Uplift Nutrition, Inc.

The Company has adopted ASC 820, “Fair Value Measurement,” accounting guidance for fair value measurements of financial assets and liabilities. The adoption did not have a material impact on the Company’s results of operations, financial position or liquidity. This standard defines fair value, provides guidance for measuring fair value and requires certain disclosures. This standard does not require any new fair value measurements but rather applies to all other accounting pronouncements that require or permit fair value measurements. This guidance does not apply to measurements related to share-based payments. This guidance discusses valuation techniques, such as the market approach (comparable market prices), the income approach (present value of future income or cash flow), and the cost approach (cost to replace the service capacity of an asset or replacement cost). The guidance utilizes a fair value hierarchy that prioritizes the inputs to valuation techniques used to measure fair value into three broad levels. The following is a brief description of those three levels:

On September 9, 2016, the Company issued a 12% OID convertible note payable to a fifth investor, in connection with the July 1 Offering, to a third party in the amount of $28,409. The note is convertible at a conversion price of $0.02, subject to the favored nations clause mentioned above. An aggregate total of $19,318 of this note was bifurcated with the embedded conversion option recorded as a derivative liability at fair value (See Note 8). As of September 30, 2016, the Company recorded accrued interest of $163 and the entire balance of $28,409 is outstanding.

The Company applies the provisions of ASC Topic 815-40, Contracts in Entity’s Own Equity (“ASC Topic 815-40”), under which convertible instruments that contain terms that protect holders from declines in the stock price (reset provisions), may not be exempt from derivative accounting treatment. As a result, embedded conversion options in convertible debt are recorded as a liability and are revalued at fair value at each reporting date. If the fair value exceeds the face value of the related debt, the excess is recorded as interest expense on the issuance date. The Company has $142,046 of convertible debt, which are treated as a derivative instruments outstanding at September 30, 2016.

The Company calculates the estimated fair values of the liabilities for derivative instruments using the Binomial Trees model. The closing price of the Company’s common stock at September 30, 2016 was $0.02. Volatility, expected remaining term and risk free interest rates used to estimate the fair value of derivative liabilities at September 30, 2016, are indicated in the table that follows. The volatility was based on historical volatility at September 30, 2016, the expected term is equal to the remaining term of the convertible debt and the risk free rate is based upon rates for treasury securities with the same term.

The Company is seeking to acquire a new business either through acquisition or merger. Currently, the Company is in discussions with the principals of Oncova Clinical Research, Inc., a Florida corporation engaged in the clinical research industry (“Oncova”). Although we have no firm agreements or understandings with Oncova, the Company is pursuing discussions to acquire Oncova via a potential merger. To assist these discussions, the Company has loaned Oncova $62,500 in exchange for a promissory note, dated March 17, 2017, secured by a stock pledge of 251 shares of Oncova stock held by its principals and their personal guarantees. The loan bears interest at an annual rate equal to the applicable Federal Rate which will be adjusted and compounded on a semi-annual basis. The maturity date of this promissory note is September 17, 2017, and repayment is scheduled for such date unless, prior to such date, the Company and Oncova enter into and close a definitive acquisition agreement, in which case the outstanding balance and accrued interest shall be applied towards the Company’s purchase or acquisition price for Oncova.