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Table of Contents

 

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

 

FORM 10-Q

 

(Mark One)
   
x QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
   
For the quarterly period ended August 31, 2023
   
o TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

 

For the transition period from ______to______

 

Commission File Number: 000-54163

 

The Marquie Group, Inc.
(Exact name of registrant as specified in its Charter)

  

Florida   26-2091212

(State or other jurisdiction of

incorporation or organization)

  (I.R.S. Employee Identification No.)
     

7901 4th ST N, Suite 4000

St. Petersburg, FL 33702

  33702
(Address of principal executive office)   (Zip Code)

 

(800) 351-3021

(Registrant’s telephone number, including area code)

 

Not Applicable

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

 

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

 

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

 

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

 

Large accelerated Filer ☐ Accelerated Filer ☐
Non-accelerated Filer ☒ Smaller reporting company 
  Emerging growth company 

 

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to section 13(a) of the Exchange Act. ☐

 

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

 

Indicate the number of shares outstanding of each of the issuer’s classes of common stock as of the latest practicable date: As of October 17, 2023, there were 756,612,000 shares of $0.0001 par value common stock, issued and outstanding.

 

 

   

 

 

TABLE OF CONTENTS

 

PART I: FINANCIAL INFORMATION  
   
Item 1: Financial Statements 3
Item 2: Management’s Discussion and Analysis of Financial Condition and Results of Operation 18
Item 3: Quantitative and Qualitative Disclosures about Market Risk 21
Item 4: Controls and Procedures 22
   
PART II: OTHER INFORMATION  
   
Item 1: Legal Proceedings 23
Item 1A: Risk Factors 23
Item 2: Unregistered Sales of Equity Securities and Use of Proceeds 23
Item 3: Defaults Upon Senior Securities 23
Item 4: Mine Safety Disclosures 23
Item 5: Other Information 23
Item 6: Exhibits 23
   
SIGNATURES 24

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 2 

 

 

PART I - FINANCIAL INFORMATION

 

Item 1.  Financial Statements

 

THE MARQUIE GROUP, INC.

(formerly Music of Your Life, Inc.)

Consolidated Balance Sheets

 

           
   August 31,   May 31, 
   2023   2023 
   (Unaudited)     
ASSETS          
CURRENT ASSETS          
           
Cash and cash equivalents  $117   $ 
           
Total Current Assets   117     
           
OTHER ASSETS          
           
Investment in Acquisition   6,200,000    6,200,000 
Loans receivable, related party   28,247    28,247 
Music inventory, net of accumulated depreciation of $20,949 and $20,719, respectively   699    929 
Trademark costs   10,365    10,365 
           
Total Other Assets   6,239,311    6,239,541 
           
TOTAL ASSETS  $6,239,428   $6,239,541 
           
LIABILITIES AND STOCKHOLDERS' DEFICIT          
           
CURRENT LIABILITIES          
           
Bank overdraft  $   $46 
Accounts payable   67,639    50,664 
Accrued interest payable on notes payable   666,491    578,017 
Accrued consulting fees   1,205,917    1,145,917 
Notes payable, net of debt discounts of $42,669 and $66,794, respectively   1,489,263    1,465,138 
Notes payable to related parties   2,091,272    2,090,772 
Derivative liability   492,775    1,035,998 
           
Total Current Liabilities   6,013,357    6,366,552 
           
TOTAL LIABILITIES   6,013,357    6,366,552 
           
STOCKHOLDERS' DEFICIT          
           
Preferred Stock, $0.0001 par value; 20,000,000 shares authorized, 200 and 200 shares issued and outstanding        
Common stock, $0.0001 par value; 50,000,000,000 shares authorized, 756,612,000 and 756,612,000 shares issued and outstanding, respectively   75,663    75,663 
Common stock payable - 1 share   8,460    8,460 
Additional paid-in-capital   14,486,896    14,486,896 
Accumulated deficit   (14,344,948)   (14,698,030)
           
Total Stockholders' Deficit   226,071    (127,011)
           
TOTAL LIABILITIES AND STOCKHOLDERS' DEFICIT  $6,239,428   $6,239,541 

 

The accompanying notes are an integral part of these financial statements

 

 3 

 

 

THE MARQUIE GROUP, INC.

(formerly Music of Your Life, Inc.)

Consolidated Statements of Operations

(Unaudited)

 

 

           
   For the Three Months Ended 
   August 31, 
   2023   2022 
         
NET REVENUES  $   $ 
           
OPERATING EXPENSES          
           
Accrued Salaries and Consulting fees   60,000    60,000 
Professional fees   16,976    38,121 
Other selling, general and administrative   567    1,305 
           
Total Operating Expenses   77,543    99,426 
           
LOSS FROM OPERATIONS   (77,543)   (99,426)
           
OTHER INCOME (EXPENSES)          
           
Income (expense) from derivative liability   543,223    41,194 
Interest expense (including amortization of debt discounts of $24,125, and $14,878, respectively)   (112,598)   (53,208)
           
Total Other Income (Expenses)   430,625    (12,014)
           
INCOME (LOSS) BEFORE INCOME TAXES   353,082    (111,440)
           
INCOME TAX EXPENSE        
           
NET INCOME (LOSS)  $353,082   $(111,440)
           
BASIC AND DILUTED:          
Net income (loss) per common share  $0.00   $(0.01)
           
Weighted average shares outstanding   756,612,000    16,192,332 

 

The accompanying notes are an integral part of these financial statements

 

 

 

 

 

 

 

 

 4 

 

 

THE MARQUIE GROUP, INC.

(formerly Music of Your Life, Inc.)

Consolidated Statements of Stockholders' Deficit

(Unaudited)

 

 

                                         
   Three Months Ended August 31, 2023 
   Preferred Stock   Common Stock   Common Stock   Additional   Accumulated   Total Stockholders' 
   Shares   Amount   Shares   Amount   Payable   Paid-in Capital   Deficit   Deficit 
                                 
Balance, May 31, 2023   200   $    756,612,000   $75,663   $8,460   $14,486,896   $(14,698,030)  $(127,011)
                                         
Net income for the three months ended August 31, 2023                           353,082    353,082 
                                         
Balance, August 31, 2023   200   $    756,612,000   $75,663   $8,460   $14,486,896   $(14,344,948)  $226,071 

 

 

   Three Months Ended August 31, 2022 
   Preferred Stock   Common Stock   Common Stock   Additional   Accumulated   Total Stockholders' 
   Shares   Amount   Shares   Amount   Payable   Paid-in Capital   Deficit   Deficit 
                                 
Balance, May 31, 2022   200   $    16,189,732   $1,621   $8,460   $10,213,431   $(15,878,189)  $(5,654,677)
                                         
Round up of shares from reverse stock split           2,600                     
                                         
Net loss for the three months ended August 31, 2022                           (111,440)   (111,440)
                                         
Balance, August 31, 2022   200   $    16,192,332   $1,621   $8,460   $10,213,431   $(15,989,629)  $(5,766,117)

 

The accompanying notes are an integral part of these financial statements

 

 

 5 

 

 

THE MARQUIE GROUP, INC.

(formerly Music of Your Life, Inc.)

Consolidated Statements of Cash Flows

(Unaudited)

 

 

           
   For the Three Months Ended 
   August 31, 
   2023   2022 
         
CASH FLOWS FROM OPERATING ACTIVITIES:          
           
Net income (loss)  $353,082   $(111,440)
Adjustments to reconcile net income (loss) to net cash used by operating activities:          
Depreciation of music inventory   230    389 
Income from derivative liability   (543,223)   (41,194)
Amortization of debt discounts   24,125    14,878 
Changes in operating assets and liabilities:          
Accounts payable   16,975    20,421 
Accrued interest payable on notes payable   88,474    34,451 
Accrued consulting fees   60,000    55,700 
           
Net Cash Used by Operating Activities   (337)   (26,795)
           
CASH FLOWS FROM INVESTING ACTIVITIES:        
           
CASH FLOWS FROM FINANCING ACTIVITIES:          
           
Bank overdraft   (46)   62 
Proceeds from notes payable       38,880 
Repayments of notes payable to related parties       (12,500)
Proceeds from notes payable to related parties   500     
           
Net Cash Provided by Financing Activities   454    26,442 
           
NET INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS   117    (353)
           
CASH AND CASH EQUIVALENTS, BEGINNING OF PERIOD       353 
           
CASH AND CASH EQUIVALENTS, END OF PERIOD  $117   $ 
           
SUPPLEMENTAL CASH FLOW INFORMATION          
           
Cash Payments For:          
Interest  $   $ 
Income taxes  $   $ 
           
Non-cash investing and financing activities:          
Initial derivative liability charged to debt discounts  $   $38,880 

 

The accompanying notes are an integral part of these financial statements

 

 

 

 6 

 

 

THE MARQUIE GROUP, INC.

(formerly Music of Your Life, Inc.)

Notes to the Consolidated Financial Statements

August 31, 2023

 

 

NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES AND ORGANIZATION

 

Basis of Presentation

 

The accompanying unaudited financial statements are presented in accordance with generally accepted accounting principles for interim financial information and the instructions to Form 10-Q and Article 8 of Regulation S-X. Accordingly, they do not include all of the information and footnotes required by generally accepted accounting principles for complete financial statements. In the opinion of management, all adjustments (consisting only of normal recurring accruals) considered necessary in order to make the financial statements not misleading, have been included. Operating results for the three months ended August 31, 2023 are not necessarily indicative of results that may be expected for the year ending May 31, 2024. 

 

Organization

 

The Marquie Group, Inc. (formerly Music of Your Life, Inc.) (the “Company”) was incorporated under the laws of the State of Florida on January 30, 2008 under the name of “Zhong Sen International Tea Company”. From January 2008 to May 2013, the Company operated with the principal business objective of providing sales and marketing consulting services to small to medium sized Chinese tea producing companies who wished to export and distribute high quality Chinese tea products worldwide. On May 31, 2013 (the “Closing Date”), the Company entered into a Merger Agreement (the “Merger Agreement”) by and among the Company, Music of Your Life, Inc., a Nevada corporation (“MYL Nevada”) incorporated October 10, 2012, and Music of Your Life Merger Sub, Inc., a Utah corporation ("Merger Sub"), pursuant to which MYL Nevada merged with Merger Sub. As a result of the merger, MYL Nevada became a wholly owned subsidiary of the Company, and on July 26, 2013, the Company changed its name to Music of Your Life, Inc., a syndicated radio network. On May 20, 2014 the Company acquired 100% of the outstanding stock of iRadio, Inc., a Utah corporation. The Company was the surviving corporation. iRadio was an entity related to the Company by common ownership.

 

Acquisition of The Marquie Group, Inc.

 

On August 16, 2018 (see Note 8), the Company merged with The Marquie Group, Inc. (“TMGI”) in exchange for the issuance of a total of 100 shares of our common stock to TMGI’s stockholders. Following the merger, the Company had 102 shares of common stock issued and outstanding. On December 5, 2018, the Company amended and restated its Articles of Incorporation providing for a change in the Company’s name from “Music of Your Life, Inc.” to “The Marquie Group, Inc.” The TMGI business plan is to license, develop and launch a direct-to-consumer, health and beauty product line called “Whim” that use innovative formulations of plant-based, amino-acids and other natural alternatives to chemical ingredients.

 

NOTE 2 - MUSIC INVENTORY

 

Music inventory consisted of the following: 

          
   August 31, 2023   May 31, 2023 
Digital music acquired for use in operations – at cost  $21,648   $21,648 
Accumulated depreciation   (20,949)   (20,719)
Music inventory – net  $699   $929 

 

 

 

 7 

 

 

THE MARQUIE GROUP, INC.

(formerly Music of Your Life, Inc.)

Notes to the Consolidated Financial Statements

August 31, 2023

 

 

The Company purchases digital music to broadcast over the radio and internet. During the three months ended August 31, 2023, the Company purchased $-0- worth of music inventory. For the three months ended August 31, 2023 and 2022, depreciation of music inventory was $230 and $389, respectively.

 

NOTE 3 – ACCRUED CONSULTING FEES

 

Accrued consulting fees consisted of the following: 

          
   August 31, 2023   May 31, 2023 
Due to Company Chief Executive Officer pursuant to Consulting Agreement dated March 1, 2017 – monthly compensation of $10,000 to May 31, 2022, increased to $20,000 after May 31, 2022  $548,817   $488,817 
Due to wife of Company Chief Executive Officer pursuant to consulting agreement effective August 16, 2018 – monthly compensation of $15,000 (which was terminated May 31, 2021)   305,200    305,200 
Due to mother of Company Chief Executive Officer pursuant to Consulting Agreement dated September 1, 2015 (which was terminated November 30, 2019) – monthly compensation of $5,000 to November 30, 2019   131,350    131,350 
Due to service provider pursuant to Consulting Agreement dated September 1, 2015 (which was terminated February 28, 2019) – monthly compensation of $5,000 to February 28, 2019   144,700    144,700 
Due to service provider pursuant to Consulting Agreement dated September 1, 2015 (which was terminated November 30, 2019) – monthly compensation of $1,000 to November 30, 2019   48,000    48,000 
Due to two other service providers   27,850    27,850 
           
Total  $1,205,917   $1,145,917 

 

The accrued consulting fees balance changed as follows: 

          
   Three Months Ended
August 31, 2023
   Year Ended
May 31, 2023
 
Balance, beginning of period  $1,145,917   $926,217 
           
Compensation expense accrued pursuant to consulting agreements   60,000    240,000 
Payments to consultants       (20,300)
           
Balance, end of period  $1,205,917   $1,145,917 

 

See Note 8 (Commitments and Contingencies).

 

 

 

 8 

 

 

THE MARQUIE GROUP, INC.

(formerly Music of Your Life, Inc.)

Notes to the Consolidated Financial Statements

August 31, 2023

 

 

NOTE 4 - NOTES PAYABLE

 

Notes payable consisted of the following:

          
   August 31, 2023   May 31, 2023 
Notes payable to an entity, non-interest bearing, due on demand, unsecured  $64,700   $64,700 
Note payable to an individual, due on May 22, 2015, in default (B)   25,000    25,000 
Note payable to an entity, non-interest bearing, due on February 1, 2016, in default (D)   50,000    50,000 
Note payable to a family trust, stated interest of $2,500, due on October 31, 2015, in default (E)   7,000    7,000 
Note payable to a corporation, stated interest of $5,000, due on October 21, 2015, in default (G)   50,000    50,000 
Note payable to a corporation, stated interest of $5,000, due on November 6, 2015, in default (H)   50,000    50,000 
Note payable to an individual, due on December 20, 2015, in default, 24% default rate from January 20, 2016 (I)   25,000    25,000 
Convertible note payable to an entity, interest at 12%, due on December 29, 2016, in default (M)   40,000    40,000 
Note payable to a family trust, interest at 10%, due on November 30, 2016, in default (P)   25,000    25,000 
Convertible note payable to an individual, interest at 10%, due on demand (V)   46,890    46,890 
Convertible note payable to an individual, interest at 8%, due on demand (W)   29,000    29,000 
Convertible note payable to an individual, interest at 8%, due on demand (X)   21,500    21,500 
Convertible note payable to an entity, interest at 10%, due on demand (Y)   8,100    8,100 
Convertible note payable to an entity, interest at 10%, due on March 5, 2019, in default (DD)   35,000    35,000 
Convertible note payable to an entity, interest at 10%, due on September 18, 2019, in default (GG)   8,505    8,505 
Convertible note payable to an entity, interest at 12%, due on November 30, 2021, in default, net of discount of $-0- and $85,233, respectively (SS)   154,764    154,764 
Convertible note payable to an entity, interest at 10%, due on June 4, 2022, in default (VV)   170,212    170,212 
Convertible note payable to an entity, interest at 8%, due on August 27, 2022, in default (WW)   14,000    14,000 
Convertible note payable to an entity, interest at 12%, due on December 21, 2022, in default (YY)   58,250    58,250 
Convertible note payable to an entity, interest at 12%, due on February 8, 2023, in default (ZZ)   245,000    245,000 
Convertible note payable to an entity, interest at 12%, due on June 10, 2023, in default, net of discount of $-0- and $1,065, respectively (AA)   38,880    37,815 
Convertible note payable to an entity, interest at 12%, due on November 4, 2023, net of discount of $5,441 and $13,143, respectively (C)   25,114    17,412 
Convertible note payable to an entity, interest at 12%, due on April 10, 2024, net of discount of $37,228 and $52,586, respectively (F)   23,872    8,514 
Note payable to the Small Business Administration under the Payroll Protection Program, interest at 1%, due in installments through May 4, 2022, forgivable in part or whole subject to certain requirements   70,000    70,000 
Note payable to the Small Business Administration under the Payroll Protection Program, interest at 1%, due in installments through April 5, 2023, forgivable in part or whole subject to certain requirements   100,000    100,000 
Notes payable to individuals, non-interest bearing, due on demand   103,476    103,476 
Total Notes Payable   1,489,263    1,465,138 
Less: Current Portion   (1,489,263)   (1,465,138)
Long-Term Notes Payable  $   $ 

 

(B) On April 22, 2015, the Company issued a $25,000 Promissory Note, non-interest bearing (interest at 24% per annum after May 22, 2015), due at maturity on May 22, 2015.

 

(D) On July 24, 2015, the Company issued a $50,000 Promissory Note to Kodiak Capital Group, LLC (“Kodiak”) for services rendered in association with an Equity Purchase Agreement. As amended and restated January 4, 2016, the note is non-interest bearing and was due on February 1, 2016.

 

 

 9 

 

 

THE MARQUIE GROUP, INC.

(formerly Music of Your Life, Inc.)

Notes to the Consolidated Financial Statements

August 31, 2023

 

 

(E) On July 31, 2015, the Company issued a $25,000 Promissory Note with a stated interest amount of $2,500 due at maturity on October 31, 2015.

 

(G) On August 6, 2015, the Company issued a $50,000 Promissory Note with a stated interest amount of $5,000 due at maturity on October 21, 2015.

 

(H) On August 21, 2015, the Company issued a $50,000 Promissory Note with a stated interest amount of $5,000 due at maturity on November 6, 2015.

 

(I) On September 21, 2015, the Company issued a $25,000 Promissory Note with a stated interest amount of $2,500 due at maturity on December 20, 2015. In the event that all principal and interest are not paid to the lender by January 20, 2016, interest is to accrue at a rate of 24% per annum commencing on January 21, 2016.

 

(M) On December 29, 2015, the Company issued a $20,000 Convertible Promissory Note to a lender for net loan proceeds of $15,000. The note bears interest at a rate of 12% per annum, was due on December 29, 2016, and is convertible at the option of the lender into shares of the Company common stock at a Conversion Price equal to 50% of the lowest closing bid price during the 30 Trading Day period prior to the Conversion Date. See Note 6 (Derivative Liability).

 

(P) On June 3, 2016, the Company issued a $25,000 Promissory Note. The note bears interest at a rate of 10% per annum and was due on November 30, 2016.

 

(V) On May 3, 2017, the Company issued a $72,750 Convertible Promissory Note to a lender as a replacement for the principal and interest due on a promissory note due on October 14, 2014. The note bears interest at a rate of 10% per annum, is due on demand, and is convertible at the option of the lender into shares of the Company common stock at a Conversion Price equal to $0.1293 per share.

 

(W) On April 5, 2017, the Company issued a $35,000 Convertible Promissory Note to a lender as a replacement for the principal and interest due on a promissory note due on August 23, 2015. The note bears interest at a rate of 8% per annum, is due on demand, and is convertible at the option of the lender into shares of the Company common stock at a Conversion Price equal to 40% of the lowest Trading Price during the 5 Trading Day period prior to the Conversion Date. See Note 6 (Derivative Liability).

 

(X) On April 5, 2017, the Company issued a $27,500 Convertible Promissory Note to a lender as a replacement for the principal and interest due on a promissory note due on October 31, 2015. The note bears interest at a rate of 8% per annum, is due on demand, and is convertible at the option of the lender into shares of the Company common stock at a Conversion Price equal to 40% of the lowest Trading Price during the 5 Trading Day period prior to the Conversion Date. See Note 6 (Derivative Liability).

 

(Y) On March 1, 2017, the Company issued a $8,600 Convertible Promissory Note to a vendor of the Company to convert certain accounts payable due to the vendor. The note bears interest at a rate of 10% per annum, is due on demand, and is convertible at the option of the lender into shares of the Company common stock at a Conversion Price equal to the higher of $0.04 per share or 60% of the lowest Trading Price during the 5 Trading Day period prior to the Conversion Date.

 

 

 

 10 

 

 

THE MARQUIE GROUP, INC.

(formerly Music of Your Life, Inc.)

Notes to the Consolidated Financial Statements

August 31, 2023

 

 

(DD) On March 5, 2018, the Company issued a $35,000 Convertible Promissory Note to a lender for net loan proceeds of $33,000. The note bears interest at a rate of 10% per annum, was due on March 5, 2019, and is convertible at the option of the lender into shares of the Company common stock at a Conversion Price equal to 50% of the lowest Trading Price during the 20 Trading Day period prior to the Conversion Date. See Note 6 (Derivative Liability).

 

(GG) On September 18, 2018, the Company issued a $18,000 Convertible Promissory Note to a lender for net loan proceeds of $14,000. The note bears interest at a rate of 10% per annum, was due on September 18, 2019, and is convertible at the option of the lender into shares of the Company common stock at a Conversion Price equal to 50% of the lowest Trading Price during the 20 Trading Day period prior to the Conversion Date. See Note 6 (Derivative Liability).

 

(SS) On November 30, 2020, the Company issued a $170,000 Convertible Promissory Note to a lender which paid off some of the accrued interest for the note described in (RR) above. The Company received net proceeds of $32,500. The note bears interest at a rate of 12% per annum, is due on November 30, 2021, and is convertible at the option of the lender into shares of the Company common stock at a Conversion Price equal to the lesser of (1) 105% of the closing bid price of the Common Stock on the Issue Date, or (2) the closing bid price of the Common Stock on the Trading Day immediately preceding the date of the conversion. See Note 6 (Derivative Liability).

 

(VV) On June 4, 2021, the Company issued a $238,596 Convertible Promissory Note to a lender which paid off the principal and accrued interest for the notes described in (EE), (FF), (KK), (LL), (MM), (NN) and (PP) above. The note bears interest at a rate of 10% per annum, is due on June 4, 2022, and is convertible at the option of the lender into shares of the Company common stock at a Conversion Price equal to the lesser of (1) $0.00004, or (2) 50% of the lowest trading price of the common stock for the previous 15 day trading period. See Note 6 (Derivative Liability).

 

(WW) On August 27, 2021, the Company issued a $14,000 Convertible Promissory Note to a lender for net loan proceeds of $10,000. The note bears interest at a rate of 8% per annum, is due on August 27, 2022, and is convertible at the option of the lender into shares of the Company common stock at a Conversion Price equal to 65% of the lowest trading price in the 10 Trading Day period prior to the Conversion Date. See Note 6 (Derivative Liability).

 

(YY) On December 21, 2021, the Company issued a $58,250 Convertible Promissory Note to a lender for net loan proceeds of $49,925. The note bears interest at a rate of 12% per annum, is due on December 21, 2022, and is convertible at the option of the lender into shares of the Company common stock at a Conversion Price equal to the higher of (1) $0.10, or (2) the par value of the Common Stock.

 

(ZZ) On February 8, 2022, the Company issued a $245,000 Convertible Promissory Note to a lender for net loan proceeds of $218,000. The note bears interest at a rate of 12% per annum, is due on February 8, 2023, and is convertible at the option of the lender into shares of the Company common stock at a Conversion Price equal to the higher of (1) $0.10, or (2) the par value of the Common Stock.

 

(AA) On June 10, 2022, the Company issued a $38,880 Convertible Promissory Note to a lender for net loan proceeds of $31,800. The note bears interest at a rate of 12% per annum, is due on June 10, 2023, and is convertible at the option of the lender into shares of the Company common stock at a Conversion Price equal to the lower of (1) $0.05, or (2) 50% of the lowest trading price in the 10 Trading Day period prior to the Conversion Date. See Note 6 (Derivative Liability).

 

 

 

 11 

 

 

THE MARQUIE GROUP, INC.

(formerly Music of Your Life, Inc.)

Notes to the Consolidated Financial Statements

August 31, 2023

 

 

(C) On November 4, 2022, the Company issued a $30,555 Convertible Promissory Note to a lender for net loan proceeds of $25,000. The note bears interest at a rate of 12% per annum, is due on November 4, 2023, and is convertible at the option of the lender into shares of the Company common stock at a Conversion Price equal to the lower of (1) $0.005, or (2) 50% of the lowest trading price in the 10 Trading Day period prior to the Conversion Date. See Note 6 (Derivative Liability).

 

Concentration of Notes Payable:

 

The principal balance of notes payable was due to: 

          
   August 31, 2023   May 31, 2023 
         
Lender A  $458,014   $458,014 
Lender B   170,212    170,212 
14 other lenders   903,706    903,706 
           
Total   1,531,932    1,531,932 
           
Less debt discounts   (42,669)   (66,794)
           
Net  $1,489,263   $1,465,138 

 

NOTE 5 - NOTES PAYABLE – RELATED PARTIES

 

Notes payable – related parties consisted of the following: 

          
   August 31,
2023
   May 31,
2023
 
         
Note payable to Company law firm (and owner of 2,500 shares of common stock since August 16, 2018), non-interest bearing, due on demand, unsecured  $2,073   $2,073 
Notes payable to The OZ Corporation (owner of 2,500 shares of common stock since August 16, 2018), non-interest bearing, due on demand, unsecured   69,250    69,250 
Note payable to the Chief Executive Officer, non-interest bearing, due on demand, unsecured   19,949    19,449 
Note payable to the wife of the Chief Executive Officer as part of the 25% acquisition of Simply Whim, interest at 12%, due on September 20, 2023, unsecured (See Note 10)   2,000,000    2,000,000 
Total Notes Payable   2,091,272    2,090,772 
Less: Current Portion   (2,091,272)   (2,090,772)
Long-Term Notes Payable  $   $ 

 

 

 12 

 

 

THE MARQUIE GROUP, INC.

(formerly Music of Your Life, Inc.)

Notes to the Consolidated Financial Statements

August 31, 2023

 

 

NOTE 6 - DERIVATIVE LIABILITY

 

The derivative liability at August 31, 2023 and May 31, 2023 consisted of: 

                    
   August 31, 2023   May 31, 2023 
   Face Value   Derivative Liability   Face Value   Derivative Liability 
Convertible note payable issued December 29, 2015, due December 29, 2016 (M)  $40,000   $74,286   $40,000   $81,481 
Convertible note payable issued April 5, 2017, due on demand (W)   29,000    51,556    29,000    81,093 
Convertible note payable issued April 5, 2017, due on demand (X)   21,500    38,222    21,500    60,120 
Convertible note payable issued March 5, 2018, due on March 5, 2019 (DD)   35,000    65,000    35,000    71,296 
Convertible note payable issued September 18, 2018, due on September 18, 2019 (GG)   8,506    15,796    8,506    17,326 
Convertible note payable issued November 30, 2020, due on November 30, 2021 (SS)   154,764    33,979    154,764    151,020 
Convertible note payable issued June 4, 2021, due on June 4, 2022 (VV)   170,212    36,245    170,212    153,285 
Convertible note payable issued August 27, 2021, due on August 27, 2022 (WW)   14,000    16,769    14,000    18,707 
Convertible note payable issued June 10, 2022, due on June 10, 2023 (AA)   38,880    35,867    38,880    154,078 
Convertible note payable issued November 4, 2022, due on November 4, 2023 (C)   30,555    87,300    30,555    92,797 
Convertible note payable issued April 10, 2023, due on April 10, 2024 (F)   61,100    37,755    61,100    154,795 
                     
Totals  $603,517   $492,775   $603,517   $1,035,998 

 

The above convertible notes contain a variable conversion feature based on the future trading price of the Company common stock. Therefore, the number of shares of common stock issuable upon conversion of the notes is indeterminate. Accordingly, we have recorded the fair value of the embedded conversion features as a derivative liability at the respective issuance dates of the notes and charged the applicable amounts to debt discounts and the remainder to other expense. The increase (decrease) in the fair value of the derivative liability from the respective issuance dates of the notes to the measurement dates is charged (credited) to other expense (income). The fair value of the derivative liability of the notes is measured at the respective issuance dates and quarterly thereafter using the Black Scholes option pricing model.

 

 

 

 13 

 

 

THE MARQUIE GROUP, INC.

(formerly Music of Your Life, Inc.)

Notes to the Consolidated Financial Statements

August 31, 2023

 

 

Assumptions used for the calculations of the derivative liability of the notes at August 31, 2023 include (1) stock price of $0.001 per share, (2) exercise prices ranging from $0.00004 to $0.00045 per share, (3) terms ranging from 0 days to 223 days, (4) expected volatility of 2,193% and (5) risk free interest rates ranging from 5.52% to 5.61%.

 

Assumptions used for the calculations of the derivative liability of the notes at May 31, 2023 include (1) stock price of $0.0041 per share, (2) exercise prices ranging from $0.00004 to $0.001755 per share, (3) terms ranging from 0 days to 315 days, (4) expected volatility of 2,189% and (5) risk free interest rates ranging from 4.65% to 5.28%.

 

Concentration of Derivative Liability:

 

The derivative liability relates to convertible notes payable due to: 

          
   August 31, 2023   May 31, 2023 
         
Lender A  $33,979   $151,020 
Lender B   36,245    153,285 
Lender C   35,867    415,233 
Lender D   97,565    107,329 
5 other lenders   289,119    209,131 
           
Total  $492,775   $1,035,998 

 

 

 

 14 

 

 

THE MARQUIE GROUP, INC.

(formerly Music of Your Life, Inc.)

Notes to the Consolidated Financial Statements

August 31, 2023

 

 

NOTE 7 - EQUITY TRANSACTIONS

 

During the year ended May 31, 2021, the Company issued an aggregate of 4,304,842 shares of common stock for the conversion of notes payable and accrued interest in the aggregate amount of $835,050. We incurred a loss on the conversion of notes payable and accrued interest of $1,445,042, which represents the excess of the $2,280,092 fair value of the 4,304,842 shares at the dates of conversion over the $835,050 amount of debt satisfied.

 

Effective April 21, 2022, the Company effectuated a 1 for 1,000 reverse split of the Company’s Common Stock (“Reverse Split”), meaning that each 1,000 shares of Common Stock is consolidated into 1 share of Common Stock following the reverse split, provided however, that fractional shares would be rounded up to the nearest whole share. Following the Reverse Split, the Company had 16,192,332 common shares issued and outstanding. The accompanying financial statements have been retroactively adjusted to reflect this reverse stock split.

 

On October 13, 2022 (the “Closing Date”), the Company entered into a Standby Equity Commitment Agreement (the “Equity Agreement” by and among the Company, and MacRab, LLC, a Florida limited liability company ("MacRab"), pursuant to which MacRab has agreed to purchase at the Company’s sole discretion, up to five million dollars ($5,000,000) of the Company's common stock (the “Put Shares”) at a purchase price of 90% of the average of the two (2) lowest volume weighted average prices of the Company’s Common Stock on OTCQB during the six (6) Trading Days immediately following the Clearing Date.

 

Contemporaneous therewith, the Company and MacRab also entered into a Registration Rights Agreement, whereby the Company has agreed to provide certain registration rights under the Securities Act of 1933, as amended. Pursuant to the Registration Rights Agreement, the Company has registered the Put Shares pursuant in a registration statement on Form S-1 (the “Registration Statement”). The Registration Statement was filed on October 21, 2022.

 

Also on the Closing Date, pursuant to the Equity Agreement, the Company issued to MacRab a warrant (the “Warrant”) to acquire 11,764,706 shares of the Company’s common stock.

 

 

 

 15 

 

 

THE MARQUIE GROUP, INC.

(formerly Music of Your Life, Inc.)

Notes to the Consolidated Financial Statements

August 31, 2023

 

 

NOTE 8 - COMMITMENTS AND CONTINGENCIES

 

Consulting Agreements with Individuals

 

The Company has entered into Consulting Agreements with the Company’s Chief Executive Officer, the wife of the Company’s Chief Executive Officer, the mother of the Company’s Chief Executive Officer, and other service providers (see Note 3 – Accrued Consulting Fees). The Consulting Agreement with the Company’s Chief Executive Officer provided for monthly compensation of $10,000 through May 31, 2022 and was increased to $20,000 after May 31, 2022. The Consulting Agreement with the wife of the Company’s Chief Executive Officer provided for monthly compensation of $15,000 and expired on May 31, 2021. The Consulting Agreement with the mother of the Company’s Chief Executive Officer provided for monthly compensation of $5,000 and was terminated as of November 30, 2019. The other 3 consulting agreements provided for monthly compensation totaling $6,500 and were terminated as of November 30, 2019.

 

Corporate Consulting Agreement

 

On March 14, 2018, the Company executed a Corporate Consulting Agreement (the “Agreement”) with a consulting firm entity (the “Consultant”). The Agreement provided for the Consultant to perform certain investor relations and other services for the Company. The term of the Agreement was 4 months but the Agreement provided that the Company could terminate the Agreement for any reason at any time upon 5 days written prior notice. The Agreement provided for 8 payments of cash fees totaling $240,000 to be paid to the Consultant over 4 months.

 

On April 1, 2018, the Company notified the Consultant that the Agreement was terminated. A total of $25,000 was paid to the Consultant in March 2018 which was expensed and included in “Salaries and Consulting Fees” in the Consolidated Statement of Operations for the year ended May 31, 2018. No other amounts were paid or accrued subsequent to May 31, 2018.

 

On October 16, 2018 (see Note 7), the Company issued 5,000 shares of its common stock to the Consultant. On October 26, 2018, the Consultant advised the Company that it had not been notified that the Agreement was terminated on April 1, 2018 and that the Company is in default of the Agreement.

 

NOTE 9 - GOING CONCERN

 

The accompanying financial statements have been prepared assuming that the Company will continue as a going concern, which contemplates the realization of assets and satisfaction of liabilities in the normal course of business. At August 31, 2023, the Company had negative working capital of $6,013,240 and an accumulated deficit of $14,344,948. These factors raise substantial doubt regarding the Company’s ability to continue as a going concern.

 

 

 

 16 

 

 

THE MARQUIE GROUP, INC.

(formerly Music of Your Life, Inc.)

Notes to the Consolidated Financial Statements

August 31, 2023

 

 

To date the Company has funded its operations through a combination of loans and sales of common stock. The Company anticipates another net loss for the fiscal year ended May 31, 2024 and with the expected cash requirements for the coming year, there is substantial doubt as to the Company’s ability to continue operations.

 

The Company is attempting to improve these conditions by way of financial assistance through issuances of notes payable and additional equity and by generating revenues through sales of products and services. The financial statements do not include any adjustments that might result from the outcome of this uncertainty.

 

NOTE 10 – INVESTMENT IN ACQUISITION

 

On September 20, 2022, the Company entered into an agreement to acquire 25% of the outstanding shares of SIMPLY WHIM, INC., a Wyoming corporation (“SIMPLY WHIM”), in exchange for 666,666,668 shares of common stock of the Company and a promissory note in the face amount of $2,000,000. SIMPLY WHIM is a skin care product development company. At the date of the acquisition, the price per share of the company shares was $0.0063. The total consideration paid by the company (value of stock issued and promissory note) was $6,200,000 which has been recorded as Investment in Acquisition on the balance sheet.

 

 

 

 

 

 

 

 

 

 

 17 

 

 

Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operation

 

The following discussion contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934 relating to future events or our future performance. Actual results may materially differ from those projected in the forward-looking statements as a result of certain risks and uncertainties set forth in this prospectus. Although management believes that the assumptions made and expectations reflected in the forward-looking statements are reasonable, there is no assurance that the underlying assumptions will, in fact, prove to be correct or that actual results will not be different from expectations expressed in this report.

 

BUSINESS OVERVIEW

 

The Marquie Group, Inc. is an emerging direct-to-consumer firm specializing in product development and media, including a dynamic radio and digital network. We craft and promote top-tier health and beauty solutions that enrich lives, showcased through engaging radio content for our audience. We maintain a website at www.themarquiegroup.com. Our annual reports on Form 10-K, quarterly reports on Form 10-Q, current reports on Form 8-K, and any amendments to these reports are available free of charge through our website as soon as reasonably practicable after those reports are electronically filed with or furnished to the SEC. The information on our website is not a part of or incorporated by reference into this or any other report of the company filed with, or furnished to, the SEC.

 

We have three operating segments: (1) Broadcast, (2) Digital Media, and (3) Health and Beauty, which also qualify as reportable segments. Our operating segments reflect how we assess the performance of each operating segment and determine the appropriate allocations of resources to each segment. We continually review our operating segment classifications to align with operational changes in our business and may make changes as necessary.

 

We measure and evaluate our operating segments based on operating income and operating expenses that exclude costs related to corporate functions, such as accounting and finance, human resources, legal, tax and treasury. We also exclude costs such as amortization, depreciation, taxes, and interest expense when evaluating the performance of our operating segments.

 

Broadcasting

 

Our foundational business is radio broadcasting, which includes the ownership and operation of a syndicated radio network including our affiliated radio stations subscribing to our programming delivery.

 

Advertising revenue generated from our syndicated radio operations is reported as broadcast revenue in our Consolidated Financial Statements. Advertising revenue is recorded on a gross basis unless an agency represents the advertiser, in which case revenue is reported net of the commission retained by the agency.

 

Broadcast revenue is impacted by the rates radio stations can charge for programming and advertising time, the level of airtime sold to programmers and advertisers, the number of impressions delivered, or downloads made, and the number of listener responses in the case of pay-per-call. Advertising rates are based upon the demand for advertising time, which in turn is based on our stations’ and networks’ ability to produce results for their advertisers. We market ourselves to advertisers based on the responsiveness of our audiences. We do not subscribe to traditional audience measuring services for most of our radio stations.

 

Each of our radio station affiliates allocates 3 minutes per hour of advertising time for our commercials at a preset time every hour based on the Music of Your Life clock.

 

 

 

 18 

 

 

Our results are subject to seasonal fluctuations. As is typical in the broadcasting industry, our second and fourth quarter advertising revenue typically exceeds our first and third quarter advertising revenue. Seasonal fluctuations in advertising revenue correspond with quarterly fluctuations in the retail industry. Additionally, we experience increased demand for political advertising during election even numbered years, over non-election odd numbered years. Political advertising revenue varies based on the number and type of candidates as well as the number and type of debated issues.

 

Broadcast operating expenses include: (i) employee salaries, commissions and related employee benefits and taxes, (ii) facility expenses such as lease expense and utilities, (iii) marketing and promotional expenses, (iv) production and programming expenses, and (v) music license fees. In addition to these expenses, our network incurs programming costs and lease expenses for satellite communication facilities.

 

Digital Media

 

Revenue generated from this segment is reported as digital media revenue in our Consolidated Statements of Operations. Digital media revenue is impacted by the rates our sites can charge for advertising time, the level of advertisements sold, the number of impressions delivered, or the number of products sold, and the number of digital subscriptions sold. Like our broadcasting segment, our second and fourth quarter advertising revenue from our digital media segment generally exceeds the segment’s first and third quarter advertising revenue. This seasonal fluctuation in advertising revenue corresponds with quarterly fluctuations in the retail advertising industry. We also experience fluctuations in quarter-over-quarter comparisons based on the date on which Easter is observed, as this holiday generates a higher volume of product downloads from our church product websites. Additionally, we experience increased demand for advertising time and placement during election years for political advertisements.

 

The primary operating expenses incurred by our digital media businesses include: (i) employee salaries, commissions and related employee benefits and taxes, (ii) facility expenses such as lease expense and utilities, (iii) marketing and promotional expenses, (iv) royalties, (v) streaming costs, and (vi) cost of goods sold associated with e-commerce sites.

 

Health and Beauty

 

Except for AminoMints®, our health and beauty operations are owned by Simply Whim, Inc., and include Whim®, an emerging beauty brand blending Nature, Nutrition, and Science to offer safe and effective products. Whim’s founder, a 3-time cancer survivor under treatment, recognizes the U.S.'s regulatory lapses and strives for better standards. Exclusively made in the USA, Whim® aims to provide responsible beauty options. We forecast strong sales growth next year, driven by demand for safer beauty solutions, and plan to exceed these expectations with continued innovation.

 

Expenses which comprise the costs of goods sold will include licensing agreements and royalties, as well as operational and staffing costs related to the management of the Company’s syndicated radio network, product development and product marketing costs. General and administrative expenses are comprised of administrative wages; office expenses; outside legal, accounting, and other professional fees; travel and other miscellaneous office and administrative expenses. Selling and marketing expenses include selling/marketing wages and benefits, advertising, and promotional expenses, as well as travel and other miscellaneous related expenses.

 

Because we have incurred losses, income tax expenses are immaterial. No tax benefits have been booked related to operating loss carryforwards, given our uncertainty of being able to utilize such loss carryforwards in future years. We anticipate incurring additional losses during the coming year.

 

RESULTS OF OPERATION

 

Following is management’s discussion of the relevant items affecting results of operations for the three months ended August 31, 2023 and 2022.

 

 

 

 19 

 

 

Revenues. The Company generated no net revenues during the three months ended August 31, 2023 and 2022. Revenues in the past have been generated from spot sales on our syndicated radio network.

 

Cost of Sales. Our cost of sales were $-0- for the three months ended August 31, 2023 and 2022. Our cost of sales in the future will consist principally of licensing costs and royalties associated with our syndicated radio network, other related services provided directly or outsourced through our affiliates, as well as operational and staffing costs with respect thereto.

 

Salaries and Consulting Expenses. Executive salaries remain unpaid and accruing for the year ending May 31, 2023. Accrued salaries and consulting expenses were $60,000 and 60,000 for the three months ended August 31, 2023 and 2022, respectively. We expect that salaries and consulting expenses, that are cash-based instead of share-based, will increase as we add personnel to build our health and beauty business.

 

Professional Fees. Professional fees were $16,976 and $38,121 for the three months ended August 31, 2023 and 2022, respectively. Professional fees consist mainly of the fees related to the audits and reviews of the Company’s financial statements as well as the filings with the Securities and Exchange Commission. We anticipate that professional fees will increase in future periods as we scale up our operations.

 

Other Selling, General and Administrative Expenses. Other selling, general and administrative expenses were $567 and $1,305 for the three months ended August 31, 2023 and 2022, respectively. We anticipate that SG&A expenses will increase commensurate with an increase in our operations.

 

Other Income (Expenses). The Company had net other income of $430,625 for the three months ended August 31, 2023 compared to net other expenses of $12,014 for the three months ended August 31, 2022. During the three months ended August 31, 2023 and 2022, the company recorded income on the change in the fair value of the derivative liability in the amount of $543,223 and $41,194, respectively. During the three months ended August 31, 2023 and 2022, other expenses incurred were comprised of interest expenses related to notes payable in the amount of $112,598 and $53,208, which included the amortization of debt discounts of $24,125 and $14,878, respectively.

 

LIQUIDITY AND CAPITAL RESOURCES

 

As of August 31, 2023, our primary source of liquidity consisted of $117 in cash and cash equivalents. We hold our cash reserves in a major United States bank. Since inception, we have financed our operations through a combination of short and long-term loans, and through the private placement of our common stock.

 

We have sustained significant net losses which have resulted in negative working capital and an accumulated deficit at August 31, 2023 of $6,013,240 and $14,344,948, respectively, which raises doubt about our ability to continue as a going concern. We generated net income for the three months ended August 31, 2023 of $353,082, however, most of that income was the result of income from derivative liability rather than operating income. Without additional revenues, working capital loans, or equity investment, there is substantial doubt as to our ability to continue operations.

 

We believe these conditions have resulted from the inherent risks associated with small public companies. Such risks include, but are not limited to, the ability to (i) generate revenues and sales of our products and services at levels sufficient to cover our costs and provide a return for investors, (ii) attract additional capital in order to finance growth, and (iii) successfully compete with other comparable companies having financial, production and marketing resources significantly greater than those of the Company.

 

 

 

 

 20 

 

 

We believe that our capital resources are insufficient for ongoing operations, with minimal current cash reserves, particularly given the resources necessary to expand our multi-media entertainment business. We will likely require considerable amounts of financing to make any significant advancement in our business strategy. There is presently no agreement in place that will guarantee financing for our Company, and we cannot assure you that we will be able to raise any additional funds, or that such funds will be available on acceptable terms. Funds raised through future equity financing will likely be substantially dilutive to current shareholders. Lack of additional funds will materially affect our Company and our business and may cause us to substantially curtail or even cease operations. Consequently, you could incur a loss of your entire investment in the Company.

 

CRITICAL ACCOUNTING PRONOUNCEMENTS

 

Our financial statements and related public financial information are based on the application of generally accepted accounting principles in the United States (“GAAP”). GAAP requires the use of estimates, assumptions, judgments, and subjective interpretations of accounting principles that have an impact on the assets, liabilities, revenues, and expense amounts reported. These estimates can also affect supplemental information contained in our external disclosures including information regarding contingencies, risk, and financial condition. We believe our use of estimates and underlying accounting assumptions adhere to GAAP and are consistently and conservatively applied. We base our estimates on historical experience and on various other assumptions that we believe to be reasonable under the circumstances. Actual results may differ materially from these estimates under different assumptions or conditions. We continue to monitor significant estimates made during the preparation of our financial statements.

 

Our significant accounting policies are summarized in Note 2 of our financial statements included in our May 31, 2023 Form 10-K. While all these significant accounting policies impact our financial condition and results of operations, we view certain of these policies as critical. Policies determined to be critical are those policies that have the most significant impact on our financial statements and require management to use a greater degree of judgment and estimates. Actual results may differ from those estimates. Our management believes that given current facts and circumstances, it is unlikely that applying any other reasonable judgments or estimate methodologies would cause a material effect on our results of operations, financial position or liquidity for the periods presented in this report. 

 

We recognize revenue on arrangements in accordance with FASB ASC No. 605, “Revenue Recognition”.  In all cases, revenue is recognized only when the price is fixed and determinable, persuasive evidence of an arrangement exists, the service is performed, and collectability of the resulting receivable is reasonably assured.

 

RECENT ACCOUNTING PRONOUNCEMENTS

 

We have reviewed accounting pronouncements issued during the past two years and have adopted any that are applicable to the Company. We have determined that none had a material impact on our financial position, results of operations, or cash flows for the periods presented in this report.

 

OFF-BALANCE SHEET ARRANGEMENTS

 

We do not have any off-balance sheet arrangements, financings, or other relationships with unconsolidated entities or other persons, also known as “special purpose entities” (“SPE”s).

 

Item 3. Quantitative and Qualitative Disclosures about Market Risks

 

Not applicable because we are a smaller reporting company.

 

 

 

 

 21 

 

 

Item 4. Controls and Procedures

 

Evaluation of Disclosure Controls and Procedures 

 

Pursuant to Rule 13a-15(b) under the Securities Exchange Act of 1934 (“Exchange Act”), the Company carried out an evaluation, with the participation of the Company’s management, including the Company’s Chief Executive Officer (“CEO”) and Chief Financial Officer (“CFO”), of the effectiveness of the Company’s disclosure controls and procedures (as defined under Rule 13a-15(e) under the Exchange Act) as of the end of the period covered by this report. Based upon that evaluation, the Company’s CEO and CFO concluded that the Company’s disclosure controls and procedures were not effective to ensure that information required to be disclosed by the Company in the reports that the Company files or submits under the Exchange Act, is recorded, processed, summarized and reported, within the time periods specified in the SEC’s rules and forms, and that such information is accumulated and communicated to the Company’s management, including the Company’s CEO and CFO, as appropriate, to allow timely decisions regarding required disclosure as a result of continuing material weaknesses (such as the absence of an audit committee and absence of qualified independent directors) in its internal control over financial reporting. The disclosure controls and procedures were ineffective because there was no segregation of duties. One member of our management team handles all accounting duties including the recording of transactions, paying bills, and reconciling the bank account. We have minimized this risk by having an external accountant review all transactions and make the appropriate adjustments before the review by our external auditor.

 

Changes in Internal Controls Over Financial Reporting

 

There have been no changes in the Company's internal control over financial reporting during the latest fiscal quarter that have materially affected, or are reasonably likely to materially affect, the Company's internal control over financial reporting.

 

 

 

 

 

 

 

 

 22 

 

 

PART II - OTHER INFORMATION

 

Item 1. Legal Proceedings.

 

Currently we are not aware of any litigation pending or threatened by or against the Company.

 

Item 1A. Risk Factors

 

Not applicable because we are a smaller reporting company.

 

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

 

See Note 7 in the notes to the financial statements.

 

With respect to the transactions in Note 7 to the financial statements, each of the recipients of securities of the Company was an accredited investor or is considered by the Company to be a “sophisticated person”, inasmuch as each of them has such knowledge and experience in financial and business matters that they are capable of evaluating the merits and risks of receiving securities of the Company. No solicitation was made, and no underwriting discounts were given or paid in connection with these transactions. The Company believes that the issuance of its securities as described above was exempt from registration with the Securities and Exchange Commission pursuant to Section 4(2) of the Securities Act of 1933.

 

Item 3. Defaults Upon Senior Securities.

 

The Company has not paid the principal and interest due on 16 notes payable aggregating $996,611 at August 31, 2023. See Note 4 to the Consolidated Financial Statements.

 

Item 4. Mine Safety Disclosures

 

Not Applicable.

 

Item 5. Other Information.

 

None.

 

Item 6. Exhibits.

 

Exhibit No.   Description
3.1   Amended and Restated Articles of Incorporation of Music of Your life, Inc. (incorporated by reference to the Company's Form S-1/A filed on November 22, 2022)
3.2   Amended and Restated Bylaws of Music of Your Life, Inc. (incorporated by reference to the Company’s Form S-1/A filed on November 22, 2022)
31.1   Certification of Principal Executive Officer Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
32.1   Certification of Principal Executive Officer Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
101.INS   XBRL Instance Document
101.SCH   XBRL Taxonomy Extension Schema Document
101.CAL   XBRL Taxonomy Extension Calculation Linkbase Document
101.DEF   XBRL Taxonomy Extension Definition Linkbase Document
101.LAB   XBRL Taxonomy Extension Label Linkbase Document
101.PRE   XBRL Taxonomy Extension Presentation Linkbase Document

 

 

 

 23 

 

 

SIGNATURES

 

Pursuant to the requirements 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.

   

  The Marquie Group, Inc.
   
Date: October 23, 2023 By:  /s/  Marc Angell
    Marc Angell
    Chief Executive Officer
    (Duly Authorized Officer and Principal Executive Officer)

 

 

 

 

 

 

 

 

 

 

 

 

 24 

Exhibit 31.1

 

SECTION 302 CEO CERTIFICATION

Form of Certification Required

by Rules 13a-14 and 15d-14 under the Securities Exchange Act of 1934

 

I, Marc Angell, certify that:

 

  1. I have reviewed this Report on Form 10-Q of The Marquie Group, Inc.;

 

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

 

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

 

  4. The small business issuer’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)) for the small business issuer.  We have concluded that our disclosure controls and procedures were ineffective as of the end of the period covered by this quarterly report because there was no segregation of duties.  One member of our management team handles all accounting duties including the recording of transactions, paying bills, and reconciling the bank account.  We have minimized this risk by having an external accountant review all transactions and make the appropriate adjustments prior to the review by our external auditor.  We also 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 small business issuer, 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 small business issuer’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;

 

  d. Disclosed in this report any change in the small business issuer’s internal control over financial reporting that occurred during the small business issuer’s most recent fiscal quarter (the small business issuer’s second fiscal quarter in the case of this report) that has materially affected, or is reasonably likely to materially affect, the small business issuer’s internal control over financial reporting, and;

 

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

 

  a. All significant deficiencies and material weaknesses in the design or operation of internal controls over financial reporting, which are reasonably likely to adversely affect the small business issuer’s ability to record, process, summarize and report financial information; and

 

  b.

Any fraud, whether or not material, that involves management or other employees who have a significant role in the small business issuer’s internal control over financial reporting.

 

Date: October 23, 2023

 

  /s/ Marc Angell
  Marc Angell
  Chief Executive Officer

 

Exhibit 32.1

 

CERTIFICATION PURSUANT TO

SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

(18 U.S.C. SECTION 1350)

 

In connection with the accompanying report of The Marquie Group, Inc. (the “Company”) on Form 10-Q for the quarter ended August 31, 2023 (the “Report”), I, Marc Angell, Chief Executive 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, that:

 

  (1) To my knowledge, the Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934 (15 U.S.C. 78m or 78o(d)); and

 

  (2)

The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

 

Dated: October 23, 2023

 

  /s/ Marc Angell
  Marc Angell
  Chief Executive Officer

 

 

v3.23.3
Cover - shares
3 Months Ended
Aug. 31, 2023
Oct. 17, 2023
Cover [Abstract]    
Document Type 10-Q  
Amendment Flag false  
Document Quarterly Report true  
Document Transition Report false  
Document Period End Date Aug. 31, 2023  
Document Fiscal Period Focus Q1  
Document Fiscal Year Focus 2024  
Current Fiscal Year End Date --05-31  
Entity File Number 000-54163  
Entity Registrant Name The Marquie Group, Inc.  
Entity Central Index Key 0001434601  
Entity Tax Identification Number 26-2091212  
Entity Incorporation, State or Country Code FL  
Entity Address, Address Line One 7901 4th ST N  
Entity Address, Address Line Two Suite 4000  
Entity Address, City or Town St. Petersburg  
Entity Address, State or Province FL  
Entity Address, Postal Zip Code 33702  
City Area Code 800  
Local Phone Number 351-3021  
Entity Current Reporting Status Yes  
Entity Interactive Data Current Yes  
Entity Filer Category Non-accelerated Filer  
Entity Small Business true  
Entity Emerging Growth Company false  
Entity Shell Company false  
Entity Common Stock, Shares Outstanding   756,612,000
v3.23.3
Consolidated Balance Sheets - USD ($)
Aug. 31, 2023
May 31, 2023
CURRENT ASSETS    
Cash and cash equivalents $ 117 $ 0
Total Current Assets 117 0
OTHER ASSETS    
Investment in Acquisition 6,200,000 6,200,000
Loans receivable, related party 28,247 28,247
Music inventory, net of accumulated depreciation of $20,949 and $20,719, respectively 699 929
Trademark costs 10,365 10,365
Total Other Assets 6,239,311 6,239,541
TOTAL ASSETS 6,239,428 6,239,541
CURRENT LIABILITIES    
Bank overdraft 0 46
Accounts payable 67,639 50,664
Accrued interest payable on notes payable 666,491 578,017
Accrued consulting fees 1,205,917 1,145,917
Notes payable, net of debt discounts of $42,669 and $66,794, respectively 1,489,263 1,465,138
Notes payable to related parties 2,091,272 2,090,772
Derivative liability 492,775 1,035,998
Total Current Liabilities 6,013,357 6,366,552
TOTAL LIABILITIES 6,013,357 6,366,552
STOCKHOLDERS' DEFICIT    
Preferred Stock, $0.0001 par value; 20,000,000 shares authorized, 200 and 200 shares issued and outstanding 0 0
Common stock, $0.0001 par value; 50,000,000,000 shares authorized, 756,612,000 and 756,612,000 shares issued and outstanding, respectively 75,663 75,663
Common stock payable - 1 share 8,460 8,460
Additional paid-in-capital 14,486,896 14,486,896
Accumulated deficit (14,344,948) (14,698,030)
Total Stockholders' Deficit 226,071 (127,011)
TOTAL LIABILITIES AND STOCKHOLDERS' DEFICIT $ 6,239,428 $ 6,239,541
v3.23.3
Consolidated Balance Sheets (Parenthetical) - USD ($)
Aug. 31, 2023
May 31, 2023
Statement of Financial Position [Abstract]    
Net of accumulated depreciation $ 20,949 $ 20,719
Debt instrument, unamortized discount $ 42,669 $ 66,794
preferred stock, par value $ 0.0001 $ 0.0001
Preferred stock shares authorized 20,000,000 20,000,000
Preferred stock shares issued 200 200
Preferred stock shares outstanding 200 200
Common stock, par value $ 0.0001 $ 0.0001
Common stock, shares authorized 50,000,000,000 50,000,000,000
Common stock, shares issued 756,612,000 756,612,000
Common stock, shares outstanding 756,612,000 756,612,000
v3.23.3
Consolidated Statements of Operations (Unaudited) - USD ($)
3 Months Ended
Aug. 31, 2023
Aug. 31, 2022
Income Statement [Abstract]    
NET REVENUES $ 0 $ 0
OPERATING EXPENSES    
Accrued Salaries and Consulting fees 60,000 60,000
Professional fees 16,976 38,121
Other selling, general and administrative 567 1,305
Total Operating Expenses 77,543 99,426
LOSS FROM OPERATIONS (77,543) (99,426)
OTHER INCOME (EXPENSES)    
Income (expense) from derivative liability 543,223 41,194
Interest expense (including amortization of debt discounts of $24,125, and $14,878, respectively) (112,598) (53,208)
Total Other Income (Expenses) 430,625 (12,014)
INCOME (LOSS) BEFORE INCOME TAXES 353,082 (111,440)
INCOME TAX EXPENSE 0 0
NET INCOME (LOSS) $ 353,082 $ (111,440)
v3.23.3
Consolidated Statements of Operations (Unaudited) (Parenthetical) - USD ($)
3 Months Ended
Aug. 31, 2023
Aug. 31, 2022
Income Statement [Abstract]    
Amortization of debt discount $ 24,125 $ 14,878
Net income (loss) per common share, Basic $ 0.00 $ (0.01)
Net income (loss) per common share, Diluted $ 0.00 $ (0.01)
Weighted average shares outstanding, Basic 756,612,000 16,192,332
Weighted average shares outstanding, Diluted 756,612,000 16,192,332
v3.23.3
Consolidated Statements of Stockholders' Deficit (Unaudited) - USD ($)
Preferred Stock [Member]
Common Stock [Member]
Common Stock Payable [Member]
Additional Paid-in Capital [Member]
Retained Earnings [Member]
Total
Beginning balance, value at May. 31, 2022 $ 0 $ 1,621 $ 8,460 $ 10,213,431 $ (15,878,189) $ (5,654,677)
Beginning balance, Shares at May. 31, 2022 200 16,189,732        
Round up of shares from reverse stock split
Round up of shares from reverse stock split, shares   2,600        
Net loss (111,440) (111,440)
Ending balance, value at Aug. 31, 2022 $ 0 $ 1,621 8,460 10,213,431 (15,989,629) (5,766,117)
Ending balance, Shares at Aug. 31, 2022 200 16,192,332        
Beginning balance, value at May. 31, 2023 $ 0 $ 75,663 8,460 14,486,896 (14,698,030) (127,011)
Beginning balance, Shares at May. 31, 2023 200 756,612,000        
Net loss 353,082 353,082
Ending balance, value at Aug. 31, 2023 $ 0 $ 75,663 $ 8,460 $ 14,486,896 $ (14,344,948) $ 226,071
Ending balance, Shares at Aug. 31, 2023 200 756,612,000        
v3.23.3
Consolidated Statements of Cash Flows (Unaudited) - USD ($)
3 Months Ended
Aug. 31, 2023
Aug. 31, 2022
CASH FLOWS FROM OPERATING ACTIVITIES:    
Net income (loss) $ 353,082 $ (111,440)
Adjustments to reconcile net income (loss) to net cash used by operating activities:    
Depreciation of music inventory 230 389
Income from derivative liability (543,223) (41,194)
Amortization of debt discounts 24,125 14,878
Changes in operating assets and liabilities:    
Accounts payable 16,975 20,421
Accrued interest payable on notes payable 88,474 34,451
Accrued consulting fees 60,000 55,700
Net Cash Used by Operating Activities (337) (26,795)
CASH FLOWS FROM INVESTING ACTIVITIES: 0 0
CASH FLOWS FROM FINANCING ACTIVITIES:    
Bank overdraft (46) 62
Proceeds from notes payable 0 38,880
Repayments of notes payable to related parties 0 (12,500)
Proceeds from notes payable to related parties 500 0
Net Cash Provided by Financing Activities 454 26,442
NET INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS 117 (353)
CASH AND CASH EQUIVALENTS, BEGINNING OF PERIOD 0 353
CASH AND CASH EQUIVALENTS, END OF PERIOD 117 0
Cash Payments For:    
Interest 0 0
Income taxes 0 0
Non-cash investing and financing activities:    
Initial derivative liability charged to debt discounts $ 0 $ 38,880
v3.23.3
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES AND ORGANIZATION
3 Months Ended
Aug. 31, 2023
Accounting Policies [Abstract]  
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES AND ORGANIZATION

NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES AND ORGANIZATION

 

Basis of Presentation

 

The accompanying unaudited financial statements are presented in accordance with generally accepted accounting principles for interim financial information and the instructions to Form 10-Q and Article 8 of Regulation S-X. Accordingly, they do not include all of the information and footnotes required by generally accepted accounting principles for complete financial statements. In the opinion of management, all adjustments (consisting only of normal recurring accruals) considered necessary in order to make the financial statements not misleading, have been included. Operating results for the three months ended August 31, 2023 are not necessarily indicative of results that may be expected for the year ending May 31, 2024. 

 

Organization

 

The Marquie Group, Inc. (formerly Music of Your Life, Inc.) (the “Company”) was incorporated under the laws of the State of Florida on January 30, 2008 under the name of “Zhong Sen International Tea Company”. From January 2008 to May 2013, the Company operated with the principal business objective of providing sales and marketing consulting services to small to medium sized Chinese tea producing companies who wished to export and distribute high quality Chinese tea products worldwide. On May 31, 2013 (the “Closing Date”), the Company entered into a Merger Agreement (the “Merger Agreement”) by and among the Company, Music of Your Life, Inc., a Nevada corporation (“MYL Nevada”) incorporated October 10, 2012, and Music of Your Life Merger Sub, Inc., a Utah corporation ("Merger Sub"), pursuant to which MYL Nevada merged with Merger Sub. As a result of the merger, MYL Nevada became a wholly owned subsidiary of the Company, and on July 26, 2013, the Company changed its name to Music of Your Life, Inc., a syndicated radio network. On May 20, 2014 the Company acquired 100% of the outstanding stock of iRadio, Inc., a Utah corporation. The Company was the surviving corporation. iRadio was an entity related to the Company by common ownership.

 

Acquisition of The Marquie Group, Inc.

 

On August 16, 2018 (see Note 8), the Company merged with The Marquie Group, Inc. (“TMGI”) in exchange for the issuance of a total of 100 shares of our common stock to TMGI’s stockholders. Following the merger, the Company had 102 shares of common stock issued and outstanding. On December 5, 2018, the Company amended and restated its Articles of Incorporation providing for a change in the Company’s name from “Music of Your Life, Inc.” to “The Marquie Group, Inc.” The TMGI business plan is to license, develop and launch a direct-to-consumer, health and beauty product line called “Whim” that use innovative formulations of plant-based, amino-acids and other natural alternatives to chemical ingredients.

 

v3.23.3
MUSIC INVENTORY
3 Months Ended
Aug. 31, 2023
Inventory Disclosure [Abstract]  
MUSIC INVENTORY

NOTE 2 - MUSIC INVENTORY

 

Music inventory consisted of the following: 

          
   August 31, 2023   May 31, 2023 
Digital music acquired for use in operations – at cost  $21,648   $21,648 
Accumulated depreciation   (20,949)   (20,719)
Music inventory – net  $699   $929 

 

The Company purchases digital music to broadcast over the radio and internet. During the three months ended August 31, 2023, the Company purchased $-0- worth of music inventory. For the three months ended August 31, 2023 and 2022, depreciation of music inventory was $230 and $389, respectively.

 

v3.23.3
ACCRUED CONSULTING FEES
3 Months Ended
Aug. 31, 2023
Payables and Accruals [Abstract]  
ACCRUED CONSULTING FEES

NOTE 3 – ACCRUED CONSULTING FEES

 

Accrued consulting fees consisted of the following: 

          
   August 31, 2023   May 31, 2023 
Due to Company Chief Executive Officer pursuant to Consulting Agreement dated March 1, 2017 – monthly compensation of $10,000 to May 31, 2022, increased to $20,000 after May 31, 2022  $548,817   $488,817 
Due to wife of Company Chief Executive Officer pursuant to consulting agreement effective August 16, 2018 – monthly compensation of $15,000 (which was terminated May 31, 2021)   305,200    305,200 
Due to mother of Company Chief Executive Officer pursuant to Consulting Agreement dated September 1, 2015 (which was terminated November 30, 2019) – monthly compensation of $5,000 to November 30, 2019   131,350    131,350 
Due to service provider pursuant to Consulting Agreement dated September 1, 2015 (which was terminated February 28, 2019) – monthly compensation of $5,000 to February 28, 2019   144,700    144,700 
Due to service provider pursuant to Consulting Agreement dated September 1, 2015 (which was terminated November 30, 2019) – monthly compensation of $1,000 to November 30, 2019   48,000    48,000 
Due to two other service providers   27,850    27,850 
           
Total  $1,205,917   $1,145,917 

 

The accrued consulting fees balance changed as follows: 

          
   Three Months Ended
August 31, 2023
   Year Ended
May 31, 2023
 
Balance, beginning of period  $1,145,917   $926,217 
           
Compensation expense accrued pursuant to consulting agreements   60,000    240,000 
Payments to consultants       (20,300)
           
Balance, end of period  $1,205,917   $1,145,917 

 

See Note 8 (Commitments and Contingencies).

 

v3.23.3
NOTES PAYABLE
3 Months Ended
Aug. 31, 2023
Debt Disclosure [Abstract]  
NOTES PAYABLE

NOTE 4 - NOTES PAYABLE

 

Notes payable consisted of the following:

          
   August 31, 2023   May 31, 2023 
Notes payable to an entity, non-interest bearing, due on demand, unsecured  $64,700   $64,700 
Note payable to an individual, due on May 22, 2015, in default (B)   25,000    25,000 
Note payable to an entity, non-interest bearing, due on February 1, 2016, in default (D)   50,000    50,000 
Note payable to a family trust, stated interest of $2,500, due on October 31, 2015, in default (E)   7,000    7,000 
Note payable to a corporation, stated interest of $5,000, due on October 21, 2015, in default (G)   50,000    50,000 
Note payable to a corporation, stated interest of $5,000, due on November 6, 2015, in default (H)   50,000    50,000 
Note payable to an individual, due on December 20, 2015, in default, 24% default rate from January 20, 2016 (I)   25,000    25,000 
Convertible note payable to an entity, interest at 12%, due on December 29, 2016, in default (M)   40,000    40,000 
Note payable to a family trust, interest at 10%, due on November 30, 2016, in default (P)   25,000    25,000 
Convertible note payable to an individual, interest at 10%, due on demand (V)   46,890    46,890 
Convertible note payable to an individual, interest at 8%, due on demand (W)   29,000    29,000 
Convertible note payable to an individual, interest at 8%, due on demand (X)   21,500    21,500 
Convertible note payable to an entity, interest at 10%, due on demand (Y)   8,100    8,100 
Convertible note payable to an entity, interest at 10%, due on March 5, 2019, in default (DD)   35,000    35,000 
Convertible note payable to an entity, interest at 10%, due on September 18, 2019, in default (GG)   8,505    8,505 
Convertible note payable to an entity, interest at 12%, due on November 30, 2021, in default, net of discount of $-0- and $85,233, respectively (SS)   154,764    154,764 
Convertible note payable to an entity, interest at 10%, due on June 4, 2022, in default (VV)   170,212    170,212 
Convertible note payable to an entity, interest at 8%, due on August 27, 2022, in default (WW)   14,000    14,000 
Convertible note payable to an entity, interest at 12%, due on December 21, 2022, in default (YY)   58,250    58,250 
Convertible note payable to an entity, interest at 12%, due on February 8, 2023, in default (ZZ)   245,000    245,000 
Convertible note payable to an entity, interest at 12%, due on June 10, 2023, in default, net of discount of $-0- and $1,065, respectively (AA)   38,880    37,815 
Convertible note payable to an entity, interest at 12%, due on November 4, 2023, net of discount of $5,441 and $13,143, respectively (C)   25,114    17,412 
Convertible note payable to an entity, interest at 12%, due on April 10, 2024, net of discount of $37,228 and $52,586, respectively (F)   23,872    8,514 
Note payable to the Small Business Administration under the Payroll Protection Program, interest at 1%, due in installments through May 4, 2022, forgivable in part or whole subject to certain requirements   70,000    70,000 
Note payable to the Small Business Administration under the Payroll Protection Program, interest at 1%, due in installments through April 5, 2023, forgivable in part or whole subject to certain requirements   100,000    100,000 
Notes payable to individuals, non-interest bearing, due on demand   103,476    103,476 
Total Notes Payable   1,489,263    1,465,138 
Less: Current Portion   (1,489,263)   (1,465,138)
Long-Term Notes Payable  $   $ 

 

(B) On April 22, 2015, the Company issued a $25,000 Promissory Note, non-interest bearing (interest at 24% per annum after May 22, 2015), due at maturity on May 22, 2015.

 

(D) On July 24, 2015, the Company issued a $50,000 Promissory Note to Kodiak Capital Group, LLC (“Kodiak”) for services rendered in association with an Equity Purchase Agreement. As amended and restated January 4, 2016, the note is non-interest bearing and was due on February 1, 2016.

 

(E) On July 31, 2015, the Company issued a $25,000 Promissory Note with a stated interest amount of $2,500 due at maturity on October 31, 2015.

 

(G) On August 6, 2015, the Company issued a $50,000 Promissory Note with a stated interest amount of $5,000 due at maturity on October 21, 2015.

 

(H) On August 21, 2015, the Company issued a $50,000 Promissory Note with a stated interest amount of $5,000 due at maturity on November 6, 2015.

 

(I) On September 21, 2015, the Company issued a $25,000 Promissory Note with a stated interest amount of $2,500 due at maturity on December 20, 2015. In the event that all principal and interest are not paid to the lender by January 20, 2016, interest is to accrue at a rate of 24% per annum commencing on January 21, 2016.

 

(M) On December 29, 2015, the Company issued a $20,000 Convertible Promissory Note to a lender for net loan proceeds of $15,000. The note bears interest at a rate of 12% per annum, was due on December 29, 2016, and is convertible at the option of the lender into shares of the Company common stock at a Conversion Price equal to 50% of the lowest closing bid price during the 30 Trading Day period prior to the Conversion Date. See Note 6 (Derivative Liability).

 

(P) On June 3, 2016, the Company issued a $25,000 Promissory Note. The note bears interest at a rate of 10% per annum and was due on November 30, 2016.

 

(V) On May 3, 2017, the Company issued a $72,750 Convertible Promissory Note to a lender as a replacement for the principal and interest due on a promissory note due on October 14, 2014. The note bears interest at a rate of 10% per annum, is due on demand, and is convertible at the option of the lender into shares of the Company common stock at a Conversion Price equal to $0.1293 per share.

 

(W) On April 5, 2017, the Company issued a $35,000 Convertible Promissory Note to a lender as a replacement for the principal and interest due on a promissory note due on August 23, 2015. The note bears interest at a rate of 8% per annum, is due on demand, and is convertible at the option of the lender into shares of the Company common stock at a Conversion Price equal to 40% of the lowest Trading Price during the 5 Trading Day period prior to the Conversion Date. See Note 6 (Derivative Liability).

 

(X) On April 5, 2017, the Company issued a $27,500 Convertible Promissory Note to a lender as a replacement for the principal and interest due on a promissory note due on October 31, 2015. The note bears interest at a rate of 8% per annum, is due on demand, and is convertible at the option of the lender into shares of the Company common stock at a Conversion Price equal to 40% of the lowest Trading Price during the 5 Trading Day period prior to the Conversion Date. See Note 6 (Derivative Liability).

 

(Y) On March 1, 2017, the Company issued a $8,600 Convertible Promissory Note to a vendor of the Company to convert certain accounts payable due to the vendor. The note bears interest at a rate of 10% per annum, is due on demand, and is convertible at the option of the lender into shares of the Company common stock at a Conversion Price equal to the higher of $0.04 per share or 60% of the lowest Trading Price during the 5 Trading Day period prior to the Conversion Date.

 

(DD) On March 5, 2018, the Company issued a $35,000 Convertible Promissory Note to a lender for net loan proceeds of $33,000. The note bears interest at a rate of 10% per annum, was due on March 5, 2019, and is convertible at the option of the lender into shares of the Company common stock at a Conversion Price equal to 50% of the lowest Trading Price during the 20 Trading Day period prior to the Conversion Date. See Note 6 (Derivative Liability).

 

(GG) On September 18, 2018, the Company issued a $18,000 Convertible Promissory Note to a lender for net loan proceeds of $14,000. The note bears interest at a rate of 10% per annum, was due on September 18, 2019, and is convertible at the option of the lender into shares of the Company common stock at a Conversion Price equal to 50% of the lowest Trading Price during the 20 Trading Day period prior to the Conversion Date. See Note 6 (Derivative Liability).

 

(SS) On November 30, 2020, the Company issued a $170,000 Convertible Promissory Note to a lender which paid off some of the accrued interest for the note described in (RR) above. The Company received net proceeds of $32,500. The note bears interest at a rate of 12% per annum, is due on November 30, 2021, and is convertible at the option of the lender into shares of the Company common stock at a Conversion Price equal to the lesser of (1) 105% of the closing bid price of the Common Stock on the Issue Date, or (2) the closing bid price of the Common Stock on the Trading Day immediately preceding the date of the conversion. See Note 6 (Derivative Liability).

 

(VV) On June 4, 2021, the Company issued a $238,596 Convertible Promissory Note to a lender which paid off the principal and accrued interest for the notes described in (EE), (FF), (KK), (LL), (MM), (NN) and (PP) above. The note bears interest at a rate of 10% per annum, is due on June 4, 2022, and is convertible at the option of the lender into shares of the Company common stock at a Conversion Price equal to the lesser of (1) $0.00004, or (2) 50% of the lowest trading price of the common stock for the previous 15 day trading period. See Note 6 (Derivative Liability).

 

(WW) On August 27, 2021, the Company issued a $14,000 Convertible Promissory Note to a lender for net loan proceeds of $10,000. The note bears interest at a rate of 8% per annum, is due on August 27, 2022, and is convertible at the option of the lender into shares of the Company common stock at a Conversion Price equal to 65% of the lowest trading price in the 10 Trading Day period prior to the Conversion Date. See Note 6 (Derivative Liability).

 

(YY) On December 21, 2021, the Company issued a $58,250 Convertible Promissory Note to a lender for net loan proceeds of $49,925. The note bears interest at a rate of 12% per annum, is due on December 21, 2022, and is convertible at the option of the lender into shares of the Company common stock at a Conversion Price equal to the higher of (1) $0.10, or (2) the par value of the Common Stock.

 

(ZZ) On February 8, 2022, the Company issued a $245,000 Convertible Promissory Note to a lender for net loan proceeds of $218,000. The note bears interest at a rate of 12% per annum, is due on February 8, 2023, and is convertible at the option of the lender into shares of the Company common stock at a Conversion Price equal to the higher of (1) $0.10, or (2) the par value of the Common Stock.

 

(AA) On June 10, 2022, the Company issued a $38,880 Convertible Promissory Note to a lender for net loan proceeds of $31,800. The note bears interest at a rate of 12% per annum, is due on June 10, 2023, and is convertible at the option of the lender into shares of the Company common stock at a Conversion Price equal to the lower of (1) $0.05, or (2) 50% of the lowest trading price in the 10 Trading Day period prior to the Conversion Date. See Note 6 (Derivative Liability).

 

(C) On November 4, 2022, the Company issued a $30,555 Convertible Promissory Note to a lender for net loan proceeds of $25,000. The note bears interest at a rate of 12% per annum, is due on November 4, 2023, and is convertible at the option of the lender into shares of the Company common stock at a Conversion Price equal to the lower of (1) $0.005, or (2) 50% of the lowest trading price in the 10 Trading Day period prior to the Conversion Date. See Note 6 (Derivative Liability).

 

Concentration of Notes Payable:

 

The principal balance of notes payable was due to: 

          
   August 31, 2023   May 31, 2023 
         
Lender A  $458,014   $458,014 
Lender B   170,212    170,212 
14 other lenders   903,706    903,706 
           
Total   1,531,932    1,531,932 
           
Less debt discounts   (42,669)   (66,794)
           
Net  $1,489,263   $1,465,138 

 

v3.23.3
NOTES PAYABLE – RELATED PARTIES
3 Months Ended
Aug. 31, 2023
Related Party Transactions [Abstract]  
NOTES PAYABLE – RELATED PARTIES

NOTE 5 - NOTES PAYABLE – RELATED PARTIES

 

Notes payable – related parties consisted of the following: 

          
   August 31,
2023
   May 31,
2023
 
         
Note payable to Company law firm (and owner of 2,500 shares of common stock since August 16, 2018), non-interest bearing, due on demand, unsecured  $2,073   $2,073 
Notes payable to The OZ Corporation (owner of 2,500 shares of common stock since August 16, 2018), non-interest bearing, due on demand, unsecured   69,250    69,250 
Note payable to the Chief Executive Officer, non-interest bearing, due on demand, unsecured   19,949    19,449 
Note payable to the wife of the Chief Executive Officer as part of the 25% acquisition of Simply Whim, interest at 12%, due on September 20, 2023, unsecured (See Note 10)   2,000,000    2,000,000 
Total Notes Payable   2,091,272    2,090,772 
Less: Current Portion   (2,091,272)   (2,090,772)
Long-Term Notes Payable  $   $ 

 

v3.23.3
DERIVATIVE LIABILITY
3 Months Ended
Aug. 31, 2023
Derivative Liability  
DERIVATIVE LIABILITY

NOTE 6 - DERIVATIVE LIABILITY

 

The derivative liability at August 31, 2023 and May 31, 2023 consisted of: 

                    
   August 31, 2023   May 31, 2023 
   Face Value   Derivative Liability   Face Value   Derivative Liability 
Convertible note payable issued December 29, 2015, due December 29, 2016 (M)  $40,000   $74,286   $40,000   $81,481 
Convertible note payable issued April 5, 2017, due on demand (W)   29,000    51,556    29,000    81,093 
Convertible note payable issued April 5, 2017, due on demand (X)   21,500    38,222    21,500    60,120 
Convertible note payable issued March 5, 2018, due on March 5, 2019 (DD)   35,000    65,000    35,000    71,296 
Convertible note payable issued September 18, 2018, due on September 18, 2019 (GG)   8,506    15,796    8,506    17,326 
Convertible note payable issued November 30, 2020, due on November 30, 2021 (SS)   154,764    33,979    154,764    151,020 
Convertible note payable issued June 4, 2021, due on June 4, 2022 (VV)   170,212    36,245    170,212    153,285 
Convertible note payable issued August 27, 2021, due on August 27, 2022 (WW)   14,000    16,769    14,000    18,707 
Convertible note payable issued June 10, 2022, due on June 10, 2023 (AA)   38,880    35,867    38,880    154,078 
Convertible note payable issued November 4, 2022, due on November 4, 2023 (C)   30,555    87,300    30,555    92,797 
Convertible note payable issued April 10, 2023, due on April 10, 2024 (F)   61,100    37,755    61,100    154,795 
                     
Totals  $603,517   $492,775   $603,517   $1,035,998 

 

The above convertible notes contain a variable conversion feature based on the future trading price of the Company common stock. Therefore, the number of shares of common stock issuable upon conversion of the notes is indeterminate. Accordingly, we have recorded the fair value of the embedded conversion features as a derivative liability at the respective issuance dates of the notes and charged the applicable amounts to debt discounts and the remainder to other expense. The increase (decrease) in the fair value of the derivative liability from the respective issuance dates of the notes to the measurement dates is charged (credited) to other expense (income). The fair value of the derivative liability of the notes is measured at the respective issuance dates and quarterly thereafter using the Black Scholes option pricing model.

 

Assumptions used for the calculations of the derivative liability of the notes at August 31, 2023 include (1) stock price of $0.001 per share, (2) exercise prices ranging from $0.00004 to $0.00045 per share, (3) terms ranging from 0 days to 223 days, (4) expected volatility of 2,193% and (5) risk free interest rates ranging from 5.52% to 5.61%.

 

Assumptions used for the calculations of the derivative liability of the notes at May 31, 2023 include (1) stock price of $0.0041 per share, (2) exercise prices ranging from $0.00004 to $0.001755 per share, (3) terms ranging from 0 days to 315 days, (4) expected volatility of 2,189% and (5) risk free interest rates ranging from 4.65% to 5.28%.

 

Concentration of Derivative Liability:

 

The derivative liability relates to convertible notes payable due to: 

          
   August 31, 2023   May 31, 2023 
         
Lender A  $33,979   $151,020 
Lender B   36,245    153,285 
Lender C   35,867    415,233 
Lender D   97,565    107,329 
5 other lenders   289,119    209,131 
           
Total  $492,775   $1,035,998 

 

v3.23.3
EQUITY TRANSACTIONS
3 Months Ended
Aug. 31, 2023
Equity [Abstract]  
EQUITY TRANSACTIONS

NOTE 7 - EQUITY TRANSACTIONS

 

During the year ended May 31, 2021, the Company issued an aggregate of 4,304,842 shares of common stock for the conversion of notes payable and accrued interest in the aggregate amount of $835,050. We incurred a loss on the conversion of notes payable and accrued interest of $1,445,042, which represents the excess of the $2,280,092 fair value of the 4,304,842 shares at the dates of conversion over the $835,050 amount of debt satisfied.

 

Effective April 21, 2022, the Company effectuated a 1 for 1,000 reverse split of the Company’s Common Stock (“Reverse Split”), meaning that each 1,000 shares of Common Stock is consolidated into 1 share of Common Stock following the reverse split, provided however, that fractional shares would be rounded up to the nearest whole share. Following the Reverse Split, the Company had 16,192,332 common shares issued and outstanding. The accompanying financial statements have been retroactively adjusted to reflect this reverse stock split.

 

On October 13, 2022 (the “Closing Date”), the Company entered into a Standby Equity Commitment Agreement (the “Equity Agreement” by and among the Company, and MacRab, LLC, a Florida limited liability company ("MacRab"), pursuant to which MacRab has agreed to purchase at the Company’s sole discretion, up to five million dollars ($5,000,000) of the Company's common stock (the “Put Shares”) at a purchase price of 90% of the average of the two (2) lowest volume weighted average prices of the Company’s Common Stock on OTCQB during the six (6) Trading Days immediately following the Clearing Date.

 

Contemporaneous therewith, the Company and MacRab also entered into a Registration Rights Agreement, whereby the Company has agreed to provide certain registration rights under the Securities Act of 1933, as amended. Pursuant to the Registration Rights Agreement, the Company has registered the Put Shares pursuant in a registration statement on Form S-1 (the “Registration Statement”). The Registration Statement was filed on October 21, 2022.

 

Also on the Closing Date, pursuant to the Equity Agreement, the Company issued to MacRab a warrant (the “Warrant”) to acquire 11,764,706 shares of the Company’s common stock.

 

v3.23.3
COMMITMENTS AND CONTINGENCIES
3 Months Ended
Aug. 31, 2023
Commitments and Contingencies Disclosure [Abstract]  
COMMITMENTS AND CONTINGENCIES

NOTE 8 - COMMITMENTS AND CONTINGENCIES

 

Consulting Agreements with Individuals

 

The Company has entered into Consulting Agreements with the Company’s Chief Executive Officer, the wife of the Company’s Chief Executive Officer, the mother of the Company’s Chief Executive Officer, and other service providers (see Note 3 – Accrued Consulting Fees). The Consulting Agreement with the Company’s Chief Executive Officer provided for monthly compensation of $10,000 through May 31, 2022 and was increased to $20,000 after May 31, 2022. The Consulting Agreement with the wife of the Company’s Chief Executive Officer provided for monthly compensation of $15,000 and expired on May 31, 2021. The Consulting Agreement with the mother of the Company’s Chief Executive Officer provided for monthly compensation of $5,000 and was terminated as of November 30, 2019. The other 3 consulting agreements provided for monthly compensation totaling $6,500 and were terminated as of November 30, 2019.

 

Corporate Consulting Agreement

 

On March 14, 2018, the Company executed a Corporate Consulting Agreement (the “Agreement”) with a consulting firm entity (the “Consultant”). The Agreement provided for the Consultant to perform certain investor relations and other services for the Company. The term of the Agreement was 4 months but the Agreement provided that the Company could terminate the Agreement for any reason at any time upon 5 days written prior notice. The Agreement provided for 8 payments of cash fees totaling $240,000 to be paid to the Consultant over 4 months.

 

On April 1, 2018, the Company notified the Consultant that the Agreement was terminated. A total of $25,000 was paid to the Consultant in March 2018 which was expensed and included in “Salaries and Consulting Fees” in the Consolidated Statement of Operations for the year ended May 31, 2018. No other amounts were paid or accrued subsequent to May 31, 2018.

 

On October 16, 2018 (see Note 7), the Company issued 5,000 shares of its common stock to the Consultant. On October 26, 2018, the Consultant advised the Company that it had not been notified that the Agreement was terminated on April 1, 2018 and that the Company is in default of the Agreement.

 

v3.23.3
GOING CONCERN
3 Months Ended
Aug. 31, 2023
Organization, Consolidation and Presentation of Financial Statements [Abstract]  
GOING CONCERN

NOTE 9 -