SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
____________________________________________________
FORM 10-K
(Mark One)
| [X] | ANNUAL REPORT PURSUANT TO SECTION 13 or 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
For the fiscal year ended December
31, 2014.
[ ] TRANSITION REPORT PURSUANT
TO SECTION 13 or 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the transition period from
_____________ to _________________.
Commission File No. 000-33053
MIND SOLUTIONS, Inc. |
(Exact name of registrant as specified
in its charter)
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Nevada |
01-0719410 |
(State or other jurisdiction of incorporation or organization) |
(I.R.S. Employer Identification No.) |
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3525 Del Mar Heights Road, Suite 802
San Diego, California |
92130 |
(Address of principal executive offices) |
(Zip Code) |
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Registrant’s telephone number,
including area code: (888) 461-3932 |
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Securities registered under Section 12(b) of the Exchange Act: |
None |
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Securities registered under Section 12(g) of the Exchange Act: |
Common stock, par value $0.0001 per share |
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(Title of class) |
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|
Indicate by check mark if the registrant
is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act. Yes [ ] No [X]
Indicate by check mark if the registrant
is not required to file reports pursuant to Section 13 or Section 15(d) of the Act. Yes [ ] No [X]
Indicate by check mark whether the registrant
(1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding
12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such
filing requirement for the past 90 days. Yes [X] No [ ]
Indicate by check mark whether the registrant
has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted
and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter
period that the registrant was required to submit and post such files). Yes [X] No [ ]
Indicate by check mark if
disclosure of delinquent filers pursuant to Item 405 of Regulation S-K (§229.405 of this chapter) is not contained
herein, and will not be contained, to the best of registrant’s knowledge, in definitive proxy or information statements
incorporated by reference in Part III of this Form 10-K or any amendment to this Form 10-K. [X]
Indicate by check mark whether the registrant
is a large accelerated filer, an accelerated filer, a non-accelerated filer or a smaller reporting company. See the definitions
of “large accelerated filer,” “accelerated filer,” and “smaller reporting company” in Rule
12b-2 of the Exchange Act:
Large accelerated filer [ ] |
Accelerated filer [ ] |
Non-accelerated filer [ ] |
Smaller reporting company [X] |
Indicate by check mark whether the registrant
is a shell company (as defined in Rule 12(b)-2 of the Exchange Act). Yes [ ] No [X]
The aggregate market value of the registrant’s
common stock held by non-affiliates of the registrant on June 30, 2014 (based on the closing sale price of $0.0017 per share of
the registrant’s common stock, as reported on the OTCQB operated by The OTC Markets Group, Inc. on that date) was approximately
$1,045,784. The stock price of $.0017 at June 30, 2014, takes into account a one for 2,000 reverse stock split on October 31, 2013.
Common stock held by each officer and director and by each person known to the registrant to own five percent or more of the outstanding
common stock has been excluded in that those persons may be deemed to be affiliates. This determination of affiliate status is
not necessarily a conclusive determination for other purposes.
Indicate the number of shares outstanding
of each of the registrant’s classes of common stock, as of the latest practicable date. At March 10, 2015, the registrant
had outstanding 1,748,242,047 shares of common stock, par value $0.001 per share.
Table of Contents
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Page |
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PART I |
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Item 1. |
Business |
4 |
Item 1A. |
Risk Factors |
9 |
Item 1B. |
Unresolved Staff Comments |
9 |
Item 2. |
Properties |
9 |
Item 3. |
Legal Proceedings |
10 |
Item 4. |
(Removed and Reserved) |
10 |
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PART II |
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Item 5. |
Market for Common Equity and Related Stockholder Matters |
10 |
Item 6. |
Selected Financial Data |
26 |
Item 7. |
Management’s Discussion and Analysis or Plan of Operations |
26 |
Item 7A. |
Quantitative and Qualitative Disclosure About Market Risk |
41 |
Item 8. |
Financial Statements |
41 |
Item 9. |
Changes In and Disagreements with Accountants on Accounting and Financial Disclosure |
41 |
Item 9A. |
Controls and Procedures |
42 |
Item 9AT. |
Controls and Procedures |
42 |
Item 9B. |
Other Information |
43 |
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PART III |
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Item 10. |
Directors, Executive Officers, Promoters and Control Persons; Compliance with Section 16(a) of the Exchange Act |
44 |
Item 11. |
Executive Compensation |
48 |
Item 12. |
Security Ownership of Certain Beneficial Owners and Management |
51 |
Item 13. |
Certain Relationships and Related Transactions |
52 |
Item 14. |
Principal Accountant Fees and Services |
57 |
Item 15. |
Exhibits, Financial Statement Schedules |
58 |
SPECIAL NOTE REGARDING FORWARD-LOOKING
STATEMENTS
In light of the risks and uncertainties
inherent in all projected operational matters, the inclusion of forward-looking statements in this Form 10-K, should not be regarded
as a representation by us or any other person that any of our objectives or plans will be achieved or that any of our operating
expectations will be realized. Our revenues and results of operations are difficult to forecast and could differ materially from
those projected in the forward-looking statements contained in this Form 10-K, as a result of certain risks and uncertainties including,
but not limited to, our business reliance on third parties to provide us with technology, our ability to integrate and manage acquired
technology, assets, companies and personnel, changes in market condition, the volatile and intensely competitive environment in
the business sectors in which we operate, rapid technological change, and our dependence on key and scarce employees in a competitive
market for skilled personnel. These factors should not be considered exhaustive; we undertake no obligation to release publicly
the results of any future revisions we may make to forward-looking statements to reflect events or circumstances after the date
hereof or to reflect the occurrence of unanticipated events.
PART I
Except for historical information, this
report contains forward-looking statements within the meaning of Section 21E of the Securities Exchange Act of 1934, as amended
(the “Exchange Act”). Such forward-looking statements involve risks and uncertainties, including, among other things,
statements regarding our business strategy, future revenues and anticipated costs and expenses. Such forward-looking statements
include, among others, those statements including the words “expects,” “anticipates,” “intends,”
“believes” and similar language. Our actual results may differ significantly from those projected in the forward-looking
statements. Factors that might cause or contribute to such differences include, but are not limited to, those discussed in the
section “Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations.” You
are cautioned not to place undue reliance on the forward-looking statements, which speak only as of the date of this report. We
undertake no obligation to publicly release any revisions to the forward-looking statements or reflect events or circumstances
taking place after the date of this document.
Item 1. Business.
The Company
MedStrong International Corporation was
incorporated in the State of Delaware on May 19, 2000, as Medical Records by Net, Inc. On October 17, 2000, its name was changed
to Lifelink Online, Inc. In January 2001, its name was changed to MedStrong Corporation. On March 9, 2001, the corporate name was
changed to MedStrong International Corporation. On January 31, 2007, our name was changed to VOIS, Inc.
On February 12, 2007, we announced a
change in our “shell company” status. We had been classified for reporting purposes as a “shell company”
(as such term is defined in Rule 12b-2 under the Exchange Act). Commencing in the first quarter of 2007, we had developed a new
line of business in connection with an Internet social networking site, incurred expenses developing this site, brought in senior
experienced management, and purchased certain assets in furtherance of this line of business.
On March 18, 2008, VOIS, Inc. changed
its domicile from the State of Delaware to the State of Florida. There was no change in our capital structure as a result of this
corporate event.
On October 19, 2012, VOIS, Inc. entered
into an Agreement and Plan of Merger (the “Merger Agreement”) with Mind Solutions, Inc., a Nevada corporation (“MSI”),
Mind Solutions, Inc., an Ontario corporation (“MSIC”) and Mind Solutions Acquisition Corp., a Nevada corporation (“MSAC”)
which was a wholly-owned subsidiary of our company formed for this transaction. Under the terms of the Merger Agreement, MSAC was
merged into MSI and MSI became a wholly-owned subsidiary of VOIS (the “Merger”). The stockholders of MSI were issued
a total of 196,000,000 shares of our common stock in exchange for 100 percent of the outstanding shares of MSI.
Upon the closing of the Merger, our sole
officer and director resigned and simultaneously with the Merger, Kerry Driscoll was appointed our sole officer and director. Our
business and operations are now the business and operations of Mind Solutions, Inc., a Nevada corporation.
On October 28, 2013, VOIS, Inc. changed
the state of incorporation of VOIS, Inc. from Florida to Nevada by means of a reverse merger with our wholly-owned subsidiary,
Mind Solutions, Inc., a Nevada corporation. As a result, we also adopted new articles of incorporation and new bylaws which will
govern our corporate operations under Nevada law. Along with the change of domicile, we changed our name to “Mind Solutions,
Inc.”
Business Overview
Our Current Business. Mind Solutions,
Inc. develops systems for the Brain-Computer-Interface (BCI) market, which includes state of the art micro electro encephalograph,
or EEG, wireless headset technology and software applications designed to operate with thought controlled technologies. Our software
development is currently compatible with the Emotiv EEG headset, allowing the user to control any action on their PC through the
power of their mind. We have three completed software applications on the market which operate on the Emotiv platform. We are working
to provide applications for the mobile market, utilizing an open architecture platform, allowing outside developers to create thought-controlled
applications, which can be submitted to Mind Solutions for review. Once approved, we plan to offer our products for sale on an
App Store in the near future.
Mind Solutions is working with a design
and manufacturing company in Southern California, which owns a manufacturing plant in China to develop our proprietary EEG headset
and bring it to market. This BCI headset will allow users to operate thought-controlled applications on their mobile phone devices
as well as on traditional PC computers. hawse have received working prototypes of the EEG headset, which have been successfully
tested and moving into the manufacturing phase.
With the use of a wireless headset that
detects and processes real time brain activity patterns (small voltage changes in the brain caused by the firing of neurons), the
user may be able to control any machine with the power of his mind. The sensors detect thoughts, feelings, and expressions and
initiates commands produced by the software we have developed based on research into the human brain – the central control
center for all our interactions and experiences. Using non-invasive electroencephalography (EEG), it is possible to observe each
person’s individual electrical brain activity.
If market conditions and our financial
circumstances allow, we anticipate that we may develop thought-controlled applications to communicate with our developed EEG headset
and, if we are successful in these efforts, we may add additional software applications thereafter. If these efforts are successful,
we may initiate one or more mobile device applications, or APP store, which will be designed to allow outside developers to participate
in a revenue sharing program for the thought-controlled applications they develop.
Our products fall under two categories:
software and hardware.
Software. Currently we have developed
three thought-controlled software applications, Mind Mouse, Master Mind, and Think Tac Toe, which are currently
available to consumers. These completed applications have been tested by our Scientific Advisory Board as well focus groups, including
persons with disabilities such as amyotrophic lateral sclerosis, or ALS, which is also known as Lou Gehrig’s disease. The
applications have all passed beta testing and are ready for commercialization to the public. The three completed applications are
sold online, direct to consumers and delivered via email as a download for their PC. Mind Mouse and Master Mind are
currently sold at $99, while the basic application of Think Tac Toe is sold for $49. These applications are available for
purchase as a software download through our Internet website at www.mindsolutionscorp.com.
Our current software products are as
follows:
| · | Mind Mouse. This thought-controlled software application is designed to allow the
user to navigate the computer, click and double click to open programs, compose email and send with the power of his mind.
The application can be used by anyone, but we believe
it is especially beneficial to people with disabilities who have communication problems. |
| · | Master Mind. This thought-controlled software application is designed to allow the user
to play existing PC games which are on the market with the power of his mind. Rather than using a traditional keyboard, mouse or
hand-held controller, the player controls the characters with his thoughts through the use of a wireless headset that reads the
player’s brainwaves. The user maps specific thoughts to create commands, which are received via a Bluetooth wireless USB.
Those commands cause the characters to run, shoot, jump or any other action used in the game. |
| · | Think-Tac-Toe. The thought-controlled version of tic-tac-toe, allows the user to play
against the computer using the power of his mind. The game provides the use of a gyroscope to move right, left, up or down. Once
the desired square is selected, the user concentrates to place an “X” or “O” in the respective box. The
game can be played entirely by cognitive thought, by thinking Right or Left or can utilize the gyroscope to move from square to
square. |
| · | Hardware. Our Micro EEG headset is currently in the development phase with completed,
functioning prototypes delivered and tested. The prototypes have been tested positively on Apple Iphones, PC computers, and Mac
computers and has received the communication and results our Scientific Advisory Board was expecting. The prototypes have also
been tested anatomically on several subjects and has received the brain signals and electrical impulses we were seeking. |
Our Micro EEG headset is designed to be the
smallest, lightest BCI device on the market. Our goal has been to create a user-friendly BCI that uses dry sensors in a way that
they do not stand out when worn and produce reliable, consistent results. While there are many uncertainties and variables beyond
our control in developing new products, if our market circumstances allow and provided that we can obtain sufficient amount of
additional financing, we may release the headset in the near future.
Patents and Intellectual Property
Patents. On August 1, 2012, Dr.
Gordon Chiu, our chief scientific adviser, filed an International Patent Application No. PCT/US2012/049135. Generally, the proprietary
technology consists of a “Portable Brain Activity Monitor.” As of the date of this report, we have yet to receive an
initial office action in this case. We are currently working on an additional embodiment for this invention. It appears that these
additions may require the filing of a continuation-in-part application.
A patent application does not in and
of itself grant exclusive rights. A patent application must be reviewed by the Patent Office of each relevant country prior to
issuing as a patent and granting exclusive rights.
On February 12, 2011, Mind Technologies,
Inc., one of our predecessors, and Dr. Gordon Chiu, our chief science advisor, granted us a license to use the technology covered
by his patent application. Through the series of mergers described in this report, Mind Solutions acquired the license granted
to Mind Technologies, Inc. For the period, that Mind Technologies, Inc. (now Mind Solutions) exists and funds the development and
progress of the covered invention, Dr. Chiu agreed to license the use of the technology to Mind Solutions. If Mind Solutions fails
to support the launch, progress and/or funding of the production of the invention, then the license may be terminated. The agreement
provided that Dr. Chiu will receive a non-refundable, non-dilutable cash royalty payment equal to 20 percent of the gross proceeds
received by Mind Solutions from the use of the covered technology. In addition, Brent Fouch, the former president of Mind Technologies,
and one of our advisors, will receive a non-refundable, non-dilutable cash royalty payment equal to five percent of the gross proceeds
received by Mind Solutions from the use of the covered technology. See “Item 13. Certain Relationships and Related Transactions
and Director Independence – Royalty Agreement.”
Trademarks. We do not have any
trademarks.
Rapid Technological Change Could Render Our Products Obsolete
Our markets are characterized by rapid
technological changes, frequent new product introductions and enhancements, uncertain product life cycles, changes in customer
requirements, and evolving industry standards. The introduction of new products embodying new technologies and the emergence of
new industry standards could render our existing products obsolete. Our future success will depend upon our ability to continue
to develop and introduce a variety of new products and product enhancements to address the increasingly sophisticated needs of
our customers. We may experience delays in releasing new products and product enhancements in the future. Material delays in introducing
new products or product enhancements may cause customers to forego purchases of our products and purchase those of our competitors.
We May Be Unable to Enforce or Defend Our Ownership and Use of
Proprietary Technology
Our success depends to a significant
degree upon our proprietary technology. Companies in the software industry have experienced substantial litigation regarding intellectual
property. We rely on a combination of patents, trade secrets, copyright law, contractual restrictions, and passwords to protect
our proprietary technology. However, these measures provide only limited protection, and we may not be able to detect unauthorized
use or take appropriate steps to enforce our intellectual property rights, particularly in foreign countries where the laws may
not protect our proprietary rights as fully as in the United States. Any litigation to enforce our intellectual property rights
would be expensive and time consuming, would divert management resources, and may not be adequate to protect our business.
We could be subject to claims that we
have infringed the intellectual property rights of others. In addition, we may be required to indemnify our customers for similar
claims made against them. Any claims against us could require us to spend significant time and money in litigation, pay damages,
develop new intellectual property or acquire licenses to intellectual properties that are the subject of the infringement claims.
These licenses, if required, may not be available on acceptable terms. As a result, intellectual property claims against us could
have a material adverse effect on our business, operating results, and financial condition.
Seasonality of Our Business
We do not anticipate that our business
will be affected by seasonal factors. The only expected impact would be increased retail sales of our software applications during
the Christmas season.
Impact of Inflation
We are affected by inflation along with
the rest of the economy. Specifically, our costs to complete the EEG headset (currently under development) could rise if specific
components needed see a rise in cost.
Suppliers
Our three software applications are already
complete and for sale online, therefore there are no supplier issues. Our EEG headset prototype has been produced by a company
out of Hong Kong and we intend to stay with them through completion, due to the cost savings with manufacturing overseas. In the
event of a supply problem, we have several back up companies in the U.S. such as Raytheon and others that could easily supply our
needs.
Competition
Currently, there are two large companies
of any significance in the BCI market. They are Emotiv and Neurosky. Emotiv provides the more complex EEG headset on the market,
which has 12 wet sensors and provides the most capabilities. In our discussions with Emotiv, its management have stated that it
has sold in excess of 200,000 headsets. Neurosky is another leader in the field and has a simplified EEG headset on the market
with only one to two sensors. It has been used to create popular toys such as “Star Wars Force Trainer,” whereby the
user concentrates to elevate a ping pong ball through a maze using only his mind.
Both Emotiv and Neurosky are larger,
better financed and have greater market exposure than we do. Consequently, in order for Mind Solutions to be successful in its
intended operations, it must be able to compete effectively against its competitors. If Mind Solutions cannot effectively compete
for whatever reason, we will not be successful.
Sales and Marketing
Mind Solutions currently sells its three
thought-controlled software applications via the Internet through our website at www.mindsolutionscorp.com. Consumers can also
purchase the Emotiv EEG headset through the website, which is required to operate our software. We are an approved reseller of
the Emotiv headset and sell the device at retail cost to consumers without a profit margin. Mind Solutions intends to launch a
robust marketing campaign to increase sales once our proprietary EEG headset is complete and our existing software applications
are made compatible with the device. At this point, we expect increased sales of the software and proprietary EEG headset with
solid profit margins. The planned marketing campaign is expected to utilize Internet, print and television marketing, with a public
relations firm assisting with media placement and interviews. We also expect to attend industry tradeshows such as the Consumer
Electronics Show held every year in Las Vegas, Nevada.
Regulations
The only government regulations that
we are aware of are the shipping and customs regulations for our products coming from Hong Kong. Once the final product is complete
and we place the initial order for shipment, we will need to adhere to normal customs and shipping regulations.
Key Personnel of Mind Solutions
Our future financial success depends
to a large degree upon the personal efforts of our key personnel. Kerry Driscoll, our chief executive officer, president, and chief
financial officer, and his intended designees will play the major roles in securing the services of those persons deemed capable
to develop and execute upon our business strategy. We currently have a Scientific Advisory Board spearheaded by Dr, Gordon Chiu
and Joe Abrams. While we intend to employ additional executive, development, and technical personnel in order to minimize the critical
dependency upon any one person, we may not be successful in attracting and retaining the persons needed.
We currently have a one year Consulting
Agreement with our chief executive officer, Kerry Driscoll, executed on December 25, 2013, whereby we issued 120,000,000 shares
of our common stock for executive consulting services to be provided over a one year term from the date of the agreement. See “Item
13. Certain Relationships and Related Transactions and Director Independence – Consulting Agreement.”
Adequacy of Working Capital for Mind Solutions
We will apply great efforts to raise
though equity or debt offerings what we feel is sufficient working capital for our intended business plan by various means. If
we are not able to raise additional capital, we would not be able to continue operations and our business may fail.
The Financial Results for Mind Solutions May Be Affected
by Factors Outside of Our Control
Our future operating results may vary
significantly from quarter to quarter due to a variety of factors, many of which are outside our control. Our anticipated expense
levels are based, in part, on our estimates of future revenues and may vary from projections. We may be unable to adjust spending
rapidly enough to compensate for any unexpected revenues shortfall. Accordingly, any significant shortfall in revenues in relation
to our planned expenditures would materially and adversely affect our business, operating results, and financial condition. Further,
we believe that period-to-period comparisons of our operating results are not necessarily a meaningful indication of future performance.
Employees
As of the date of this report, we do
not have any employees. Kerry Driscoll, our chief executive officer, president, and chief financial officer, is working for us
as an independent contractor, pursuant to a consulting agreement. See ““Item 13. Certain Relationships and Related
Transactions and Director Independence – Consulting Agreements.” All other persons working for Mind Solutions are also
independent contractors. We plan to save costs by keeping the software development and EEG hardware development with our independent
contractors. Dr. Gordon Chiu, our chief scientific advisor, will be considered to become an employee as well as a full time technical
support manager once the EEG headset is complete and funding is available. We anticipate adding up to two additional employees
in the next 12 months. We do not feel that we would have any difficulty in locating needed staff.
From time-to-time, we anticipate that
we will use the services of additional independent contractors and consultants to support our business development. We believe
our future success depends in large part upon the continued service of our senior management personnel and our ability to attract
and retain highly qualified managerial personnel.
Company Contact Information
Our principal executive offices are located
at 3525 Del Mar Heights Road, Suite 802, San Diego, California 92130, telephone (888) 461-3932, and fax (562) 252-8711. Our email
address is contact@mindsolutionscorp.com. The Mind Solutions Internet website is located at www.mindsolutionscorp.com. The information
contained in our website shall not constitute part of this report.
Item 1A. Risk Factors.
Not applicable.
Item
1B. Unresolved Staff Comments.
None.
Item 2. Properties.
The principal executive offices of Mind
Solutions are located at 3525 Del Mar Heights Road, Suite 802, San Diego, California 92130. We have been provided office space
by our chief executive officer, Kerry Driscoll, at no cost. Management has determined that such cost is nominal and did not recognize
the rent expense in its financial statements.
Item 3. Legal Proceedings.
Mind Solutions is not engaged in any
litigation at the present time, and management is unaware of any claims or complaints that could result in future litigation. Management
will seek to minimize disputes with our customers but recognizes the inevitability of legal action in today’s business environment
as an unfortunate price of conducting business.
Item 4. (Removed and
Reserved).
Not applicable.
PART II
Item 5. Market for Registrant’s
Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities.
Our common stock was traded on the OTCQB
from November 22, 2010, until April 30, 2014, under the symbol “VOIS.” Due to the trading price of our shares being
below $0.01 per share, beginning on May 1, 2014, our common stock has been traded on the OTC Pink. Our symbol remained the same.
The following table sets forth, taking
into consideration the one for 2,000 reverse split of our common stock which occurred on October 31, 2013, the high and low bid
prices for our common stock on the OTCQB as reported by various market makers. The quotations do not reflect adjustments for retail
mark-ups, mark-downs, or commissions and may not necessarily reflect actual transactions.
|
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High |
Low |
Fiscal 2013 Quarter Ended: |
|
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March 31, 2013 |
|
$0.022 |
$0.018 |
|
June 30, 2013 |
|
$0.003 |
$0.002 |
|
September 30, 2013 |
|
$0.0014 |
$0.0002 |
|
December 31, 2013 (1) |
|
$0.40 |
$0.0014 |
|
|
|
|
|
|
Fiscal 2014 Quarter Ended: |
|
|
|
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March 31, 2014 (1) |
|
$0.008 |
$0.0015 |
|
June 30, 2014 (1) |
|
$0.004 |
$0.0016 |
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September 30, 2014 (1) |
|
$0.008 |
$0.0001 |
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December 31, 2014 (1) |
|
$0.0042 |
$0.0015 |
|
_____________
(1) This price takes into account the
one for 2,000 reverse split which occurred on October 31, 2013.
As of March 10, 2015, we had
1,748,242,047 shares of our common stock outstanding. Our shares of common stock are held by approximately 538 stockholders
of record. The number of record holders was determined from the records of our transfer agent and does not include beneficial
owners of our common stock whose shares are held in the names of various securities brokers, dealers, and registered clearing
agencies. In addition to our authorized common stock, Mind Solutions is authorized to issue 10,000,000 shares of preferred
stock, par value $0.001 per share, of which 10,000,000 shares are issued or outstanding. Consequently, there is no trading
market for the shares of our preferred stock.
Dividends
We have not paid or declared any
dividends on our common stock, nor do we anticipate paying any cash dividends or other distributions on our common stock in
the foreseeable future. Any future dividends will be declared at the discretion of our board of directors and will depend,
among other things, on our earnings, if any, our financial requirements for future operations and growth, and other facts as
our board of directors may then deem appropriate.
Securities Authorized for Issuance
under Equity Compensation Plans
Authorized
Equity Compensation Plan Shares
Since January 1, 2013, we have taken
the following actions:
| · | On March 13, 2013, we filed with the SEC a Post-Effective Amendment
to our Registration Statement on Form S-8 in order to increase the number of shares of our common stock issuable on a registered
basis pursuant to stock options and other equity-based compensation awards that may be granted under our 2009 Equity Compensation
Plan. The number of shares covered by this plan was increased by 50,000,000 to 100,000,000 shares. |
| · | On September 9, 2013, we filed with the SEC a Post-Effective
Amendment to our Registration Statement on Form S-8 in order to increase the number of shares of our common stock issuable on a
registered basis pursuant to stock options and other equity-based compensation awards that may be granted under our 2009 Equity
Compensation Plan. The number of shares covered by this plan was increased by 185,000,000 to 285,000,000 shares. |
| · | On January 28, 2014, we filed with the SEC a Registration Statement on Form S-8 which covers
25,000,000 shares of our common stock available for issuance pursuant to awards under our 2014 Equity Compensation Plan. |
Issuance
of Equity Compensation Plan Shares
Since January 1, 2013, we have issued
the following shares for services rendered (all shares of our common stock which were issued have been adjusted to take into account
the one for 2,000 reverse split of the shares of our common stock which occurred on October 31, 2013):
| · | Pursuant to a Consulting Agreement dated January 30, 2013, on February 6, 2013, we issued 5,000
post reverse-split shares of our common stock to Brent Fouch, which shares had been registered pursuant to our Registration Statement
on Form S-8 filed June 11, 2009, with the SEC and a subsequent Post-Effective Amendment to Form S-8 filed with the SEC on December
3, 2012 |
| · | On February 8, 2013, we issued 5,000 post reverse-split shares of our common stock to Mark Lucky
for his consulting services rendered during the reverse merger with VOIS, which shares had been registered pursuant to our Registration
Statement on Form S-8 filed June 11, 2009, with the SEC and a subsequent Post-Effective Amendment to Form S-8 filed with the SEC
on December 3, 2012. |
| · | Pursuant to a Consulting Agreement dated February 20, 2013, on February 28, 2013, we issued 7,500
post reverse split shares of our common stock to Brent Fouch for consulting services rendered in the year ended December 31, 2013,
which shares had been registered pursuant to our Registration Statement on Form S-8 filed June 11, 2009, with the SEC and a subsequent
Post-Effective Amendment to Form S-8 filed with the SEC on December 3,2012. |
| · | On March 18, 2013, we issued 5,000 post reverse-split shares of our common stock to Christian
Hansen for consulting services, which shares had been registered pursuant to our Registration Statement on Form S-8 filed June
11, 2009, with the SEC and a subsequent Post-Effective Amendment to Form S-8 filed with the SEC on March 13, 2013. |
| · | On April 17, 2013, we issued 1,000 post reverse-split shares of our common stock to Jeff
Dashefsky for consulting services rendered as of March 31, 2013, which shares had been registered pursuant to our Registration Statement on Form S-8 filed June 11, 2009,
with the SEC and a subsequent Post-Effective Amendment to Form S-8 filed with the SEC on March 13, 2013. |
| · | Pursuant to a Consulting Agreement dated May 1, 2013, on May 10, 2013, we issued 5,000 post reverse-split
shares of our common stock to Brent Fouch, which shares had been registered pursuant to our Registration Statement on Form S-8
filed June 11, 2009, with the SEC and a subsequent Post-Effective Amendment to Form S-8 filed with the SEC on March 19, 2013. |
| · | Pursuant to a Consulting Agreement dated July 19, 2013, on July 26, 2013, we issued 10,000 post
reverse-split shares of our common stock to Brent Fouch, which shares had been registered pursuant to our Registration Statement
on Form S-8 filed June 11, 2009, with the SEC and a subsequent Post-Effective Amendment to Form S-8 filed with the SEC on March
13, 2013. |
| · | Pursuant to a Consulting Agreement dated September 2, 2013, on September 11, 2013, we issued
35,000 post reverse-split shares of our common stock to Brent Fouch, which shares had been registered pursuant to our Registration
Statement on Form S-8 filed June 11, 2009, with the SEC and a subsequent Post-Effective Amendment to Form S-8 filed with the SEC
on September 9, 2013. |
| · | On September 20, 2013, we issued 20,000 post reverse-split shares of our common stock to Jeff
Dashefsky for consulting services rendered, which shares had been registered pursuant to our Registration Statement on Form S-8
filed June 11, 2009, with the SEC and a subsequent Post-Effective Amendment to Form S-8 filed with the SEC on September 9, 2013. |
| · | Pursuant to a Consulting Agreement dated September 26, 2013, on September 30, 2013, we issued
19,688 post reverse-split shares of our common stock to Brent Fouch for consulting services rendered, which shares had been registered
pursuant to our Registration Statement on Form S-8 filed June 11, 2009, with the SEC and a subsequent Post-Effective Amendment
to Form S-8 filed with the SEC on September 9, 2013. |
| · | On September 30, 2013, we issued 17,812 post reverse-split shares of our common stock to Kerry
Driscoll for consulting services rendered, which shares had been registered pursuant to our Registration Statement on Form S-8
filed June 11, 2009, with the SEC and a subsequent Post-Effective Amendment to Form S-8 filed with the SEC on September 9, 2013. |
| · | Pursuant to a Consulting Agreement dated January 2, 2014, on January 31, 2014, we issued 10,000,000
post reverse-split shares of our common stock to Brent Fouch, which shares had been registered pursuant to our Registration Statement
on Form S-8 filed with the SEC on January 28, 2014. |
| · | On March 31, 2014, we issued 5,000 post reverse-split shares to Noah Fouch for consulting services,
which shares had been registered pursuant to our Registration Statement on Form S-8 filed January 28, 2014. |
| · | Pursuant to a Consulting Agreement dated May 2, 2014, on May 14, 2014, we issued 2,500 post reverse-split
shares of our common stock to Brent Fouch, which shares had been registered pursuant to our Registration Statement on Form S-8
filed January 28, 2014, with the SEC. |
| · | Pursuant to a Consulting Agreement dated August 20, 2014, on August 28, 2014, we issued 30,000,000
post reverse-split shares of our common stock to Brent Fouch, which shares had been registered pursuant to our Registration Statement
on Form S-8 filed January 28, 2014, with the SEC. |
| · | Pursuant to a Consulting Agreement dated September 2, 2014, on September 30, 2014, we issued
30,000,000 post reverse-split shares of our common stock to Noah Fouch, which shares had been registered pursuant to our Registration
Statement on Form S-8 filed January 28, 2014, with the SEC. |
Recent Sales of Unregistered Securities
On the dates specified
below, we have issued shares of our common stock to various creditors, IBC Funds, LLC, Magna Group, LLC, Hanover Holdings I, LLC,
Asher Enterprises, Inc., JMJ Financial, Gel Properties, LLC, LG Capital Funding, LLC, WHC Capital, AARG Corp, KBM Worldwide, Inc.,
Cicero Consulting Group, LLC and other parties.
IBC Funds, LLC.
On November 21, 2013, IBC Funds, LLC, a Nevada limited liability company, acquired by assignment, debts owed by Mind Solutions
to four creditors in the amount of $82,845.63. Likewise, on November 21, 2013, IBC Funds and Mind Solutions executed that certain
Settlement Agreement and Stipulation, whereby Mind Solutions agreed to settle the debt of $82,845.63, and to pay the debt by the
issuance of shares pursuant to Section 3(a)(10) of the Securities Act of 1933, as amended (the “Securities Act”), which
provides that the issuance of shares are exempt from the registration requirement of Section 5 of the Securities Act. In relevant
part, Section 3(a)(10) of the Securities Act provides an exemption from the registration requirement for securities: (i) which
are issued in exchange for a bona fide claim, (ii) where the terms of the issuance and exchange are found by a court to be fair
to those receiving shares, (iii) notice of the hearing is provided to those to receive shares and they are afforded the opportunity
to be heard, (iv) the issuer must advise the court prior to its hearing that it intends to rely on the exemption provided in Section
3(a)(10) of the Securities Act, and (v) there cannot be any impediments to the appearance of interested parties at the hearing.
On November 22, 2013,
in a court proceeding styled IBC Funds, LLC, a Nevada limited Liability Company, Plaintiff vs. Mind Solutions, Inc., a Nevada
corporation, Defendant, bearing Civil Action No. 2013 CA 008370 NC, in the Circuit Court in the Twelfth Judicial Circuit in and
for Sarasota County, Florida, after due notice, the court entered an order approving the Settlement Agreement and Stipulation.
In satisfaction of the debt, we agreed to issue shares of our common stock in one or more tranches to IBC Funds in the manner contemplated
in the Settlement Agreement and Stipulation at a conversion price of $0.0045 per share. In accordance with the terms of the Settlement
Agreement and Stipulation, the court was advised of our intention to rely upon the exception to registration set forth in Section
3(a)(l0) of the Securities Act to support the issuance of the shares.
As set forth in the
order, the court found that the terms and conditions of the exchange were fair to Mind Solutions and IBC Funds within the meaning
of Section 3(a)(10) of the Securities Act, and that the exchange of the debt for our securities was not made under Title 11 of
the United States Code.
As permitted by the court order and the
Settlement Agreement and Stipulation, we issued 77,298,674 post reverse split shares of our common stock to IBC Funds, LLC, as
follows:
| · | On December 4, 2013, we issued 822,674 post reverse split shares of our common stock to IBC Funds,
LLC for the reduction of $15,000 in convertible debt. The shares were issued free of any restrictions as permitted by Section 3(a)(10)
of the Securities Act. |
| · | On December 11, 2013, we issued 1,300,000 post reverse split shares of our common stock to IBC
Funds, LLC for the reduction of $3,445 in convertible debt. The shares were issued free of any restrictions as permitted by Section
3(a)(10) of the Securities Act. |
| · | On December 12, 2013, we issued 1,300,000 post reverse split shares of our common stock to IBC
Funds, LLC for the reduction of $3,315 in convertible debt. The shares were issued free of any restrictions as permitted by Section
3(a)(10) of the Securities Act. |
| · | On January 10, 2014, we issued 1,400,000 post reverse split shares of our common stock to IBC
Funds, LLC for the reduction of $980 in convertible debt. The shares were issued free of any restrictions as permitted by Section
3(a)(10) of the Securities Act. |
| · | On January 14, 2014, we issued 1,500,000 post reverse split shares of our common stock to IBC
Funds, LLC for the reduction of $1,050 in convertible debt. The shares were issued free of any restrictions as permitted by Section
3(a)(10) of the Securities Act. |
| · | On January 23, 2014, we issued 7,000,000 post reverse split shares of our common stock to IBC
Funds, LLC for the reduction of $3,850 in convertible debt. The shares were issued free of any restrictions as permitted by Section
3(a)(10) of the Securities Act. |
| · | On January 28, 2014, we issued 7,000,000 post reverse split shares of our common stock to IBC
Funds, LLC for the reduction of $3,850 in convertible debt. The shares were issued free of any restrictions as permitted by Section
3(a)(10) of the Securities Act. |
| · | On January 29, 2014, we issued 7,000,000 post reverse split shares of our common stock to IBC
Funds, LLC for the reduction of $3,850 in convertible debt. The shares were issued free of any restrictions as permitted by Section
3(a)(10) of the Securities Act. |
| · | On January 31, 2014, we issued 7,000,000 post reverse split shares of our common stock to IBC
Funds, LLC for the reduction of $3,850 in convertible debt. The shares were issued free of any restrictions as permitted by Section
3(a)(10) of the Securities Act. |
| · | On February 6, 2014, we issued 7,000,000 post reverse split shares of our common stock to IBC
Funds, LLC for the reduction of $4,200 in convertible debt. The shares were issued free of any restrictions as permitted by Section
3(a)(10) of the Securities Act. |
| · | On February 7, 2014, we issued 7,000,000 post reverse split shares of our common stock to IBC
Funds, LLC for the reduction of $5,250 in convertible debt. The shares were issued free of any restrictions as permitted by Section
3(a)(10) of the Securities Act. |
| · | On February 8, 2014, we issued 7,000,000 post reverse split shares of our common stock to IBC
Funds, LLC for the reduction of $8,750 in convertible debt. The shares were issued free of any restrictions as permitted by Section
3(a)(10) of the Securities Act. |
| · | On February 10, 2014, we issued 12,000,000 post reverse split shares of our common stock to IBC
Funds, LLC for the reduction of $15,000 in convertible debt. The shares were issued free of any restrictions as permitted by Section
3(a)(10) of the Securities Act. |
| · | On February 12, 2014, we issued 9,976,000 post reverse split shares of our common stock to IBC
Funds, LLC for the reduction of $12,470 in convertible debt. The shares were issued free of any restrictions as permitted by Section
3(a)(10) of the Securities Act. |
Magna Group, LLC. Beginning
in 2010 and continuing into 2014, there were several agreements executed between Mind Solutions, Inc. and its predecessors with
Brent Fouch, one of the officers of a predecessor. Mr. Fouch had loaned the sum of $347,292 to the predecessor of Mind Solutions
for working capital purposes. Mr. Fouch subsequently assigned some of the notes to Magna Group, LLC. See “Item 13. Certain
Relationships and Related Transactions and Director Independence – Transactions with Brent Fouch.” Upon conversion
of the notes, Magna Group, LLC received 52,803,315 post reverse split shares of our common stock as follows:
| · | On February 8, 2013, we issued 364 post reverse split shares of our common stock to Magna Group,
LLC for the reduction of $10,000 in convertible debt. The shares were issued free of any restrictions pursuant to Rule 144 under
the Securities Act. |
| · | On February 14, 2013, we issued 4,399 post reverse split shares of our common stock to Magna
Group, LLC for the reduction of $15,000 in convertible debt. The shares were issued free of any restrictions pursuant to Rule 144
under the Securities Act. |
| · | On February 27, 2013, we issued 4,261 post reverse split shares of our common stock to Magna
Group, LLC for the reduction of $15,000 in convertible debt. The shares were issued free of any restrictions pursuant to Rule 144
under the Securities Act. |
| · | On March 13, 2013, we issued 7,331 post reverse split shares of our common stock to Magna Group,
LLC for the reduction of $25,000 in convertible debt. The shares were issued free of any restrictions pursuant to Rule 144 under
the Securities Act. |
| · | On March 21, 2013, we issued 8,021 post reverse split shares of our common stock to Magna Group,
LLC for the reduction of $15,000 in convertible debt. The shares were issued free of any restrictions pursuant to Rule 144 under
the Securities Act. |
| · | On June 6, 2013, we issued 10,868 post reverse split shares of our common stock to Magna Group,
LLC for the reduction of $20,324 in convertible debt. The shares were issued free of any restrictions pursuant to Rule 144 under
the Securities Act. |
| · | On June 20, 2013, we issued 11,818 post reverse split shares of our common stock to Magna Group,
LLC for the reduction of $13,000 in convertible debt. The shares were issued free of any restrictions pursuant to Rule 144 under
the Securities Act. |
| · | On July 8, 2013, we issued 18,182 post reverse split shares of our common stock to Magna Group,
LLC for the reduction of $18,000 in convertible debt. The shares were issued free of any restrictions pursuant to Rule 144 under
the Securities Act. |
| · | On July 24, 2013, we issued 19,181 post reverse split shares of our common stock to Magna Group,
LLC for the reduction of $15,000 in convertible debt. The shares were issued free of any restrictions pursuant to Rule 144 under
the Securities Act. |
| · | On August 7, 2013, we issued 36,364 post reverse split shares of our common stock to Magna Group,
LLC for the reduction of $20,000 in convertible debt. The shares were issued free of any restrictions pursuant to Rule 144 under
the Securities Act. |
| · | On August 28, 2013, we issued 60,606 post reverse split shares of our common stock to Magna Group,
LLC for the reduction of $20,000 in convertible debt. The shares were issued free of any restrictions pursuant to Rule 144 under
the Securities Act. |
| · | On September 10, 2013, we issued 73,164 post reverse split shares of our common stock to Magna
Group, LLC for the reduction of $16,096 in convertible debt. The shares were issued free of any restrictions pursuant to Rule 144
under the Securities Act. |
| · | On September 18, 2013, we issued 81,818 post reverse split shares of our common stock to Magna
Group, LLC for the reduction of $9,000 in convertible debt. The shares were issued free of any restrictions pursuant to Rule 144
under the Securities Act. |
| · | On September 24, 2013, we issued 81,818 post reverse split shares of our common stock to Magna
Group, LLC for the reduction of $9,000 in convertible debt. The shares were issued free of any restrictions pursuant to Rule 144
under the Securities Act. |
| · | On September 25, 2013, we issued 65,909 post reverse split shares of our common stock to Magna
Group, LLC for the reduction of $7,000 of principle and $250 in accrued interest relating to the outstanding convertible debt.
The shares were issued free of any restrictions pursuant to Rule 144 under the Securities Act. |
| · | On December 4, 2013, we issued 374,111 post reverse split shares of our common stock to Magna
Group, LLC for the reduction of $5,000 of principle in convertible debt. The shares were issued free of any restrictions pursuant
to Rule 144 under the Securities Act. |
| · | On December 11, 2013, we issued 1,069,519 post reverse split shares of our common stock to Magna
Group, LLC for the reduction of $3,000 in outstanding convertible debt. The shares were issued free of any restrictions pursuant
to Rule 144 under the Securities Act. |
| · | On December 20, 2013, we issued 1,547,107 post reverse split shares of our common stock to Magna
Group, LLC for the reduction of $1,872 in outstanding convertible debt. The shares were issued free of any restrictions pursuant
to Rule 144 under the Securities Act. |
| · | On December 26, 2013, we issued 1,818,182 post reverse split shares of our common stock to Magna
Group, LLC for the reduction of $2,000 in outstanding convertible debt. The shares were issued free of any restrictions pursuant
to Rule 144 under the Securities Act. |
| · | On January 9, 2014, we issued 2,181,818 post reverse split shares of our common stock to Magna
Group, LLC for the reduction of $3,000 in outstanding convertible debt. The shares were issued free of any restrictions pursuant
to Rule 144 under the Securities Act. |
| · | On January 10, 2014, we issued 7,272,727 post reverse split shares of our common stock to Magna
Group, LLC for the reduction of $8,000 in outstanding convertible debt. The shares were issued free of any restrictions pursuant
to Rule 144 under the Securities Act. |
| · | On January 21, 2014, we issued 8,264,462 post reverse split shares of our common stock to Magna
Group, LLC for the reduction of $5,000 in outstanding convertible debt. The shares were issued free of any restrictions pursuant
to Rule 144 under the Securities Act. |
| · | On January 27, 2014, we issued 13,223,140 post reverse split shares of our common stock to Magna
Group, LLC for the reduction of $8,000 in outstanding convertible debt. The shares were issued free of any restrictions pursuant
to Rule 144 under the Securities Act. |
| · | On January 29, 2014, we issued 16,568,145 post reverse split shares of our common stock to Magna
Group, LLC for the reduction of $13,000 in outstanding convertible debt. The shares were issued free of any restrictions pursuant
to Rule 144 under the Securities Act. |
Hanover Holdings I, LLC. In 2013,
we executed various Securities Purchase Agreements with Hanover Holdings I, LLC, whereby we issued convertible promissory notes
to Hanover Holdings I, LLC bearing interest on the unpaid balance at the rate of 10 percent. We issued 75,745,890 post reverse
split shares of our common stock to Hanover Holdings I, LLC, in connection with the conversions of the convertible promissory notes
as follows:
| · | On August 23, 2013, we issued 38,374 post reverse split shares of our common stock to Hanover
Holdings I, LLC, as a result of their notice to convert $20,000 of principle and $1,106 of accrued interest on their outstanding
convertible promissory note. The shares were issued free of any restrictions pursuant to Rule 144 under the Securities Act. |
| · | On September 10, 2013, we issued 73,164 post reverse split shares of our common stock to Hanover
Holdings I, LLC, as a result of their notice to convert $16,096 of their outstanding convertible promissory note. The shares were
issued free of any restrictions pursuant to Rule 144 under the Securities Act. |
| · | On September 30, 2013, we issued 100,000 post reverse split shares of our common stock to Hanover
Holdings I, LLC, as a result of their notice to convert $11,000 of their outstanding convertible promissory note. The shares were
issued free of any restrictions pursuant to Rule 144 under the Securities Act. |
| · | On October 8, 2013, we issued 59,659 post reverse split shares of our common stock to Hanover
Holdings I, LLC, as a result of their notice to convert $5,500 of principle and $1,063 of accrued interest on their outstanding
convertible promissory note. The shares were issued free of any restrictions pursuant to Rule 144 under the Securities Act. |
| · | On October 14, 2013, we issued 59,091 post reverse split shares of our common stock to Hanover
Holdings I, LLC, as a result of their notice to convert $6,500 of their outstanding convertible promissory note. The shares were
issued free of any restrictions pursuant to Rule 144 under the Securities Act. |
| · | On October 16, 2013, we issued 59,091 post reverse split shares of our common stock to Hanover
Holdings I, LLC, as a result of their notice to convert $6,500 of their outstanding convertible promissory note. The shares were
issued free of any restrictions pursuant to Rule 144 under the Securities Act. |
| · | On November 20, 2013, we issued 186,199 post reverse split shares of our common stock to Hanover
Holdings I, LLC, as a result of their notice to convert $3,500 of principle and $1,143 of accrued interest on their outstanding
convertible promissory note. The shares were issued free of any restrictions pursuant to Rule 144 under the Securities Act. |
| · | On January 29, 2014, we issued 16,969,697 post reverse split shares of our common stock to Hanover
Holdings I, LLC, as a result of their notice to convert $14,000 of their outstanding convertible promissory note. The shares were
issued free of any restrictions pursuant to Rule 144 under the Securities Act. |
| · | On January 31, 2014, we issued 18,181,818 post reverse split shares of our common stock to Hanover
Holdings I, LLC, as a result of their notice to convert $11,000 of their outstanding convertible promissory note. The shares were
issued free of any restrictions pursuant to Rule 144 under the Securities Act. |
| · | On February 6, 2014, we issued 22,934,315 post reverse split shares of our common stock to Hanover
Holdings I, LLC, as a result of their notice to convert $16,500 of principle and $2,421 of accrued interest on their outstanding
convertible promissory note. The shares were issued free of any restrictions pursuant to Rule 144 under the Securities Act. |
| · | On February 14, 2014, we issued 7,438,017 post reverse split shares of our common stock to Hanover
Holdings I, LLC, as a result of their notice to convert $13,500 of their outstanding convertible promissory note. The shares were
issued free of any restrictions pursuant to Rule 144 under the Securities Act. |
| · | On February 20, 2014, we issued 9,646,465 post reverse split shares of our common stock to Hanover
Holdings I, LLC, as a result of their notice to convert $13,000 of principle and $1,325 of accrued interest on their outstanding
convertible promissory note. The shares were issued free of any restrictions pursuant to Rule 144 under the Securities Act. |
| · | On May 2, 2014, we issued 31,619,318 post reverse split shares of our common stock to Hanover
Holdings I, LLC, as a result of their notice to convert $26,500 of principle and $1,325 of accrued interest on their outstanding
convertible promissory note. The shares were issued free of any restrictions pursuant to Rule 144 under the Securities Act. |
Asher Enterprises, Inc.
In 2012, 2013, and 2014, we executed various Securities Purchase Agreements with Asher Enterprises, Inc., whereby we issued convertible
promissory notes to Asher Enterprises, Inc. bearing interest on the unpaid balance at the rate of eight percent. We issued 62,644,259
post reverse split shares of our common stock to Asher Enterprises, Inc., as a result of the conversion of the convertible promissory
notes as follows:
| · | On July 30, 2013, we issued 18,293 post reverse split shares of our common stock to Asher Enterprises,
Inc., as a result of their notice to convert $15,000 of their outstanding convertible promissory note. The shares were issued free
of any restrictions pursuant to Rule 144 under the Securities Act. |
| · | On July 31, 2013, we issued 19,595 post reverse split shares of our common stock to Asher Enterprises,
Inc., as a result of their notice to convert $14,500 of their outstanding convertible promissory note. The shares were issued free
of any restrictions pursuant to Rule 144 under the Securities Act. |
| · | On August 8, 2013, we issued 6,515 post reverse split shares of our common stock to Asher Enterprises,
Inc., as a result of their notice to convert $3,000 of principle and $1,300 of accrued interest on their outstanding convertible
promissory note. The shares were issued free of any restrictions pursuant to Rule 144 under the Securities Act. |
| · | On September 13, 2013, we issued 26,667 post reverse split shares of our common stock to Asher
Enterprises, Inc., as a result of their notice to convert $6,400 of their outstanding convertible promissory note. The shares were
issued free of any restrictions pursuant to Rule 144 under the Securities Act. |
| · | On September 19, 2013, we issued 26,250 post reverse split shares of our common stock to Asher
Enterprises, Inc., as a result of their notice to convert $4,200 of their outstanding convertible promissory note. The shares were
issued free of any restrictions pursuant to Rule 144 under the Securities Act. |
| · | On September 20, 2013, we issued 26,667 post reverse split shares of our common stock to Asher
Enterprises, Inc., as a result of their notice to convert $3,200 of their outstanding convertible promissory note. The shares were
issued free of any restrictions pursuant to Rule 144 under the Securities Act. |
| · | On September 24, 2013, we issued 26,667 post reverse split shares of our common stock to Asher
Enterprises, Inc., as a result of their notice to convert $3,200 of their outstanding convertible promissory note. The shares were
issued free of any restrictions pursuant to Rule 144 under the Securities Act. |
| · | On September 25, 2013, we issued 26,667 post reverse split shares of our common stock to Asher
Enterprises, Inc., as a result of their notice to convert $3,200 of their outstanding convertible promissory note. The shares were
issued free of any restrictions pursuant to Rule 144 under the Securities Act. |
| · | On September 27, 2013, we issued 26,667 post reverse split shares of our common stock to Asher
Enterprises, Inc., as a result of their notice to convert $3,200 of their outstanding convertible promissory note. The shares were
issued free of any restrictions pursuant to Rule 144 under the Securities Act. |
| · | On September 30, 2013, we issued 26,667 post reverse split shares of our common stock to Asher
Enterprises, Inc., as a result of their notice to convert $3,200 of their outstanding convertible promissory note. The shares were
issued free of any restrictions pursuant to Rule 144 under the Securities Act. |
| · | On November 25, 2013, we issued 131,707 post reverse split shares of our common stock to Asher
Enterprises, Inc., as a result of their notice to convert $2,700 of their outstanding convertible promissory note. The shares were
issued free of any restrictions pursuant to Rule 144 under the Securities Act. |
| · | On November 26, 2013, we issued 131,707 post reverse split shares of our common stock to Asher
Enterprises, Inc., as a result of their notice to convert $2,700 of their outstanding convertible promissory note. The shares were
issued free of any restrictions pursuant to Rule 144 under the Securities Act. |
| · | On December 4, 2013, we issued 1,191,403 post reverse split shares of our common stock to Asher
Enterprises, Inc., as a result of their notice to convert $15,000 of their outstanding convertible promissory note. The shares
were issued free of any restrictions pursuant to Rule 144 under the Securities Act. |
| · | On December 5, 2013, we issued 134,328 post reverse split shares of our common stock to Asher
Enterprises, Inc., as a result of their notice to convert $500 of principle and $1,300 of accrued interest on their outstanding
convertible promissory note. The shares were issued free of any restrictions pursuant to Rule 144 under the Securities Act. |
| · | On December 12, 2013, we issued 2,411,765 post reverse split shares of our common stock to Asher
Enterprises, Inc., as a result of their notice to convert $12,300 of their outstanding convertible promissory note. The shares
were issued free of any restrictions pursuant to Rule 144 under the Securities Act. |
| · | On January 9, 2014, we issued 2,419,355 post reverse split shares of our common stock to Asher
Enterprises, Inc., as a result of their notice to convert $2,250 of their outstanding convertible promissory note. The shares were
issued free of any restrictions pursuant to Rule 144 under the Securities Act. |
| · | On January 14, 2014, we issued 2,428,571 post reverse split shares of our common stock to Asher
Enterprises, Inc., as a result of their notice to convert $2,210 of their outstanding convertible promissory note. The shares were
issued free of any restrictions pursuant to Rule 144 under the Securities Act. |
| · | On February 19, 2014, we issued 2,457,831 post reverse split shares of our common stock to Asher
Enterprises, Inc., as a result of their notice to convert $740 of principle and $1,300 of accrued interest on their outstanding
convertible promissory note. The shares were issued free of any restrictions pursuant to Rule 144 under the Securities Act. |
| · | On May 19, 2014, we issued 15,463,918 post reverse split shares of our common stock to Asher
Enterprises, Inc., as a result of their notice to convert $15,000 on their outstanding convertible promissory note. The shares
were issued free of any restrictions pursuant to Rule 144 under the Securities Act. |
| · | On May 27, 2014, we issued 15,789,474 post reverse split shares of our common stock to Asher
Enterprises, Inc., as a result of their notice to convert $15,000 on their outstanding convertible promissory note. The shares
were issued free of any restrictions pursuant to Rule 144 under the Securities Act. |
| · | On May 28, 2014, we issued 14,947,368 post reverse split shares of our common stock to Asher
Enterprises, Inc., as a result of their notice to convert $12,500 together with $1,700 of accrued interest on their outstanding
convertible promissory note. The shares were issued free of any restrictions pursuant to Rule 144 under the Securities Act. |
| · | On August 14, 2014, we issued 18,072,289 post reverse split shares of our common stock to Asher
Enterprises, Inc., as a result of their notice to convert $15,000 on their outstanding convertible promissory note. The shares
were issued free of any restrictions pursuant to Rule 144 under the Securities Act. |
| · | On August 18, 2014, we issued 18,518,519 post reverse split shares of our common stock to Asher
Enterprises, Inc., as a result of their notice to convert $15,000 on their outstanding convertible promissory note. The shares
were issued free of any restrictions pursuant to Rule 144 under the Securities Act. |
| · | On August 21, 2014, we issued 14,516,129 post reverse split shares of our common stock to Asher
Enterprises, Inc., as a result of their notice to convert $7,500 together with $1,500 of accrued interest on their outstanding
convertible promissory note. The shares were issued free of any restrictions pursuant to Rule 144 under the Securities Act. |
JMJ Financial. On May 15, 2013,
we executed a convertible promissory note in favor of JMJ Financial in an amount up to $250,000 bearing interest on the unpaid
balance at the rate of 12 percent. While the note was in the original principal amount up to $250,000, it was only partially funded
on May 15, 2013, in the amount of $30,000, plus pro-rated original issue discount and pro-rated interest in the amount of $7,333.33,
on August 14, 2013, in the amount of $20,000, on December 9, 2013, in the amount of $25,000, on April 16, 2014, in the amount of
$40,000, on June 23, 2014 in the amount of $60,000 and on December 16, 2014, in the amount of $25,000. After allowing for conversions,
only $59,311 of the note was convertible on the date of this report. We issued 225,433,784 post reverse split shares of our common
stock to JMJ Financial, as a result of the conversion of the convertible promissory note as follows:
| · | On December 5, 2013, we issued 822,674 post reverse split shares of our common stock to JMJ Financial,
as a result of their notice to convert $15,000 of principle on their outstanding convertible promissory note. The shares were issued
free of any restrictions pursuant to Rule 144 under the Securities Act. |
| · | On January 29, 2014, we issued 7,900,000 post reverse split shares of our common stock to JMJ
Financial, as a result of their notice to convert $5,214 of principle on their outstanding convertible promissory note. The shares
were issued free of any restrictions pursuant to Rule 144 under the Securities Act. |
| · | On February 5, 2014, we issued 11,200,000 post reverse split shares of our common stock to JMJ
Financial, as a result of their notice to convert $7,392 of principle on their outstanding convertible promissory note. The shares
were issued free of any restrictions pursuant to Rule 144 under the Securities Act. |
| · | On February 10, 2014, we issued 16,200,000 post reverse split shares of our common stock to JMJ
Financial, as a result of their notice to convert $10,692 of principle on their outstanding convertible promissory note. The shares
were issued free of any restrictions pursuant to Rule 144 under the Securities Act. |
| · | On February 24, 2014, we issued 18,900,000 post reverse split shares of our common stock to JMJ
Financial, as a result of their notice to convert $12,474 of principle on their outstanding convertible promissory note. The shares
were issued free of any restrictions pursuant to Rule 144 under the Securities Act. |
| · | On February 27, 2014, we issued 20,000,000 post reverse split shares of our common stock to JMJ
Financial, as a result of their notice to convert $12,000 of principle on their outstanding convertible promissory note. The shares
were issued free of any restrictions pursuant to Rule 144 under the Securities Act. |
| · | On April 3, 2014, we issued 14,363,704 post reverse split shares of our common stock to JMJ Financial,
as a result of their notice to convert $8,618 of principle on their outstanding convertible promissory note. The shares were issued
free of any restrictions pursuant to Rule 144 under the Securities Act. |
| · | On June 20, 2014, we issued 16,000,000 post reverse split shares of our common stock to JMJ Financial,
as a result of their notice to convert $15,360 of principle on their outstanding convertible promissory note. The shares were issued
free of any restrictions pursuant to Rule 144 under the Securities Act. |
| · | On July 15, 2014, we issued 16,407,407 post reverse split shares of our common stock to JMJ Financial,
as a result of their notice to convert $15,751 of principle on their outstanding convertible promissory note. The shares were issued
free of any restrictions pursuant to Rule 144 under the Securities Act. |
| · | On October 16, 2014, we issued 20,000,000 post reverse split shares of our common stock to JMJ
Financial, as a result of their notice to convert $21,600 of principle on their outstanding convertible promissory note. The shares
were issued free of any restrictions pursuant to Rule 144 under the Securities Act. |
| · | On November 10, 2014, we issued 18,062,673 post reverse split shares of our common stock to JMJ
Financial, as a result of their notice to convert $28,178 of principle on their outstanding convertible promissory note. The shares
were issued free of any restrictions pursuant to Rule 144 under the Securities Act. |
· | On
December 29, 2014, we issued 66,000,000 post reverse split shares of our common stock
to JMJ Financial, as a result of their notice to convert $19,800 of principle on their
outstanding convertible promissory note. The shares were issued free of any restrictions
pursuant to Rule 144 under the Securities Act. |
Gel Properties, LLC.
In 2014, we executed various Securities Purchase Agreements with Gel Properties, LLC, whereby we issued convertible promissory
notes to Gel Properties, LLC bearing interest on the unpaid balance at the rate of 10 percent. We issued 104,836,148 post reverse
split shares of our common stock to Gel Properties, LLC, in connection with the conversions of the convertible promissory notes
as follows:
| · | On August 18, 2014, we issued 7,575,758 post reverse split shares of our common stock to Gel
Properties, LLC, as a result of their notice to convert $5,000 of principle on their outstanding convertible promissory note. The
shares were issued free of any restrictions pursuant to Rule 144 under the Securities Act. |
| · | On August 20, 2014, we issued 13,223,140 post reverse split shares of our common stock to Gel
Properties, LLC, as a result of their notice to convert $8,000 of principle on their outstanding convertible promissory note. The
shares were issued free of any restrictions pursuant to Rule 144 under the Securities Act. |
| · | On August 25, 2014, we issued 12,727,273 post reverse split shares of our common stock to Gel
Properties, LLC, as a result of their notice to convert $7,000 of principle on their outstanding convertible promissory note. The
shares were issued free of any restrictions pursuant to Rule 144 under the Securities Act. |
| · | On September 1, 2014, we issued 14,491,795 post reverse split shares of our common stock to Gel
Properties, LLC, as a result of their notice to convert $5,000 of principle on their outstanding convertible promissory note. The
shares were issued free of any restrictions pursuant to Rule 144 under the Securities Act. |
| · | On September 3, 2014, we issued 23,863,636 post reverse split shares of our common stock to Gel
Properties, LLC, as a result of their notice to convert $10,000 of principle on their outstanding convertible promissory note.
The shares were issued free of any restrictions pursuant to Rule 144 under the Securities Act. |
| · | On September 8, 2014, we issued 22,727,273 post reverse split shares of our common stock to Gel
Properties, LLC, as a result of their notice to convert $10,000 of principle on their outstanding convertible promissory note.
The shares were issued free of any restrictions pursuant to Rule 144 under the Securities Act. |
| · | On September 11, 2014, we issued 10,227,273 post reverse split shares of our common stock to
Gel Properties, LLC, as a result of their notice to convert $5,000 of principle on their outstanding convertible promissory note.
The shares were issued free of any restrictions pursuant to Rule 144 under the Securities Act. |
LG Capital Funding, LLC.
In 2014, we executed various Securities Purchase Agreements with LG Capital Funding, LLC, whereby we issued convertible promissory
notes to with LG Capital Funding, LLC bearing interest on the unpaid balance at the rate of 10 percent. We issued 145,117,267
post reverse split shares of our common stock to with LG Capital Funding, LLC, in connection with the conversions of the convertible
promissory notes as follows:
| · | On August 3, 2014, we issued 23,872,976 post reverse split shares of our common stock to with
LG Capital Funding, LLC, as a result of their notice to convert $15,000 of principle and $756 of accrued interest on their outstanding
convertible promissory note. The shares were issued free of any restrictions pursuant to Rule 144 under the Securities Act. |
| · | On August 27, 2014, we issued 23,991,282 post reverse split shares of our common stock to with
LG Capital Funding, LLC, as a result of their notice to convert $10,000 of principle and $556 of accrued interest on their outstanding
convertible promissory note. The shares were issued free of any restrictions pursuant to Rule 144 under the Securities Act.
|
| · | On August 28, 2014, we issued 36,801,432 post reverse split shares of our common stock to with
LG Capital Funding, LLC, as a result of their notice to convert $15,100 of principle and $93 of accrued interest on their outstanding
convertible promissory note. The shares were issued free of any restrictions pursuant to Rule 144 under the Securities Act. |
| · | On
September 11, 2014, we issued 20,404,607 post reverse split shares of our common stock
to with LG Capital Funding, LLC, as a result of their notice to convert $8,900 of principle
and $78 of accrued interest on their outstanding convertible promissory note. The shares
were issued free of any restrictions pursuant to Rule 144 under the Securities Act. |
| · | On September 29, 2014, we issued 20,018,266 post reverse split shares of our common stock to
with LG Capital Funding, LLC, as a result of their notice to convert $20,000 of principle on their outstanding convertible promissory
note. The shares were issued free of any restrictions pursuant to Rule 144 under the Securities Act. |
| · | On October 1, 2014, we issued 20,028,704 post reverse split shares of our common stock to with
LG Capital Funding, LLC, as a result of their notice to convert $20,000 of principle and $1,030 of accrued interest on their outstanding
convertible promissory note. The shares were issued free of any restrictions pursuant to Rule 144 under the Securities Act. |
WHC Capital, LLC. In 2014,
we executed various Securities Purchase Agreements with WHC Capital, LLC, whereby we issued convertible promissory notes to with
WHC Capital, LLC bearing interest on the unpaid balance at the rate of 12 percent. We issued 32,000,000 post reverse split shares
of our common stock to with WHC Capital, LLC, in connection with the conversions of the convertible promissory notes as follows:
| · | On December 9, 2014, we issued 32,000,000 post reverse split shares of our common stock to with
WHC Capital, LLC, as a result of their notice to convert $24,000 of principle on their outstanding convertible promissory note.
The shares were issued free of any restrictions pursuant to Rule 144 under the Securities Act. |
ARRG Corp. In 2014, we
executed various Securities Purchase Agreements with ARRG Corp., whereby we issued convertible promissory notes to with ARRG Corp.
bearing interest on the unpaid balance at the rate of 8 percent. We issued 37,142,857 post reverse split shares of our common
stock to with ARRG Corp., in connection with the conversions of the convertible promissory notes as follows:
| · | On November 27, 2014, we issued 37,142,857 post reverse split shares of our common stock to with
ARRG Corp., as a result of their notice to convert $50,000 of principle and $2,000 of accrued interest on their outstanding convertible
promissory note. The shares were issued free of any restrictions pursuant to Rule 144 under the Securities Act. |
Caesar Capital Group, LLC.
In 2014, we executed various Securities Purchase Agreements with Caesar Capital Group, LLC, whereby we issued convertible promissory
notes to with Caesar Capital Group, LLC bearing interest on the unpaid balance at the rate of 8 percent. We issued 37,166,878
post reverse split shares of our common stock to with Caesar Capital Group, LLC, in connection with the conversions of the convertible
promissory notes as follows:
| · | On October 17, 2014, we issued 37,166,878 post reverse split shares of our common stock to with
Caesar Capital Group, LLC, as a result of their notice to convert $50,000 of principle and $2,034 of accrued interest on their
outstanding convertible promissory note. The shares were issued free of any restrictions pursuant to Rule 144 under the Securities
Act. |
KBM Worldwide, Inc. In 2014,
we executed various Securities Purchase Agreements with KBM Worldwide Inc., whereby we issued convertible promissory notes to
with KBM Worldwide Inc. bearing interest on the unpaid balance at the rate of 8 percent. We issued 45,948,276 post reverse split
shares of our common stock to with KBM Worldwide Inc., in connection with the conversions of the convertible promissory notes
as follows:
| · | On November 8, 2014, we issued 15,000,000 post reverse split shares of our common stock to with
KBM Worldwide Inc., as a result of their notice to convert $15,000 of principle on their outstanding convertible promissory note.
The shares were issued free of any restrictions pursuant to Rule 144 under the Securities Act. |
| · | On November 17, 2014, we issued 17,500,000 post reverse split shares of our common stock to with
KBM Worldwide Inc., as a result of their notice to convert $17,500 of principle on their outstanding convertible promissory note.
The shares were issued free of any restrictions pursuant to Rule 144 under the Securities Act. |
| · | On November 19, 2014, we issued 13,448,276 post reverse split shares of our common stock to with
KBM Worldwide Inc., as a result of their notice to convert $10,000 of principle and $1,700 of accrued interest on their outstanding
convertible promissory note. The shares were issued free of any restrictions pursuant to Rule 144 under the Securities Act. |
Cicero Consulting Group, LLC.
In 2014, we executed various Securities Purchase Agreements with Cicero Consulting Group, LLC, whereby we issued convertible
promissory notes to with Cicero Consulting Group, LLC bearing interest on the unpaid balance at the rate of 8 percent. We issued
131,078,431 post reverse split shares of our common stock to with Cicero Consulting Group, LLC, in connection with the conversions
of the convertible promissory notes as follows:
| · | On November 17, 2014, we issued 29,411,764 post reverse split shares of our common stock to with
Cicero Consulting Group, LLC, as a result of their notice to convert $50,000 of principle on their outstanding convertible promissory
note. The shares were issued free of any restrictions pursuant to Rule 144 under the Securities Act. |
| · | On December 16, 2014, we issued 41,666,667 post reverse split shares of our common stock to with
Cicero Consulting Group, LLC, as a result of their notice to convert $50,000 of principle on their outstanding convertible promissory
note. The shares were issued free of any restrictions pursuant to Rule 144 under the Securities Act. |
| · | On February 11, 2015, we issued 50,000,000 post reverse split shares of our common stock to with
Cicero Consulting Group, LLC, as a result of their notice to convert $50,000 of principle on their outstanding convertible promissory
note. The shares were issued free of any restrictions pursuant to Rule 144 under the Securities Act. |
Iconic Holdings, LLC.
In 2014, we executed various Securities Purchase Agreements with Iconic Holdings, LLC, whereby we issued convertible promissory
notes to with Iconic Holdings, LLC, bearing interest on the unpaid balance at the rate of 8 percent. We issued 68,750,000 post
reverse split shares of our common stock to with Iconic Holdings, LLC, in connection with the conversions of the convertible promissory
notes as follows:
| · | On December 27, 2014, we issued 68,750,000 post reverse split shares of our common stock to with
Iconic Holdings, LLC, as a result of their notice to convert $27,500 of principle on their outstanding convertible promissory note.
The shares were issued free of any restrictions pursuant to Rule 144 under the Securities Act. |
We issued 237,603,815 post reverse split
shares of our common stock to consultants and others, as follows;
| · | On November 4, 2012, we issued 5,000 post reverse split shares of our common stock to James Mahony
for consulting services rendered in the year ended December 31, 2012. The shares issued to Mr. Mahony were restricted in their
transfer as required by the Securities Act. |
| · | On November 14, 2012, we issued 98,000 post reverse split shares of our common stock to Kerry
Driscoll as a result of a cash payment of $50,000, in connection with the merger of Mind Solutions, Inc. and VOIS, Inc. The shares
issued to Mr. Driscoll were restricted in their transfer as required by the Securities Act. |
| · | On November 15, 2012, we issued 100 post reverse split shares of our common stock to JT Trading
for consulting services rendered in the year ended December 31, 2012. The shares issued to JT Trading were restricted in their
transfer as required by the Securities Act. |
| · | On November 15, 2012, we issued 250 post reverse split shares of our common stock to Kyle Spiewek
for consulting services rendered in the year ended December 31, 2012. The shares issued to Mr. Spiewek were restricted in their
transfer as required by the Securities Act. |
| · | On December 12, 2012, we issued 100 post reverse split shares of our common stock to Jeff Dashefsky
for consulting services rendered in the year ended December 31, 2012. The shares issued to Mr. Dashefsky were restricted in their
transfer as required by the Securities Act. |
| · | Pursuant to a License Agreement dated December 18, 2012, on December 18, 2012, we issued 3,500
post reverse split shares of our common stock to Mind Technologies, Inc. The shares issued to Mind Technologies, Inc. were restricted
in their transfer as required by the Securities Act. |
| · | On March 22, 2013, we issued 4,000 post reverse split shares of our common stock to Larry Simon
for consulting services rendered in the year ended December 31, 2013. The shares issued to Mr. Simon were restricted in their transfer
as required by the Securities Act. |
| · | Pursuant to a Consulting Agreement dated March 18, 2013, on March 22, 2013, we issued 15,000
post reverse split shares of our common stock to Relaunch Consulting Group for consulting services rendered in the year ended December
31, 2013. The shares issued to Relaunch Consulting Group were restricted in their transfer as required by the Securities Act. |
| · | On April 11, 2013, we issued 10,625 post reverse-split shares
of our common stock to Brent Fouch, which were issued free of any restrictions pursuant to Rule 144 under the Securities
Act. The shares were issued resulting from the conversion of the Convertible Promissory Note
dated December 31, 2010. |
| · | On June 16, 2013, we issued 15,000 post reverse split shares of our common stock to Mind Technologies,
Inc. pursuant to an Asset Purchase Agreement. The shares issued to Mind Technologies, Inc. were restricted in their transfer as
required by the Securities Act. |
| · | On August 23, 2013, pursuant to an Officer Agreement, we issued 238,000 post reverse split shares
of our common stock to Jeff Dashefsky in consideration for services rendered by Mr. Dashefsky as an officer of VOIS, Inc. since
April 4, 2011, and to be rendered throughout the one year term of the Officer Agreement, as full compensation in lieu of cash payment
for services. The shares issued to Mr. Dashefsky were restricted in their transfer as required by the Securities Act. |
| · | Pursuant to a Consulting Agreement dated November 11, 2013, on November 11, 2013, we issued 1,500,000
post reverse split shares of our common stock to Mirador Consulting LLC for consulting services rendered in the year ended December
31, 2013. The shares issued to Mirador Consulting LLC were restricted in their transfer as required by the Securities Act. |
| · | Pursuant to a Consulting Agreement dated November 11, 2013, on November 25, 2013, we issued 200,000
post reverse split shares of our common stock to First Swiss Capital, Inc. for consulting services rendered in the year ended December
31, 2013. The shares issued to First Swiss Capital, Inc. were restricted in their transfer as required by the Securities Act. |
| · | On December 25, 2013, we issued 20,000,000 post reverse split shares of our common stock to Kerry
Driscoll pursuant to a Consulting Agreement dated December 25, 2013. The shares issued to Mr, Driscoll were restricted in their
transfer as required by the Securities Act. |
| · | On January 6, 2014, we issued 100,000,000 post reverse split shares of our common stock to Kerry
Driscoll pursuant to a Consulting Agreement dated December 25, 2013. The shares issued to Mr, Driscoll were restricted in their
transfer as required by the Securities Act. |
| · | Pursuant to a Consulting Agreement dated November 11, 2013, on January 15, 2014, we issued
6,000,000 post reverse split shares of our common stock to Mirador Consulting LLC for consulting services to be rendered in
the year ended December 31, 2014. The shares issued to Mirador Consulting LLC were restricted in their transfer as required
by the Securities Act. |
| · | On March 14, 2014, we issued 11,627,907 post reverse split shares of our common stock to Monster
Arts, Inc. for consulting services pursuant to a Consulting Agreement dated February 12, 2014. The shares issued to Monster Arts,
Inc. were restricted in their transfer as required by the Securities Act. |
| · | On March 18, 2014, we issued 5,000,000 post reverse split shares of our common stock to Brett
Cusick pursuant to a Consulting Agreement dated March 18, 2014. The shares issued to Mr. Cusick were restricted in their transfer
as required by the Securities Act. |
| · | On March 19, 2014, we issued to Premier Venture Partners, LLC, a California limited liability
company, 12,765,957 shares of our common stock as Initial Commitment Shares in connection with an Equity Purchase Agreement dated
March 11, 2014. The shares issued to Premier Venture Partners were restricted in their transfer as required by the Securities Act.
See “Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations – Subsequent
Events.” |
| · | On May 11, 2014, we issued 5,000,000 post reverse split shares of our common stock to IN2NE Corp.
pursuant to a Consulting Agreement dated May 11, 2014. The shares issued to IN2NE Corp. were restricted in their transfer as required
by the Securities Act. |
| · | On June 2, 2014, we issued 15,000,000 post reverse-split shares of our common stock to Dr. Gordon
Chiu. The shares issued to Dr. Chiu were restricted in their transfer as required by the Securities Act. |
| · | On August 28, 2014, we issued 30,000,000 post reverse split shares of our common stock to Brent
Fouch pursuant to a Consulting Agreement dated August 20, 2014. The shares issued to Mr, Fouch were restricted in their transfer
as required by the Securities Act. |
| · | On September 30, 2014, we issued 30,000,000 post reverse split shares of our common stock to
Noah Fouch pursuant to a Consulting Agreement dated September 2, 2014. The shares issued to Mr, Fouch were restricted in their
transfer as required by the Securities Act. |
As stated above, beginning in
2010 and continuing into 2014, there were several agreements executed between Mind Solutions, Inc. and its predecessors with Brent
Fouch, one of the officers of a predecessor. Mr. Fouch had loaned the sum of $347,292 to the predecessor of Mind Solutions for
working capital purposes. Mr. Fouch subsequently assigned some of the notes to Magna Group, LLC. See “Item 13. Certain Relationships
and Related Transactions and Director Independence – Transactions with Brent Fouch.” On June 5, 2013, in an Assignment
Agreement between Mr. Fouch, as assignor, Magna Group, LLC, as assignee, and VOIS, Inc., Mr. Fouch assigned to Magna Group, LLC
$106,324 of the Convertible Promissory Note dated December 31, 2010, issued by Mind Solutions, Inc. in favor of Brent Fouch, in
the amount of $157,324.06. Mr. Fouch retained $51,000.06 of the Convertible Promissory Note dated December 31, 2010, which was
converted into 10,625 shares of our common stock, pursuant to a Debt Conversion Agreement dated April 4, 2013, by and between
Brent Fouch and VOIS, Inc. The shares issued to Mr. Fouch were restricted in their transfer as required by the Securities Act.
Our unregistered securities were issued
in reliance upon an exemption from registration pursuant to Section 4(a)(2) of the Securities Act or Rule 506 of Regulation D promulgated
under the Securities Act. Each investor took his securities for investment purposes without a view to distribution and had access
to information concerning us and our business prospects, as required by the Securities Act. In addition, there was no general solicitation
or advertising for the purchase of our securities. Our securities were sold only to an accredited investor, as defined in the Securities
Act with whom we had a direct personal preexisting relationship, and after a thorough discussion. Finally, our stock transfer agent
has been instructed not to transfer any of such securities, unless such securities are registered for resale or there is an exemption
with respect to their transfer.
All of the above described investors
who received shares of our common stock were provided with access to our filings with the SEC, including the following:
| · | The information contained in our annual report on Form 10-K under the Exchange Act. |
| · | The information contained in any reports or documents required to be filed by Mind Solutions
under sections 13(a), 14(a), 14(c), and 15(d) of the Exchange Act since the distribution or filing of the reports specified above. |
| · | A brief description of the securities being offered, and any material changes in our affairs
that were not disclosed in the documents furnished. |
Purchases of Equity Securities
by the Registrant and Affiliated Purchasers
There were no purchases of our equity
securities by Mind Solutions or any affiliated purchasers during any month within the fiscal year covered by this report.
Item 6. Selected Financial
Data.
Not applicable.
Item 7. Management’s
Discussion and Analysis of Financial Condition and Results of Operations.
THE FOLLOWING DISCUSSION SHOULD BE READ
TOGETHER WITH THE INFORMATION CONTAINED IN THE FINANCIAL STATEMENTS AND RELATED NOTES INCLUDED ELSEWHERE IN THIS ANNUAL REPORT
ON FORM 10-K.
The following discussion reflects our
plan of operation. This discussion should be read in conjunction with the financial statements which are attached to this report.
This discussion contains forward-looking statements, including statements regarding our expected financial position, business and
financing plans. These statements involve risks and uncertainties. Our actual results could differ materially from the results
described in or implied by these forward-looking statements as a result of various factors, including those discussed below and
elsewhere in this report, particularly under the headings “Special Note Regarding Forward-Looking Statements.”
Unless
the context otherwise suggests, “we,” “our,” “us,” and similar terms, as well as references
to “VOIS” and “Mind Solutions,” all refer to Mind Solutions as of the date of this report.
Mind Solutions has successfully developed
software applications described below that run on Emotive EEG headsets. We have experienced minimal sales of our software applications.
It was decided by management that to better position Mind Solutions in the market, we should develop our own unique EEG headset
that would allow us to have more market strength. We have invested a significant amount of money and time into developing a prototype
EEG headset, which has been successfully tested on several android devices and tablets.
On August 1, 2012, Dr. Gordon Chiu, our
chief scientific adviser, filed an International Patent Application No. PCT/US2012/049135. Generally, the proprietary technology
we are using consists of a “Portable Brain Activity Monitor.” On February 12, 2011, Mind Technologies, Inc., one of
our predecessors, and Dr. Gordon Chiu, our chief science advisor, granted us a license to use the technology covered by his patent
application. Through the series of mergers described in this report, Mind Solutions acquired the license granted to Mind Technologies,
Inc. For the period, that Mind Technologies, Inc. (now Mind Solutions) exists and funds the development and progress of the covered
invention, Dr. Chiu agreed to license the use of the technology to Mind Solutions. If Mind Solutions fails to support the launch,
progress and/or funding of the production of the invention, then the license may be terminated. The agreement provided that Dr.
Chiu will receive a non-refundable, non-dilutable cash royalty payment equal to 20 percent of the gross proceeds received by Mind
Solutions from the use of the covered technology. In addition, Brent Fouch, the former president of Mind Technologies, and one
of our advisors, will receive a non-refundable, non-dilutable cash royalty payment equal to five percent of the gross proceeds
received by Mind Solutions from the use of the covered technology. See “Item1. Business – Patents and Intellectual
Property.”
We believe a minimum of $350,000 is still
needed to complete the EEG device, which will cover costs associated with the SDK (operating system), the design work to create
a sleek, consumer-friendly final product and updates on the hardware including Bluetooth wireless updates. We have announced our
desire to partner with a larger technology firm to invest in the completion of the EEG headset in return for a negotiated interest
in the product. If successful, in attracting a partner, we will not need to raise this capital to complete the project. If we are
not successful in attracting a financial partner to assist in the completion of the EEG headset, we plans to raise funds by means
of an equity offering to raise the necessary capital to complete the project.
Mind Solutions currently has a need of
approximately $20,000 per month to sustain operations until sales of the software and anticipated sales of the EEG headset increase.
Going Concern
As of December 31, 2014, Mind Solutions
had an accumulated deficit during development stage of $20,892,024. Also, during the year ended December 31, 2014, we used net
cash of $781,293 for operating activities. These factors raise substantial doubt about our ability to continue as a going concern.
While we are attempting to commence operations
and generate revenues, our cash position may not be significant enough to support our daily operations. Management intends to raise
additional funds by way of an offering of our securities. Management believes that the actions presently being taken to further
implement our business plan and generate revenues provide the opportunity for Mind Solutions to continue as a going concern. While
we believe in the viability of our strategy to generate revenues and in our ability to raise additional funds, we may not be successful.
Our ability to continue as a going concern is dependent upon our capability to further implement our business plan and generate
revenues.
Results of Operations
Year
Ended December 31, 2014 Compared to Year Ended December 31, 2013.
Revenues
During the years ended December 31, 2014
and 2013 we had little revenue. In the years ended December 31, 2014 and 2013, we had revenues from the sale of our software products
in the amounts of $534 and $1,163 which was decrease of $629. In the years ended December 31, 2014 and 2013, we had services revenues
of $100,000 and $0 which was an increase of $100,000. The increase in service revenues were from a consulting agreement in which
the Company was paid in stock of the client. Therefore, we classified the stock as a Marketable Securities: Available for Sale
asset in which we revalued at each reporting date based on the closing stock price. The client’s stock price has greatly
decreased since receiving the stock, so we have recorded an Other Comprehensive Loss on Available-for-Sale Securities of $96,042
in the year ended December 31, 2014. We are aggressively looking for ways to leverage our technology to develop revenue streams.
Cost of Sales
During the years ended December 31, 2014
and 2013 we had cost of sales of $174 and $678 which was a decrease of $504. Our cost of sales is primarily made up of the cost
to produce and distribute our software applications.
Operating Expenses.
Consulting Fees. For the year
ended December 31, 2014, consulting expense decreased to $1,125,289 as compared to $1,603,037 from the prior year ended December
31, 2013 which was a decrease of $477,748. The decrease was primarily the result of less stock being issued to consultants for
services rendered to the Company.
Officer Compensation. For the
year ended December 31, 2014, officer compensation decreased to $160,000 as compared to $289,748 from the prior year ended December
31, 2013 which was a decrease of $129,748. Officer compensation decreased due to less stock
being issued to our sole officers as compensation for services. In the year ended December 31, 2014, our sole officer received
$155,000 cash as compensation. In the year ended December 31, 2013, our sole officer received $15,060 cash and $274,688 in stock
compensation.
Professional Fees. For the year
ended December 31, 2014, professional fees decreased to $201,595 as compared to $229,420 from the prior year ended December 31,
2013 which was a decrease of $27,825. Professional fee expense decreased slightly due to decrease in accounting and legal fees
due to the merger with Mind Solutions, Inc. in 2013.
General and Administrative Expense.
For the year ended December 31, 2014, general and administrative expenses increased to $54,013 as compared to $48,564 from the
prior year ended December 31, 2013 which was a increase of $5,449. For the years ended December 31, 2014, and 2013, general and
administrative expenses consisted of the following:
| |
2014 | |
2013 |
Advertising | |
$ | 11,815 | | |
$ | 4,735 | |
Edgarizing & XBRL | |
| 17,353 | | |
| 12,783 | |
Depreciation | |
| 2,577 | | |
| 2,442 | |
Other | |
| 22,268 | | |
| 28,604 | |
| |
$ | 54,013 | | |
$ | 48,564 | |
Advertising. For the year ended
December 31, 2014, advertising expense amounted to $11,815 as compared to $4,735 for the year ended December 31, 2013. The increase
was due to additional funds being spent on web development.
Edgarizing & EBRL. For the
year ended December 31, 2014, edgarizing and XBRL expense amounted to $17,353 as compared to $12,783 for the year ended December
31, 2013.
Depreciation. For the year ended
December 31, 2014, depreciation expense amounted to $2,577 as compared to $2,442 for the year ended December 31, 2013.
Other Expense. For the year ended
December 31, 2014, other expenses which includes repairs and maintenance, postage, dues and subscriptions, supplies, etc. amounted
to $22,268 as compared to $28,604 for the year ended December 31, 2013.
Net Loss. Our net loss from operations
decreased to $1,440,537 for the year ended December 31, 2014, from $2,170,284 for the year ended December 31, 2013.
Interest Expense. For the year
ended December 31, 2014, interest expense increased to $143,332 as compared to $46,834 for the year ended December 31, 2013. The
increase was due to additional original issue discount interest expense incurred on the convertible notes payable funded in 2014.
Gain/(Loss) on Derivative Adjustment.
For the year ended December 31, 2014, the Company had a gain on derivative adjustment of $4,077,634 as compared to loss on derivative
adjustment of $20,036,965 for the year ended December 31, 2013. The decrease in the fair value of the derivative liability calculated
using the Black Scholes Model pertaining to our outstanding convertible notes payable caused the gain/(loss) on derivative adjustment.
Liquidity and Capital Resources
Liquidity is the ability of a company
to generate adequate amounts of cash to meet its needs for cash. The following table provides certain selected balance sheet comparisons
between December 31, 2014, and December 31, 2013:
|
|
December 31, |
|
December 31, |
|
$ |
|
Percent |
2014 |
2013 |
Change |
Change |
Working Capital |
|
$ (2,905,127) |
|
$ (20,639,541) |
|
$ 17,734,414 |
|
Over 100% |
Cash |
|
113,199 |
|
47,428 |
|
65,771 |
|
Over 100% |
Total current assets |
|
159,219 |
|
336,978 |
|
(177,759) |
|
(52.8)% |
Total assets |
|
165,954 |
|
339,396 |
|
(173,442 |
) |
(51.1)% |
Accounts payable and accrued liabilities |
|
392,665 |
|
394,859 |
|
(2,194) |
|
(0.5)% |
Notes payable and accrued interest |
|
939,375 |
|
670,918 |
|
268,457 |
|
40.0 % |
Total current liabilities |
|
3,099,263 |
|
20,976,519 |
|
(17,877,256 |
) |
(Over 100 %) |
Total liabilities |
|
$ 3,099,263 |
|
$ 20,976,519 |
|
$ (17,877,256) |
|
(Over 100%) |
At December 31, 2014, our working capital
deficit decreased as compared to December 31, 2013, primarily as a result of an decrease in derivative liability of $18,140,019.
Operating Activities
Net cash used for continuing operating
activities during fiscal 2014 was $781,293 as compared to $388,177 for fiscal 2013. Non-cash items totaling approximately $3,309,975
contributing to the net cash used in continuing operating activities for fiscal 2014 include:
| · | $562,361 representing the value of shares issued to consultants and officers; |
| · | $4,077,634 of gain on derivative adjustment; |
| · | $100,000 of available-for-sale securities received for service revenues; |
| · | $57,139 of original issue discount; |
| · | $2,577 of depreciation; and |
| · | $80,499 increase in accounts payable. |
Net cash used for continuing operating
activities during fiscal 2013 was $388,177. Non-cash items totaling approximately $21,754,296 contributing to the net cash used
in continuing operating activities for fiscal 2013 include:
| · | $1,467,703 representing the value of shares issued to consultants and officers; |
| · | $19,907,242 of derivative expense; |
| · | $480,000 of available-for-sale securities compensation; |
| · | $111,610 of forgiveness of debt; |
| · | $2,442 of depreciation; and |
| · | $8,519 increase in accounts payable. |
Investing Activities
Net cash used in investing activities
was $0 for both fiscal 2014 and 2013.
Financing Activities
For the year ended December 31, 2014,
net cash used in financing activities was $850,000 which consisted of $850,000 in proceeds from convertible notes. For the year
ended December 31, 2013, net cash used in financing activities was $435,397 which consisted of $425,345 in proceeds from convertible
notes, $48,526 in proceeds from convertible notes to related parties and $38,474 in payments against notes payable to related parties.
IBC Funds, LLC.
On November 21, 2013, IBC Funds, LLC, a Nevada limited liability company, acquired by assignment, debts owed by Mind Solutions
to four creditors in the amount of $82,845.63. Likewise, on November 21, 2013, IBC Funds and Mind Solutions executed that certain
Settlement Agreement and Stipulation, whereby Mind Solutions agreed to settle the debt of $82,845.63, and to pay the debt by the
issuance of shares pursuant to Section 3(a)(10) of the Securities Act, which provides that the issuance of shares are exempt from
the registration requirement of Section 5 of the Securities Act. In relevant part, Section 3(a)(10) of the Securities Act provides
an exemption from the registration requirement for securities: (i) which are issued in exchange for a bona fide claim, (ii) where
the terms of the issuance and exchange are found by a court to be fair to those receiving shares, (iii) notice of the hearing is
provided to those to receive shares and they are afforded the opportunity to be heard, (iv) the issuer must advise the court prior
to its hearing that it intends to rely on the exemption provided in Section 3(a)(10) of the Securities Act, and (v) there cannot
be any impediments to the appearance of interested parties at the hearing.
On November 22, 2013,
in a court proceeding styled IBC Funds, LLC, a Nevada limited Liability Company, Plaintiff vs. Mind Solutions, Inc., a Nevada
corporation, Defendant, bearing Civil Action No. 2013 CA 008370 NC, in the Circuit Court in the Twelfth Judicial Circuit in and
for Sarasota County, Florida, after due notice, the court entered an order approving the Settlement Agreement and Stipulation.
In satisfaction of the debt, we agreed to issue shares of our common stock in one or more tranches to IBC Funds in the manner contemplated
in the Settlement Agreement and Stipulation at a conversion price of $0.0045 per share. In accordance with the terms of the Settlement
Agreement and Stipulation, the court was advised of our intention to rely upon the exception to registration set forth in Section
3(a)(l0) of the Securities Act to support the issuance of the shares.
As set forth in the
order, the court found that the terms and conditions of the exchange were fair to Mind Solutions and IBC Funds within the meaning
of Section 3(a)(10) of the Securities Act, and that the exchange of the debt for our securities was not made under Title 11 of
the United States Code.
As permitted by the court order and the
Settlement Agreement and Stipulation, we issued 77,298,674 post reverse split shares of our common stock to IBC Funds, LLC. The
shares were issued free of any restrictions as permitted by Section 3(a)(10) of the Securities Act.
Hanover Holdings I, LLC Financing.
In 2013, we executed various Securities Purchase Agreements with Hanover Holdings I, LLC, whereby we issued convertible promissory
notes to Hanover Holdings I, LLC bearing interest on the unpaid balance at the rate of 10 percent, as follows:
| · | Convertible promissory note dated February 4, 2013, in the original principal amount of $16,500.
As a result of a conversion of the note, we issued 159,659 shares of our common stock to Hanover Holdings I, LLC. As of the date
of this report, the note is paid in full. |
| · | Convertible promissory note dated March 7, 2013, in the original principal amount of $16,500.
As a result of a conversion of the note, we issued 304,379 shares of our common stock to Hanover Holdings I, LLC. As of the date
of this report, the note is paid in full. |
| · | Convertible promissory note dated June 5, 2013, in the original principal amount of $41,500.
As a result of a conversion of the note, we issued 58,085,830 shares of our common stock to Hanover Holdings I, LLC. As of the
date of this report, the note is paid in full. |
| · | Convertible promissory note dated August 7, 2013, in the original principal amount of $26,500.
As a result of a conversion of the note, we issued 17,084,482 shares of our common stock to Hanover Holdings I, LLC. As of the
date of this report, the note is paid in full. |
| · | Convertible promissory note dated November 23, 2013, in the original principal amount of $26,500.
As of the date of this report, the note is paid in full. |
Each of the notes was convertible
into shares of our common stock by dividing the Conversion Amount (as defined below) by the applicable Conversion Price then in
effect on the date specified in the notice of conversion. The term “Conversion Amount” means, with respect to any
conversion of a note, the sum of (1) the principal amount of the note to be converted in such conversion plus (2) at Hanover Holdings
I, LLC’s option, accrued and unpaid interest, if any, on such principal amount at the interest rates provided in the note
to the Conversion Date; provided, however, that Mind Solutions shall have the right to pay any or all interest in cash plus (3)
at our option, Default Interest, if any, on the amounts referred to in the immediately preceding clauses (1) and/or (2) plus (4)
at Hanover Holdings I, LLC’s option, any amounts owed to Hanover Holdings I, LLC under the note. Unless otherwise agreed
in writing by both parties, at no time will Hanover Holdings I, LLC convert any amount of the note into common stock that would
result in Hanover Holdings I, LLC owning more than 4.99 percent of the common stock outstanding of the registrant.
The conversion price (the “Conversion
Price”) shall be the Variable Conversion Price (subject to equitable adjustments for stock splits, stock dividends or rights
offerings by Mind Solutions relating to our securities or the securities of any subsidiary of Mind Solutions, combinations, recapitalization,
reclassifications, extraordinary distributions and similar events). The “Variable Conversion Price” shall mean 55 percent
multiplied by the Market Price (as defined in the note). “Market Price” means the lowest Trading Price (as defined
below) for our common stock during the 10 Trading Day period ending on the latest complete Trading Day prior to the Conversion
Date. “Trading Price” means, for any security as of any date, the lowest trading price on the Over-the-Counter Bulletin
Board, or applicable trading market (the “OTCBB”) as reported by a reliable reporting service (“Reporting Service”)
mutually acceptable to Mind Solutions and Hanover Holdings I, LLC (i.e., Bloomberg). If the Trading Price cannot be calculated
for such security on such date in the manner provided above, the Trading Price shall be the fair market value as mutually determined
by Mind Solutions and the holders of a majority in interest of the notes being converted for which the calculation of the Trading
Price is required in order to determine the Conversion Price of such notes.
“Trading Day” shall mean
any day on which our common stock is traded for any period on the OTCBB, or on the principal securities exchange or other securities
market on which our common stock is then being traded. If our common stock is chilled for deposit at DTC and/or becomes chilled
at any point while the note remains outstanding, an additional eight percent discount will be attributed to the Conversion Price
defined in the note. If Mind Solutions is unable to issue any shares under this provision due to the fact that there is an insufficient
number of authorized and unissued shares available, Hanover Holdings I, LLC promises not to force Mind Solutions to issue these
shares or trigger an Event of Default, provided that Mind Solutions takes immediate steps required to get the appropriate level
of approval from stockholders or the board of directors, where applicable to raise the number of authorized shares to satisfy the
Notice of Conversion.
All shares of our common stock issued
to Hanover Holdings I, LLC that were issued or will be issued will be free of any restrictions pursuant to Rule 144 under the Securities
Act. In addition, all shares of our common stock which were issued or will be issued to Hanover Holdings I, LLC have been adjusted
to take into account the one for 2,000 reverse split of the shares of our common stock which occurred on October 31, 2013.
The note further provides for anti-dilution
adjustments in favor of Hanover Holdings I, LLC, in the event we offer additional shares of our common stock.
Copies of the Securities
Purchase Agreements and convertible notes in favor of Hanover Holdings I, LLC were filed as exhibits with the SEC.
Asher Enterprises, Inc. Financing.
In 2012, 2013, and 2014, we executed various Securities Purchase Agreements with Asher Enterprises, Inc., whereby we issued convertible
promissory notes to Asher Enterprises, Inc. bearing interest on the unpaid balance at the rate of eight percent, as follows:
| · | Convertible promissory note dated December 26, 2012, in the original principal amount of $32,500.
As a result of a conversion of the note, we issued 44,402 shares of our common stock to Asher Enterprises, Inc. As of the date
of this report, the note is paid in full. |
| · | Convertible promissory note dated March 1, 2013, in the original principal amount of $32,500.
As a result of a conversion of the note, we issued 583,992 shares of our common stock to Asher Enterprises, Inc. As of the date
of this report, the note is paid in full. |
| · | Convertible promissory note dated April 18, 2013, in the original principal amount of $32,500.
As a result of a conversion of the note, we issued 10,836,925 shares of our common stock to Asher Enterprises, Inc. As of the date
of this report, the note is paid in full. |
| · | Convertible promissory note dated November 7, 2013, in the original principal amount of $42,500.
As of the date of this report, the note is paid in full. |
| · | Convertible promissory note dated February 6, 2014, in the original principal amount of $37,500.
As of the date of this report, the note is paid in full. |
Each of the notes was convertible into
shares of our common stock by dividing the Conversion Amount (as defined below) by the applicable Conversion Price then in effect
on the date specified in the notice of conversion. The term “Conversion Amount” means, with respect to any conversion
of a note, the sum of (1) the principal amount of the note to be converted in such conversion plus (2) at Asher Enterprises, Inc.’s
option, accrued and unpaid interest, if any, on such principal amount at the interest rates provided in the note to the Conversion
Date; provided, however, that Mind Solutions shall have the right to pay any or all interest in cash plus (3) at our option, Default
Interest, if any, on the amounts referred to in the immediately preceding clauses (1) and/or (2) plus (4) at Asher Enterprises,
Inc.’s option, any amounts owed to Asher Enterprises, Inc. under the note. Unless otherwise agreed in writing by both parties,
at no time will Asher Enterprises, Inc. convert any amount of the note into common stock that would result in Asher Enterprises,
Inc. owning more than 4.99 percent of the common stock outstanding of the registrant.
The conversion price (the “Conversion
Price”) shall be the Variable Conversion Price (subject to equitable adjustments for stock splits, stock dividends or rights
offerings by Mind Solutions relating to our securities or the securities of any subsidiary of Mind Solutions, combinations, recapitalization,
reclassifications, extraordinary distributions and similar events). The “Variable Conversion Price” shall mean 55 percent
multiplied by the Market Price (as defined in the note) but in no event shall the Conversion Price be less than $0.00004. “Market
Price” means the lowest Trading Price (as defined below) for our common stock during the 10 Trading Day period ending on
the latest complete Trading Day prior to the Conversion Date. “Trading Price” means, for any security as of any date,
the lowest trading price on the Over-the-Counter Bulletin Board, or applicable trading market (the “OTCBB”) as reported
by a reliable reporting service (“Reporting Service”) mutually acceptable to Mind Solutions and Asher Enterprises,
Inc. (i.e., Bloomberg). If the Trading Price cannot be calculated for such security on such date in the manner provided
above, the Trading Price shall be the fair market value as mutually determined by Mind Solutions and the holders of a majority
in interest of the notes being converted for which the calculation of the Trading Price is required in order to determine the Conversion
Price of such notes.
“Trading Day” shall
mean any day on which our common stock is traded for any period on the OTCBB, or on the principal securities exchange or
other securities market on which our common stock is then being traded. If our common stock is chilled for deposit at DTC
and/or becomes chilled at any point while the note remains outstanding, an additional eight percent discount will be
attributed to the Conversion Price defined in the note. If Mind Solutions is unable to issue any shares under this provision
due to the fact that there is an insufficient number of authorized and unissued shares available, Asher Enterprises, Inc.
promises not to force Mind Solutions to issue these shares or trigger an Event of Default, provided that Mind Solutions takes
immediate steps required to get the appropriate level of approval from stockholders or the board of directors, where
applicable to raise the number of authorized shares to satisfy the Notice of Conversion.
All shares of our common stock issued
to Asher Enterprises, Inc. that were issued or will be issued will be free of any restrictions pursuant to Rule 144 under the Securities
Act. In addition, all shares of our common stock which were issued or will be issued to Asher Enterprises, Inc. have been adjusted
to take into account the one for 2,000 reverse split of the shares of our common stock which occurred on October 31, 2013.
The note further provides for anti-dilution
adjustments in favor of Asher Enterprises, Inc., in the event we offer additional shares of our common stock.
Copies of the Securities
Purchase Agreements and convertible notes in favor of Asher Enterprises, Inc. were filed as exhibits with the SEC.
JMJ Financial Financing.
On May 15, 2013, we executed a convertible promissory note in favor of JMJ Financial in the amount up to $250,000 bearing interest
on the unpaid balance at the rate of 12 percent. While the note was in the original principal amount of $250,000, it was only partially
funded on May 15, 2013, over six months ago, in the amount of $30,000.00, plus pro-rated original issue discount and pro-rated
interest in the amount of $7,333.33, on August 14, 2013, over six months ago, in the amount of $20,000.00, plus pro-rated original
issue discount and pro-rated interest in the amount of $4,888.89, on December 10, 2013, over six months ago, in the amount of $25,000,
plus pro-rated original issue discount and pro-rated interest in the amount of $6,111.11, on April 16, 2014, less than six months
ago, in the amount of $40,000, plus pro-rated original issue discount and pro-rated interest in the amount of $9,777.77, on June
24, 2014, over six months ago, in the amount of $60,000, plus pro-rated original issue discount and pro-rated interest in the amount
of $14,666.67 and on December 16, 2014, less than six months ago, in the amount of $25,000.00, plus pro-rated original issue discount
and pro-rated interest of $6,110. After allowing for previous conversions, $31,111 remains unpaid on the note on the date of this
report.
The Conversion Price of
the note is 60 percent of the lowest trade price in the 25 trading days previous to the conversion (In the case that conversion
shares are not deliverable by DWAC an additional 10 percent discount will apply; and if the shares are ineligible for deposit into
the DTC system and only eligible for )(clearing deposit an additional five percent discount shall apply; in the case of both an
additional cumulative 15 percent discount shall apply). Unless otherwise agreed in writing by both parties, at no time will JMJ
Financial convert any amount of the note into common stock that would result in JMJ Financial owning more than 4.99 percent of
the common stock outstanding of the registrant.
JMJ Financial has the
right, at any time after 180 days from the effective date of the note, at its election, to convert all or part of the outstanding
and unpaid principal sum and accrued interest (and any other fees) into shares of fully paid and non-assessable shares of common
stock of the registrant as per this conversion formula: Number of shares receivable upon conversion equals the dollar conversion
amount divided by the Conversion Price.
As of the date of this
report, $31,111 of the JMJ Financial note remains unpaid.
All shares of our common stock issued
to JMJ Financial that were issued or will be issued will be free of any restrictions pursuant to Rule 144 under the Securities
Act. In addition, all shares of our common stock which were issued or will be issued to JMJ Financial have been adjusted to take
into account the one for 2,000 reverse split of the shares of our common stock which occurred on October 31, 2013.
The note further provides for anti-dilution
adjustments in favor of JMJ Financial, in the event we offer additional shares of our common stock.
A copy of the convertible
promissory note in favor of JMJ Financial was filed as an exhibit with the SEC.
LG Capital Funding, LLC Financing.
Throughout 2014, we executed multiple Securities Purchase Agreements with LG Capital Funding, LLC, whereby we issued convertible
promissory notes in to LG Capital Funding, LLC bearing interest on the unpaid balance at the rate of 10 percent. They are as follows:
| · | Convertible promissory note dated February 4, 2014, in the original principal amount of $25,000.
On February 25, 2014, we issued a $25,000 convertible note with interest of 10 percent per annum, unsecured, and due February 25,
2015. The note is convertible into shares of our common stock at any time from the date of issuance at a conversion rate of 55
percent of the market price, calculated as the lowest trading price in the previous 10 days leading up to the date of conversion. |
| · | On March 25, 2014, we executed a Securities Purchase Agreement with LG Capital Funding, LLC,
whereby we issued a convertible promissory note in the amount of $40,000 to LG Capital Funding, LLC bearing interest on the unpaid
balance at the rate of 10 percent. On March 25, 2014, we issued a $40,000 convertible note unsecured and due February 25, 2015.
The note is convertible into shares of our common stock at any time from the date of issuance at a conversion rate of 55 percent
of the market price, calculated as the lowest trading price in the previous 10 days leading up to the date of conversion. |
| · | On August 7, 2014, we executed a Securities Purchase Agreement with LG Capital Funding, LLC,
whereby we issued a convertible promissory note in the amount of $25,000 to LG Capital Funding, LLC bearing interest on the unpaid
balance at the rate of 10 percent. On August 7, 2014, we issued a $25,000 convertible note unsecured and due August 7, 2015. The
note is convertible into shares of our common stock at any time from the date of issuance at a conversion rate of 55 percent of
the market price, calculated as the lowest trading price in the previous 10 days leading up to the date of conversion. |
| · | On September 4, 2014, we executed a Securities Purchase Agreement with LG Capital Funding, LLC,
whereby we issued a convertible promissory note in the amount of $31,500 to LG Capital Funding, LLC bearing interest on the unpaid
balance at the rate of 10 percent. On September 4, 2014, we issued a $31,500 convertible note unsecured and due September 4, 2015.
The note is convertible into shares of our common stock at any time from the date of issuance at a conversion rate of 55 percent
of the market price, calculated as the lowest trading price in the previous 10 days leading up to the date of conversion. |
| · | On February 10, 2015, we executed a Securities Purchase Agreement with LG Capital Funding, LLC,
whereby we issued a convertible promissory note in the amount of $31,500 to LG Capital Funding, LLC bearing interest on the unpaid
balance at the rate of 10 percent. On February 10, 2015, we issued a $31,500 convertible note unsecured and due September 4, 2015.
The note is convertible into shares of our common stock at any time from the date of issuance at a conversion rate of 55 percent
of the market price, calculated as the lowest trading price in the previous 10 days leading up to the date of conversion. |
As of the date of this
report, $64,000 of the LG Capital Funding, LLC note remains unpaid.
Copies of the Securities
Purchase Agreements and the convertible promissory notes in favor of LG Capital Funding, LLC executed prior to February 10, 2015,
were filed as exhibits with the SEC. Copies of the Securities Purchase Agreement with LG Capital Funding, LLC dated February 10,
2015, and the convertible promissory note in the amount of $31,500 in favor of LG Capital Funding, LLC are filed as exhibits with
this report.
GEL Properties, LLC Financing.
Throughout 2014, we executed multiple convertible promissory notes to GEL Properties, LLC bearing interest on the unpaid balance
at the rate of 10 percent. They are as follows:
| · | On February 4, 2014, we issued a convertible promissory note to GEL Properties, LLC bearing interest
on the unpaid balance at the rate of 10 percent, in the original principal amount of $25,000. The note is unsecured, and due February
4, 2015, and is convertible into shares of our common stock at any time from the date of issuance at a conversion rate of 55 percent
of the market price, calculated as the lowest trading price in the previous 10 days leading up to the date of conversion. |
| · | On August 28, 2014, we issued a convertible promissory note to GEL Properties, LLC bearing interest
on the unpaid balance at the rate of 10 percent, in the original principal amount of $25,000. The note is unsecured, and due August
28, 2015, and is convertible into shares of our common stock at any time from the date of issuance at a conversion rate of 55 percent
of the market price, calculated as the lowest trading price in the previous 10 days leading up to the date of conversion. |
As of the date
of this report, $0 of the notes remain unpaid to GEL Properties, LLC.
A copy of the convertible
promissory notes in favor of GEL Properties, LLC was filed as an exhibit with the SEC.
Premier Venture Partners, LLC Financing.
On March 11, 2013, Mind Solutions and Premier Venture Partners, LLC, a California Limited Partnership executed that certain Equity
Purchase Agreement with respect to the resale of up to 200,000,000 shares of our common stock by Premier pursuant to a “put
right.” The Equity Purchase Agreement permitted us to “put” up to $1,000,000 in shares of our common stock to
Premier. Moreover, we also agreed to register the resale by Premier of an additional 12,765,957 shares of our common stock issued
as Initial Commitment Shares in connection with the Equity Purchase Agreement. We were not to receive any proceeds from the sale
of the shares of our common stock offered by Premier. However, we were to receive proceeds from the sale of securities pursuant
to our exercise of the put right described in the Equity Purchase Agreement. We agreed to bear all costs associated with the registration.
We filed with the SEC a current report
on Form 8-K with respect to the Premier Equity Purchase Agreement on March 26, 2014.
On June 27, 2014, we filed a registration
statement on Form S-1 in connection with the Premier Equity Purchase Agreement. However, on July 17, 2014, pursuant to Rule 477
of Regulation C promulgated under the Securities Act, we withdrew our registration statement, inasmuch as we received notice from
the Securities and Exchange Commission on July 3, 2014, that the Commission’s preliminary review of the registration statement
indicated that we were not entitled to file the registration statement for our equity line financing, inasmuch as the shares of
our common stock are quoted for sale on the OTCPK operated by OTC Market Group, Inc. No securities were sold in connection with
the registration statement. On September 10, 2014, we filed a Form 8-K/A announcing that we had terminated the Premier Equity Purchase
Agreement.
Caesar Capital Group LLC Financing.
On April 15, 2014, we executed a Securities Purchase Agreement and convertible promissory note in the amount of $50,000 with Caesar
Capital Group LLC with eight percent interest per annum, due April 15, 2015. The note holder has the right to convert the note
into shares of our common stock after six months from the date of the executed note at a discount to market of 45 percent based
on the lowest trading price ten days prior to conversion.
As of the date of this report, $0 of
the note remains unpaid to Caesar Capital Group LLC.A copy of the Securities Purchase Agreement and the convertible promissory
note in favor of Caesar Capital Group LLC was filed as an exhibit with the SEC.
ARRG Corp. Financing. On
April 30, 2014, we executed a Securities Purchase Agreement and convertible promissory note in the amount of $50,000 with ARRG
Corp. with eight percent interest per annum, due April 30, 2015. The note holder has the right to convert the note into shares
of our common stock after six months from the date of the executed note at a discount to market of 45 percent based on the lowest
trading price 10 days prior to conversion.
As of the date of this report, $0 of
the note remains unpaid to ARRG Corp.
A copy of the Securities
Purchase Agreement and the convertible promissory note in favor of ARRG Corp. was filed as an exhibit with the SEC.
Cicero Consulting Group, LLC Financing.
On May 12, 2014, we executed a Consulting Agreement with Cicero Consulting Group, LLC and convertible promissory note in the amount
of $200,000 whereby Cicero Consulting Group, LLC will provide management consulting and business advisory services to Mind Solutions
over a one year term. We have compensated Cicero Consulting Group, LLC with a $200,000 convertible promissory note which is considered
earned in full as of May 12, 2014. The convertible note issued pursuant to the Consulting Agreement may be converted into shares
of our common stock after six months from the date of the executed note at a 10 percent discount to market based on the lowest
trading price during the 10 trading days prior to the conversion date.
As of the date of this report, $100,000
of the note remains unpaid to Cicero Consulting Group, LLC
A copy of the Consulting
Agreement and the convertible promissory note in favor of Cicero Consulting Group, LLC was filed as an exhibit with the SEC.
KBM Worldwide, Inc. Financing.
On May 8, 2014, we executed a Securities Purchase Agreement with KBM Worldwide, Inc., whereby we issued a convertible promissory
note dated May 8, 2014, to KBM Worldwide, Inc. bearing interest on the unpaid balance at the rate of eight percent, in the original
principal amount of $42,500.
The note is convertible into shares of
our common stock by dividing the Conversion Amount (as defined below) by the applicable Conversion Price then in effect on the
date specified in the notice of conversion. The term “Conversion Amount” means, with respect to any conversion of a
note, the sum of (1) the principal amount of the note to be converted in such conversion plus (2) at KBM Worldwide, Inc.’s
option, accrued and unpaid interest, if any, on such principal amount at the interest rates provided in the note to the Conversion
Date; provided, however, that Mind Solutions shall have the right to pay any or all interest in cash plus (3) at our option, Default
Interest, if any, on the amounts referred to in the immediately preceding clauses (1) and/or (2) plus (4) at KBM Worldwide, Inc.’s
option, any amounts owed to KBM Worldwide, Inc. under the note.
The conversion price (the “Conversion
Price”) shall be the Variable Conversion Price (subject to equitable adjustments for stock splits, stock dividends or rights
offerings by Mind Solutions relating to our securities or the securities of any subsidiary of Mind Solutions, combinations, recapitalization,
reclassifications, extraordinary distributions and similar events). The “Variable Conversion Price” shall mean 51 percent
multiplied by the Market Price (as defined in the note). “Market Price" means the average of the lowest three Trading
Prices (as defined below) for our common stock during the 30 Trading Day period ending on the latest complete Trading Day prior
to the Conversion Date. “Trading Price” means, for any security as of any date, the lowest trading price on the Over-the-Counter
Bulletin Board, or applicable trading market (the “OTCBB”) as reported by a reliable reporting service (“Reporting
Service”) mutually acceptable to Mind Solutions and KBM Worldwide, Inc. (i.e., Bloomberg). If the Trading Price cannot
be calculated for such security on such date in the manner provided above, the Trading Price shall be the fair market value as
mutually determined by Mind Solutions and the holders of a majority in interest of the note being converted for which the calculation
of the Trading Price is required in order to determine the Conversion Price of such note.
“Trading Day” shall mean
any day on which shares of our common stock are tradable for any period on the OTC, or on the principal securities exchange or
other securities market on which shares of our common stock are then being traded.
All shares of our common stock to be
issued to KBM Worldwide, Inc. are to be issued free of any restrictions pursuant to Rule 144 under the Securities Act.
The note further provides for anti-dilution
adjustments in favor of KBM Worldwide, Inc., in the event we offer additional shares of our common stock.
Copies of the Securities
Purchase Agreement and convertible note in favor of KBM Worldwide, Inc. were filed as exhibits with the SEC.
Additional KBM Worldwide, Inc. Financing.
On July 22, 2014, we executed a Securities Purchase Agreement with KBM Worldwide, Inc., whereby we issued a convertible promissory
note dated July 22, 2014, to KBM Worldwide, Inc. bearing interest on the unpaid balance at the rate of eight percent, in the original
principal amount of $27,500.
Additional KBM Worldwide, Inc. Financing.
On October 29, 2014, we executed a Securities Purchase Agreement with KBM Worldwide, Inc., whereby we issued a convertible promissory
note dated October 29, 2014, to KBM Worldwide, Inc. bearing interest on the unpaid balance at the rate of eight percent, in the
original principal amount of $32,500.The notes are convertible into shares of our common stock by dividing the Conversion Amount
(as defined below) by the applicable Conversion Price then in effect on the date specified in the notice of conversion. The term
“Conversion Amount” means, with respect to any conversion of a note, the sum of (1) the principal amount of the note
to be converted in such conversion plus (2) at KBM Worldwide, Inc.’s option, accrued and unpaid interest, if any, on such
principal amount at the interest rates provided in the note to the Conversion Date; provided, however, that Mind Solutions shall
have the right to pay any or all interest in cash plus (3) at our option, Default Interest, if any, on the amounts referred to
in the immediately preceding clauses (1) and/or (2) plus (4) at KBM Worldwide, Inc.’s option, any amounts owed to KBM Worldwide,
Inc. under the note.
The conversion price (the “Conversion
Price”) shall be the Variable Conversion Price (subject to equitable adjustments for stock splits, stock dividends or rights
offerings by Mind Solutions relating to our securities or the securities of any subsidiary of Mind Solutions, combinations, recapitalization,
reclassifications, extraordinary distributions and similar events). The “Variable Conversion Price” shall mean 51 percent
multiplied by the Market Price (as defined in the note). “Market Price" means the average of the lowest three Trading
Prices (as defined below) for our common stock during the 30 Trading Day period ending on the latest complete Trading Day prior
to the Conversion Date. “Trading Price” means, for any security as of any date, the closing bid price on the Over-the-Counter
Bulletin Board, Pink Sheets electronic quotation system or applicable trading market (the “OTC”) as reported by a reliable
reporting service (“Reporting Service”) designated by the Holder (i.e. Bloomberg) or, if the OTC is not the principal
trading market for such security, the closing bid price of such security on the principal securities exchange or trading market
where such security is listed or traded or, if no closing bid price of such security is available in any of the foregoing manners,
the average of the closing bid prices of any market makers for such security that are listed in the “pink sheets.”
If the Trading Price cannot be calculated for such security on such date in the manner provided above, the Trading Price shall
be the fair market value as mutually determined by Mind Solutions and the holders of a majority in interest of the note being converted
for which the calculation of the Trading Price is required in order to determine the Conversion Price of such note.
“Trading Day” shall mean
any day on which shares of our common stock are tradable for any period on the OTC, or on the principal securities exchange or
other securities market on which shares of our common stock are then being traded.
All shares of our common stock to be
issued to KBM Worldwide, Inc. are to be issued free of any restrictions pursuant to Rule 144 under the Securities Act.
The note further provides for anti-dilution
adjustments in favor of KBM Worldwide, Inc., in the event we offer additional shares of our common stock.
As of the date of this report, $32,500
of the note outstanding with KBM Worldwide, Inc. remains unpaid.
Copies of the Securities Purchase Agreement
and convertible note in favor of KBM Worldwide, Inc. were filed as exhibits with the SEC.
WHC Capital, LLC Financing. On
May 30, 2014, we executed a Securities Purchase Agreement and convertible promissory note in the amount of $60,000 with WHC Capital,
LLC with 12 percent interest per annum, due May 30, 2015. The note holder has the right to convert the note into shares of our
common stock after six months from the date of the executed note at a discount to market of 50 percent based on the lowest trading
price 10 days prior to conversion.
All shares of our common stock to be
issued to WHC Capital, LLC upon conversion of the note will be free of any restrictions pursuant to Rule 144 under the Securities
Act.
As of the date of this
report, $0 of the WHC Capital, LLC note remains unpaid.
Copies of the Securities
Purchase Agreement and convertible note in favor of WHC Capital, LLC are filed as exhibits to this report.
Iconic Holdings, LLC Financing.
On February 18, 2014, we executed a Note Purchase Agreement with Iconic Holdings, LLC, whereby we issued a convertible promissory
note dated February 18, 2014, to Iconic Holdings, LLC bearing interest on the unpaid balance at the rate of 10 percent, in the
original principal amount of $220,000. The note is convertible into shares of the Company’s stock at a 45% discount from
the lowest trading price in the (10) ten days prior to conversion. As of the date of this filing, only $132,500 of principle has
been funded which includes original issue discount of $13,250.
The initial funding on February 25, 2014,
was in the amount of $27,500 with $2,750 of original issue discount. The sum of $25,000 was delivered to Mind Solutions, and $2,500
was retained by Iconic Holdings for original issue discount and due diligence and legal bills related to this note.
Additional Iconic Holdings, LLC Financing.
An additional funding on September 25, 2014, was in the amount of $27,500 with $2,750 of original issue discount. The sum of $25,000
was delivered to Mind Solutions, and $2,500 was retained by Iconic Holdings for original issue discount and due diligence and legal
bills related to this note.
Additional Iconic Holdings, LLC Financing.
An additional funding on November 4, 2014, was in the amount of $27,500 with $2,750 of original issue discount. The sum of $25,000
was delivered to Mind Solutions, and $2,500 was retained by Iconic Holdings for original issue discount and due diligence and legal
bills related to this note.
Additional Iconic Holdings, LLC Financing.
An additional funding on February 4, 2015, was in the amount of $50,000 with $5,000 of original issue discount. The sum of $50,000
was delivered to Mind Solutions, and $5,000 was retained by Iconic Holdings for original issue discount and due diligence and legal
bills related to this note
Iconic reserves the right to pay additional
consideration on the note at any time and in any amount it desires, at its sole discretion. Mind Solutions is not responsible to
repay any unfunded portion of the note. The note may not be prepaid in whole or in part except as otherwise provided therein.
Conversion Right. Subject to the
terms of the note, Iconic shall have the right, at Iconic's option, at any time to convert the outstanding principal amount and
interest under the note in whole or in part.
Stock Certificates or DWAC. Mind
Solutions will deliver to Iconic, or Iconic’s authorized designee, no later than two Trading Days after the Conversion Date,
a certificate or certificates (which certificate(s) shall be free of restrictive legends and trading restrictions) representing
the number of shares of common stock being acquired upon the conversion of the note. In lieu of delivering physical certificates
representing the shares of common stock issuable upon conversion of the note, provided Mind Solutions' transfer agent is participating
in the DTC Fast Automated Securities Transfer (“FAST”) program, upon request of Iconic, Mind Solutions shall use commercially
reasonable efforts to cause its transfer agent to electronically transmit such shares issuable upon conversion to Iconic (or its
designee), by crediting the account of Iconic’s (or such designee’s) prime broker with DTC through its Deposits and
Withdrawal at Custodian (DWAC) program (provided that the same time periods herein as for stock certificates shall apply).
Reservation and Issuance of
Underlying Securities. Mind Solutions covenants that it will at all times reserve and keep available out of its
authorized and unissued common stock solely for the purpose of issuance upon conversion of the note (including repayments in
stock), free from preemptive rights or any other actual contingent purchase rights of persons other than Iconic, not less
than three times (3x) the number of shares of common stock as shall be issuable (taking into account the adjustments under
the note but without regard to any ownership limitations contained therein) upon the conversion of the note into common
stock. These shares shall be reserved in proportion with the Consideration actually received by Mind Solutions and the total
reserve will be increased with future payments of consideration by Iconic. Mind Solutions covenants that all shares of common
stock that shall be issuable will, upon issue, be duly authorized, validly issued, fully-paid, non-assessable and
freely-tradable. Mind Solutions agrees that this is a material term of the note.
Conversion Limitation. Iconic
will not submit a conversion to Mind Solutions that would result in Iconic owning more than 9.99% of the total outstanding shares
of Mind Solutions.
As of the date of this report, $118,250
of the note remains unpaid to Iconic Holdings, LLC. Copies of the Note Purchase Agreement and convertible note in favor of Iconic
Holdings, LLC were filed as exhibits with the SEC.
On September 22, 2014, the registrant
entered into a Convertible Note Agreement with JSJ Investments Inc. The registrant issued a $100,000 convertible note with interest
of 12% per annum, unsecured, and due March 22, 2015. The note is convertible into common shares of the registrant at any time from
the date of issuance at a conversion rate of 48% discount to the market price, calculated as the average of the three lowest trading
prices in the previous 20 trading days leading up to the date of conversion. As of December 31, 2014, JSJ Investments Inc. has
not converted any principle on this note.
As of the date of this report, $100,000
of the note remains unpaid to JSJ Investments, Inc.
Copies of the Note Purchase Agreement
and convertible note in favor of JSJ Investments, Inc. were filed as exhibits with the SEC.
Critical Accounting Policies
Our financial statements and accompanying
notes are prepared in accordance with generally accepted accounting principles in the United States. Preparing financial statements
requires management to make estimates and assumptions that impact the reported amounts of assets, liabilities, revenue, and expenses.
These estimates and assumptions are affected by management’s application of accounting policies. Critical accounting policies
include revenue recognition and impairment of long-lived assets.
We recognize revenue in accordance with
Staff Accounting Bulletin No. 101, “Revenue Recognition in Financial Statements.” Sales are recorded when products
are shipped to customers. Provisions for discounts and rebates to customers, estimated returns and allowances and other adjustments
are provided for in the same period the related sales are recorded.
We evaluate our long-lived assets for
financial impairment on a regular basis in accordance with Statement of Financial Accounting Standards No. 144, “Accounting
for the Impairment or Disposal of Long-Lived Assets” which evaluates the recoverability of long-lived assets not held for
sale by measuring the carrying amount of the assets against the estimated discounted future cash flows associated with them. At
the time such evaluations indicate that the future discounted cash flows of certain long-lived assets are not sufficient to recover
the carrying value of such assets, the assets are adjusted to their fair values.
Quantitative and Qualitative Disclosures
About Market Risk
We conduct all of our transactions, including
those with foreign suppliers and customers, in U.S. dollars. We are therefore not directly subject to the risks of foreign currency
fluctuations and do not hedge or otherwise deal in currency instruments in an attempt to minimize such risks. Demand from foreign
customers and the ability or willingness of foreign suppliers to perform their obligations to us may be affected by the relative
change in value of such customer or supplier’s domestic currency to the value of the U.S. dollar. Furthermore, changes in
the relative value of the U.S. dollar may change the price of our products relative to the prices of our foreign competitors.
Stock-Based Compensation
We recognize compensation cost for stock-based
awards based on the estimated fair value of the award on date of grant. We measure compensation cost at the grant date based on
the fair value of the award and recognize compensation cost upon the probable attainment of a specified performance condition or
over a service period.
Recently Issued Accounting Pronouncements
In October 2012, the Financial Accounting
Standards Board (FASB) issued Accounting Standards Update (ASU) 2012-04, “Technical Corrections and Improvements” in
Accounting Standards Update No. 2012-04. The amendments in this update cover a wide range of Topics in the Accounting Standards
Codification. These amendments include technical corrections and improvements to the Accounting Standards Codification and conforming
amendments related to fair value measurements. The amendments in this update were effective for fiscal periods beginning after
December 15, 2012. The adoption of ASU 2012-04 is not expected to have a material impact on our financial position or results of
operations.
In August 2012, the FASB issued ASU 2012-03,
“Technical Amendments and Corrections to SEC Sections: Amendments to SEC Paragraphs Pursuant to SEC Staff Accounting Bulletin
(SAB) No. 114, Technical Amendments Pursuant to SEC Release No. 33-9250, and Corrections Related to FASB Accounting Standards Update
2010-22 (SEC Update)” in Accounting Standards Update No. 2012-03. This update amends various SEC paragraphs pursuant to the
issuance of SAB No. 114. The adoption of ASU 2012-03 is not expected to have a material impact on our financial position or results
of operations.
In July 2012, the FASB issued ASU 2012-02,
“Intangibles – Goodwill and Other (Topic 350): Testing Indefinite-Lived Intangible Assets for Impairment” in
Accounting Standards Update No. 2012-02. This update amends ASU 2011-08, Intangibles – Goodwill and Other (Topic 350): Testing
Indefinite-Lived Intangible Assets for Impairment and permits an entity first to assess qualitative factors to determine whether
it is more likely than not that an indefinite-lived intangible asset is impaired as a basis for determining whether it is necessary
to perform the quantitative impairment test in accordance with Subtopic 350-30, Intangibles - Goodwill and Other - General Intangibles
Other than Goodwill. The amendments are effective for annual and interim impairment tests performed for fiscal years beginning
after September 15, 2012. Early adoption is permitted, including for annual and interim impairment tests performed as of a date
before July 27, 2012, if a public entity’s financial statements for the most recent annual or interim period have not yet
been issued or, for nonpublic entities, have not yet been made available for issuance. The adoption of ASU 2012-02 is not expected
to have a material impact on our financial position or results of operations.
In December 2011, the FASB issued ASU
2011-12, “Deferral of the Effective Date for Amendments to the Presentation of Reclassifications of Items out of Accumulated
Other Comprehensive Income in Accounting Standards Update No. 2011-05. This update defers the requirement to present items that
are reclassified from accumulated other comprehensive income to net income in both the statement of income where net income is
presented and the statement where other comprehensive income is presented. The adoption of ASU 2011-12 is not expected to have
a material impact on our financial position or results of operations.
In December 2011, the FASB issued ASU
No. 2011-11 “Balance Sheet: Disclosures about Offsetting Assets and Liabilities” (“ASU 2011-11”). This
Update requires an entity to disclose information about offsetting and related arrangements to enable users of its financial statements
to understand the effect of those arrangements on its financial position. The objective of this disclosure is to facilitate comparison
between those entities that prepare their financial statements on the basis of U.S. GAAP and those entities that prepare their
financial statements on the basis of IFRS. The amended guidance is effective for annual reporting periods beginning on or after
January 1, 2013, and interim periods within those annual periods. We are currently evaluating the impact, if any, that the adoption
of this pronouncement may have on our results of operations or financial position.
Off-Balance Sheet Arrangements
We do not have any off-balance sheet
arrangements.
Subsequent Events
See “Item 7. Management’s
Discussion and Analysis of Financial Condition and Results of Operations – Financing Activities.”
Item 7A. Quantitative
and Qualitative Disclosures About Market Risk.
Not applicable.
Item 8. Financial Statements
and Supplementary Data.
The financial statements and related
notes are included as part of this report as indexed in the appendix on page F-1, et seq.
Item 9. Changes in and
Disagreements with Accountants on Accounting and Financial Disclosure.
During the last two fiscal years, we
have had no disagreements with our accountants on accounting and financial disclosure.
Resignation of Certifying Accountants.
On January 20, 2014, we accepted the resignation of Patrick Rodgers, CPA, P.A. (“Rodgers”) from his engagement to be
the independent certifying accountant for Mind Solutions, which resignation was reported in our current report on Form 8-K filed
on January 21, 2014, and on Form 8-K/A filed on March 17, 2014.
Effective March 6, 2014, the Public
Company Accounting Oversight Board (“PCAOB”) revoked the registration of Rodgers due to its violations of PCAOB
rules and auditing standards in auditing the financial statements and PCAOB rules and quality control standards with respect
to Rodgers’ clients; Mind Solutions was not one of the clients for which Rodgers was sanctioned. You can find a copy of
the order at http://pcaobus.org/Enforcement/Decisions/Documents/2014_Rodgers.pdf.
Other than an explanatory paragraph included
in Rodgers’ audit report for our fiscal year ended December 31, 2012, relating to the uncertainty of our ability to continue
as a going concern, the audit report of Rodgers on our financial statements for the last fiscal year ended December 31, 2012, through
January 20, 2014, did not contain an adverse opinion or a disclaimer of opinion, nor was it qualified or modified as to uncertainty,
audit scope or accounting principles.
During our fiscal year ending December
31, 2012, and through the date of the current report on Form 8-K and Form 8-K/A described above (i) there were no disagreements
with Rodgers on any matter of accounting principles or practices, financial statement disclosure, or auditing scope or procedure,
which, if not resolved to the satisfaction of Rodgers, would have caused Rodgers to make reference to the subject matter of the
disagreements in connection with their report; and (ii) there were no “reportable events” as that term is defined in
Item 304(a)(1)(v) of Regulation S-K.
The decision to dismiss Rodgers was recommended
by our board of directors.
During the two most recent fiscal years
and any subsequent interim period through January 20, 2014, there have not been any disagreements between us and Rodgers on any
matter of accounting principles or practices, financial statement disclosure, or auditing scope or procedure, which disagreements,
if not resolved to the satisfaction of Rodgers, would have caused it to make reference to the subject matter of the disagreements
in connection with its reports on the financial statements for such periods.
Engagement of New Certifying
Accountants. On January 20, 2014, we engaged Terry L. Johnson, CPA (“Johnson”) as our independent accountants
to report on our balance sheet as of December 31, 2013, and the related combined statements of income, stockholders’
equity and cash flows for the year then ended. The decision to appoint Johnson was approved by our board of directors. See
our current report on Form 8-K filed with the SEC on January 21, 2014.
During our two most recent fiscal years
and any subsequent interim period prior to the engagement of Johnson, neither we nor anyone on our behalf consulted with Johnson
regarding either (i) the application of accounting principles to a specified transaction, either completed or proposed; or the
type of audit opinion that might be rendered on our financial statements, and either a written report was provided to us or oral
advice was provided that the new accountant concluded was an important factor considered by us in reaching a decision as to the
accounting, auditing or financial reporting issue; or (ii) any matter that was either the subject of a disagreement (as defined
in paragraph 304(a)(1)(iv) and the related instructions to Regulation S-K) or a reportable event (as described in paragraph 304(a)(1)(v)
of Regulation S-K).
We provided Rodgers with a copy of the
disclosures we made in the above-described Form 8-K and Form 8-K/A, which Rodgers received no later than the day that the disclosures
were filed with the SEC. We requested that Rodgers furnish us with a letter addressed to the SEC stating whether it agreed with
the statements made by us in response to Item 304(a) of Regulation S-K, and, if not, stating the respects in which it did not agree.
Rodgers refused to provide such a letter.
The financial statements included in
this report were audited by Terry L. Johnson, CPA.
Item 9A. Controls and
Procedures.
See Item 9A(T) below.
Item 9A(T). Controls
and Procedures.
Evaluation of Disclosure and Controls
and Procedures. We carried out an evaluation, under the supervision and with the participation of our management, including
our principal executive officer and principal financial officer, of the effectiveness of our disclosure controls and procedures
(as defined) in Exchange Act Rules 13a – 15(c) and 15d – 15(e)). Based upon that evaluation, our chief executive officer
and chief financial officer concluded that, as of the end of the period ended December 31, 2014, our disclosure controls and procedures
were not effective (1) to ensure that information required to be disclosed by us in reports that we file or submit under the Exchange
Act is recorded, processed, summarized and reported, within the time periods specified in the SEC’s rules and forms and (2)
to ensure that information required to be disclosed by us in the reports that we file or submit under the Exchange Act is accumulated
and communicated to us, including our chief executive and chief financial officers, as appropriate to allow timely decisions regarding
required disclosure.
The term disclosure controls and procedures
means controls and other procedures of an issuer that are designed to ensure that information required to be disclosed by the issuer
in the reports that it files or submits under the Exchange Act (15 U.S.C. 78a, et seq.) is recorded, processed, summarized
and reported, within the time periods specified in the Commission’s rules and forms. Disclosure controls and procedures include,
without limitation, controls and procedures designed to ensure that information required to be disclosed by an issuer in the reports
that it files or submits under the Exchange Act is accumulated and communicated to the issuer’s management, including its
principal executive and principal financial officers, or persons performing similar functions, as appropriate to allow timely decisions
regarding required disclosure.
Our management, including our chief
executive officer and chief financial officer, does not expect that our disclosure controls and procedures or our internal controls
over financial reporting will prevent all error and all fraud. A control system, no matter how well conceived and operated, can
provide only reasonable, not absolute, assurance that the objectives of the control system are met. Further, the design of a control
system must reflect the fact that there are resource constraints, and the benefits of controls must be considered relative to their
costs. Because of inherent limitations in all control systems, internal control over financial reporting may not prevent or detect
misstatements, and no evaluation of controls can provide absolute assurance that all control issues and instances of fraud, if
any, within the registrant have been detected. Also, projections of any evaluation of effectiveness to future periods are subject
to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies
or procedures may deteriorate.
Management’s Annual Report
on Internal Control over Financial Reporting. Our management is responsible for establishing and maintaining adequate internal
control over financial reporting as defined in Rule 13a-15(f) under the Exchange Act. Our internal control over financial reporting
is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial
statements for external purposes in accordance with accounting principles generally accepted in the United States.
The term internal control over financial
reporting is defined as a process designed by, or under the supervision of, the issuer’s principal executive and principal
financial officers, or persons performing similar functions, and effected by the issuer’s board of directors, management
and other personnel, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial
statements for external purposes in accordance with generally accepted accounting principles and includes those policies and procedures
that:
| · | Pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect
the transactions and dispositions of our assets; |
| · | Provide reasonable assurance that transactions are recorded as necessary to permit preparation
of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the
issuer are being made only in accordance with authorizations of management and directors of the issuer; and |
| · | Provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition,
use or disposition of the issuer’s assets that could have a material effect on the financial statements. |
Our management assessed the effectiveness
of our internal control over financial reporting as of December 31, 2013. In making this assessment, our management used the criteria
set forth by the Committee of Sponsoring Organizations of the Treadway Commission (COSO) in Internal Control-Integrated Framework.
Changes in Internal Control Over
Financial Reporting. There have been no changes in the registrant’s internal control over financial reporting through
the date of this report or during the period ended December 31, 2013, that materially affected, or is reasonably likely to materially
affect, the registrant’s internal control over financial reporting.
Independent Registered Accountant’s
Internal Control Attestation. This report does not include an attestation report of the registrant’s registered public
accounting firm regarding internal control over financial reporting. Management’s report was not subject to attestation by
the registrant’s registered public accounting firm pursuant to temporary rules of the Securities and Exchange Commission
that permit the registrant to provide only management’s report in this report.
Remediation plans for material weaknesses
over internal controls. Our plans to mitigate material weaknesses in disclosure controls and procedures for future filings
will be dependent on our ability to obtain adequate financing to fund development of our financial reporting infrastructure. At
this time it is not cost beneficial for us to utilize capital to focus on mitigating financial reporting weaknesses; however, we
expect to implement a plan for remediation of these deficiencies when sufficient funding to implement such a plan is available.
Item 9B. Other Information.
None.
PART III
Item 10. Directors,
Executive Officers and Corporate Governance.
The following table sets forth information
concerning the directors and executive officers of Mind Solutions as of the date of this report:
Name |
Age |
Position |
Director Since |
Kerry Driscoll |
46 |
Chairman, Chief Executive Officer, President, Chief Financial Officer, Principal Accounting Officer, and Secretary |
2012 |
The members of our board of directors
are subject to change from time to time by the vote of the stockholders at special or annual meetings to elect directors. Our current
board of directors consists of one director, who has expertise in the proposed business of Mind Solutions. Upon receipt of sufficient
funds to pay for consultants as described elsewhere in this report either from revenues or through receipt of funds from debt or
sales of our common stock, we intend to seek directors and officers who would be able to properly execute our proposed business
plan.
The foregoing notwithstanding, except
as otherwise provided in any resolution or resolutions of the board, directors who are elected at an annual meeting of stockholders,
and directors elected in the interim to fill vacancies and newly created directorships, will hold office for the term for which
elected and until their successors are elected and qualified or until their earlier death, resignation or removal.
Whenever the holders of any class or
classes of stock or any series thereof are entitled to elect one or more directors pursuant to any resolution or resolutions of
the board, vacancies and newly created directorships of such class or classes or series thereof may generally be filled by a majority
of the directors elected by such class or classes or series then in office, by a sole remaining director so elected or by the unanimous
written consent or the affirmative vote of a majority of the outstanding shares of such class or classes or series entitled to
elect such director or directors. Officers are elected annually by the directors. There are no family relationships among our directors
and officers.
We may employ additional management personnel,
as our board of directors deems necessary. Mind Solutions has not identified or reached an agreement or understanding with any
other individuals to serve in management positions, but does not anticipate any problem in employing qualified staff.
A description of the business experience
for each of the directors and executive officers of Mind Solutions is set forth below.
Kerry Driscoll has served as a member
of our board of directors, our chief executive officer and our chief financial officer since October 2012. Mr. Driscoll graduated
from the University of Southern California where he received his B.S. in Business Administration through the Entrepreneur Program.
Mr. Driscoll has been involved with many start-ups since receiving his degree in 1991. Since 1997, he has been a principal at Driscoll
& Associates Insurance Services, Inc.
Committees of the Board
We do not currently
have an Audit, Executive, Finance, Compensation, or Nominating Committee, or any other committee of the board of directors. However,
we have adopted charters for these committees, in the event that we elect to implement them. Copies of the charters for each proposed
committee have been previously filed with the SEC.
The
responsibilities of these committees are fulfilled by our board of directors and all of our directors participate in such
responsibilities, none of whom is “independent” as defined under Rule 4200(a)(15) of the NASD’s listing
standards described below, as our financial constraints have made it extremely difficult to attract and retain qualified
independent board members. Since we do not have any of the subject committees, our entire board of directors participates in
all of the considerations with respect to our audit, compensation and nomination deliberations.
Rule 4200(a)(15) of the NASD’s
listing standards defines an “independent director” as a person other than an executive officer or employee of the
company or any other individual having a relationship which, in the opinion of the issuer’s board of directors, would interfere
with the exercise of independent judgment in carrying out the responsibilities of a director. The following persons shall not be
considered independent:
| · | A director who is, or at any time during the past three years was, employed by the company; |
| · | A director who accepted or who has a Family Member who accepted any compensation from the company
in excess of $120,000 during any period of twelve consecutive months within the three years preceding the determination of independence,
other than the following: (i) compensation for board or board committee service; (ii) compensation paid to a Family Member who
is an employee (other than as an executive officer) of the company; or (iii) benefits under a tax-qualified retirement plan, or
non-discretionary compensation. Provided, however, that in addition to the requirements contained in this paragraph, audit committee
members are also subject to additional, more stringent requirements under Rule 4350(d). |
| · | A director who is a Family Member of an individual who is, or at any time during the past three
years was, employed by the company as an executive officer; |
| · | A director who is, or has a Family Member who is, a partner in, or a controlling stockholder
or an executive officer of, any organization to which the company made, or from which the company received, payments for property
or services in the current or any of the past three fiscal years that exceed five percent of the recipient’s consolidated
gross revenues for that year, or $200,000, whichever is more, other than the following: (i) payments arising solely from investments
in the company’s securities; or (ii) payments under non-discretionary charitable contribution matching programs. |
| · | A director of the issuer who is, or has a Family Member who is, employed as an executive officer
of another entity where at any time during the past three years any of the executive officers of the issuer serve on the compensation
committee of such other entity; or |
| · | A director who is, or has a Family Member who is, a current partner of the company’s outside
auditor, or was a partner or employee of the company’s outside auditor who worked on the company’s audit at any time
during any of the past three years. |
We hope to add qualified
independent members of our board of directors at a later date, depending upon our ability to reach and maintain financial stability.
Audit Committee
The entire board of directors performs
the functions of an audit committee, but no written charter governs the actions of the board when performing the functions of what
would generally be performed by an audit committee. The board approves the selection of our independent accountants and meets and
interacts with the independent accountants to discuss issues related to financial reporting. In addition, the board reviews the
scope and results of the audit with the independent accountants, reviews with management and the independent accountants our annual
operating results, considers the adequacy of our internal accounting procedures and considers other auditing and accounting matters
including fees to be paid to the independent auditor and the performance of the independent auditor. At the present time, Kerry
Driscoll, our chief executive officer and chief financial officer, is considered to be our expert in financial and accounting matters.
Nomination Committee
Our size and the
size of our board, at this time, do not require a separate nominating committee. When evaluating director nominees, our directors
consider the following factors:
| · | The appropriate size of our board of directors; |
| · | Our needs with respect to the particular talents and experience of our
directors; |
| · | The knowledge, skills and experience of nominees, including experience
in finance, administration or public service, in light of prevailing business conditions and the knowledge, skills and experience
already possessed by other members of the board; |
| · | Experience in political affairs; |
| · | Experience with accounting rules and practices; and |
| · | The desire to balance the benefit of continuity with the periodic injection
of the fresh perspective provided by new board members. |
Our goal is to assemble a board that
brings together a variety of perspectives and skills derived from high quality business and professional experience. In doing so,
the board will also consider candidates with appropriate non-business backgrounds.
Other than the foregoing,
there are no stated minimum criteria for director nominees, although the board may also consider such other factors as it may deem
are in our best interests as well as our stockholders. In addition, the board identifies nominees by first evaluating the current
members of the board willing to continue in service. Current members of the board with skills and experience that are relevant
to our business and who are willing to continue in service are considered for re-nomination. If any member of the board does not
wish to continue in service or if the board decides not to re-nominate a member for re-election, the board then identifies the
desired skills and experience of a new nominee in light of the criteria above. Current members of the board are polled for suggestions
as to individuals meeting the criteria described above. The board may also engage in research to identify qualified individuals.
To date, we have not engaged third parties to identify or evaluate or assist in identifying potential nominees, although we reserve
the right in the future to retain a third party search firm, if necessary. The board does not typically consider stockholder nominees
because it believes that its current nomination process is sufficient to identify directors who serve our best interests.
Scientific Advisory Board
We have a Scientific
Advisory Board that provides expert advice on product development and other matters. This board is composed of two members, Dr.
Gordon Chiu and Joe Abrams.
Dr. Chiu has more than
15 years of combined domestic and international experience in biomedical, chemical, cosmetic, medical and technology industries.
He has been invited to serve on the board of public and private companies and to provide vital advice to the board while increasing
overall stockholder value. Dr. Chiu’s background and broad experience has allowed him to act as an advisor in areas of Alzheimer
research, breast cancer research, dermatology, drug addictions research, green technology and antimicrobial research. Dr. Chiu
has worked as a research scientist for both Pfizer (NYSE: PFE) and Merck & Co. Inc. (NYSE: MRK).
Dr. Chiu
graduated with a B.S. degree from Rensselaer Polytechnic Institute with a summa cum laude. He graduated with an M.S. degree
from Seton Hall University. Additionally, Dr. Chiu was accepted as an MD/PhD candidate under the National Institutes of
Health’s Medical Scientist Training Program for four years at the Mount Sinai School of Medicine where he also
researched, developed, consulted and advised the Department of Dermatology’s Dr. Huachen Wei in skin cancer research.
Seeing the opportunity to impact foreign policies in healthcare, he transferred his credentials to University of Bridgeport
School of Naturopathic Medicine to receive his doctorate in naturopathic medicine. With this unique background, he has been
chosen to serve in an advisory role in the identification of low cost technologies (i.e., non-invasive diagnostic
equipment) for emerging countries. His years of continuous involvement have created deep relationships within the scientific,
business, and medical communities.
On February 12, 2011,
Mind Technologies, Inc., one of our predecessors, and Dr. Gordon Chiu, our chief science advisor, granted us a license to use the
technology covered by his patent application. See “Item 13. Certain Relationships and Related Transactions and Director Independence
– Royalty Agreement.”
Joe Abrams co-founded
in 1999 Intermix, the parent company of social networking leader MySpace. In 2005, MySpace was sold to News Corp. for $580 million.
In addition, Mr. Abrams was a founder of The Software Toolworks, a software company that released several hit titles in the 1980’s,
which ultimately led to the company’s sale in 1994 to Pearson, PLC for $462 million. He has deep experience in helping early-stage,
publicly held technology companies reach the next phase of growth.
Section 16(a) Beneficial Ownership
Reporting Compliance
Under Section 16(a) of the Exchange Act,
our directors and certain of our officers, and persons holding more than 10 percent of our common stock are required to file forms
reporting their beneficial ownership of our common stock and subsequent changes in that ownership with the United States Securities
and Exchange Commission. Such persons are also required to furnish Mind Solutions with copies of all forms so filed.
Based solely upon a review of copies
of such forms filed on Forms 3, 4, and 5, and amendments thereto furnished to us, we believe that as of the date of this report,
our executive officers, directors and greater than 10 percent beneficial owners have not complied on a timely basis with all Section
16(a) filing requirements.
Communication with Directors
Stockholders and other interested parties
may contact any of our directors by writing to them at Mind Solutions, Inc., at 3525 Del Mar Heights Road, Suite 802, San Diego,
California 92130, Attention: Corporate Secretary.
Our board has approved a process for
handling letters received by us and addressed to any of our directors. Under that process, the Secretary reviews all such correspondence
and regularly forwards to the directors a summary of all such correspondence, together with copies of all such correspondence that,
in the opinion of the Secretary, deal with functions of the board or committees thereof or that he otherwise determines requires
their attention. Directors may at any time review a log of all correspondence received by us that are addressed to members of the
board and request copies of such correspondence.
Conflicts of Interest
With respect to transactions involving
real or apparent conflicts of interest, we have adopted written policies and procedures which require that:
| · | The fact of the relationship or interest giving rise to the potential
conflict be disclosed or known to the directors who authorize or approve the transaction prior to such authorization or approval; |
| · | The transaction be approved by a majority of our disinterested outside
directors; and |
| · | The transaction be fair and reasonable to us at the time it is authorized
or approved by our directors. |
Code of Ethics for Senior Executive Officers and Senior
Financial Officers
We have adopted an amended Code of Ethics
for Senior Executive Officers and Senior Financial Officers that applies to our president, chief executive officer, chief operating
officer, chief financial officer, and all financial officers, including the principal accounting officer. The code provides as
follows:
| · | Each officer is responsible for full, fair, accurate, timely and understandable
disclosure in all periodic reports and financial disclosures required to be filed by us with the Securities and Exchange Commission
or disclosed to our stockholders and/or the public. |
| · | Each officer shall immediately bring to the attention of the audit committee,
or disclosure compliance officer, any material information of which the officer becomes aware that affects the disclosures made
by us in our public filings and assist the audit committee or disclosure compliance officer in fulfilling its responsibilities
for full, fair, accurate, timely and understandable disclosure in all periodic reports required to be filed with the Securities
and Exchange Commission. |
| · | Each officer shall promptly notify our general counsel, if any, or the
president or chief executive officer as well as the audit committee of any information he may have concerning any violation of
our Code of Business Conduct or our Code of Ethics, including any actual or apparent conflicts of interest between personal and
professional relationships, involving any management or other employees who have a significant role in our financial reporting,
disclosures or internal controls. |
| · | Each officer shall immediately bring to the attention of our general
counsel, if any, the president or the chief executive officer and the audit committee any information he may have concerning evidence
of a material violation of the securities or other laws, rules or regulations applicable to us and the operation of our business,
by us or any of our agents. |
| · | Any waiver of this Code of Ethics for any officer must be approved,
if at all, in advance by a majority of the independent directors serving on our board of directors. Any such waivers granted will
be publicly disclosed in accordance with applicable rules, regulations and listing standards. |
We have posted a copy of our Code of
Ethics on our website. We will provide to any person without charge, upon request, a copy of our Code of Ethics. Any such request
should be directed to our corporate secretary at the address listed below in the next paragraph. The information contained in
our website shall not constitute part of this report.
Item 11. Executive Compensation.
Summary of Cash and Certain Other
Compensation
At present, Mind Solutions has one executive
officer. The compensation program for future executives will consist of three key elements which will be considered by a compensation
committee to be appointed:
| · | A performance bonus; and |
| · | Periodic grants and/or options of our common stock. |
Base Salary. Our chief
executive officer and all other senior executive officers receive compensation based on such factors as competitive industry salaries,
a subjective assessment of the contribution and experience of the officer, and the specific recommendation by our chief executive
officer.
Performance Bonus. A portion
of each officer’s total annual compensation is in the form of a bonus. All bonus payments to officers must be approved by
our compensation committee based on the individual officer’s performance and company performance.
Stock Incentive. Stock grants
and options are awarded to executive officers based on their positions and individual performance. Stock grants and options provide
incentive for the creation of stockholder value over the long term and aid significantly in the recruitment and retention of executive
officers. The compensation committee considers the recommendations of the chief executive officer for stock grants and options
to executive officers (other than the chief executive officer) and approves, disapproves or modifies such recommendation. Stock
grants and options for the chief executive officer will be recommended and approved by our board of directors. See “Market
Price of and Dividends on our Common Equity and Related Stockholder Matters - Securities Authorized for Issuance under Equity
Compensation Plans.”
It is uncertain when, if ever, we will
be in a position to compensate any of our officers or directors. Before we can expect to provide for officer salaries, we will
have to obtain revenues form the sales of our products or raise funds through a debt or equity offering of our securities. See
“Item 1. Business.”
Mind Solutions Summary Compensation
Table
The following table sets forth, for our
named executive officers for the two completed fiscal years ended December 31, 2014, and 2013:
Name and
Principal Position |
Year |
Salary ($) |
Bonus ($) |
Stock Awards ($) |
Option Awards ($) |
Non-Equity Incentive Plan Compensation ($) |
Nonqualified
deferred
compensation
earnings
($) |
All Other Compensation ($) |
Total ($) |
Kerry Driscoll (1) |
2014 |
155,000 |
-0- |
5,000 |
-0- |
-0- |
-0- |
-0- |
160,000 |
|
2013 |
15,060 |
-0- |
274,688 |
-0- |
-0- |
-0- |
-0- |
289,748 |
Jeff Dashefsky (2) |
2014 |
-0- |
-0- |
-0- |
-0- |
-0- |
-0- |
-0- |
-0- |
|
2013 |
23,000 |
-0- |
300,200 |
-0- |
-0- |
-0- |
-0- |
323,200 |
________
(1) Mr. Driscoll is our chairman
of the board, president, chief financial officer, principal accounting officer, and secretary.
| (2) | Mr. Dashefsky was our corporate secretary. On or about September 17, 2013, Mr. Dashefsky verbally resigned as an officer of
Mind Solutions. On October 7, 2013, Mr. Dashefsky executed a formal written notice of resignation as an officer of Mind Solutions. |
How Mr. Driscoll’s
compensation was determined. Mr. Driscoll’s has been serving as our chief executive officer and chief financial officer
since October 2012, and is also a member of our board of directors. Mr. Driscoll executed a Consulting Agreement on December 25,
2013, whereby Mind Solutions issued to him 120,000,000 post reverse split restricted common shares in return for his services
for one year. We recorded the portion of the contract not yet completed at December 31, 2013, as a prepaid expense of $263,397.
Of the 120,000,00 post reverse split shares of our common stock, 100,000,000 were not issued until January 2014, and therefore
were recorded as a stock payable of $220,000 which represented the value of the shares based on the closing share price on the
date of the executed consulting agreement. The 120,000,000 shares were restricted in their transfer pursuant to the Securities
Act. On September 26, 2013, pursuant to our 2009 Incentive Stock Plan, we also issued to Mr. Driscoll 17,813 post reverse split
shares of our common stock which were valued at $11,291. The shares were registered with the SEC on a Form S-8 registration statement.
On September 12, 2014, the Company issued 5,000,000 Series A preferred shares to Mr. Driscoll for services provided which were
valued at par $0.001, resulting in an expense of $5,000.
How Mr. Dashefsky’s
compensation was determined. In 2013, we issued 280,100 post reverse split shares of our common stock to Jeff Dashefsky for
consulting services rendered to VOIS, Inc. These shares were valued at $300,200 based on the closing share price on the date of
the executed Officer Agreement on August 20, 2013, and were restricted in their transfer pursuant to the Securities Act. In 2012,
we issued 100 post reverse split shares of our common stock to Jeff Dashefsky for consulting services to Mind Solutions. These
shares were valued at $14,000 based on the closing share price of $0.07 on the issuance of the shares, and were restricted in their
transfer pursuant to the Securities Act.
Outstanding Equity Awards at Fiscal
Year-End
The following table provides
information for each of our named executive officers as of the end of our last completed fiscal year, December 31, 2014:
|
Option Awards |
Stock Awards |
Name |
Number of Securities Underlying Unexercised Options (#) Exercisable |
Number of Securities Underlying Unexercised Options (#) Unexercisable |
Equity Incentive Plan Awards: Number of Securities Underlying Unexercised Unearned Options (#) |
Option Exercise Price ($) |
Option Expiration Date |
Number of Shares or Units of Stock That Have Not Vested |
Market Value of Shares or Units of Stock That Have Not Vested |
Equity Incentive Plan Awards: Number of Unearned Shares, Units or Other Rights That Have Not Vested |
Equity Incentive Plan Awards: Market or Payout Value of Unearned Shares, Units or Other Rights That Have Not Vested ($) |
Kerry Driscoll (1) |
-0- |
-0- |
-0- |
-0- |
-0- |
-0- |
-0- |
-0- |
-0- |
Jeff Dashefsky (2) |
-0- |
-0- |
-0- |
-0- |
-0- |
-0- |
-0- |
-0- |
-0- |
________
(1) Mr. Driscoll is our chief financial
officer, principal accounting officer, and secretary.
| (2) | Mr. Dashefsky was our corporate secretary. On or about September 17, 2013, Mr. Dashefsky verbally resigned as an officer of
Mind Solutions. On October 7, 2013, Mr. Dashefsky executed a formal written notice of resignation as an officer of Mind Solutions. |
Mind Solutions Employment Agreements
As of the date of this report, Mind Solutions
does not have any employment agreement with Kerry Driscoll, our chairman of the board, president, chief financial officer, principal
accounting officer, and secretary, although we do have a Consulting Agreement executed on December 25, 2013. Pursuant to the Consulting
Agreement, Mr. Driscoll is charged with creating operating plans for the strategic direction of Mind Solutions correlated with
annual operating budgets, and will provide such services as managing the business of sales, marketing, production and general business
services.
In consideration of the services to be
provided by Mr. Driscoll during the term of the Consulting Agreement, Mr. Driscoll was issued 120,000,000 shares of our common
stock, which were restricted in their transfer as required by the Securities Act. The term for this agreement shall be for one
year from its date, but can be renewed by mutual agreement by both parties.
Mind Solutions Director Compensation
Our directors do not receive compensation
for their services as directors.
Item 12. Security Ownership
of Certain Beneficial Owners and Management and Related Stockholder Matters.
The following table presents information
regarding the beneficial ownership of all shares of our common stock and preferred stock as of the date of this report by:
| · | Each person who owns beneficially more than five percent of the outstanding
shares of our common stock; |
| · | Each person who owns beneficially more than five percent of the outstanding
shares of our preferred stock; |
| · | Each named executive officer; and |
| · | All directors and officers as a group. |
Name of Beneficial Owner (1) | |
Shares of Preferred Stock Beneficially Owned (2) | |
Shares of Common Stock Beneficially Owned (2) |
| |
Number Percent | |
| Number | | |
| Percent | |
Kerry Driscoll (3) | |
5,000,000 50.00 | |
| 113,782,343 | | |
| 6.86 | |
Brent Fouch (4) | |
5,000,000
50.00 | |
| -0- | | |
| -0- | |
All officers and directors as a group (one person) | |
5,000,000 50.00 | |
| 113,782,343 | | |
| 6.86 | |
________
| (1) | Unless otherwise indicated, the address for each of these stockholders is c/o Mind Solutions, Inc., at 3525 Del Mar Heights
Road, Suite 802, San Diego, California 92130. Also, unless otherwise indicated, each person named in the table above has the sole
voting and investment power with respect to our shares of common stock or preferred stock which he beneficially owns. |
| (2) | Beneficial ownership is determined in accordance with the rules of the Securities and Exchange Commission. As of the date of
this report, there were outstanding 1,658,464,262 shares of our common stock. As of the date of this report, we have 10,000,000
shares of the Series A Preferred Stock issued and outstanding. The Series A Preferred Stock does not have any voting rights. However,
subject to adjustment as provided in the Certificate of Designation, each share of the Series A Preferred Stock shall be convertible
into 100 fully paid and nonassessable share of our common stock. The conversion rights with respect to the Series A Preferred Stock
mean that Mr. Driscoll has the right to convert his shares of preferred stock into 500,000,000 shares of common stock. However,
Mr. Driscoll shall have no right to convert any shares of Series A Preferred Stock, to the extent that after giving effect to such
conversion, he (together with his affiliates) would have acquired, through conversion of shares of the Series A Preferred Stock
or otherwise, beneficial ownership of a number of shares of our common stock that exceeds 9.99% of the number of shares of our
common stock outstanding immediately after giving effect to such conversion. As of the date of this report, Mr. Driscoll has not
converted any shares of the Series A Preferred Stock into shares of our common stock. |
| (3) | Mr. Driscoll is our president, chief executive officer, and sole director. |
| (4) | Mr. Fouch is a former officer of the registrant. However, Mr. Fouch shall have no right to convert any shares of Series A Preferred
Stock, to the extent that after giving effect to such conversion, he (together with his affiliates) would have acquired, through
conversion of shares of the Series A Preferred Stock or otherwise, beneficial ownership of a number of shares of our common stock
that exceeds 9.99% of the number of shares of our common stock outstanding immediately after giving effect to such conversion.
As of the date of this report, Mr. Fouch has not converted any shares of the Series A Preferred Stock into shares of our common
stock. |
As a result of both
common and preferred stock ownership by Mr. Driscoll, he may be able to influence most matters requiring stockholder approval including
the election of directors, merger or consolidation. This concentration of ownership may delay, deter or prevent acts that would
result in a change of control, which in turn could reduce the market price of our common stock.
Other than as stated
herein, there are no arrangements or understandings, known to us, including any pledge by any person of our securities:
| · | The operation of which may at a subsequent date result in a change in control of Mind Solutions;
or |
| · | With respect to the election of directors or other matters. |
Item 13. Certain Relationships
and Related Transactions and Director Independence.
Consulting Agreements
Consulting Agreements with Kerry Driscoll.
Mind Solutions executed a Consulting Agreement on December 25, 2013, with Kerry Driscoll, our current chief executive officer and
chief financial officer, whereby we issued 120,000,000 post reverse-split shares of our common stock for one year of executive
services. The 120,000,000 shares were valued at the closing price of $0.0022 on the date of the agreement which resulted in Mind
Solutions recording officer compensation of $264,000 over the life of the agreement. The portion of the agreement not yet completed
as of December 31, 2013, was recorded as prepaid expense in the amount of $263,397.
On September 30, 2013, we issued 17,812
post reverse-split shares of our common stock to Kerry Driscoll for consulting services rendered to Mind Solutions by September
30, 2013, which shares had been registered pursuant to our Registration Statement on Form S-8 filed March 31, 2013, with the SEC
and a subsequent Post-Effective Amendment No. 1 to Form S-8 filed with the SEC on September 9, 2013.
The registrant executed a service agreement
on September 12, 2014, with its current Chief Executive Officer, Kerry Driscoll, whereby the registrant issued 5,000,000 shares
of Series A Preferred Stock for one year of services such as compliance, guidance, infrastructure and business strategy. The 5,000,000
shares were valued at par $0.001which resulted in the registrant recording officer compensation of $5,000 over the life of the
contract.
In addition to the above issuance of
shares of our common stock to Mr. Driscoll, with respect to various Consulting Agreements with Mr. Driscoll, please see “Market
for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities – Securities
Authorized for Issuance under Equity Compensation Plans.”
Consulting Agreement with Mark Lucky.
In the year ended December 31, 2013, Mind Solutions issued 69,688 post reverse-split shares of our common stock to Mark Lucky,
the former chief executive officer of Mind Solutions, Inc., for professional services.
In addition to the above issuance of
shares of our common stock to Mr. Lucky, with respect to various Consulting Agreements with Mr. Lucky, please see “Market
for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities – Securities
Authorized for Issuance under Equity Compensation Plans.”
Consulting Agreement with Jeff Dashefsky.
In the year ended December 31, 2013, Mind Solutions issued 259,000 post reverse-split shares of our common stock to Jeff Dashefsky,
the former corporate secretary of Mind Solutions, Inc., for professional services.
In addition to the above issuance of
shares of our common stock to Mr. Dashefsky, with respect to various Consulting Agreements with Mr. Dashefsky, please see “Market
for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities – Securities
Authorized for Issuance under Equity Compensation Plans.”
Accounts Payable to
a Related Party
Mind Solutions was advanced money by
Iceweb Storage Corporation, Inc, at zero percent interest, for working capital commitments. Mark Lucky, our former chief operating
officer, is a current officer of Iceweb Storage. At December 31, 2014, and December 31, 2013, the balance due to Iceweb Storage
was $3,500.
Royalty
Agreement
On
February 12, 2011, Mind Technologies, Inc., one of our predecessors, and Dr. Gordon Chiu, our chief science advisor, granted
us a license to use the technology covered by his patent application. Through the series of mergers described in this report,
Mind Solutions acquired the license granted to Mind Technologies, Inc. For the period, that Mind Technologies, Inc. (now Mind
Solutions) exists and funds the development and progress of the covered invention, Dr. Chiu agreed to license the use of the
technology to Mind Solutions. If Mind Solutions fails to support the launch, progress and/or funding of the production of the
invention, then the license may be terminated. The agreement provided that Dr. Chiu will receive a non-refundable,
non-dilutable cash royalty payment equal to 20 percent of the gross proceeds received by Mind Solutions from the use of the
covered technology. In addition, Brent Fouch, the former president of Mind Technologies, and one of our advisors, will
receive a non-refundable, non-dilutable cash royalty payment equal to five percent of the gross proceeds received by Mind
Solutions from the use of the covered technology.
License
Agreement
In
December 2012, we executed a license agreement with Mind Technologies, Inc. for the right to use, develop, improve, manufacture,
and sale the licensed software application which uses wireless headsets to
read brain waves
and allow interaction
with a computer.
We issued 3,500 post reverse-split shares of our common stock as consideration for the
license agreement. Mind Technologies, Inc. was a related party to Mind Solutions because its chief executive officer, Brent Fouch,
was also the former chief executive officer of Mind Solutions, Inc. See Note 9 to our attached financial statements for more details
on licensed products.
Service Agreement
with Former Officer
The registrant executed a service
agreement on September 12, 2014, with Brent Fouch, a former officer of the registrant, whereby the registrant issued
5,000,000 shares of Series A Preferred Stock for one year services to facilitate the development of BCI software
compatibility with the registrant’s micro BCI headset. The 5,000,000 shares were valued at par $0.001 which resulted in
the registrant recording a consulting expense of $5,000 over the life of the contract.
Asset
Purchase Agreement
On
April 30, 2013, we executed an asset purchase agreement with Mind Technologies, Inc. whereby we purchased all the assets of Mind
Technologies, Inc. for 15,000 post reverse-split shares of our common stock. The assets purchased include those previously licensed
from Mind Technologies, Inc., described in Note 9 to our attached financial statements.
Free Office Space
Provided by Chief Executive Officer
Mind Solutions has been provided office
space by its chief executive officer Kerry Driscoll at no cost. Management has determined that such cost is nominal and did not
recognize the rent expense in its financial statements.
Transactions with
Brent Fouch
Beginning in 2010 and continuing into
2014, there were several agreements executed between Mind Solutions, Inc. and its predecessors with Brent Fouch, one of the officers
of a predecessor who loaned $347,292 to Mind Solutions for working capital purposes. In payment of the amount owed to Mr. Fouch,
we issued various convertible promissory notes. Mr. Fouch subsequently converted or assigned the notes to Magna Group, LLC, as
follows:
| · | Convertible Promissory Note dated December 31, 2010, issued by Mind
Solutions, Inc. in favor of Brent Fouch, in the amount of $157,324.06. |
| · | Convertible Promissory Note dated March 30, 2012, issued by Mind Solutions,
Inc. in favor of Brent Fouch, in the amount of $40,000. |
| · | Convertible Promissory Note dated June 30, 2012, issued by Mind Solutions,
Inc. in favor of Brent Fouch, in the amount of $40,000. |
| · | Convertible Promissory Note dated January 3, 2013, issued by Mind Solutions,
Inc. in favor of Brent Fouch, in the amount of $48,872. |
| · | Convertible Promissory Note dated January 3, 2014, issued by Mind Solutions,
Inc. in favor of Brent Fouch, in the amount of $61,096. |
| · | Assignment Agreement dated February 5, 2013, by and between Brent Fouch,
as assignor, Magna Group, LLC, as assignee, and VOIS, Inc. assigning $40,000 of the Convertible Promissory Note dated March 30,
2012, issued by Mind Solutions, Inc. in favor of Brent Fouch, in the amount of $40,000. |
| · | Assignment Agreement dated March 7, 2013, by and between Brent Fouch,
as assignor, Magna Group, LLC, as assignee, and VOIS, Inc. assigning $40,000 of the Convertible Promissory Note dated June 30,
2012, issued by Mind Solutions, Inc. in favor of Brent Fouch, in the amount of $40,000. |
| · | Assignment Agreement dated June 5, 2013, by and between Brent Fouch,
as assignor, Magna Group, LLC, as assignee, and VOIS, Inc. assigning $106,324 of the Convertible Promissory Note dated December
31, 2010, issued by Mind Solutions, Inc. in favor of Brent Fouch, in the amount of $157,324.06. Mr. Fouch retained $51,000.06 of
the Convertible Promissory Note dated December 31, 2010, which was converted into 10,625 post
reverse-split shares of our common stock, as described in the immediately following bullet point. |
| · | Debt Conversion Agreement dated April 4, 2013, by and between Brent
Fouch and VOIS, Inc. converting $51,000.06 of the Convertible Promissory Note dated December 31, 2010, issued by Mind Solutions,
Inc. in favor of Brent Fouch, in the amount of $157,324.06 into 10,625 post reverse-split shares
of our common stock. On April 11, 2013, we issued 10,625 post reverse-split shares of
our common stock, which were issued free of any restrictions pursuant to Rule 144 under the Securities Act. The
shares were issued resulting from conversion of the above-described Convertible Promissory Note dated December 31, 2010. |
| · | Assignment Agreement dated November 11, 2013, by and between Brent Fouch,
as assignor, Magna Group, LLC, as assignee, and VOIS, Inc. assigning the Convertible Promissory Note dated January 3, 2013, issued
by Mind Solutions, Inc. in favor of Brent Fouch, in the amount of $48,872. |
| · | Assignment Agreement dated June 5, 2014, by and between Brent Fouch,
as assignor, Magna Group, LLC, as assignee, and VOIS, Inc. assigning the Convertible Promissory Note dated January 3, 2014, issued
by Mind Solutions, Inc. in favor of Brent Fouch, in the amount of $61,096. |
As of the date of this report we have
repaid all sums owing by us to Mr. Fouch. As a result of the various assignments by Mr. Fouch to Magna Group, LLC, Mr. Fouch received
the sum of $289,792 from Magna Group, LLC. Due to the conversion by Magna Group, LLC of the various notes assigned by Mr. Fouch,
Magna Group, LLC received 52,803,315 post reverse split shares of our common stock. The shares were issued free of any restrictions
pursuant to Rule 144 under the Securities Act.
Consulting Agreements with Brent Fouch.
Beginning in 2012, we have executed Consulting Agreements with Brent Fouch, as follows:
| · | Consulting
Agreement dated October 24, 2012. Pursuant to the agreement, Mr. Fouch provided such
services and advice to VOIS, Inc. so as to effect a reverse merger to become a fully
reporting public company on the OTCQB. In addition, Mr. Fouch provided ongoing advisory
services related to maintaining compliance and advise VOIS, Inc. in conducting due diligence
to comply all applicable federal, state and local laws. In consideration of services
rendered during the term of the agreement, Mr. Fouch received 5,000 post reverse-split
shares of our common stock which have been registered pursuant to an S-8 registration
statement. The shares were delivered upon successful completion of our reverse merger. |
| · | Consulting
Agreement dated December 18, 2012. Pursuant to the agreement, Mr. Fouch provided such
services and advice to VOIS, Inc. in the areas of licensing and acquiring assets related
to our business. In addition, Mr. Fouch provided ongoing advisory services to VOIS, Inc.
as related to compliance, guidance, infrastructure, and business strategy in connection
with the operation of a publicly-traded company. In consideration of services rendered
during the term of the agreement, Mr. Fouch received 5,000 post reverse-split shares
of our common stock which have been registered pursuant to an S-8 registration statement. |
| | |
| · | Consulting
Agreement dated January 30, 2013. Pursuant to the agreement, Mr. Fouch provided such
services and advice to VOIS, Inc. in the areas of securing BCI software compatible with
the Emotiv Headset. In addition, Mr. Fouch provided ongoing advisory services to VOIS,
Inc. as related to compliance, guidance, infrastructure, and business strategy in connection
with the operation of a publicly-traded company. In consideration of services rendered
during the term of the agreement, Mr. Fouch received 5,000 post reverse-split shares
of our common stock which have been registered pursuant to an S-8 registration statement. |
| | |
| · | Consulting
Agreement dated February 20, 2013. Pursuant to the agreement, Mr. Fouch provided such
services and advice to VOIS, Inc. in the areas of EEG headset development, and to finalize
the SDK software system for the EEG headset, as well as ongoing advisory services to
VOIS, Inc. as related to compliance, guidance, infrastructure, and business strategy
in connection with the operation of a publicly-traded company. In consideration of services
rendered during the term of the agreement, Mr. Fouch received 7,500 post reverse-split
shares of our common stock which have been registered pursuant to an S-8 registration
statement. |
| | |
| · | Consulting
Agreement dated September 2, 2013. Pursuant to the agreement, Mr. Fouch provided such
services and advice to VOIS, Inc. in the areas of capital structure, and such services
and advice so as to recapitalize VOIS, Inc. through a 14C filing, and guidance regarding
a name change, re-domicile and designation of the Preferred A class of stock.. In addition,
Mr. Fouch provided ongoing advisory services to VOIS, Inc. as related to compliance,
guidance, infrastructure, and business strategy in connection with the operation of a
publicly-traded company. In consideration of services rendered during the term of the
agreement, Mr. Fouch received 35,000 post reverse-split shares of our common stock which
have been registered pursuant to an S-8 registration statement. |
| | |
| · | Consulting
Agreement dated September 26, 2013. Pursuant to the agreement, Mr. Fouch provided such
services and advice to VOIS, Inc. in the areas of EEG research and development, and to
provide compliance, guidance, infrastructure and business strategy in connection with
the operation of a publicly-traded company. In consideration of services rendered during
the term of the agreement, Mr. Fouch received 19,688 post reverse-split shares of our
common stock which have been registered pursuant to an S-8 registration statement. |
| | |
| · | Consulting
Agreement dated May 1, 2013. Pursuant to the agreement, Mr. Fouch provided such services
and advice to VOIS, Inc. in the areas of guiding VOIS, Inc. through the process of completing
an asset acquisition, and to provide compliance, guidance, infrastructure and business
strategy in connection with the operation of a publicly-traded company. In consideration
of services rendered during the term of the agreement, Mr. Fouch received 5,000 post
reverse-split shares of our common stock which have been registered pursuant to an S-8
registration statement. |
| | |
| · | Consulting
Agreement dated July 19, 2013. Pursuant to the agreement, Mr. Fouch provided such services
and advice to VOIS, Inc. in the areas of capital structure, and to provide compliance,
guidance, infrastructure and business strategy in connection with the operation of a
publicly-traded company. In consideration of services rendered during the term of the
agreement, Mr. Fouch received 10,000 post reverse-split shares of our common stock which
have been registered pursuant to an S-8 registration statement. |
| | |
| · | Consulting
Agreement dated January 2, 2014. Pursuant to the agreement, Mr. Fouch will provide services
and advise on all matters which relate to the public filings and compliance by Mind Solutions
under the rules of the SEC. In addition, Mr. Fouch will provide guidance regarding development
of the next generation of software applications. As compensation, Mr. Fouch has received
5,000 post reverse-split shares of our common stock which have been registered pursuant
to an S-8 registration statement. |
| | |
| · | Consulting
Agreement dated May 2, 2014. Pursuant to the agreement, Mr. Fouch will locate an experienced,
proven company and owner in the field of software technology and negotiate a position
on the company’s advisory board. The individual or company selected must have a
history of operating or selling companies in excess of $100 million. Mr. Fouch shall
provide such services related to maintaining compliance and advise Mind Solutions in
conducting due diligence to comply all applicable federal, state and local laws. In consideration
of services rendered to date and to be rendered during the term of the agreement, Mr.
Fouch received 2,500 post reverse-split shares of our common stock which have been registered
pursuant to an S-8 registration statement. |
| | |
| · | The
registrant executed a service agreement on September 12, 2014, with Mr. Fouch, a former
officer of the registrant, whereby the registrant issued 5,000,000 shares of Series A
Preferred Stock for one year services to facilitate the development of BCI software compatibility
with the registrant’s micro BCI headset. The 5,000,000 shares were valued at par
$0.001 which resulted in the registrant recording a consulting expense of $5,000 over
the life of the contract. |
Certain copies of the
Consulting Agreements with Brent Fouch have already been filed with the SEC as exhibits. Copies of the Consulting Agreements which
have not been previously filed with the SEC are filed as exhibits to this report.
In addition to the above issuance of
shares of our common stock to Mr. Fouch, please see “Item 5. Market for Registrant’s Common Equity, Related Stockholder
Matters and Issuer Purchases of Equity Securities – Securities Authorized for Issuance under Equity Compensation Plans and
Recent Sales of Unregistered Securities.”
Item 14. Principal Accounting
Fees and Services.
Audit Fees
The aggregate fees billed by Terry L.
Johnson, CPA for professional services rendered for the audit of our annual financial statements for fiscal year ended December
31, 2014 and 2013, were $20,500.
The aggregate fees billed by Patrick
Rodgers, CPA, P.A. for professional services rendered for the audit of our annual financial statements for fiscal year ended December
31, 2013, were $17,500.
Audit Related Fees
The aggregate audit-related fees billed
by Terry L. Johnson, CPA for professional services rendered for the audit of our annual financial statements for fiscal year ended
December 31, 2014 and 2013, were $0.
The aggregate audit-related fees billed
by Patrick Rodgers, CPA, P.A. for professional services rendered for the audit of our annual financial statements for fiscal year
ended December 31, 2013, were $0.
Tax Fees
The aggregate tax fees billed by Patrick
Rodgers, CPA, P.A. and/or Terry L. Johnson, CPA for professional services rendered for tax services for fiscal year ended December
31, 2013, were $0.
The aggregate tax fees billed by a prior
audit firm for professional services rendered for tax services for fiscal year ended December 31, 2014, were $2,000.
All Other Fees
There were no other fees billed by Patrick
Rodgers, CPA, P.A. or Terry L. Johnson, CPA for professional services rendered during the fiscal years ended December 31, 2014
and 2013, other than as stated under the captions Audit Fees, Audit-Related Fees, and Tax Fees.
PART IV
Item 15. Exhibits, Financial
Statement Schedules.
(a) | All financial statements are included in Item 8 of this report. |
(b) | All financial statement schedules required to be filed by Item 8 of this report and the exhibits
contained in this report are included in Item 8 of this report. |
(c) | The following exhibits are attached to this report: |
Exhibit No. |
Identification of Exhibit |
2.1** |
Plan and Agreement of Merger Between VOIS, Inc. (a Florida Corporation) and Mind Solutions, Inc. (a Nevada corporation) dated October 15, 2013, filed as an exhibit to the registrant’s Definitive Schedule 14C on October 23, 2013, Commission File Number 000-33053. |
2.2** |
Agreement and Plan of Merger dated October 19, 2012, by and among VOIS, Inc., Mind Solutions, Inc., a Nevada corporation, Mind Solutions, Inc., an Ontario corporation and Mind Solutions Acquisition Corp., a Nevada corporation filed as Exhibit 2.1 to the registrant’s Form 8-K on October 23, 2012, Commission File Number 000-33053. |
3.1** |
Delaware Certificate of Incorporation of Medical Records by Net, Inc., dated May 19, 2000, filed as Exhibit 2(a) to the registrant’s Registration Statement on Form SB-1 on March 22, 2001, Commission File Number 333-57468 |
|
Delaware Certificate of Amendment to the Certificate of Incorporation of Medical Records by Net, Inc. changing the its corporate name to Lifelink Online, Inc., dated October 17, 2000, filed as Exhibit 2(a) to the registrant’s Registration Statement on Form SB-1 on March 22, 2001, Commission File Number 333-57468. |
|
Delaware Certificate of Amendment to the Certificate of Incorporation of Lifelink Online, Inc. changing the its corporate name to MedStrong Corporation, dated January 17, 2001, filed as Exhibit 2(a) to the registrant’s Registration Statement on Form SB-1 on March 22, 2001, Commission File Number 333-57468. |
|
Delaware Certificate of Amendment to the Certificate of Incorporation of MedStrong Corporation changing the its corporate name to MedStrong International Corporation, dated March 9, 2001, filed as Exhibit 2(a) to the registrant’s Registration Statement on Form SB-1 on March 22, 2001, Commission File Number 333-57468. |
3.2** |
Certificate of Amendment to the Certificate of Incorporation of MedStrong International Corporation dated August 2006, filed as Exhibit 3.1(a) to the registrant’s Report on Form 10-QSB on August 21, 2006, Commission File Number 333-57468. |
|
Form of Restated Certificate of Incorporation of MedStrong International Corporation dated May 19, 2000, filed as Exhibit 3.1(b) to the registrant’s Report on Form 10-QSB on August 21, 2006, Commission File Number 333-57468. |
3.3** |
Certificate of Amendment to the Certificate of Incorporation of MedStrong International Corporation dated October 24, 2006, filed as Exhibit 3.1(c) to the registrant’s Report on Form 10-KSB on March 30, 2007, Commission File Number 333-57468. |
3.4** |
Certificate of Amendment to the Certificate of Incorporation of MedStrong International Corporation changing its name to VOIS, Inc. dated March 26, 2007, filed as Exhibit 3.1(e) to the registrant’s Report on Form 10-QSB on May 15, 2007, Commission File Number 333-57468. |
3.5** |
Bylaws of Lifelink Online, Inc. filed as Exhibit 2(b) to the registrant’s Registration Statement on Form SB-1 on March 23, 2001, Commission File Number 333-57468. |
3.6** |
Certificate of Domestication and Articles of Incorporation of VOIS, Inc. filed with the Secretary of State of Florida on March 18, 2009, filed as Exhibit 3.10 to the registrant’s Report on Form 8-K on March 24, 2009, Commission File Number 000-33035. |
3.7** |
Articles of Amendment to the Articles of Incorporation of VOIS, Inc. as filed with the Secretary of State of Florida on November 4, 2010, filed as Exhibit 3.13 to the registrant’s Current Report on Form 8-K on November 22, 2010, Commission File Number 000-33053. |
3.8** |
Articles of Amendment to the Articles of Incorporation of VOIS Inc. filed with the Florida Secretary of State on December 2, 2011, filed as Exhibit 3.8 to the registrant’s Annual Report on Form 10-K/A on May 14, 2014, Commission File Number 000-33053. |
3.9** |
Articles of Merger between Mind Solutions, Inc. and Mind Solutions Acquisition Corp. filed with the State of Nevada on October 23, 2012, filed as Exhibit 3.9 to the registrant’s Annual Report on Form 10-K/A on May 14, 2014, Commission File Number 000-33053. |
3.10** |
Articles of Amendment to the Articles of Incorporation of VOIS Inc. filed with the Florida Secretary of State on May 17, 2013, filed as Exhibit 3.10 to the registrant’s Annual Report on Form 10-K/A on May 14, 2014, Commission File Number 000-33053. |
3.11** |
Articles of Amendment to the Articles of Incorporation of VOIS Inc. filed with the Florida Secretary of State on August 28, 2013, filed as Exhibit 3.1 to the registrant’s Current Report on Form 8-K on August 30, 2013, Commission File Number 000-33053. |
3.12** |
Amended and Restated Articles of Incorporation of Mind Solutions, Inc. on October 28, 2013, filed as an exhibit to the registrant’s Definitive Schedule 14C on October 23, 2013, Commission File Number 000-33053. |
3.13** |
Amended and Restated Bylaws of Mind Solutions, Inc. on October 28, 2013, filed as an exhibit to the registrant’s Definitive Schedule 14C on October 23, 2013, Commission File Number 000-33053. |
3.14** |
Articles of Merger between Mind Solutions, Inc. and VOIS, Inc. filed with the State of Florida on October 28, 2013, filed as Exhibit 3.14 to the registrant’s Annual Report on Form 10-K on April 14, 2014, Commission File Number 000-33053. |
3.15** |
Articles of Merger between Mind Solutions, Inc. and VOIS, Inc. filed with the State of Nevada on October 28, 2013, filed as Exhibit 3.15 to the registrant’s Annual Report on Form 10-K on April 14, 2014, Commission File Number 000-33053. |
|
3.16** |
Amendment to the Articles of Incorporation of VOIS, Inc. filed with the State of Florida on August 28, 2013, filed as Exhibit 3.16 to the registrant’s Annual Report on Form 10-K on April 14, 2014, Commission File Number 000-33053. |
|
3.17** |
Articles of Incorporation of Red Meteor, Inc. filed with the Secretary of State of Nevada on May 24, 2002, filed as Exhibit 3.17 to the registrant’s Annual Report on Form 10-K/A on May 14, 2014, Commission File Number 000-33053. |
|
3.18** |
Certificate of Amendment to the Articles of Incorporation of Red Meteor, Inc. changing its name to Prize Entertainment, Inc. filed with the Secretary of State of Nevada on November 13, 2003, filed as Exhibit 3.18 to the registrant’s Annual Report on Form 10-K/A on May 14, 2014, Commission File Number 000-33053. |
|
3.19** |
Certificate of Amendment to the Articles of Incorporation of Prize Entertainment, Inc. changing its name to Mind Solutions, Inc. filed with the Secretary of State of Nevada on November 20, 2009, filed as Exhibit 3.19 to the registrant’s Annual Report on Form 10-K/A on May 14, 2014, Commission File Number 000-33053. |
|
3.20** |
Bylaws of Red Meteor, Inc. filed as Exhibit 3.20 to the registrant’s Annual Report on Form 10-K/A on May 14, 2014, Commission File Number 000-33053. |
|
4.1** |
Certificate of Designation for Series A Preferred Stock filed with the Secretary of State of Nevada on September 10, 2014, filed as Exhibit 4.1 to the registrant’s Report on Form 8-K on September 10, 2014, Commission File Number 000-33035. |
|
10.1** |
Asset Purchase Agreement dated April 30, 2013, by and between Mind Technologies, Inc., a Nevada corporation, and VOIS, Inc. filed as Exhibit 10.1 to the registrant’s Current Report on Form 8-K on May 7, 2013, Commission File Number 000-33053. |
|
10.2** |
Equity Purchase Agreement, dated March 11, 2014, between Mind Solutions, Inc. and Premier Venture Partners, LLC filed as Exhibit 10.1 to the registrant’s Current Report on Form 8-K on March 26, 2014, Commission File Number 000-33053. |
|
10.3** |
Securities Purchase Agreement, dated March 11, 2014, between Mind Solutions, Inc. and Premier Venture Partners, LLC filed as Exhibit 10.2 to the registrant’s Current Report on Form 8-K on March 26, 2014, Commission File Number 000-33053. |
|
10.4** |
Convertible Promissory Note in the original principal amount of $10,000 executed by Mind Solutions, Inc. in favor of Premier Venture Partners, LLC filed as Exhibit 10.3 to the registrant’s Current Report on Form 8-K on March 26, 2014, Commission File Number 000-33053. |
|
10.5** |
Registration Rights Agreement, dated March 11, 2014, between Mind Solutions, Inc. and Premier Venture Partners, LLC filed as Exhibit 10.4 to the registrant’s Current Report on Form 8-K on March 26, 2014, Commission File Number 000-33053. |
|
10.6** |
Charter of the Audit Committee of Mind Solutions, Inc. filed as Exhibit 10.6 to the registrant’s Annual Report on Form 10-K on April 14, 2014, Commission File Number 000-33053. |
10.7** |
Code of Business Conduct of Mind Solutions, Inc. filed as Exhibit 10.7 to the registrant’s Annual Report on Form 10-K on April 14, 2014, Commission File Number 000-33053. |
10.8** |
Amended Code of Ethics for Senior Executive Officers and Senior Financial Officers of Mind Solutions, Inc. filed as Exhibit 10.8 to the registrant’s Annual Report on Form 10-K on April 14, 2014, Commission File Number 000-33053. |
10.9** |
Charter of the Compensation Committee of Mind Solutions, Inc. filed as Exhibit 10.9 to the registrant’s Annual Report on Form 10-K on April 14, 2014, Commission File Number 000-33053. |
10.10** |
Corporate Governance Principles of the Board of Directors of Mind Solutions, Inc. filed as Exhibit 10.10 to the registrant’s Annual Report on Form 10-K on April 14, 2014, Commission File Number 000-33053. |
10.11** |
Charter of the Executive Committee of the Board of Directors of Mind Solutions, Inc. filed as Exhibit 10.11 to the registrant’s Annual Report on Form 10-K on April 14, 2014, Commission File Number 000-33053. |
10.12** |
Charter of the Finance Committee of Mind Solutions, Inc. filed as Exhibit 10.12 to the registrant’s Annual Report on Form 10-K on April 14, 2014, Commission File Number 000-33053. |
10.13** |
Charter of the Governance and Nominating Committee of Mind Solutions, Inc. filed as Exhibit 10.13 to the registrant’s Annual Report on Form 10-K on April 14, 2014, Commission File Number 000-33053. |
10.14** |
Royalty, Ownership and Inventor’s Agreement, dated February 12, 2011, by and between Dr. Gordon Chiu, Brent Fouch, and Mind Technologies, Inc. filed as Exhibit 10.14 to the registrant’s Annual Report on Form 10-K on April 14, 2014, Commission File Number 000-33053. |
|
10.15** |
Consulting Agreement dated December 25, 2013, by and between Kerry Driscoll and the registrant filed as Exhibit 10.15 to the registrant’s Annual Report on Form 10-K on April 14, 2014, Commission File Number 000-33053. |
|
10.16** |
Officer Agreement dated August 20, 2013, by and between Jeff Dashefsky and VOIS, Inc. filed as Exhibit 10.16 to the registrant’s Annual Report on Form 10-K on April 14, 2014, Commission File Number 000-33053. |
|
10.17** |
Settlement Agreement and Stipulation dated November 21, 2013, by and between IBC Funds, LLC and the registrant filed as Exhibit 10.17 to the registrant’s Annual Report on Form 10-K on April 14, 2014, Commission File Number 000-33053. |
|
10.18** |
Order Granting Approval of Settlement Agreement and Stipulation between IBC Funds, LLC and the registrant dated November 22, 2013, filed as Exhibit 10.18 to the registrant’s Annual Report on Form 10-K on April 14, 2014, Commission File Number 000-33053. |
|
10.19** |
Securities Purchase Agreement dated February 5, 2013, between Hanover Holdings I, LLC and the registrant with respect to the issuance of a Convertible Promissory Note in the amount of $16,500 filed as Exhibit 10.19 to the registrant’s Annual Report on Form 10-K/A on May 14, 2014, Commission File Number 000-33053. |
|
10.20** |
Convertible Promissory Note dated February 5, 2013, issued by the registrant in favor of Hanover Holdings I, LLC, in the amount of $16,500 filed as Exhibit 10.20 to the registrant’s Annual Report on Form 10-K/A on May 14, 2014, Commission File Number 000-33053. |
|
10.21** |
Securities Purchase Agreement dated March 7, 2013, between Hanover Holdings I, LLC and the registrant with respect to the issuance of a Convertible Promissory Note in the amount of $16,500 filed as Exhibit 10.21 to the registrant’s Annual Report on Form 10-K/A on May 14, 2014, Commission File Number 000-33053. |
|
10.22** |
Convertible Promissory Note dated March 7, 2013, issued by the registrant in favor of Hanover Holdings I, LLC, in the amount of $16,500 filed as Exhibit 10.22 to the registrant’s Annual Report on Form 10-K/A on May 14, 2014, Commission File Number 000-33053. |
|
10.23** |
Securities Purchase Agreement dated June 5, 2013, between Hanover Holdings I, LLC and the registrant with respect to the issuance of a Convertible Promissory Note in the amount of $41,500 filed as Exhibit 10.23 to the registrant’s Annual Report on Form 10-K/A on May 14, 2014, Commission File Number 000-33053. |
|
10.24** |
Convertible Promissory Note dated June 5, 2013, issued by the registrant in favor of Hanover Holdings I, LLC, in the amount of $41,500 filed as Exhibit 10.24 to the registrant’s Annual Report on Form 10-K/A on May 14, 2014, Commission File Number 000-33053. |
|
10.25** |
Securities Purchase Agreement dated August 7, 2013, between Hanover Holdings I, LLC and the registrant with respect to the issuance of a Convertible Promissory Note in the amount of $26,500 filed as Exhibit 10.25 to the registrant’s Annual Report on Form 10-K/A on May 14, 2014, Commission File Number 000-33053. |
|
10.26** |
Convertible Promissory Note dated August 7, 2013, issued by the registrant in favor of Hanover Holdings I, LLC, in the amount of $26,500 filed as Exhibit 10.26 to the registrant’s Annual Report on Form 10-K/A on May 14, 2014, Commission File Number 000-33053. |
|
10.27** |
Securities Purchase Agreement dated November 23, 2013, between Hanover Holdings I, LLC and the registrant with respect to the issuance of a Convertible Promissory Note in the amount of $26,500 filed as Exhibit 10.27 to the registrant’s Annual Report on Form 10-K/A on May 14, 2014, Commission File Number 000-33053. |
|
10.28** |
Convertible Promissory Note dated November 23, 2013, issued by the registrant in favor of Hanover Holdings I, LLC, in the amount of $26,500 filed as Exhibit 10.28 to the registrant’s Annual Report on Form 10-K/A on May 14, 2014, Commission File Number 000-33053. |
10.29** |
Securities Purchase Agreement dated December 26, 2012, between Asher Enterprises, Inc. and the registrant with respect to the issuance of a Convertible Promissory Note in the amount of $32,500 filed as Exhibit 10.29 to the registrant’s Annual Report on Form 10-K/A on May 14, 2014, Commission File Number 000-33053. |
10.30** |
Convertible Promissory Note dated December 26, 2012, issued by the registrant in favor of Asher Enterprises, Inc., in the amount of $32,500 filed as Exhibit 10.30 to the registrant’s Annual Report on Form 10-K/A on May 14, 2014, Commission File Number 000-33053. |
10.31** |
Securities Purchase Agreement dated March 1, 2013, between Asher Enterprises, Inc. and the registrant with respect to the issuance of a Convertible Promissory Note in the amount of $32,500 filed as Exhibit 10.31 to the registrant’s Annual Report on Form 10-K/A on May 14, 2014, Commission File Number 000-33053. |
10.32** |
Convertible Promissory Note dated March 1, 2013, issued by the registrant in favor of Asher Enterprises, Inc., in the amount of $32,500 filed as Exhibit 10.32 to the registrant’s Annual Report on Form 10-K/A on May 14, 2014, Commission File Number 000-33053. |
10.33** |
Securities Purchase Agreement dated April 18, 2013, between Asher Enterprises, Inc. and the registrant with respect to the issuance of a Convertible Promissory Note in the amount of $32,500 filed as Exhibit 10.33 to the registrant’s Annual Report on Form 10-K/A on May 14, 2014, Commission File Number 000-33053. |
10.34** |
Convertible Promissory Note dated April 18, 2013, issued by the registrant in favor of Asher Enterprises, Inc., in the amount of $32,500 filed as Exhibit 10.34 to the registrant’s Annual Report on Form 10-K/A on May 14, 2014, Commission File Number 000-33053. |
10.35** |
Securities Purchase Agreement dated November 7, 2013, between Asher Enterprises, Inc. and the registrant with respect to the issuance of a Convertible Promissory Note in the amount of $42,500 filed as Exhibit 10.35 to the registrant’s Annual Report on Form 10-K/A on May 14, 2014, Commission File Number 000-33053. |
10.36** |
Convertible Promissory Note dated November 7, 2013, issued by the registrant in favor of Asher Enterprises, Inc., in the amount of $42,500 filed as Exhibit 10.36 to the registrant’s Annual Report on Form 10-K/A on May 14, 2014, Commission File Number 000-33053. |
10.37** |
Securities Purchase Agreement dated February 6, 2014, between Asher Enterprises, Inc. and the registrant with respect to the issuance of a Convertible Promissory Note in the amount of $37,500 filed as Exhibit 10.37 to the registrant’s Annual Report on Form 10-K/A on May 14, 2014, Commission File Number 000-33053. |
10.38** |
Convertible Promissory Note dated February 6, 2014, issued by the registrant in favor of Asher Enterprises, Inc., in the amount of $37,500 filed as Exhibit 10.38 to the registrant’s Annual Report on Form 10-K/A on May 14, 2014, Commission File Number 000-33053. |
10.39** |
Convertible Promissory Note dated December 31, 2010, issued by Mind Solutions, Inc. in favor of Brent Fouch, in the amount of $157,324.06 filed as Exhibit 10.39 to the registrant’s Annual Report on Form 10-K/A on May 14, 2014, Commission File Number 000-33053. |
10.40** |
Assignment Agreement dated June 5, 2013, by and between Brent Fouch, as assignor, Magna Group, LLC, as assignee, and VOIS, Inc. assigning $106,324 of the Convertible Promissory Note dated December 31, 2010, issued by Mind Solutions, Inc. in favor of Brent Fouch, in the amount of $157,324.06 filed as Exhibit 10.40 to the registrant’s Annual Report on Form 10-K/A on May 14, 2014, Commission File Number 000-33053. |
10.41** |
Debt Conversion Agreement dated April 4, 2013, by and between Brent Fouch and VOIS, Inc. converting $51,000 of the Convertible Promissory Note dated December 31, 2010, issued by Mind Solutions, Inc. in favor of Brent Fouch, in the amount of $157,324.06 into 21,250,000 shares of the registrant filed as Exhibit 10.41 to the registrant’s Annual Report on Form 10-K/A on May 14, 2014, Commission File Number 000-33053. |
10.42** |
Convertible Promissory Note dated December 31, 2011, issued by Mind Solutions, Inc. in favor of Brent Fouch, in the amount of $33,674.05 filed as Exhibit 10.42 to the registrant’s Annual Report on Form 10-K/A on May 14, 2014, Commission File Number 000-33053. |
10.43** |
Convertible Promissory Note dated June 30, 2012, issued by Mind Solutions, Inc. in favor of Brent Fouch, in the amount of $50,435 filed as Exhibit 10.43 to the registrant’s Annual Report on Form 10-K/A on May 14, 2014, Commission File Number 000-33053. |
10.44** |
Assignment Agreement dated February 5, 2013, by and between Brent Fouch, as assignor, Magna Group, LLC, as assignee, and VOIS, Inc. assigning $40,000 of the Convertible Promissory Note dated June 30, 2012, issued by Mind Solutions, Inc. in favor of Brent Fouch, in the amount of $50,435 filed as Exhibit 10.44 to the registrant’s Annual Report on Form 10-K/A on May 14, 2014, Commission File Number 000-33053. |
10.45** |
Convertible Promissory Note dated January 3, 2014, issued by Mind Solutions, Inc. in favor of Brent Fouch, in the amount of $61,096 filed as Exhibit 10.45 to the registrant’s registration statement on Form S-1 on June 27, 2014, Commission File Number 000-33053. |
10.46** |
Assignment Agreement dated June 5, 2014, by and between Brent Fouch, as assignor, Magna Group, LLC, as assignee, and VOIS, Inc. assigning the Convertible Promissory Note dated January 3, 2014, issued by Mind Solutions, Inc. in favor of Brent Fouch, in the amount of $61,096 filed as Exhibit 10.46 to the registrant’s registration statement on Form S-1 on June 27, 2014, Commission File Number 000-33053. |
10.47** |
Convertible Promissory Note dated April 3, 2013, issued by Mind Solutions, Inc. in favor of Brent Fouch, in the amount of $48,872 filed as Exhibit 10.47 to the registrant’s Annual Report on Form 10-K/A on May 14, 2014, Commission File Number 000-33053. |
10.48** |
Assignment Agreement dated November 11, 2013, by and between Brent Fouch, as assignor, Magna Group, LLC, as assignee, and VOIS, Inc. assigning the Convertible Promissory Note dated April 3, 2013, issued by Mind Solutions, Inc. in favor of Brent Fouch, in the amount of $48,872 filed as Exhibit 10.48 to the registrant’s Annual Report on Form 10-K/A on May 14, 2014, Commission File Number 000-33053. |
10.49** |
Convertible Promissory Note dated May 15, 2013, issued by the registrant in favor of JMJ Financial, in the amount of $250,000 filed as Exhibit 10.49 to the registrant’s Annual Report on Form 10-K/A on May 14, 2014, Commission File Number 000-33053. |
10.50** |
Consulting Agreement dated January 2, 2014, by and between Brent Fouch and the registrant filed as Exhibit 10.50 to the registrant’s Annual Report on Form 10-K/A on May 14, 2014, Commission File Number 000-33053. |
10.51** |
Consulting Agreement dated February 12, 2014, by and between Monster Arts, Inc. and the registrant filed as Exhibit 10.51 to the registrant’s Annual Report on Form 10-K/A on May 14, 2014, Commission File Number 000-33053. |
10.52** |
Consulting Agreement dated March 18, 2014, by and between Bret Cusick and the registrant filed as Exhibit 10.52 to the registrant’s Annual Report on Form 10-K/A on May 14, 2014, Commission File Number 000-33053. |
10.53** |
Consulting Agreement dated March 19, 2014, by and between Noah Fouch and the registrant filed as Exhibit 10.53 to the registrant’s Annual Report on Form 10-K/A on May 14, 2014, Commission File Number 000-33053. |
10.54** |
Consulting Agreement dated May 11, 2014, by and between IN2NE Corp. and the registrant filed as Exhibit 10.54 to the registrant’s Annual Report on Form 10-K/A on May 14, 2014, Commission File Number 000-33053. |
10.55** |
Securities Purchase Agreement dated May 8, 2014, between KBM Worldwide, Inc. and the registrant with respect to the issuance of a Convertible Promissory Note in the amount of $42,500 filed as Exhibit 10.54 to the registrant’s Annual Report on Form 10-K/A on May 14, 2014, Commission File Number 000-33053. |
10.56** |
Convertible Promissory Note dated May 8, 2014, issued by the registrant in favor of KBM Worldwide, Inc., in the amount of $42,500 filed as Exhibit 10.56 to the registrant’s Annual Report on Form 10-K/A on May 14, 2014, Commission File Number 000-33053. |
10.57** |
License Agreement as of December 18, 2012, by and among VOIS Inc., a Florida corporation (“Licensee”), and Mind Technologies, Inc., a Nevada corporation (“Licensor”) filed as Exhibit 10.1 to the registrant’s Form 8-K on December 20, 2012, Commission File Number 000-33053. |
10.58** |
Consulting Agreement dated May 2, 2014, by and between Brent Fouch and the registrant filed as Exhibit 10.58 to the registrant’s Annual Report on Form 10-K/A on May 14, 2014, Commission File Number 000-33053. |
10.59** |
Securities Purchase Agreement dated May 8, 2014, between Asher Enterprises, Inc. and the registrant with respect to the issuance of a Convertible Promissory Note in the amount of $42,500 filed as Exhibit 10.59 to the registrant’s Annual Report on Form 10-K/A on May 14, 2014, Commission File Number 000-33053. |
10.60** |
Convertible Promissory Note dated May 8, 2014, issued by the registrant in favor of Asher Enterprises, Inc., in the amount of $42,500 filed as Exhibit 10.60 to the registrant’s Annual Report on Form 10-K/A on May 14, 2014, Commission File Number 000-33053. |
10.61** |
Convertible Promissory Note dated February 4, 2014, issued by the registrant in favor of GEL Properties, LLC in the amount of $25,000 filed as Exhibit 10.61 to the registrant’s Quarterly Report on Form 10-Q on May 15, 2014, Commission File Number 000-33053. |
10.62** |
Securities Purchase Agreement dated February 4, 2014, between LG Capital Funding, LLC and the registrant with respect to the issuance of two Convertible Promissory Notes in the aggregate amount of $50,000 filed as Exhibit 10.62 to the registrant’s Quarterly Report on Form 10-Q on May 15, 2014, Commission File Number 000-33053. |
10.63** |
Convertible Promissory Note dated February 4, 2014, issued by the registrant in favor of LG Capital Funding, LLC in the amount of $25,000 filed as Exhibit 10.63 to the registrant’s Quarterly Report on Form 10-Q on May 15, 2014, Commission File Number 000-33053. |
10.64** |
Convertible Promissory Note dated February 4, 2014, issued by the registrant in favor of LG Capital Funding, LLC in the amount of $25,000 filed as Exhibit 10.64 to the registrant’s Quarterly Report on Form 10-Q on May 15, 2014, Commission File Number 000-33053. |
10.65** |
Securities Purchase Agreement dated March 25, 2014, between LG Capital Funding, LLC and the registrant with respect to the issuance of a Convertible Promissory Note in the amount of $40,000 filed as Exhibit 10.65 to the registrant’s Quarterly Report on Form 10-Q on May 15, 2014, Commission File Number 000-33053. |
10.66** |
Convertible Promissory Note dated March 25, 2014, issued by the registrant in favor of LG Capital Funding, LLC in the amount of $40,000 filed as Exhibit 10.66 to the registrant’s Quarterly Report on Form 10-Q on May 15, 2014, Commission File Number 000-33053. |
10.67** |
Securities Purchase Agreement dated April 15, 2014, between Caesar Capital Group, LLC and the registrant with respect to the issuance of a Convertible Promissory Note in the amount of $50,000 filed as Exhibit 10.67 to the registrant’s Quarterly Report on Form 10-Q on May 15, 2014, Commission File Number 000-33053. |
10.68** |
Convertible Promissory Note dated April 15, 2014, issued by the registrant in favor of Caesar Capital Group, LLC in the amount of $50,000 filed as Exhibit 10.68 to the registrant’s Quarterly Report on Form 10-Q on May 15, 2014, Commission File Number 000-33053. |
10.69** |
Consulting Agreement dated May 12, 2014, by and between Cicero Consulting Group, LLC and the registrant filed as Exhibit 10.69 to the registrant’s Quarterly Report on Form 10-Q on May 15, 2014, Commission File Number 000-33053. |
10.70** |
Convertible Promissory Note dated May 12, 2014, issued by the registrant in favor of Cicero Consulting Group, LLC in the amount of $200,000 filed as Exhibit 10.70 to the registrant’s Quarterly Report on Form 10-Q on May 15, 2014, Commission File Number 000-33053. |
10.71** |
Securities Purchase Agreement dated April 30, 2014, between AARG Corp. and the registrant with respect to the issuance of a Convertible Promissory Note in the amount of $50,000 filed as Exhibit 10.71 to the registrant’s Quarterly Report on Form 10-Q on May 15, 2014, Commission File Number 000-33053. |
10.72** |
Convertible Promissory Note dated April 30, 2014, issued by the registrant in favor of AARG Corp. in the amount of $50,000 filed as Exhibit 10.72 to the registrant’s Quarterly Report on Form 10-Q on May 15, 2014, Commission File Number 000-33053. |
10.73** |
Consulting Agreement dated October 24, 2012, by and between Brent Fouch and the registrant filed as Exhibit 10.73 to the registrant’s Annual Report on Form 10-K/A. Amendment No. 2 on August 1, 2014, Commission File Number 000-33053. |
10.74** |
Consulting Agreement dated December 18, 2012, by and between Brent Fouch and the registrant Consulting Agreement dated October 24, 2012, by and between Brent Fouch and the registrant filed as Exhibit 10.74 to the registrant’s Annual Report on Form 10-K/A. Amendment No. 2 on August 1, 2014, Commission File Number 000-33053. |
10.75** |
Consulting Agreement dated January 30, 2013, by and between Brent Fouch and the registrant Consulting Agreement dated October 24, 2012, by and between Brent Fouch and the registrant filed as Exhibit 10.75 to the registrant’s Annual Report on Form 10-K/A. Amendment No. 2 on August 1, 2014, Commission File Number 000-33053. |
10.76** |
Consulting Agreement dated February 20, 2013, by and between Brent Fouch and the registrant Consulting Agreement dated October 24, 2012, by and between Brent Fouch and the registrant filed as Exhibit 10.76 to the registrant’s Annual Report on Form 10-K/A. Amendment No. 2 on August 1, 2014, Commission File Number 000-33053. |
10.77** |
Consulting Agreement dated September 2, 2013, by and between Brent Fouch and the registrant Consulting Agreement dated October 24, 2012, by and between Brent Fouch and the registrant filed as Exhibit 10.77 to the registrant’s Annual Report on Form 10-K/A. Amendment No. 2 on August 1, 2014, Commission File Number 000-33053. |
10.78** |
Consulting Agreement dated September 26, 2013, by and between Brent Fouch and the registrant Consulting Agreement dated October 24, 2012, by and between Brent Fouch and the registrant filed as Exhibit 10.78 to the registrant’s Annual Report on Form 10-K/A. Amendment No. 2 on August 1, 2014, Commission File Number 000-33053. |
10.79** |
Consulting Agreement dated May 1, 2013, by and between Brent Fouch and the registrant Consulting Agreement dated October 24, 2012, by and between Brent Fouch and the registrant filed as Exhibit 10.79 to the registrant’s Annual Report on Form 10-K/A. Amendment No. 2 on August 1, 2014, Commission File Number 000-33053. |
10.80** |
Consulting Agreement dated July 19, 2013, by and between Brent Fouch and the registrant Consulting Agreement dated October 24, 2012, by and between Brent Fouch and the registrant filed as Exhibit 10.80 to the registrant’s Annual Report on Form 10-K/A. Amendment No. 2 on August 1, 2014, Commission File Number 000-33053. |
10.81** |
Securities Purchase Agreement dated May 30, 2014, between WHC Capital, LLC and the registrant with respect to the issuance of a Convertible Promissory Note in the amount of $60,000 Consulting Agreement dated October 24, 2012, by and between Brent Fouch and the registrant filed as Exhibit 10.81 to the registrant’s Annual Report on Form 10-K/A. Amendment No. 2 on August 1, 2014, Commission File Number 000-33053. |
10.82** |
Convertible Promissory Note dated May 30, 2014, issued by the registrant in favor of WHC Capital, LLC in the amount of $60,000 Consulting Agreement dated October 24, 2012, by and between Brent Fouch and the registrant filed as Exhibit 10.82 to the registrant’s Annual Report on Form 10-K/A. Amendment No. 2 on August 1, 2014, Commission File Number 000-33053. |
10.83** |
Consulting Agreement dated March 18, 2013, by and between Christian Hansen and the registrant Consulting Agreement dated October 24, 2012, by and between Brent Fouch and the registrant filed as Exhibit 10.83 to the registrant’s Annual Report on Form 10-K/A. Amendment No. 2 on August 1, 2014, Commission File Number 000-33053. |
10.84** |
Consulting Agreement dated March 20, 2013, by and between Larry Simon and the registrant filed as Exhibit 10.84 to the registrant’s Annual Report on Form 10-K/A. Amendment No. 2 on August 1, 2014, Commission File Number 000-33053. |
10.85** |
Consulting Agreement dated March 20, 2013, by and between Relaunch Consulting Group and the registrant filed as Exhibit 10.85 to the registrant’s Annual Report on Form 10-K/A. Amendment No. 2 on August 1, 2014, Commission File Number 000-33053. |
10.86** |
Consulting Agreement dated November 11, 2013, by and between Mirador Consulting LLC and the registrant filed as Exhibit 10.86 to the registrant’s Annual Report on Form 10-K/A. Amendment No. 2 on August 1, 2014, Commission File Number 000-33053. |
10.87** |
Consulting Agreement dated November 11, 2013, by and between First Swiss Capital, Inc. and the registrant filed as Exhibit 10.87 to the registrant’s Annual Report on Form 10-K/A. Amendment No. 2 on August 1, 2014, Commission File Number 000-33053. |
10.88** |
Amendment to Equity Purchase Agreement, dated June 19, 2014, between Mind Solutions, Inc. and Premier Venture Partners, LLC date March 11, 2014, filed as Exhibit 10.88 to the registrant’s Annual Report on Form 10-K/A. Amendment No. 2 on August 1, 2014, Commission File Number 000-33053. |
10.89** |
Securities Purchase Agreement dated July 22, 2014, between KBM Worldwide, Inc. and the registrant with respect to the issuance of a Convertible Promissory Note in the amount of $27,500 filed as Exhibit 10.1 to the registrant’s Current Report on Form 8-K on July 31, 2014, Commission File Number 000-33053. |
10.90** |
Convertible Promissory Note dated July 22, 2014, issued by the registrant in favor of KBM Worldwide, Inc., in the amount of $27,500 filed as Exhibit 10.2 to the registrant’s Current Report on Form 8-K on July 31, 2014, Commission File Number 000-33053. |
10.91** |
Note Purchase Agreement dated February 18, 2014, between Iconic Holdings, LLC and the registrant with respect to the issuance of a Convertible Promissory Note in the amount of $220,000 filed as Exhibit 10.1 to the registrant’s Current Report on Form 8-K on July 31, 2014, Commission File Number 000-33053. |
10.92** |
Convertible Promissory Note dated February 18, 2014, issued by the registrant in favor of Iconic Holdings, LLC, in the amount of $220,000 filed as Exhibit 10.2 to the registrant’s Current Report on Form 8-K on July 31, 2014, Commission File Number 000-33053. |
10.93** |
Securities Purchase Agreement dated September 4, 2014, between LG Capital Funding, LLC and the registrant with respect to the issuance of convertible promissory note in the aggregate amount of $63,000, filed as Exhibit 10.1 to the registrant’s Form 8-K/A on September 10, 2014, Commission File Number 000-33053. |
10.94** |
10% Convertible Redeemable Note dated September 4, 2014, issued by the registrant in favor of LG Capital, in the amount of $31,500, filed as Exhibit 10.2 to the registrant’s Form 8-K/A on September 10, 2014, Commission File Number 000-33053. |
10.95** |
Collateralized Secured Promissory Note dated September 4, 2014, issued by the registrant in favor of LG Capital, in the amount of $31,500, filed as Exhibit 10.3 to the registrant’s Form 8-K/A on September 10, 2014, Commission File Number 000-33053. |
10.96** |
Convertible Promissory Note dated September 22, 2014, issued by the registrant in favor of JSJ Investments, Inc., in the amount of $100,000, filed as Exhibit 10.1 to the registrant’s Form 8-K on October 8, 2014, Commission File Number 000-33053. |
10.97** |
Securities Purchase Agreement dated October 29, 2014, between KBM Worldwide, Inc. and the registrant with respect to the issuance of a Convertible Promissory Note in the amount of $32,500, filed as Exhibit 10.1 to the registrant’s Form 8-K on November 3, 2014, Commission File Number 000-33053. |
10.98** |
Convertible Promissory Note dated October 29, 2014, issued by the registrant in favor of KBM Worldwide, Inc., in the amount of $32,500, filed as Exhibit 10.2 to the registrant’s Form 8-K on November 3, 2014, Commission File Number 000-33053. |
10.99** |
Securities Purchase Agreement dated September 4, 2014, between LG Capital Funding, LLC and the registrant with respect to the issuance of convertible promissory note in the aggregate amount of $63,000, filed as Exhibit 10.1 to the registrant’s Form 8-K on September 10, 2014, Commission File Number 000-33053. |
10.100** |
10% Convertible Redeemable Note dated September 4, 2014, issued by the registrant in favor of LG Capital, in the amount of $31,500, filed as Exhibit 10.21 to the registrant’s Form 8-K on September 10, 2014, Commission File Number 000-33053. |
10.101** |
Collateralized Secured Promissory Note dated September 4, 2014, issued by the registrant in favor of LG Capital, in the amount of $31,500, filed as Exhibit 10.3 to the registrant’s Form 8-K on September 10, 2014, Commission File Number 000-33053. |
10.102** |
Convertible Promissory Note dated September 22, 2014, issued by the registrant in favor of JSJ Investments, Inc., in the amount of $100,000, filed as Exhibit 10.13 to the registrant’s Form 8-K on October 8, 2014, Commission File Number 000-33053. |
10.103** |
Securities Purchase Agreement dated October 29, 2014, between KBM Worldwide, Inc. and the registrant with respect to the issuance of a Convertible Promissory Note in the amount of $32,500, filed as Exhibit 10.1 to the registrant’s Form 8-K on November 3, 2014, Commission File Number 000-33053. |
10.104** |
Convertible Promissory Note dated October 29, 2014, issued by the registrant in favor of KBM Worldwide, Inc., in the amount of $32,500, filed as Exhibit 10.2 to the registrant’s Form 8-K on November 3, 2014, Commission File Number 000-33053. |
10.105* |
Securities Purchase Agreement dated February 10, 2015, between LG Capital Funding, LLC, and the registrant with respect to the issuance of a Convertible Promissory Note in the amount of $31,500. |
10.106* |
Convertible Promissory Note date February 10, 2015, issued by the registrant in favor of LG Capital Funding, LLC in the amount of $31,500. |
31.1* |
Certification of Kerry Driscoll, Chief Executive Officer of Mind Solutions, Inc., pursuant to 18 U.S.C. §1350, as adopted pursuant to §302 of the Sarbanes-Oxley Act of 2002. |
|
31.2* |
Certification of Kerry Driscoll, Chief Financial Officer and Principal Accounting Officer of Mind Solutions, Inc., pursuant to 18 U.S.C. §1350, as adopted pursuant to §302 of the Sarbanes-Oxley Act of 2002. |
|
32.1* |
Certification of Kerry Driscoll, Chief Executive Officer of Mind Solutions, Inc., pursuant to 18 U.S.C. §1350, as adopted pursuant to §906 of the Sarbanes-Oxley Act of 2002. |
|
32.2* |
Certification of Kerry Driscoll, Chief Financial Officer and Principal Accounting Officer of Mind Solutions, Inc., pursuant to 18 U.S.C. §1350, as adopted pursuant to §906 of the Sarbanes-Oxley Act of 2002. |
|
____________
* Filed herewith.
** Previously filed.
SIGNATURES
In accordance with Section 13 or 15(d)
of the Securities Exchange Act of 1934, as amended, the registrant has duly caused this report to be signed on its behalf by the
undersigned, thereunto duly authorized.
MIND SOLUTIONS, INC.
Date: March 10, 2015.
By /s/ Kerry Driscoll
Kerry Driscoll, Chief
Executive Officer
By /s/ Kerry Driscoll
Kerry Driscoll, Chief Financial Officer and Principal Accounting Officer
Pursuant to the requirements of the Securities
Exchange Act of 1934, as amended, this report has been signed by the following persons on behalf of the registrant and in the capacities
and on the dates indicated.
Signature |
|
Title |
|
Date |
/s/ Kerry Driscoll
KERRY DRISCOLL |
|
Chairman, President Chief Executive Officer, Chief Financial Officer, Principal Accounting Officer, and Secretary |
|
March 10, 2015 |
TERRY L. JOHNSON, CPA
406 Greyford Lane
Casselberry, Florida 32707
Phone 407-721-4753
Fax/Voice Message 866-813-3428
E-mail cpatlj@yahoo.com
REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
To the Stockholders and Board of Directors
Mind Solutions, Inc.,
I have audited the accompanying balance sheets
of Mind Solutions, Inc. as of December 31, 2014 and 2013 and the statements of operations, stockholders’ equity, and cash
flows for the years ended December 31, 2014 and 2013. These financial statements are the responsibility of the Company’s
management. My responsibility is to express an opinion on these financial statements based on my audit.
Management’s
Responsibility for Financial Statements
Management is responsible
for the preparation and fair presentation of these consolidated financial statements in accordance with accounting principles generally
accepted in the United State of America; this includes the design, implementation and maintenance of internal control relevant
to the preparation and fair presentation of financial statements that are free from material misstatement, whether due to fraud
or error.
Auditor’s
Responsibility
My responsibility
is to express an opinion on these consolidated financial statements based on my audits. I conducted my audits in accordance with
the standards of the Public Company Accounting Oversight Board (United States). Those standards require that I plan and perform
the audit to obtain reasonable assurance about whether the consolidated financial statements are free of material misstatement.
The Company is not required to have, nor was I engaged to perform, an audit of its internal control over financial reporting. My
audits included consideration of internal control over financial reporting as a basis for designing audit procedures that are appropriate
in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Company’s internal control
over financial reporting. Accordingly, I express no such opinion. An audit also includes examining, on a test basis, evidence supporting
the amounts and disclosures in the consolidated financial statements. An audit also includes assessing the accounting principles
used and significant estimates made by management, as well as evaluating the overall consolidated financial statement presentation. I
believe that my audits provide a reasonable basis for my opinion.
Opinion
In my opinion, the financial statements referred
to above present fairly, in all material respects, the financial position of Mind Solutions, Inc. as of December 31, 2014 and 2013
and the results of its operations and its cash flows for the years ended December 31, 2014 and 2013 in conformity with accounting
principles generally accepted in the United States.
Emphasis of Matter
The accompanying financial statements have
been prepared assuming the Company will continue as a going concern. As discussed in Note 4 to the financial statements, the Company
has a minimum cash balance available for payment of ongoing operating expenses, has experienced losses from operations since inception,
and it does not have a source of revenue sufficient to cover its operating costs. These factors raise substantial doubt about the
Company’s ability to continue as a going concern. Management’s plans in this regard are described in Note 4. The financial
statements do not include any adjustments that might result from the outcome of this uncertainty.
/s/ Terry L. Johnson, CPA
Casselberry, Florida
March 3, 2015
MIND SOLUTIONS, INC. |
BALANCE SHEETS
(Development Stage Registrant) |
| |
| | | |
| | |
| |
| | | |
| | |
| |
| December 31, | | |
| December 31, | |
Assets: | |
| 2014 | | |
| 2013 | |
Current Assets | |
| | | |
| | |
Cash and Cash Equivalents | |
$ | 113,199 | | |
$ | 47,428 | |
Prepaids | |
| 46,020 | | |
| 289,550 | |
Total Current Assets | |
| 159,219 | | |
| 336,978 | |
| |
| | | |
| | |
Fixed Assets | |
| | | |
| | |
Property Plant & Equipment | |
| 89,653 | | |
| 86,717 | |
Accumulated Depreciation | |
| (86,876 | ) | |
| (84,299 | ) |
Total Fixed Assets | |
| 2,777 | | |
| 2,418 | |
| |
| | | |
| | |
Other Assets | |
| | | |
| | |
Marketable Securities: Available-for-Sale | |
| 3,958 | | |
| — | |
Total Other Assets | |
| 3,958 | | |
| — | |
| |
| | | |
| | |
Total Assets | |
$ | 165,954 | | |
$ | 339,396 | |
| |
| | | |
| | |
Liabilities and Stockholders' Equity: | |
| | | |
| | |
Accounts Payable & Accrued Expenses | |
$ | 389,165 | | |
$ | 394,859 | |
Accounts Payable to Related Parties | |
| 3,500 | | |
| 3,500 | |
Accrued Interest | |
| 342,647 | | |
| 277,560 | |
Notes Payable | |
| 145,000 | | |
| 145,000 | |
Convertible Notes Payable | |
| 451,728 | | |
| 248,358 | |
Derivative Liability | |
| 1,767,223 | | |
| 19,907,242 | |
Total Liabilities | |
| 3,099,263 | | |
| 20,976,519 | |
| |
| | | |
| | |
Stockholders' Equity: | |
| | | |
| | |
Series A Preferred Stock, $0.001 par value 10,000,000 | |
| | | |
| | |
shares authorized, 10,000,000 shares issued and outstanding | |
| 10,000 | | |
| — | |
Common Stock, $0.001 par value 5,000,000,000 | |
| | | |
| | |
shares authorized, 1,388,783,762 and 36,024,969 shares | |
| | | |
| | |
issued and outstanding | |
| 1,388,784 | | |
| 36,025 | |
Stock Payable | |
| 36,605 | | |
| 235,375 | |
Additional Paid-In Capital | |
| 16,949,368 | | |
| 2,807,266 | |
Accumulated Comprehensive Loss | |
| (426,042 | ) | |
| (330,000 | ) |
Deficit Accumulated During the Development Stage | |
| (20,892,024 | ) | |
| (23,385,789 | ) |
Total Stockholders' Equity (Deficit) | |
| (2,933,309 | ) | |
| (20,637,123 | ) |
| |
| | | |
| | |
Total Liabilities and Stockholders' Equity | |
$ | 165,954 | | |
$ | 339,396 | |
| |
| | | |
| | |
The accompanying notes are an integral part of these financial statements. |
MIND SOLUTIONS, INC. |
STATEMENTS OF OPERATIONS |
(Development Stage Registrant) |
| |
| |
| |
|
| |
| |
| |
|
| |
| |
| |
From Inception |
| |
| |
| |
(May 24, 2002) to |
| |
For the Years Ended December 31, | |
December 31, |
| |
2014 | |
2013 | |
2014 |
| |
| |
| |
|
Product Revenues | |
$ | 534 | | |
$ | 1,163 | | |
$ | 1,697 | |
Service Revenues | |
| 100,000 | | |
| — | | |
| 100,000 | |
Total Revenues | |
| 100,534 | | |
| 1,163 | | |
| 101,697 | |
| |
| | | |
| | | |
| | |
Cost of Sales | |
| 174 | | |
| 678 | | |
| 852 | |
| |
| | | |
| | | |
| | |
Gross Profit | |
| 100,360 | | |
| 485 | | |
| 100,845 | |
| |
| | | |
| | | |
| | |
Operating expenses: | |
| | | |
| | | |
| | |
Consulting | |
| 1,125,289 | | |
| 1,603,037 | | |
| 2,807,758 | |
Officer compensation | |
| 160,000 | | |
| 289,748 | | |
| 449,748 | |
Professional Fees | |
| 201,595 | | |
| 229,420 | | |
| 431,015 | |
General and Administration | |
| 54,013 | | |
| 48,564 | | |
| 1,257,618 | |
Total operating expenses | |
| 1,540,897 | | |
| 2,170,769 | | |
| 4,946,139 | |
| |
| | | |
| | | |
| | |
Loss from operations | |
| (1,440,537 | ) | |
| (2,170,284 | ) | |
| (4,845,294 | ) |
| |
| | | |
| | | |
| | |
Other Income and (Expenses): | |
| | | |
| | | |
| | |
Interest Expense | |
| (143,332 | ) | |
| (46,834 | ) | |
| (199,009 | ) |
Gain/(Loss) on Derivative adjustment | |
| 4,077,634 | | |
| (20,036,965 | ) | |
| (15,959,331 | ) |
Forgiveness of Debt | |
| — | | |
| 111,610 | | |
| 111,610 | |
Total Other Income and (Expenses) | |
| 3,934,302 | | |
| (19,972,189 | ) | |
| (16,046,730 | ) |
| |
| | | |
| | | |
| | |
Net Gain (Loss) before taxes | |
| 2,493,765 | | |
| (22,142,473 | ) | |
| (20,892,024 | ) |
| |
| | | |
| | | |
| | |
Tax provisions | |
| — | | |
| — | | |
| — | |
| |
| | | |
| | | |
| | |
Net Gain (Loss) After Taxes | |
$ | 2,493,765 | | |
$ | (22,142,473 | ) | |
$ | (20,892,024 | ) |
| |
| | | |
| | | |
| | |
Other Comprehensive Income: | |
| | | |
| | | |
| | |
Gain (Loss) on Available-for-Sale Securities | |
| (96,042 | ) | |
| 90,000 | | |
| (426,042 | ) |
| |
| | | |
| | | |
| | |
Other Comprehensive Income (Loss) | |
$ | 2,397,723 | | |
$ | (22,052,473 | ) | |
$ | (21,318,066 | ) |
| |
| | | |
| | | |
| | |
Basic & diluted loss per share | |
$ | 0.00 | | |
$ | (1.34 | ) | |
| | |
| |
| | | |
| | | |
| | |
Weighted average shares outstanding | |
| 698,853,974 | | |
| 16,468,592 | | |
| | |
| |
| | | |
| | | |
| | |
The accompanying notes are an integral part of these financial statements. |
MIND SOLUTIONS, INC. |
STATEMENTS OF STOCKHOLDERS' EQUITY (DEFICIT) |
(Development Stage Registrant) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Additional |
|
Accumulated |
|
|
|
Common Stock |
Preferred Stock |
Paid in |
Stock |
Comprehensive |
Accumulated |
|
|
Shares |
Amount |
Shares |
Amount |
Capital |
Payable |
Income (loss) |
Deficit |
Total |
Balance May 24, 2002 |
- |
$ - |
- |
$ - |
$ - |
$ - |
$ - |
$ - |
$ - |
Shares issued to founder |
23,516 |
24 |
- |
- |
76 |
- |
- |
- |
100 |
Net loss for year |
- |
- |
- |
- |
- |
- |
- |
(100) |
(100) |
Balance December 31, 2002 |
23,516 |
24 |
- |
- |
76 |
- |
- |
(100) |
- |
|
|
|
|
|
|
|
|
|
|
Net loss for year |
- |
- |
- |
- |
- |
- |
- |
- |
- |
Balance December 31, 2003 |
23,516 |
24 |
- |
- |
76 |
- |
- |
(100) |
- |
|
|
|
|
|
|
|
|
|
|
Net loss for year |
- |
- |
- |
- |
- |
- |
- |
- |
- |
Balance December 31, 2004 |
23,516 |
24 |
- |
- |
76 |
- |
- |
(100) |
- |
|
|
|
|
|
|
|
|
|
|
Net loss for year |
- |
- |
- |
- |
- |
- |
- |
- |
- |
Balance December 31, 2005 |
23,516 |
24 |
- |
- |
76 |
- |
- |
(100) |
- |
|
|
|
|
|
|
|
|
|
|
Net loss for year |
- |
- |
- |
- |
- |
- |
- |
- |
- |
Balance December 31, 2006 |
23,516 |
24 |
- |
- |
76 |
- |
- |
(100) |
- |
|
|
|
|
|
|
|
|
|
|
Net loss for year |
- |
- |
- |
- |
- |
- |
- |
- |
- |
Balance December 31, 2007 |
23,516 |
24 |
- |
- |
76 |
- |
- |
(100) |
- |
|
|
|
|
|
|
|
|
|
|
Net loss for year |
- |
- |
- |
- |
- |
- |
- |
- |
- |
Balance December 31, 2008 |
23,516 |
24 |
- |
- |
76 |
- |
- |
(100) |
- |
|
|
|
|
|
|
|
|
|
|
Net loss for year |
- |
- |
- |
- |
- |
- |
- |
- |
- |
Balance December 31, 2009 |
23,516 |
24 |
- |
- |
76 |
- |
- |
(100) |
- |
|
|
|
|
|
|
|
|
|
|
Net loss for year |
- |
- |
|
|
- |
- |
- |
(145,634) |
(145,634) |
Balance December 31, 2010 |
23,516 |
24 |
- |
- |
76 |
- |
- |
(145,734) |
(145,634) |
|
|
|
|
|
|
|
|
|
- |
Investment |
- |
- |
- |
- |
810,000 |
- |
210,000 |
- |
1,020,000 |
Net loss for year |
- |
- |
|
|
- |
- |
- |
(150,656) |
(150,656) |
Balance December 31, 2011 |
23,516 |
24 |
- |
- |
810,076 |
- |
210,000 |
(296,390) |
723,710 |
|
|
|
|
|
|
|
|
|
|
Recapitalization |
98,000 |
98 |
- |
- |
(806,351) |
- |
- |
- |
(806,253) |
Capital contribution from officer |
- |
- |
- |
- |
61,000 |
- |
- |
- |
61,000 |
Investment adjustment to fmv |
- |
- |
- |
- |
- |
- |
(630,000) |
- |
(630,000) |
Stock issued for cash |
250 |
1 |
- |
- |
9,999 |
- |
- |
- |
10,000 |
Stock issued for services |
5,200 |
5 |
- |
- |
775,995 |
- |
- |
- |
776,000 |
Stock issued for licensing agreement |
3,500 |
2 |
- |
- |
(2) |
- |
- |
- |
- |
Net loss for year |
- |
- |
- |
- |
- |
- |
|
(946,926) |
(946,926) |
Balance December 31, 2012 |
130,466 |
130 |
- |
- |
850,717 |
- |
(420,000) |
(1,243,316) |
(812,469) |
|
|
|
|
|
|
|
|
|
|
Investment adjustment to fmv |
- |
- |
- |
- |
- |
- |
90,000 |
- |
90,000 |
Stock issued for services |
22,088,000 |
22,088 |
- |
- |
1,445,615 |
- |
- |
- |
1,467,703 |
Stock payable to IBC Funds LLC |
- |
- |
- |
- |
- |
15,375 |
- |
- |
15,375 |
Stock payable for services |
- |
- |
- |
- |
- |
220,000 |
- |
- |
220,000 |
Stock issued for debt reduction |
13,777,673 |
13,778 |
- |
- |
455,568 |
- |
- |
- |
469,346 |
Stock issued for related party |
|
|
|
|
|
|
|
|
|
debt reductions |
10,625 |
11 |
- |
- |
50,989 |
- |
- |
- |
51,000 |
Asset purchase agreement |
15,000 |
15 |
- |
- |
4,380 |
- |
- |
- |
4,395 |
Rounding adj per reverse split |
3,205 |
3 |
- |
- |
(3) |
- |
- |
- |
- |
Net loss for year ended |
|
|
|
|
|
- |
|
|
|
December 31, 2013 |
- |
- |
- |
- |
- |
- |
- |
(22,142,473) |
(22,142,473) |
Balance December 31, 2013 |
36,024,969 |
36,025 |
- |
- |
2,807,266 |
235,375 |
(330,000) |
(23,385,789) |
(20,637,123) |
|
|
|
|
|
|
|
|
|
|
Available-for-sale securities adj. |
- |
- |
- |
- |
- |
- |
(96,042) |
- |
(96,042) |
Stock issued for services |
252,895,776 |
252,896 |
10,000,000 |
10,000 |
299,465 |
- |
- |
- |
562,361 |
Stock issued for reduction of debt |
1,099,863,017 |
1,099,863 |
- |
- |
(219,747) |
- |
- |
- |
880,116 |
Stock payable for reduction of debt |
- |
- |
- |
- |
- |
21,230 |
- |
- |
21,230 |
Stock payable for services |
- |
- |
- |
- |
- |
(220,000) |
- |
- |
(220,000) |
Derivative liability |
- |
- |
- |
- |
14,062,384 |
- |
- |
- |
14,062,384 |
Net loss for the year ended |
|
|
|
|
|
|
|
|
- |
December 31, 2014 |
- |
- |
- |
- |
- |
- |
- |
2,493,765 |
2,493,765 |
Balance December 31, 2014 |
1,388,783,762 |
$ 1,388,784 |
10,000,000 |
$10,000 |
$ 16,949,368 |
$ 36,605 |
$ (426,042) |
$(20,892,024) |
$ (2,933,309) |
|
|
|
|
|
|
|
|
|
|
The accompanying notes are an integral part of these financial statements. |
MIND SOLUTIONS, INC. |
STATEMENTS OF CASH FLOWS |
(Development Stage Registrant) |
|
| |
| |
| |
From Inception |
| |
For the Years Ended | |
(May 24, 2002) to |
| |
December 31, | |
December 31, |
| |
2014 | |
2013 | |
2014 |
CASH FLOWS FROM OPERATING ACTIVITIES: | |
| | | |
| | | |
| | |
Net Gain (Loss) for the period | |
$ | 2,493,765 | | |
$ | (22,142,473 | ) | |
$ | (20,892,024 | ) |
Adjustments to reconcile net loss to net cash | |
| | | |
| | | |
| | |
provided by operating activities: | |
| | | |
| | | |
| | |
Stock for services | |
| 562,361 | | |
| 1,467,703 | | |
| 2,806,164 | |
Derivative (gain)/loss adjustment | |
| (4,077,634 | ) | |
| 19,907,242 | | |
| 15,829,608 | |
Available-for-sale securities transferred as compensation | |
| — | | |
| 480,000 | | |
| 480,000 | |
Available-for-sale securities received for service revenues | |
| 100,000 | | |
| — | | |
| 100,000 | |
Forgiveness of debt | |
| — | | |
| (111,610 | ) | |
| (111,610 | ) |
Original issue discount | |
| 57,139 | | |
| — | | |
| 57,139 | |
Depreciation | |
| 2,577 | | |
| 2,442 | | |
| 5,237 | |
Changes in Operated Assets and Liabilities: | |
| | | |
| | | |
| | |
Accounts payable and accrued expenses | |
| 80,499 | | |
| 4,907 | | |
| 91,665 | |
Accounts payable to related parties | |
| — | | |
| 3,612 | | |
| 115,110 | |
Net cash used in operating activities | |
| (781,293 | ) | |
| (388,177 | ) | |
| (1,518,711 | ) |
| |
| | | |
| | | |
| | |
CASH FLOW FROM INVESTING ACTIVITIES: | |
| | | |
| | | |
| | |
Purchase Equipment | |
| (2,936 | ) | |
| — | | |
| (3,620 | ) |
Net cash used by investing activities | |
| (2,936 | ) | |
| — | | |
| (3,620 | ) |
| |
| | | |
| | | |
| | |
CASH FLOWS FROM FINANCING ACTIVITIES: | |
| | | |
| | | |
| | |
Proceeds from sale of stock | |
| — | | |
| — | | |
| 10,000 | |
Proceeds from officer contributions | |
| — | | |
| — | | |
| 61,000 | |
Proceeds from convertible notes | |
| 850,000 | | |
| 425,345 | | |
| 1,275,345 | |
Proceed from convertible note to related party | |
| — | | |
| 48,526 | | |
| 48,526 | |
Payments on convertible note to related party | |
| — | | |
| (38,474 | ) | |
| (38,474 | ) |
Proceeds from notes payable to related parties | |
| — | | |
| — | | |
| 418,769 | |
Payments on notes payable to related parties | |
| — | | |
| — | | |
| (139,636 | ) |
Net cash provided by financing activities | |
| 850,000 | | |
| 435,397 | | |
| 1,635,530 | |
| |
| | | |
| | | |
| | |
Net (Decrease) Increase in Cash | |
| 65,771 | | |
| 47,220 | | |
| 113,199 | |
Cash at Beginning of Period | |
| 47,428 | | |
| 208 | | |
| — | |
Cash at End of Period | |
$ | 113,199 | | |
$ | 47,428 | | |
$ | 113,199 | |
| |
| | | |
| | | |
| | |
Supplemental Disclosures: | |
| | | |
| | | |
| | |
Income Taxes Paid | |
$ | — | | |
$ | — | | |
$ | — | |
Interest Paid | |
$ | — | | |
$ | — | | |
$ | — | |
| |
| | | |
| | | |
| | |
NON-CASH INVESTING AND FINANCING ACTIVITIES: | |
| | | |
| | | |
| | |
Issuance of common stock in payment of non related | |
| | | |
| | | |
| | |
party convertible debt | |
$ | 880,116 | | |
$ | 469,346 | | |
$ | 1,349,462 | |
| |
| | | |
| | | |
| | |
Issuance of common stock in payment of related party debt | |
$ | — | | |
$ | 51,000 | | |
$ | 51,000 | |
| |
| | | |
| | | |
| | |
Issuance of convertible note for consulting services | |
$ | 200,000 | | |
$ | — | | |
$ | 200,000 | |
| |
| | | |
| | | |
| | |
Consulting fees paid with available-for-sale securities | |
| | | |
| | | |
| | |
asset | |
$ | — | | |
$ | 480,000 | | |
$ | 480,000 | |
| |
| | | |
| | | |
| | |
Stock issued for assets | |
$ | — | | |
$ | 90,000 | | |
$ | 90,000 | |
| |
| | | |
| | | |
| | |
The accompanying notes are an integral part of these financial statements. |
MIND SOLUTIONS, INC.
(A Development Stage registrant)
NOTES TO FINANCIAL STATEMENTS
DECEMBER 31, 2014 AND 2013
NOTE 1-ORGANIZATION
AND DESCRIPTION
OF BUSINESS
Mind Solutions, Inc. (the “registrant”)
was initially incorporated in the state of Delaware on May 19, 2000 as Medical Records by Net, Inc. On October 17, 2000, the
registrant changed its name to Lifelink Online, Inc. In January 2001, its name was changed to MedStrong Corporation, and on March
9, 2001, the registrant name was changed to MedStrong International Corporation. On March 30, 2007, the registrant’s name
was changed to VOIS, Inc. and the domicile was changed to the State of Florida. On October 19, 2012, the registrant executed a
merger agreement with Mind Solutions, Inc. whereas Mind Solutions, Inc. became a wholly owned subsidiary of the registrant. Mind
Solutions, Inc. was incorporated under the laws of Nevada on May 24, 2002, under the name Red Meteor Media, Inc. The registrant
changed its name to Prize Entertainment, Inc. in November 2003, and then again to Mind Solutions, Inc. in January 2011. On October
28, 2013, the registrant changed its name from VOIS, Inc. to Mind Solutions, Inc. as well as changing its domicile from Florida
to Nevada.
On October 28, 2013, the registrant closed an
Agreement and Plan of Merger with Mind Solutions, Inc. For accounting purposes this agreement was treated as a reverse merger.
The operations of the registrant became those solely of Mind Solutions, Inc. In connection with the merger agreement, the registrant
changed its fiscal year end to coincide with that of Mind Solutions, Inc., which is December 31. Pursuant to the Plan of Merger
with Mind Solutions, Inc., the holders of stock in VOIS, Inc. received one share of common stock, $0.001 par value per share, in
Mind Solutions, Inc. for every 2,000 shares of common stock in VOIS, Inc. (in effect, a one for 2,000 reverse split). As a result,
the then current common stockholders of VOIS, Inc. held all of the issued and outstanding shares of common stock in the surviving
corporation Mind Solutions, Inc.
The registrant has developed
software
applications which are compatible with
EEG headsets on the market. The registrant is working with the most advanced electronics manufacturing
companies to develop the most advanced EEG headset on the market. This BCI headset will allow users to operate thought-controlled
applications on their mobile phone devices as well as on traditional PC computers. The registrant has completed a working
prototype which has been successfully tested on several Android devices. EEG headset can read
brainwaves and allow
for interaction with
a computer.
The registrant develops software for thought
controlled technologies, allowing the user to interact with the computer and other machines through the power of the mind. The
technology involves the use of a wireless headset, which detects brainwaves on both the conscious and non-conscious level. This
revolutionary neural processing technology makes it possible for computers to interact directly with the human brain. The registrant
has created three applications currently available through the registrant’s website and is developing a micro EEG headset
that is compatible with mobile smart phones and other devices.
NOTE 2 - PREPARATION OF FINANCIAL STATEMENTS
Basis of presentation
The registrant’s financial statements
have been prepared in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”).
Development Stage registrant
The registrant is currently a development stage
enterprise reporting under the provisions of FASB ASC Topic 915, Development Stage Entity. The accompanying financial statements
have been prepared in accordance with accounting principles generally accepted in the United States of America.
Restated Financial Statements
Certain amounts in the prior period financial
statements have been adjusted to conform to the one for 2,000 reverse stock split on October 15, 2013.
Prior Year Financial Statement Presentation
The prior year financial statements were prepared
to show the effect of the reverse merger and to show the mark to market adjustment as other comprehensive income for comparative
purposes in the prior year financial statements.
NOTE 3-
SUMMARY OF SIGNIFICANT
ACCOUNTING
POLICIES
The
registrant considers
all cash on hand
and in banks,
including
accounts in book overdraft
positions, certificates of
deposit and
other highly-liquid
investments with maturities
of three months
or less, when
purchased,
to be cash and equivalents.
Fixed assets are recorded at cost.
Major renewals and improvements
are capitalized, while maintenance
and repairs are expensed
when incurred.
Expenditures for major additions and betterments are capitalized in amounts greater or equal to $1,000. Depreciation of equipment
is computed by the straight-line method (after taking into account their respective estimated residual values) over the assets
estimated useful life of three, five (5), or seven (7) years. Upon sale or retirement of equipment, the related cost and accumulated
depreciation are removed from the accounts and any gain or loss is reflected in statements of operations.
C. Advertising
expenses
Advertising
and marketing expenses
are charged
to operations
as incurred.
For the year ended
December 31, 2014 and 2013, advertising
and marketing
expense
were $11,815 and $4,735, respectively.
D. Revenue recognition
The registrant follows paragraph 605-10-S99-1
of the FASB Accounting Standards Codification for revenue recognition. The registrant will recognize revenue when it is realized
or realizable and earned. The registrant considers revenue realized or realizable and earned when all of the following criteria
are met: (i) persuasive evidence of an arrangement exists, (ii) the product has been shipped or the services have been rendered
to the customer, (iii) the sales price is fixed or determinable, and (iv) collectability is reasonably assured.
E. Stock-based
compensation
The Company accounts for
equity instruments issued to parties other than employees for acquiring goods or services under guidance of Sub-topic 505-50 of
the FASB Accounting Standards Codification (“Sub-topic 505-50”).
Pursuant to ASC
Section 505-50-30, all transactions in which goods or services are the consideration received for the issuance of equity
instruments are accounted for based on the fair value of the consideration received or the fair value of the equity
instrument issued, whichever is more reliably measurable. The measurement date used to determine the fair value of the equity
instrument issued is the earlier of the date on which the performance is complete or the date on which it is probable that
performance will occur. If the Company is a newly formed corporation or shares of the Company are thinly traded the use of
share prices established in the Company’s most recent private placement memorandum (“PPM”), or weekly or
monthly price observations would generally be more appropriate than the use of daily price observations as such shares could
be artificially inflated due to a larger spread between the bid and asked quotes and lack of consistent trading in the
market.
The fair value of share
options and similar instruments is estimated on the date of grant using a Black-Scholes option-pricing valuation model. The ranges
of assumptions for inputs are as follows:
|
● |
Expected term of share options and similar instruments: Pursuant to Paragraph 718-10-50-2(f)(2)(i) of the FASB Accounting Standards Codification the expected term of share options and similar instruments represents the period of time the options and similar instruments are expected to be outstanding taking into consideration of the contractual term of the instruments and holder’s expected exercise behavior into the fair value (or calculated value) of the instruments. The Company uses historical data to estimate holder’s expected exercise behavior. If the Company is a newly formed corporation or shares of the Company are thinly traded the contractual term of the share options and similar instruments is used as the expected term of share options and similar instruments as the Company does not have sufficient historical exercise data to provide a reasonable basis upon which to estimate expected term. |
|
|
|
|
● |
Expected volatility of the entity’s shares and the method used to estimate it. Pursuant to ASC Paragraph 718-10-50-2(f)(2)(ii) a thinly-traded or nonpublic entity that uses the calculated value method shall disclose the reasons why it is not practicable for the Company to estimate the expected volatility of its share price, the appropriate industry sector index that it has selected, the reasons for selecting that particular index, and how it has calculated historical volatility using that index. The Company uses the average historical volatility of the comparable companies over the expected contractual life of the share options or similar instruments as its expected volatility. If shares of a company are thinly traded the use of weekly or monthly price observations would generally be more appropriate than the use of daily price observations as the volatility calculation using daily observations for such shares could be artificially inflated due to a larger spread between the bid and asked quotes and lack of consistent trading in the market. |
|
|
|
|
● |
Expected annual rate of quarterly dividends. An entity that uses a method that employs different dividend rates during the contractual term shall disclose the range of expected dividends used and the weighted-average expected dividends. The expected dividend yield is based on the Company’s current dividend yield as the best estimate of projected dividend yield for periods within the expected term of the share options and similar instruments. |
Risk-free rate(s). An entity that
uses a method that employs different risk-free rates shall disclose the range of risk-free rates used. The risk-free
interest rate is based on the U.S. Treasury yield curve in effect at the time of grant for periods within the expected term of
the share options and similar instruments.
Pursuant to ASC paragraph
505-50-25-7, if fully vested, non-forfeitable equity instruments are issued at the date the grantor and grantee enter into an agreement
for goods or services (no specific performance is required by the grantee to retain those equity instruments), then, because of
the elimination of any obligation on the part of the counterparty to earn the equity instruments, a measurement date has been reached.
A grantor shall recognize the equity instruments when they are issued (in most cases, when the agreement is entered into). Whether
the corresponding cost is an immediate expense or a prepaid asset (or whether the debit should be characterized as contra-equity
under the requirements of paragraph 505-50-45-1) depends on the specific facts and circumstances. Pursuant to ASC paragraph 505-50-45-1,
a grantor may conclude that an asset (other than a note or a receivable) has been received in return for fully vested, non-forfeitable
equity instruments that are issued at the date the grantor and grantee enter into an agreement for goods or services (and no specific
performance is required by the grantee in order to retain those equity instruments). Such an asset shall not be displayed as contra-equity
by the grantor of the equity instruments. The transferability (or lack thereof) of the equity instruments shall not affect the
balance sheet display of the asset. This guidance is limited to transactions in which equity instruments are transferred to other
than employees in exchange for goods or services. Section 505-50-30 provides guidance on the determination of the measurement date
for transactions that are within the scope of this Subtopic.
Pursuant to
Paragraphs 505-50-25-8 and 505-50-25-9, an entity may grant fully vested, non-forfeitable equity instruments that are
exercisable by the grantee only after a specified period of time if the terms of the agreement provide for earlier
exercisability if the grantee achieves specified performance conditions. Any measured cost of the transaction shall be
recognized in the same period(s) and in the same manner as if the entity had paid cash for the goods or services or used cash
rebates as a sales discount instead of paying with, or using, the equity instruments. A recognized asset, expense, or sales
discount shall not be reversed if a share option and similar instrument that the counterparty has the right to exercise
expires unexercised.
Pursuant to ASC paragraph
505-50-30-S99-1, if the Company receives a right to receive future services in exchange for unvested, forfeitable equity instruments,
those equity instruments are treated as unissued for accounting purposes until the future services are received (that is, the instruments
are not considered issued until they vest). Consequently, there would be no recognition at the measurement date and no entry should
be recorded.
F. Income
Taxes
The registrant adopted FASB ASC Topic 740, Income
Taxes, at its inception. Under FASB ASC Topic 740, the deferred tax provision is determined under the liability method. Under this
method, deferred tax assets and liabilities are recognized based on the differences between the financial statement carrying amounts
and the tax bases of assets and liabilities using presently enacted tax rates.
G. Earnings
(loss) per share
The registrant adopted FASB ASC Topic 260, Earnings
Per Share. Basic earnings per share is based on the weighted effect of all common shares issued and outstanding and is calculated
by dividing net income (loss) available to common stockholders by the weighted average shares outstanding during the period. Diluted
earnings per share is calculated by dividing net income available to common stockholders by the weighted average number of common
shares used in the basic earnings per share calculation plus the number of common shares, if any, that would be issued assuming
conversion of all potentially dilutive securities outstanding. For all periods diluted earnings per share is not presented, as
potentially issuable securities are anti-dilutive.
There are approximately 655,525,261 potentially
dilutive post reverse stock-split shares of common stock outstanding as of December 31, 2014, which are derived from the outstanding
convertible promissory notes. The registrant also has 10,000,000 shares of Series A Preferred Stock issued and outstanding, each
share of which can be converted into 100 shares of our common stock, therefor there are an additional 1,000,000,000 potentially
dilutive post revere stock-split shares of common stock.
H. Use of estimates
The preparation of financial statements in conformity
with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions
that affect certain reported amounts and disclosures. Significant estimates for the periods reported include certain assumptions
used in deriving the fair value of share-based compensation recognized, the useful life of tangible assets and the future value
of our website development costs. Assumptions and estimates used in these areas are material to our reported financial condition
and results of our operations. Actual results will differ from those estimates.
I. Business Segments
The Company operates in
one segment and therefore segment information is not presented.
J. Fair value of financial instruments measured on a recurring
basis
The registrant follows paragraph 825-10-50-10
of the FASB Accounting Standards Codification for disclosures about fair value of its financial instruments and paragraph 820-10-35-37
of the FASB Accounting Standards Codification (“Paragraph 820-10-35-37”) to measure the fair value of its financial
instruments. Paragraph 820-10-35-37 establishes a framework for measuring fair value in accounting principles generally accepted
in the United States of America (U.S. GAAP), and expands disclosures about fair value measurements. To increase consistency and
comparability in fair value measurements and related disclosures, Paragraph 820-10-35-37 establishes a fair value hierarchy which
prioritizes the inputs to valuation techniques used to measure fair value into three broad levels. The fair value hierarchy gives
the highest priority to quoted prices (unadjusted) in active markets for identical assets or liabilities and the lowest priority
to unobservable inputs. The three levels of fair value hierarchy defined by Paragraph 820-10-35-37 are described below:
Level 1 |
|
Quoted market prices available in active markets for identical assets or liabilities as of the reporting date. |
|
|
|
Level 2 |
|
Pricing inputs other than quoted prices in active markets included in Level 1, which are either directly or indirectly observable as of the reporting date. |
|
|
|
Level 3 |
|
Pricing inputs that are generally observable inputs and not corroborated by market data. |
Financial assets are considered Level 3 when
their fair values are determined using pricing models, discounted cash flow methodologies or similar techniques and at least one
significant model assumption or input is unobservable.
The fair value hierarchy gives the highest priority
to quoted prices (unadjusted) in active markets for identical assets or liabilities and the lowest priority to unobservable inputs.
If the inputs used to measure the financial assets and liabilities fall within more than one level described above, the categorization
is based on the lowest level input that is significant to the fair value measurement of the instrument.
The carrying amount of the registrant’s
financial assets and liabilities, such as cash, prepaid expenses and accrued expenses approximate their fair value because of the
short maturity of those instruments. The registrant’s line of credit and notes payable approximate the fair value of such
instruments based upon management’s best estimate of interest rates that would be available to the registrant for similar
financial arrangements at December 31, 2014, and December 31, 2013.
Transactions involving related parties cannot
be presumed to be carried out on an arm’s-length basis, as the requisite conditions of competitive, free-market dealings
may not exist. Representations about transactions with related parties, if made, shall not imply that the related party transactions
were consummated on terms equivalent to those that prevail in arm’s-length transactions unless such representations can be
substantiated.
It is not, however, practical to determine the
fair value of advances from stockholders due to their related party nature.
K. Commitments and contingencies
The registrant follows subtopic 450-20 of the
FASB Accounting Standards Codification to report accounting for contingencies. Certain conditions may exist as of the date the
consolidated financial statements are issued, which may result in a loss to the registrant but which will only be resolved when
one or more future events occur or fail to occur. The registrant assesses such contingent liabilities, and such assessment inherently
involves an exercise of judgment. In assessing loss contingencies related to legal proceedings that are pending against the registrant
or un-asserted claims that may result in such proceedings, the registrant evaluates the perceived merits of any legal proceedings
or un-asserted claims as well as the perceived merits of the amount of relief sought or expected to be sought therein.
If the assessment of a contingency indicates
that it is probable that a material loss has been incurred and the amount of the liability can be estimated, then the estimated
liability would be accrued in the registrant’s consolidated financial statements. If the assessment indicates that a potential
material loss contingency is not probable but is reasonably possible, or is probable but cannot be estimated, then the nature of
the contingent liability, and an estimate of the range of possible losses, if determinable and material, would be disclosed.
Loss contingencies considered remote are generally
not disclosed unless they involve guarantees, in which case the guarantees would be disclosed. Management does not believe, based
upon information available at this time, that these matters will have a material adverse effect on the registrant’s consolidated
financial position, results of operations or cash flows. However, there is no assurance that such matters will not materially and
adversely affect the registrant’s business, financial position, and results of operations or cash flows.
L. Related parties
The registrant follows subtopic 850-10 of the
FASB Accounting Standards Codification for the identification of related parties and disclosure of related party transactions.
Pursuant to Section 850-10-20 the Related
parties include (a) affiliates of the registrant; (b) Entities for which investments in their equity securities would be
required, absent the election of the fair value option under the Fair Value Option Subsection of Section
825–10–15, to be accounted for by the equity method by the investing entity; (c) trusts for the benefit of
employees, such as pension and profit-sharing trusts that are managed by or under the trusteeship of management; (d)
principal owners of the registrant; (e) management of the registrant; (f) other parties with which the registrant may deal 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; and (g) Other parties that can
significantly influence the management or operating policies of the transacting parties or that have an ownership interest in
one of the transacting parties and can significantly influence the other to an extent that one or more of the transacting
parties might be prevented from fully pursuing its own separate interests.
The financial statements shall include disclosures
of material related party transactions, other than compensation arrangements, expense allowances, and other similar items in the
ordinary course of business. However, disclosure of transactions that are eliminated in the preparation of consolidated or combined
financial statements is not required in those statements. The disclosures shall include: (a) the nature of the relationship(s)
involved; (b) description of the transactions, including transactions to which no amounts or nominal amounts were ascribed, for
each of the periods for which income statements are presented, and such other information deemed necessary to an understanding
of the effects of the transactions on the financial statements; (c) the dollar amounts of transactions for each of the periods
for which income statements are presented and the effects of any change in the method of establishing the terms from that used
in the preceding period; and (d) amounts due from or to related parties as of the date of each balance sheet presented and, if
not otherwise apparent, the terms and manner of settlement.
M. Embedded Conversion Features
The Company evaluates embedded
conversion features within convertible debt under ASC 815 “Derivatives and Hedging” to determine whether the embedded
conversion feature(s) should be bifurcated from the host instrument and accounted for as a derivative at fair value with changes
in fair value recorded in earnings. If the conversion feature does not require derivative treatment under ASC 815, the instrument
is evaluated under ASC 470-20 “Debt with Conversion and Other Options” for consideration of any beneficial conversion
features.
N. Derivative Financial Instruments
Fair value accounting requires
bifurcation of embedded derivative instruments such as conversion features in convertible debt or equity instruments, and measurement
of their fair value for accounting purposes. In determining the appropriate fair value, the Company uses the Black-Scholes option-pricing
model. In assessing the convertible debt instruments, management determines if the convertible debt host instrument is conventional
convertible debt and further if there is a beneficial conversion feature requiring measurement. If the instrument is not considered
conventional convertible debt, the Company will continue its evaluation process of these instruments as derivative financial instruments.
Once determined, derivative liabilities are
adjusted to reflect fair value at each reporting period end, with any increase or decrease in the fair value being recorded in
results of operations as an adjustment to fair value of derivatives. In addition, the fair value of freestanding derivative instruments
such as warrants, are also valued using the Black-Scholes option-pricing model.
O. Beneficial Conversion Feature
For conventional convertible
debt where the rate of conversion is below market value, the Company records a "beneficial conversion feature" ("BCF")
and related debt discount.
When the Company records
a BCF, the relative fair value of the BCF is recorded as a debt discount against the face amount of the respective debt instrument
(offset to additional paid in capital) and amortized to interest expense over the life of the debt.
P. Debt Issue Costs and Debt Discount
The Company may record
debt issue costs and/or debt discounts in connection with raising funds through the issuance of debt. These costs may be paid in
the form of cash, or equity (such as warrants). These costs are amortized to interest expense over the life of the debt. If a conversion
of the underlying debt occurs, a proportionate share of the unamortized amounts is immediately expensed.
Q. Cash flows reporting
The registrant adopted paragraph 230-10-45-24
of the FASB Accounting Standards Codification for cash flows reporting, classifies cash receipts and payments according
to whether they stem from operating, investing, or financing activities and provides definitions of each category, and uses the
indirect or reconciliation method (“Indirect method”) as defined by paragraph 230-10-45-25 of the FASB Accounting Standards
Codification to report net cash flow from operating activities by adjusting net income to reconcile it to net cash flow from operating
activities by removing the effects of (a) all deferrals of past operating cash receipts and payments and all accruals of expected
future operating cash receipts and payments and (b) all items that are included in net income that do not affect operating cash
receipts and payments. The registrant reports the reporting currency equivalent of foreign currency cash flows, using the current
exchange rate at the time of the cash flows and the effect of exchange rate changes on cash held in foreign currencies is reported
as a separate item in the reconciliation of beginning and ending balances of cash and cash equivalents and separately provides
information about investing and financing activities not resulting in cash receipts or payments in the period pursuant to paragraph
830-230-45-1 of the FASB Accounting Standards Codification.
R. Subsequent events
The registrant follows the guidance in Section
855-10-50 of the FASB Accounting Standards Codification for the disclosure of subsequent events. The registrant will evaluate
subsequent events through the date when the financial statements were issued. Pursuant to ASU 2010-09 of the FASB Accounting
Standards Codification, the registrant as an SEC filer considers its financial statements issued when they are widely distributed
to users, such as through filing them on EDGAR.
S. Recently Issued Accounting Standards
In June 2014, FASB issued
Accounting Standards Update (“ASU”) No. 2014-10, “Development Stage Entities (Topic 915): Elimination of Certain
Financial Reporting Requirements, Including an Amendment to Variable Interest Entities Guidance in Topic 810, Consolidation”.
The update removes all incremental financial reporting requirements from GAAP for development stage entities, including the removal
of Topic 915 from the FASB Accounting Standards Codification. In addition, the update adds an example disclosure in Risks and Uncertainties
(Topic 275) to illustrate one way that an entity that has not begun planned principal operations could provide information about
the risks and uncertainties related to the company’s current activities. Furthermore, the update removes an exception provided
to development stage entities in Consolidations (Topic 810) for determining whether an entity is a variable interest entity-which
may change the consolidation analysis, consolidation decision, and disclosure requirements for a company that has an interest in
a company in the development stage. The update is effective for the annual reporting periods beginning after December 15, 2014,
including interim periods therein. Early application with the first annual reporting period or interim period for which the entity’s
financial statements have not yet been issued (Public business entities) or made available for issuance (other entities). The Company
adopted this pronouncement for the three months ended August 31, 2014.
In June 2014, FASB issued
Accounting Standards Update (“ASU”) No. 2014-12, “Compensation – Stock Compensation ( Topic 718 ); Accounting
for Share-Based Payments When the Terms of an Award Provide That a Performance Target Could Be Achieved after the Requisite Service
Period”. The amendments in this ASU apply to all reporting entities that grant their employees share-based payments in which
the terms of the award provide that a performance target that affects vesting could be achieved after the requisite service period.
The amendments require that a performance target that affects vesting and that could be achieved after the requisite service period
be treated as a performance condition. A reporting entity should apply existing guidance in Topic 718 as it relates to awards with
performance conditions that affect vesting to account for such awards. For all entities, the amendments in this ASU are effective
for annual periods and interim periods within those annual periods beginning after December 15, 2015. Earlier adoption is permitted.
Entities may apply the amendments in this ASU either (a) prospectively to all awards granted or modified after the effective date
or (b) retrospectively to all awards with performance targets that are outstanding as of the beginning of the earliest annual period
presented in the financial statements and to all new or modified awards thereafter. If retrospective transition is adopted, the
cumulative effect of applying this Update as of the beginning of the earliest annual period presented in the financial statements
should be recognized as an adjustment to the opening retained earnings balance at that date. Additionally, if retrospective transition
is adopted, an entity may use hindsight in measuring and recognizing the compensation cost. This updated guidance is not expected
to have a material impact on our results of operations, cash flows or financial condition. We are currently reviewing the
provisions of this ASU to determine if there will be any impact on our results of operations, cash flows or financial condition.
In August 2014, the FASB
issued Accounting Standards Update “ASU” 2014-15 on “Presentation of Financial Statements Going Concern (Subtopic
205-40) – Disclosure of Uncertainties about an Entity’s Ability to Continue as a Going Concern”. Currently, there
is no guidance in U.S. GAAP about management’s responsibility to evaluate whether there is substantial doubt about an entity’s
ability to continue as a going concern or to provide related footnote disclosures. The amendments in this Update provide that guidance.
In doing so, the amendments are intended to reduce diversity in the timing and content of footnote disclosures. The amendments
require management to assess an entity’s ability to continue as a going concern by incorporating and expanding upon certain
principles that are currently in U.S. auditing standards. Specifically, the amendments (1) provide a definition of the term substantial
doubt, (2) require an evaluation every reporting period including interim periods, (3) provide principles for considering the mitigating
effect of management’s plans, (4) require certain disclosures when substantial doubt is alleviated as a result of consideration
of management’s plans, (5) require an express statement and other disclosures when substantial doubt is not alleviated, and
(6) require an assessment for a period of one year after the date that the financial statements are issued (or available to be
issued). We are currently reviewing the provisions of this ASU to determine if there will be any impact on our results of operations,
cash flows or financial condition.
All other newly issued
accounting pronouncements but not yet effective have been deemed either immaterial or not applicable.
NOTE 4 –GOING CONCERN
The accompanying financial statements have been
prepared assuming that the registrant will continue as a going concern, which contemplates continuity of operations, realization
of assets, and liquidation of liabilities in the normal course of business.
As of December 31, 2014, the registrant had
an accumulated deficit during development stage of $20,892,024. Also, during the year ended December 31, 2014, the registrant used
net cash of $781,293 for operating activities. These factors raise substantial doubt about the registrant’s ability to continue
as a going concern.
While the registrant is attempting to commence
operations and generate revenues, the registrant’s cash position may not be significant enough to support the registrant’s
daily operations. Management intends to raise additional funds by way of a public or private offering. Management believes that
the actions presently being taken to further implement its business plan and generate revenues provide the opportunity for the
registrant to continue as a going concern. While the registrant believes in the viability of its strategy to generate revenues
and in its ability to raise additional funds, there can be no assurances to that effect. The ability of the registrant to continue
as a going concern is dependent upon the registrant’s ability to further implement its business plan and generate revenues.
The financial statements do not include any
adjustments that might be necessary if the registrant is unable to continue as a going concern.
NOTE 5– PREPAIDS
The prepaid asset recorded at December 31, 2014,
was the result of:
| a.) | The registrant executing a six month consulting agreement on September 2, 2014, whereby the registrant
issued 30,000,000 free trading S-8 shares to Noah Fouch to provide weekly marketing services through social media platforms. The
30,000,000 shares were valued at the closing price of $0.0016 on the date of the agreement which will result in the registrant
recording consulting expense of $48,000 over the life of the contract. |
| b.) | The registrant executing a one year service agreement on September 12, 2014, whereby the registrant
issued 5,000,000 shares of Series A Preferred Stock to its CEO, Kerry Driscoll. The 5,000,000 shares were valued at par $0.001
which will result in the registrant recording officer compensation expense of $5,000 over the life of the contract. |
| c.) | The registrant executing a (1) year service agreement on September 12, 2014, whereby the registrant
issued 5,000,000 shares of Series A Preferred Stock to a former officer of the registrant. The 5,000,000 shares were valued at
par $0.001 which will result in the registrant recording officer compensation expense of $5,000 over the life of the contract. |
As of December 31, 2014 and 2013, the registrant
had a prepaid balance of $46,020 and $289,550 which are derived from the uncompleted portion of the consulting agreements with
the registrant.
NOTE 6– PROPERTY PLANT &
EQUIPMENT
Furniture and Equipment
consisted of the
following:
| |
December 31, 2014 | |
December 31, 2013 |
| |
| | | |
| | |
Equipment | |
$ | 85,467 | | |
$ | 82,531 | |
Furniture | |
| 4,186 | | |
| 4,186 | |
Total | |
| 89,653 | | |
| 86,717 | |
Less accumulated Depreciation | |
| (86,876 | ) | |
| (84,299 | ) |
Property and equipment, net | |
$ | 2,777 | | |
$ | 2,418 | |
On April 30, 2013, the registrant acquired
all the assets of Mind Technologies, Inc. through an executed Asset Purchase Agreement (Described in Note 9).
Depreciation
expense for the
year ended December 31, 2014, and 2013 was $2,577 and $2,442.
NOTE 7 – RELATED
PARTY TRANSACTIONS
Convertible note payable to related party
On January 2, 2014, the registrant entered into
a convertible promissory note with Brent Fouch, in the amount of $61,096, bearing no interest, convertible at the closing market
price on the date of conversion. On January 5, 2014, Brent Fouch entered into an assignment agreement with Magna Group, LLC, whereby
Brent Fouch assigned his convertible promissory note dated January 2, 2014, in the amount of $61,096.
Consulting agreement(s) with CEO
The registrant executed a consulting agreement
on December 25, 2013, with its current Chief Executive Officer whereby the registrant issued 120,000,000 post reverse-split shares
of common stock for one year of executive services. The 120,000,000 shares were valued at the closing price of $0.0022 on the date
of the agreement which will result in the registrant recording officer compensation of $264,000 over the life of the contract.
The registrant executed a service agreement
on September 12, 2014, with its current Chief Executive Officer, Kerry Driscoll, whereby the registrant issued 5,000,000 shares
of Series A Preferred Stock for one year of services such as compliance, guidance, infrastructure and business strategy. The 5,000,000
shares were valued at par $0.001which resulted in the registrant recording officer compensation of $5,000 over the life of the
contract.
Service Agreement with Former Officer
The registrant executed a service agreement
on September 12, 2014, with Brent Fouch, a former officer of the Company, whereby the registrant issued 5,000,000 shares of Series
A Preferred Stock for one year services to facilitate the development of BCI software compatibility with the registrant’s
micro BCI headset. The 5,000,000 preferred shares were valued at par $0.001which resulted in the registrant recording a consulting
expense of $5,000 over the life of the contract.
Asset Purchase Agreement
On April
30, 2013, the registrant executed an asset purchase agreement with Mind Technologies, Inc., (MTEK), whereby the registrant purchased
all the assets of MTEK for 15,000 post reverse-split common shares. The assets purchased include those previously licensed from
MTEK, described in Note 9.
Free office space provided by chief executive officer
The registrant has been provided office space
by its chief executive officer Kerry Driscoll at no cost. Management has determined that such cost is nominal and did not recognize
the rent expense in its financial statements.
NOTE 8– AVAILABLE-FOR-SALE
SECURITIES
Other Comprehensive Income/Loss
On February 12, 2014, the registrant entered
into a consulting agreement with Monster Arts, Inc. (“Monster”), whereby the registrant will provide Monster with thought
controlled software development services over a one year term. The registrant will be paid four quarterly payments of $50,000 in
restricted common stock of Monster. As of December 31, 2014, the registrant has received two certificates of Monster’s stock
totally 39,583,333 common shares worth approximately $100,000, based on the closing stock price at the date of receipt, which was
recorded as an available-for-sale security asset with the credit to deferred revenues. The registrant revalued the 39,583,333 shares
on December 31, 2014, which resulted in an unrealized loss on available-for-sale securities of $96,042 as the stock price of Monster
decreased to $0.0001.
As of December 31, 2014, and December 31, 2013,
the registrant had available for sale securities balance of $3,958 and $0.
NOTE 9 – LICENSED
PRODUCTS & ASSET PURCHASE
On December
18, 2012, the registrant signed a licensing agreement with Mind Technologies, Inc., (MTEK), for the right to use, develop, improve,
manufacture, and sale the licensed software application which uses wireless headsets
to read brainwaves
and allow interaction
with a computer.
The registrant issued 3,500 post reverse-split common shares to MTEK as consideration
for the licensing agreement. The shares were valued at the amortized holding cost of the related party. The amortized holding cost
was $-0- at December 30, 2014, and December 31, 2013, respectively.
On April
30, 2013, the registrant executed an asset purchase agreement with MTEK, whereby the registrant purchased all the assets of MTEK
for 15,000 post reverse-split common shares. The assets purchased were previously licensed from MTEK as described previously. The
cost basis of the assets acquired is $86,033, with accumulated depreciation of $81,638, which resulted in a net asset balance of
$4,395. The registrant recorded the excess consideration as additional paid in capital inasmuch as it was a related party transaction.
The former CEO of Mind Solutions, Inc. is also the former CEO of Mind Technologies, Inc. The registrant acquired all the assets
involved with the former operations of MTEK which include three thought-controlled software applications named Mind Mouse,
Master Mind and Think-Tac-Toe. These purchased assets constitute neural processing software for thought-controlled technologies,
allowing the user to interact with computers, gaming devices, and other machines through the power of the mind. Included in the
purchase are all Mind Technologies’ inventory, fixed assets, intellectual property, and an assignment of rights and assumption
of obligations under Mind Technologies’ existing contracts.
NOTE 10 –
CONVERTIBLE NOTES PAYABLE
In the year ended December 31, 2014, the registrant
entered into nineteen convertible note agreements. As of December 31, 2014 and 2013, the registrant
has $451,728 and $248,358 in outstanding convertible notes payable with eight non-related entities.
On January 2, 2014, the registrant entered into
a convertible promissory note with Brent Fouch, a related party to the registrant, in the amount of $61,096, bearing no interest,
convertible at the closing market price on the date of conversion. On January 5, 2014, Brent Fouch entered into an assignment agreement
with Magna Group, LLC, whereby Brent Fouch assigned his convertible promissory note dated January 2, 2014, in the amount of $61,096.
On February 4, 2014, the registrant entered
into a Convertible Note Agreement with GEL Properties LLC. The registrant issued a $25,000 convertible note with interest of 10%
per annum, unsecured, and due February 4, 2015. The note is convertible into common shares of the registrant at any time from the
date of issuance at a conversion rate of 55% of the market price, calculated as the lowest trading price in the previous 10 days
leading up to the date of conversion. As of December 31, 2014, GEL Properties LLC converted the entire principle balance of $25,000
into 48,017,966 shares of common stock.
On February 4, 2014, the registrant entered
into a Convertible Note Agreement with LG Capital Funding LLC whereby there is a front end and a back end note with the same terms.
On February 4, 2014, the registrant issued a $25,000 front end convertible note with interest of 10% per annum, unsecured, and
due February 4, 2015. The note is convertible into common shares of the registrant at any time from the date of issuance at a conversion
rate of 55% of the market price, calculated as the lowest trading price in the previous 10 days leading up to the date of conversion.
On August 7, 2014, the registrant issued a back end note of $25,000 with the same terms. As of December 31, 2014, LG Capital Funding
LLC converted the entire principle balance of the front end note, $25,000, and $1,312 of accrued interest into 47,864,258 shares
of our common stock. As of December 31, 2014, the registrant has converted the entire principle of the back end note, $25,000,
into 57,206,039 shares of our common stock.
On February 6, 2014, the registrant entered
into a Securities Purchase Agreement with Asher Enterprises Inc. for a $37,500 convertible note payable due interest at 8% per
annum, unsecured, and due November 10, 2014. The note is convertible into common shares of the registrant at any time from the
date of issuance at a conversion rate of 58% of the market price, calculated as the average of the three lowest trading prices
in the previous 30 days leading up to the date of conversion. As of December 31, 2014, Asher converted the entire principle balance
of $37,500 and $4,500 of accrued interest into 99,765,528 shares of common stock.
On February 25, 2014, the registrant entered
into a Convertible Note Agreement with Iconic Holdings, LLC. The registrant issued a $27,500 convertible note, with $2,750 of original
issue discount, with interest of 10% per annum, unsecured, and due February 25, 2015. The note is convertible into common shares
of the registrant at any time from the date of issuance at a conversion rate of 55% of the market price, calculated as the lowest
trading price in the previous 10 days leading up to the date of conversion. As of December 31, 2014, Iconic Holdings, LLC converted
the entire principle balance of $27,500 into 68,750,000 shares of common stock.
On March 11, 2014, the registrant entered into
a Convertible Note Agreement with Premier Venture Partners, LLC. The registrant issued a $10,000 convertible note with interest
of 8% per annum, unsecured, and due March 11, 2015. The note is convertible into common shares of the registrant at any time from
the date of issuance at a conversion rate of 50% of the market price, calculated as the lowest trading price in the previous 10
days leading up to the date of conversion. As of December 31, 2014, Premier Venture Partners, LLC converted the entire principle
balance of $10,000 and $605 of accrued interest into 15,149,902 shares of common stock of which 15,149,902 have yet to be issued
as of December 31, 2014 and have been recorded as stock payable.
On March 25, 2014, the registrant entered into
a Convertible Note Agreement with LG Capital Funding LLC. The registrant issued a $40,000 convertible note with interest of 10%
per annum, unsecured, and due March 25, 2015. The note is convertible into common shares of the registrant at any time from the
date of issuance at a conversion rate of 55% of the market price, calculated as the lowest trading price in the previous 10 days
leading up to the date of conversion. As of December 31, 2014, LG Capital Funding LLC converted the entire principle balance of
$40,000 and $171 of accrued interest into 77,224,305 shares of common stock.
On April 15, 2014, the registrant entered into
a Convertible Note Agreement with Caesar Capital Group, LLC. The registrant issued a $50,000 convertible note with interest of
8% per annum, unsecured, and due April 15, 2015. The note is convertible into common shares of the registrant at any time from
the date of issuance at a conversion rate of 55% of the market price, calculated as the lowest trading price in the previous 10
days leading up to the date of conversion. As of December 31, 2014, Caesar Capital Group, LLC has converted the entire principle
of $50,000 and $2,034 of accrued interest into 37,166,878 shares of common stock in the Company.
On April 30, 2014, the registrant entered into
a Convertible Note Agreement with ARRG, Corp. The registrant issued a $50,000 convertible note with interest of 8% per annum, unsecured,
and due April 30, 2015. The note is convertible into common shares of the registrant at any time from the date of issuance at a
conversion rate of 55% of the market price, calculated as the lowest trading price in the previous 10 days leading up to the date
of conversion. As of December 31, 2014, ARRG Corp has converted the entire principle of $50,000 and $2,000 of accrued interest
into 37,142,857 shares of common stock in the Company.
On May 8, 2014, the registrant entered into
a Securities Purchase Agreement with KBM Worldwide, Inc. for a $42,500 convertible note payable due interest at 8% per annum, unsecured,
and due February 12, 2014. The note is convertible into common shares of the registrant at any time from the date of issuance at
a conversion rate of 51% of the market price, calculated as the average of the three lowest trading prices in the previous 30 days
leading up to the date of conversion. As of December 31, 2014, KBM Worldwide, Inc. has converted the entire principle balance of
$42,500 into 45,948,276 shares of common stock in the Company.
On May 12, 2014, we executed a Consulting Agreement
with Cicero Consulting Group, LLC and convertible promissory note in the amount of $200,000 due May 12, 2015. Cicero Consulting
Group, LLC will provide management consulting and business advisory services to Mind Solutions over a one year term. We have compensated
Cicero Consulting Group, LLC with a $200,000 convertible promissory note which is considered earned in full as of May 12, 2014.
The convertible note issued pursuant to the Consulting Agreement may be converted into shares of our common stock after six months
from the date of the executed note at a 10 percent discount to market based on the lowest trading price during the 10 trading days
prior to the conversion date. As of December 31, 2014, Cicero Consulting Group, LLC has converted $100,000 principle into 71,078,431
shares of our common stock.
On May 30, 2014, the registrant entered into
a Convertible Note Agreement with WHC Capital, LLC. The registrant issued a $60,000 convertible note with interest of 12% per annum,
unsecured, and due May 30, 2015. The note is convertible into common shares of the registrant at any time from the date of issuance
at a conversion rate of 50% discount to the market price, calculated as the lowest trading price in the previous 10 trading days
leading up to the date of conversion. As of December 31, 2014, WHC Capital, LLC has converted $50,000 of principle into 72,000,000
shares of common stock in the Company.
On May 15, 2013, the registrant executed a convertible
promissory note with JMJ Financial, (“JMJ”) in an amount up to $250,000 bearing interest on the unpaid balance at the
rate of 12 percent. While the note was in the original principal amount up to $250,000, it was only partially funded. On May 15,
2013, the registrant received $30,000 pursuant to this convertible promissory note with JMJ Financial. On August 14, 2013, the
registrant received $20,000 pursuant to this convertible promissory note with JMJ Financial. On December 4, 2013, the registrant
received $25,000 pursuant to this convertible promissory note with JMJ Financial. On April 16, 2014, the registrant received $40,000
pursuant to this convertible promissory note with JMJ Financial. On June 23, 2014, the registrant received $60,000 pursuant to
this convertible promissory note with JMJ Financial. On December 16, 2014, the registrant received $25,000 pursuant to this convertible
promissory note with JMJ Financial. The notes are interest free for the first 180 days after which it accrues interest of 12% per
annum. The note is convertible after 180 days into common shares of the registrant at a conversion rate of 60% of the market price,
calculated as the lowest trade price in the 25 trading days previous to conversion. As of December 31, 2014, the Company recorded
$48,889 in original debt discount pertaining to the accumulation from all the notes issued to JMJ. As of December 31, 2014, JMJ
Financial converted $162,911 in principle into 206,971,111 shares of common stock leaving a note payable balance of $85,978 due
to JMJ.
On July 22, 2014, the registrant entered into
a Securities Purchase Agreement (SPA) with KBM Worldwide, Inc. The registrant issued a $27,500 convertible note in connection with
the SPA which has interest of 8% per annum, unsecured, and due July 22, 2015. The note is convertible into common shares of the
registrant at any time from the date of issuance at a conversion rate of 51% of the market price, calculated as the average of
the three lowest trading prices in the previous 10 days leading up to the date of conversion. As of December 31, 2014, KBM Worldwide,
Inc. has not converted any principle on this note.
On August 28, 2014, the registrant entered into
a Convertible Note Agreement with GEL Properties LLC. The registrant issued a $25,000 convertible note with interest of 10% per
annum, unsecured, and due August 28, 2015. The note is convertible into common shares of the registrant at any time from the date
of issuance at a conversion rate of 55% of the market price, calculated as the lowest trading price in the previous 10 trading
days leading up to the date of conversion. As of December 31, 2014, GEL Properties LLC converted the entire principle balance of
$25,000 into 56,818,182 shares of common stock.
On September 4, 2014, the registrant entered
into a Convertible Note Agreement with LG Capital Funding LLC. The registrant issued a $31,500 convertible note with interest of
10% per annum, unsecured, and due September 4, 2015. The note is convertible into common shares of the registrant at any time from
the date of issuance at a conversion rate of 55% of the market price, calculated as the lowest trading price in the previous 10
days leading up to the date of conversion. As of December 31, 2014, LG Capital Funding LLC has not converted any principle on this
note.
On September 22, 2014, the registrant
entered into a Convertible Note Agreement with JSJ Investments Inc. The registrant issued a $100,000 convertible note with
interest of 12% per annum, unsecured, and due March 22, 2015. The note is convertible into common shares of the registrant at
any time from the date of issuance at a conversion rate of 48% discount to the market price, calculated as the average of the
three lowest trading prices in the previous 20 trading days leading up to the date of conversion. As of December 31, 2014,
JSJ Investments Inc. has not converted any principle on this note.
On September 25, 2014, the registrant entered
into a Convertible Note Agreement with Iconic Holdings, LLC. The registrant issued a $27,500 convertible note, with $2,750 of original
issue discount, with interest of 10% per annum, unsecured, and due September 25, 2015. The note is convertible into common shares
of the registrant at any time from the date of issuance at a conversion rate of 55% of the market price, calculated as the lowest
trading price in the previous 10 days leading up to the date of conversion. As of December 31, 2014, Iconic Holdings, LLC has not
converted any principle on this note.
On October 30, 2014, the registrant entered
into a Convertible Note Agreement with Iconic Holdings, LLC. The registrant issued a $27,500 convertible note, with $2,750 of original
issue discount, with interest of 10% per annum, unsecured, and due October 30, 2015. The note is convertible into common shares
of the registrant at any time from the date of issuance at a conversion rate of 55% of the market price, calculated as the lowest
trading price in the previous 10 days leading up to the date of conversion. As of December 31, 2014, Iconic Holdings, LLC has not
converted any principle on this note.
On October 29, 2014, the registrant entered
into a Securities Purchase Agreement (SPA) with KBM Worldwide, Inc. The registrant issued a $32,500 convertible note in connection
with the SPA which has interest of 8% per annum, unsecured, and due July 31, 2015. The note is convertible into common shares of
the registrant at any time from the date of issuance at a conversion rate of 55% of the market price, calculated as the average
of the three lowest trading prices in the previous 10 days leading up to the date of conversion. As of December 31, 2014, KBM Worldwide,
Inc. has not converted any principle on this note.
Conversion of convertible debt.
In the year ended December 31, 2014, Asher Enterprises
converted 85,200 of convertible debt and $4,500 of accrued interest into 104,613,454 post reverse-split shares of common stock,
Magna Group, LLC converted $37,000 of convertible debt into 4,510,292 post reverse-split shares of common stock, Hanover Holdings
converted $94,500 of convertible debt into 106,789,630 post reverse-split shares of common stock, JMJ Financial converted $157,079
into 208,833,784 post reverse-split shares of commons stock, GEL Properties, LLC converted $50,000 of convertible debt into 104,836,148
post reverse-split shares of common stock, LG Capital Funding LLC converted $89,000 of convertible debt into 145,117,267 post reverse-split
shares of common stock, Iconic Holdings, LLC converted $27,500 of convertible debt into 68,750,000 post reverse-split shares of
common stock and IBC Funds LLC converted $61,085 of convertible debt, $2,030 of accrued interest into 73,876,000 post reverse-split
shares of common stock, AARG Corp. converted $50,000 of convertible debt into 37,142,857 post reverse-split shares of common stock,
Caesar Capital Group, LLC converted $50,000 of convertible debt into 37,166,878 post reverse-split shares of common stock, KBM
Worldwide Inc. converted $42,500 of convertible debt into 45,948,276 post reverse-split shares of common stock, Cicero Consulting
Group converted $100,000 of convertible debt into 71,078,431 post reverse-split shares of common stock. Premier Venture Partners,
LLC converted $10,000 of convertible debt and $605 of accrued interest into 15,149,902 post reverse-split shares of common stock
of which 15,149,902 shares have yet to be issued and have been recorded as a stock payable and WHC Capital, LLC converted $50,000
of convertible debt into 72,000,000 shares of common stock of which 40,000,000 shares have yet to be issued and have been recorded
as a stock payable.
The following table summarizes the total outstanding
principle on convertible notes payable:
| |
December 31, 2014 | |
December 31, 2013 |
| |
| | | |
| | |
Convertible Notes Payable- Asher Enterprises, Inc. | |
$ | — | | |
$ | 47,700 | |
Convertible Notes Payable- Magna Group, LLC | |
| — | | |
| 37,000 | |
Convertible Notes payable - Hanover Holdings, LLC | |
| — | | |
| 33,404 | |
Convertible Notes Payable - JMJ Financial, LLC | |
| 85,978 | | |
| 69,168 | |
Convertible Notes Payable - IBC Funds LLC | |
| — | | |
| 61,086 | |
Convertible Notes Payable - LG Capital Funding LLC | |
| 32,500 | | |
| — | |
Convertible Notes Payable - Iconic Holdings | |
| 63,250 | | |
| — | |
Convertible Notes Payable - KBM Worldwide, Inc. | |
| 60,000 | | |
| — | |
Convertible Notes Payable - WHC Capital, LLC | |
| 10,000 | | |
| — | |
Convertible Notes Payable - Cicero Consulting Group, LLC | |
| 100,000 | | |
| — | |
Convertible Notes Payable - JSJ Investments Inc. | |
| 100,000 | | |
| — | |
Total | |
$ | 451,728 | | |
$ | 248,358 | |
In the year ended December 31, 2014, and 2013,
the registrant recorded interest expense relating to the outstanding convertible notes payable in the amounts of $16,295 and $6,478.
Derivative liability.
At December 31, 2014 and 2013, the Company had
$1,767,223 and $19,907,242 in derivative liability. In the year ended December 31, 2014, the Company reduced its derivative liability
by $18,140,019 of which 4,077,634 was credited as an Other Income Item- Gain on Derivative Adjustment due to the change in derivative
liability calculated by the Black Scholes Model pertaining to the outstanding convertible notes payable.
We calculate the derivative liability using
the Black Scholes Model which factors in the Company’s stock price volatility as well as the convertible terms applicable
to the outstanding convertible notes. The following is the range of variables used in revaluing the derivative liabilities at December
31, 2014 and December 31, 2013:
| |
| December
31, 2014 | | |
| December
31, 2013 | |
Annual dividend yield | |
| 0 | | |
| 0 | |
Expected life (years) of | |
| 0.01 – .90 | | |
| 0.01 – .90 | |
Risk-free interest rate | |
| 10 | % | |
| 10 | % |
Expected volatility | |
| 508.1 | % | |
| 372.2 | % |
NOTE 11– NOTES
PAYABLE
The total amount due on notes payable and related
interest and penalty is as follows:
| |
December 31, 2014 | |
December 31, 2013 |
| |
| |
|
Notes Payable | |
$ | 145,000 | | |
$ | 145,000 | |
| |
| | | |
| | |
Total | |
$ | 145,000 | | |
$ | 145,000 | |
The registrant has outstanding notes due to
a former director in the aggregate amount of $145,000. The notes are unsecured and accrue interest and penalty of 15% inasmuch
as they are past due. The former director elected not to participate with the holders of other promissory notes, including our
then executive officers, in the exchange of those notes for equity which occurred during January 2009. At December 31, 2014, and
December 31, 2013, total accrued interest and penalty pertaining to the outstanding $145,000 in notes payable is $280,024 and $251,019.
NOTE 12– REVERSE
STOCK SPLIT
On October 15, 2013, the registrant executed
a Plan of Merger with Mind Solutions, Inc. whereby the holders of stock in VOIS, Inc. received one share of common stock, $0.001
par value per share, in Mind Solutions, Inc. for every 2,000 shares of common stock in VOIS, Inc. (in effect, a one for 2,000 reverse
split). As a result, the then current common stockholders of VOIS, Inc. held all of the issued and outstanding shares of common
stock in the surviving corporation Mind Solutions, Inc. The registrant has adjusted the equity statement and equity portion of
the balance sheet to retroactively account for the reverse stock split as if it occurred at inception.
NOTE 13– STOCKHOLDERS’
EQUITY
Authorized Common Stock
On May 17, 2013, the registrant’s
board voted to authorize an amendment to the registrant’s articles of incorporation to increase its authorized shares
of common stock from 1,000,000,000 to 3,000,000,000. On August 23, 2013, the registrant’s board authorized an amendment
to the registrant’s articles of incorporation to increase its authorized shares of common stock from 3,000,000,000 to
5,000,000,000.
Authorized Preferred Stock
The registrant is authorized to issue 10,000,000
shares of Series A Preferred Stock.
The board of directors passed a resolution designating
certain preferential liquidity, dividend, voting and other relative rights to Shares of Series A Preferred Stock. Each share of
Series A Preferred Stock may at the option of the holder be converted into 100 fully paid and non-assessable shares of common stock.
Issued Preferred Stock
On September 12, 2014, the registrant issued
5,000,000 Preferred A Shares to its chief executive officer, Kerry Driscoll, for one year of services to be rendered to the registrant.
The 5,000,000 shares were valued at par $0.001which resulted in the registrant recording officer compensation of $5,000 over the
life of the contract.
The registrant executed a service
agreement on September 12, 2014, with Brent Fouch, a former officer, whereby the registrant issued 5,000,000 shares of Series
A Preferred Stock for one year services to facilitate the development of BCI software compatibility with the
registrant’s micro BCI headset. The 5,000,000 preferred shares were valued at par $0.001 which resulted in the
registrant recording a consulting expense of $5,000 over the life of the contract.
Issued Common Stock
In the year ended December 31, 2013, the registrant
issued 35,894,503 post reverse-split shares of common stock. Of the 35,894,503 post reverse-split shares issued, 22,088,000 post
reverse-split shares were to consultants for services, 15,000 (post reverse-split) shares were issued in an asset purchase agreement,
10,625 (post reverse-split) shares were issued to a related party for the reduction of $51,000 in related party convertible debt,
and 13,777,673 post reverse-split shares were issued to non-related convertible note holders for the reduction of $469,346 in convertible
debt. Of the 22,088,000 shares to consultants, 20,000,000 were issued to our chief executive officer pursuant to a one year consulting
agreement dated December 25, 2013. We recorded the portion of the contract not yet completed as prepaid expense. The 22,088,000
shares issued for services rendered were valued at the closing price on the dates of their respective agreements which resulted
in the registrant recording a consideration of $1,467,703. Of the other 2,088,000 shares for services, 238,000 were to the Secretary
of the registrant for consulting services provided over the past two years. The other 1,850,000 were to unrelated third party consultants
for investor related services completed by December 31, 2013.
In the year ended December 31, 2014, the registrant
issued 1,352,758,793 post reverse-split shares of common stock, of which 252,895,776 shares were issued for services and 1,099,863,017
shares were issued for the reduction of $861,629 in convertible notes payable debt and $18,487 of accrued interest. The 252,897,776
shares issued for services rendered were valued at the closing price on the dates of their respective agreements which resulted
in the registrant recording a consulting expense of $562,361.
Stock Payable
As of December 31, 2014, the Company had a stock payable balance
of $36,605 pursuant to two conversion notices for the reduction of $36,605 in convertible debt for the issuance of 55,149,902 shares
of our common stock which were issued in January of 2015. As of December 31, 2013, the Company recorded a stock payable of $235,357
pursuant to the uncompleted portion of the consulting agreement with our chief executive officer which accounted for $220,000.
The remaining stock payable balance is made up of $15,375 which is due to IBC Funds, Inc. based on the settlement fee on the date
of the agreement.
NOTE 14– COMMITMENTS
We were a defendant in two actions, each
entitled 951 Yamato Acquisition registrant, LLC vs. VOIS, Inc., both as filed in December 2009 in the Circuit Court of
the 15th Judicial Circuit in and for Palm Beach County, Florida under case numbers 502010CA040121XXXXMB and
502010CC19027XXXXBBRS, which are related to the lease agreements for our former office space. A combined summary judgment was
entered in April, 2010 against VOIS, Inc. in the amount of $106,231. At December 31, 2014 and 2013, our liabilities as
reported in our financial statements contained elsewhere in this report reflect the principal amount of the judgment together
with $30,278 and $23,903 in accrued interest, respectively.
NOTE 15- SUBSEQUENT
EVENTS
Management has evaluated subsequent events pursuant
to the requirements of ASC Topic 855 and has determined that other than listed below, there were no other material subsequent events
exist.
| 1. | In January and February of 2015, convertible note holders converted $142,367 of principle and
$5,105 of accrued interest into 304,308,383 shares of common stock. The Company also issued 55,149,902 shares of common stock in
January 2015 to convertible note holders who executed conversion notices in December 2014. |
| 2. | In February of 2015, the Company issued a $50,000 convertible note with $5,000 of original issue
discount to Iconic Holdings, LLC for a total consideration of $55,000. The note bears interest of 10% per annum and is convertible
into shares of stock in the Company at a 45% discount from lowest trading day in the 10 days prior to conversion. The Company received
$50,000 in proceeds from the issuance of this note. |
| 3. | On February 10, 2015, the Company issued a $31,500 convertible note to LG Capital Funding, LLC.
The note bears interest of 10% per annum is convertible in into shares of stock in the Company at a 45% discount from lowest trading
day in the 10 days prior to conversion. The Company received $30,000 in proceeds from the issuance of this note with $1,500 going
toward legal fees. |
SECURITIES PURCHASE AGREEMENT
This SECURITIES
PURCHASE AGREEMENT (the “Agreement”), dated as of February 10, 2015, by and between Mind Solutions, Inc.,
a Nevada corporation, with headquarters located at 3525 Del Mar Heights Road, Suite #802, San Diego, CA 92130(the “Company”),
and LG Capital Funding, LLC., a New York Limited Liability Company, with its address at 1218 Union Street, Suite #2, Brooklyn,
NY 11225 (the “Buyer”).
WHEREAS:
A.
The Company and the Buyer are executing and delivering this Agreement in reliance upon the exemption from securities registration
afforded by the rules and regulations as promulgated by the United States Securities and Exchange Commission (the “SEC”)
under the Securities Act of 1933, as amended (the “1933 Act”);
B.
Buyer desires to purchase and the Company desires to issue and sell, upon the terms and conditions set forth in this Agreement
a10% convertible notes of the Company, in the forms attached hereto as Exhibit A in the aggregate principal amount of $31,500.00
(together with any note(s) issued in replacement thereof or as a dividend thereon or otherwise with respect thereto in accordance
with the terms thereof, the “Note”), convertible into shares of common stock, $0.001 par value per share, of the Company
(the “Common Stock”), upon the terms and subject to the limitations and conditions set forth in such Note.
C.
The Buyer wishes to purchase, upon the terms and conditions stated in this Agreement, such principal amount of Note as is
set forth immediately below its name on the signature pages hereto; and
NOW THEREFORE, the
Company and the Buyer severally (and not jointly) hereby agree as follows:
1.
Purchase and Sale of Note.
a.
Purchase of Note. On the Closing Date (as defined below), the Company shall issue and sell to the Buyer and the Buyer
agrees to purchase from the Company such principal amount of Note as is set forth immediately below the Buyer’s name on the
signature pages hereto.
b.
Form of Payment. On the Closing Date (as defined below), (i)the Buyer shall pay the purchase price for the Note to
be issued and sold to it at the Closing (as defined below) (the “Purchase Price”) by wire transfer of immediately available
funds to the Company, in accordance with the Company’s written wiring instructions, against delivery of the Note in the principal
amount equal to the Purchase Price as is set forth immediately below the Buyer’s name on the signature pages hereto, and
(ii) the Company shall deliver such duly executed Note on behalf of the Company, to the Buyer, against delivery of such Purchase
Price.
c.
Closing Date. The date and time of the issuance and sale of the Note pursuant to this Agreement (the “Closing
Date”) shall be on or aboutFebruary 10, 2015, or such other mutually agreed upon time. The closing of the transactions contemplated
by this Agreement (the “Closing”) shall occur on the Closing Date at such location as may be agreed to by the parties.
Subsequent Closings shall occur when the Buyer Note is repaid.
2.
Buyer’s Representations and Warranties.The Buyer represents and warrants to the Company that:
a.
Investment Purpose. As of the date hereof, the Buyer is purchasing the Note and the shares of Common Stock issuable
upon conversion of or otherwise pursuant to the Note, such shares of Common Stock being collectively referred to herein as the
“Conversion Shares” and, collectively with the Note,the “Securities”) for its own account and not with
a present view towards the public sale or distribution thereof, except pursuant to sales registered or exempted from registration
under the 1933 Act; provided, however, that by making the representations herein, the Buyer does not agree to hold
any of the Securities for any minimum or other specific term and reserves the right to dispose of the Securities at any time in
accordance with or pursuant to a registration statement or an exemption under the 1933 Act.
b.
Accredited Investor Status. The Buyer is an “accredited investor” as that term is defined in Rule 501(a)
of Regulation D (an “Accredited Investor”).
c.
Reliance on Exemptions. The Buyer understands that the Securities are being offered and sold to it in reliance upon
specific exemptions from the registration requirements of United States federal and state securities laws and that the Company
is relying upon the truth and accuracy of, and the Buyer’s compliance with, the representations, warranties, agreements,
acknowledgments and understandings of the Buyer set forth herein in order to determine the availability of such exemptions and
the eligibility of the Buyer to acquire the Securities.
d.
Information. The Buyer and its advisors, if any, have been, and for so long as the Note remain outstanding will continue
to be, furnished with all materials relating to the business, finances and operations of the Company and materials relating to
the offer and sale of the Securities which have been requested by the Buyer or its advisors. The Buyer and its advisors, if any,
have been, and for so long as the Note remain outstanding will continue to be, afforded the opportunity to ask questions of the
Company. Notwithstanding the foregoing, the Company has not disclosed to the Buyer any material nonpublic information and will
not disclose such information unless such information is disclosed to the public prior to or promptly following such disclosure
to the Buyer. Neither such inquiries nor any other due diligence investigation conducted by Buyer or any of its advisors or representatives
shall modify, amend or affect Buyer’s right to rely on the Company’s representations and warranties contained in Section
3 below. The Buyer understands that its investment in the Securities involves a significant degree of risk. The Buyeris not aware
of any facts that may constitute a breach of any of the Company's representations and warranties made herein.
e.
Governmental Review. The Buyer understands that no United States federal or state agency or any other government
or governmental agency has passed upon or made any recommendation or endorsement of the Securities.
f.
Transfer or Re-sale. The Buyer understands that (i) the sale or re-sale of the Securities has not been and is not
being registered under the 1933 Act or any applicable state securities laws, and the Securities may not be transferred unless (a) the
Securities are sold pursuant to an effective registration statement under the 1933 Act, (b) the Buyer shall have delivered
to the Company, at the cost of the Buyer, an opinion of counsel that shall be in form, substance and scope customary for opinions
of counsel in comparable transactions to the effect that the Securities to be sold or transferred may be sold or transferred pursuant
to an exemption from such registration, which opinion shall be accepted by the Company, (c) the Securities are sold or transferred
to an “affiliate” (as defined in Rule 144 promulgated under the 1933 Act (or a successor rule) (“Rule 144”))
of the Buyer who agrees to sell or otherwise transfer the Securities only in accordance with this Section 2(f) and who is an Accredited
Investor, (d) the Securities are sold pursuant to Rule 144, or (e) the Securities are sold pursuant to Regulation S under
the 1933 Act (or a successor rule) (“Regulation S”), and the Buyer shall have delivered to the Company, at the cost
of the Buyer, an opinion of counsel that shall be in form, substance and scope customary for opinions of counsel in corporate transactions,
which opinion shall be accepted by the Company; (ii) any sale of such Securities made in reliance on Rule 144 may be made only
in accordance with the terms of said Rule and further, if said Rule is not applicable, any re-sale of such Securities under circumstances
in which the seller (or the person through whom the sale is made) may be deemed to be an underwriter (as that term is defined in
the 1933 Act) may require compliance with some other exemption under the 1933 Act or the rules and regulations of the SEC thereunder;
and (iii) neither the Company nor any other person is under any obligation to register such Securities under the 1933 Act or any
state securities laws or to comply with the terms and conditions of any exemption thereunder (in each case). Notwithstanding the
foregoing or anything else contained herein to the contrary, the Securities may be pledged as collateral in connection with a bonafide
margin account or other lending arrangement.
g.
Legends. The Buyer understands that the Note and, until such time as the Conversion Shares have been registered under
the 1933 Act may be sold pursuant to Rule 144 or Regulation S without any restriction as to the number of securities as of a particular
date that can then be immediately sold, the Conversion Shares may bear a restrictive legend in substantially the following form
(and a stop-transfer order may be placed against transfer of the certificates for such Securities):
“NEITHER THE ISSUANCE AND
SALE OF THE SECURITIES REPRESENTED BY THIS CERTIFICATE NOR THE SECURITIES INTO WHICH THESE SECURITIES ARE EXERCISABLE HAVE
BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR APPLICABLE STATE SECURITIES LAWS. THE SECURITIES MAY NOT BE
OFFERED FOR SALE, SOLD, TRANSFERRED OR ASSIGNED (I) IN THE ABSENCE OF (A) AN EFFECTIVE REGISTRATION STATEMENT FOR THE
SECURITIES UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR (B) AN OPINION OF COUNSEL (WHICH COUNSEL SHALL BE SELECTED BY THE
HOLDER), IN A GENERALLY ACCEPTABLE FORM, THAT REGISTRATION IS NOT REQUIRED UNDER SAID ACT OR (II) UNLESS SOLD PURSUANT TO
RULE 144 OR RULE 144A UNDER SAID ACT. NOTWITHSTANDING THE FOREGOING, THE SECURITIES MAY BE PLEDGED IN CONNECTION WITH A BONA
FIDE MARGIN ACCOUNT OR OTHER LOAN OR FINANCING ARRANGEMENT SECURED BY THE SECURITIES.”
The legend set forth above
shall be removed and the Company shall issue a certificate without such legend to the holder of any Security upon which it is stamped,
if, unless otherwise required by applicable state securities laws, (a) such Security is registered for sale under an effective
registration statement filed under the 1933 Act or otherwise may be sold pursuant to Rule 144 or Regulation S without any restriction
as to the number of securities as of a particular date that can then be immediately sold, or (b) such holder provides the Company
with an opinion of counsel, in form, substance and scope customary for opinions of counsel in comparable transactions, to the effect
that a public sale or transfer of such Security may be made without registration under the 1933 Act, which opinion shall be accepted
by the Company so that the sale or transfer is effected. The Buyer agrees to sell all Securities, including those represented by
a certificate(s) from which the legend has been removed, in compliance with applicable prospectus delivery requirements, if any.In
the event that the Company does not accept the opinion of counsel provided by the Buyer with respect to the transfer of Securities
pursuant to an exemption from registration, such as Rule 144 or Regulation S, within 2 business days, it will be considered an
Event of Default under the Note.
h.
Authorization; Enforcement. This Agreement has been duly and validly authorized. This Agreement has been duly executed
and delivered on behalf of the Buyer, and this Agreement constitutes a valid and binding agreement of the Buyer enforceable in
accordance with its terms.
i.
Residency. The Buyer is a resident of the jurisdiction set forth immediately below the Buyer’s name on the
signature pages hereto.
3.
Representations and Warranties of the Company. The Company represents and warrants to the Buyer that:
a.
Organization and Qualification. The Company and each of its subsidiaries, if any, is a corporation duly organized,
validly existing and in good standing under the laws of the jurisdiction in which it is incorporated, with full power and authority
(corporate and other) to own, lease, use and operate its properties and to carry on its business as and where now owned, leased,
used, operated and conducted.
b. Authorization;
Enforcement. (i) The Company has all requisite corporate power and authority to enter into and perform this Agreement,
the Note and to consummate the transactions contemplated hereby and thereby and to issue the Securities, in accordance with
the terms hereof and thereof, (ii) the execution and delivery of this Agreement, the Note by the Company and the
consummation by it of the transactions contemplated hereby and thereby (including without limitation, the issuance of the
Note and the issuance and reservation for issuance of the Conversion Shares issuable upon conversion or exercise thereof)
have been duly authorized by the Company’s Board of Directors and no further consent or authorization of the Company,
its Board of Directors, or its shareholders is required, (iii) this Agreement has been duly executed and delivered by the
Company by its authorized representative, and such authorized representative is the true and official representative with
authority to sign this Agreement and the other documents executed in connection herewith and bind the Company accordingly,
and (iv) this Agreement constitutes, and upon execution and delivery by the Company of the Note, each of such instruments
will constitute, a legal, valid and binding obligation of the Company enforceable against the Company in accordance with its
terms.
c.
Issuance of Shares. The Conversion Shares are duly authorized and reserved for issuance and, upon conversion of the
Note in accordance with its respective terms, will be validly issued, fully paid and non-assessable, and free from all taxes, liens,
claims and encumbrances with respect to the issue thereof and shall not be subject to preemptive rights or other similar rights
of shareholders of the Company and will not impose personal liability upon the holder thereof.
d.
Acknowledgment of Dilution. The Company understands and acknowledges the potentially dilutive effect to the Common
Stock upon the issuance of the Conversion Shares upon conversion of the Note. The Company further acknowledges that its obligation
to issue Conversion Shares upon conversion of the Note in accordance with this Agreement, the Note is absolute and unconditional
regardless of the dilutive effect that such issuance may have on the ownership interests of other shareholders of the Company.
e. No
Conflicts. The execution, delivery and performance of this Agreement, the Note by the Company and the consummation by the
Company of the transactions contemplated hereby and thereby (including, without limitation, the issuance and reservation for
issuance of the Conversion Shares) will not (i) conflict with or result in a violation of any provision of the Certificate of
Incorporation or By-laws, or (ii) violate or conflict with, or result in a breach of any provision of, or constitute a
default (or an event which with notice or lapse of time or both could become a default) under, or give to others any rights
of termination, amendment, acceleration or cancellation of, any agreement, indenture, patent, patent license or instrument to
which the Company or any of its subsidiaries is a party, or (iii) result in a violation of any law, rule, regulation, order,
judgment or decree (including federal and state securities laws and regulations and regulations of any self-regulatory
organizations to which the Company or its securities are subject) applicable to the Company or any of its subsidiaries or by
which any property or asset of the Company or any of its subsidiaries is bound or affected (except for such conflicts,
defaults, terminations, amendments, accelerations, cancellations and violations as would not, individually or in the
aggregate, have a material adverse effect). All consents, authorizations, orders, filings and registrations which the Company
is required to obtain pursuant to the preceding sentence have been obtained or effected on or prior to the date hereof. The
Company is not in violation of the listing requirements of the National Quotations Bureau (the “OTCPK”) and does
not reasonably anticipate that the Common Stock will be delisted by the OTCPK in the foreseeable future, nor are the
Company’s securities “chilled” by FINRA. The Company and its subsidiaries are unaware of any facts or
circumstances which might give rise to any of the foregoing.
f.
Absence of Litigation. There is no action, suit, claim, proceeding, inquiry or investigation before or by any court,
public board, government agency, self-regulatory organization or body pending or, to the knowledge of the Company or any of its
subsidiaries, threatened against or affecting the Company or any of its subsidiaries, or their officers or directors in their capacity
as such, that could have a material adverse effect. Schedule 3(f) contains a complete list and summary description of any pending
or, to the knowledge of the Company, threatened proceeding against or affecting the Company or any of its subsidiaries, without
regard to whether it would have a material adverse effect. The Company and its subsidiaries are unaware of any facts or circumstances
which might give rise to any of the foregoing.
g.
Acknowledgment Regarding Buyer’ Purchase of Securities. The Company acknowledges and agrees that the Buyer
is acting solely in the capacity of arm’s length purchasers with respect to this Agreement and the transactions contemplated
hereby. The Company further acknowledges that the Buyer is not acting as a financial advisor or fiduciary of the Company (or in
any similar capacity) with respect to this Agreement and the transactions contemplated hereby and any statement made by the Buyer
or any of its respective representatives or agents in connection with this Agreement and the transactions contemplated hereby is
not advice or a recommendation and is merely incidental to the Buyer’ purchase of the Securities. The Company further represents
to the Buyer that the Company’s decision to enter into this Agreement has been based solely on the independent evaluation
of the Company and its representatives.
h.
No Integrated Offering. Neither the Company, nor any of its affiliates, nor any person acting on its or their behalf,
has directly or indirectly made any offers or sales in any security or solicited any offers to buy any security under circumstances
that would require registration under the 1933 Act of the issuance of the Securities to the Buyer. The issuance of the Securities
to the Buyer will not be integrated with any other issuance of the Company’s securities (past, current or future) for purposes
of any shareholder approval provisions applicable to the Company or its securities.
i.
Title to Property. The Company and its subsidiaries have good and marketable title in fee simple to all real property
and good and marketable title to all personal property owned by them which is material to the business of the Company and its subsidiaries,
in each case free and clear of all liens, encumbrances and defects except such as are described in Schedule 3(i) or such as would
not have a material adverse effect. Any real property and facilities held under lease by the Company and its subsidiaries are held
by them under valid, subsisting and enforceable leases with such exceptions as would not have a material adverse effect.
j. Bad
Actor. No officer or director of the Company would be disqualified under Rule 506(d) of the Securities Act as amended on
the basis of being a "bad actor" as that term is established in the September 19, 2013 Small Entity
Compliance Guide published by the Securities and Exchange Commission.
k.
Breach of Representations and Warranties by the Company. If the Company breaches any of the representations or warranties
set forth in this Section 3, and in addition to any other remedies available to the Buyer pursuant to this Agreement, it will be
considered an Event of default under the Note.
4.
COVENANTS.
a.
Expenses. At the Closing, the Company shall reimburse Buyer for expenses incurred by them in connection with the
negotiation, preparation, execution, delivery and performance of this Agreement and the other agreements to be executed in connection
herewith (“Documents”), including, without limitation, reasonable attorneys’ and consultants’ fees and
expenses, transfer agent fees, fees for stock quotation services, fees relating to any amendments or modifications of the Documents
or any consents or waivers of provisions in the Documents, fees for the preparation of opinions of counsel, escrow fees, and costs
of restructuring the transactions contemplated by the Documents. When possible, the Company must pay these fees directly, otherwise
the Company must make immediate payment for reimbursement to the Buyer for all fees and expenses immediately upon written notice
by the Buyer or the submission of an invoice by the Buyer.The Company’s obligation with respect to this transaction is to
reimburse Buyer’ expenses shall be $1,500 in legal fees which shall be deduced from the Note when funded.
b.
Listing. The Company shall promptly secure the listing of the Conversion Shares upon each national securities exchange
or automated quotation system, if any, upon which shares of Common Stock are then listed (subject to official notice of issuance)
and, so long as the Buyer owns any of the Securities, shall maintain, so long as any other shares of Common Stock shall be so listed,
such listing of all Conversion Shares from time to time issuable upon conversion of the Note. The Company will obtain and, so long
as the Buyer owns any of the Securities, maintain the listing and trading of its Common Stock on the OTCPK or any equivalent replacement
exchange, the Nasdaq National Market (“Nasdaq”), the Nasdaq SmallCap Market (“Nasdaq SmallCap”), the New
York Stock Exchange (“NYSE”), or the American Stock Exchange (“AMEX”) and will comply in all respects with
the Company’s reporting, filing and other obligations under the bylaws or rules of the Financial Industry Regulatory Authority
(“FINRA”) and such exchanges, as applicable. The Company shall promptly provide to the Buyer copies of any notices
it receives from the OTCPK and any other exchanges or quotation systems on which the Common Stock is then listed regarding the
continued eligibility of the Common Stock for listing on such exchanges and quotation systems.
c. Corporate
Existence. So long as the Buyer beneficially owns any Note, the Company shall maintain its corporate existence and shall
not sell all or substantially all of the Company’s assets, except in the event of a merger or consolidation or sale of
all or substantially all of the Company’s assets, where the surviving or successor entity in such transaction
(i) assumes the Company’s obligations hereunder and under the agreements and instruments entered into in connection
herewith and (ii) is a publicly traded corporation whose Common Stock is listed for trading on the OTCPK, Nasdaq, Nasdaq
SmallCap, NYSE or AMEX.
d.
No Integration. The Company shall not make any offers or sales of any security (other than the Securities) under
circumstances that would require registration of the Securities being offered or sold hereunder under the 1933 Act or cause the
offering of the Securities to be integrated with any other offering of securities by the Company for the purpose of any stockholder
approval provision applicable to the Company or its securities.
e.
Breach of Covenants. If the Company breaches any of the covenants set forth in this Section 4, and in addition to
any other remedies available to the Buyer pursuant to this Agreement, it will be considered an event of default under the Note.
5.
Governing Law; Miscellaneous.
a.
Governing Law. This Agreement shall be governed by and construed in accordance with the laws of the State of New
York without regard to principles of conflicts of laws. Any action brought by either party against the other concerning the transactions
contemplated by this Agreement shall be brought only in the state courts of New York or in the federal courts located in the state
and county of New York. The parties to this Agreement hereby irrevocably waive any objection to jurisdiction and venue of any action
instituted hereunder and shall not assert any defense based on lack of jurisdiction or venue or based upon forum non conveniens.
The Company and Buyer waive trial by jury. The prevailing party shall be entitled to recover from the other party its reasonable
attorney's fees and costs. In the event that any provision of this Agreement or any other agreement delivered in connection herewith
is invalid or unenforceable under any applicable statute or rule of law, then such provision shall be deemed inoperative to the
extent that it may conflict therewith and shall be deemed modified to conform with such statute or rule of law. Any such provision
which may prove invalid or unenforceable under any law shall not affect the validity or enforceability of any other provision of
any agreement. Each party hereby irrevocably waives personal service of process and consents to process being served in any suit,
action or proceeding in connection with this Agreement by mailing a copy thereof via registered or certified mail or overnight
delivery (with evidence of delivery) to such party at the address in effect for notices to it under this Agreement and agrees that
such service shall constitute good and sufficient service of process and notice thereof. Nothing contained herein shall be deemed
to limit in any way any right to serve process in any other manner permitted by law.
b.
Counterparts; Signatures by Facsimile. This Agreement may be executed in one or more counterparts, each of which
shall be deemed an original but all of which shall constitute one and the same agreement and shall become effective when counterparts
have been signed by each party and delivered to the other party. This Agreement, once executed by a party, may be delivered to
the other party hereto by facsimile transmission of a copy of this Agreement bearing the signature of the party so delivering this
Agreement.
c.
Headings. The headings of this Agreement are for convenience of reference only and shall not form part of, or affect
the interpretation of, this Agreement.
d.
Severability. In the event that any provision of this Agreement is invalid or unenforceable under any applicable
statute or rule of law, then such provision shall be deemed inoperative to the extent that it may conflict therewith and shall
be deemed modified to conform with such statute or rule of law. Any provision hereof which may prove invalid or unenforceable under
any law shall not affect the validity or enforceability of any other provision hereof.
e.
Entire Agreement; Amendments. This Agreement and the instruments referenced herein contain the entire understanding
of the parties with respect to the matters covered herein and therein and, except as specifically set forth herein or therein,
neither the Company nor the Buyer makes any representation, warranty, covenant or undertaking with respect to such matters. No
provision of this Agreement may be waived or amended other than by an instrument in writing signed by the majority in interest
of the Buyer.
f.
Notices. All notices, demands, requests, consents, approvals, and other communications required or permitted hereunder
shall be in writing and, unless otherwise specified herein, shall be (i) personally served, (ii) deposited in the mail, registered
or certified, return receipt requested, postage prepaid, (iii) delivered by reputable air courier service with charges prepaid,
or (iv) transmitted by hand delivery, telegram, or facsimile, addressed as set forth below or to such other address as such party
shall have specified most recently by written notice. Any notice or other communication required or permitted to be given hereunder
shall be deemed effective (a) upon hand delivery or delivery by facsimile, with accurate confirmation generated by the transmitting
facsimile machine, at the address or number designated below (if delivered on a business day during normal business hours where
such notice is to be received), or the first business day following such delivery (if delivered other than on a business day during
normal business hours where such notice is to be received) or (b) on the second business day following the date of mailing by
express courier service, fully prepaid, addressed to such address, or upon actual receipt of such mailing, whichever shall first
occur. The addresses for such communications shall be:
If to the Company, to:
Mind Solutions,
Inc.
3525 Del Mar Heights Road, Suite#802
San Diego, CA 92130
Attn: Kerry Driscoll, CEO
If to the Buyer:
LG CAPITAL FUNDING,
LLC
1218 Union Street,
Suite #2
Brooklyn, NY 11225
Attn: Joseph Lerman, Manager
Each party shall provide
notice to the other party of any change in address.
g.
Successors and Assigns. This Agreement shall be binding upon and inure to the benefit of the parties and their successors
and assigns. Neither the Company nor the Buyer shall assign this Agreement or any rights or obligations hereunder without the prior
written consent of the other. Notwithstanding the foregoing, the Buyer may assign its rights hereunder to any person that purchases
Securities in a private transaction from the Buyer or to any of its “affiliates,” as that term is defined under the
1934 Act, without the consent of the Company.
h.
Third Party Beneficiaries. This Agreement is intended for the benefit of the parties hereto and their respective
permitted successors and assigns, and is not for the benefit of, nor may any provision hereof be enforced by, any other person.
i.
Survival. The representations and warranties of the Company and the agreements and covenants set forth in this Agreement
shall survive the closing hereunder notwithstanding any due diligence investigation conducted by or on behalf of the Buyer. The
Company agrees to indemnify and hold harmless the Buyer and all their officers, directors, employees and agents for loss or damage
arising as a result of or related to any breach or alleged breach by the Company of any of its representations, warranties and
covenants set forth in this Agreement or any of its covenants and obligations under this Agreement, including advancement of expenses
as they are incurred.
j.
Further Assurances. Each party shall do and perform, or cause to be done and performed, all such further acts and
things, and shall execute and deliver all such other agreements, certificates, instruments and documents, as the other party may
reasonably request in order to carry out the intent and accomplish the purposes of this Agreement and the consummation of the transactions
contemplated hereby.
k.
No Strict Construction. The language used in this Agreement will be deemed to be the language chosen by the parties
to express their mutual intent, and no rules of strict construction will be applied against any party.
l.
Remedies. The Company acknowledges that a breach by it of its obligations hereunder will cause irreparable harm to
the Buyer by vitiating the intent and purpose of the transaction contemplated hereby. Accordingly, the Company acknowledges that
the remedy at law for a breach of its obligations under this Agreement will be inadequate and agrees, in the event of a breach
or threatened breach by the Company of the provisions of this Agreement, that the Buyer shall be entitled, in addition to all other
available remedies at law or in equity, and in addition to the penalties assessable herein, to an injunction or injunctions restraining,
preventing or curing any breach of this Agreement and to enforce specifically the terms and provisions hereof, without the necessity
of showing economic loss and without any bond or other security being required.
IN WITNESS WHEREOF, the
undersigned Buyer and the Company have caused this Agreement to be duly executed as of the date first above written.
Mind Solutions, Inc.
By: /s/ Kerry Driscoll
Name: Kerry Driscoll
Title: CEO
LG CAPITAL FUNDING, LLC.
By:_________________________________
Name: Joseph Lerman
Title: Manager
AGGREGATE SUBSCRIPTION AMOUNT:
Aggregate Principal Amount of Note: $31,500.00
Aggregate Purchase Price:
Note 1: $31,500.00 less $1,500.00 in legal
fees
EXHIBIT A
144 NOTE - $31,500
THE SECURITIES OFFERED
HEREBY HAVE NOT BEEN AND WILL NOT BE REGISTERED WITH THE UNITED STATES SECURITIES AND EXCHANGE COMMISSION OR THE SECURITIES COMMISSION
OF ANY STATE PURSUANT TO AN EXEMPTION FROM REGISTRATION PROVIDED BY SECTION 3(b) OF THE SECURITIES ACT OF 1933, AS AMENDED, AND
THE RULES AND REGULATIONS PROMULGATED THEREUNDER (THE "1933 ACT)
US $31,500.00
MIND SOLUTIONS, INC.
10% CONVERTIBLE REDEEMABLE NOTE
DUE FEBRUARY 10, 2016
FOR VALUE RECEIVED,
Mind Solutions, Inc.,(the “Company”) promises to pay to the order of LG CAPITAL FUNDING, LLC and its authorized successors
and permitted assigns ("Holder"), the aggregate principal face amount of Thirty One Thousand Five Hundred Dollars
exactly (U.S. $31,500.00) on February 10, 2016 ("Maturity Date") and to pay interest on the principal amount outstanding
hereunder at the rate of 10% per annum commencing on February 10, 2015. The interest will be paid to the Holder in whose name this
Note is registered on the records of the Company regarding registration and transfers of this Note. The principal of, and interest
on, this Note are payable at 1218 Union Street, Suite #2, Brooklyn, NY 11225initially, and if changed, last appearing on the records
of the Company as designated in writing by the Holder hereof from time to time. The Company will pay each interest payment and
the outstanding principal due upon this Note before or on the Maturity Date, less any amounts required by law to be deducted or
withheld, to the Holder of this Note by check or wire transfer addressed to such Holder at the last address appearing on the records
of the Company. The forwarding of such check or wire transfer shall constitute a payment of outstanding principal hereunder and
shall satisfy and discharge the liability for principal on this Note to the extent of the sum represented by such check or wire
transfer. Interest shall be payable in Common Stock (as defined below) pursuant to paragraph 4(b) herein.
This Note is subject
to the following additional provisions:
1. This Note is exchangeable for
an equal aggregate principal amount of Notes of different authorized denominations, as requested by the Holder surrendering the
same. No service charge will be made for such registration or transfer or exchange, except that Holder shall pay any tax or other
governmental charges payable in connection therewith.
2. The Company shall be entitled
to withhold from all payments any amounts required to be withheld under applicable laws.
3. This Note may be transferred
or exchanged only in compliance with the Securities Act of 1933, as amended ("Act") and applicable state securities
laws. Any attempted transfer to a non-qualifying party shall be treated by the Company as void. Prior to due presentment for transfer
of this Note, the Company and any agent of the Company may treat the person in whose name this Note is duly registered on the Company's
records as the owner hereof for all other purposes, whether or not this Note be overdue, and neither the Company nor any such agent
shall be affected or bound by notice to the contrary. Any Holder of this Note electing to exercise the right of conversion set
forth in Section 4(a) hereof, in addition to the requirements set forth in Section 4(a), and any prospective transferee of this
Note, also is required to give the Company written confirmation that this Note is being converted ("Notice of Conversion")
in the form annexed hereto as Exhibit A. The date of receipt (including receipt by telecopy) of such Notice of Conversion
shall be the Conversion Date.
4. (a) The Holder of this Note
is entitled, at its option, at any time, and after full cash payment for the shares convertible hereunder,to convert all or any
amount of the principal face amount of this Note then outstanding into shares of the Company's common stock (the "Common
Stock") at a price ("Conversion Price") for each share of Common Stock equal to 55% of the lowest
closing bid priceof the Common Stock as reported on the National Quotations Bureau OTCPK exchange which the Company’s
shares are traded or any exchange upon which the Common Stock may be traded in the future ("Exchange"), for the
tenpriortrading days including the day upon which a Notice of Conversion is received by the Company (provided
such Notice of Conversion is delivered by fax or other electronic method of communication to the Company after 4 P.M. Eastern Standard
or Daylight Savings Time if the Holder wishes to include the same day closing price). If the shares have not been delivered within
3 business days, the Notice of Conversion may be rescinded. Such conversion shall be effectuated by the Company delivering the
shares of Common Stock to the Holder within 3 business days of receipt by the Company of the Notice of Conversion. Once the Holder
has received such shares of Common Stock, the Holder shall surrender this Note to the Company, executed by the Holder evidencing
such Holder's intention to convert this Note or a specified portion hereof, and accompanied by proper assignment hereof in blank.
Accrued but unpaid interest shall be subject to conversion. No fractional shares or scrip representing fractions of shares will
be issued on conversion, but the number of shares issuable shall be rounded to the nearest whole share. In the event the Company
experiences a DTC “Chill” on its shares, the conversion price shall be decreased to 45% instead of 55% while that “Chill”
is in effect.In no event shall the Holder be allowed to effect a conversion if such conversion, along with all other shares
of Company Common Stock beneficially owned by the Holder and its affiliates would exceed 9.9% of the outstanding shares of the
Common Stock of the Company.
(b) Interest on any unpaid principal
balance of this Note shall be paid at the rate of 10% per annum. Interest shall be paid by the Company in Common Stock ("Interest
Shares"). The dollar amount converted into Interest Shares shall be all or a portion of the accrued interest calculated on
the unpaid principal balance of this Note to the date of such notice.
(c) During the first six months
this Note is in effect, the Company may redeem this Note by paying to the Holder an amount as follows: (i) if the redemption is
within the first 90 days this Note is in effect, then for an amount equal to 130% of the unpaid principal amount of this Note along
with any earned interest, (ii) if the redemption is after the 91st day this Note is in effect but less than the 150thday
this Note is in effect, then for an amount equal to 140% of the unpaid principal amount of this Note along with any earned interest,
(iii) if the redemption is after the 151stday this Note is in effect but less than the 180th day this Note
is in effect, then for an amount equal to 150% of the unpaid principal amount of this Note along with any earned interest. This
Note may not be redeemed after 180 days. The redemption must be closed and paid for within 3 business days of the Company sending
the redemption demand or the redemption will be invalid and the Company may not redeem this Note.
(d) Upon (i) a transfer of all
or substantially all of the assets of the Company to any person in a single transaction or series of related transactions, (ii)
a reclassification, capital reorganization or other change or exchange of outstanding shares of the Common Stock, or (iii) any
consolidation or merger of the Company with or into another person or entity in which the Company is not the surviving entity (other
than a merger which is effected solely to change the jurisdiction of incorporation of the Company and results in a reclassification,
conversion or exchange of outstanding shares of Common Stock solely into shares of Common Stock) (each of items (i), (ii) and (iii)
being referred to as a "Sale Event"), then, in each case, the Company shall, upon request of the Holder, redeem this
Note in cash for 150% of the principal amount, plus accrued but unpaid interest through the date of redemption, or at the election
of the Holder, such Holder may convert the unpaid principal amount of this Note (together with the amount of accrued but unpaid
interest) into shares of Common Stock immediately prior to such Sale Event at the Conversion Price.
(e) In case of any Sale Event
in connection with which this Note is not redeemed or converted, the Company shall cause effective provision to be made so that
the Holder of this Note shall have the right thereafter, by converting this Note, to purchase or convert this Note into the kind
and number of shares of stock or other securities or property (including cash) receivable upon such reclassification, capital reorganization
or other change, consolidation or merger by a holder of the number of shares of Common Stock that could have been purchased upon
exercise of the Note and at the same Conversion Price, as defined in this Note, immediately prior to such Sale Event. The foregoing
provisions shall similarly apply to successive Sale Events. If the consideration received by the holders of Common Stock is other
than cash, the value shall be as determined by the Board of Directors of the Company or successor person or entity acting in good
faith.
5. No provision of this Note shall
alter or impair the obligation of the Company, which is absolute and unconditional, to pay the principal of, and interest on, this
Note at the time, place, and rate, and in the form, herein prescribed.
6. The Company hereby expressly
waives demand and presentment for payment, notice of non-payment, protest, notice of protest, notice of dishonor, notice of acceleration
or intent to accelerate, and diligence in taking any action to collect amounts called for hereunder and shall be directly and
primarily liable for the payment of all sums owing and to be owing hereto.
7. The Company agrees to pay all
costs and expenses, including reasonable attorneys' fees and expenses, which may be incurred by the Holder in collecting any amount
due under this Note.
8. If one or more of the following
described "Events of Default" shall occur:
(a) The Company shall default in
the payment of principal or interest on this Note or any other note issued to the Holder by the Company; or
(b) Any of the representations
or warranties made by the Company herein or in any certificate or financial or other written statements heretofore or hereafter
furnished by or on behalf of the Company in connection with the execution and delivery of this Note, or the Securities Purchase
Agreement under which this note was issued shall be false or misleading in any respect; or
(c) The Company shall fail to perform
or observe, in any respect, any covenant, term, provision, condition, agreement or obligation of the Company under this Note or
any other note issued to the Holder, and not cure such failure within 10 days of such event; or
(d) The Company shall (1) become
insolvent; (2) admit in writing its inability to pay its debts generally as they mature; (3) make an assignment for the benefit
of creditors or commence proceedings for its dissolution; (4) apply for or consent to the appointment of a trustee, liquidator
or receiver for its or for a substantial part of its property or business; (5) file a petition for bankruptcy relief, consent to
the filing of such petition or have filed against it an involuntary petition for bankruptcy relief, all under federal or state
laws as applicable; or
(e) A trustee, liquidator or receiver
shall be appointed for the Company or for a substantial part of its property or business without its consent and shall not be discharged
within thirty (30) days after such appointment; or
(f) Any governmental agency or
any court of competent jurisdiction at the instance of any governmental agency shall assume custody or control of the whole or
any substantial portion of the properties or assets of the Company; or
(g) One or more money judgments,
writs or warrants of attachment, or similar process, in excess of fifty thousand dollars ($50,000) in the aggregate, shall be entered
or filed against the Company or any of its properties or other assets and shall remain unpaid, unvacated, unbonded or unstayed
for a period of fifteen (15) days or in any event later than five (5) days prior to the date of any proposed sale thereunder; or
(h) Defaulted on or breached any
term of any other note of similar debt instrument into which the Company has entered and failed to cure such default within the
appropriate grace period; or
(i) The Company shall have its
Common Stock delisted from an exchange (including the OTCBB exchange) or, if the Common Stock trades on an exchange, then trading
in the Common Stock shall be suspended for more than 10 consecutive days;
(j) Intentionally Deleted;
(k) The Company shall not deliver
to the Holder the Common Stock pursuant to paragraph 4 herein without restrictive legend within 3 business days of its receipt
of a Notice of Conversion; or
(l) The Company shall not replenish
the reserve set forth in Section 12, within 3 business days of the request of the Holder.
(m) The Company shall not be “current”
in its filings with the Securities and Exchange Commission; or
(n) The Company shall lose the
“bid” price for its stock in a market (including the OTCPK marketplace or other exchange).
Then, or at any time thereafter, unless
cured within 5 days, and in each and every such case, unless such Event of Default shall have been waived in writing by the Holder
(which waiver shall not be deemed to be a waiver of any subsequent default) at the option of the Holder and in the Holder's sole
discretion, the Holder may consider this Note immediately due and payable, without presentment, demand, protest or (further) notice
of any kind (other than notice of acceleration), all of which are hereby expressly waived, anything herein or in any note or other
instruments contained to the contrary notwithstanding, and the Holder may immediately, and without expiration of any period of
grace, enforce any and all of the Holder's rights and remedies provided herein or any other rights or remedies afforded by law.
Upon an Event of Default, interest shall accrue at a default interest rate of 24% per annum or, if such rate is usurious or not
permitted by current law, then at the highest rate of interest permitted by law. In the event of a breach of Section 8(k) the penalty
shall be $250 per day the shares are not issued beginning on the 4th day after the conversion notice was delivered to
the Company. This penalty shall increase to $500 per day beginning on the 10th day. The penalty for a breach of Section
8(n) shall be an increase of the outstanding principal amounts by 20%. In case of a breach of Section 8(i), the outstanding principal
due under this Note shall increase by 50%. If this Note is not paid at maturity, the outstanding principal due under this Note
shall increase by 10%.
If the Holder shall commence an action
or proceeding to enforce any provisions of this Note, including, without limitation, engaging an attorney, then if the Holder prevails
in such action, the Holder shall be reimbursed by the Company for its attorneys’ fees and other costs and expenses incurred
in the investigation, preparation and prosecution of such action or proceeding.
Make-Whole for Failure
to Deliver Loss. At the Holder’s election, if the Company fails for any reason,except in circumstances beyond the control
of the Company through an act of god , to deliver to the Holder the conversion shares by the by the 3rd business day following
the delivery of a Notice of Conversion to the Company and if the Holder incurs a
Failure to Deliver Loss, then at any time
the Holder may provide the Company written notice indicating the amounts payable to the Holder in respect of the Failure to Deliver
Loss and the Company must make the Holder whole as follows:
Failure to Deliver Loss = [(High trade
price at any time on or after the day of exercise) x (Number of conversion shares)]
The Company must pay the Failure to Deliver
Loss by cash payment, and any such cash payment must be made by the third business day from the time of the Holder’s written
notice to the Company.
9. In case any provision of this
Note is held by a court of competent jurisdiction to be excessive in scope or otherwise invalid or unenforceable, such provision
shall be adjusted rather than voided, if possible, so that it is enforceable to the maximum extent possible, and the validity and
enforceability of the remaining provisions of this Note will not in any way be affected or impaired thereby.
10. Neither this Note nor any term
hereof may be amended, waived, discharged or terminated other than by a written instrument signed by the Company and the Holder.
11. The Company represents that
it is not a “shell” issuer and has never been a “shell” issuer or that if it previously has been a “shell”
issuer that at least 12 months have passed since the Company has reported form 10 type information indicating it is no longer
a “shell issuer. Further. The Company will instruct its counsel to either (i) write a 144- 3(a)(9) opinion to allow for
salability of the conversion shares or (ii) accept such opinion from Holder’s counsel.
12. The Company shall issue irrevocable
transfer agent instructions reserving 254,545,000 shares of its Common Stock for conversions under this Note (the “Share
Reserve”). Upon full conversion of this Note, any shares remaining in the Share Reserve shall be cancelled. The Company
shall pay all costs associated with issuing and delivering the shares. The company should at all times reserve a minimum of four
times the amount of shares required if the note would be fully converted. The Holder may reasonably request increases from
time to time to reserve such amounts.
13. The Company will give the Holder
direct notice of any corporate actions including but not limited to name changes, stock splits, recapitalizations etc. This notice
shall be given to the Holder as soon as possible under law.
14. This Note shall be governed
by and construed in accordance with the laws of New York applicable to contracts made and wholly to be performed within the State
of New York and shall be binding upon the successors and assigns of each party hereto. The Holder and the Company hereby mutually
waive trial by jury and consent to exclusive jurisdiction and venue in the courts of the State of New York. This Agreement may
be executed in counterparts, and the facsimile transmission of an executed counterpart to this Agreement shall be effective as
an original.
IN WITNESS WHEREOF,
the Company has caused this Note to be duly executed by an officer thereunto duly authorized.
Dated: 2-10-15
MIND SOLUTIONS, INC.
By: /s/ Kerry Driscoll
Title: CEO
EXHIBIT A
NOTICE OF CONVERSION
(To be Executed by
the Registered Holder in order to Convert the Note)
The undersigned hereby
irrevocably elects to convert $_____________ of the above Note into__________ Shares of Common
Stock of Mind Solutions, Inc,(“Shares”) according to the conditions set forth in such Note, as of the date written
below.
If Shares are to be
issued in the name of a person other than the undersigned, the undersigned will pay all transfer and other taxes and charges payable
with respect thereto.
Date of Conversion: ___________________________
Applicable Conversion Price: ___________________________
Signature: ___________________________
[Print Name of Holder and Title of Signer]
Address: ___________________________
___________________________
SSN or EIN: ___________________________
Shares are to be registered in the following name: ___________________________
Name: ___________________________
Address: ___________________________
Tel: ___________________________
Fax: ___________________________
SSN or EIN: ___________________________
Shares are to be sent or delivered to the following account:
Account Name: ___________________________
Address: ___________________________
Exhibit 31.1
CERTIFICATION OF CHIEF EXECUTIVE OFFICER
AS ADOPTED PURSUANT TO SECTION 302 OF THE SARBANES-OXLEY ACT OF 2002
I, Kerry Driscoll, certify that:
1.
I have reviewed this Form 10-K, of Mind Solutions, Inc.;
2.
Based on my knowledge, this report does not contain any untrue statement of a material fact
or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements
were made, not misleading with respect to the period covered by this report;
3.
Based on my knowledge, the financial statements, and other financial information included
in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant
as of, and for, the periods present in this report;
4.
The registrant’s other certifying officer(s) and I are responsible for establishing
and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control
over financial reporting (as defined in Exchange Act Rules 13-a-15(f) and 15d-15(f)) for the registrant and have:
(a)
Designed such disclosure controls and procedures, or caused such disclosure controls and procedures
to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated
subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being
prepared;
(b)
Designed such internal control over financial reporting, or caused such internal control over
financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial
reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principals;
(c)
Evaluated the effectiveness of the registrant’s disclosure controls and procedures and
presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the
period covered by this report based on such evaluation; and
(d)
Disclosed in this report any change in the registrant’s internal control over financial
reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter
in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s
internal control over financial reporting; and
5.
The registrant’s other certifying officer(s) and I have disclosed, based on our most
recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the
registrant’s board of directors (or persons performing the equivalent functions):
(a)
All significant deficiencies and material weaknesses in the design or operation of internal
control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process,
summarize and Report financial information; and
(b)
Any fraud, whether or not material, that involved management or other employees who have a
significant role in the registrant’s internal control over financial reporting.
Date: March 10, 2015.
/s/ Kerry Driscoll
Kerry Driscoll, Chief Executive Officer
Exhibit 31.2
CERTIFICATION OF CHIEF FINANCIAL OFFICER
AS ADOPTED PURSUANT TO SECTION 302 OF THE SARBANES-OXLEY ACT OF 2002
I, Kerry Driscoll, certify that:
1.
I have reviewed this Form 10-K, of Mind Solutions, Inc.;
2.
Based on my knowledge, this report does not contain any untrue statement of a material fact
or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements
were made, not misleading with respect to the period covered by this report;
3.
Based on my knowledge, the financial statements, and other financial information included
in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant
as of, and for, the periods present in this report;
4.
The registrant’s other certifying officer(s) and I are responsible for establishing
and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control
over financial reporting (as defined in Exchange Act Rules 13-a-15(f) and 15d-15(f)) for the registrant and have:
(a)
Designed such disclosure controls and procedures, or caused such disclosure controls and procedures
to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated
subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being
prepared;
(b)
Designed such internal control over financial reporting, or caused such internal control over
financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial
reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principals;
(c)
Evaluated the effectiveness of the registrant’s disclosure controls and procedures and
presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the
period covered by this report based on such evaluation; and
(d)
Disclosed in this report any change in the registrant’s internal control over financial
reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter
in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s
internal control over financial reporting; and
5.
The registrant’s other certifying officer(s) and I have disclosed, based on our most
recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the
registrant’s board of directors (or persons performing the equivalent functions):
(a)
All significant deficiencies and material weaknesses in the design or operation of internal
control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process,
summarize and Report financial information; and
(b)
Any fraud, whether or not material, that involved management or other employees who have a
significant role in the registrant’s internal control over financial reporting.
Date: March 10, 2015.
/s/ Kerry Driscoll
Kerry Driscoll, Chief Financial Officer and Principal Accounting Officer
Exhibit 32.1
CERTIFICATION OF CHIEF EXECUTIVE OFFICER
PURSUANT TO 18 U.S.C. SECTION 1350
AS ADOPTED PURSUANT TO
SECTION 906 OF THE SARBANES-OXLEY
ACT OF 2002
In connection with the accompanying Annual
Report on Form 10-K of Mind Solutions, Inc. for the fiscal year ending December 31, 2014, I, Kerry Driscoll, Chief Executive Officer
of Mind Solutions, Inc., hereby certify pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley
Act of 2002, to the best of my knowledge and belief, that:
1.
Such Annual Report on Form 10-K for the fiscal year ending December 31, 2014, fully complies
with the requirements of section 13(a) or 15(d) of the Securities Exchange Act of 1934; and
2.
The information contained in such Annual Report on Form 10-K for the fiscal year ending December
31, 2014, fairly presents, in all material respects, the financial condition and results of operations of Mind Solutions, Inc.
Date: March 10, 2015.
/s/ Kerry Driscoll
Kerry Driscoll, Chief Executive Officer of
Mind Solutions, Inc.
Exhibit 32.2
CERTIFICATION OF CHIEF FINANCIAL OFFICER
PURSUANT TO 18 U.S.C. SECTION 1350
AS ADOPTED PURSUANT TO
SECTION 906 OF THE SARBANES-OXLEY
ACT OF 2002
In connection with the accompanying Annual
Report on Form 10-K of Mind Solutions, Inc. for the fiscal year ending December 31, 2014, I, Kerry Driscoll, Chief Financial Officer
and Principal Accounting Officer of Mind Solutions, Inc., hereby certify pursuant to 18 U.S.C. Section 1350, as adopted pursuant
to Section 906 of the Sarbanes-Oxley Act of 2002, to the best of my knowledge and belief, that:
1.
Such Annual Report on Form 10-K for the fiscal year ending December 31, 2014, fully complies
with the requirements of section 13(a) or 15(d) of the Securities Exchange Act of 1934; and
2.
The information contained in such Annual Report on Form 10-K for the fiscal year ending December
31, 2014, fairly presents, in all material respects, the financial condition and results of operations of Mind Solutions, Inc.
Date: March 10, 2015
/s/ Kerry Driscoll
Kerry Driscoll, Chief Financial Officer and
Principal Accounting Officer of
Mind Solutions, Inc.
Mind Solutions (CE) (USOTC:VOIS)
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