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    Forma 10-Q Gaucho Group Holdings, para: 30 de junio
    Tipo de Cambio de Divisas

    Forma 10-Q Gaucho Group Holdings, para: 30 de junio

    usdgbp_lwn506By usdgbp_lwn506agosto 20, 2020No hay comentarios92 Mins Read
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    UNIDO
    ESTADOS

    VALORES
    Y COMISIÓN DE CAMBIO

    Washington,
    D. C. 20549

    FORMAR
    10-Q

    (X)
    INFORME TRIMESTRAL DE CONFORMIDAD CON LA SECCIÓN 13 O 15 (d) DE LA LEY DE CAMBIO DE VALORES DE 1934

    por
    el período trimestral terminado el 30 de junio de 2020

    O

    () INFORME DE TRANSICIÓN BAJO LA SECCIÓN 13 O 15 (d) DE LA LEY DE CAMBIO DE VALORES DE 1934

    por
    el período de transición de _____________ a ___________________.

    Comisión
    número de archivo: 000-55209

    Gaucho
    Group Holdings, Inc.

    (Exacto
    nombre del registrante como se especifica en su estatuto)

    Delaware 52-2158952
    (Estado
    u otra jurisdicción de
    (I.R.S.
    Empleador
    incorporación
    u organización)
    Identificación
    No.)

    8
    Union Square 2A

    Nuevo
    York, NY 10003

    (Habla a
    de las principales oficinas ejecutivas)

    212-739-7700

    (Registrante
    número de teléfono, incluido el código de área)

    Valores
    registrado de conformidad con la Sección 12 (b) de la Ley:

    Título
    de cada clase
    Comercio
    Símbolo
    Nombre
    de cada intercambio en el que se registró
    N / A N / A N / A

    Indicar
    con una marca de verificación si el registrante (1) ha presentado todos los informes requeridos por la Sección 13 o 15 (d) de la Bolsa de Valores
    Ley de 1934 durante los 12 meses anteriores (o por un período más corto en el que se requirió que el registrante presentara dichos informes),
    y (2) ha estado sujeto a dichos requisitos de presentación durante los últimos 90 días. Si (X) No ()

    Indicar
    con una marca de verificación si el solicitante de registro ha presentado electrónicamente todos los archivos de datos interactivos que deben presentarse de conformidad con la Regla 405 de la Regulación S-T (§232.405 de este Capítulo) durante los 12 meses anteriores (o por un período más corto
    que el solicitante de registro estaba obligado a enviar dichos archivos). Si (X) No ()

    Indicar
    Marque si el registrante es un contribuyente acelerado grande, un declarante acelerado, un declarante no acelerado o un contribuyente más pequeño.
    empresa de informes. Consulte las definiciones de "archivador acelerado grande", "archivador acelerado" y
    compañía informante ”en la Regla 12b-2 de la Ley de Bolsa.

    Grande
    archivador acelerado
    () Acelerado
    archivador
    ()
    No acelerado
    archivador
    (X) Menor
    empresa de informes
    (X)
    Emergente
    empresa en crecimiento
    (X)

    Si
    una empresa en crecimiento emergente, indique con una marca de verificación si el registrante ha optado por no utilizar el
    Cumplir con cualquier estándar de contabilidad financiera nuevo o revisado provisto de conformidad con la Sección 13 (a) de la Exchange Act. ()

    Indicar
    con una marca de verificación si el registrante es una empresa fantasma (como se define en la Regla 12b-2 de la Exchange Act). Si () No (X)

    Como
    del 18 de agosto de 2020, había 60,271,082 acciones ordinarias en circulación.

    GAUCHO
    GROUP HOLDINGS, INC. Y SUBSIDIARIAS

    MESA
    DE CONTENIDO

    PARTE
    I INFORMACION FINANCIERA

    Articulo
    1. Estados financieros

    GAUCHO
    GROUP HOLDINGS, INC. Y SUBSIDIARIAS

    CONDENSADO
    BALANCE DE SITUACIÓN CONSOLIDADOS

    30 de Junio, 31 de diciembre,
    2020 2019
    (no auditado)
    Bienes
    Activos circulantes
    Efectivo y equivalentes de efectivo PS 150,710 PS 40,378
    Cuentas por cobrar, neto de reserva de $ 142,365 y $ 126,216 al 30 de junio de 2020 y al 31 de diciembre de 2019, respectivamente 352,272 335,622
    Cuentas por cobrar – partes relacionadas, neto de reserva de $ 451,680 y $ 514,087 al 30 de junio de 2020 y al 31 de diciembre de 2019, respectivamente 40,257 39,837
    Anticipos a empleados 281,783 281,783
    Inventario 1,006,590 1,163,260
    Lotes inmobiliarios en venta 139.492 139.492
    Activo por derecho de uso de arrendamiento operativo – 148.581
    Inversión 63,376 74,485
    Gastos pagados por adelantado y otros activos circulantes 212,627 205.309
    Total de activos corrientes 2,247,107 2,428,747
    Activos a largo plazo
    Propiedad y equipo, neto 2.839.415 2,914,715
    Impuestos extranjeros pagados por adelantado, neto 493,887 474,130
    Inversiones – partes relacionadas 3.918 3.470
    Depósitos 38,014 99,298
    Los activos totales PS 5,622,341 PS 5.920.360

    los
    las notas adjuntas son parte integral de estos estados financieros condensados ​​consolidados.

    GAUCHO
    GROUP HOLDINGS, INC. Y SUBSIDIARIAS

    CONDENSADO
    BALANCES CONSOLIDADOS (CONTINUACIÓN)

    30 de Junio, 31 de diciembre,
    2020 2019
    (no auditado)
    Pasivos, patrimonio temporal y carencia de accionistas
    Pasivo circulante
    Cuentas por pagar PS 867,584 PS 823,762
    Gastos acumulados, porción corriente 1.427.630 1.122.345
    Ingresos diferidos 884,515 899,920
    Pasivos por arrendamiento operativo – 157,826
    Préstamos por pagar, porción corriente, neto de descuento de deuda 749,757 781,719
    Préstamos por pagar – partes relacionadas 707,529 566,132
    Obligaciones de deuda 1,270,354 1,270,354
    Obligaciones de deuda convertible 1.358.420 –
    Depósitos de inversores 29,950 29,950
    Otros pasivos corrientes 117.186 85,945
    Total pasivos corrientes 7.412.925 5.737.953
    Pasivos a largo plazo
    Gastos acumulados, porción no corriente 17.196 86,398
    Préstamos por pagar, porción no corriente, neto de descuento de deuda 385,744 96.583
    Responsabilidad total 7.815.865 5.920.934
    Compromisos y contingencias
    Acciones preferentes canjeables convertibles Serie B, valor nominal $ 0.01 por acción; 902,670 acciones autorizadas; 901,070 y 902,670 emitidos y en circulación al 30 de junio de 2020 y 31 de diciembre de 2019, respectivamente. Preferencia de liquidación de $ 10,719,820 al 30 de junio de 2020. 9.010.824 9.026.824
    Deficiencia de accionistas
    Acciones preferentes, 11.000.000 de acciones autorizadas:
    Acciones preferentes convertibles Serie A, valor nominal $ 0.01 por acción; 10.097.330 acciones autorizadas; no hay acciones disponibles para su emisión. – –
    Acciones comunes, valor nominal $ 0.01 por acción; 80.000.000 de acciones autorizadas; 60,321,615 acciones emitidas y 60,271,082 acciones en circulación al 30 de junio de 2020 y 31 de diciembre de 2019. 603,215 603,215
    Pago adicional en capital 90,881,774 90,675,518
    Otra pérdida integral acumulada (11,981,310 ) (12,399,833 )
    Déficit acumulado (90.592.519 ) (87,886,307 )
    Autocartera, al costo, 50.533 acciones al 30 de junio de 2020 y 31 de diciembre de 2019 (46.355 ) (46.355 )
    Deficiencia de los accionistas de Total Gaucho Group Holdings, Inc. (11,135,195 ) (9.053.762 )
    Interes no controlado (69,153 ) 26,364
    Deficiencia total de los accionistas (11,204,348 ) (9.027.398 )
    Pasivo total, capital temporal y deficiencia de los accionistas PS 5,622,341 PS 5.920.360

    los
    las notas adjuntas son parte integral de estos estados financieros condensados ​​consolidados.

    GAUCHO
    GROUP HOLDINGS, INC. Y SUBSIDIARIAS

    CONDENSADO
    ESTADOS DE OPERACIONES CONSOLIDADOS

    (no auditado)

    por
    los tres meses terminaron
    por
    los seis meses terminaron
    junio
    30,
    junio
    30,
    2020 2019 2020 2019
    Ventas PS 117,332 PS 268,733 PS 414,318 PS 709,228
    Costo
    de ventas
    (241,205 ) (401,498 ) (490,626 ) (630,108 )
    Beneficio bruto (123.873 ) (132.765 ) (76.308 ) 79,120
    Los gastos de explotación
    Venta y marketing 12,106 125,369 49,999 236,807
    General y administrativo 1.253.038 1,551,710 2,482,273 2,929,434
    Depreciación
    y amortización
    46,342 62.579 92,503 112,159
    Total
    los gastos de explotación
    1,311,486 1,739,658 2,624,775 3,278,400
    Pérdida de operaciones (1.435.359 ) (1.872.423 ) (2.701.083 ) (3,199,280 )
    Otros gastos (ingresos)
    Gastos por intereses,
    red
    90,903 105,406 121,136 227.029
    Ganancias
    de transacciones en moneda extranjera
    (20,025 ) 15.189 (20.490 ) (32,334 )
    Total
    otro gasto
    70,878 120.595 100,646 194,695
    Pérdida neta (1,506,237 ) (1.993.018 ) (2.801.729 ) (3.393.975 )
    Pérdida neta atribuible a la participación no controladora 52,872 46,409 95,517 46,409
    Se prefiere la Serie B
    dividendos en acciones
    (182,353 ) (179.770 ) (362,123 ) (357,565 )
    Pérdida neta atribuible
    a los accionistas comunes
    PS (1.635.718 ) PS (2.126.379 ) PS (3,068,335 ) PS (3.705.131 )
    Pérdida neta por
    Acción común
    PS (0,03 ) PS (0,04 ) PS (0,05 ) PS (0,07 )
    Número promedio ponderado de acciones ordinarias
    Excepcional:
    Básico
    y diluido
    60,271,082 52,276,732 60,271,082 50,123,454

    los
    las notas adjuntas son parte integral de estos estados financieros condensados ​​consolidados.

    GAUCHO
    GROUP HOLDINGS, INC. Y SUBSIDIARIAS

    CONDENSADO
    ESTADOS CONSOLIDADOS DE PÉRDIDA INTEGRAL

    (no auditado)

    por
    los tres meses terminaron
    por
    los seis meses terminaron
    junio
    30,
    junio
    30,
    2020 2019 2020 2019
    Pérdida neta PS (1,506,237 ) PS (1.993.018 ) PS (2.801.729 ) PS (3.393.975 )
    Otro resultado integral:
    Exterior
    ajustes de conversión de moneda
    290,472 357,078 418,523 365,417
    Pérdida integral (1.215.765 ) (1,635,940 ) (2,383,206 ) (3.028.558 )
    Exhaustivo
    Pérdida atribuible a participaciones no controladoras
    52,872 46,409 95,517 46,409
    Exhaustivo
    pérdida atribuible a participaciones controladoras
    PS (1,162,893 ) PS (1,589,531 ) PS (2,287,689 ) PS (2.982.149 )

    los
    las notas adjuntas son parte integral de estos estados financieros condensados ​​consolidados.

    GAUCHO
    GROUP HOLDINGS, INC. Y SUBSIDIARIAS

    CONDENSADO
    ESTADO CONSOLIDADO DE CAMBIOS EN PATRIMONIO PROVISIONAL Y DEFICIENCIA DE LOS ACCIONISTAS

    PARA
    LOS TRES Y SEIS MESES TERMINADOS EL 30 DE JUNIO DE 2020

    (no auditado)

    Serie B Gaucho
    Convertible
    Redimible
    Adicional Acumulado
    Otro
    Grupo
    Valores en cartera
    No Total
    Acciones preferentes Acciones comunes Acciones de tesorería Pagado en Exhaustivo Acumulado Accionistas controlador Accionistas
    Comparte Cantidad Comparte Cantidad Comparte Cantidad Capital Pérdida Déficit Deficiencia Interesar Deficiencia
    Balance – 1 de enero de 2020 902,670 PS 9.026.824 60,321,615 PS 603,215 50,533 PS (46.355 ) PS 90,675,518 PS (12,399,833 ) PS (87,886,307 ) PS (9.053.762 ) PS 26,364 PS (9.027.398 )
    Opciones y garantías – – – – – – 103.581 – – 103.581 – 103.581
    Pérdida integral:
    Pérdida neta – – – – – – – – (1.252.847 ) (1.252.847 ) (42.645 ) (1,295,492 )
    Otro resultado integral – – – – – – – 128,051 – 128,051 – 128,051
    Balance – 31 de marzo de 2020 902,670 9.026.824 60,321,615 603,215 50,533 (46.355 ) 90,779,099 (12.271.782 ) (89,139,154 ) (10.074.977 ) (16.281 ) (10.091.258 )
    Opciones y garantías – – – – – – 102,675 – – 102,675 – 102,675
    Recompra de acciones preferentes (1.600 ) (16.000 ) – – – – – – – – – –
    Pérdida integral:
    Pérdida neta – – – – – – – – (1,453,365 ) (1,453,365 ) (52.872 ) (1,506,237 )
    Otro resultado integral – – – – – – – 290,472 – 290,472 – 290,472
    Balance – 30 de junio de 2020 901,070 PS 9.010.824 60,321,615 PS 603,215 50,533 PS (46.355 ) PS 90,881,774 PS (11,981,310 ) PS (90.592.519 ) PS (11,135,195 ) PS (69,153 ) PS (11,204,348 )

    PARA
    LOS TRES Y SEIS MESES TERMINADOS EL 30 DE JUNIO DE 2019

    (no auditado)

    Serie B Gaucho
    Convertible
    Redimible
    Adicional Acumulado
    Otro
    Grupo
    Valores en cartera
    No Total
    Acciones preferentes Acciones comunes Acciones de tesorería Pagado en Exhaustivo Acumulado Accionistas controlador Accionistas
    Comparte Cantidad Comparte Cantidad Comparte Cantidad Capital Pérdida Déficit Deficiencia Interesar Deficiencia
    Saldo – 1 de enero de 2019 902,670 PS 9.026.824 46,738,533 PS 467,384 50,533 PS (46.355 ) PS 83,814,442 PS (13,110,219 ) PS (81,222,499 ) PS (10.097.247 ) PS – PS (10.097.247 )
    Acciones comunes emitidas en satisfacción del pasivo por participación en las utilidades 401 (k) – – 181,185 1.812 – – 61,603 – – 63.415 – 63.415
    Opciones y garantías – – – – – – 157.994 – – 157.994 – 157.994
    Acciones ordinarias emitidas en efectivo – – 2,527,857 25.279 – – 859,471 – – 884,750 – 884,750
    Pérdida integral:
    Pérdida neta – – – – – – – – (1.400.957 ) (1.400.957 ) – (1.400.957 )
    Otro resultado integral – – – – – – – 8.339 – 8,339 – 8,339
    Balance – March 31, 2019 902,670 9,026,824 49,447,575 494,475 50,533 (46,355 ) 84,893,510 (13,101,880 ) (82,623,456 ) (10,383,706 ) – (10,383,706 )
    Options and warrants – – – – – – 68,508 – – 68,508 – 68,508
    Common stock issued for cash – – 6,071,428 60,714 – – 2,064,286 – – 2,125,000 – 2,125,000
    Common stock issued upon conversion of convertible debt and interest – – 83,587 836 – – 51,824 – – 52,660 – 52,660
    Debt converted to common stock of GGI – – – – – – – – – – 2,106,608 2,106,608
    Comprehensive loss: – –
    Net loss – – – – – – – – (1,946,609 ) (1,946,609 ) (46,409 ) (1,993,018 )
    Other comprehensive income – – – – – – – 357,078 – 357,078 – 357,078
    Balance – June 30, 2019 902,670 PS 9,026,824 55,602,590 PS 556,025 50,533 PS (46,355 ) PS 87,078,128 PS (12,744,802 ) PS (84,570,065 ) PS (9,727,069 ) PS 2,060,199 PS (7,666,870 )

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

    GAUCHO
    GROUP HOLDINGS, INC. AND SUBSIDIARIES

    CONDENSED
    CONSOLIDATED STATEMENTS OF CASH FLOWS

    (unaudited)

    For the six months ended
    June 30,
    2020 2019
    Cash Flows from Operating Activities
    Net loss PS (2,801,729 ) PS (3,393,975 )
    Adjustments to reconcile net loss to net cash used in operating activities:
    Stock-based compensation:
    401(k) stock 18,433 28,844
    Options and warrants 206,256 226,502
    Gain on foreign currency translation (20,490 ) (32,334 )
    Net realized and unrealized investment losses (448 ) 1,773
    Depreciation and amortization 92,503 112,159
    Loss on disposal of asset – 410
    Amortization of right-of-use asset 92,862 107,411
    Amortization of debt discount 7,102 14,736
    Recovery of uncollectible assets (28,897 ) –
    Loss on derecognition of right-of-use asset and lease
    liabilities
    39,367 –
    Decrease (increase) in assets:
    Accounts receivable (54,914 ) (378,729 )
    Inventory 156,670 (179,889 )
    Deposits 18,451 –
    Prepaid expenses and other current assets (27,075 ) (1,480 )
    Increase (decrease) in liabilities:
    Accounts payable and accrued expenses 348,537 182,128
    Operating lease liabilities (98,641 ) (92,420 )
    Deferred revenue (15,405 ) –
    Other liabilities 31,241 (14,678 )
    Total Adjustments 765,552 (25,567 )
    Net Cash Used in Operating Activities (2,036,177 ) (3,419,542 )
    Cash Flows from Investing Activities
    Purchase of property and equipment (17,203 ) (121,519 )
    Net Cash Used in Investing Activities (17,203 ) (121,519 )
    Cash Flows from Financing Activities
    Proceeds from loans payable 27,641 –
    Proceeds from loans payable – related parties 267,397 –
    Repayments of loans payable (102,756 ) (80,235 )
    Repayments of loans payable – related parties (126,000 ) –
    Proceeds from convertible debt obligations 1,358,420 786,000
    Repayments of debt obligations – (95,500 )
    Proceeds from common stock offering – 3,009,750
    Proceeds from PPP Loan 242,487 –
    Proceeds from SBA Economic Injury Disaster Loan 94,000 –
    Repurchase of preferred stock (16,000 ) –
    Net Cash Provided by Financing
    Ocupaciones
    1,745,189 3,620,015
    Effect of Exchange Rate Changes on Cash 418,523 230,722
    Net Increase in Cash 110,332 309,676
    Cash and Cash Equivalents –
    Beginning of Period
    40,378 58,488
    Cash and Cash Equivalents –
    End of Period
    PS 150,710 PS 368,164

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

    GAUCHO
    GROUP HOLDINGS, INC. AND SUBSIDIARIES

    CONDENSED
    CONSOLIDATED STATEMENTS OF CASH FLOWS (CONTINUED)

    (unaudited)

    For the six months ended
    June 30,
    2020 2019
    Supplemental Disclosures of Cash Flow Information:
    Interest paid PS 125,561 PS 167,313
    Income taxes paid PS – PS –
    Non-Cash Investing and Financing Activity
    Accrued stock-based compensation converted to equity PS – PS 63,415
    Debt and interest payable converted to equity PS – PS 52,660

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

    GAUCHO
    GROUP HOLDINGS, INC. AND SUBSIDIARIES

    NOTES
    TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

    (unaudited)

    1.
    ORGANIZATION

    Through
    its subsidiaries, Gaucho Group Holdings, Inc. (“Company”, “GGH”), a Delaware corporation that was incorporated
    on April 5, 1999, currently invests in, develops, and operates a collection of luxury assets, including real estate development,
    fine wines, and a boutique hotel in Argentina, as well as an e-commerce platform for the sale of high-end fashion and accessories.

    Como
    wholly owned subsidiaries of GGH, InvestProperty Group, LLC (“IPG”) and Algodon Global Properties, LLC (“AGP”)
    operate as holding companies that invest in, develop and operate global real estate and other lifestyle businesses such as wine
    production and distribution, golf, tennis, and restaurants. GGH operates its properties through its ALGODON® brand. IPG and
    AGP have invested in two ALGODON® brand projects located in Argentina. The first project is Algodon Mansion, a Buenos Aires-based
    luxury boutique hotel property that opened in 2010 and is owned by the Company’s subsidiary, The Algodon – Recoleta,
    SRL (“TAR”). The second project is the redevelopment, expansion and repositioning of a Mendoza-based winery and golf
    resort property now called Algodon Wine Estates (“AWE”), the integration of adjoining wine producing properties, and
    the subdivision of a portion of this property for residential development. GGH’s wholly owned subsidiary Algodon Europe,
    Ltd., is a United Kingdom wine distribution company. GGH also holds a 79% ownership interest in its subsidiary Gaucho Group, Inc.
    (“GGI”) which began operations in 2019 for the manufacture, distribution and sale of high-end luxury fashion and accessories
    through an e-commerce platform. On March 20, 2020, the Company formed a wholly-owned subsidiary, Bacchus Collection, Inc., which
    is still in the concept stage and is not yet operational.

    2.
    GOING CONCERN AND MANAGEMENT’S LIQUIDITY PLANS

    The accompanying condensed
    consolidated financial statements have been prepared on a going concern basis, which contemplates the realization of assets and
    the satisfaction of liabilities in the normal course of business. The condensed consolidated financial statements do not include
    any adjustments relating to the recoverability and classification of asset amounts or the classification of liabilities that might
    be necessary should the Company be unable to continue as a going concern. During the six months ended June 30, 2020, the
    Company incurred a net loss of $2,801,729 and used cash in operations of $2,036,177. The Company has an accumulated
    deficit of $90,592,519 at June 30, 2020. Further, as of June 30, 2020, principal and interest in the amount of $1,270,354
    and $541,418, respectively, owed in connection with the Company’s debt obligations are past due and are payable on demand,
    principal and interest in the amount of $1,358,420 and $18,956 owed in connection with the Company’s convertible debt matures
    on December 31, 2020, and $1,466,203 represents the current portion of the Company’s loans payable which are payable
    on demand or for which payments are due within twelve months after June 30, 2020. During the six months ended June 30, 2020
    the Company funded its operations with the proceeds of debt financing of $1,989,945.

    Based upon projected revenues and expenses, the Company believes
    that it may not have sufficient funds to operate for the next twelve months from the date these financial statements are made available.
    Further, while the Company plans to apply to NASDAQ later this year to uplist its common stock, should that effort not be successful,
    the Company would be required, on December 31, 2020, to redeem all Series B Shares that have not been previously converted to common
    stock. The cost to redeem these shares would likely have a material adverse effect on the Company’s financial position and
    would likely require either the liquidation of certain Company assets or an effort to raise new equity or debt financing. Ya sea
    the Company would be able to consummate any such transaction, should it need to do so, on economically beneficial terms or otherwise,
    cannot be presently known. The aforementioned factors raise substantial doubt about the Company’s ability to continue as
    a going concern.

    GAUCHO
    GROUP HOLDINGS, INC. AND SUBSIDIARIES

    NOTES
    TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

    (unaudited)

    En
    December 2019, the 2019 novel coronavirus (“COVID-19”) surfaced in Wuhan, China. The World Health Organization declared
    the outbreak as a global pandemic in March 2020. Recently, we temporarily closed our corporate office, as well as our hotel, restaurant,
    winery operations, and golf and tennis operations. Further, the Gaucho factories have closed, borders for importing product have
    been impacted and the Gaucho fulfillment center is also closed. In response, we have reduced costs by negotiating out of our New
    York lease, renegotiating with our vendors and implementing salary reductions. We have also created an e-commerce platform for
    our wine sales in response to the pandemic. The Company is continuing to monitor the outbreak of COVID-19 and the related business
    and travel restrictions, and changes to behavior intended to reduce its spread, and the related impact on the Company’s
    operations, financial position and cash flows, as well as the impact on its employees. Due to the rapid development and fluidity
    of this situation, the magnitude and duration of the pandemic and its impact on the Company’s future operations and liquidity
    is uncertain as of the date of this report. While there could ultimately be a material impact on operations and liquidity of the
    Company, at the time of issuance, the impact could not be determined.

    los
    Company presently has enough cash on hand to sustain its operations on a month to month basis. If the Company is not able to obtain
    additional sources of capital, it may not have sufficient funds to continue to operate the business for twelve months from the
    date these financial statements are issued. Historically, the Company has been successful in raising funds to support its capital
    necesidades. Management believes that it will be successful in obtaining additional financing; however, no assurance can be provided
    that the Company will be able to do so. Further, there is no assurance that these funds will be sufficient to enable the Company
    to attain profitable operations or continue as a going concern. To the extent that the Company is unsuccessful, the Company may
    need to curtail its operations and implement a plan to extend payables, reduce overhead and possibly sell certain Company assets
    until sufficient additional capital is raised to support further operations. There can be no assurance that such a plan will be
    successful. Such a plan could have a material adverse effect on the Company’s business, financial condition and results
    of operations, and ultimately the Company could be forced to discontinue its operations, liquidate and/or seek reorganization
    in bankruptcy.

    Estas
    condensed consolidated financial statements do not include any adjustments that might result from the outcome of this uncertainty.

    3.
    SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

    Basis
    of Presentation

    The accompanying unaudited
    condensed consolidated financial statements have been prepared in accordance with accounting principles generally accepted in
    the United States of America (“GAAP”) for interim financial information. Accordingly, they do not include all of the
    information and disclosures required by accounting principles generally accepted in the United States of America for annual financial
    statements. In the opinion of management, such statements include all adjustments (consisting only of normal recurring items)
    which are considered necessary for a fair presentation of the unaudited condensed consolidated financial statements of the Company
    as of June 30, 2020, and for the three and six months ended June 30, 2020 and 2019. The results of operations for the three
    and six months ended June 30, 2020 are not necessarily indicative of the operating results for the full year. It is suggested
    that these unaudited condensed consolidated financial statements be read in conjunction with the consolidated financial statements
    and notes thereto included in the Company’s annual report on Form 10-K for the year ended December 31, 2019, filed with
    the Securities and Exchange Commission (“SEC”) on March 30, 2020. The condensed consolidated balance sheet as of December
    31, 2019 has been derived from the Company’s audited consolidated financial statements.

    Non-Controlling
    Interest

    Como
    a result of the conversion of certain convertible debt into shares of GGI common stock, GGI investors obtained a 21% ownership
    interest in GGI, which is recorded as a non-controlling interest. The profits and losses of GGI are allocated between the controlling
    interest and the non-controlling interest in the same proportions as their ownership interest. (See Note 8 – Debt Obligations)

    GAUCHO
    GROUP HOLDINGS, INC. AND SUBSIDIARIES

    NOTES
    TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

    (unaudited)

    Utilizar
    of Estimates

    A
    prepare financial statements in conformity with accounting principles generally accepted in the United States of America, the
    Company must make estimates and assumptions. These estimates and assumptions affect the reported amounts in the financial statements,
    the disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues
    and expenses during the reporting period. Actual results could differ from those estimates. The significant estimates and assumptions
    of the Company include the valuation of investments, equity and liability instruments, the value of right-of-use assets and related
    lease liabilities, the useful lives of property and equipment and reserves associated with the realizability of certain assets.

    Segment
    Información

    los
    Financial Accounting Standards Board (“FASB”) has established standards for reporting information on operating segments
    of an enterprise in interim and annual financial statements. The Company currently operates in three segments which are the (i)
    business of real estate development and manufacture, (ii) the sale of high-end fashion and accessories through an e-commerce platform
    and (iii) its corporate operations. This classification is consistent with how the Company’s chief operating decision maker
    makes decisions about resource allocation and assesses the Company’s performance.

    Highly
    Inflationary Status in Argentina

    los
    International Practices Task Force (“IPTF”) of the Center for Audit Quality discussed the inflationary status of Argentina
    at its meeting on May 16, 2018 and categorized Argentina as a country with a projected three-year cumulative inflation rate greater
    than 100%. Therefore, the Company has transitioned its Argentine operations to highly inflationary status as of July 1, 2018.

    por
    operations in highly inflationary economies, monetary asset and liabilities are translated at exchange rates in effect at the
    balance sheet date, and non-monetary assets and liabilities are translated at historical exchange rates. Under highly inflationary
    accounting, the Company’s Argentina subsidiaries’ functional currency became the United States dollar. Nonmonetary
    assets and liabilities existing on July 1, 2018 (the date that the Company adopted highly inflationary accounting) were translated
    using the Argentina Peso (“ARS”) to United States Dollar exchange rate in effect on June 30, 2018, which was 28.880.
    Since the adoption of highly inflationary accounting, activity in nonmonetary assets and liabilities is translated using historical
    exchange rates, monetary assets and liabilities are translated using the exchange rate at the balance sheet date, and income and
    expense accounts are translated at the weighted average exchange rate in effect during the period. Translation adjustments are
    reflected in income (loss) on foreign currency translation on the accompanying statements of comprehensive loss. During the three
    and six months ended June 30, 2020 the Company recorded gains on foreign currency transactions of $20,025 and $20,490, respectively,
    and during the three and six months ended June 30, 2019, respectively, the Company recorded a $(15,189) and $32,334 (loss) gain,
    respectively, on foreign currency transactions as a result of the net monetary liability position of its Argentine subsidiaries.

    Foreign
    Currency Translation

    los
    Company’s functional and reporting currency is the United States dollar. The functional currencies of the Company’s
    operating subsidiaries are their local currencies (United States dollar, Argentine peso and British pound) except for the Company’s
    Argentine subsidiaries since July 1, 2018, as described above. The assets and liabilities of Algodon Europe, LTD are translated
    from its local currency (British Pound) to the Company’s reporting currency using period end exchange rates while income
    and expense accounts were translated at the average rates in effect during the during the period. The assets, liabilities and
    income and expense accounts of the Company’s Argentine subsidiaries are translated as described above. The resulting translation
    adjustment is recorded as part of other comprehensive loss, a component of stockholders’ deficit. The Company engages in
    foreign currency denominated transactions with customers and suppliers, as well as between subsidiaries with different functional
    currencies. Gains and losses resulting from transactions denominated in non-functional currencies are recognized in earnings.

    GAUCHO
    GROUP HOLDINGS, INC. AND SUBSIDIARIES

    NOTES
    TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

    (unaudited)

    Cash
    and Cash Equivalents

    Cash
    and cash equivalents represent cash on hand, demand deposits placed with banks or other financial institutions and all highly
    liquid investments with an original maturity of three months or less as of the purchase date of such investments.

    Concentrations

    los
    Company maintains cash with major financial institutions. Cash held in US bank institutions is currently insured by the Federal
    Deposit Insurance Corporation (“FDIC”) up to $250,000 at each institution. No similar insurance or guarantee exists
    for cash held in Argentina bank accounts. There were aggregate uninsured cash balances of $20,550 and $29,027 at June 30, 2020
    and December 31, 2019, respectively, which represents cash held in Argentine bank accounts.

    Revenue
    Recognition

    los
    Company recognizes revenue in accordance with Accounting Standards Codification (“ASC”) Topic 606, Revenue from Contracts
    with Customers. ASC Topic 606 provides a single comprehensive model to use in accounting for revenue arising from contracts with
    customers, and gains and losses arising from transfers of non-financial assets including sales of property and equipment, real
    estate, and intangible assets.

    los
    Company earns revenues from the sale of real estate lots and sales of food and wine as well as hospitality, food & beverage,
    other related services, and from the sale of clothing and accessories. The Company recognizes revenue when goods or services are
    transferred to customers in an amount that reflects the consideration which it expects to receive in exchange for those goods
    or services. In determining when and how revenue is recognized from contracts with customers, the Company performs the following
    five-step analysis: (i) identification of contract with customer; (ii) determination of performance obligations; (iii)
    measurement of the transaction price; (iv) allocation of the transaction price to the performance obligations; and (v)
    recognition of revenue when (or as) the Company satisfies each performance obligation.

    los
    following table summarizes the revenue recognized in the Company’s condensed consolidated statements of operations:

    For The Three Months Ended For The Six Months Ended
    June 30, June 30,
    2020 2019 2020 2019
    Hotel rooms and events PS 3,507 PS 107,736 PS 209,762 PS 367,356
    Restaurantes 5,864 31,858 65,380 97,781
    Winemaking 20,844 12,338 21,887 102,880
    Golf, tennis and other 87,117 116,801 116,540 141,211
    Clothes and accessories – – 749 –
    Total revenues PS 117,332 PS 268,733 PS 414,318 PS 709,228

    Revenue
    from the sale of food, wine, agricultural products, clothes and accessories is recorded when the customer obtains control of the
    goods purchased. Revenues from hospitality and other services are recognized as earned at the point in time that the related service
    is rendered, and the performance obligation has been satisfied. Revenues from gift card sales are recognized when the card is
    redeemed by the customer. The Company does not recognize revenue for the portion of gift card values that is not expected to be
    redeemed (“breakage”) due to the lack of historical data. Revenue from real estate lot sales is recorded when the
    lot is deeded, and legal ownership of the lot is transferred to the customer.

    GAUCHO
    GROUP HOLDINGS, INC. AND SUBSIDIARIES

    NOTES
    TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

    (unaudited)

    los
    timing of the Company’s revenue recognition may differ from the timing of payment by its customers. A receivable is recorded
    when revenue is recognized prior to payment and the Company has an unconditional right to payment. Alternatively, when payment
    precedes the provision of the related services, the Company records deferred revenue until the performance obligations are satisfied.
    Deferred revenues associated with real estate lot sale deposits are recognized as revenues (along with any outstanding balance)
    when the lot sale closes, and the deed is provided to the purchaser. Other deferred revenues primarily consist of deposits accepted
    by the Company in connection with agreements to sell barrels of wine, advance deposits received for grapes and other agricultural
    products, and hotel deposits. Wine barrel and agricultural product advance deposits are recognized as revenues (along with any
    outstanding balance) when the product is shipped to the purchaser. Hotel deposits are recognized as revenue upon occupancy of
    rooms, or the provision of services.

    por
    the three and six months ended June 30, 2020, the Company did not recognize any revenue related to performance obligations satisfied
    in previous periods. Contracts related to the sale of wine, agricultural products and hotel services have an original expected
    length of less than one year. The Company has elected not to disclose information about remaining performance obligations pertaining
    to contracts with an original expected length of one year or less, as permitted under the guidance.

    Como
    of June 30, 2020 and December 31, 2019, the Company had deferred revenue of $841,451 and $838,471, respectively, associated with
    real estate lot sale deposits, and had $43,064 and $61,449, respectively, of deferred revenue related to hotel deposits. Ventas
    taxes and value added (“VAT”) taxes collected from customers and remitted to governmental authorities are excluded
    from revenues in the condensed consolidated statements of operations.

    Convertible
    Debt

    los
    Company evaluates for the existence of a beneficial conversion feature (“BCF”) related to the issuance of convertible
    notes, if such instruments are not deemed to be derivative financial instruments, by comparing the commitment date fair value
    to the effective conversion price of the instrument. The Company records a BCF as debt discount, which is amortized to interest
    expense over the life of the respective note using the effective interest method. BCFs that are contingent upon the occurrence
    of a future event are recognized when the contingency is resolved.

    Derivative
    Financial Instruments

    los
    Company evaluates its convertible instruments to determine if those contracts or embedded components of those contracts qualify
    as derivative financial instruments to be separately accounted for in accordance with FASB ASC 815 “Derivatives and Hedging”
    (“ASC 815”). Embedded derivatives are valued separately from the host instrument and are recognized as derivative
    liabilities in the Company’s balance sheet. Fair value accounting requires measurement of embedded derivatives at fair value.
    Changes in the fair value of derivative instruments are recognized in results of operation during the period of change.

    Sequencing
    Policy

    Under
    ASC 815, the Company has adopted a sequencing policy, whereby, in the event that reclassification of contracts from equity to
    assets or liabilities is necessary pursuant to ASC 815 due to the Company’s inability to demonstrate it has sufficient authorized
    shares as a result of certain securities with a potentially indeterminable number of shares or the Company’s total potentially
    dilutive shares exceed the Company’s authorized share limit, shares will be allocated on the basis of the earliest issuance
    date of potentially dilutive instruments, with the earliest grants receiving the first allocation of shares. Pursuant to ASC 815,
    issuances of securities granted as compensation in a share-based payment arrangement are not subject to the sequencing policy.

    GAUCHO
    GROUP HOLDINGS, INC. AND SUBSIDIARIES

    NOTES
    TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

    (unaudited)

    Net
    Loss per Common Share

    Basic
    loss per common share is computed by dividing net loss attributable to GGH common stockholders by the weighted average number
    of common shares outstanding during the period. Diluted loss per common share is computed by dividing net loss attributable to
    common stockholders by the weighted average number of common shares outstanding, plus the impact of common shares, if dilutive,
    resulting from the exercise of outstanding stock options and warrants and the conversion of convertible instruments.

    los
    following securities are excluded from the calculation of weighted average dilutive common shares because their inclusion would
    have been anti-dilutive:

    June 30,
    2020 2019
    Opciones 8,979,890 7,409,375
    Warrants 474,623 992,166
    Series B convertible preferred stock 9,010,700 9,026,700
    Convertible debt 3,443,439 (1) – (2)
    Total potentially dilutive shares 21,908,652 17,428,241

    (1)
    As of June 30, 2020, certain of the convertible notes had variable conversion prices and the potentially dilutive shares were
    estimated based on market conditions. See Note 9 – Convertible Debt Obligations.

    (2)
    As of June 30, 2019, all notes are past their maturity date and no longer convertible. See Note 8 – Debt obligations.

    Nuevo
    Accounting Pronouncements

    En
    August 2018, the FASB issued ASU 2018-13, Fair Value Measurement – Disclosure Framework (Topic 820). The updated guidance improves
    the disclosure requirements on fair value measurements. The updated guidance if effective for fiscal years, and interim periods
    within those fiscal years, beginning after December 15, 2019. Early adoption is permitted for any removed or modified disclosures.
    The Company adopted ASU 2018-13, effective January 1, 2020, which did not have a material effect on the Company’s unaudited
    condensed consolidated financial statements.

    En
    March 2020, the FASB issued ASU 2020-03, “Codification Improvements to Financial Instruments” (“ASU 2020-03”).
    ASU 2020-03 improves and clarifies various financial instruments topics. ASU 2020-03 includes seven different issues that describe
    the areas of improvement and the related amendments to GAAP, intended to make the standards easier to understand and apply by
    eliminating inconsistencies and providing clarifications. The Company adopted ASU 2020-03 upon issuance, which did not have a
    material effect on the Company’s unaudited condensed consolidated financial statements.

    GAUCHO
    GROUP HOLDINGS, INC. AND SUBSIDIARIES

    NOTES
    TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

    (unaudited)

    4.
    INVENTORY

    Inventory
    at June 30, 2020 and December 31, 2019 was comprised of the following:

    June 30, December 31,
    2020 2019
    Vineyard in process PS 94,753 PS 304,067
    Wine in process 609,954 539,380
    Finished wine 5,399 23,467
    Clothes and accessories 230,429 224,965
    Otro 66,055 71,381
    Total PS 1,006,590 PS 1,163,260

    5.
    INVESTMENTS AND FAIR VALUE OF FINANCIAL INSTRUMENTS

    Fair
    value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market
    participants at the measurement date. In determining fair value, the Company often utilizes certain assumptions that market participants
    would use in pricing the asset or liability, including assumptions about risk and/or the risks inherent in the inputs to the valuation
    technique. These inputs can be readily observable, market corroborated, or developed by the Company. The fair value hierarchy
    ranks the quality and reliability of the information used to determine fair values. Financial assets and liabilities carried at
    fair value are classified and disclosed in one of the following three categories:

    Level
    1 –
    Valued based on quoted prices at the measurement date for identical assets or liabilities trading in active markets. Financiero
    instruments in this category generally include actively traded equity securities.

    Level
    2 –
    Valued based on (a) quoted prices for similar assets or liabilities in active markets; (b) quoted prices for identical
    or similar assets or liabilities in markets that are not active; (c) inputs other than quoted prices that are observable for the
    asset or liability; or (d) from market corroborated inputs. Financial instruments in this category include certain corporate equities
    that are not actively traded or are otherwise restricted.

    Level
    3 –
    Valued based on valuation techniques in which one or more significant inputs is not readily observable. Included in this
    category are certain corporate debt instruments, certain private equity investments, and certain commitments and guarantees.

    GAUCHO
    GROUP HOLDINGS, INC. AND SUBSIDIARIES

    NOTES
    TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

    (unaudited)

    Investments
    at Fair Value:

    As of June 30, 2020 Level 1 Level 2 Level 3 Total
    Warrants – Affiliates PS – PS – PS 3,918 PS 3,918
    Government Bond 63,376 – – 63,376

    As of December 31, 2019 Level 1 Level 2 Level 3 Total
    Warrants – Affiliates PS – PS – PS 3,470 PS 3,470
    Government Bond 74,485 – – 74,485

    UNA
    reconciliation of Level 3 assets is as follows:

    Warrants –
    Affiliates
    Balance – January 1, 2020 PS 3,470
    Unrealized gain 448
    Balance – June 30, 2020 PS 3,918

    Investment
    at June 30, 2020, consisted of the Company’s investment in an Argentine government bond, purchased by the Company on December
    3, 2019. The bond had an effective interest rate of 48% per annum and matures on December 31, 2020. The decrease in the government
    bond value was a result from the effects of fluctuations in the foreign currency exchange rate during the period.

    Investment
    – related parties at June 30, 2020, consisted of retained certain affiliate warrants which are marked to market at each
    reporting date using the Black-Scholes option pricing model. The Company recorded unrealized gains (losses) on the affiliate warrants
    of $1,405 and $448 during the three and six months ended June 30, 2020, respectively, and $(1,066) and $(1,773) during the three
    and six months ended June 30, 2019, respectively, which are included in revenues on the accompanying unaudited condensed consolidated
    statements of operations.

    los
    fair value of the Company’s derivative liabilities as of June 30, 2020 was de minimis (see Note 9 – Convertible Debt
    Obligations).

    6.
    ACCRUED EXPENSES

    Accrued
    expenses were comprised of the following as of:

    June 30, December 31,
    2020 2019
    Accrued compensation and payroll taxes PS 325,217 PS 210,900
    Accrued taxes payable – Argentina 291,913 170,873
    Accrued interest 560,374 484,026
    Other accrued expenses 250,126 256,546
    Accrued expenses, current 1,427,630 1,122,345
    Accrued payroll tax obligations, non-current 17,196 86,398
    Total accrued expenses PS 1,444,826 PS 1,208,743

    GAUCHO
    GROUP HOLDINGS, INC. AND SUBSIDIARIES

    NOTES
    TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

    (unaudited)

    7.
    LOANS PAYABLE

    los
    Company’s loans payable are summarized below:

    June 30, 2020 December 31, 2019
    Gross
    Principal
    Amount
    Debt
    Discount
    Préstamos
    Payable,
    Net of Debt
    Discount
    Gross
    Principal
    Amount
    Debt
    Discount
    Préstamos
    Payable,
    Net of Debt
    Discount
    PPP Loan PS 242,487 PS – PS 242,487 PS – PS – PS –
    EIDL 94,000 – 94,000 – – –
    2020 Demand Loan 17,614 – 17,614 – – –
    2018 Demand Loan – – – 6,678 – 6,678
    2018 Loan 310,149 – 310,149 352,395 – 352,395
    2017 Loan 21,411 – 21,411 67,491 – 67,491
    Land Loan 459,500 (9,660 ) 449,840 468,500 (16,762 ) 451,738
    Total Loans Payable 1,145,161 (9,660 ) 1,135,501 895,064 (16,762 ) 878,302
    Less: current portion 758,674 (8,917 ) 749,757 795,064 (13,345 ) 781,719
    Loans Payable, non-current PS 386,487 PS (743 ) PS 385,744 PS 100,000 PS (3,417 ) PS 96,583

    En
    March 1, 2020, the Company received a loan in the amount of $27,641 (ARS $1,777,778) (the” 2020 Demand Loan”) which
    bears interest at 10% per month and is due upon demand of the lender (the “Demand Loan”). Interest is paid monthly.

    During
    the six months ended June 30, 2020, the Company made principal payments on loans payable in the aggregate of $102,756, of which
    $7,940 was paid on the 2020 Demand Loan, $5,906 was paid on the 2018 Demand Loan, $42,246 was paid on the 2018 Loan, $37,664
    was paid on the 2017 Loan and $9,000 was paid on the Land Loan. The remaining decrease in principal balances are the result of
    the impact of the change in exchange rates during the period.

    los
    Company incurred interest expense related to the loans payable in the amount of $16,087 and $38,707 during the three and six months
    ended June 30, 2020, respectively, of which $3,777 and $7,102, respectively represented amortization of debt discount, and incurred
    interest expense of $32,006 and $72,828 during the three and six months ended June 30, 2019, respectively, of which $8,241 and
    $14,736, respectively represented amortization of debt discount.

    PPP
    Loan

    En
    May 6, 2020, the Company entered into a potentially forgivable loan from the U.S. Small Business Administration (“SBA”)
    pursuant to the Paycheck Protection Program (“PPP”) enacted by Congress under the Coronavirus Aid, Relief, and Economic
    Security Act (15 U.S.C. 636(a)(36)) (the “CARES Act”), resulting in net proceeds of $242,487 (the “PPP Loan”).
    To facilitate the PPP Loan, the Company entered into a note payable agreement with Santander Bank, N.A. as the lender.

    GAUCHO
    GROUP HOLDINGS, INC. AND SUBSIDIARIES

    NOTES
    TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

    (unaudited)

    Under
    the terms of the CARES Act, as amended by the Paycheck Protection Program Flexibility Act of 2020, the Company is eligible to
    apply for and receive forgiveness for all or a portion of their respective PPP Loan. Such forgiveness will be determined, subject
    to limitations, based on the use of the loan proceeds for certain permissible purposes as set forth in the PPP, including, but
    not limited to, payroll costs (as defined under the PPP) and mortgage interest, rent or utility costs (collectively, “Qualifying
    Expenses”) incurred during the 24 weeks subsequent to funding, and on the maintenance of employee and compensation levels,
    as defined, following the funding of the PPP Loan. The Company intends to use the proceeds of the PPP Loan for Qualifying Expenses.
    However, no assurance is provided that the Company will be able to obtain forgiveness of the PPP Loan in whole or in part. Alguna
    amounts that are not forgiven incur interest at 1.0% per annum and monthly repayments of principal and interest are deferred for
    six months after the date of disbursement. While the PPP Loan currently has a two-year maturity, the amended law permits the borrower
    to request a five-year maturity from its lender.

    SBA
    Economic Injury Disaster Loans

    En
    May 22, 2020, the Company received a loan in the principal amount of $94,000 (the “EIDL Loan”) pursuant to the Economic
    Injury Disaster Loan (“EIDL”) assistance program offered by the SBA in response to the impact of the COVID-19 pandemic
    on the Company’s business. The EIDL Loan bears interest at 3.75% per annum and matures on May 22, 2050. Proceeds from the
    EIDL are being used for working capital purposes. Monthly installment payments of $459, including principal and interest, are
    due monthly beginning May 22, 2021. The EIDL Loan is secured by a security interest in all of the Company’s assets.

    8.
    DEBT OBLIGATIONS

    los
    Company’s debt obligations are summarized below:

    June 30, 2020 December 31, 2019
    Principal Interest (1) Total Principal Interest (1) Total
    2010 Debt Obligations PS – PS 317,715 PS 317,715 PS – PS 305,294 PS 305,294
    2017 Notes 1,170,354 213,957 1,384,311 1,170,354 167,341 1,337,695
    Gaucho Notes 100,000 9,746 109,746 100,000 6,260 106,260
    Total Debt Obligations PS 1,270,354 PS 541,418 PS 1,811,772 PS 1,270,354 PS 478,895 PS 1,749,249

    (1)
    Accrued interest is included as a component of accrued expenses on the accompanying condensed consolidated balance sheets.

    Cada
    of the debt obligations listed above are past due and are payable on demand. The Company incurred interest expense of $31,261
    and $62,523 in connection with its debt obligations during the three and six months ended June 30, 2020, respectively, and incurred
    interest expense of $35,986 and $104,003 in connection with its debt obligations during the three and six months ended June 30,
    2019, respectively.

    GAUCHO
    GROUP HOLDINGS, INC. AND SUBSIDIARIES

    NOTES
    TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

    (unaudited)

    9.
    CONVERTIBLE DEBT OBLIGATIONS

    los
    Company’s convertible debt obligations are summarized below:

    June 30, 2020 December 31, 2019
    Principal Interest (1) Total Principal Interest (1) Total
    Convertible Notes PS 1,358,420 PS 18,956 PS 1,377,376 PS – PS – PS –
    Total Convertible Debt Obligations PS 1,358,420 PS 18,956 PS 1,377,376 PS – PS – PS –

    (1)
    Accrued interest is included as a component of accrued expenses on the accompanying condensed consolidated balance sheets.

    During
    the six months ended June 30, 2020, the Company sold unsecured convertible promissory notes (“Convertible Notes”)
    in an aggregate amount of $1,358,420 to accredited investors who are all stockholders of the Company. The Convertible Notes mature
    on December 31, 2020 and bear interest at 7% per annum. Principal and interest outstanding under the Convertible Notes are convertible
    (i) automatically upon the closing of a firm commitment underwritten public offering registered pursuant to the Securities Act
    of 1933, as amended (a “Public Offering”, at a conversion price equal to 85% of the price per share of the Company’s
    common stock sold in the Public Offering (the “Mandatory Conversion Option”), or (ii) at the option of the holder
    at any time prior to the Public Offering at a conversion price equal to the closing price of the Company’s common stock
    on the day prior to conversion (the “Holder’s Conversion Option”). The Company incurred total interest expense
    of $15,595 and $18,956 related to this debt during the three and six months ended June 30, 2020, respectively.

    los
    Company determined that the Holder’s Conversion Option represented a variable conversion feature with no floor. Accordingly,
    the Company has adopted a sequencing policy in accordance with ASC 815-40-35-12 whereby the Holder’s Conversion Option and
    all future instruments may be classified as a derivative liability with the exception of instruments related to share-based compensation
    issued to employees or directors.

    Como
    of June 30, 2020, the value of Holders’ Conversion Option was de minimis. The contingently adjustable, non-bifurcated beneficial
    conversion feature associated with the Mandatory Conversion Option of the Convertible Notes will be accounted for, if necessary,
    at the time the contingency is resolved upon the occurrence of the Public Offering.

    10.
    RELATED PARTY TRANSACTIONS

    Assets

    Cuentas
    receivable – related parties in the amount of $40,257 and $39,837 at June 30, 2020 and December 31, 2019, represented the
    net realizable value of advances made to separate entities under common management.

    Ver
    Note 5 – Investments and Fair Value of Financial Instruments, for a discussion of the Company’s investment in warrants
    of a separate entity under common management.

    Expense
    Sharing

    En
    April 1, 2010, the Company entered into an agreement with a Related Party to share expenses such as office space, support staff
    and other operating expenses (the “Related Party ESA”). The agreement was amended on January 1, 2017 to reflect the
    current use of personnel, office space, professional services. During the three and six months ended June 30, 2020, the Company
    recorded a contra-expense of $203,941 and $343,857, respectively, and during the three and six months ended June 30, 2019, the
    Company recorded a contra-expense of $117,968 and $189,889, respectively, related to the reimbursement of general and administrative
    expenses as a result of the agreement.

    GAUCHO
    GROUP HOLDINGS, INC. AND SUBSIDIARIES

    NOTES
    TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

    (unaudited)

    During
    2019, the Related Party prepaid approximately $566,132 of its future obligations under the Related Party ESA, in exchange for
    a 15% reduction in the Related Party’s expense obligations under the Related Party ESA until the prepayment has been reduced
    to $0. During the six months ended June 30, 2020, the Related Party prepaid an additional $267,397 of its future obligations
    under the Related Party ESA. The Company repaid $126,000 of the amounts owed to the Related Party during the second quarter
    of 2020. The prepaid balance of $707,529 as of June 30, 2020, is reflected as loans payable – related parties
    on the accompanying condensed consolidated balance sheet.

    los
    Company had an expense sharing agreement with a different related entity to share expenses such as office space and other clerical
    services which was terminated in August 2017. The owners of more than 5% of that entity include (i) GGH’s chairman, and
    (ii) a more than 5% owner of GGH. The entity owed $396,116 to the Company under the expense sharing agreement at December 31,
    2019, of which the entire balance was deemed unrecoverable and reserved. During the six months ended June 30, 2020, the
    Company received payments from the entity in the amount of $62,406 and recorded recovery of the bad debt allowance
    of $62,406. The balance owed to the Company under this expense sharing agreement as of June 30, 2020 is $333,710 of which the
    entire balance is deemed unrecoverable and is reserved.

    11.
    BENEFIT CONTRIBUTION PLAN

    los
    Company sponsors a 401(k) profit-sharing plan (“401(k) Plan”) that covers substantially all of its employees in the
    United States. The 401(k) Plan provides for a discretionary annual contribution, which is allocated in proportion to compensation.
    In addition, each participant may elect to contribute to the 401(k) Plan by way of a salary deduction.

    UNA
    participant is always fully vested in their account, including the Company’s contribution. For the three and six months
    ended June 30, 2020, the Company recorded a charge associated with its contribution of $9,925 and $18,433 respectively, and for
    the three and six months ended June 30, 2019, the Company recorded a charge associated with its contribution of $15,531 and $28,844,
    respectively. This charge has been included as a component of general and administrative expenses in the accompanying condensed
    consolidated statements of operations. The Company issues shares of its common stock to settle these obligations based on the
    fair market value of its common stock on the date the shares are issued (shares were issued at $0.35 per share during 2019). Como
    of June 30, 2020, shares have not yet been issued in satisfaction of the previous year’s 401(k) obligation.

    12.
    TEMPORARY EQUITY AND STOCKHOLDERS’ DEFICIENCY

    Serie
    B Preferred Stock

    En
    March 29, 2020, the Company’s Board of Directors as well as the holders of the Series B Convertible Preferred Stock approved
    an Amendment to the Certificate of Designation of the Series B Convertible Preferred Stock (the “Third Amendment”)
    which extends the period in which holders of the Series B Shares may voluntarily elect to convert such shares into shares of common
    stock of the Company to December 31, 2020. In addition, the Series B Amendment extends the date upon which the Company shall redeem
    all then-outstanding Series B Shares and all unpaid accrued and accumulated dividends to December 31, 2020.

    En
    February 18, 2020, GGH repurchased 1,600 shares of the Series B Preferred Stock from a shareholder at $10 per share and paid accrued
    dividends of $2,451.

    los
    Series B stockholders are entitled to cumulative cash dividends at an annual rate of 8% of the Series B liquidation value (equal
    to face value of $10 per share), as defined, payable when, as and if declared by the Board of Directors. Dividends earned by the
    Series B stockholders were $182,360 and $361,987 for the three and six months ended June 30, 2020, respectively, and were $179,770
    and $357,565 for the three and six months ended June 30, 2019, respectively. Dividends payable of $82,772 are included in the
    current portion of other liabilities at June 30, 2020. Cumulative unpaid and undeclared dividends in arrears related to the Series
    B totaled $1,626,348 and $1,264,361 as of June 30, 2020 and December 31, 2019, respectively.

    GAUCHO
    GROUP HOLDINGS, INC. AND SUBSIDIARIES

    NOTES
    TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

    (unaudited)

    Accumulated
    Other Comprehensive Income

    por
    three and six months ended June 30, 2020, the Company recorded $290,472 and $418,523, respectively, of foreign currency
    translation adjustments as accumulated other comprehensive income, and for the three and six months ended June 30, 2019, the Company
    recorded benefits of $357,078 and $365,417, respectively, primarily related to fluctuations in the Argentine peso to United States
    dollar exchange rates (see Note 3 – Summary of Significant Accounting Policies, Highly Inflationary Status in Argentina).

    Warrants

    UNA
    summary of warrants activity during the six months ended June 30, 2020 is presented below:

    Number of
    Warrants
    Weighted
    Average
    Exercise
    Precio
    Weighted
    Average
    Remaining
    Life in
    Años
    Intrinsic
    Valor
    Outstanding, January 1, 2020 566,742 PS 2.11
    Issued – –
    Exercised – –
    Cancelled – –
    Expired (92,119 ) 1.38
    Outstanding, June 30, 2020 474,623 PS 2.13 0.9 PS –
    Exercisable, June 30, 2020 474,623 PS 2.13 0.9 PS –

    UNA
    summary of outstanding and exercisable warrants as of June 30, 2020 is presented below:

    Warrants Outstanding Warrants Exercisable
    Exercise Price Exercisable Into Outstanding
    Number of
    Warrants
    Weighted
    Average
    Remaining Life
    in Years
    Exercisable
    Number of
    Warrants
    PS 2.00 Common Stock 348,332 1.0 348,332
    PS 2.50 Common Stock 126,291 0.7 126,291
    Total 474,623 474,623

    Stock
    Opciones

    During
    the three and six months ended June 30, 2020, the Company recorded stock-based compensation expense of $102,675 and $206,256,
    respectively, and during the three and six months ended June 30, 2019, the Company recorded stock-based compensation expense of
    $68,508 and $226,502, respectively related to the amortization of stock option grants, and which is reflected in general and administrative
    expenses in the accompanying condensed consolidated statements of operations. As of June 30, 2020, there was $861,664 of unrecognized
    stock-based compensation expense related to stock option grants that will be amortized over a weighted average period of 2.27
    años.

    GAUCHO
    GROUP HOLDINGS, INC. AND SUBSIDIARIES

    NOTES
    TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

    (unaudited)

    UNA
    summary of GGH stock options activity during the six months ended June 30, 2020 is presented below:

    Number of
    Opciones
    Weighted
    Average
    Exercise Price
    Weighted
    Average
    Remaining
    Life in Years
    Intrinsic
    Valor
    Outstanding, January 1, 2020 9,550,640 PS 0.78
    Granted – –
    Exercised – –
    Expired (570,750 ) 2.18
    Forfeited – –
    Outstanding, June 30, 2020 8,979,890 PS 0.69 3.2 PS 66,598
    Exercisable, June 30, 2020 3,142,546 PS 1.06 2.5 PS 6,094

    los
    following table presents information related to GGH stock options at June 30, 2020:

    Options Outstanding Options Exercisable
    Exercise
    Precio
    Outstanding
    Number of
    Opciones
    Weighted
    Average
    Remaining
    Life in Years
    Exercisable
    Number of
    Opciones
    PS 0.385 4,439,890 3.6 406,251
    PS 0.539 1,500,000 3.2 656,259
    PS 0.770 1,320,000 2.6 742,506
    PS 1.100 1,020,000 2.4 637,530
    PS 2.200 700,000 1.2 700,000
    8,979,890 2.5 3,142,546

    Gaucho
    Group, Inc. Stock Options

    Como
    of June 30, 2020, options to purchase 6,570,000 shares of GGI common stock are outstanding under the 2018 Gaucho Plan.

    13.
    LEASES

    los
    Company leased one corporate office in New York, New York, through an operating lease agreement (the “New York Lease”),
    which was set to expire on August 31, 2020. Effective May 31, 2020, the Company terminated the New York Lease. As consideration
    of the termination, the landlord is entitled to retain and apply the full amount of the $61,284 security deposit as a partial
    payment of the rent and the additional rent due and payable under the lease. The Company paid the landlord the following additional
    amounts: (i) $5,683, representing the additional amount of unpaid rent and additional rent due and payable under the lease through
    the termination date, and (ii) $11,860, representing the landlord’s cost for the post-termination date cleaning of the premises.
    The Company recognized a loss of $39,367 in connection with the termination of the lease and the derecognition of
    the ROU asset and related lease liability.

    GAUCHO
    GROUP HOLDINGS, INC. AND SUBSIDIARIES

    NOTES
    TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

    (unaudited)

    Como
    of June 30, 2020, the Company had no leases that were classified as a financing lease and did not have any additional operating
    and financing leases that have not yet commenced.

    Total
    operating lease expenses were $96,361 and $154,177, for the three and six months ended June 30, 2020, respectively, and were $57,816
    and $115,633 for the three and six months ended June 30, 2019, respectively, Lease expenses are recorded in general and administrative
    expenses on the unaudited condensed consolidated statements of operations.

    Supplemental
    cash flows information related to leases was as follows:

    For the six months ended
    June 30,
    2020 2019
    Cash paid for amounts included in the measurement of lease liabilities:
    Operating cash flows from operating leases PS 78,827 PS 118,998
    Right-of-use assets obtained in exchange for lease obligations:
    Operating leases PS – PS 361,020
    Weighted Average Remaining Lease Term:
    Operating leases 0.00 years 1.17 years
    Weighted Average Discount Rate:
    Operating leases 8.0 % 8.0 %

    14.
    SEGMENT DATA

    Prior
    to the commencement of GGI operations, the Company’s chief operating decision-maker (CODM) reviewed the operating results
    of the Company on an aggregate basis and managed the Company’s operations as a single operating segment. As a result of
    the commencement of GGI operations in the fourth quarter of 2019, the Company’s financial position and results of operations
    are classified into three reportable segments, consistent with how the CODM makes decisions about resource allocation and assesses
    the Company’s performance.

    ● Real
    Estate Development, through AWE and TAR, including hospitality and winery operations, which support the ALGODON® brand.
    ● Fashion
    (e-commerce), through GGI, including the manufacture and sale of high-end fashion and accessories sold through an e-commerce
    plataforma.
    ● Corporate,
    consisting of general corporate overhead expenses not directly attributable to any one of the business segments.

    GAUCHO
    GROUP HOLDINGS, INC. AND SUBSIDIARIES

    NOTES
    TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

    (unaudited)

    los
    Company has recast its financial information and disclosures for the prior period to reflect the segment disclosures as if the
    current presentation had been in effect throughout all periods presented. The following tables present segment information for
    the three and six months ended June 30, 2020 and 2019:

    por
    the Three Months Ended June 30, 2020
    por
    the Six Months Ended June 30, 2020
    Real
    Estate Development
    Fashion
    (e-commerce)
    Corporate(1) TOTAL Real
    Estate Development
    Fashion
    (e-commerce)
    Corporate(1) TOTAL
    Revenues PS 117,332 PS – PS – PS 117,332 PS 413,570 PS 749 PS – PS 414,318
    Revenues
    from Foreign Operations
    PS 117,332 PS – PS – PS 117,332 PS 413,570 PS – PS – PS 413,570
    Loss
    from Operations
    PS (548,424 ) PS (251,695 ) PS (635,239 ) PS (1,435,359 ) PS (846,380 ) PS (569,308 ) PS (1,285,395 ) PS (2,701,083 )

    por
    the Three Months Ended June 30, 2019
    por
    the Six Months Ended June 30, 2019
    Real
    Estate
    Desarrollo
    Fashion
    (e-commerce)
    Corporate(1) TOTAL Real
    Estate Development
    Fashion
    (e-commerce)
    Corporate(1) TOTAL
    Revenues PS 268,733 PS – PS – PS 268,733 PS 709,228 PS – PS – PS 709,228
    Revenues
    from Foreign Operations
    PS 268,733 PS – PS – PS 268,733 PS 709,228 PS – PS – PS 709,228
    Loss
    from Operations
    PS (568,053 ) PS (179,453 ) PS (1,124,917 ) PS (1,872,423 ) PS (590,708 ) PS (514,861 ) PS (2,093,711 ) PS (3,199,280 )

    (1)
    Unallocated corporate operating losses resulting from general corporate overhead expenses not directly attributable to any one
    of the business segments.

    15.
    COMMITMENTS AND CONTINGENCIES

    Legal
    Matters

    los
    Company is involved in litigation and arbitrations from time to time in the ordinary course of business. After consulting legal
    counsel, the Company does not believe that the outcome of any such pending or threatened litigation will have a material adverse
    effect on its financial condition or results of operations. However, as is inherent in legal proceedings, there is a risk that
    an unpredictable decision adverse to the Company could be reached. The Company records legal costs associated with loss contingencies
    as incurred. Settlements are accrued when, and if, they become probable and estimable.

    GAUCHO
    GROUP HOLDINGS, INC. AND SUBSIDIARIES

    NOTES
    TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

    (unaudited)

    Employment
    Agreement

    En
    September 28, 2015, the Company entered into an employment agreement with Scott Mathis, the Company’s CEO (the “Employment
    Agreement”). Among other things, the agreement provided for a three-year term of employment at an annual salary of $401,700
    (subject to a 3% cost-of-living adjustment per year), bonus eligibility, paid vacation and specified business expense reimbursements.
    The agreement sets limits on Mr. Mathis’ annual sales of GGH common stock. Mr. Mathis is subject to a covenant not to compete
    during the term of the agreement and following his termination for any reason, for a period of twelve months. Upon a change of
    control (as defined by the agreement), all of Mr. Mathis’ outstanding equity-based awards will vest in full and his employment
    term resets to two years from the date of the change of control. Following Mr. Mathis’s termination for any reason, Mr.
    Mathis is prohibited from soliciting Company clients or employees for one year and disclosing any confidential information of
    GGH for a period of two years. The agreement may be terminated by the Company for cause or by the CEO for good reason, in accordance
    with the terms of the agreement. The Board of Directors extended the Employment Agreement on various dates such that as of March
    29, 2020 the Employment Agreement, as amended, expires on December 31, 2020. All other terms of the Employment Agreement remain
    lo mismo. The Board of Directors also approved the payment of Mr. Mathis’ cost of living salary adjustment of 3% for the
    years 2019 and 2020 to be paid in equal monthly installments beginning January 1, 2021, provided the Company has uplisted to a
    national stock exchange. The Board of Directors granted a retention bonus to Mr. Mathis that consists of the real estate lot on
    which Mr. Mathis has been constructing a home at Algodon Wine Estates, to vest in one-third increments over the next three years
    (the “Retention Period”), provided Mr. Mathis’s performance as an employee with the Company continues to be
    satisfactory, as deemed by the Board of Directors. The current market value of the lot is $115,000, and before ownership of the
    lot can be transferred to Mr. Mathis, the Company must be legally permitted to issue a deed for the property. Mr. Mathis is eligible
    to receive a pro-rata portion of the bonus if his employment is terminated before the end of the Retention Period.

    Debido
    to economic circumstances related to the global coronavirus outbreak 2019 (COVID-19), on March 13, 2020, Mr. Mathis voluntarily
    deferred payment of 85% of his salary. The Company is accruing all compensation not paid to Mr. Mathis pursuant to his employment
    agreement until the Company has sufficient funds to pay his full compensation.

    16.
    SUBSEQUENT EVENTS

    administración
    has evaluated all subsequent events to determine if events or transactions occurring through the date the condensed consolidated
    financial statements were issued, require adjustment to or disclosure in the accompanying condensed consolidated financial statements.

    Convertible Notes

    Between July 1, 2020
    and August 4, 2020, the Company sold Convertible Notes in an aggregate amount of $577,763 to accredited investors who are all
    stockholders of the Company. The Convertible Notes mature on December 31, 2020 and bear interest at 7% per annum. Principal and
    interest outstanding under the Convertible Notes are convertible (i) automatically upon the Public Offering, at a conversion price
    equal to 85% of the price per share of the Company’s common stock sold in the Public Offering (the “Mandatory Conversion
    Option”, or (ii) at the option of the holder at any time prior to the Public Offering at a conversion price equal to the
    closing price of the Company’s common stock on the day prior to conversion (the “Holder’s Conversion Option”).

    Foreign
    Currency Exchange Rates

    los
    Argentine peso to United States dollar exchange rate was 73.0484, 70.3968 and 59.8979 at August 18, June 30, 2020
    and December 31, 2019, respectively.

    los
    British pound to United States dollar exchange rate was 0.7633, 0.8137 and 0.7541 at August 18, June 30, 2020, and
    December 31, 2019, respectively.

    Articulo
    2: MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

    los
    following discussion should be read in conjunction with our unaudited condensed consolidated financial statements and notes thereto
    included herein. In connection with, and because we desire to take advantage of, the “safe harbor” provisions of the
    Private Securities Litigation Reform Act of 1995, we caution readers regarding certain forward looking statements in the following
    discussion and elsewhere in this report and in any other statement made by, or on our behalf, whether or not in future filings
    con la Comisión de Bolsa y Valores. Forward-looking statements are statements not based on historical information and
    which relate to future operations, strategies, financial results or other developments. Forward looking statements are necessarily
    based upon estimates and assumptions that are inherently subject to significant business, economic and competitive uncertainties
    and contingencies, many of which are beyond our control and many of which, with respect to future business decisions, are subject
    to change. These uncertainties and contingencies can affect actual results and could cause actual results to differ materially
    from those expressed in any forward-looking statements made by, or on our behalf. Words such as “anticipate,” “estimate,”
    “plan,” “continuing,” “ongoing,” “expect,” “believe,” “intend,”
    “may,” “will,” “should,” “could,” and similar expressions are used to identify
    forward-looking statements. We disclaim any obligation to update forward-looking statements.

    los
    independent registered public accounting firm’s report on the Company’s consolidated financial statements as of December
    31, 2019, and for each of the years in the two-year period then ended, includes a “going concern” explanatory paragraph,
    that describes substantial doubt about the Company’s ability to continue as a going concern.

    Unless
    the context requires otherwise, references in this document to “GGH”, “we”, “our”, “us”
    or the “Company” are to Gaucho Group Holdings, Inc. and its subsidiaries.

    Por favor
    note that because we qualify as an emerging growth company and as a smaller reporting company, we have elected to follow the smaller
    reporting company rules in preparing this Quarterly Report on Form 10-Q.

    Visión general

    Nosotros
    are an integrated, lifestyle related real estate development company, capitalizing on our unique brand of affordable luxury, branded
    as “Algodon”, to create a diverse set of interrelated products and services. Our wines, hotels and real estate ventures
    and fashion sales, currently concentrated in Argentina, offer a blend of high-end, luxury and adventures products. We hope to
    further broaden the reach and depth of our services to strengthen and cement the reach of our brand. Ultimately, we intend to
    further expand and grow our business by combining unique and promising opportunities with our brand and clientele.

    Through
    our subsidiaries, we currently operate Algodon Mansion, a Buenos Aires-based luxury boutique hotel property and we have redeveloped,
    expanded and repositioned a winery and golf resort property called Algodon Wine Estates for subdivision of a portion of this property
    for residential development. We have also established an e-commerce platform for the sale of high-end luxury fashion and accessories.

    Investment
    in foreign real estate requires consideration of certain risks typically not associated with investing in the United States. Tal
    risks include, trade balances and imbalances and related economic policies, unfavorable currency exchange rate fluctuations, imposition
    of exchange control regulation by the United States or foreign governments, United States and foreign withholding taxes, limitations
    on the removal of funds or other assets, policies of governments with respect to possible nationalization of their industries,
    political difficulties, including expropriation of assets, confiscatory taxation and economic or political instability in foreign
    nations or changes in laws which affect foreign investors.

    Reciente
    Developments and Trends

    En
    December 2019, the 2019 novel coronavirus (“COVID-19”) surfaced in Wuhan, China. The World Health Organization declared
    the outbreak as a global pandemic in March 2020. Recently, we temporarily closed our corporate office, as well as our hotel, restaurant,
    winery operations, and golf and tennis operations. Further, the Gaucho factories have closed, borders for importing product have
    been impacted and the Gaucho fulfillment center is also closed. In response, we have negotiated out of our New York lease, renegotiated
    with our vendors and implemented salary reductions in order to reduce Company costs. We have also created an e-commerce platform
    for our wine sales in response to the pandemic. We are continuing to monitor the outbreak of COVID-19 and the related business
    and travel restrictions, and the changes to behavior intended to reduce its spread, and the related impact on our operations,
    financial position and cash flows, as well as the impact on our employees. Due to the rapid development and fluidity of this situation,
    the magnitude and duration of the pandemic and its impact on our future operations and liquidity is uncertain as of the date of
    this report. While there could ultimately be a material impact on our operations and liquidity, this impact cannot currently be
    determined.

    Financings

    During
    the six months ended June 30, 2020, we raised approximately $2.1 million of new capital through the issuance of convertible and
    non-convertible debt, proceeds from the U.S. Small Business Administration (“SBA”) Paycheck Protection Program Loan
    (the “PPP Loan”), and the Economic Injury Disaster Loan (“EIDL”), partially offset by approximately $0.2
    million due to repayments of convertible and non-convertible debt and repurchase of preferred stock from a shareholder. Nosotros usamos
    the net proceeds from these issuances for general working capital and capital expenditures.

    Liquidez
    and Going Concern

    Como
    reflected in our accompanying condensed consolidated financial statements, we have generated significant losses which have
    resulted in a total accumulated deficit of approximately $90 million, raising substantial doubt that we will be able to
    continue operations as a going concern. In the audit opinion for our financial statements as of and for the year ended
    December 31, 2019, our independent auditors included an explanatory paragraph expressing substantial doubt about our ability
    to continue as a going concern based upon our accumulated deficit and our working capital deficit as of December 31, 2019,
    and our need to raise additional funds to meet our obligations and sustain our operations. Our ability to execute our
    business plan is dependent upon our generating cash flow and obtaining additional debt or equity capital sufficient to fund
    operations. If we are able to obtain additional debt or equity capital (of which there can be no assurance), we hope to
    acquire additional management as well as increase the marketing of our products and continue the development of our real
    estate holdings.

    Nuestra
    business strategy may not be successful in addressing these issues and there can be no assurance that we will be able to obtain
    any additional capital. If we cannot execute our business plan on a timely basis (including acquiring additional capital), our
    stockholders may lose their entire investment in us, because we may have to delay vendor payments and/or initiate cost reductions
    and possibly sell certain company assets, which would have a material adverse effect on our business, financial condition and
    results of operations, and we could ultimately be forced to discontinue our operations, liquidate and/or seek reorganization under
    the U.S. bankruptcy code. The conditions outlined above indicate that there is substantial doubt about our ability to continue
    as a going concern within one year after the financial statement issuance date.

    Our unaudited condensed
    consolidated financial statements included elsewhere in this Quarterly Report on Form 10-Q have been prepared in conformity with
    accounting principles generally accepted in the United States of America (“U.S. GAAP”), which contemplate our continuation
    as a going concern and the realization of assets and satisfaction of liabilities in the normal course of business. The carrying
    amounts of assets and liabilities presented in the unaudited condensed consolidated financial statements do not necessarily purport
    to represent realizable or settlement values. The unaudited condensed consolidated financial statements do not include any adjustment
    that might result from the outcome of this uncertainty.

    Consolidated
    Results of Operations

    Three
    months ended June 30, 2020 compared to three months ended June 30, 2019

    Visión general

    Nosotros
    reported net losses of approximately $1.5 million and $2.0 million for the three months ended June 30, 2020 and 2019, respectively.

    Revenues

    Revenues
    were approximately $117,000 and $269,000 during the three months ended June 30, 2020 and 2019, respectively, representing a decrease
    of $152,000 or 57%. Decreases in revenue results primarily from a decrease in hotel and restaurant revenues of approximately $126,000
    resulting from the temporary closure of our hotel and restaurants due to government restrictions as of a result of COVID-19, and
    a decrease of approximately $52,000 resulting from the impact of the decline in the value of the Argentine peso vis-à-vis
    the U.S. dollar for the three months ended June 30, 2020 compared to the three months ended June 30, 2019, partially offset by
    an increase in wine sales of approximately $15,000 as a result of our e-commerce wine sales and an increase in agricultural revenues
    of approximately $11,000 resulting from the sale of grapes during the quarter.

    Gross
    pérdida

    We generated a gross
    loss of approximately $124,000 for the three months ended June 30, 2020 as compared to a gross loss of approximately $133,000
    for the three months ended June 30, 2019, representing a decrease of $9,000 or 7%, primarily as the result
    of the decrease in our revenues as described above.

    Cost
    of sales, which consists of real estate lots, raw materials, direct labor and indirect labor associated with our business activities,
    decreased by approximately $160,000 from $401,000 for the three months ended June 30, 2019 to $241,000 for the three months ended
    June 30, 2020. The decrease in cost of sales results from the decrease in hotel and restaurant costs of approximately $146,000
    resulting from the temporary closure of our hotel and restaurants due to government restrictions as of a result of COVID-19, and
    a decrease of approximately $117,000 resulting from the impact of the decline in the value of the Argentine peso vis-à-vis
    the U.S. dollar for the three months ended June 30, 2020 compared to the three months ended June 30, 2019, were partially offset
    by an increase in the cost of grapes sold during the period of $113,000.

    De venta
    and marketing expenses

    De venta
    and marketing expenses were approximately $12,000 and $125,000 for the three months ended June 30, 2020 and 2019, respectively,
    representing a decrease of $113,000 or 90% in 2020, primarily resulting from the impact of COVID-19 shut-downs during the quarter,
    as well as a Gaucho Group marketing event that was held in the second quarter of 2019.

    General
    and administrative expenses

    General and administrative
    expenses were approximately $1,253,000 and $1,552,000 for the three months ended June 30, 2020 and 2019, respectively,
    representing a decrease of $299,000 or 19%. The decrease results primarily from the decreases of approximately $141,000
    in professional fees, approximately $95,000 in travel expenses, and approximately $100,000 resulting from the impact of the decline
    in the value of the Argentine peso vis-à-vis the U.S. dollar for the three months ended June 30, 2020 compared to the three
    months ended June 30, 2019, partially offset by the $39,000 loss recognized in connection with the termination of the Company’s
    New York office lease.

    Depreciation
    and amortization expense

    Depreciation
    and amortization expense was approximately $46,000 and $63,000 during the three months ended June 30, 2020 and 2019, respectively,
    representing a decrease of $17,000 or 27%, primarily resulting from the impact of the decline in the value of the Argentine peso
    vis-à-vis the U.S. dollar for the three months ended June 30, 2020 compared to the three months ended June 30, 2019.

    Interest
    expense, net

    Interest
    expense, net was approximately $91,000 and $105,000 during the three months ended June 30, 2020 and 2019, respectively, representing
    a decrease of $14,000 or 13%, primarily resulting from the impact of the decline in the value of the Argentine peso vis-à-vis
    the U.S. dollar for the three months ended June 30, 2020 compared to the three months ended June 30, 2019.

    Six
    months ended June 30, 2020 compared to six months ended June 30, 2019

    Visión general

    Nosotros
    reported net losses of approximately $2.8 million and $3.4 million for the six months ended June 30, 2020 and 2019, respectively.

    Revenues

    Revenues
    were approximately $414,000 and $709,000 during the six months ended June 30, 2020 and 2019, respectively, representing a decrease
    of $295,000 or 42%. Decreases in revenues are primarily due to approximately $196,000 resulting from the impact of the decline
    in the value of the Argentine peso vis-à-vis the U.S. dollar for the six months ended June 30, 2020 compared to the six
    months ended June 30, 2019, decreases in wine sales of approximately $74,000, and a decrease in hotel and restaurant revenues
    of approximately $57,000, partially offset by an increase in agricultural revenues of approximately $11,000 resulting from the
    sale of grapes during the quarter.

    Gross
    (loss) profit

    Nosotros
    generated a gross loss of approximately $(76,000) for the six months ended June 30, 2020 as compared to a gross profit of approximately
    $79,000 for the six months ended June 30, 2019, representing a decrease of $155,000 or 196%, primarily as a result of the decrease
    in revenues as described above.

    Cost
    of sales, which consists of real estate lots, raw materials, direct labor and indirect labor associated with our business activities,
    decreased by approximately $139,000 from $630,000 for the six months ended June 30, 2019 to $491,000 for the six months ended
    June 30, 2020. The decrease in cost of sales results consists primarily of decrease of approximately $20,000 in hotel and restaurant
    costs resulting from the decline in revenues as described above, and approximately $226,000 related to the impact of the decline
    in the value of the Argentine peso vis-à-vis the U.S. dollar, partially offset by an increase in the cost of grapes sold
    during the period of approximately $113,000.

    De venta
    and marketing expenses

    De venta
    and marketing expenses were approximately $50,000 and $237,000 for the six months ended June 30, 2020 and 2019, respectively,
    representing a decrease of $187,000 or 79% in 2020, primarily resulting from the impact of COVID-19 shut-downs as well as a Gaucho
    Group marketing event that was held in the second quarter of 2019.

    General
    and administrative expenses

    General and administrative
    expenses were approximately $2,482,000 and $2,929,000 for the six months ended June 30, 2020 and 2019, respectively, representing
    a decrease of $447,000 or 15%. The decrease results primarily from the decreases of approximately $264,000 in professional
    fees, approximately $196,000 in travel expenses, and approximately $249,000 resulting from the impact of the decline in the value
    of the Argentine peso vis-à-vis the U.S. dollar for the six months ended June 30, 2020 compared to the six months ended
    June 30, 2019, partially offset by an increase of approximately $199,000 in exchange rate losses and $39,000 loss recognized
    in connection with the termination of the Company’s New York office lease.

    Depreciation
    and amortization expense

    Depreciation
    and amortization expense was approximately $93,000 and $112,000 during the six months ended June 30, 2020 and 2019, respectively,
    representing a decrease of $19,000 or 17%, primarily resulting from the impact of the decline in the value of the Argentine peso
    vis-à-vis the U.S. dollar for the three months ended June 30, 2020 compared to the three months ended June 30, 2019.

    Interest
    expense, net

    Interest
    expense, net was approximately $121,000 and $227,000 during the six months ended June 30, 2020 and 2019, respectively, representing
    a decrease of $106,000 or 47%. The decrease is primarily the result of (i) decrease in the average balance of debt outstanding
    during the six months ended June 30, 2020 as compared to the six months ended June 30, 2019, as a result of principal payments
    on loans payable and debt obligations of approximately $220,000 and $50,000, respectively, as well as the conversion of approximately
    $2,107,000 of debt principal and related interest payable into equity of GGI on June 30, 2019, and (ii) the decrease in
    interest expenses to the Federal Administration of Public Revenues in Argentine due to renegotiating the payment plan.

    Liquidez
    and Capital Resources

    Nosotros
    measure our liquidity a variety of ways, including the following:

    junio
    30,
    2020
    diciembre
    31,
    2019
    Cash PS 150,710 PS 40,378
    Working
    Capital (Deficiency)
    PS (5,165,818 ) PS (3,309,206 )

    Based
    upon our working capital deficiency as of June 30, 2020, we require additional equity and/or debt financing in order to sustain
    operations. These conditions raise substantial doubt about our ability to continue as a going concern.

    During
    the six months ended June 30, 2020 and 2019, we have relied primarily on debt and equity offerings to third party independent,
    accredited investors, related parties, and the government to sustain operations. During the six months ended June 30, 2020, we
    received proceeds of approximately $1,358,000 from the issuance of convertible debt, proceeds from related party loans payable
    and non-related party loans payable of approximately $267,000 and $28,000, respectively, proceeds from the PPP Loan of
    approximately $242,000, and proceeds from the EIDL of $94,000.

    los
    proceeds from these financing activities were used to fund our existing operating deficits, legal and accounting expenses associated
    with being a public company and the general working capital needs of the business.

    Availability
    of Additional Funds

    Como
    a result of the above developments, we have been able to sustain operations. However, we will need to raise additional capital
    in order to meet our future liquidity needs for operating expenses and capital expenditures, including GGI inventory production,
    development of the GGI e-commerce platform, expansion of our winery and additional investments in real estate development. Si
    we are unable to obtain adequate funds on reasonable terms, we may be required to significantly curtail or discontinue operations.

    Sources
    and Uses of Cash for the Six months ended June 30, 2020 and 2019

    Net
    Cash Used in Operating Activities

    Net cash used in operating
    activities for the six months ended June 30, 2020 and 2019 amounted to approximately $2,036,000 and $3,420,000, respectively.
    During the six months ended June 30, 2020 the net cash used in operating activities was primarily attributable to the net loss
    of approximately $2,802,000, adjusted for approximately $407,000 of net non-cash expenses, and approximately $359,000
    of cash provided by changes in the levels of operating assets and liabilities. During the six months ended June 30, 2019,
    the net cash used in operating activities was primarily attributable to the net loss of approximately $3,394,000, adjusted for
    approximately $459,000 of net non-cash expenses, and approximately $485,000 of cash used for changes in the levels of operating
    assets and liabilities.

    Cash
    Used in Investing Activities

    Cash
    used in investing activities for the six months ended June 30,2020 and 2019 amounted to approximately $17,000 and $122,000, respectively.
    Cash used in investing activities during the six months ended June 30, 2020 and 2019 resulted entirely from the purchase of property
    and equipment.

    Net
    Cash Provided by Financing Activities

    Net cash provided by financing
    activities for the six months ended June 30 and 2019 amounted to approximately $1,745,000 and $3,620,000, respectively.
    For the six months ended June 30, 2020 the net cash provided by financing activities resulted from approximately $1,358,000 of
    proceeds from convertible debt obligations, approximately $267,000 and $28,000, respectively, from the proceeds from the
    issuance of related party loans payable and non-related party loans payable, approximately $242,000 of proceeds from the PPP Loan,
    and $94,000 of proceeds from the EIDL, partially offset by loan repayments of approximately $229,000 and the repurchase
    of preferred stock of $16,000 from a shareholder. For the six months ended June 30, 2019, the net cash provided by financing activities
    resulted primarily from approximately $786,000 of proceeds from convertible debt obligations and approximately $3,010,000 of proceeds
    from common stock offerings, partially offset by debt and loan repayments of approximately $176,000.

    Going
    Concern and Management’s Liquidity Plans

    los
    accompanying condensed consolidated financial statements have been prepared assuming that we will continue as a going concern,
    which contemplates the realization of assets and satisfaction of liabilities and commitments in the normal course of business.
    As discussed in Note 2 to the accompanying condensed consolidated financial statements, we have not achieved a sufficient level
    of revenues to support our business and development activities and have suffered substantial recurring losses from operations
    since our inception. Further, while the Company plans to apply to NASDAQ later this year to uplist its common stock following
    a public offering of equity, should that effort not be successful, the Company would be required, on December 31, 2020, to redeem
    all Series B Shares that have not been previously converted to common stock. The cost to redeem these shares would likely have
    a materially adverse effect on the Company’s financial position and would likely require either the liquidation of certain
    Company assets or an effort to raise new equity or debt financing. Whether the Company would be able to consummate any such transaction,
    should it need to do so, on economically beneficial terms or otherwise, cannot be presently known. These conditions raise substantial
    doubt that we will be able to continue operations as a going concern. The accompanying condensed consolidated financial statements
    do not include any adjustments that might be necessary if we were unable to continue as a going concern.

    Nosotros
    are continuing to monitor the outbreak of COVID-19, as described above, and the related impact on our operations, financial position
    and cash flows, as well as the impact on our employees. Recently, we temporarily closed our corporate office, as well as our hotel,
    restaurant, winery operations, and golf and tennis operations. Further, the Gaucho factories have closed, borders for importing
    product have been impacted and the Gaucho fulfillment center is also closed. In response we have reduced costs by negotiating
    out of our New York lease, renegotiating with our vendors and implementing salary reductions. We have also created an e-commerce
    platform for our wine sales in response to the pandemic. Due to the rapid development and fluidity of this situation, the magnitude
    and duration of the pandemic and its impact on our future operations and liquidity are uncertain as of the date of this report.
    While there could ultimately be a material impact on our operations and liquidity, this impact cannot currently be determined.

    Based
    on current cash on hand and subsequent activity as described herein, our cash-on-hand only allows us to operate our business operations
    on a month-to-month basis. Because of our limited cash availability, we have scaled back our operations to the extent possible.
    While we are exploring opportunities with third parties and related parties to provide some or all of the capital we need, we
    have not entered into any agreement to provide us with the necessary capital. Historically, we have been successful in raising
    funds to support our capital needs. However, if we are unable to obtain additional financing on a timely basis, we may have to
    delay vendor payments and/or initiate cost reductions, which would have a material adverse effect on our business, financial condition
    and results of operations, and ultimately, we could be forced to discontinue our operations, liquidate assets and/or seek reorganization
    under the U.S. bankruptcy code. As a result, our auditors have issued a report which includes an explanatory paragraph relating
    to our ability to continue as a going concern in conjunction with their audit of our December 31, 2019 and 2018 consolidated financial
    statements.

    Off-Balance
    Sheet Arrangements

    Ninguna.

    Contractual
    Obligations

    Como
    a smaller reporting company, we are not required to provide the information requested by paragraph (a)(5) of this Item.

    Critical
    Accounting Policies and Estimates

    Ahí
    are no material changes from the critical accounting policies, estimates and new accounting pronouncements set forth in “Management’s
    Discussion and Analysis of Financial Condition and Results of Operations” set forth in our Annual Report on Form 10-K filed
    with the SEC on March 30, 2020. Please refer to that document for disclosures regarding the critical accounting policies related
    to our business.

    Articulo
    3. Quantitative and Qualitative Disclosure About Market Risk

    Como
    a “smaller reporting company” as defined by Item 10 of Regulation S-K, we are not required to provide the information
    required by this Item.

    Articulo
    4: Controls and Procedures

    Disclosure
    Controls and Procedures

    Nuestra
    management carried out an evaluation, under the supervision and with the participation of our Chief Executive Officer (who is
    our Principal Executive Officer) and our Chief Financial Officer (who is our Principal Financial Officer and Principal Accounting
    Officer), of the effectiveness of the design of our disclosure controls and procedures (as defined by Exchange Act Rules 13a-15(e)
    or 15d-15(e)) as of June 30, 2020, pursuant to Exchange Act Rule 13a-15(b). Based upon that evaluation, our Principal Executive
    Officer and Principal Financial Officer concluded that our disclosure controls and procedures were effective as of June 30, 2020.

    Cambios
    in Internal Control over Financial Reporting

    Ahí
    were no changes in our internal control over financial reporting identified in management’s evaluation pursuant to Rules
    13a-15(d) or 15d-15(d) of the Exchange Act during the quarter ended June 30, 2020 that materially affected, or are reasonably
    likely to materially affect, our internal control over financial reporting.

    Inherent
    Limitations of Controls

    administración
    does not expect that our disclosure controls and procedures or our internal control over financial reporting will prevent or detect
    all error and all fraud. Controls and procedures, no matter how well designed and operated, can provide only reasonable assurance
    of achieving their objectives and management necessarily applies its judgment in evaluating the cost-benefit relationship of possible
    controls and procedures. Because of the inherent limitations in all control systems, no evaluation of controls can provide absolute
    assurance that all control issues and instances of fraud, if any, within the Company have been detected. These inherent limitations
    include the realities that judgments in decision-making can be faulty, and that breakdowns can occur because of a simple error
    or mistake. Additionally, controls can be circumvented by the individual acts of some persons, by collusion of two or more people,
    or by management override of the controls. The design of any system of controls also is based in part upon certain assumptions
    about the likelihood of future events, and there can be no assurance that any design will succeed in achieving its stated goals
    under all potential future conditions. Over time, controls may become inadequate because of changes in conditions, or deterioration
    in the degree of compliance with the policies or procedures. Because of the inherent limitations in a cost-effective control system,
    misstatements due to error or fraud may occur and not be detected.

    PART
    II – OTHER INFORMATION

    Articulo
    1. Legal Proceedings

    De
    time to time GGH and its subsidiaries and affiliates are subject to litigation and arbitration claims incidental to its business.
    Such claims may not be covered by its insurance coverage, and even if they are, if claims against GGH and its subsidiaries are
    successful, they may exceed the limits of applicable insurance coverage. We are not involved in any litigation that we believe
    is likely, individually or in the aggregate, to have a material adverse effect on our consolidated financial condition, results
    of operations or cash flows.

    Articulo
    1A. Risk Factors

    Como
    a “smaller reporting company” as defined by Item 10 of Regulation S-K, we are not required to provide information
    required by this Item. However, our current risk factors are set forth in our Annual Report on Form 10-K for the year ended December
    31, 2019, filed with the SEC on March 30, 2020, our Quarterly Report on Form 10-Q for the period ended March 31, 2020, filed with
    the SEC on July 6, 2020 and below.

    Nosotros
    face significant business disruption and related risks resulting from the COVID-19 pandemic, which could have a material adverse
    effect on our business and results of operations.

    A
    update the risk factors disclosed in our Quarterly Report for the period ended March 31, 2020, the Company has reduced expenses
    by negotiating an early termination of our office lease at 135 Fifth Avenue in New York City, and all employees and contractors
    are currently working from home. In addition, we are reviewing our labor needs to run the administrative side of the Company in
    New York.

    Beginning Monday, April
    13, 2020, Gaucho – Buenos Aires’s warehouse and fulfillment center, Bergen Logistics, announced it would operate on
    a four day schedule from Monday through Thursday, allowing for a 72 hour window from Friday through Sunday for any possible surface
    viruses to self-eliminate. On June 12, Bergen announced that it would increase its warehouse operations to a Sunday through Friday
    schedule.

    Throughout the pandemic,
    we also experienced significant delays in product development, production, and shipping from our oversees manufacturing partners,
    many of whom have been on complete lockdown for the safety of their workers. Some of our manufacturing partners have even had
    to close permanently. Because of this, we are in the process of pursuing new vendors.

    Due to the events stated
    above, it was necessary for us to reduce our email marketing efforts to our customer database, as we were not able to fulfill
    orders. This resulted in a significant reduction in web traffic and sales.

    Although
    the Company presently has enough cash on hand to sustain its operations on a month to month basis, we are continuing to explore
    opportunities with third parties and related parties to provide some or all of the capital we need. However, if we are unable
    to obtain additional financing on a timely basis, we may have to delay vendor payments and/or initiate cost reductions, which
    would have a material adverse effect on our business, financial condition and results of operations, and ultimately, we could
    be forced to discontinue our operations, liquidate assets and/or seek reorganization under the U.S. bankruptcy code. As a result,
    our auditors have issued a report which includes an explanatory paragraph relating to our ability to continue as a going concern
    in conjunction with their audit of our December 31, 2019 and 2018 consolidated financial statements.

    Articulo
    2. Unregistered Sales of Equity Securities and Use of Proceeds.

    En
    February 17, 2020, the Board of Directors approved the offer and sale of a series of unsecured convertible promissory notes (the
    “Convertible Notes”) in an amount up to $1,500,000 and subsequently on March 29, 2020, unanimously approved an increase
    to $3,000,000 to accredited investors with a substantive pre-existing relationship with the Company, in a private placement. los
    Convertible Notes each have the same terms with a maturity date of December 31, 2020 (the “Maturity Date”) and mandatory
    conversion into common stock of the Company registered under the Securities Act of 1933, as amended (the “Securities Act”)
    with a 15% discount price to the offer and sale of the Company’s common shares upon a registered offering and uplist to
    Nasdaq (the “Mandatory Conversion”). At any time before the Mandatory Conversion but no later than the Maturity Date,
    holders of the Convertible Notes will have the right to convert the total principal amount of the Convertible Notes, together
    with all accrued and unpaid interest thereon into shares of unregistered common stock of the Company at the closing price of the
    Company’s stock as quoted on the over-the-counter market as of the trading day prior to receipt of the notice to convert.

    Between
    April 1, 2020 and June 30, 2020, the Company sold Convertible Notes in an aggregate amount of $633,420 to accredited investors
    who are all stockholders of the Company. No general solicitation was used, no commissions were paid, and the Company relied on
    the exemption from registration available under Section 4(a)(2) and Rule 506(b) of Regulation D of the Securities Act, in connection
    with the sales. A Form D was filed with the Securities and Exchange Commission on March 11, 2020, an amended Form D was filed
    on May 29, 2020, an amended Form D was filed on July 13, 2020, and an amended Form D was filed on August 10, 2020.

    Articulo
    3. Defaults upon Senior Securities

    En
    March 31, 2017, the Company received a bank loan in the amount of $519,156 (ARS $8,000,000) (the “2017 Loan”). los
    loan bears interest at 24.18% per annum and is due on March 1, 2021. Principal and interest will be paid in forty-two monthly
    installments beginning on October 1, 2017 and ending on March 1, 2021. During 2018, the Company defaulted on certain 2017 Loan
    payments, and as a result, the 2017 Loan is currently payable upon demand.

    En
    January 25, 2018, the Company received a bank loan in the amount of $525,000 (the “2018 Loan”), denominated in U.S.
    dollars. The loan bears interest at 6.75% per annum and is due on January 25, 2023. Principal and interest will be paid in 60
    equal monthly installments of $10,311, beginning on February 23, 2018. During 2018, the Company defaulted on certain 2018 Loan
    payments, and as a result, the 2018 Loan is currently payable upon demand.

    Como
    previously reported on the Company’s Annual Reports on Forms 10-K for the years ending December 31, 2017, December 31, 2018,
    and December 31, 2019, the Company sold convertible promissory notes in the aggregate principal amount of $2,046,730 (together,
    the “2017 Notes”). The 2017 Notes matured 90 days from the date of issuance, bear interest at 8% per annum and were
    convertible into the Company’s common stock at $0.63 per share, which represented a 10% discount to the price used for the
    sale of the Company’s common stock at the commitment date. As of June 30, 2020, principal of $1,170,354 and interest of
    $190,649 outstanding on the 2017 Notes is past due and is payable on demand. The 2017 Notes are no longer convertible.

    Como
    disclosed previously in the Company’s Annual Report on Form 10-K for the year ended December 31, 2019, the Company’s
    subsidiary, Gaucho Group, Inc. (“GGI”) sold convertible promissory notes in the total amount of $2,266,800 to accredited
    investors (the “GGI Notes”). The maturity date of the notes was March 31, 2019, and at the option of the holder, the
    principal amount of the note plus accrued interest could be converted into GGI common stock at a 20% discount to the share price
    in a future offering of common stock by GGI. One GGI Note representing $100,000 of principal and $4,498 of interest is past due
    as of June 30, 2020 and payable on demand. GGI Notes are no longer convertible since the notes are past their maturity date.

    Articulo
    4. Mine and Safety Disclosure

    No
    applicable.

    Articulo
    5. Other Information

    Between
    July 1, 2020 and August 4, 2020, the Company sold Convertible Notes in an aggregate amount of $577,763 to accredited
    investors who are all stockholders of the Company. No general solicitation was used, no commissions were paid, and the Company
    relied on the exemption from registration available under Section 4(a)(2) and Rule 506(b) of Regulation D of the Securities Act,
    in connection with the sales. A Form D was filed with the Securities and Exchange Commission on March 11, 2020, an amended Form
    D was filed on May 29, 2020, an amended Form D was filed on July 13, 2020, and an amended Form D was filed on August 10, 2020.

    Articulo
    6. Exhibits

    los
    following is a complete list of exhibits filed as part of this Form 10-Q. Exhibit numbers correspond to the numbers in the Exhibit
    Table of Item 601 of Regulation S-K.

    Exhibit Descripción
    3.1 Amended and Restated Certificate of Incorporation filed September 30, 2013 1
    3.2 Amendment to the Amended and Restated Certificate of Incorporation filed September 20, 2018 and effective October 1, 2018 17
    3.3 Certificate of Amendment of the Amended and Restated Certificate of Incorporation filed March 1, 2019 and effective March 11, 2019 9
    3.7 Amended and Restated Bylaws 7
    3.8 Amendment to the Company’s Amended and Restated Bylaws as approved on July 8, 2019 10
    4.1 Amended and Restated Certificate of Designation of the Series A Preferred filed September 30, 2013 1
    4.2 Amendment No. 1 to the Amended and Restated Certificate of Designation of Series A Convertible Preferred Stock, dated February 28, 2017 2
    4.3 Certificate of Designation of Series B Convertible Preferred Stock, dated February 28, 2017 2
    4.4 Amendment to the Company’s Certificate of Designation of the Series B Convertible Preferred Stock as approved by the Board of Directors and the Series B Preferred stockholders on December 3, 2019 and filed with the Delaware Secretary of State.11
    4.5 Amendment to the Company’s Certificate of Designation of the Series B Convertible Preferred Stock as approved by the Board of Directors and the Series B Preferred stockholders on January 30, 2020 and filed with the Delaware Secretary of State. 12
    4.5 Amendment to the Company’s Certificate of Designation of the Series B Convertible Preferred Stock as approved by the Board of Directors on March 29 and the Series B Preferred stockholders on March 27, 2020 and filed with the Delaware Secretary of State. 15
    4.6 2016 Stock Option Plan. 3
    4.7 First Amendment to 2016 Stock Option Plan as adopted by the Board of Directors on October 20, 2016. 3
    4.8 2018 Equity Incentive Plan. 8
    4.9 Amendment to the Company’s 2018 Equity Incentive Plan as approved by the Board of Directors on May 13, 2019 and the stockholders on July 8, 2019 10
    4.10 Amendment to the Company’s 2018 Equity Incentive Plan effective July 8, 2019 as approved by the Board of Directors 13
    10.1 Employment Agreement by and between the Company and Scott L. Mathis dated September 28, 2015 5
    10.1 Retention Bonus Agreement by and between the Company and Scott L. Mathis dated March 29, 2020 15
    10.2 Agreement of Lease between 135 Fifth Avenue LLC and Diversified Biotech Holdings Corp. dated July 1, 2006 and Amendment of Lease between 135 Fifth Avenue LLC and Diversified Private Equity Corp., dated September 1, 2010 1
    10.3 Second Amendment of Lease between 135 Fifth Avenue LLC and Diversified Private Equity Corp., dated July 10, 2015 4
    10.4 Investor Relations Consulting Agreement between MZHCI, LLC and the Company, dated April 8, 2016 6
    10.5 Expense Sharing Agreement between Hollywood Burger Holdings Inc. and the Company, dated April 1, 2010, as last amended on December 27, 2019 14
    10.6 Loan Agreement between the Company and Santander Bank, N.A., dated May 6, 2020dieciséis

    1. Incorporated
    by reference from the Company’s Registration of Securities Pursuant to Section 12(g) on Form 10 dated May 14, 2014.
    2. Incorporated
    by reference from the Company’s Current Report on Form 8-K, filed on March 2, 2017.
    3. Incorporated
    by reference from the Company’s Annual Report on Form 10-K, filed on March 31, 2017.
    4. Incorporated
    by reference from the Company’s Annual Report on Form 10-K, filed on March 30, 2016.
    5. Incorporated
    by reference from the Company’s Quarterly report on Form 10-Q, filed on November 16, 2015.
    6. Incorporated
    by reference from the Company’s Quarterly Report on Form 10-Q, filed on May 16, 2016.
    7. Incorporated
    by reference from the Company’s Current Report on Form 8-K, filed on December 20, 2017.
    8. Incorporated
    by reference from the Company’s Quarterly Report on Form 10-Q, filed on November 19, 2018.
    9. Incorporated
    by reference from the Company’s Current Report on Form 8-K, filed on March 14, 2019.
    10. Incorporated
    by reference to the Company’s Current Report on Form 8-K filed on July 9, 2019.
    11. Incorporated
    by reference to the Company’s Current Report on Form 8-K filed on December 4, 2019.
    12. Incorporated
    by reference to the Company’s Current Report on Form 8-K filed on January 31, 2020.
    13. Incorporated
    by reference to the Company’s Registration Statement on Form S-1 filed on August 30, 2019.
    14. Incorporated
    by reference to the Company’s Amended Registration Statement on Form S-1 filed on January 27, 2020.
    15. Incorporated
    by reference to the Company’s Current Report on Form 8-K filed on April 1, 2020.
    16. Incorporated
    by reference to the Company’s Current Report on Form 8-K filed on May 15, 2020.
    17. Incorporated
    by reference to the Company’s Quarterly Report on Form 10-Q filed on July 6, 2020.
    * Filed
    herewith.
    ** Furnished,
    not filed herewith.

    SIGNATURES

    Pursuant
    to the requirements of Section 12 of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed
    on its behalf by the undersigned, thereunto duly authorized.

    Date:
    19 de agosto de 2020
    GAUCHO
    GROUP HOLDINGS, INC.
    By: /s/
    Scott L. Mathis
    Scott
    L. Mathis
    Chief
    Executive Officer
    By: /s/
    Maria Echevarria
    Maria
    Echevarria
    Chief
    Financial Officer and Chief Operating Officer

    Exhibit
    31.1

    CERTIFICATION
    PURSUANT TO RULE 13a-14(a) OF THE
    SECURITIES EXCHANGE ACT OF 1934

    I,
    Scott L. Mathis, certify that:

    1. yo
    have reviewed this quarterly report on Form 10-Q of Gaucho Group Holdings, 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. los
    registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and
    procedures (as defined in Exchange Act Rules 13a-15(e) 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 caused 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; y
    (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;
    y

    5. los
    registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of 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) Todas
    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; y
    (b) Alguna
    fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s
    internal control over financial reporting.

    agosto
    19, 2020
    /s/
    Scott L. Mathis
    Name: Scott
    L. Mathis
    Title: Chief
    Executive Officer
    (Principal
    Executive Officer)

    Exhibit
    31.2

    CERTIFICATION
    PURSUANT TO RULE 13a-14(a) OF THE
    SECURITIES EXCHANGE ACT OF 1934

    I,
    Maria Echevarria, certify that:

    1. yo
    have reviewed this quarterly report on Form 10-Q of Gaucho Group Holdings, 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. los
    registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and
    procedures (as defined in Exchange Act Rules 13a-15(e) 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 caused 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; y
    (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;
    y

    5. los
    registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of 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) Todas
    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; y
    (b) Alguna
    fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s
    internal control over financial reporting.

    agosto
    19, 2020
    /s/
    Maria Echevarria
    Name: Maria
    I. Echevarria
    Title: Chief
    Financial Officer
    (Principal
    Accounting Officer)

    Exhibit
    32

    CERTIFICATION
    PURSUANT TO

    18
    U.S.C. §1350,

    COMO
    ADOPTED PURSUANT TO

    SECTION
    906 OF THE SARBANES-OXLEY ACT OF 2002

    En
    connection with the Quarterly Report of Gaucho Group Holdings, Inc. (the “Company’s Quarterly Report”) on Form
    10-Q for the period ended June 30, 2020, as filed with the Securities and Exchange Commission on the date hereof (the “Report”),
    Scott L. Mathis, as Chief Executive Officer and principal executive officer and Maria I. Echevarria, as Chief Financial Officer
    and principal financial officer of the Company hereby certify, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section
    906 of the Sarbanes-Oxley Act of 2002, to the best of the undersigned’s knowledge and belief, that:

    1. los
    Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities
    Exchange Act of 1934, as amended; y

    2. Información
    contained in the Report fairly presents, in all material respects, the financial condition
    and results of operations of the Company as of the dates and for the periods expressed
    in the Report.

    /s/
    Scott L. Mathis
    Scott
    L. Mathis
    Chief
    Executive Officer and Principal Executive Officer
    Dated:
    19 de agosto de 2020
    /s/
    Maria I. Echevarria
    Maria
    I. Echevarria
    Chief
    Financial Officer and Principal Financial Officer
    Dated:
    19 de agosto de 2020

    Esta
    certification accompanies this Report pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 and shall not be deemed filed
    by the Company for purposes of Section 18 of the Securities Exchange Act of 1934, as amended.

    Fuente

    Descargo de responsabilidad

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