top">&nbsp;</TD>
    <TD STYLE="vertical-align: top">&nbsp;</TD>
    <TD COLSPAN="7" STYLE="vertical-align: bottom; text-align: center"><FONT STYLE="font-size: 10pt"><B>Common Stock</B></FONT></TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD COLSPAN="7" STYLE="vertical-align: bottom; text-align: center"><FONT STYLE="font-size: 10pt"><B>Treasury Stock</B></FONT></TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD COLSPAN="3" STYLE="vertical-align: bottom; text-align: center"><FONT STYLE="font-size: 10pt"><B>Additional</B></FONT></TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD COLSPAN="3" STYLE="vertical-align: bottom; text-align: center"><FONT STYLE="font-size: 10pt"><B>Accumulated</B></FONT></TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom; text-align: center"><FONT STYLE="font-size: 10pt"><B>Stockholders'</B></FONT></TD></TR>
<TR>
    <TD COLSPAN="2" STYLE="vertical-align: top">&nbsp;</TD>
    <TD STYLE="vertical-align: top; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="vertical-align: top">&nbsp;</TD>
    <TD STYLE="vertical-align: top; padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="3" STYLE="border-bottom: black 1pt solid; vertical-align: bottom; text-align: center"><FONT STYLE="font-size: 10pt"><B>Shares</B></FONT></TD>
    <TD STYLE="vertical-align: bottom; padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="3" STYLE="border-bottom: black 1pt solid; vertical-align: bottom; text-align: center"><FONT STYLE="font-size: 10pt"><B>Amount</B></FONT></TD>
    <TD STYLE="vertical-align: bottom; padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="3" STYLE="border-bottom: black 1pt solid; vertical-align: bottom; text-align: center"><FONT STYLE="font-size: 10pt"><B>Shares</B></FONT></TD>
    <TD STYLE="vertical-align: bottom; padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="3" STYLE="border-bottom: black 1pt solid; vertical-align: bottom; text-align: center"><FONT STYLE="font-size: 10pt"><B>Amount</B></FONT></TD>
    <TD STYLE="vertical-align: bottom; padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="3" STYLE="border-bottom: black 1pt solid; vertical-align: bottom; text-align: center"><FONT STYLE="font-size: 10pt"><B>Paid-In Capital</B></FONT></TD>
    <TD STYLE="vertical-align: bottom; padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="3" STYLE="border-bottom: black 1pt solid; vertical-align: bottom; text-align: center"><FONT STYLE="font-size: 10pt"><B>Deficit</B></FONT></TD>
    <TD STYLE="vertical-align: bottom; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid; vertical-align: bottom; text-align: center"><FONT STYLE="font-size: 10pt"><B>Equity (Deficit)</B></FONT></TD></TR>
<TR>
    <TD COLSPAN="2" STYLE="vertical-align: top">&nbsp;</TD>
    <TD STYLE="vertical-align: top">&nbsp;</TD>
    <TD STYLE="vertical-align: top">&nbsp;</TD>
    <TD STYLE="vertical-align: top">&nbsp;</TD>
    <TD COLSPAN="3" STYLE="vertical-align: bottom; text-align: center">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD COLSPAN="3" STYLE="vertical-align: bottom; text-align: center">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD COLSPAN="3" STYLE="vertical-align: bottom; text-align: center">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD COLSPAN="3" STYLE="vertical-align: bottom; text-align: center">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD COLSPAN="3" STYLE="vertical-align: bottom; text-align: center">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD COLSPAN="3" STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="background-color: #CCEEFF">
    <TD COLSPAN="4" STYLE="vertical-align: top"><FONT STYLE="font-size: 10pt"><B>Balances at December 31, 2018</B></FONT></TD>
    <TD STYLE="vertical-align: top; padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: black 2.25pt double; vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="border-bottom: black 2.25pt double; vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 10pt">40,165,002</FONT></TD>
    <TD STYLE="vertical-align: bottom; padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom; padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: black 2.25pt double; vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="border-bottom: black 2.25pt double; vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 10pt">40,165</FONT></TD>
    <TD STYLE="vertical-align: bottom; padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom; padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: black 2.25pt double; vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="border-bottom: black 2.25pt double; vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 10pt">272,585</FONT></TD>
    <TD STYLE="vertical-align: bottom; padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom; padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: black 2.25pt double; vertical-align: bottom"><FONT STYLE="font-size: 10pt">$</FONT></TD>
    <TD STYLE="border-bottom: black 2.25pt double; vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 10pt">(100,000</FONT></TD>
    <TD STYLE="vertical-align: bottom; padding-bottom: 2.5pt"><FONT STYLE="font-size: 10pt">)</FONT></TD>
    <TD STYLE="vertical-align: bottom; padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: black 2.25pt double; vertical-align: bottom"><FONT STYLE="font-size: 10pt">$</FONT></TD>
    <TD STYLE="border-bottom: black 2.25pt double; vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 10pt">18,938,480</FONT></TD>
    <TD STYLE="vertical-align: bottom; padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom; padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: black 2.25pt double; vertical-align: bottom"><FONT STYLE="font-size: 10pt">$</FONT></TD>
    <TD STYLE="border-bottom: black 2.25pt double; vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 10pt">(26,709,776</FONT></TD>
    <TD STYLE="vertical-align: bottom; padding-bottom: 2.5pt"><FONT STYLE="font-size: 10pt">)</FONT></TD>
    <TD STYLE="vertical-align: bottom; padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: black 2.25pt double; vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 10pt">$(7,831,132)</FONT></TD></TR>
<TR STYLE="background-color: white">
    <TD STYLE="vertical-align: top">&nbsp;</TD>
    <TD STYLE="vertical-align: top">&nbsp;</TD>
    <TD STYLE="vertical-align: top">&nbsp;</TD>
    <TD STYLE="vertical-align: top">&nbsp;</TD>
    <TD STYLE="vertical-align: top">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom; text-align: right">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom; text-align: right">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom; text-align: right">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom; text-align: right">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom; text-align: right">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom; text-align: right">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="background-color: #CCEEFF">
    <TD COLSPAN="4" STYLE="vertical-align: top"><FONT STYLE="font-size: 10pt">Issuance of Common stock for cash</FONT></TD>
    <TD STYLE="vertical-align: top">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 10pt">27,258</FONT></TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 10pt">27</FONT></TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 10pt">&mdash;&nbsp;&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 10pt">&mdash;&nbsp;&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 10pt">19,973</FONT></TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 10pt">&mdash;&nbsp;&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 10pt">$20,000</FONT></TD></TR>
<TR STYLE="background-color: white">
    <TD COLSPAN="4" STYLE="vertical-align: top"><FONT STYLE="font-size: 10pt">Issuance of Common stock for services</FONT></TD>
    <TD STYLE="vertical-align: top">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 10pt">1,363</FONT></TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 10pt">1</FONT></TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 10pt">&mdash;&nbsp;&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 10pt">&mdash;&nbsp;&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 10pt">999</FONT></TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 10pt">&mdash;&nbsp;&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 10pt">1,000</FONT></TD></TR>
<TR STYLE="background-color: #CCEEFF">
    <TD COLSPAN="4" STYLE="vertical-align: top"><FONT STYLE="font-size: 10pt">Share-based compensation</FONT></TD>
    <TD STYLE="vertical-align: top">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 10pt">&mdash;&nbsp;&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 10pt">&mdash;&nbsp;&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 10pt">&mdash;&nbsp;&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 10pt">&mdash;&nbsp;&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 10pt">&mdash;&nbsp;&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 10pt">&mdash;&nbsp;&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 10pt">-</FONT></TD></TR>
<TR STYLE="background-color: white">
    <TD COLSPAN="4" STYLE="vertical-align: top"><FONT STYLE="font-size: 10pt">Net loss</FONT></TD>
    <TD STYLE="vertical-align: top; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid; vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid; vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 10pt">&mdash;&nbsp;&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid; vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid; vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 10pt">&mdash;&nbsp;&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid; vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid; vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 10pt">&mdash;&nbsp;&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid; vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid; vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 10pt">&mdash;&nbsp;&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid; vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid; vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 10pt">&mdash;&nbsp;&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid; vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid; vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 10pt">(703,624</FONT></TD>
    <TD STYLE="vertical-align: bottom; padding-bottom: 1pt"><FONT STYLE="font-size: 10pt">)</FONT></TD>
    <TD STYLE="vertical-align: bottom; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid; vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 10pt">(703,624)</FONT></TD></TR>
<TR STYLE="background-color: #CCEEFF">
    <TD STYLE="vertical-align: top">&nbsp;</TD>
    <TD STYLE="vertical-align: top">&nbsp;</TD>
    <TD STYLE="vertical-align: top">&nbsp;</TD>
    <TD STYLE="vertical-align: top">&nbsp;</TD>
    <TD STYLE="vertical-align: top">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom; text-align: right">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom; text-align: right">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom; text-align: right">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom; text-align: right">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom; text-align: right">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom; text-align: right">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="background-color: white">
    <TD COLSPAN="4" STYLE="vertical-align: top"><FONT STYLE="font-size: 10pt"><B>Balances at March 31, 2019</B></FONT></TD>
    <TD STYLE="vertical-align: top; padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: black 2.25pt double; vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="border-bottom: black 2.25pt double; vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 10pt">40,193,623</FONT></TD>
    <TD STYLE="vertical-align: bottom; padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom; padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: black 2.25pt double; vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="border-bottom: black 2.25pt double; vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 10pt">40,193</FONT></TD>
    <TD STYLE="vertical-align: bottom; padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom; padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: black 2.25pt double; vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="border-bottom: black 2.25pt double; vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 10pt">272,585</FONT></TD>
    <TD STYLE="vertical-align: bottom; padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom; padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: black 2.25pt double; vertical-align: bottom"><FONT STYLE="font-size: 10pt">$</FONT></TD>
    <TD STYLE="border-bottom: black 2.25pt double; vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 10pt">(100,000</FONT></TD>
    <TD STYLE="vertical-align: bottom; padding-bottom: 2.5pt"><FONT STYLE="font-size: 10pt">)</FONT></TD>
    <TD STYLE="vertical-align: bottom; padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: black 2.25pt double; vertical-align: bottom"><FONT STYLE="font-size: 10pt">$</FONT></TD>
    <TD STYLE="border-bottom: black 2.25pt double; vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 10pt">18,959,452</FONT></TD>
    <TD STYLE="vertical-align: bottom; padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom; padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: black 2.25pt double; vertical-align: bottom"><FONT STYLE="font-size: 10pt">$</FONT></TD>
    <TD STYLE="border-bottom: black 2.25pt double; vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 10pt">(27,413,400</FONT></TD>
    <TD STYLE="vertical-align: bottom; padding-bottom: 2.5pt"><FONT STYLE="font-size: 10pt">)</FONT></TD>
    <TD STYLE="vertical-align: bottom; padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: black 2.25pt double; vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 10pt">$(8,513,755)</FONT></TD></TR>
<TR STYLE="background-color: #CCEEFF">
    <TD STYLE="vertical-align: top">&nbsp;</TD>
    <TD STYLE="vertical-align: top">&nbsp;</TD>
    <TD STYLE="vertical-align: top">&nbsp;</TD>
    <TD STYLE="vertical-align: top">&nbsp;</TD>
    <TD STYLE="vertical-align: top">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom; text-align: right">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom; text-align: right">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom; text-align: right">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom; text-align: right">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom; text-align: right">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom; text-align: right">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="background-color: white">
    <TD COLSPAN="4" STYLE="vertical-align: top"><FONT STYLE="font-size: 10pt">Issuance of Common stock for cash</FONT></TD>
    <TD STYLE="vertical-align: top">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 10pt">483,837</FONT></TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 10pt">484</FONT></TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 10pt">&mdash;&nbsp;&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 10pt">&mdash;&nbsp;&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 10pt">354,516</FONT></TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 10pt">&mdash;&nbsp;&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 10pt">$355,000</FONT></TD></TR>
<TR STYLE="background-color: #CCEEFF">
    <TD COLSPAN="4" STYLE="vertical-align: top"><FONT STYLE="font-size: 10pt">Issuance of Common stock for services</FONT></TD>
    <TD STYLE="vertical-align: top">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 10pt">&mdash;&nbsp;&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 10pt">&mdash;&nbsp;&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 10pt">&mdash;&nbsp;&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 10pt">&mdash;&nbsp;&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 10pt">&mdash;&nbsp;&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 10pt">&mdash;&nbsp;&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 10pt">-</FONT></TD></TR>
<TR STYLE="background-color: white">
    <TD COLSPAN="4" STYLE="vertical-align: top"><FONT STYLE="font-size: 10pt">Issuance of series B convertible preferred stock</FONT></TD>
    <TD STYLE="vertical-align: top">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 10pt">&mdash;&nbsp;&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 10pt">&mdash;&nbsp;&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 10pt">&mdash;&nbsp;&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 10pt">&mdash;&nbsp;&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 10pt">&mdash;&nbsp;&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 10pt">&mdash;&nbsp;&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 10pt">-</FONT></TD></TR>
<TR STYLE="background-color: #CCEEFF">
    <TD COLSPAN="4" STYLE="vertical-align: top"><FONT STYLE="font-size: 10pt">Issuance of Common stock from treasury</FONT></TD>
    <TD STYLE="vertical-align: top">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 10pt">&mdash;&nbsp;&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 10pt">&mdash;&nbsp;&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 10pt">&mdash;&nbsp;&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 10pt">&mdash;&nbsp;&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 10pt">&mdash;&nbsp;&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 10pt">&mdash;&nbsp;&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 10pt">-</FONT></TD></TR>
<TR STYLE="background-color: white">
    <TD COLSPAN="4" STYLE="vertical-align: top"><FONT STYLE="font-size: 10pt">Warrants issued in connection with debt modification</FONT></TD>
    <TD STYLE="vertical-align: top">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 10pt">&mdash;&nbsp;&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 10pt">&mdash;&nbsp;&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 10pt">&mdash;&nbsp;&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 10pt">&mdash;&nbsp;&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 10pt">&mdash;&nbsp;&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 10pt">&mdash;&nbsp;&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 10pt">-</FONT></TD></TR>
<TR STYLE="background-color: #CCEEFF">
    <TD COLSPAN="4" STYLE="vertical-align: top"><FONT STYLE="font-size: 10pt">Share-based compensation</FONT></TD>
    <TD STYLE="vertical-align: top">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 10pt">&mdash;&nbsp;&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 10pt">&mdash;&nbsp;&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 10pt">&mdash;&nbsp;&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 10pt">&mdash;&nbsp;&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 10pt">&mdash;&nbsp;&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 10pt">&mdash;&nbsp;&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 10pt">-</FONT></TD></TR>
<TR STYLE="background-color: white">
    <TD COLSPAN="4" STYLE="vertical-align: top"><FONT STYLE="font-size: 10pt">Net loss</FONT></TD>
    <TD STYLE="vertical-align: top; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid; vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid; vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 10pt">&mdash;&nbsp;&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid; vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid; vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 10pt">&mdash;&nbsp;&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid; vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid; vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 10pt">&mdash;&nbsp;&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid; vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid; vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 10pt">&mdash;&nbsp;&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid; vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid; vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 10pt">&mdash;&nbsp;&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid; vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid; vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 10pt">(921,520</FONT></TD>
    <TD STYLE="vertical-align: bottom; padding-bottom: 1pt"><FONT STYLE="font-size: 10pt">)</FONT></TD>
    <TD STYLE="vertical-align: bottom; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid; vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 10pt">(921,520)</FONT></TD></TR>
<TR STYLE="background-color: #CCEEFF">
    <TD STYLE="vertical-align: top">&nbsp;</TD>
    <TD STYLE="vertical-align: top">&nbsp;</TD>
    <TD STYLE="vertical-align: top">&nbsp;</TD>
    <TD STYLE="vertical-align: top">&nbsp;</TD>
    <TD STYLE="vertical-align: top">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom; text-align: right">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom; text-align: right">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom; text-align: right">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom; text-align: right">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom; text-align: right">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom; text-align: right">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="background-color: white">
    <TD COLSPAN="4" STYLE="vertical-align: top"><FONT STYLE="font-size: 10pt"><B>Balances at June 30, 2019</B></FONT></TD>
    <TD STYLE="vertical-align: top; padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: black 2.25pt double; vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="border-bottom: black 2.25pt double; vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 10pt">40,677,460</FONT></TD>
    <TD STYLE="vertical-align: bottom; padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom; padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: black 2.25pt double; vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="border-bottom: black 2.25pt double; vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 10pt">40,677</FONT></TD>
    <TD STYLE="vertical-align: bottom; padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom; padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: black 2.25pt double; vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="border-bottom: black 2.25pt double; vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 10pt">272,585</FONT></TD>
    <TD STYLE="vertical-align: bottom; padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom; padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: black 2.25pt double; vertical-align: bottom"><FONT STYLE="font-size: 10pt">$</FONT></TD>
    <TD STYLE="border-bottom: black 2.25pt double; vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 10pt">(100,000</FONT></TD>
    <TD STYLE="vertical-align: bottom; padding-bottom: 2.5pt"><FONT STYLE="font-size: 10pt">)</FONT></TD>
    <TD STYLE="vertical-align: bottom; padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: black 2.25pt double; vertical-align: bottom"><FONT STYLE="font-size: 10pt">$</FONT></TD>
    <TD STYLE="border-bottom: black 2.25pt double; vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 10pt">19,313,968</FONT></TD>
    <TD STYLE="vertical-align: bottom; padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom; padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: black 2.25pt double; vertical-align: bottom"><FONT STYLE="font-size: 10pt">$</FONT></TD>
    <TD STYLE="border-bottom: black 2.25pt double; vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 10pt">(28,334,920</FONT></TD>
    <TD STYLE="vertical-align: bottom; padding-bottom: 2.5pt"><FONT STYLE="font-size: 10pt">)</FONT></TD>
    <TD STYLE="vertical-align: bottom; padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: black 2.25pt double; vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 10pt">$(9,080,275)</FONT></TD></TR>
<TR STYLE="background-color: #CCEEFF">
    <TD STYLE="vertical-align: top; width: 5%">&nbsp;</TD>
    <TD STYLE="vertical-align: top; width: 1%">&nbsp;</TD>
    <TD STYLE="vertical-align: top; width: 1%">&nbsp;</TD>
    <TD STYLE="vertical-align: top">&nbsp;</TD>
    <TD STYLE="vertical-align: top; width: 1%">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom; width: 1%">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom; width: 5%; text-align: right">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom; width: 1%">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom; width: 1%">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom; width: 1%">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom; width: 5%; text-align: right">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom; width: 1%">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom; width: 1%">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom; width: 1%">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom; width: 5%; text-align: right">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom; width: 1%">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom; width: 1%">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom; width: 1%">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom; width: 5%; text-align: right">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom; width: 1%">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom; width: 1%">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom; width: 1%">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom; width: 5%; text-align: right">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom; width: 1%">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom; width: 1%">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom; width: 1%">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom; width: 5%; text-align: right">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom; width: 1%">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom; width: 1%">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD></TR>
<TR STYLE="background-color: white">
    <TD STYLE="vertical-align: top">&nbsp;</TD>
    <TD STYLE="vertical-align: top">&nbsp;</TD>
    <TD STYLE="vertical-align: top">&nbsp;</TD>
    <TD STYLE="vertical-align: top">&nbsp;</TD>
    <TD STYLE="vertical-align: top">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD COLSPAN="5" STYLE="vertical-align: bottom; text-align: center"><FONT STYLE="font-size: 10pt"><B>Common Stock</B></FONT></TD>
    <TD STYLE="vertical-align: bottom; text-align: center">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom; text-align: center">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom; text-align: center">&nbsp;</TD>
    <TD COLSPAN="5" STYLE="vertical-align: bottom; text-align: center"><FONT STYLE="font-size: 10pt"><B>Treasury Stock</B></FONT></TD>
    <TD STYLE="vertical-align: bottom; text-align: center">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom; text-align: center">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom; text-align: center">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom; text-align: center"><FONT STYLE="font-size: 10pt"><B>Additional&nbsp;</B></FONT></TD>
    <TD STYLE="vertical-align: bottom; text-align: center">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom; text-align: center">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom; text-align: center">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom; text-align: center"><FONT STYLE="font-size: 10pt"><B>Accumulated</B></FONT></TD>
    <TD STYLE="vertical-align: bottom; text-align: center">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom; text-align: center">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">
        <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><B>Total</B></P>
        <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><B>Stockholders'</B></P></TD></TR>
<TR STYLE="background-color: #CCEEFF">
    <TD STYLE="vertical-align: top">&nbsp;</TD>
    <TD STYLE="vertical-align: top; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="vertical-align: top; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="vertical-align: top; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="vertical-align: top; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid; vertical-align: bottom; text-align: center">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid; vertical-align: bottom; text-align: center"><FONT STYLE="font-size: 10pt"><B>Shares</B></FONT></TD>
    <TD STYLE="vertical-align: bottom; padding-bottom: 1pt; text-align: center">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom; padding-bottom: 1pt; text-align: center">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid; vertical-align: bottom; text-align: center">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid; vertical-align: bottom; text-align: center"><FONT STYLE="font-size: 10pt"><B>Amount</B></FONT></TD>
    <TD STYLE="vertical-align: bottom; padding-bottom: 1pt; text-align: center">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom; padding-bottom: 1pt; text-align: center">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid; vertical-align: bottom; text-align: center">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid; vertical-align: bottom; text-align: center"><FONT STYLE="font-size: 10pt"><B>Shares</B></FONT></TD>
    <TD STYLE="vertical-align: bottom; padding-bottom: 1pt; text-align: center">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom; padding-bottom: 1pt; text-align: center">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid; vertical-align: bottom; text-align: center">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid; vertical-align: bottom; text-align: center"><FONT STYLE="font-size: 10pt"><B>Amount</B></FONT></TD>
    <TD STYLE="vertical-align: bottom; padding-bottom: 1pt; text-align: center">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom; padding-bottom: 1pt; text-align: center">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid; vertical-align: bottom; text-align: center">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid; white-space: nowrap; vertical-align: bottom; text-align: center"><FONT STYLE="font-size: 10pt"><B>Paid-In Capital</B></FONT></TD>
    <TD STYLE="vertical-align: bottom; padding-bottom: 1pt; text-align: center">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom; padding-bottom: 1pt; text-align: center">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid; vertical-align: bottom; text-align: center">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid; vertical-align: bottom; text-align: center"><FONT STYLE="font-size: 10pt"><B>Deficit</B></FONT></TD>
    <TD STYLE="vertical-align: bottom; padding-bottom: 1pt; text-align: center">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom; padding-bottom: 1pt; text-align: center">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid; vertical-align: bottom; text-align: center"><FONT STYLE="font-size: 10pt"><B>Equity (Deficit)</B></FONT></TD></TR>
<TR STYLE="background-color: white">
    <TD COLSPAN="4" STYLE="vertical-align: top"><FONT STYLE="font-size: 10pt"><B>Balances at December 31, 2019</B></FONT></TD>
    <TD STYLE="vertical-align: top; padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: black 2.25pt double; vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="border-bottom: black 2.25pt double; vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 10pt">44,021,389</FONT></TD>
    <TD STYLE="vertical-align: bottom; padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom; padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: black 2.25pt double; vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="border-bottom: black 2.25pt double; vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 10pt">44,021</FONT></TD>
    <TD STYLE="vertical-align: bottom; padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom; padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: black 2.25pt double; vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="border-bottom: black 2.25pt double; vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 10pt">136,293</FONT></TD>
    <TD STYLE="vertical-align: bottom; padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom; padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: black 2.25pt double; vertical-align: bottom"><FONT STYLE="font-size: 10pt">$</FONT></TD>
    <TD STYLE="border-bottom: black 2.25pt double; vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 10pt">(50,000</FONT></TD>
    <TD STYLE="vertical-align: bottom; padding-bottom: 2.5pt"><FONT STYLE="font-size: 10pt">)</FONT></TD>
    <TD STYLE="vertical-align: bottom; padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: black 2.25pt double; vertical-align: bottom"><FONT STYLE="font-size: 10pt">$</FONT></TD>
    <TD STYLE="border-bottom: black 2.25pt double; vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 10pt">22,095,403</FONT></TD>
    <TD STYLE="vertical-align: bottom; padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom; padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: black 2.25pt double; vertical-align: bottom"><FONT STYLE="font-size: 10pt">$</FONT></TD>
    <TD STYLE="border-bottom: black 2.25pt double; vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 10pt">(31,845,506</FONT></TD>
    <TD STYLE="vertical-align: bottom; padding-bottom: 2.5pt"><FONT STYLE="font-size: 10pt">)</FONT></TD>
    <TD STYLE="vertical-align: bottom; padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: black 2.25pt double; vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 10pt">$(9,756,084)</FONT></TD></TR>
<TR STYLE="background-color: #CCEEFF">
    <TD STYLE="vertical-align: top">&nbsp;</TD>
    <TD STYLE="vertical-align: top">&nbsp;</TD>
    <TD STYLE="vertical-align: top">&nbsp;</TD>
    <TD STYLE="vertical-align: top">&nbsp;</TD>
    <TD STYLE="vertical-align: top">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom; text-align: right">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom; text-align: right">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom; text-align: right">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom; text-align: right">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom; text-align: right">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom; text-align: right">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="background-color: white">
    <TD COLSPAN="4" STYLE="vertical-align: top"><FONT STYLE="font-size: 10pt">Issuance of common stock for convertible debt</FONT></TD>
    <TD STYLE="vertical-align: top">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 10pt">&mdash;&nbsp;&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 10pt">&mdash;&nbsp;&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 10pt">&mdash;&nbsp;&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 10pt">&mdash;&nbsp;&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 10pt">145,579</FONT></TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 10pt">&mdash;&nbsp;&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 10pt">145,579</FONT></TD></TR>
<TR STYLE="background-color: #CCEEFF">
    <TD COLSPAN="4" STYLE="vertical-align: top"><FONT STYLE="font-size: 10pt">Incremental beneficial conversion for preferred A</FONT></TD>
    <TD STYLE="vertical-align: top">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 10pt">&mdash;&nbsp;&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 10pt">&mdash;&nbsp;&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 10pt">&mdash;&nbsp;&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 10pt">&mdash;&nbsp;&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 10pt">240,770</FONT></TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 10pt">(240,770</FONT></TD>
    <TD STYLE="vertical-align: bottom"><FONT STYLE="font-size: 10pt">)</FONT></TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 10pt">-</FONT></TD></TR>
<TR STYLE="background-color: white">
    <TD COLSPAN="4" STYLE="vertical-align: top"><FONT STYLE="font-size: 10pt">Issuance of warrants on convertible instruments</FONT></TD>
    <TD STYLE="vertical-align: top">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 10pt">&mdash;&nbsp;&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 10pt">&mdash;&nbsp;&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 10pt">&mdash;&nbsp;&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 10pt">&mdash;&nbsp;&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 10pt">2,486,706</FONT></TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 10pt">(828,903</FONT></TD>
    <TD STYLE="vertical-align: bottom"><FONT STYLE="font-size: 10pt">)</FONT></TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 10pt">1,657,803</FONT></TD></TR>
<TR STYLE="background-color: #CCEEFF">
    <TD COLSPAN="4" STYLE="vertical-align: top"><FONT STYLE="font-size: 10pt">Issuance of common stock for services</FONT></TD>
    <TD STYLE="vertical-align: top">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 10pt">817,753</FONT></TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 10pt">818</FONT></TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 10pt">(136,293</FONT></TD>
    <TD STYLE="vertical-align: bottom"><FONT STYLE="font-size: 10pt">)</FONT></TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 10pt">50,000</FONT></TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 10pt">549,182</FONT></TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 10pt">&mdash;&nbsp;&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 10pt">600,000</FONT></TD></TR>
<TR STYLE="background-color: white">
    <TD COLSPAN="4" STYLE="vertical-align: top"><FONT STYLE="font-size: 10pt">Issuance of common stock for acquisition</FONT></TD>
    <TD STYLE="vertical-align: top">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 10pt">11,913,200</FONT></TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 10pt">11,913</FONT></TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 10pt">&mdash;&nbsp;&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 10pt">&mdash;&nbsp;&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 10pt">9,161,251</FONT></TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 10pt">&mdash;&nbsp;&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 10pt">9,173,164</FONT></TD></TR>
<TR STYLE="background-color: #CCEEFF">
    <TD COLSPAN="4" STYLE="vertical-align: top"><FONT STYLE="font-size: 10pt">Net loss</FONT></TD>
    <TD STYLE="vertical-align: top; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid; vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid; vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 10pt">&mdash;&nbsp;&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid; vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid; vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 10pt">&mdash;&nbsp;&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid; vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid; vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 10pt">&mdash;&nbsp;&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid; vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid; vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 10pt">&mdash;&nbsp;&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid; vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid; vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 10pt">&mdash;&nbsp;&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid; vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid; vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 10pt">(3,446,630</FONT></TD>
    <TD STYLE="vertical-align: bottom; padding-bottom: 1pt"><FONT STYLE="font-size: 10pt">)</FONT></TD>
    <TD STYLE="vertical-align: bottom; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid; vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 10pt">(3,446,630)</FONT></TD></TR>
<TR STYLE="background-color: white">
    <TD STYLE="vertical-align: top">&nbsp;</TD>
    <TD STYLE="vertical-align: top">&nbsp;</TD>
    <TD STYLE="vertical-align: top">&nbsp;</TD>
    <TD STYLE="vertical-align: top">&nbsp;</TD>
    <TD STYLE="vertical-align: top">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom; text-align: right">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom; text-align: right">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom; text-align: right">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom; text-align: right">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom; text-align: right">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom; text-align: right">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="background-color: #CCEEFF">
    <TD COLSPAN="4" STYLE="vertical-align: top"><FONT STYLE="font-size: 10pt"><B>Balances at March 31, 2020</B></FONT></TD>
    <TD STYLE="vertical-align: top; padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: black 2.25pt double; vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="border-bottom: black 2.25pt double; vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 10pt">56,752,342</FONT></TD>
    <TD STYLE="vertical-align: bottom; padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom; padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: black 2.25pt double; vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="border-bottom: black 2.25pt double; vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 10pt">56,752</FONT></TD>
    <TD STYLE="vertical-align: bottom; padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom; padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: black 2.25pt double; vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="border-bottom: black 2.25pt double; vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 10pt">&mdash;&nbsp;&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom; padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom; padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: black 2.25pt double; vertical-align: bottom"><FONT STYLE="font-size: 10pt">$</FONT></TD>
    <TD STYLE="border-bottom: black 2.25pt double; vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 10pt">&mdash;&nbsp;&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom; padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom; padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: black 2.25pt double; vertical-align: bottom"><FONT STYLE="font-size: 10pt">$</FONT></TD>
    <TD STYLE="border-bottom: black 2.25pt double; vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 10pt">34,678,891</FONT></TD>
    <TD STYLE="vertical-align: bottom; padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom; padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: black 2.25pt double; vertical-align: bottom"><FONT STYLE="font-size: 10pt">$</FONT></TD>
    <TD STYLE="border-bottom: black 2.25pt double; vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 10pt">(36,361,809</FONT></TD>
    <TD STYLE="vertical-align: bottom; padding-bottom: 2.5pt"><FONT STYLE="font-size: 10pt">)</FONT></TD>
    <TD STYLE="vertical-align: bottom; padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: black 2.25pt double; vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 10pt">$(1,626,167)</FONT></TD></TR>
<TR STYLE="background-color: white">
    <TD STYLE="vertical-align: top">&nbsp;</TD>
    <TD STYLE="vertical-align: top">&nbsp;</TD>
    <TD STYLE="vertical-align: top">&nbsp;</TD>
    <TD STYLE="vertical-align: top">&nbsp;</TD>
    <TD STYLE="vertical-align: top">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom; text-align: right">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom; text-align: right">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom; text-align: right">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom; text-align: right">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom; text-align: right">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom; text-align: right">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="background-color: #CCEEFF">
    <TD COLSPAN="4" STYLE="vertical-align: top"><FONT STYLE="font-size: 10pt">Issuance of warrants</FONT></TD>
    <TD STYLE="vertical-align: top">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 10pt">&mdash;&nbsp;&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 10pt">&mdash;&nbsp;&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 10pt">&mdash;&nbsp;&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 10pt">&mdash;&nbsp;&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 10pt">77,434</FONT></TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 10pt">&mdash;&nbsp;&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 10pt">77,434</FONT></TD></TR>
<TR STYLE="background-color: white">
    <TD COLSPAN="4" STYLE="vertical-align: top"><FONT STYLE="font-size: 10pt">Issuance of common stock for services</FONT></TD>
    <TD STYLE="vertical-align: top">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 10pt">&mdash;&nbsp;&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 10pt">&mdash;&nbsp;&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 10pt">&mdash;&nbsp;&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 10pt">&mdash;&nbsp;&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom; text-align: right">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 10pt">&mdash;&nbsp;&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 10pt">-</FONT></TD></TR>
<TR STYLE="background-color: #CCEEFF">
    <TD COLSPAN="4" STYLE="vertical-align: top"><FONT STYLE="font-size: 10pt">Issuance of common stock for cash</FONT></TD>
    <TD STYLE="vertical-align: top">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 10pt">249,912</FONT></TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 10pt">250</FONT></TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 10pt">&mdash;&nbsp;&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 10pt">&mdash;&nbsp;&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 10pt">142,316</FONT></TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 10pt">&mdash;&nbsp;&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 10pt">142,566</FONT></TD></TR>
<TR STYLE="background-color: white">
    <TD COLSPAN="4" STYLE="vertical-align: top"><FONT STYLE="font-size: 10pt">Net loss</FONT></TD>
    <TD STYLE="vertical-align: top; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid; vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid; vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 10pt">&mdash;&nbsp;&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid; vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid; vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 10pt">&mdash;&nbsp;&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid; vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid; vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 10pt">&mdash;&nbsp;&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid; vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid; vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 10pt">&mdash;&nbsp;&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid; vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid; vertical-align: bottom; text-align: right">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid; vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid; vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 10pt">(373,350</FONT></TD>
    <TD STYLE="vertical-align: bottom; padding-bottom: 1pt"><FONT STYLE="font-size: 10pt">)</FONT></TD>
    <TD STYLE="vertical-align: bottom; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid; vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 10pt">(373,350)</FONT></TD></TR>
<TR STYLE="background-color: #CCEEFF">
    <TD STYLE="vertical-align: top">&nbsp;</TD>
    <TD STYLE="vertical-align: top">&nbsp;</TD>
    <TD STYLE="vertical-align: top">&nbsp;</TD>
    <TD STYLE="vertical-align: top">&nbsp;</TD>
    <TD STYLE="vertical-align: top">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom; text-align: right">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom; text-align: right">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom; text-align: right">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom; text-align: right">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom; text-align: right">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom; text-align: right">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="background-color: white">
    <TD COLSPAN="4" STYLE="vertical-align: top"><FONT STYLE="font-size: 10pt"><B>Balances at June 30, 2020</B></FONT></TD>
    <TD STYLE="vertical-align: top; padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: black 2.25pt double; vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="border-bottom: black 2.25pt double; vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 10pt">57,002,254</FONT></TD>
    <TD STYLE="vertical-align: bottom; padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom; padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: black 2.25pt double; vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="border-bottom: black 2.25pt double; vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 10pt">57,002</FONT></TD>
    <TD STYLE="vertical-align: bottom; padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom; padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: black 2.25pt double; vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="border-bottom: black 2.25pt double; vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 10pt">&mdash;&nbsp;&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom; padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom; padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: black 2.25pt double; vertical-align: bottom"><FONT STYLE="font-size: 10pt">$</FONT></TD>
    <TD STYLE="border-bottom: black 2.25pt double; vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 10pt">&mdash;&nbsp;&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom; padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom; padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: black 2.25pt double; vertical-align: bottom"><FONT STYLE="font-size: 10pt">$</FONT></TD>
    <TD STYLE="border-bottom: black 2.25pt double; vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 10pt">34,898,641</FONT></TD>
    <TD STYLE="vertical-align: bottom; padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom; padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: black 2.25pt double; vertical-align: bottom"><FONT STYLE="font-size: 10pt">$</FONT></TD>
    <TD STYLE="border-bottom: black 2.25pt double; vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 10pt">(36,735,159</FONT></TD>
    <TD STYLE="vertical-align: bottom; padding-bottom: 2.5pt"><FONT STYLE="font-size: 10pt">)</FONT></TD>
    <TD STYLE="vertical-align: bottom; padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: black 2.25pt double; vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 10pt">$(1,779,517)</FONT></TD></TR>
</TABLE>
<P STYLE="font: 12pt Times New Roman, Times, Serif; margin: 0; text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; text-align: center; margin-top: 0; margin-bottom: 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">The
accompanying notes are an integral part of these condensed consolidated financial statements.</FONT></P>

<P STYLE="font: 12pt Times New Roman, Times, Serif; margin: 0; text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 12pt Times New Roman, Times, Serif; margin: 0; text-align: center"></P>

<P STYLE="font: 12pt Times New Roman, Times, Serif; margin: 0; text-align: center"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><A NAME="cashflow"></A><B>Splash
Beverage Group, Inc.</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><B>[f/k/a Canfield Medical Supply, Inc.]</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B>Condensed
Consolidated Statement Cash Flows </B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><B>For the Six Months Ended June 30, 2020 and
2019</B></P>

<P STYLE="font: 12pt Times New Roman, Times, Serif; margin: 0; text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B>(Unaudited)</B></FONT></P>

<P STYLE="font: 12pt Times New Roman, Times, Serif; margin: 0; text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B>&nbsp;</B></FONT></P>

<P STYLE="font: 12pt Times New Roman, Times, Serif; margin: 0; text-align: center"></P>





<TABLE CELLSPACING="0" CELLPADDING="0" STYLE="font: 12pt Times New Roman, Times, Serif; width: 100%; border-collapse: collapse">
<TR STYLE="vertical-align: bottom">
    <TD>&nbsp;</TD>
    <TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="3" STYLE="border-bottom: black 1pt solid; text-align: center"><FONT STYLE="font-size: 10pt"><B>Six months ended June 30, 2020</B></FONT></TD>
    <TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="3" STYLE="border-bottom: black 1pt solid; text-align: center"><FONT STYLE="font-size: 10pt"><B>Six months ended June 30, 2019</B></FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: #CCEEFF">
    <TD STYLE="width: 72%"><FONT STYLE="font-size: 10pt">Net loss</FONT></TD>
    <TD STYLE="width: 2%">&nbsp;</TD>
    <TD STYLE="width: 1%"><FONT STYLE="font-size: 10pt">$</FONT></TD>
    <TD STYLE="width: 10%; text-align: right"><FONT STYLE="font-size: 10pt">(3,822,129</FONT></TD>
    <TD STYLE="width: 1%"><FONT STYLE="font-size: 10pt">)</FONT></TD>
    <TD STYLE="width: 2%">&nbsp;</TD>
    <TD STYLE="width: 1%"><FONT STYLE="font-size: 10pt">$</FONT></TD>
    <TD STYLE="width: 10%; text-align: right"><FONT STYLE="font-size: 10pt">(1,624,364</FONT></TD>
    <TD STYLE="width: 1%"><FONT STYLE="font-size: 10pt">)</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: white">
    <TD STYLE="padding-left: 10pt"><FONT STYLE="font-size: 10pt">Adjustments to reconcile net loss to net cash</FONT></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">&nbsp;</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: #CCEEFF">
    <TD STYLE="padding-left: 20pt"><FONT STYLE="font-size: 10pt">used in operating activities:</FONT></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">&nbsp;</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: white">
    <TD STYLE="padding-left: 30pt"><FONT STYLE="font-size: 10pt">Depreciation and amortization</FONT></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">13,045</FONT></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">4,711</FONT></TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: #CCEEFF">
    <TD STYLE="padding-left: 30pt"><FONT STYLE="font-size: 10pt">Amortization of ROU Asset</FONT></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">39,684</FONT></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">502</FONT></TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: white">
    <TD STYLE="padding-left: 30pt"><FONT STYLE="font-size: 10pt">Debt discount</FONT></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">(5,222</FONT></TD>
    <TD><FONT STYLE="font-size: 10pt">)</FONT></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">&nbsp;</TD>
    <TD><FONT STYLE="font-size: 10pt">_</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: #CCEEFF">
    <TD STYLE="padding-left: 30pt"><FONT STYLE="font-size: 10pt">Gain from debt extinguishment</FONT></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">(34,962</FONT></TD>
    <TD><FONT STYLE="font-size: 10pt">)</FONT></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">&mdash;&nbsp;&nbsp;</FONT></TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: white">
    <TD STYLE="padding-left: 30pt"><FONT STYLE="font-size: 10pt">Interest on notes payable converted to common stock</FONT></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">231,692</FONT></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">&mdash;&nbsp;&nbsp;</FONT></TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: #CCEEFF">
    <TD STYLE="padding-left: 30pt"><FONT STYLE="font-size: 10pt">Interest expense due to the issuance of warrants</FONT></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">1,657,805</FONT></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">&mdash;&nbsp;&nbsp;</FONT></TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: white">
    <TD STYLE="padding-left: 30pt"><FONT STYLE="font-size: 10pt">Share-based compensation</FONT></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">&mdash;&nbsp;&nbsp;</FONT></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">&mdash;&nbsp;&nbsp;</FONT></TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: #CCEEFF">
    <TD STYLE="padding-left: 30pt"><FONT STYLE="font-size: 10pt">Shares issued in exchange for services</FONT></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">600,000</FONT></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">1,000</FONT></TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: white">
    <TD STYLE="padding-left: 30pt"><FONT STYLE="font-size: 10pt">Other noncash charges</FONT></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">(252,280</FONT></TD>
    <TD><FONT STYLE="font-size: 10pt">)</FONT></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">&mdash;&nbsp;&nbsp;</FONT></TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: #CCEEFF">
    <TD STYLE="padding-left: 10pt"><FONT STYLE="font-size: 10pt">Changes in working capital items:</FONT></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">&mdash;&nbsp;&nbsp;</FONT></TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: white">
    <TD STYLE="padding-left: 30pt"><FONT STYLE="font-size: 10pt">Accounts receivable</FONT></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">(36,641</FONT></TD>
    <TD><FONT STYLE="font-size: 10pt">)</FONT></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">2,598</FONT></TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: #CCEEFF">
    <TD STYLE="padding-left: 30pt"><FONT STYLE="font-size: 10pt">Inventory</FONT></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">(153,804</FONT></TD>
    <TD><FONT STYLE="font-size: 10pt">)</FONT></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">(80,648</FONT></TD>
    <TD><FONT STYLE="font-size: 10pt">)</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: white">
    <TD STYLE="padding-left: 30pt"><FONT STYLE="font-size: 10pt">Prepaid expenses and other current assets</FONT></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">(16,077</FONT></TD>
    <TD><FONT STYLE="font-size: 10pt">)</FONT></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">38,187</FONT></TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: #CCEEFF">
    <TD STYLE="padding-left: 30pt"><FONT STYLE="font-size: 10pt">Deposits</FONT></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">(39,451</FONT></TD>
    <TD><FONT STYLE="font-size: 10pt">)</FONT></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">(1,043</FONT></TD>
    <TD><FONT STYLE="font-size: 10pt">)</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: white">
    <TD STYLE="padding-left: 30pt"><FONT STYLE="font-size: 10pt">Accounts payable and accrued expenses</FONT></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">(56,268</FONT></TD>
    <TD><FONT STYLE="font-size: 10pt">)</FONT></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">(122,896</FONT></TD>
    <TD><FONT STYLE="font-size: 10pt">)</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: #CCEEFF">
    <TD STYLE="padding-left: 30pt"><FONT STYLE="font-size: 10pt">Royalty payable</FONT></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">51,000</FONT></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">(21,062</FONT></TD>
    <TD><FONT STYLE="font-size: 10pt">)</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: white">
    <TD STYLE="padding-bottom: 1pt; padding-left: 30pt"><FONT STYLE="font-size: 10pt">Accrued Interest payable</FONT></TD>
    <TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid; text-align: right"><FONT STYLE="font-size: 10pt">40,601</FONT></TD>
    <TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid; text-align: right"><FONT STYLE="font-size: 10pt">403,530</FONT></TD>
    <TD STYLE="padding-bottom: 1pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: #CCEEFF">
    <TD STYLE="padding-bottom: 1pt"><FONT STYLE="font-size: 10pt">Net cash used in operating activities</FONT></TD>
    <TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid; text-align: right"><FONT STYLE="font-size: 10pt">(1,783,007</FONT></TD>
    <TD STYLE="padding-bottom: 1pt"><FONT STYLE="font-size: 10pt">)</FONT></TD>
    <TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid; text-align: right"><FONT STYLE="font-size: 10pt">(1,399,485</FONT></TD>
    <TD STYLE="padding-bottom: 1pt"><FONT STYLE="font-size: 10pt">)</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: white">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">&nbsp;</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: #CCEEFF">
    <TD><FONT STYLE="font-size: 10pt">Cash Flows from Investing Activities:</FONT></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">&nbsp;</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: white">
    <TD STYLE="padding-left: 10pt"><FONT STYLE="font-size: 10pt">Capital Expenditures</FONT></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">(5,439</FONT></TD>
    <TD><FONT STYLE="font-size: 10pt">)</FONT></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">(4,526</FONT></TD>
    <TD><FONT STYLE="font-size: 10pt">)</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: #CCEEFF">
    <TD STYLE="padding-left: 10pt"><FONT STYLE="font-size: 10pt">Proceeds from sale of fixed assets</FONT></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">1,098</FONT></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">&nbsp;</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: white">
    <TD STYLE="padding-left: 10pt"><FONT STYLE="font-size: 10pt">Investment in Salt Tequila USA, LLC</FONT></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">(150,000</FONT></TD>
    <TD><FONT STYLE="font-size: 10pt">)</FONT></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">&mdash;&nbsp;&nbsp;</FONT></TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: #CCEEFF">
    <TD STYLE="padding-bottom: 1pt; padding-left: 10pt"><FONT STYLE="font-size: 10pt">Net cash acquired in merger</FONT></TD>
    <TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid; text-align: right"><FONT STYLE="font-size: 10pt">72,442</FONT></TD>
    <TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid; text-align: right"><FONT STYLE="font-size: 10pt">&mdash;&nbsp;&nbsp;</FONT></TD>
    <TD STYLE="padding-bottom: 1pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: white">
    <TD STYLE="padding-bottom: 1pt"><FONT STYLE="font-size: 10pt">Net cash used in investing activities</FONT></TD>
    <TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid; text-align: right"><FONT STYLE="font-size: 10pt">(81,899</FONT></TD>
    <TD STYLE="padding-bottom: 1pt"><FONT STYLE="font-size: 10pt">)</FONT></TD>
    <TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid; text-align: right"><FONT STYLE="font-size: 10pt">(4,526</FONT></TD>
    <TD STYLE="padding-bottom: 1pt"><FONT STYLE="font-size: 10pt">)</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: #CCEEFF">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">&nbsp;</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: white">
    <TD><FONT STYLE="font-size: 10pt">Cash Flows from Financing Activities:</FONT></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">&nbsp;</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: #CCEEFF">
    <TD STYLE="padding-left: 10pt"><FONT STYLE="font-size: 10pt">Proceeds from issuance of Common stock</FONT></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">1,610,000</FONT></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">375,000</FONT></TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: white">
    <TD STYLE="padding-left: 10pt"><FONT STYLE="font-size: 10pt">Repayment of shareholder advance</FONT></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">(120,106</FONT></TD>
    <TD><FONT STYLE="font-size: 10pt">)</FONT></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">&mdash;&nbsp;&nbsp;</FONT></TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: #CCEEFF">
    <TD STYLE="padding-left: 10pt"><FONT STYLE="font-size: 10pt">Cash advance from shareholder</FONT></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">288,000</FONT></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">&mdash;&nbsp;&nbsp;</FONT></TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: white">
    <TD STYLE="padding-left: 10pt"><FONT STYLE="font-size: 10pt">Proceeds from issuance of debt</FONT></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">264,249</FONT></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">160,413</FONT></TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: #CCEEFF">
    <TD STYLE="padding-left: 10pt"><FONT STYLE="font-size: 10pt">Principal repayment of debt</FONT></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">(61,248</FONT></TD>
    <TD><FONT STYLE="font-size: 10pt">)</FONT></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">&mdash;&nbsp;&nbsp;</FONT></TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: white">
    <TD STYLE="padding-bottom: 1pt; padding-left: 10pt"><FONT STYLE="font-size: 10pt">Reduction of ROU Liability</FONT></TD>
    <TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid; text-align: right"><FONT STYLE="font-size: 10pt">(39,877</FONT></TD>
    <TD STYLE="padding-bottom: 1pt"><FONT STYLE="font-size: 10pt">)</FONT></TD>
    <TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid; text-align: right"><FONT STYLE="font-size: 10pt">&mdash;&nbsp;&nbsp;</FONT></TD>
    <TD STYLE="padding-bottom: 1pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: #CCEEFF">
    <TD STYLE="padding-bottom: 1pt"><FONT STYLE="font-size: 10pt">Net cash provided by financing activities</FONT></TD>
    <TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid; text-align: right"><FONT STYLE="font-size: 10pt">1,941,018</FONT></TD>
    <TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid; text-align: right"><FONT STYLE="font-size: 10pt">535,413</FONT></TD>
    <TD STYLE="padding-bottom: 1pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: white">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">&nbsp;</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: #CCEEFF">
    <TD><FONT STYLE="font-size: 10pt">Net Change in Cash and Cash Equivalents</FONT></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">76,112</FONT></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">(868,598</FONT></TD>
    <TD><FONT STYLE="font-size: 10pt">)</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: white">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">&nbsp;</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: #CCEEFF">
    <TD STYLE="padding-bottom: 1pt"><FONT STYLE="font-size: 10pt">Cash and Cash Equivalents, beginning of year</FONT></TD>
    <TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid; text-align: right"><FONT STYLE="font-size: 10pt">42,639</FONT></TD>
    <TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid; text-align: right"><FONT STYLE="font-size: 10pt">938,040</FONT></TD>
    <TD STYLE="padding-bottom: 1pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: white">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">&nbsp;</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: #CCEEFF">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">&nbsp;</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: white">
    <TD STYLE="padding-bottom: 2.5pt"><FONT STYLE="font-size: 10pt">Cash and Cash Equivalents, end of period</FONT></TD>
    <TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: black 2.25pt double"><FONT STYLE="font-size: 10pt">$</FONT></TD>
    <TD STYLE="border-bottom: black 2.25pt double; text-align: right"><FONT STYLE="font-size: 10pt">118,751</FONT></TD>
    <TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: black 2.25pt double"><FONT STYLE="font-size: 10pt">$</FONT></TD>
    <TD STYLE="border-bottom: black 2.25pt double; text-align: right"><FONT STYLE="font-size: 10pt">69,442</FONT></TD>
    <TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: #CCEEFF">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">&nbsp;</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: white">
    <TD><FONT STYLE="font-size: 10pt"><B><U>Supplemental Disclosure of Cash Flow Information:</U></B></FONT></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">&nbsp;</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: #CCEEFF">
    <TD STYLE="padding-bottom: 2.5pt; padding-left: 30pt"><FONT STYLE="font-size: 10pt">Cash paid for interest</FONT></TD>
    <TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: black 2.25pt double"><FONT STYLE="font-size: 10pt">$</FONT></TD>
    <TD STYLE="border-bottom: black 2.25pt double; text-align: right"><FONT STYLE="font-size: 10pt">3,424</FONT></TD>
    <TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: black 2.25pt double"><FONT STYLE="font-size: 10pt">$</FONT></TD>
    <TD STYLE="border-bottom: black 2.25pt double; text-align: right"><FONT STYLE="font-size: 10pt">&mdash;&nbsp;&nbsp;</FONT></TD>
    <TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: white">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">&nbsp;</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: #CCEEFF">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">&nbsp;</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: white">
    <TD><FONT STYLE="font-size: 10pt"><B><U>Supplemental Disclosure of Non-Cash Investing and Financing Activities</U></B></FONT></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">&nbsp;</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: #CCEEFF">
    <TD STYLE="padding-left: 30pt"><FONT STYLE="font-size: 10pt">Notes payable and accrued interest converted to common stock (12,605,283 shares)</FONT></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">9,248,721</FONT></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">&mdash;&nbsp;&nbsp;</FONT></TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: white">
    <TD STYLE="padding-left: 30pt"><FONT STYLE="font-size: 10pt">Series A &amp; B preferred stock and declared dividends converted to common stock</FONT></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">14,587,623</FONT></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">&mdash;&nbsp;&nbsp;</FONT></TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: #CCEEFF">
    <TD STYLE="padding-bottom: 2.5pt; padding-left: 30pt"><FONT STYLE="font-size: 10pt">Liability issued for investment in SALT Tequila USA, LLC</FONT></TD>
    <TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: black 2.25pt double">&nbsp;</TD>
    <TD STYLE="border-bottom: black 2.25pt double; text-align: right"><FONT STYLE="font-size: 10pt">100,000</FONT></TD>
    <TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: black 2.25pt double">&nbsp;</TD>
    <TD STYLE="border-bottom: black 2.25pt double; text-align: right"><FONT STYLE="font-size: 10pt">&mdash;&nbsp;&#8239;</FONT></TD>
    <TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD></TR>
</TABLE>
<P STYLE="font: 12pt Times New Roman, Times, Serif; margin: 0; text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">The
accompanying notes are an integral part of these condensed consolidated financial statements.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><B>Splash Beverage Group, Inc.</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><B>[f/k/a Canfield Medical Supply, Inc.]</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B>Notes
to the Condensed Consolidated Financial Statements</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><A NAME="notes"></A><B><U>Note
1 &ndash; Business Organization and Nature of Operations</U></B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 1in; text-align: justify; text-indent: -1in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif; text-transform: uppercase"><B>&nbsp;&nbsp;</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">Splash Beverage Group (&ldquo;SBG&rdquo;),
f/k/a Canfield Medical Supply, Inc. (the &ldquo;CMS&rdquo;), was incorporated in the State of Ohio on September 3, 1992, and changed
domicile to Colorado on April 18, 2012. CMS is in the business of home health services, primarily the selling of durable medical
equipment and medical supplies to the public, nursing homes, hospitals and other end users.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">On December 31, 2019, CMS entered into an
Agreement and Plan of Merger (the &ldquo;Merger Agreement&rdquo;) with SBG Acquisition Inc. (&ldquo;Merger Sub&rdquo;), a Nevada
Corporation wholly-owned by CMS, and Splash Beverage Group, Inc. a Nevada corporation (&ldquo;Splash&rdquo;) pursuant to which
Merger Sub merged with and into Splash (the &ldquo;Merger&rdquo;) with Splash as the surviving company and a wholly-owned subsidiary
of CMS. The Merger was consummated on March 31, 2020.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">As the owners and management of Splash have
voting and operating control of CMS following the Merger, the Merger transaction was accounted for as a reverse acquisition (that
is with Splash as the acquiring entity), followed by a recapitalization.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">As part of the recapitalization, previously
issued shares of SBG preferred stock have been reflected as shares of common stock that were received in the Merger. These common
shares have been retrospectively presented as outstanding for all periods.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">Splash specializes in the manufacturing, distribution,
and sales &amp; marketing of various beverages across multiple channels. Splash operates in both the non-alcoholic and alcoholic
beverage segments. Additionally, Splash operates its own vertically integrated B-to-B and B-to-C e-commerce distribution platform
called Qplash, further expanding its distribution abilities and visibility.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">On July 2, 2020, CMS received a Certificate
of Good Standing from the State of Colorado. This certificate allowed us to change our name from Canfield Medical Supply, Inc.
to Splash Beverage Group, Inc. a Colorado company. On July 31, 2020, we received approval from FINRA to change the Company&rsquo;s
name from Canfield Medical Supply, Inc. to Splash Beverage Group, Inc.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><B>&nbsp;</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 1in; text-align: justify; text-indent: -1in"><B><U>Note 2 &ndash;
Summary of Significant Accounting Policies </U></B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><B><I><U>Basis of Presentation and Consolidation</U></I></B></P>

<P STYLE="font: 12pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><FONT STYLE="font-size: 10pt">These condensed
consolidated financial statements include the accounts of Splash Beverage Group and its wholly owned subsidiaries, Holdings and
Splash Mex, in addition to the accounts of the CMS from March 31, 2020, the merger consummation date. All intercompany balances
have been eliminated in consolidation.</FONT><FONT STYLE="font-size: 8pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">Our accounting and reporting policies conform
to accounting principles generally accepted in the United States of America (GAAP).</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">The accompanying financial statements have
been prepared by us without audit. In the opinion of management, all adjustments (which include only normal recurring adjustments)
necessary to present fairly the financial position, results of operations and cash flows for the three months ended June 30, 2020
and 2019 have been made.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">Certain information and footnote disclosures
normally included in financial statements prepared in accordance with accounting principles generally accepted in the United States
of America have been condensed or omitted. It is suggested that these financial statements be read in conjunction with the consolidated
financial statements and notes thereto included in our December 31, 2019 audited financial statements. The results of operations
for the period ended June 30, 2020 are not necessarily indicative of the operating results for the full year.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><B><I><U>Use of Estimates</U></I></B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">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 disclosures of contingent assets and liabilities at the date of the financial statements and the reported amounts
of revenues and expenses during the reporting period. Actual results could differ from those estimates.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><B><I><U>Cash Equivalents and Concentration
of Cash Balance</U></I></B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">We consider all highly liquid securities with
an original maturity of three months or less to be cash equivalents. We had no cash equivalents at June 30, 2020 or December 31,
2019.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">Our cash in bank deposit accounts, at times,
may exceed federally insured limits of $250,000. At June 30, 2020 we had no bank accounts over the federally insured limits. Our
bank deposit accounts in Mexico are uninsured.</P>


<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">&nbsp;</P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><B>Splash Beverage Group, Inc.</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><B>[f/k/a Canfield Medical Supply, Inc.]</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B>Notes
to the Condensed Consolidated Financial Statements</B></FONT></P>


<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B><U>Note
2 &ndash; Summary of Significant Accounting Policies, continued</U></B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B><I><U>Accounts
Receivable and Allowance for Doubtful Accounts</U></I></B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"></P>

<P STYLE="font: 12pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><FONT STYLE="font-size: 10pt">Accounts receivable
are carried at their estimated collectible amounts and are periodically evaluated for collectability based on past credit history
with clients and other factors. We establish provisions for losses on accounts receivable on the basis of loss experience, known
and inherent risk in the account balance, and current economic conditions.&nbsp; At June 30, 2020 and December 31, 2019, our accounts
receivable amounts are reflected net of allowances of</FONT><FONT STYLE="font-size: 8pt">&nbsp;</FONT><FONT STYLE="font-size: 10pt">$359,657
and $11,430, respectively.</FONT></P>


<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B><I><U>Inventory</U></I></B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">Inventory
is stated at the lower of cost or net realizable value, accounted for using the weighted average cost method. The inventory balances
at June 30, 2020 and December 31, 2019 consisted of finished goods held for distribution. The cost elements of inventory consist
of purchase of products, transportation, and warehousing. We establish provisions for excess or inventory near expiration are
based on management&rsquo;s estimates of forecast turnover of inventories on hand and under contract. A significant change in
the timing or level of demand for certain products as compared to forecast amounts may result in recording additional provisions
for excess or expired inventory in the future. Provisions for excess inventory are included in cost of goods sold and have historically
been adequate to provide for losses on inventory.&nbsp;We manage inventory levels and purchase commitments in an effort to maximize
utilization of inventory on hand and under commitments.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B><I><U>Property
and Equipment</U></I></B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">We
record property and equipment at cost when purchased. Depreciation is recorded for property, equipment, and software using the
straight-line method over the estimated economic useful lives of assets, which range from 3-10 years. Company management reviews
the recoverability of all long-lived assets, including the related useful lives, whenever events or changes in circumstances indicate
that the carrying amount of a long-lived asset might not be recoverable.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"></P>

<P STYLE="font: 12pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><FONT STYLE="font-size: 10pt">Depreciation
expense totaled $10,750 and</FONT><FONT STYLE="font-size: 8pt">&nbsp;&nbsp;</FONT> <FONT STYLE="font-size: 10pt">$1,806 for the
three months ended June 30, 2020 and June 30, 2019, respectively. Depreciation expense totaled $13,045 and $4,711 for the six
months ended June 30, 2020 and June 30, 2019, respectively. Property and equipment as of June 30, 2020 and December 31, 2019 consisted
of the following:</FONT></P>


<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: 10pt Times New Roman, Times, Serif; border-collapse: collapse; width: 100%">
<TR STYLE="vertical-align: bottom">
    <TD STYLE="text-align: center"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font-weight: bold; padding-bottom: 1pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD COLSPAN="3" STYLE="border-bottom: Black 1pt solid; font-weight: bold; text-align: center"><FONT STYLE="font-size: 10pt">June&nbsp;30,<BR>
    2020</FONT></TD><TD STYLE="font-weight: bold; padding-bottom: 1pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD COLSPAN="3" STYLE="border-bottom: Black 1pt solid; font-weight: bold; text-align: center"><FONT STYLE="font-size: 10pt">December&nbsp;31,<BR>
    2019</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="width: 56%; text-align: left"><FONT STYLE="font-size: 10pt">Property and equipment, at cost</FONT></TD><TD STYLE="width: 8%"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="width: 1%; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="width: 12%; text-align: right"><FONT STYLE="font-size: 10pt">206,006</FONT></TD><TD STYLE="width: 1%; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="width: 8%"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="width: 1%; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="width: 12%; text-align: right"><FONT STYLE="font-size: 10pt">88,758</FONT></TD><TD STYLE="width: 1%; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; padding-bottom: 1pt"><FONT STYLE="font-size: 10pt">Accumulated depreciation</FONT></TD><TD STYLE="padding-bottom: 1pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right"><FONT STYLE="font-size: 10pt">(141,738</FONT></TD><TD STYLE="padding-bottom: 1pt; text-align: left"><FONT STYLE="font-size: 10pt">)</FONT></TD><TD STYLE="padding-bottom: 1pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right"><FONT STYLE="font-size: 10pt">(51,029</FONT></TD><TD STYLE="padding-bottom: 1pt; text-align: left"><FONT STYLE="font-size: 10pt">)</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="text-align: left; padding-bottom: 2.5pt"><FONT STYLE="font-size: 10pt">Property and equipment, net</FONT></TD><TD STYLE="padding-bottom: 2.5pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="border-bottom: Black 2.5pt double; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="border-bottom: Black 2.5pt double; text-align: right"><FONT STYLE="font-size: 10pt">64,269</FONT></TD><TD STYLE="padding-bottom: 2.5pt; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="padding-bottom: 2.5pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="border-bottom: Black 2.5pt double; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="border-bottom: Black 2.5pt double; text-align: right"><FONT STYLE="font-size: 10pt">37,729</FONT></TD><TD STYLE="padding-bottom: 2.5pt; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD></TR>
</TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B><I><U>Licensing
Agreements</U></I></B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">We
capitalize the costs for our licensing agreements with ABG TapouT, LLC and Salt Tequila USA, LLC, which are amortized to expense
on a straight-line basis over the term of the agreements.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">The
initial amount of the TapouT agreement as entered into by a related party prior to the Company&rsquo;s assumption in 2013 was
$4,000,000 to be paid over several years pursuant to a guaranteed minimum royalty agreement. Royalty costs incurred under the
agreements, guaranteed minimum royalty amounts, are expensed as incurred.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">We
have not made any payments to Salt Tequila USA, LLC under the licensing agreement due to the immaterial level of our sales to
date from the brand.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><B>Splash Beverage Group, Inc.</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><B>[f/k/a Canfield Medical Supply, Inc.]</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B>Notes
to the Condensed Consolidated Financial Statements</B></FONT></P>


<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B><U>Note
2 &ndash; Summary of Significant Accounting Policies, continued</U></B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B><I><U>Fair
Value of Financial Instruments </U></I></B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">Financial
Accounting Standards (&ldquo;FASB&rdquo;) guidance specifies a hierarchy of valuation techniques based on whether the inputs to
those valuation techniques are observable or unobservable. Observable inputs reflect market data obtained from independent sources,
while unobservable inputs reflect market assumptions. The hierarchy gives the highest priority to unadjusted quoted prices in
active markets for identical assets or liabilities (Level 1 measurement) and the lowest priority to unobservable inputs (Level
3 measurement). The three levels of the fair value hierarchy are as follows:</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B><I>&nbsp;</I></B></FONT></P>

<TABLE CELLSPACING="0" CELLPADDING="0" STYLE="font: 12pt Times New Roman, Times, Serif; width: 100%">
<TR STYLE="vertical-align: top">
    <TD STYLE="width: 5%; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD>
    <TD STYLE="white-space: nowrap; width: 6%"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">Level
    1 -&nbsp;</FONT></TD>
    <TD STYLE="width: 89%; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">Unadjusted
    quoted prices in active markets for identical assets or liabilities that the reporting entity has the ability to access at
    the measurement date. Level 1 primarily consists of financial instruments whose value is based on quoted market prices such
    as exchange-traded instruments and listed equities.</FONT></TD></TR>
</TABLE>
<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 1in; text-align: justify; text-indent: -0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<TABLE CELLSPACING="0" CELLPADDING="0" STYLE="font: 12pt Times New Roman, Times, Serif; width: 100%">
<TR STYLE="vertical-align: top">
    <TD STYLE="width: 5%; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD>
    <TD STYLE="white-space: nowrap; width: 6%"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">Level
    2 -&nbsp;</FONT></TD>
    <TD STYLE="width: 89%; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">Inputs
    other than quoted prices included within Level 1 that are observable for the asset or liability, either directly or indirectly
    (e.g., quoted prices of similar assets or liabilities in active markets, or quoted prices for identical or similar assets
    or liabilities in markets that are not active).</FONT></TD></TR>
</TABLE>
<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.25in; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<TABLE CELLSPACING="0" CELLPADDING="0" STYLE="font: 12pt Times New Roman, Times, Serif; width: 100%">
<TR STYLE="vertical-align: top">
    <TD STYLE="width: 5%; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD>
    <TD STYLE="white-space: nowrap; width: 6%"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">Level
    3 -&nbsp; </FONT></TD>
    <TD STYLE="width: 89%; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">Unobservable
    inputs for the asset or liability. Financial instruments are considered Level 3 when their fair values are determined using
    pricing models, discounted cash flows or similar techniques and at least one significant model assumption or input is unobservable.</FONT></TD></TR>
</TABLE>
<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">The
liabilities and indebtedness presented on the consolidated financial statements approximate fair values at June 30, 2020 and December
31, 2019, consistent with recent negotiations of notes payable and due to the short duration of maturities.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B><I><U>Convertible
Instruments</U></I></B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; background-color: white"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">U.S.
GAAP requires the bifurcation of certain conversion rights contained in convertible indebtedness and account for them as free
standing derivative financial instruments according to certain criteria. This criteria include circumstances in which (a)&nbsp;the
economic characteristics and risks of the embedded derivative instrument are not clearly and closely related to the economic characteristics
and risks of the host contract, (b)&nbsp;the hybrid instrument that embodies both the embedded derivative instrument and the host
contract is not re-measured at fair value under otherwise applicable generally accepted accounting principles with changes in
fair value reported in earnings as they occur and (c)&nbsp;a separate instrument with the same terms as the embedded derivative
instrument would be considered a derivative instrument. An exception to this rule is when the host instrument is deemed to be
conventional as that term is described under applicable U.S. GAAP.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; background-color: white"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; background-color: white"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">When
bifurcation is required, the embedded conversion options are bifurcated from the convertible note, resulting in the recognition
of discounts to convertible notes for the intrinsic value of conversion options embedded in debt instruments based upon the differences
between the fair value of the underlying common stock at the commitment date of the note transaction and the effective conversion
price embedded in the note.&nbsp; Debt discounts under these arrangements are amortized over the term of the related debt to their
stated date of redemption.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; background-color: white"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; background-color: white"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">With
respect to convertible preferred stock, we record a dividend for the intrinsic value of conversion options embedded in preferred
securities based upon the differences between the fair value of the underlying common stock at the commitment date of the transaction
and the effective conversion price embedded in the preferred shares.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; background-color: white"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; background-color: white"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><B>Splash Beverage Group, Inc.</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><B>[f/k/a Canfield Medical Supply, Inc.]</B></P>
<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B>Notes
to the Condensed Consolidated Financial Statements</B></FONT></P>


<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; background-color: white"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 1in; text-align: justify; text-indent: -1in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B><U>Note
2 &ndash; Summary of Significant Accounting Policies, continued</U></B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; background-color: white"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B><I><U>Revenue
Recognition</U></I></B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">We
recognize revenue under ASC 606, Revenue from Contracts with Customers (Topic 606). This guidance sets forth a five-step model
which depicts the recognition of revenue in an amount that reflects what we expect to receive in exchange for the transfer of
goods or services to customers.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">We
recognize revenue when our performance obligations under the terms of a contract with the customer are satisfied. Product sales
occur once control of our products is transferred upon delivery to the customer. Revenue is measured as the amount of consideration
that we expect to receive in exchange for transferring goods and is presented net of provisions for customer returns and allowances.
The amount of consideration we receive and revenue we recognize varies with changes in customer incentives we offer to our customers
and their customers. Sales taxes and other similar taxes are excluded from revenue.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">Distribution
expenses to transport our products, where applicable, and warehousing expense after manufacture are accounted for within operating
expenses.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B><I><U>Cost
of Goods Sold</U></I></B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">Cost
of goods sold include the costs of products, packaging, transportation, warehousing, and costs associated with valuation allowances
for expired, damaged or impaired inventory.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B><I><U>Stock-Based
Compensation</U></I></B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">We
account for stock-based compensation in accordance with ASC 718,&nbsp;&ldquo;<I>Compensation - Stock Compensation&rdquo;</I>.&nbsp;&nbsp;Under
the fair value recognition provisions, cost is measured at the grant date based on the fair value of the award and is recognized
as expense ratably over the requisite service period, which is generally the option vesting period.&nbsp;&nbsp;We use the Black-Scholes
option pricing model to determine the fair value of stock options.&nbsp;&nbsp;We early adopted ASU 2018-07, &ldquo;Improvements
to Nonemployee Share-Based Payment Accounting&rdquo;, which aligns accounting treatment for such awards to non-employees with
the existing guidance on employee share-based compensation in ASC 718.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B><I><U>Income
Taxes</U></I></B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">We
use the liability method of accounting for income taxes as set forth in ASC 740,&nbsp;&ldquo;<I>Income Taxes&rdquo;</I>.&nbsp;&nbsp;Under
the liability method, deferred taxes are determined based on the temporary differences between the financial statement and tax
basis of assets and liabilities using tax rates expected to be in effect during the years in which the basis differences reverse.&nbsp;&nbsp;We
record a valuation allowance when it is not more likely than not that the deferred tax assets will be realized.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">Company
management assesses its income tax positions and records tax benefits for all years subject to examination based upon its evaluation
of the facts, circumstances and information available at the reporting date.&nbsp;&nbsp;In accordance with ASC 740-10, for those
tax positions where there is a greater than 50% likelihood that a tax benefit will be sustained, our policy is to record the largest
amount of tax benefit that is more likely than not to be realized upon ultimate settlement with a taxing authority that has full
knowledge of all relevant information.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">For
those income tax positions where there is less than 50% likelihood that a tax benefit will be sustained, no tax benefit will be
recognized in the financial statements. Company management has determined that there are no material uncertain tax positions at
June 30, 2020 and December 31, 2019.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><B>Splash Beverage Group, Inc.</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><B>[f/k/a Canfield Medical Supply, Inc.]</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B>Notes
to the Condensed Consolidated Financial Statements</B></FONT></P>


<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B><U>Note
2 &ndash; Summary of Significant Accounting Policies, continued</U></B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; background-color: white"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B><I><U>Net
loss per share</U></I></B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">The
net loss per share is computed by dividing the net loss by the weighted average number of shares of common outstanding. Warrants,
stock options, and common stock issuable upon the conversion of the Company's convertible debt or preferred stock (if any), are
not included in the computation if the effect would be anti-dilutive.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"></P>



<TABLE CELLSPACING="0" CELLPADDING="0" STYLE="font: 12pt Times New Roman, Times, Serif; width: 100%; border-collapse: collapse">
<TR STYLE="vertical-align: bottom">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD COLSPAN="3" STYLE="text-align: center"><FONT STYLE="font-size: 10pt"><B>Three-months ended</B></FONT></TD>
    <TD>&nbsp;</TD>
    <TD COLSPAN="3" STYLE="text-align: center"><FONT STYLE="font-size: 10pt"><B>Three-months ended</B></FONT></TD>
    <TD>&nbsp;</TD>
    <TD COLSPAN="3" STYLE="text-align: center"><FONT STYLE="font-size: 10pt"><B>Six-months ended</B></FONT></TD>
    <TD>&nbsp;</TD>
    <TD COLSPAN="3" STYLE="text-align: center"><FONT STYLE="font-size: 10pt"><B>Six-months ended</B></FONT></TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD STYLE="border-bottom: black 1pt solid"><FONT STYLE="font-size: 10pt"><B>Numerator</B></FONT></TD>
    <TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="3" STYLE="border-bottom: black 1pt solid; text-align: center"><FONT STYLE="font-size: 10pt"><B>June 30, 2020</B></FONT></TD>
    <TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="3" STYLE="border-bottom: black 1pt solid; text-align: center"><FONT STYLE="font-size: 10pt"><B>June 30, 2019</B></FONT></TD>
    <TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="3" STYLE="border-bottom: black 1pt solid; white-space: nowrap; text-align: center"><FONT STYLE="font-size: 10pt"><B>June 30 2020</B></FONT></TD>
    <TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="3" STYLE="border-bottom: black 1pt solid; white-space: nowrap; text-align: center"><FONT STYLE="font-size: 10pt"><B>June 30, 2019&nbsp;</B></FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: #CCEEFF">
    <TD STYLE="width: 52%; text-indent: 10pt"><FONT STYLE="font-size: 10pt">Net loss applicable to common shareholders</FONT></TD>
    <TD STYLE="width: 1%">&nbsp;</TD>
    <TD STYLE="width: 1%"><FONT STYLE="font-size: 10pt">$</FONT></TD>
    <TD STYLE="width: 9%; text-align: right"><FONT STYLE="font-size: 10pt">(373,350</FONT></TD>
    <TD STYLE="width: 1%"><FONT STYLE="font-size: 10pt">)</FONT></TD>
    <TD STYLE="width: 1%">&nbsp;</TD>
    <TD STYLE="width: 1%"><FONT STYLE="font-size: 10pt">$</FONT></TD>
    <TD STYLE="width: 9%; text-align: right"><FONT STYLE="font-size: 10pt">(218,389</FONT></TD>
    <TD STYLE="width: 1%"><FONT STYLE="font-size: 10pt">)</FONT></TD>
    <TD STYLE="width: 1%">&nbsp;</TD>
    <TD STYLE="width: 1%"><FONT STYLE="font-size: 10pt">$</FONT></TD>
    <TD STYLE="width: 9%; text-align: right"><FONT STYLE="font-size: 10pt">(3,822,129</FONT></TD>
    <TD STYLE="width: 1%"><FONT STYLE="font-size: 10pt">)</FONT></TD>
    <TD STYLE="width: 1%">&nbsp;</TD>
    <TD STYLE="width: 1%"><FONT STYLE="font-size: 10pt">$</FONT></TD>
    <TD STYLE="width: 9%; text-align: right"><FONT STYLE="font-size: 10pt">(1,624,364</FONT></TD>
    <TD STYLE="width: 1%"><FONT STYLE="font-size: 10pt">)</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: white">
    <TD STYLE="text-align: right">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">&nbsp;</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: #CCEEFF">
    <TD><FONT STYLE="font-size: 10pt"><B>Denominator</B></FONT></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">&nbsp;</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: white">
    <TD STYLE="padding-bottom: 2.5pt; text-indent: 10pt"><FONT STYLE="font-size: 10pt">Weighted average number of common shares outstanding</FONT></TD>
    <TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: black 2.25pt double">&nbsp;</TD>
    <TD STYLE="border-bottom: black 2.25pt double; text-align: right"><FONT STYLE="font-size: 10pt">56,908,703</FONT></TD>
    <TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: black 2.25pt double">&nbsp;</TD>
    <TD STYLE="border-bottom: black 2.25pt double; text-align: right"><FONT STYLE="font-size: 10pt">41,807,563</FONT></TD>
    <TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: black 2.25pt double">&nbsp;</TD>
    <TD STYLE="border-bottom: black 2.25pt double; text-align: right"><FONT STYLE="font-size: 10pt">51,113,403</FONT></TD>
    <TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: black 2.25pt double">&nbsp;</TD>
    <TD STYLE="border-bottom: black 2.25pt double; text-align: right"><FONT STYLE="font-size: 10pt">41,603,563</FONT></TD>
    <TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: #CCEEFF">
    <TD STYLE="text-align: right">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">&nbsp;</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: white">
    <TD STYLE="padding-bottom: 2.5pt; text-indent: 10pt"><FONT STYLE="font-size: 10pt">Net loss per share (basic and diluted)</FONT></TD>
    <TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: black 2.25pt double"><FONT STYLE="font-size: 10pt">$</FONT></TD>
    <TD STYLE="border-bottom: black 2.25pt double; text-align: right"><FONT STYLE="font-size: 10pt">(0.01</FONT></TD>
    <TD STYLE="padding-bottom: 2.5pt"><FONT STYLE="font-size: 10pt">)</FONT></TD>
    <TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: black 2.25pt double"><FONT STYLE="font-size: 10pt">$</FONT></TD>
    <TD STYLE="border-bottom: black 2.25pt double; text-align: right"><FONT STYLE="font-size: 10pt">(0.01</FONT></TD>
    <TD STYLE="padding-bottom: 2.5pt"><FONT STYLE="font-size: 10pt">)</FONT></TD>
    <TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: black 2.25pt double"><FONT STYLE="font-size: 10pt">$</FONT></TD>
    <TD STYLE="border-bottom: black 2.25pt double; text-align: right"><FONT STYLE="font-size: 10pt">(0.07</FONT></TD>
    <TD STYLE="padding-bottom: 2.5pt"><FONT STYLE="font-size: 10pt">)</FONT></TD>
    <TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: black 2.25pt double"><FONT STYLE="font-size: 10pt">$</FONT></TD>
    <TD STYLE="border-bottom: black 2.25pt double; text-align: right"><FONT STYLE="font-size: 10pt">(0.04</FONT></TD>
    <TD STYLE="padding-bottom: 2.5pt"><FONT STYLE="font-size: 10pt">)</FONT></TD></TR>
</TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"></P>







<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">Weighted average number of shares outstanding excludes anti-dilutive
common stock equivalents, including warrants to purchase 3 million shares of common stock for nominal consideration.</P>





<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B><I>&nbsp;</I></B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B><I><U>Advertising</U></I></B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">We
conduct advertising for the promotion of our products. In accordance with ASC 720-35, advertising costs are charged to operations
when incurred.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B><I><U>Related
Parties</U></I></B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">We
are indebted to certain members of our Board of Directors at June 30, 2020 and December 31, 2019. Transactions between us and
the Board members are summarized in Notes 4 and 8.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B><I><U>Recent
Accounting Pronouncements</U></I></B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">In
February 2016, the FASB issued ASU 2016-02, &ldquo;<I>Leases</I>&rdquo; (Topic 842). This ASU requires a lessee to recognize a
right-of-use asset and a lease liability for most leases in its balance sheet.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">We
adopted the standard on January 1, 2019, using the modified retrospective method. The adoption of this standard resulted in recognition
of a right-of-use asset and a lease liability, initially measured at the present value of the lease payments, for all leases with
a term greater than 12 months. When available, we would use the rate implicit in the lease to discount lease payments to present
value. However, our leases generally do not provide a readily determinable implicit rate. Therefore, our management estimates
the incremental borrowing rate to discount lease payments based on the information at the lease commencement. The accounting for
finance leases is substantially unchanged. Given the nature of our operation, the adoption of Topic 842 did not have a material
impact on our balance sheet, statement of income, or liquidity. Refer to Note 10 &ndash; Operating Lease Obligations for information
regarding our adoption of Topic 842 and the Company&rsquo;s undiscounted future lease payments and the timing of those payments.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">Management
does not believe that any other recently issued, but not yet effective, accounting standards could have a material effect on the
accompanying financial statements. As new accounting pronouncements are issued, we will adopt those that are applicable under
the circumstances.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B><U>Note
3 &ndash; Going Concern</U></B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><FONT STYLE="font-size: 10pt">The accompanying
financial statements have been prepared on a going concern basis, which contemplates the realization of assets and the satisfaction
of liabilities in the normal course of business. &nbsp;Our business operations have not yet generated significant revenues, and
we have sustained net losses of approximately $3.8 million during the six months ended June 30, 2020 and have an accumulated deficit
of approximately $40.5 million at June 30, 2020. In addition, we have current liabilities in excess of current assets of approximately
$2.4 million at June 30, 2020. Further, we are in default on approximately $0.6 million of indebtedness, including accrued interest.</FONT></P>
<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">Our
ability to continue as a going concern in the foreseeable future is dependent upon our ability to generate revenues and obtain
sufficient long-term financing to meet current and future obligations and deploy such to produce profitable operating results.
Management has evaluated these conditions and plans to raise capital as needed and to generate revenues to satisfy our capital
needs. No assurance can be given that we will be successful in these efforts.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">These
factors, among others, raise substantial doubt about our ability to continue as a going concern for a reasonable period of time.
These financial statements do not include any adjustments relating to the recoverability and classification of recorded asset
amounts or the amounts and classification of liabilities that might be necessary should we be unable to continue as a going concern.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><FONT STYLE="font-size: 10pt"><B>Splash Beverage
Group, Inc.</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><FONT STYLE="font-size: 10pt"><B>[f/k/a Canfield
Medical Supply, Inc.]</B></FONT></P>
<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B>Notes
to the Condensed Consolidated Financial Statements</B></FONT></P>


<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B><U>Note
4 &ndash; Notes Payable, Related Party Notes Payable, Convertible Bridge Loans Payable, Revenue Financing Arrangements and Bridge
Loan Payable</U></B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">Notes
payable are generally nonrecourse and secured by all Company owned assets.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: 10pt Times New Roman, Times, Serif; border-collapse: collapse; width: 100%">
<TR STYLE="vertical-align: bottom">
    <TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font-weight: bold; padding-bottom: 1pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD COLSPAN="3" STYLE="border-bottom: Black 1pt solid; font-weight: bold; text-align: center"><FONT STYLE="font-size: 10pt">Interest
    Rate</FONT></TD><TD STYLE="font-weight: bold; padding-bottom: 1pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD COLSPAN="3" STYLE="border-bottom: Black 1pt solid; font-weight: bold; text-align: center"><FONT STYLE="font-size: 10pt">June
    30, 2020</FONT></TD><TD STYLE="font-weight: bold; padding-bottom: 1pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD COLSPAN="3" STYLE="border-bottom: Black 1pt solid; font-weight: bold; text-align: center"><FONT STYLE="font-size: 10pt">December
    31, 2019</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="text-decoration: underline; font-weight: bold; text-align: left"><FONT STYLE="font-size: 10pt">Notes Payable</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="width: 46%; font-weight: normal; font-style: normal; text-align: justify; padding-left: 10pt"><FONT STYLE="font-size: 10pt">In
    October 2013, we entered into a short-term loan agreement with an entity in the amount of $25,000. In March 2020 the full
    outstanding principal balance of $25,000 and unpaid accrued interest of $11,345 was converted into 234,767 shares of common
    stock according to the Merger Agreement.</FONT></TD><TD STYLE="width: 5%"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="width: 1%; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="width: 11%; text-align: right"><FONT STYLE="font-size: 10pt">7</FONT></TD><TD STYLE="width: 1%; text-align: left"><FONT STYLE="font-size: 10pt">%</FONT></TD><TD STYLE="width: 5%"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="width: 1%; text-align: left"><FONT STYLE="font-size: 10pt">$</FONT></TD><TD STYLE="width: 11%; text-align: right"><FONT STYLE="font-size: 10pt">&mdash;&nbsp;&nbsp;</FONT></TD><TD STYLE="width: 1%; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="width: 5%"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="width: 1%; text-align: left"><FONT STYLE="font-size: 10pt">$</FONT></TD><TD STYLE="width: 11%; text-align: right"><FONT STYLE="font-size: 10pt">25,000</FONT></TD><TD STYLE="width: 1%; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="text-align: justify; padding-left: 10pt"><FONT STYLE="font-size: 10pt">In February 2014, we entered into a 12-month
    term loan agreement with an individual in the amount of $200,000. The note included warrants for 66,146 shares of common stock
    at $0.73 per share.&nbsp;&nbsp;The warrants expired on February 28, 2017 and none were exercised at that date. The note matured
    and remains unpaid.</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">15</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">%</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">150,000</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">150,000</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="text-align: justify; padding-left: 10pt"><FONT STYLE="font-size: 10pt">In March 2014, we entered into a 12-month
    term loan agreement with an individual in the amount of $500,000.&nbsp;&nbsp;The note included warrants for 681,461 shares
    of common stock at $0.92 per share. The warrants expired on February 28, 2017 and none were exercised at that date.&nbsp;&nbsp;In
    March 2020 the full outstanding principal balance of $500,000 and unpaid accrued interest of $373,065 was converted into 1,124,802
    shares of common stock according to the Merger Agreement.</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">15</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">%</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">&mdash;&nbsp;&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">500,000</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="text-align: justify; padding-left: 10pt"><FONT STYLE="font-size: 10pt">In March 2014, we entered into a short-term
    loan agreement with an entity in the amount of $200,000. The note included warrants for 272,584 shares of common stock at
    $0.94 per share. The warrants expired on February 28, 2017 and none were exercised at that date. The loans matured and remain
    unpaid.</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">8</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">%</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">200,000</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">200,000</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="text-align: justify; padding-left: 10pt"><FONT STYLE="font-size: 10pt">In May 2020, we entered into a two year
    loan with an entity under the Paycheck Protection Program established by the CARES Act in the amount of $94,833.32. The note
    requires monthly payments of principal and interest starting in December 2020 and maturing in May 2020. We expect $73,167
    of the loan amount to be forgiven in accordance with the CARES Act.</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">1</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">%</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">94,833</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">&mdash;&nbsp;&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="text-align: justify; padding-bottom: 1pt; padding-left: 10pt"><FONT STYLE="font-size: 10pt">In June 2020, we entered
    into a six-month loan with an individual in the amount of $100,000. The loan matures in December 2020 with principal and interest
    due at maturity.</FONT></TD><TD STYLE="padding-bottom: 1pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="padding-bottom: 1pt; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="padding-bottom: 1pt; text-align: right"><FONT STYLE="font-size: 10pt">12</FONT></TD><TD STYLE="padding-bottom: 1pt; text-align: left"><FONT STYLE="font-size: 10pt">%</FONT></TD><TD STYLE="padding-bottom: 1pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right"><FONT STYLE="font-size: 10pt">100,000</FONT></TD><TD STYLE="padding-bottom: 1pt; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="padding-bottom: 1pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right"><FONT STYLE="font-size: 10pt">&mdash;&nbsp;&nbsp;</FONT></TD><TD STYLE="padding-bottom: 1pt; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="padding-bottom: 2.5pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="padding-bottom: 2.5pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="padding-bottom: 2.5pt; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="padding-bottom: 2.5pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="border-bottom: Black 2.5pt double; text-align: left"><FONT STYLE="font-size: 10pt">$</FONT></TD><TD STYLE="border-bottom: Black 2.5pt double; text-align: right"><FONT STYLE="font-size: 10pt">544,833</FONT></TD><TD STYLE="padding-bottom: 2.5pt; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="padding-bottom: 2.5pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="border-bottom: Black 2.5pt double; text-align: left"><FONT STYLE="font-size: 10pt">$</FONT></TD><TD STYLE="border-bottom: Black 2.5pt double; text-align: right"><FONT STYLE="font-size: 10pt">875,000</FONT></TD><TD STYLE="padding-bottom: 2.5pt; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD></TR>
</TABLE>



<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">Interest
expense on notes payable was $10,429 and $28,813 for the three months ended June 30, 2020 and 2019, respectively. Interest expense
on notes payable was $59,859 and $57,626 for the six months ended June 30, 2020 and 2019, respectively. Accrued interest was $245,005
at June 30, 2020</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><FONT STYLE="font-size: 10pt">Concurrently
with the consummation of the Merger, notes payable of $525,000 and accrued interest were converted to shares of Splash common
stock, which were exchanged for Splash Beverage Group, Inc. [Formerly known as Canfield Medical Supply, Inc.] shares. Pursuant
to the terms of the conversion agreements, these investors have the right to rescind the common shares received and receive replacement
notes payable if we fail to raise $9 million in a secondary initial public offering by September 30, 2020. As a result, these
shares are classified as mezzanine equity in our condensed consolidated balance sheet.</FONT></P>
<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<!-- Field: Page; Sequence: 38 -->
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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><FONT STYLE="font-size: 10pt"><B>Splash Beverage
Group, Inc.</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><FONT STYLE="font-size: 10pt"><B>[f/k/a Canfield
Medical Supply, Inc.]</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B>Notes
to the Condensed Consolidated Financial Statements</B></FONT></P>


<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B><U>Note
4 &ndash; Notes Payable, Related Party Notes Payable, Convertible Bridge Loans Payable, Revenue Financing Arrangements and Bridge
Loan Payable, continued</U></B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B><U>&nbsp;</U></B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: 10pt Times New Roman, Times, Serif; border-collapse: collapse; width: 100%">
<TR STYLE="vertical-align: bottom">
    <TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font-weight: bold; padding-bottom: 1pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD COLSPAN="3" STYLE="border-bottom: Black 1pt solid; font-weight: bold; text-align: center"><FONT STYLE="font-size: 10pt">Interest
    Rate</FONT></TD><TD STYLE="font-weight: bold; padding-bottom: 1pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD COLSPAN="3" STYLE="border-bottom: Black 1pt solid; font-weight: bold; text-align: center"><FONT STYLE="font-size: 10pt">June
    30, 2020</FONT></TD><TD STYLE="font-weight: bold; padding-bottom: 1pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD COLSPAN="3" STYLE="border-bottom: Black 1pt solid; font-weight: bold; text-align: center"><FONT STYLE="font-size: 10pt">December
    31, 2019</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="text-decoration: underline; font-weight: bold; text-align: left"><FONT STYLE="font-size: 10pt">Related Parties
    Notes Payable</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="width: 46%; text-align: justify; padding-left: 10pt"><FONT STYLE="font-size: 10pt">During 2012, we entered into
    two 6-month term loan agreements with an entity, totaling $150,000. The notes included warrants for 68,146 shares of common
    stock at $0.73 per share which expired unexercised in 2017. In March 2020 the full outstanding principal balance of $41,500
    and unpaid accrued interest of $31,515 was converted into 98,726 shares of common stock according to the Merger Agreement.</FONT></TD><TD STYLE="width: 5%"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="width: 1%; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="width: 11%; text-align: right"><FONT STYLE="font-size: 10pt">7</FONT></TD><TD STYLE="width: 1%; text-align: left"><FONT STYLE="font-size: 10pt">%</FONT></TD><TD STYLE="width: 5%"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="width: 1%; text-align: left"><FONT STYLE="font-size: 10pt">$</FONT></TD><TD STYLE="width: 11%; text-align: right"><FONT STYLE="font-size: 10pt">&mdash;&nbsp;&nbsp;</FONT></TD><TD STYLE="width: 1%; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="width: 5%"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="width: 1%; text-align: left"><FONT STYLE="font-size: 10pt">$</FONT></TD><TD STYLE="width: 11%; text-align: right"><FONT STYLE="font-size: 10pt">41,500</FONT></TD><TD STYLE="width: 1%; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="text-align: justify; padding-left: 10pt"><FONT STYLE="font-size: 10pt">In March 2014, we entered into a $50,000
    12-month term loan agreement. The note included warrants for 136,292 shares of common stock at $0.92 per share. The warrants
    expired unexercised on February 28, 2017.&nbsp;&nbsp;In March 2020 the full outstanding principal balance of $50,000 and unpaid
    accrued interest of $24,145 was converted into 99,252 shares of common stock according to the Merger Agreement.</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">8</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">%</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">&mdash;&nbsp;&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">50,000</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="text-align: justify; padding-left: 10pt"><FONT STYLE="font-size: 10pt">During 2015, we entered into a 12-month
    term loan agreement with an individual in the amount $250,000.&nbsp;&nbsp;In March 2020 the full outstanding principal balance
    of $250,000 and unpaid accrued interest of $101,850 was converted into 98,726 shares of common stock according to the Merger
    Agreement.</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">8</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">%</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">&mdash;&nbsp;&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">250,000</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="text-align: justify; padding-left: 10pt"><FONT STYLE="font-size: 10pt">In February 2012, we entered into a loan
    agreement with an officer of the Company in the amount of $100. On September 25, 2018 an additional $10,500 loan agreement
    was entered into. In March 2020 the full outstanding principal balance of $10,600 and unpaid accrued interest of $1,189 was
    converted into 15,734 shares of common stock according to the Merger Agreement.</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">7</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">%</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">&mdash;&nbsp;&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">10,600</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="text-align: justify; padding-left: 10pt"><FONT STYLE="font-size: 10pt">During 2013, 2014, 2015, and 2016, we entered
    into several 12-month term loan agreements with an officer of the Company in the amounts of $57,000, $225,000, $105,000, and
    $9,000, respectively. In March 2020 the full outstanding principal balance of $396,000 and unpaid accrued interest of $146,828
    was converted into 727,344 shares of common stock according to the Merger Agreement.</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">7</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">%</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">&mdash;&nbsp;&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">396,000</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD></TR>
</TABLE>



<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B><U>&nbsp;</U></B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><I>Continued
on next page</I></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><FONT STYLE="font-size: 10pt"><B>Splash Beverage
Group, Inc.</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><FONT STYLE="font-size: 10pt"><B>[f/k/a Canfield
Medical Supply, Inc.]</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B>Notes
to the Condensed Consolidated Financial Statements</B></FONT></P>


<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B><U>Note
4 &ndash; Notes Payable, Related Party Notes Payable, Convertible Bridge Loans Payable, Revenue Financing Arrangements and Bridge
Loan Payable, continued</U></B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: 10pt Times New Roman, Times, Serif; border-collapse: collapse; width: 100%">
<TR STYLE="vertical-align: bottom">
    <TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font-weight: bold; padding-bottom: 1pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD COLSPAN="3" STYLE="border-bottom: Black 1pt solid; font-weight: bold; text-align: center"><FONT STYLE="font-size: 10pt">Interest
    Rate</FONT></TD><TD STYLE="font-weight: bold; padding-bottom: 1pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD COLSPAN="3" STYLE="border-bottom: Black 1pt solid; font-weight: bold; text-align: center"><FONT STYLE="font-size: 10pt">June
    30, 2020</FONT></TD><TD STYLE="font-weight: bold; padding-bottom: 1pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD COLSPAN="3" STYLE="border-bottom: Black 1pt solid; font-weight: bold; text-align: center"><FONT STYLE="font-size: 10pt">December
    31, 2019</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="text-decoration: underline; font-weight: bold; text-align: left"><FONT STYLE="font-size: 10pt">Related Parties
    Notes Payable, continued</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="width: 46%; text-align: justify; padding-left: 10pt"><FONT STYLE="font-size: 10pt">During 2012, 2013, 2014, and
    2016, we entered into 6-month term loan agreements with an officer of the Company in the amounts of $155,000, $210,000, $150,000
    and $40,000, all respectively. The notes included warrants for issuances of 204,438 shares of common stock at $.092 per share.
    The warrants expired unexercised on March 1, 2017. In March 2020 the full outstanding principal balance of $495,000 and unpaid
    accrued interest of $213,010 was converted into 942,504 shares of common stock according to the Merger Agreement.</FONT></TD><TD STYLE="width: 5%"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="width: 1%; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="width: 11%; text-align: right"><FONT STYLE="font-size: 10pt">7</FONT></TD><TD STYLE="width: 1%; text-align: left"><FONT STYLE="font-size: 10pt">%</FONT></TD><TD STYLE="width: 5%"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="width: 1%; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="width: 11%; text-align: right"><FONT STYLE="font-size: 10pt">&mdash;&nbsp;&nbsp;</FONT></TD><TD STYLE="width: 1%; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="width: 5%"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="width: 1%; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="width: 11%; text-align: right"><FONT STYLE="font-size: 10pt">495,000</FONT></TD><TD STYLE="width: 1%; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="text-align: justify; padding-left: 10pt"><FONT STYLE="font-size: 10pt">During 2013, 2014 and 2017, we entered into
    12-month term loan agreements with an officer of the Company in the amounts of $60,000, $50,000 and $10,000. In March 2020
    the full outstanding principal balance of $120,000 and unpaid accrued interest of $50,305 was converted into 228,328 shares
    of common stock according to the Merger Agreement.</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">7</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">%</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">&mdash;&nbsp;&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">120,000</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="text-align: justify; padding-left: 10pt"><FONT STYLE="font-size: 10pt">During 2018, we entered into a long term
    note payable with an entity owned by an officer for $12,000 to be payable on July 10, 2020. In March 2020 the full outstanding
    principal balance of $12,000 and unpaid accrued interest of $1,050 was converted into 17,407 shares of common stock according
    to the Merger Agreement.</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">12</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">%</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">&mdash;&nbsp;&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">12,000</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="text-align: justify; padding-bottom: 1pt; padding-left: 10pt"><FONT STYLE="font-size: 10pt">During 2019, we entered
    into a term note payable with an entity owned by an officer for $130,000 to be paid on August 8, 2019. In March 2020 the full
    outstanding principal balance of $130,000 and unpaid accrued interest of $9,078 was converted into 182,525 shares of common
    stock according to the Merger Agreement.</FONT></TD><TD STYLE="padding-bottom: 1pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="padding-bottom: 1pt; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="padding-bottom: 1pt; text-align: right"><FONT STYLE="font-size: 10pt">12</FONT></TD><TD STYLE="padding-bottom: 1pt; text-align: left"><FONT STYLE="font-size: 10pt">%</FONT></TD><TD STYLE="padding-bottom: 1pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right"><FONT STYLE="font-size: 10pt">&mdash;&nbsp;&nbsp;</FONT></TD><TD STYLE="padding-bottom: 1pt; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="padding-bottom: 1pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right"><FONT STYLE="font-size: 10pt">130,000</FONT></TD><TD STYLE="padding-bottom: 1pt; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD STYLE="padding-bottom: 2.5pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="padding-bottom: 2.5pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="padding-bottom: 2.5pt; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="padding-bottom: 2.5pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="border-bottom: Black 2.5pt double; text-align: left"><FONT STYLE="font-size: 10pt">$</FONT></TD><TD STYLE="border-bottom: Black 2.5pt double; text-align: right"><FONT STYLE="font-size: 10pt">&mdash;&nbsp;&nbsp;</FONT></TD><TD STYLE="padding-bottom: 2.5pt; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="padding-bottom: 2.5pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="border-bottom: Black 2.5pt double; text-align: left"><FONT STYLE="font-size: 10pt">$</FONT></TD><TD STYLE="border-bottom: Black 2.5pt double; text-align: right"><FONT STYLE="font-size: 10pt">1,505,100</FONT></TD><TD STYLE="padding-bottom: 2.5pt; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD></TR>
</TABLE>



<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">Interest
expense on related party notes payable was $0 and $24,814 for the three months ended June 30, 2020 and 2019, respectively. Interest
expense on related party notes payable was $37,967 and $49,628 for the six months ended June 30, 2020 and 2019, respectively.
Accrued interest was $0 as of June 30, 2020.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><FONT STYLE="font-size: 10pt">Concurrently
with the consummation of the Merger, notes payable of $1,505,100 and accrued interest were converted to shares of Splash common
stock, which were exchanged for Splash Beverage Group, Inc. [Formerly known as Canfield Medical Supply, Inc.] shares. Pursuant
to the terms of the conversion agreements, these investors have the right to rescind the common shares received and receive replacement
notes payable if we fail to raise $9 million in a secondary initial public offering by September 30, 2020. As a result, these
shares are classified as mezzanine equity in our condensed consolidated balance sheet.</FONT></P>
<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><FONT STYLE="font-size: 10pt"><B>Splash Beverage
Group, Inc.</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><FONT STYLE="font-size: 10pt"><B>[f/k/a Canfield
Medical Supply, Inc.]</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B>Notes
to the Condensed Consolidated Financial Statements</B></FONT></P>


<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B><U>Note
4 &ndash; Notes Payable, Related Party Notes Payable, Convertible Bridge Loans Payable, Revenue Financing Arrangements and Bridge
Loan Payable, continued</U></B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0"></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: 10pt Times New Roman, Times, Serif; border-collapse: collapse; width: 100%">
<TR STYLE="vertical-align: bottom">
    <TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font-weight: bold; padding-bottom: 1pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD COLSPAN="3" STYLE="border-bottom: Black 1pt solid; font-weight: bold; text-align: center"><FONT STYLE="font-size: 10pt">Interest
    Rate</FONT></TD><TD STYLE="font-weight: bold; padding-bottom: 1pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD COLSPAN="3" STYLE="border-bottom: Black 1pt solid; font-weight: bold; text-align: center"><FONT STYLE="font-size: 10pt">June
    30, 2020</FONT></TD><TD STYLE="font-weight: bold; padding-bottom: 1pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD COLSPAN="3" STYLE="border-bottom: Black 1pt solid; font-weight: bold; text-align: center"><FONT STYLE="font-size: 10pt">December
    31, 2019</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="text-decoration: underline; font-weight: bold; text-align: left"><FONT STYLE="font-size: 10pt">Convertible Bridge
    Loans Payable</FONT></TD><TD STYLE="font-weight: bold"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="font-weight: bold; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font-weight: bold; text-align: right"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font-weight: bold; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font-weight: bold"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="font-weight: bold; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font-weight: bold; text-align: right"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font-weight: bold; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font-weight: bold"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="font-weight: bold; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font-weight: bold; text-align: right"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font-weight: bold; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-weight: bold"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font-weight: bold"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="font-weight: bold; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font-weight: bold; text-align: right"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font-weight: bold; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font-weight: bold"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="font-weight: bold; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font-weight: bold; text-align: right"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font-weight: bold; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font-weight: bold"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="font-weight: bold; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font-weight: bold; text-align: right"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font-weight: bold; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="width: 46%; text-align: justify; padding-left: 10pt"><FONT STYLE="font-size: 10pt">In May 2015, we entered into
    a 3-month term loan agreement with an individual in the amount of $100,000. The annual interest rate for this bridge loan
    was 32% for the first 90 days, and 4% thereafter, compounded monthly.</FONT></TD><TD STYLE="width: 5%"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="width: 1%; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="width: 11%; text-align: right"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">See
                                         left</FONT></TD><TD STYLE="width: 1%; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="width: 5%"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="width: 1%; text-align: left"><FONT STYLE="font-size: 10pt">$</FONT></TD><TD STYLE="width: 11%; text-align: right"><FONT STYLE="font-size: 10pt">100,000</FONT></TD><TD STYLE="width: 1%; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="width: 5%"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="width: 1%; text-align: left"><FONT STYLE="font-size: 10pt">$</FONT></TD><TD STYLE="width: 11%; text-align: right"><FONT STYLE="font-size: 10pt">100,000</FONT></TD><TD STYLE="width: 1%; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="text-align: justify; padding-left: 10pt"><FONT STYLE="font-size: 10pt">In October 2015, we entered into a 3-month
    term loan agreement with two individuals in the amount of $25,000. On December 26, 2018, the outstanding principal and accrued
    interest of $14,388 was consolidated into a new $39,388 term loan due August 26, 2020. In March 2020 the full outstanding
    principal balance of $39,388 and unpaid accrued interest of $5,973 was converted into 59,694 shares of common stock according
    to the Merger Agreement.</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">12</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">%</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">&mdash;&nbsp;&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">39,388</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="text-align: justify; padding-left: 10pt"><FONT STYLE="font-size: 10pt">In June 2015, we entered into a 3-month
    term loan with two individuals in the amount of $100,000. On December 26, 2018, the outstanding principal amount of $100,000
    and accrued interest of $64,307 was consolidated into a new $164,307 term loan due August 26, 2020. In March 2020 the full
    outstanding principal balance of $164,307 and unpaid accrued interest of $24,916 was converted into 249,013 shares of common
    stock according to the Merger Agreement.</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">12</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">%</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">&mdash;&nbsp;&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">164,307</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="text-align: justify; padding-left: 10pt"><FONT STYLE="font-size: 10pt">During 2016, 2017 and 2018, we entered into
    multiple loan agreements with an entity in varying amounts. On December 26, 2018, the outstanding principal of $235,500 and
    accrued interest of $155,861 was consolidated into a new $391,361 term due August 26, 2020. In March 2020 the full outstanding
    principal balance of $391,361 and unpaid accrued interest of $43,823 was converted into 435,184 shares of common stock according
    to the Merger Agreement.</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">12</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">%</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">&mdash;&nbsp;&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">391,361</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-style: italic"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="text-align: justify; padding-left: 10pt"><FONT STYLE="font-size: 10pt">During 2016, we entered into 3-month term
    loan agreements with an individual totaling $20,000. The loan was extended to August 14, 2020. In March 2020 the full outstanding
    principal balance of $20,000 and unpaid accrued interest of $10,096 was converted into 41,336 shares of common stock according
    to the Merger Agreement.</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">9</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">%</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">&mdash;&nbsp;&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">20,000</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="text-align: justify; padding-left: 10pt"><FONT STYLE="font-size: 10pt">During 2014 through 2018, we entered into
    convertible promissory note agreements with various terms ranging from 90 days to 18 months at 18% interest with an entity
    which were consolidated into one loan at 12% in 2018 totaling $795,137 with a due date of August 26, 2020. In March 2020 the
    full outstanding principal balance of $795,137 and unpaid accrued interest of $89,037 was converted into 884,174 shares of
    common stock according to the Merger Agreement.</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">12</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">%</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">&mdash;&nbsp;&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">795,137</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="text-align: justify; padding-bottom: 1pt; padding-left: 10pt"><FONT STYLE="font-size: 10pt">During 2015 and 2016,
    we entered into a series of 3-month term convertible promissory note agreements at 18% interest with an entity which were
    consolidated into one loan at 12% in 2018 totaling $692,471 with a due date of August 26, 2020. In March 2020 the full outstanding
    principal balance of $692,471 and unpaid accrued interest of $77,541 was converted into 770,012 shares of common stock according
    to the Merger Agreement.</FONT></TD><TD STYLE="padding-bottom: 1pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="padding-bottom: 1pt; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="padding-bottom: 1pt; text-align: right"><FONT STYLE="font-size: 10pt">12</FONT></TD><TD STYLE="padding-bottom: 1pt; text-align: left"><FONT STYLE="font-size: 10pt">%</FONT></TD><TD STYLE="padding-bottom: 1pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right"><FONT STYLE="font-size: 10pt">&mdash;&nbsp;&nbsp;</FONT></TD><TD STYLE="padding-bottom: 1pt; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="padding-bottom: 1pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right"><FONT STYLE="font-size: 10pt">692,471</FONT></TD><TD STYLE="padding-bottom: 1pt; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD STYLE="padding-bottom: 2.5pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="padding-bottom: 2.5pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="padding-bottom: 2.5pt; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="padding-bottom: 2.5pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="border-bottom: Black 2.5pt double; text-align: left"><FONT STYLE="font-size: 10pt">$</FONT></TD><TD STYLE="border-bottom: Black 2.5pt double; text-align: right"><FONT STYLE="font-size: 10pt">100,000</FONT></TD><TD STYLE="padding-bottom: 2.5pt; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="padding-bottom: 2.5pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="border-bottom: Black 2.5pt double; text-align: left"><FONT STYLE="font-size: 10pt">$</FONT></TD><TD STYLE="border-bottom: Black 2.5pt double; text-align: right"><FONT STYLE="font-size: 10pt">2,202,664</FONT></TD><TD STYLE="padding-bottom: 2.5pt; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD></TR>
</TABLE>



<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0"></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0"></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">During
2018, we issued convertible bridge loans payable which are convertible, at the holders&rsquo; option, into shares of our common
stock.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">During
2018 multiple convertible bridge loans payable to five counterparties, and related unpaid interest were consolidated into five
new convertible bridge loans payable totaling $2,082,665. The notes are of varying amounts and are due in August 2020, at an interest
rate of 12%. We analyzed the notes and concluded the conversion terms did not constitute beneficial conversion features. The principal
amount and any accrued and unpaid interest are convertible at the conversion price of a potential future offering of the Company.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><FONT STYLE="font-size: 10pt"><B>Splash Beverage
Group, Inc.</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><FONT STYLE="font-size: 10pt"><B>[f/k/a Canfield
Medical Supply, Inc.]</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B>Notes
to the Condensed Consolidated Financial Statements</B></FONT></P>


<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B><U>Note
4 &ndash; Notes Payable, Related Party Notes Payable, Convertible Bridge Loans Payable, Revenue Financing Arrangements and Bridge
Loan Payable, continued</U></B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">Interest
expense on the convertible bridge loans payable was $8,000 and $70,480 for the three months ended June 30, 2020 and 2019, respectively.
Interest expense on the convertible bridge loans payable was $101,785 and $140,960 for the six months ended June 30, 2020 and
2019, respectively. Accrued interest was $155,215 at June 30, 2020.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">On
April 24, 2017, a note holder filed a complaint against the Company for a promissory note in default. The note holder is requesting
summary judgment in the amount of $247,215.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><FONT STYLE="font-size: 10pt">Concurrently
with the consummation of the Merger, notes payable of $2,102,664 and accrued interest were converted to shares of Splash common
stock, which were exchanged for Splash Beverage Group, Inc. [Formerly known as Canfield Medical Supply, Inc.] shares. Pursuant
to the terms of the conversion agreements, these investors have the right to rescind the common shares received and receive replacement
notes payable if we fail to raise $9 million in a secondary initial public offering by September 30, 2020. As a result, these
shares are classified as mezzanine equity in our condensed consolidated balance sheet.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: 10pt Times New Roman, Times, Serif; border-collapse: collapse; width: 100%">
<TR STYLE="vertical-align: bottom">
    <TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font-weight: bold; padding-bottom: 1pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD COLSPAN="3" STYLE="border-bottom: Black 1pt solid; font-weight: bold; text-align: center"><FONT STYLE="font-size: 10pt">Interest
    Rate</FONT></TD><TD STYLE="font-weight: bold; padding-bottom: 1pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD COLSPAN="3" STYLE="border-bottom: Black 1pt solid; font-weight: bold; text-align: center"><FONT STYLE="font-size: 10pt">June
    30, 2020</FONT></TD><TD STYLE="font-weight: bold; padding-bottom: 1pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD COLSPAN="3" STYLE="border-bottom: Black 1pt solid; font-weight: bold; text-align: center"><FONT STYLE="font-size: 10pt">December
    31, 2019</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="text-decoration: underline; font-weight: bold; text-align: left"><FONT STYLE="font-size: 10pt">Revenue Financing
    Arrangements</FONT></TD><TD STYLE="font-weight: bold"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="font-weight: bold; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font-weight: bold; text-align: right"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font-weight: bold; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font-weight: bold"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="font-weight: bold; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font-weight: bold; text-align: right"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font-weight: bold; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font-weight: bold"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="font-weight: bold; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font-weight: bold; text-align: right"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font-weight: bold; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="width: 46%; text-align: justify; padding-left: 10pt"><FONT STYLE="font-size: 10pt">During August 2015, we entered
    into a 3-month term loan agreement with an entity in the amount of $50,000, with required daily payments of $999. we entered
    into two additional 3-month loan agreements with the entity in 2016 in the amounts of $60,000 and $57,000, with required daily
    payments of $928 and $713, respectively.&nbsp;&nbsp;&nbsp;The term loans matured and remain unpaid.</FONT></TD><TD STYLE="width: 5%"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="width: 1%; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="width: 11%; text-align: right"><FONT STYLE="font-size: 10pt">10</FONT></TD><TD STYLE="width: 1%; text-align: left"><FONT STYLE="font-size: 10pt">%</FONT></TD><TD STYLE="width: 5%"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="width: 1%; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="width: 11%; text-align: right"><FONT STYLE="font-size: 10pt">28,032</FONT></TD><TD STYLE="width: 1%; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="width: 5%"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="width: 1%; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="width: 11%; text-align: right"><FONT STYLE="font-size: 10pt">28,032</FONT></TD><TD STYLE="width: 1%; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="text-align: justify; padding-bottom: 1pt; padding-left: 10pt"><FONT STYLE="font-size: 10pt">During November 2016,
    we entered into a short-term loan agreement with an entity in the amount of $55,000 with required daily payments of $1,299.
    The note was in default as of December 31, 2018. In 2019, we entered into a settlement agreement with monthly installment
    payments of $6,000.&nbsp;&nbsp;The loan is scheduled to be fully repaid in 2020.</FONT></TD><TD STYLE="padding-bottom: 1pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="padding-bottom: 1pt; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="padding-bottom: 1pt; text-align: right"><FONT STYLE="font-size: 10pt">12</FONT></TD><TD STYLE="padding-bottom: 1pt; text-align: left"><FONT STYLE="font-size: 10pt">%</FONT></TD><TD STYLE="padding-bottom: 1pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right"><FONT STYLE="font-size: 10pt">17,435</FONT></TD><TD STYLE="padding-bottom: 1pt; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="padding-bottom: 1pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right"><FONT STYLE="font-size: 10pt">17,435</FONT></TD><TD STYLE="padding-bottom: 1pt; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD STYLE="padding-bottom: 2.5pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="padding-bottom: 2.5pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="padding-bottom: 2.5pt; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="padding-bottom: 2.5pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="border-bottom: Black 2.5pt double; text-align: left"><FONT STYLE="font-size: 10pt">$</FONT></TD><TD STYLE="border-bottom: Black 2.5pt double; text-align: right"><FONT STYLE="font-size: 10pt">45,464</FONT></TD><TD STYLE="padding-bottom: 2.5pt; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="padding-bottom: 2.5pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="border-bottom: Black 2.5pt double; text-align: left"><FONT STYLE="font-size: 10pt">$</FONT></TD><TD STYLE="border-bottom: Black 2.5pt double; text-align: right"><FONT STYLE="font-size: 10pt">45,464</FONT></TD><TD STYLE="padding-bottom: 2.5pt; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD></TR>
</TABLE>



<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">Interest expense on the revenue financing arrangements
was $25,067 and $1,723 for the year ended June 30, 2020 and 2019, respectively. Accrued interest was $0 at June 30, 2020.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B><I><U>Bridge
Loan Payable</U></I></B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">We
issued an additional bridge loan in October 2018 for $2 million with a one-year maturity to GMA Bridge Fund LLC (&ldquo;GMA&rdquo;).
This bridge loan contains a 10% administration fee of which the full $200,000 was accrued at December 31, 2019 and included in
bridge loan payable, net. We incurred $271,670 of loan costs, which was fully amortized at December 31, 2019. Interest on the
bridge loan was 0.5% monthly for the first six months and 0.75% monthly for the next six months. At the same time the debt was
issued, we entered into a separate agreement in which GMA provided consulting services for one year (&ldquo;Consulting Agreement&rdquo;).
We compensated GMA for the Consulting Agreement services by issuance of a warrant with a 5-year term to acquire 1,362,922 shares
of our common stock at an exercise price of $0.01 per share. The warrant vested immediately. The value of the warrant, based on
a Black-Scholes option pricing model, was $991,423 and was expensed in full in 2018. Interest expense on the bridge loan for the
six months ended June 30, 2020 was $0 and accrued interest at June 30, 2020 was $0.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">As
part of GMA&rsquo;s conversion agreement, we replaced the original warrants to purchase 1 million shares and granted additional
warrants. To purchase 1 million shares. The value of the warrants based on a Black-Scholes option pricing model, was $1,657,805,
and was expensed.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><FONT STYLE="font-size: 10pt">Concurrently
with the consummation of the Merger, the $2,500,000 note payable of was converted to shares of Splash common stock, which were
exchanged for Splash Beverage Group, Inc. [Formerly known as Canfield Medical Supply, Inc.] shares. Pursuant to the terms of the
conversion agreements, GMA has the right to rescind the common shares received and receive replacement notes payable if we fail
to raise $9 million in a secondary initial public offering by September 30, 2020. As a result, these shares are classified as
mezzanine equity in our condensed consolidated balance sheet.</FONT></P>
<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><FONT STYLE="font-size: 10pt"><B>Splash Beverage
Group, Inc.</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><FONT STYLE="font-size: 10pt"><B>[f/k/a Canfield
Medical Supply, Inc.]</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B>Notes
to the Condensed Consolidated Financial Statements</B></FONT></P>


<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B><U>Note
5 &ndash; Licensing Agreement and Royalty Payable</U></B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">We
have a licensing agreement with ABG TapouT, LLC (&ldquo;TapouT&rdquo;), providing us with licensing rights to the brand &ldquo;TapouT&rdquo;
on energy drinks, energy shots, water, teas and sports drinks for beverages sold in the United States of America, its territories,
possessions, U.S. military bases and Mexico. Under the terms of the agreement, we are required to pay a 6% royalty on net sales,
as defined. In 2020 and 2019, we are required to make monthly payments of $45,000 and $39,000, respectively.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">The
unpaid amount of royalties was $90,000 at June 30, 2020. Guaranteed minimum royalty payments totaled $135,000 and $117,000 for
the three months ended June 30, 2020 and 2019, which is included in general and administrative expenses. Guaranteed minimum royalty
payments totaled $270,000 and $234,000 for the six months ended June 30, 2020 and 2019, which is included in general and administrative
expenses.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><B><U>Note 6 &ndash; Deficiency in Stockholders&rsquo;
Equity </U></B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B><I><U>Series
A and B Convertible Preferred Stock</U></I></B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">As
part of the merger consummated on March 31, 2020, all series A and B convertible preferred stock were converted to common stock.
If the Company is unable to achieve the capital raise event as defined in the Merger Agreement by September 30, 2020, these shareholders
can rescind their common shares back to preferred shares. Below are the new rights to these shareholders if they decide to rescind:</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B><U>Series
A Convertible Preferred Stock</U></B>:</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">Rank.
The Series A Preferred Stock shall rank, with respect to dividend rights and to rights upon any voluntary or involuntary liquidation,
dissolution or winding up of the Company (each, a &ldquo;Liquidation Event&rdquo;), (a) senior in preference and priority to the
common stock of the Company (the &ldquo;Common Stock&rdquo;) and any other class or series of equity security established and
designated by the Board of Directors the terms of which do not expressly provide that it ranks senior in preference or priority
to or on parity with the Series A Preferred Stock with respect to dividend rights and rights upon a Liquidation Event (collectively,
&ldquo;Junior Securities&rdquo;), (b) on parity, without preference or priority, with each other class or series of equity security
established and designated by the Board of Directors the terms of which expressly provide that it ranks on parity, without preference
or priority to, the Series A Preferred Stock with respect to dividend rights and rights upon a Liquidation Event (collectively,
&ldquo;Parity Securities&rdquo;), and (c) junior in preference and priority to each other class or series of equity security established
and designated by the Board of Directors the terms of which expressly provide that it ranks senior in preference or priority to
the Series A Preferred Stock with respect to dividend rights and rights upon a Liquidation Event (collectively, &ldquo;Senior
Securities&rdquo;).</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">Dividends.
Holders of shares of the Series A Preferred Stock are entitled to receive, when, as and if declared by the Board, out of funds
legally available for the payment of dividends, cumulative cash dividends at an annual rate of eight percent (8%) of the Original
Issue Price per share (equal to $.08 per share per annum). Dividends shall accrue on each share of Series A Preferred Stock from
the date of issuance thereof, whether paid or not, and shall be cumulative and compounded annually.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">Liquidation
Preference. In the event of any Liquidation Event, the holders of shares of Series A Preferred Stock then outstanding shall be
entitled to be paid out of the assets of the Company available for distribution to its stockholders before any payment shall be
made to the holders of any Junior Securities by reason of their ownership thereof, an amount per share equal to one hundred fifty
percent (150%) of the Series A Original Issue Price (the &ldquo;Liquidation Preference&rdquo;), plus the amount of accrued and
unpaid dividends thereon from the Original Issue Date through the date of liquidation. If upon any such Liquidation Event the
assets of the Company available for distribution to its stockholders shall be insufficient to pay the holders of shares of Series
A Preferred Stock the full amount to which they shall be entitled under this, the holders of shares of Series A Preferred Stock
and Parity Securities shall share ratably in any distribution of the assets available for distribution in proportion to the respective
amounts which would otherwise be payable in respect of the shares held by them upon such distribution if all amounts payable on
or with respect to such shares were paid in full.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">Conversion.
The holders of Series A Preferred Stock shall have conversion rights as follows (the &ldquo;Conversion Rights&rdquo;):</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">Optional
Conversion. Each share of Series A Preferred Stock shall be convertible, at the option of the holder thereof, at any time and
from time to time, into such number of fully paid and non-assessable shares of Common Stock as is determined by dividing the Series
A Original Issue Price by the Conversion Price (as defined below) in effect at the time of conversion. The Conversion Price at
which shares of Common Stock shall be deliverable upon conversion of Series A Preferred Stock without the payment of additional
consideration by the holder thereof (the &ldquo;Conversion Price&rdquo;) shall initially be $1.28 per share. Such initial Conversion
Price, and the rate at which shares of Series A Preferred Stock may be converted into shares of Common Stock, shall be subject
to adjustment as provided below. All accrued and unpaid dividends may be converted by each holder of Series A Preferred Stock
into Common Stock by first determining the number of shares of Series A Preferred Stock that could be purchased based on the Series
A Original Issue Price then in effect and then determining the number of shares of Common Stock such additional shares of Series
A Preferred Stock are convertible into. By way of illustration only, if the accrued and unpaid dividends are equal to $100,000,
then based on the Series A Original Issue Price of $1.00 and a Conversion Price of $0.85, the holders of Series A Preferred Stock
would receive an additional 85,000 shares of Common Stock.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">Automatic
Conversion. Upon the consummation of an underwritten public offering of the Common Stock of the Company (&ldquo;IPO&rdquo;) ,
each share of Series A Preferred Stock shall automatically be converted into such number of fully paid and non-assessable shares
of Common Stock at a Conversion Price equal to the lesser of (i) the Conversion Price in effect immediately prior to the consummation
of the IPO or (ii) fifty percent (50%) of the public offering price of the Common Stock in the IPO. All accrued and unpaid dividends
may be converted by each holder of Series A Preferred Stock into Common Stock by first determining the number of shares of Series
A Preferred Stock that could be purchased based on the Series A Original Issue Price then in effect and then determining the number
of shares of Common Stock such additional shares of Series A Preferred Stock are convertible into. By way of illustration only,
if the accrued and unpaid dividends are equal to $100,000, then based on the Series A Original Issue Price of $1.00 and a Conversion
Price of $0.85, the holders of Series A Preferred Stock would receive an additional 85,000 shares of Common Stock.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><B><U>&nbsp;</U></B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><B><U>Note 6 &ndash; Deficiency in Stockholders&rsquo;
Equity, continued</U></B></P>
<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B><U>Series
B Convertible Preferred Stock</U></B>:</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">Rank.
The Series B Preferred Stock shall rank, with respect to dividend rights and to rights upon any voluntary or involuntary liquidation,
dissolution or winding up of the Company (each, a &ldquo;Liquidation Event&rdquo;), (a) senior in preference and priority to the
common stock of the Company (the &ldquo;Common Stock&rdquo;) and any other class or series of equity security established and
designated by the Board of Directors the terms of which do not expressly provide that it ranks senior in preference or priority
to or on parity with the Series B Preferred Stock with respect to dividend rights and rights upon a Liquidation Event (collectively,
&ldquo;Junior Securities&rdquo;), (b) on parity, without preference or priority, with the Series A Preferred Stock and with each
other class or series of equity security established and designated by the Board of Directors the terms of which expressly provide
that it ranks on parity, without preference or priority to, the Series B Preferred Stock with respect to dividend rights and rights
upon a Liquidation Event (collectively, &ldquo;Parity Securities&rdquo;), and (c) junior in preference and priority to each other
class or series of equity security established and designated by the Board of Directors the terms of which expressly provide that
it ranks senior in preference or priority to the Series B Preferred Stock with respect to dividend rights and rights upon a Liquidation
Event (collectively, &ldquo;Senior Securities&rdquo;).</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">Dividends.
The holders of the Series B Preferred Stock shall be entitled to receive cash dividends, when, as and if declared by the Board,
out of any assets legally available therefor, prior and in preference to any declaration or payment of any dividend on any other
class of Preferred Stock, except for the Series A Preferred Stock which shall be paid at the same time as the Series B Preferred
Stock is paid, and Common Stock of the Corporation at an annual rate of nine percent (9%) of the Original Issue Price per share
(equal to $.09 per share per annum) payable out of legally available funds. Dividends shall accrue on each share of Series B Preferred
Stock from the date of issuance thereof, whether paid or not, and shall be cumulative and compounded annually. Such dividends
shall be payable on the first day of each January, April, July and October commencing with respect to each share of Series B Preferred
Stock, on the first of such dates to occur after the issuance of such share (each such date a &ldquo;Dividend Payment Date&rdquo;)
to the holders of record at the close of business on the fifteenth day of each December, March, June and September, respectively,
subject to declaration of such dividends by the Board. All dividends paid with respect to shares of Series B Preferred Stock shall
be paid pro rata to the holders entitled thereto. Dividends, if paid, must be paid, on all outstanding shares of Series B Preferred
Stock contemporaneously. If any dividend shall not be paid on a Dividend Payment Date, for any reason, the right of the holders
to receive such dividend shall not lapse or terminate but each such dividend shall accrue and be paid to such holders, subject
to the conversion provisions below. No dividend shall be paid to the holders of any shares of Common Stock until all dividends,
including accrued dividends, then owing to the holders of Series B Preferred Stock, shall have been paid in full.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">Liquidation
Preference. In the event of any Liquidation Event, the holders of shares of Series B Preferred Stock then outstanding shall be
entitled to be paid out of the assets of the Company available for distribution to its stockholders before any payment shall be
made to the holders of any Junior Securities by reason of their ownership thereof, an amount per share equal to one hundred fifty
percent (150%) of the Series B Original Issue Price (the &ldquo;Liquidation Preference&rdquo;), plus the amount of accrued and
unpaid dividends thereon from the Original Issue Date through the date of liquidation. If upon any such Liquidation Event the
assets of the Company available for distribution to its stockholders shall be insufficient to pay the holders of shares of Series
B Preferred Stock the full amount to which they shall be entitled under this Section , the holders of shares of Series B Preferred
Stock and Parity Securities shall share ratably in any distribution of the assets available for distribution in proportion to
the respective amounts which would otherwise be payable in respect of the shares held by them upon such distribution if all amounts
payable on or with respect to such shares were paid in full.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">Conversion.
The holders of Series B Preferred Stock shall have conversion rights as follows (the &ldquo;Conversion Rights&rdquo;):</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">Optional
Conversion. Each share of Series B Preferred Stock shall be convertible, at the option of the holder thereof, at any time and
from time to time, into such number of fully paid and non-assessable shares of Common Stock as is determined by dividing the Series
B Original Issue Price by the Conversion Price (as defined below) in effect at the time of conversion. The Conversion Price at
which shares of Common Stock shall be deliverable upon conversion of Series B Preferred Stock without the payment of additional
consideration by the holder thereof (the &ldquo;Conversion Price&rdquo;) shall initially be $1.28 per share. Such initial Conversion
Price, and the rate at which shares of Series B Preferred Stock may be converted into shares of Common Stock, shall be subject
to adjustment as provided below. All accrued and unpaid dividends may be converted by each holder of Series B Preferred Stock
into Common Stock by first determining the number of shares of Series B Preferred Stock that could be purchased based on the Series
B Original Issue Price then in effect and then determining the number of shares of Common Stock such additional shares of Series
B Preferred Stock are convertible into. By way of illustration only, if the accrued and unpaid dividends are equal to $100,000,
then based on the Series B Original Issue Price of $1.50 and a Conversion Price of $1.28, the holders of Series B Preferred Stock
would receive an additional 78,125 shares of Common Stock.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">Automatic
Conversion. Upon the consummation of an underwritten public offering of the Common Stock of the Company (&ldquo;IPO&rdquo;), each
share of Series B Preferred Stock shall automatically be converted into such number of fully paid and non-assessable shares of
Common Stock at a Conversion Price equal to the lesser of (i) the Conversion Price in effect immediately prior to the consummation
of the IPO or (ii) fifty percent (50%) of the public offering price of the Common Stock in the IPO. All accrued and unpaid dividends
may be converted by each holder of Series B Preferred Stock into Common Stock by first determining the number of shares of Series
B Preferred Stock that could be purchased based on the Series B Original Issue Price then in effect and then determining the number
of shares of Common Stock such additional shares of Series B Preferred Stock are convertible into. By way of illustration only,
if the accrued and unpaid dividends are equal to $100,000, then based on the Series B Original Issue Price of $1.50 and a Conversion
Price of $1.28, the holders of Series B Preferred Stock would receive an additional 78,125 shares of Common Stock.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B><I><U>Common
Stock</U></I></B></FONT></P>

<P STYLE="font: 12pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">In
2019, we issued 1,846,078 shares of our common stock in exchange for services provided to us. The shares were valued at $0.73
per share. We recognized share-based compensation expense of $1,354,500, which is classified within the contracted services line
on the Statement of Operations. At June 30, 2020, we issued 249,912 shares of common stock in exchange for cash. The shares were
valued at $0.73 per share.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;<B><I>&nbsp;</I></B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B><I><U>Treasury
Stock</U></I></B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">Since
its inception, we have repurchased shares from our shareholders. To date, we have repurchased 1,226,630 shares, of which 817,753
have been retired.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">In
connection with a 2018 consulting agreement, we were committed to issue the 408,877 shares held in treasury upon the occurrence
of certain events or milestones. We issued 136,292 shares in July 2018, 136,292 shares in July 2019 and 136,292 shares on March
31, 2020.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B><I><U>Warrant
Issuance-Common Stock </U></I></B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">As
part of the sale and issuance of 4,088,765 shares of our Series A Convertible Preferred Stock, we issued 4,088,765 warrants to
purchase shares of our common stock at a price of $0.73 per share. The warrants had a five-year term and expired during 2019.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">As
an incentive to convert their Series A preferred stock we issued 1,000,000 new warrants to purchase shares of SBG common stock
at $0.18 per share. Concurrently with the consummation of the Merger, these warrants were exchanged for 1,362,922 of Splash Beverage
Group, Inc. [Formerly known as Canfield Medical Supply, Inc.] shares. These warrants have a 3-year term.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B><I><U>Warrant
Issuance-Common Stock</U></I></B>&nbsp;</FONT></P>

<P STYLE="font: 12pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">As
part of the sale and issuance of 5,333,675 shares of our Series B Convertible Preferred Stock, we issued 2,666,839 warrants to
purchase shares our common stock at a price of $1.10 per share. The warrants have a 5-year term. At June 30, 2020, there are 1,145,786&nbsp;&nbsp;
warrants outstanding with a weighted average remaining life of 0.3 years.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">As
part of the sale of 100,000 shares of common stock, we issued 325,000 warrants to purchase shares of our common stock at a price
of $0.25 per share. These warrants have a 3-year term.</FONT></P>



<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><FONT STYLE="font-size: 10pt"><B>Splash Beverage
Group, Inc.</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><FONT STYLE="font-size: 10pt"><B>[f/k/a Canfield
Medical Supply, Inc.]</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B>Notes
to the Condensed Consolidated Financial Statements</B></FONT></P>


<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B><U>Note
7 &ndash; Share-Based Payments</U></B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B>&nbsp;</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B><I><U>Warrant
Issuance-GMA Consulting Services</U></I></B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">We
issued 1,362,922 warrants to purchase shares of our common stock at $0.007 per share as part of our consulting agreement with
GMA, at December 31, 2019, the weighted average life of the outstanding warrants is 3.75 years.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 12pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">The
warrants entitle the holder to purchase one share per warrant of the Company&rsquo;s common stock at a price of $0.01 per
share during the five-year period commencing on October 2, 2018, or, if greater, the number of common shares with a market value
equivalent to two percent of the enterprise value of the Company at an exercise price of $0.008 per share.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">As
an incentive for GMA to convert their debt and accrued interest into shares of common stock, we retired the original 1,362,922
warrants and issued 2,725,844 pre-merger new warrants to purchase shares of our common stock at $0.18 per share. These warrants
have a 3-year term.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B><I><U>Stock
Plan</U></I></B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">We
have adopted the 2012 Stock Incentive Plan for SBG (the &ldquo;Plan&rdquo;), which provides for the grant of common stock and
stock options to employees. We have reserved 4,088,765 shares for issuance under the Plan. The option exercise price generally
may not be less than the underlying stock&rsquo;s fair market value at the date of the grant and generally have a term of ten
years. On December 31, 2018, the sole option holder at the time, our CEO, exercised his options to purchase 2,657,698 shares of
common stock at a purchase price of $0.12 per share, totaling $312,000, which total purchase price was paid by the cancelation
of the equivalent amount of debt owed by us to the CEO. On December 7, 2019, our Board of Directors granted 1,124,410 options
to certain employees and consultants. None of these options were exercised at June 30, 2020. There are 1,124,410 options issued
and outstanding under the Plan at June 30, 2020. As of June 30, 2020, the total number of options available for grant is 306,657.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">We
measure employee stock-based awards at the grant-date fair value and recognizes employee compensation expense on a straight-line
basis over the vesting period of the award. Determining the appropriate fair value of stock-based awards requires the input of
subjective assumptions, including the fair value of our common stock, and for stock options, the expected life of the option,
and expected stock price volatility and exercise price. We used the Black-Scholes option pricing model to value its stock option
awards. The assumptions used in calculating the fair value of stock- based awards represent management&rsquo;s best estimates
and involve inherent uncertainties and the application of management&rsquo;s judgment. As a result, if factors change and management
uses different assumptions, stock-based compensation expense could be materially different for future awards. The expected life
of stock options was estimated using the &ldquo;simplified method,&rdquo; which calculates the expected term as the midpoint between
the weighted average time to vesting and the contractual maturity, we have limited historical information to develop reasonable
expectations about future exercise patterns and employment duration for its stock options grants. The simplified method is based
on the average of the vesting tranches and the contractual life of each grant. For stock price volatility, we use comparable public
companies as a basis for its expected volatility to calculate the fair value of options granted. The risk-free interest rate is
based on U.S. Treasury notes with a term approximating the expected life of the option. The estimation of the number of stock
awards that will ultimately vest requires judgment, and to the extent actual results or updated estimates differ from the Company&rsquo;s
current estimates, such amounts are recognized as an adjustment in the period in which estimates are revised.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">We
recognized stock-based compensation expense of $265,589 for the year ended December 31, 2019. There was no unrecognized compensation
cost related to stock option awards at June 30, 2020.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">Concurrently with the consummation of the
Merger, options to purchase 825,000 SBC shares were converted to options to purchase 1,124,410 Splash Beverage Group, Inc. [Formerly
Canfield Medical Supply, Inc.] shares.<B>&nbsp;</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: 10pt Times New Roman, Times, Serif; border-collapse: collapse; width: 100%">
<TR STYLE="vertical-align: bottom">
    <TD STYLE="text-align: center"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font-weight: bold; padding-bottom: 1pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD COLSPAN="3" STYLE="border-bottom: Black 1pt solid; font-weight: bold; text-align: center"><FONT STYLE="font-size: 10pt">Options</FONT></TD><TD STYLE="font-weight: bold; padding-bottom: 1pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD COLSPAN="3" STYLE="border-bottom: Black 1pt solid; font-weight: bold; text-align: center"><FONT STYLE="font-size: 10pt">Weighted
    Average Exercise Price</FONT></TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD COLSPAN="3"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD COLSPAN="3"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="width: 56%; text-align: left"><FONT STYLE="font-size: 10pt">Outstanding - beginning of year</FONT></TD><TD STYLE="width: 8%"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="width: 1%; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="width: 12%; text-align: right"><FONT STYLE="font-size: 10pt">1,124,410</FONT></TD><TD STYLE="width: 1%; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="width: 8%"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="width: 1%; text-align: left"><FONT STYLE="font-size: 10pt">$</FONT></TD><TD STYLE="width: 12%; text-align: right"><FONT STYLE="font-size: 10pt">0.77</FONT></TD><TD STYLE="width: 1%; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="padding-left: 10pt"><FONT STYLE="font-size: 10pt">Granted</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">&mdash;&nbsp;&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="padding-left: 10pt"><FONT STYLE="font-size: 10pt">Exercised</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">&mdash;&nbsp;&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">$</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">&mdash;&nbsp;&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="padding-bottom: 1pt; padding-left: 10pt"><FONT STYLE="font-size: 10pt">Cancelled/forfeited</FONT></TD><TD STYLE="padding-bottom: 1pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right"><FONT STYLE="font-size: 10pt">&mdash;&nbsp;&nbsp;</FONT></TD><TD STYLE="padding-bottom: 1pt; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="padding-bottom: 1pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left"><FONT STYLE="font-size: 10pt">$</FONT></TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right"><FONT STYLE="font-size: 10pt">&mdash;&nbsp;&nbsp;</FONT></TD><TD STYLE="padding-bottom: 1pt; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="padding-bottom: 2.5pt"><FONT STYLE="font-size: 10pt">Outstanding - June 30, 2020</FONT></TD><TD STYLE="padding-bottom: 2.5pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="border-bottom: Black 2.5pt double; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="border-bottom: Black 2.5pt double; text-align: right"><FONT STYLE="font-size: 10pt">1,124,410</FONT></TD><TD STYLE="padding-bottom: 2.5pt; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="padding-bottom: 2.5pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="border-bottom: Black 2.5pt double; text-align: left"><FONT STYLE="font-size: 10pt">$</FONT></TD><TD STYLE="border-bottom: Black 2.5pt double; text-align: right"><FONT STYLE="font-size: 10pt">0.77</FONT></TD><TD STYLE="padding-bottom: 2.5pt; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="text-align: left; padding-bottom: 2.5pt"><FONT STYLE="font-size: 10pt">Exercisable at June, 30 2020</FONT></TD><TD STYLE="padding-bottom: 2.5pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="border-bottom: Black 2.5pt double; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="border-bottom: Black 2.5pt double; text-align: right"><FONT STYLE="font-size: 10pt">1,124,410</FONT></TD><TD STYLE="padding-bottom: 2.5pt; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="padding-bottom: 2.5pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="border-bottom: Black 2.5pt double; text-align: left"><FONT STYLE="font-size: 10pt">$</FONT></TD><TD STYLE="border-bottom: Black 2.5pt double; text-align: right"><FONT STYLE="font-size: 10pt">0.77</FONT></TD><TD STYLE="padding-bottom: 2.5pt; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="text-align: left; padding-bottom: 2.5pt"><FONT STYLE="font-size: 10pt">Weighted average grant date fair value of
    options during year</FONT></TD><TD STYLE="padding-bottom: 2.5pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="border-bottom: Black 2.5pt double; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="border-bottom: Black 2.5pt double; text-align: right"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;N/A
                                         </FONT></TD><TD STYLE="padding-bottom: 2.5pt; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="padding-bottom: 2.5pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="border-bottom: Black 2.5pt double; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="border-bottom: Black 2.5pt double; text-align: right"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="padding-bottom: 2.5pt; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD><FONT STYLE="font-size: 10pt">Weighted average duration to expiration of outstanding options at June 30, 2020</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">4.8</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD></TR>
</TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><FONT STYLE="font-size: 10pt"><B>Splash Beverage
Group, Inc.</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><FONT STYLE="font-size: 10pt"><B>[f/k/a Canfield
Medical Supply, Inc.]</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B>Notes
to the Condensed Consolidated Financial Statements</B></FONT></P>


<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B><U>Note
8 &ndash; Related Parties</U></B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B>&nbsp;</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><FONT STYLE="font-size: 10pt">During the normal
course of business, we incurred expenses related to services provided by our CEO or Company expenses paid by our CEO, resulting
in related party payables, net of $517,875 as of June 30, 2020. The related party payable to the CEO bears no interest payable
and is due on demand. We also assumed a $50,000 note for the President of WesBev who is the majority shareholder of Splash Beverage
Group, Inc. [Formerly known as Canfield Medical Supply, Inc.].</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">There
are related party notes payable of $0 outstanding as of June 30, 2020 as discussed in Note 4.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B><U>Note
9 &ndash; Investment in Salt Tequila USA, LLC</U></B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B>&nbsp;</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">On
December 9, 2013, we entered into a marketing and distribution agreement with SALT Tequila USA, LLC (&ldquo;SALT&rdquo;) in Mexico
for the manufacturing of our product line. The agreement was for a one-year term with an additional two-year renewal. On December
28, 2015, the agreement was extended through 2020. In the December 9, 2013 agreement, we received a 5% ownership interest in SALT,
12 months after the date of the agreement we received an additional 5% ownership interest in SALT, and 24 months after the date
of the agreement we received an additional 5% interest, resulting in a total interest of 15% in SALT. We have not recorded the
cost of the investment or our share of its results of operations as the amounts are considered immaterial.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">SALT
also has sold product to an unrelated international alcohol distributor, American Spirits Exchange, for preliminary market testing
in 9 of 16 states that they distribute to, that are government-controlled alcohol resellers. In 2019 we had no sales for SALT
Tequila. On December 31, 2018, we created a Mexican subsidiary, Splash MEX SA DE CV (&ldquo;Splash Mex&rdquo;) for the exporting
of SALT Tequila from Mexico to the USA, South and Central Americas. Splash Mex will also act as the manufacturing and distribution
agent of TapouT in Central and South Americas. Applications for the appropriate licenses required for import and wholesale of
alcohol in the USA have been completed for at the Federal and State levels. These licenses will permit direct alcohol sales to
distributors and wholesalers thereby limiting the use of agents for importing SALT Tequila to the USA for distribution.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">On
March 26, 2020, we entered into a new amended stock sale and purchase agreement. The agreement is for $1,000,000 to be paid in
4 tranches of $250,000 and entitles us to additional equity interest in Salt Tequila USA, LLC as follows:</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<TABLE CELLSPACING="0" CELLPADDING="0" STYLE="font: 12pt Times New Roman, Times, Serif; width: 100%">
<TR>
    <TD STYLE="width: 24px"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD>
    <TD STYLE="width: 24px"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&#9679;</FONT></TD>
    <TD STYLE="text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">Tranche 1 &ndash;
    7.5%</FONT></TD></TR>
</TABLE>
<P STYLE="font: 12pt Times New Roman, Times, Serif; margin: 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<TABLE CELLSPACING="0" CELLPADDING="0" STYLE="font: 12pt Times New Roman, Times, Serif; width: 100%">
<TR>
    <TD STYLE="width: 24px"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD>
    <TD STYLE="width: 24px"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&#9679;</FONT></TD>
    <TD STYLE="text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">Tranche 2 &ndash;
    5.0%</FONT></TD></TR>
</TABLE>
<P STYLE="font: 12pt Times New Roman, Times, Serif; margin: 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<TABLE CELLSPACING="0" CELLPADDING="0" STYLE="font: 12pt Times New Roman, Times, Serif; width: 100%">
<TR>
    <TD STYLE="width: 24px"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD>
    <TD STYLE="width: 24px"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&#9679;</FONT></TD>
    <TD STYLE="text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">Tranche 3 &ndash;
    5.0%</FONT></TD></TR>
</TABLE>
<P STYLE="font: 12pt Times New Roman, Times, Serif; margin: 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<TABLE CELLSPACING="0" CELLPADDING="0" STYLE="font: 12pt Times New Roman, Times, Serif; width: 100%">
<TR>
    <TD STYLE="width: 24px"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD>
    <TD STYLE="width: 24px"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&#9679;</FONT></TD>
    <TD STYLE="text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">Tranche 4 &ndash;
    5.0%</FONT></TD></TR>
</TABLE>
<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">Once
all tranches are paid-out we will have a total equity stake of 37.5% of Salt Tequila USA, LLC.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

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    <DIV STYLE="page-break-before: always; margin-top: 6pt; margin-bottom: 6pt"><P STYLE="margin: 0pt">&nbsp;</P></DIV>
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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><FONT STYLE="font-size: 10pt"><B>Splash Beverage
Group, Inc.</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><FONT STYLE="font-size: 10pt"><B>[f/k/a Canfield
Medical Supply, Inc.]</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B>Notes
to the Condensed Consolidated Financial Statements</B></FONT></P>


<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B>&nbsp;</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B><U>Note
10 &ndash; Operating Lease Obligations</U></B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B>&nbsp;</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">Effective
July 2018, we entered into a lease agreement for the right to use and occupy office space. The lease term commenced July 1, 2018
and is scheduled to expire after 36 months, on June 30, 2021.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">Prior
to the current lease, we entered into a lease agreement in 2014 for the right to use and occupy office space. The lease term commenced
November 1, 2014 and was scheduled to expire after 62 months, on March 31, 2020. The lease was terminated in February 2018.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">Effective
November 2019, we entered into a new lease agreement for our NY affiliate. The lease is for six months and will expire on April
30, 2020. This lease was not subjected to the new lease standard, Topic 842.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">Effective
November 2019, we entered into a new lease with Interport Logistics, LLC. The lease term commenced on November 11, 2019 and is
scheduled to expire on November 11, 2020.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">Effective
May 2019, we entered into a new lease in Mexico. The lease commenced May 1, 2019 and is scheduled to expire after 24 months, on
April 1, 2021.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">The
following table presents the discounted present value of minimum lease payments for our office and warehouses to the amounts reported
as financial lease liabilities on the condensed consolidated balance sheet at June 30, 2020:</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">&nbsp;</P>

<TABLE CELLSPACING="0" CELLPADDING="0" STYLE="font: 12pt Times New Roman, Times, Serif; width: 100%; border-collapse: collapse">
<TR STYLE="vertical-align: bottom">
    <TD STYLE="border-bottom: black 1pt solid"><FONT STYLE="font-size: 10pt"><B>Undiscounted Future Minimum Lease Payments</B></FONT></TD>
    <TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="3" STYLE="border-bottom: black 1pt solid; text-align: center"><FONT STYLE="font-size: 10pt"><B>Operating Lease</B></FONT><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD COLSPAN="3">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: #CCEEFF">
    <TD STYLE="width: 71%"><FONT STYLE="font-size: 10pt">2020</FONT></TD>
    <TD STYLE="width: 10%">&nbsp;</TD>
    <TD STYLE="width: 1%"><FONT STYLE="font-size: 10pt">$</FONT></TD>
    <TD STYLE="width: 17%; text-align: right"><FONT STYLE="font-size: 10pt">47,456</FONT></TD>
    <TD STYLE="width: 1%">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: white">
    <TD><FONT STYLE="font-size: 10pt">2021</FONT></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">59,291</FONT></TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: #CCEEFF">
    <TD STYLE="padding-bottom: 1pt"><FONT STYLE="font-size: 10pt">Thereafter</FONT></TD>
    <TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid; text-align: right"><FONT STYLE="font-size: 10pt">29,086</FONT></TD>
    <TD STYLE="padding-bottom: 1pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: white">
    <TD STYLE="padding-left: 10pt"><FONT STYLE="font-size: 10pt">Total</FONT></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">135,832</FONT></TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: #CCEEFF">
    <TD STYLE="padding-bottom: 1pt"><FONT STYLE="font-size: 10pt">Amount representing imputed interest</FONT></TD>
    <TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid; text-align: right"><FONT STYLE="font-size: 10pt">(5,732)</FONT></TD>
    <TD STYLE="padding-bottom: 1pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: white">
    <TD><FONT STYLE="font-size: 10pt">Total operating lease liability</FONT></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">130,101</FONT></TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: #CCEEFF">
    <TD STYLE="padding-bottom: 1pt"><FONT STYLE="font-size: 10pt">Current portion of operating lease liability</FONT></TD>
    <TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid; text-align: right"><FONT STYLE="font-size: 10pt">89,950</FONT></TD>
    <TD STYLE="padding-bottom: 1pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: white">
    <TD STYLE="padding-bottom: 2.5pt; padding-left: 10pt"><FONT STYLE="font-size: 10pt">Operating lease liability, non-current</FONT></TD>
    <TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: black 2.25pt double"><FONT STYLE="font-size: 10pt">$</FONT></TD>
    <TD STYLE="border-bottom: black 2.25pt double; text-align: right"><FONT STYLE="font-size: 10pt">40,151</FONT></TD>
    <TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD></TR>
</TABLE>
<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">The table below presents information for lease
costs related to our operating leases at June 30, 2020:</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">&nbsp;</P>

<TABLE CELLSPACING="0" CELLPADDING="0" STYLE="font: 12pt Times New Roman, Times, Serif; width: 100%; border-collapse: collapse">
<TR STYLE="vertical-align: bottom">
    <TD><FONT STYLE="font-size: 10pt">Operating lease cost:</FONT></TD>
    <TD>&nbsp;</TD>
    <TD COLSPAN="3">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: #CCEEFF">
    <TD STYLE="width: 71%; padding-left: 10pt"><FONT STYLE="font-size: 10pt">Amortization of leased assets</FONT></TD>
    <TD STYLE="width: 10%">&nbsp;</TD>
    <TD STYLE="width: 1%"><FONT STYLE="font-size: 10pt">$</FONT></TD>
    <TD STYLE="width: 17%; text-align: right"><FONT STYLE="font-size: 10pt">87,798</FONT></TD>
    <TD STYLE="width: 1%">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: white">
    <TD STYLE="padding-bottom: 1pt; padding-left: 10pt"><FONT STYLE="font-size: 10pt">Interest of lease liabilities</FONT></TD>
    <TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid; text-align: right"><FONT STYLE="font-size: 10pt">9,180</FONT></TD>
    <TD STYLE="padding-bottom: 1pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: #CCEEFF">
    <TD STYLE="padding-bottom: 2.5pt; padding-left: 20pt"><FONT STYLE="font-size: 10pt">Total operating lease cost</FONT></TD>
    <TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: black 2.25pt double"><FONT STYLE="font-size: 10pt">$</FONT></TD>
    <TD STYLE="border-bottom: black 2.25pt double; text-align: right"><FONT STYLE="font-size: 10pt">96,978</FONT></TD>
    <TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD></TR>
</TABLE>
<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">The table below presents lease-related terms
and discount rates at June 30, 2020:</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">&nbsp;</P>

<TABLE CELLSPACING="0" CELLPADDING="0" STYLE="font: 12pt Times New Roman, Times, Serif; width: 100%; border-collapse: collapse">
<TR STYLE="vertical-align: bottom">
    <TD><FONT STYLE="font-size: 10pt">Remaining term on leases</FONT></TD>
    <TD>&nbsp;</TD>
    <TD COLSPAN="3" STYLE="text-align: center"><FONT STYLE="font-size: 10pt">10 to 28 months</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: #CCEEFF">
    <TD STYLE="width: 71%"><FONT STYLE="font-size: 10pt">Incremented borrowing rate</FONT></TD>
    <TD STYLE="width: 10%">&nbsp;</TD>
    <TD STYLE="width: 1%">&nbsp;</TD>
    <TD STYLE="width: 17%; text-align: right"><FONT STYLE="font-size: 10pt">5.0</FONT></TD>
    <TD STYLE="width: 1%"><FONT STYLE="font-size: 10pt">%</FONT></TD></TR>
</TABLE>




<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

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    <DIV STYLE="page-break-before: always; margin-top: 6pt; margin-bottom: 6pt"><P STYLE="margin: 0pt">&nbsp;</P></DIV>
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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><FONT STYLE="font-size: 10pt"><B>Splash Beverage
Group, Inc.</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><FONT STYLE="font-size: 10pt"><B>[f/k/a Canfield
Medical Supply, Inc.]</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B>Notes
to the Condensed Consolidated Financial Statements</B></FONT></P>


<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 12pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B><U>Note
11 &ndash; Line of Credit</U></B>&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B>&nbsp;</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">At
June 30, 2020 SBG owed $68,000 to a financial institution under a revolving line of credit which is classified within other current
liabilities. The line of credit is secured by the assets of SBG is due on demand, and bears interest at variable rates approximately
6.1% at June 30, 2020. Interest expense under the note was approximately $900 during the three months ended June 30, 2020. Interest
expense under the note was approximately $2,000 during the six months ended June 30, 2020.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B>&nbsp;</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B><U>Note
12 &ndash; PPP Loan</U></B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt/13pt Kalinga,sans-serif; margin: 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">On
January 30, 2020, the World Health Organization (&ldquo;WHO&rdquo;) announced a global health emergency because of a new strain
of coronavirus originating in Wuhan, China (the &ldquo;COVID-19 outbreak&rdquo;) and the risks to the international community
as the virus spreads globally beyond the point of origin. On March 20, 2020, the WHO classified the COVID-19 outbreak as a pandemic,
based on the rapid increase in exposure globally.</FONT></P>

<P STYLE="font: 10pt Kalinga,sans-serif; margin: 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Kalinga,sans-serif; margin: 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">In
response to the COVID-19 outbreak in the United States, the CARES Act (the &ldquo;Act&rdquo;) was passed by Congress
and signed into law on March 27, 2020. In connection with the CARES Act, the Company and its subsidiary applied for and
received  loans with an original aggregate principal balance of approximately $158,000. These loans and interest will be
forgiven as long as the funds are used for qualifying expenditures as outlined in the Act. The loans bear interest at 1%,
with an 18 month term, and has a 6-month initial payment deferral.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B><U>Note
13 &ndash; Business Combinations</U></B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B>&nbsp;</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">As
stated in Note 1, we consummated the merger of SBG on March 31, 2020 which was accounted for as a reverse merger.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">The
value of our merger was approximately $9.2 million based on the valuation of the SBG equity on the date of consummation.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">The
following summarizes our allocation of the purchase price for the acquisition:</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<TABLE CELLSPACING="0" CELLPADDING="0" STYLE="font: 12pt Times New Roman, Times, Serif; width: 100%; border-collapse: collapse">
<TR STYLE="vertical-align: bottom; background-color: #CCEEFF">
    <TD STYLE="width: 71%"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">Cash and cash equivalents</FONT></TD>
    <TD STYLE="width: 10%"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD>
    <TD STYLE="width: 1%"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">$</FONT></TD>
    <TD STYLE="width: 17%; text-align: right"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">72,442</FONT></TD>
    <TD STYLE="width: 1%"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: white">
    <TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif">Accounts receivable</FONT></TD>
    <TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD>
    <TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif">$</FONT></TD>
    <TD STYLE="text-align: right"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">311,586</FONT></TD>
    <TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: #CCEEFF">
    <TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif">Inventory</FONT></TD>
    <TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD>
    <TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif">$</FONT></TD>
    <TD STYLE="text-align: right"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">21,415</FONT></TD>
    <TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: white">
    <TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif">Property and equipment</FONT></TD>
    <TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD>
    <TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif">$</FONT></TD>
    <TD STYLE="text-align: right"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">38,110</FONT></TD>
    <TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: #CCEEFF">
    <TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif">Goodwill</FONT></TD>
    <TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD>
    <TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif">$</FONT></TD>
    <TD STYLE="text-align: right"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">9,448,832</FONT></TD>
    <TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: white">
    <TD STYLE="padding-bottom: 1pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">Accounts payable,
    accrued expenses and other liabilities</FONT></TD>
    <TD STYLE="padding-bottom: 1pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD>
    <TD STYLE="border-bottom: black 1pt solid"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">$</FONT></TD>
    <TD STYLE="border-bottom: black 1pt solid; text-align: right"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">719,221</FONT></TD>
    <TD STYLE="padding-bottom: 1pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: #CCEEFF">
    <TD STYLE="padding-bottom: 2.5pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">Purchase price</FONT></TD>
    <TD STYLE="padding-bottom: 2.5pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD>
    <TD STYLE="border-bottom: black 2.25pt double"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">$</FONT></TD>
    <TD STYLE="border-bottom: black 2.25pt double; text-align: right"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">9,173,164</FONT></TD>
    <TD STYLE="padding-bottom: 2.5pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD></TR>
</TABLE>
<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B><U>Note
14 &ndash; Segment Reporting</U></B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">The
Company evaluates segment reporting in accordance with the FASB Accounting Standards Codification Topic 280, Segment Reporting,
each reporting period, including evaluating the reporting package reviewed by&nbsp;the Chief Executive Officer and Chief Financial
Officer.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"></P>


<TABLE CELLSPACING="0" CELLPADDING="0" STYLE="font: 12pt Times New Roman, Times, Serif; width: 100%; border-collapse: collapse">
<TR STYLE="vertical-align: bottom">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD COLSPAN="7" STYLE="text-align: center"><FONT STYLE="font-size: 10pt">Three-Months Ending</FONT></TD>
    <TD>&nbsp;</TD>
    <TD COLSPAN="7" STYLE="text-align: center"><FONT STYLE="font-size: 10pt">Six-Months Ending</FONT></TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD STYLE="border-bottom: black 1pt solid"><FONT STYLE="font-size: 10pt"><B>Revenue</B></FONT></TD>
    <TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="3" STYLE="border-bottom: black 1pt solid; text-align: center"><FONT STYLE="font-size: 10pt">Q2 2020</FONT></TD>
    <TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="3" STYLE="border-bottom: black 1pt solid; text-align: center"><FONT STYLE="font-size: 10pt">Q2 2019</FONT></TD>
    <TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="3" STYLE="border-bottom: black 1pt solid; text-align: center"><FONT STYLE="font-size: 10pt">Q2 2020</FONT></TD>
    <TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="3" STYLE="border-bottom: black 1pt solid; text-align: center"><FONT STYLE="font-size: 10pt">Q2 2019</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: #CCEEFF">
    <TD STYLE="width: 52%"><FONT STYLE="font-size: 10pt">Beverages</FONT></TD>
    <TD STYLE="width: 1%">&nbsp;</TD>
    <TD STYLE="width: 1%">&nbsp;</TD>
    <TD STYLE="width: 9%; text-align: right"><FONT STYLE="font-size: 10pt">412,729</FONT></TD>
    <TD STYLE="width: 1%">&nbsp;</TD>
    <TD STYLE="width: 1%">&nbsp;</TD>
    <TD STYLE="width: 1%">&nbsp;</TD>
    <TD STYLE="width: 9%; text-align: right"><FONT STYLE="font-size: 10pt">42,775</FONT></TD>
    <TD STYLE="width: 1%">&nbsp;</TD>
    <TD STYLE="width: 1%">&nbsp;</TD>
    <TD STYLE="width: 1%">&nbsp;</TD>
    <TD STYLE="width: 9%; text-align: right"><FONT STYLE="font-size: 10pt">524,732</FONT></TD>
    <TD STYLE="width: 1%">&nbsp;</TD>
    <TD STYLE="width: 1%">&nbsp;</TD>
    <TD STYLE="width: 1%">&nbsp;</TD>
    <TD STYLE="width: 9%; text-align: right"><FONT STYLE="font-size: 10pt">48,105</FONT></TD>
    <TD STYLE="width: 1%">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: white">
    <TD><FONT STYLE="font-size: 10pt">Medical Devices</FONT></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">199,579</FONT></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">&mdash;&nbsp;&nbsp;</FONT></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">199,579</FONT></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">&mdash;&nbsp;&nbsp;</FONT></TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: #CCEEFF">
    <TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid; text-align: right">&nbsp;</TD>
    <TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid; text-align: right">&nbsp;</TD>
    <TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid; text-align: right">&nbsp;</TD>
    <TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid; text-align: right">&nbsp;</TD>
    <TD STYLE="padding-bottom: 1pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: white">
    <TD STYLE="padding-bottom: 2.5pt"><FONT STYLE="font-size: 10pt">Total Revenues</FONT></TD>
    <TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: black 2.25pt double">&nbsp;</TD>
    <TD STYLE="border-bottom: black 2.25pt double; text-align: right"><FONT STYLE="font-size: 10pt">612,308</FONT></TD>
    <TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: black 2.25pt double">&nbsp;</TD>
    <TD STYLE="border-bottom: black 2.25pt double; text-align: right"><FONT STYLE="font-size: 10pt">42,775</FONT></TD>
    <TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: black 2.25pt double">&nbsp;</TD>
    <TD STYLE="border-bottom: black 2.25pt double; text-align: right"><FONT STYLE="font-size: 10pt">724,311</FONT></TD>
    <TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: black 2.25pt double">&nbsp;</TD>
    <TD STYLE="border-bottom: black 2.25pt double; text-align: right"><FONT STYLE="font-size: 10pt">48,105</FONT></TD>
    <TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: #CCEEFF">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">&nbsp;</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: white">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">&nbsp;</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: white">
    <TD STYLE="padding-bottom: 1pt"><FONT STYLE="font-size: 10pt"><B><U>Total assets</U></B></FONT></TD>
    <TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid; text-align: center"><FONT STYLE="font-size: 10pt">June 2020</FONT></TD>
    <TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid; text-align: center"><FONT STYLE="font-size: 10pt">December 2019</FONT></TD>
    <TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">&nbsp;</TD>
    <TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">&nbsp;</TD>
    <TD STYLE="padding-bottom: 1pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: #CCEEFF">
    <TD><FONT STYLE="font-size: 10pt">Beverages</FONT></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">1,172,224</FONT></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">605,314</FONT></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">&nbsp;</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: white">
    <TD><FONT STYLE="font-size: 10pt">Medical Devices</FONT></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">9,763,660</FONT></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">&mdash;&nbsp;&nbsp;</FONT></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">&nbsp;</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: #CCEEFF">
    <TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid; text-align: right">&nbsp;</TD>
    <TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid; text-align: right">&nbsp;</TD>
    <TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">&nbsp;</TD>
    <TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">&nbsp;</TD>
    <TD STYLE="padding-bottom: 1pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: white">
    <TD STYLE="padding-bottom: 2.5pt"><FONT STYLE="font-size: 10pt">Total Assets</FONT></TD>
    <TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: black 2.25pt double">&nbsp;</TD>
    <TD STYLE="border-bottom: black 2.25pt double; text-align: right"><FONT STYLE="font-size: 10pt">10,935,884</FONT></TD>
    <TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: black 2.25pt double">&nbsp;</TD>
    <TD STYLE="border-bottom: black 2.25pt double; text-align: right"><FONT STYLE="font-size: 10pt">605,314</FONT></TD>
    <TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">&nbsp;</TD>
    <TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">&nbsp;</TD>
    <TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD></TR>
</TABLE>
<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B><U>Note
15 &ndash; Commitment and Contingencies</U></B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B>&nbsp;</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">We
are a party to asserted claims and are subject to regulatory actions in the ordinary course of business. The results of such proceedings
cannot be predicted with certainty, but we do not anticipate that the outcome, if any, arising out of any such matter will have
a material adverse effect on its business, financial condition or results of operations.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B><I><U>Capital
Raise</U></I></B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">In
connection with the merger we are committed to our previous preferred stock and debt holders to raise $9 million in a secondary
IPO, as defined in the agreements.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B><I><U>Stock
Price Guarantee</U></I></B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">We
have a commitment to issue additional shares associated with specific stock price guarantee granted to an investor. See Note 4.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 12pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B><U>Note
16 &ndash; Subsequent Events</U></B>&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><B><I><U>Private Placement Memorandum (PPM)</U></I></B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; text-align: justify; margin-right: 0; margin-left: 0">Our Board of Directors
has determined that it is in the best interests of the Corporation and its stockholders to obtain working capital by conducting
a private placement offering of 2,727,272 shares of the common stock of the Company, no par value per share at a purchase price
of $1.10 per share for aggregate gross proceeds of $3,000,000. As part of the PPM, each common share holds one-half warrant. As
of August 14, 2020 the company has not sold any shares.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><B><I><U>Company Name Change</U></I></B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><B><I>&nbsp;</I></B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">In July 2020, we filed a Certificate of Amendment
of Articles of Incorporation to change our name to Splash Beverage Group Inc. On July 31, 2020, we received approval from FINRA
regarding our name change.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B><I>&nbsp;</I></B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B><I><U>New
Stock Issuance</U></I></B>&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 12pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">On
July 1, 2020, we enter a subscription agreement with one of our existing shareholders for $110,000 in exchange for
100,000 of our common stock at $1.10 per share. As part of the agreement we granted 325,000 warrants at a purchase price of $0.25
per warrant.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 12pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">On
July 8, 2020, we enter a subscription agreement with one of our existing shareholders for $500,000 in exchange for 454,546
of our common stock at $1.10 per share. As part of the agreement we granted 554,546&nbsp;warrants.</FONT></P>

<P STYLE="font: 12pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>



<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"></P>

<P STYLE="font: 12pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></P>





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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>







<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0"><FONT STYLE="font-size: 10pt"><B>&nbsp;</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; text-align: center; margin-right: 0; margin-bottom: 9pt; margin-left: 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B><U>UNAUDITED
PRO FORMA CONSOLIDATED FINANCIAL STATEMENTS</U></B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; text-align: justify; margin-right: 0; margin-bottom: 9.75pt; margin-left: 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">The
following unaudited pro forma consolidated financial statement gives effect to the Merger Agreement transaction (the &quot;Merger
Agreement&quot;) between Canfield Medical Supply, Inc. (&ldquo;CMS&rdquo;) and Splash Beverage Group, Inc. (&quot;SBG&quot;).
In the Merger Agreement, CMS issued 54,677,690 shares of its common stock to the shareholders of SBG in exchange for all of the
issued and outstanding common shares of SBG, which resulted in SBG becoming a wholly-owned subsidiary of CMS. CMS also issued
warrants to acquire 6,024,174 shares of its common stock to existing SBG warrant holders. As owners and management of SBG have
voting and operating control of CMS following the Merger Agreement, the transaction is accounted for as a reverse acquisition.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; text-align: justify; margin-right: 0; margin-bottom: 9.75pt; margin-left: 0">The
unaudited pro forma consolidated financial statements presented below are prepared by applying the acquisition method of accounting
to a business combination that is a reverse acquisition. Pro forma adjustments which give effect to certain transactions occurring
as a direct result of the Merger Agreement are described in the accompanying unaudited notes presented on the following page.
The accompanying unaudited pro forma consolidated statement of operations for the year ended December 31, 2019 presents the combined
results of operations as if the Reverse Acquisition had occurred on January 1, 2019 in addition to, the consolidated statement
of operations for the six-months ending June 30, 2020.&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; text-align: justify; margin-right: 0; margin-bottom: 9.75pt; margin-left: 0">These
unaudited pro forma consolidated financial statements are presented for illustrative purposes only and are not necessarily indicative
of the consolidated financial position or results of operations in future periods or the results that actually would have been
realized had CMS and SBG been a combined company during the specified periods. The unaudited pro forma consolidated financial
statements, including the notes thereto, are qualified in their entirety by reference to, and should be read in conjunction with,
SBG's audited financial statements at and for the years ended December 31, 2019 and 2018, SBG&rsquo;s Q2 2020 Form 10-Q and CMS's
audited financial statements for the years ended December 31, 2019 and 2018, as included in herein for the year ended December
31, 2019.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><FONT STYLE="font-size: 10pt"><B>&nbsp;</B></FONT></P>

<P STYLE="font: 12pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"></FONT></P>



<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"></P>

<P STYLE="font: 12pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></P>





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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B>&nbsp;</B></FONT></P>




<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B></B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; text-align: center; margin-top: 0; margin-bottom: 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B>Splash
Beverage Group, Inc.</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; text-align: center; margin-top: 0; margin-bottom: 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B>2019 Proforma Condensed Statement of Operations</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; text-align: center; margin-top: 0; margin-bottom: 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B>(UNAUDITED)&nbsp;</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"></FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: 11pt Calibri, Helvetica, Sans-Serif; border-collapse: collapse; width: 100%">
<TR STYLE="vertical-align: bottom">
    <TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD>
    <TD COLSPAN="3"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD>
    <TD COLSPAN="3"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="color: red; font-weight: bold"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD>
    <TD COLSPAN="3" STYLE="vertical-align: bottom; color: red; font-weight: bold; text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD>
    <TD COLSPAN="3"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD>
    <TD COLSPAN="3" STYLE="text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">Pro Forma</FONT></TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD>
    <TD COLSPAN="3"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD>
    <TD COLSPAN="3"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="color: red; font-weight: bold"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD>
    <TD COLSPAN="3" STYLE="vertical-align: bottom; color: red; font-weight: bold; text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD>
    <TD COLSPAN="3" STYLE="text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">Pro Forma</FONT></TD><TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD>
    <TD COLSPAN="3" STYLE="text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">Condensed</FONT></TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="padding-bottom: 1pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD>
    <TD COLSPAN="3" STYLE="border-bottom: Black 1pt solid; text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">Splash</FONT></TD><TD STYLE="padding-bottom: 1pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD>
    <TD COLSPAN="3" STYLE="border-bottom: Black 1pt solid; text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">Canfield</FONT></TD><TD STYLE="color: red; font-weight: bold; padding-bottom: 1pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD>
    <TD COLSPAN="3" STYLE="vertical-align: bottom; color: red; font-weight: bold; text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="padding-bottom: 1pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD>
    <TD COLSPAN="3" STYLE="border-bottom: Black 1pt solid; text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">Adjustments</FONT></TD><TD STYLE="padding-bottom: 1pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD>
    <TD COLSPAN="3" STYLE="border-bottom: Black 1pt solid; text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">Consolidated</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="width: 35%"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">Revenues</FONT></TD><TD STYLE="width: 2%"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD>
    <TD STYLE="width: 1%; text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="width: 9%; text-align: right"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">20,387</FONT></TD><TD STYLE="width: 1%; text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="width: 2%"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD>
    <TD STYLE="width: 1%; text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="width: 9%; text-align: right"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">1,017,833</FONT></TD><TD STYLE="width: 1%; text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="width: 2%; color: red; font-weight: bold"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom; width: 1%; color: red; font-weight: bold; text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="vertical-align: bottom; width: 9%; color: red; font-weight: bold; text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="vertical-align: bottom; width: 1%; color: red; font-weight: bold; text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="width: 2%"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD>
    <TD STYLE="width: 1%; text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="width: 9%; text-align: right"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&mdash;&nbsp;&nbsp;</FONT></TD><TD STYLE="width: 1%; text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="width: 2%"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD>
    <TD STYLE="width: 1%; text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="width: 9%; text-align: right"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">1,038,220</FONT></TD><TD STYLE="width: 1%; text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="color: red; font-weight: bold"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom; color: red; font-weight: bold; text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="vertical-align: bottom; color: red; font-weight: bold; text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="vertical-align: bottom; color: red; font-weight: bold; text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="padding-bottom: 2.5pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">Cost of Sales</FONT></TD><TD STYLE="padding-bottom: 2.5pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD>
    <TD STYLE="border-bottom: Black 2.5pt double; text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="border-bottom: Black 2.5pt double; text-align: right"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">(245,500</FONT></TD><TD STYLE="padding-bottom: 2.5pt; text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">)</FONT></TD><TD STYLE="padding-bottom: 2.5pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD>
    <TD STYLE="border-bottom: Black 2.5pt double; text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="border-bottom: Black 2.5pt double; text-align: right"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">(508,874</FONT></TD><TD STYLE="padding-bottom: 2.5pt; text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">)</FONT></TD><TD STYLE="color: red; font-weight: bold; padding-bottom: 2.5pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom; color: red; font-weight: bold; text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="vertical-align: bottom; color: red; font-weight: bold; text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="vertical-align: bottom; padding-bottom: 2.5pt; color: red; font-weight: bold; text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="padding-bottom: 2.5pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD>
    <TD STYLE="border-bottom: Black 2.5pt double; text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="border-bottom: Black 2.5pt double; text-align: right"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&mdash;&nbsp;&nbsp;</FONT></TD><TD STYLE="padding-bottom: 2.5pt; text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="padding-bottom: 2.5pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD>
    <TD STYLE="border-bottom: Black 2.5pt double; text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="border-bottom: Black 2.5pt double; text-align: right"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">(754,374</FONT></TD><TD STYLE="padding-bottom: 2.5pt; text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">)</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="color: red; font-weight: bold"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom; color: red; font-weight: bold; text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="vertical-align: bottom; color: red; font-weight: bold; text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="vertical-align: bottom; color: red; font-weight: bold; text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">Gross Margin</FONT></TD><TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">(225,113</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">)</FONT></TD><TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">508,959</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="color: red; font-weight: bold"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom; color: red; font-weight: bold; text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="vertical-align: bottom; color: red; font-weight: bold; text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="vertical-align: bottom; color: red; font-weight: bold; text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&mdash;&nbsp;&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">283,846</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="color: red; font-weight: bold"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom; color: red; font-weight: bold; text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="vertical-align: bottom; color: red; font-weight: bold; text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="vertical-align: bottom; color: red; font-weight: bold; text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="text-align: left; padding-bottom: 2.5pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">Operating
    Expenses</FONT></TD><TD STYLE="padding-bottom: 2.5pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD>
    <TD STYLE="border-bottom: Black 2.5pt double; text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="border-bottom: Black 2.5pt double; text-align: right"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">4,261,946</FONT></TD><TD STYLE="padding-bottom: 2.5pt; text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="padding-bottom: 2.5pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD>
    <TD STYLE="border-bottom: Black 2.5pt double; text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="border-bottom: Black 2.5pt double; text-align: right"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">979,355</FONT></TD><TD STYLE="padding-bottom: 2.5pt; text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="color: red; font-weight: bold; padding-bottom: 2.5pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom; color: red; font-weight: bold; text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="vertical-align: bottom; color: red; font-weight: bold; text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="vertical-align: bottom; padding-bottom: 2.5pt; color: red; font-weight: bold; text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="padding-bottom: 2.5pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD>
    <TD STYLE="border-bottom: Black 2.5pt double; text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="border-bottom: Black 2.5pt double; text-align: right"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&mdash;&nbsp;&nbsp;</FONT></TD><TD STYLE="padding-bottom: 2.5pt; text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="padding-bottom: 2.5pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD>
    <TD STYLE="border-bottom: Black 2.5pt double; text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="border-bottom: Black 2.5pt double; text-align: right"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">5,241,301</FONT></TD><TD STYLE="padding-bottom: 2.5pt; text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="color: red; font-weight: bold"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom; color: red; font-weight: bold; text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="vertical-align: bottom; color: red; font-weight: bold; text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="vertical-align: bottom; color: red; font-weight: bold; text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">Loss from Operations</FONT></TD><TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">(4,487,059</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">)</FONT></TD><TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">(470,396</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">)</FONT></TD><TD STYLE="color: red; font-weight: bold"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom; color: red; font-weight: bold; text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="vertical-align: bottom; color: red; font-weight: bold; text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="vertical-align: bottom; color: red; font-weight: bold; text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&mdash;&nbsp;&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">(4,957,455</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">)</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="color: red; font-weight: bold"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom; color: red; font-weight: bold; text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="vertical-align: bottom; color: red; font-weight: bold; text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="vertical-align: bottom; color: red; font-weight: bold; text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">Interest Expense</FONT></TD><TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">(665,195</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">)</FONT></TD><TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">(8,376</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">)</FONT></TD><TD STYLE="color: red; font-weight: bold"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom; color: red; font-weight: bold; text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="vertical-align: bottom; color: red; font-weight: bold; text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">(a)</FONT></TD><TD STYLE="vertical-align: bottom; color: red; font-weight: bold; text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">584,830</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">(88,741</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">)</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">Other Income (Expense)</FONT></TD><TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">16,523</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">1,538</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="color: red; font-weight: bold"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom; color: red; font-weight: bold; text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="vertical-align: bottom; color: red; font-weight: bold; text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="vertical-align: bottom; color: red; font-weight: bold; text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">18,061</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="padding-bottom: 1pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="padding-bottom: 1pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="padding-bottom: 1pt; text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="padding-bottom: 1pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="padding-bottom: 1pt; text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="color: red; font-weight: bold; padding-bottom: 1pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom; color: red; font-weight: bold; text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="vertical-align: bottom; color: red; font-weight: bold; text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="vertical-align: bottom; padding-bottom: 1pt; color: red; font-weight: bold; text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="padding-bottom: 1pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="padding-bottom: 1pt; text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="padding-bottom: 1pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="padding-bottom: 1pt; text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; padding-bottom: 1pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">Net
    Loss</FONT></TD><TD STYLE="padding-bottom: 1pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">(5,135,731</FONT></TD><TD STYLE="padding-bottom: 1pt; text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">)</FONT></TD><TD STYLE="padding-bottom: 1pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">(477,234</FONT></TD><TD STYLE="padding-bottom: 1pt; text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">)</FONT></TD><TD STYLE="color: red; font-weight: bold; padding-bottom: 1pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom; color: red; font-weight: bold; text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="vertical-align: bottom; color: red; font-weight: bold; text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="vertical-align: bottom; padding-bottom: 1pt; color: red; font-weight: bold; text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="padding-bottom: 1pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">584,830</FONT></TD><TD STYLE="padding-bottom: 1pt; text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="padding-bottom: 1pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">(5,028,135</FONT></TD><TD STYLE="padding-bottom: 1pt; text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">)</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="color: red; font-weight: bold"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom; color: red; font-weight: bold; text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="vertical-align: bottom; color: red; font-weight: bold; text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="vertical-align: bottom; color: red; font-weight: bold; text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10.5pt; font-weight: bold; padding-bottom: 2.5pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">Net
    loss per share</FONT></TD><TD STYLE="padding-bottom: 2.5pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="padding-bottom: 2.5pt; text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="padding-bottom: 2.5pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="padding-bottom: 2.5pt; text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="color: red; font-weight: bold; padding-bottom: 2.5pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom; color: red; font-weight: bold; text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="vertical-align: bottom; color: red; font-weight: bold; text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="vertical-align: bottom; padding-bottom: 2.5pt; color: red; font-weight: bold; text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="padding-bottom: 2.5pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="padding-bottom: 2.5pt; text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="padding-bottom: 2.5pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD>
    <TD STYLE="border-bottom: Black 2.5pt double; text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="border-bottom: Black 2.5pt double; text-align: right"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">(0.12</FONT></TD><TD STYLE="padding-bottom: 2.5pt; text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">)</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="color: red; font-weight: bold"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom; color: red; font-weight: bold; text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="vertical-align: bottom; color: red; font-weight: bold; text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="vertical-align: bottom; color: red; font-weight: bold; text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-weight: bold"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">Pro forma weighted</FONT></TD><TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="color: red; font-weight: bold"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom; color: red; font-weight: bold; text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="vertical-align: bottom; color: red; font-weight: bold; text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="vertical-align: bottom; color: red; font-weight: bold; text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-weight: bold; padding-bottom: 2.5pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">average
    shares outstanding</FONT></TD><TD STYLE="padding-bottom: 2.5pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="padding-bottom: 2.5pt; text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="padding-bottom: 2.5pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="padding-bottom: 2.5pt; text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="color: red; font-weight: bold; padding-bottom: 2.5pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom; color: red; font-weight: bold; text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="vertical-align: bottom; color: red; font-weight: bold; text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="vertical-align: bottom; padding-bottom: 2.5pt; color: red; font-weight: bold; text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="padding-bottom: 2.5pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="padding-bottom: 2.5pt; text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="padding-bottom: 2.5pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD>
    <TD STYLE="border-bottom: Black 2.5pt double; text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="border-bottom: Black 2.5pt double; text-align: right"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">42,154,947</FONT></TD><TD STYLE="padding-bottom: 2.5pt; text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD></TR>
</TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT><B>&nbsp;</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><FONT STYLE="color: Red">(a)</FONT> To
reverse interest expense on notes payable which were converted to Common stock concurrently with the Merger Agreement</P>

<P STYLE="font: 12pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><FONT STYLE="font-size: 10pt"></FONT></P>

<P STYLE="font: 12pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></P>





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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>
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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B></B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; text-align: center; margin-top: 0; margin-bottom: 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B>Splash
Beverage Group, Inc.</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; text-align: center; margin-top: 0; margin-bottom: 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B>June
30, 2020 Proforma Condensed Statement of Operations</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; text-align: center; margin-top: 0; margin-bottom: 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B>(UNAUDITED)&nbsp;</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; text-align: center; margin-top: 0; margin-bottom: 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B>&nbsp;</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; text-align: center; margin-top: 0; margin-bottom: 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B></B></FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: 11pt Calibri, Helvetica, Sans-Serif; border-collapse: collapse; width: 100%">
<TR STYLE="vertical-align: bottom">
    <TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD>
    <TD COLSPAN="3"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD>
    <TD STYLE="text-align: center; vertical-align: bottom"><FONT STYLE="font: 10pt Times New Roman, Times, Serif; color: Red">&nbsp;</FONT></TD>
    <TD COLSPAN="3"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="color: red; font-weight: bold"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD>
    <TD COLSPAN="3" STYLE="vertical-align: bottom; color: red; font-weight: bold; text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD>
    <TD COLSPAN="3"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD>
    <TD COLSPAN="3" STYLE="text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">Pro Forma</FONT></TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD>
    <TD COLSPAN="3"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD>
    <TD STYLE="text-align: center; vertical-align: bottom"><FONT STYLE="font: 10pt Times New Roman, Times, Serif; color: Red">&nbsp;</FONT></TD>
    <TD COLSPAN="3"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="color: red; font-weight: bold"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD>
    <TD COLSPAN="3" STYLE="vertical-align: bottom; color: red; font-weight: bold; text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD>
    <TD COLSPAN="3" STYLE="text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">Pro Forma</FONT></TD><TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD>
    <TD COLSPAN="3" STYLE="text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">Condensed</FONT></TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="padding-bottom: 1pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD>
    <TD COLSPAN="3" STYLE="border-bottom: Black 1pt solid; text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">Splash</FONT></TD><TD STYLE="padding-bottom: 1pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD>
    <TD STYLE="text-align: center; vertical-align: bottom"><FONT STYLE="font: 10pt Times New Roman, Times, Serif; color: Red">&nbsp;</FONT></TD>
    <TD COLSPAN="3" STYLE="border-bottom: Black 1pt solid; text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">Canfield</FONT></TD><TD STYLE="color: red; font-weight: bold; padding-bottom: 1pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD>
    <TD COLSPAN="3" STYLE="vertical-align: bottom; color: red; font-weight: bold; text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="padding-bottom: 1pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD>
    <TD COLSPAN="3" STYLE="border-bottom: Black 1pt solid; text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">Adjustments</FONT></TD><TD STYLE="padding-bottom: 1pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD>
    <TD COLSPAN="3" STYLE="border-bottom: Black 1pt solid; text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">Consolidated</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="width: 36%"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">Revenues</FONT></TD><TD STYLE="width: 1%"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD>
    <TD STYLE="width: 1%; text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="width: 8%; text-align: right"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">724,311</FONT></TD><TD STYLE="width: 1%; text-align: left"></TD><TD STYLE="width: 1%"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD>
    <TD STYLE="text-align: center; width: 9%; vertical-align: bottom"><FONT STYLE="font: 10pt Times New Roman, Times, Serif; color: Red">(a)</FONT></TD>
    <TD STYLE="width: 1%; text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="width: 8%; text-align: right"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">175,273</FONT></TD><TD STYLE="width: 1%; text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="width: 1%; color: red; font-weight: bold"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom; width: 1%; color: red; font-weight: bold; text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="vertical-align: bottom; width: 8%; color: red; font-weight: bold; text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="vertical-align: bottom; width: 1%; color: red; font-weight: bold; text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="width: 1%"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD>
    <TD STYLE="width: 1%; text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="width: 8%; text-align: right"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&mdash;&nbsp;&nbsp;</FONT></TD><TD STYLE="width: 1%; text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="width: 1%"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD>
    <TD STYLE="width: 1%; text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="width: 8%; text-align: right"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">899,584</FONT></TD><TD STYLE="width: 1%; text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD>
    <TD STYLE="text-align: center; vertical-align: bottom"><FONT STYLE="font: 10pt Times New Roman, Times, Serif; color: Red">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="color: red; font-weight: bold"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom; color: red; font-weight: bold; text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="vertical-align: bottom; color: red; font-weight: bold; text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="vertical-align: bottom; color: red; font-weight: bold; text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="padding-bottom: 2.5pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">Cost of Sales</FONT></TD><TD STYLE="padding-bottom: 2.5pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD>
    <TD STYLE="border-bottom: Black 2.5pt double; text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="border-bottom: Black 2.5pt double; text-align: right"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">(394,987</FONT></TD><TD STYLE="padding-bottom: 2.5pt; text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">)</FONT></TD><TD STYLE="padding-bottom: 2.5pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD>
    <TD STYLE="text-align: center; vertical-align: bottom"><FONT STYLE="font: 10pt Times New Roman, Times, Serif; color: Red">(a)</FONT></TD>
    <TD STYLE="border-bottom: Black 2.5pt double; text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="border-bottom: Black 2.5pt double; text-align: right"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">(105,964</FONT></TD><TD STYLE="padding-bottom: 2.5pt; text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">)</FONT></TD><TD STYLE="color: red; font-weight: bold; padding-bottom: 2.5pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom; color: red; font-weight: bold; text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="vertical-align: bottom; color: red; font-weight: bold; text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="vertical-align: bottom; padding-bottom: 2.5pt; color: red; font-weight: bold; text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="padding-bottom: 2.5pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD>
    <TD STYLE="border-bottom: Black 2.5pt double; text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="border-bottom: Black 2.5pt double; text-align: right"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&mdash;&nbsp;&nbsp;</FONT></TD><TD STYLE="padding-bottom: 2.5pt; text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="padding-bottom: 2.5pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD>
    <TD STYLE="border-bottom: Black 2.5pt double; text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="border-bottom: Black 2.5pt double; text-align: right"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">(500,951</FONT></TD><TD STYLE="padding-bottom: 2.5pt; text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">)</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD>
    <TD STYLE="text-align: center; vertical-align: bottom"><FONT STYLE="font: 10pt Times New Roman, Times, Serif; color: Red">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="color: red; font-weight: bold"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom; color: red; font-weight: bold; text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="vertical-align: bottom; color: red; font-weight: bold; text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="vertical-align: bottom; color: red; font-weight: bold; text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">Gross Margin</FONT></TD><TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">329,324</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD>
    <TD STYLE="text-align: center; vertical-align: bottom"><FONT STYLE="font: 10pt Times New Roman, Times, Serif; color: Red">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">69,309</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="color: red; font-weight: bold"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom; color: red; font-weight: bold; text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="vertical-align: bottom; color: red; font-weight: bold; text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="vertical-align: bottom; color: red; font-weight: bold; text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&mdash;&nbsp;&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">398,633</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD>
    <TD STYLE="text-align: center; vertical-align: bottom"><FONT STYLE="font: 10pt Times New Roman, Times, Serif; color: Red">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="color: red; font-weight: bold"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom; color: red; font-weight: bold; text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="vertical-align: bottom; color: red; font-weight: bold; text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="vertical-align: bottom; color: red; font-weight: bold; text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="text-align: left; padding-bottom: 2.5pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">Operating
    Expenses</FONT></TD><TD STYLE="padding-bottom: 2.5pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD>
    <TD STYLE="border-bottom: Black 2.5pt double; text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="border-bottom: Black 2.5pt double; text-align: right"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">2,267,280</FONT></TD><TD STYLE="padding-bottom: 2.5pt; text-align: left"></TD><TD STYLE="padding-bottom: 2.5pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD>
    <TD STYLE="text-align: center; vertical-align: bottom"><FONT STYLE="font: 10pt Times New Roman, Times, Serif; color: Red">(a)</FONT></TD>
    <TD STYLE="border-bottom: Black 2.5pt double; text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="border-bottom: Black 2.5pt double; text-align: right"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">178,811</FONT></TD><TD STYLE="padding-bottom: 2.5pt; text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="color: red; font-weight: bold; padding-bottom: 2.5pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom; color: red; font-weight: bold; text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="vertical-align: bottom; color: red; font-weight: bold; text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="vertical-align: bottom; padding-bottom: 2.5pt; color: red; font-weight: bold; text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="padding-bottom: 2.5pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD>
    <TD STYLE="border-bottom: Black 2.5pt double; text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="border-bottom: Black 2.5pt double; text-align: right"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&mdash;&nbsp;&nbsp;</FONT></TD><TD STYLE="padding-bottom: 2.5pt; text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="padding-bottom: 2.5pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD>
    <TD STYLE="border-bottom: Black 2.5pt double; text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="border-bottom: Black 2.5pt double; text-align: right"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">2,446,091</FONT></TD><TD STYLE="padding-bottom: 2.5pt; text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD>
    <TD STYLE="text-align: center; vertical-align: bottom"><FONT STYLE="font: 10pt Times New Roman, Times, Serif; color: Red">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="color: red; font-weight: bold"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom; color: red; font-weight: bold; text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="vertical-align: bottom; color: red; font-weight: bold; text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="vertical-align: bottom; color: red; font-weight: bold; text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">Loss from Operations</FONT></TD><TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">(1,937,956</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">)</FONT></TD><TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD>
    <TD STYLE="text-align: center; vertical-align: bottom"><FONT STYLE="font: 10pt Times New Roman, Times, Serif; color: Red">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">(109,502</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">)</FONT></TD><TD STYLE="color: red; font-weight: bold"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom; color: red; font-weight: bold; text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="vertical-align: bottom; color: red; font-weight: bold; text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="vertical-align: bottom; color: red; font-weight: bold; text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&mdash;&nbsp;&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">(2,047,458</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">)</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD>
    <TD STYLE="text-align: center; vertical-align: bottom"><FONT STYLE="font: 10pt Times New Roman, Times, Serif; color: Red">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="color: red; font-weight: bold"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom; color: red; font-weight: bold; text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="vertical-align: bottom; color: red; font-weight: bold; text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="vertical-align: bottom; color: red; font-weight: bold; text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">Interest Expense</FONT></TD><TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">(1,935,491</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">)</FONT></TD><TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD>
    <TD STYLE="text-align: center; vertical-align: bottom"><FONT STYLE="font: 10pt Times New Roman, Times, Serif; color: Red">(a)</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">(2,513</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">)</FONT></TD><TD STYLE="color: red; font-weight: bold"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom; color: red; font-weight: bold; text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="vertical-align: bottom; color: red; font-weight: bold; text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">(b)</FONT></TD><TD STYLE="vertical-align: bottom; color: red; font-weight: bold; text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">145,579</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">(1,792,425</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">)</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">Other Income (Expense)</FONT></TD><TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">51,318</FONT></TD><TD STYLE="text-align: left"></TD><TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD>
    <TD STYLE="text-align: center; vertical-align: bottom"><FONT STYLE="font: 10pt Times New Roman, Times, Serif; color: Red">(a)</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">454</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="color: red; font-weight: bold"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom; color: red; font-weight: bold; text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="vertical-align: bottom; color: red; font-weight: bold; text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="vertical-align: bottom; color: red; font-weight: bold; text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">51,772</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="padding-bottom: 1pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="padding-bottom: 1pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="padding-bottom: 1pt; text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="padding-bottom: 1pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD>
    <TD STYLE="text-align: center; vertical-align: bottom"><FONT STYLE="font: 10pt Times New Roman, Times, Serif; color: Red">&nbsp;</FONT></TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="padding-bottom: 1pt; text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="color: red; font-weight: bold; padding-bottom: 1pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom; color: red; font-weight: bold; text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="vertical-align: bottom; color: red; font-weight: bold; text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="vertical-align: bottom; padding-bottom: 1pt; color: red; font-weight: bold; text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="padding-bottom: 1pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="padding-bottom: 1pt; text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="padding-bottom: 1pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="padding-bottom: 1pt; text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; padding-bottom: 1pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">Net
    Loss</FONT></TD><TD STYLE="padding-bottom: 1pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">(3,822,129</FONT></TD><TD STYLE="padding-bottom: 1pt; text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">)</FONT></TD><TD STYLE="padding-bottom: 1pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD>
    <TD STYLE="text-align: center; vertical-align: bottom"><FONT STYLE="font: 10pt Times New Roman, Times, Serif; color: Red">&nbsp;</FONT></TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">(111,561</FONT></TD><TD STYLE="padding-bottom: 1pt; text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">)</FONT></TD><TD STYLE="color: red; font-weight: bold; padding-bottom: 1pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom; color: red; font-weight: bold; text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="vertical-align: bottom; color: red; font-weight: bold; text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="vertical-align: bottom; padding-bottom: 1pt; color: red; font-weight: bold; text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="padding-bottom: 1pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">145,579</FONT></TD><TD STYLE="padding-bottom: 1pt; text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="padding-bottom: 1pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">(3,788,111</FONT></TD><TD STYLE="padding-bottom: 1pt; text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">)</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD>
    <TD STYLE="text-align: center; vertical-align: bottom"><FONT STYLE="font: 10pt Times New Roman, Times, Serif; color: Red">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="color: red; font-weight: bold"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom; color: red; font-weight: bold; text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="vertical-align: bottom; color: red; font-weight: bold; text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="vertical-align: bottom; color: red; font-weight: bold; text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10.5pt; font-weight: bold; padding-bottom: 2.5pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">Net
    loss per share</FONT></TD><TD STYLE="padding-bottom: 2.5pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="padding-bottom: 2.5pt; text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="padding-bottom: 2.5pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD>
    <TD STYLE="text-align: center; vertical-align: bottom"><FONT STYLE="font: 10pt Times New Roman, Times, Serif; color: Red">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="padding-bottom: 2.5pt; text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="color: red; font-weight: bold; padding-bottom: 2.5pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom; color: red; font-weight: bold; text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="vertical-align: bottom; color: red; font-weight: bold; text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="vertical-align: bottom; padding-bottom: 2.5pt; color: red; font-weight: bold; text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="padding-bottom: 2.5pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="padding-bottom: 2.5pt; text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="padding-bottom: 2.5pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD>
    <TD STYLE="border-bottom: Black 2.5pt double; text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="border-bottom: Black 2.5pt double; text-align: right"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">(0.08</FONT></TD><TD STYLE="padding-bottom: 2.5pt; text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">)</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD>
    <TD STYLE="text-align: center; vertical-align: bottom"><FONT STYLE="font: 10pt Times New Roman, Times, Serif; color: Red">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="color: red; font-weight: bold"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom; color: red; font-weight: bold; text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="vertical-align: bottom; color: red; font-weight: bold; text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="vertical-align: bottom; color: red; font-weight: bold; text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-weight: bold"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">Pro forma weighted</FONT></TD><TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD>
    <TD STYLE="text-align: center; vertical-align: bottom"><FONT STYLE="font: 10pt Times New Roman, Times, Serif; color: Red">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="color: red; font-weight: bold"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom; color: red; font-weight: bold; text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="vertical-align: bottom; color: red; font-weight: bold; text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="vertical-align: bottom; color: red; font-weight: bold; text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-weight: bold; padding-bottom: 2.5pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">average
    shares outstanding</FONT></TD><TD STYLE="padding-bottom: 2.5pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="padding-bottom: 2.5pt; text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="padding-bottom: 2.5pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD>
    <TD STYLE="text-align: center; vertical-align: bottom"><FONT STYLE="font: 10pt Times New Roman, Times, Serif; color: Red">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="padding-bottom: 2.5pt; text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="color: red; font-weight: bold; padding-bottom: 2.5pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom; color: red; font-weight: bold; text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="vertical-align: bottom; color: red; font-weight: bold; text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="vertical-align: bottom; padding-bottom: 2.5pt; color: red; font-weight: bold; text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="padding-bottom: 2.5pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="padding-bottom: 2.5pt; text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="padding-bottom: 2.5pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD>
    <TD STYLE="border-bottom: Black 2.5pt double; text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="border-bottom: Black 2.5pt double; text-align: right"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">50,428,177</FONT></TD><TD STYLE="padding-bottom: 2.5pt; text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD></TR>
</TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; text-align: center; margin-top: 0; margin-bottom: 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B></B></FONT></P>



<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"></P>

<P STYLE="font: 12pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 12pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><FONT STYLE="font-size: 10pt; color: Red">(a)
</FONT><FONT STYLE="font-size: 10pt">- to include the pre-acquisition results of operations of Canfield Medical Supply, Inc.&nbsp;</FONT></P>

<P STYLE="font: 12pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 12pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><FONT STYLE="font-size: 10pt; color: Red">(b)
</FONT><FONT STYLE="font-size: 10pt">To reverse interest expense on notes payable which were converted to Common stock concurrently
with the Merger Agreement</FONT></P>

<P STYLE="font: 12pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><FONT STYLE="font-size: 10pt">&nbsp;<B>&nbsp;</B></FONT></P>






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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>


<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt; font-variant: small-caps"></FONT></P>


<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0"><B>&nbsp;</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0"><B>ITEM 4. DESCRIPTION OF SECURITIES.</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">Not applicable.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0"><B>ITEM 5. INTERESTS OF NAMED EXPERTS AND COUNSEL.</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0.5in">Certain legal matters in
connection with this registration statement will be passed upon for the Registrant by Sichenzia Ross Ference LLP of New York, New
York. Sichenzia Ross Ference LLP or certain members or employees of Sichenzia Ross Ference LLP have been issued common stock of
the Company</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">&nbsp;</P>

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    <DIV STYLE="page-break-before: always; margin-top: 6pt"><TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%"><TR><TD STYLE="text-align: center; width: 100%">&nbsp;</TD></TR></TABLE></DIV>
    <!-- Field: /Page -->

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><B>ITEM 6. INDEMNIFICATION OF DIRECTORS AND
OFFICERS.</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0.5in">Our certificate of incorporation
provides that all our directors, officers, employees and agents shall be entitled to be indemnified by us to the fullest extent
permitted under the Colorado law against all liability and expense (including, but not limited to, attorneys' fees) incurred by
reason of the fact that he is or was a director or officer of the Corporation.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; background-color: white">&nbsp;</P>

<P STYLE="text-align: justify; font: 10pt Times New Roman, Times, Serif; text-indent: 0.5in; margin-right: 0; margin-left: 0; background-color: white">Our
Bylaws provide for indemnification of our directors to the fullest extent not prohibited under the Colorado law.</P>

<P STYLE="text-align: justify; font: 10pt Times New Roman, Times, Serif; text-indent: 0.5in; margin-right: 0; margin-left: 0; background-color: white">Our
Bylaws provide that we may indemnify and advance expenses to officers, employees, fiduciaries and agents of the Company as we
deem appropriate and as permitted by Colorado law. &nbsp;No such indemnification shall be made without the prior approval of our
Board of Directors and the determination by the Board of Directors that such indemnification is permissible, except pursuant to
a contract approved by the Board of Directors.<B>&nbsp;</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0"><B>ITEM 7. EXEMPTION FROM REGISTRATION CLAIMED.</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<TABLE CELLSPACING="0" CELLPADDING="0" STYLE="font: 12pt Times New Roman, Times, Serif; width: 100%; border-collapse: collapse">
<TR>
    <TD STYLE="width: 100%"><FONT STYLE="font-size: 10pt">Not applicable. &nbsp;&nbsp;&nbsp;</FONT></TD></TR>
</TABLE>
<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0"><B>ITEM 8. EXHIBITS.</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<TABLE CELLSPACING="0" CELLPADDING="0" STYLE="font: 12pt Times New Roman, Times, Serif; width: 100%; border-collapse: collapse">
<TR STYLE="vertical-align: top">
    <TD STYLE="width: 8%"><FONT STYLE="font-size: 10pt">EXHIBIT</FONT></TD>
    <TD STYLE="width: 1%">&nbsp;</TD>
    <TD STYLE="width: 91%">&nbsp;</TD></TR>
<TR STYLE="vertical-align: top">
    <TD STYLE="border-bottom: black 1.5pt solid"><FONT STYLE="font-size: 10pt">NUMBER</FONT></TD>
    <TD STYLE="padding-bottom: 1.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1.5pt solid"><FONT STYLE="font-size: 10pt">EXHIBIT</FONT></TD></TR>
<TR STYLE="vertical-align: top">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: top; background-color: rgb(204,238,255)">
    <TD><A HREF="e2031_4-1.htm"><FONT STYLE="font-size: 10pt">4.1</FONT></A></TD>
    <TD>&nbsp;</TD>
    <TD><A HREF="e2031_4-1.htm"><FONT STYLE="font-size: 10pt">SPLASH BEVERAGE GROUP, INC. 2020 Long-Term Incentive Compensation Plan</FONT></A></TD></TR>
<TR STYLE="vertical-align: top; background-color: White">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: top; background-color: rgb(204,238,255)">
    <TD><A HREF="e2031_5-1.htm"><FONT STYLE="font-size: 10pt">5.1</FONT></A></TD>
    <TD>&nbsp;</TD>
    <TD><A HREF="e2031_5-1.htm"><FONT STYLE="font-size: 10pt">Opinion of Sichenzia Ross Ference LLP</FONT></A></TD></TR>
<TR STYLE="vertical-align: top; background-color: White">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: top; background-color: rgb(204,238,255)">
    <TD><A HREF="e2031_5-1.htm"><FONT STYLE="font-size: 10pt">23.1</FONT></A></TD>
    <TD>&nbsp;</TD>
    <TD><A HREF="e2031_5-1.htm"><FONT STYLE="font-size: 10pt">Consent of Sichenzia Ross Ference LLP (included in Exhibit 5.1)</FONT></A></TD></TR>
<TR STYLE="vertical-align: top; background-color: White">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: top; background-color: rgb(204,238,255)">
    <TD><A HREF="e2031_23-2.htm"><FONT STYLE="font-size: 10pt">23.2</FONT></A></TD>
    <TD>&nbsp;</TD>
    <TD><A HREF="e2031_23-2.htm"><FONT STYLE="font-size: 10pt">Consent of Daszkal Bolton LLP, Independent Registered Public Accounting Firm</FONT><FONT STYLE="font-size: 8pt">&nbsp;</FONT><FONT STYLE="font-size: 10pt">.</FONT></A></TD></TR>
<TR STYLE="vertical-align: top; background-color: White">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: top; background-color: rgb(204,238,255)">
    <TD><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><A HREF="e2031_23-3.htm">23.3</A></FONT></TD>
    <TD><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD>
    <TD><P STYLE="margin: 0; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><A HREF="e2031_23-3.htm">Consent of Grant Thornton LLP, Independent Registered Public Accounting Firm</A></FONT></P></TD></TR>
<TR STYLE="vertical-align: top; background-color: White">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: top; background-color: rgb(204,238,255)">
    <TD><A HREF="e2031_23-4.htm"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">23.4</FONT></A></TD>
    <TD><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD>
    <TD><A HREF="e2031_23-4.htm"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Consent of Pinnacle Accountancy Group of Utah</FONT></A></TD></TR>
<TR STYLE="vertical-align: top; background-color: White">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: top; background-color: rgb(204,238,255)">
    <TD><A HREF="#a_001"><FONT STYLE="font-size: 10pt">24.1</FONT></A></TD>
    <TD>&nbsp;</TD>
    <TD><A HREF="#a_001"><FONT STYLE="font-size: 10pt">Power of Attorney (included on signature page)</FONT></A></TD></TR>
</TABLE>
<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0"><B>ITEM 9. UNDERTAKINGS.</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 4.5pt 0 0; text-indent: 48.95pt; background-color: white">1. The Company
hereby undertakes:</P>

<P STYLE="text-align: justify; font: 10pt Times New Roman, Times, Serif; margin: 4.5pt 0 0 74.8pt; text-indent: 24.5pt; background-color: white">(a)
To file, during any period in which offers or sales are being made, a post-effective amendment to this Registration Statement:</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 4.5pt 0 0 121.6pt; background-color: white">(i) To include any prospectus
required by Section&nbsp;10(a)(3) of the Securities Act;</P>

<P STYLE="text-align: justify; font: 10pt Times New Roman, Times, Serif; margin: 4.5pt 0 0 121.6pt; background-color: white">(ii) To reflect in the
prospectus any facts or events arising after the effective date of this Registration Statement (or the most recent post-effective
amendment thereof) which, individually or in the aggregate, represent a fundamental change in the information set forth in the
registration statement. Notwithstanding the foregoing, any increase or decrease in volume of securities offered (if the total dollar
value of securities offered would not exceed that which was registered) and any deviation from the low or high end of the estimated
maximum offering range may be reflected in the form of prospectus filed with the Commission pursuant to Rule 424(b) if, in the
aggregate, the changes in volume and price represent no more than a 20 percent change in the maximum aggregate offering price set
forth in the &ldquo;Calculation of Registration Fee&rdquo; table in the effective registration statement; and</P>

<P STYLE="text-align: justify; font: 10pt Times New Roman, Times, Serif; margin: 4.5pt 0 0 121.6pt; background-color: white">(iii) To include any material
information with respect to the plan of distribution not previously disclosed in this Registration Statement or any material change
to such information in this Registration Statement;</P>

<P STYLE="text-align: justify; font: 10pt Times New Roman, Times, Serif; margin: 4.5pt 0 0 74.8pt; background-color: white">provided, however, that
paragraphs (1)(a)(i)&nbsp;and (1)(a)(ii)&nbsp;do not apply if the information required to be included in a post-effective amendment
by those paragraphs is contained in periodic reports filed by the Registrant pursuant to Section&nbsp;13 or Section&nbsp;15(d)
of the Exchange Act that are incorporated by reference in this Registration Statement;</P>

<P STYLE="text-align: justify; font: 10pt Times New Roman, Times, Serif; margin: 4.5pt 0 0 74.8pt; text-indent: 24.5pt; background-color: white">(b)
That, for the purpose of determining any liability under the Securities Act, each such post-effective amendment shall be deemed
to be a new registration statement relating to the securities offered therein, and the offering of such securities at that time
shall be deemed to be the initial bona fide offering thereof; and</P>

<P STYLE="text-align: justify; font: 10pt Times New Roman, Times, Serif; margin: 4.5pt 0 0 74.8pt; text-indent: 24.5pt; background-color: white">(c)
To remove from registration by means of a post-effective amendment any of the securities being registered which remain unsold at
the termination of the offering.</P>

<P STYLE="text-align: justify; font: 10pt Times New Roman, Times, Serif; margin: 4.5pt 0 0 74.8pt; text-indent: 24.5pt; background-color: white">(d)
That, for the purpose of determining liability of the Company under the Securities Act to any purchaser in the initial distribution
of the securities: The Company undertakes that in a primary offering of securities of the Company pursuant to this Registration
Statement, regardless of the underwriting method used to sell the securities to the purchaser, if the securities are offered or
sold to such purchaser by means of any of the following communications, the Company will be a seller to the purchaser and will
be considered to offer or sell such securities to such purchaser: (i)&nbsp;any preliminary prospectus or prospectus of the Company
relating to the offering required to be filed pursuant to Rule 424; (ii)&nbsp;any free writing prospectus relating to the offering
prepared by or on behalf of the Company or used or referred to by the Company; (iii)&nbsp;the portion of any other free writing
prospectus relating to the offering containing material information about the Company or its securities provided by or on behalf
of the Company; and (iv)&nbsp;any other communication that is an offer in the offering made by the Company to the purchaser.</P>

<P STYLE="text-align: justify; font: 10pt Times New Roman, Times, Serif; margin: 9pt 0 0; text-indent: 48.95pt; background-color: white">2. The Company
hereby undertakes that, for purposes of determining any liability under the Securities Act, each filing of the Company&rsquo;s
annual report pursuant to Section&nbsp;13(a) or Section&nbsp;15(d) of the Exchange Act that is incorporated by reference in the
Registration Statement shall be deemed to be a new registration statement relating to the securities offered therein, and the offering
of such securities at that time shall be deemed to be the initial bona fide offering thereof.</P>

<P STYLE="text-align: justify; font: 10pt Times New Roman, Times, Serif; margin: 9pt 0 0; text-indent: 48.95pt; background-color: white">3. Insofar
as indemnification for liabilities arising under the Securities Act may be permitted to directors, officers and controlling persons
of the Company pursuant to the foregoing provisions, or otherwise, the Company has been advised that in the opinion of the Commission
such indemnification is against public policy as expressed in the Securities Act and is, therefore, unenforceable. In the event
that a claim for indemnification against such liabilities (other than the payment by the Company of expenses incurred or paid by
a director, officer or controlling person of the Company in the successful defense of any action, suit or proceeding) is asserted
by such director, officer or controlling person in connection with the securities being registered, the Company will, unless in
the opinion of its counsel the matter has been settled by controlling precedent, submit to a court of appropriate jurisdiction
the question whether such indemnification by it is against public policy as expressed in the Securities Act and will be governed
by the final adjudication of such issue.</P>

<P STYLE="font: 12pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

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<P STYLE="font: 12pt Times New Roman, Times, Serif; margin: 0"></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><B>SIGNATURES</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">Pursuant to the requirements of the Securities
Act of 1933, as amended, the registrant certifies that it has reasonable grounds to believe that it meets all of the requirements
for filing on Form S-8 and has duly caused this Form S-8 to be signed on its behalf by the undersigned, thereunto duly authorized,
in the City of Fort Lauderdale, State of Florida on  August 18, 2020.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-indent: 429pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</P>

<TABLE CELLSPACING="0" CELLPADDING="0" STYLE="font: 12pt Times New Roman, Times, Serif; width: 100%; border-collapse: collapse">
<TR STYLE="vertical-align: top">
    <TD><FONT STYLE="font-size: 10pt">&nbsp;&#9;</FONT></TD>
    <TD COLSPAN="2">&nbsp;</TD></TR>
<TR STYLE="vertical-align: top">
    <TD STYLE="width: 62%">&nbsp;</TD>
    <TD STYLE="width: 3%">&nbsp;</TD>
    <TD STYLE="width: 35%">&nbsp;</TD></TR>
<TR STYLE="vertical-align: top">
    <TD>&nbsp;</TD>
    <TD><FONT STYLE="font-size: 10pt">By:&nbsp;&nbsp;</FONT></TD>
    <TD STYLE="border-bottom: black 1.5pt solid"><FONT STYLE="font-size: 10pt">/s/ <I>Robert Nistico </I></FONT></TD></TR>
<TR STYLE="vertical-align: top">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>
        <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">Robert Nistico</P>
        <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">Chief Executive Officer</P></TD></TR>
</TABLE>
<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><B>&nbsp;</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><A NAME="a_001" TITLE="POA"></A><B>POWER OF ATTORNEY</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0.25in">KNOW ALL MEN BY THESE
PRESENTS, that each person whose signature appears below constitutes and appoints Robert Nistico , his true and lawful attorney-in-fact
and agent with full power of substitution and re-substitution, for him/her and in his name, place and stead, in any and all capacities
to sign any or all amendments (including, without limitation, post-effective amendments) to this Registration Statement, any related
Registration Statement filed pursuant to Rule 462(b) under the Securities Act of 1933, as amended, and any or all pre- or post-effective
amendments thereto, and to file the same, with all exhibits thereto, and all other documents in connection therewith, with the
Securities and Exchange Commission, granting unto said attorney-in-fact and agent, full power and authority to do and perform each
and every act and thing requisite and necessary to be done in and about the premises, as fully for all intents and purposes as
he or she might or could do in person, hereby ratifying and confirming that said attorney-in-fact and agent, or any substitute
or substitutes for him, may lawfully do or cause to be done by virtue hereof.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0.25in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">Pursuant to the requirements of the Securities
Act of 1933, as amended, this Registration Statement has been signed below by the following persons in the capacities and on the
dates indicated.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-indent: 27.5pt">&nbsp;&nbsp;</P>

<TABLE CELLSPACING="0" CELLPADDING="0" STYLE="font: 12pt Times New Roman, Times, Serif; width: 100%; border-collapse: collapse">
<TR STYLE="vertical-align: top">
    <TD STYLE="width: 60%"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Date: August 18, 2020 </FONT></TD>
    <TD STYLE="width: 40%; border-bottom: black 1pt solid"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">/s/
    <I>Robert Nistico </I></FONT></TD></TR>
<TR STYLE="vertical-align: top">
    <TD><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD>
    <TD><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Robert Nistico </FONT></TD></TR>
<TR STYLE="vertical-align: top">
    <TD><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD>
    <TD><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Chief Executive Officer </FONT></TD></TR>
<TR STYLE="vertical-align: top">
    <TD><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD>
    <TD><P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-indent: 27.5pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>
        <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-indent: 27.5pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P></TD></TR>
<TR STYLE="vertical-align: top">
    <TD><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Date:August 18, 2020</FONT></TD>
    <TD STYLE="border-bottom: black 1pt solid"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">/s/ <I>Dean
    Huge</I></FONT></TD></TR>
<TR STYLE="vertical-align: top">
    <TD><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD>
    <TD><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Dean Huge</FONT></TD></TR>
<TR STYLE="vertical-align: top">
    <TD><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD>
    <TD><P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Chief
        Financial Officer</FONT></P>
        <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0"></P></TD></TR>
</TABLE>

<P STYLE="font: 12pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: right"></P>

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[{"type": "S-8", "sequence": "1", "filename": "e2031_s8.htm", "description": "FORM S-8", "secsgml_size_bytes": 961250}]
{"company-data": {"conformed-name": "SPLASH BEVERAGE GROUP, INC.", "cik": "0001553788", "assigned-sic": "2080", "irs-number": "341720075", "state-of-incorporation": "CO", "fiscal-year-end": "1231"}, "filing-values": {"form-type": "S-8", "act": "33", "file-number": "333-248109", "film-number": "201114408"}, "business-address": {"street1": "1314 E LAS OLAS BLVD, SUITE 221", "city": "FORT LAUDERDALE", "state": "FL", "zip": "33301", "phone": "954.745.5815"}, "mail-address": {"street1": "1314 E LAS OLAS BLVD, SUITE 221", "city": "FORT LAUDERDALE", "state": "FL", "zip": "33301"}, "former-company": {"former-conformed-name": "Canfield Medical Supply, Inc.", "date-changed": "20120709"}}
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM S-8
REGISTRATION STATEMENT UNDER THE SECURITIES
ACT OF 1933
SPLASH
BEVERAGE GROUP, INC.
(Exact name of issuer as specified in its charter)
Colorado
34-1720075
(State or other jurisdiction of
(I.R.S. Employer
incorporation or organization)
Identification No.)
1314 E Las Olas Blvd.
Suite 221
Fort Lauderdale, FL
33301
(Address of principal executive offices)
(Zip Code)
SPLASH BEVERAGE GROUP, INC.
2020 LONG-TERM INCENTIVE COMPENSATION PLAN
(Full title of the plan)
Robert Nistico
Chief Executive Officer
Canfield Medical Supply, Inc.
1314 E Las Olas Blvd.
Suite 221
Fort Lauderdale, Florida 33301
(Name and address of agent for service)
(954) 745-5815
(Telephone number, including area code, of agent
for service)
Copies to:
Darrin M. Ocasio, Esq.
Sichenzia Ross Ference LLP
1185 Avenue of the Americas, 37
th
Floor
New York, New York 10036
Telephone: (212) 930-9700
Fax Number: (212) 930-9725
Indicate by check mark whether the registrant is a large accelerated
filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company or an emerging growth company. See the definitions
of "large accelerated filer," "accelerated filer," "smaller reporting company," and "emerging
growth company" in Rule 12b-2 of the Exchange Act.
Large accelerated filer ☐
Accelerated filer ☐
Non-accelerated filer ☒
Smaller reporting company ☒
Emerging Growth Company ☐
If an emerging growth company, indicate by
check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial
accounting standards provided pursuant to Section 7(a)(2)(B) of the Securities Act. ☐
CALCULATION OF REGISTRATION FEE
Proposed Maximum
Proposed Maximum
Title of Securities
Amount To Be
Offering Price Per
Aggregate Offering
Amount of registration
to be Registered
Registered(1)
Share
Price(2)
fee
Common Stock, $0.001 par value per share
6,939,398
0.46
$3,192,123.08
$414.34
(1) Pursuant to Rule 416 promulgated under
the Securities Act of 1933, as amended, (the "Securities Act") this registration statement also covers an indeterminate
amount of interests to be offered or sold pursuant to the employee benefit plan(s) described herein.
(2) Estimated solely for purposes of calculating
the registration fee in accordance with Rules 457(c) and 457(h)(1) under the Securities Act using the average of the high and low
prices per share of the Registrant's Common Stock as reported on the OTC Market on June 3, 2019, which date is within five
business days prior to filing this Registration Statement,.
PART 1
INFORMATION REQUIRED IN THE SECTION 10(a)
PROSPECTUS
ITEM 1. PLAN INFORMATION.
Splash Beverage Group, Inc. (previously, "Canfield Medical
Supply, Inc.") ("we", "us", "our", the "Company", "Splash" or "Canfield")
will provide each participant (the "Recipient") with documents that contain information related to the Splash Beverage
Group, Inc. 2020 Long-Term Incentive Compensation Plan, and other information including, but not limited to, the disclosure required
by Item 1 of Form S-8, which information is not filed as a part of this Registration Statement on Form S-8 (the "Registration
Statement"). The foregoing information and the documents incorporated by reference in response to Item 3 of Part II of this
Registration Statement taken together constitute a prospectus that meets the requirements of Section 10(a) of the Securities Act.
A Section 10(a) prospectus will be given to each Recipient who receives common shares covered by this Registration Statement, in
accordance with Rule 428(b)(1) under the Securities Act.
ITEM 2. REGISTRANT INFORMATION AND EMPLOYEE PLAN ANNUAL INFORMATION.
We will provide to each Recipient a written
statement advising them of the availability of documents incorporated by reference in Item 3 of Part II of this Registration Statement
(which documents are incorporated by reference in this Section 10(a) prospectus) and of documents required to be delivered pursuant
to Rule 428(b) under the Securities Act without charge and upon written or oral notice by contacting:
Dean Huge, Chief Financial Officer
Splash Beverage Group, Inc.
1314 E Las Olas Blvd.
Suite 221
Fort Lauderdale, Florida 33316
(954) 745-5815
INFORMATION REQUIRED BY PART I TO BE CONTAINED
IN SECTION 10(a) PROSPECTUS IS OMITTED FROM THE REGISTRATION STATEMENT IN ACCORDANCE WITH RULE 428 UNDER THE SECURITIES ACT OF
1933, AND NOTE TO PART I OF FORM S-8.
2
PART II
INFORMATION NOT REQUIRED IN THE REGISTRATION
STATEMENT
ITEM 3. INCORPORATION OF DOCUMENTS BY REFERENCE.
The Securities and Exchange Commission ("SEC")
allows us to "incorporate by reference" information into this prospectus. The Registrant hereby incorporates by reference
into this Registration Statement the documents listed below. In addition, all documents subsequently filed pursuant to Sections
13(a), 13(c), 14 and 15(d) of the Exchange Act prior to the filing of a post-effective amendment which indicates that all securities
offered have been sold or which deregisters all securities then remaining unsold, shall be deemed to be incorporated by reference
into this Registration Statement and to be a part hereof from the date of filing of such documents.
(a)       Our
Annual Report on Form 10-K for the year ended December 31, 2019 filed with the SEC on March 27, 2020;
(b)      Our Quarterly Report on Form 10-Q and 10-Q/A, as amended, for the
quarterly period ended March 31, 2020 filed with the SEC on May 13, 2020 and May 14, 2020, respectively, and Quarterly Report on
Form 10-Q for the quarter ended June 30, 2020, filed with the Commission on August 13, 2020;
(c)        Our
Current Reports on Form 8-K or 8-K/A filed with the SEC on January 7, 2020, April 6, 2020, April 17, 2020, April 22, 2020, May
7, 2020 and May 29, 2020;
(d)       All
other reports filed pursuant to Section 13(a) or 15(d) of the Exchange Act since the end of the fiscal year covered by the Registrant's
latest annual report or prospectus referred to in (a) above; and
(e)        The
description of the Registrant's Common Stock incorporated herein by reference from the Company's Registration Statement
on Form 8-A, filed with the Securities and Exchange Commission December 13, 2020.
3
Splash
Beverage Group, Inc.
Consolidated
Financial Statements
December
31, 2019 and 2018
Table
of Contents
Reports of Independent Registered
    Public Accounting Firms
F-2 - F-3
Financial Statements
Consolidated
    Balance Sheets
F-
4
Consolidated
    Statements of Operations
F-
5
Consolidated
    Statements of Changes in Deficiency in Stockholders' Equity
F-
6
Consolidated
    Statements of Cash Flows
F-
7
Notes to the Consolidated
    Financial Statements
F-8
– F-27
F-
1
grant
        thornton llp
101 E KENNEDY
        BLVD, SUITE 3850
TAMPA, FL 33602
D
        +1 813 229 7201
F +1 813 223 3015
REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
Board
of Directors and Shareholders
Splash
Beverage Group, Inc. (formerly Canfield Medical Supply, Inc.)
Opinion
on the financial statements
We
have audited the accompanying consolidated balance sheet of Splash Beverage Group, Inc. (a Colorado corporation) and subsidiaries
(the "Company") as of December 31, 2018, the related consolidated statements of operations, changes in deficiency
in stockholders' equity, and cash flows for the year ended December 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 December 31, 2018, and the results of its operations and its cash flows for the year
ended December 31, 2018, in conformity with accounting principles generally accepted in the United States of America.
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 incurred a net loss of approximately $3.8 million during the year ended December
31, 2018. This condition, along with other matters as set forth in Note 3, raise substantial doubt about the Company's ability
to continue as a going concern.  Management's plans in regards to these matters are also described in Note 3. 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 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.
/s/ GRANT THORNTON LLP
We
served as the Company's auditor from 2018 to 2019.
Tampa,
Florida
August
18, 2020
F-
2
REPORT
OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
To
the Board of Directors and
Stockholders of Splash Beverage Group, Inc.
(FKA
Canfield Medical Supply, Inc.)
Opinion
on the Financial Statements
We
have audited the accompanying consolidated balance sheets of Splash Beverage Group, Inc. (formerly known as Canfield Medical Supply,
Inc.) (the "Company") at December 31, 2019, and the related consolidated statements operations, changes in deficiency
in stockholders' equity and cash flows for the year ended December 31, 2019, and the related notes (collectively referred
to as the consolidated financial statements). In our opinion, the consolidated financial statements present fairly, in all material
respects, the financial position of the Company at December 31, 2019, and the results of its operations and its cash flows for
the year ended December 31, 2019, in conformity with accounting principles generally accepted in the United States of America.
Going
Concern Uncertainty
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 suffered recurring losses from operations and has a net 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 3. The financial statements do not include any adjustments that might result from the outcome of this uncertainty.
Basis
for Opinion
These
consolidated 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 consolidated 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 consolidated 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 consolidated 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
consolidated financial statements. We believe that our audits provide a reasonable basis for our opinion.
/s/
Daszkal Bolton LLP
Daszkal
                                         Bolton LLP
April
        3, 2020, except for note 1 to which the date is July 31, 2020
Boca
        Raton, Florida
We
        have served as the Company's auditor since 2020.
F-
3
Splash Beverage Group, Inc. and Subsidiaries
Consolidated Balance Sheets
December 31, 2019 and 2018
2019
2018
Assets
Current assets:
Cash and cash equivalents
$
42,639
$
938,040
Accounts receivable, net
11,430
—
Prepaid expenses
5,449
5,648
Inventory
304,012
276,788
Other receivables
7,132
5,700
Total current assets
370,662
1,226,176
Non-current assets:
Deposit
34,915
14,402
Right of use asset, net
162,008
—
Property and equipment, net
37,729
34,513
Total non-current assets
234,652
48,915
Total assets
$
605,314
$
1,275,091
Liabilities and Deficiency in Stockholders' Equity
Liabilities:
Current liabilities
Accounts payable and accrued expenses
$
703,885
$
831,070
Right of use liability – current
81,502
—
Due to related parties
429,432
302,934
Bridge loan payable, net
2,200,000
1,858,385
Related party notes payable – current
1,505,100
—
Convertible bridge loan payable – current
2,202,664
100,000
Notes payable
875,000
875,000
Royalty payable
39,000
21,062
Revenue financing arrangements
45,467
77,108
Shareholder advances
46,250
16,250
Accrued interest payable
1,604,498
1,119,909
Accrued interest payable - related parties
546,362
426,740
Total current liabilities
10,279,160
5,628,458
Long-term Liabilities:
Related party notes payable - non-current
—
1,375,100
Convertible bridge loan payable - non-current
—
2,102,664
Right of use liability – noncurrent
82,238
—
Total long-term liabilities
82,238
3,477,764
Total liabilities
10,361,398
9,106,222
Deficiency in stockholders' equity:
Common Stock, $0.001 par, 100,000,000 shares authorized, 44,021,389
and 40,165,002 issued and 43,885,096 and 39,892,417 outstanding for the years ended December 31, 2019 and 2018, respectively
44,021
40,165
Additional paid in capital
22,095,403
18,938,480
Treasury Stock, $0.001 par, 136,293 and 272,585 shares for the years ended December 31 2019 and 2018, respectively
(50,000
)
(100,000
)
Accumulated deficit
(31,845,506
)
(26,709,776
)
Total deficiency in stockholders' equity
(9,756,083
)
(7,831,131
)
Total liabilities and deficiency in stockholders' equity
$
605,314
$
1,275,091
The accompanying
notes are an integral part of these consolidated financial statements.
F-
4
Splash Beverage Group, Inc. and Subsidiaries
Consolidated Statements of Operations
For the Years Ended December 31, 2019 and 2018
2019
2018
Net revenues
$
20,387
$
16,176
Cost of goods sold
(245,500
)
(109,706
)
Negative gross margin
(225,113
)
(93,530
)
Operating expenses:
Contracted services
2,109,146
1,493,076
Salary and wages
1,078,730
508,769
Other general and administrative
1,006,603
888,817
Sales and marketing
67,467
112,506
Total operating expenses
4,261,946
3,003,168
Loss from operations
(4,487,059
)
(3,096,698
)
Other income/(expense):
Interest income
132
-
Interest expense
(665,195
)
(684,833
)
Gain/(loss) from debt extinguishment
16,391
(42,382
)
Total other income/(expense)
(648,672
)
(727,215
)
Provision for income taxes
-
-
Net loss
$
(5,135,731
)
$
(3,823,913
)
Net loss per share (basic and diluted)
$
(0.12
)
$
(0.11
)
Weighted average number of common shares outstanding
42,154,947
36,108,948
The
accompanying notes are an integral part of these consolidated financial statements.
F-
5
Splash Beverage Group, Inc. and Subsidiaries
Consolidated Statements of Changes in Deficiency in Stockholders'
Equity
For the Year Ended December 31, 2019
Deficiency in
Common Stock
Treasury Stock
Additional
Accumulated
Stockholders'
Shares
Amount
Shares
Amount
Paid-In Capital
Deficit
Equity
Balances at December 31, 2017
35,150,103
$
35,150
408,877
$
(150,000
)
$
15,716,749
$
(22,885,863
)
$
(7,283,964)
Issuance of Common stock for cash
4,878,607
4,879
—
—
2,180,444
—
2,185,323
Issuance of Common stock from treasury
136,292
136
(136,292
)
50,000
49,864
—
100,000
Warrants issued with debt
—
—
—
—
991,423
—
991,423
Net loss
—
—
—
—
—
(3,823,913
)
(3,823,913
)
Balances at December 31, 2018
40,165,002
$
40,165
272,585
$
(100,000
)
$
18,938,480
$
(26,709,776
)
$
(7,831,131
)
Issuance of Common stock for cash
2,146,601
2,146
—
—
1,572,854
—
$
1,575,000
Issuance of Common stock for services
1,709,785
1,709
—
—
1,252,914
—
1,254,623
Issuance of Common stock from treasury
—
—
(136,292
)
50,000
49,900
—
99,900
Warrants issued in connection with debt modification
—
—
—
—
15,667
—
15,667
Share-based compensation
—
—
—
—
265,589
—
265,589
Net loss
—
—
—
—
—
(5,135,731
)
(5,135,731
)
Balances at December 31, 2019
44,021,389
$
44,021
136,293
$
(50,000
)
$
22,095,403
$
(31,845,506
)
$
(9,756,083
)
The
accompanying notes are an integral part of these consolidated financial statements.
F-
6
Splash Beverage Group, Inc. and Subsidiaries
Consolidated Statements of Cash Flows
December 31, 2019 and 2018
2019
2018
Cash Flows from Operating Activities
Net loss
$
(5,135,731
)
$
(3,823,913
)
Adjustments to reconcile net loss to net cash used in operating activities:
Depreciation and amortization
9,334
7,257
Amortization of right-of-use asset
53,194
-
Gain from debt extinguishment
(16,391
)
-
Deferred loan cost amortization
-
130,055
Noncash finance charge in connection with a debt modification
15,667
-
Share-based compensation
265,589
-
Shares issued in exchange for services
1,354,503
664,815
Warrants issued for services
-
991,423
Other noncash charges
360,923
32,252
Changes in assets and liabilities:
Accounts receivable
(11,428
)
-
Inventory
(27,224
)
(276,788
)
Prepaid expenses and other current assets
(1,233
)
(20,049
)
Due to related party
-
5,496
Deposits
(20,513
)
-
Accounts payable and accrued expenses
(127,167
)
255,352
Royalty payable
17,938
(326,750
)
Accrued interest payable
604,211
(110,345
)
Net cash used in operating activities
(2,658,328
)
(2,471,195
)
Cash Flows from Investing Activities:
Capital expenditures
(12,552
)
(1,336
)
Net cash used in investing activities
(12,552
)
(1,336
)
Cash Flows from Financing Activities:
Proceeds from issuance of common stock
1,575,000
1,398,197
Shareholder advances
153,582
-
Proceeds from issuance of debt
130,000
2,702,664
Principal repayment of debt
(31,641
)
(422,425
)
Debt issuance costs
-
(271,670
)
Reduction of right-of-use liability
(51,462
)
-
Net cash provided by financing activities
1,775,479
3,406,766
Net Decrease in Cash and Cash Equivalents
(895,401
)
934,235
Cash and Cash Equivalents, beginning of year
938,040
3,805
Cash and Cash Equivalents, end of year
$
42,639
$
938,040
Supplemental Disclosure of Cash Flow Information:
Cash paid for interest
$
23,851
$
586,075
Cash paid for taxes
$
-
$
-
Supplemental Disclosure of Non-Cash Investing
    and Financing Activities
Notes converted to common stock
$
-
$
684,450
Loss on debt extinguishment
$
-
$
42,382
The
accompanying notes are an integral part of these consolidated financial statements.
F-
7
Splash
Beverage Group, Inc.
Notes
to the Consolidated Financial Statements
Note 1 – Business Organization and Nature of Operations
Splash Beverage Group ("SBG"),
f/k/a Canfield Medical Supply, Inc. (the "CMS"), was incorporated in the State of Ohio on September 3, 1992, and changed
domicile to Colorado on April 18, 2012. CMS is in the business of home health services, primarily the selling of durable medical
equipment and medical supplies to the public, nursing homes, hospitals and other end users.
On December 31, 2019, CMS entered into
an Agreement and Plan of Merger (the "Merger Agreement") with SBG Acquisition Inc. ("Merger Sub"), a Nevada
Corporation wholly-owned by CMS, and Splash Beverage Group, Inc. a Nevada corporation ("Splash") pursuant to which
Merger Sub merged with and into Splash (the "Merger") with Splash as the surviving company and a wholly-owned subsidiary
of CMS. The Merger was consummated on March 31, 2020.
As the owners and management of Splash
have voting and operating control of CMS following the Merger, the Merger transaction was accounted for as a reverse acquisition
(that is with Splash as the acquiring entity), followed by a recapitalization.
As part of the recapitalization, previously
issued shares of SBG preferred stock have been reflected as shares of common stock that were received in the Merger. These common
shares have been retrospectively presented as outstanding for all periods.
Splash specializes in the manufacturing,
distribution, and sales & marketing of various beverages across multiple channels. Splash operates in both the non-alcoholic
and alcoholic beverage segments. Additionally, Splash operates its own vertically integrated B-to-B and B-to-C e-commerce distribution
platform called Qplash, further expanding its distribution abilities and visibility.
On July 2, 2020, CMS received a Certificate
of Good Standing from the State of Colorado. This certificate allowed us to change our name from Canfield Medical Supply, Inc.
to Splash Beverage Group, Inc. a Colorado company. On July 31, 2020, we received approval from FINRA to change the Company's
name from Canfield Medical Supply, Inc. to Splash Beverage Group, Inc.
These financial statements represent the
operations of SBG and do not include the operations of CMS.
Note 2 –
Summary of Significant Accounting Policies
Basis of Presentation and Consolidation
Our accounting and reporting policies conform
to accounting principles generally accepted in the United States of America ("GAAP"). These consolidated financial
statements include the accounts of Splash and its wholly owned subsidiaries, Splash International Holdings, LLC, Splash Beverage
Holdings, LLC and Splash Mex SA de CV. All intercompany balances have been eliminated in consolidation.
Use of Estimates
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 disclosures of contingent assets and liabilities at the date of the financial statements and the reported amounts
of revenues and expenses during the reporting period. Actual results could differ from those estimates.
Cash Equivalents and Concentration
of Cash Balance
We consider all highly liquid securities with
an original maturity of three months or less to be cash equivalents. We had no cash equivalents at December 31, 2019. Our cash
in bank deposit accounts, at times, may exceed federally insured limits of $250,000. Our bank deposit accounts in Mexico are uninsured.
Accounts Receivable and Allowance
for Doubtful Accounts
Accounts receivable are carried at their estimated
collectible amounts and are periodically evaluated for collectability based on past credit history with clients and other factors.
We establish provisions for losses on accounts receivable on the basis of loss experience, known and inherent risk in the account
balance, and current economic conditions.  At December 31, 2019 and 2018, our accounts receivable amounts are reflected net
of allowances of $11,430 and $0, respectively.
F-
8
Splash
Beverage Group, Inc.
Notes
to the Consolidated Financial Statements
Note
2 – Summary of Significant Accounting Policies, continued
Inventory
Inventory is stated at the lower of cost or
net realizable value, accounted for using the weighted average cost method. The inventory balances at December 31, 2019 and 2018
consisted of finished goods held for distribution. The cost elements in inventory consist of purchase of products, transportation,
and warehousing. Inventory valuation is impacted by excess or inventory near expiration based on management's estimates for
excess or inventory near expiration based on management's estimates of forecast turnover of inventories on hand and under
contract. A significant change in the timing or level of demand for certain products as compared to forecast amounts may result
in recording expense for excess or expired inventory in the future. The costs for excess inventory are included in cost of goods
sold and have historically been adequate to provide for losses on inventory. We manage inventory levels and purchase commitments
in an effort to maximize utilization of inventory on hand and under commitments.
Property
and Equipment
We
record property and equipment at cost when purchased. Depreciation is recorded for property, equipment, and software using the
straight-line method over the estimated economic useful lives of assets, which range from 3-10 years. Company management reviews
the recoverability of all long-lived assets, including the related useful lives, whenever events or changes in circumstances indicate
that the carrying amount of a long-lived asset might not be recoverable.
Depreciation
expense totaled $19,781 and $7,257 for the years ended December 31, 2019 and 2018, respectively. Property and equipment as of
December 31, 2019 and 2018 consisted of the following:
2019
2018
Property and equipment, at cost
$
88,758
$
76,205
Accumulated depreciation
(51,029
)
(41,692
)
Property and equipment, net
$
37,729
$
34,513
Licensing
Agreements
We
capitalize the costs for our licensing agreements with ABG TapouT, LLC and Salt Tequila USA, LLC, which are amortized to expense
on a straight-line basis over the term of the agreements.
The
initial amount of the TapouT agreement as entered into by a related party prior to the Company's assumption in 2013 was
$4,000,000 to be paid over several years pursuant to a guaranteed minimum royalty agreement. Royalty costs incurred under the
agreements, guaranteed minimum royalty amounts, are expensed as incurred. See Notes 5 and 13 for further information.
We
have not made any payments to Salt Tequila USA, LLC under the licensing agreement due to the immaterial nature of our sales from
the brand. See Note 10 for further information.
F-
9
Splash
Beverage Group, Inc.
Notes
to the Consolidated Financial Statements
Note
2 – Summary of Significant Accounting Policies, continued
Fair
Value of Financial Instruments
Financial
Accounting Standards Board ("FASB") guidance specifies a hierarchy of valuation techniques based on whether the inputs
to those valuation techniques are observable or unobservable. Observable inputs reflect market data obtained from independent
sources, while unobservable inputs reflect market assumptions. The hierarchy gives the highest priority to unadjusted quoted prices
in active markets for identical assets or liabilities (Level 1 measurement) and the lowest priority to unobservable inputs (Level
3 measurement). The three levels of the fair value hierarchy are as follows:
Level 1
-
Unadjusted
                                         quoted prices in active markets for identical assets or liabilities that the reporting
                                         entity has the ability to access at the measurement date. Level 1 primarily consists
                                         of financial instruments whose value is based on quoted market prices such as exchange-traded
                                         instruments and listed equities.
Level
2
-
Inputs
                                         other than quoted prices included within Level 1 that are observable for the asset or
                                         liability, either directly or indirectly (e.g., quoted prices of similar assets or liabilities
                                         in active markets, or quoted prices for identical or similar assets or liabilities in
                                         markets that are not active).
Level
3
-
Unobservable
                                         inputs for the asset or liability. Financial instruments are considered Level 3 when
                                         their fair values are determined using pricing models, discounted cash flows or similar
                                         techniques and at least one significant model assumption or input is unobservable.
The
liabilities and indebtedness presented on the consolidated financial statements approximate fair values at December 31, 2019 and
2018, consistent with recent negotiations of notes payable and due to the short duration of maturities.
Convertible
Instruments
U.S.
GAAP requires the bifurcation of certain conversion rights contained in convertible indebtedness and account for them as free
standing derivative financial instruments according to certain criteria. This criteria include circumstances in which (a) the
economic characteristics and risks of the embedded derivative instrument are not clearly and closely related to the economic characteristics
and risks of the host contract, (b) the hybrid instrument that embodies both the embedded derivative instrument and the host
contract is not re-measured at fair value under otherwise applicable generally accepted accounting principles with changes in
fair value reported in earnings as they occur and (c) a separate instrument with the same terms as the embedded derivative
instrument would be considered a derivative instrument. An exception to this rule is when the host instrument is deemed to be
conventional as that term is described under applicable U.S. GAAP.
When
bifurcation is required, the embedded conversion options are bifurcated from the convertible note, resulting in the recognition
of discounts to convertible notes for the intrinsic value of conversion options embedded in debt instruments based upon the differences
between the fair value of the underlying common stock at the commitment date of the note transaction and the effective conversion
price embedded in the note.  Debt discounts under these arrangements are amortized over the term of the related debt to their
stated date of redemption.
F-
10
Splash
Beverage Group, Inc.
Notes
to the Consolidated Financial Statements
Note
2 – Summary of Significant Accounting Policies, continued
Convertible
Instruments, continued
With
respect to convertible preferred stock, we record a dividend for the intrinsic value of conversion options embedded in preferred
securities based upon the differences between the fair value of the underlying common stock at the commitment date of the transaction
and the effective conversion price embedded in the preferred shares.
Revenue
Recognition
We
recognize revenue under ASC 606, Revenue from Contracts with Customers (Topic 606). This guidance sets forth a five-step model
which depicts the recognition of revenue in an amount that reflects what we expect to receive in exchange for the transfer of
goods or services to customers.
We
recognize revenue when our performance obligations under the terms of a contract with the customer are satisfied. Product sales
occur once control of our products is transferred upon delivery to the customer. Revenue is measured as the amount of consideration
that we expect to receive in exchange for transferring goods and is presented net of provisions for customer returns and allowances.
The amount of consideration we receive and revenue we recognize varies with changes in customer incentives we offer to our customers
and their customers. Sales taxes and other similar taxes are excluded from revenue.
Distribution
expenses to transport our products, where applicable, and warehousing expense after manufacture are accounted for within operating
expenses.
Cost
of Goods Sold
Cost
of goods sold include the costs of products, packaging, transportation, warehousing, and costs associated with valuation allowances
for expired, damaged or impaired inventory.
Stock-Based
Compensation
We account for stock-based compensation in
accordance with ASC 718, "
Compensation - Stock Compensation"
and ASU 2018-07, "Improvements to Nonemployee
Share-Based Payment Accounting". Under the fair value recognition provisions, cost is measured at the grant date based on
the fair value of the award and is recognized as expense ratably over the requisite service period, which is generally the option
vesting period. The Company uses the Black-Scholes option pricing model to determine the fair value of stock options.
Income
Taxes
We
use the liability method of accounting for income taxes as set forth in ASC 740, "
Income Taxes"
.  Under
the liability method, deferred taxes are determined based on the temporary differences between the financial statement and tax
basis of assets and liabilities using tax rates expected to be in effect during the years in which the basis differences reverse.  We
record a valuation allowance when it is not more likely than not that the deferred tax assets will be realized.
Company
management assesses its income tax positions and records tax benefits for all years subject to examination based upon its evaluation
of the facts, circumstances and information available at the reporting date.  In accordance with ASC 740-10, for those
tax positions where there is a greater than 50% likelihood that a tax benefit will be sustained, our policy is to record the largest
amount of tax benefit that is more likely than not to be realized upon ultimate settlement with a taxing authority that has full
knowledge of all relevant information.
F-
11
Splash
Beverage Group, Inc.
Notes
to the Consolidated Financial Statements
Note
2 – Summary of Significant Accounting Policies, continued
Income
Taxes, continued
For
those income tax positions where there is less than 50% likelihood that a tax benefit will be sustained, no tax benefit will be
recognized in the financial statements. Company management has determined that there are no material uncertain tax positions as
of December 31, 2019 and 2018.
Advertising
We
conduct advertising for the promotion of our products. In accordance with ASC 720-35, advertising costs are charged to operations
when incurred; such amounts aggregated to $4,767 and $8,148 during the years ended December 31, 2019 and 2018, respectively.
Related
Parties
We
are indebted to certain members of our Board of Directors as of December 31, 2019 and 2018. Transactions between the Company and
its Board members are summarized in Notes 4 and 9.
Recent
Accounting Pronouncements
In
May 2014, the FASB issued ASU 2014-09, "
Revenue from Contracts with Customers
" (Topic 606). This
ASU supersedes the previous revenue recognition requirements in ASC Topic 605—Revenue Recognition and most industry-specific
guidance. The core principle within Topic 606 is to recognize revenues when promised goods or services are transferred to customers
in an amount that reflects the consideration expected to be received for those goods or services. Transition methods under ASU
2014-09 must be through either (i) retrospective application to each prior reporting period presented, or (ii) retrospective application
with a cumulative effect adjustment at the date of initial application.
On January 1, 2018, we adopted ASU 2014-09
Revenue from Contracts with Customers and all subsequent amendments to the ASU (collectively, "ASC 606"), using the
retrospective application with a cumulative effect adjustment at the date of initial application, which (i) creates a single framework
for recognizing revenue from contracts with customers that fall within its scope and (ii) revises when it is appropriate to recognize
a gain (loss) from the transfer of nonfinancial asset. The adoption did not have a material effect on our Consolidated Financial
Statements.
In February 2016, the FASB issued ASU
2016-02, "
Leases
" (Topic 842). We adopted the standard effective January 1, 2019 using the modified retrospective
method. The adoption of this standard resulted in recognition of a right-of-use asset and a lease liability, initially measured
at the present value of the lease payments, for all leases with a term greater than 12 months. When available, we would use the
rate implicit in the lease to discount lease payments to present value. However, our leases generally do not provide a readily
determinable implicit rate. Therefore, our management estimates the incremental borrowing rate to discount lease payments based
on the information at the lease commencement. The accounting for finance leases is substantially unchanged. Given the nature of
our operation, the adoption of Topic 842 did not have a material impact on our balance sheet, statement of operations, or liquidity.
Refer to Note 11 – Operating Lease Obligations for information regarding our adoption of Topic 842 and the Company's
undiscounted future lease payments and the timing of those payments.
F-
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Beverage Group, Inc.
Notes
to the Consolidated Financial Statements
Note
2 – Summary of Significant Accounting Policies, continued
Recent
Accounting Pronouncements, continued
Management
does not believe that any other recently issued, but not yet effective, accounting standards could have a material effect on the
accompanying financial statements. As new accounting pronouncements are issued, we will adopt those that are applicable under
the circumstances.
Management's Evaluation
Management has evaluated subsequent events
through the date the financial statements were issued.
Net
Loss Per Share
Basic
net loss per common share ("Basic EPS'') excludes dilution and is computed by dividing net loss by the weighted
average number of common shares outstanding during the year. Diluted net loss per common share ("Diluted EPS'')
reflects the potential dilution that could occur if stock options or other contracts to issue shares of common stock were exercised
or converted into common stock. The computation of Diluted EPS does not assume exercise or conversion of securities that would
have an anti-dilutive effect on net loss per common share
2019
2018
Numerator
Net loss applicable to common shareholders
$
(5,135,731
)
$
(3,823,913
)
Denominator
Weighted average number of common shares outstanding
42,154,948
36,108,948
Net loss per share (basic and diluted)
$
(0.12
)
$
(0.11
)
Note
3 – Going Concern
The accompanying financial statements have
been prepared on a going concern basis, which contemplates the realization of assets and the satisfaction of liabilities in the
normal course of business.  Our business operations have not yet generated significant revenues, and we have sustained net
losses of approximately $5.1 million and $3.8 million during the years ended December 31, 2019 and 2018, respectively, and have
an accumulated deficit of approximately $35.6 million and $30.5 million as of December 31, 2019 and 2018, respectively. In addition,
we have current liabilities in excess of current assets of approximately $9.8 million at December 31, 2019. Further, we are in
default on approximately $3.8 million of indebtedness, including accrued interest.
Our
ability to continue as a going concern in the foreseeable future is dependent upon our ability to generate revenues and obtain
sufficient long-term financing to meet current and future obligations and deploy such to produce profitable operating results.
Management has evaluated these conditions and plans to raise capital as needed and to generate revenues to satisfy our capital
needs. No assurance can be given that we will be successful in these efforts.
These
factors, among others, raise substantial doubt about our ability to continue as a going concern for a reasonable period of time.
These financial statements do not include any adjustments relating to the recoverability and classification of recorded asset
amounts or the amounts and classification of liabilities that might be necessary should we be unable to continue as a going concern.
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Beverage Group, Inc.
Notes
to the Consolidated Financial Statements
Note
4 – Notes Payable, Related Party Notes Payable, Convertible Bridge Loans Payable, Revenue Financing Arrangements and Bridge
Loan Payable
Notes
payable are generally nonrecourse and secured by all Company owned assets.
Interest
Notes Payable
Rate
2019
2018
In October 2013, we entered
    into a short-term loan agreement with an entity in the amount of $25,000. The note matured and in March 2020 the full outstanding
    principal balance of $25,000 and unpaid accrued interest of $11,345 was converted into 234,767 shares of common stock according
    to the Merger Agreement.
7
%
$
25,000
$
25,000
In February 2014, we entered into a 12-month
    term loan agreement with an individual in the amount of $200,000. The note included warrants for 68,146 shares of common stock
    at $0.73 per share.  The warrants expired on February 28, 2017 and none were exercised at that date. The note matured
    and remains unpaid.
15
%
150,000
150,000
In March 2014, we entered into a 12-month
    term loan agreement with an individual in the amount of $500,000.  The note included warrants for 681,461 shares
    of common stock at $0.92 per share. The warrants expired on February 28, 2017 and none were exercised at that date.  The
    note matured and in March 2020 the full outstanding principal balance of $500,000 and unpaid accrued interest of $373,065
    was converted into 1,124,802 shares of common stock according to the Merger Agreement.
15
%
500,000
500,000
In March 2014, we entered into a short-term
    loan agreement with an entity in the amount of $200,000. The note included warrants for 272,584 shares of common stock at
    $0.92 per share. The warrants expired on February 28, 2017 and none were exercised at that date. The loans matured and remain
    unpaid.
8
%
200,000
200,000
$
875,000
$
875,000
Interest
expense on notes payable was $105,966 and $115,250 for the years ended December 31, 2019 and 2018, respectively, and accrued interest
was $581,693 and $475,728 as of December 31, 2019 and 2018, respectively.
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Beverage Group, Inc.
Notes
to the Consolidated Financial Statements
Note
4 – Notes Payable, Related Party Notes Payable, Convertible Bridge Loans Payable, Revenue Financing Arrangements and Bridge
Loan Payable, continued
Interest
Related
    Parties Notes Payable
Rate
2019
2018
During 2012, we entered into
    two 6-month term loan agreements with an entity, totaling $150,000. The notes included warrants for 68,146 shares of common
    stock at $0.73 per share which expired unexercised in 2017. The note matured and in March 2020 the full outstanding principal
    balance of $41,500 and unpaid accrued interest of $31,515 was converted into 98,726 shares of common stock according to the
    Merger Agreement.
7
%
$
41,500
$
41,500
In March 2014, we entered into a $50,000
    12-month term loan agreement. The note included warrants for 136,292 shares of common stock at $0.92 per share. The warrants
    expired unexercised on February 28, 2017.  The note matured and in March 2020 the full outstanding principal balance
    of $50,000 and unpaid accrued interest of $24,145 was converted into 99,252 shares of common stock according to the Merger
    Agreement.
8
%
50,000
50,000
During 2015, we entered into a 12-month
    term loan agreement with an individual in the amount $250,000.  The note matured and in March 2020 the full outstanding
    principal balance of $250,000 and unpaid accrued interest of $101,850 was converted into 98,726 shares of common stock according
    to the Merger Agreement.
8
%
250,000
250,000
In February 2012, we entered into a loan
    agreement with an officer of the Company in the amount of $100. On September 25, 2018 an additional $10,500 loan agreement
    was entered into. The note matured and in March 2020 the full outstanding principal balance of $10,600 and unpaid accrued
    interest of $1,189 was converted into 15,734 shares of common stock according to the Merger Agreement.
7
%
10,600
10,600
During 2013, 2014, 2015, and 2016, we entered
    into several 12-month term loan agreements with an officer of the Company in the amounts of $57,000, $225,000, $105,000, and
    $9,000, respectively. The note matured and in March 2020 the full outstanding principal balance of $396,000 and unpaid accrued
    interest of $146,828 was converted into 727,344 shares of common stock according to the Merger Agreement.
7
%
396,000
396,000
Continued on next page
F-
15
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Beverage Group, Inc.
Notes
to the Consolidated Financial Statements
Note
4 – Notes Payable, Related Party Notes Payable, Convertible Bridge Loans Payable, Revenue Financing Arrangements and Bridge
Loan Payable, continued
Interest
Related Parties Notes Payable,
    continued
Rate
2019
2018
During 2012, 2013, 2014, and
    2016, we entered into 6-month term loan agreements with an officer of the Company in the amounts of $155,000, $210,000, $150,000
    and $40,000, all respectively. The notes included warrants for issuances of 204,438 shares of common stock at $0.92 per share.
    The warrants expired unexercised on March 1, 2017. The note matured and in March 2020 the full outstanding principal balance
    of $495,000 and unpaid accrued interest of $213,010 was converted into 942,504 shares of common stock according to the Merger
    Agreement.
7
%
495,000
495,000
During 2013, 2014 and 2017, we entered
    into 12-month term loan agreements with an officer of the Company in the amounts of $60,000, $50,000 and $10,000. The note
    matured and in March 2020 the full outstanding principal balance of $120,000 and unpaid accrued interest of $50,305 was converted
    into 228,328 shares of common stock according to the Merger Agreement.
7
%
120,000
120,000
During 2018, we entered into a long term
    note payable with an entity owned by an officer for $12,000 to be payable on July 10, 2020. In March 2020 the full outstanding
    principal balance of $12,000 and unpaid accrued interest of $1,050 was converted into 17,407 shares of common stock according
    to the Merger Agreement.
12
%
12,000
12,000
During 2019, we entered into a term note
    payable with an entity owned by an officer for $130,000 to be paid on August 8, 2019. The note matured and in March 2020 the
    full outstanding principal balance of $130,000 and unpaid accrued interest of $9,078 was converted into 182,525 shares of
    common stock according to the Merger Agreement.
12
%
130,000
-
$
1,505,100
$
1,375,100
Interest
expense on related party notes payable was $95,183 and $99,532 for the years ended December 31, 2019 and 2018, respectively, and
accrued interest was $546,362 and $426,740 as of December 31, 2019 and 2018, respectively.
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Splash
Beverage Group, Inc.
Notes
to the Consolidated Financial Statements
Note
4 – Notes Payable, Related Party Notes Payable, Convertible Bridge Loans Payable, Revenue Financing Arrangements and Bridge
Loan Payable, continued
Interest
Convertible Bridge Loans
    Payable
Rate
2019
2018
In May 2015, we entered into
    a 3-month term loan agreement with an individual in the amount of $100,000. The annual interest rate for this bridge loan
    was 32% for the first 90 days, and 4% thereafter, compounded monthly.
See left
$
100,000
$
100,000
In October 2015, we entered into a 3-month
    term loan agreement with two individuals in the amount of $25,000. On December 26, 2018, the outstanding principal and accrued
    interest of $14,388 was consolidated into a new $39,388 term loan due August 26, 2020. In March 2020 the full outstanding
    principal balance of $39,388 and unpaid accrued interest of $5,973 was converted into 59,694 shares of common stock according
    to the Merger Agreement.
12
%
39,388
39,388
In June 2015, we entered into a 3-month
    term loan with two individuals in the amount of $100,000. On December 26, 2018, the outstanding principal amount of $100,000
    and accrued interest of $64,307 was consolidated into a new $164,307 term loan due August 26, 2020. In March 2020 the full
    outstanding principal balance of $164,307 and unpaid accrued interest of $24,916 was converted into 249,013 shares of common
    stock according to the Merger Agreement.
12
%
164,307
164,307
Continued on next page
F-
17
Splash
Beverage Group, Inc.
Notes
to the Consolidated Financial Statements
Note
4 – Notes Payable, Related Party Notes Payable, Convertible Bridge Loans Payable, Revenue Financing Arrangements and Bridge
Loan Payable, continued
Interest
Convertible Bridge Loans
    Payable, continued
Rate
2019
2018
During 2016, 2017 and 2018,
    we entered into multiple loan agreements with an entity in varying amounts. On December 26, 2018, the outstanding principal
    of $235,500 and accrued interest of $155,861 was consolidated into a new $391,361 term due August 26, 2020. In March 2020
    the full outstanding principal balance of $391,361 and unpaid accrued interest of $43,823 was converted into 435,184 shares
    of common stock according to the Merger Agreement.
12
%
391,361
391,361
During 2016, we entered into 3-month term
    loan agreements with an individual totaling $20,000. The loan was extended to August 14, 2020. In March 2020 the full outstanding
    principal balance of $20,000 and unpaid accrued interest of $10,096 was converted into 41,336 shares of common stock according
    to the Merger Agreement.
9
%
20,000
20,000
During 2014 through 2018, we entered into
    convertible promissory note agreements with various terms ranging from 90 days to 18 months at 18% interest with an entity
    which were consolidated into one loan at 12% in 2018 totaling $795,137 with a due date of August 26, 2020. In March 2020 the
    full outstanding principal balance of $795,137 and unpaid accrued interest of $89,037 was converted into 884,174 shares of
    common stock according to the Merger Agreement.
12
%
795,137
795,137
During 2015 and 2016, we entered into a
    series of 3-month term convertible promissory note agreements at 18% interest with an entity which were consolidated into
    one loan at 12% in 2018 totaling $692,471 with a due date of August 26, 2020. In March 2020 the full outstanding principal
    balance of $692,471 and unpaid accrued interest of $77,541 was converted into 770,012 shares of common stock according to
    the Merger Agreement.
12
%
692,471
692,471
$
2,202,664
$
2,202,664
Interest
expense on the convertible bridge loans payable was $310,865 and $430,317 for the years ended December 31, 2019 and 2018, respectively,
and accrued interest was $439,344 and $489,015 as of December 31, 2019 and 2018, respectively.
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Beverage Group, Inc.
Notes
to the Consolidated Financial Statements
Note
4 – Notes Payable, Related Party Notes Payable, Convertible Bridge Loans Payable, Revenue Financing Arrangements and Bridge
Loan Payable, continued
Interest
Revenue Financing Arrangements
Rate
2019
2018
During August 2015, we entered into a 3-month term loan agreement
    with an entity in the amount of $50,000, with required daily payments of $999. We entered into two additional 3-month loan
    agreements with the entity in 2016 in the amounts of $60,000 and $57,000, with required daily payments of $928 and $713, respectively.   The
    term loans matured and remains unpaid.
10
%
28,032
28,032
During September 2016, the Company entered into a short-term loan agreement
    with an entity in the amount of $55,000 with required daily payments of $929. The note was paid off in 2019.
15
%
-
15,009
During November 2016, we entered into a short-term loan agreement with
    an entity in the amount of $55,000 with required daily payments of $1,299. The note was in default as of December 31, 2018.
    In 2019, we entered into a settlement agreement with monthly installment payments of $6,000.  The loan is scheduled
    to be fully repaid in 2020.
12
%
17,435
34,067
$
45,467
$
77,108
Interest
expense on the revenue financing arrangements was $2,577 and $11,132 for the years ended December 31, 2019 and 2018, respectively,
and accrued interest was $32,154 and $126,333 as of December 31, 2019 and 2018, respectively.
Bridge
Loan Payable
We
issued an additional bridge loan in October 2018 for $2 million with a one-year maturity to GMA Bridge Fund LLC ("GMA").
This bridge loan contains a 10% administration fee of which the full $200,000 was accrued at December 31, 2019 and included in
bridge loan payable, net. We incurred $271,670 of loan costs, which was fully amortized at December 31, 2019. Interest on the
bridge loan was 0.5% monthly for the first six months and 0.75% monthly for the next six months. At the same time the debt was
issued, we entered into a separate agreement in which GMA provided consulting services for one year ("Consulting Agreement").
We compensated GMA for the Consulting Agreement services by issuance of a warrant with a 5-year term to acquire 1,362,922 shares
of our common stock at an exercise price of $0.007 per share. The warrant vested immediately. The value of the warrant, based
on a Black-Scholes option pricing model, was $991,423 and was expensed in full in 2018. Interest expense on the bridge loan for
the years ended December 31, 2019 and 2018 was $137,637 and $28,603, respectively, and accrued interest at December 31, 2019 was
$166,240.
As part of the merger, these warrants were retired.
F-
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Beverage Group, Inc.
Notes
to the Consolidated Financial Statements
Note
4 – Notes Payable, Related Party Notes Payable, Convertible Bridge Loans Payable, Revenue Financing Arrangements and Bridge
Loan Payable, continued
Future
Minimum Debt Payments
Future
minimum debt payments under the Company's outstanding loans are as follows as of December 31, 2019:
Related
Party
Other
Total
2020
1,505,100
5,277,664
6,782,764
Thereafter
-
-
-
Total
$
1,505,100
$
5,277,664
$
6,782,764
Note
5 – Licensing Agreement and Royalty Payable
During
2012, we entered into an assignment agreement with ABG TapouT, LLC ("TapouT") to obtain the licensing rights of the
brand "TapouT" on energy drinks, energy shots, water, teas and sports drinks for beverages sold in the United States
of America, its territories, possessions, U.S. military bases and Mexico. Under the terms of the agreement, we are required to
pay ABG Tapout, LLC a 6% royalty on net sales (gross revenue less discounts and allowances). The agreement requires us to make
varying guaranteed minimum royalty payments in the total amount of $3,500,000 for the initial period of 5 years beginning in 2012.
The terms of the license agreement were subsequently amended on several occasions between 2012 and 2016. During April 2017, the
license agreement was again amended, to extend the term through December 31, 2018 with a 5-year renewal option if $5 million of
net sales were achieved in 2018. The amendment also stated we were required to make a $30,000 payment on the date of the executed
amendment, monthly payments of $30,000 starting on April 30, 2017 through December 31, 2017, and monthly payments of $26,484 starting
on January 31, 2018 through December 31, 2018. We did not achieve the minimum net sales requirement per the amendment terms for
2018. In 2019 the agreement was once again amended extending the term through December 31, 2019. Per the 2019 amendment, the Company
is required to make twelve monthly payments of $39,000. See Note 13.
The
unpaid amount of royalties was $39,000 and $21,062 as of December 31, 2019 and 2018, respectively. Guaranteed minimum royalty
payments totaled $468,000 and $326,750 for the years ended December 31, 2019 and 2018, respectively, which is included in other
general and administrative expenses.
Note
6 – Income Taxes
We
have evaluated the positive and negative evidence in assessing the realizability of its deferred tax assets. This assessment included
the evaluation of scheduled reversals of deferred tax liabilities, estimates of projected future taxable income and tax planning
strategies to determine which deferred tax assets are more likely than not to be realized in the future.
F-
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Beverage Group, Inc.
Notes
to the Consolidated Financial Statements
Note
6 – Income Taxes, continued
At December 31, 2019, our net operating loss
carryforward for Federal income tax purposes was approximately $23.2 million, which will be available to offset future taxable
income subject to potential annual limitations. If not used, these carry forwards will begin to expire in 2032, except for the
current year net operating loss generated which can be carried forward indefinitely.
There was no income tax expense or benefit
for the year ended December 31, 2019 and 2018 due to the full valuation allowance recorded in each period.
The
reconciliation of the income tax benefit is computed at the U.S. federal statutory rate as follows:
2019
2018
US federal statutory tax rate
21.00
%
21.00
%
Permanent differences
-6.56
%
-0.03
%
Change in valuation allowance
-14.44
%
-20.97
%
Total
0.00
%
0.00
%
The
tax effects of temporary differences which give rise to the significant portions of deferred tax assets or liabilities at December
31 are as follows:
2019
2018
Deferred tax assets:
Net operating losses
$
5,887,022
$
5,315,433
Deferred rent
1,381
-
Accrued expenses/interest expense limitation
962,838
641,141
Total deferred tax assets
6,851,241
5,956,574
Deferred tax liabilities:
Depreciation
(7,354
)
(7,666
)
Total deferred tax liabilities
(7,354
)
(7,666
)
Less: valuation allowance
(6,843,887
)
(5,948,908
)
Total net deferred tax liabilities
$
-
$
-
We
continually evaluate expiring statutes of limitations, audits, proposed settlements, changes in tax law and new authoritative
rulings. The open tax years subject to examination with respect to our operations are 2015 through 2019.
F-
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Beverage Group, Inc.
Notes
to the Consolidated Financial Statements
Note
7 – Deficiency in Stockholders' Equity
Common
Stock
In
2019, we issued 1,846,078 shares of our common stock in exchange for services provided to us. The shares were valued at $0.73
per share. We recognized share-based compensation expense of $1,354,500, which is classified within the contracted services line
on the Statement of Operations.
In 2018, we issued 906,090 shares of common
stock valued at $0.73 per share in exchange for services provided to the Company.
On May 28, 2018, we issued to a consultant
or its designees common stock equal to 718,682 shares in exchange for services provided to the Company.
In December 2018, the full outstanding principal
balance of a bridge note of $175,000 and unpaid accrued interest balance of $144,410 was converted to 290,220 shares of the Company's
common stock at $1.10 per share.
In October 2018, the full outstanding principal
balance of a bridge note of $200,000 and unpaid accrued interest balance of $165,040 was converted to 331,681 shares of the Company's
common stock at $1.10 per share.
Certain common shareholders have the right
to exchange their common shares for shares of preferred stock or convertible debt if the Company is unable to achieve the capital
raise event as defined in the Merger Agreement by September 30, 2020 (see Note 13). Shares would consist of:
·
Series
                                         A Convertible Preferred Stock – 6,276,432
·
Series
                                         B Convertible Preferred Stock – 7,653,981
·
Convertible
                                         Debt – 10,560,090
As
of December 31, 2019, the convertible debt was still classified as debt on the balance sheet.
Series
A and B Convertible Preferred Stock
As part of the merger consummated on March
31, 2020, all series A and B convertible preferred stock were converted to common stock. If the Company is unable to achieve the
capital raise event as defined in the Merger Agreement by September 30, 2020, these shareholders can rescind their common shares
back to preferred shares. Below are the new rights to these shareholders if they decide to rescind:
Series
A Convertible Preferred Stock
:
Rank. The Series A Preferred Stock shall rank, with respect
to dividend rights and to rights upon any voluntary or involuntary liquidation, dissolution or winding up of the Company (each,
a "Liquidation Event"), (a) senior in preference and priority to the common stock of the Company (the "Common
Stock") and any other class or series of equity security established and designated by the Board of Directors the terms of
which do not expressly provide that it ranks senior in preference or priority to or on parity with the Series A Preferred Stock
with respect to dividend rights and rights upon a Liquidation Event (collectively, "Junior Securities"), (b) on parity,
without preference or priority, with each other class or series of equity security established and designated by the Board of Directors
the terms of which expressly provide that it ranks on parity, without preference or priority to, the Series A Preferred Stock with
respect to dividend rights and rights upon a Liquidation Event (collectively, "Parity Securities"), and (c) junior
in preference and priority to each other class or series of equity security established and designated by the Board of Directors
the terms of which expressly provide that it ranks senior in preference or priority to the Series A Preferred Stock with respect
to dividend rights and rights upon a Liquidation Event (collectively, "Senior Securities").
Dividends.
Holders of shares of the Series A Preferred Stock are entitled to receive, when, as and if declared by the Board, out of funds
legally available for the payment of dividends, cumulative cash dividends at an annual rate of eight percent (8%) of the Original
Issue Price per share (equal to $.08 per share per annum). Dividends shall accrue on each share of Series A Preferred Stock from
the date of issuance thereof, whether paid or not, and shall be cumulative and compounded annually.
Liquidation
Preference. In the event of any Liquidation Event, the holders of shares of Series A Preferred Stock then outstanding shall be
entitled to be paid out of the assets of the Company available for distribution to its stockholders before any payment shall be
made to the holders of any Junior Securities by reason of their ownership thereof, an amount per share equal to one hundred fifty
percent (150%) of the Series A Original Issue Price (the "Liquidation Preference"), plus the amount of accrued and
unpaid dividends thereon from the Original Issue Date through the date of liquidation. If upon any such Liquidation Event the
assets of the Company available for distribution to its stockholders shall be insufficient to pay the holders of shares of Series
A Preferred Stock the full amount to which they shall be entitled under this, the holders of shares of Series A Preferred Stock
and Parity Securities shall share ratably in any distribution of the assets available for distribution in proportion to the respective
amounts which would otherwise be payable in respect of the shares held by them upon such distribution if all amounts payable on
or with respect to such shares were paid in full.
Conversion.
The holders of Series A Preferred Stock shall have conversion rights as follows (the "Conversion Rights"):
Optional
Conversion. Each share of Series A Preferred Stock shall be convertible, at the option of the holder thereof, at any time and
from time to time, into such number of fully paid and non-assessable shares of Common Stock as is determined by dividing the Series
A Original Issue Price by the Conversion Price (as defined below) in effect at the time of conversion. The Conversion Price at
which shares of Common Stock shall be deliverable upon conversion of Series A Preferred Stock without the payment of additional
consideration by the holder thereof (the "Conversion Price") shall initially be $1.28 per share. Such initial Conversion
Price, and the rate at which shares of Series A Preferred Stock may be converted into shares of Common Stock, shall be subject
to adjustment as provided below. All accrued and unpaid dividends may be converted by each holder of Series A Preferred Stock
into Common Stock by first determining the number of shares of Series A Preferred Stock that could be purchased based on the Series
A Original Issue Price then in effect and then determining the number of shares of Common Stock such additional shares of Series
A Preferred Stock are convertible into. By way of illustration only, if the accrued and unpaid dividends are equal to $100,000,
then based on the Series A Original Issue Price of $1.00 and a Conversion Price of $0.85, the holders of Series A Preferred Stock
would receive an additional 85,000 shares of Common Stock.
Automatic
Conversion. Upon the consummation of an underwritten public offering of the Common Stock of the Company ("IPO") ,
each share of Series A Preferred Stock shall automatically be converted into such number of fully paid and non-assessable shares
of Common Stock at a Conversion Price equal to the lesser of (i) the Conversion Price in effect immediately prior to the consummation
of the IPO or (ii) fifty percent (50%) of the public offering price of the Common Stock in the IPO. All accrued and unpaid dividends
may be converted by each holder of Series A Preferred Stock into Common Stock by first determining the number of shares of Series
A Preferred Stock that could be purchased based on the Series A Original Issue Price then in effect and then determining the number
of shares of Common Stock such additional shares of Series A Preferred Stock are convertible into. By way of illustration only,
if the accrued and unpaid dividends are equal to $100,000, then based on the Series A Original Issue Price of $1.00 and a Conversion
Price of $0.85, the holders of Series A Preferred Stock would receive an additional 85,000 shares of Common Stock.
Series
B Convertible Preferred Stock
:
Rank.
The Series B Preferred Stock shall rank, with respect to dividend rights and to rights upon any voluntary or involuntary liquidation,
dissolution or winding up of the Company (each, a "Liquidation Event"), (a) senior in preference and priority to the
common stock of the Company (the "Common Stock") and any other class or series of equity security established
and designated by the Board of Directors the terms of which do not expressly provide that it ranks senior in preference or priority
to or on parity with the Series B Preferred Stock with respect to dividend rights and rights upon a Liquidation Event (collectively,
"Junior Securities"), (b) on parity, without preference or priority, with the Series A Preferred Stock and with each
other class or series of equity security established and designated by the Board of Directors the terms of which expressly provide
that it ranks on parity, without preference or priority to, the Series B Preferred Stock with respect to dividend rights and rights
upon a Liquidation Event (collectively, "Parity Securities"), and (c) junior in preference and priority to each other
class or series of equity security established and designated by the Board of Directors the terms of which expressly provide that
it ranks senior in preference or priority to the Series B Preferred Stock with respect to dividend rights and rights upon a Liquidation
Event (collectively, "Senior Securities").
Dividends.
The holders of the Series B Preferred Stock shall be entitled to receive cash dividends, when, as and if declared by the Board,
out of any assets legally available therefor, prior and in preference to any declaration or payment of any dividend on any other
class of Preferred Stock, except for the Series A Preferred Stock which shall be paid at the same time as the Series B Preferred
Stock is paid, and Common Stock of the Corporation at an annual rate of nine percent (9%) of the Original Issue Price per share
(equal to $.09 per share per annum) payable out of legally available funds. Dividends shall accrue on each share of Series B Preferred
Stock from the date of issuance thereof, whether paid or not, and shall be cumulative and compounded annually. Such dividends
shall be payable on the first day of each January, April, July and October commencing with respect to each share of Series B Preferred
Stock, on the first of such dates to occur after the issuance of such share (each such date a "Dividend Payment Date")
to the holders of record at the close of business on the fifteenth day of each December, March, June and September, respectively,
subject to declaration of such dividends by the Board. All dividends paid with respect to shares of Series B Preferred Stock shall
be paid pro rata to the holders entitled thereto. Dividends, if paid, must be paid, on all outstanding shares of Series B Preferred
Stock contemporaneously. If any dividend shall not be paid on a Dividend Payment Date, for any reason, the right of the holders
to receive such dividend shall not lapse or terminate but each such dividend shall accrue and be paid to such holders, subject
to the conversion provisions below. No dividend shall be paid to the holders of any shares of Common Stock until all dividends,
including accrued dividends, then owing to the holders of Series B Preferred Stock, shall have been paid in full.
Liquidation
Preference. In the event of any Liquidation Event, the holders of shares of Series B Preferred Stock then outstanding shall be
entitled to be paid out of the assets of the Company available for distribution to its stockholders before any payment shall be
made to the holders of any Junior Securities by reason of their ownership thereof, an amount per share equal to one hundred fifty
percent (150%) of the Series B Original Issue Price (the "Liquidation Preference"), plus the amount of accrued and
unpaid dividends thereon from the Original Issue Date through the date of liquidation. If upon any such Liquidation Event the
assets of the Company available for distribution to its stockholders shall be insufficient to pay the holders of shares of Series
B Preferred Stock the full amount to which they shall be entitled under this Section , the holders of shares of Series B Preferred
Stock and Parity Securities shall share ratably in any distribution of the assets available for distribution in proportion to
the respective amounts which would otherwise be payable in respect of the shares held by them upon such distribution if all amounts
payable on or with respect to such shares were paid in full.
Conversion.
The holders of Series B Preferred Stock shall have conversion rights as follows (the "Conversion Rights"):
Optional
Conversion. Each share of Series B Preferred Stock shall be convertible, at the option of the holder thereof, at any time and
from time to time, into such number of fully paid and non-assessable shares of Common Stock as is determined by dividing the Series
B Original Issue Price by the Conversion Price (as defined below) in effect at the time of conversion. The Conversion Price at
which shares of Common Stock shall be deliverable upon conversion of Series B Preferred Stock without the payment of additional
consideration by the holder thereof (the "Conversion Price") shall initially be $1.28 per share. Such initial Conversion
Price, and the rate at which shares of Series B Preferred Stock may be converted into shares of Common Stock, shall be subject
to adjustment as provided below. All accrued and unpaid dividends may be converted by each holder of Series B Preferred Stock
into Common Stock by first determining the number of shares of Series B Preferred Stock that could be purchased based on the Series
B Original Issue Price then in effect and then determining the number of shares of Common Stock such additional shares of Series
B Preferred Stock are convertible into. By way of illustration only, if the accrued and unpaid dividends are equal to $100,000,
then based on the Series B Original Issue Price of $1.50 and a Conversion Price of $1.28, the holders of Series B Preferred Stock
would receive an additional 78,125 shares of Common Stock.
Automatic
Conversion. Upon the consummation of an underwritten public offering of the Common Stock of the Company ("IPO"), each
share of Series B Preferred Stock shall automatically be converted into such number of fully paid and non-assessable shares of
Common Stock at a Conversion Price equal to the lesser of (i) the Conversion Price in effect immediately prior to the consummation
of the IPO or (ii) fifty percent (50%) of the public offering price of the Common Stock in the IPO. All accrued and unpaid dividends
may be converted by each holder of Series B Preferred Stock into Common Stock by first determining the number of shares of Series
B Preferred Stock that could be purchased based on the Series B Original Issue Price then in effect and then determining the number
of shares of Common Stock such additional shares of Series B Preferred Stock are convertible into. By way of illustration only,
if the accrued and unpaid dividends are equal to $100,000, then based on the Series B Original Issue Price of $1.50 and a Conversion
Price of $1.28, the holders of Series B Preferred Stock would receive an additional 78,125 shares of Common Stock.
Undesignated Preferred Stock
The Company has the ability to authorize
Series A and Series B Convertible Preferred Stock.
Treasury Stock
Since its inception, we have repurchased shares
from our shareholders. To date, we have repurchased 1,226,630 shares, of which 817,753 have been retired.
In connection with a 2018 consulting agreement,
we are committed to issue 408,877 shares held in treasury upon the occurrence of certain events or milestones. We issued, out
of treasury, 136,292 shares in July 2018 and 136,292 shares in July 2019.
Warrant Issuance-Common Stock
As part of the sale and issuance of 3,913,414
shares of our Series B Convertible Preferred Stock of SBG, we issued warrants to purchase 2,666,837 shares of our common stock
at a price of $1.10 per share. The warrants have a 5-year term. At December 31, 2019, there are 2,593,486 warrants outstanding
with a weighted average remaining life of 0.9 years.
F-
22
Splash
Beverage Group, Inc.
Notes
to the Consolidated Financial Statements
Note
8 – Share-Based Payments
Warrant Issuance-Loan Agreements
In 2014, the Company issued seven (7)
warrants for the purchase of 1,362,922 shares of the Company's common stock. The warrants were issued with various loan
agreements as described above in Note 4. Two warrants for a total of 136,292 shares of common stock were issued with exercise
prices of $0.73 per share and five warrants for a total of 1,226,630 shares of common stock were issued with an exercise price
of $0.92 per share. The Company estimated the fair value of the warrants totaling $161,626 based on its estimate of the fair value
of the Company's common stock at the issuance date, an average risk-free interest rate of 1.69%, the estimated life of half
of the term of the warrant, a zero dividend yield and, a volatility rate of 50%, which was recorded as a discount to the notes
and amortized over the notes' lives under the effective interest rate method. The fair value of the warrants were expensed
over the life of the loans which was 12 months. These warrants have expired as of December 31, 2018.
Warrant
Issuance-GMA Consulting Services
During 2018,
we
issued warrants to purchase 1,362,922 shares of our common stock at $0.007 per share as part of our consulting agreement with
GMA (see Note 4), At December 31, 2019, the weighted average life of the outstanding warrants is 3.75 years.
The
warrants entitle the holder to purchase one share per warrant of the Company's common stock at a price of $0.007 per share
during the five-year period commencing on October 2, 2018, or, if greater, the number of common shares with a market value equivalent
to two percent of the enterprise value of the Company at an exercise price of $0.006 per share.
Stock
Plan
We
have adopted the 2012 Stock Incentive Plan (the "Plan"), which provides for the grant of common stock and stock options
to employees. We have reserved 4,088,765 shares for issuance under the Plan. The option exercise price generally may not be less
than the underlying stock's fair market value at the date of the grant and generally have a term of ten years. On December
31, 2018, the sole option holder at the time, our CEO, exercised his options to purchase 2,657,698 shares of common stock at a
purchase price of $0.12 per share, totaling $312,000, which total purchase price was paid by the cancelation of the equivalent
amount of debt owed by us to the CEO. On December 7, 2019, our Board of Directors granted 1,124,410 options to certain employees
and consultants. None of these options were exercised at December 31, 2019. There are 1,124,410 options issued and outstanding
under the Plan at December 31, 2019. As of December 31, 2019, the total number of options available for grant is 306,657.
F-
23
Splash
Beverage Group, Inc.
Notes
to the Consolidated Financial Statements
Note
8 – Share-Based Payments, continued
Stock
Plan, continued
We
measure employee stock-based awards at the grant-date fair value and recognizes employee compensation expense on a straight-line
basis over the vesting period of the award. Determining the appropriate fair value of stock-based awards requires the input of
subjective assumptions, including the fair value of our common stock, and for stock options, the expected life of the option,
and expected stock price volatility and exercise price. We used the Black-Scholes option pricing model to value its stock option
awards. The assumptions used in calculating the fair value of stock-based awards represent management's best estimates and
involve inherent uncertainties and the application of management's judgment. As a result, if factors change and management
uses different assumptions, stock-based compensation expense could be materially different for future awards. The expected life
of stock options was estimated using the "simplified method," which calculates the expected term as the midpoint between
the weighted average time to vesting and the contractual maturity, we have limited historical information to develop reasonable
expectations about future exercise patterns and employment duration for its stock options grants. The simplified method is based
on the average of the vesting tranches and the contractual life of each grant. For stock price volatility, we use comparable public
companies as a basis for its expected volatility to calculate the fair value of options granted. The risk-free interest rate is
based on U.S. Treasury notes with a term approximating the expected life of the option. The estimation of the number of stock
awards that will ultimately vest requires judgment, and to the extent actual results or updated estimates differ from the Company's
current estimates, such amounts are recognized as an adjustment in the period in which estimates are revised.
We
recognized stock-based compensation expense of $265,589 and $0 for the years ended December 31, 2019 and 2018, respectively. There
was no unrecognized compensation cost related to stock option awards at December 31, 2019.
A
summary of information related to stock options for the years ended December 31, 2019 and 2018 is as follows:
December
    31, 2019
December
    31, 2018
Weighted Average
Weighted Average
Options
Exercise
    Price
Options
Exercise
    Price
Outstanding - beginning of year
-
$
-
2,657,698
$
0.12
Granted
1,124,410
$
0.73
.
Exercised
-
$
-
(2,657,698
)
$
(0.12
)
Cancelled/forfeited
-
$
-
-
Outstanding - end of year
1,124,410
$
0.73
-
Exercisable at end of year
1,124,410
$
0.73
-
Weighted average grant date
    fair value of options during year
N/A
N/A
Weighted average duration to
    expiration of outstanding options at year-end
5.0
N/A
F-
24
Splash
Beverage Group, Inc.
Notes
to the Consolidated Financial Statements
Note
9 – Related Parties
During
the normal course of business, we incurred expenses related to services provided by our CEO or Company expenses paid by our CEO,
resulting in related party payables, net of $429,432 and $302,934 as of December 31, 2019 and 2018, respectively. The related
party payable to the CEO bears no interest payable and is due on demand.
During 2018, $312,000 of the related party
was paid in kind as the CEO exercised 2,657,698 options to acquire common stock at $0.12 per share against the payable.
There
are related party notes payable of $1,505,100 and $1,375,100 outstanding as of December 31, 2019 and 2018, respectively, as discussed
in Note 4.
Note
10 – Investment in Salt Tequila USA, LLC
On
December 9, 2013, we entered into a marketing and distribution agreement with SALT Tequila USA, LLC ("SALT") in Mexico
for the manufacturing of our product line. The agreement was for a one-year term with an additional two-year renewal. On December
28, 2015, the agreement was extended through 2020. In the December 9, 2013 agreement, we received a 5% ownership interest in SALT,
12 months after the date of the agreement we received an additional 5% ownership interest in SALT, and 24 months after the date
of the agreement we received an additional 5% interest, resulting in a total interest of 15% in SALT. We have not recorded the
cost of the investment or our share of its results of operations as the amounts are considered immaterial.
SALT also has sold product to an unrelated
international alcohol distributor, American Spirits Exchange, for preliminary market testing in 9 of 16 states that they distribute
to, that are government-controlled alcohol resellers. In 2018 and 2019 we had no sales of SALT Tequila. On December 31, 2018,
we created a Mexican subsidiary, Splash MEX SA DE CV ("Splash Mex") for the exporting of SALT Tequila from Mexico
to the USA, South and Central Americas. Splash Mex will also act as the manufacturing and distribution agent of TapouT in Central
and South Americas. Applications for the appropriate licenses required for import and wholesale of alcohol in the USA have been
completed for at the Federal and State levels. These licenses will permit direct alcohol sales to distributors and wholesalers
thereby limiting the use of agents for importing SALT Tequila to the USA for distribution.
Note
11 – Operating Lease Obligations
Effective
July 2018, we entered into a lease agreement for the right to use and occupy office space. The lease term commenced July 1, 2018
and is scheduled to expire after 36 months, on June 30, 2021.
Total rent expense for the ten months, beginning in March,
in 2018 was $32,855.
Prior to the current lease, we entered into
a lease agreement in 2014 for the right to use and occupy office space. The lease term commenced November 1, 2014 and was scheduled
to expire after 62 months, on December 31, 2019. The lease was terminated in February 2018. Total rent expense for the two months
in 2018 was $19,641.
Effective
November 2019, we entered into a new lease agreement for our NY affiliate. The lease is for six months and will expire on April
30, 2020. This lease was not subjected to the new lease standard, Topic 842.
F-
25
Splash
Beverage Group, Inc.
Notes
to the Consolidated Financial Statements
Note
11 – Operating Lease Obligations, continued
Effective
November 2019, we entered into a new lease with Interport Logistics, LLC. The lease term commenced on November 11, 2019 and is
scheduled to expire on November 11, 2020. This lease was subjected to the new lease standard, Topic 842.
Effective
May 2019, we entered into a new lease in Mexico. The lease commenced May 1, 2019 and is scheduled to expire after 24 months, on
April 1, 2021. This lease was subjected to the new lease standard, Topic 842.
The
following table presents a reconciliation of the undiscounted future minimum lease payments, under the leases for our office and
warehouses to the amounts reported as financial lease liabilities on the consolidated balance sheet at December 31, 2019:
Undiscounted Future Minimum Lease Payments
Operating
    Lease
2020
$
87,734
2021
59,291
Thereafter
25,911
Total
172,936
Amount representing imputed interest
(9,196
)
Total operating lease liability
163,740
Current portion of operating lease liability
(81,502
)
Operating lease liability, non-current
$
82,238
The
table below presents information for lease costs related to our operating leases at December 31, 2019:
Operating lease cost:
Amortization of leased assets
$
52,692
Interest of lease liabilities
5,716
Total operating lease cost
$
58,408
The
table below presents lease-related terms and discount rates at December 31, 2019:
Remaining term on leases
16 to 34 months
Incremented borrowing rate
5.0%
F-
26
Splash
Beverage Group, Inc.
Notes
to the Consolidated Financial Statements
Note
12 - Contingencies
We
are a party to asserted claims and are subject to regulatory actions in the ordinary course of business. The results of such proceedings
cannot be predicted with certainty, but the Company does not anticipate that the outcome, if any, arising out of any such matter
will have a material adverse effect on its business, financial condition or results of operations.
Litigation
On
April 24, 2017, a note holder filed a complaint against the Company for a promissory note in default. The note holder is requesting
summary judgment in the amount of $246,632.
Note
13 – Subsequent Events
TapouT Licensing Agreement
Effective January 1, 2020, we have amended
our license agreement with TapouT as previously disclosed in Note 5. The agreement has been extended through December 31, 2022.
Under the terms of the amendment, we are required to make guaranteed minimum royalty monthly payments of $45,000 through December
31, 2022. We also are required to meet a minimum net sales threshold of $9,000,000 for 2020. There can be no assurance that the
net sales threshold will be achieved, or that further amendments to the agreement will be executed for it to remain effective
in 2021 and later periods.
SALT Tequila Purchase Agreement
On March 26, 2020, we entered into a new
amended stock sale and purchase agreement. The agreement is for $1,000,000 to be paid in 4 tranches of $250,000 and entitles us
to additional equity interest in Salt Tequila USA, LLC as follows:
●
Tranche 1 – 7.5%
●
Tranche 2 – 5.0%
●
Tranche 3 – 5.0%
●
Tranche 4 – 5.0%
Once all tranches are paid-out we will
have a total equity stake of 37.5% of Salt Tequila USA, LLC.
Merger with Canfield Medical Supply,
Inc.
As previously described in Note 1, Splash
entered into a Merger Agreement with CMS. Upon completion of the merger, the Splash shareholders collectively own, as a group,
on a fully diluted basis approximately 85% of the combined company.
The Merger Agreement was consummated on
March 31, 2020. As part of the merger, pursuant to a Promissory Note Conversion Agreement, all outstanding debt of Splash, except
for $450,000 in principal, was converted in common shares of the combined entity. Under the Promissory Note Conversion Agreement,
if the Company shall fail to raise $9,000,000 of additional capital no later than six months from the date of the Merger, then
the holder may seek to rescind the Promissory Note Conversion Agreement, return the Note Conversion Shares and receive a replacement
promissory note from the Company.
In addition, in connection with the Merger,
pursuant to Preferred Stock Conversion Agreements, all Series A Convertible Preferred Stock and Series B Convertible Preferred
Stock, and accreted dividends of Splash were converted into common shares of the combined entity, and have been reflected as outstanding
for all periods presented. Under the Preferred Stock Conversion Agreement, if the Company shall fail to raise $9,000,000 of additional
capital no later than six months from the date of the Merger, then the holder may seek to rescind the Preferred Stock Conversion
Agreement, return the Preferred Stock Conversion Shares and receive replacement shares of preferred stock from the Company.
Alcohol License
On February 4, 2020 we received a Florida
Alcohol License. This license gives us the ability to import and sell liquor within the United States.
Warrant Expiration
Subsequent to December 31, 2019, warrants
to purchase 754,741 shares of our common stock have expired.
Mezzanine Equity
As part of the merger, dated March 31,
2020, we converted the majority of our debt into equity. As stated in the debt conversion agreements, each debt holder can convert
their shares back to debt if we are not able to adequately raise $9,000,000 additional capital within six months of the date of
the merger. As a result, these shares have been classified as mezzanine equity in the consolidated balance sheet on March 31, 2020.
Q1 2020 Notes Received
During the first quarter of 2020, we received
$1.5 million from one of our shareholders to be used to finance the operations of the Company. As part of the merger, the entire
$1.5 million was converted into mezzanine equity.
F-
27
Splash Beverage
Group, Inc.
[f/k/a Canfield Medical Supply, Inc.]
Condensed
Consolidated Financial Statements
June
30,
2020
F-
28
Splash
Beverage Group, Inc.
[f/k/a Canfield Medical Supply, Inc.]
Condensed
Consolidated Balance Sheets
June
30, 2020 and December 31, 2019
(Unaudited)
June 30, 2020
December 31, 2019
Assets
Current assets:
Cash and cash equivalents
$
118,751
$
42,639
Accounts Receivable, net
359,657
11,430
Prepaid Expenses
19,114
5,449
Inventory
479,230
304,012
Other receivables
9,544
7,132
Total current assets
986,296
370,662
Non-current assets:
Deposit
$
56,366
$
34,915
Goodwill
9,448,852
—
Investment in Salt Tequila USA, LLC
250,000
—
Right of use asset, net
130,101
162,008
Property and equipment, net
64,269
37,729
Total non-current assets
9,948,049
234,652
Total assets
$
10,935,884
$
605,314
Liabilities and Deficiency in Stockholders' Equity
Liabilities:
Current liabilities
Accounts payable and accrued expenses
$
1,118,582
$
703,885
Right of use liability - current
89,950
81,502
Due to related parties
517,875
429,432
Bridge loan payable, net
—
2,200,000
Related party notes payable
—
1,505,100
Convertible Loan Payable
100,000
2,202,664
Notes payable, current portion
539,611
875,000
Royalty payable
90,000
39,000
Revenue financing arrangements
12,710
45,467
Shareholder advances
88,000
46,250
Accrued interest payable
805,602
1,604,498
Accrued interest payable - related parties
—
546,362
Total current liabilities
3,362,330
10,279,160
Long-term Liabilities:
Related party notes payable - noncurrent
64,200
—
Right of use liability - noncurrent
40,151
82,238
Total long-term liabilities
104,351
82,238
Total liabilities
3,466,681
10,361,398
Common stock, (mezzanine shares) 12,605,283 shares, contingently convertible to notes payable at June 30, 2020
9,248,720
—
Deficiency in stockholders' equity:
Common Stock, $0.001 par, 100,000,000 shares authorized, 57,002,247 and 44,021,382 shares
issued 57,002,247 and 43,885,090 outstanding, at June 30, 2020 and December 31, 2019, respectively
57,002
44,021
Additional paid in capital
34,898,641
22,095,403
Treasury Stock, $0.001 par, 136,292 shares at cost
—
(50,000
)
Accumulated deficit
(36,735,159
)
(31,845,508
)
Total deficiency in stockholders' equity
(1,779,517
)
(9,756,084
)
Total liabilities, mezzanine shares and deficiency in stockholders' equity
$
10,935,884
$
605,314
The
accompanying notes are an integral part of these condensed consolidated financial statements.
F-
29
Splash
Beverage Group, Inc.
[f/k/a Canfield Medical Supply, Inc.]
Condensed
Consolidated Statements of Operations
For the Three- and Six- Months Ended June
30, 2020 and 2019
(Unaudited)
Three months ended June 30, 2020
Three months ended June 30, 2019
Six months ended June 30, 2020
Six months ended June 30, 2019
Net revenues
$
612,308
$
42,775
$
724,311
$
48,105
Cost of goods sold
(287,773
)
(48,215
)
(394,987
)
(74,418
)
Gross margin
324,535
(5,440
)
329,324
(26,313
)
Operating expenses:
Contracted services
165,697
179,714
423,678
430,770
Salary and wages
365,013
16,378
606,689
412,262
Other general and administrative
156,258
79,456
1,189,671
301,843
Sales and marketing
24,230
27,164
47,242
32,652
Total operating expenses
711,198
302,712
2,267,280
1,177,527
Loss from operations
(386,663
)
(308,152
)
(1,937,956
)
(1,203,840
)
Other income/(expense):
Interest income
205
—
16,356
—
Interest expense
(21,854
)
89,763
(1,935,491
)
(420,524
)
Gain from debt extinguishment
34,962
—
34,962
—
Total other income/(expense)
13,313
89,763
(1,884,172
)
(420,524
)
Provision for income taxes
—
—
—
—
Net loss
$
(373,350
)
$
(218,389
)
$
(3,822,129
)
$
(1,624,364
)
Net loss per share (basic and diluted)
$
(0.01
)
$
(0.01
)
$
(0.07
)
$
(0.04
)
Weighted average number of common shares outstanding
56,908,703
41,807,563
51,113,403
41,603,074
The
accompanying notes are an integral part of these condensed consolidated financial statements.
F-
30
Splash
Beverage Group, Inc.
[f/k/a Canfield Medical Supply, Inc.]
Condensed
Consolidated Statement of Deficiency in Stockholders' Equity
For
the six months ended June 30, 2020 and 2019
(Unaudited)
Total
Common Stock
Treasury Stock
Additional
Accumulated
Stockholders'
Shares
Amount
Shares
Amount
Paid-In Capital
Deficit
Equity (Deficit)
Balances at December 31, 2018
40,165,002
40,165
272,585
$
(100,000
)
$
18,938,480
$
(26,709,776
)
$(7,831,132)
Issuance of Common stock for cash
27,258
27
—
—
19,973
—
$20,000
Issuance of Common stock for services
1,363
1
—
—
999
—
1,000
Share-based compensation
—
—
—
—
—
—
-
Net loss
—
—
—
—
—
(703,624
)
(703,624)
Balances at March 31, 2019
40,193,623
40,193
272,585
$
(100,000
)
$
18,959,452
$
(27,413,400
)
$(8,513,755)
Issuance of Common stock for cash
483,837
484
—
—
354,516
—
$355,000
Issuance of Common stock for services
—
—
—
—
—
—
-
Issuance of series B convertible preferred stock
—
—
—
—
—
—
-
Issuance of Common stock from treasury
—
—
—
—
—
—
-
Warrants issued in connection with debt modification
—
—
—
—
—
—
-
Share-based compensation
—
—
—
—
—
—
-
Net loss
—
—
—
—
—
(921,520
)
(921,520)
Balances at June 30, 2019
40,677,460
40,677
272,585
$
(100,000
)
$
19,313,968
$
(28,334,920
)
$(9,080,275)
Common Stock
Treasury Stock
Additional
Accumulated
Total
Stockholders'
Shares
Amount
Shares
Amount
Paid-In Capital
Deficit
Equity (Deficit)
Balances at December 31, 2019
44,021,389
44,021
136,293
$
(50,000
)
$
22,095,403
$
(31,845,506
)
$(9,756,084)
Issuance of common stock for convertible debt
—
—
—
—
145,579
—
145,579
Incremental beneficial conversion for preferred A
—
—
—
—
240,770
(240,770
)
-
Issuance of warrants on convertible instruments
—
—
—
—
2,486,706
(828,903
)
1,657,803
Issuance of common stock for services
817,753
818
(136,293
)
50,000
549,182
—
600,000
Issuance of common stock for acquisition
11,913,200
11,913
—
—
9,161,251
—
9,173,164
Net loss
—
—
—
—
—
(3,446,630
)
(3,446,630)
Balances at March 31, 2020
56,752,342
56,752
—
$
—
$
34,678,891
$
(36,361,809
)
$(1,626,167)
Issuance of warrants
—
—
—
—
77,434
—
77,434
Issuance of common stock for services
—
—
—
—
—
-
Issuance of common stock for cash
249,912
250
—
—
142,316
—
142,566
Net loss
—
—
—
—
(373,350
)
(373,350)
Balances at June 30, 2020
57,002,254
57,002
—
$
—
$
34,898,641
$
(36,735,159
)
$(1,779,517)
The
accompanying notes are an integral part of these condensed consolidated financial statements.
F-
31
Splash
Beverage Group, Inc.
[f/k/a Canfield Medical Supply, Inc.]
Condensed
Consolidated Statement Cash Flows
For the Six Months Ended June 30, 2020 and
2019
(Unaudited)
Six months ended June 30, 2020
Six months ended June 30, 2019
Net loss
$
(3,822,129
)
$
(1,624,364
)
Adjustments to reconcile net loss to net cash
used in operating activities:
Depreciation and amortization
13,045
4,711
Amortization of ROU Asset
39,684
502
Debt discount
(5,222
)
_
Gain from debt extinguishment
(34,962
)
—
Interest on notes payable converted to common stock
231,692
—
Interest expense due to the issuance of warrants
1,657,805
—
Share-based compensation
—
—
Shares issued in exchange for services
600,000
1,000
Other noncash charges
(252,280
)
—
Changes in working capital items:
—
Accounts receivable
(36,641
)
2,598
Inventory
(153,804
)
(80,648
)
Prepaid expenses and other current assets
(16,077
)
38,187
Deposits
(39,451
)
(1,043
)
Accounts payable and accrued expenses
(56,268
)
(122,896
)
Royalty payable
51,000
(21,062
)
Accrued Interest payable
40,601
403,530
Net cash used in operating activities
(1,783,007
)
(1,399,485
)
Cash Flows from Investing Activities:
Capital Expenditures
(5,439
)
(4,526
)
Proceeds from sale of fixed assets
1,098
Investment in Salt Tequila USA, LLC
(150,000
)
—
Net cash acquired in merger
72,442
—
Net cash used in investing activities
(81,899
)
(4,526
)
Cash Flows from Financing Activities:
Proceeds from issuance of Common stock
1,610,000
375,000
Repayment of shareholder advance
(120,106
)
—
Cash advance from shareholder
288,000
—
Proceeds from issuance of debt
264,249
160,413
Principal repayment of debt
(61,248
)
—
Reduction of ROU Liability
(39,877
)
—
Net cash provided by financing activities
1,941,018
535,413
Net Change in Cash and Cash Equivalents
76,112
(868,598
)
Cash and Cash Equivalents, beginning of year
42,639
938,040
Cash and Cash Equivalents, end of period
$
118,751
$
69,442
Supplemental Disclosure of Cash Flow Information:
Cash paid for interest
$
3,424
$
—
Supplemental Disclosure of Non-Cash Investing and Financing Activities
Notes payable and accrued interest converted to common stock (12,605,283 shares)
9,248,721
—
Series A & B preferred stock and declared dividends converted to common stock
14,587,623
—
Liability issued for investment in SALT Tequila USA, LLC
100,000
—
The
accompanying notes are an integral part of these condensed consolidated financial statements.
F-
32
Splash Beverage Group, Inc.
[f/k/a Canfield Medical Supply, Inc.]
Notes
to the Condensed Consolidated Financial Statements
Note
1 – Business Organization and Nature of Operations
Splash Beverage Group ("SBG"),
f/k/a Canfield Medical Supply, Inc. (the "CMS"), was incorporated in the State of Ohio on September 3, 1992, and changed
domicile to Colorado on April 18, 2012. CMS is in the business of home health services, primarily the selling of durable medical
equipment and medical supplies to the public, nursing homes, hospitals and other end users.
On December 31, 2019, CMS entered into an
Agreement and Plan of Merger (the "Merger Agreement") with SBG Acquisition Inc. ("Merger Sub"), a Nevada
Corporation wholly-owned by CMS, and Splash Beverage Group, Inc. a Nevada corporation ("Splash") pursuant to which
Merger Sub merged with and into Splash (the "Merger") with Splash as the surviving company and a wholly-owned subsidiary
of CMS. The Merger was consummated on March 31, 2020.
As the owners and management of Splash have
voting and operating control of CMS following the Merger, the Merger transaction was accounted for as a reverse acquisition (that
is with Splash as the acquiring entity), followed by a recapitalization.
As part of the recapitalization, previously
issued shares of SBG preferred stock have been reflected as shares of common stock that were received in the Merger. These common
shares have been retrospectively presented as outstanding for all periods.
Splash specializes in the manufacturing, distribution,
and sales & marketing of various beverages across multiple channels. Splash operates in both the non-alcoholic and alcoholic
beverage segments. Additionally, Splash operates its own vertically integrated B-to-B and B-to-C e-commerce distribution platform
called Qplash, further expanding its distribution abilities and visibility.
On July 2, 2020, CMS received a Certificate
of Good Standing from the State of Colorado. This certificate allowed us to change our name from Canfield Medical Supply, Inc.
to Splash Beverage Group, Inc. a Colorado company. On July 31, 2020, we received approval from FINRA to change the Company's
name from Canfield Medical Supply, Inc. to Splash Beverage Group, Inc.
Note 2 –
Summary of Significant Accounting Policies
Basis of Presentation and Consolidation
These condensed
consolidated financial statements include the accounts of Splash Beverage Group and its wholly owned subsidiaries, Holdings and
Splash Mex, in addition to the accounts of the CMS from March 31, 2020, the merger consummation date. All intercompany balances
have been eliminated in consolidation.
Our accounting and reporting policies conform
to accounting principles generally accepted in the United States of America (GAAP).
The accompanying financial statements have
been prepared by us without audit. In the opinion of management, all adjustments (which include only normal recurring adjustments)
necessary to present fairly the financial position, results of operations and cash flows for the three months ended June 30, 2020
and 2019 have been made.
Certain information and footnote disclosures
normally included in financial statements prepared in accordance with accounting principles generally accepted in the United States
of America have been condensed or omitted. It is suggested that these financial statements be read in conjunction with the consolidated
financial statements and notes thereto included in our December 31, 2019 audited financial statements. The results of operations
for the period ended June 30, 2020 are not necessarily indicative of the operating results for the full year.
Use of Estimates
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 disclosures of contingent assets and liabilities at the date of the financial statements and the reported amounts
of revenues and expenses during the reporting period. Actual results could differ from those estimates.
Cash Equivalents and Concentration
of Cash Balance
We consider all highly liquid securities with
an original maturity of three months or less to be cash equivalents. We had no cash equivalents at June 30, 2020 or December 31,
2019.
Our cash in bank deposit accounts, at times,
may exceed federally insured limits of $250,000. At June 30, 2020 we had no bank accounts over the federally insured limits. Our
bank deposit accounts in Mexico are uninsured.
F-
33
Splash Beverage Group, Inc.
[f/k/a Canfield Medical Supply, Inc.]
Notes
to the Condensed Consolidated Financial Statements
Note
2 – Summary of Significant Accounting Policies, continued
Accounts
Receivable and Allowance for Doubtful Accounts
Accounts receivable
are carried at their estimated collectible amounts and are periodically evaluated for collectability based on past credit history
with clients and other factors. We establish provisions for losses on accounts receivable on the basis of loss experience, known
and inherent risk in the account balance, and current economic conditions.  At June 30, 2020 and December 31, 2019, our accounts
receivable amounts are reflected net of allowances of
$359,657
and $11,430, respectively.
Inventory
Inventory
is stated at the lower of cost or net realizable value, accounted for using the weighted average cost method. The inventory balances
at June 30, 2020 and December 31, 2019 consisted of finished goods held for distribution. The cost elements of inventory consist
of purchase of products, transportation, and warehousing. We establish provisions for excess or inventory near expiration are
based on management's estimates of forecast turnover of inventories on hand and under contract. A significant change in
the timing or level of demand for certain products as compared to forecast amounts may result in recording additional provisions
for excess or expired inventory in the future. Provisions for excess inventory are included in cost of goods sold and have historically
been adequate to provide for losses on inventory. We manage inventory levels and purchase commitments in an effort to maximize
utilization of inventory on hand and under commitments.
Property
and Equipment
We
record property and equipment at cost when purchased. Depreciation is recorded for property, equipment, and software using the
straight-line method over the estimated economic useful lives of assets, which range from 3-10 years. Company management reviews
the recoverability of all long-lived assets, including the related useful lives, whenever events or changes in circumstances indicate
that the carrying amount of a long-lived asset might not be recoverable.
Depreciation
expense totaled $10,750 and
$1,806 for the
three months ended June 30, 2020 and June 30, 2019, respectively. Depreciation expense totaled $13,045 and $4,711 for the six
months ended June 30, 2020 and June 30, 2019, respectively. Property and equipment as of June 30, 2020 and December 31, 2019 consisted
of the following:
June 30,
2020
December 31,
2019
Property and equipment, at cost
206,006
88,758
Accumulated depreciation
(141,738
)
(51,029
)
Property and equipment, net
64,269
37,729
Licensing
Agreements
We
capitalize the costs for our licensing agreements with ABG TapouT, LLC and Salt Tequila USA, LLC, which are amortized to expense
on a straight-line basis over the term of the agreements.
The
initial amount of the TapouT agreement as entered into by a related party prior to the Company's assumption in 2013 was
$4,000,000 to be paid over several years pursuant to a guaranteed minimum royalty agreement. Royalty costs incurred under the
agreements, guaranteed minimum royalty amounts, are expensed as incurred.
We
have not made any payments to Salt Tequila USA, LLC under the licensing agreement due to the immaterial level of our sales to
date from the brand.
F-
34
Splash Beverage Group, Inc.
[f/k/a Canfield Medical Supply, Inc.]
Notes
to the Condensed Consolidated Financial Statements
Note
2 – Summary of Significant Accounting Policies, continued
Fair
Value of Financial Instruments
Financial
Accounting Standards ("FASB") guidance specifies a hierarchy of valuation techniques based on whether the inputs to
those valuation techniques are observable or unobservable. Observable inputs reflect market data obtained from independent sources,
while unobservable inputs reflect market assumptions. The hierarchy gives the highest priority to unadjusted quoted prices in
active markets for identical assets or liabilities (Level 1 measurement) and the lowest priority to unobservable inputs (Level
3 measurement). The three levels of the fair value hierarchy are as follows:
Level
    1 -
Unadjusted
    quoted prices in active markets for identical assets or liabilities that the reporting entity has the ability to access at
    the measurement date. Level 1 primarily consists of financial instruments whose value is based on quoted market prices such
    as exchange-traded instruments and listed equities.
Level
    2 -
Inputs
    other than quoted prices included within Level 1 that are observable for the asset or liability, either directly or indirectly
    (e.g., quoted prices of similar assets or liabilities in active markets, or quoted prices for identical or similar assets
    or liabilities in markets that are not active).
Level
    3 -
Unobservable
    inputs for the asset or liability. Financial instruments are considered Level 3 when their fair values are determined using
    pricing models, discounted cash flows or similar techniques and at least one significant model assumption or input is unobservable.
The
liabilities and indebtedness presented on the consolidated financial statements approximate fair values at June 30, 2020 and December
31, 2019, consistent with recent negotiations of notes payable and due to the short duration of maturities.
Convertible
Instruments
U.S.
GAAP requires the bifurcation of certain conversion rights contained in convertible indebtedness and account for them as free
standing derivative financial instruments according to certain criteria. This criteria include circumstances in which (a) the
economic characteristics and risks of the embedded derivative instrument are not clearly and closely related to the economic characteristics
and risks of the host contract, (b) the hybrid instrument that embodies both the embedded derivative instrument and the host
contract is not re-measured at fair value under otherwise applicable generally accepted accounting principles with changes in
fair value reported in earnings as they occur and (c) a separate instrument with the same terms as the embedded derivative
instrument would be considered a derivative instrument. An exception to this rule is when the host instrument is deemed to be
conventional as that term is described under applicable U.S. GAAP.
When
bifurcation is required, the embedded conversion options are bifurcated from the convertible note, resulting in the recognition
of discounts to convertible notes for the intrinsic value of conversion options embedded in debt instruments based upon the differences
between the fair value of the underlying common stock at the commitment date of the note transaction and the effective conversion
price embedded in the note.  Debt discounts under these arrangements are amortized over the term of the related debt to their
stated date of redemption.
With
respect to convertible preferred stock, we record a dividend for the intrinsic value of conversion options embedded in preferred
securities based upon the differences between the fair value of the underlying common stock at the commitment date of the transaction
and the effective conversion price embedded in the preferred shares.
F-
35
Splash Beverage Group, Inc.
[f/k/a Canfield Medical Supply, Inc.]
Notes
to the Condensed Consolidated Financial Statements
Note
2 – Summary of Significant Accounting Policies, continued
Revenue
Recognition
We
recognize revenue under ASC 606, Revenue from Contracts with Customers (Topic 606). This guidance sets forth a five-step model
which depicts the recognition of revenue in an amount that reflects what we expect to receive in exchange for the transfer of
goods or services to customers.
We
recognize revenue when our performance obligations under the terms of a contract with the customer are satisfied. Product sales
occur once control of our products is transferred upon delivery to the customer. Revenue is measured as the amount of consideration
that we expect to receive in exchange for transferring goods and is presented net of provisions for customer returns and allowances.
The amount of consideration we receive and revenue we recognize varies with changes in customer incentives we offer to our customers
and their customers. Sales taxes and other similar taxes are excluded from revenue.
Distribution
expenses to transport our products, where applicable, and warehousing expense after manufacture are accounted for within operating
expenses.
Cost
of Goods Sold
Cost
of goods sold include the costs of products, packaging, transportation, warehousing, and costs associated with valuation allowances
for expired, damaged or impaired inventory.
Stock-Based
Compensation
We
account for stock-based compensation in accordance with ASC 718, "
Compensation - Stock Compensation"
.  Under
the fair value recognition provisions, cost is measured at the grant date based on the fair value of the award and is recognized
as expense ratably over the requisite service period, which is generally the option vesting period.  We use the Black-Scholes
option pricing model to determine the fair value of stock options.  We early adopted ASU 2018-07, "Improvements
to Nonemployee Share-Based Payment Accounting", which aligns accounting treatment for such awards to non-employees with
the existing guidance on employee share-based compensation in ASC 718.
Income
Taxes
We
use the liability method of accounting for income taxes as set forth in ASC 740, "
Income Taxes"
.  Under
the liability method, deferred taxes are determined based on the temporary differences between the financial statement and tax
basis of assets and liabilities using tax rates expected to be in effect during the years in which the basis differences reverse.  We
record a valuation allowance when it is not more likely than not that the deferred tax assets will be realized.
Company
management assesses its income tax positions and records tax benefits for all years subject to examination based upon its evaluation
of the facts, circumstances and information available at the reporting date.  In accordance with ASC 740-10, for those
tax positions where there is a greater than 50% likelihood that a tax benefit will be sustained, our policy is to record the largest
amount of tax benefit that is more likely than not to be realized upon ultimate settlement with a taxing authority that has full
knowledge of all relevant information.
For
those income tax positions where there is less than 50% likelihood that a tax benefit will be sustained, no tax benefit will be
recognized in the financial statements. Company management has determined that there are no material uncertain tax positions at
June 30, 2020 and December 31, 2019.
F-
36
Splash Beverage Group, Inc.
[f/k/a Canfield Medical Supply, Inc.]
Notes
to the Condensed Consolidated Financial Statements
Note
2 – Summary of Significant Accounting Policies, continued
Net
loss per share
The
net loss per share is computed by dividing the net loss by the weighted average number of shares of common outstanding. Warrants,
stock options, and common stock issuable upon the conversion of the Company's convertible debt or preferred stock (if any), are
not included in the computation if the effect would be anti-dilutive.
Three-months ended
Three-months ended
Six-months ended
Six-months ended
Numerator
June 30, 2020
June 30, 2019
June 30 2020
June 30, 2019
Net loss applicable to common shareholders
$
(373,350
)
$
(218,389
)
$
(3,822,129
)
$
(1,624,364
)
Denominator
Weighted average number of common shares outstanding
56,908,703
41,807,563
51,113,403
41,603,563
Net loss per share (basic and diluted)
$
(0.01
)
$
(0.01
)
$
(0.07
)
$
(0.04
)
Weighted average number of shares outstanding excludes anti-dilutive
common stock equivalents, including warrants to purchase 3 million shares of common stock for nominal consideration.
Advertising
We
conduct advertising for the promotion of our products. In accordance with ASC 720-35, advertising costs are charged to operations
when incurred.
Related
Parties
We
are indebted to certain members of our Board of Directors at June 30, 2020 and December 31, 2019. Transactions between us and
the Board members are summarized in Notes 4 and 8.
Recent
Accounting Pronouncements
In
February 2016, the FASB issued ASU 2016-02, "
Leases
" (Topic 842). This ASU requires a lessee to recognize a
right-of-use asset and a lease liability for most leases in its balance sheet.
We
adopted the standard on January 1, 2019, using the modified retrospective method. The adoption of this standard resulted in recognition
of a right-of-use asset and a lease liability, initially measured at the present value of the lease payments, for all leases with
a term greater than 12 months. When available, we would use the rate implicit in the lease to discount lease payments to present
value. However, our leases generally do not provide a readily determinable implicit rate. Therefore, our management estimates
the incremental borrowing rate to discount lease payments based on the information at the lease commencement. The accounting for
finance leases is substantially unchanged. Given the nature of our operation, the adoption of Topic 842 did not have a material
impact on our balance sheet, statement of income, or liquidity. Refer to Note 10 – Operating Lease Obligations for information
regarding our adoption of Topic 842 and the Company's undiscounted future lease payments and the timing of those payments.
Management
does not believe that any other recently issued, but not yet effective, accounting standards could have a material effect on the
accompanying financial statements. As new accounting pronouncements are issued, we will adopt those that are applicable under
the circumstances.
Note
3 – Going Concern
The accompanying
financial statements have been prepared on a going concern basis, which contemplates the realization of assets and the satisfaction
of liabilities in the normal course of business.  Our business operations have not yet generated significant revenues, and
we have sustained net losses of approximately $3.8 million during the six months ended June 30, 2020 and have an accumulated deficit
of approximately $40.5 million at June 30, 2020. In addition, we have current liabilities in excess of current assets of approximately
$2.4 million at June 30, 2020. Further, we are in default on approximately $0.6 million of indebtedness, including accrued interest.
Our
ability to continue as a going concern in the foreseeable future is dependent upon our ability to generate revenues and obtain
sufficient long-term financing to meet current and future obligations and deploy such to produce profitable operating results.
Management has evaluated these conditions and plans to raise capital as needed and to generate revenues to satisfy our capital
needs. No assurance can be given that we will be successful in these efforts.
These
factors, among others, raise substantial doubt about our ability to continue as a going concern for a reasonable period of time.
These financial statements do not include any adjustments relating to the recoverability and classification of recorded asset
amounts or the amounts and classification of liabilities that might be necessary should we be unable to continue as a going concern.
F-
37
Splash Beverage
Group, Inc.
[f/k/a Canfield
Medical Supply, Inc.]
Notes
to the Condensed Consolidated Financial Statements
Note
4 – Notes Payable, Related Party Notes Payable, Convertible Bridge Loans Payable, Revenue Financing Arrangements and Bridge
Loan Payable
Notes
payable are generally nonrecourse and secured by all Company owned assets.
Interest
    Rate
June
    30, 2020
December
    31, 2019
Notes Payable
In
    October 2013, we entered into a short-term loan agreement with an entity in the amount of $25,000. In March 2020 the full
    outstanding principal balance of $25,000 and unpaid accrued interest of $11,345 was converted into 234,767 shares of common
    stock according to the Merger Agreement.
7
%
$
—
$
25,000
In February 2014, we entered into a 12-month
    term loan agreement with an individual in the amount of $200,000. The note included warrants for 66,146 shares of common stock
    at $0.73 per share.  The warrants expired on February 28, 2017 and none were exercised at that date. The note matured
    and remains unpaid.
15
%
150,000
150,000
In March 2014, we entered into a 12-month
    term loan agreement with an individual in the amount of $500,000.  The note included warrants for 681,461 shares
    of common stock at $0.92 per share. The warrants expired on February 28, 2017 and none were exercised at that date.  In
    March 2020 the full outstanding principal balance of $500,000 and unpaid accrued interest of $373,065 was converted into 1,124,802
    shares of common stock according to the Merger Agreement.
15
%
—
500,000
In March 2014, we entered into a short-term
    loan agreement with an entity in the amount of $200,000. The note included warrants for 272,584 shares of common stock at
    $0.94 per share. The warrants expired on February 28, 2017 and none were exercised at that date. The loans matured and remain
    unpaid.
8
%
200,000
200,000
In May 2020, we entered into a two year
    loan with an entity under the Paycheck Protection Program established by the CARES Act in the amount of $94,833.32. The note
    requires monthly payments of principal and interest starting in December 2020 and maturing in May 2020. We expect $73,167
    of the loan amount to be forgiven in accordance with the CARES Act.
1
%
94,833
—
In June 2020, we entered
    into a six-month loan with an individual in the amount of $100,000. The loan matures in December 2020 with principal and interest
    due at maturity.
12
%
100,000
—
$
544,833
$
875,000
Interest
expense on notes payable was $10,429 and $28,813 for the three months ended June 30, 2020 and 2019, respectively. Interest expense
on notes payable was $59,859 and $57,626 for the six months ended June 30, 2020 and 2019, respectively. Accrued interest was $245,005
at June 30, 2020
Concurrently
with the consummation of the Merger, notes payable of $525,000 and accrued interest were converted to shares of Splash common
stock, which were exchanged for Splash Beverage Group, Inc. [Formerly known as Canfield Medical Supply, Inc.] shares. Pursuant
to the terms of the conversion agreements, these investors have the right to rescind the common shares received and receive replacement
notes payable if we fail to raise $9 million in a secondary initial public offering by September 30, 2020. As a result, these
shares are classified as mezzanine equity in our condensed consolidated balance sheet.
F-
38
Splash Beverage
Group, Inc.
[f/k/a Canfield
Medical Supply, Inc.]
Notes
to the Condensed Consolidated Financial Statements
Note
4 – Notes Payable, Related Party Notes Payable, Convertible Bridge Loans Payable, Revenue Financing Arrangements and Bridge
Loan Payable, continued
Interest
    Rate
June
    30, 2020
December
    31, 2019
Related Parties
    Notes Payable
During 2012, we entered into
    two 6-month term loan agreements with an entity, totaling $150,000. The notes included warrants for 68,146 shares of common
    stock at $0.73 per share which expired unexercised in 2017. In March 2020 the full outstanding principal balance of $41,500
    and unpaid accrued interest of $31,515 was converted into 98,726 shares of common stock according to the Merger Agreement.
7
%
$
—
$
41,500
In March 2014, we entered into a $50,000
    12-month term loan agreement. The note included warrants for 136,292 shares of common stock at $0.92 per share. The warrants
    expired unexercised on February 28, 2017.  In March 2020 the full outstanding principal balance of $50,000 and unpaid
    accrued interest of $24,145 was converted into 99,252 shares of common stock according to the Merger Agreement.
8
%
—
50,000
During 2015, we entered into a 12-month
    term loan agreement with an individual in the amount $250,000.  In March 2020 the full outstanding principal balance
    of $250,000 and unpaid accrued interest of $101,850 was converted into 98,726 shares of common stock according to the Merger
    Agreement.
8
%
—
250,000
In February 2012, we entered into a loan
    agreement with an officer of the Company in the amount of $100. On September 25, 2018 an additional $10,500 loan agreement
    was entered into. In March 2020 the full outstanding principal balance of $10,600 and unpaid accrued interest of $1,189 was
    converted into 15,734 shares of common stock according to the Merger Agreement.
7
%
—
10,600
During 2013, 2014, 2015, and 2016, we entered
    into several 12-month term loan agreements with an officer of the Company in the amounts of $57,000, $225,000, $105,000, and
    $9,000, respectively. In March 2020 the full outstanding principal balance of $396,000 and unpaid accrued interest of $146,828
    was converted into 727,344 shares of common stock according to the Merger Agreement.
7
%
—
396,000
Continued
on next page
F-
39
Splash Beverage
Group, Inc.
[f/k/a Canfield
Medical Supply, Inc.]
Notes
to the Condensed Consolidated Financial Statements
Note
4 – Notes Payable, Related Party Notes Payable, Convertible Bridge Loans Payable, Revenue Financing Arrangements and Bridge
Loan Payable, continued
Interest
    Rate
June
    30, 2020
December
    31, 2019
Related Parties
    Notes Payable, continued
During 2012, 2013, 2014, and
    2016, we entered into 6-month term loan agreements with an officer of the Company in the amounts of $155,000, $210,000, $150,000
    and $40,000, all respectively. The notes included warrants for issuances of 204,438 shares of common stock at $.092 per share.
    The warrants expired unexercised on March 1, 2017. In March 2020 the full outstanding principal balance of $495,000 and unpaid
    accrued interest of $213,010 was converted into 942,504 shares of common stock according to the Merger Agreement.
7
%
—
495,000
During 2013, 2014 and 2017, we entered into
    12-month term loan agreements with an officer of the Company in the amounts of $60,000, $50,000 and $10,000. In March 2020
    the full outstanding principal balance of $120,000 and unpaid accrued interest of $50,305 was converted into 228,328 shares
    of common stock according to the Merger Agreement.
7
%
—
120,000
During 2018, we entered into a long term
    note payable with an entity owned by an officer for $12,000 to be payable on July 10, 2020. In March 2020 the full outstanding
    principal balance of $12,000 and unpaid accrued interest of $1,050 was converted into 17,407 shares of common stock according
    to the Merger Agreement.
12
%
—
12,000
During 2019, we entered
    into a term note payable with an entity owned by an officer for $130,000 to be paid on August 8, 2019. In March 2020 the full
    outstanding principal balance of $130,000 and unpaid accrued interest of $9,078 was converted into 182,525 shares of common
    stock according to the Merger Agreement.
12
%
—
130,000
$
—
$
1,505,100
Interest
expense on related party notes payable was $0 and $24,814 for the three months ended June 30, 2020 and 2019, respectively. Interest
expense on related party notes payable was $37,967 and $49,628 for the six months ended June 30, 2020 and 2019, respectively.
Accrued interest was $0 as of June 30, 2020.
Concurrently
with the consummation of the Merger, notes payable of $1,505,100 and accrued interest were converted to shares of Splash common
stock, which were exchanged for Splash Beverage Group, Inc. [Formerly known as Canfield Medical Supply, Inc.] shares. Pursuant
to the terms of the conversion agreements, these investors have the right to rescind the common shares received and receive replacement
notes payable if we fail to raise $9 million in a secondary initial public offering by September 30, 2020. As a result, these
shares are classified as mezzanine equity in our condensed consolidated balance sheet.
F-
40
Splash Beverage
Group, Inc.
[f/k/a Canfield
Medical Supply, Inc.]
Notes
to the Condensed Consolidated Financial Statements
Note
4 – Notes Payable, Related Party Notes Payable, Convertible Bridge Loans Payable, Revenue Financing Arrangements and Bridge
Loan Payable, continued
Interest
    Rate
June
    30, 2020
December
    31, 2019
Convertible Bridge
    Loans Payable
In May 2015, we entered into
    a 3-month term loan agreement with an individual in the amount of $100,000. The annual interest rate for this bridge loan
    was 32% for the first 90 days, and 4% thereafter, compounded monthly.
See
                                         left
$
100,000
$
100,000
In October 2015, we entered into a 3-month
    term loan agreement with two individuals in the amount of $25,000. On December 26, 2018, the outstanding principal and accrued
    interest of $14,388 was consolidated into a new $39,388 term loan due August 26, 2020. In March 2020 the full outstanding
    principal balance of $39,388 and unpaid accrued interest of $5,973 was converted into 59,694 shares of common stock according
    to the Merger Agreement.
12
%
—
39,388
In June 2015, we entered into a 3-month
    term loan with two individuals in the amount of $100,000. On December 26, 2018, the outstanding principal amount of $100,000
    and accrued interest of $64,307 was consolidated into a new $164,307 term loan due August 26, 2020. In March 2020 the full
    outstanding principal balance of $164,307 and unpaid accrued interest of $24,916 was converted into 249,013 shares of common
    stock according to the Merger Agreement.
12
%
—
164,307
During 2016, 2017 and 2018, we entered into
    multiple loan agreements with an entity in varying amounts. On December 26, 2018, the outstanding principal of $235,500 and
    accrued interest of $155,861 was consolidated into a new $391,361 term due August 26, 2020. In March 2020 the full outstanding
    principal balance of $391,361 and unpaid accrued interest of $43,823 was converted into 435,184 shares of common stock according
    to the Merger Agreement.
12
%
—
391,361
During 2016, we entered into 3-month term
    loan agreements with an individual totaling $20,000. The loan was extended to August 14, 2020. In March 2020 the full outstanding
    principal balance of $20,000 and unpaid accrued interest of $10,096 was converted into 41,336 shares of common stock according
    to the Merger Agreement.
9
%
—
20,000
During 2014 through 2018, we entered into
    convertible promissory note agreements with various terms ranging from 90 days to 18 months at 18% interest with an entity
    which were consolidated into one loan at 12% in 2018 totaling $795,137 with a due date of August 26, 2020. In March 2020 the
    full outstanding principal balance of $795,137 and unpaid accrued interest of $89,037 was converted into 884,174 shares of
    common stock according to the Merger Agreement.
12
%
—
795,137
During 2015 and 2016,
    we entered into a series of 3-month term convertible promissory note agreements at 18% interest with an entity which were
    consolidated into one loan at 12% in 2018 totaling $692,471 with a due date of August 26, 2020. In March 2020 the full outstanding
    principal balance of $692,471 and unpaid accrued interest of $77,541 was converted into 770,012 shares of common stock according
    to the Merger Agreement.
12
%
—
692,471
$
100,000
$
2,202,664
During
2018, we issued convertible bridge loans payable which are convertible, at the holders' option, into shares of our common
stock.
During
2018 multiple convertible bridge loans payable to five counterparties, and related unpaid interest were consolidated into five
new convertible bridge loans payable totaling $2,082,665. The notes are of varying amounts and are due in August 2020, at an interest
rate of 12%. We analyzed the notes and concluded the conversion terms did not constitute beneficial conversion features. The principal
amount and any accrued and unpaid interest are convertible at the conversion price of a potential future offering of the Company.
F-
41
Splash Beverage
Group, Inc.
[f/k/a Canfield
Medical Supply, Inc.]
Notes
to the Condensed Consolidated Financial Statements
Note
4 – Notes Payable, Related Party Notes Payable, Convertible Bridge Loans Payable, Revenue Financing Arrangements and Bridge
Loan Payable, continued
Interest
expense on the convertible bridge loans payable was $8,000 and $70,480 for the three months ended June 30, 2020 and 2019, respectively.
Interest expense on the convertible bridge loans payable was $101,785 and $140,960 for the six months ended June 30, 2020 and
2019, respectively. Accrued interest was $155,215 at June 30, 2020.
On
April 24, 2017, a note holder filed a complaint against the Company for a promissory note in default. The note holder is requesting
summary judgment in the amount of $247,215.
Concurrently
with the consummation of the Merger, notes payable of $2,102,664 and accrued interest were converted to shares of Splash common
stock, which were exchanged for Splash Beverage Group, Inc. [Formerly known as Canfield Medical Supply, Inc.] shares. Pursuant
to the terms of the conversion agreements, these investors have the right to rescind the common shares received and receive replacement
notes payable if we fail to raise $9 million in a secondary initial public offering by September 30, 2020. As a result, these
shares are classified as mezzanine equity in our condensed consolidated balance sheet.
Interest
    Rate
June
    30, 2020
December
    31, 2019
Revenue Financing
    Arrangements
During August 2015, we entered
    into a 3-month term loan agreement with an entity in the amount of $50,000, with required daily payments of $999. we entered
    into two additional 3-month loan agreements with the entity in 2016 in the amounts of $60,000 and $57,000, with required daily
    payments of $928 and $713, respectively.   The term loans matured and remain unpaid.
10
%
28,032
28,032
During November 2016,
    we entered into a short-term loan agreement with an entity in the amount of $55,000 with required daily payments of $1,299.
    The note was in default as of December 31, 2018. In 2019, we entered into a settlement agreement with monthly installment
    payments of $6,000.  The loan is scheduled to be fully repaid in 2020.
12
%
17,435
17,435
$
45,464
$
45,464
Interest expense on the revenue financing arrangements
was $25,067 and $1,723 for the year ended June 30, 2020 and 2019, respectively. Accrued interest was $0 at June 30, 2020.
Bridge
Loan Payable
We
issued an additional bridge loan in October 2018 for $2 million with a one-year maturity to GMA Bridge Fund LLC ("GMA").
This bridge loan contains a 10% administration fee of which the full $200,000 was accrued at December 31, 2019 and included in
bridge loan payable, net. We incurred $271,670 of loan costs, which was fully amortized at December 31, 2019. Interest on the
bridge loan was 0.5% monthly for the first six months and 0.75% monthly for the next six months. At the same time the debt was
issued, we entered into a separate agreement in which GMA provided consulting services for one year ("Consulting Agreement").
We compensated GMA for the Consulting Agreement services by issuance of a warrant with a 5-year term to acquire 1,362,922 shares
of our common stock at an exercise price of $0.01 per share. The warrant vested immediately. The value of the warrant, based on
a Black-Scholes option pricing model, was $991,423 and was expensed in full in 2018. Interest expense on the bridge loan for the
six months ended June 30, 2020 was $0 and accrued interest at June 30, 2020 was $0.
As
part of GMA's conversion agreement, we replaced the original warrants to purchase 1 million shares and granted additional
warrants. To purchase 1 million shares. The value of the warrants based on a Black-Scholes option pricing model, was $1,657,805,
and was expensed.
Concurrently
with the consummation of the Merger, the $2,500,000 note payable of was converted to shares of Splash common stock, which were
exchanged for Splash Beverage Group, Inc. [Formerly known as Canfield Medical Supply, Inc.] shares. Pursuant to the terms of the
conversion agreements, GMA has the right to rescind the common shares received and receive replacement notes payable if we fail
to raise $9 million in a secondary initial public offering by September 30, 2020. As a result, these shares are classified as
mezzanine equity in our condensed consolidated balance sheet.
F-
42
Splash Beverage
Group, Inc.
[f/k/a Canfield
Medical Supply, Inc.]
Notes
to the Condensed Consolidated Financial Statements
Note
5 – Licensing Agreement and Royalty Payable
We
have a licensing agreement with ABG TapouT, LLC ("TapouT"), providing us with licensing rights to the brand "TapouT"
on energy drinks, energy shots, water, teas and sports drinks for beverages sold in the United States of America, its territories,
possessions, U.S. military bases and Mexico. Under the terms of the agreement, we are required to pay a 6% royalty on net sales,
as defined. In 2020 and 2019, we are required to make monthly payments of $45,000 and $39,000, respectively.
The
unpaid amount of royalties was $90,000 at June 30, 2020. Guaranteed minimum royalty payments totaled $135,000 and $117,000 for
the three months ended June 30, 2020 and 2019, which is included in general and administrative expenses. Guaranteed minimum royalty
payments totaled $270,000 and $234,000 for the six months ended June 30, 2020 and 2019, which is included in general and administrative
expenses.
Note 6 – Deficiency in Stockholders'
Equity
Series
A and B Convertible Preferred Stock
As
part of the merger consummated on March 31, 2020, all series A and B convertible preferred stock were converted to common stock.
If the Company is unable to achieve the capital raise event as defined in the Merger Agreement by September 30, 2020, these shareholders
can rescind their common shares back to preferred shares. Below are the new rights to these shareholders if they decide to rescind:
Series
A Convertible Preferred Stock
:
Rank.
The Series A Preferred Stock shall rank, with respect to dividend rights and to rights upon any voluntary or involuntary liquidation,
dissolution or winding up of the Company (each, a "Liquidation Event"), (a) senior in preference and priority to the
common stock of the Company (the "Common Stock") and any other class or series of equity security established and
designated by the Board of Directors the terms of which do not expressly provide that it ranks senior in preference or priority
to or on parity with the Series A Preferred Stock with respect to dividend rights and rights upon a Liquidation Event (collectively,
"Junior Securities"), (b) on parity, without preference or priority, with each other class or series of equity security
established and designated by the Board of Directors the terms of which expressly provide that it ranks on parity, without preference
or priority to, the Series A Preferred Stock with respect to dividend rights and rights upon a Liquidation Event (collectively,
"Parity Securities"), and (c) junior in preference and priority to each other class or series of equity security established
and designated by the Board of Directors the terms of which expressly provide that it ranks senior in preference or priority to
the Series A Preferred Stock with respect to dividend rights and rights upon a Liquidation Event (collectively, "Senior
Securities").
Dividends.
Holders of shares of the Series A Preferred Stock are entitled to receive, when, as and if declared by the Board, out of funds
legally available for the payment of dividends, cumulative cash dividends at an annual rate of eight percent (8%) of the Original
Issue Price per share (equal to $.08 per share per annum). Dividends shall accrue on each share of Series A Preferred Stock from
the date of issuance thereof, whether paid or not, and shall be cumulative and compounded annually.
Liquidation
Preference. In the event of any Liquidation Event, the holders of shares of Series A Preferred Stock then outstanding shall be
entitled to be paid out of the assets of the Company available for distribution to its stockholders before any payment shall be
made to the holders of any Junior Securities by reason of their ownership thereof, an amount per share equal to one hundred fifty
percent (150%) of the Series A Original Issue Price (the "Liquidation Preference"), plus the amount of accrued and
unpaid dividends thereon from the Original Issue Date through the date of liquidation. If upon any such Liquidation Event the
assets of the Company available for distribution to its stockholders shall be insufficient to pay the holders of shares of Series
A Preferred Stock the full amount to which they shall be entitled under this, the holders of shares of Series A Preferred Stock
and Parity Securities shall share ratably in any distribution of the assets available for distribution in proportion to the respective
amounts which would otherwise be payable in respect of the shares held by them upon such distribution if all amounts payable on
or with respect to such shares were paid in full.
Conversion.
The holders of Series A Preferred Stock shall have conversion rights as follows (the "Conversion Rights"):
Optional
Conversion. Each share of Series A Preferred Stock shall be convertible, at the option of the holder thereof, at any time and
from time to time, into such number of fully paid and non-assessable shares of Common Stock as is determined by dividing the Series
A Original Issue Price by the Conversion Price (as defined below) in effect at the time of conversion. The Conversion Price at
which shares of Common Stock shall be deliverable upon conversion of Series A Preferred Stock without the payment of additional
consideration by the holder thereof (the "Conversion Price") shall initially be $1.28 per share. Such initial Conversion
Price, and the rate at which shares of Series A Preferred Stock may be converted into shares of Common Stock, shall be subject
to adjustment as provided below. All accrued and unpaid dividends may be converted by each holder of Series A Preferred Stock
into Common Stock by first determining the number of shares of Series A Preferred Stock that could be purchased based on the Series
A Original Issue Price then in effect and then determining the number of shares of Common Stock such additional shares of Series
A Preferred Stock are convertible into. By way of illustration only, if the accrued and unpaid dividends are equal to $100,000,
then based on the Series A Original Issue Price of $1.00 and a Conversion Price of $0.85, the holders of Series A Preferred Stock
would receive an additional 85,000 shares of Common Stock.
Automatic
Conversion. Upon the consummation of an underwritten public offering of the Common Stock of the Company ("IPO") ,
each share of Series A Preferred Stock shall automatically be converted into such number of fully paid and non-assessable shares
of Common Stock at a Conversion Price equal to the lesser of (i) the Conversion Price in effect immediately prior to the consummation
of the IPO or (ii) fifty percent (50%) of the public offering price of the Common Stock in the IPO. All accrued and unpaid dividends
may be converted by each holder of Series A Preferred Stock into Common Stock by first determining the number of shares of Series
A Preferred Stock that could be purchased based on the Series A Original Issue Price then in effect and then determining the number
of shares of Common Stock such additional shares of Series A Preferred Stock are convertible into. By way of illustration only,
if the accrued and unpaid dividends are equal to $100,000, then based on the Series A Original Issue Price of $1.00 and a Conversion
Price of $0.85, the holders of Series A Preferred Stock would receive an additional 85,000 shares of Common Stock.
F-
43
Note 6 – Deficiency in Stockholders'
Equity, continued
Series
B Convertible Preferred Stock
:
Rank.
The Series B Preferred Stock shall rank, with respect to dividend rights and to rights upon any voluntary or involuntary liquidation,
dissolution or winding up of the Company (each, a "Liquidation Event"), (a) senior in preference and priority to the
common stock of the Company (the "Common Stock") and any other class or series of equity security established and
designated by the Board of Directors the terms of which do not expressly provide that it ranks senior in preference or priority
to or on parity with the Series B Preferred Stock with respect to dividend rights and rights upon a Liquidation Event (collectively,
"Junior Securities"), (b) on parity, without preference or priority, with the Series A Preferred Stock and with each
other class or series of equity security established and designated by the Board of Directors the terms of which expressly provide
that it ranks on parity, without preference or priority to, the Series B Preferred Stock with respect to dividend rights and rights
upon a Liquidation Event (collectively, "Parity Securities"), and (c) junior in preference and priority to each other
class or series of equity security established and designated by the Board of Directors the terms of which expressly provide that
it ranks senior in preference or priority to the Series B Preferred Stock with respect to dividend rights and rights upon a Liquidation
Event (collectively, "Senior Securities").
Dividends.
The holders of the Series B Preferred Stock shall be entitled to receive cash dividends, when, as and if declared by the Board,
out of any assets legally available therefor, prior and in preference to any declaration or payment of any dividend on any other
class of Preferred Stock, except for the Series A Preferred Stock which shall be paid at the same time as the Series B Preferred
Stock is paid, and Common Stock of the Corporation at an annual rate of nine percent (9%) of the Original Issue Price per share
(equal to $.09 per share per annum) payable out of legally available funds. Dividends shall accrue on each share of Series B Preferred
Stock from the date of issuance thereof, whether paid or not, and shall be cumulative and compounded annually. Such dividends
shall be payable on the first day of each January, April, July and October commencing with respect to each share of Series B Preferred
Stock, on the first of such dates to occur after the issuance of such share (each such date a "Dividend Payment Date")
to the holders of record at the close of business on the fifteenth day of each December, March, June and September, respectively,
subject to declaration of such dividends by the Board. All dividends paid with respect to shares of Series B Preferred Stock shall
be paid pro rata to the holders entitled thereto. Dividends, if paid, must be paid, on all outstanding shares of Series B Preferred
Stock contemporaneously. If any dividend shall not be paid on a Dividend Payment Date, for any reason, the right of the holders
to receive such dividend shall not lapse or terminate but each such dividend shall accrue and be paid to such holders, subject
to the conversion provisions below. No dividend shall be paid to the holders of any shares of Common Stock until all dividends,
including accrued dividends, then owing to the holders of Series B Preferred Stock, shall have been paid in full.
Liquidation
Preference. In the event of any Liquidation Event, the holders of shares of Series B Preferred Stock then outstanding shall be
entitled to be paid out of the assets of the Company available for distribution to its stockholders before any payment shall be
made to the holders of any Junior Securities by reason of their ownership thereof, an amount per share equal to one hundred fifty
percent (150%) of the Series B Original Issue Price (the "Liquidation Preference"), plus the amount of accrued and
unpaid dividends thereon from the Original Issue Date through the date of liquidation. If upon any such Liquidation Event the
assets of the Company available for distribution to its stockholders shall be insufficient to pay the holders of shares of Series
B Preferred Stock the full amount to which they shall be entitled under this Section , the holders of shares of Series B Preferred
Stock and Parity Securities shall share ratably in any distribution of the assets available for distribution in proportion to
the respective amounts which would otherwise be payable in respect of the shares held by them upon such distribution if all amounts
payable on or with respect to such shares were paid in full.
Conversion.
The holders of Series B Preferred Stock shall have conversion rights as follows (the "Conversion Rights"):
Optional
Conversion. Each share of Series B Preferred Stock shall be convertible, at the option of the holder thereof, at any time and
from time to time, into such number of fully paid and non-assessable shares of Common Stock as is determined by dividing the Series
B Original Issue Price by the Conversion Price (as defined below) in effect at the time of conversion. The Conversion Price at
which shares of Common Stock shall be deliverable upon conversion of Series B Preferred Stock without the payment of additional
consideration by the holder thereof (the "Conversion Price") shall initially be $1.28 per share. Such initial Conversion
Price, and the rate at which shares of Series B Preferred Stock may be converted into shares of Common Stock, shall be subject
to adjustment as provided below. All accrued and unpaid dividends may be converted by each holder of Series B Preferred Stock
into Common Stock by first determining the number of shares of Series B Preferred Stock that could be purchased based on the Series
B Original Issue Price then in effect and then determining the number of shares of Common Stock such additional shares of Series
B Preferred Stock are convertible into. By way of illustration only, if the accrued and unpaid dividends are equal to $100,000,
then based on the Series B Original Issue Price of $1.50 and a Conversion Price of $1.28, the holders of Series B Preferred Stock
would receive an additional 78,125 shares of Common Stock.
Automatic
Conversion. Upon the consummation of an underwritten public offering of the Common Stock of the Company ("IPO"), each
share of Series B Preferred Stock shall automatically be converted into such number of fully paid and non-assessable shares of
Common Stock at a Conversion Price equal to the lesser of (i) the Conversion Price in effect immediately prior to the consummation
of the IPO or (ii) fifty percent (50%) of the public offering price of the Common Stock in the IPO. All accrued and unpaid dividends
may be converted by each holder of Series B Preferred Stock into Common Stock by first determining the number of shares of Series
B Preferred Stock that could be purchased based on the Series B Original Issue Price then in effect and then determining the number
of shares of Common Stock such additional shares of Series B Preferred Stock are convertible into. By way of illustration only,
if the accrued and unpaid dividends are equal to $100,000, then based on the Series B Original Issue Price of $1.50 and a Conversion
Price of $1.28, the holders of Series B Preferred Stock would receive an additional 78,125 shares of Common Stock.
Common
Stock
In
2019, we issued 1,846,078 shares of our common stock in exchange for services provided to us. The shares were valued at $0.73
per share. We recognized share-based compensation expense of $1,354,500, which is classified within the contracted services line
on the Statement of Operations. At June 30, 2020, we issued 249,912 shares of common stock in exchange for cash. The shares were
valued at $0.73 per share.
Treasury
Stock
Since
its inception, we have repurchased shares from our shareholders. To date, we have repurchased 1,226,630 shares, of which 817,753
have been retired.
In
connection with a 2018 consulting agreement, we were committed to issue the 408,877 shares held in treasury upon the occurrence
of certain events or milestones. We issued 136,292 shares in July 2018, 136,292 shares in July 2019 and 136,292 shares on March
31, 2020.
Warrant
Issuance-Common Stock
As
part of the sale and issuance of 4,088,765 shares of our Series A Convertible Preferred Stock, we issued 4,088,765 warrants to
purchase shares of our common stock at a price of $0.73 per share. The warrants had a five-year term and expired during 2019.
As
an incentive to convert their Series A preferred stock we issued 1,000,000 new warrants to purchase shares of SBG common stock
at $0.18 per share. Concurrently with the consummation of the Merger, these warrants were exchanged for 1,362,922 of Splash Beverage
Group, Inc. [Formerly known as Canfield Medical Supply, Inc.] shares. These warrants have a 3-year term.
Warrant
Issuance-Common Stock
As
part of the sale and issuance of 5,333,675 shares of our Series B Convertible Preferred Stock, we issued 2,666,839 warrants to
purchase shares our common stock at a price of $1.10 per share. The warrants have a 5-year term. At June 30, 2020, there are 1,145,786  
warrants outstanding with a weighted average remaining life of 0.3 years.
As
part of the sale of 100,000 shares of common stock, we issued 325,000 warrants to purchase shares of our common stock at a price
of $0.25 per share. These warrants have a 3-year term.
F-
44
Splash Beverage
Group, Inc.
[f/k/a Canfield
Medical Supply, Inc.]
Notes
to the Condensed Consolidated Financial Statements
Note
7 – Share-Based Payments
Warrant
Issuance-GMA Consulting Services
We
issued 1,362,922 warrants to purchase shares of our common stock at $0.007 per share as part of our consulting agreement with
GMA, at December 31, 2019, the weighted average life of the outstanding warrants is 3.75 years.
The
warrants entitle the holder to purchase one share per warrant of the Company's common stock at a price of $0.01 per
share during the five-year period commencing on October 2, 2018, or, if greater, the number of common shares with a market value
equivalent to two percent of the enterprise value of the Company at an exercise price of $0.008 per share.
As
an incentive for GMA to convert their debt and accrued interest into shares of common stock, we retired the original 1,362,922
warrants and issued 2,725,844 pre-merger new warrants to purchase shares of our common stock at $0.18 per share. These warrants
have a 3-year term.
Stock
Plan
We
have adopted the 2012 Stock Incentive Plan for SBG (the "Plan"), which provides for the grant of common stock and
stock options to employees. We have reserved 4,088,765 shares for issuance under the Plan. The option exercise price generally
may not be less than the underlying stock's fair market value at the date of the grant and generally have a term of ten
years. On December 31, 2018, the sole option holder at the time, our CEO, exercised his options to purchase 2,657,698 shares of
common stock at a purchase price of $0.12 per share, totaling $312,000, which total purchase price was paid by the cancelation
of the equivalent amount of debt owed by us to the CEO. On December 7, 2019, our Board of Directors granted 1,124,410 options
to certain employees and consultants. None of these options were exercised at June 30, 2020. There are 1,124,410 options issued
and outstanding under the Plan at June 30, 2020. As of June 30, 2020, the total number of options available for grant is 306,657.
We
measure employee stock-based awards at the grant-date fair value and recognizes employee compensation expense on a straight-line
basis over the vesting period of the award. Determining the appropriate fair value of stock-based awards requires the input of
subjective assumptions, including the fair value of our common stock, and for stock options, the expected life of the option,
and expected stock price volatility and exercise price. We used the Black-Scholes option pricing model to value its stock option
awards. The assumptions used in calculating the fair value of stock- based awards represent management's best estimates
and involve inherent uncertainties and the application of management's judgment. As a result, if factors change and management
uses different assumptions, stock-based compensation expense could be materially different for future awards. The expected life
of stock options was estimated using the "simplified method," which calculates the expected term as the midpoint between
the weighted average time to vesting and the contractual maturity, we have limited historical information to develop reasonable
expectations about future exercise patterns and employment duration for its stock options grants. The simplified method is based
on the average of the vesting tranches and the contractual life of each grant. For stock price volatility, we use comparable public
companies as a basis for its expected volatility to calculate the fair value of options granted. The risk-free interest rate is
based on U.S. Treasury notes with a term approximating the expected life of the option. The estimation of the number of stock
awards that will ultimately vest requires judgment, and to the extent actual results or updated estimates differ from the Company's
current estimates, such amounts are recognized as an adjustment in the period in which estimates are revised.
We
recognized stock-based compensation expense of $265,589 for the year ended December 31, 2019. There was no unrecognized compensation
cost related to stock option awards at June 30, 2020.
Concurrently with the consummation of the
Merger, options to purchase 825,000 SBC shares were converted to options to purchase 1,124,410 Splash Beverage Group, Inc. [Formerly
Canfield Medical Supply, Inc.] shares.
Options
Weighted
    Average Exercise Price
Outstanding - beginning of year
1,124,410
$
0.77
Granted
—
Exercised
—
$
—
Cancelled/forfeited
—
$
—
Outstanding - June 30, 2020
1,124,410
$
0.77
Exercisable at June, 30 2020
1,124,410
$
0.77
Weighted average grant date fair value of
    options during year
N/A
Weighted average duration to expiration of outstanding options at June 30, 2020
4.8
F-
45
Splash Beverage
Group, Inc.
[f/k/a Canfield
Medical Supply, Inc.]
Notes
to the Condensed Consolidated Financial Statements
Note
8 – Related Parties
During the normal
course of business, we incurred expenses related to services provided by our CEO or Company expenses paid by our CEO, resulting
in related party payables, net of $517,875 as of June 30, 2020. The related party payable to the CEO bears no interest payable
and is due on demand. We also assumed a $50,000 note for the President of WesBev who is the majority shareholder of Splash Beverage
Group, Inc. [Formerly known as Canfield Medical Supply, Inc.].
There
are related party notes payable of $0 outstanding as of June 30, 2020 as discussed in Note 4.
Note
9 – Investment in Salt Tequila USA, LLC
On
December 9, 2013, we entered into a marketing and distribution agreement with SALT Tequila USA, LLC ("SALT") in Mexico
for the manufacturing of our product line. The agreement was for a one-year term with an additional two-year renewal. On December
28, 2015, the agreement was extended through 2020. In the December 9, 2013 agreement, we received a 5% ownership interest in SALT,
12 months after the date of the agreement we received an additional 5% ownership interest in SALT, and 24 months after the date
of the agreement we received an additional 5% interest, resulting in a total interest of 15% in SALT. We have not recorded the
cost of the investment or our share of its results of operations as the amounts are considered immaterial.
SALT
also has sold product to an unrelated international alcohol distributor, American Spirits Exchange, for preliminary market testing
in 9 of 16 states that they distribute to, that are government-controlled alcohol resellers. In 2019 we had no sales for SALT
Tequila. On December 31, 2018, we created a Mexican subsidiary, Splash MEX SA DE CV ("Splash Mex") for the exporting
of SALT Tequila from Mexico to the USA, South and Central Americas. Splash Mex will also act as the manufacturing and distribution
agent of TapouT in Central and South Americas. Applications for the appropriate licenses required for import and wholesale of
alcohol in the USA have been completed for at the Federal and State levels. These licenses will permit direct alcohol sales to
distributors and wholesalers thereby limiting the use of agents for importing SALT Tequila to the USA for distribution.
On
March 26, 2020, we entered into a new amended stock sale and purchase agreement. The agreement is for $1,000,000 to be paid in
4 tranches of $250,000 and entitles us to additional equity interest in Salt Tequila USA, LLC as follows:
●
Tranche 1 –
    7.5%
●
Tranche 2 –
    5.0%
●
Tranche 3 –
    5.0%
●
Tranche 4 –
    5.0%
Once
all tranches are paid-out we will have a total equity stake of 37.5% of Salt Tequila USA, LLC.
F-
46
Splash Beverage
Group, Inc.
[f/k/a Canfield
Medical Supply, Inc.]
Notes
to the Condensed Consolidated Financial Statements
Note
10 – Operating Lease Obligations
Effective
July 2018, we entered into a lease agreement for the right to use and occupy office space. The lease term commenced July 1, 2018
and is scheduled to expire after 36 months, on June 30, 2021.
Prior
to the current lease, we entered into a lease agreement in 2014 for the right to use and occupy office space. The lease term commenced
November 1, 2014 and was scheduled to expire after 62 months, on March 31, 2020. The lease was terminated in February 2018.
Effective
November 2019, we entered into a new lease agreement for our NY affiliate. The lease is for six months and will expire on April
30, 2020. This lease was not subjected to the new lease standard, Topic 842.
Effective
November 2019, we entered into a new lease with Interport Logistics, LLC. The lease term commenced on November 11, 2019 and is
scheduled to expire on November 11, 2020.
Effective
May 2019, we entered into a new lease in Mexico. The lease commenced May 1, 2019 and is scheduled to expire after 24 months, on
April 1, 2021.
The
following table presents the discounted present value of minimum lease payments for our office and warehouses to the amounts reported
as financial lease liabilities on the condensed consolidated balance sheet at June 30, 2020:
Undiscounted Future Minimum Lease Payments
Operating Lease
2020
$
47,456
2021
59,291
Thereafter
29,086
Total
135,832
Amount representing imputed interest
(5,732)
Total operating lease liability
130,101
Current portion of operating lease liability
89,950
Operating lease liability, non-current
$
40,151
The table below presents information for lease
costs related to our operating leases at June 30, 2020:
Operating lease cost:
Amortization of leased assets
$
87,798
Interest of lease liabilities
9,180
Total operating lease cost
$
96,978
The table below presents lease-related terms
and discount rates at June 30, 2020:
Remaining term on leases
10 to 28 months
Incremented borrowing rate
5.0
%
F-
47
Splash Beverage
Group, Inc.
[f/k/a Canfield
Medical Supply, Inc.]
Notes
to the Condensed Consolidated Financial Statements
Note
11 – Line of Credit
At
June 30, 2020 SBG owed $68,000 to a financial institution under a revolving line of credit which is classified within other current
liabilities. The line of credit is secured by the assets of SBG is due on demand, and bears interest at variable rates approximately
6.1% at June 30, 2020. Interest expense under the note was approximately $900 during the three months ended June 30, 2020. Interest
expense under the note was approximately $2,000 during the six months ended June 30, 2020.
Note
12 – PPP Loan
On
January 30, 2020, the World Health Organization ("WHO") announced a global health emergency because of a new strain
of coronavirus originating in Wuhan, China (the "COVID-19 outbreak") and the risks to the international community
as the virus spreads globally beyond the point of origin. On March 20, 2020, the WHO classified the COVID-19 outbreak as a pandemic,
based on the rapid increase in exposure globally.
In
response to the COVID-19 outbreak in the United States, the CARES Act (the "Act") was passed by Congress
and signed into law on March 27, 2020. In connection with the CARES Act, the Company and its subsidiary applied for and
received  loans with an original aggregate principal balance of approximately $158,000. These loans and interest will be
forgiven as long as the funds are used for qualifying expenditures as outlined in the Act. The loans bear interest at 1%,
with an 18 month term, and has a 6-month initial payment deferral.
Note
13 – Business Combinations
As
stated in Note 1, we consummated the merger of SBG on March 31, 2020 which was accounted for as a reverse merger.
The
value of our merger was approximately $9.2 million based on the valuation of the SBG equity on the date of consummation.
The
following summarizes our allocation of the purchase price for the acquisition:
Cash and cash equivalents
$
72,442
Accounts receivable
$
311,586
Inventory
$
21,415
Property and equipment
$
38,110
Goodwill
$
9,448,832
Accounts payable,
    accrued expenses and other liabilities
$
719,221
Purchase price
$
9,173,164
Note
14 – Segment Reporting
The
Company evaluates segment reporting in accordance with the FASB Accounting Standards Codification Topic 280, Segment Reporting,
each reporting period, including evaluating the reporting package reviewed by the Chief Executive Officer and Chief Financial
Officer.
Three-Months Ending
Six-Months Ending
Revenue
Q2 2020
Q2 2019
Q2 2020
Q2 2019
Beverages
412,729
42,775
524,732
48,105
Medical Devices
199,579
—
199,579
—
Total Revenues
612,308
42,775
724,311
48,105
Total assets
June 2020
December 2019
Beverages
1,172,224
605,314
Medical Devices
9,763,660
—
Total Assets
10,935,884
605,314
Note
15 – Commitment and Contingencies
We
are a party to asserted claims and are subject to regulatory actions in the ordinary course of business. The results of such proceedings
cannot be predicted with certainty, but we do not anticipate that the outcome, if any, arising out of any such matter will have
a material adverse effect on its business, financial condition or results of operations.
Capital
Raise
In
connection with the merger we are committed to our previous preferred stock and debt holders to raise $9 million in a secondary
IPO, as defined in the agreements.
Stock
Price Guarantee
We
have a commitment to issue additional shares associated with specific stock price guarantee granted to an investor. See Note 4.
Note
16 – Subsequent Events
Private Placement Memorandum (PPM)
Our Board of Directors
has determined that it is in the best interests of the Corporation and its stockholders to obtain working capital by conducting
a private placement offering of 2,727,272 shares of the common stock of the Company, no par value per share at a purchase price
of $1.10 per share for aggregate gross proceeds of $3,000,000. As part of the PPM, each common share holds one-half warrant. As
of August 14, 2020 the company has not sold any shares.
Company Name Change
In July 2020, we filed a Certificate of Amendment
of Articles of Incorporation to change our name to Splash Beverage Group Inc. On July 31, 2020, we received approval from FINRA
regarding our name change.
New
Stock Issuance
On
July 1, 2020, we enter a subscription agreement with one of our existing shareholders for $110,000 in exchange for
100,000 of our common stock at $1.10 per share. As part of the agreement we granted 325,000 warrants at a purchase price of $0.25
per warrant.
On
July 8, 2020, we enter a subscription agreement with one of our existing shareholders for $500,000 in exchange for 454,546
of our common stock at $1.10 per share. As part of the agreement we granted 554,546 warrants.
F-
48
UNAUDITED
PRO FORMA CONSOLIDATED FINANCIAL STATEMENTS
The
following unaudited pro forma consolidated financial statement gives effect to the Merger Agreement transaction (the "Merger
Agreement") between Canfield Medical Supply, Inc. ("CMS") and Splash Beverage Group, Inc. ("SBG").
In the Merger Agreement, CMS issued 54,677,690 shares of its common stock to the shareholders of SBG in exchange for all of the
issued and outstanding common shares of SBG, which resulted in SBG becoming a wholly-owned subsidiary of CMS. CMS also issued
warrants to acquire 6,024,174 shares of its common stock to existing SBG warrant holders. As owners and management of SBG have
voting and operating control of CMS following the Merger Agreement, the transaction is accounted for as a reverse acquisition.
The
unaudited pro forma consolidated financial statements presented below are prepared by applying the acquisition method of accounting
to a business combination that is a reverse acquisition. Pro forma adjustments which give effect to certain transactions occurring
as a direct result of the Merger Agreement are described in the accompanying unaudited notes presented on the following page.
The accompanying unaudited pro forma consolidated statement of operations for the year ended December 31, 2019 presents the combined
results of operations as if the Reverse Acquisition had occurred on January 1, 2019 in addition to, the consolidated statement
of operations for the six-months ending June 30, 2020.
These
unaudited pro forma consolidated financial statements are presented for illustrative purposes only and are not necessarily indicative
of the consolidated financial position or results of operations in future periods or the results that actually would have been
realized had CMS and SBG been a combined company during the specified periods. The unaudited pro forma consolidated financial
statements, including the notes thereto, are qualified in their entirety by reference to, and should be read in conjunction with,
SBG's audited financial statements at and for the years ended December 31, 2019 and 2018, SBG's Q2 2020 Form 10-Q and CMS's
audited financial statements for the years ended December 31, 2019 and 2018, as included in herein for the year ended December
31, 2019.
F-
49
Splash
Beverage Group, Inc.
2019 Proforma Condensed Statement of Operations
(UNAUDITED)
Pro Forma
Pro Forma
Condensed
Splash
Canfield
Adjustments
Consolidated
Revenues
20,387
1,017,833
—
1,038,220
Cost of Sales
(245,500
)
(508,874
)
—
(754,374
)
Gross Margin
(225,113
)
508,959
—
283,846
Operating
    Expenses
4,261,946
979,355
—
5,241,301
Loss from Operations
(4,487,059
)
(470,396
)
—
(4,957,455
)
Interest Expense
(665,195
)
(8,376
)
(a)
584,830
(88,741
)
Other Income (Expense)
16,523
1,538
18,061
Net
    Loss
(5,135,731
)
(477,234
)
584,830
(5,028,135
)
Net
    loss per share
(0.12
)
Pro forma weighted
average
    shares outstanding
42,154,947
(a)
To
reverse interest expense on notes payable which were converted to Common stock concurrently with the Merger Agreement
F-
50
Splash
Beverage Group, Inc.
June
30, 2020 Proforma Condensed Statement of Operations
(UNAUDITED)
Pro Forma
Pro Forma
Condensed
Splash
Canfield
Adjustments
Consolidated
Revenues
724,311
(a)
175,273
—
899,584
Cost of Sales
(394,987
)
(a)
(105,964
)
—
(500,951
)
Gross Margin
329,324
69,309
—
398,633
Operating
    Expenses
2,267,280
(a)
178,811
—
2,446,091
Loss from Operations
(1,937,956
)
(109,502
)
—
(2,047,458
)
Interest Expense
(1,935,491
)
(a)
(2,513
)
(b)
145,579
(1,792,425
)
Other Income (Expense)
51,318
(a)
454
51,772
Net
    Loss
(3,822,129
)
(111,561
)
145,579
(3,788,111
)
Net
    loss per share
(0.08
)
Pro forma weighted
average
    shares outstanding
50,428,177
(a)
- to include the pre-acquisition results of operations of Canfield Medical Supply, Inc.
(b)
To reverse interest expense on notes payable which were converted to Common stock concurrently
with the Merger Agreement
F-
51
ITEM 4. DESCRIPTION OF SECURITIES.
Not applicable.
ITEM 5. INTERESTS OF NAMED EXPERTS AND COUNSEL.
Certain legal matters in
connection with this registration statement will be passed upon for the Registrant by Sichenzia Ross Ference LLP of New York, New
York. Sichenzia Ross Ference LLP or certain members or employees of Sichenzia Ross Ference LLP have been issued common stock of
the Company
4
ITEM 6. INDEMNIFICATION OF DIRECTORS AND
OFFICERS.
Our certificate of incorporation
provides that all our directors, officers, employees and agents shall be entitled to be indemnified by us to the fullest extent
permitted under the Colorado law against all liability and expense (including, but not limited to, attorneys' fees) incurred by
reason of the fact that he is or was a director or officer of the Corporation.
Our
Bylaws provide for indemnification of our directors to the fullest extent not prohibited under the Colorado law.
Our
Bylaws provide that we may indemnify and advance expenses to officers, employees, fiduciaries and agents of the Company as we
deem appropriate and as permitted by Colorado law.  No such indemnification shall be made without the prior approval of our
Board of Directors and the determination by the Board of Directors that such indemnification is permissible, except pursuant to
a contract approved by the Board of Directors.
ITEM 7. EXEMPTION FROM REGISTRATION CLAIMED.
Not applicable.
ITEM 8. EXHIBITS.
EXHIBIT
NUMBER
EXHIBIT
4.1
SPLASH BEVERAGE GROUP, INC. 2020 Long-Term Incentive Compensation Plan
5.1
Opinion of Sichenzia Ross Ference LLP
23.1
Consent of Sichenzia Ross Ference LLP (included in Exhibit 5.1)
23.2
Consent of Daszkal Bolton LLP, Independent Registered Public Accounting Firm
.
23.3
Consent of Grant Thornton LLP, Independent Registered Public Accounting Firm
23.4
Consent of Pinnacle Accountancy Group of Utah
24.1
Power of Attorney (included on signature page)
5
ITEM 9. UNDERTAKINGS.
1. The Company
hereby undertakes:
(a)
To file, during any period in which offers or sales are being made, a post-effective amendment to this Registration Statement:
(i) To include any prospectus
required by Section 10(a)(3) of the Securities Act;
(ii) To reflect in the
prospectus any facts or events arising after the effective date of this Registration Statement (or the most recent post-effective
amendment thereof) which, individually or in the aggregate, represent a fundamental change in the information set forth in the
registration statement. Notwithstanding the foregoing, any increase or decrease in volume of securities offered (if the total dollar
value of securities offered would not exceed that which was registered) and any deviation from the low or high end of the estimated
maximum offering range may be reflected in the form of prospectus filed with the Commission pursuant to Rule 424(b) if, in the
aggregate, the changes in volume and price represent no more than a 20 percent change in the maximum aggregate offering price set
forth in the "Calculation of Registration Fee" table in the effective registration statement; and
(iii) To include any material
information with respect to the plan of distribution not previously disclosed in this Registration Statement or any material change
to such information in this Registration Statement;
provided, however, that
paragraphs (1)(a)(i) and (1)(a)(ii) do not apply if the information required to be included in a post-effective amendment
by those paragraphs is contained in periodic reports filed by the Registrant pursuant to Section 13 or Section 15(d)
of the Exchange Act that are incorporated by reference in this Registration Statement;
(b)
That, for the purpose of determining any liability under the Securities Act, each such post-effective amendment shall be deemed
to be a new registration statement relating to the securities offered therein, and the offering of such securities at that time
shall be deemed to be the initial bona fide offering thereof; and
(c)
To remove from registration by means of a post-effective amendment any of the securities being registered which remain unsold at
the termination of the offering.
(d)
That, for the purpose of determining liability of the Company under the Securities Act to any purchaser in the initial distribution
of the securities: The Company undertakes that in a primary offering of securities of the Company pursuant to this Registration
Statement, regardless of the underwriting method used to sell the securities to the purchaser, if the securities are offered or
sold to such purchaser by means of any of the following communications, the Company will be a seller to the purchaser and will
be considered to offer or sell such securities to such purchaser: (i) any preliminary prospectus or prospectus of the Company
relating to the offering required to be filed pursuant to Rule 424; (ii) any free writing prospectus relating to the offering
prepared by or on behalf of the Company or used or referred to by the Company; (iii) the portion of any other free writing
prospectus relating to the offering containing material information about the Company or its securities provided by or on behalf
of the Company; and (iv) any other communication that is an offer in the offering made by the Company to the purchaser.
2. The Company
hereby undertakes that, for purposes of determining any liability under the Securities Act, each filing of the Company's
annual report pursuant to Section 13(a) or Section 15(d) of the Exchange Act that is incorporated by reference in the
Registration Statement shall be deemed to be a new registration statement relating to the securities offered therein, and the offering
of such securities at that time shall be deemed to be the initial bona fide offering thereof.
3. Insofar
as indemnification for liabilities arising under the Securities Act may be permitted to directors, officers and controlling persons
of the Company pursuant to the foregoing provisions, or otherwise, the Company has been advised that in the opinion of the Commission
such indemnification is against public policy as expressed in the Securities Act and is, therefore, unenforceable. In the event
that a claim for indemnification against such liabilities (other than the payment by the Company of expenses incurred or paid by
a director, officer or controlling person of the Company in the successful defense of any action, suit or proceeding) is asserted
by such director, officer or controlling person in connection with the securities being registered, the Company will, unless in
the opinion of its counsel the matter has been settled by controlling precedent, submit to a court of appropriate jurisdiction
the question whether such indemnification by it is against public policy as expressed in the Securities Act and will be governed
by the final adjudication of such issue.
6
SIGNATURES
Pursuant to the requirements of the Securities
Act of 1933, as amended, the registrant certifies that it has reasonable grounds to believe that it meets all of the requirements
for filing on Form S-8 and has duly caused this Form S-8 to be signed on its behalf by the undersigned, thereunto duly authorized,
in the City of Fort Lauderdale, State of Florida on  August 18, 2020.
By:
/s/
Robert Nistico
Robert Nistico
Chief Executive Officer
POWER OF ATTORNEY
KNOW ALL MEN BY THESE
PRESENTS, that each person whose signature appears below constitutes and appoints Robert Nistico , his true and lawful attorney-in-fact
and agent with full power of substitution and re-substitution, for him/her and in his name, place and stead, in any and all capacities
to sign any or all amendments (including, without limitation, post-effective amendments) to this Registration Statement, any related
Registration Statement filed pursuant to Rule 462(b) under the Securities Act of 1933, as amended, and any or all pre- or post-effective
amendments thereto, and to file the same, with all exhibits thereto, and all other documents in connection therewith, with the
Securities and Exchange Commission, granting unto said attorney-in-fact and agent, full power and authority to do and perform each
and every act and thing requisite and necessary to be done in and about the premises, as fully for all intents and purposes as
he or she might or could do in person, hereby ratifying and confirming that said attorney-in-fact and agent, or any substitute
or substitutes for him, may lawfully do or cause to be done by virtue hereof.
Pursuant to the requirements of the Securities
Act of 1933, as amended, this Registration Statement has been signed below by the following persons in the capacities and on the
dates indicated.
Date: August 18, 2020
/s/
Robert Nistico
Robert Nistico
Chief Executive Officer
Date:August 18, 2020
/s/
Dean
    Huge
Dean Huge
Chief
        Financial Officer
7