Introduction

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

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





Plan of Operation

The Company plans to establish, develop, and operate Major League Football ("MLFB") as a professional Spring/Summer football League with 4 initial Franchises located in cities overlooked in large part by existing professional sports leagues and provide fans with high quality players and competition in the NFL's off-season. Major League Football, Inc. (the "Company," "we," "us" or "our") plans to establish, develop, and operate Major League Football ("MLFB") as a professional Spring football League with 4 initial Franchises located in cities overlooked in large part by existing professional sports leagues and provide fans with high quality players and competition in the NFL's off-season. Our plan that was initiated in June 2022 was that the initial teams would be located in Ohio, Virginia, Arkansas, and Texas. Our proposed spring playing schedule avoids all competition with the NFL and colleges and these initial cities have both a passion for sports and football as well as stadium venues whose size will provide our fans an excellent viewing experience at a reasonable rental expense to MLFB. All potential venues are equipped for high quality multi-platform media transmission allowing us the broadcast all our games in multi-levels of today's technology.

We commenced football training camp operations in June 2022 with a camp start date of July 18, 2022, which was located at Ladd-Peebles Stadium in Mobile, Alabama. The training camp was comprised of the four initial teams and included over 260 potential players and coaches. The camp included transportation of certain football equipment from a Texas warehouse along with the purchase of new equipment. However, due a significant delay in negotiating the stadium lease, the Company was delayed in obtaining additional funding from a planned registration statement. The Company was funding the training camp operations from the sale of convertible promissory notes and the sale of common stock from an existing Regulation A offering. Because of the delay, the Company suffered a significant cash flow issue with the payment of hotels and other training camp operating expenses. As a result, the Company shut down the training camp on July 29, 2022. As a result of the shutdown of the training camp, the Company has a significant amount of outstanding accounts payable at July 31, 2022 that the Company is committed to paying in full.

We have commenced planning for a full spring football season in 2023 tentatively commencing a training camp in April 2023 with games from May through June 2023 and a championship game held in July 2023.

MLFB plans to serve as a pipeline to develop players, coaches, officials, scouts, trainers, and all other areas of the game that the NFL needs today. We will also give NFL representatives the opportunity to view our team practices, game footage, practice tapes and confer with league coaches, team officials and staff. We believe this will provide our league with recognition and demonstrate our economic model and the market's desire for spring football.






          3

  Table of Contents

In March 2020, the World Health Organization declared the novel strain of coronavirus (COVID-19) a global pandemic and recommended containment and mitigation measures worldwide. Subsequently, the COVID-19 pandemic has continued to spread and various state and local governments have issued or extended "shelter-in-place" orders. The spread of the pandemic has caused severe disruptions in the global economy and financial markets and could potentially create widespread business continuity issues of an unknown magnitude and duration.

The future operational and financial impact of the COVID-19 pandemic is difficult to determine, and it is not possible to predict the duration and severity of the economic disruption, government restrictions and stimulus, social distancing and phased re-opening of economies, nor estimate the impact that this may have on the Company, its financial condition, and its results of operations. While we believe that the coronavirus pandemic has not had a significant impact on our financial condition and results of operations at this time, the potential economic impact brought by the coronavirus pandemic, which may be exacerbated by the global macroeconomic uncertainty from the ongoing conflict between Russia and Ukraine, is difficult to assess or predict. There may be developments outside of our control that require us to adjust our operating plans. Given the nature of the situation, we cannot reasonably estimate the impact of the coronavirus pandemic on our financial condition, results of operations or cash flows in the future.

Inflation has increased during the period covered by this report and is expected to continue to remain at elevated levels or even increase for the near future. Inflation generally affects us by increasing our cost of our football operating expenses including the costs of professional fees for services provided. We do not believe inflation has had a material effect on our results of operations during the three months ended July 31, 2022.

On September 7, 2022, the Company announced that it had signed two Common Stock Purchase Agreements in the amount of $2,500,000 each or $5,000,000 combined. The ability for the Company to obtain funds from both agreements is contingent on the Company filing and obtaining approval of a Form S-1 Registration Statement with the Securities and Exchange Commission ("SEC"). As previously announced, the Company continues to move forward with plans to pay all obligations incurred while preparing for a full season of spring football in 2023. The key management team of the Company remains intact and dedicated to this goal. In addition to these two agreements, the Company continues to have discussions with other parties for potential funding. The Common Stock Purchase Agreements are contingent on approval of the Form S-1 Registration Statement, which may not occur in a timely fashion, as it is dependent on the process and timeframe of the SEC. As a result, we may not be able to achieve these capital-raising objectives and if the required capital is not obtained in the proposed timeframe, the Company's planned 2023 spring football season could be delayed or not occur.





Single Entity Structure

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





    ·   Centralized contracting for 'players' services for controlled payrolls
        without violating antitrust laws
    ·   Greater parity among teams
    ·   Focus on the bottom line
    ·   Controlled costs





          4

  Table of Contents

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





MLFB Market Opportunity

MLFB intends to establish a brand that is fan-friendly, exciting, affordable, and interactive, but most importantly provides consumers real value for their sports dollars. MLFB will underscore the fans' access to team members, coaches, league officials and other fans. Although MLFB's ticket pricing will be a fraction of that of the established professional leagues (NBA, MLB, NHL, and NFL), its ultimate goal will be to offer its fans an incomparable value-added experience for their entertainment dollar.

Additionally, as a result of a carefully crafted study, we will not locate teams in any established NFL cities and more importantly in any Major League Baseball cities, thus avoiding direct in-season competition with an established sports entity. By positioning teams in prime emerging and under-represented markets throughout the contiguous 48 states (including placing teams in well respected and football fan friendly metropolitan markets in the country), our research suggests that an exciting sports entity like Major League Football will be viewed in a positive light by sports fans throughout the US. Of equal or greater importance to Major League Football is the fact that both established and peripheral football fans in these exciting new markets will finally be afforded the opportunity of establishing their own personal sports identity while at the same time fostering strong community pride.

Lastly, although MLFB's long-range vision is to maintain a positive working relationship with the NFL, its ultimate intent is to function as an independent, stand-alone entity that captures sports content needed during off season. Although its economic model was, we believe, flawed, the professional Alliance of American Football teams drew a League wide average attendance of 15,000 fans per game and television ratings comparable to the NBA. The XFL had similar positive attendance in its five-game season.

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

MLFB also intends to create an interactive website that includes a social networking aspect, podcasts, live video, and more. Along with this new media strategy, cross promotions will also be an important part of the MLFB's marketing strategy. MLFB plans to work with businesses involved in video, television, print media and the Internet to promote its business. Much of the necessary preliminary work to meet this new strategy has already been performed by our previously announced external contractors, BDB Entertainment Group, Inc., and Red Moon Marketing.






          5

  Table of Contents

We intend to review their qualifications and believe that the cumulative effect of this work will help it achieve its early objectives, which include the following:





    ·   Establish itself as a recognized professional football league
    ·   Build a base of teams and fans broad enough to sustain business over the
        critical first five years of operation
    ·   Generate enough revenue to expand its operations in years three through
        six
    ·   Build successful teams located in regions where there are no existing MLB
        franchises
    ·   Adopt a spring schedule to avoid competing with NFL, collegiate and prep
        football
    ·   Provide year-round cash flow from multi-functioning revenue streams
    ·   Build a positive image for the league through year-round community
        relations campaigns




 Professional Sports Market

MLFB recognizes the NFL is the dominant professional sports league in the United States. Although it respects the success of the NFL business model, MLFB's objective is to position itself as an independent, non-adversarial football league. MLFB believes that its own business model encompasses innovations that will be viewed positively by NFL officials, resulting in a strong working relationship between the two leagues. MLFB staff have held meetings with high-ranking NFL officials to discuss our plans.

MLFB intends to maximize ticket vendor technology and enhance its services to patrons with innovative ticketing procedures that include:





    ·   Average ticket prices targeted at approximately 25% of the prices of NFL,
        NBA, NHL & MLB tickets.
    ·   Year-round cash flow from multiple revenue streams utilizing new
        technologies.
    ·   A highly developed marketing strategy that uses both traditional and new
        media to attract existing football fans as well as an entirely untapped
        market of potential new fans.
    ·   A more interactive website in professional sports using cutting edge
        technologies to preserve fan loyalty.
    ·   Proven executive staff members with considerable practical experience in
        professional football.
    ·   Player and coaching costs projected significantly less than those of the
        NFL, NBA, NHL, or MLB.

Initially, teams will operate in either existing collegiate or municipal stadiums during the spring and early summer season. We believe that our business model and long-range vision possess many innovations that will be viewed in a positive light by NFL owners and league officials and will also lend itself to the potential of establishing a strong working relationship with our venture by positioning ourselves in a 100% non-adversarial position to the established NFL.





Audience

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






          6

  Table of Contents

Merchandising & Licensing Overview

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

The main benefits of the program are:





    ·   Fans will find quality items at more favorable price points.
    ·   Teams will have higher profit on items and stop tying up money on
        inventory they cannot' properly sell.
    ·   More fans will be wearing and supporting the team and league branded
        merchandise.

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





 Financial Condition

As reflected in the unaudited financial statements, the Company had limited revenues and had a net loss of $3,721,594 for the three months ended July 31, 2022. Additionally, the Company had net cash used in operating activities of $1,951,422 for the three months ended July 31, 2022. At July 31, 2022, the Company has a working capital deficit of $6,743,605, an accumulated deficit of $35,803,996 and a stockholders' deficit of $6,165,251, which could have a material impact on the Company's financial condition and operations.





Results of Operations

Three months ending July 31, 2022, compared to the three months ended July 31, 2021

During the three months ended July 31, 2022, the Company recorded $8,677 of revenue and $7,365 of cost of goods sold related to the sale of MLFB on-line digital media merchandise. As a result, the Company realized a gross margin of $1,312 related to the sale of MLFB-on-line digital media merchandise with no comparable amounts in 2021.

Total operating expenses for the three months ended July 31, 2022, were $3,377,656 as compared to total operating expenses for the three months ended July 31, 2021 of $415,210 or an increase of $2,962,446. The increase in expense from 2021 to 2022 was primarily from a $2,261,389 increase in football camp expense, an $846,068 increase in compensation, a $52,500 increase in write off of prepaid investor relation fees and a $61,477 increase in professional fees, offset by a $312,800 decrease in general and administrative expense. The increase in football camp expense was related to the Company's training camp in Mobile Alabama with no comparable amount in 2021. The increase in compensation is related to payroll for corporate and coaches with no comparable amount in 2021. The increase in write off of prepaid investor relation fees was because the services were provided and expensed. The increase in legal fees is primarily related to a $30,850 increase in legal expense and a $20,357 increase in consulting expense. The increase in legal expense was primarily from expenses for the Company's Regulation A and proposed S-1 offering with no comparable amount in 2021. The increase in consulting expense was primarily related to expenses incurred for the Company's training camp held in Mobile Alabama with no comparable amount in 2021. The decrease in general and administrative expense was primarily related to $290,031 of stock compensation expense in 2021 with no comparable amount in 2022. The stock compensation expense was comprised of $191,250 for stock issued and $98,781 for warrants issued to key consultants.






          7

  Table of Contents

Other income (expense) for the three months ended July 31, 2022, was $345,250 of expense compared to $145,714 of expense for the three months ended July 31, 2021 or an increase in expense of $199,536. The increase in expense from 2021 to 2022 was primarily from a $372,384 increase in interest expense and a $176,216 increase in settlement income. The increase in interest expense was primarily from $244,749 of amortization of debt issue costs and original issue discount on convertible promissory notes, $90,820 from a put premium liability on a convertible unsecured promissory note and $36,816 for interest on other debt. The increase in settlement income was primarily from $121,216 of income from the settlement of outstanding judgments against the company as compared to a $55,000 settlement expense in 2021 from the issuance of a note payable.

Because of the above, we had a net loss of $3,721,594 as compared to a net loss of $560,924 for the three months ended July 31, 2022, and 2021, respectively.

Liquidity and Capital Resources

From inception, our Company has relied upon the infusion of capital through equity transactions and the issuance of debt to obtain liquidity. We had only $4,851 of cash at July 31, 2022. Consequently, payment of operating expenses will have to come similarly from either equity capital to be raised from investors or from borrowed funds. There is no assurance that we will be successful in raising such additional equity capital or additional borrowings or if we can, that we can do so at a cost that management believes to be appropriate. See Significant Events for additional discussion.

Condensed Cash Flow Activity

The following table summarizes selected items from our condensed unaudited Statements of Cash Flows for the three months ended July 31, 2022, and 2021:





                                                 For the Three Months Ended,
                                             July 31, 2022         July 31, 2021

Net cash used in operating activities $ (1,951,422 ) $ (110,483 ) Net cash used in investing activities

                (76,268 )                  -
Net cash provided by financing activities          1,359,360               95,000

Net decrease in cash                        $       (668,330 )    $       (15,483 )

Net Cash Used in Operating Activities

Net cash used in operating activities was $1,951,422 during the three months ended July 31, 2022, compared to $110,483 used during the three months ended July 31, 2021, or an increase in cash used of $1,840,939. After adjusting for non-cash expense items of $320,229 in 2022 and $395,384 in 2021, adjusted net cash used in operations would be $1,631,193 in 2022 and adjusted non-cash provided by operations would be $284,901 in 2021. After making these non-cash adjustments, the previously discussed Results of Operations analysis shows that the increase in the net cash used in operating activities was primarily from an increase in the operating expenses of the Company from 2021 to 2022.






          8

  Table of Contents

Net Cash Used in Investing Activities

Net cash used in investing activities was $76,268 during the three months ended July 31, 2022, compared to $0 during the three months ended July 31, 2021, or an increase of $76,268. The $76,268 during the three months ended July 31, 2022, was for the purchase of football equipment.

Net Cash Provided by Financing Activities

Net cash provided by financing activities was $1,359,360 of net cash during the three months ended July 31, 2022, as compared to $95,000 provided during the three months ended July 31, 2021, or an increase of $1,264,360. The increase in net cash provided from 2021 to 2022 was primarily from (1) $549,800 of proceeds from the sale of common stock in 2022 with no comparable amount in 2021, (2) $468,760 of proceeds from the issuance of convertible secured promissory notes, (3) $202,000 of proceeds from the issuance of convertible unsecured promissory notes as compared to $95,000 in 2021 and (4) $148,800 of proceeds from the issuance of notes payable in 2022 with no comparable amount in 2021. This was offset by the repayment of $5,000 for a note payable and a repayment of $5,000 for an unsecured convertible promissory note with no comparable amount in 2021.

Off-Balance Sheet Arrangements

At July 31, 2022, we did not have any off-balance sheet arrangements that we believe have or are reasonably likely to have a current or future effect on our financial condition, changes in financial condition, revenue or expenses, results of operations, liquidity, capital expenditures or capital resources that are material to investors.





Critical Accounting Policies

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

© Edgar Online, source Glimpses