$30,946,993 on March 31, 2020. 18 Part II Item 5. 20 Item 7A. Quantitative and Qualitative Disclosures About Market Risk. Changes in and Disagreements With Accountants on Accounting and Financial Disclosure. We only use cannabinoid extracts from hemp grown in the United States in our products. We believe we compete based upon the quality of our products. These issues may take years to resolve. In addition, many of our office personnel are working remotely. xA0; The quality of our products is essential to our business strategy. xA0; ITEM 3. LEGAL PROCEEDINGS. We settled the case and collected all past amounts due on October 16, 2020. xA0; Not applicable to our company. At this time, we have not had any impact on our supply chain. We use the implicit rate when readily determinable. We operate from our offices located in Charlotte, North Carolina. Fees and reserves can change periodically with notice from the processors. Expenditures for routine maintenance and repairs are charged to operations as incurred. Fair value is a market-based measurement, not an entity-specific measurement. Goodwill is not subject to amortization but must be evaluated for impairment annually. At September 30, 2020, the Company has no future performance obligations. In addition, common area maintenance rent is set at $25,200 annually. The warrants were valued at $178,513 and expire on October 10, 2024. The options have a term of ten years. The pre-vesting forfeiture rate of zero is based upon the experience of the Company. The warrants expire on January 14, 2025. The restricted stock awards vested June 30, 2020. As the stock has not been issued this is recorded as an other accounts receivable. The Company periodically evaluates the recoverability of the deferred tax assets. xA0; NOTE 18 – LEASES On October 1, 2019, the Company adopted ASU No. Our leases do not contain any residual value guarantees. Under the terms of Amendment No. OD\\5!V7^TT:[email protected]&,@UYN#GIQBJUR6 M! ! end GRAPHIC 11 ycbd004.jpg IMAGE begin 644 ycbd004.jpg M_]C_X 02D9)[email protected] ! MIX70=(QTY!_2KCW4(\\-+:,,SBY\\P,. T%!I(8H\'%% Z45+)/C69DMFVKEY#@\'\'(\'IFNN\\ ")? We operate
from our offices located in Charlotte, North Carolina. We have only awarded stock options since
December 2015. All
of our leases are classified as operating leases.