The Marquie Group, Inc. (the
“Company’), formerly Music of Your Life, Inc., was incorporated under the laws of the State
of Florida on January 30, 2008 under the name of “Zhong Sen International Tea Company”. From January 2008 to May 2013,
the Company operated with the principal business objective of providing sales and marketing consulting services to small to medium
sized Chinese tea producing companies who wished to export and distribute high quality Chinese tea products worldwide. On May 31,
2013 (the “Closing Date”), the Company entered into a Merger Agreement (the “Merger Agreement”) by and among
the Company, Music of Your Life, Inc., a Nevada corporation (“MYL Nevada”) incorporated October 10, 2012, and Music of
Your Life Merger Sub, Inc., a Utah corporation ("Merger Sub"), pursuant to which MYL Nevada merged with Merger Sub. As a
result of the merger, MYL Nevada became a wholly-owned subsidiary of the Company, and on July 26, 2013, the Company changed its name
to Music of Your Life, Inc., and operated a nationwide syndicated radio network. On May 20, 2014 the Company acquired 100% of the
outstanding stock of iRadio, Inc., a Utah corporation. The Company was the surviving corporation. iRadio was an entity related to
the Company by common ownership.
Effective June 20, 2018, the Company
effectuated a 1 share for 4,000 shares reverse stock split which reduced the issued and outstanding shares of common stock from
3,642,441,577 shares to 910,610 shares. Effective September 4, 2019, the Company effectuated a 1 share for 400 shares reverse stock
split which reduced the issued and outstanding shares of common stock from 430,589,412 shares to 1,061,356 shares. The accompanying
financial statements have been retroactively adjusted to reflect these reverse stock splits.
On August 16, 2018 (see Note 10),
the Company merged with The Marquie Group, Inc. (“TMG”) in exchange for the issuance of a total of 100,000 shares of
our common stock to TMG’s stockholders. Following the merger, the Company had 102,277 shares of common stock issued and outstanding.
On December 5, 2018, the Company amended and restated its Articles of Incorporation providing for a change in the Company’s
name from “Music of Your Life, Inc.” to “The Marquie Group, Inc.” The TMG business plan is to advertise
a direct-to-consumer, health and beauty product line called “Whim” that use innovative formulations of plant-based,
amino-acids and other natural alternatives to chemical ingredients.
On November 21, 2019 (see Note 10),
the Company merged with Global Nutrition Experience, Inc. (“GNE”) in exchange for the issuance of a total of 193,000,000
shares of our common stock to GNE’s stockholder. The GNE business plan is to license intellectual property from, and to third
parties.
This summary of significant accounting
policies of the Company is presented to assist in understanding the Company’s financial statements. The financial statements
and notes are representations of the Company’s management who are responsible for their integrity and objectivity. These
accounting policies conform to accounting principles generally accepted in the United States of America and have been consistently
applied in the preparation of the financial statements. The following policies are considered to be significant:
The consolidated financial statements
have been prepared in accordance with accounting principles generally accepted in the United States and include the Company and
its wholly owned subsidiary. All inter-company accounts and transactions have been eliminated.
The Company recognizes income and
expenses based on the accrual method of accounting. The Company has elected a May 31 year-end.
The preparation of financial statements
in conformity with U.S. generally accepted accounting principles requires management to make estimates and assumptions that affect
the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial
statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those
estimates.
Cash equivalents are generally comprised
of certain highly liquid investments with original maturities of less than three months.
In accordance with Financial Accounting
Standards No. ASC 260, “Earnings per Share,” basic net loss per common share is based on the weighted average number
of shares outstanding during the periods presented. Diluted earnings per share is computed using the weighted average number of
common shares plus dilutive common share equivalents outstanding during the period. Dilutive instruments (such as convertible notes
payable) have not been included in the diluted earnings per share computations as their effect were antidilutive for the periods
presented.
The Company adopted ASC 606 requires
the use of a new five-step model to recognize revenue from customer contracts. The five-step model requires entities to exercise
judgment when considering the terms of contracts, which includes (1) identifying the contracts or agreements with a customer, (2)
identifying our performance obligations in the contract or agreement, (3) determining the transaction price, (4) allocating the
transaction price to the separate performance obligations, and (5) recognizing revenue as each performance obligation is satisfied. Advance
customer payments are recorded as deferred revenue until such time as they are recognized. The Company does not offer any cash
rebates. Returns or discounts, if any, are netted against gross revenues.
Advertising costs, which are expensed
as incurred, were $-0- for the years ended May 31, 2021 and 2020.
Deferred income taxes are provided
on a liability method whereby deferred tax assets are recognized for deductible temporary differences and operating loss and tax
credit carryforwards and deferred tax liabilities are recognized for taxable temporary differences. Temporary differences are the
differences between the reported amounts of assets and liabilities and their tax bases. Deferred tax assets are reduced by a valuation
allowance when, in the opinion of management, it is more likely than not that some portion or all of the deferred tax assets will
not be realized. Deferred tax assets and liabilities are adjusted for the effects of changes in tax laws and rates on the date
of enactment.
At May 31, 2021, the Company had
net operating loss carryforwards of approximately $5,726,737, of which $3,035,346 expires in varying amounts through 2038 and $2,691,391
does not expire. No tax benefit has been reported in the financial statements because the potential tax benefits of the net operating
loss carryforwards are offset by a valuation allowance of the same amount.
Due to the change in ownership provisions
of the Tax Reform Act of 1986, net operating loss carryforwards for Federal income tax reporting purposes are subject to annual
limitations. Should a substantial change in ownership occur, net operating loss carryforwards may be limited as to future use.
Net deferred tax
assets consist of the following components as of May 31, 2021 and 2020:
The income tax provision differs
from the amount of income tax determined by applying the U.S. federal income tax rate of 21% to pretax income (loss) for the years
ended May 31, 2021 and 2020 due to the following:
For the periods presented, the Company had no tax
positions or unrecognized tax benefits.
The Company includes interest
and penalties arising from the underpayment of income taxes in the consolidated statements of operations in the provision for income
taxes. For the periods presented, the Company had no such interest or penalties.
Financial instruments that potentially
subject the Company to concentrations of credit risks consist of cash and cash equivalents. The Company places cash and cash equivalents
at well-known quality financial institutions. Cash and cash equivalents at banks are insured by the Federal Deposit Insurance Corporation
for up to $250,000. The Company did not have any cash or cash equivalents in excess of this amount at May 31, 2021.
We have reviewed accounting pronouncements
issued and have adopted any that are applicable to the Company. We have determined that none had a material impact on our financial
position, results of operations, or cash flows for the years ended May 31, 2021 and 2020.
Certain other accounting pronouncements
have been issued by the FASB and other standard setting organizations which are not yet effective and therefore have not yet been
adopted by the Company. The impact on the Company’s financial position and results of operations from adoption of these standards
is not expected to be material.
Level 1 inputs
to the valuation methodology are quoted prices (unadjusted) for identical assets or liabilities in active markets.
Level 2 inputs
to the valuation methodology include quoted prices for similar assets and liabilities in active markets, and inputs that are observable
for the asset or liability, either directly or indirectly, for substantially the full term of the financial instrument.
Level 3 inputs
to valuation methodology are unobservable and significant to the fair measurement.
The carrying amounts reported in
the balance sheets for the cash and cash equivalents, receivables and current liabilities each qualify as financial instruments
and are a reasonable estimate of fair value because of the short period of time between the origination of such instruments and
their expected realization and their current market rate of interest.
During the year ended May 31, 2013,
the Company loaned $174,950 to the Company’s current chief executive in anticipation of the merger agreement described in
Note 1. The loans were non-interest bearing and due on demand. Effective May 31, 2015, the Company agreed to waive collection of
$100,000 of the remaining $115,950 loans receivable balance in exchange for the chief executive officer’s agreement to waive
payment of the $100,000 accrued consulting fees balance due him at May 31, 2015. Effective May 31, 2020, the Company agreed to
waive collection of $15,950 of the remaining loans receivable balance in exchange for the chief executive officer’s agreement
to waive payment of $15,950 accrued consulting fees balance due him at May 31, 2020 (see Note 11). As of May 31, 2021 and 2020,
the balance due on this loan was $-0-.
The Company purchases digital music
to broadcast over the radio and internet. During the year ended May 31, 2021, the Company purchased $183 worth of music inventory.
For the years ended May 31, 2021 and 2020, depreciation on music inventory was $3,096 and $3,564, respectively.
THE MARQUIE GROUP, INC.
(formerly Music of Your Life, Inc.)
Notes to the Consolidated Financial Statements
May 31, 2021
Convertible note payable to an entity, interest at 10%, due on April 23, 2020, in default (QQ) | |
| — | | |
| 250,000 | |
Convertible note payable to an entity, interest at 10%, due on August 20, 2021 (RR) | |
| — | | |
| — | |
Convertible note payable to an entity, interest at 12%, due on November 30, 2021 – net of discount of $85,233 and $-0-, respectively (SS) | |
| 84,767 | | |
| — | |
Convertible note payable to an entity, interest at 12%, due on December 30, 2021 (TT) | |
| 50,000 | | |
| — | |
Convertible note payable to an entity, interest at 12%, due on April 15, 2022 (UU) | |
| 55,000 | | |
| — | |
Note payable to the Small Business Administration under the Payroll Protection Program, interest at 1%, due in installments through May 4, 2022, forgivable in part or whole subject to certain requirements. | |
| 170,000 | | |
| 70,000 | |
Notes payable to individuals, non-interest bearing, due on demand | |
| 103,476 | | |
| 103,476 | |
Total Notes Payable | |
| 1,366,430 | | |
| 1,536,575 | |
Less: Current Portion | |
| (1,366,430 | ) | |
| (1,536,575 | ) |
Long-Term Notes Payable | |
$ | — | | |
$ | — | |
(B) On April 22, 2015, the Company
issued a $25,000 Promissory Note, non-interest bearing (interest at 24% per annum after May 22, 2015), due at maturity on May 22,
2015.
(D) On July 24, 2015, the Company
issued a $50,000 Promissory Note to Kodiak Capital Group, LLC (“Kodiak”) for services rendered in association with
an Equity Purchase Agreement. As amended and restated January 4, 2016, the note is non-interest bearing and was due on February
1, 2016.
(E) On July 31, 2015, the Company
issued a $25,000 Promissory Note with a stated interest amount of $2,500 due at maturity on October 31, 2015.
(G) On August 6, 2015, the Company
issued a $50,000 Promissory Note with a stated interest amount of $5,000 due at maturity on October 21, 2015.
(H) On August 21, 2015, the Company
issued a $50,000 Promissory Note with a stated interest amount of $5,000 due at maturity on November 6, 2015.
(I) On September 21, 2015, the Company
issued a $25,000 Promissory Note with a stated interest amount of $2,500 due at maturity on December 20, 2015. In the event that
all principal and interest are not paid to the lender by January 20, 2016, interest is to accrue at a rate of 24% per annum commencing
on January 21, 2016.
(M) On December 29, 2015, the Company
issued a $20,000 Convertible Promissory Note to a lender for net loan proceeds of $15,000. The note bears interest at a rate of
12% per annum, was due on December 29, 2016, and is convertible at the option of the lender into shares of the Company common stock
at a Conversion Price equal to 50% of the lowest closing bid price during the 30 Trading Day period prior to the Conversion Date.
See Note 9 (Derivative Liability).
THE MARQUIE GROUP, INC.
(formerly Music of Your Life, Inc.)
Notes to the Consolidated Financial Statements
May 31, 2021
(P) On June 3, 2016, the Company
issued a $25,000 Promissory Note. The note bears interest at a rate of 10% per annum and was due on November 30, 2016.
(V) On May 3, 2017, the Company issued
a $72,750 Convertible Promissory Note to a lender as a replacement for the principal and interest due on a promissory note due
on October 14, 2014. The note bears interest at a rate of 10% per annum, is due on demand, and is convertible at the option of
the lender into shares of the Company common stock at a Conversion Price equal to $0.0001293 per share.
(W) On April 5, 2017, the Company
issued a $35,000 Convertible Promissory Note to a lender as a replacement for the principal and interest due on a promissory note
due on August 23, 2015. The note bears interest at a rate of 8% per annum, is due on demand, and is convertible at the option of
the lender into shares of the Company common stock at a Conversion Price equal to 40% of the lowest Trading Price during the 5
Trading Day period prior to the Conversion Date. See Note 9 (Derivative Liability).
(X) On April 5, 2017, the Company
issued a $27,500 Convertible Promissory Note to a lender as a replacement for the principal and interest due on a promissory note
due on October 31, 2015. The note bears interest at a rate of 8% per annum, is due on demand, and is convertible at the option
of the lender into shares of the Company common stock at a Conversion Price equal to 40% of the lowest Trading Price during the
5 Trading Day period prior to the Conversion Date. See Note 9 (Derivative Liability).
(Y) On March 1, 2017, the Company
issued a $8,600 Convertible Promissory Note to a vendor of the Company to convert certain accounts payable due to the vendor. The
note bears interest at a rate of 10% per annum, is due on demand, and is convertible at the option of the lender into shares of
the Company common stock at a Conversion Price equal to the higher of $0.00004 per share or 60% of the lowest Trading Price during
the 5 Trading Day period prior to the Conversion Date.
(AA) On January 11, 2018, the Company
issued a $500,000 Convertible Promissory Note to a lender. During the quarter ended February 28, 2018, the Company borrowed $88,000
(of the $500,000), and received net loan proceeds of $75,000. The note bears interest at a rate of 10% per annum (15% per annum
default rate) and is convertible at the option of the lender into shares of the Company common stock at a Conversion Price equal
to 50% of the lowest Trading Price during the 15 Trading Day period prior to the Conversion Date. See Note 9 (Derivative Liability).
The maturity date for each tranche funded is twelve months from the effective date of each payment.
(CC) On December 1, 2017, the Company
issued a $50,000 Convertible Promissory Note to a vendor in settlement of certain accrued consulting fees of $50,000. The note
bears interest at a rate of 10% per annum, is due on demand, and is convertible at the option of the lender into shares of the
Company common stock at a Conversion Price equal to 60% of the lowest Trading Price during the 20 Trading Day period prior to the
Conversion Date. See Note 9 (Derivative Liability).
(DD) On March 5, 2018, the Company
issued a $35,000 Convertible Promissory Note to a lender for net loan proceeds of $33,000. The note bears interest at a rate of
10% per annum, was due on March 5, 2019, and is convertible at the option of the lender into shares of the Company common stock
at a Conversion Price equal to 50% of the lowest Trading Price during the 20 Trading Day period prior to the Conversion Date. See
Note 9 (Derivative Liability).
(EE) On April 4, 2018, the Company
issued a $37,500 Convertible Promissory Note (Tranche 2 of (AA) above) to a lender for net loan proceeds of $35,500. The note bears
interest at a rate of 10% per annum, was due on April 4, 2019, and is convertible at the option of the lender into shares of the
Company common stock at a Conversion Price equal to 50% of the lowest Trading Price during the 20 Trading Day period prior to the
Conversion Date. See Note 9 (Derivative Liability).
THE MARQUIE GROUP, INC.
(formerly Music of Your Life, Inc.)
Notes to the Consolidated Financial Statements
May 31, 2021
(FF) On September 18, 2018, the Company
issued a $22,500 Convertible Promissory Note (Tranche 3 of (AA) above) to a lender for net loan proceeds of $17,500. The note bears
interest at a rate of 10% per annum, was due on September 18, 2019, and is convertible at the option of the lender into shares
of the Company common stock at a Conversion Price equal to 50% of the lowest Trading Price during the 20 Trading Day period prior
to the Conversion Date. See Note 9 (Derivative Liability).
(GG) On September 18, 2018, the Company
issued a $18,000 Convertible Promissory Note to a lender for net loan proceeds of $14,000. The note bears interest at a rate of
10% per annum, was due on September 18, 2019, and is convertible at the option of the lender into shares of the Company common
stock at a Conversion Price equal to 50% of the lowest Trading Price during the 20 Trading Day period prior to the Conversion Date.
See Note 9 (Derivative Liability).
(HH) On December 19, 2018, the Company
issued a $200,000 Convertible Promissory Note to a lender for net loan proceeds of $169,000. The note bears interest at a rate
of 10% per annum, was due on September 19, 2019, and is convertible at the option of the lender into shares of the Company common
stock at a Conversion Price equal to the lesser of (i) the lowest Trading Price during the 25 Trading Day period prior to December
19, 2018 or (ii) 50% of the lowest Trading Price during the 25 Trading Day period prior to the Conversion Date. See Note 9 (Derivative
Liability).
(II) On February 4, 2019, the Company
issued a $170,000 Convertible Promissory Note to a lender for net loan proceeds of $149,955. The note bears interest at a rate
of 10% per annum, was due on August 4, 2019, and is convertible at the option of the lender into shares of the Company common stock
at a Conversion Price equal to 50% of the lowest Trading Price during the 25 Trading Day period prior to the Conversion Date. See
Note 9 (Derivative Liability).
(JJ) On February 13, 2019, the Company
issued a $75,000 Convertible Promissory Note to a lender for net loan proceeds of $67,500. The note bears interest at a rate of
10% per annum, was due on November 13, 2019, and is convertible at the option of the lender into shares of the Company common stock
at a Conversion Price equal to 50% of the lowest Trading Price during the 20 Trading Day period prior to the Conversion Date. See
Note 9 (Derivative Liability).
(KK) On November 15, 2018, the Company
issued a $20,000 Convertible Promissory Note (Tranche 4 of (AA) above) to a lender for net loan proceeds of $20,000. The note bears
interest at a rate of 10% per annum, was due on November 15, 2019, and is convertible at the option of the lender into shares of
the Company common stock at a Conversion Price equal to 50% of the lowest Trading Price during the 20 Trading Day period prior
to the Conversion Date. See Note 9 (Derivative Liability).
(LL) On November 30, 2018, the Company
issued a $5,000 Convertible Promissory Note (Tranche 5 of (AA) above) to a lender for net loan proceeds of $5,000. The note bears
interest at a rate of 10% per annum, was due on November 30, 2019, and is convertible at the option of the lender into shares of
the Company common stock at a Conversion Price equal to 50% of the lowest Trading Price during the 20 Trading Day period prior
to the Conversion Date. See Note 9 (Derivative Liability).
(MM) On December 6, 2018, the Company
issued a $3,000 Convertible Promissory Note (Tranche 6 of (AA) above) to a lender for net loan proceeds of $3,000. The note bears
interest at a rate of 10% per annum, was due on December 6, 2019, and is convertible at the option of the lender into shares of
the Company common stock at a Conversion Price equal to 50% of the lowest Trading Price during the 20 Trading Day period prior
to the Conversion Date. See Note 9 (Derivative Liability).
THE MARQUIE GROUP, INC.
(formerly Music of Your Life, Inc.)
Notes to the Consolidated Financial Statements
May 31, 2021
(NN) On December 11, 2018, the Company
issued a $10,000 Convertible Promissory Note (Tranche 7 of (AA) above) to a lender for net loan proceeds of $10,000. The note bears
interest at a rate of 10% per annum, was due on December 11, 2019, and was convertible at the option of the lender into shares
of the Company common stock at a Conversion Price equal to 50% of the lowest Trading Price during the 20 Trading Day period prior
to the Conversion Date. See Note 9 (Derivative Liability).
(OO) On June 10, 2019, the Company
issued a $58,750 Convertible Promissory Note to a lender for net loan proceeds of $50,000. The note bears interest at a rate of
12% per annum (24% per annum default rate), was due on March 10, 2020, and is convertible at the option of the lender into shares
of the Company common stock at a Conversion Price equal to 50% of the lowest Trading Price during the 25 Trading Day period prior
to the Conversion Date. See Note 9 (Derivative Liability).
(PP) On September 5, 2019, the Company
issued a $12,500 Convertible Promissory Note to a lender for net loan proceeds of $10,000. The note bears interest at a rate of
10% per annum, was due on September 5, 2020, and is convertible at the option of the lender into shares of the Company common stock
at a Conversion Price equal to 50% of the lowest Trading Price during the 20 Trading Day period prior to the Conversion Date. See
Note 9 (Derivative Liability).
(QQ) On October 23, 2019, the Company
issued a $260,000 Convertible Promissory Note to a lender for net loan proceeds of $234,000. The note bears interest at a rate
of 10% per annum, was due on April 23, 2020, and is convertible at the option of the lender into shares of the Company common stock
at a Conversion Price equal to 50% of the lowest Trading Price during the 25 Trading Day period prior to the Conversion Date. See
Note 9 (Derivative Liability).
(RR) On August 20, 2020, the Company
issued a $385,000 Convertible Promissory Note to a lender which paid off the principal and accrued interest for the note described
in (QQ) above. The note bears interest at a rate of 10% per annum, is due on August 20, 2021, and is convertible at the option
of the lender into shares of the Company common stock at a Conversion Price equal to the higher of (1) the closing bid price of
the Common Stock on the Trading Day immediately preceding the date of the conversion, or (2) the par value of the Common Stock.
See Note 7 (Derivative Liability).
(SS) On November 30, 2020, the Company
issued a $170,000 Convertible Promissory Note to a lender which paid off some of the accrued interest for the note described in
(RR) above. The Company received net proceeds of $32,500. The note bears interest at a rate of 12% per annum, is due on November
30, 2021, and is convertible at the option of the lender into shares of the Company common stock at a Conversion Price equal to
the lesser of (1) 105% of the closing bid price of the Common Stock on the Issue Date, or (2) the closing bid price of the Common
Stock on the Trading Day immediately preceding the date of the conversion. See Note 7 (Derivative Liability).
(TT) On December 30, 2020, the Company
issued a $50,000 Promissory Note. The note bears interest at a rate of 12% per annum and is due on December 30, 2021.
(UU) On April 15, 2021, the Company
issued a $55,000 Convertible Promissory Note to a lender for net loan proceeds of $45,000. The note bears interest at a rate of
12% per annum, is due on April 15, 2022, and is convertible at the option of the lender into shares of the Company common stock
at a Conversion Price equal to the higher of (1) $0.0009, or (2) the par value of the Common Stock.
THE MARQUIE GROUP, INC.
(formerly Music of Your Life, Inc.)
Notes to the Consolidated Financial Statements
May 31, 2021
Concentration of Notes Payable:
The principal balance of the notes
payable was due to:
| |
May
31, 2021 | |
May
31, 2020 |
| |
| |
|
Lender A | |
$ | 23,167 | | |
$ | 23,167 | |
Lender B | |
| 284,470 | | |
| 258,750 | |
Lender C | |
| 225,000 | | |
| 420,000 | |
Lender D | |
| 110,500 | | |
| 110,500 | |
14
other lenders | |
| 808,526 | | |
| 727,471 | |
| |
| | | |
| | |
Total | |
| 1,451,663 | | |
| 1,539,888 | |
| |
| | | |
| | |
Less
debt discounts | |
| (85,233 | ) | |
| (3,313 | ) |
| |
| | | |
| | |
Net | |
$ | 1,366,430 | | |
$ | 1,536,575 | |
NOTE 8 – NOTES PAYABLE – RELATED PARTIES
Notes payable – related parties
consisted of the following:
| |
May 31, 2021 | |
May 31, 2020 |
Note payable to Company law firm (and owner of 2,500 shares of common stock since August 16, 2018), non-interest bearing, due on demand, unsecured | |
$ | 2,073 | | |
$ | 2,073 | |
Notes payable to The OZ Corporation (owner of 2,500 shares of common stock since August 16, 2018), non-interest bearing, due on demand, unsecured | |
| 69,250 | | |
| 103,250 | |
Convertible note payable to John D. Thomas P.C. (Company law firm and owner of 25,000 shares of common stock since August 16, 2018), interest at 10%, due on demand, convertible at the option of the lender into shares of Company common stock at a Conversion Price equal to 60% of the lowest Trading Price during the 20 Trading Day period prior to the Conversion Date. See Note 9 (Derivative Liability) | |
| 50,000 | | |
| 50,000 | |
Total Notes Payable | |
| 121,323 | | |
| 155,323 | |
Less: Current Portion | |
| (121,323 | ) | |
| (155,323 | ) |
Long-Term Notes Payable | |
$ | — | | |
$ | — | |
THE MARQUIE GROUP, INC.
(formerly Music of Your Life, Inc.)
Notes to the Consolidated Financial Statements
May 31, 2021
NOTE 9 - DERIVATIVE LIABILITY
The derivative liability at May 31,
2021 and 2020 consisted of:
| |
May
31, 2021 | |
May
31, 2020 |
| |
Face
Value | |
Derivative
Liability | |
Face
Value | |
Derivative
Liability |
Convertible note
payable issued December 29, 2015, due December 29, 2016 (M) | |
$ | 40,000 | | |
$ | 48,000 | | |
$ | 40,000 | | |
$ | 53,333 | |
| |
| | | |
| | | |
| | | |
| | |
Convertible note payable
issued April 5, 2017, due on demand (W) | |
| 29,000 | | |
| 58,000 | | |
| 29,000 | | |
| 38,667 | |
Convertible note payable
issued April 5, 2017, due on demand (X) | |
| 21,500 | | |
| 43,000 | | |
| 21,500 | | |
| 28,667 | |
Convertible note payable
issued January 11, 2018 (AA) | |
| 23,167 | | |
| 27,800 | | |
| 23,167 | | |
| 30,889 | |
Convertible note payable
issued December 1, 2017, due on demand (BB) | |
| 50,000 | | |
| 50,000 | | |
| 50,000 | | |
| 50,000 | |
Convertible note payable
issued December 1, 2017, due on demand (CC) | |
| 50,000 | | |
| 50,000 | | |
| 50,000 | | |
| 50,000 | |
Convertible note payable
issued March 5, 2018, due on March 5, 2019 (DD) | |
| 35,000 | | |
| 42,000 | | |
| 35,000 | | |
| 46,667 | |
Convertible note payable
issued April 4, 2018, due on April 4, 2019 (EE) | |
| 37,500 | | |
| 45,000 | | |
| 37,500 | | |
| 50,000 | |
Convertible note payable
issued September 18, 2018, due on September 18, 2019 (FF) | |
| 22,500 | | |
| 27,000 | | |
| 22,500 | | |
| 30,000 | |
Convertible note payable
issued September 18, 2018, due on September 18, 2019 (GG) | |
| 8,506 | | |
| 10,208 | | |
| 8,506 | | |
| 34,022 | |
Convertible note payable
issued December 19, 2018, due on September 19, 2019 (HH) | |
| 200,000 | | |
| 223,384 | | |
| 200,000 | | |
| 266,667 | |
Convertible note payable
issued February 4, 2019, due on August 4, 2019 (II) | |
| 170,000 | | |
| 151,009 | | |
| 170,000 | | |
| 226,667 | |
| |
| | | |
| | | |
| | | |
| | |
THE MARQUIE GROUP, INC.
(formerly Music of Your Life, Inc.)
Notes to the Consolidated Financial Statements
May 31, 2021
Convertible note
payable issued February 13, 2019, due on November 13, 2019 (JJ) | |
| 75,000 | | |
| 80,314 | | |
| 75,000 | | |
| 100,000 | |
Convertible note payable
issued November 15, 2018, due on November 15, 2019 (KK) | |
| 20,000 | | |
| 24,000 | | |
| 20,000 | | |
| 26,667 | |
Convertible note payable
issued November 30, 2018, due on November 30, 2019 (LL) | |
| 5,000 | | |
| 6,000 | | |
| 5,000 | | |
| 6,667 | |
Convertible note payable
issued December 6, 2018, due on December 6, 2019 (MM) | |
| 3,000 | | |
| 3,600 | | |
| 3,000 | | |
| 4,000 | |
Convertible note payable
issued December 11, 2018, due on December 11, 2019 (NN) | |
| 10,000 | | |
| 12,000 | | |
| 10,000 | | |
| 13,333 | |
Convertible note payable
issued June 10, 2019, due on March 10, 2020 (OO) | |
| 58,750 | | |
| 70,500 | | |
| 58,750 | | |
| 78,333 | |
Convertible note payable
issued September 5, 2019, due on September 5, 2020 (PP) | |
| 12,500 | | |
| 15,000 | | |
| 12,500 | | |
| 20,833 | |
Convertible note payable
issued October 23, 2019, due on April 23, 2020 (QQ) | |
| — | | |
| — | | |
| 250,000 | | |
| 333,333 | |
Convertible
note payable issued November 30, 2020, due on November 30, 2021 (SS) | |
| 170,000 | | |
| 1,020,000 | | |
| — | | |
| — | |
Totals | |
$ | 1,041,423 | | |
$ | 2,006,815 | | |
$ | 1,121,423 | | |
$ | 1,488,745 | |
The above convertible notes contain
a variable conversion feature based on the future trading price of the Company common stock. Therefore, the number of shares of
common stock issuable upon conversion of the notes is indeterminate. Accordingly, we have recorded the fair value of the embedded
conversion features as a derivative liability at the respective issuance dates of the notes and charged the applicable amounts
to debt discounts and the remainder to other expense. The increase (decrease) in the fair value of the derivative liability from
the respective issuance dates of the notes to the measurement dates is charged (credited) to other expense (income). The fair value
of the derivative liability of the notes is measured at the respective issuance dates and quarterly thereafter using the Black
Scholes option pricing model.
Assumptions used for the calculations
of the derivative liability of the notes at May 31, 2021 include (1) stock price of $0.0006 per share, (2) exercise prices ranging
from $0.0001 to $0.0005 per share, (3) terms ranging from 0 days to 183 days, (4) expected volatility of 996% and (5) risk free
interest rates ranging from 0.01% to 0.03%.
Assumptions used for the calculations
of the derivative liability of the notes at May 31, 2020 include (1) stock price of $0.0005 per share, (2) exercise prices ranging
from $0.00012 to $0.00018 per share, (3) terms ranging from 0 days to 97 days, (4) expected volatility of 863% and (5) risk free
interest rates ranging from 0.13% to 0.14%.
THE MARQUIE GROUP, INC.
(formerly Music of Your Life, Inc.)
Notes to the Consolidated Financial Statements
May 31, 2021
Concentration of Derivative Liability:
The derivative liability relates
to convertible notes payable due to:
| |
May
31, 2021 | |
May
31, 2020 |
| |
| |
|
Lender A | |
$ | 27,801 | | |
$ | 30,889 | |
Lender B | |
| 293,884 | | |
| 345,000 | |
Lender C | |
| 1,171,009 | | |
| 560,000 | |
Lender D | |
| 80,316 | | |
| 100,000 | |
Lender E | |
| 82,600 | | |
| 151,500 | |
6
other lenders | |
| 351,205 | | |
| 301,356 | |
| |
| | | |
| | |
Total | |
$ | 2,006,815 | | |
$ | 1,488,745 | |
NOTE 10 - EQUITY TRANSACTIONS
On October 3, 2016, the Company amended
its Articles of Incorporation to increase the number of authorized shares of common stock from 500,000,000 to 2,000,000,000 shares
and to change the par value of both the common stock and preferred stock from $0.001 per share to $0.0001 per share.
On November 9, 2016, the Company
amended its Articles of Incorporation to increase the number of authorized shares of common stock from 2,000,000,000 to 10,000,000,000
shares and to amend the voting rights for the Series A Preferred Stock. As amended, each share of Series A Preferred Stock shall
have voting rights equal to four times the sum of (a) all shares of Common Stock issued and outstanding at the time of voting;
plus (b) the total number of votes of all other classes of preferred stock which are issued and outstanding at the time of voting;
divided by (c) the number of shares of Series A Preferred Stock issued and outstanding at the time of voting. The Series A Preferred
Stock has no conversion, liquidation, or dividend rights.
On August 16, 2018, the Company entered
into a Merger Agreement by and among the Company, and The Marquie Group, Inc., a Utah Corporation (“TMG”), pursuant
to which the Company merged with TMG. The Company is the surviving corporation. Each shareholder of TMG received one (1) share
of common stock of the Company for every one (1) share of TMG common stock held as of August 16, 2018. In accordance with the terms
of the merger agreement, all of the shares of TMG held by TMG shareholders were cancelled, and 100,000 shares of common stock of
the Company were issued to the TMG shareholders.
TMG was incorporated on August 3,
2018. The merger provides the Company with certain registered trademarks and intellectual property of TMG with respect to health,
beauty, and social networking products. The three stockholders of TMG prior to the merger who received the 100,000 shares are (1)
Marc Angell (CEO of the Company) and Jacquie Angell (50,000 shares), (2) The OZ Corporation (holder of $103,250 of Company notes
payable at May 31, 2020 and 2019 (25,000 shares), and (3) John Thomas P.C. (Company law firm and holder of $52,073 of Company notes
payable at May 31, 2020 and 2019 (25,000 shares). Pursuant to ASC 805-50-30-5 relating to transactions between entities under common
control, the intellectual property of TMG (and the issuance of the 100,000 shares of common stock) was recorded at $-0-, the historical
cost of the property to TMGI.
During the year ended May 31, 2020,
the Company issued an aggregate of 62,458,453 shares of common stock for the conversion of notes payable and accrued interest in
the aggregate amount of $78,315. We incurred a loss on the conversion of notes payable and accrued interest of $159,802, which
represents the excess of the $238,117 fair value of the 62,458,453 shares at the dates of conversion over the $78,315 amount of
debt satisfied.
THE MARQUIE GROUP, INC.
(formerly Music of Your Life, Inc.)
Notes to the Consolidated Financial Statements
May 31, 2021
On August 28, 2019, the Securities
and Exchange Commission (the “SEC”) issued a Notice of Qualification regarding a Form 1-A filed by the Company in connection
with the Company’s offering of up to 1,333,333,333 shares of common stock at a price of $0.0075 per share or a total offering
of $10,000,000. On December 26, 2019, the Company amended its Form 1-A Offering Circular to reduce the offering price from $0.0075
per share to $0.0035 per share. On February 25,2020, the Company amended its Form 1-A Offering Circular to reduce the offering
price to $0.0007 per share. As part of this offering, during the year ended May 31, 2020, the Company issued an aggregate of 117,866,667
shares of common stock for cash in the amount of $320,400. The end date of the offering was August 28, 2020.
On November 21, 2019, the Company
merged with Global Nutrition Experience, Inc. (“GNE”) in exchange for the issuance of a total of 160,000,000 shares
of our common stock to GNE’s stockholders. Following the merger, the Company had 161,061,647 shares of common stock issued
and outstanding. GNE was incorporated on November 21, 2019. The stockholder of GNE prior to the merger who received the 160,000,000
shares was the Angell Family Trust. Pursuant to ASC 805-50-30-5 relating to transactions between entities under common control,
the intellectual property of GNE (and the issuance of the 160,000,000 shares of common stock) were recorded at $-0-, the historical
cost of the property to GNE. During the three months ended February 29, 2020, the Company issued an additional 33,000,000 shares
of common stock as part of the merger.
During the year ended May 31, 2021,
the Company issued an aggregate of 4,304,842,121 shares of common stock for the conversion of notes payable and accrued interest
in the aggregate amount of $835,050. We incurred a loss on the conversion of notes payable and accrued interest of $1,445,042,
which represents the excess of the $2,280,092 fair value of the 4,304,842,121 shares at the dates of conversion over the $835,050
amount of debt satisfied.
At May 31, 2021 and 2020, there are
no stock options or warrants outstanding.
NOTE 11 - COMMITMENTS AND CONTINGENCIES
Consulting Agreements with Individuals
The Company has entered into Consulting
Agreements with the Company’s Chief Executive Officer, the wife of the Company’s Chief Executive Officer, the mother
of the Company’s Chief Executive Officer, and other service providers (see Note 6 – Accrued Consulting Fees). The Consulting
Agreement with the Company’s Chief Executive Officer provides for monthly compensation of $10,000 and has a term expiring
December 31, 2021. The Consulting Agreement with the wife of the Company’s Chief Executive Officer provided for monthly compensation
of $15,000 and has a term expiring July 31, 2021. The Consulting Agreement with the mother of the Company’s Chief Executive
Officer provides for monthly compensation of $5,000 and was terminated as of November 30, 2019. The other 3 consulting agreements
provided for monthly compensation totaling $6,500 and were terminated as of November 30, 2019.
Corporate Consulting Agreement
On March 14, 2018, the Company executed
a Corporate Consulting Agreement (the “Agreement”) with a consulting firm entity (the “Consultant”). The
Agreement provided for the Consultant to perform certain investor relations and other services for the Company. The term of the
Agreement was 4 months but the Agreement provided that the Company could terminate the Agreement for any reason at any time upon
5 days written prior notice. The Agreement provided for 8 payments of cash fees totaling $240,000 to be paid to the Consultant
over 4 months. On April 1, 2018, the Company notified the Consultant that the Agreement was terminated. A total of $25,000 was
paid to the Consultant in March 2018 which was expensed and included in “Salaries and Consulting Fees” in the Consolidated
Statement of Operations for the year ended May 31, 2018. No other amounts were accrued at May 31, 2021 and 2020. On October 16,
2018 (see Note 10), the Company issued 5,000 shares of its common stock to the Consultant. On October 26, 2018, the Consultant
advised the Company that it had not been notified that the Agreement was terminated on April 1, 2018 and that the Company is in
default of the Agreement.
THE MARQUIE GROUP, INC.
(formerly Music of Your Life, Inc.)
Notes to the Consolidated Financial Statements
May 31, 2021
Consulting Agreement with New
Jersey Entity
On December 5, 2019 and January 13, 2020, the Company
paid $50,000 and $50,000, respectively to a consulting firm entity (the “Consultant”) pursuant to Consulting Agreements
dated December 4, 2019 and January 11, 2020. The Consulting Agreements provided for the Consultant to perform certain strategic
planning, business development, and investor relations services for the Company for total compensation of $100,000 cash (which
was expensed and included in “Other Selling, General and Administrative Expenses” in the Consolidated Statement of
Operations for the three months ended February 29, 2020. The terms of the Consulting Agreements were for 90 days each.
NOTE 12 - GOING CONCERN
The accompanying financial statements
have been prepared assuming that the Company will continue as a going concern, which contemplates the realization of assets and
satisfaction of liabilities in the normal course of business. At May 31, 2021, the Company had negative working capital of $4,780,792
and an accumulated deficit of $11,762,237. These factors raise substantial doubt regarding the Company’s ability to continue
as a going concern.
To date the Company has funded its
operations through a combination of loans and sales of common stock. The Company anticipates another net loss for the fiscal year
ended May 31, 2022 and with the expected cash requirements for the coming year, there is substantial doubt as to the Company’s
ability to continue operations.
The Company is attempting to improve
these conditions by way of financial assistance through issuances of additional equity and by generating revenues through sales
of products and services.
The financial statements do not include
any adjustments that might result from the outcome of this uncertainty.
NOTE 13 – SUBSEQUENT EVENTS
From June 1, 2021 to October 1, 2021,
the Company issued a total of 3,298,115,857 shares of its common stock for the conversion of notes payable and accrued interest
in the aggregate amount of $58,606. The $1,614,492 excess of the $1,673,098 fair value of the 3,298,115,857 shares at the dates
of conversion over the $58,606 of debt satisfied will be charged to “Loss on conversion of notes payable and accrued interest”
in the three months ended August 31, 2021.