MAJOR LEAGUE FOOTBALL INC - Quarter Report: 2019 January (Form 10-Q)

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

For the quarterly period ended January 31, 2019

OR

For the transition period from ______ to _______

Commission File Number: 000-51132

Registrant’s telephone number, including area code: (847) 924-4332

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

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

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

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

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

TABLE OF CONTENTS

PART I – FINANCIAL INFORMATION

Item 1. Financial Statements 

MAJOR LEAGUE FOOTBALL, INC.

FINANCIAL STATEMENTS

January 31, 2019

(UNAUDITED)

CONTENTS

MAJOR LEAGUE FOOTBALL, INC.

BALANCE SHEETS

See accompanying condensed notes to these unaudited financial statements.

MAJOR LEAGUE FOOTBALL, INC.

STATEMENTS OF OPERATIONS

(UNAUDITED)

See accompanying condensed notes to these unaudited financial statements.

MAJOR LEAGUE FOOTBALL, INC.

STATEMENTS OF CHANGES IN STOCKHOLDERS’ DEFICIT

FOR THE THREE AND NINE MONTHS ENDED JANUARY 31, 2019 AND 2018

(UNAUDITED)

See accompanying condensed notes to these unaudited financial statements.

MAJOR LEAGUE FOOTBALL, INC.

STATEMENTS OF CHANGES IN STOCKHOLDERS’ DEFICIT (Continued)

See accompanying condensed notes to these unaudited financial statements.

MAJOR LEAGUE FOOTBALL, INC.

STATEMENTS OF CASH FLOWS

(UNAUDITED)

See accompanying condensed notes to these unaudited financial statements.

MAJOR LEAGUE FOOTBALL, INC.

CONDENSED NOTES TO FINANCIAL STATEMENTS (UNAUDITED)

January 31, 2019

NOTE 1- NATURE OF OPERATIONS, BASIS OF PRESENTATION, GOING CONCERN, AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Major League Football, Inc. (the “Company”) is seeking to establish, develop and operate MLFB as a professional spring/summer football league. Our anticipated launch is a training camp in March of 2019 with a regular eight team season commencing in May 2019 with playoffs and a championship game in July of 2019. In conjunction with the 2019 season, we intend to establish franchises in cities overlooked by existing professional sports leagues and provide fans with professional football in the NFL off-seasons, which will enable us to take a totally non-adversarial approach towards the National Football League (“NFL”). Our spring and early summer schedule ensures no direct competition with autumn/winter football, including the 32 NFL, 9 Canadian Football League, 627 NCAA, 91 NAIA, 142 JUCO’s, 27 Canadian Universities, and thousands of high school and collegiate institution teams.

Unless the context otherwise requires, all references to the “Company,” “we,” “our” or “us” and other similar terms collectively means Major League Football, Inc., a Delaware corporation. Our principal offices are presently located at 7319 Riviera Cove #7, Lakewood Ranch, Florida, 34202. Our telephone number is (847) 924-4332. Our Internet website, currently under construction, will be located at: www.mlfb.com.

Going Concern

The accompanying unaudited financial statements have been prepared assuming the Company will continue as a going concern. As reflected in the accompanying unaudited financial statements, the Company had no revenues and net cash used in operating activities of $205,167 and $249 for the nine months ended January 31, 2019 and 2018, respectively. Additionally, at January 31, 2019, the Company has a working capital deficit of $3,467,792, an accumulated deficit of $27,035,920 and a stockholders' deficit of $3,467,292, which could have a material impact on the Company's financial condition and operations.

In view of these matters, recoverability of any asset amounts shown in the accompanying unaudited financial statements is dependent upon the Company’s ability to achieve a level of profitability. These matters raise substantial doubt about the Company’s ability to continue as a going concern for a period of one year from the date of the filing of the Company’s Form 10-Q with the Securities and Exchange Commission (“SEC”). Since inception, the Company has financed its activities from the sale of equity securities and from loans. The Company intends on financing its future development activities and its working capital needs largely from the sale of public equity securities and convertible debt securities, until such time that funds provided by operations, if ever, are sufficient to fund working capital requirements. Specifically, we will need to raise approximately $3 million between March and April 2019 and a subsequent raise and offerings of $20 million between April 2019 and July 2019, to cover our operating expenses for a full 2019 training camp and playing season in our designated cities. The unaudited financial statements do not include any adjustments relating to the recoverability or classification of recorded assets and liabilities that might result should the Company be unable to continue as a going concern.

MAJOR LEAGUE FOOTBALL, INC.

CONDENSED NOTES TO FINANCIAL STATEMENTS (UNAUDITED)

January 31, 2019

NOTE 1 – NATURE OF OPERATIONS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)

Basis of Presentation

The accompanying unaudited interim period financial statements of the Company are unaudited pursuant to certain rules and regulations of the SEC and include, in the opinion of management, all adjustments (consisting of only normal recurring accruals) necessary for a fair statement of the results of the periods indicated. Such results, however, are not necessarily indicative of results that may be expected for the full year. Certain information and footnote disclosures normally included in the financial statements prepared in accordance with accounting principles generally accepted in the United States have been condensed or omitted pursuant to such rules and regulations. The accompanying unaudited financial statements should be read in conjunction with the financial statements and notes thereto included in the Company's Annual Report on Form 10-K for the fiscal year ended April 30, 2018, as filed with the SEC on November 19, 2018. The interim operating results for the nine months ending January 31, 2019 are not necessarily indicative of operating results expected for the full year.

SIGNIFICANT ACCOUNTING POLICIES

Estimates

The preparation of financial statements in conformity with accounting principles generally accepted in the United States requires management to make estimates and assumptions that affect the amounts reported in the financial statements and accompanying disclosures. Although these estimates are based on management’s best knowledge of current events and actions the Company may undertake in the future, actual results could differ from the estimates.

Significant estimates in the accompanying financial statements include the valuation of derivative liabilities, valuation of equity-based instruments issued for other than cash and valuation allowance on deferred tax assets.

Cash and Cash Equivalents

For purposes of the statement of cash flows, the Company considers all highly liquid investments with an original maturity of three months or less when purchased to be cash equivalents. There were no cash equivalents at January 31, 2019 and April 30, 2018.

Concentrations

Concentration of Credit Risk

Certain financial instruments potentially subject the Company to concentrations of credit risk. These financial instruments consist primarily of cash. At January 31, 2019 and April 30, 2018, the Company did not have deposits with a financial institution that exceeded the FDIC deposit insurance coverage and determined that it had no cash equivalents.

MAJOR LEAGUE FOOTBALL, INC.

CONDENSED NOTES TO FINANCIAL STATEMENTS (UNAUDITED)

January 31, 2019

NOTE 1 – NATURE OF OPERATIONS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)

Convertible Promissory Notes and Related Embedded Derivatives

We account for the embedded conversion option contained in convertible instruments under the provisions of FASB ASC Topic No. 815-40, “Derivatives and Hedging – Contracts in an Entity’s Own Stock”. The embedded conversion option contained in the convertible instruments were accounted for as derivative liabilities at the date of issuance and shall be adjusted to fair value through earnings at each reporting date. The fair value of the embedded conversion option derivatives was determined using the Binomial Option Pricing model. On the initial measurement date, the fair value of the embedded conversion option derivative was recorded as a derivative liability and was allocated as debt discount up to the proceeds of the notes with the remainder charged to current period operations as initial derivative expense. Any gains and losses recorded from changes in the fair value of the liability for derivative contract was recorded as a component of other income (expense) in the accompanying unaudited statements of operations.

Fair Value of Financial Instruments

ASC 820, Fair Value Measurements and Disclosures, requires an entity to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value. ASC 820 establishes a fair value hierarchy based on the level of independent, objective evidence surrounding the inputs used to measure fair value. A financial instrument’s categorization within the fair value hierarchy is based upon the lowest level of input that is significant to the fair value measurement. ASC 820 prioritizes the inputs into three levels that may be used to measure fair value:

Level 1

Level 1 applies to assets or liabilities for which there are quoted prices in active markets for identical assets or liabilities.

Level 2

Level 2 applies to assets or liabilities for which there are inputs other than quoted prices that are observable for the asset or liability such as quoted prices for similar assets or liabilities in active markets; quoted prices for identical assets or liabilities in markets with insufficient volume or infrequent transactions (less active markets); or model-derived valuations in which significant inputs are observable or can be derived principally from, or corroborated by, observable market data. If the asset or liability has a specified (contractual) term, the Level 2 input must be observable for substantially the full term of the asset or liability.

Level 3

Level 3 applies to assets or liabilities for which there are unobservable inputs to the valuation methodology that are significant to the measurement of the fair value of the assets or liabilities.

The Company’s financial instruments consist principally of cash, accounts payable, unsecured convertible notes payable, secured convertible notes payable, notes payable, notes payable – related party and an embedded conversion option liability. Pursuant to ASC 820, Fair Value Measurements and Disclosures and ASC 825, Financial Instruments, the Company believes that the recorded values of the other financial instruments approximate their current fair values because of their nature and respective maturity dates or durations.

MAJOR LEAGUE FOOTBALL, INC.

CONDENSED NOTES TO FINANCIAL STATEMENTS (UNAUDITED)

January 31, 2019

NOTE 1 – NATURE OF OPERATIONS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)

Assets and liabilities measured at fair value on a recurring/non-recurring basis consist of the following at January 31, 2019:

The following is a summary of activity of Level 3 assets and liabilities for the nine months ended January 31, 2019:

Changes in fair value of the conversion option liability are included as a separate Other Income (Expense) item in the accompanying unaudited Statement of Operations.

Stock Subscription Receivable

The Company records stock issuances at the effective date. If the subscription is not funded upon issuance, the Company records a stock subscription receivable as a current asset on the balance sheet. When stock subscription receivables are not received prior to the issuance of financial statements at a reporting date in satisfaction of the requirements under ASC 505-10-45-2, the stock subscription receivable is reclassified as a contra account to stockholders’ equity (deficit) on the balance sheet.

League Tryout Camps

The Company recognizes league tryout camp revenue on the dates that the tryout camps were held. There were no tryout camps held by the Company during the nine months ended January 31, 2019 or 2018, respectively.

Football League Operations

The Company will recognize revenue from future football league operations including gate, parking and concessions, stadium advertising and merchandising, licensing fees, sponsorships, naming rights, broadcast and cable, franchise fees, social media and on-line digital media including merchandising, advertising and subscriptions. Since the football operations have not commenced, there was no revenue from football league operations during the nine months ended January 31, 2019 and 2018, respectively.

Stock Based Compensation

Stock-based compensation is accounted for based on the requirements of the Share-Based Payment Topic of ASC 718 which requires recognition in the financial statements of the cost of employee and director services received in exchange for an award of equity instruments over the period the employee or director is required to perform the services in exchange for the award (presumptively, the vesting period). The ASC requires measurement of the cost of employee and director services received in exchange for an award based on the grant-date fair value of the award.

MAJOR LEAGUE FOOTBALL, INC.

CONDENSED NOTES TO FINANCIAL STATEMENTS (UNAUDITED)

January 31, 2019

NOTE 1 – NATURE OF OPERATIONS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)

Pursuant to ASC 505-50, for share-based payments to consultants and other third-parties, compensation expense is determined at the “measurement date.” The expense is recognized over the service period of the award. Until the measurement date is reached, the total amount of compensation expense remains uncertain. The Company initially records compensation expense based on the fair value of the award at the reporting date.

Net Loss per Share of Common Stock

The Company computes net earnings (loss) per share in accordance with ASC 260-10, “Earnings per Share.” ASC 260-10 requires presentation of both basic and diluted earnings per share (“EPS”) on the face of the income statement. Basic EPS is computed by dividing net income (loss) available to common stockholders by the weighted average number of common shares outstanding during the period. Diluted EPS gives effect to all dilutive potential common shares outstanding during the period and the Company’s diluted EPS excludes all dilutive potential common shares because their effect is anti-dilutive. At January 31, 2019, there were options to purchase 1,240,000 shares of the Company’s common stock, 3,362,500 warrants to purchase shares of the Company's common stock, 166,667 shares of the Company’s common stock reserved for issuance related to convertible unsecured notes payable and 26,363,294 shares of the Company’s common stock reserved for issuance related to convertible secured notes payable which may dilute future earnings per share.

Related Parties

Parties are considered to be related to the Company if the parties, directly or indirectly, through one or more intermediaries, control, are controlled by, or are under common control with the Company. Related parties also include principal owners of the Company, its management, members of the immediate families of principal owners of the Company and its management and other parties with which the Company may deal with if one party controls or can significantly influence the management or operating policies of the other to an extent that one of the transacting parties might be prevented from fully pursuing its own separate interests. The Company discloses all related party transactions. All transactions are recorded at fair value of the goods or services exchanged.

NOTE 2 – DEBT

MAJOR LEAGUE FOOTBALL, INC.

CONDENSED NOTES TO FINANCIAL STATEMENTS (UNAUDITED)

January 31, 2019

NOTE 2 – DEBT (CONTINUED)

At January 31, 2019, the Company has previously recorded $230,000 of Notes Payable from seven third parties and the principal and interest are payable on demand. The interest rate for the Notes Payable is from 4% to 8% annually and during the nine months ended January 31, 2019, the Company recorded $11,038 of interest expense in the accompanying unaudited Statement of Operations and at January 31, 2019, the Company has accrued $41,885 of interest related to the Notes Payable as accrued interest in the accompanying unaudited Balance Sheet.

At January 31, 2019, the Company has previously recorded $2,300 of Notes Payable, Related Party from a former officer of the Company. There is no formal agreement and no interest is being accrued by the Company with the principal due on demand.

At January 31, 2019, the Company has previously recorded $50,000 of convertible unsecured notes payable. The terms include interest accrued at 5% annually and the principal and interest was payable in one year on April 14, 2017. The unsecured convertible promissory note is in default at January 31, 2019 and the note holder has several remedies including calling the principal amount and accrued interest due and payable immediately.

The note holder at its sole discretion, has the right to convert the principal amount, along with all accrued interest, into shares of the Company’s common stock at the conversion price of $0.30 per share. For the nine months ended January 31, 2019, the Company recorded $1,890 of interest expense in the accompanying unaudited Statement of Operations and at January 31, 2019, the Company has accrued $7,006 of interest related to the convertible unsecured note payable Notes Payable as accrued interest in the accompanying unaudited Balance Sheet.

MAJOR LEAGUE FOOTBALL, INC.

CONDENSED NOTES TO FINANCIAL STATEMENTS (UNAUDITED)

January 31, 2019

NOTE 2 – DEBT (CONTINUED)

Convertible Secured Note Payable - #1

At January 31, 2019, the Company has recorded a remaining balance of $85,000 from an original $550,000 face value convertible secured promissory note. From May 18, 2018 through January 10, 2019, the lender elected to convert $15,000 of the principal amount of the promissory note into 2,993,585 shares of common stock resulting in a note balance of $85,000 at January 31, 2019. See Note 3 – Stock.

The promissory note was due and payable on June 9, 2017 and as a result, is in default at January 31, 2019. However, the lender has not notified the Company of the default in writing but, the lender has several remedies including calling the principal amount and accrued interest due and payable immediately.

The promissory note includes customary affirmative and negative covenants of the Company was in default of a covenant to (1) be quoted or listed on at least one of the OTC Markets (OTCQX, OTCQB or OTC-Pink) or an equivalent replacement exchange, the Nasdaq National Market, the Nasdaq Small-Cap Market, the New York Stock Exchange, or the American Stock Exchange and (2) the Company shall be in compliance with (as “current”), or otherwise comply with the reporting requirements of the Exchange Act. On January 8, 2019, the Company received a waiver from the lender for these items through March 31, 2019 and is no longer in default of these specific items.

The Company is accruing interest at the default rate of twenty-two percent (22%) per annum, or the highest rate permitted by law, from the due date thereof until the same is paid. During the nine months ended January 31, 2019, the Company recorded $15,375 of interest expense in the accompanying unaudited Statement of Operations and at January 31, 2019, $85,832 of accrued interest was recorded in the accompanying unaudited Balance Sheet.

Convertible Secured Note Payable - #2

On May 17, 2018, the Company received $75,000 of net proceeds for working capital purposes from the issuance of a $80,000 face value convertible secured promissory note with debt issue costs paid to or on behalf of the lender of $5,000. The terms include interest accrued at 8% annually and the principal and interest payable are payable in one year on May 17, 2019. Any amount of the principal or interest which is not paid when due shall bear Interest at the rate of Eighteen Percent (18%), from the due date thereof until the same is paid.

MAJOR LEAGUE FOOTBALL, INC.

CONDENSED NOTES TO FINANCIAL STATEMENTS (UNAUDITED)

January 31, 2019

NOTE 2 – DEBT (CONTINUED)

The lender has the right at any time after the effective date, at its election, to convert all or part of the outstanding and unpaid principal sum and accrued interest into shares of common stock of the Company, subject to certain conversion limitations set forth in the promissory note and certain price protection described below, as per the conversion formula: Number of shares receivable upon conversion equals the dollar conversion amount divided by the Conversion Price. The Conversion Price is equal to Sixty Percent (60%) of the of the lowest trade of the Common Stock during the ten (10) trading Days immediately preceding a conversion date. The Conversion Price is subject to “full ratchet” and other customary anti-dilution protections.

The promissory note includes customary affirmative and negative covenants of the Company was in default of a covenant to (1) be quoted on or before July 17, 2018 or listed on at least one of the OTC Markets (OTCQX, OTCQB or OTC-Pink) or an equivalent replacement exchange, the Nasdaq National Market, the Nasdaq Small-Cap Market, the New York Stock Exchange, or the American Stock Exchange and (2) after July 17, 2018, the Company shall be in compliance with (as “current”), or otherwise comply with the reporting requirements of the Exchange Act. On January 8, 2019, the Company received a waiver from the lender for these items through March 31, 2019 and is no longer in default.

The Company evaluated the secured convertible promissory note in accordance with ASC 815 “Derivatives and Hedging” and due to the price protection in the promissory note, determined that there was a conversion option feature that should be bifurcated and accounted for as a conversion option liability in the balance sheet at fair value. The initial valuation and recording of the conversion option liability was $114,132, using the Binomial Lattice Option Pricing Model with the following assumptions; stock price $0.02, conversion price $0.012, expected term of 1 year, expected volatility of 263% and discount rate of 0.82%. The initial $114,132 conversion option liability assumed that 6,666,667 shares would be issued upon conversion of the promissory note.

On the note issue date of May 17, 2018, the Company recorded the following debt discounts as offsets to the $80,000 promissory note and will be amortized over the one-year term of the promissory note: (1) debt issue costs of $5,000 and (2) debt discount from conversion option liability of $75,000. As a result, the Company recorded $39,132 for the initial fair value of the conversion option liability in Other Income (Expense) in the accompanying unaudited Statement of Operations.

For the period from the note issue date of May 17, 2018 to January 31, 2019, the Company recorded $50,410 for amortization of the debt discounts discussed above and recorded to interest expense in the accompanying unaudited Statement of Operations.

The Company performed a revaluation of the conversion option liability using the Binomial Lattice Pricing Model at January 31, 2019 that resulted in a value of $293,700. As a result, the Company recorded $239,732 of a loss from the change in the fair value of conversion option liability, recorded in Other Income (Expense) in in the accompanying unaudited Statement of Operations for the three months ended January 31, 2019.

The revaluation of the conversion option liability at January 31, 2019 was calculated using the Binomial Lattice option pricing model with the following assumptions; stock price $0.02, conversion price $0.006, expected term of 0.24 years, expected volatility of 376% and discount rate of 2.36%. The change in the conversion option liability assumed that 17,777,778 shares would be issued upon conversion of the promissory note at January 31, 2019.

MAJOR LEAGUE FOOTBALL, INC.

CONDENSED NOTES TO FINANCIAL STATEMENTS (UNAUDITED)

January 31, 2019

NOTE 3 – STOCK

Common Stock:

The Company is authorized to issue up to 300,000,000 shares of common stock at $0.001 par value per share. Effective February 15, 2019, the Company amended its Articles of Incorporation to increase authorized shares of common stock from 200,000,000 to 300,000,000. Effective August 23, 2018, the Company amended its Articles of Incorporation such that all 200,000,000 shares shall be designated as common stock and the prior authorized designated 50,000,000 shares of convertible preferred stock, par value $0.001 per share were converted to common stock. As a result, the Company has no authorized preferred stock. At January 31, 2019, 87,993,073 shares were issued, issuable and outstanding. Additionally, there are 1,500,000 shares of stock issued to former officers that were terminated prior to the vesting period of four years through July 14, 2018 and excluded from the shares issued and outstanding at January 31, 2019. In accordance with their employment agreements, if the Employee’s employment is terminated by Employee or the Company, any shares not yet released to Employee upon the termination date shall be returned to the treasury of the Company, and Employee shall be entitled to no compensation for such shares. The Company plans to pursue the return of the 1,500,000 unvested shares held by the employees to be returned to treasury.

Common Stock Issued

On July 18, 2018, the lender of a convertible secured promissory, elected to exercise their right to convert $10,000 of the remaining $100,000 convertible secured promissory note at April 30, 2018 (See Note 2 – Debt). The lender has the right at any time after the effective date, at its election, to convert all or part of the outstanding and unpaid principal sum and accrued interest into shares of common stock of the Company, subject to certain conversion limitations set forth in the promissory note and certain price protection described below, as per the conversion formula: Number of shares receivable upon conversion equals the dollar conversion amount divided by the Conversion Price. The Conversion Price is equal to 70% of the average of the lowest three VWAPs of the Common Stock during the twenty (20) Trading Days immediately preceding a Conversion Date. Based upon a Conversion Price of $0.02 per share on the conversion date, the Company issued 819,672 shares of common stock to the lender.

On June 8, 2018, the Company received $10,000 of proceeds from a private placement offering, representing 1,000,000 shares of stock at a sales price of $0.01 per share from a related party investor. See Note 5 Related Party Transactions.

On October 5, 2018, the Company received $50,000 of proceeds from a private placement offering, representing 5,000,000 shares of stock at a sales price of $0.01 per share.

On December 7, 2018, the Company received $50,000 of proceeds from a private placement offering, representing 5,000,000 shares of stock at a sales price of $0.01 per share from a related party investor. See Note 5 – Related Party Transactions.

On January 11, 2019, the lender of a convertible secured promissory, elected to exercise their right to convert $5,000 of the remaining $90,000 convertible secured promissory note (See Note 2 – Debt). The lender has the right at any time after the effective date, at its election, to convert all or part of the outstanding and unpaid principal sum and accrued interest into shares of common stock of the Company, subject to certain conversion limitations set forth in the promissory note and certain price protection described below, as per the conversion formula: Number of shares receivable upon conversion equals the dollar conversion amount divided by the Conversion Price. The Conversion Price is equal to 70% of the average of the lowest three VWAPs of the Common Stock during the twenty (20) Trading Days immediately preceding a Conversion Date. Based upon a Conversion Price of $0.002 per share on the conversion date, the Company issued 2,173,913 shares of common stock to the lender. 

MAJOR LEAGUE FOOTBALL, INC.

CONDENSED NOTES TO FINANCIAL STATEMENTS (UNAUDITED)

January 31, 2019

NOTE 3 – STOCK (Continued)

Common Stock Issuable

On January 30, 2019, the Company and an investor executed a subscription agreement from a private placement offering for the sale of 16,000,000 shares of stock at a purchase price of $0.0125 per share or a total of $200,000. On January 30, 2019, the Company received $30,000 of proceeds from the offering representing 2,400,000 shares of stock. The remaining $170,000 of proceeds were received by the Company on February 6, 2019 (See Note 7 – Subsequent Events) and because they were received before the issuance of these unaudited financial statements, the Company recorded the $170,000 as a subscription receivable in the accompany unaudited balance sheet at January 31, 2019. The 16,000,000 shares of stock are recorded by the Company as Common Stock Issuable in the accompanying unaudited Balance Sheet at January 31, 2019. See Note 5 – Related Party Transactions.

NOTE 4 – STOCK BASED COMPENSATION

Stock Options to Consultants

Effective July 14, 2014, the Company granted 4,150,000 stock options to purchase common stock to consultants pursuant to the 2014 Plan and shall vest pursuant to the vesting provision contained in each of the stock option agreements. The exercise price of the stock options is $0.05 per share. At April 30, 2018, only 1,200,000 of these options were outstanding and were held by the Senior Executive Vice President of the Company as the other stock options were either forfeited or terminated since being granted. For the 1,200,000 stock options held by the Senior Vice President of the Company, 450,000 vested on the grant date of July 14, 2014 and the remaining 750,000 had a four (4) year vesting period through July 14, 2018.

The 750,000 unvested stock options held by the Senior Executive Vice President of the Company were re-measured for the final time at July 14, 2018 (fully vested) and the Company recorded $3,865 as a credit to consulting expense during the nine months ended January 31, 2019 in the accompanying unaudited Statement of Operations.

The Company used the following assumptions in estimating fair value:

MAJOR LEAGUE FOOTBALL, INC.

CONDENSED NOTES TO FINANCIAL STATEMENTS (UNAUDITED)

January 31, 2019

NOTE 4 – STOCK BASED COMPENSATION (Continued)

The following table summarizes employee and consultant stock option activity of the Company for the nine months ended January 31, 2019:

In August 2018 and January 2019, 1,800,000 and 370,000 warrants, respectively, expired as they were not exercised before the end of the exercise period.

The following table summarizes stock warrant activity of the Company for the nine months ended January 31, 2019:

NOTE 5 – RELATED PARTY TRANSACTIONS

The Company has previously accrued $740,000 for unpaid former officer compensation and accrued $37,111 for the employers share of payroll taxes related to the unpaid former officer compensation in the accompanying unaudited Balance Sheet. The accrued compensation is related to two former officers and the Company believes that because of the termination of all officers, there is no employment agreement or compensation due to the former officers.

MAJOR LEAGUE FOOTBALL, INC.

CONDENSED NOTES TO FINANCIAL STATEMENTS (UNAUDITED)

January 31, 2019

NOTE 5 – RELATED PARTY TRANSACTIONS (Continued)

At January 31, 2019, the Company has a $2,300 remaining unpaid balance on a promissory note due to a former officer that originally was $15,300 for working capital requirements.

There is no formal agreement and no interest is being accrued by the Company with the principal due on demand. The Company classified the promissory note as Notes Payable – Related Parties in the accompanying unaudited Balance Sheet. See Note 2 – Debt.

At January 31, 2019, the Company has recorded $73,775 of accounts payable – related parties for Company related expenses. This includes $52,448 paid by the Senior Executive Vice President on behalf of the Company, $18,258 paid by the Director of Services and Procurement on behalf of the Company, $1,815 paid by the Company’s former authorized house counsel on behalf of the Company and $125 paid by a former officer of the Company on behalf of the Company. The $52,448 owed to the Senior Vice President of the Company includes a reduction of $10,000 on December 10, 2017 from the exercise of 1,000,000 stock warrants at an exercise price of $0.01 per share. The $10,000 exercise price was paid by electing to reduce the balance due under expenses owed by the Company.

Between June 8, 2019 and January 30, 2019, an investor purchased 21,000,000 shares of the Company’s $0.001 par value common stock at a purchase price of between $0.01 and $0.0125 per share – See Note 3 - Stock. At January 31, 2019, the 21,000,000 shares represented approximately 29% of the Company’s issued shares of common stock and as a result, is deemed to be a related party. See Note 7 – Subsequent Events.

NOTE 6 – COMMITMENTS AND CONTINGENCIES

Office Lease

On August 28, 2017, the Company was served with a Motion for Final Judgment related to a lease agreement for its corporate headquarters and training facility in Lakewood Ranch, Manatee County, Florida. The Landlord filed a Motion for Summary Judgment for back rent, attorney’s fees and foreclosure of a Landlord’s Lien. The Company responded, and the court granted the Motion as to liability for back rent without assessing an amount and denied the remainder of the Motion. As second Motion for Summary Judgment was filed as to the remaining issues. While pending, the parties reached a settlement on February 5, 2018. The terms of the settlement agreement included:

From May 31, 2018 through February 28, 2019, the landlord and the Company executed nine amendments to the February 5, 2018 settlement discussed above which specified:

As a result of the ninth amendment dated February 28, 2019, the Company was allowed to remove certain football equipment and uniforms but not all equipment. If the Company fails to make the $12,000 payment on March 31, 2019, the Company unconditionally and irrevocably transfers all right, title and interest in and to the remaining football equipment in landlord’s possession and landlord may immediately dispose of same as it chooses.

 MAJOR LEAGUE FOOTBALL, INC.

CONDENSED NOTES TO FINANCIAL STATEMENTS (UNAUDITED)

January 31, 2019

NOTE 6 – COMMITMENTS AND CONTINGENCIES (Continued)

Lawsuit for Legal Fees

On May 9, 2009, Stradley Ronon Stevens & Young, LLP, filed a lawsuit against the Company in the U.S. District Court for the District of Delaware for failure of the Company to pay legal fees owed in the amount of $166,129. The Company negotiated with Stradley and in July 2014, issued Stradley 100,000 shares of common stock valued at $0.05 per share, the quoted market price on the date of grant, as a sign of good faith towards a resolution. On April 2, 2009, to avoid the cost of litigation, the Company agreed to a Consent of Judgment against it in the amount of $166,129 and the Company continues to carry this amount as accounts payable in the accompanying unaudited Balance Sheet at January 31, 2019. The Company is still in discussions with the law firm related to this Judgment and anticipates a resolution in the future.

Attorney Lien

On August 2, 2017, David Bovi, the Company’s former legal counsel, submitted correspondence reflecting a “charging lien” for non-payment relate to $243,034 of legal services provided to the Company. The amount included interest on unpaid invoices. The “retaining lien” states that Mr. Bovi will retain all documents in his possession unless paid the amount outstanding as described above.

H&J Ventures, LLC (“H&J”) is a debtor in a chapter 7 bankruptcy proceeding. On October 4, 2016, the chapter 7 trustee (the “Trustee”) of the bankruptcy estate of H&J sent a letter to the Company claiming that the Company owed $7,800,000 to H&J relating to an October 1, 2014 agreement between the Company and H&J, and that the Trustee would accept a settlement payment of $6,630,000 to resolve the matter. The Company disputes this claim in its entirety. On December 9, 2016, the Trustee served the Company with a subpoena relating to this matter. The Company has retained counsel with respect to this matter and will respond to the subpoena as it is lawfully required to do; however, the Company considers this claim to be without merit. The Company engaged a law firm to assist in the matter and on January 23, 2017, paid a $7,500 retainer, which continues to be classified as prepaid legal fees in the accompanying unaudited Balance Sheet at January 31, 2019.

On August 24, 2017, the Company and H&J agreed to a $50,000 settlement payment by the Company to the bankruptcy trustee to resolve the matter. The settlement required the Company to make the payment by September 7, 2017 and failure to pay as per the terms of the settlement would probably result in sanctions of some type, and result in the settlement being set aside, to allow the trustee to pursue the full range of damages. It was represented at the mediation that an expert for the Trustee would opine that services rendered by H&J under the contract had a current value of the approximate sum of $2,000,000.

The former CEO of the Company at that time, submitted the required $50,000 payment in a timely fashion to the trustee. However, on September 15, 2017, the trustee notified the Company that the payment made was returned for insufficient funds. The former CEO was given an opportunity by the trustee to rectify the issue with a valid payment on or before September 18, 2017, which payment did not occur. The trustee was willing to accept a $50,000 payment by the Company to settle the matter but is under no obligation to accept such payment and the trustee may pursue the full range of damages against Company.

MAJOR LEAGUE FOOTBALL, INC.

CONDENSED NOTES TO FINANCIAL STATEMENTS (UNAUDITED)

January 31, 2019

NOTE 6 – COMMITMENTS AND CONTINGENCIES (Continued)

On May 16, 2018, the Court conducted a scheduling conference in which the Court granted leave to the Trustee to amend the pleadings to assert the bad check claims in the first lawsuit. The Court also gave the parties 90 days to conduct discovery. As of the date of this report, the Trustee has yet to file an amended pleading. A trial date was set for October 3, 2018.

On August 13, 2018, the Company and the Trustee executed a Stipulation and Consent Order specifying that the Company would pay the Trustee $50,000 by August 31, 2018. If payment was not made timely by the Company and was not cured within three (3) days of the August 31, 2018 date, a consent judgment in the amount of $70,000 would be entered against the Company. The Company did not make the required payment within the timeframe and as a result, a judgment in the amount of $70,000 was entered against the Company. The Company recorded accrued expenses of $70,000 for the potential settlement in the accompanying unaudited Balance Sheet at January 31, 2019.

Interactive Liquid LLC:

On August 4, 2017, Interactive Liquid LLC (Interactive”), a vendor of the Company, filed a lawsuit in the amount of $153,016 related to unpaid invoices for logo design and website development services provided. On December 18, 2017, MLFB received a settlement demand for payment of consideration with a total value of $153,016, consisting of stock valued at $26,016 and periodic cash payments to be completed on or before June 1, 2018 totaling $127,000. Further negotiations ensued and ultimately the case was settled on or about March 5, 2018. The settlement called for MLFB to make payment to Interactive in the sum of $10,000 immediately upon receipt of an initial tranche of funding. MLFB was then required to make an additional payment of $30,000 on or before June 1, 2018. MLFB’s failure to make the payments as outlined would result in the entry of a judgment in favor of Interactive against MLFB in the sum of $153,016, said sum representing the full amount of Interactive’s claimed damages. The Company has recorded accounts payable to Interactive of $153,016 in the accompanying unaudited Balance Sheet at January 31, 2019. The Company failed to make the required payment due to lack of funding and as such, on June 4, 2018, Interactive filed the stipulated judgment.

Lamnia International:

The Company previously entered into a contract with Lamnia International (“Lamnia”) for investor relations services. On December 7, 2017, the Company received a demand for payment in the sum of $153,000. Per the demand letter, the sum was to be paid on or before December 15, 2017 and if not paid, collections and or legal actions could be instituted. The Company has recorded accounts payable to Lamnia of $124,968 in the accompanying unaudited Balance Sheet at January 31, 2019. The difference in amounts is because the Company terminated the agreement in writing to the vendor whereas the vendor continued to charge for services after the date of termination for which the Company disagrees.

Herm Edwards:

The Company retained Herm Edwards, a former NFL player and coach, as a consultant to promote the new football league. On September 19, 2017, Mr. Edwards agent contacted the Company and indicated that under the contract, Mr. Edwards was still owed the sum of $216,668. The Company has recorded accounts payable to Mr. Edwards of $191,667 in the accompanying Unaudited Balance Sheet at January 31, 2019. The amount recorded by the Company is $25,000 less than the claim because services were terminated by both parties prior to amounts invoiced which the Company disputes.

MAJOR LEAGUE FOOTBALL, INC.

CONDENSED NOTES TO FINANCIAL STATEMENTS (UNAUDITED)

January 31, 2019

NOTE 6 – COMMITMENTS AND CONTINGENCIES (Continued)

Unpaid Taxes and Penalties

At January 31, 2019, the Company owed the State of Delaware $110,154 for unpaid state income taxes from the tax year ended April 30, 2007. The unpaid state income taxes are included as state income taxes payable in accompanying unaudited Balance Sheet at January 31, 2019. Additionally, the Company owes the State of Delaware for penalties and interest from the tax year ending April 30, 2007 of $214,318, which is included as accrued expenses in the accompanying unaudited Balance Sheet at January 31, 2019. The Company has an agreement with the State of Delaware to pay a minimum per month. However, due to cash flow constraints, the Company has been unable to pay the minimum monthly amounts and is in default of the agreement that may cause additional interest and penalties and lead to other collection efforts by the State of Delaware.

In September 2015, the Company reached an offer in compromise (“OIC”) settlement with the IRS for unpaid penalties and interest from the tax year ended April 30, 2007. The settlement was in the amount of $13,785 and was to be paid by the Company with a $1,000 payment upon the execution of settlement, then the balance of $1,757 paid in November 2015 and making up the 20% down payment of $2,757, a second installment payment of $2,208, and then four monthly payments of $2,205. The Company made all required payments in accordance with the settlement except for the final payment of $2,205.

The Company received correspondence from the IRS that because of an application fee note being paid with the original OIC, the Company was required to submit a new OIC and the required application fee. In October 2016, the Company had a telephone call with an IRS representative and were informed to offer the last payment that was due on the original OIC of $2,205 as discussed above and pay 20% of that balance. On October 5, 2016, the Company sent to the IRS by certified mail two checks in the amount of $186 (application fee for the new OIC) and $449 (20% or $441 of the $2,205 remaining original OIC payment and an $8 processing fee). The Company applied $441 against the remaining payment owed and the balance of $1,764 is included in accrued expenses in the accompanying unaudited Balance Sheet at January 31, 2019. As of the date of these financial statements, the Company has not received any further correspondence form the IRS and the Company is considered in default of the settlement agreement and the IRS could void or restructure the agreement.

Stock Delisting

On September 14, 2017, the OTC Markets Group notified the Company of its delisting from the OTCQB due to its delinquency in filings, specifically with the SEC.

SEC Correspondence

On April 19, 2018, the Company received correspondence from the SEC Division of Corporate Finance related to non-compliance with the reporting requirements under Section 13(a) of the Securities Act of 1934. The Company responded to the SEC on April 30, 2018 providing information that its past due April 30, 2017 Form 10-K was filed on April 25, 2018 and that it was actively preparing past due 10-Q filings for the periods ended July 31, 2017, October 31, 2017 and January 31, 2018. The Company requested a sixty (60) day extension to file the past due 10-Q reports. The Company filed the past due 10-Q reports with the SEC on June 11, 2018.

MAJOR LEAGUE FOOTBALL, INC.

CONDENSED NOTES TO FINANCIAL STATEMENTS (UNAUDITED)

January 31, 2019

NOTE 6 – COMMITMENTS AND CONTINGENCIES (Continued)

The Company filed its Form 10-K and the financial statements for the year ended April 30, 2018 on November 19, 2018 but, were not timely filed. As the Company had not timely filed its Form 10-K for the year ended April 30, 2018, the Company may be subject, without further notice, to an administrative proceeding to revoke its registration under the Securities Act of 1934. Additionally, the Company had not timely filed its Form 10-Q for the three months ended July 31, 2018 and October 31, 2018. As of the date of these unaudited financial statements for the three months ended January 31, 2019, the Company has received no further correspondence from the SEC.

Business Agreement

Effective November 16, 2018, the Company entered into a Master Business Agreement (“Master Agreement”) with a third-party consulting firm to provide the following services related to the Company’s planned 2019 football season: (1) marketing and communications, (2) sponsorship development and sales, (3) distribution and broadcasts and (4) production and show creation. The Master Agreement has a term of one year through November 16, 2019 and provides for both cash and common stock payments for each of the above four service areas. The services to be provided are contingent on the Company obtaining a minimum $3,000,000 of investor funding which had not occurred as of the date of these unaudited financial statements. On January 30, 2019, the Company paid the consultant $20,000 as a good faith payment and the Company has recorded the payment as prepaid consulting in the accompanying unaudited balance sheet at January 31, 2019. See Note 7 – Subsequent Events.

NOTE 7 – SUBSEQUENT EVENTS

Effective February 5, 2019, the Company entered into a Master Services Agreement (“Master Services”) with a third-party consulting firm to provide social and digital consulting for the Company. The Master Services included an initial Statement of Work (“SOW”) in the amount of $167,500 for services through October 31, 20-19. The SOW provided for an initial signing payment of $25,000 upon the execution of the SOW and $15,000 payments to be made through October 31, 2019. The Company made the $25,000 signing payment on February 21, 2019 and will be recorded as consulting expense in the Statement of Operations.

On January 30, 2019, the Company executed a subscription agreement with the related party investor for the sale of 16,000,000 shares of stock for a total of $200,000, with an initial $30,000 of proceeds received by the Company on the same date.  On February 6, 2019, the Company received $170,000 of proceeds from this private placement offering, representing 13,600,000 shares of stock at a sales price of $0.0125 per share to a related party investor. See below discussion, Note 3 – Stock and Note 5 Related Party Transactions.

On February 7, 2019, the Company paid an additional $30,000 to the Consultant under the Master Agreement discussed in Note 6 – Commitments and Contingencies.

On March 6, 2019, the Company received $100,000 of proceeds from a private placement offering, representing 5,000,000 shares of stock at a sales price of $0.02 per share to a related party investor. As of the date of these unaudited financial statements, the related party investor owns 26,000,000 shares of the Company’s $0.001 par value common stock representing approximately 28% of the Company’s issued shares of common stock. See above discussion and Note 5 – Related Party Transactions.

On March 9, 2019, the Company held a Pro Day tryout in Ventura, California for the anticipated April 2019 football season launch. Additionally, the Company has Pro Day tryouts scheduled in other cities for each of the weekends from March 16, 2019 through March 30, 2019.

Effective March 12, 2019, the Company entered into a lease agreement to rent the War Memorial Stadium in Little Rock, Arkansas for a minimum of four and a maximum of five football games for the 2019 football season. The payment for each event is $10,000 plus additional expenses including security and expenses for a total of $14,225 per event. Additionally, the Company paid a $5,000 non-refundable deposit with the execution of the lease agreement.

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

Introduction

The following discussion contains forward-looking statements. The words “anticipate,” “believe,” “expect,” “plan,” “intend,” “estimate,” “project,” “will,” “could,” “may” and similar expressions are intended to identify forward-looking statements. Such statements reflect our Company's current views with respect to future events and financial performance and involve risks and uncertainties. Should one or more risks or uncertainties occur, or should underlying assumptions prove incorrect, actual results may vary materially and adversely from those anticipated, believed, expected, planned, intended, estimated, projected or otherwise indicated. Readers should not place undue reliance on these forward-looking statements.

The following discussion is qualified by reference to, and should be read in conjunction with our Company's financial statements and the notes thereto.

Financial Condition

As reflected in the accompanying unaudited financial statements, the Company had no revenues, a net loss of $484,967 and net cash used in operating activities of $205,167 for the nine months ended January 31, 2019. Additionally, at January 31, 2019, the Company has a working capital deficit of $3,467,792, an accumulated deficit of $27,035,920 and a stockholders' deficit of $3,467,292, which could have a material impact on the Company's financial condition and operations.

Results of Operations

Three months ending January 31, 2019, compared to the three months ended January 31, 2018

For the three months ended January 31, 2019 and 2018, we had no revenue. The Company is working through its business plan whereby it is seeking to establish, develop and operate MLFB as a professional spring football league with an anticipated launch with an anticipated launch date in a full season with training camp in March of 2019 with a regular eight team season commencing in late April of 2019 with playoffs and a championship game in July of 2019.

Total operating expenses for the three months ended January 31, 2019 were $95,662 as compared to total operating expenses for the three months ended January 31, 2018 of $27,380 or a change of $68,282. The increase in expense from 2018 to 2019 was primarily from a $65,176 increase in professional fees, primarily from an increase in accounting and consulting fees from 2018 to 2019.

Other income (expense) for the three months ended January 31, 2019 was $276,628 of expense compared to $11,371 of expense for the three months ended January 31, 2018 or a change of $265,267. The increase in expense from 2018 to 2019 was primarily from $239,732 of a loss from the change in fair value of a conversion option liability in 2019 with no comparable amount in 2018. Additionally, there was a $25,245 increase in interest expense, primarily from the amortization of debt discounts related to a secured promissory note.

Because of the above, we had a net loss of $372,290 as compared to a net loss of $38,751 for the three months ended January 31, 2019 and 2018.

Nine months ending January 31, 2019, compared to the nine months ended January 31, 2018

For the nine months ended January 31, 2019 and 2018, we had no revenue. The Company is working through its business plan whereby it is seeking to establish, develop and operate MLFB as a professional spring football league with an anticipated launch with an anticipated launch date in a full season with training camp in March of 2019 with a regular eight team season commencing in late April of 2019 with playoffs and a championship game in July of 2019.

Total operating expenses for the nine months ended January 31, 2019 were $168,754 as compared to total operating expenses for the nine months ended January 31, 2018 of $234,092, or a decrease of $65,338. The decrease in expense from 2018 to 2019 was primarily from a $29,953 decrease in professional fees, primarily from a decrease in legal and accounting fees from 2018 to 2019. Additionally, the decrease from 2018 to 2019 was from a $34,485 decrease in general and administrative expense, primarily because the Company significantly reduced expenditures due to lack of cash availability.

Other income (expense) for the nine months ended January 31, 2019 was $316,213 of expense compared to $30,841 of expense for the nine months ended January 31, 2018 or a change of $285,372. The increase in other expense from 2018 to 2019 was primarily from an initial fair value of conversion option liability of $39,132 and from $179,568 of a loss from the change in fair value of a conversion option liability in 2019 with no comparable amount in 2018. Additionally, the increase from 2018 to 2019 was offset from a $34,980 decrease in other income from a prior year adjustment of accounts payable in 2018 with no comparable amount in 2019. Additionally, there was an $33,358 increase in interest expense primarily related to amortization of debt discounts related to a secured promissory note.

Because of the above, we had a net loss of $484,967 as compared to a net loss of $264,933 for the nine months ended January 31, 2018.

Liquidity and Capital Resources

From inception, our Company has relied upon the infusion of capital through equity transactions and the issuance of debt to obtain liquidity. We had $9,858 of cash at January 31, 2019. Consequently, payment of operating expenses will have to come similarly from either equity capital to be raised from investors or from borrowed funds. There is no assurance that we will be successful in raising such additional equity capital or additional borrowings or if we can, that we can do so at a cost that management believes to be appropriate.

Critical Accounting Policies

Our Company’s accounting policies are more fully described in Note 1 of Notes to Financial Statements. As disclosed in Note 1 of Notes to Financial Statements, the preparation of financial statements in conformity with accounting principles generally accepted in the United States requires management to make estimates and assumptions that affect the amounts reported in the financial statements and accompanying disclosures. Although these estimates are based on our management’s best knowledge of current events and actions our Company may undertake in the future, actual results could differ from the estimates.

Item 4. Controls and Procedures. 

Evaluation of Disclosure Controls and Procedures

As of the end of the period covered by this report, our Company evaluated the effectiveness and design and operation of its disclosure controls and procedures. Our Company's disclosure controls and procedures are the controls and other procedures that we designed to ensure that our Company records, processes, summarizes, and reports in a timely manner the information that it must disclose in reports that our Company files with or submits to the Securities and Exchange Commission. Our management, including our principal executive officer and principal financial officer, evaluated the effectiveness of the design and operation of our disclosure controls and procedures as of January 31, 2019 and concluded that the disclosure controls and procedures were not effective, because certain deficiencies involving internal controls over financial reporting constituted a material weakness as discussed below.

To mitigate the above weaknesses(s), to the fullest extent possible, our Company has engaged a financial consultant with significant accounting and reporting experience to assist in becoming and remaining current with its reporting responsibilities. Additionally, as soon as our finances allow, we will hire sufficient accounting staff and implement appropriate procedures to mitigate the weaknesses discussed above. Additionally, the Company plans on hiring a fulltime Controller or Chief Financial Officer when funds are sufficient.

  Changes in Internal Control Over Financial Reporting.

No change in our Company's internal control over financial reporting occurred during our fourth fiscal quarter that has materially affected, or is reasonably likely to materially affect, our internal control over financial reporting.

Plan of Operation

Major League Football, Inc. (the “Company”) is seeking to establish, develop and operate Major League Football ("MLFB") as a professional spring/summer football league. We intend to fill a void by establishing franchises in cities overlooked by existing professional sports leagues and provide fans with professional football in the NFL off-seasons, which will enable it to take a totally non-adversarial approach towards the National Football League ("NFL"). Our spring and early summer schedule ensures no direct competition with autumn/winter sports, including the 32 NFL, 9 Canadian Football League, 627 NCAA, 91 NAIA, 142 JUCO's, 27 Canadian Universities, and thousands of high school and collegiate institution teams.

During Spring 2017, the Company determined to reschedule its inaugural year of professional, spring-league football from Spring 2017 to Spring 2018 but was again delayed due to a continued lack of adequate funding. The Company now intends to launch a full season of professional, spring-league football during 2019.

We expect we will need additional short-term financing as well as financing over the next 12 months in order to position our Company for its anticipated launch of a training camp in March 2019 with a regular eight team season commencing in May of 2019 with playoffs and a championship game in July of 2019. Specifically, we will need to raise approximately $3 million between March and April 2019 and a subsequent raise and offerings of $20 million between April 2019 and July 2019, to cover our operating expenses for a full 2019 training camp and playing season in our designated cities.

Single Entity Structure

We intend to operate the league as a single entity owned, stand alone, dominant independent sports league. The single entity structure will be based on the design of Major League Soccer (MLS), where a single entity sports league owns and operates all of its teams. This corporate structure provides several compelling benefits, including:



Management believes that this structure will also promote efficiency by depoliticizing decisions on league policies and allowing decisions to be made with consistency and in a timely fashion. Economies of scale will be achieved through centralizing contract negotiations and handling business affairs in the league office to ensure that individual teams are unified in their decision-making. Further, under this structure, we expect teams will operate in the best interest of the league.

MLFB Market Opportunity

Major League Football intends to establish a brand that is fan-friendly, exciting, affordable and interactive, but most importantly provides consumers real value for their sports dollars. MLFB will underscore the fans’ access to team members, coaches, league officials and other fans, something no other existing or previous football league has ever delivered to its viewing audience. Although Major League Football’s ticket pricing will be a fraction to that of the established professional leagues (NBA, MLB, NHL and NFL), its ultimate goal will be to offer its fans an incomparable value-added experience for their entertainment dollar.

Additionally, as a result of a carefully crafted study, we will not locate teams in any established NFL cities and more importantly in any Major League Baseball cities, thus avoiding direct in-season competition with an established sports entity. By positioning teams in prime emerging and under-represented markets throughout the contiguous 48 states (including placing teams in well respected and football fan friendly metropolitan markets in the country), our research suggests that an exciting sports entity like Major League Football will be viewed in a positive light by sports fans throughout the US, many of whom are already experiencing post Super Bowl withdrawal. Of equal or greater importance to Major League Football is the fact that both established and peripheral football fans in these exciting new markets will finally be afforded the opportunity of establishing their own personal sports identity while at the same time fostering strong community pride. Lastly, although Major League Football’s long-range vision is to maintain a positive working relationship with the NFL, its ultimate intent is to function as an independent, stand-alone entity that captures sports content needed during off season.

Major League Football intends to disseminate its message using a comprehensive marketing strategy that employs both traditional and new media marketing channels. MLFB’s marketing plans are anticipated to create multiple revenue streams and engage sports fans over a variety of mediums, many of which have only emerged during the past few years. Specifically, Major League Football intends to develop a far-reaching Internet and mobile strategy that will serve as the backbone of its marketing strategy. This will include developing a mobile initiative, where fans can interact with the league, its players, its coaches, and other fans using their mobile phones all while taking advantage of the player name recognition that comes with fantasy football.

Major League Football also intends to create an interactive website that includes a social networking aspect, podcasts, live video, and more. Along with this new media strategy, cross promotions will also be an important part of the MLFB’s marketing strategy. Major League Football plans to work with businesses involved in video, television, print media and the Internet to promote its business. We believe that the cumulative effect of this marketing plan will help it achieve its early objectives, which include the following:

Professional Sports Market

Major League Football recognizes the NFL is the dominant professional sports league in the United States. Although it clearly respects the success of the NFL business model, its defined objective is to position itself as an independent, non-adversarial football league. Major League Football believes that its own business model encompasses innovations that will be viewed positively by NFL officials, resulting in a strong working relationship between the two leagues. Additionally, new leagues that will provide competition to Major League Football have been recently formed including the Alliance of American Football (AAF) that has recently commenced football games and the XFL, which is set to commence games in 2020. Major League Football believes that its target markets are different from both the AAF and XFL and that its economic model requires significantly less cash and is sustainable, while nonetheless able to provide a reasonable return for its shareholders.

Major League Football will endeavor to maximize ticket vendor technology and enhance its services to patrons with innovative ticketing procedures that include:

Initially, Major League Football teams will operate in either existing collegiate or municipal stadiums during the spring and early summer season,

We believe that our business model and long-range vision possesses many innovations that will be viewed in a positive light by NFL owners and league officials, and will also lend itself to the potential of establishing a strong working relationship with our venture by positioning ourselves in a 100% non-adversarial position to the established NFL.

Audience

Major League Football believes that today’s market demands a controlled deliverable to a targeted demographic viewing audience as well as controlled advertising deliverables to specific targeted demographic audiences as well. Other sports attract audiences that are only a fraction of that number, in producing the sponsor and advertiser concerns. Therefore, retaining the mass appeal needed to attract such an audience is an over-arching consideration that shapes much of what we do and what concerns the Company.

Merchandising & Licensing Overview

The thrust of our licensing and co-branding strategy is to create an increase in brand value for MLFB and the partners we align with. In order for the league to have a robust licensing and co-branding business, we have created a 3-tier approach that focuses on generating strong revenue streams for the league and initiating value based collaborative efforts that further enhance the MLFB brand.

The main benefits of the program are:

We also intend to develop private label products where we will feature products that are core fan favorites (hats, shirts, popular novelties and gifts, etc.) all manufactured at the highest level, and priced far below traditional licensed sports merchandise programs. All merchandise, when league sanctioned, will be pre-ticketed and priced.

Timeline of Significant Events

On or about March 5, 2018 the parties in the Interactive Liquid, LLC v. Major League Football, Inc litigation reached a settlement. The settlement called for MLFB to make payment to the Plaintiff in the sum of $10,000 immediately upon receipt of an initial tranche of funding. MLFB must then make an additional payment of $30,000 on or before June 1, 2018. MLFB’s failure to make the payments as outlined will result in the entry of a judgment in favor of the plaintiff and against MLFB in the sum of $153,016 (less payment of $10,000 if made before June 1, 2018), said sum representing the full amount of Plaintiff’s claimed damages.

On May 9, 2018, the Court in the John M. McDonnell, as Chapter 7 Trustee for the Estate of H&J Ventures, LLC v. Major League Football and Jerry C. Craig case denied the Trustee’s Motion for Default Judgment against Jerry C. Craig and dismissed the second lawsuit against both Craig and the Company. As to Craig, the Court found that since he signed the check in a clearly designated representative capacity for the Company, he had no personal liability. As to the Company, the Court found that the first lawsuit was still ongoing and that any claims for the bad check should be brought by amending the first lawsuit to make the claims rather than in a second lawsuit.

On May 16, 2018, the Court in John M. McDonnell, as Chapter 7 Trustee for the Estate of H&J Ventures, LLC v. Major League Football, conducted a scheduling conference in which the Court granted leave to the Trustee to amend the pleadings to assert the bad check claims in the first lawsuit. The Court also gave the parties 90 days to conduct discovery. As of the date of this report, the Trustee has yet to file an amended pleading.

On May 17, 2018, the Company and SBI Investments LLC, 2014-1 entered into a Securities Purchase Agreement and Convertible Promissory Note in the principal sum of $80,000. The agreement provides, inter alia, that the principal and interest are to be paid in full on or before May 17, 2019 with interest at the rate of 8% per annum. Effective November 17, 2018, SBI has the right to convert any or all of the outstanding and unpaid balance of the loan into common stock.

On May 31, 2018, the parties in the TCA12, LLC, a Florida limited liability company v. Major League Football agreed to amend the Settlement Agreement. Pursuant to the amendment, the Company paid the sum of $5,503 on June 4, 2018. That figure represents a good faith deposit of $5,000 and payment of an additional month’s storage charge of $503. An additional payment of $35,000 is to be made on or before June 30, 2018. As before, failure to make the payment shall be deemed a conveyance of MLFB’s right, title, and interest in football equipment currently in Plaintiff’s possession.

On June 1, 2018, due to lack of funding, the Company in the Interactive Liquid, LLC v. Major League Football, Inc failed to make the required payment of $40,000 and effective June 2, 2018, Interactive filed the stipulated judgment on June 4, 2018 in the amount of $153,016. There has been no full or partial satisfaction of the judgment and the full amount remains due and owing.

On June 8, 2018, the Company received $10,000 of proceeds from a private placement offering, representing 1,000,000 shares of stock at a sales price of $0.01 per share.

On June 28, 2018, the parties agreed to a second amendment to the Settlement agreement in the TCA12, LLC, a Florida limited liability company v. Major League Football. On June 29, MLFB once again paid the sum of $5,503. That figure represented a good faith deposit of $5,000 and payment of an additional month’s storage charge of $503. An additional payment of $30,000 is to be made on or before July 31, 2018. As before, failure to make the payment is be deemed a conveyance of MLFB’s right, title, and interest in football equipment currently in Plaintiff’s possession.

On July 18, 2018, pursuant to the Secured Convertible Promissory Note of March 9, 2016, SBI Investments LLC, 2014-1, converted $10,000 of principal debt under the note to 819,672 shares of common stock, leaving a remaining principal balance of $90,000 under the note.

On July 31, 2018, the parties in the TCA12, LLC, a Florida limited liability company v. Major League Football agreed to amend the Settlement Agreement. Pursuant to the amendment, the Company paid the sum of $1,503 on July 31, 2018. That figure represents a good faith deposit of $1,000 and payment of an additional month’s storage charge of $503. An additional payment of $29,000 is to be made on or before August 15, 2018. As before, failure to make the payment shall be deemed a conveyance of MLFB’s right, title, and interest in football equipment currently in Plaintiff’s possession