Sugarmade, Inc.

On December 11, 2013, the Company was served with a complaint from two convertible note holders and investors in the Company. On February 21, 2017, the Company signed a settlement agreement with the plaintiffs in the matter of Hannan vs. Sugarmade. Under the terms of the settlement agreement, the company agreed to pay the plaintiffs an aggregate of $227,000 to settle all claims against the Company, which included the payoff of two notes outstanding. The parties had estimated the value of the notes at approximately $80,000. As of June 30, 2020, third parties had purchased two (2) notes of approximately $80,000. As of March 31, 2021, there remains a balance, plus accrued interest on the $227,000 and on the $80,000 due under the notes.

Lemon Glow is the owner of a 640-acre property located in Lake Country, California. Lemon Glow is in the process of improving 32 acres of the 640 acres for use as a regulated cannabis cultivation site. The Company and Lemon Glow expect that the annual potential cultivation yield at the property is approximately 4,000 pounds per acre of dry trimmed cannabis flower, although there can be no assurance that the property will yield this amount or any at all.

At the Effective Time, all the property, rights, privileges, powers and franchises of Lemon Glow and Merger Sub vested in Lemon Glow as the surviving corporation, and all debts, liabilities, obligations, restrictions, disabilities and duties of Lemon Glow and Merger Sub became those of Lemon Glow as the surviving corporation. In addition, at the Effective Time, the Articles of Incorporation and Bylaws of Lemon Glow remained in place as the Articles of Incorporation and Bylaws of Lemon Glow as the surviving corporation.

At the Closing, each outstanding share of common stock of Lemon Glow, of which there were 11,000 shares at the effective time of the Merger, were converted into the right to receive the Merger Consideration. Also at the Closing, each outstanding share of common stock of Merger Sub (100 shares) was converted into one share of common stock of Lemon Glow which became the only outstanding capital stock of the Lemon Glow at the effective time of the Merger. In addition, each share of Lemon Glow common stock of the Company held in the treasury of Lemon Glow immediately prior to the Closing was canceled and retired. As a result, the Company became the sole owner of 100% of the issued and outstanding common stock of Lemon Glow.

On December 11, 2013, the Company was served with a complaint from two convertible note holders and investors in the Company. On February 21, 2017, the Company signed a settlement agreement with the plaintiffs in the matter of Hannan vs. Sugarmade. Under the terms of the settlement agreement, the Company agreed to pay the plaintiffs an aggregate of $227,000 to settle all claims against the Company, which included the payoff of two notes outstanding. The parties estimated the value of the notes at approximately $80,000. As of June 30, 2020, third parties had purchased two notes of approximately $80,000. As of March 31, 2021, there remains a balance, plus accrued interest on the $227,000 and on the $80,000 due under the notes.

During the nine months ended March 31, 2021, the Company issued the following shares: