Sugarmade Inc (SGMD)

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https://pbs.twimg.com/media/EsSEuegXAAke8Ya?format=png&name=small

*Post is meant to be constructive info update, imo sgmd does present potential trade opportunity..gl

1)..Purchased Sky Unlimited in 2018
Incorrect..SGMD issued nonrefundable $1m+ share deposit to acquire Sky..The deal never consummated, shares issued...per filings.

2)..Purchased Hydro4Less in 2019..
Incorrect, SGMD released news they were interested in acquiring Hydro4Less, but never finalized.

3)..Acquired BizRight in 2019.
Correct..SGMD did acquire BizRight, but surprisingly, the deal was rescinded just prior to SGMD first Quarterly filing that was to include BizRight revenue numbers..All issued shares reportedly returned to treasury.

4)..Currently leased 5 acres land in North Carolina..
"Sugarmade and LMK Capital have agreed to work toward the negotiation of a definitive lease agreement for access to as much as 40 acres of property in Northern California. The Company intends to use 5 acres of the property to operate a regulated and licensed cannabis cultivation business" per PR...

Sept28 8k Lower Lake cannabis lease agreement..https://www.otcmarkets.com/filing/html?id=14413926&guid=lw4KUFar4IS8Gyh#SGMD-20200928_8KEX10Z1_HTM

5)..Plans to grow 3.6 tons farm to plate.
"Sugarmade's in-house analysis suggests that control over 5 acres of this property carries the potential to yield as much as 8,000 pounds (or more than 3,628,700 grams) of cannabis flower per year." per 9/23 PR.

6)..Wholly owned IBrand cultivation equipment..
IBrand owned by BizRight..Since acquisition deal rescinded, SGMD not involved with any IBrand sales.

7)..Owns 40% Budcars
Correct..SGMD reportedly paid $700k to acquire Budcars 40% in Feb 2020 with 36 month option to acquire additional 30%.... Since late May 2020, the Company has been actively involved in development of Indigo’s operations with power to direct the activities and significantly impact Indigo’s economic performance. The Company also has obligations to absorb losses and right to receive benefits from Indigo. As such, in accordance with ASC 810-10-25-38A through 25-38J, Indigo is consolidated as an VIE of the Company.

Per 10Q.."Sugarmade, Inc. and Subsidiary..(Budcars)

Notes to Unaudited Condensed Consolidated Financial Statements

September 30, 2020



3. Concentration

Customers

For the three months ended September 30, 2020 and 2019, our Company earned net revenues of $2,146,326 and $753,974 respectively. The vast majority of these revenues for the period ending September 30, 2020 were derived from a large number of customers, whereas the vast majority of these revenues for the period ending September 30, 2019 were derived from a limited number of customers. There was one customer that accounted for approximately 13.9% of the Company’s total revenues for the period ended September 30, 2020.

Suppliers

For the period ended September 30, 2020, we purchased products for sale by the Company’s subsidiary from several contract manufacturers located in Asia and the U.S. A substantial portion of the Company’s inventory was purchased from two (2) suppliers. The two suppliers accounted for 25.5% and 16.20%, respectively, of the Company’s total inventory purchase for the period ended September 30, 2020.

For the period ended September 30, 2019, we purchased products for sale by the company’s subsidiaries from several contract manufacturers located in Asia and the U.S. A substantial portion of the Company’s inventory is purchased from two (2) suppliers. The two (2) suppliers accounted as follows: Two suppliers accounted for 31.21% and 17.80% of the Company’s total inventory purchase for the period ended September 30, 2019, respectively.

4. Equity Transaction - Exclusive License Rights and Acquisition
During December 2017, the Company entered into a master marketing agreement with BizRight, LLC, a leading marketer and manufacturer of hydroponic growth supplies, which offers a range of hydroponics-related products including: HPS grow lights, electronic ballasts, HPS Bulbs, nutrient mixes, environmental control products, pH measurement and calibration solutions and other grow and storage products. BizRight operates the ZenHydro.com website and other e-commerce properties, and sells various products to distributors and retailers. On April 11, 2018, the same rights under the master marketing agreement were assigned to BZRTH Inc. On February 5, 2019, the Company exercised its option to acquire BZRTH and the transaction closed on October 30, 2019. On January 15, 2020, the Company entered into a Rescission and Mutual Release Agreement (“Agreement”) with each of the parties agreeing to rescind the transaction and return all consideration exchanged pursuant to the Stock Exchange Agreement.

5. VIE

On February 7, 2020, the Company entered into a share sale and purchase agreement (the “Indigo Agreement”) with Indigo Dye Group Corp. ("Indigo"), a corporation located in Sacramento, California. Indigo carries on business as a cannabis seller and delivery business under the name BudCars. The major Cannabis Products include Flower, Edibles, Vape Cartridges, Pre-Rolls, & Concentrates, etc. All the products are finished goods. In addition, Indigo is operating a non-store front retail delivery business (Type-9 License# C9-0000286) in California.

Since late May 2020, the Company has been actively involved in development of Indigo’s operations with power to direct the activities and significantly impact Indigo’s economic performance. The Company also has obligations to absorb losses and right to receive benefits from Indigo. As such, in accordance with ASC 810-10-25-38A through 25-38J, Indigo is consolidated as an VIE of the Company.




8)..Budlife patented storage.
Nothing became of the Budlife storage container..Going on 2 years..Budlife (Plantation Corp) CEO died and company seems to be at a standstill..Jimmy doesn't bother mentioning anymore.

9)..Sales of PPE
Jimmy released info of $10M in orders in May that needed to be filled...Pumped in interview that might happen in month or two..Never happened, although did report $800k+ in PPE sales..PPE product offering on popular select items have dropped significantly..If one calculates that last Q revenues totalled $2.1m...and SGMD appears to be reporting Budcars subsidiary $1.5m for that Q...and Carryoutsupplies lowest resturaunt paper goods supplies has been $416K..then that doesn't leave much, unfortunately, for last Quarterly PPE sales..Imo, PPE sales have lost their MOJO.

10)..CEO owns 373,500 shares
Jimmy owns way more than that..His personal holdings, along with his LMK holding, puts him well over 50% voting rights per filings several months (to a year) back.

11)..3.18 O/S
Otcmarkets reports as of 12/31....O/S 3.6B and A/S 10B

12)..Current pink
Correct, SGMD is pink current...but having been slapped with caveat emptor since about Oct14 is concerning that Jimmy unable to manage its removal..and Jan31 is cut-off date for another brokerage (Ameritrade) to buy caveat emptor shares..