ITEM 2. Management's Discussion and Analysis of Financial Condition and Results of Operations

The following discussion and analysis is intended as a review of significant factors affecting our financial condition and results of operations for the periods indicated. The discussion should be read in conjunction with our consolidated financial statements and the notes presented herein. In addition to historical information, the following Management's Discussion and Analysis of Financial Condition and Results of Operations contains forward-looking statements that involve risks and uncertainties. Our actual results could differ significantly from those anticipated in these forward-looking statements as a result of certain factors discussed in this Form 10-Q.

Overview and Financial Condition

During the nine months ended March 31, 2009, the Company realized revenues from the sale of branding and image design products and media placement services. As of the date of this report, the Company's ongoing operations have consisted of the sale of these branding and image design products and from raising capital to pay legal fees to settle claims and of expenditures to maintain the Company in compliance with Securities and Exchange Commission regulations such as accounting and auditing and other expenditures related to financial disclosure obligations.

Results of Operations for the nine months ended March 31, 2009 and 2008

The Company had revenues for the nine months ended March 31, 2009 of $925,000 up from $200,000 for the same period ended March 31, 2008. During the nine months ended March 31, 2009, the Company derived revenues from the sale of branding and image design products and media placement services. The Company has traditionally derived revenues from license renewals and residual payments received, the timing of which are typically paid at the discretion of the counter party and are outside the control of the Company.

Amortizable capitalized film costs related to revenues on licensees and the receipt of payments on residuals have been fully amortized or impaired in prior periods. We expense all current costs as incurred.

Selling, general and administrative expenses increased to $432,700 for the nine months ended March 31, 2009, up from $192,200 for the comparable period in 2008. The valuation of derivatives at March 31, 2009 resulted in a $25,200 credit to earnings. This valuation may vary each reporting period as we adjust it to current fair value.

Liabilities for Legal Settlements and Judgments for the nine months ended March 31, 2009 were $472,700, down from $1,532,100 for the nine months ended March 31, 2008. This reduction was due to a reduction in amounts due brought about by negotiated settlements and amounts paid in settlement of litigation and claims..
(see Part II, Item 1, Legal Proceedings below.)

Net Income per common share increased to $0.01 in the nine months ended March 31, 2009 from Nil for the same period the prior year.

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As of March 31, 2009, the Company had no agreements with sub-distributors relating to distribution commitments or guarantees that had not been recognized in the statement of operations.

Our auditors have issued a going concern opinion. This means that there is substantial doubt that we can continue as an on-going business for the next twelve months unless we obtain additional capital to pay our bills. This is because we have not generated material revenues and no revenues are anticipated. Accordingly, we must raise cash from sources other than operations.

Liquidity and Capital Resources

The Company generated $529,300 in cash from operating activities for the nine months ended March 31, 2009 compared with $(9,000) for the same period the previous year. The Company funds operations through revenues, trade payables, the issuance of stock and the proceeds of short term borrowings. Our access to capital resources is limited to obtaining small loans with short term maturities and to use the value of our common stock as currency to settle existing obligations in such situations where the stock is acceptable by the counter party.

Financing Activities:

During the period the Company entered into a transaction with Future Vision Consulting, S.A. of Luxembourg for the purchase of 2,500,000 shares of the Company's common stock for $125,000 which was paid in cash. Stefan Drakelid, a member of the Company's Board of Directors is a principal of Future Vision Consulting, S.A. The shares were delivered and reported after the end of the period covered by this report. We repurchased 41,840,469 shares of common stock for $105,000 and paid $156,000 towards our outstanding debt obligations and judgments. These payments resulted in a net outflow of $136,000 in our financing activities. We expect to continue this trend in the future as we renegotiate our obligations and apply resources to reduce or eliminate such items.

Derivatives:

During nine months ended March 31, 2009, the Company determined that approximately 2.6 million common shares committed and reserved for issuance under grants of options and warrants that were formerly in excess of authorized shares on a fully diluted basis no longer required derivative accounting treatment due to the purchase and retirement of 41,840,469 common shares. Accordingly, the value of $17,400 was reclassified to permanent equity.

Commitments and Capital Expenditures

The Company had no material commitments for capital expenditures. During this period, the Company obtained $529,300 cash through revenues. The Company also has a long-term employment agreement with our President which was approximately $200,000 per year. This agreement has been extended and renewed from time to time.

The Company's continued existence is dependent upon its ability to resolve its liquidity problems. The Company must achieve and sustain a profitable level of operations with positive cash flows and must continue to obtain financing at terms acceptable to adequately to meet its ongoing operational requirements. We have no assurance that future financing will be available to us on acceptable terms. If financing is not available on satisfactory terms, we may be unable to continue, develop or expand our operations. Equity financing could result in additional dilution to existing shareholders.

Off-Balance Sheet Arrangements

Odyssey does not have any relationships with entities or financial partnerships, such as entities often referred to as structured finance or special purpose entities, which would have been established for the purpose of facilitating off-balance sheet financial arrangements.