This Annual Report on Form 10-K contains forward-looking statements that involve substantial risks and uncertainties. All statements, other than statements of historical fact, included in this report regarding our strategy, future operations, future financial position, future revenues, projected costs, prospects and plans and objectives of management are forward-looking statements. The words "anticipates," "believes," "estimates," "expects," "intends," "may," "plans," "projects," "will," "would" and similar expressions are intended to identify forward-looking statements, although not all forward-looking statements contain these identifying words.

We have based these forward-looking statements on our current expectations and projections about future events. Although we believe that the expectations underlying our forward-looking statements are reasonable, these expectations may prove to be incorrect, and all of these statements are subject to risks and uncertainties. Therefore, you should not place undue reliance on our forward-looking statements. We have included important risks and uncertainties in the cautionary statements included in this report, particularly the section titled "Risk Factors" incorporated by reference herein. We believe these risks and uncertainties could cause actual results or events to differ materially from the forward-looking statements that we make. Should one or more of these risks and uncertainties materialize, or should underlying assumptions, projections or expectations prove incorrect, actual results, performance or financial condition may vary materially and adversely from those anticipated, estimated or expected. Our forward-looking statements do not reflect the potential impact of future acquisitions, mergers, dispositions, joint ventures or investments that we may make. We do not assume any obligation to update any of the forward-looking statements contained herein, whether as a result of new information, future events or otherwise, except as required by law. In the light of these risks and uncertainties, the forward-looking events and circumstances discussed in this report may not occur, and actual results could differ materially from those anticipated or implied in the forward-looking statements.





Overview and History

We were originally incorporated in the State of Colorado in August 1998 under the name "Network Acquisitions, Inc." We changed our name to Cavion Technologies, Inc. in February 1999 and subsequently to Concord Ventures, Inc. in October 2006.

On December 21, 2000, we filed for protection under Chapter 11 of the United States Bankruptcy Code. In connection with the filing, on February 16, 2001, we sold our entire business, and all of our assets, for the benefit of our creditors. After the sale, we still had liabilities of $8.4 million and were subsequently dismissed by the Court from the Chapter 11 reorganization, effective March 13, 2001, at which time the last of our remaining directors resigned. On March 13, 2001, we had no business or other source of income, no assets, no employees or directors, outstanding liabilities of approximately $8.4 million and had terminated our duty to file reports under securities law. In February 2008, we were re-listed on the OTC Bulletin Board.

In April 2010, we re-domiciled in Delaware under the name CCVG, Inc. ("CCVG"). Effective December 31, 2010, CCVG completed an Agreement and Plan of Merger and Reorganization (the "Reorganization") which provided for the merger of two of our wholly-owned subsidiaries. As a result of this reorganization, our name was changed to "Golden Dragon Inc.", which became the surviving publicly quoted parent holding company.











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On May 9, 2014, we entered into a Share Purchase Agreement (the "Share Purchase Agreement") with CannaPharmaRX, Inc., a Colorado corporation ("Canna Colorado"), and David Cutler, a former President, Chief Executive Officer, Chief Financial Officer and director of our Company. Under the Share Purchase Agreement, Canna Colorado purchased 1,421,120 shares of our common stock from Mr. Cutler and an additional 9,000,000 restricted common shares directly from us.

On May 15, 2014, as amended and effective January 29, 2015, we entered into an Agreement and Plan of Merger (the "Merger") pursuant to which Canna Colorado became a subsidiary of our Company. In October 2014, we changed our legal name to "CannaPharmaRx, Inc."

Pursuant to the Merger, all of the shares of our Common Stock previously owned by Canna Colorado were canceled. As a result of the aforesaid transactions, we became an early-stage pharmaceutical company whose purpose was to advance cannabinoid research and discovery using proprietary formulation and drug delivery technology then under development.

In April 2016, we ceased operations. Our then management resigned their respective positions with our Company, with the exception of Mr. Gary Herick, who remained as one of our officers and directors until March 2019.

Effective December 31, 2018, the Company and Hanover CPMD Acquisition Corp. ("CPMD Hanover") a newly formed, wholly-owned subsidiary, entered into a Securities Purchase Agreement with Alternative Medical Solutions, Inc., an Ontario, Canada corporation ("AMS"), its shareholders, wherein the Company acquired all of the issued and outstanding securities of AMS. AMS is a corporation organized under the laws of the Province of Ontario, Canada. As a result of the completion of the acquisition of AMS on December 31, 2019, the Company no longer fits the definition of a "shell company," as defined in Rule 405 of the Securities Act and Rule 12b-2 of the Exchange Act. It filed the required disclosure on Form 8-K/A with the SEC on February 14, 2019, advising that it was no longer a shell company pursuant to the aforesaid Rule.

On January 6, 2021, the Company executed an Agreement of Purchase and Sale through its wholly owned subsidiary, Alternative Medical Solutions Inc for the sale of the lands and premises located at Hanover, Ontario, Canada. The price was $2,000,000 CAD and the closing of this transaction occurred on July 9, 2021. As a result, and anticipation of the closing, the Company recorded an impairment of goodwill and fixed assets relating to the property of $7,962,694 during the year ended December 31, 2020. This property is security for a $1,000,000 US note with Koze Investments, LLC by way of a first charge ranking. At closing, the note was retired with the proceeds from the sale by repayment of the principal of $1,000,000, accrued interest of $124,735, and penalties of $475,265. This note was discharged on July 13, 2021.

Effective February 25, 2019, the Company acquired 3,936,500 shares and 2,500,000 Warrants to purchase 2,500,000 shares of Common Stock of GN Ventures, Ltd, Alberta, Canada, f/k/a Great Northern Cannabis, Ltd. ("GN"), in exchange for an aggregate of 7,988,963 shares of its Common Stock, from a former shareholder of GN who is now the Company's President and CEO. While no assurances can be provided, the Company believes this is the initial step in its efforts to acquire all or a significant portion of the issued and outstanding stock of GN. In May 2020, the Company exchanged 5,507,400 of its shares for 3,671,597 shares of GN.

GN owns a 60,000 square foot cannabis cultivation and grow facility located on 38 acres in Stevensville, Ontario, Canada. Because the Company is a minority shareholder of GN and GN is a privately held company, the Company cannot confirm that the information it currently has on GN's operations is complete or fully reliable. GN estimates annual total production capacity from the Stevensville facility of up to 12,500 kilograms of cannabis. GN believes the Stevensville facility to be complete, and GN's subsidiary, 9869247 Canada Limited, received a license to cultivate from the Canadian Ministry of Health on July 5, 2019. As a result, in October 2019, GN commenced cultivation activities and began generating revenues during the first calendar quarter of 2020. The Company expects that it will obtain additional information on the business activities of GN as it has renewed discussions to acquire additional interests and is performing its due diligence procedures.











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Effective June 11, 2019, the Company entered into a Securities Purchase Agreement with Sunniva, Inc, a British Columbia, Canada corporation ("Sunniva") wherein the Company agreed to acquire all of the issued and outstanding securities of Sunniva's wholly-owned subsidiaries Sunniva Medical Inc. ("SMI") and 1167025 B.C. LTD ("1167025") for CAD $16.0 million in cash and a note in the principal amount of CAD $4.0 million. These companies are the current owners of the Sunniva Canada Campus, which includes construction assets for a planned 759,000 square-foot greenhouse located on an approximately 114-acre property in Okanagan Falls, British Columbia.

On June 8, 2020, the Company received a notice of termination of this Purchase Agreement, as amended, from Sunniva. As a result, the Company incurred a charge of $1,881,126 due to the write-off of its deposit to Sunniva, banking fees and prepaid expenses associated with the failed acquisition of Sunniva. The Company is in discussions with Sunniva, as well as an investment banker who received deposits from the Company, about recovering all or a portion of its deposits, banking fees, and prepaid expenses. The accompanying financial statements as of December 31, 2021, do not reflect potential recovery amounts related to Sunniva and other parties, if any.

On January 6, 2022, the Company entered into a 20 year operating lease with Formosa Mountain Ltd., for a cannabis production facility in Cremona, Alberta, Canada. The facility is a 55,000 square foot plant, built in 2015. The licencing process is currently underway and production and sales are anticipated in Q3 of 2022.

Our principal place of business is located at 3600 888-3rd Street SW, Calgary, Alberta, Canada, phone 949-652-6838. Our website address is www.cannapharmarx.com.

Because we have not generated any revenues during our prior two years, the following is our Plan of Operation.





PLAN OF OPERATION

See "Part 1, Item 1, Business," above for a detailed discussion of our current business activities and plan of operation, the contents of which are incorporated herein as if set forth.





Recent Funding

Between January 1, 2021 and December 30, 2021 the Company issued $584,333.33 new convertible debentures to accredited investors with 12 month terms to maturity and interest rates between 5% and 10%. As of December 31, 2021 $1,303,316 of outstanding notes have been converted into Common Shares.

During the fourth quarter, the Company entered into $103,750 of new convertible debentures to accredited investors with 12 month terms to maturity and an interest rate of 10%. These debentures are convertible at any time up after 180 days at the lowest trading price during the previous 20 trading days. Prepayment is authorized between 0 and 180 days at 115% to 135%.

For additional information, see Note 15 Subsequent Events included in Item 8. of this Form 10-K.





Going Concern

Substantial doubt exists as to our ability to continue as a going concern based on the fact that we do not have adequate working capital to finance our day-to-day operations. The Company did not have any revenues for the years ended December 31, 2021 and 2020. The Company's operating deficit of $2,993,169 as of December 31, 2021 indicates substantial uncertainty about the Company's ability to continue as a going concern. Management's plans include engaging in further research and development and raising additional capital in the short term to fund such activities through sales of its common stock. Management's ability to implement its plans and continue as a going concern may be dependent upon raising additional capital. Our continued existence depends on the success of our efforts to raise additional capital necessary to meet our obligations as they come due and to obtain sufficient capital to execute our business plan. We may obtain capital primarily through issuances of debt or equity or entering into collaborative arrangements with corporate partners. There can be no assurance that we will be successful in completing additional financing or collaboration transactions or, if financing is available, that it can be obtained on commercially reasonable terms. If we are not able to obtain the additional financing on a timely basis, we may be required to further scale down or perhaps even cease the operation of our business. The issuance of additional equity securities by us could result in a significant dilution in the equity interests of our current stockholders. Obtaining commercial loans, assuming those loans would be available, will increase our liabilities and future cash commitments. Our financial statements do not include adjustments that might result from the outcome of this uncertainty.











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Results of Operations

The Company does not currently sell or market any products and did not have any sales in the fiscal years ended December 31, 2021 or 2020. The Company will commence actively marketing products after the products have been cleared or approved by Health Canada, but there can be no assurance, however, that we will be successful in obtaining Health Canada clearance or approval for our products.





Costs of Goods Sold

The Company did not have sales for the fiscal years ended December 31, 2021 or 2020 and, accordingly, there were no cost of goods sold.





Gross Profit and Gross Margin

For the fiscal years ended December 31, 2021 and 2020, the Company had no gross profit or gross margin.





Operating Expenses

Our operating expenses consist primarily of general and administrative expenses, which include salaries, stock-based compensation expense and legal and professional fees associated with the costs for services or employees in finance, accounting, sales, administrative activities and the formation and compliance of a public company.

Overall operating expenses in fiscal 2021 was 2,993,169 compared to fiscal 2020 of 14,486,172, lower by $11,493,003. General and Administrative expenses are lower by $1,282,430 which included accrued expenses for management services contracts currently in dispute. Acquisition expenses were lower by $1,508,604 due to the prior year write off of Sunniva expenses. Travel and entertainment expenses were lower by $457,329 due to lower activity. Professional fees were higher by $259,797 due to investment banking fees and legal fees.Consulting fees were lower by $380,220 than the prior year due to reduced board fees. The prior year also included $7,962,694 in impairment of goodwill due to the write down of the hanover facility investment.





Other expense

Interest expense was $1,507,391 and $2,293,858 for the years ended December 31, 2021 and 2020, respectively. The decrease in interest expense in fiscal 2021 compared to fiscal 2020 was attributable to a decrease in the average outstanding balance of notes payable and the amortization of debt discounts.

Loss on extinguishment of debt during the year ended December 31, 2021 was $1,452,629 compared to a gain during the prior year of $566,408. Other income for the year ended December 31, 2021 from the settlement of the Koze note. A loss on investments during the current year of $6,672,019 due to the write down of the GN Ventures investment. Changes in the fair value of derivative liability increased by $6,845,805 over the prior year.





Net Loss

Net loss decreased $11,057,773, or 56% , in fiscal 2021 compared to fiscal 2020, primarily as a result of the decrease in operating expenses and interest expense, partially offset by the fair value of derivative liability.

LIQUIDITY AND CAPITAL RESOURCES

As of December 31, 2021, we had $27,767 in cash as compared to $334,969 at December 31, 2020.





Cash Flows



The following table sets forth the primary sources and uses of cash and cash
equivalents:



                                             Year Ended       Year Ended
                                                2021             2020

Net cash used in operating activities $ (2,414,656 ) $ (563,573 ) Net cash provided by Investing activities $ 493,623 $ - Net cash provided by financing activities $ 1,340,459 $ 824,573










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Cash flows from operating activities

The Company used $2,414,656 in operating activities during the year ended December 31, 2021, as compared to $563,573 during the prior year. During the current year, the Company had a net loss of $8,832,499, stock based compensation expense of $363,050, loss on investment in GN Ventures of $6,672,019, common stock issued in connection with advertising expense of $211,200 and financing expense of $51,010, amortization of debt discount of $1,452,629, change in the fair value of derivatives of $3,169,156, depreciation of $2,708, a decrease in prepaid expenses of $132,039, and an increase to payables and accruals of $553,026.

During the year ended December 31, 2020, the Company had a net loss of $19,890,272, stock based compensation expense of $820,379, amortization of intangible assets of $126,963, common stock issued in connection with advertising expense of $701,650 and financing of $20,003, amortization of debt discount of $2,293,858, change in the fair value of derivatives of $3,676,649, depreciation expense of $1,542, impairment of goodwill on Hanover of $7,962,694, decrease in prepaid expenses of $1,782,873, and an increase to accounts payable and accruals of $1,940,087.

Cash flows from investing activities

During the year ended December 31, 2021, cash was provided to the Company, $539,376 from the sale of the AMS land and building, offset by $6,263 from the purchase of fixed assets, and a further $39,490 invested in Klonetics. There were no funds generated from investing activities during the prior year.

Cash flows from financing activities

During the year ended December 31, 2021, the Company generated $1,340,459 from financing activities, $535,000 from the sale of Preferred stock, $530,836 from convertible loans, net of repayments, $238,560 from notes payable, net of repayments, $291,064 from the sale of Common stock in private placements, offset by $255,001 through the repayment of related party loans.

During the year ended December 31, 2020, the Company generated $824,573, with $848,000 of proceeds from convertible loans net of repayments, $11,973 from proceeds of notes payable net of repayments, offset partially by $35,400 from the repayment of related party loans.

Based on the foregoing, substantial doubt exists as to the Company's ability to continue as a going concern based on the fact that the Company does not have adequate working capital to finance its day-to-day operations. The Company did not have any revenues during the years ended December 31, 2021 and 2020. The Company's accumulated deficit of $13,589,006 as of December 31, 2021 indicates substantial uncertainty about its ability to continue as a going concern. Management's plans include raising capital through the sale of common stock and the issuance of convertible notes. Management's ability to implement its plans and continue as a going concern is directly dependent upon raising additional capital.

Currently, the Company has no committed source for any funds to allow the Company to complete any of its proposed acquisitions or projects. No representation is made that any funds will be available when needed. In the event funds cannot be raised if and when needed, the Company may not be able to carry out its business plan. The Company's inability to obtain funding for its projects will have a material negative impact on its liquidity and results of operations.





Subsequent Events

On January 3, 2022, the Company issued 1,644,231 common shares on conversion of a debenture dated June 22, 2021. Principal of $8,750 plus $1,937.50 interest for a total of $10,687.50 at $0.0065.

On January 4, 2022, the Company issued 6,247,127 common shares on partial conversion of a debenture dated May 10, 2021. $62,941.27 at $0.01.

On January 5, 2022, the Company entered into a convertible debenture with an accredited investor in the amount of $50,000. This debenture bears interest of 10% and is convertible into common shares at 61% of the lowest closing price during the previous 20 days to the date of the conversion. Prepayment of this note is authorized at 115% - 135% up to 180 days. In the event of default interest increases to 22%.

On January 6, 2022, the Company entered into a 20 year operating lease with Formosa Mountain Ltd., for a cannabis production facility in Cremona, Alberta, Canada. The facility is a 55,000 square foot, 6,000 kg per year plant, built in 2015. The licensing process is currently underway, and production and sales are anticipated in Q3 of 2022.

On January 6, 2022, the Company issued 6,001,250 common shares on conversion of 4,801 Preferred A shares at 1250 common shares for each Preferred A share (1250:1).









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On January 7, 2022 the Company sold 2,500,000 common shares to an accredited investor at $0.02 for proceeds of $50,000.

On January 13, 2022, the Company issued 2,110,615 common shares on partial conversion of a debenture dated April 22, 2021. Principal of $12,500 plus $443.49 interest plus fees of $575 for a total of $13,518.49 at $0.006405.

On February 4, 2022, the Company entered into a promissory note with an accredited investor in the amount of $50,000. This note bears interest of 12% and matures July 2, 2022.

On February 8, 2022, the Company issued 2,261,405 on final conversion of a debenture dated April 22, 2021. Principal of $17,500 plus interest of $685.62 plus fees of $575 for a total of $18,760.62 at $0.008296.

On February 11, 2022, the Company entered into a convertible debenture with an accredited investor in the amount of $63,750. This debenture bears interest of 10% and is convertible into common shares at 61% of the lowest closing price during the previous 20 days to the date of the conversion. Prepayment of this note is authorized at 115% - 135% up to 180 days. In the event of default interest increases to 22%.

On March 1, 2022, the Company issued 4,843,750 common shares for the conversion of a convertible debenture dated August 26, 2021. Principal of $38,750 plus $1,937.50 interest for a total of $40,687.50 at $0.0084.

Between February 14, 2022 and March 28,2022, 11,032,613 common share were issued for the conversion of a convertible debenture dated May 10, 2022, $110,326.13 @ $0.01 per share. These shares and amount are related to a dispute between the parties that is currently under review.

On March 11, 2022, the Company entered into a new $312,500 convertible debenture with an accredited investor for net proceeds of $182,977. This debenture matures December 11, 2022 and bears interest of 24%, has an OID of $62,500, and is convertible into common shares at the lowest trading price over 60 days prior to conversion date. 1,000,000 common shares have been issued as commitment shares to the holder and the broker for this issuance. $62,500 of interest has been prepaid on this note.

On March 30, 2022, the Company issued 5,262,500 common shares on conversion of 4,210 Preferred A shares at 1250 common shares for each Preferred A share (1250:1).

Critical Accounting Policies and Estimates





Critical Accounting Estimates

Our financial statements and accompanying notes have been prepared in accordance with U.S. GAAP. The preparation of these financial statements requires management to make estimates, judgments, and assumptions that affect reported amounts of assets, liabilities, revenues and expenses. We continually evaluate the accounting policies and estimates used to prepare the financial statements. The estimates are based on historical experience and assumptions believed to be reasonable under current facts and circumstances. Actual amounts and results could differ from these estimates made by management.

RECENTLY ISSUED ACCOUNTING PRONOUNCEMENTS

Management has reviewed all other recently issued, but not yet effective, accounting pronouncements and do not believe the future adoption of any such pronouncements may be expected to cause a material impact on our financial condition or the results of our operations.

Off-Balance Sheet Arrangements

We have not entered into any off-balance sheet arrangements that have or are reasonably likely to have a current or future effect on our financial condition, changes in financial condition, revenues or expenses, results of operations, liquidity, capital expenditures or capital resources and would be considered material to investors.







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