Introduction
Prior to the Change in Control Transaction that took place on January 9, 2019,
we were a lifelogging software company that developed and hosted a proprietary
cloud-based software solution ?accessible on iOS and Android devices that offers
an enhanced media experience for consumers by augmenting ?videos, livestreams
and photos with additional context information and provided platform that makes
it easy to ?find and use that data when viewing or sharing media. Subsequent to
the Change in Control Transaction, we changed the business plan wherein we
intend to be structured as a holding company ?with a business strategy focused
on owning subsidiaries engaged in a number of diverse business activities.?
Accordingly results of operations for the year ended December 31, 2019 are not
comparable with results of operations for the year ended December 31, 2018.
Results of Operations
The following comparative analysis on results of operations was based primarily
on the comparative audited consolidated financial statements, footnotes and
related information for the periods identified below and should be read in
conjunction with the consolidated financial statements and the notes to those
statements that are included elsewhere in this report.
Revenue
The Company had no revenues in 2019 nor 2018. The Company currently cannot
predict when the Company will become revenue producing.
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Operating Expenses
Total operating expenses for 2019 increased by $201,120, compared to 2018,
mainly as a result of an increase in general and administrative, expenses
incurred in connection with the Company's decision to broaden its business
strategy.
Other Expenses
Other expenses for 2019 decreased by $946,097 compared 2018 as a result of the
retiring and/or cancellation of all derivative warrants and notes, together with
a material decrease in interest expense.
Net Profit (Loss)
The net profit for 2019 was $222,839, an increase of $1,367,535 compared to a
net loss in 2018 of $1,144,696, as a result of decreases in other expenses as
discussed above partially offset by an increase in general administrative
expenses.
Liquidity and Capital Resources
Liquidity is the ability of an enterprise to generate adequate amounts of cash
to meet its needs for cash requirements. As of December 31, 2019, our working
capital deficit amounted to $14,067 a decrease of $3,038,252 as compared to
$3,052,319 as of December 31, 2018. This decrease is primarily a result of a
decrease in accounts payable, notes payable and derivative liabilities partially
offset by an increase in current assets.
Net cash used in operating activities was $3,865,334 during 2019 compared to
$781 in 2018. The increase in cash used in operating activities is primarily
attributable to our net loss increasing from ($1,144,696) in fiscal 2018 to
$222,839 in fiscal 2019 coupled with the retirement and/or cancellation of all
of the Company's derivative warrant and notes partially offset by an increase in
accounts payable and accrued expenses.
Net cash provided by financing activities during 2019 was $33,870,020 compared
to $0 in 2018.
Capital Resources
We believe that the Equity Purchase Agreement and Note Purchase Agreement
described in "Item 1. Business - Recent Developments" will afford us with
sufficient financing to cover immediate our projected operating expenses and
working capital needs. However, in order to execute our business plan, we
potentially will have to issue additional debt or equity or enter into a
strategic arrangement with a third party to carry out some aspects of our
business plan. There can be no assurance that additional capital will be
available to us on commercially reasonable terms when needed.
Going Concern Consideration
We had an accumulated deficit of $6,905,767 as of December 31, 2019. Our ability
to continue as a going concern is dependent on our ability to raise additional
capital and generate additional revenues and profits from our business plan.
In the opinion of our independent registered public accounting firm for our
fiscal year end December 31, 2019, our auditor included a statement that as a
result of our deficit accumulated on December 31, 2019, our net loss and net
cash used in operating activities for the reporting period then ended, there is
a substantial doubt as our ability to continue as a going concern without rising
additional capital and generating additional revenues and profits from our
business plan. The consolidated financial statements do not include any
adjustments that might result from the outcome of this uncertainty.
Off-Balance Sheet Arrangements
As of December 31, 2019, we have no off-balance sheet arrangements.
Critical Accounting Policies
Our significant accounting policies are disclosed in Note 2 of our Financial
Statements included elsewhere in this Annual Report on Form 10-K.
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