MYRIAD INTERACTIVE MEDIA, INC. - 10-Q - Management's Discussion and Analysis of Financial Condition and Results of Operations
(Edgar Glimpses Via Acquire Media NewsEdge) Forward-Looking Statements
Certain statements, other than purely historical information, including
estimates, projections, statements relating to our business plans, objectives,
and expected operating results, and the assumptions upon which those statements
are based, are "forward-looking statements." These forward-looking statements
generally are identified by the words "believes," "project," "expects,"
"anticipates," "estimates," "intends," "strategy," "plan," "may," "will,"
"would," "will be," "will continue," "will likely result," and similar
expressions. Forward-looking statements are based on current expectations and
assumptions that are subject to risks and uncertainties which may cause actual
results to differ materially from the forward-looking statements. Our ability to
predict results or the actual effect of future plans or strategies is inherently
uncertain. Factors which could have a material adverse affect on our operations
and future prospects on a consolidated basis include, but are not limited to:
changes in economic conditions, legislative/regulatory changes, availability of
capital, interest rates, competition, and generally accepted accounting
principles. These risks and uncertainties should also be considered in
evaluating forward-looking statements and undue reliance should not be placed on
such statements. Further information concerning our business, including
additional factors that could materially affect our financial results, is
included herein and in our other filings with the SEC.
Management's Discussion and Analysis of Financial Condition and Results of
Description of Business
We are a Delaware corporation formed on July 13, 1999. Our principal executive
offices are located at 7 Ingram Drive, Suite 128, Toronto, Ontario, Canada M6M
2L7. Our telephone number is 1-800-427-1103. On July 6, 2011, we changed our
name to Myriad Interactive Media, Inc. We are currently focused on building in
house applications and technologies that the company wholly owns and can drive
revenue streams from.
Mingle Suite Application
On September 19, 2012, we entered into an Agreement with Kalim Kahn to acquire
all rights to a social media software application known as "The Mingle Suite
Application." The closing date on the acquisition was October 1, 2012. The
Mingle Suite Application is a unique social media application that combines
popular social media networks like Facebook, Twitter, Google+ and YouTube into
one place. This will allow for seamless integration and ease of use for
corporate clients looking for both an all-in-one solution for social media
management, and a unique search engine optimization tool equipped with
sophisticated analytics. The application was developed over a year ago, and it
is comparable to other popular social media platforms like HootSuite, Vitrue,
Buddy Media & Radian6.
Our Agreement calls for a total purchase price of $250,000 to be paid for the
Mingle Suite Application. The purchase price shall be paid as follows:
Issuance of 5,000,000 shares of our common stock, to be valued at $75,000; and
Issuance of a Promissory Note in the amount of $175,000, payable on or before
October 1, 2014.
Our obligation to repay the Note in full was conditional upon the seller
generating a minimum of $500,000 in sales of the Mingle Suite Application on or
before the due date of October 1, 2014. The seller has subsequently released us
of all obligation under the Note.
We have successfully developed a mobile technology that allows users to share
uploaded social content to their social media networks in exchange for receiving
loyalty points. These loyalty points are redeemable within the app and utilized
towards goods and services that are sold by the end-client. The enterprise style
application is a mobile application that is custom brandable for
small-to-medium-sized enterprises and offers a wide array of mobile features. As
a compliment to this technology, we acquired a back-end technology from Brazo
River Technologies, Inc. that tracks social engagement and utilizes various
social media application programming interfaces (API's). We felt it was much
more cost effective to acquire this technology and re-integrate it than build it
from scratch. As part of the acquisition from Brazo River, we acquired the
"MyMobiPoints.com" brand name.
We paid a finder's fee to Ticker Logix, Inc. in connection with this
transaction. Ticker Logix is our biggest client and previously Mr. Ivany sat on
the board to ensure that we were protected in regard our original development
contract. After Myriad successfully developed the technologies for Ticker Logix,
Mr. Ivany resigned, as Myriad's accounts payable were received.
On February 24, 2014, we launched a website platform called CryptoCafe which is
a new and used marketplace to sell items in exchange for Bitcoins. We built a
proprietary escrow system to allow users to securely complete transactions and
rate feedback. On March 24, 2014, we began re-development of the website and new
back-end integration allowing for alternative cryptocoin coin integrations. On
April 14, 2014 we successfully launched the new version of CryptoCafe, which
includes the acceptance of Dogecoin, another popular crypto-coin.
On March 4, 2014 we launched a web platform to track publicly traded companies
that are in the Bitcoin space called the Bitcoin Stock Index. This website
calculates the respected values of each company traded in the USA that is
primarily focused on bitcoin or cryptocoin related developments. The company
values are weighed into a basket and displayed as one total price representing
the index value. The website also serves as a marketing platform to further
promote our other business ventures and to derive advertising revenue.
On April 16, 2014, we announced a partnership with Dr. Reiner Knizia, a world
famous game designer from Germany. We are currently working on development of a
mobile game that has previously been invented by Dr. Knizia. We have signed a
contract for the rights to this game and will pay Knizia Games royalties on
future sales. As compensation to Dr. Knizia, we issued 500,000 shares of common
stock. In addition, Dr. Knizia will receive royalties equal to 2/7 of any net
sales revenue from the game.
Results of operations for the three months ended March 31, 2014 and 2013.
During the three months ended March 31, 2014, we earned revenue of $31,676. We
incurred operating expenses in the amount of $172,388 for the three months ended
March 31, 2014, consisting of professional fees in the amount of $62,722,
general and administrative expenses of $24,093, depreciation and amortization of
$28,202, and stock-based compensation of $57,371. In addition, we incurred
interest expense of $12,525, a loss on debt settlement of $93,461, an
amortization of debt discount expense of $59,696, a change in the fair value of
derivative liability, leading to income of $248,490, a derivative expense of
$212,228, and a loss on foreign currency adjustment of $1,426. As a result, we
incurred a net loss of $271,558 for the three months ended March 31, 2014. By
comparison, for the three months ended March 31, 2013, we earned revenue of
$46,894. We incurred operating expenses of $68,268 during the three months
ended March 31, 2013, consisting of professional fees in the amount of $41,623,
general and administrative expenses of $25,482, and depreciation and
amortization of $1,163. We incurred a net loss of $24,333 during the three
months ended March 31, 2013.
Results of operations for the nine months ended March 31, 2014 and 2013.
During the nine months ended March 31, 2014, we earned revenue of $69,725. We
incurred operating expenses in the amount of $423,453 for the nine months ended
March 31, 2014, consisting of professional fees in the amount of $186,074,
general and administrative expenses of $83,679, depreciation of $75,335, and
stock based compensation of $78,365. In addition, we incurred interest expense
of $19,323, a gain on debt settlement of $76,254, an amortization of debt
discount expense of $155,332, a change in the fair value of derivative
liability, leading to income of $246,352, a derivative expense of $268,348, and
a loss on foreign currency adjustment of $5,377. As a result, we incurred a net
loss of $479,502 for the nine months ended March 31, 2014. By comparison, for
the nine months ended March 31, 2013, we earned revenue of $52,927. We incurred
operating expenses of $377,979 during the nine months ended March 31, 2013,
consisting of professional fees in the amount of $299,785 and general and
administrative expenses of $76,515, and depreciation of $1,679. In addition, we
incurred interest expense of $4,384, a decrease in the fair value of derivative
liability, leading to income of $29,065, and a derivative expense of $52,740.
We incurred a net loss of $353,111 during the nine months ended March 31, 2013.As we go forward with development and deployment of our lines of business, we
anticipate that both our expenses and our revenues will increase substantially
over the course of the next 12 to 18 months.
Liquidity and Capital Resources
As of March 31, 2014, we had total current assets of $17,670, consisting of cash
in the amount of $14,920, deposits in the amount of $950, prepaid expenses in
the amount of $1,800, and $-0- in accounts receivable. As March 31, 2014, we
had current liabilities of $104,101, consisting of accounts payable and accrued
expenses in the amount of $68,091, a payable due to a shareholder in the amount
of $17,272, and a derivative liability of $18,738. Accordingly, we had a
working capital deficit of $86,431 as of March 31, 2014. We have not attained
profitable operations and are dependent upon obtaining financing to pursue
significant development and expansion of our planned search engine and social
media marketing business. We will need to raise approximately $250,000 in new
capital in the short-term to put together a working environment for our team to
assemble together for efficient production and growth. Although we are engaged
in efforts to raise additional equity capital, we currently do not have any firm
arrangements for the required equity financing and we may not be able to obtain
such financing when required, in the amount necessary, or on terms that are
Off Balance Sheet Arrangements
As of March 31, 2014, there were no off balance sheet arrangements.
We have not attained profitable operations and are dependent upon obtaining
financing to pursue significant business development activities. We have a
cumulative deficit of $12,821,948 since our inception and require capital for
our contemplated operational and marketing activities to take place. Our ability
to raise additional capital through the future issuances of the common stock is
unknown. The obtainment of additional financing, the successful development of
our contemplated plan of operations, and our transition, ultimately, to the
attainment of profitable operations are necessary for us to continue operations.
For these reasons, our auditors stated in their report that they have
substantial doubt we will be able to continue as a going concern.
Critical Accounting Policies
In December 2001, the SEC requested that all registrants list their most
"critical accounting polices" in the Management Discussion and Analysis. The SEC
indicated that a "critical accounting policy" is one which is both important to
the portrayal of a company's financial condition and results, and requires
management's most difficult, subjective or complex judgments, often as a result
of the need to make estimates about the effect of matters that are inherently
uncertain. Currently, we do not believe that any accounting policies fit this
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