Filed Pursuant to Rule 253(g)(2)
File No. 024-10761
Offering Circular Supplement
Dated May 8, 2018
An Offering Statement pursuant to Regulation A relating to these securities has been
filed with the Securities and Exchange Commission (SEC). The offering was Qualified on
December 15, 2017. A Post-Qualification Amendment #1 was filed with the SEC and was
Qualified on March 28, 2018.
This Offering Supplement only covers a change in the offering price of a portion of the
shares offered. This change affects only the dilution and gross proceeds.
We may elect to satisfy our obligation to deliver a Final Offering Circular by sending you
a notice within two business days after the completion of our sale to you that contains
the URL where the Final Offering Circular or the Offering Statement in which such Final
Offering Circular was filed may be obtained.
OFFERING CIRCULAR
CLIKIA CORP.
1,250,000,000 Shares of Common Stock
This Post-Qualification Offering Circular Amendment No. 1 (the PQA) amends the offering
circular of Clikia Corp., dated December 15, 2017, as qualified on December 15, 2017,
and as may be amended and supplemented from time to time, to add additional shares of common
stock (the Offered Shares) to be offered pursuant to the Offering Circular. This PQA
relates to the offer and sale of up to an additional 250,000,000 Offered Shares, for
a revised maximum of 1,250,000,000 Offered Shares.
By this Offering Circular, Clikia Corp., a Nevada corporation, is offering for sale
a maximum of 1,250,000,000 shares of its common stock (the Offered Shares), at a fixed
price of $0.0003 per share, pursuant to Tier 1 of Regulation A of the United States
Securities and Exchange Commission (the SEC). A minimum purchase of $300 of the Offered
Shares is required in this offering. This offering is being conducted on a best-efforts
basis, which means that there is no minimum number of Offered Shares that must be sold
by us for this offering to close; thus, we may receive no or minimal proceeds from this
offering. All proceeds from this offering will become immediately available to us and may
be used as they are accepted. Purchasers of the Offered Shares will not be entitled to a
refund and could lose their entire investments. This offering will terminate at the
earliest of (a) the date on which the maximum offering has been sold, (b) the date which
is one year from this offering being qualified by the SEC or (c) the date on which this
offering is earlier terminated by us, in our sole discretion. (See Plan of Distribution).
Title of
Securities Number Price Commissions(1) Proceeds to Company(2)
Offered of Shares to Public
Common Stock 1,250,000,000 $0.0003 $-0- $732,200
(1) We may offer the Offered Shares through registered broker-dealers and we may pay
finders. However, information as to any such broker-dealer or
finder shall be disclosed in an amendment to this Offering Circular.
(2) Does not account for the payment of expenses of this offering estimated at $25,000.
See Plan of Distribution.
Our common stock is quoted on the OTC Pink, which is operated by OTC Markets Group, Inc.
(OTC Markets), under the ticker symbol CLKA. On May 8, 2018, the closing price of our
common stock was $0.0006 per share.
Investing in the Offered Shares is speculative and involves substantial risks. You should
purchase Offered Shares only if you can afford a complete loss of your investment. See
Risk Factors, beginning on page 4, for a discussion of certain risks
that you should consider before purchasing any of the Offered Shares.
THE SEC DOES NOT PASS UPON THE MERITS OF, OR GIVE ITS APPROVAL TO, ANY SECURITIES OFFERED
OR THE TERMS OF THE OFFERING, NOR DOES IT PASS UPON THE ACCURACY OR COMPLETENESS OF ANY
OFFERING CIRCULAR OR OTHER SOLICITATION MATERIALS. THESE SECURITIES ARE OFFERED PURSUANT
TO AN EXEMPTION FROM REGISTRATION WITH THE SEC. HOWEVER, THE SEC HAS NOT MADE AN
INDEPENDENT DETERMINATION THAT THE SECURITIES OFFERED ARE EXEMPT FROM REGISTRATION.
The use of projections or forecasts in this offering is prohibited. No person is permitted
to make any oral or written predictions about the benefits you will receive from an
investment in Offered Shares.
No sale may be made to you in this offering, if you do not satisfy the investor
suitability standards described in this Offering Circular under Plan of Distribution-State
Law Exemption and Offerings to Qualified Purchasers-Investor Suitability Standards (page
15). Before making any representation that you satisfy the established investor suitability
standards, we encourage you to review Rule 251(d)(2)(i)(C) of Regulation A. For general
information on investing, we encourage you to refer to www.investor.gov.
This Offering Circular follows the disclosure format of Form S-1, pursuant to the
General Instructions of Part II(a)(1)(ii) of Form 1-A.
The date of this Post-Qualification Offering Circular
Amendment No. 1 is March 28, 2018.
TABLE OF CONTENTS
Page
Cautionary Statement Regarding Forward-Looking Statements 2
Offering Circular Summary 2
Risk Factors 4
Dilution 11
Use of Proceeds 12
Plan of Distribution 13
Description of Securities 14
Business 16
Management's Discussion and Analysis of Financial
Condition and Results of Operations 20
Directors, Executive Officers, Promoters and Control Persons 23
Executive Compensation 24
Security Ownership of Certain Beneficial Owners and Management 25
Certain Relationships and Related Transactions 26
Legal Matters 27
Where You Can Find More Information 27
Index to Financial Statements 27
CAUTIONARY STATEMENT REGARDING FORWARD-LOOKING STATEMENTS
The information contained in this Offering Circular includes some statements that
are not historical and that are considered forward-looking statements. Such
forward-looking statements include, but are not limited to, statements regarding
our development plans for our business; our strategies and business outlook;
anticipated development of our company; and various other matters (including
contingent liabilities and obligations and changes in accounting policies,
standards and interpretations). These forward-looking statements express our
expectations, hopes, beliefs and intentions regarding the future. In addition,
without limiting the foregoing, any statements that refer to projections,
forecasts or other characterizations of future events or circumstances,
including any underlying assumptions, are forward-looking statements.
The words anticipates, believes, continue, could, estimates, expects,
intends, may, might, plans, possible, potential, predicts, projects, seeks,
should, will, would and similar expressions and variations, or comparable
terminology, or the negatives of any of the foregoing, may identify forward-
looking statements, but the absence of these words does not mean that a
statement is not forward-looking.
The forward-looking statements contained in this Offering Circular
are based on current expectations and beliefs concerning future developments
that are difficult to predict. We cannot guarantee future performance, or
that future developments affecting our company will be as currently
anticipated. These forward-looking statements involve a number of risks,
uncertainties (some of which are beyond our control) or other assumptions
that may cause actual results or performance to be materially different
from those expressed or implied by these forward-looking statements.
All forward-looking statements attributable to us are expressly qualified
in their entirety by these risks and uncertainties. These risks and
uncertainties, along with others, are also described below in the Risk Factors
section. Should one or more of these risks or uncertainties materialize, or
should any of our assumptions prove incorrect, actual results may vary in
material respects from those projected in these forward-looking statements.
You should not place undue reliance on any forward-looking statements and
should not make an investment decision based solely on these forward-looking
statements. We undertake no obligation to update or revise any forward-looking
statements, whether as a result of new information, future events or
otherwise, except as may be required under applicable securities laws.
OFFERING CIRCULAR SUMMARY
The following summary highlights material information contained in this Offering
Circular. This summary does not contain all of the information you should consider
before purchasing our common stock. Before making an investment decision, you
should read this Offering Circular carefully, including the Risk Factors section and
the unaudited consolidated financial statements and the notes thereto. Unless
otherwise indicated, the terms we, us and our refer and relate to Clikia Corp., a
Nevada corporation, including its sole subsidiary, Clikia Corp., a Louisiana
corporation (Clikia-LA).
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Our Company
Clikia Corp. was incorporated in 2002 in the State of Nevada, under the name MK
Automotive, Inc. Our corporate name changed to Clikia Corp. in July 2017. From 2002
through 2015, our company was engaged in the retail and commercial automotive
diagnostic, maintenance and repair services businesses, and, from December 2015
through January 2017, we pursued the commercial exploitation of Squuak.com, a
social media and content sharing tool and platform. Ultimately, these business
efforts were unsuccessful. In February 2017, our company acquired Clikia-LA, a
Baton Rouge, Louisiana-based over-the-top, or OTT, video streaming service provider,
and adopted the OTT video streaming business plan of Clikia-LA.
Our Business
ClikiaTV is our subscription-based streaming cable television service delivered via
our Clikia App, which is available in the iTunes Store, the Google Play Store, on
Amazon and Roku, and via Google Chromecast for any device, and through our
interconnected website, www.Clikia.com, that targets consumers who wish to join the
cord-cutting movement, the movement away from traditional cable and satellite
television subscriptions.
ClikiaTV competes in the over-the-top content (video) delivery industry. Over-the-
op, or OTT, is the term used to describe the delivery of film and TV content via
the internet, without requiring users to subscribe to a traditional cable or
satellite pay-TV service, like Comcast, Time Warner Cable or DirecTV.
Offering Summary
Securities Offered 1,250,000,000 shares of common stock, par
value $0.00001 (the Offered Shares).
Offering Price $0.0003 per Offered Share.
Shares Outstanding 627,814,672 shares issued and outstanding as
Before This Offering of the date hereof, with an additional 62,781,467
unissued shares underlying currently convertible
portions of outstanding convertible instruments.
Shares Outstanding 1,562,814,672 shares, with an additional 156,281,467
After This Offering unissued shares underlying currently convertible
portions of outstanding convertible debt instruments
and agreements.
Minimum Number of Shares None
to Be Sold in This Offering
Investor Suitability Standards The Offered Shares may only be purchased by investors
residing in a state in which this Offering Circular
in duly qualified who have either (a) a minimum
annual gross income of $70,000 and a minimum net
worth of $70,000, exclusive of automobile,
home and home furnishings, or (b) a minimum net
worth of $250,000, exclusive of automobile, home
and home furnishings.
Market for our Common Stock Our common stock is quoted on the OTC Pink under the
ticker symbol CLKA.
Termination of this Offering This offering will terminate at the earliest of (a)
the date on which the maximum offering has been sold,
(b) the date which is one year from this offering
being qualified by the SEC and (c) the date on which
this offering is earlier terminated by us, in our
sole discretion.
Use of Proceeds We will apply the proceeds of this offering for video
streaming rights acquisition, general and
administrative expenses, payroll expenses, investments
in, and/or acquisitions of, companies that we believe
would improve our ability to generate profits and
working capital. (See Use of Proceeds).
Risk Factors An investment in the Offered Shares involves a high
degree of risk and should not be purchased by
investors who cannot afford the loss of their entire
investments. You should carefully consider the
information included in the Risk Factors section of
this Offering Circular, as well as the other
information contained in this Offering Circular,
prior to making an investment decision regarding
the Offered Shares.
Corporate Information Our principal executive offices are located at 7117
Florida Boulevard, Suite 203, Baton Rouge, Louisiana
70806; our telephone number is 800/584/3808; our
corporate website is located at www.clikia.com.
No information found on our company's website
is part of this Offering Circular.
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Continuing Reporting Requirements Under Regulation A
As a Tier 1 issuer under Regulation A, we will be required to file with the SEC a
Form 1-Z (Exit Report Under Regulation A) upon the termination of this offering.
We will not be required to file any other reports with the SEC following this offering.
However, during the pendency of this offering and following this offering, we intend
to file quarterly and annual financial reports and other supplemental reports with
OTC Markets, which will be available at www.otcmarkets.com.
All of our future periodic reports, whether filed with OTC Markets or the SEC, will
not be required to include the same information as analogous reports required to
be filed by companies whose securities are listed on the NYSE or NASDAQ, for example.
RISK FACTORS
An investment in the Offered Shares involves substantial risks. You should carefully
consider the following risk factors, in addition to the other information contained
in this Offering Circular before purchasing any of the Offered Shares. The occurrence
of any of the following risks might cause you to lose a significant part of your
investment. The risks and uncertainties discussed below are not the only ones we
face, but do represent those risks and uncertainties that we believe are most
significant to our business, operating results, prospects and financial condition.
Some statements in this Offering Circular, including statements in the following
risk factors, constitute forward-looking statements. (See Cautionary Statement
Regarding Forward-Looking Statements).
Risks Related to Our Company
There is doubt about our ability to develop ClikiaTV as a viable business, and
we will need additional funding beyond this offering.
We have incurred operating losses over the past three years. Our current efforts
focused on bringing ClikiaTV to market have yet to yield meaningful revenues
or any profits. Recently, we have obtained certain financing that has aided
our ClikiaTV-related efforts, but such financing has not been sufficient to
allow us to pursue our complete plan of business. Further, there can be no
assurance that our ClikiaTV business will be successful.
We may be unable to obtain sufficient capital to pursue our growth strategy.
Currently, we do not have sufficient financial resources to implement our complete
business plan relating to the development of our ClikiaTV streaming cable television
subscription service. If this offering is successful, however, we expect that we
would, then, possess adequate capital with which to implement the initial facet
of our business plan, the marketing of ClikiaTV via social media platforms. There
is no assurance that we will sell any of the Offered Shares in this offering,
nor is there any assurance that our ClikiaTV business will be able to generate
revenues that are sufficient to sustain our operations. We are not able to offer
assurance that we will be able to obtain additional sources of financing, in
order to satisfy our working capital needs.
We do not have a successful operating history with respect to our ClikiaTV
streaming cable television subscription service.
We are without a history of operations in the OTT video streaming business, which
makes a purchase of the Offered Shares speculative in nature. Because of this
limited operating history, it is difficult to forecast our future operating results.
Additionally, our operations will be subject to risks inherent in the establishment
of a new business, including, among other factors, efficiently deploying our
capital, developing and implementing our marketing campaigns and strategies
and developing awareness and acceptance of our ClikiaTV streaming cable
television subscription service.
There are risks and uncertainties encountered by early-stage companies.
As an early-stage company, we are unable to offer assurance that we will be able
to overcome the lack of recognition for the ClikiaTV brand name and our lack
of capital.
We may not be successful in establishing our business model.
We are unable to offer assurance that we will be successful in establishing a
subscriber base with respect to our ClikiaTV streaming cable television
subscription service. Should we fail to implement successfully our business
plan, you can expect to lose your entire investment.
We may never earn a profit.
Because we lack a successful operating history in the OTT video streaming
business, we are unable to offer assurance that we will ever earn a profit
from our operations.
If we are unable to manage future expansion effectively, our business may be
adversely impacted.
In the future, we may experience rapid subscriber growth, which could place a
significant strain on our operations, in general, and our internal controls and
other managerial, operating and financial resources, in particular. If we are
unable to manage future expansion effectively, our business would be harmed.
There is, of course, no assurance that we will enjoy rapid development in
our business.
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We currently depend on the efforts of our executive officers' serving without
current compensation; the loss of these officers could disrupt our operations
and adversely affect the development of our ClikiaTV streaming cable
television business.
Our success in establishing our ClikiaTV streaming cable television subscription
service will depend, primarily, on the continued service of our CEO, David
Loflin. We have entered into an employment agreement with Mr. Loflin; however,
no payments have been made to him thereunder, due to our lack of operating
capital. Nevertheless, the loss of service of Mr. Loflin, for any reason, could
seriously impair our ability to execute our business plan, which could have a
materially adverse effect on our business and future results of operations. We
have not purchased any key-man life insurance. (See Certain Relationships
and Related Transactions).
If we are unable to recruit and retain key personnel, our business may be harmed.
If we are unable to attract and retain key personnel, our business may be harmed.
Our failure to enable the effective transfer of knowledge and facilitate smooth
transitions with regard to our key employees could adversely affect our
long-term strategic planning and execution.
Our business plan is not based on independent market studies.
We have not commissioned any independent market studies concerning the market
for our ClikiaTV streaming cable television subscription service. Rather, our
plans for implementing our business strategy and achieving profitability are
based on the experience, judgment and assumptions of our executive officers.
If these assumptions prove to be incorrect, we may not be successful in
further establishing ClikiaTV.
Our Board of Directors may change our policies without shareholder approval.
Our policies, including any policies with respect to investments, leverage,
financing, growth, debt and capitalization, will be determined by our Board
of Directors or officers to whom our Board of Directors delegates such
authority. Our Board of Directors will also establish the amount of any
dividends or other distributions that we may pay to our shareholders. Our
Board of Directors or officers to which such decisions are delegated will
have the ability to amend or revise these and our other policies at any time
without shareholder vote. Accordingly, our shareholders will not be entitled
to approve changes in our policies, which policy changes may have a material
adverse effect on our financial condition and results of operations.
Risks Related to Our Business
We may not be able to compete effectively in the OTT video streaming market.
The OTT video streaming industry has enjoyed explosive growth since the end
of 2015, and is an intensely competitive industry. Netflix, the leading video
streaming content provider, and Hulu are among the most well-known of our
competitors, as is AT&T, who has aggressively pursued video streaming market
share by bundling its DirecTV(R), AT&T Fibre(R) (inexpensive broadband
internet service) and cellular services. Many of our competitors, including
Netflix, Hulu and AT&T, possess substantially greater resources, financial
and otherwise, than does our company. No assurances can be given that we will
be able to compete successfully in the OTT video streaming industry.
Introduction of new products and services by competitors could harm our
competitive position and results of operations.
The market for our ClikiaTV streaming cable television subscription service
is characterized by intense competition, evolving industry standards, evolving
business and distribution models, price cutting, with resulting downward
pressure on gross margins, and price sensitivity on the part of consumers.
Our future success will depend on our ability to gain recognition of the
ClikiaTV brand name and customer loyalty, as well as our being able to
anticipate and respond to emerging standards and other unforeseen changes.
If we fail to satisfy such standards of operation, our operating results
could suffer. Further, intra-industry consolidations may result in stronger
competitors and may, therefore, also harm our future results of operations.
If our efforts to attract and retain subscribers to our ClikiaTV streaming
cable television subscription service are not successful, our business will
be adversely affected.
Our ability to attract, and to continue to attract, subscribers to ClikiaTV
streaming cable television subscription service will depend, in part, on our
ability consistently to provide subscribers with compelling content choices,
as well as a quality experience for selecting and viewing ClikiaTV's content.
If consumers do not perceive ClikiaTV to be of value, we may not be able to
attract and retain subscribers. If we do not grow as expected, we may not be
able to adjust our expenditures or increase our (per subscriber) revenues
commensurate with the lowered growth rate such that our margins, liquidity
and results of operation may be adversely impacted. If we are unable to compete
successfully with current and new competitors in both retaining existing
subscribers and attracting new subscribers, our business will be adversely
affected.
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Changes in competitive offerings for entertainment video, including the
potential rapid adoption of piracy-based video offerings, could adversely
impact our business.
The market for entertainment video is intensely competitive and subject to
rapid change. Through new and existing distribution channels, consumers have
increasing options through which to access entertainment video. The various
economic models underlying these channels include subscription, transactional,
ad-supported and piracy-based models. All of these have the potential to
capture meaningful segments of the entertainment video market. Piracy, in
particular, threatens to damage our business, as piracy renders virtually all
content free. Traditional providers of entertainment video, including
broadcasters and cable network operators, as well as internet based e-commerce
or entertainment video providers, are increasing their internet-based video
offerings. Several of these competitors have long operating histories, large
customer bases, strong brand recognition and significant financial, marketing
and other resources. As compared to our company, they may secure better
terms from suppliers, adopt more aggressive pricing and devote more resources
to product development, technology, infrastructure, content acquisitions and
marketing. New entrants may enter the market or existing providers may adjust
their services with unique offerings or approaches to providing entertainment
video. Companies also may enter into business combinations or alliances that
strengthen their competitive positions. If we are unable to compete successfully
or profitably with current and new competitors, our business will be adversely
affected, and we may not be able to increase or maintain market share, revenues
or profitability.
If we fail to maintain a positive reputation with consumers concerning our
ClikiaTV streaming cable television subscription service, including the content
offered, we may not be able to attract or retain subscribers, and our operating
results may be adversely affected.
We believe that a positive reputation with consumers concerning our ClikiaTV
streaming cable television subscription service is highly important in attracting
and retaining subscribers who have a number of choices from which to obtain
entertainment video. To the extent the ClikiaTV content is perceived as low
quality, offensive or otherwise not compelling to consumers, our ability to
establish and maintain a positive reputation may be adversely impacted.
If studios, content providers or other rights holders refuse to license streaming
content or other rights upon terms acceptable to our company, our business could
be adversely affected.
Our ability to provide ClikiaTV subscribers with streaming content depends on
studios', content providers' and other rights holders' licensing rights to
distribute such content and certain related elements thereof. The license
periods and the terms and conditions of such licenses vary. If the studios,
content providers and other rights holders are not or are no longer willing or
able to license our company content upon terms acceptable to us, our ability to
stream content to ClikiaTV subscribers will be adversely affected and/or our
costs could increase. As competition increases, the cost of programming can
be expected to increase. Also, we focus on providing an overall mix of content
that engages subscribers in a cost-efficient manner. If we do not maintain a
compelling mix of content, it can be expected that our subscriber acquisition
and retention may be adversely affected.
Any significant disruption in, or unauthorized access to, our computer systems
or those of third parties utilized in our operations, including those relating
to cybersecurity or arising from cyber-attacks, could result in a loss or
degradation of service, unauthorized disclosure of data, including subscriber
information, or theft of intellectual property, which could adversely impact
our business.
ClikiaTV's reputation and ability to attract, retain and serve subscribers is
dependent upon the reliable performance and security of our computer systems
and those of third parties utilized in our operations. These systems may be
subject to damage or interruption from earthquakes, adverse weather conditions,
other natural disasters, terrorist attacks, power loss, telecommunications
failures and cybersecurity risks. Interruptions in these systems, or with
the internet in general, could make ClikiaTV unavailable or degraded or
otherwise hinder our ability to deliver ClikiaTV. Service interruptions,
errors in software or the unavailability of computer systems used in
operations could diminish the overall attractiveness of ClikiaTV to existing
and potential subscribers.
Our computer systems and those of third parties used in our operations are
vulnerable to cybersecurity risks, including computer viruses, physical or
electronic break-ins and similar disruptions. Any attempt by hackers to
obtain our data or intellectual property, disrupt ClikiaTV, or otherwise
access to our systems, or those of associated third parties, if successful,
could harm our business, be expensive to remedy and damage our reputation.
We have implemented certain systems and processes to thwart hackers and
protect our data and systems. Any significant disruption to ClikiaTV could
result in a loss of subscribers and adversely affect our business and
results of operation.
A recent Federal Communications Commission (FCC) vote to remove exiting net
neutrality rules could have a negative effect on our ClikiaTV streaming cable
television subscription service, in the long term.
The FCC's December 2017 vote to remove existing net neutrality rules marks
a reversal from the FCC's position during the Obama Administration. The FCC's
current position against net neutrality represents a free market approach to
the internet, while the position of the Obama Administration (as well as most
other nations) favored a regulatory structure that established an even playing
field for both internet service provider (ISP) and user, that is, control of
the content would not be in the hands of free-market participants.
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Critics of the FCC's current position against net neutrality argue that its
current position will, ultimately, lead to a monopolistic, anti-competitive
environment that impairs consumer choice. For example, without a net neutrality
regulatory scheme, it is argued, a consumer's ISP could offer a particular
video streaming service for free, while charging the consumer for streaming
ClikiaTV. It is also speculated by these critics that a consumer will, over
time, be forced to subscribe to the internet TV service offered by such
consumer's ISP.
To date, we have noticed no impact from the recent FCC vote to remove existing
net neutrality rules. However, you should be aware of the possibility that
ClikiaTV may not be able to compete successfully as the internet's control
and regulatory environment evolves.
Changes by network operators in how they handle and charge for access to data
that travels across their networks could adversely impact our business.
We rely upon the ability of consumers to access ClikiaTV through the internet.
If network operators block, restrict or otherwise impair access to ClikiaTV
over their networks, our ClikiaTV streaming cable television subscription
service and business could be negatively affected. It is possible that the
FCC's recent removal of net neutrality rules could lead to such circumstances.
To the extent that network operators implement usage-based pricing, including
meaningful bandwidth caps, or otherwise try to monetize access to their
networks by data providers, we could incur greater operating expenses and our
subscriber acquisition and retention could be negatively impacted.
If government regulations relating to the internet or other areas of our
business change, we may need to alter the manner in which we conduct our
business, or incur greater operating expenses.
The adoption or modification of laws or regulations relating to the internet
or other areas of our business could limit or otherwise adversely affect the
manner in which we currently conduct our business. In addition, the continued
growth and development of the market for online commerce may lead to more
stringent consumer protection laws, which may impose additional burdens on
us. If we are required to comply with new regulations or legislation or new
interpretations of existing regulations or legislation, this compliance could
cause us to incur additional expenses or alter our business model.
Privacy concerns could limit our ability to collect and leverage our subscriber
data and disclosure of subscriber data could adversely impact our business and
reputation.
In the ordinary course of business, we collect and utilize data supplied by
ClikiaTV subscribers. We currently face certain legal obligations regarding the
manner in which we treat such information. Other businesses have been criticized
by privacy groups and governmental bodies for attempts to link personal
identities and other information to data collected on the internet regarding
users' browsing and other habits. Increased regulation of data utilization
practices, including self-regulation or findings under existing laws that limit
its ability to collect, transfer and use data, could have an adverse effect on
our business.
Our reputation and our relationships with ClikiaTV subscribers would be harmed
if subscriber data, particularly billing data, were to be accessed by
unauthorized persons.
We maintain personal data regarding ClikiaTV subscribers, including names and
billing data. Currently, this data is maintained on third-party systems. With
respect to billing data, such as credit card numbers, we rely on licensed
encryption and authentication technology to secure such information. Measures
are taken to protect against unauthorized intrusion into ClikiaTV subscribers'
data. Despite these measures, our third-party payment processing services could
experience an unauthorized intrusion into ClikiaTV subscribers' data. In the
event of such a breach, current and potential ClikiaTV subscribers may become
unwilling to provide the information necessary for them to become ClikiaTV
subscribers. Additionally, we could face legal claims or regulatory fines or
penalties for such a breach. The costs relating to any data breach could be
material, and we currently do not carry insurance against the risk of a data
breach. For these reasons, should an unauthorized intrusion into ClikiaTV
subscribers' data occur, our business could be adversely affected.
We are subject to payment processing risk.
ClikiaTV subscribers pay their monthly fees using credit/debit cards.
Currently, we rely on third parties to process payment. Acceptance and
processing of these payment methods are subject to certain rules and
regulations and require payment of interchange and other fees. To the extent
there are disruptions in our payment processing systems, our revenue,
operating expenses and results of operation could be adversely impacted.
If our trademarks and other proprietary rights are not adequately protected to
prevent use or appropriation by competitors, the value of the ClikiaTV brand
may be diminished, and our business adversely affected.
We rely, and expect to continue to rely, on a combination of confidentiality
and license agreements with employees, consultants and third parties with whom
we have relationships, as well as trademark, copyright, patent and trade secret
protection laws, to protect our proprietary rights. If the protection of our
intellectual property rights is inadequate to prevent use or misappropriation
by third parties, the value of the ClikiaTV brand may be diminished, competitors
may be able to more effectively mimic our video streaming service and methods of
operations, the perception of the ClikiaTV business and service to subscribers
and potential subscribers may become confused in the marketplace, and our
ability to attract ClikiaTV subscribers may be adversely affected.
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Risks Related to Compliance and Regulation
The Offered Shares are offered pursuant to Regulation A promulgated pursuant
to the Jumpstart Our Business Startups Act of 2012 (the JOBS Act); we cannot
be certain if the reduced disclosure requirements applicable to Tier 1 issuers
will diminish the attractiveness of the Offered Shares to investors.
As a Tier 1 issuer, we will be subject to scaled disclosure and reporting
requirements, which may make an investment in the Offered Shares less attractive
to investors who are accustomed to enhanced disclosure and more frequent
financial reporting. In addition, given the relative lack of regulatory
precedence regarding the recent amendments to Regulation A, there is a
significant amount of regulatory uncertainty in regards to how the SEC or the
individual state securities regulators will regulate both the offer and sale of
the Offered Shares, as well as any ongoing compliance to which we may be subject.
If our scaled disclosure and reporting requirements, or regulatory uncertainty
regarding Regulation A, reduces the attractiveness of the Offered Shares, we may
be unable to raise the funds necessary to implement our planned business
development activities, which could severely affect the value of our common stock.
We will not have reporting obligations under Sections 14 or 16 of the Securities
Exchange Act of 1934, nor will any shareholders have reporting requirements of
Regulation 13D or 13G, nor Regulation 14D.
So long as our common shares are not registered under the Exchange Act, our
directors and executive officers and beneficial holders of 10% or more of our
outstanding common shares will not be subject to Section 16 of the Exchange Act.
Section 16(a) of the Exchange Act requires executive officers and directors and
persons who beneficially own more than 10% of a registered class of equity
securities to file with the SEC initial statements of beneficial ownership,
reports of changes in ownership and annual reports concerning their ownership of
common shares and other equity securities, on Forms 3, 4 and 5, respectively.
Such information about our directors, executive officers and beneficial holders
will only be available through this (and any subsequent) offering statement, as
well as periodic reports we file with OTC Markets.
Our common stock is not registered under the Exchange Act and we do not intend to
register our common stock under the Exchange Act for the foreseeable future;
provided, however, that we will register our common stock under the Exchange Act
if we have, after the last day of any fiscal year, more than either (i) 2000
persons; or (ii) 500 shareholders of record who are not accredited investors,
in accordance with Section 12(g) of the Exchange Act.
Further, as long as our common stock is not registered under the Exchange Act,
we will not be subject to Section 14 of the Exchange Act, which, among other
things, prohibits companies that have securities registered under the Exchange
Act from soliciting proxies or consents from shareholders without furnishing to
shareholders and filing with the SEC a proxy statement and form of proxy
complying with the proxy rules.
The reporting required by Section 14(d) of the Exchange Act provides information
to the public about persons other than the company who is making the tender
offer. A tender offer is a broad solicitation by a company or a third party to
purchase a substantial percentage of a company's common stock for a limited period
of time. This offer is for a fixed price, usually at a premium over the current
market price, and is customarily contingent on shareholders tendering a fixed
number of their shares.
In addition, as long as our common stock is not registered under the Exchange Act,
our company will not be subject to the reporting requirements of Regulation 13D
and Regulation 13G, which require the disclosure of any person who, after acquiring
directly or indirectly the beneficial ownership of any equity securities of a
class, becomes, directly or indirectly, the beneficial owner of more than 5%
of the class.
Our use of Form 1-A and our reliance on Regulation A for this offering may make
it more difficult to raise capital as and when we need it, as compared to our
conducting a traditional initial public offering on Form S-1.
Because of the exemptions from various reporting requirements provided to us under
Regulation A and because we are only permitted to raise up to $20.0 million in
any 12-month period under Regulation A (although we may raise capital in other
ways), our company may be less attractive to investors and it may be difficult for
us to raise additional capital as and when we need it. Prospective investors may
be unable to compare our business with other companies in our industry, if they
believe that our financial accounting is not as transparent as other companies in
our industry. If we are unable to raise additional capital as and when we need it,
our financial condition and results of operations may be materially and adversely
affected.
-8-
There may be deficiencies with our internal controls that require improvements.
As a Tier 1 issuer, we will not need to provide a report on the effectiveness of our
internal controls over financial reporting and we will be exempt from any
independent auditor attestation requirements concerning any such report, so long as
we are a Tier 1 issuer. We are in the process of evaluating whether our internal
control procedures are effective and, therefore, there is a greater likelihood of
undiscovered errors in our internal controls or reported financial statements as
compared to issuers that have conducted such independent evaluations.
Risks Related to Our Organization and Structure
As a non-listed company conducting an exempt offering pursuant to Regulation A, we
are not subject to a number of corporate governance requirements, including the
requirements for independent board members.
As a non-listed company conducting an exempt offering pursuant to Regulation A, we
are not subject to a number of corporate governance requirements that an issuer
conducting an offering on Form S-1 or listing on a national stock exchange would
be. Accordingly, we are not required to have (a) a board of directors of which
a majority consists of independent directors under the listing standards of a
national stock exchange, (b) an audit committee composed entirely of independent
directors and a written audit committee charter meeting a national stock exchange's
requirements, (c) a nominating/corporate governance committee composed entirely of
independent directors and a written nominating/ corporate governance committee charter
meeting a national stock exchange's requirements, (d) a compensation committee
composed entirely of independent directors and a written compensation committee
charter meeting the requirements of a national stock exchange, and (e) independent
audits of our internal controls. Accordingly, you may not have the same protections
afforded to shareholders of companies that are subject to all of the corporate
governance requirements of a national stock exchange.
Our holding company structure makes us dependent on our current subsidiary, and
future subsidiaries, for our cash flow and subordinates the rights of our
shareholders to the rights of creditors of our current subsidiary, and future
subsidiaries, in the event of an insolvency or liquidation of any such subsidiary.
Our company, Clikia Corp., is a holding company and, accordingly, substantially all
of our operations are currently conducted through our current subsidiary and, in the
future, will be conducted through additional subsidiaries. Such subsidiaries are and
will be separate and distinct legal entities. As a result, our cash flow depends and
will depend upon the earnings of our subsidiaries. In addition, we depend and will
depend on the distribution of earnings, loans or other payments by our subsidiaries.
No subsidiary has or will have any obligation to provide our company with funds for
our payment obligations. If there is an insolvency, liquidation or other
reorganization of any of our subsidiaries, our shareholders will have no right to
proceed against their assets. Creditors of those subsidiaries will be entitled to
payment in full from the sale or other disposal of the assets of those subsidiaries
before our company, as a shareholder, would be entitled to receive any distribution
from that sale or disposal.
Risks Related to a Purchase of the Offered Shares
There is no minimum offering and no person has committed to purchase any of the
Offered Shares.
We have not established a minimum offering hereunder, which means that we will be
able to accept even a nominal amount of proceeds, even if such amount of proceeds
is not sufficient to permit us to achieve any of our business objectives. In this
regard, there is no assurance that we will sell any of the Offered Shares or that
we will sell enough of the Offered Shares necessary to achieve any of our business
objectives. Additionally, no person is committed to purchase any of the Offered
Shares.
We have outstanding convertible debt instruments that could negatively affect the
market price of our common stock.
Certain of our outstanding convertible debt instruments could negatively affect
the market price of our common stock, should their respective exercise prices,
at the time of exercise, be lower than the then-market price of our common stock.
We are unable, however, to predict the actual effect that the conversion of any
such convertible debt instruments would have on the market price of our common
stock.
We may seek additional capital that may result in shareholder dilution or that
may have rights senior to those of our common stock.
From time to time, we may seek to obtain additional capital, either through equity,
equity-linked or debt securities. The decision to obtain additional capital will
depend on, among other factors, our business plans, operating performance and
condition of the capital markets. If we raise additional funds through the issuance
of equity, equity-linked or debt securities, those securities may have rights,
preferences or privileges senior to the rights of our common stock, which could
negatively affect the market price of our common stock or cause our shareholders
to experience dilution.
You may never realize any economic benefit from a purchase of Offered Shares.
Because the market for our common stock is volatile, there is no assurance that
you will ever realize any economic benefit from your purchase of Offered Shares.
-9-
We do not intend to pay dividends on our common stock.
We intend to retain earnings, if any, to provide funds for the implementation of
our business strategy. We do not intend to declare or pay any dividends in the
foreseeable future. Therefore, there can be no assurance that holders of our common
stock will receive cash, stock or other dividends on their shares of our common
stock, until we have funds which our Board of Directors determines can be allocated
to dividends.
Our shares of common stock are Penny Stock, which may impair trading liquidity.
Disclosure requirements pertaining to penny stocks may reduce the level of trading
activity in the market for our common stock and investors may find it difficult to
sell their shares. Trades of our common stock will be subject to Rule 15g-9 of the
SEC, which rule imposes certain requirements on broker-dealers who sell securities
subject to the rule to persons other than established customers and accredited
investors. For transactions covered by the rule, broker-dealers must make a special
suitability determination for purchasers of the securities and receive the
purchaser's written agreement to the transaction prior to sale. The SEC also has
rules that regulate broker-dealer practices in connection with transactions in penny
stocks. Penny stocks generally are equity securities with a price of less than $5.00
(other than securities registered on certain national securities exchanges or quoted
on the NASDAQ system, provided that current price and volume information with respect
to transactions in that security is provided by the exchange or system). The penny
stock rules require a broker-dealer, prior to a transaction in a penny stock not
otherwise exempt from the rules, to deliver a standardized risk disclosure document
that provides information about penny stocks and the nature and level of risks in the
penny stock market. The broker-dealer also must provide the customer with current bid
and offer quotations for the penny stock, the compensation of the broker-dealer and
its salesperson in the transaction, and monthly account statements showing the market
value of each penny stock held in the customer's account. The bid and offer quotations,
and the broker-dealer and salesperson compensation information, must be given to the
customer orally or in writing prior to effecting the transaction and must be given to
the customer in writing before or with the customer's confirmation.
Our common stock is thinly traded and its market price may become highly volatile.
There is currently only a limited market for our common stock. A limited market is
characterized by a relatively limited number of shares in the public float, relatively
low trading volume and a small number of brokerage firms acting as market makers. The
market for low priced securities is generally less liquid and more volatile than
securities traded on national stock markets. Wide fluctuations in market prices are
not uncommon. No assurance can be given that the market for our common stock will
continue. The price of our common stock may be subject to wide fluctuations in response
to factors such as the following, some of which are beyond our control:
- quarterly variations in our operating results;
- operating results that vary from the expectations of investors;
- changes in expectations as to our future financial performance, including financial
estimates by investors;
- reaction to our periodic filings, or presentations by executives at investor and
industry conferences;
- changes in our capital structure;
- changes in market valuations of other internet or online entertainment companies;
- announcements of innovations or new services by us or our competitors;
- announcements by us or our competitors of significant contracts, acquisitions,
strategic partnerships, joint ventures or capital commitments;
- lack of success in the expansion of our business operations;
- announcements by third parties of significant claims or proceedings against our
company or adverse developments in pending proceedings;
- additions or departures of key personnel;
- asset impairment;
- temporary or permanent inability to offer products or services; and
- rumors or public speculation about any of the above factors.
The terms of this offering were determined arbitrarily.
The terms of this offering were determined arbitrarily by us. The offering price for
the Offered Shares does not necessarily bear any relationship to our company's assets,
book value, earnings or other established criteria of valuation. Accordingly, the
offering price of the Offered Shares should not be considered as an indication of
any intrinsic value of such securities. (See Dilution).
Future sales of our common stock, or the perception in the public markets that these
sales may occur, could reduce the market price of our common stock.
Our officers and directors hold shares of our restricted common stock, but will be
able to sell their shares in the market if one should develop. In general, our
officers and directors and major shareholders, as affiliates, under Rule 144 may not
sell more than one percent of the total issued and outstanding shares in any 90-day
period, and must resell the shares in an unsolicited brokerage transaction at the
market price. The availability for sale of substantial amounts of our common stock
under Rule 144 or otherwise could reduce prevailing market prices for our common
stock.
As of the date of this Offering Circular, there is a total of 873,204,859 shares
of our common stock reserved for issuance upon conversion of the currently convertible
portions of convertible debt instruments and pursuant to agreements. All such shares
constitute an overhang on the market for our common stock and, if and when issued,
will be issued without transfer restrictions, pursuant to certain exemptions from
registration, and could reduce prevailing market prices for our common stock. Also,
in the future, we may also issue securities in connection with our obtaining needed
capital or an acquisition transaction. The amount of shares of our common stock
issued in connection with any such transaction could constitute a material portion
of our then-outstanding shares of common stock.
-10-
The outstanding shares of our Series A Super-Voting Preferred Stock effectively
preclude current and future owners of our common stock from influencing any
corporate decision.
Our CEO, David Loflin, through his ownership of RioRoca Holdings, LLC, controls 100%
of the outstanding shares of our Series A Super Voting Preferred Stock. The Series A
Super Voting Preferred Stock has 500 times that number of votes on all matters
submitted to the holders of our common stock and votes together with the holders of
our common stock as a single class. Mr. Loflin will, therefore, be able to control
the management and affairs of our company, as well as matters requiring the approval
by our shareholders, including the election of directors, any merger, consolidation or
sale of all or substantially all of our assets, and any other significant corporate
transaction. His control of the outstanding Series A Super Voting Preferred Stock may
also delay or prevent a future change of control of our company at a premium price,
if he opposes it.
You will suffer dilution in the net tangible book value of the Offered Shares you
purchase in this offering.
If you acquire any Offered Shares, you will suffer immediate dilution, due to the
lower book value per share of our common stock compared to the purchase price of the
Offered Shares in this offering. (See Dilution).
As an issuer of penny stock, the protection provided by the federal securities laws
relating to forward looking statements does not apply to us.
Although federal securities laws provide a safe harbor for forward-looking statements
made by a public company that files reports under the federal securities laws, this
safe harbor is not available to issuers of penny stocks. As a result, we will not
have the benefit of this safe harbor protection in the event of any legal action
based upon a claim that the material provided by us contained a material misstatement
of fact or was misleading in any material respect because of our failure to include
any statements necessary to make the statements not misleading. Such an action could
hurt our financial condition.
DILUTION
Dilution in net tangible book value per share to purchasers of our common stock in
this offering represents the difference between the amount per share paid by purchasers
of the Offered Shares in this offering and the net tangible book value per share
immediately after completion of this offering. In this offering, dilution is
attributable primarily to our negative net tangible book value per share.
If you purchase Offered Shares in this offering, your investment will be diluted to
the extent of the difference between your purchase price per Offered Share and the
net tangible book value of our common stock after this offering. Our net tangible book
value as of December 31, 2017, was $(623,885) (unaudited), or $(0.00) per share. Net
tangible book value per share is equal to total assets minus the sum of total
liabilities and intangible assets divided by the total number of shares outstanding.
The tables below illustrate the dilution to purchasers of Offered Shares in this
offering, on a pro forma basis, assuming 100%, 75%, 50% and 25% of the Offered
Shares are sold.
Assuming the Sale of 100% of the Offered Shares
Assumed offering price per share $0.0003
Net tangible book value per share as of December 31, 2017 (unaudited) $(0.00)
Increase in net tangible book value per share after giving effect to this offering $0.00
Pro forma net tangible book value per share as of December 31, 2017 (unaudited) $0.00
Dilution in net tangible book value per share to purchasers of Offered
Shares in this offering $0.0003
Assuming the Sale of 75% of the Offered Shares
Assumed offering price per share $0.0003
Net tangible book value per share as of December 31, 2017 (unaudited) $(0.00)
Increase in net tangible book value per share after giving effect to this offering $0.00
Pro forma net tangible book value per share as of December 31, 2017 (unaudited) $0.00
Dilution in net tangible book value per share to purchasers of Offered
Shares in this offering $0.0003
-11-
Assuming the Sale of 50% of the Offered Shares
Assumed offering price per share $0.0003
Net tangible book value per share as of December 31, 2017 (unaudited) $(0.00)
Increase in net tangible book value per share after giving effect to this offering $0.00
Pro forma net tangible book value per share as of December 31, 2017 (unaudited) $(0.00)
Dilution in net tangible book value per share to purchasers of Offered
Shares in this offering $0.0003
Assuming the Sale of 25% of the Offered Shares
Assumed offering price per share $0.0003
Net tangible book value per share as of December 31, 2017 (unaudited) $(0.00)
Increase in net tangible book value per share after giving effect to this offering $0.00
Pro forma net tangible book value per share as of December 31, 2017 (unaudited) $(0.00)
Dilution in net tangible book value per share to purchasers of Offered
Shares in this offering $0.0003
USE OF PROCEEDS
The table below sets forth the estimated proceeds we would derive from this offering,
assuming the sale of 25%, 50%, 75% and 100% of the Offered Shares and assuming
the payment of no sales commissions or finder's fees. There is, of course, no guaranty
that we will be successful in selling any of the Offered Shares in this offering.
Assumed Percentage of Offered Shares Sold in This Offering
25% 50% 75% 100%
___________ ___________ ___________ _____________
Number of Offered Shares sold 312,500,000 625,000,000 937,500,000 1,250,000,000
Gross proceeds $250,000 $500,000 $750,000 $1,000,000
Offering expenses 25,000 25,000 25,000 25,000
Proceeds to our company $225,000 $475,000 $725,000 $975,000
The table below sets forth the manner in which we intend to apply the net proceeds
derived by us in this offering, assuming the sale of 25%, 50%, 75% and 100% of the
Offered Shares. All amounts set forth below are estimates.
Use of Proceeds for Assumed Percentage of Offered Shares Sold in This Offering
25% 50% 75% 100%
_______ _______ _______ _______
Non-Management Personnel Payroll Expense $25,000 $50,000 $50,000 $50,000
General and Administrative Expense 50,000 75,000 100,000 150,000
Marketing Expense (1) 100,000 150,000 300,000 425,000
Investments/Acquisitions (2) --- --- --- 50,000
Repayment of Indebtedness --- 90,000(3) 150,000(4)185,000(5)
Channel Acquisition 20,000 50,000 50,000 65,000
Working Capital 30,000 60,000 75,000 100,000
________ ________ ________ ________
TOTAL $225,000 $475,000 $725,000 $975,000
____________________________________________________________
(1) Marketing efforts are anticipated to be a blend of social media marketing strategies
(approximately 90%) and traditional marketing channels (approximately 10%),
including radio, print and television.
(2) We currently have no agreement or other understanding, written or oral, with
respect to any investment in, and/or acquisition of any other company. Should we fail
to make any such investment and/or acquisition, the funds designated for such investment
would be applied to working capital.
(3) The indebtedness to be repaid with such proceeds includes the following: (a) a loan
of $30,000 by a third party, which debt, incurred in November 2017, is due in November
2018, provided that such debt is due and payable if and when we obtain sufficient funds
pursuant to this offering; the promissory note underlying such indebtedness is
convertible into shares of our common stock at a 50% percent discount to the then-market
price of our common stock; the proceeds from this loan were applied to operating
expenses; and (b) $60,000 to a third party, which debt, incurred in November 2017, is
due in January 2018; the promissory note underlying such indebtedness was issued to a
third party as partial consideration for our purchase of 45% of LiveSpeed Baton Rouge
#1, LLC (see Certain Transactions).
(4) The indebtedness to be repaid with such proceeds includes the items listed in
footnote 3, as well as the following: $60,000 to a third party, which debt, incurred
in November 2017, is due in January 2018; the promissory note underlying such
indebtedness was issued to a third party as partial consideration for our purchase of
45% of LiveSpeed Baton Rouge #2, LLC (see Certain Transactions).
(5) The indebtedness to be repaid with such proceeds includes the items listed in
footnotes 3 and 4, as well as the following: (a) a loan of $25,000 by a third party,
which debt, incurred in February 2017, is due in February 2018; the promissory note
underlying such indebtedness is convertible into shares of our common stock at a
55% percent discount to the then-market price of our common stock; the proceeds from
this loan were applied to operating expenses; and (b) a loan of $10,000 by a third
party, which debt, incurred in March 2017, is due in March 2018; the promissory note
underlying such indebtedness is convertible into shares of our common stock at a per
share rate of $0.00166; the proceeds from this loan were applied to operating expenses.
-12-
We reserve the right to change the foregoing use of proceeds, should our management
believe it to be in the best interest of our company. The allocations of the proceeds
of this offering presented above constitute the current estimates of our management
and are based on our current plans, assumptions made with respect to the OTT industry,
general economic conditions and our future revenue and expenditure estimates.
Investors are cautioned that expenditures may vary substantially from the
estimates presented above. Investors must rely on the judgment of our management, who
will have broad discretion regarding the application of the proceeds of this offering.
The amounts and timing of our actual expenditures will depend upon numerous factors,
including market conditions, cash generated by our operations (if any), business
developments and the rate of our growth. We may find it necessary or advisable to use
portions of the proceeds of this offering for other purposes.
In the event we do not obtain the entire offering amount hereunder, we may attempt to
obtain additional funds through private offerings of our securities or by borrowing
funds. Currently, we do not have any committed sources of financing.
PLAN OF DISTRIBUTION
In General
Our company is offering a maximum of 1,250,000,000 Offered Shares on a best-efforts
basis, at a fixed price of $0.0003 per Offered Share; and funds derived from this
offering will be immediately available to us for our use. There will be no refunds.
This offering will terminate at the earliest of (a) the date on which the maximum
offering has been sold, (b) the date which is one year from this offering being
qualified by the SEC or (c) the date on which this offering is earlier terminated
by us, in our sole discretion.
There is no minimum number of Offered Shares that we are required to sell in this
offering. All funds derived by us from this offering will be immediately available
for use by us, in accordance with the uses set forth in the Use of Proceeds section
of this Offering Circular. No funds will be placed in an escrow account during the
offering period and no funds will be returned, once an investor's subscription
agreement has been accepted by us.
We intend to sell the Offered Shares in this offering through the efforts of our
Chief Executive Officer, David Loflin. Mr. Loflin will not receive any compensation
for offering or selling the Offered Shares. We believe that Mr. Loflin is exempt
from registration as a broker-dealers under the provisions of Rule 3a4-1
promulgated under the Securities Exchange Act of 1934 (the Exchange Act). In
particular, Mr. Loflin:
- is not subject to a statutory disqualification, as that term is defined in
Section 3(a)(39) of the Securities Act; and
- is not to be compensated in connection with his participation by the payment of
commissions or other remuneration based either directly or indirectly on
transactions in securities; and
- is not an associated person of a broker or dealer; and
- meets the conditions of the following:
- primarily performs, and will perform at the end of this offering, substantial
duties for us or on our behalf otherwise than in connection with transactions
in securities; and
- was not a broker or dealer, or an associated person of a broker or dealer,
within the preceding 12 months; and
- did not participate in selling an offering of securities for any issuer more
than once every 12 months other than in reliance on paragraphs (a)(4)(i) or
(iii) of Rule 3a4-1 under the Exchange Act.
-13-
As of the date of this Offering Circular, we have not entered into any agreements
with selling agents for the sale of the Offered Shares. However, we reserve the
right to engage FINRA-member broker-dealers. In the event we engage FINRA-member
broker-dealers, we expect to pay sales commissions of up to 7.0% of the gross
offering proceeds from their sales of the Offered Shares. In connection with
our appointment of a selling broker-dealer, we intend to enter into a standard
selling agent agreement with the broker-dealer pursuant to which the broker-
ealer would act as our non-exclusive sales agent in consideration of our payment
of commissions of up to 7% on the sale of Offered Shares effected by the broker-
dealer.
Procedures for Subscribing
If you are interested in subscribing for Offered Shares in this offering, please
go to www.clikiarega.com and electronically receive and review the information
set forth on such website.
Thereafter, should you decide to subscribe for Offered Shares, you are required
to follow the procedures described therein, which are:
- Electronically execute and deliver to us a subscription agreement; and
- Deliver funds directly by check or by wire or electronic funds transfer
via ACH to our specified bank account.
Right to Reject Subscriptions. After we receive your complete, executed subscription
agreement and the funds required under the subscription agreement have been
transferred to us, we have the right to review and accept or reject your
subscription in whole or in part, for any reason or for no reason. We will return
all monies from rejected subscriptions immediately to you, without interest or
deduction.
Acceptance of Subscriptions. Upon our acceptance of a subscription agreement, we
will countersign the subscription agreement and issue the Offered Shares subscribed.
Once you submit the subscription agreement and it is accepted, you may not revoke
or change your subscription or request your subscription funds. All accepted
subscription agreements are irrevocable.
This Offering Circular will be furnished to prospective investors upon their request
via electronic PDF format and will be available for viewing and download
24 hours per day, 7 days per week on our website at www.clikiarega.com, as well as
on the SEC's website, www.sec.gov.
An investor will become a shareholder of our company and the Offered Shares will
be issued, as of the date of settlement. Settlement will not occur until an
investor's funds have cleared and we accept the investor as a shareholder.
By executing the subscription agreement and paying the total purchase price for
the Offered Shares subscribed, each investor agrees to accept the terms of the
subscription agreement and attests that the investor meets certain minimum
financial standards. (See State Qualification and Investor Suitability Standards
below).
An approved trustee must process and forward to us subscriptions made through
IRAs, Keogh plans and 401(k) plans. In the case of investments through IRAs,
Keogh plans and 401(k) plans, we will send the confirmation and notice of our
acceptance to the trustee.
Minimum Purchase Requirements
You must initially purchase at least $300.00 of the Offered Shares in this
offering. If you have satisfied the minimum purchase requirement, any additional
purchase must be in an amount of at least $50.00.
State Law Exemption and Offerings to Qualified Purchasers
State Law Exemption. This Offering Circular does not constitute an offer to sell
or the solicitation of an offer to purchase any Offered Shares in any jurisdiction
in which, or to any person to whom, it would be unlawful to do so. An investment
in the Offered Shares involves substantial risks and possible loss by
investors of their entire investments. (See Risk Factors).
-14-
The Offered Shares have been qualified under the securities laws of New York and
Colorado and, accordingly, we plan to sell the Offered Shares only in such states.
However, we may, at a later date, decide to sell Offered Shares in other states.
In the case of each state in which we sell the Offered Shares, we will qualify
the Offered Shares for sale with the applicable state securities regulatory body
or we will sell the Offered Shares pursuant to an exemption from registration
found in the applicable state's securities, or Blue Sky, law.
Certain of our offerees may be broker-dealers registered with the SEC under the
Exchange Act, who may be interested in reselling the Offered Shares to others.
Any such broker-dealer will be required to comply with the rules and regulations
of the SEC and FINRA relating to underwriters.
Investor Suitability Standards. The Offered Shares may only be purchased by
investors residing in a state in which this Offering Circular in duly qualified
who have either (a) a minimum annual gross income of $70,000 and a minimum net
worth of $70,000, exclusive of automobile, home and home furnishings, or (b) a
minimum net worth of $250,000, exclusive of automobile, home and home furnishings.
Issuance of Certificates
Upon settlement, that is, at such time as an investor's funds have cleared and
we have accepted an investor's subscription agreement, we will issue a certificate
or certificates representing such investor's purchased Offered Shares.
Transferability of the Offered Shares
The Offered Shares will be generally freely transferable, subject to any
restrictions imposed by applicable securities laws or regulations.
Advertising, Sales and Other Promotional Materials
In addition to this Offering Circular, subject to limitations imposed by
applicable securities laws, we expect to use additional advertising, sales and
other promotional materials in connection with this offering. These materials
may include information relating to this offering, articles and publications
concerning industries relevant to our business operations or public
advertisements and audio-visual materials, in each case only as authorized by us.
In addition, the sales material may contain certain quotes from various
publications without obtaining the consent of the author or the publication for
use of the quoted material in the sales material. Although these materials will
not contain information in conflict with the information provided by this Offering
Circular and will be prepared with a view to presenting a balanced discussion of
risk and reward with respect to the Offered Shares, these materials will not give
a complete understanding of our company, this offering or the Offered Shares and
are not to be considered part of this Offering Circular. This offering is made
only by means of this Offering Circular and prospective investors must read and
rely on the information provided in this Offering Circular in connection with
their decision to invest in the Offered Shares.
DESCRIPTION OF SECURITIES
General
Our authorized capital stock consists of 3,450,000,000 shares of common stock,
$.00001 par value per share, and 5,000,000 shares of Series A Super Voting Preferred
Stock, $.00001 par value per share. As of the date of this Offering Circular, there
were 627,814,672 shares of our common stock issued and outstanding, held by 53
holders of record; a total of 873,204,859 shares of common stock reserved for
issuance upon conversion of the currently convertible portions of convertible debt
instruments and under agreements; and 2,000,000 shares of Series A Super Voting
Preferred Stock issued and outstanding.
-15-
Common Stock
The holders of our common stock currently have (a) equal ratable rights to dividends
from funds legally available therefore, when, as and if declared by our Board of
Directors; (b) are entitled to share ratably in all of our assets available for
distribution to holders of common stock upon liquidation, dissolution or winding up
of the affairs of our company; (c) do not have preemptive, subscriptive or
conversion rights and there are no redemption or sinking fund provisions or rights
applicable thereto; and (d) are entitled to one non-cumulative vote per share on all
matters on which shareholders may vote. Our Bylaws provide that, at all meetings of
the shareholders for the election of directors, a plurality of the votes cast shall
be sufficient to elect. On all other matters, except as otherwise required by Nevada
law or our Articles of Incorporation, as amended, a majority of the votes cast at a
meeting of the shareholders shall be necessary to authorize any corporate action to
be taken by vote of the shareholders.
Series A Super Voting Preferred Stock
Voting. Holders of the Series A Super Voting Preferred Stock have 500 times that number
of votes on all matters submitted to the shareholders that each shareholder of our
common stock is entitled to vote at each meeting of shareholders with respect to all
matters presented to the shareholders for their action or consideration. Holders of the
Series A Super Voting Preferred Stock shall vote together with the holders of our
common stock as a single class.
Our CEO, David Loflin, through his ownership of RioRoca Holdings, LLC, which owns all
of the issued and outstanding shares of Series A Super Voting Preferred Stock, controls
all corporate matters of our company. (See Security Ownership of Certain Beneficial
Owners and Management and Certain Transactions-RioRoca Holdings, LLC).
Dividends. Holders of Series A Super Voting Preferred Stock shall not be entitled to
receive dividends paid on the Company's common stock. Dividends paid to holders of
the Series A Super Voting Preferred Stock are at the discretion of the Company's Board
of Directors.
Liquidation Preference. Upon the liquidation, dissolution and winding up of the
Company, whether voluntary or involuntary, holders of the Series A Super Voting
Preferred Stock are not entitled to receive any of the assets of the Company.
No Conversion. The shares of Series A Super Voting Preferred Stock are not
convertible into shares of the Company's common stock.
Non-cumulative Voting
Holders of shares of our common stock do not have cumulative voting rights, which
means that the holders of more than 50% of the outstanding shares, voting for the
election of directors, can elect all of the directors to be elected, if they so choose,
and, in such event, the holders of the remaining shares will not be able to elect any
of our directors. As of the date of this Offering Circular, our officers and directors
will own a total of 120,254,675 shares, or approximately 19.15%, of our outstanding
common stock, which ownership percentage would be reduced to approximately 7.69%,
assuming all of the Offered Shares are sold in this offering.
However, our CEO, David Loflin, through his ownership of RioRoca Holdings, LLC, which
owns all of the issued and outstanding shares of Series A Super Voting Preferred
Stock, controls all corporate matters relating to our company. (See Security
Ownership of Certain Beneficial Owners and Management and Certain Transactions-
RioRoca Holdings, LLC).
Pre-emptive Rights
As of the date of this Offering Circular, no holder of any shares of our common
stock or Series A Super Voting Preferred Stock has pre-emptive or preferential
rights to acquire or subscribe for any unissued shares of any class of our capital
stock not disclosed herein.
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Dividend Policy
We have never declared or paid any dividends on our common stock. We currently
intend to retain future earnings, if any, to finance the expansion of our business.
As a result, we do not anticipate paying any cash diviends in the foreseeable
future.
Shareholder Meetings
Our bylaws provide that special meetings of shareholders may be called only by
our Board of Directors, the chairman of the board, or our president, or as
otherwise provided under Nevada law.
Transfer Agent
Pacific Stock Transfer Company is the transfer agent for our common stock.
Pacific Stock Transfer's address is 6725 Via Austi Parkway, Suite 300, Las Vegas,
Nevada 89119; its telephone number is 800/785/7782; its website is
www.pacificstocktransfer.com. No information found on Pacific Stock Transfer's
website is part of this Offering Circular.
BUSINESS
History
Our company was incorporated in 2002 in the State of Nevada, under the name MK
Automotive, Inc. Our corporate name changed to Clikia Corp., in July 2017.
From 2002 through 2015, the Company was engaged in the retail and commercial
automotive diagnostic, maintenance and repair services businesses. While
ultimately opening five company-operated locations and two franchise locations
in the greater Las Vegas, Nevada, metropolitan area, and two franchise locations
in St. Louis, Missouri, this business wound down by the end 2015. In December
2015, we acquired Squuak.com, a social media and content sharing tool and platform.
Despite significant efforts by our then-management, development of the Squuak.com
business model had not achieved the desired results by early 2017. In February 2017,
we acquired Clikia Corp. (Clikia-LA), a Baton Rouge, Louisiana-based OTT video
streaming service provider, and adopted the OTT video streaming business plan of
Clikia-LA.
Background
ClikiaTV, which is delivered to subscribers by and through the Clikia App, which
includes our interconnected Clikia.com website, competes in the over-the-op (OTT)
content delivery industry. Over-the-top is the term used to describe the delivery
of digital video and TV content via the internet to users, without requiring users
to subscribe to a traditional cable or satellite pay-TV service, like Comcast, Time
Warner Cable or DirecTV.
ClikiaTV subscribers are able to access and watch ClikiaTV's streaming cable
television content as much as they want, anytime, anywhere, on nearly any internet-
onnected device.
We believe ClikiaTV to be well positioned in a rapidly expanding industry segment.
Our initial strategy is to expand the ClikiaTV subscriber base in the United
States, within the parameters of our profit margin targets. In conjunction with these
efforts, we intend always to seek to improve the programming options available to
ClikiaTV subscribers.
Streaming
The term streaming refers to the delivery method of the medium, rather than the
medium itself. Today, streaming refers to situations in which an end-user watches
digital video content (or listens to digital audio) on a device over the internet.
With streaming content, the end-user is not required to download the entire digital
video or digital audio file before consuming the desired content, that is, the
desired content is continuously transmitted by a provider to, and received by, the
end-user.
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Video Delivery (Pay-TV) Industry
Over the past two years, the cable and satellite television industry has experienced
an accelerating level of disruption caused by consumers who are cutting the cord.
Cord-cutters are consumers who have cancelled their cable or satellite television
service, in favor of video services delivered by over-the-top (see discussion
below) providers.
Consumers who have cut-the-cord have done so for the following top three reasons:
- Price/Too expensive - 85.3%
- I use an internet streaming service, such as Netflix, Hulu,
Amazon Video, etc. - 45.7%
- I use an antenna to get the basic channels on my TV. - 21.8%
[Source: TiVo Q2 2017 Video Trends Report.]
Over-the-Top (OTT) Content Industry
Over-the-Top (OTT). In broadcasting, over-the-top content (OTT) is the audio, video
and other media content (e.g., television programming) transmitted, or delivered,
to an end-user over the internet, without the involvement of a multiple-system
operator. While an Internet Service Provider (ISP) may be aware of the transmitted
contents (referred to as internet protocol (IP) packets), the ISP is not responsible
for, nor able to control, the viewing abilities, copyrights and/or other
redistribution of the IP packets, that is, the delivered content. In short, OTT
refers to content from a third party that is delivered to an end-user, with the
ISP simply transporting content.
According to a recent study from Digital TV Research, global over-the-top (OTT) TV
revenues will more than double from $37 billion in 2016 to $83 billion in 2022,
driven in large measure by the success of subscription video-on-demand (SVOD)
services, such as Netflix and ClikiaTV. It is the success of SVOD services like
Netflix that propelled SVOD to the top of OTT revenues sources in 2013: by 2022,
SVOD is expected to generate $41.2 billion, or approximately 50%, of OTT revenues,
compared to $29.0 billion for advertising-supported video on demand (VOD), $8.1
billion for download-to-own and electronic sell-through and $5.2 billion for rental.
Recent Industry Development. Recently, a pirated streaming cable television App
known as XTV was forced to cease operations, including its availability on the Roku
streaming platform (Roku, Inc. is the operator of the leading TV streaming platform
in the United States (as measured by total hours streamed) [Source: Kantar Millward
Brown via Roku, Inc.]).
Our management views the demise of XTV as a positive sign for our properly licensed
ClikiaTV streaming cable television subscription service, in that it reflects a
growing, and proper, effort by content owners to protect their properties from
illegitimate distribution. Further, the demise of XTV has strengthened its belief
that the legitimacy of ClikiaTV's streaming cable television subscription service
is a timely entrant into the rapidly expanding OTT industry.
OTT Delivery Model. The OTT content delivery model is in contrast to the traditional
model whereby video content is delivered to an end-user through a pay television
provider, that is, a cable company. Figure A below depicts the delivery system by
which ClikiaTV (OTT) delivers video streaming content to a subscriber, without the
involvement of a cable or satellite television company.
How Users Stream ClikiaTV
with the Clikia App*
__________________________
ClikiaTV
40+ Streaming Cable TV Channels)
|
|
Clikia App
(installed on a user's device)
|
|
Streaming Entertainment for
ClikiaTV Subscribers on any Device
___________________________________________
*ClikiaTV eliminates the need for a Cable TV Subscription and eliminates
the layer of cost imposed by the Cable Company. Lower subscription rates
are available to ClikiaTV Subscribers.
Figure A
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Modes of Access. End-users access OTT content through internet-connected devices,
such as smart phones, including iPhone and Android phones, smart TVs, including
Google TV, set-top boxes, including Fire TV and Roku, gaming consoles, including
PlayStation 4,WiiU and Xbox One, and desktop/laptop computers.
ClikiaTV and the Clikia App
General. The Clikia App delivers ClikiaTV, a subscription-based cable television
streaming service that targets consumers who wish to join the cord-cutting
movement, the movement away from traditional cable television subscriptions.
Internet + Device + Clikia App = ClikiaTV Anywhere
The Clikia App, itself, is available for download for free in the iTunes Store, the
Google Play Store, on Amazon and Roku, and via Google Chromecast, for any device,
as well as through its inter-connected www.Clikia.com website.
ClikiaTV: A Streaming Cable TV Subscription Service. Currently, ClikiaTV is
comprised of over 40 channels that are commonly associated with a typical
Cable TV subscription. We believe that ClikiaTV is currently the only OTT
offering that delivers a streaming Cable TV-equivalent service that is not
interconnected with a traditional cable or satellite television subscription.
ClikiaTV includes the channels listed in Figure B below.
ESPN ESPN2 ESPN Classic TNT TBS
USA Univision Freeform Bravo CNBC
Fox News Channel CNN MSNBC HLN FX
C-Span The Weather Channel Discovery Channel National Geographic E!
Disney Nickelodeon Cartoon Network Comedy Channel Hallmark
SyFy AMC Animal Planet TLC
BET CMT MTV VH1
Spike TV HGTV Food Network OWN
ABC* CBS* NBC* FOX* PBS*
CW* ION* My9* Telemundo*
____________________________________
* Available to ClikiaTV subscribers
in the New York City area.
Figure B
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Premium Cable TV Streaming Package. Currently, we are pursuing the rights to
provide streaming service with respect to a series of channels that are commonly
offered as a premium package as an add-on to a typical Cable TV subscription,
including certain movie channels, such as HBO and Showtime. There is no
assurance that we will be successful in the efforts.
Subscribers. As of the date of this Offering Circular, the Clikia App provides
ClikiaTV streaming cable television services to a small number of subscribers.
Marketing
Our initial marketing efforts will focus on social media channels, with a gradual
inclusion of traditional marketing channels, including radio, print and television,
over time. Our primary target demographic is the population between 13 and 40 years
of age. As OTT services become more ubiquitous and better understood, we expect that
persons of nearly any age will be candidates for our ClikiaTV streaming cable
television subscription service.
Agreement with TikiLive
We have entered into a contract with TikiLive, Inc., an OTT delivery solutions company,
pursuant to which we obtained the necessary software licenses and related services for
the implementation of the Clika App's video streaming service, including for the
operation of its interconnected website, www.Clikia.com website. TikiLive, Inc.
represents a vital part of our continuing and future operations.
Competition
The market for entertainment video is intensely competitive and subject to rapid change.
ClikiaTV competes against other entertainment video providers, such as multichannel video
programming distributors (MVPDs), internet-based movie and TV content providers (including
those that provide pirated content), video gaming providers and DVD rental outlets and,
more broadly, against other sources of entertainment that ClikiaTV subscribers could choose
in their free time.
ClikiaTV also competes against entertainment video providers in obtaining content that
subscribers will enjoy. Because consumers often maintain simultaneous subscriptions with
multiple entertainment sources, we strive, and will continue to strive, to cause consumers
to choose ClikiaTV in their free time. To accomplish this objective, we will seek continually
to improve Clika TV, in both technology and content. There is no assurance that ClikiaTV will
be able to compete effectively.
Netflix, the leading video streaming content provider, and Hulu are among the most well-known
of our competitors, as is AT&T, who has aggressively pursued video streaming market share by
bundling its DirecTV(R), AT&T Fibre(R) (inexpensive broadband internet service) and cellular
services. Many of our competitors, including Netflix, Hulu and AT&T, possess substantially
greater resources, financial and otherwise, than does our company. No assurances can be given
that we will be able to compete successfully in the OTT video streaming industry.
Intellectual Property
We regard our trademarks, service marks, business know-how and proprietary recipes as having
significant value and as being an important factor in the marketing of the Clikia App. Our
policy is to establish, enforce and protect our intellectual property rights using the
intellectual property laws.
We are the owner of the following trademarks: Clikia, ClikiaTV and Sustainable TV. In the
near future, we intend to file for registration of these trademarks with the U.S. Patent
and Trademark Office.
-20-
Facilities
Our corporate and operational office of approximately 200 square-feet is leased and is located
at 7117 Florida Boulevard, Suite 203, Baton Rouge, Louisiana 70806. The monthly rent is $300,
under a one-year lease expiring in February 2018. Should additional space may be required as
we expand our operations, we expect that such space would be available within the current
building. We do not own any real property.
Employees
We currently have two part-time employees, in addition to our officers, David Loflin (CEO)
and Brian Wendt (Chief Technology Officer). Our business development, corporate administration
and business operations are overseen directly by Mr. Loflin. Mr. Loflin also oversees record
keeping and financial reporting functions. We intend to hire a small number of employees, at
such times as business conditions warrant. We have used, and, in the future, expect to use,
the services of certain outside consultants and advisors as needed, on a consulting basis.
Website
Our company's corporate website can be found at www.clikia.com. We make available free of
charge at this website all of our reports filed with OTCMarkets.com, including our annual
reports, quarterly reports and other informational reports. These reports are made available
on our website as soon as reasonably practicable after their filing with OTCMarkets.com. No
information found on our company's website is part of this Offering Circular.
MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
Cautionary Statement
The following discussion and analysis should be read in conjunction with our unaudited
financial statements and related notes, beginning on page F-1 of this Offering Circular.
Our actual results may differ materially from those anticipated in the following discussion,
as a result of a variety of risks and uncertainties, including those described under
Cautionary Statement Regarding Forward-Looking Statements and Risk Factors. We assume
no obligation to update any of the forward-looking statements included herein.
Overview
We are a development-stage company that will compete in the rapidly expanding over-the-top
(OTT) video delivery industry with our ClikiaTV streaming cable television subscription service.
Our revenues are derived from monthly subscriptions to ClikiaTV. For the foreseeable future, all
of our efforts will be focused on increasing the number of ClikiaTV subscribers on a month-to-
month basis, primarily through advertising on multiple social media platforms.
Outlook
Video Delivery (Pay-TV) Industry. Over the past two years, the cable and satellite television
industry has experienced an accelerating level of disruption caused by consumers who are
cutting the cord. Cord-cutters are consumers who have cancelled their cable or satellite
television service, in favor of video services delivered by over-the-top (see discussion below)
providers.
Over-the-Top (OTT) Content Industry. In broadcasting, over-the-top content (OTT) is the audio,
video and other media content (e.g., television programming) transmitted, or delivered, to an
end-user over the internet, without the involvement of a multiple-system operator. While an
Internet Service Provider (ISP) may be aware of the transmitted contents (referred to as
internet protocol (IP) packets), the ISP is not responsible for, nor able to control, the
viewing abilities, copyrights and/or other redistribution of the IP packets, that is, the
delivered content. In short, OTT refers to content from a third party that is delivered to
an end-user, with the ISP simply transporting content.
-21-
According to a recent study from Digital TV Research, global over-the-top (OTT) TV revenues
will more than double from $37 billion in 2016 to $83 billion in 2022, driven in large measure
by the success of subscription video-on-demand (SVOD) services, such as Netflix and ClikiaTV.
It is the success of SVOD services like Netflix that propelled SVOD to the top of OTT revenues
sources in 2013: by 2022, SVOD is expected to generate $41.2 billion, or approximately 50%, of
OTT revenues, compared to $29.0 billion for advertising-supported video on demand (VOD), $8.1
billion for download-to-own and electronic sell-through and $5.2 billion for rental.
Principal Factors Affecting Our Financial Performance
Our future operating results will be primarily affected by the following factors:
- our ability to attract and retain ClikiaTV subscribers;
- our ability to keep ClikiaTV's channel offering attractive to subscribers and potential
subscribers;
- our ability to maintain the value proposition of ClikiaTV vis-a-vis other OTT video
services; and
- our ability to contain our operating costs.
Based on our current business plan, we expect that our revenues will increase from quarter to
quarter for the foreseeable future, beginning with the quarter ending December 31, 2017. We
expect to incur operating losses through at least March 31, 2018. Further, because of our lack
of capital and the current lack of brand name awareness of ClikiaTV, we cannot predict the
levels of our future revenues.
Results of Operations
Our ClikiaTV streaming cable television subscription service has not yet generated material
revenues. The formal launch of ClikiaTV occurred on October 19, 2017.
For the Nine Months Ended December 31, 2017 (Current Interim Period) and 2016 (Prior Interim
Period). For the Current Interim Period, we incurred a net loss of $535,239 (unaudited), $172,013
(unaudited) of which was an increase in accounts payable associated with our ClikiaTV streaming
cable television subscription service. For the Prior Interim Period, we incurred a net loss of
$44,882 (unaudited).
With the launch of our ClikiaTV streaming cable television subscription service in October 2017,
we expect that our revenues for the remainder of the current year ending March 31, 2018, will
increase significantly, as compared to the Current Interim Period and the Prior Interim Period,
although we are unable to predict the amount of such increase. Likewise, as our ClikiaTV expands,
our monthly expenses can be expected to increase significantly, as compared to the Current
Interim Period and the Prior Interim Period, although we are unable to predict the amount of
such increase.
For the Years Ended March 31, 2017 (Fiscal 2017) and 2016 (Fiscal 2016). For Fiscal 2017, we
incurred a net loss of $303,595 (unaudited), $243,188 (unaudited) of which is attributable to
a one-time impairment charge of $243,188 (unaudited). This impairment charge was incurred,
inasmuch as our Board of Directors determined to abandon our Squuak.com business efforts,
including its related assets, following our acquisition of Clikia-LA. An additional $10,300
(unaudited) of our net less for Fiscal 2017 is attributable to our issuance of common stock for
services. For Fiscal 2016, we incurred a net loss of $31,562 (unaudited).
Plan of Operation
Our plan of operation focuses exclusively on acquiring subscribers of ClikiaTV's streaming cable
television subscription service. Initially, we intend to market ClikiaTV through multiple social
media platforms, including Instagram, Facebook, Twitter and LinkedIn, with a gradual inclusion of
traditional marketing channels, including radio, print and television, over time. Our primary
target demographic is the population between 13 and 40 years of age, although other demographic
groups will be targeted to a lesser extent. As OTT services become more ubiquitous and better
understood, we expect that persons of nearly any age will be potential subscribers for our
ClikiaTV streaming cable television subscription service.
Financial Condition, Liquidity and Capital Resources
At December 31 and March 31, 2017, our liabilities exceeded our assets and we lacked working
capital with which to implement our full plan of business with respect to our ClikiaTV streaming
cable television subscription service. Further, we have yet to generate significant revenues from
ClikiaTV subscriptions.
We currently lack adequate capital with which to implement our entire business plan and there is
no assurance that we ever be successful in obtaining such capital, including through this offering.
-22-
During the period ended December 31, 2017, we have entered into two separate agreements that
provided us with working capital, one directly and one indirectly:
- In July 2017, we issued a convertible promissory note in the amount of $291,000, including
original issue discount, to a third party. This promissory note is due in October 2018 and is
convertible from time to time by its holder, at then-market prices of our common stock. We also
issued to such third party a warrant to purchase approximately 14,500,000 shares of our common
stock. In consideration of its issuing such promissory note and warrant, we received cash in the
amount of $45,000 and a series of nine promissory notes, each with a face amount of $25,000 and
all of which are due in October 2018.
- In August 2017, we entered into a settlement agreement and stipulation (the Settlement Agreement)
with a third party. Pursuant to the Settlement Agreement, we agreed to issue shares of our common
stock in exchange for the settlement of certain past due obligations and accounts payable (the
Subject Debts) in the aggregate amount of $355,903.50 (the Settlement Amount), which the third
party had previously purchased from certain of our vendors. Further, we agreed to issue shares of
common stock in one or more tranches, as necessary, sufficient to satisfy the Settlement Amount.
The per share price of the shares of common stock shall be equal to 50% of the then-recent market
price of our common stock. Additionally, we issued 1,704,859 shares of our common stock to the
third party as a settlement fee. Under the Settlement Agreement, the third party is not permitted,
at any time, to own beneficially more than 9.99% of our then-outstanding shares of common stock.
We initially reserved 150 million shares of its common stock to provide for issuances made
pursuant to the Settlement Agreement. To date, a total of 27,000,000 shares have been issued in
payment of $183,889.50 of the Subject Debts.
- In November 2017, we issued a convertible promissory note in the amount of $30,000 to a third
party, in consideration for a loan in such amount. This convertible promissory note is due in
November 2018 and is convertible from time to time by its holder, at a 50% discount to the then-
market price of our common stock.
- In December 2017, we issued a convertible promissory note in the amount of $25,000 to a third
party, in consideration for a loan in such amount. This convertible promissory note is due in
December 2018 and is convertible from time to time by its holder, at a 50% discount to the then
market price of our common stock.
Contractual Obligations
To date, we have not entered into any significant long-term obligations that require us to make
monthly cash payments. Our longest-lived obligation is the lease agreement for our corporate
headquarters, which expires in February 2018. Our monthly obligation under this lease is $300.
Capital Expenditures
We made no capital expenditures during the year ended March 31, 2017, nor during the nine months
ended December 31, 2017. Our business plan does not require that we make material capital
expenditures, in order to implement successfully the plan for developing our ClikiaTV streaming
cable television subscription service.
DIRECTORS, EXECUTIVE OFFICERS, PROMOTERS AND CONTROL PERSONS
Directors and Executive Officers
The following table sets forth the names and ages of the Company's current directors and
executive officers.
Name Age Position(s)
David Loflin 60 Chief Executive Officer, Secretary and Director
Brian Wendt 29 Chief Technology Officer and Director
Our company's Board of Directors appoints our executive officers. Our directors serve until the
earlier occurrence of the election of their respective successors at the next meeting of
shareholders, death, resignation or removal by the Board of Directors. Officers serve at the
discretion of our Board of Directors. There exist no family relationships between the listed
officers and directors. Certain information regarding the backgrounds of each of our officers
and directors is set forth below.
David Loflin has served as our CEO and as a director of our company since January 2017.
Beginning in June 2016, Mr. Loflin began a sole proprietorship engaged in the development of an
OTT video streaming service doing business as Clikia, which Mr. Loflin transferred to Clikia
Corp., a Louisiana corporation (Clikia-LA), which was, in turn, acquired by our company in
February 2017. (See Certain Transactions-Acquisition of Clikia-LA). Since 1997, Mr. Loflin
has founded and served as an executive officer and director of three public companies:
USURF America, Inc. (1997-2003). USURF America operated as an internet service provider in over
10 states. USURF America provided internet access services to over 32,000 customers, 10,000 of
which were wireless access customers, and was listed on the American Stock Exchange.
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Air-Q Wi-Fi Corporation (2003-2010). From 2003 through 2005, Air-Q Wi-Fi Corporation (name
changed to Air Rover Wi-Fi Corp.) developed and marketed wi-fi hotspot internet access
services to businesses, including retail businesses, such as coffee shops and restaurants,
during the nascent period of this industry. From 2005 through 2009, after a name change to
Diamond I, Inc., the company engaged in the development and marketing of wireless hand-held
gaming systems designed for use in casinos and other establishments. From 2009 through 2010,
after a name change to ubroadcast, inc., the company operated an online live broadcasting
website, ubroadast.com. This website operated during the nascent period of the internet live
video broadcasting industry. This company is now known as Santeon Group, Inc.
Louisiana Food Company (2010-2016). Louisiana Food Company developed and marketed Louisiana-
entric specialty food products, including Voodoo Coffee, Jammin' Jambalaya, Red Stick Red
Beans, Acadiana Dirty Rice, Bon Temps Lou'siana Fry, Breaux Bridge Etouffee, Fais do-do Gumbo,
Pirogue Rice and Elysian Fields Black-eyed Peas. Louisiana Food Company ceased its operations,
due to a lack of working capital.
Since February 2016, Mr. Loflin has been a principal in LiveSpeed Broadband, a Baton Rouge,
Louisiana-based wireless internet service provider that has moved its base of operations to
Colorado. In addition to the foregoing, Mr. Loflin has, for more than the past five years,
been engaged as a consultant to public companies and their executive officers.
Brian Wendt has served as a director of our company since October 2015, as our CEO from
October 2015 to January 2017 and as our Chief Technology Officer since January 2017. For all
of his working life, Mr. Wendt has engaged as a software developer and social media expert,
in the technology, web development and internet community in Phoenix, Arizona.
Conflicts of Interest
At the present time, we do not foresee any direct conflict between our officers, their other
business interests and their involvement in our company.
Corporate Governance
We do not have a separate Compensation Committee, Audit Committee or Nominating Committee.
These functions are conducted by our Board of Directors acting as a whole.
During the year ended March 31, 2017, out Board of Directors did not hold a meeting, but
took action by unanimous written consent in lieu of a meeting on eight occasions.
Independence of Board of Directors
Neither of our directors is independent, within the meaning of definitions established by
the SEC or any self-regulatory organization. We are not currently subject to any law, rule
or regulation requiring that all or any portion of our Board of Directors include independent
directors.
Shareholder Communications with Our Board of Directors
Our company welcomes comments and questions from our shareholders. Shareholders should direct
all communications to our CEO, David Loflin, at our executive offices. However, while we
appreciate all comments from shareholders, we may not be able to respond individually to all
communications. We attempt to address shareholder questions and concerns in our press releases
and documents filed with OTC Markets, so that all shareholders have access to information about
us at the same time. Mr. Loflin collects and evaluates all shareholder communications. All
communications addressed to our directors and executive officers will be reviewed by those
parties, unless the communication is clearly frivolous.
Code of Ethics
As of the date of this Offering Circular, our Board of Directors has not adopted a code of
ethics with respect to our directors, officers and employees.
EXECUTIVE COMPENSATION
Currently, our management is unable to estimate accurately when, if ever, our company will
generate sufficient revenues for the payment of salaries to our management.
-24-
As of the date of this Offering Circular, there are no annuity, pension or retirement
benefits proposed to be paid to officers, directors or employees of our company, pursuant
to any presently existing plan provided by or contributed to by our company.
Employment Agreement
In January 2017, we entered into an employment agreement with our CEO, David Loflin. Mr.
Loflin's employment agreement has an initial term of three years. Mr. Loflin's annual
salary is $180,000. Through June 30, 2017, Mr. Loflin was paid no salary and none was
accrued. Beginning January 1, 2018, any unpaid salary amounts will be accrued and will
be paid at such time as we possess adequate capital to do so, in the discretion of our
Board of Directors.
Outstanding Equity Awards
During the fiscal years ended March 31, 2017 and 2016, our Board of Directors made no
equity awards and no such award is pending.
Long-Term Incentive Plans
We currently have no long-term incentive plans.
Director Compensation
Our directors receive no compensation for their serving as directors.
SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
Common Stock
The following table sets forth, as of the date of this Offering Circular, information
regarding beneficial ownership of the Company's common stock by the following: (a) each
person, or group of affiliated persons, known by our company to be the beneficial owner
of more than five percent of any class of our voting securities; (b) each of our directors;
(c) each of the named executive officers; and (d) all directors and executive officers as
a group. Beneficial ownership is determined in accordance with the rules of the SEC, based
on voting or investment power with respect to the securities. In computing the number of
shares beneficially owned by a person and the percentage ownership of that person, shares
of common stock underlying warrants, if any, held by that person are deemed to be
outstanding if the warrants are exercisable within 60 days of the date hereof.
Before This Offering After This Offering
_________________________ __________________________
Name of Shareholder Shares Owned Percentage Shares Owned Percentage
Owned(1) Owned (2)
________________________________________________________________________________
Common Stock
________________________________________________________________________________
Executive Officers and Directors
________________________________________________________________________________
David Loflin 106,754,675(3) 17.00% 106,754,675(3) 6.21%
Brian Wendt 13,500,000 2.15% 13,500,000 *
Officers and directors, as 120,254,675(3) 19.15% 120,254,675(3) 6.99%
a group (2 persons)
________________________________________________________________________________
5% Owners
________________________________________________________________________________
RioRoca Holdings, LLC(4) 31,754,675 4.60% 31,754,675 1.85%
Colins Capital, LLC(5) 62,781,467(6) 9.10% 156,281,467(7) 9.10%
________________________________________________________________________________
Series A Super Voting Preferred Stock
________________________________________________________________________________
RioRoca Holdings, LLC 2,000,000(7) 100% 2,000,000(8) 100%
________________________________________________________________________________
-25-
(1) Based on 690,596,139 shares outstanding, including 62,781,467 unissued shares that underlie
the currently convertible portions of convertible debt instruments, before this offering.
(2) Based on 1,719,096,139 shares outstanding, including 156,281,467 unissued shares that
underlie the currently convertible portions of convertible debt instruments, after this
offering and assuming all of the Offered Shares are sold.
(3) 31,754,675 of these shares are owned of record by RioRoca Holdings, LLC.
(4) This entity is owned by David Loflin, the Company's CEO and a Director.
(5) This entity is owned by James Kaufman.
(6) These shares have not been issued, but underlie the currently convertible portion of a
convertible debt instrument.
(7) The shares of Series A Super Voting Preferred Stock have 500 times that number of votes
on all matters submitted to the shareholders that each shareholder of Company common stock is
entitled to vote at each meeting of shareholders. The shares of Series A Super Voting Preferred
Stock vote together with the holders of Company common stock as a single class. The Company's
CEO, David Loflin, through his ownership of RioRoca Holdings, LLC, controls all Company
corporate matters.
Series A Super Voting Preferred Stock
Currently, there are 2,000,000 shares of our Series A Super Voting Preferred Stock issued and
outstanding, all of which are owned by RioRoca Holdings, LLC. Our CEO, David Loflin, is the owner
of RioRoca Holdings, LLC and, through his ownership thereof, controls all corporate matters of
our company.
Holders of the Series A Super Voting Preferred Stock have 500 times that number of votes on all
matters submitted to the shareholders that each shareholder of our common stock is entitled to
vote at each meeting of shareholders with respect to all matters presented to the shareholders
for their action or consideration. Holders of the Series A Super Voting Preferred Stock shall
vote together with the holders of our common stock as a single class. (See Description of
Securities-Series A Super Voting Preferred Stock).
CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
Bonus Shares Issued to Director
In October 2015, one of our directors, Brian Wendt, was issued 3,5000,00 shares of our common
stock as a bonus, which shares were valued at $3,500. In January 2017, Mr. Wendt, was issued
10,0000,00 shares of our common stock as a bonus, which shares were valued at $10,000.
Change in Control Transaction
In August 2016, David Loflin, now our CEO and a director, acquired control of our
company, by his acquiring control of RioRoca Holdings, LLC. RioRoca Holdings owns (a) 31,754,675
shares of our common stock and (b) 2,000,000 shares of our Series A Super Voting Preferred Stock.
Through RioRoca Holdings' ownership of the Series A Super Voting Preferred Stock, Mr. Loflin
controls all aspects of the management of our company.
Employment Agreement
In January 2017, we entered into an employment agreement with our CEO, David Loflin. Mr.
Loflin's employment agreement has an initial term of three years. Mr. Loflin's annual salary is
$180,000. Through June 30, 2017, Mr. Loflin was paid no salary and none was accrued. Beginning
January 1, 2018, any unpaid salary amounts will be accrued and will be paid at such time as we
possess adequate capital to do so, in the discretion of our Board of Directors.
-26-
Acquisition of Clikia-LA
In February 2017, the Company acquired Clikia Corp., a Louisiana corporation. Pursuant to the
acquisition transaction, our CEO and a director, David Loflin, received 75,000,000 shares and
TikiLive, Inc. received 50,000,000 shares of the 125,000,000 shares of Company Common Stock
ssued in the acquisition transaction. Subsequent to the closing of this transaction, we entered
into a common stock repurchase agreement with TikiLive, Inc., pursuant to which we repurchased
25,000,000 of the shares issued to TikiLive, Inc., in exchange for a $150,000 face amount
promissory note payable by us on demand.
Acquisition of LiveSpeed Broadband
In November 2017, we acquired, in separate transactions, 45% of each of LiveSpeed Baton Rouge #1,
LLC (d/b/a LiveSpeed Broadband) (LSB#1) and LiveSpeed Baton Rouge #2, LLC (d/b/a LiveSpeed
Broadband) (LSB#2). In each of the acquisition transactions, we issued two promissory notes
with $60,000 face amounts and a total of 5,000,000 shares of our common stock to a third party.
(See Use of Proceeds). Further, in connection with each such acquisition transaction, the
remaining 55% ownership interest was contributed to the capital of our company for no
consideration by a company in which our CEO, David Loflin, holds a 50% pecuniary interest. Mr.
Loflin received no consideration, direct or indirect, in connection with such contributions.
LEGAL MATTERS
Certain legal matters with respect to the Offered Shares offered by this Offering Circular will
be passed upon by Newlan & Newlan, Ltd., Flower Mound, Texas.
WHERE YOU CAN FIND MORE INFORMATION
We have filed an offering statement on Form 1-A with the SEC under the Securities Act with
respect to the common stock offered by this Offering Circular. This
Offering Circular, which constitutes a part of the offering statement, does not contain all of the
information set forth in the offering statement or the exhibits and schedules filed therewith.
For further information with respect to us and our common stock, please see the offering statement
and the exhibits and schedules filed with the offering statement. Statements contained in this
Offering Circular regarding the contents of any contract or any other document that is filed as an
exhibit to the offering statement are not necessarily complete, and each such statement is
qualified in all respects by reference to the full text of such contract or other document filed as
an exhibit to the offering statement. The offering statement, including its exhibits and schedules,
may be inspected without charge at the public reference room maintained by the SEC, located at 100
F Street, N.E., Room 1580, Washington, D.C. 20549, and copies of all or any part of the offering
statement may be obtained from such offices upon the payment of the fees prescribed by the SEC.
Please call the SEC at 1-800-SEC-0330 for further information about the public reference room. The
SEC also maintains an Internet website that contains all information regarding companies that file
electronically with the SEC. The address of the site is www.sec.gov.
INDEX TO FINANCIAL STATEMENTS
Unaudited Consolidated Financial Statements for the Nine Months Ended December 31, 2017 and 2016
_____________________________________________________________________________________________
Page
Consolidated Balance Sheets at December 31, 2017, and March 31, 2017 F-1
Consolidated Statements of Operations For the Three and Nine Months Ended
December 31, 2017 and 2016 F-2
Consolidated Statements of Cash Flows For the Nine Months Ended December 31, 2017 and 2016 F-3
Notes to Consolidated Financial Statements F-4
Unaudited Consolidated Financial Statements for the Years Ended March 31, 2017 and 2016
_____________________________________________________________________________________________
Consolidated Balance Sheets at March 31, 2017 and 2016 F-7
Consolidated Statements of Operations For the Years Ended March 31, 2017 and 2016 F-8
Consolidated Statements of Changes in Stockholders' Equity (Deficit) For the Years
Ended March 31, 2017 and 2016 F-9
Consolidated Statements of Cash Flows For the Years Ended March 31, 2017 and 2016 F-10
Notes to Consolidated Financial Statements F-11
-27-
CLIKIA CORP.
CONSOLIDATED BALANCE SHEETS
December 31, 2017, and March 31, 2017
(unaudited)
December 31, 2017 March 31, 2017
_____________ ______________
ASSETS
Current assets
Cash and cash equivalents $ 4,530 $ 11,197
Prepaid expenses and other current assets 622 622
__________ ___________
Total current assets 5,152 11,819
__________ ___________
Other assets
Notes receivable - third party 225,000 ---
Investment in LiveSpeed Broadband 141,000 ---
Investment in Clikia Corp. (Louisiana) subsidiary 13,976 13,976
__________ ___________
Total intangible assets 379,976 13,976
__________ __________
Fixed assets
Equipment 1,284 1,284
__________ ___________
Total fixed assets 1,284 1,284
__________ ___________
Total assets $ 386,412 $ 27,079
__________ ___________
__________ ___________
LIABILITIES AND STOCKHOLDERS' (DEFICIT)
Current liabilities
Accounts payable - trade $ 172,013 $ ---
Loan on open account - third party 30,000 30,000
Loan on open account - related party 2,664 ---
Notes payable - third parties 491,000 ---
Note payable (Schooner Equities) 25,000 25,000
Note payable (Goodkin) 10,000 10,000
Note payable (Murphy) 36,370 48,870
Notes payable (Par Point) 243,250 243,250
__________ ___________
Total current liabilities 1,010,297 357,120
Stockholders' deficit
Preferred stock, $.00001 par value; 5,000,000 20 20
shares authorized, 2,000,000 and 2,000,000 shares
issued and outstanding at December 31, 2017, and
March 31, 2017, respectively
Common stock, $.00001 par value; 3,450,000,000 shares 3,358 2,548
authorized, 335,814,672 and 254,814,672 shares
issued and outstanding at December 31, 2017, and
March 31, 2017, respectively
Additional paid-in capital 273,322 32,737
Accumulated deficit (900,585) (365,346)
__________ ___________
Total stockholders' deficit $(623,885) $ (330,041)
__________ ___________
Total liabilities and stockholders' deficit $ 386,412 $ 27,079
__________ ___________
__________ ___________
The accompanying notes are an integral part of these unaudited financial statements.
-F-1-
CLIKIA CORP.
CONSOLIDATED STATEMENTS OF OPERATIONS
For the Three and Nine Months Ended December 31, 2017 and 2016
(unaudited)
Three Months Ended Nine Months Ended
______________________________ ______________________________
12/31/17 12/31/16 12/31/17 12/31/16
_____________ ______________ _____________ ______________
Revenues $ 455 $ --- $ 1,049 $ ---
Operating expenses 93,967 12,956 536,288 44,882
_____________ ______________ _____________ ______________
Operating loss (93,512) (12,956) (535,239) (44,882)
_____________ ______________ _____________ ______________
Net loss $ (93,512) $ (12,956) $ (535,239) $ (44,882)
_____________ ______________ _____________ ______________
_____________ ______________ _____________ ______________
Net loss per common share
Basic and diluted $ (0.00) $ (0.00) $ (0.00) $ (0.00)
_____________ ______________ _____________ ______________
_____________ ______________ _____________ ______________
Weighted average number of
common shares outstanding:
Basic and diluted 317,259,116 242,814,672 303,566,610 242,814,672
_____________ _____________ ____________ _____________
_____________ _____________ ____________ _____________
The accompanying notes are an integral part of these unaudited financial statements.
-F-2-
CLIKIA CORP.
CONSOLIDATED STATEMENTS OF CASH FLOWS
For the Nine Months Ended December 31, 2017 and 2016
(unaudited)
Nine Months Ended
_____________________________
12/31/17 12/31/16
_____________ _____________
CASH FLOWS FROM OPERATING ACTIVITIES:
Net loss $ (535,239) $ (44,882)
Adjustments:
Stock issued for services 10,000 ---
Stock issued for payment of accounts payable 183,890 ---
Note issued for services 25,000 ---
Original issue discount 21,000 ---
Increase in accounts payable 169,403 ---
_____________ _____________
Net cash used in operating activities (123,336) (44,882)
CASH FLOWS FROM INVESTING ACTIVITIES:
Net cash provided by (used in) investing activities --- ---
CASH FLOWS FROM FINANCING ACTIVITIES:
Stock issued for cash 14,000 ---
Notes payable - third party, net of original issue discount 270,000 ---
Notes payable - third parties, net of finder's fees 49,500 ---
Notes receivable - third party (225,000) ---
Advance on open account - related party 2,669 ---
_____________ _____________
Net cash provided by (used in) financing activities 116,550 ---
_____________ _____________
Net increase (decrease) in cash (6,667) (2,330)
Cash, beginning of year 11,197 2,936
_____________ _____________
Cash, end of year $ 4,530 $ 606
_____________ _____________
_____________ _____________
The accompanying notes are an integral part of these unaudited financial statements.
-F-3-
CLIKIA CORP.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
December 31, 2017
(unaudited)
NOTE 1. NATURE OF THE BUSINESS
Clikia Corp. (the Company) was incorporated in 2002 in the State of Nevada, under the name MK
Automotive, Inc. The Company's corporate name changed to Clikia Corp. in July 2017. From 2002
through 2015, the Company was engaged in the retail and commercial automotive diagnostic,
maintenance and repair services businesses, and, from December 2015 through January 2017, our
company pursued the commercial exploitation of Squuak.com, a social media and content sharing
tool and platform. Ultimately, these business efforts were unsuccessful. In February 2017, the
Company acquired Clikia Corp., a Louisiana corporation (Clikia-LA), a Baton Rouge, Louisiana-
based over-the-top, or OTT, video streaming service provider, and adopted the OTT video
streaming business plan of Clikia-LA.
Clikia TV is the Company's subscription-based streaming cable television service delivered via
its Clikia App, which is available in the iTunes Store, the Google Play Store, on Amazon and
Roku, and via Google Chromecast for any device, and through the Company's interconnected
website, www.Clikia.com, that targets consumers who wish to join the cord-cutting movement,
the movement away from traditional cable television subscriptions.
Clikia TV competes in the over-the-top content (video) delivery industry. Over-the-top, or OTT,
is the term used to describe the delivery of film and TV content via the internet, without
requiring users to subscribe to a traditional cable or satellite pay-TV service, like Comcast,
Time Warner Cable or DirecTV.
NOTE 2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Basis of Presentation
The accompanying consolidated financial statements have been prepared in conformity with
accounting principles generally accepted in the United States of America.
Principles of Consolidation
The consolidated financial statements include the accounts of the Company and its wholly-owned
subsidiary, Clikia-LA. All inter-company accounts and transactions have been eliminated in
consolidation.
Cash and Cash Equivalents
Cash and cash equivalents include cash on hand and cash in time deposits, certificates of
deposit and all highly liquid investments with original maturities of three months or less.
Stock Issued for Services
The Company accounts for equity instruments issued in exchange for the receipt of goods or
services from persons other than employees in accordance with ASC Topic 505. Costs are
measured at the estimated fair market value of the consideration received or the estimated
fair value of the equity instruments issued, whichever is more reliably measurable. The
value of equity instruments issued for consideration other than employee services is
determined on the earliest of performance commitment or completion of performance by the
provider of goods or services as defined by ASC Topic 505.
Earnings per Share
Basic net income (loss) per share is computed on the basis of the weighted average number
of common shares outstanding during the period.
NOTE 3. ACCOUNTING POLICIES
The Company has evaluated recent accounting pronouncements and believes none will have a
material effect on its consolidated financial statements upon implementation.
-F-4-
NOTE 4. CHANGE IN CONTROL OF THE COMPANY
In September 2016, there occurred a change in control of the Company, when the Company's
now-CEO, David Loflin, acquired ownership of RioRoca Holdings, LLC, the owner of (a)
31,754,675 shares, or approximately 60%, of the Company's then-outstanding common stock
and (b) 2,000,000 shares of the Company's Series A Super Voting Preferred Stock (shares
of Series A Super Voting Preferred Stock have 500 times that number of votes on all
matters submitted to the shareholders that each shareholder of Company common stock is
entitled to vote at each meeting of shareholders and vote together with the holders of
Company common stock as a single class). This ownership of Company securities provides
RioRoca Holdings, LLC with control of the Company. As the owner of RioRoca Holdings, LLC,
Mr. Loflin controls the disposition and voting of Company securities owned by RioRoca
Holdings, LLC.
NOTE 5. EXTINGUISHMENT OF DEBT
In December 2011, the Company entered into a settlement agreement (the Settlement
Agreement) with one of its lenders to satisfy an existing loan default, which resulted
in the extinguishment of such loan. The principal balance of the loan, at the time of
the Settlement Agreement, was $460,410, with related accrued interest of $4,676.
In connection with the Settlement Agreement, two related parties (Michael R. Murphy
and Thomas E. Kubik) loaned a total of $225,704 in cash to the Company. The
proceeds of both of these loans were applied by the Company to satisfy its payment
obligation of $225,704 under the Settlement Agreement. (See Note 6. Related-Party
Transactions).
NOTE 6. RELATED-PARTY TRANSACTIONS
In November 2017, the Company acquired, in separate transactions, 45% of each of
LiveSpeed Baton Rouge #1, LLC (d/b/a LiveSpeed Broadband) and LiveSpeed Baton Rouge
#2, LLC (d/b/a LiveSpeed Broadband). In the acquisition transactions, the Company
issued two promissory notes with $60,000 face amounts and a total of 5,000,000
shares of our common stock to a third party. Further, in connection with each such
acquisition transaction, the remaining 55% ownership interest was contributed to
the capital of the Company for no consideration by a company in which the Company's
CEO, David Loflin, holds a 50% pecuniary interest. Mr. Loflin received no
consideration, direct or indirect, in connection with such contributions.
In February 2017, the Company acquired Clikia Corp., a Louisiana corporation (Clikia-
LA). Pursuant to the acquisition transaction, the Company's CEO, David Loflin, received
75,000,000 shares of the 125,000,000 shares of Company common stock issued in the
acquisition transaction. (See Note 9. Acquisitions).
In December 2011, the Company borrowed a total of $225,704 from two shareholders
($112,852 from each of Michael R. Murphy and Thomas E. Kubik). The proceeds of both
loans were applied by the Company to satisfy its payment obligation of $225,704 under
the Settlement Agreement.In connection with Mr. Murphy's loan, the Company issued a
promissory note, face amount $112,852, to Mr. Murphy, in consideration of his
$112,852 loan to the Company. This promissory note, by its original terms,
bears no interest, had a due date of December 31, 2012, and was convertible into
shares of Company common stock at the rate of one share for every $.00001 of debt
converted. However, by agreement with the holder of such promissory note, in April
2017, the conversion rate under such promissory note was amended to one share for
every $.0005 of debt converted. At June 30, 2017, and March 31, 2017, the remaining
unpaid principal balance of such promissory note was $36,370 and $48,870,
respectively. (See Note 5. Extinguishment of Debt and Note 7. Notes Payable). In
December 2011, the Company borrowed a total of $225,704 from two shareholders
($112,852 from each of Michael R. Murphy and Thomas E. Kubik). The proceeds of both
loans were applied by the Company to satisfy its payment obligation of $225,704
under the Settlement Agreement. In connection with Mr. Murphy's loan, the Company
issued a promissory note, face amount $112,852, to Mr. Murphy, in consideration of
his $112,852 loan to the Company. This promissory note, by its original terms,
bears no interest, had a due date of December 31, 2012, and was convertible into
shares of Company common stock at the rate of one share for every $.00001 of debt
converted. However, by agreement with the holder of such promissory note, in April
2017, the conversion rate under such promissory note was amended to one share for
every $.0005 of debt converted. At June 30, 2017, and March 31, 2017, the remaining
unpaid principal balance of such promissory note was $36,370 and $48,870,
respectively. (See Note 5. Extinguishment of Debt and Note 7. Notes Payable).
NOTE 7. NOTES PAYABLE
In February 2017, the Company issued a promissory note, face amount $25,000, to
Schooner Equities, LLC, in consideration of a loan in the amount of $25,000. This
promissory note bears interest at 6% per annum, is due in February 2018 and is
convertible into shares of Company common stock at a conversion price that is equal
to 45% of the then-current market price of the Company's common stock. At June 30,
2017, and March 31, 2017, the remaining unpaid principal balance of such promissory
note was $25,000.
In July 2017, the Company issued convertible promissory note in the amount of
$291,000, including original issue discount, to a third party. This promissory note
is due in October 2018 and is convertible from time to time by its holder, at then-
market prices of the Company's common stock. The Company also issued to such third
party a warrant to purchase approximately 14,500,000 shares of its common stock. In
consideration of its issuing such promissory note and warrant, the Company
received cash in the amount of $45,000 and a series of nine promissory notes in the
amount of $25,000, all of which are due in October 2018.
In March 2017, the Company issued a promissory note, face amount $10,000, to a third
party, Adam Goodkin, in consideration of a loan in the amount of $10,000. This
promissory note bears interest at 6% per annum, is due in March 2018 and is
convertible into shares of Company common stock at the rate of one share for every
$.00166 of debt converted. At June 30, 2017, and March 31, 2017, the remaining unpaid
principal balance of such promissory note was $10,000.
In November 2017, the Company issued two promissory notes with $60,000 face amounts
a third party, in connection with the Company acquisitions of LiveSpeed Baton Rouge
#1, LLC and LiveSpeed Baton Rouge #2, LLC. These promissory notes bear interest at
5% per annum and are due in January 2018.
In November 2017, the Company issued a promissory note, face amount $30,000, to a
third party, in consideration of a loan in the amount of $30,000. This promissory
note bears interest at 10% per annum, is due in November 2018 and is convertible
into shares of Company common stock at a rate that is a discount to the then-market
price of the Company's common stock. At December 31, 2017, the remaining unpaid
principal balance of such promissory note was $30,000.
In November 2017, the Company issued a promissory note, face amount $25,000, to a third
party, in consideration of consulting services. This promissory note bears interest at
10% per annum, is due in November 2018 and is convertible into shares of Company common
stock at a rate that is a discount to the then-market price of the Company's common
stock. At December 31, 2017, the remaining unpaid principal balance of such promissory
note was $25,000.
In December 2017, the Company issued a promissory note, face amount $25,000, to a
third party, in consideration of a loan in the amount of $25,000. This promissory
note bears interest at 10% per annum, is due in December 2018 and is convertible
into shares of Company common stock at a rate that is a discount to the then-market
price of the Company's common stock. At December 31, 2017, the remaining unpaid
principal balance of such promissory note was $25,000.
In August 2015, the Company issued a promissory note, face amount $225,000, to Par
Point Capital, LLC, in connection with the Company's purchase of Squuak.com and
related intangible assets. This promissory note bears interest at 6% per annum, was due
in August 2016 and is convertible into shares of Company common stock at the rate of
one share for every $.0005 of debt converted. At June 30, 2017, and March 31, 2017,
the remaining unpaid principal balance of such promissory note was $225,000.
-F-5-
In August 2015, the Company issued a promissory note, face amount $25,000, to Par Point
Capital, LLC, pursuant to a consulting agreement. This promissory note bears interest
at 6% per annum, was due in August 2016 and is convertible into shares of Company common
stock at the rate of one share for every $.0005 of debt converted. At June 30, 2017,
and March 31, 2017, the remaining unpaid principal balance of such promissory note was
$18,250.
In December 2011, the Company issued a promissory note, face amount $112,852, to
Michael R. Murphy, in consideration of his $112,852 loan to the Company. This
promissory note, by its original terms, bears no interest, had a due date of December
31, 2012, and was convertible into shares of Company common stock at the rate of
one share for every $.00001 of debt converted. However, by agreement with the holder
of such promissory note, in April 2017, the conversion rate under such promissory
note was amended to one share for every $.0005 of debt converted. During the three
months ended June 30, 2017, a total of 25,000,000 shares of common stock were
issued in connection with partial conversions of this promissory note, with a total
of $12,500.00 of principal balance of this promissory note being extinguished.
At June 30, 2017, and March 31, 2017, the remaining unpaid principal balance of such
promissory note was $36,370 and $49,480, respectively.
NOTE 8. LOAN ON OPEN ACCOUNT
In February 2017, the Company obtained a loan on open account from a third party in
the amount of $30,000. This loan on open account is payable on demand.
NOTE 9. ACQUISITIONS
In November 2017, the Company acquired, in separate transactions, 45% of each of
LiveSpeed Baton Rouge #1, LLC (d/b/a LiveSpeed Broadband) and LiveSpeed Baton Rouge
#2, LLC (d/b/a LiveSpeed Broadband). In the acquisition transactions, the Company
issued two promissory notes with $60,000 face amounts and a total of 5,000,000
shares of our common stock to a third party. Further, in connection with each such
acquisition transaction, the remaining 55% ownership interest was contributed to
the capital of the Company for no consideration by a company in which the Company's
CEO, David Loflin, holds a 50% pecuniary interest. Mr. Loflin received no
consideration, direct or indirect, in connection with such contributions. (See
Note 6. Related-Party Transactions and Note 7. Notes Payable).
In February 2017, the Company acquired Clikia Corp. (Clikia-LA), a Baton Rouge,
Louisiana-based OTT video streaming service provider, and adopted the OTT video
streaming business plan of Clikia-LA and is currently pursuing such business plan.
In connection with such transaction, the Company issued a total of 125,000,000 shares
of common stock to the owners of Clikia-LA, including to the Company's CEO and a
director, David Loflin, who was issued 75,000,000 shares, and TikiLive, Inc., who
was issued 50,000,000 shares. Subsequent to the closing of this transaction and
subsequent to December 31, 2017, the Company entered into a common stock repurchase
agreement with TikiLive, Inc., pursuant to which the Company repurchased 25,000,000
of the shares issued to TikiLive, Inc., in exchange for a $150,000 face amount
promissory note, which was, thereafter, forgiven in full by TikiLive, Inc. (See
Note 6. Related-Party Transactions and Note 13. Subsequent Events).
In December 2015, the Company acquired Squuak.com, a social media and content
sharing tool and platform, from Par Point Capital, LLC, in exchange for a $225,000
promissory note. (See Note 7. Notes Payable).
NOTE 10. CAPITAL STOCK
Amendment of Articles of Incorporation
In November 2017, the Company amended its Articles of Incorporation, to expand its
authorized number of shares of common stock to 1,450,000,000 shares. In March 2018,
the Company amended its Articles of Incorporation, to expand its authorized number
of shares of common stock to 3,450,000,000 shares.
Stock Issued for Services
During the three months ended June 30, 2017, the Company issued 6,000,000 shares of
common stock pursuant to the terms of a financial consulting agreement with a third
party, which shares were valued at $10,000, in the aggregate.
Stock Issued for Cash
In December 2017, the Company issued 17,500,000 shares of common stock, pursuant to
the Company's offering pursuant to Regulation A under the Securities Act of 1933,
as amended. These shares were sold for cash at $.0003 per share, or $14,000, in the
aggregate.
NOTE 11. SETTLEMENT AGREEMENT
In August 2017, the Company entered into a settlement agreement and stipulation (the
Settlement Agreement) with a third party. Pursuant to the Settlement Agreement, the
Company agreed to issue shares of its common stock in exchange for the settlement of
certain past due obligations and accounts payable of the Company (the Subject Debts)
in the aggregate amount of $355,903.50 (the Settlement Amount), which the third party
had previously purchased from certain vendors of the Company. Further, the Company
agreed to issue shares of common stock in one or more tranches, as necessary,
sufficient to satisfy the Settlement Amount. The per share price of the shares of
common stock shall be equal to 50% of the then-recent market price of the Company's
common stock. Additionally, the Company issued 1,704,859 shares of its common stock
to the third party as a settlement fee. Under the Settlement Agreement, the third
party is not permitted, at any time, to own beneficially more than 9.99% of the
Company's then-outstanding shares of common stock. The Company initially reserved
150 million shares of its common stock to provide for issuances made pursuant to
the Settlement Agreement. To date, a total of 27,000,000 shares have been issued
in payment of $183,889.50 of the Subject Debts.
NOTE 12. REGULATION A OFFERING
In December 2017, the Company's Form 1-A filed with the SEC, relating to an
offering pursuant to Regulation A under the Securities Act of 1933, as amended, was
qualified by the SEC. The Company is offering up to 1,000,000,000 shares of its
common stock at an offering price of $.0008 per share. As of December 31, 2017,
the Company had sold 17,500,000 shares of its common stock pursuant to such offering.
NOTE 13. SUBSEQUENT EVENT
In January 2018, the Company consummated a common stock repurchase agreement with
TikiLive, Inc., pursuant to which the Company repurchased 25,000,000 of the shares
issued to TikiLive, Inc. in connection with the Company's acquisition of Clikia-LA,
in exchange for a $150,000 face amount promissory note. Then, in February 2018,
due to certain business conditions affecting TikiLive, Inc., the entire balance of
such promissory note was forgiven in full by TikiLive, Inc., for no additional
consideration. (See Note 6. Related-Party Transactions).
-F-6-
CLIKIA CORP.
CONSOLIDATED BALANCE SHEETS
March 31, 2017 and 2016
(unaudited)
March 31, 2017 March 31, 2016
______________ _______________
ASSETS
Current assets
Cash and cash equivalents $ 11,197 $ 924
Prepaid expenses and other current assets 622 622
_____________ ______________
Total current assets 11,819 1,546
_____________ ______________
Other assets
Investment in Clikia Corp. (Louisiana)
subsidiary 13,976 ---
Other intangible assets, net of amortization --- 243,188
_____________ ______________
Total intangible assets 13,976 243,188
_____________ ______________
Fixed assets
Equipment 1,284 1,284
_____________ ______________
Total fixed assets 1,284 1,284
_____________ ______________
Total assets $ 27,079 $ 246,018
_____________ ______________
_____________ ______________
LIABILITIES AND STOCKHOLDERS' (DEFICIT)
Current liabilities
Accounts payable - trade $ --- $ 1,264
Loan on open account - third party 30,000 ---
Note payable (Schooner Equities) 25,000 ---
Note payable (Goodkin) 10,000 ---
Note payable (Murphy) 48,870 49,480
Notes payable (Par Point) 243,250 250,000
_____________ ______________
Total current liabilities 357,120 300,744
Stockholders' deficit
Preferred stock, $.00001 par value; 20 20
5,000,000 shares authorized, 2,000,000
and 2,0000,000 shares issued and
outstanding at March 31, 2017 and 2016,
respectively
Common stock, $.00001 par value; 2,548 615
950,000,000 shares authorized,
254,814,672 and 61,514,672 shares issued
and outstanding at March 31, 2017 and
2016, respectively
Additional paid-in capital 32,737 6,390
Accumulated deficit (365,346) (61,751)
_____________ ______________
Total stockholders' deficit $ (330,041) $ (54,726)
_____________ ______________
Total liabilities and stockholders' deficit $ 27,079 $ 246,018
_____________ ______________
_____________ ______________
The accompanying notes are an integral part of these unaudited financial statements.
-F-7-
CLIKIA CORP.
CONSOLIDATED STATEMENTS OF OPERATIONS
For the Years Ended March 31, 2017 and 2016
(unaudited)
Year Ended
_________________________________
March 31, 2017 March 31, 2016
______________ ______________
Revenues $ 200 $ ---
Operating costs and expenses
Operating expenses 60,407 31,562
Impairment charge 243,188 ---
______________ ______________
Total operating expenses 303,595 31,562
______________ ______________
Operating loss (303,595) (31,562)
______________ ______________
Net loss $ (303,595) $ (31,562)
______________ ______________
______________ ______________
Net loss per common share
Basic and diluted $ (0.00) $ (0.00)
______________ ______________
______________ ______________
Weighted average number of
common shares outstanding:
Basic and diluted 77,897,339 52,514,672
______________ ______________
______________ ______________
The accompanying notes are an integral part of these unaudited financial statements.
-F-8-
CLIKIA CORP.
CONSOLIDATED STATEMENTS OF STOCKHOLDERS' DEFICIT
For the Years Ended June 30, 2017 and 2016
(unaudited)
Preferred Stock Common Stock
_________________ ___________________
Total
Additional Accu- Stock-
Shares Amount Shares Amount Paid-in mulated holders'
Capital Deficit Deficit
__________________________________________________________________________________________
Balance,
March
31, 2015 2,000,000 $ 20 38,514,672 $ 385 $ --- $(30,189) $(30,324)
Shares
issued
for bonus --- --- 3,500,000 35 3,465 --- 3,500
Shares
issued
for
consulting --- --- 3,500,000 35 3,465 --- 3,500
Shares
issued
for debt
conver-
sions --- --- 16,000,000 160 --- --- 160
Net loss --- --- --- --- --- (31,562) (31,562)
___________________________________________________________________________________________
Balance,
March
31, 2016 2,000,000 20 61,514,672 615 6,390 (61,751) (54,726)
Shares
issued
for
consulting --- --- 300,000 3 297 --- 300
Shares
issued
for
business
acquisition --- --- 125,000,000 1,250 11,250 --- 12,500
Shares
issued
for
bonus --- --- 10,000,000 100 9,900 --- 10,000
Shares
issued for
debt
conver-
sions --- --- 58,000,000 580 4,900 --- 5,480
Net loss --- --- --- --- --- (303,595) (303,595)
__________________________________________________________________________________________
Balance,
March
31, 2017 2,000,000 20 254,814,672 2,548 32,737 (365,346) (330,041)
__________________________________________________________________________________________
__________________________________________________________________________________________
The accompanying notes are an integral part of these unaudited financial statements.
-F-9-
CLIKIA CORP.
CONSOLIDATED STATEMENTS OF CASH FLOWS
For the Year Ended March 31, 2017 and 2016
(unaudited)
Year Ended
_______________________________
March 31, 2017 March 31, 2016
______________ ______________
CASH FLOWS FROM OPERATING ACTIVITIES:
Net loss $ (303,041) $ (31,562)
Adjustments to reconcile net
loss to cash used for operating activities:
Impairment charge 243,188 ---
Stock issued for services 10,300 7,000
______________ ______________
Net cash used in operating activities (49,907) (24,562)
CASH FLOWS FROM INVESTING ACTIVITIES:
Net cash provided by (used in) investing activities --- ---
CASH FLOWS FROM FINANCING ACTIVITIES:
Notes payable - third parties 35,000 ---
Loan on open account - third party 30,000 ---
Loan on open account - related party 14,500 ---
Repayment of loan on open account - related party (14,500) ---
Advance on open account - related party (3,896) ---
______________ ______________
Net cash provided by (used in) financing activities 61,104 ---
______________ ______________
Net increase (decrease) in cash 10,273 (2,290)
Cash, beginning of year 924 2,936
______________ ______________
Cash, end of year $ 11,197 $ 646
______________ ______________
______________ ______________
The accompanying notes are an integral part of these unaudited financial statements.
-F-10-
CLIKIA CORP.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
March 31, 2017
(unaudited)
NOTE 1. NATURE OF THE BUSINESS
Clikia Corp. (the Company) was incorporated in 2002 in the State of Nevada, under the name MK
Automotive, Inc. The Company's corporate name changed to Clikia Corp. in July 2017. From 2002
through 2015, the Company was engaged in the retail and commercial automotive diagnostic,
maintenance and repair services businesses, and, from December 2015 through January 2017, our
company pursued the commercial exploitation of Squuak.com, a social media and content sharing
tool and platform. Ultimately, these business efforts were unsuccessful. In February 2017, the
Company acquired Clikia Corp., a Louisiana corporation (Clikia-LA), a Baton Rouge, Louisiana-
based over-the-top, or OTT, video streaming service provider, and adopted the OTT video
streaming business plan of Clikia-LA.
ClikiaTV is the Company's subscription-based streaming cable television service delivered via
its Clikia App, which is available in the iTunes Store, the Google Play Store, on Amazon and
Roku, and via Google Chromecast for any device, and through the Company's interconnected
website, www.Clikia.com, that targets consumers who wish to join the cord-cutting movement,
the movement away from traditional cable television subscriptions.
ClikiaTV competes in the over-the-top content (video) delivery industry. Over-the-top, or OTT,
is the term used to describe the delivery of film and TV content via the internet, without
requiring users to subscribe to a traditional cable or satellite pay-TV service, like Comcast,
Time Warner Cable or DirecTV.
NOTE 2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Basis of Presentation
The accompanying consolidated financial statements have been prepared in conformity with
accounting principles generally accepted in the United States of America.
Principles of Consolidation
The consolidated financial statements include the accounts of the Company and its wholly-owned
subsidiary, Clikia-LA. All inter-company accounts and transactions have been eliminated in
consolidation.
Cash and Cash Equivalents
Cash and cash equivalents include cash on hand and cash in time deposits, certificates of
deposit and all highly liquid investments with original maturities of three months or less.
Stock Issued for Services
The Company accounts for equity instruments issued in exchange for the receipt of goods or
services from persons other than employees in accordance with ASC Topic 505. Costs are
measured at the estimated fair market value of the consideration received or the estimated
fair value of the equity instruments issued, whichever is more reliably measurable. The
value of equity instruments issued for consideration other than employee services is
determined on the earliest of performance commitment or completion of performance by the
provider of goods or services as defined by ASC Topic 505.
Earnings per Share
Basic net income (loss) per share is computed on the basis of the weighted average number
of common shares outstanding during the period.
-F-11-
NOTE 3. ACCOUNTING POLICIES
The Company has evaluated recent accounting pronouncements and believes none will have a
material effect on its consolidated financial statements upon implementation.
NOTE 4. CHANGE IN CONTROL OF THE COMPANY
In September 2016, there occurred a change in control of the Company, when the Company's
now-CEO, David Loflin, acquired ownership of RioRoca Holdings, LLC, the owner of (a)
31,754,675 shares, or approximately 60%, of the Company's then-outstanding common stock
and (b) 2,000,000 shares of the Company's Series A Super Voting Preferred Stock (shares
of Series A Super Voting Preferred Stock have 500 times that number of votes on all
matters submitted to the shareholders that each shareholder of Company common stock is
entitled to vote at each meeting of shareholders and vote together with the holders of
Company common stock as a single class). This ownership of Company securities provides
RioRoca Holdings, LLC with control of the Company. As the owner of RioRoca Holdings,
LLC, Mr. Loflin controls the disposition and voting of Company securities owned by
RioRoca Holdings, LLC.
NOTE 5. EXTINGUISHMENT OF DEBT
In December 2011, the Company entered into a settlement agreement (the Settlement
Agreement) with one of its lenders to satisfy an existing loan default, which resulted
in the extinguishment of such loan. The principal balance of the loan, at the time of
the Settlement Agreement, was $460,410, with related accrued interest of $4,676.
In connection with the Settlement Agreement, two related parties (Michael R. Murphy
and Thomas E. Kubik) loaned a total of $225,704 in cash to the Company. The proceeds
of both of these loans were applied by the Company to satisfy its payment obligation
of $225,704 under the Settlement Agreement. (See Note 6. Related-Party Transactions).
NOTE 6. RELATED-PARTY TRANSACTIONS
In February 2017, the Company acquired Clikia Corp., a Louisiana corporation
(Clikia-LA). Pursuant to the acquisition transaction, the Company's CEO, David Loflin,
received 75,000,000 shares of the 125,000,000 shares of Company common stock issued in
the acquisition transaction. (See Note 8. Acquisitions).
In January 2017, the Company issued 10,000,000 shares of common stock as a bonus to
one of its directors, which shares were valued at $10,000, in the aggregate.
In December 2011, the Company borrowed a total of $225,704 from two shareholders
($112,852 from each of Michael R. Murphy and Thomas E. Kubik). The proceeds of both
loans were applied by the Company to satisfy its payment obligation of $225,704 under
the Settlement Agreement. In connection with Mr. Murphy's loan, the Company issued
a promissory note, face amount $112,852, to Mr. Murphy, in consideration of his
$112,852 loan to the Company. This promissory note, by its original terms, bears no
interest, had a due date of December 31, 2012, and was convertible into shares of
Company common stock at the rate of one share for every $.00001 of debt converted.
However, by agreement with the holder of such promissory note, in April 2017, the
conversion rate under such promissory note was amended to one share for every $.0005
of debt converted. At March 31, 2017 and 2016, the remaining unpaid principal balance
of such promissory note was $48,870 and $49,480, respectively. (See Note 5.
Extinguishment of Debt, Note 7. Notes Payable and Note 10. Subsequent Events).
NOTE 7. NOTES PAYABLE
In February 2017, the Company issued a promissory note, face amount $25,000, to
Schooner Equities, LLC, in consideration of a loan in the amount of $25,000. This
promissory note bears interest at 6% per annum, is due in February 2018 and is
convertible into shares of Company common stock at a conversion price that is equal
to 45% of the then-current market price of the Company's common stock. At March 31,
2017, the remaining unpaid principal balance of such promissory note was $25,000.
In March 2017, the Company issued a promissory note, face amount $10,000, to a third
party, Adam Goodkin, in consideration of a loan in the amount of $10,000. This
promissory note bears interest at 6% per annum, is due in March 2018 and is
convertible into shares of Company common stock at the rate of one share for every
$.00166 of debt converted. At March 31, 2017, the remaining unpaid principal balance
of such promissory note was $10,000.
-F-12-
In August 2015, the Company issued a promissory note, face amount $225,000, to Par
Point Capital, LLC, in connection with the Company's purchase of Squuak.com and
related intangible assets. This promissory note bears interest at 6% per annum, was
due in August 2016 and is convertible into shares of Company common stock at the
rate of one share for every $.0005 of debt converted. At March 31, 2017 and 2016,
the remaining unpaid principal balance of such promissory note was $225,000.
In August 2015, the Company issued a promissory note, face amount $25,000, to Par
Point Capital, LLC, pursuant to a consulting agreement. This promissory note bears
interest at 6% per annum, was due in August 2016 and is convertible into shares of
Company common stock at the rate of one share for every $.0005 of debt converted.
At March 31, 2017 and 2016, the remaining unpaid principal balance of such promissory
note was $18,250 and $25,000, respectively.
In December 2011, the Company issued a promissory note, face amount $112,852, to
Michael R. Murphy, in consideration of his $112,852 loan to the Company. This
promissory note, by its original terms, bears no interest, had a due date of December
31, 2012, and was convertible into shares of Company common stock at the rate of one
share for every $.00001 of debt converted. However, by agreement with the holder of
such promissory note, in April 2017, the conversion rate under such promissory note was
amended to one share for every $.0005 of debt converted. At March 31, 2017 and 2016,
the remaining unpaid principal balance of such promissory note was $48,870 and $49,480,
respectively.
NOTE 8. LOAN ON OPEN ACCOUNT
In February 2017, the Company obtained a loan on open account from a third party in the
amount of $30,000. This loan on open account is payable on demand.
NOTE 9. ACQUISITIONS
In February 2017, the Company acquired Clikia Corp. (Clikia-LA), a Baton Rouge,
Louisiana-based OTT video streaming service provider, adopted the OTT video streaming
business plan of Clikia-LA and is currently pursuing such business plan. The Company's
CEO, David Loflin, received 75,000,000 shares of the 125,000,000 shares of Company
common stock issued in the Clikia-LA acquisition transaction. (See Note 6. Related-Party
Transactions). Subsequent to the closing of this transaction, the Company entered into
a common stock repurchase agreement with TikiLive, Inc., pursuant to which the Company
repurchased 25,000,000 of the shares issued to TikiLive, Inc., in exchange for a
$150,000 face amount promissory note payable by the Company on demand.
In December 2015, the Company acquired Squuak.com, a social media and content sharing
tool and platform, from Par Point Capital, LLC, in exchange for a $225,000 promissory
note. (See Note 7. Notes Payable).
NOTE 10. STOCK ISSUED FOR SERVICES
During the year ended March 31, 2017, the Company issued 300,000 shares of common stock
pursuant to the terms of a consulting agreement with a third party, which shares were
valued at $300, in the aggregate.
During the year ended March 31, 2017, the Company issued 10,000,000 shares of common
stock as a bonus to one of its directors, which shares were valued at $10,000, in the
aggregate.
NOTE 11. IMPAIRMENT
Following the Company's acquisition of Clikia-LA, the Company's Board of Directors
determined to abandon its Squuak.com business efforts, including its related assets.
Due to this determination, there was an impairment charge of $243,188 recorded for the
year ended March 31, 2017.
-F-13-
NOTE 12. SUBSEQUENT EVENTS
In April 2017, the Company entered into an agreement with the holder of a Company
promissory note issued in December 2011 to Michael R. Murphy, face amount $112,852.
Pursuant to such agreement, the conversion rate under such promissory note was changed
from one share for every $.00001 of debt converted to one share for every $.0005 of
debt converted.
In June 2017, the Company issued, in two separate private transactions, a total of
25,000,000 shares of common stock in connection with partial conversions of a convertible
promissory note of the Company. A total of $12,500.00 of the Company's existing debt was
cancelled by the issuance of such shares, a conversion price of $.0005 per share.
In June 2017, the Company issued, in a private transaction, 6,000,000 shares of common
stock to a third-party consultant to the Company, in payment of financial consulting
services rendered on behalf of the Company. Pursuant to the terms of the consulting
agreement, these shares were valued at $10,000.
In July 2017, the Company issued convertible promissory note in the amount of $291,000,
including original issue discount, to a third party. This promissory note is due in
October 2018 and is convertible from time to time by its holder, at then-market
prices of the Company's common stock. The Company also issued to such third party a
warrant to purchase approximately 14,500,000 shares of its common stock. In consideration
of its issuing such promissory note and warrant, the Company received cash in the amount
of $45,000 and a series of nine promissory notes in the amount of $25,000, all of which
are due in October 2018.
In August 2017, the Company entered into a settlement agreement and stipulation (the
Settlement Agreement) with a third party. Pursuant to the Settlement Agreement,
the Company agreed to issue shares of its common stock in exchange for the settlement
of certain past due obligations and accounts payable of the Company (the Subject Debts)
in the aggregate amount of $355,903.50 (the Settlement Amount), which the third party
had previously purchased from certain vendors of the Company. Further, the Company
agreed to issue shares of common stock in one or more tranches, as necessary, sufficient
to satisfy the Settlement Amount. The per share price of the shares of common stock shall
be equal to 50% of the then-recent market price of the Company's common stock.
Additionally, the Company issued 1,704,859 shares of its common stock to the third party
as a settlement fee. Under the Settlement Agreement, the third party is not permitted,
at any time, to own beneficially more than 9.99% of the Company's then-outstanding shares
of common stock. The Company initially reserved 150 million shares of its common stock to
provide for issuances made pursuant to the Settlement Agreement. To date, a total of
27,000,000 shares have been issued in payment of $183,889.50 of the Subject Debts.