eomn_10q.htm

0001477932-18-003529.txt : 20180716 0001477932-18-003529.hdr.sgml : 20180716 20180716155831 ACCESSION NUMBER: 0001477932-18-003529 CONFORMED SUBMISSION TYPE: 10-Q PUBLIC DOCUMENT COUNT: 41 CONFORMED PERIOD OF REPORT: 20180531 FILED AS OF DATE: 20180716 DATE AS OF CHANGE: 20180716 FILER: COMPANY DATA: COMPANY CONFORMED NAME: Ethos Media Network, Inc. CENTRAL INDEX KEY: 0001585738 STANDARD INDUSTRIAL CLASSIFICATION: TELEVISION BROADCASTING STATIONS [4833] IRS NUMBER: 463390293 STATE OF INCORPORATION: FL FISCAL YEAR END: 0831 FILING VALUES: FORM TYPE: 10-Q SEC ACT: 1934 Act SEC FILE NUMBER: 000-55035 FILM NUMBER: 18954487 BUSINESS ADDRESS: STREET 1: 1500 NW 65TH AVENUE CITY: PLANTATION STATE: FL ZIP: 33313 BUSINESS PHONE: 954-370-9900 MAIL ADDRESS: STREET 1: 1500 NW 65TH AVENUE CITY: PLANTATION STATE: FL ZIP: 33313 FORMER COMPANY: FORMER CONFORMED NAME: Eye On Media Network, Inc. DATE OF NAME CHANGE: 20130903 10-Q 1 eomn_10q.htm FORM 10-Q eomn_10q.htm

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

x QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended May 31, 2018

¨ TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE EXCHANGE ACT

For the transition period from __________ to __________.

Commission file number 000-55035

ETHOS MEDIA NETWORK, INC.

(Exact Name of Registrant as specified in its charter)

Florida

46-3390293

(State or jurisdiction of Incorporation or organization)

(I.R.S Employer Identification No.)

1500 NW 65^th Avenue, Plantation, Florida

33313

(Address of principal executive offices)

(Zip Code)

Registrant’s telephone number, including area code 954-370-9900

Indicate by check mark whether the registrant (1) 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 requirements for the past 90 days. x Yes ¨ 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). x Yes ¨ No

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

Large accelerated filer	¨	Accelerated filer	¨
Non-accelerated filer	¨	Smaller Reporting Company	x
Emerging growth company	x

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

The number of shares of the issuer’s common stock, par value $.001 per share, outstanding as of July 13, 2018 was 146,993,149. There are fifty million (50,000,000) shares of the issuer’s Series A Convertible Preferred Stock issued and outstanding as of such date.

TABLE OF CONTENTS

		Page
Part I. Financial Information.

Item 1.	Condensed Consolidated Unaudited Financial Statements.	3

	Condensed Consolidated Balance Sheets for the periods ending May 31, 2018, unaudited, and August 31, 2017.	3

	Condensed Consolidated Statements of Operations for the three and nine months ended May 31, 2018 and 2017, unaudited.	4

	Condensed Consolidated Statements of Cash Flows for the nine months ended May 31, 2018 and 2017, unaudited.	5

	Notes to Condensed Consolidated Financial Statements, unaudited.	6

Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations.	15
Item 3.	Quantitative and Qualitative Disclosures About Market Risk.	20
Item 4.	Controls and Procedures.	20

Part II. Other Information.

Item 1.	Legal Proceedings.	22
Item 1A.	Risk Factors.	22
Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds.	22
Item 3.	Defaults Upon Senior Securities.	22
Item 4.	Mine Safety Disclosure.	22
Item 5.	Other Information.	23
Item 6.	Exhibits.	23
	Signatures.	25

Part I. Financial Information

Item 1. Condensed Financial Statements

Ethos Media Network, Inc. CONDENSED CONSOLIDATED BALANCE SHEETS

	May 31,			August 31,
	2018			2017
	(Unaudited)
ASSETS
Current Assets
Cash and cash equivalents	$	17,330		$	68,931
Note receivable		24,500			24,500
Total Current Assets		41,830			93,431

Property and equipment, net of accumulated
depreciation of $497,434 and $504,812, respectively		80,266			148,148

TOTAL ASSETS	$	122,096		$	241,579

LIABILITIES AND STOCKHOLDERS' EQUITY
Current Liabilities
Accounts payable	$	12,352		$	7,186
Accrued interest		---			9,345
Convertible note payable, net of discount
of $0 and $24,731, respectively		---			170,269
Derivative liabilities		---			1,633,576
Total Current Liabilities		12,352			1,820,376

TOTAL LIABILITIES		12,352			1,820,376

COMMITMENTS AND CONTINGENCIES - See Note 9

Stockholders' Equity/(Deficit)
Preferred stock: 750,000,000 authorized; $0.001 par value
50,000,000 and 50,000,000 shares issued and outstanding, respectively		50,000			50,000
Common stock: 900,000,000 authorized; $0.001 par value
146,993,149 and 28,789,451 shares issued and outstanding, respectively		146,993			28,789
Additional paid in capital		3,993,371			2,896,674
Accumulated deficit		(4,080,619	)		(4,554,260	)
Total Stockholders' Equity/(Deficit)		109,744			1,578,797

TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY/(DEFICIT)	$	122,096		$	241,579

The accompanying notes are an integral part of these condensed consolidated financial statements

3

Table of Contents

Ethos Media Network, Inc. CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (Unaudited)

	For the Three months Ended						For the Nine Months Ended
	May 31,						May 31,
	2018			2017			2018			2017

Revenues	$	1,500		$	11,300		$	3,150		$	32,375

Operating Expenses
Contractor costs		1,025			325			13,475			1,775
Stock for services		801,500			---			801,500			---
Professional fees		11,699			49,965			37,552			62,113
General and administrative		26,343			22,436			80,890			45,737
Impairment of long-lived assets		---			---			---			335,668
Depreciation and amortization		20,536			81,042			67,882			243,125
Total operating expenses		861,103			153,768			1,001,299			688,418

Net loss from operations		(859,603	)		(142,468	)		(998,149	)		(656,043	)

Other income (expense)
Interest expense		(11,224	)		(3,876	)		(20,620	)		(3,876	)
Gain on asset disposition		---			---			5,000			---
Interest expense related to derivative liability		---			(70,828	)		(58,341	)		(70,828	)
Change in derivative		225,198			(149,765	)		1,545,752			(149,765	)
Net income (loss)	$	(645,629	)	$	(366,937	)	$	473,642		$	(880,512	)

Basic income (loss) per share	$	(0.01	)	$	(0.01	)	$	0.01		$	(0.03	)

Diluted income (loss) per share	$	---		$	---		$	0.00		$	---

Weighted average number of shares outstanding		110,910,845			28,789,451			66,044,831			28,667,977
Diluted weighted average number of shares outstanding		---			---			566,044,831			---

The accompanying notes are an integral part of these condensed consolidated financial statements

4

Table of Contents

Ethos Media Network, Inc. CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited)

	For the Nine Months Ended
	May 31,			May 31,
	2018			2017
CASH FLOWS FROM OPERATING ACTIVITIES:
Net (loss)	$	473,642		$	(880,512	)
Adjustment to reconcile Net (loss) to net
cash used by operations:
Gain on asset disposition		(5,000	)		---
Depreciation and amortization		67,882			243,125
Beneficial conversion of derivative convertible debt		---			220,593
Change in fair market value of derivatives		(1,545,752	)		---
Amortization of debt discount		58,341			---
Stock issued for services provided		813,500			---
Impairment of long-lived assets		---			335,668
Change in assets and liabilities:
Accounts payable		5,166			(2,313	)
Accrued interest		10,306			3,876
Net Cash Used in Operating Activities		(121,915	)		(79,563	)

CASH FLOWS FROM INVESTING ACTIVITIES:
Sale of fixed asset		5,000			---
Intangible assets		---			(30,300	)
Net Cash provided by investing activities		5,000			(30,300	)

CASH FLOWS FROM FINANCING ACTIVITIES:
Proceeds from convertible notes		---			195,000
Repayment of convertible notes		(162,351	)		---
Proceeds from sale of common stock		227,665			12,500
Net Cash Provided by Financing Activities		65,314			207,500

Net increase (decrease) in cash and cash equivalents		(51,601	)		97,637
Cash and cash equivalents
Beginning of period		68,931			2,071
End of period	$	17,330		$	99,708
Supplemental cash flow information
Cash paid for interest	$	---		$	---
Cash paid for taxes	$	---		$	---
Non-cash transactions:
Debt/accrued interest converted into common stock	$	101,966		$	---
Original discount recorded on the recognition of notes with derivative liability	$	30,000		$	---
Extinguishment of the derivative liability related to debt conversions	$	64,301		$	---
Derivative convertible liability recorded	$	---		$	605,841

The accompanying notes are an integral part of these condensed consolidated financial statements

5

Table of Contents

ETHOS MEDIA NETWORK INC.

Notes to Condensed Consolidated Financial Statements

For the period ended May 31, 2018

(Unaudited)

NOTE 1 NATURE OF OPERATIONS AND PRINCIPLES OF CONSOLIDATION

Ethos Media Network, Inc. (“Ethos”, “EOMN” or the “Company”) was incorporated in Florida on August 2, 2013, with an objective to acquire, or merge with, an operating business. On January 22, 2014 the Company acquired an operating company, Eye on South Florida in a reverse merger.

Eye on South Florida, Inc. (ETHOS), a corporation, was chartered in the State of Florida on January 18, 2013 as a media organization for the purpose of providing television services as an independent producer and distributor of television programming locally and nationally. The programming is based on content that is produced and filmed in South Florida, on subjects that are relevant to the South Florida area. The operations of Eye on South Florida ceased in January of 2015.

As of January 22, 2014, the Company is in the business of providing television services to areas around the state and the country.

These financial statements include the balances of Ethos Media Network, Inc. and subsidiary. All intercompany balances have been eliminated in the financial statements.

NOTE 2: GOING CONCERN

The Company’s financial statements are prepared using accounting principles generally accepted in the United States of America applicable to a going concern, which contemplates the realization of assets and liquidation of liabilities in the normal course of business. The Company has not yet established an ongoing source of revenues sufficient to cover its operating cost and allow it to continue as a going concern. The Company has incurred substantial expenses from inception, requires outside funding, resulting in a large accumulated deficit. The ability of the Company to continue as a going concern is dependent on the Company obtaining adequate capital to fund operating losses until it becomes profitable. If the Company is unable to obtain adequate capital, it could be forced, to cease operations.

In order to continue as a going concern, the Company will need, among other things, additional capital resources. Management’s plan to obtain such resources for the Company include, obtaining capital from management and significant stockholders sufficient to meet its minimal operating expenses. However, management cannot provide any assurance that the Company will be successful in accomplishing any of its plans.

There is no assurance that the Company will be able to obtain sufficient additional funds when needed or that such funds, if available will be obtainable on terms satisfactory to the Company. In addition, profitability will ultimately depend upon the level of revenues received from business operations. However, there is no assurance that the Company will attain profitability. The accompanying financial statements do not include any adjustments that might be necessary if the Company is unable to continue as a going concern.

NOTE 3: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Unaudited Interim Financial Statements

The accompanying unaudited condensed financial statements have been prepared pursuant to the rules and regulations of the Securities and Exchange Commission for interim financial statements. Therefore, they do not include all of the information and footnotes required by accounting principles generally accepted in the United States for complete financial statements. The interim financial statements should be read in conjunction with the annual financial statements included in the Form 10-K as of August 31, 2017 and filed with the Securities and Exchange Commission on October 31, 2017.

In the opinion of management, all adjustments consisting of normal recurring entries necessary for a fair statement of the periods presented for: (a) the financial position; (b) the result of operations; and (c) cash flows, have been made in order to make the financial statements presented not misleading. The results of operations for such interim periods are not necessarily indicative of operations for a full year.

6

Table of Contents

ETHOS MEDIA NETWORK INC.

Notes to Condensed Consolidated Financial Statements

For the period ended May 31, 2018

(Unaudited)

Basis of Presentation and Use of Estimates

The Company prepares its financial statements in conformity with accounting principles generally accepted in the United States of America ("GAAP"), which require management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements, and reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates.

Fiscal Year End

The Company elected August 31 as its fiscal year ending date.

Cash and Cash Equivalents

The Company considers all highly liquid investments with an original maturity of six months or less at the date of acquisition to be cash equivalents. Cash and cash equivalents totaled $17,330 at May 31, 2018 and $68,931 at August 31, 2017.

Credit risk associated with cash deposits are insured under FDIC up to $250,000 per depositor, per FDIC insured bank, per ownership category. At such time, as the Company’s cash deposits exceed FDIC limits, the Company will reassess their credit risk.

Cash Flows Reporting

The Company follows ASC 230, Statement of Cash Flows, 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 ASC 230, Statement of Cash Flows, 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

Financial Instruments

The Company’s balance sheet includes certain financial instruments, including cash and accounts payable. The carrying amounts of current assets and current liabilities approximate their fair value because of the relatively short period of time between the origination of these instruments and their expected realization.

7

Table of Contents

ETHOS MEDIA NETWORK INC.

Notes to Condensed Consolidated Financial Statements

For the period ended May 31, 2018

(Unaudited)

ASC 820, Fair Value Measurements and Disclosures, defines fair value as the exchange price that would be received for an asset or paid to transfer a liability (an exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date. ASC 820 also establishes a fair value hierarchy that distinguishes between (1) market participant assumptions developed based on market data obtained from independent sources (observable inputs) and (2) an entity’s own assumptions about market participant assumptions developed based on the best information available in the circumstances (unobservable inputs). The fair value hierarchy consists of three broad levels, which gives the highest priority to unadjusted quoted prices in active markets for identical assets or liabilities (Level 1) and the lowest priority to unobservable inputs (Level 3). The three levels of the fair value hierarchy are described below:

Level 1

Unadjusted quoted prices in active markets that are accessible at the measurement date for identical, unrestricted assets or liabilities.

Level 2

Inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly or indirectly, including quoted prices for similar assets or liabilities in active markets; quoted prices for identical or similar assets or liabilities in markets that are not active; inputs other than quoted prices that are observable for the asset or liability (e.g., interest rates); and inputs that are derived principally from or corroborated by observable market data by correlation or other means.

Level 3

Inputs that are both significant to the fair value measurement and unobservable.

Fair value estimates discussed herein are based upon certain market assumptions and pertinent information available to management as of May 31, 2018. The respective carrying value of certain on-balance-sheet financial instruments approximated their fair values due to the short-term nature of these instruments.

Revenue Recognition

The Company recognizes revenue when it is realized or realizable and earned.

The Company considers revenue realized or realizable and earned when all of the following criteria are met:

o persuasive evidence of an arrangement exists

o the product has been shipped or the services have been rendered to the customer

o the sales price is fixed or determinable

o collectability is reasonably assured.

The Company generates revenue through four processes: (1) Media Production, (2) Commercial Production, Distribution and (3) Advertising Sales and Distribution (4) Live Broadcasting of Events.

· Revenue for media production of original content. The company recognizes a sale when the production is completed and ready for distribution. The burden of distribution and risk of loss has passed to the customer.

· Revenue for production of television grade HD Commercials. Revenue is recognized when the services have been performed and passed on to the customer.

· Revenue for distribution of commercials and content service fees is recognized ratably over the term of the advertising agreement.

· Revenue for live broadcasting of original content. The company recognizes a sale when the live broadcast / production is contracted and completed. The burden of distribution and risk of loss has passed to the customer.

Property and Equipment

Property and equipment is stated at cost. Depreciation is computed by the straight-line method over estimated useful lives.

Long-lived assets such as property, equipment and identifiable intangibles are reviewed for impairment at least annually or whenever facts and circumstances indicate that the carrying value may not be recoverable. When required, impairment losses on assets to be held and used are recognized based on the fair value of the asset. The fair value is determined based on estimates of future cash flows, market value of similar assets, if available, or independent appraisals, if required. If the carrying amount of the long-lived asset is not recoverable, an impairment loss is recognized for the difference between the carrying amount and fair value of the asset. The Company recognized impairment losses of $0 and $495,241 for the periods ending May 31, 2018 and August 31, 2017, respectively.

8

Table of Contents

ETHOS MEDIA NETWORK INC.

Notes to Condensed Consolidated Financial Statements

For the period ended May 31, 2018

(Unaudited)

Impairment of Long- Lived Assets

The Company reviews and evaluates long-lived assets for impairment when events or changes in circumstances indicate that the related carrying amounts may not be recoverable. The assets are subject to impairment consideration under FASB ASC 360-10-35-17 if events or circumstances indicate that their carrying amount might not be recoverable. When the Company determines that an impairment analysis should be done, the analysis will be performed using the rules of FASB ASC 930-360-35, Asset Impairment, and 360-0 through 15-5, Impairment or Disposal of Long- Lived Assets.

Deferred Income Taxes and Valuation Allowance

The Company accounts for income taxes under ASC 740, Income Taxes. Under the asset and liability method of ASC 740, deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial statements carrying amounts of existing assets and liabilities and their respective tax bases. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period the enactment occurs. A valuation allowance is provided for certain deferred tax assets if it is more likely than not that the Company will not realize tax assets through future operations. No deferred tax assets or liabilities were recognized as of May 31, 2018.

Net Income (Loss) Per Common Share

Net income (loss) per share is calculated in accordance with ASC 260, “Earnings Per Share.” The weighted-average number of common shares outstanding during each period is used to compute basic earning or loss per share. Diluted earnings or loss per share is computed using the weighted average number of shares and diluted potential common shares outstanding. Dilutive potential common shares are additional common shares assumed to be exercised. Total dilutive common shares at May 31, 2018 were 566,044,831 which consist of 66,044,831 weighted average number of common shares outstanding and 500,000,000 shares for Series A Convertible Preferred Stock. The Series A Convertible Preferred Stock converts at a rate of 10 common shares per each share of preferred for a total of 500,000,000 shares of common debt. Total diluted common shares at May 31, 2017 were 0.

Basic (loss) income per share is computed by dividing income available to common stockholders by the weighted average number of shares of common stock outstanding for the period. Diluted (loss) income per share reflects the potential dilution that could occur if securities or other contracts to issue common stock were exercised or converted into common stock or resulted in the issuance of common stock that then shared in the income of the Company.

Share-Based Expense

ASC 718, Compensation – Stock Compensation, prescribes accounting and reporting standards for all share-based payment transactions in which employee services are acquired. Transactions include incurring liabilities, or issuing or offering to issue shares, options, and other equity instruments such as employee stock ownership plans and stock appreciation rights. Share-based payments to employees, including grants of employee stock options, are recognized as compensation expense in the financial statements based on their fair values. That expense is recognized over the period during which an employee is required to provide services in exchange for the award, known as the requisite service period (usually the vesting period).

The Company accounts for stock-based compensation issued to non-employees and consultants in accordance with the provisions of ASC 505-50, Equity – Based Payments to Non-Employees. Measurement of share-based payment transactions with non-employees is based on the fair value of whichever is more reliably measurable:(a) the goods or services received; or (b) the equity instruments issued. The fair value of the share-based payment transaction is determined at the earlier of performance commitment date or performance completion date.

Share-based expense for the nine months ended May 31, 2018 and 2017 was $801,500 and $0 respectively. This consists of services rendered.

9

Table of Contents

ETHOS MEDIA NETWORK INC.

Notes to Condensed Consolidated Financial Statements

For the period ended May 31, 2018

(Unaudited)

Recent Accounting Pronouncements

From time to time, new accounting pronouncements are issued that we adopt as of the specified effective date. We believe that the impact of recently issued standards that are not yet effective may have an impact on our results of operations and financial statements.

In February 2016, the FASB issued ASU No. 2016-02, Leases, which is intended to improve financial reporting on leasing transactions. This standard requires a lessee to record on the balance sheet the assets and liabilities for the rights and obligations created by lease terms of more than 12 months. This standard will be effective for the Company on September 1, 2019. The Company is currently evaluating the impact the adoption of this ASU will have on its consolidated financial statements.

ASU Update 2014-09 Revenue from Contracts with Customers (Topic 606) issued May 28, 2014 by FASB and IASB converged guidance on recognizing revenue in contracts with customers on an effective date for years beginning on or after December 31, 2017 will be evaluated as to impact and implemented accordingly.

NOTE 4: PROPERTY, PLANT AND EQUIPMENT

The Company has capitalized costs for property, plant and equipment as follows:

	May 31, 2018		August 31, 2017
Production equipment	$	535,480	$	535,480
Office furniture and equipment		7,899		7,899
Leasehold improvements		34,321		34,321
Vehicle		---		75,260
		577,700		652,960
Accumulated depreciation		497,434		504,812
PP&E, net accumulated depreciation	$	80,266	$	148,148

During the nine months ended May 31, 2018, the Company sold its vehicle for $5,000. The vehicle’s book value at the time of sale was $0 resulting in a gain on sale of $5,000.

Depreciation for the nine months ended May 31, 2018 and 2017 was $67,882, and $162,083, respectively.

Impairment of long-lived assets

The Company had tested the four asset groups and determined that impairment indicators were present for the production equipment group, specifically for software, server and vehicle components. As a result, software, server and vehicle were written down to their estimated fair value of $241,656, $97,758 and $55,301, respectively; resulting in an impairment charge of $495,241 for the period ending August 31, 2017. Impairment for the nine months ended May 31, 2018 was $0.

NOTE 5: ACCOUNTS PAYABLE

At May 31, 2018 and August 31, 2017, accounts payable was $12,352 and $7,186, respectively.

10

Table of Contents

ETHOS MEDIA NETWORK INC.

Notes to Condensed Consolidated Financial Statements

For the period ended May 31, 2018

(Unaudited)

NOTE 6 – CONVERTIBLE NOTE PAYABLE

AUCTUS FUND, LLC

On March 22, 2017, the Company executed a convertible promissory note with Auctus Fund, LLC. The note carries a principal balance of $80,000 together with an interest rate of twelve percent (12%) per annum and a maturity date of December 22, 2017. All payments due hereunder (to the extent not converted into common stock, $0.001 par value per share in accordance with the terms of the note agreement shall be made in lawful money of the United States of America. Any amount of principal or interest on this Note which is not paid when due shall bear interest at the rate of twenty-four percent (24%) per annum from the due date thereof until the same is paid. As of May 31, 2018, the principal balance of $80,000 has been paid in full along with all accrued interest.

The holder shall have the right from time to time, and at any time during the period beginning on the date which is one hundred eighty-one (181) days following the date of this note, to convert all or any part of the outstanding and unpaid principal amount into Common Stock. The conversion shall equal sixty-one percent (61%) of the average of the lowest two (2) trading prices for the Common Stock during the previous twenty-five (25) trading period ending on the latest complete trading day prior to the conversion date, representing a discount rate of forty-five percent (45%).

EMA FINANCIAL, LLC

On March 22, 2017, the Company executed a convertible promissory note with EMA Financial, LLC. The note carries a principal balance of $85,000 together with an interest rate of ten percent (10%) per annum and a maturity date of March 22, 2018. All payments due hereunder (to the extent not converted into common stock, $0.001 par value per share in accordance with the terms of the note agreement shall be made in lawful money of the United States of America. Any amount of principal or interest on this Note which is not paid when due shall bear interest at the rate of twenty-four percent (24%) per annum from the due date thereof until the same is paid. As of May 31, 2018, the principal balance of $85,000 has been paid in full along with all accrued interest.

The holder shall have the right, in its sole and absolute discretion, at any time from time to time, to convert all or any part of the outstanding amount due under this note. The conversion shall equal sixty percent (60%) of the average of the lowest two (2) trading prices for the Common Stock during the previous twenty (20) trading period ending on the latest complete trading day prior to the conversion date, representing a discount rate of forty percent (40%).

POWER UP LENDING GROUP

On April 20, 2017, The Company executed a convertible promissory note with Power Up Lending Group, Ltd. The note carries a principal balance of $30,000 together with an interest rate of twelve percent (12%) per annum and a maturity date of January 30, 2018. All payments due hereunder (to the extent not converted into common stock, $0.001 par value per share in accordance with the terms of the note agreement shall be made in lawful money of the United States of America. Any amount of principal or interest on this Note which is not paid when due shall bear interest at the rate of twenty two percent (22%) per annum from the due date thereof until the same is paid. As of May 31, 2018, the principal balance of $30,000 has been paid in full along with all accrued interest.

The holder shall have the right from time to time, and at any time during the period beginning on the date which is one hundred eighty (180) days following the date of this note, to convert all or any part of the outstanding and unpaid principal amount into Common Stock. The conversion shall equal fifty-five percent (55%) of the average of the lowest two (2) trading prices for the Common Stock during the twenty (20) day trading period ending on the latest complete trading day prior to the conversion date, representing a discount rate of forty-five percent (45%).

11

Table of Contents

ETHOS MEDIA NETWORK INC.

Notes to Condensed Consolidated Financial Statements

For the period ended May 31, 2018

(Unaudited)

TOUCHE INVESTMENTS, LLC

On March 28, 2018, the company executed an amendment to the convertible note payable issued on March 22, 2017 to Power Up Lending, a/k/a Jabro Funding Corp with Touche Investments, LLC. The amendment waives the default conditions under Section 3.1 of the note and agrees to extinguish the outstanding balance together with principal and interest of $37,664.55 with the delivery of 15,066,000 shares of common stock at $0.0025 per share. The original convertible promissory note carries a principal balance of $30,000 together with an interest rate of twelve percent (12%) per annum and a maturity date of January 30, 2018. All payments due hereunder (to the extent not converted into common stock, $0.001 par value per share in accordance with the terms of the note agreement shall be made in lawful money of the United States of America. Upon delivery of the shares the Note will be deemed paid in full. As of May 31, 2018, the principal balance of $37,665 has been paid in full.

The Company accounts for this embedded conversion feature as a derivative under ASC 815-10-15-83 and valued separately from the note at fair value. The embedded conversion feature of the note is revalued at each subsequent reporting date at fair value and any changes in fair value will result in a gain or loss in those periods. At May 31, 2018, the derivative liability associated with Auctus Fund, LLC was $0; EMA Financial, LLC was $0, Power up lending was $0 and Touche Investments was $0.

Convertible Notes payable consisted of the following:

	May 31, 2018		August 31, 2017
Convertible notes payable:	$	---	$	195,000
Debt discount		---		(24,731	)
Convertible notes payable net of debt discount	$	---	$	170,269

Accrued interest		---		9,345

Current portion of convertible note payable and interest	$	---	$	179,614

NOTE 7: EQUITY

Preferred Stock

The Company has been authorized to issue 750,000,000 shares of $0.001 par value Preferred Stock. The Board of Directors is expressly vested with the authority to divide any or all of the Preferred Stock into series and to fix and determine the relative rights and preferences of the shares of each series so established, within certain guidelines established in the Articles of Incorporation. At May 31, 2018 and August 31, 2017 there are 50,000,000 and 50,000,000 shares of Series “A” Convertible Preferred Stock issued and outstanding, respectively. The Series A Convertible Preferred Stock converts at a rate of 10 common shares per each share of preferred for a total of 500,000,000 shares of common.

Common Stock

The Company has been authorized to issue 900,000,000 shares of common stock, $0.001 par value. Each share of issued and outstanding common stock shall entitle the holder thereof to fully participate in all shareholder meetings, to cast one vote on each matter with respect to which shareholders have the right to vote, and to share ratably in all dividends and other distributions declared and paid with respect to common stock, as well as in the net assets of the corporation upon liquidation or dissolution.

12

Table of Contents

ETHOS MEDIA NETWORK INC.

Notes to Condensed Consolidated Financial Statements

For the period ended May 31, 2018

(Unaudited)

On January 27, 2017, the Company sold 62,500 shares of common stock to a non-related party in exchange for cash proceeds of $2,500. The shares were issued at $0.04 per share.

On February 6, 2017, the Company sold 150,000 shares of common stock to a non-related party in exchange for cash proceeds of $10,000. The shares were issued at $0.066 per share.

On January 25, 2018, the Company sold 1,923,000 shares of common stock to a non-related party in exchange for cash proceeds of $10,000. The shares were issued at $0.0052 per share.

During the nine months ended May 31, 2018, the Company issued 18,260,000 shares of common stock to EMA Financial, LLC in exchange for principal reduction of $30,058 and accrued interest and fees of $9,825 for a total of $39,883. The shares were issued on various dates during the nine months ended May 31, 2018. The shares were issued at a discount to the fair market value, per the conversion agreement dated March 22, 2017.

During the nine months ended May 31, 2018, the Company issued 11,954,700 shares of common stock to Auctus Fund, LLC. in exchange for principal reduction of $12,630 and accrued interest and fees of $11,789 for a total of $24,419. The shares were issued on various dates during the nine months ended May 31, 2018. The shares were issued at a discount to the fair market value, per the conversion agreement dated March 22, 2017.

On March 15, 2018, the Company sold 7,999,998 shares of common stock to non-related parties in exchange for cash proceeds of $40,000. The shares were issued at $0.005 per share.

On March 18, 2018, the Company sold 500,000 shares of common stock to a non-related party in exchange for cash proceeds of $2,500. The shares were issued at $0.005 per share.

On March 19, 2018, the Company sold 750,000 shares of common stock to a non-related party in exchange for cash proceeds of $3,750. The shares were issued at $0.005 per share.

On March 20, 2018, the Company sold 4,750,000 shares of common stock to non-related parties in exchange for cash proceeds of $23,750. The shares were issued at $0.005 per share.

On March 28, 2018, the Company sold 14,000,000 shares of common stock to non-related parties in exchange for cash proceeds of $70,000. The shares were issued at $0.005 per share.

On March 28, 2018, the Company issued 15,066,000 shares of common stock to non-related parties in exchange for cancellation of the Touche Investment LLC, convertible note payable in the amount of $37,665. The shares were issued at a price of $0.0025 per share.

On April 3, 2018, the Company issued 5,000,000 shares of common stock to non-related parties in exchange for services rendered of $114,500. The shares were issued at FMV of $0.0229 per share.

On April 27, 2018, the Company issued 15,000,000 shares of common stock to a non-related party in exchange for services rendered of $343,500. The shares were issued at FMV of $0.0229 per share.

On April 27, 2018, the Company issued 15,000,000 shares of common stock to our CEO, Jack Namer, a related party in exchange for services rendered of $343,500. The shares were issued at FMV of $0.0229 per share.

On April 27, 2018, the Company sold 8,000,000 shares of common stock to non-related parties in exchange for cash proceeds of $40,000. The shares were issued at an average price of $0.005 per share.

As of May 31, 2018, there are 146,993,149 shares of common stock issued and outstanding.

Options and Warrants

There are no warrants or options outstanding to acquire any additional shares of common stock of the Company as of May 31, 2018.

13

Table of Contents

ETHOS MEDIA NETWORK INC.

Notes to Condensed Consolidated Financial Statements

For the period ended May 31, 2018

(Unaudited)

NOTE 8: RELATED PARTY TRANSACTION

The Company has been provided office space by a member of the Board of Directors at no cost. The management determined that such cost is nominal and did not recognize the rent expense in its financial statements.

The above amount is not necessarily indicative of the amount that would have been incurred had a comparable transaction been entered into with independent parties.

NOTE 9: COMMITMENTS AND CONTINGENCIES

From time to time the Company may be a party to litigation matters involving claims against the Company. Management believes that there are no current matters that would have a material effect on the Company’s financial position or results of operations.

NOTE 10: SUBSEQUENT EVENTS

Management has evaluated subsequent events through the date the financial statements were available to be issued, considered to be the date of filing with the Securities and Exchange Commission. Based on our evaluation no events have occurred in addition to those stated that require adjustment to or disclosure in the financial statements.

14

Table of Contents

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

Note Regarding Forward Looking Statements.

This quarterly report on Form 10-Q of Ethos Media Network, Inc. for the period ended May 31, 2018 contains certain forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended (the “Securities Act”), and Section 21E of the Securities Exchange Act of 1934, as amended (“Exchange Act”), which are intended to be covered by the safe harbors created thereby. To the extent that such statements are not recitations of historical fact, such statements constitute forward-looking statements which, by definition, involve risks and uncertainties. In particular, statements under the Sections: Description of Business, Management's Discussion and Analysis of Financial Condition and Results of Operations contain forward-looking statements. Where, in any forward-looking statement, the Company expresses an expectation or belief as to future results or events, such expectation or belief is expressed in good faith and believed to have a reasonable basis, but there can be no assurance that the statement of expectation or belief will result or be achieved or accomplished.

The following are factors that could cause actual results or events to differ materially from those anticipated, and include but are not limited to: general economic, financial and business conditions; changes in and compliance with governmental regulations; changes in tax laws; and the costs and effects of legal proceedings.

You should not rely on forward-looking statements in this quarterly report. This quarterly report contains forward-looking statements that involve risks and uncertainties. We use words such as “anticipates,” “believes,” “plans,” “expects,” “future,” “intends,” and similar expressions to identify these forward-looking statements. Prospective investors should not place undue reliance on these forward-looking statements, which apply only as of the date of this report. Our actual results could differ materially from those anticipated in these forward-looking statements for many reasons, including the risks faced by Ethos Media Network, Inc. Financial information provided in this Form 10-Q, for periods subsequent to August 31, 2017, is preliminary and remains subject to audit. As such, this information is not final or complete, and remains subject to change, possibly materially.

Our Business Overview.

Ethos Media Network, Inc. (“Ethos”, “EOMN” or the “Company”) is a company that was incorporated in the State of Florida on August 2, 2013. The Company selected August 31 as its fiscal year end. We are a reporting company and file all reports required under sections 13 and 15d of the Securities Exchange Act of 1934. As of January 22, 2014, the Company is in the business of providing television services to areas around the state and the country.

Implications of Being an Emerging Growth Company

We qualify as an emerging growth company as that term is used in the Jumpstart Our Business Startups Act. An emerging growth company may take advantage of specified reduced reporting and other burdens that are otherwise applicable generally to public companies. These provisions included:

15

Table of Contents

(i) A requirement to have only two years of audited financial statements and only two years of related Management Discussion & Analysis disclosures;

(ii) Exemption from the auditor attestation requirement in the assessment of the emerging growth company’s internal control over financial reporting under Section 404 of the Sarbanes-Oxley Act of 2002;

(iii) Reduced disclosure about the emerging growth company’s executive compensation arrangements; and

(iv) No non-binding advisory votes on executive compensation or golden parachute arrangements.

We have already taken advantage of these reduced reporting burdens, which are also available to us as a smaller reporting company as defined under Rule 12b-2of the Securities Exchange Act of 1934, as amended (the “Exchange Act”).

In addition, Section 107 of the JOBS Act also provides that an emerging growth company can take advantage of the extended transition period provided in Section 7(a)(2)(B) of the Securities Act of 1933, as amended (the “Securities Act”) for complying with new or revised accounting standards. We are choosing to utilize the extended transition period for complying with new or revised accounting standards under Section 102(b)(2) of the JOBS Act. This election allows our Company to delay the adoption of new or revised accounting standards that have different effective dates for public and private companies until those standards apply to private companies. As a result of this election, our financial statements may not be comparable to companies that comply with public company effective dates.

We could remain an emerging growth company for up to five years, or until the earliest of (i) the last day of the first fiscal year in which our annual gross revenues exceed $1 billion, (ii) the date that we become a “large accelerated filer” as defined in Rule 12b-2 under the Exchange Act, which would occur if the market value of our common stock that is held by non-affiliates exceeds $700 million as of the last business day of our most recently completed second fiscal quarter, or (iii) which issued more than $1 billion in non-convertible debt during the preceding three-year period.

Business of Issuer

Ethos Media Network, Inc. (“Ethos”, “EOMN” or the “Company”) was incorporated in Florida on August 2, 2013. The Company is actively engaged in the acquisition, development, production and distribution of television and multi-media programming content.

The Company is generating revenue from banner advertisements on our website (www.ethosmeidanetwork.com), commercial productions, event planners, corporate videos, infomercials, public announcements, pay-per-view live broadcasted transmissions and advertisers, desiring to promote their productions, events and brands alongside the various distribution mediums. In addition, the Company is generating revenue from other production companies and/or television networks that request on-site filming and/or our original feeds with the use of our communication technology and equipment. Ethos has been assisting and providing valuable airtime pro-bono to non-profit organizations with sponsored ads, in order to promote their fund-raising events for important causes in the community. Some of our clients currently include Hard Rock Hotel & Casino, AutoNation, Florida Metro Rail, Fort Lauderdale Chamber of Commerce, Shino Bay Dermatology, DelVecchio Pizza and Universal Insurance.

The Company is distributing its content thru the available delivery companies listed below: These statistics are available on Wikipedia and Nielsen ratings.

16

Table of Contents

a. COMCAST: the largest cable television company in the United States with over 22 million subscribers.

b. DIRECT TV, LLC: with over 35 million subscribers.

c. DISH TV: with over 13 million subscribers.

d. Roku network: with over 5 million subscribers.

These distribution delivery companies do not include the international markets of China, South America and Africa, which we intend to target for additional distribution of our content.

Ethos Media Network, Inc. is a fully operational television network appearing over the air on Channel 16 Florida and widely viewed on the internet and all mobile devices. The viewing area of Channel 16 extends from Vero Beach, Florida through West Palm Beach, Fort Lauderdale, Miami to Key West and west Martin County Florida which comprises approximately 2,800,000 households. We also distribute streaming content separately on the internet through our website www.channel16live.com. We currently distribute our news and event coverage content to DIRECTV, DISH TV and the Roku network. There is no written agreement with Comcast. As is customary in the industry, our content is sold through a media broker to the above networks. Our independent media buyer/broker is IHN Media Services, LLC of San Antonio, Texas. We have no ownership interest in such company. The agreement for services with IHN Media Services, LLC is verbal. The material terms are that certain services in connection with Company's planning, preparing and placing of advertising for the Company as follows:

a. Analyze present and potential television marketing and advertising opportunities; and

b. Provide television advertising on all cable carries including, but not limited to, Time Warner, Comcast, Cox, Verizon FIOS, Bright House Cable, Sudden Link, Grande, WOW Cable) with such services to include all broadcast stations as well as all ad-supported cable networks and syndicated programming; and

c. Provide all of its services at fair and competitive rates in markets both locally and nationally; and

d. Negotiate for appropriate weekly/monthly media schedules at the lowest possible media costs for the Company’s advertising purposes; and.

e. Provide Company with written schedules of all media time placements made for the Client indicating the national and local media that is selected, and the dates, days, times, and costs of that media. Company will be given the opportunity to approve all advertising schedules for placement by Agency; and

f. Agency will provide the Company with weekly, monthly, or flight invoices for the gross amount of media time that is purchased for the Client’s advertising purposes; and

g. Identify and procure clients for Company that seek advertising on its or other media networks and seek commercials that Company can produce for them for a fee.

The Company will pay the Agency for its services on a monthly basis. Amounts paid for the Agency’s services will vary from region to region where the Company’s content is distributed.

For a thorough listing of the types of television content we produce visit our website at www.eyeonmedianetwork.com. Selected examples of the types of products and services we provide include:

· Creation of television news and event coverage content for several charities including non-profit Children’s Diagnostic & Treatment Center in Ft. Lauderdale, Florida, non-profit Go Riverwalk Fort Lauderdale, non-profit Guardian Behavioral Health Foundation in Ft. Lauderdale, Florida, non-profit Seafarer’s House in Ft. Lauderdale, Florida and, non-profit Unicorn Children’s Foundation in Boca Raton, Florida; and

· Creation of commercials for various types of businesses including, for example, attorneys, doctors, dermatologists and motor vehicle dealerships.

The Bunji™ Product

The Company recently announced the availability of Bunji™, a new media platform that changes the way rich media content is delivered. Bunji™ is a 24/7 personalized media engine that allows companies, organizations, film festivals, entertainers, individuals — anyone — the opportunity to have a self-branded online digital media and broadcasting presence with their own customized marketing and promotion channel.

Bunji™ is a turnkey, customizable and branded media platform that allows anyone to have their own marketing and promotion channel. It eliminates media industry gatekeepers. A prospective user’s own original content, supplemented with Ethos Media Network’s substantial library of material, creates a robust presence for any company, organization or individual. And because it’s ad-based, using the Bunji™ platform has the potential to enhance an organization’s revenue.

For a small monthly fee, Bunji™ allows users to establish their own channel — available publicly or as an in-house product, that has the ability to livestream content, upload video and music, sync all social media content and/or download content from multiple media libraries to curate their channel to their specific audience. Users can also schedule delivery of content quickly and easily.

Our research underscores the steady trend that internet TV viewing is dramatically rising; particularly among young people. The Bunji™ platform aggregates all types of media in one expandable platform, so users won’t need to look elsewhere for content. Bunji™ also provides the added benefit of earning revenue for original content creation and audience growth. In addition, these multi-level marketing opportunities will be targeted to both local and national audiences. With more than 180 million households and the backing of Ethos Media network, Bunji™ gives potential advertisers the trust and confidence of an established company and proof of distribution.

17

Table of Contents

Plan of Operation

Our plan of operation for the next twelve months will be to expand our client base. As we continue to grow we will need to raise additional funds. We do anticipate obtaining additional financing to fund operations through common stock offerings, to the extent available, or to obtain additional financing to the extent necessary to augment our working capital. We intend to continue to use the income from our current clients to continue to meet our operating expenses. We do not have need for the purchase of any property or equipment at this time. We will not have any significant changes in the current number of employees.

Our director has verbally agreed to continue to fund our operations as needed over the next 12 months until cash flows are sufficient to sustain operations. Our Plan of Operation for the next twelve months is to raise capital to continue to expand our operations. Although we are not presently engaged in any capital raising activities, we anticipate that we may engage in one or more private offering of our company’s securities. We would most likely rely upon the transaction exemptions from registration provided by Regulation D, Rule 506 or conduct another private offering under Section 4(2) of the Securities Act of 1933. See “Note 2 – Going Concern” in our financial statements for additional information as to the possibility that we may not be able to continue as a “going concern.”

While a strategic and wisely executed marketing campaign is key to expanding our customer base; providing new, cutting-edge, innovative strategies developed and implemented for our clients, will provide a solid platform upon which our operations will continue to grow and deliver long-term success. There is no guarantee that we will be able to fund the Company’s expenses out of operations. In that case our CEO has agreed to fund the projects. We also will most likely rely upon the transaction exemptions from registration provided by Regulation D, Rule 506 or conduct another private offering under Section 4(2) of the Securities Act of 1933.

Results of Operations for the three months ended May 31, 2018 and 2017

Revenues.

Total Revenue. Total revenues for the three months ended May 31, 2018 and 2017 were $1,500 and $11,300, respectively. Revenues were the results of operations. This decrease was due to the size and scope of the media events during the period.

Expenses.

Total Operating Expenses. Total operating expenses for the three months ended May 31, 2018 and 2017 were $861,103 and $153,768, respectively. Total operating expenses included contractor costs of $1,025 and $325, respectively; stock for services of $801,500 and $0, respectively; professional fees of $11,699 and $49,965, respectively; general and administrative of $26,343 and $22,436, respectively, impairment of long-lived assets of $0 and $0, respectively and depreciation and amortization of $20,536 and $81,042, respectively. Contractor cost increased by approximately 215%. The primary reason for the increase was due to an increase in the number of media events. Stock for services increased by approximately 100%. This increase was due to stock being issued for services rendered. Professional fees decreased by approximately 77%. This decrease is directly related to operations. General and administrative fees increased by approximately 17%. This increase is the result of production cost directly related to operations. Depreciation and amortization decreased by approximately 75%. This decrease was due to the disposition of an asset during the period.

Other Income (Expenses). Other income (expenses) for the nine months ended May 31, 2018 and 2017 included interest expense of ($11,224) and ($3,876), respectively; interest expense related to derivative liability of $0 and ($70,828), respectively and change in derivative of $225,198 and ($149,765), respectively. Other income (expense) changed by approximately 204% due to the convertible debt financing and its associated derivative liability calculated using the Black Scholes model.

18

Table of Contents

Results of Operations for the nine months ended May 31, 2018 and 2017

Revenues.

Total Revenue. Total revenues for the nine months ended May 31, 2018 and 2017 were $3,150 and $32,375, respectively. Revenues were the results of operations. This decrease was due to the size and scope of the media events during the period.

Expenses.

Total Operating Expenses. Total operating expenses for the nine months ended May 31, 2018 and 2017 were $1,001,299 and $688,418, respectively. Total operating expenses included contractor costs of $13,475 and $1,775, respectively; stock for services of $801,500 and $0, respectively; professional fees of $37,552 and $62,113, respectively; general and administrative of $80,890 and $45,737, respectively, impairment of long-lived assets of $0 and $335,668, respectively and depreciation and amortization of $67,882 and $243,125, respectively. Contractor cost increased by approximately 659%. The primary reason for the increase was due to an increase in the number of media events. Stock for services increased by approximately 100%. The primary reason was the issuance of stock for services rendered. Professional fees decreased by approximately 40%. This decrease is directly related to operations. Impairment of long-lived assets decreased by approximately 100%. This decrease is the result of the Company not impairing any assets during the period. General and administrative fees increased by approximately 77%. This increase is the result of production cost directly related to operations. Depreciation and amortization decreased by approximately 72%. This decrease was due to the disposition of an asset during the period.

Other Income (Expenses). Other income (expenses) for the nine months ended May 31, 2018 and 2017 included interest expense of ($20,620) and ($3,876), respectively; interest expense related to derivative liability of ($58,341) and ($70,828), respectively and change in derivative of $1,545,752 and ($149,765) respectively. Gain on asset disposition of $5,000 and $0, respectively. Other income (expense) changed by approximately 115% due to the convertible debt financing and its associated derivative liability calculated using the Black Scholes model.

Financial Condition.

Total Assets. Total assets at May 31, 2018 and August 31, 2017 were $122,096 and $241,579, respectively. Total assets consist of cash of $17,330 and $68,931, respectively; note receivable of $24,500 and $0, respectively and property and equipment, net of depreciation and impairment in the amount of $80,266 and $148,148, respectively.

Total Liabilities. Total liabilities at May 31, 2018 and August 31, 2017 were $12,352 and $1,820,376, respectively. Total liabilities consist of accounts payable of $12,352 and $7,186, respectively; accrued interest of $0 and $9,345 respectively; convertible note payable, net of discount was $0 and $170,269, respectively and derivative liability of $0 and $1,633,576, respectively. .

Liquidity and Capital Resources.

The accompanying financial statements have been prepared assuming that the Company will continue as a going concern which contemplates, among other things, the realization of assets and satisfaction of liabilities in the ordinary course of business.

The Company had net income for the nine months ended May 31, 2018 of $473,642 as compared to the loss for the nine months ended May 31, 2017 of $880,512. In addition, the Company has an accumulated deficit of $4,080,619 at May 31, 2018. Because of the absence of positive cash flows from operations, the Company will require additional funding for continuing the development and marketing of products. These factors raise substantial doubt about the Company’s ability to continue as a going concern. The accompanying financial statements do not include any adjustments that might result from the outcome of this uncertainty.

19

Table of Contents

We are presently able to meet our obligations as they come due. At May 31, 2018, we had working capital of $29,478. Our working capital is due to operations.

Net cash used in operating activities for the nine months ended May 31, 2018 and 2017 was ($121,915) and ($79,563), respectively. Net cash used in operating activities is our net income, less depreciation and amortization, impairment of long-lived assets, stock for services, beneficial conversion of derivative convertible note and further adjusted by increases and decreases in certain assets and liabilities. Cash for operating activities was provided by operating activities.

Net cash provided by investing activities for the nine months ended May 31, 2018 and 2017 was $5,000 and ($30,300), respectively. Net cash provided by investing activities included intangible assets and proceeds from the sale of fixed assets.

Net cash provided by financing activities for the nine months ended May 31, 2018 and 2017 was $65,314 and $207,500, respectively. Net cash provided by financing activities included proceeds from convertible notes, repayment of convertible notes and proceeds from the sale of common stock.

We anticipate that our future liquidity requirements will arise from the need to fund our growth from operations, pay current obligations and future capital expenditures. The primary sources of funding for such requirements are expected to be cash generated from operations and raising additional funds from the private sources and/or debt financing. However, we can provide no assurances that we will be able to generate sufficient cash flow from operations and/or obtain additional financing on terms satisfactory to us, if at all, to remain a going concern. Our continuation as a going concern is dependent upon our ability to generate sufficient cash flow to meet our obligations on a timely basis and ultimately to attain profitability. Our Plan of Operation for the next twelve months is to raise capital to continue to expand our operations and to seek merger candidates and/or acquisitions. Although we are not presently engaged in any capital raising activities, we anticipate that we may engage in one or more private offering of our company’s securities. We would most likely rely upon the transaction exemptions from registration provided by Regulation D, Rule 506 or conduct another private offering under Section 4(a)(2) of the Securities Act of 1933. See “Note 2 – Going Concern” in our financial statements for additional information as to the possibility that we may not be able to continue as a “going concern.”

We have no known demands or commitments and are not aware of any events or uncertainties that will result in or that are reasonably likely to materially increase or decrease our current liquidity.

We are not aware of any trends or known demands, commitments, events or uncertainties that will result in or that are reasonably likely to result in material increases or decreases in liquidity.

We had no material commitments for capital expenditures as of May 31, 2018.

Off-Balance Sheet Arrangements.

We have made no off-balance sheet arrangements that have or are reasonably likely to have a current or future effect on our financial condition, changes in financial condition, revenues or expenses, results of operations, liquidity, capital expenditures or capital resources that is material to investors.

Item 3. Quantitative and Qualitative Disclosures About Market Risk.

We are a Smaller Reporting Company as defined by Rule 12b-2 of the Securities Exchange Act of 1934 and are not required to provide the information under this item.

Item 4. Controls and Procedures.

Evaluation of disclosure controls and procedures.

20

Table of Contents

The management of the Company is responsible for establishing and maintaining adequate disclosure controls and procedures. The Company’s disclosure controls and procedures is a process designed under the supervision of the Company’s Chief Executive Officer and Chief Financial Officer to provide reasonable assurance regarding the reliability of financial reporting and the preparation of the Company’s financial statements for external purposes in accordance with U.S. generally accepted accounting principles.

With respect to the period ending May 31, 2018, under the supervision and with the participation of our management, we conducted an evaluation of the effectiveness of the design and operations of our disclosure controls and procedures, as defined in Rules 13a-15(e) and 15d-15(e) promulgated under the Securities Exchange Act of 1934.

Based upon our evaluation regarding the period ending May 31, 2018, the Company’s management, including its Principal Executive Officer and Principal Financial Officer, has concluded that its disclosure controls and procedures were not effective due to the Company’s limited internal resources and lack of ability to have multiple levels of transaction review. Material weaknesses noted are lack of an audit committee, lack of a majority of outside directors on the board of directors, resulting in ineffective oversight in the establishment and monitoring of required internal controls and procedures; and management is dominated by two individuals, without adequate compensating controls. Through the use of external consultants and the review process, management believes that the financial statements and other information presented herewith are materially correct.

Changes in internal control over financial reporting

We have not made any significant changes to our internal controls subsequent to the Evaluation Date. We have not identified any new significant deficiencies or material weaknesses or other factors that could significantly affect these controls, and therefore, no corrective action was taken. However, see the preceding paragraph which discloses the Company’s inadequate disclosure controls and procedures and material weaknesses.

21

Table of Contents

Part II. Other Information

Item 1. Legal Proceedings

None.

Item 1A. Risk Factors

We are a Smaller Reporting Company as defined by Rule 12b-2 of the Securities Exchange Act of 1934 and are not required to provide the information under this item.

Item 2. Unregistered Sales of Equity Securities and Use of Proceeds

Set forth below is information regarding the issuance and sales of Ethos Media Network, Inc. capital stock without registration during the period covered by this report. No sales involved the use of an underwriter and no commissions were paid in connection with the sale of any securities. The shares of our capital stock were issued pursuant to Section 4(2) of the Securities Act of 1933 and the exempt transaction provisions of applicable state law.