10-Q - BLPG - Equibles

UNITED

STATES

SECURITIES

AND EXCHANGE COMMISSION

Washington,

D.C. 20549

FORM

10-Q

☒

QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended September 30, 2021

☐

TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For

the transition period from __________________ to _________________

Commission

file number: 000-52942

BLUE

LINE PROTECTION GROUP, INC.

(Exactname of registrant as specified in its charter)

Nevada	20-5543728
(State<br> or other jurisdiction of<br><br> <br>incorporation<br> or organization)	(IRS<br> Employer<br><br> <br>Identification<br> No.)
5765 Logan St.<br><br> <br>Denver, CO	80216
(Address<br> of principal executive offices)	(Zip<br> Code)

(800)844-5576

(Registrant’s telephone number, including area code)

N/A

(Former name, former address and former fiscal year, if changed since last report)

Securities registered pursuant to Section 12(b) of the Act:

Title of each class	Trading Symbol(s)	Name of each exchange on which registered
None	N/A	N/A

Indicate by check mark whether the registrant: (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☒ No ☐

Indicate by a checkmark whether the registrant has submitted electronically every Interactive Date File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§ 232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files). Yes ☒ No ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company or an emerging growth company. See definitions of “large accelerated filer,” “accelerated filer”, “smaller reporting company” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

Large accelerated<br> filer	☐	Accelerated<br> 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 13(a) of the Exchange Act.

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No ☒

As

of October 28, 2021, the registrant had 8,485,144 outstanding shares of common stock.

FORWARD-LOOKING

STATEMENTS

The information in this report contains forward-looking statements and information within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended, (“the Exchange Act”), which are subject to the “safe harbor” created by those sections. The words “anticipates,” “believes,” “estimates,” “expects,” “intends,” “may,” “plans,” “projects,” “will,” “should,” “could,” “predicts,” “potential,” “continue,” “would” and similar expressions are intended to identify forward-looking statements, although not all forward-looking statements contain these identifying words. We may not actually achieve the plans, intentions or expectations disclosed in our forward-looking statements and you should not place undue reliance on our forward-looking statements. Actual results or events could differ materially from the plans, intentions and expectations disclosed in the forward-looking statements that we make. The forward-looking statements are applicable only as of the date on which they are made, and we do not assume any obligation to update any forward-looking statements. All forward-looking statements in this Form 10-Q are made based on our current expectations, forecasts, estimates and assumptions, and involve risks, uncertainties and other factors that could cause results or events to differ materially from those expressed in the forward-looking statements. In evaluating these statements, you should specifically consider various factors, uncertainties and risks that could affect our future results or operations. These factors, uncertainties and risks may cause our actual results to differ materially from any forward-looking statement set forth in this Form 10-Q. You should carefully consider these risk and uncertainties described and other information contained in the reports we file with or furnish to the SEC before making any investment decision with respect to our securities. All forward-looking statements attributable to us or persons acting on our behalf are expressly qualified in their entirety by this cautionary statement.

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TABLE

OF CONTENTS

		Page No.
	PART I. FINANCIAL INFORMATION
ITEM 1.	FINANCIAL STATEMENTS.
	Consolidated Balance Sheets – As of September 30, 2021 (unaudited) and December 31, 2020	F-1
	Consolidated Statements of Operations – Three and Nine months ended September 30, 2021 and 2020 (unaudited)	F-2
	Consolidated<br> Statements of Cash Flows – Nine months ended September 30, 2021 and 2020 (unaudited)	F-3
	Consolidated Statements of Stockholders’ Deficit – Nine months ended September 30, 2021 and 2020 (unaudited)	F-4
	Notes to Financial Statements (Unaudited)	F-5
ITEM 2.	MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS.	4
ITEM 4.	CONTROLS AND PROCEDURES.	7
	PART II. OTHER INFORMATION
ITEM 6.	EXHIBITS.	7

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BLUE

LINE PROTECTION GROUP, INC.

CONSOLIDATED

BALANCE SHEETS

			December 31, 2020
	(unaudited)			(audited)
Assets
Current assets:
Cash and equivalents	453,483		$	244,750
Accounts receivable	359,389			322,598
Prepaid expenses and deposits	31,997			32,216
Total current assets	844,869			599,564
Fixed assets:
Right to use assets	557,738			636,968
Machinery and equipment, net et, net of accumulated depreciation of 549,648 and 451,760, respectively	321,256			296,410
Security Deposit	28,958			32,158
Fixed assets of discontinued operations	2,782			2,782
Total fixed assets	910,734			968,318
Total assets	1,755,603			1,567,882
Liabilities and Stockholders’ Deficit
Current liabilities:
Accounts payable and accrued liabilities	1,217,651		$	1,160,962
Financed lease liabilities	26,218			65,985
Notes payable	50,000			85,000
Notes payable - related parties	614,272			696,272
Convertible notes payable, net of unamortized discount	-			169,218
Convertible notes payable - related parties, net of unamortized discount	1,805,217			1,830,217
Current portion of operating lease obligation	120,547			107,242
Derivative liabilities	1,943,709			2,247,645
Total current liabilities	5,777,614			6,362,541
Long-term liabilities:
Financed lease liabilities - long term	31,624			1,820
Operating lease liability-long term	473,759			565,632
Total current liabilities	505,383			567,452
Total liabilities	6,282,997			6,929,993
Stockholders’ deficit:
Preferred Stock, 0.001 par value, 100,000,000 shares authorized, 20,000,000 shares issued and outstanding as of September 30, 2021 and December 31, 2019, respectively	20,000			20,000
Common Stock, 0.001 par value, 14,000,000 shares authorized, 8,485,144 and 8,223,574 issued and outstanding as of September 30, 2021 and December 31, 2020, respectively	8,484			8,224
Common Stock, owed but not issued, 129 shares and 129 shares as of September 30, 2021 and December 31, 2020, respectively	13			13
Additional paid-in capital	8,444,504			8,031,471
Accumulated deficit	(13,000,395	)		(13,421,819	)
Total stockholders’ deficit	(4,527,394	)		(5,362,111	)
Total liabilities and stockholders’ deficit	1,755,603		$	1,567,882

All values are in US Dollars.

The

accompanying notes are an integral part of these consolidated financial statements.

| F-1 |

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BLUE

LINE PROTECTION GROUP, INC.

CONSOLIDATED

STATEMENTS OF OPERATIONS

(UNAUDITED)

	For the three months ended						For the nine months ended
	September 30,						September 30,
	2021			2020			2021			2020
Revenue	$	1,161,430		$	1,087,997		$	3,580,432		$	3,087,004
Cost of revenue		(316,940	)		(286,120	)		(958,650	)		(908,918	)
Gross profit		844,490			801,877			2,621,782			2,178,086
Operating expenses:
General and administrative expenses		510,744			524,671			1,583,273			1,613,748
Total expenses		510,744			524,671			1,583,273			1,613,748
Operating Income		333,746			277,206			1,038,509			564,338
Other income (expenses):
Gain on settlement of accounts payable		-			-			-			4,500
Interest expense		(92,009	)		(110,722	)		(517,738	)		(326,386	)
Income / (Loss) on derivative		(683,432	)		(135,389	)		(99,347	)		(400,159	)
Total other expenses		(775,441	)		(246,111	)		(617,085	)		(722,045	)
Net Income / (loss)	$	(441,695	)	$	31,095		$	421,424		$	(157,707	)
Net Income / (loss) per common share: Basic	$	(0.05	)	$	0.00		$	0.05		$	(0.02	)
Net Income / (loss) per common share: Diluted	$	(0.05	)	$	0.00		$	0.03		$	(0.02	)
Weighted average number of
common shares outstanding- Basic		8,485,145			7,957,548			8,446,995			7,941,624
Weighted average number of common shares outstanding-<br> Basic		8,485,145			7,957,548			8,446,995			7,941,624
common shares outstanding- Diluted		8,485,145			47,461,137			12,296,538			7,941,624
Weighted average number of common shares outstanding-<br> Diluted		8,485,145			47,461,137			12,296,538			7,941,624

The

accompanying notes are an integral part of these consolidated financial statements.

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BLUE

LINE PROTECTION GROUP, INC.

CONSOLIDATED

STATEMENTS OF CASH FLOWS

(UNAUDITED)

	For the nine months ended
	September 30,
	2021			2020
Operating activities
Net income (loss)	$	421,424		$	(157,707	)
Adjustments to reconcile net loss to net cash used in operating activities:
Depreciation		97,889			92,899
Amortization of discounts on notes payable		-			8,710
Amortization of right to use		79,230			85,451
Loan fees		-			10,665
Gain on settlement of accounts payable		-			(4,500	)
Noncash operating lease expense		-			-
Change in fair value of derivative liabilities		99,347			400,159
Changes in operating assets and liabilities:
(Increase) in accounts receivable		(36,791	)		(4,160	)
(Increase) / decrease in deposits and prepaid expenses		3,419			-
Increase (decrease) in accounts payable and accrued liabilities		57,189			32,711
Increase (decrease) in lease obligations		(78,568	)		(82,076	)
Net cash provided by operating activities		643,139			382,152
Cash flows from investing activities
Purchase of fixed assets		(66,000	)		(24,970	)
Net cash provided by/(used in) investing activities		(66,000	)		(24,970	)
Financing activities
Proceeds from notes payable		-			24,000
Repayments on convertible notes payable - related party		(122,000	)		-
Repayments on convertible notes payable		(159,708	)		-
Repayments from notes payable - related party		(20,000	)		(90,239	)
Payments on notes payable		(66,698	)		(27,798	)
Net cash used in financing activities		(368,406	)		(94,037	)
Net increase in cash		208,733			263,145
Cash - beginning		244,750			45,113
Cash - ending	$	453,483		$	308,258
Supplemental disclosures of cash flow information:
Interest paid	$	400,256		$	-
Income taxes paid	$	-		$	-
Non-cash investing and financing activities:
Capitalized leased fixed assets	$	56,735		$	-
Common stock issued for conversion of debt and interest	$	10,010		$	3,480
Derivative resolution	$	403,283		$	14,327
Accounts payable converted to notes payable - related party	$	-		$	62,000

The

accompanying notes are an integral part of these consolidated financial statements.

| F-3 |

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BLUE

LINE PROTECTION GROUP, INC.

CONSOLIDATED

STATEMENTS OF STOCKHOLDERS’ DEFICIT

FOR

THE NINE MONTHS ENDED SEPTEMBER 30, 2021 AND 2020

(UNAUDITED)

									Additional
	Preferred Stock				Common Stock				Paid-in		Stock		Accumulated			Stockholders’
	Shares		Amount		Shares		Amount		Capital		Payable		Deficit			Deficit
Balance, December 31, 2019		20,000,000	$	20,000		7,933,574	$	7,934	$	8,013,954	$	13	$	(12,487,242	)	$	(4,445,341	)
Common stock issued for conversion of debt and fees
Common stock issued for conversion of debt and fees, shares
Common stock issued for conversion of debt and accrued interest		-		-		290,000		290		3,190		-		-			3,480
Rounding from reverse stock split
Rounding from reverse stock split, shares
Derivative resolution		-		-		-		-		14,327		-		-			14,327
Net loss		-		-		-		-		-		-		(157,707	)		(157,707	)
Balance, September 30, 2020		20,000,000	$	20,000		8,223,574	$	8,224	$	8,031,471	$	13	$	(12,644,949	)	$	(4,585,241	)
Balance, December 31, 2020		20,000,000	$	20,000		8,223,574	$	8,224	$	8,031,471	$	13	$	(13,421,819	)	$	(5,362,111	)
Common stock issued for conversion of debt and fees		-		-		260,000		260		9,750		-		-			10,010
Rounding shares issued from reverse stock split		-		-		1,570		-		-		-		-			-
Derivative resolution		-		-		-		-		403,283		-		-			403,283
Net income		-		-		-		-		-		-		421,424			421,424
Net income (loss)		-		-		-		-		-		-		421,424			421,424
Balance, September 30, 2021		20,000,000	$	20,000		8,485,144	$	8,484	$	8,444,504	$	13	$	(13,000,395	)	$	(4,527,394	)

The

accompanying notes are an integral part of these consolidated financial statements.

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Blue

Line Protection Group, Inc.

Notes

to Consolidated Financial Statements

Note1 – History and organization of the company

The

Company was originally organized on September 11, 2006 (Date of Inception) under the laws of the State of Nevada, as The Engraving Masters, Inc. The Company was authorized to issue up to 100,000,000 shares of its common stock and 100,000,000 shares of preferred stock, each with a par value of $0.001 per share.

On March 14, 2014, the Company acquired Blue Line Protection Group, Inc., a Colorado corporation formed in February 2014 (“Blue Line Colorado”), as a wholly-owned subsidiary of the Company. Blue Line Colorado provides protection, compliance, and financial services to the lawful cannabis industry.

On May 2, 2014, the Company changed its name from The Engraving Masters, Inc. to Blue Line Protection Group, Inc. (“BLPG”)

On May 6, 2014, the Company effected a forward stock split and a pro-rata increase in its authorized common stock on a basis of 14-to-1, whereby each shareholder received 14 newly issued shares of common stock for each 1 share held. Additionally, the authorized capital of the Company concurrently increased to 1,400,000,000 shares of common stock. All references to share and per share amounts in the consolidated financial statements and accompanying notes thereto have been retroactively restated to reflect the forward stock split.

On July 6, 2021, the Company effected a reverse stock split and a pro-rata decrease in its authorized common stock on a basis of 1-for-100, the authorized capital of the Company concurrently decreased to 14,000,000 shares of common stock. All references to share and per share amounts in the consolidated financial statements and accompanying notes thereto have been retroactively restated to reflect the forward stock split.

The Company provides logistics, and compliance services for businesses engaged in the legal cannabis industry. The Company offers asset logistic services, such as armored transportation service; including shipment protection, money escorts, asset vaulting, financial services, such as handling transportation and storage of currency; training; and compliance services.

Note2 – Accounting policies and procedures

Interimfinancial statements

The unaudited interim consolidated financial statements included herein, presented in accordance with United States generally accepted accounting principles and stated in US dollars, have been prepared by the Company, without audit, pursuant to the rules and regulations of the Securities and Exchange Commission (SEC). Certain information and footnote disclosures normally included in financial statements prepared in accordance with generally accepted accounting principles have been condensed or omitted pursuant to such rules and regulations, although the Company believes that the disclosures are adequate to make the information presented not misleading.

In the opinion of management, these statements reflect all adjustments, all of which are of a normal recurring nature, which, in the opinion of management, are necessary for fair presentation of the information contained therein. It is suggested that these interim financial statements be read in conjunction with the financial statements of the Company for the year ended December 31, 2020 and notes thereto included in the Company’s annual report on Form 10-K. The Company follows the same accounting policies in the preparation of interim reports.

Results of operations for the interim periods are not indicative of annual results.

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Principlesof consolidation

For the three and nine months ended September 30, 2021 and 2020, the consolidated financial statements include the accounts of Blue Line Protection Group, Inc. (formerly The Engraving Masters, Inc.), Blue Line Advisory Services, Inc. (a Nevada corporation; “BLAS”), Blue Line Capital, Inc. (a Colorado corporation; “Blue Line Capital”), Blue Line Protection Group (California), Inc. (a California corporation; “Blue Line California”), Blue Line Colorado, Blue Line Protection Group Illinois, Inc. (an Illinois corporation; “Blue Line Illinois”), BLPG, Inc. (a Nevada corporation; “Blue Line Nevada”), Blue Line Protection Group (Washington), Inc. (a Washington corporation; “Blue Line Washington”). All significant intercompany balances and transactions have been eliminated. BLPG and its subsidiaries are collectively referred herein to as the “Company.”

Basisof presentation

The financial statements present the balance sheets, statements of operations, stockholder’s equity (deficit) and cash flows of the Company. The financial statements of the Company have been prepared in accordance with generally accepted accounting principles in the United States of America.

The Company has adopted December 31 as its fiscal year end.

Useof estimates

The preparation of financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenue and expenses during the reporting period. Actual results could differ from those estimates.

Cashand cash equivalents

The Company maintains a cash balance in a non-interest-bearing account that currently does not exceed federally insured limits. For the purpose of the statements of cash flows, all highly liquid investments with an original maturity of three months or less are considered to be cash equivalents. There were no cash equivalents as of September 30, 2021 and December 31, 2020.

Accountsreceivable

Accounts receivable are stated at the amount the Company expects to collect from outstanding balances and do not bear interest. The Company provides for probable uncollectible amounts through an allowance for doubtful accounts, if an allowance is deemed necessary. The allowance for doubtful accounts is the Company’s best estimate of the amount of probable credit losses in the Company’s existing accounts receivable; however, changes in circumstances relating to accounts receivable may result in a requirement for additional allowances in the future. On a periodic basis, management evaluates its accounts receivable and determines the requirement for an allowance for doubtful accounts based on its assessment of the current and collectible status of individual accounts with past due balances over 90 days. Account balances are charged against the allowance after all collection efforts have been exhausted and the potential for recovery is considered remote.

Allowancefor uncollectible accounts

The Company estimates losses on receivables based on known troubled accounts, if any, and historical experience of losses incurred. There was no allowance for doubtful customer receivables at September 30, 2021 and December 31, 2020.

| F-6 |

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Propertyand equipment

Property and equipment is recorded at cost and capitalized from the initial date of service. Expenditures for major additions and improvements are capitalized and minor replacements, maintenance, and repairs are charged to expense as incurred. When property and equipment is retired or otherwise disposed of, the cost and accumulated depreciation are removed from the accounts and any resulting gain or loss is included in the results of operations for the respective period. Depreciation is provided over the estimated useful lives of the related assets using the straight-line method for financial statement purposes. The Company uses other depreciation methods (generally accelerated) for tax purposes where appropriate. The estimated useful lives for significant property and equipment categories are as follows:

Schedule of Estimated Useful Lives of Property and Equipment

Automotive Vehicles	5 years
Furniture and Equipment	7 years
Buildings and Improvements	15 years

The

Company reviews the carrying value of property and equipment for impairment whenever events and circumstances indicate that the carrying value of an asset may not be recoverable from the estimated future cash flows expected to result from its use and eventual disposition. In cases where undiscounted expected future cash flows are less than the carrying value, an impairment loss is recognized equal to an amount by which the carrying value exceeds the fair value of assets. The factors considered by management in performing this assessment include current operating results, trends and prospects, the manner in which the property is used, and the effects of obsolescence, demand, competition and other economic factors. Based on this assessment there was no impairment as September 30, 2021 and December 31, 2020. Depreciation expense for the three and nine months ended September 30, 2021 and September 30, 2020 were $37,828, $97,889, $32,359 and $92,899 respectively.

Impairmentof long-lived assets

The Company accounts for its long-lived assets in accordance with ASC Topic 360-10-05, “Accounting for the Impairment or Disposal of Long-Lived Assets.” ASC Topic 360-10-05 requires that long-lived assets be reviewed for impairment whenever events or changes in circumstances indicate that the historical cost or carrying value of an asset may no longer be appropriate. The Company assesses recoverability of the carrying value of an asset by estimating the future net cash flows expected to result from the asset, including eventual disposition. If the future net cash flows are less than the carrying value of the asset, an impairment loss is recorded equal to the difference between the asset’s carrying value and its fair value or disposable value. As of September 30, 2021 and December 31, 2020, the Company determined that none of its long-lived assets were impaired.

Concentrationof business and credit risk

The Company has no significant off-balance sheet risks such as foreign exchange contracts, option contracts or other hedging arrangements. The Company’s financial instruments that are exposed to concentration of credit risks consist primarily of cash. The Company maintains its cash in bank accounts, which may at times, exceed federally insured limits.

The

Company had one major customer which generated 21%, of total revenue in the nine months ended September 30, 2021.

The

Company had two major customers which generated 31%, (17% and 14%) of total revenue in the nine months ended September 30, 2020.

Relatedparty transactions

FASB ASC 850, “Related Party Disclosures” requires companies to include in their financial statements disclosures of material related party transactions. The Company discloses all material related party transactions. Related parties are defined to include any principal owner, director or executive officer of the Company and any immediate family members of a principal owner, director or executive officer.

Fairvalue of financial instruments

The carrying amounts reflected in the balance sheets for cash, accounts payable and related party payables approximate the respective fair values due to the short maturities of these items. The Company does not hold any investments that are available-for-sale.

| F-7 |

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As required by the Fair Value Measurements and Disclosures Topic of the FASB ASC, fair value is measured based on a three-tier fair value hierarchy, which prioritizes the inputs used in measuring fair value as follows: (Level 1) observable inputs such as quoted prices in active markets; (Level 2) inputs, other than the quoted prices in active markets, that are observable either directly or indirectly; and (Level 3) unobservable inputs in which there is little or no market data, which require the reporting entity to develop its own assumptions.

The three levels of the fair value hierarchy are described below:

Level<br> 1:	Unadjusted<br> quoted prices in active markets that are accessible at the measurement date for identical, unrestricted assets or liabilities;
Level<br> 2:	Quoted<br> prices in markets that are not active, or inputs that are observable, either directly or indirectly, for substantially the full term<br> of the asset or liability;
Level<br> 3:	Prices<br> or valuation techniques that require inputs that are both significant to the fair value measurement and unobservable (supported by<br> little or no market activity).

The following table presents the derivative financial instruments, the Company’s only financial liabilities, measured and recorded at fair value on the Company’s consolidated balance sheet on a recurring basis, and their level within the fair value hierarchy as of September 30, 2021 and December 31, 2020:

September 30, 2021

Schedule of Fair Value of Liabilities Measured on Recurring Basis

	Amount		Level 1		Level 2		Level 3
Embedded conversion derivative liability	$	1,943,709	$	-	$	-	$	1,943,709
Warrant derivative liabilities	$	-	$	-	$	-	$	-
Total	$	1,943,709	$	-	$	-	$	1,943,709

December 31, 2020

	Amount		Level 1		Level 2		Level 3
Embedded conversion derivative liability	$	2,246,080	$	-	$	-	$	2,246,080
Warrant derivative liabilities	$	1,565	$	-	$	-	$	1,565
Total	$	2,247,645	$	-	$	-	$	2,247,645

The embedded conversion feature in the convertible debt instruments that the Company issued that became convertible qualified them as derivative instruments since the number of shares issuable under the notes are indeterminate based on guidance in FASB ASC 815, Derivatives and Hedging. These convertible notes tainted all other equity linked instruments including outstanding warrants and fixed rate convertible debt on the date that the instrument became convertible. The valuation of the derivative liability of the warrants was determined through the use of Black Scholes option-pricing model (See Note 8).

RevenueRecognition

The Company recognizes revenue when delivery of the promised goods or services is transferred to its customers in an amount that reflects the consideration that the Company expects to be entitled to in exchange for those goods or services. We determine revenue recognition through the following five steps:

●	Identify<br> the contract with the customer;
●	Identify<br> the performance obligations in the contract;
●	Determine<br> the transaction price;
●	Allocate<br> the transaction price to the performance obligations in the contract; and
●	Recognize<br> revenue when, or as, the performance obligations are satisfied.

| F-8 |

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We generate substantially all our revenue from providing services to customers. The Company records revenue when the 5 steps above have been completed.

Effective January 1, 2018, the Company adopted ASU 2014-09, Revenue from Contracts with Customers (Topic 606), which supersedes the revenue recognition requirements in Topic 605, Revenue Recognition, and most industry-specific revenue recognition guidance throughout the Industry Topics of the Accounting Standards Codification. The updated guidance states that an entity should recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. The guidance also provides for additional disclosures with respect to revenues and cash flows arising from contracts with customers. The Company adopted the standard using the modified retrospective approach effective January 1, 2018. The adoption of these standards did not have an impact on the Company’s Statements of Operations for the year ended December 31, 2018.

In general, the Company’s business segmentation is aligned according to the nature and economic characteristics. Revenue is characterized by several lines of services and typically the pricing is fixed.

Schedule of Revenue by Major Customers by Reporting Segments

Three months ended September 30,
Revenue Breakdown by Streams	2021		2020
Service: Transportation	$	452,155	$	430,357
Service: Currency Processing		690,512		624,373
Service: Compliance		18,763		33,261
Total	$	1,161,430	$	1,087,997
Nine months ended September 30,
---	---	---	---	---
Revenue Breakdown by Streams	2021		2020
Service: Transportation	$	1,381,231	$	1,381,449
Service: Currency Processing		2,162,424		1,657,344
Service: Compliance		36,777		48,211
Total	$	3,580,432	$	3,087,004

Gainon settlement of accounts payable

Represents

a $4,500 gain on settlement of payables with vendors.

Advertisingcosts

The Company expenses all costs of advertising as incurred.

Generaland administrative expenses

The significant components of general and administrative expenses consist mainly of rent and compensation.

Share-BasedCompensation

Share-based compensation expense is recorded as a result of stock options granted in return for services rendered. Previously, the share-based payment arrangements with employees were accounted for under ASC 718, while nonemployee share-based payments issued for goods and services are accounted for under ASC 505-50. ASC 505-50 differs significantly from ASC 718. On June 20, 2018, the FASB issued ASU 2018-07, which simplifies the accounting for share-based payments granted to nonemployees for goods and services. Under the ASU, most of the guidance on such payments to nonemployees would be aligned with the requirements for share-based payments granted to employees. The Company has adopted the new standard and has made some adjustment with regard to the share-based compensation costs. Under the ASU 2018-07, the measurement of equity-classified nonemployee share-based payments is generally fixed on the grant date and the options are no longer revalued on each reporting date. The expenses related to the share-based compensation are recognized on each reporting date. The amount is calculated as the difference between total expenses incurred and the total expenses already recognized.

| F-9 |

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Costof Revenue

The Company’s cost of revenue primarily consists of labor, fuel costs and items purchased by the Company specifically for the benefit of the Company’s clients.

Net loss per share is provided in accordance with FASB ASC 260-10, “Earnings per Share”. Basic loss per share is computed by dividing losses available to common stockholders by the weighted average number of common shares outstanding during the period. Diluted income (loss) per share gives effect to all dilutive potential common shares outstanding during the period. Dilutive loss per share excludes all potential common shares if their effect is anti-dilutive. For the periods presented all common stock equivalents were excluded from the calculation of diluted loss per share as their effect would be anti-dilutive.

The following is a reconciliation of the numerator and denominator used in the basic and diluted earnings per share (“EPS”) calculations for the three and nine months September 30, 2021 and 2020.

Basicand Diluted Earnings per share

The following is a reconciliation of the numerator and denominator used in the basic and diluted earnings per share (“EPS”) calculations for the three and nine months September 30, 2021 and 2020.

Schedule of Basic and Diluted Earnings Per Share (“EPS”)

	Three months ended <br> September 30, 2021			Three months ended <br> September 30, 2020		Six Months ended <br> June 30, 2021		Nine Months ended <br> September 30, 2020
Numerator:
Net income (loss)	$	(441,695	)	$	31,095	$	421,424	$	(157,707	)
Denominator:
Weighted-average shares of common stock		8,485,145			7,957,548		8,446,995		7,941,624
Dilutive effect of warrants		-			100,000		-		-
Dilutive effect of convertible instruments		-			39,403,589		3,489,543		-
Diluted weighted-average of common stock		8,485,145			47,461,137		12,296,538		7,941,624
Net loss per common share from:
Basic	$	(0.05	)	$	0.00	$	0.05	$	(0.02	)
Diluted	$	(0.05	)	$	0.00	$	0.03	$	(0.02	)

| F-10 |

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Dividends

The Company has not yet adopted any policy regarding payment of dividends. No dividends have been paid or declared since inception.

IncomeTaxes

The Company follows FASB Codification Topic 740-10-25 (ASC 740-10-25) for recording the provision for income taxes. Deferred tax assets and liabilities are computed based upon the difference between the financial statement and income tax basis of assets and liabilities using the enacted marginal tax rate applicable when the related asset or liability is expected to be realized or settled. Deferred income tax expenses or benefits are based on the changes in the asset or liability each period. If available evidence suggests that it is more likely than not that some portion or all of the deferred tax assets will not be realized, a valuation allowance is required to reduce the deferred tax assets to the amount that is more likely than not to be realized. Future changes in such valuation allowance are included in the provision for deferred income taxes in the period of change.

Deferred income taxes may arise from temporary differences resulting from income and expense items reported for financial accounting and tax purposes in different periods. Deferred taxes are classified as current or non-current, depending on the classification of assets and liabilities to which they relate. Deferred taxes arising from temporary differences that are not related to an asset or liability are classified as current or non-current depending on the periods in which the temporary differences are expected to reverse.

RecentPronouncements

In February 2016, the FASB issued ASU 2016-02, Leases, which will amend current lease accounting to require lessees to recognize (i) a lease liability, which is a lessee’s obligation to make lease payments arising from a lease, measured on a discounted basis, and (ii) a right-of-use asset, which is an asset that represents the lessee’s right to use, or control the use of, a specified asset for the lease term. ASU 2016-02 does not significantly change lease accounting requirements applicable to lessors; however, certain changes were made to align, where necessary, lessor accounting with the lessee accounting model. This standard was effective for fiscal years beginning after December 15, 2018, including interim periods within those fiscal years. The Company elected the practical expedient under ASU 2018-11 “Leases: Targeted Improvements” which allows the Company to apply the transition provision for Topic 842 at the Company’s adoption date instead of at the earliest comparative period presented in the financial statements. Therefore, the Company recognized and measured leases existing at January 1, 2019 but without retrospective application. Therefore, there was no impact recorded to beginning retained earnings or the statement of operations

The Company evaluated all other recent accounting pronouncements issued and determined that the adoption of these pronouncements would not have a material effect on the financial position, results of operations or cash flows of the Company.

Note3 – Going concern

The accompanying financial statements have been prepared assuming the Company will continue as a going concern. As shown in the accompanying financial statements, the Company has a net loss, accumulated deficit and had a working capital deficit as of September 30, 2021. These conditions raise substantial doubt about the Company’s ability to continue as a going concern.

In order to continue as a going concern, the Company will need, among other things, additional capital resources. The Company is significantly dependent upon its ability, and will continue to attempt, to secure additional equity and/or debt financing. There are no assurances that the Company will be successful and without sufficient financing it would be unlikely for the Company to continue as a going concern.

The financial statements do not include any adjustments relating to the recoverability and classification of recorded assets, or the amounts of and classification of liabilities that might be necessary in the event the Company cannot continue in existence. These financial statements do not include any adjustments that might arise from this uncertainty.

| F-11 |

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Note4 – Commitments and contingencies

Contingencies

On

November 6, 2015, Daniel Sullivan sent a wage claim demand to the Company. Mr. Sullivan purports to have had an Independent Contractor Agreement with the Company which provides he is entitled to certain compensation and to be reimbursed for Company expenses. The demand claims unpaid compensation in the amount of $8,055 and unreimbursed expenses in the amount of $154,409. The Company denies the agreement was ever signed. If litigation is commenced the Company will defend any claims by Mr. Sullivan.

Mile

High Real Estate Group, an entity owned by Mr. Sullivan, sent correspondence to the Company stating the Mr. Sullivan and/or Mile High Real Estate loaned the Company either directly or directly to contractors, material suppliers or utilities for operating and building remodeling in the amount of $98,150. Counsel for Mr. Sullivan stated that he was still compiling information. The Company is investigating whether Mr. Sullivan and/or Mile High Real Estate Group ever made the alleged loans. The Company will defend any claims of Mile High Real Estate Group.

On

April 14, 2016, the Company entered into an agreement with an unrelated third party to provide the Company with investor relations services. Upon signing the agreement, the Company paid the investor relations consultant $75,000 and agreed to issue the consultant 1,500,000 shares of its restricted common stock. The agreement required the Company to pay the consultant an additional $75,000 prior to June 14, 2016. The Company cancelled the agreement and is of the opinion that the shares are not owed to the consultant. As of September 30, 2021 and December 31, 2020 there was no payable recorded.

During

the nine months ended September 30, 2021 the Company recorded a gain of $4,500 for settlement of a vendor payable.

Financeleases

On

July 25, 2017, the Company recorded a finance lease obligation for a leased a vehicle for $29,390

.

The Company agreed to make 48 monthly payment of $621 .23 including sales tax. The Company recognized this arrangement as a finance lease based on the determination that the lease exceeded 75% of the economic life of the underlying asset. As of September 30, 2021 the lease had been fully paid.

On

April 25, 2018, the Company recorded a finance lease obligation for a leased a vehicle for $38,388 . The Company made a down payment of $7,500 and agreed to make 36 monthly payment of $976.71 including sales tax. The Company recognized this arrangement as a finance lease based on the determination that the lease exceeded 75% of the economic life of the underlying asset. As of September 30, 2021 the lease had been fully paid.

On

August 16, 2018, the Company recorded a finance lease obligation for a leased a vehicle for $58,476 . The Company made a down payment of $20,000 and an additional $10,000 for delivery fees, taxes and its first month payment and agreed to make 36 monthly payments of $1,165.10, including sales tax. The Company recognized this arrangement as a finance lease based on the determination that the lease exceeded 75% of the economic life of the underlying asset. As of September 30, 2021 the lease had been fully paid.

On

On March 1, 2019, the Company recorded finance lease obligation for a leased a vehicle for $64,354.

The Company made a down payment of $30,000

which included delivery fees, taxes and its first month payment and agreed to make 36 monthly payments of $1,129.76, including sales tax. The Company recognized this arrangement as a finance lease based on the determination that the lease exceeded 75% of the economic life of the underlying assets.

| F-12 |

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On

June 2, 2021, the Company recorded finance lease obligation for a leased a vehicle for $56,733 . The Company made a down payment of $3,510 which included delivery fees, taxes and its first month payment and agreed to make 24 monthly payments of $2,765.19, including sales tax. The Company recognized this arrangement as a finance lease based on the determination that the lease exceeded 75% of the economic life of the underlying assets

Schedule of Future Minimum Leases Payments

Future minimum lease payments as of September 30, 2021:
2021	$	29,667
2022 and thereafter		28,165
Total minimum lease payments	$	57,842

OperatingLeases

On

October 27, 2016 the Company sold its building located at 5765 Logan Street Denver, Colorado to an unrelated third party for $1,400,000

.

The Company repaid the mortgage on the building in the amount of $677,681 . After the sale, the Company leased the building from the purchaser of the property. The lease is for an initial term of ten years, with the Company having the option to extend the term of the lease for two additional five-year periods. The lease requires rental payments of $10,000 per month which will increase 2%

annually. The Company paid a $30,000

deposit at the inception of the lease

On May 29, 2018 the Company leased a building located at 4328 E. Magnolia Street, Phoenix, Arizona. The lease is for an initial term of one year, with the Company having the option to extend the term of the lease for additional four year periods. The lease requires rental payments of $3,880 per month which will increase 2% annually. The Company paid a $4,369 deposit at the inception of the lease.

On

January 22, 2019 the Company leased a building located at 7490 Bridgewater Road, Huber Heights, Ohio. The lease is for an initial term of 63 months. The lease requires rental payments of $3,200 per month and will increase to $3,400 between months 28 through 63. The Company paid a $3,200 deposit at the inception of the lease. During the year ended December 31, 2020 the Company terminated the lease agreement. The Company paid a $35,760 cancellation fee included in rent expense and recorded a gain of $8,800 on the termination of the lease.

The

Company adopted ASC 842 and recorded right of use asset and operating lease liability of $1,082,241 The Company used 12% as incremental borrowing rate as is the average interest rate of the Company’s outstanding third party note. The lease agreement gives the Company the option to renew it for two additional 5 year terms but the Company did not consider it likely to exercise that option. Therefore, the Company did not include such amounts in its computations of the present value of remaining lease payment on the adoption date.

Supplemental balance sheet information related to leases is as follows:

Schedule of Operating Leases

September 30, 2021

Operating Leases	Classification	September 30, 2021
Right-of-use assets	Operating right of use assets	$	557,738
Total		$	557,738
Current lease liabilities	Current operating lease liabilities		120,547
Non-current lease liabilities	Long-term operating lease liabilities		473,759
Total		$	594,306

| F-13 |

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Lease term and discount rate were as follows:

Summary of Operating Lease Liabilities

	September 30, 2021
Weighted average remaining lease term (years)		3.75
Weighted average discount rate		12	%

The following summarizes lease expenses for the nine months ended September 30, 2021:

Summary of Lease Expenses

Finance lease expenses:

Depreciation/amortization expense	$	90,092
Interest on lease liabilities		57,481
Finance lease expense	$	147,573

Supplemental disclosures of cash flow information related to leases were as follows:

Schedule of Cash Flow Information Related to Lease

	September 30, 2021
Cash paid for<br> operating lease liabilities	$	79,230
Operating right of use<br> assets obtained in exchange for operating lease liabilities	$	-

Maturities of lease liabilities were as follows as of September 30, 2021:

Schedule of Maturities of Lease Liabilities

	Operating Leases
2021	$	28,401
2022		131,284
2023		105,593
2024		98,931
2025		141,302
2026		107,558
Total		613,069
Less: Imputed interest		(18,763	)
Present value of lease liabilities	$	594,306

December 31, 2020

Operating Leases	Classification	December 31, 2020
Right-of-use assets	Operating right of use assets	$	636,968
Total		$	636,968
Current lease liabilities	Current operating lease liabilities		107,242
Non-current lease liabilities	Long-term operating lease liabilities		565,632
Total		$	672,874

| F-14 |

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Lease term and discount rate were as follows:

	December 31, 2020
Weighted average remaining lease term (years)		4.50
Weighted average discount rate		12	%

The following summarizes lease expenses for the year ended December 31, 2020:

Finance lease expenses:

Depreciation/amortization expense	$	118,291
Interest on lease liabilities		101,934
Finance lease expense	$	220,225

Supplemental disclosures of cash flow information related to leases were as follows:

	December 31, 2020
Cash paid for operating lease liabilities	$	216,587
Operating right of use assets obtained in exchange for operating lease liabilities	$	-

Maturities of lease liabilities were as follows as of December 31, 2020:

	Operating Leases
2021	$	113,320
2022		131,284
2023		105,593
2024		98,931
2025		141,302
2026		107,558
Total		697,988
Less: Imputed interest		(25,114	)
Present value of lease liabilities	$	672,874

Note5 – Fixed assets

Machinery and equipment consisted of the following at:

Schedule of Machinery and Equipment

	September 30, 2021			December 31, 2020
Automotive vehicles	$	485,701		$	398,614
Furniture and equipment		108,265			85,435
Machinery and Equipment		135,706			135,706
Leasehold improvements		141,232			128,414
Fixed assets, total		870,904			748,169
Total : accumulated depreciation		(549,648	)		(451,759	)
Fixed assets, net	$	321,256		$	296,410

Depreciation

expense for the three and nine months ended September 30, 2021 and September 30, 2020 were $37,828, $97,889, $32,359 and $92,899 respectively.

Note6 – Notes payable

Notes payable to non-related parties

During February 2015, the Company borrowed $50,000 from a non-related party. The loan was due and payable on April 6, 2015 and is now payable on demand with interest at 10% per annum. As of September 30, 2021 and December 31, 2020, the principal balance owed on this loan was $50,000 and $50,000, respectively. The due date was extended to January 1, 2022.

| F-15 |

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During April 2015, the Company borrowed $25,000 from a non-related party. The loan is due and payable May 1, 2015 with interest at 6% per year and has a 5% per month penalty upon default. As of September 30, 2021 and December 31, 2020, the principal balance owed on this loan was $25,000 and $25,000, respectively. The due date was extended to January 1, 2022.

On January 5, 2016, the Company borrowed $10,000 from a non-related party. The loan was due and payable on January 5, 2017 and bore interest at 5% per annum and has a 5% per month penalty upon default. During the nine months ended September 30, 2021 the Company repaid $10,000. The principal balance owed on this loan at September 30, 2021 and December 31, 2020 was $0 and $10,000, respectively. The due date was extended to January 1, 2022.

On May 15, 2019 the Company entered in a 12% promissory loan with Helix Funding, LLC for the principle amount of $100,000. The note matures on November 1, 2019. During the year ended December 31, 2020 the Company repaid $100,000 of principle. As of December 31, 2020 the remaining balance on the note is $0.

Convertible notes payable to non-related parties

On

October 18, 2017, the Company borrowed $150,000

from an unrelated third party. The Company paid

$15,250

of fees associated with the loan, which was recorded

as discount and to be amortized over the term of the debt and was fully amortized as of December 31, 2018. The loan bears interest at a rate of 10% (default interest 24% ) and has a maturity date of July 16, 2018. The Holder has the option to convert the outstanding principal and accrued interest into common stock of the Company. The conversion price is the lesser of (1) lowest trading price during the previous 25 days prior to the note agreement or (2) 50% lowest trading price during the 25 days prior to conversion. Covenants: The Borrower shall not, without the Holder’s consent, sell, lease or dispose of any significant portion of its assets outside the ordinary course of business.

During

the year ended December 31, 2018 the Company paid $150,000 to extend the maturity date until May 11, 2019

. During the year ended December 31,

2019, the Company paid $75,000

in extension fees. The note was discounted for

a derivative (see note 8 for details) and the discount of $134,750

is being amortized over the life of the note

using the effective interest method which was fully amortized as of December 31, 2018. During the year ended December 31, 2019 the holder converted $39,478

of accrued interest into 2,178,825

shares of common stock resulting in a loss of

$61,624 . As of September 30, 2021 and December 31, 2020 the balance outstanding on the loan is $0

and $150,000

,

respectively. On May 28, 2021 the Company entered into a settlement and release agreement with the borrower and agreed to pay them discuss additional amount bounded to interest expense for the settlement $400,000

.

The First payment of $200,000

was due upon signing and Company agreed to make

additional $100,000

payments on the 30th and 60th

day after signing. The additional $250,000 settlement was record as interest during the nine months ended September 30, 2021. As of September 30, 2021 accrued interest and the note balance had been repaid.

On March 21, 2018, the Company borrowed $45,000 from an unrelated third party. The Company paid $4,500 of fees associated with the loan and had amortized $3,514 of the costs as of December 31, 2018. The note bears an interest rate: 12% (default interest lesser of 15% or maximum permitted by law) and matures on March 21, 2019. The conversion Feature Convertible immediately after the issuance, the Holder has the option to convert the outstanding principal and accrued interest into common stock of the Company. The Conversion price is 55% of the lowest trading price during the 25 Trading Day periods prior to the Conversion. Covenants: The Borrower shall not, without the Holder’s consent, sell, lease or dispose of any significant portion of its assets outside the ordinary course of business. The note was discounted for a derivative (see note 8 for details) and the discount of $40,500 is being amortized over the life of the note using the effective interest method resulting in $31,623 of interest expense for the year ended December 31, 2018. During the year ended December 31, 2019 $23,223 of principle and interest were converted into 841,602 shares of common stock resulting in a loss of $32,858. During the year ended December 31, 2019 the Company recorded amortization expense of $9,863. On September 18, 2020 Crown Bridge Partners, LLC converted notes payable in the principal amount of $2,980 and $500 of fees into 29,000,000 shares of common stock. No gain or loss was recorded and conversions were made per the terms of agreement. On February 28, 2021 Crown Bridge Partners, LLC converted notes payable in the principal amount of $9,510 and $500 of fees into 26,000,000 shares of common stock. During the nine months ended September 30, 2021 the Company repaid the remaining principle balance of $9,708. As of September 30, 2021 and December 31, 2020 there was a balance remaining on the loan of $0 and $19,218, respectively.

| F-16 |

| --- |

During

the nine months ended September 30, 2021 and 2020, the Company recognized amortization expense of $0 and $8,710 of discount from derivative liabilities.

Note7 – Notes payable – related parties

On

July 31, 2014, the Company borrowed $98,150 from an entity controlled by an officer and shareholder of the Company. The loan is due and payable on demand and bears no interest. As of September 30, 2021 and December 31, 2020, the principal balance owed on this loan is $98,150 and $98,150, respectively.

As of December 31, 2014, a related party loaned the Company $10,000, in the form of cash and expenses paid on behalf of the Company. The loan is due January 1, 2022 and bears no interest. During the year ended December 31, 2015 the Company borrowed an additional $20,000. During the nine months ended September 30, 2021 the Company repaid $10,000 of principle. As of September 30, 2021 and December 31, 2020, the principal balance owed on this loan was $20,000 and $30,000, respectively.

As

of December 31, 2014, a related party loaned the Company $180,121, in the form of cash and expenses paid on behalf of the Company. The loan is due and payable on demand and bears no interest. The Company repaid $125,500 towards this note during 2015 and as of September 30, 2021 and December 31, 2020; the principal balance owed on this loan was $54,621 and $54,621, respectively.

On July 7, 2016, the Company borrowed $73,000 from a related party. The loan was due and payable on July 7, 2017 and bore interest at 5% per annum. The holder of the note has agreed to extend the default date of the note to January 1, 2022.

On August 8, 2016, the Company entered into a promissory note with Hypur Inc., a Nevada Corporation, a related party, pursuant to which the Company borrowed $52,000. If an Event of Default remains uncured after 30 days Holder has the option to convert the outstanding principal balance and any accrued but unpaid interest, into unrestricted $0.001 par value common stock of the Borrower The loan was due and payable on August 10, 2017 and bore interest at 18% per annum. During the nine months ended September 30, 2021 the Company repaid $52,000, The principle balance owed on this loan at June 30, 2021 and December 31, 2020 was $0 and $52,000, respectively. The Note is currently in default at bears a default rate of interest of 24% per annum as part of the default terms of this note. Upon default, if the default has not been remedied within 30 days, the redemption price would be 150% of the principal amount.

On September 20, 2016, the Company borrowed $47,500 from Hypur Inc., which is a related party. The loan is due and payable on December 20, 2016 and bears interest at 18% per annum. If an Event of Default remains uncured after 30 days Holder has the option to convert the outstanding principal balance and any accrued but unpaid interest, into unrestricted $0.001 par value common stock of the Borrower. The principal balance owed on this loan at September 30, 2021 and December 31, 2020 was $47,500 and $47,500, respectively. The loan is currently past due and in default. The Note is currently in default at bears a default rate of interest of 24% per annum as part of the default terms of this note. Upon default, and if the default has not been remedied within 30 days, the redemption price would be 150% of the principal amount. The notes are in default as of September 30, 2021 and December 31, 2020, but the holder has agreed to waive the 150% redemption price default term.

On October 29, 2018, the Company borrowed $100,000 from Hypur Inc., which is a related party. The loan is due and payable on January 28, 2019 and bears interest at 18% per annum. If an Event of Default remains uncured after 30 days Holder has the option to convert the outstanding principal balance and any accrued but unpaid interest, into unrestricted $0.001 par value common stock of the Borrower. Upon default the note bears a default rate of interest of 24% per annum as part of the default terms of this note. The principal balance owed on this loan at September 30, 2021 and December 31, 2020 was $100,000 and $100,000, respectively. The note was discounted for a derivative (see note 8 for details) and the discount of $89,350 is being amortized over the life of the note using the effective interest method resulting in $89,350 of interest expense for the year ended December 31, 2019. As of September 30, 2021 and December 31, 2020 the note is currently in default.

| F-17 |

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On November 21, 2018, the Company borrowed $70,000 from Hypur Inc., which is a related party. The loan is due and payable on February 19, 2019 and bears interest at 18% per annum. If an Event of Default remains uncured after 30 days Holder has the option to convert the outstanding principal balance and any accrued but unpaid interest, into unrestricted $0.001 par value common stock of the Borrower. Upon default the note bears a default rate of interest of 24% per annum as part of the default terms of this note. The principal balance owed on this loan at September 30, 2021 and December 31, 2020 was $70,000 and $70,000, respectively. The note was discounted for a derivative (see note 8 for details) and the discount of $55,830 is being amortized over the life of the note using the effective interest method resulting in $55,830 of interest expense for the year ended December 31, 2019. As of September 30, 2021 and December 31, 2020 the note is currently in default.

On November 26, 2018, the Company borrowed $75,000 from Hypur Inc., which is a related party. The loan is due and payable on February 24, 2019 and bears interest at 18% per annum. If an Event of Default remains uncured after 30 days Holder has the option to convert the outstanding principal balance and any accrued but unpaid interest, into unrestricted $0.001 par value common stock of the Borrower. Upon default the note bears a default rate of interest of 24% per annum as part of the default terms of this note. The principal balance owed on this loan at September 30, 2021 and December 31, 2020 was $75,000 and $75.000, respectively. The note was discounted for a derivative (see note 8 for details) and the discount of $58,913 is being amortized over the life of the note using the effective interest method resulting in $58,913 of interest expense for the year ended December 31, 2019. As of September 30, 2021 and December 31, 2020 the Note is currently in default.

On May 10, 2019, the Company borrowed $75,000 from Hypur Inc., which is a related party. The loan is due and payable on May 12, 2020 and bears interest at 18% per annum. If an Event of Default remains uncured after 30 days Holder has the option to convert the outstanding principal balance and any accrued but unpaid interest, into unrestricted $0.001 par value common stock of the Borrower. Upon default the note bears a default rate of interest of 24% per annum as part of the default terms of this note. The principal balance owed on this loan at September 30, 2021 and December 31, 2020 was $

75,000

. As of September 30, 2021 and December 31, 2020 the Note is currently in default.

On September 3, 2019, the Company borrowed $21,000 from Hypur Inc., which is a related party. The loan is due and payable on December 3, 2019 and bears interest at 18% per annum. If an Event of Default remains uncured after 30 days Holder has the option to convert the outstanding principal balance and any accrued but unpaid interest, into unrestricted $0.001 par value common stock of the Borrower. Upon default the note bears a default rate of interest of 24% per annum as part of the default terms of this note. The principal balance owed on this loan at September 30, 2021 and December 31, 2020 was $

21,000

. As of September 30, 2021 and December 31, 2020 the Note is currently in default.

During

the year ended December 31, 2020, the Company repaid Patrick Deparini $575.

Convertiblenotes payable to related parties

On November 13, 2015, the Company borrowed $25,000 from Hypur Inc., which is a related party. The loan is due and payable on November 12, 2015 and bears interest at 18% per annum. If an Event of Default remains uncured after 30 days Holder has the option to convert the outstanding principal balance and any accrued but unpaid interest, into unrestricted $0.001 par value common stock of the Borrower. Upon default the note bears a default rate of interest of 24% per annum as part of the default terms of this note. During the nine months ended September 30, 2021 the Company repaid $25,000. The principal balance owed on this loan at September 30, 2021 and December 31, 2020 was $0 and $25,000, respectively.

In November 2015, the Company entered into an arrangement with a related party, whereby the Company borrowed $25,000 in Convertible Notes. The Convertible Note bears interest at a rate of 5% per annum and payable quarterly in arrears and matures twelve months from the date of issuance, and is convertible into shares of the Company’s common stock at a per share conversion price equal $25K repayment is for OMB to $0.025. The note was due on November 4, 2016. In December 2015 the lender loaned the Company an additional $20,000 with same terms except that it is payable upon demand. During the nine months ended September 30, 2021 the Company repaid $45,000 of principal and $6,767 of accrued interest. As of September 30, 2021 and December 31, 2020, the Company owed a total of $0 and $45,000, respectively. The holder of the note has agreed to extend the default date of the note to January 1, 2022.

| F-18 |

| --- |

In

July 2015, the Company entered into an arrangement with a related party, whereby the Company could borrow up to $500,000 in Convertible Notes. The Convertible Note bears interest at a rate of 5% per annum and payable quarterly in arrears and matures twelve months from the date of issuance, and is convertible into shares of the Company’s common stock at a per share conversion price equal to $0.025. Upon the occurrence and during the continuation of an event of default, the holder may require the Company to redeem all or any portion of this Note in cash at a price equal to 150% of the principal amount. During the year ended December 31, 2017, the Company borrowed an additional $110,000. As of September 30, 2021 and December 31, 2020, the Company owed a total of $475,000 and $475,000, respectively. Since the debt holder has not elect the right to require the Company to redeem the note at a price equal to 150% of the principal amount, the terms stated prior to maturity are still in effect. The holder has waived the default term and the note is not considered to be in default as of September 30, 2021 and December 31, 2020.

On

September 1, 2016, the Company entered into, an convertible promissory note with Hypur Ventures, L.P., a Delaware limited partnership (the “Hypur Ventures”) which is a related party pursuant to which the Company to borrow $75,000. The loan was due 180 days from the date of issuance and bears interest at 10% per annum. The note is convertible into common stock at a price of $.05 per share. The note is mandatory redeemable into common stock if the price per share is over $.50 per share during a 10 day period. The principal balance owed on this loan at September 30, 2021 and December 31, 2020 was $75,000 and $75,000, respectively. Upon default, the note bears a default rate of interest of 15% per annum, and if the default has not been remedied within 30 days, the redemption price would be 150% of the principal amount. As of September 30, 2021 and December 31, 2020, Hyper has waived the default provision until January 1, 2022.

On October 14, 2016, the Company entered into a convertible promissory note with Hypur Ventures, L.P., a Delaware limited partnership (the “Hypur Ventures”) and a related party, pursuant to which the Company borrowed $100,000.

The loan was due 180 days from the

date of issuance and bears interest at 10% per annum. The note is convertible into common stock at a price of $.05 per share. The note is mandatory redeemable into common stock if the price per share is over $.50 per share during a 10 day period. The principal balance owed on this loan at September 30, 2021 and December 31, 2020 was $100,000 and $100,000, respectively. Upon default, the note bears a default rate of interest of 15% per annum, and if the default has not been remedied within 30 days, the redemption price would be 150% of the principal amount. As of September 30, 2021 and December 31, 2020, Hyper has waived the default provision until January 1, 2022.

On March 7, 2017, the Company borrowed $100,000 from Hypur Ventures, L.P., a related party.

The loan is due 180 days from March 7, 2017

and bears interest at 10% per annum. The loan is convertible into shares of the Company’s common stock at a price of $.05 per share. The loan will automatically convert into shares of the Company’s common stock if the price of the Company’s common stock is over $.50 per share during any ten-day period. The principal balance owed on this loan September 30, 2021 and December 31, 2020 was $100,000 and $100,000 respectively. Upon default, the note bears a default rate of interest of 15% per annum, and if the default has not been remedied within 30 days, the redemption price would be 150% of the principal amount. As of September 30, 2021 and December 31, 2020, Hyper has waived the default provision until January 1, 2022.

On May 26, 2017, the Company borrowed $100,000 from CGDK, a related party. The loan is due 360 days from May 26, 2017 and bears interest at 5% per annum. The loan is convertible into shares of the Company’s common stock at a price of $.025 per share. The loan will automatically convert into shares of the Company’s common stock if the price of the Company’s common stock is over $.25 per share during any ten-day period. The principal balance owed on this loan at September 30, 2021 and December 31, 2020 was $100,000 and $100,000, respectively. As of September 30, 2021 and December 31, 2020 the note was currently in default.

On

July 13, 2017, the Company borrowed $150,000 from CGDK, a related party. The loan is due 360 days from July 13, 2017, and bears interest at 5% per annum. The loan is convertible into shares of the Company’s common stock at a price of $.05 per share. The loan will automatically convert into shares of the Company’s common stock if the price of the Company’s common stock is over $.25 per share during any ten-day period. The principal balance owed on this loan at September 30, 2021 and December 31, 2020 was $150,000. The conversion feature has been waved through October 15, 2019. As of September 30, 2021 and December 31, 2020, the note is currently in default.

| F-19 |

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On

April 13, 2018, the Company borrowed $130,000 from CGDK, a related party. The loan is due 360 days from April 13, 2018, bears interest at 12% per annum. The loan is convertible into shares of the Company’s common stock at a price of $.05 per share. The loan will automatically convert into shares of the Company’s common stock if the price of the Company’s common stock is over $.25 per share during any ten-day period. The Company recorded a discount of $101,272 due to derivative. The Company amortized $72,694 in debt discounts during the year ended December 31, 2018. The Company amortized $27,560 in debt discounts during the year ended December 31, 2019. The principal balance owed on this loan at September 30, 2021 and December 31, 2020 is $130,000 and $130,000, respectively. On November 5, 2019 CGDK waived the default provision until January 1, 2022.

On

June 14, 2018, the Company issued a note payable in the amount of $30,217 to CGDK, a related party, for previous expenses paid on behalf of the Company. The loan is due 360 days from June 18, 2018, bears interest at 12% per annum. The loan is convertible into shares of the Company’s common stock at a price of $.05 per share. The loan will automatically convert into shares of the Company’s common stock if the price of the Company’s common stock is over $.25 per share during any ten-day period. The Company recorded a debt discount of $10,292 due to derivative. During the year ended December 31, 2018 the Company amortized $5,639 of the discount. The Company amortized $3,697 in debt discounts during the year ended December 31, 2019. The principal balance owed on this loan at September 30, 2021 and December 31, 2020 is $30,217 and $30,217, respectively. On November 5, 2019 CGDK waived the default provision until June 14, 2020. On December 22, 2020 the Company received a waiver from CGDL, LLC extending the maturity of the note to June 14, 2021.

On

July 2, 2018, the Company borrowed $150,000 from CGDK, a related party. The loan is due July 2, 2019 and bears interest at 12% per annum. The loan is convertible into shares of the Company’s common stock at a price of $.05 per share. The loan will automatically convert into shares of the Company’s common stock if the price of the Company’s common stock is over $.10 per share during any ten-day period or the trading volume of the Company’s common stock during these ten trading days was at least 2,500,000 shares. The Company recorded a debt discount of $19,779 due to derivative. During the year ended December 31, 2018 the Company amortized $9,862 of the discount. The Company amortized $7,390 in debt discounts during the year ended December 31, 2019. The principal balance owed on this loan at September 30, 2021 and December 31, 2019 is $150,000 and $150,000, respectively. On November 5, 2019 CGDK waived the default provision until July 2, 2020. On December 22, 2020 the Company received a waiver from CGDL, LLC extending the maturity of the loan to June 14, 2021.

On

August 6, 2018, the Company borrowed $150,000 from CGDK, a related party. The loan is due July 2, 2019 and bears interest at 12% per annum. The loan is convertible into shares of the Company’s common stock at a price of $.05 per share. The loan will automatically convert into shares of the Company’s common stock if the price of the Company’s common stock is over $.10 per share during any ten-day period or the trading volume of the Company’s common stock during these ten trading days was at least 2,500,000 shares. The Company recorded a debt discount of $20,095 due to derivative. During the year ended December 31, 2018 the Company amortized $8,093 of the discount. The Company amortized $7,793 in debt discounts during the year ended December 31, 2019. The principal balance owed on this loan at September 30, 2021 and December 31, 2020 is $150,000 and $150,000, respectively. On November 5, 2019 CGDK waived the default provision until August 6, 2020. On December 22, 2020 the Company received a waiver from CGDL, LLC extending the maturity of the loan to June 14, 2021.

On

January 18, 2019, the Company entered into, a convertible promissory note with Hypur Ventures, L.P., a Delaware limited partnership (the “Hypur Ventures”) which is a related party pursuant to which the Company to borrow $250,000. The loan was due 10 days from the date of issuance and bears interest at 18% per annum. The note is convertible into common stock at a price at the lower of $.02 per share or 60% of the closing price of the common stock prior to conversion. Upon default, the note bears a default rate of interest of 24% per annum. The note was discounted for a derivative (see note 8 for details) and the discount of $167,079 is being amortized over the life of the note using the effective interest method resulting in $167,079 of interest expense for the year ended December 31, 2019. As of September 30, 2021 and December 31, 2020 the note is currently in default.

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On

March 5, 2019, the Company entered into, an convertible promissory note with Hypur Ventures, L.P., a Delaware limited partnership (the “Hypur Ventures”) which is a related party pursuant to which the Company to borrow $50,000. The loan was due 10 days from the date of issuance and bears interest at 18% per annum. The note is convertible into common stock at a price at the lower of $.02 per share or 60% of the closing price of the common stock prior to conversion. Upon default, the note bears a default rate of interest of 24% per annum. As of September 30, 2021 and December 31, 2020 the note is currently in default.

On October 1, 2017, these notes were tainted by the variable conversion price notes and remained tainted as of December 31, 2019. The Company re-measured the fair value of derivative liabilities on September 30, 2021 and December 31, 2020. See Note 8.

Note8 – Derivative Liability

The Company analyzed the conversion options for derivative accounting consideration under ASC 815, Derivatives and Hedging, and determined that an instrument should be classified as a liability when a conversion option becomes effective.

The derivative liability in connection with the conversion feature of the convertible debt is measured using level 3 inputs.

The change in the fair value of derivative liabilities is as follows:

Schedule of Derivative Liabilities at Fair Value

Balance - December<br> 31, 2019	$	1,170,060
Addition of new derivative<br> as a derivative loss		-
Settlement of derivatives<br> upon conversion		(14,327	)
Debt discount from derivative<br> liability		176,858
Loss on change in fair<br> value of the derivative		915,054
Balance - December 31,<br> 2020	$	2,247,645
Settlement of derivatives<br> upon conversion		(403,283	)
Loss<br> on change in fair value of the derivative		99,347
Balance<br> – September 30, 2021	$	1,943,709

The table below shows the Black-Scholes option-pricing model inputs used by the Company to value the derivative liability at each measurement date:

Schedule of Derivative Instruments, Black-Scholes Option-pricing Model Inputs Used


Expected term	0.25 – 1.09 years		0.08 – 1.01 years
Expected average volatility	177.76% – 307.33	%	291.56% – 378.27	%
Expected dividend yield	-		-
Risk-free interest rate	0.40% – 0.90	%	0.08% – 0.15	%

Note9 – Stockholders’ equity

The

Company was originally authorized to issue 100,000,000

shares of common stock and 100,000,000

shares of preferred stock. On May 6, 2014, the Company effected a forward stock split and a pro-rata increase in its authorized common stock on a basis of 14-to-1, whereby each shareholder received 14 newly issued shares of common stock for each 1 share held.

Additionally,

the number of authorized shares increased to 1,400,000,000 shares of common stock. All references to share and per share amounts in the consolidated financial statements and these notes thereto have been retroactively restated to reflect the forward stock split.

All

references to share and per share amounts in the consolidated financial statements and accompanying notes thereto have been retroactively restated to reflect the forward stock split. The Company issued a total of 1,570 shares of common stock due to rounding on the reverse stock split.

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Commonstock

On

February 28, 2021 Crown Bridge Partners, LLC converted notes payable in the principal amount of $9,510 and $500 of fees into 260,000 shares of common stock.

Preferredstock

On May 3, 2016, the Company entered into, an agreement with Hypur Ventures, L.P., a Delaware limited partnership (the “Hypur Ventures”) which is a related party pursuant to which the Company sold to Hypur Ventures, in a private placement, 10,000,000 shares of the Company’s preferred stock and 5,000,000 common stock warrants with a five year term and an exercise price of $0.10, at a purchase price of $0.05 per share for gross proceeds of $500,000. The shares of preferred stock are convertible into shares of the Company’s common stock. The preferred stock shall have such other rights, preferences and privileges to be set forth in a certificate of designation to be filed with the Nevada Secretary of State. The Company evaluated the convertible preferred stock under FASB ASC 470-20-30 and determined it contained a beneficial conversion feature. The intrinsic value of the beneficial conversion feature was determined to be $114,229. The beneficial conversion feature was fully amortized and recorded as a deemed dividend.

Between July and August of 2016 Hypur Ventures purchased an additional 10,000,000 shares of the Company’s preferred stock and 5,000,000 common stock warrants with a five year term and an exercise price of $0.10, at a purchase price of $0.05 per share for net proceeds of $445,000, net of legal fees of $55,000. The shares of preferred stock are convertible into shares of the Company’s common stock. The preferred stock shall have such other rights, preferences and privileges to be set forth in a certificate of designation to be filed with the Nevada Secretary of State. The Company evaluated the convertible preferred stock under FASB ASC 470-20-30 and determined it does not contain a beneficial conversion feature. The intrinsic value of the beneficial conversion feature was determined to be $0. The preferred stock is convertible at any time at the election of Hypur Ventures. The preferred stock shall automatically convert to common stock if the closing price of the Company’s common stock equals or exceeds $.50 per share over any consecutive twenty day trading period. The preferred stock terms include a one-time purchase price preference. No preferential dividends apply to the preferred stock. The preferred stock attributes include weighted average anti-dilution protection, rights to appoint one director, pre-emptive rights to purchase future offerings of securities by the Company, demand and piggy-back registration rights.

The

preferred stock is convertible at any time at the election of Hypur Ventures. The preferred stock shall automatically convert to common stock if the closing price of the Company’s common stock equals or exceeds $.50 per share over any consecutive twenty day trading period. The preferred stock terms include a one-time purchase price preference. No preferential dividends apply to the preferred stock. The preferred stock attributes include weighted average anti-dilution protection, rights to appoint one director, pre-emptive rights to purchase future offerings of securities by the Company, demand and piggy-back registration rights.

The Company has reserved thirty million shares of common stock that may be issued upon the conversion and/or exercise of the preferred stock and the warrants. The preferred stock sold to Hypur Ventures will be subject to the terms and conditions of the Certificate of Designation, as well as further documentation to be drafted in accordance with the terms and conditions agreed upon between the Company and Hypur Ventures.

Note10 – Options and warrants

Options

All stock options have an exercise price equal to the fair market value of the common stock on the date of grant. The fair value of each option award is estimated using a Black-Scholes-Merton option valuation model. The Company has not paid any cash dividends on its common stock and does not anticipate paying any cash dividends in the foreseeable future. Consequently, the Company uses an expected dividend yield of zero in the Black-Scholes-Merton option valuation model. Volatility is an estimate based on the calculated historical volatility of similar entities in industry, in size and in financial leverage, whose share prices are publicly available. The expected life of awards granted represents the period of time that they are expected to be outstanding. The Company has no historical experience with which to establish a basis for determining an expected life of these awards. Therefore, the Company only gave consideration to the contractual terms and did not consider the vesting schedules, exercise patterns and pre-vesting and post-vesting forfeitures significant to the expected life of the option award. The Company bases the risk-free interest rate used in the Black-Scholes-Merton option valuation model on the implied yield currently available on U.S. Treasury issues with an equivalent remaining term equal to the expected life of the award.

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All of the options granted by the Company expired as of December 31, 2020.

The following is a summary of the Company’s stock option activity for the year ended December 31, 2020:

Summary of Stock Option Activity

			Weighted-Average<br> <br>Exercise Price
Outstanding at December 31, 2019	240,117		$	1.10
Granted	-		$	-
Expired	(240,117	)	$	1.10
Cancelled	-		$	-
Outstanding at December 31, 2020	-		$	-
Options exercisable at December 31, 2020	-		$	-

No stock options were granted during the nine months ended September 30, 2021.

The following tables summarize information about stock options outstanding and exercisable at September 30, 2021 and December 31, 2020:

Schedule of Stock Options Outstanding and Exercisable Exercise Price Range

OPTIONS<br> OUTSTANDING AND EXERCISABLE AT DECEMBER 31, 2020
Range<br> of<br> Exercise Prices		Number of Options Outstanding		Weighted- Average Remaining Contractual Life in Years		Weighted- Average Exercise Price		Number Exercisable		Weighted- Average Exercise Price
$	-		-		-	$	-		-	$	-

Total stock-based compensation expense in connection with options and modified awards recognized in the consolidated statement of operations for nine months ended September 30, 2021 and 2020 was $0 and $0 respectively.

Warrants

The following is a summary of the Company’s warrant activity for the nine months ended September 30, 2021:

Summary of Warrants Activity

			Weighted-Average<br> <br>Exercise Price
Outstanding at December 31, 2020	100,000		$	1.00
Granted	-		$	-
Expired	(100,000	)	$	1.00
Cancelled	-		$	-
Outstanding at September 30, 2021	-		$	1.00
Warrants exercisable at December 31, 2020	100,000		$	1.00
Warrants exercisable at September 30, 2021	-		$	-

The following tables summarize information about warrants outstanding and exercisable at December 31, 2020:

Schedule of Warrants Outstanding and Exercisable Exercise Price Range

WARRANTS OUTSTANDING AND EXERCISABLE AT DECEMBER 31, 2020
Range of<br> Exercise <br> Prices		Number of<br> <br>Warrants<br> <br>Outstanding		Weighted-<br> <br>Average<br> <br>Remaining<br> <br>Contractual Life<br> <br>in Years		Weighted-<br> <br>Average<br> <br>Exercise Price		Number<br> <br>Exercisable		Weighted-<br> <br>Average<br> <br>Exercise Price
$	1.00		100,000		.52	$	1.00		100,000	$	1.00

Note11 – Subsequent events

The Company has evaluated all other subsequent events from the balance sheet date through the date the financial statements were issued and has determined there are no additional events required to be disclosed.

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ITEM 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATION

You should read the following discussion and analysis of financial condition and results of operations in conjunction with the consolidated financial statements and related notes appearing elsewhere in this Report.

We were originally incorporated in Nevada on September 11, 2006, under the name The Engraving Masters, Inc. (the “Company”).

On May 2, 2014, we changed our name to Blue Line Protection Group, Inc.

We provide armed protection and transportation, banking, compliance and training services for businesses engaged in the legal cannabis industry. During the nine months ended September 30, 2021 substantially all of our revenue was derived from transportation and currency processing services.

It is estimated that the total market for marijuana, legal or otherwise, will exceed the economic value of corn and wheat combined. Marijuana is widely considered the largest cash crop in the United States. Businesses have been positioning themselves for years, each trying to establish a leadership position in the legal marijuana industry.

Cultivation facilities are the producers of legal cannabis that eventually make its way to consumers. Growers’ operations typically span a large geographic footprint, making them susceptible to theft, as are shipments from the growers to testing laboratories or to retail dispensaries. Additionally, due to current federal marijuana legislation and banking environment, growers are finding it increasingly difficult to secure their cash, purchase equipment and obtain financing for expansion.

Dispensaries are the retail face of the legal cannabis industry. All legal sales of cannabis products are transacted through dispensaries that are state-licensed. To maintain their licenses, dispensaries must comply with a variety of state-mandated reporting requirements, including reporting every gram of cannabis passing in and out of the store. Dispensaries also face financing and banking challenges similar to those that growers encounter.

We do not grow, test, transport or sell marijuana.

ArmedProtection and Transportation

Fundamental to the legal cannabis industry is the protection of product and cash throughout the distribution channel. Growers ship product from their cultivation facilities to independent laboratories where it is tested for compliance with state-mandated parameters. From the labs, the product is then delivered to the retail dispensaries, where it is sold to the public.

Due to the current banking and regulatory environments, payments between each step in the distribution network are made in cash: from the customer back to the grower. Therefore, these businesses are forced into having to transport bags of money between growers and dispensaries and their own vaults or storage facilities.

The risk of theft of cash and product is present at every stage, even when they are not in transit. Accordingly, all cannabis businesses require security measures to prevent theft, mitigate risk to employees and maintain regulatory compliance.

We began our security and protection operations in Colorado in February 2014. Since then, we have become the largest legal cannabis protection services company in the state. We offer a fully integrated approach to managing the movement of cannabis and cash from growers through dispensaries via armed and armored transport, money processing, vaulting and related credit. Money processing services generally include counting, sorting and wrapping currency.

As of December 31, 2019 we discontinued our Service-Guards segment.

We also offer security monitoring, asset vaulting, and VIP and dignitary protection.

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Resultsof Operations

Material changes in line items in our Statement of Operations for the three months ended September 30, 2021 as compared to the same period last year, are discussed below:

	Increase (I)<br> or
Item	Decrease<br> (D)	Reason
Revenue	I	Increase<br> in customer services
Interest expense	D	Reduction<br> in debt
Loss on change in fair value of derivative securities	I	Reduction<br> in debt and change in stock price

Material changes in line items in our Statement of Operations for the nine months ended September 30, 2021 as compared to the same period last year, are discussed below:

	Increase (I)<br> or
Item	Decrease<br> (D)	Reason
Revenue	I	Increase in customer services
Interest expense	I	Settlement<br> interest on debt
Loss on change in fair value of derivative securities	D	Decrease<br> in the price of our common stock and reduction of debt

CapitalResources and Liquidity

Our material sources and <uses> of cash during the nine months ended September 30, 2021 and 2020 were:

	2021			2020
Cash provided (used) by operations	$	643,139		$	382,152
Purchase of equipment		<66,000	>		<24,970	>
Loan proceeds		-			24,000
Loan payments		<368,406	>		<118,037	>

As of September 30, 2021 we did not have any material capital commitments other than loan payments.

Other than as disclosed in this Item 2, we do not anticipate any material capital requirements for the twelve months ending September 30, 2022.

Other than as disclosed above, we do not know of any:

●	trends, demands, commitments,<br> events or uncertainties that will result in, or that are reasonable likely to result in, our liquidity increasing or decreasing in<br> any material way; or
●	any significant changes<br> in our expected sources and uses of cash.

We do not have any commitments or arrangements from any person to provide us with any equity capital.

During the next twelve months, we anticipate that we will incur approximately $1,200,000 of general and administrative expenses in order to execute our current business plan. We also plan to incur significant sales, marketing, research and development expenses during the next 12 months. We must obtain additional financing to continue our operations. We may not be able to obtain additional funding on terms that are favorable to us or at all. We may not be able to obtain sufficient funding to continue our operations, or if we do receive funding, to generate adequate revenues in the future or to operate profitably in the future. These conditions raise substantial doubt about our ability to continue as a going concern.

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Off-BalanceSheet Arrangements

We have not entered into any off-balance sheet arrangements.

CriticalAccounting Policies

Management considers the following policies critical because they are both important to the portrayal of our financial condition and operating results, and they require management to make judgments and estimates about inherently uncertain matters.

Accountsreceivable. Accounts receivable are stated at the amount we expect to collect from outstanding balances and do not bear interest. We provide for probable uncollectible amounts through an allowance for doubtful accounts, if an allowance is deemed necessary. The allowance for doubtful accounts is our best estimate of the amount of probable credit losses in our existing accounts receivable; however, changes in circumstances relating to accounts receivable may result in a requirement for additional allowances in the future. On a periodic basis, management evaluates our accounts receivable and determines the requirement for an allowance for doubtful accounts based on its assessment of the current and collectible status of individual accounts with past due balances over 90 days. Account balances are charged against the allowance after all collection efforts have been exhausted and the potential for recovery is considered remote.

Revenuerecognition. In May 2014, the FASB issued ASU No. 2014-09, “Revenue from Contracts with Customers (Topic 606),” which supersedes the revenue recognition requirements in Accounting Standards Codification 605, “Revenue Recognition.” This ASU is based on the principle that revenue is recognized to depict the transfer of goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. The ASU also requires additional disclosure about the nature, amount, timing and uncertainty of revenue and cash flows arising from customer contracts, including significant judgments and changes in judgments and assets recognized from costs incurred to obtain or fulfill a contract. ASC 606-10-50-5 requires that entities disclose disaggregated revenue information in categories (such as type of good or service, geography, market, type of contract, etc.) that depict how the nature, amount, timing, and uncertainty of revenue and cash flow are affected by economic factors. ASC 606-10-55-89 explains that the extent to which an entity’s revenue is disaggregated depends on the facts and circumstances that pertain to the entity’s contracts with customers and that some entities may need to use more than one type of category to meet the objective for disaggregating revenue. In August 2015, the FASB issued ASU No. 2015-14, which deferred the effective date of the new revenue standard by one year, and allowed entities the option to early adopt the new revenue standard as of the original effective date. There have been multiple standards updates amending this guidance or providing corrections or improvements on issues in the guidance. The requirements for these standards relating to Topic 606 are effective for interim and annual periods beginning after December 15, 2017. This standard permitted adoption using one of two transition methods, either the retrospective or modified retrospective transition method.

We adopted these standards at the beginning of the first quarter of fiscal 2018 using the modified retrospective method. The adoption of these standards did not have an impact on our Statements of Operations for the nine months ended September 30, 2021.

Stock-basedcompensation. We record stock based compensation in accordance with the guidance in ASC Topic 505 and 718, which requires us to recognize expenses related to the fair value of our employee stock option awards. This eliminates accounting for share-based compensation transactions using the intrinsic value and requires instead that such transactions be accounted for using a fair-value-based method. We recognize the cost of all share-based awards on a graded vesting basis over the vesting period of the award.

EquityInstruments. We account for equity instruments issued in exchange for the receipt of goods or services from non-employees in accordance with FASB ASC 718-10 and the conclusions reached by the FASB ASC 505-50. Costs are measured at the estimated fair market value of the consideration received or the estimated fair value of the equity instruments issued, whichever is more reliably measureable. The value of equity instruments issued for consideration other than employee services is determined on the earliest of a performance commitment or completion of performance by the provider of goods or services as defined by FASB ASC 505-50.

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ITEM 4. CONTROLS AND PROCEDURES

DisclosureControls and Procedures

An evaluation was carried out under the supervision and with the participation of our management, including our Principal Financial Officer and Principal Executive Officer, of the effectiveness of our disclosure controls and procedures as of the end of the period covered by this report on Form 10-Q. Disclosure controls and procedures are procedures designed with the objective of ensuring that information required to be disclosed in our reports filed under the Securities Exchange Act of 1934, such as this Form 10-Q, is recorded, processed, summarized and reported, within the time period specified in the Securities and Exchange Commission’s rules and forms, and that such information is accumulated and is communicated to our management, including our Principal Executive Officer and Principal Financial Officer, or persons performing similar functions, as appropriate, to allow timely decisions regarding required disclosure. Based on that evaluation, our management concluded that, as of September 30, 2021 our disclosure controls and procedures were not effective due to the material weaknesses identified during the audit of our financial statements for the year ended December 31, 2020.

Changein Internal Control over Financial Reporting

Our internal control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements in accordance with generally accepted accounting principles in the United States. Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Therefore, even those systems determined to be effective can provide only reasonable assurance of achieving their control objectives.

There were no changes in our internal control over financial reporting that occurred during the fiscal quarter covered by this report that materially affected or are reasonably likely to materially affect, our internal control over financial reporting.

PART

ITEM

EXHIBITS

Exhibit No.	Description of Exhibit
31.1	Rule 13a-14(a) Certifications
31.2	Rule 13a-14(a) Certifications
32	Section 1350 Certifications
101.INS	Inline XBRL Instance Document
101.SCH	Inline XBRL Taxonomy Extension Schema Document
101.CAL	Inline XBRL Taxonomy Extension Calculation Linkbase Document
101.DEF	Inline XBRL Taxonomy Extension Definition Linkbase Document
101.LAB	Inline XBRL Taxonomy Extension Label Linkbase Document
101.PRE	Inline XBRL Taxonomy Extension Presentation Linkbase Document
104	Cover Page Interactive Data File (embedded within the Inline XBRL document)

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SIGNATURES

In accordance with Section 13 or 15(d) of the Securities Exchange Act of 1934, the registrant has caused this report to be signed on its behalf by the undersigned, thereto duly authorized.

	BLUE LINE PROTECTION GROUP, INC.
October 28, 2021	By:	/s/ Evan DeVoe
		Evan DeVoe, <br><br>Principal Executive, Financial and Accounting<br> Officer

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EXHIBIT31.1

CERTIFICATIONS

I, Evan DeVoe, certify that:

1. I have reviewed this quarterly report on Form 10-Q of Blue Line Protection Group, Inc.;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4. The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15 and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

a) designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

b) designed such internal control over financial reporting, or cause such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

c) evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

d) disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5. The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of the internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

a) all significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

b) any fraud, whether or not material, that involves management or other employees who have significant role in the registrant’s internal control over financial reporting.

October 28, 2021	By:	/s/ Evan DeVoe
		Evan DeVoe,<br><br> <br>Principal Executive Officer

EXHIBIT31.2

CERTIFICATIONS

I, Evan DeVoe, certify that:

1. I have reviewed this quarterly report on Form 10-Q of Blue Line Protection Group, Inc.

b) any fraud, whether or not material, that involves management or other employees who have significant role in the registrant’s internal control over financial reporting.

October 28, 2021	By:	/s/ Evan DeVoe
		Evan DeVoe,<br><br> <br>Principal Financial Officer

EXHIBIT32

In connection with the Quarterly Report of Blue Line Protection Group, Inc. (the “Company”) on Form 10-Q for the period ending September 30, 2021 as filed with the Securities and Exchange Commission (the “Report”), Evan DeVoe, the Company’s Chief Executive and Financial Officer, certifies pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that to the best of his knowledge:

(1)	The Report fully complies<br> with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and
(2)	The information contained<br> in the Report fairly presents, in all material respects, the financial condition and results of the Company.
October 28, 2021	By:	/s/ Evan DeVoe
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		Evan DeVoe,<br><br> <br>Principal Financial Officer