VOIS Mind Solutions Inc (CE)

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, 2013, and December 31, 2012:

At December 31, 2013, our working capital deficit decreased as compared to December 31, 2012, primarily as a result of an increase in derivative liability of $19,907,242.

Operating Activities

Net cash used for continuing operating activities during fiscal 2013 was $388,177 as compared to $159,869 for fiscal 2012. Non-cash items totaling approximately $21,749,389 contributing to the net cash used in continuing operating activities for fiscal 2013 include:

Net cash used for continuing operating activities during fiscal 2012 was $159,869. Non-cash items totaling approximately $787,057 contributing to the net cash used in continuing operating activities for fiscal 2012 include:

Investing Activities

Net cash used in investing activities was $0 for both fiscal 2013 and 2012.

Three Months Ended March 31, 2014, Compared to Three Months Ended March 31, 2013.

Revenues. During the three months ended March 31, 2014, and 2013, we recognized $31,111 and $0 of revenues. The $31,111 of service revenues recognized was from stock received by us from a costumer as payment for consulting services. The customer is a publically traded company on the OTCQB. We are aggressively looking for ways to leverage our technology to develop revenue streams.

General and Administrative Expenses.

Consulting Fees . During the three months ended March 31, 2014, consulting expense decreased to $398,234 as compared to $847,881 from the prior three months ended March 31, 2013. The decrease was primarily the result of less stock being issued to consultants for services rendered to Mind Solutions.

Professional Fees . During the three months ended March 31, 2014, professional fees decreased to $28,827 as compared to $37,233 from the prior three months ended March 31, 2013. Professional fees decreased primarily from less services needed. Last year, Mind Solutions had additional professional fees due to the merger with Mind Solutions, Inc.

Selling, General and Administrative Expense . During the three months ended March 31, 2014, selling, general and administrative expenses decreased to $23,472 as compared to $69,685 from the prior three months ended March 31, 2013. The decrease was due primarily to less travel, meals and entertainment, and marketing expenses.

Interest Expense . During the three months ended March 31, 2014, interest expense increased to $17,637 as compared to $9,785 from the prior three months ended March 31, 2013. The increase was due to additional interest expense accrued pertaining to the outstanding notes payable.

Derivative Interest . During the three months ended March 31, 2014, derivative interest expense decreased to $0 as compared to $41,003 from the prior three months ended March 31, 2013. The decrease was due to less derivative liability calculated using the Black Scholes Model regarding the newly issued convertible debentures.

Forgiveness of Debt . During the three months ended March 31, 2014, forgiveness of debt was $0 as compared to $111,610 for the three months ended March 31, 2013. The decrease was due to the dissolution of an affiliated entity to Mind Solutions which was recorded as an accounts payable to related parties.

Net Loss . Our net loss from operations decreased to $437,059 for the three months ended March 31, 2014 and $893,977 for the three months ended March 31, 2013.

At March 31, 2014, our working capital deficit increased as compared to December 31, 2013, primarily as a result of a decrease in derivative liability of $14,062,385.

Operating Activities

Net cash used for continuing operating activities during the three months ended March 31, 2014 was $144,495 as compared to $114,902 for the three months ended March 31, 2013. Non-cash items totaling approximately $292,564 contributing to the net cash used in continuing operating activities for the three months ended March 31, 2014 include:

Net cash used for continuing operating activities for the three months ended March 31, 2013 was $114,902. Non-cash items totaling approximately $779,075 contributing to the net cash used in continuing operating activities for the three months ended March 31, 2013 include:

Investing Activities

Net cash used in investing activities was $0 for both three months ended March 31, 2014, and 2013.

Financing Activities

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:

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:

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, and on June 24, 2014, less than 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. After allowing for previous conversions, $81,667 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, $81,667 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 . On February 4, 2014, we executed a Securities Purchase Agreement with LG Capital Funding, LLC, whereby we issued convertible promissory notes in an aggregate amount of $50,000 to LG Capital Funding, LLC bearing interest on the unpaid balance at the rate of 10 percent, as follows:

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.

A copy of the Securities Purchase Agreement and the convertible promissory note in favor of LG Capital Funding, LLC was filed as an exhibit with the SEC.

GEL Properties, LLC Financing . 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.

A copy of the convertible promissory note in favor of GEL Properties, LLC was filed as an exhibit with the SEC.

Premier Venture Partners, LLC Financing. On March 11, 2014, 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 187,234,043 shares of our common stock by Premier pursuant to a “put right.” The Equity Purchase Agreement permits us to “put” up to $1,000,000.00 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 will not receive any proceeds from the sale of the shares of our common stock offered by Premier. However, we will receive proceeds from the sale of securities pursuant to our exercise of the put right described in the Equity Purchase Agreement. We will bear all costs associated with the registration.

We have assumed that we will issue not more than 187,234,043 shares pursuant to the exercise of our put right under the Equity Purchase Agreement, although the number of shares that we will actually issue pursuant to that put right may be more or less than 187,234,043, depending on the trading price of our common stock. We currently do not intend to exercise the put right in a manner which would result in our issuance of more than 187,234,043 shares, but if we were to exercise the put right in that manner, we would be required to file a subsequent registration statement with the SEC and that registration statement would have to be declared effective prior to the issuance of any additional shares.

As mentioned above, we have already issued to Premier 12,765,957 shares of our common stock as Initial Commitment Shares in connection with the Equity Purchase Agreement. The shares issued to Premier were restricted in their transfer as required by the Securities Act. Pursuant to the Equity Purchase Agreement, we have agreed to register for resale by means of a registration statement to be filed with the SEC the 12,765,957 shares of our common stock as Initial Commitment Shares.

Subject to the terms and conditions of the transaction documents, as described in the Equity Purchase Agreement, and from time to time during the Open Period, Mind Solutions may, in its sole discretion, deliver a Put Notice to Premier which states the number of shares of our common stock that Mind Solutions intends to sell to Premier on a Closing Date (the “Put”). The maximum number of shares of our common stock that Mind Solutions shall be entitled to Put to Premier per any applicable Put Notice (the “Put Amount”) shall not exceed the lesser of:

Premier has indicated that it will resell those shares in the open market, resell our shares to other investors through negotiated transactions, or hold our shares in its portfolio. The obligations of Premier under the Equity Purchase Agreement are not transferable and the registration statement will not cover sales of our common stock by transferees of Premier.

Notwithstanding anything to the contrary in the Equity Purchase Agreement, Mind Solutions shall not be entitled to deliver a Put Notice and Premier shall not be obligated to purchase any shares of our common stock at a Closing unless each of the following conditions are satisfied:

If any of the events described in the bullet points immediately above occurs during a Pricing Period, then Premier shall have no obligation to purchase the Put Amount of Common Stock set forth in the applicable Put Notice.

Subject to the satisfaction of the conditions set forth in Sections 2.5, 7 and 8 of the Equity Purchase Agreement, the closing of the purchase by Premier of shares of our common stock (a “Closing”) shall occur on the date which is the sixth Trading Day following the applicable Put Notice Date (each a “Closing Date”). Upon each such Closing Date, Mind Solutions shall use all commercially reasonable efforts to cause its transfer agent to electronically transmit the Securities by crediting the account of Premier’s prime broker (as specified by Premier within a time reasonably in advance of Premier’s notice) with DTC through its Deposit Withdrawal Agent Commission (“DWAC”) system. Within one business day after receipt of the securities, Premier shall deliver to Mind Solutions the Purchase Price to be paid for such shares of our common stock, determined as set forth in Section 2.5 of the Equity Purchase Agreement. Notwithstanding the preceding sentence, to the extent that the Purchase Price for any particular Put would exceed $65,000, then the amount over $65,000 may be paid by Premier within 10 Trading Days after Premier’s receipt of the Securities.

Purchase Price . The Purchase Price for the Securities for each Put shall be the Put Amount multiplied by 75 percent of the lowest individual daily VWAP of the shares of our common stock during the Pricing Period less $650.

Overall limit on Common Stock Issuable . Notwithstanding anything contained in the Equity Purchase Agreement to the contrary, if during the Open Period, Mind Solutions becomes listed on an exchange that limits the number of shares of our common stock that may be issued without stockholder approval, then the number of shares of our common stock issuable by Mind Solutions and purchasable by Premier, shall not exceed that number of the shares of our common stock that may be issuable without stockholder approval (the “Maximum Common Stock Issuance”). If such issuance of shares of our common stock could cause a delisting on the Principal Market, then the Maximum Common Stock Issuance shall first be approved by Mind Solutions’ stockholders in accordance with applicable law and the bylaws and the articles of incorporation of Mind Solutions, if such issuance of shares of our common stock could cause a delisting on the Principal Market. The parties understand and agree that Mind Solutions’ failure to seek or obtain such stockholder approval shall in no way adversely affect the validity and due authorization of the issuance and sale of Securities or Premier’s obligation in accordance with the terms and conditions hereof to purchase a number of shares of our common stock in the aggregate up to the Maximum Common Stock Issuance limitation, and that such approval pertains only to the applicability of the Maximum Common Stock Issuance limitation provided in Section 2.6 of the Equity Purchase Agreement.

Failure to Deliver Shares of our Common Stock . If after one Trading Day following any Closing Date, Mind Solutions has failed to deliver any Securities pursuant to the Equity Purchase Agreement (and such failure is not caused by Premier), then the Pricing Period for such Put Notice shall be extended from the fifth Trading Day following a Put Notice until the date which is the Trading Day immediately prior to the date which the Securities are actually received by Premier.

Limitation on Amount of Ownership . Notwithstanding anything to the contrary in Equity Purchase Agreement, in no event shall Premier be entitled to purchase that number of shares of our common stock, which when added to the sum of the number of shares of our common stock beneficially owned (as such term is defined under Section 13(d) and Rule 13d-3 of the Exchange Act), by Premier, would exceed 4.99 percent of the number of shares of our common stock outstanding on the Closing Date, as determined in accordance with Rule 13d-1(j) of the Exchange Act.

The Equity Purchase Agreement will terminate when any of the following events occur:

Any and all shares, or penalties, if any, due under the Equity Purchase Agreement shall be immediately payable and due upon termination of the agreement.

As we draw down on the Equity Purchase Agreement, shares of our common stock will be sold into the market by Premier. The sale of these additional shares could cause our stock price to decline. In turn, if the stock price declines and we issue more puts, more shares will come into the market, which could cause a further drop in the stock price. You should be aware that there is an inverse relationship between the market price of our common stock and the number of shares to be issued under the Equity Purchase Agreement. If our stock price declines, we will be required to issue a greater number of shares under the Equity Purchase Agreement. We have no obligation to utilize the full amount available under the Equity Purchase Agreement.

As discussed above, in addition to the shares to be issued pursuant to the Equity Purchase Agreement, we have issued to Premier $39,574 worth of our common stock, or 12,765,957 shares of our common stock as Initial Commitment Shares in connection with the Equity Purchase Agreement, which amount of shares represents 3.0 percent of $1,000,000 divided by the sum equal to the average of the daily VWAP of our common stock on the three most recent trading days immediately preceding March 11, 2014, multiplied by 75 percent and with such shares being duly authorized, validly issued, fully paid and nonassessable. “VWAP” means the volume weighted average price (the aggregate sales price of all trades of our common stock during a trading day divided by the total number of shares of our common stock traded during such trading day) of the our common stock during a trading day.

We filed with the SEC a current report on Form 8-K with respect to the Premier Equity Purchase Agreement on March 26, 2014.

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.

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.

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.

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.

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 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, $27,500 of the note remains unpaid. There have been no conversions of the note.

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, $60,000 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 initial Purchase Price was $27,500 of consideration upon execution of the Note Purchase Agreement and all supporting documentation. The sum of $25,000 was delivered to Mind Solutions, and $2,500 was retained by Iconic Holdings through an original issue discount for 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, $25,000 of the note remains unpaid. There have been no conversions of the note.

Copies of the Note Purchase Agreement and convertible note in favor of Iconic Holdings, LLC were filed as exhibits with the SEC.

Cash from Financing Activities

Net cash provided by financing activities was $435,397 during fiscal 2013. This included $425,345 from proceeds from convertible notes, $48,526 in proceeds from convertible notes to a related party and $38,474 in payments on convertible notes to a related party.

Net cash provided by financing activities was $159,135 during fiscal 2012. During the fiscal 2012 period we generated $10,000 from the sale of our common stock, $61,000 from officer contributions, $101,835 from notes to related parties, and paid $13,700 on notes to related parties. See “Item 5. Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities.”

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.