Document and Entity Information
Document and Entity Information - USD ($) | 12 Months Ended | ||
Dec. 31, 2017 | Apr. 13, 2018 | Jun. 30, 2017 | |
Document And Entity Information | |||
Entity Registrant Name | AGRITEK HOLDINGS, INC. | ||
Entity Central Index Key | 1,040,850 | ||
Document Type | 10-K | ||
Document Period End Date | Dec. 31, 2017 | ||
Amendment Flag | false | ||
Current Fiscal Year End Date | --12-31 | ||
Is Entity a Well-known Seasoned Issuer? | No | ||
Is Entity a Voluntary Filer? | No | ||
Is Entity's Reporting Status Current? | Yes | ||
Entity Filer Category | Smaller Reporting Company | ||
Entity Public Float | $ 5,664,173 | ||
Entity Common Stock, Shares Outstanding | 779,245,512 | ||
Document Fiscal Period Focus | FY | ||
Document Fiscal Year Focus | 2,017 |
CONSOLIDATED BALANCE SHEETS
CONSOLIDATED BALANCE SHEETS - USD ($) | Dec. 31, 2017 | Dec. 31, 2016 |
Current Assets: | ||
Cash and cash equivalents | $ 304,889 | $ 67,260 |
Marketable Securities | 41,862 | 39,769 |
Inventory, net | 10,000 | |
Prepaid assets and other | 48,500 | 10,000 |
Total current assets | 405,251 | 117,029 |
Note receivable | 210,000 | |
Property and equipment, net of accumulated depreciation of $23,824 (2017) and $8,308 (2016) | 286,415 | 26,280 |
Investments in non-marketable securities | 50,000 | |
Security deposit and other | 13,825 | 825 |
Total assets | 915,491 | 194,134 |
Current Liabilities: | ||
Accounts payable and accrued expenses | 1,089,333 | 550,885 |
Due to related party | 7,715 | 54,246 |
Customer deposits | 2,400 | 2,400 |
Deferred rent | 24,916 | |
Convertible note payable, net of discounts of $494,193 (2017) and $257,034 (2016) | 485,250 | 569,446 |
Derivative liabilities | 5,416,830 | 1,613,770 |
Note payable, current portion | 51,500 | |
Total current liabilities | 7,077,944 | 2,790,747 |
Total liabilities | 7,077,944 | 2,790,747 |
Commitments and Contingencies | ||
Stockholders' Deficit: | ||
Series B convertible preferred stock, $0.01 par value; 1,000,000 shares authorized, and 1,000 shares issued and outstanding | 10 | 10 |
Common stock, $.0001 par value; 1,000,000,000 shares authorized; 723,680,348 (2017) and 400,867,449 (2016) shares issued and outstanding | 72,369 | 40,087 |
Common stock to be issued | 5,257 | |
Additional paid-in capital | 19,312,650 | 13,764,813 |
Deferred expenses | ||
Accumulated comprehensive gain | 25,337 | 23,244 |
Accumulated deficit | (25,578,077) | (16,424,767) |
Total stockholders' deficit | (6,162,454) | (2,596,613) |
Total liabiities and stockholders' deficit | $ 915,491 | $ 194,134 |
CONSOLIDATED BALANCE SHEETS (Pa
CONSOLIDATED BALANCE SHEETS (Parenthetical) - USD ($) | Dec. 31, 2017 | Dec. 31, 2016 |
Assets | ||
Accumulated depreciation of property and equipment | $ (23,824) | $ (8,308) |
Current Liabilities | ||
Discount on convertible notes payable | $ (494,193) | $ (257,034) |
Stockholders' Deficit | ||
Preferred stock Series B par value | $ 0.01 | $ 0.01 |
Preferred stock Series B authorized | 1,000,000 | 1,000,000 |
Preferred stock Series B issued | 1,000 | 1,000 |
Preferred stock Series B outstanding | 1,000 | 1,000 |
Common stock par value | $ 0.0001 | $ 0.0001 |
Common stock shares authorized | 1,000,000,000 | 500,000,000 |
Common stock shares issued | 723,680,348 | 400,867,449 |
Common stock shares outstanding | 723,680,348 | 400,867,449 |
CONSOLIDATED STATEMENTS OF OPER
CONSOLIDATED STATEMENTS OF OPERATIONS - USD ($) | 12 Months Ended | |
Dec. 31, 2017 | Dec. 31, 2016 | |
Income Statement [Abstract] | ||
Consulting income | $ 48,000 | |
Product revenue | 2,000 | 3,228 |
Total revenue | 50,000 | 3,228 |
Cost of revenue, includes $30,000 related party for 2017 | 64,000 | 3,161 |
Gross profit (loss) | (14,000) | 67 |
Operating Expenses: | ||
Management fees | 421,000 | 150,000 |
Administrative fees | 83,200 | 13,850 |
Professional and consulting fees | 730,357 | 161,150 |
Rent and other occupancy costs | 101,279 | 40,303 |
Leased property expense | 41,546 | 114,894 |
Other general and administartive expenses | 338,601 | 127,724 |
Total operating expenses | 1,715,983 | 607,921 |
Operating loss | (1,729,983) | (607,854) |
Other Income (Expense): | ||
Gain (loss) on debt settlement | (114,781) | 84,057 |
Loss on legal matter | (399,291) | |
Impairment of investments | (50,000) | (255,000) |
Interest expense | (1,873,198) | (742,021) |
Derivative liability expense | (4,986,057) | (1,457,071) |
Total other expense, net | (7,423,327) | (2,370,035) |
Net loss | (9,153,310) | (2,977,889) |
Unrealized gain on marketable securities | 2,093 | 23,244 |
Net comprehensive loss | $ (9,151,217) | $ (2,954,645) |
Basic and diluted loss per share | $ (0.02) | $ (0.01) |
Weighted average number of common shares outstanding Basic and diluted | 536,650,839 | 334,772,545 |
CONSOLIDATED STATEMENTS OF OPE5
CONSOLIDATED STATEMENTS OF OPERATIONS (Parenthetical) | 12 Months Ended |
Dec. 31, 2017USD ($) | |
Income Statement [Abstract] | |
Related party cost of revenue | $ 30,000 |
CONSOLIDATED STATEMENT OF STOCK
CONSOLIDATED STATEMENT OF STOCKHOLDERS' DEFICIT - USD ($) | Common stock | Common stock to be issued | Series B Preferred stock | Additional Paid-in Capital | Accumulated Comprehensive Gain | Accumulated Deficit | Total |
Beginning balance, shares at Dec. 31, 2015 | 281,540,332 | 1,000 | |||||
Beginning balance, amount at Dec. 31, 2015 | $ 28,155 | $ 10 | $ 12,536,138 | $ (13,446,878) | $ (882,575) | ||
Common stock issued upon conversion of convertible debt and accrued interest, shares | 114,327,117 | ||||||
Common stock issued upon conversion of convertible debt and accrued interest, amount | $ 11,432 | 179,953 | 191,385 | ||||
Issuance of warrants for services | 2,371 | 2,371 | |||||
Issuance of common stock for acquisition, shares | 5,000,000 | ||||||
Issuance of common stock for acquisition, amount | $ 500 | 254,500 | 255,000 | ||||
Reclassification for conversions of convertible debt | 791,851 | 791,851 | |||||
Common stock issued upon cashless warrant exercises, amount | |||||||
Unrealized gain on marketable securities | 23,244 | 23,244 | |||||
Net loss | (2,977,889) | (2,977,889) | |||||
Ending balance, shares at Dec. 31, 2016 | 400,867,449 | 1,000 | |||||
Ending balance, amount at Dec. 31, 2016 | $ 40,087 | $ 10 | 13,764,813 | 23,244 | (16,424,767) | (2,596,613) | |
Common stock issued upon conversion of convertible debt and accrued interest, shares | 194,559,519 | ||||||
Common stock issued upon conversion of convertible debt and accrued interest, amount | $ 19,457 | 1,420,638 | 1,440,095 | ||||
Common stock issued for additional interest on convertible notes, shares | 1,319,149 | ||||||
Common stock issued for additional interest on convertible notes, amount | $ 132 | 15,962 | 16,094 | ||||
Common stock issued upon settlement of accounts payable, shares | 2,000,000 | ||||||
Common stock issued upon settlement of accounts payable, amount | $ 200 | 55,500 | 55,700 | ||||
Issuance of common stock investment in Canadian property, shares | 5,000,000 | ||||||
Issuance of common stock investment in Canadian property, amount | $ 500 | 61,000 | 61,500 | ||||
Common stock issued for services, related party, shares | 10,000,000 | ||||||
Common stock issued for services, related party, amount | $ 1,000 | 300,000 | 301,000 | ||||
Amortization of deferred stock compensation | |||||||
Issuance of common stock for services, shares | 7,000,000 | ||||||
Issuance of common stock for services, amount | $ 700 | 157,400 | 158,100 | ||||
Reclassification for conversions of convertible debt | 3,007,887 | 3,007,887 | |||||
Common stock to be issued pursuant to Stock Purchase Agreements, shares | 52,574,335 | ||||||
Common stock to be issued pursuant to Stock Purchase Agreements, amount | $ 5,257 | 539,743 | 545,000 | ||||
Common stock previously cancelled on Company’s records, shares | 15,000,000 | ||||||
Common stock previously cancelled on Company’s records, amount | $ 1,500 | (1,500) | |||||
Common stock issued upon cashless warrant exercises, shares | 87,934,231 | ||||||
Common stock issued upon cashless warrant exercises, amount | $ 8,793 | 8,793 | |||||
Unrealized gain on marketable securities | 2,093 | 2,093 | |||||
Net loss | (9,153,310) | (9,153,310) | |||||
Ending balance, shares at Dec. 31, 2017 | 723,680,348 | 52,574,335 | 1,000 | ||||
Ending balance, amount at Dec. 31, 2017 | $ 72,369 | $ 5,257 | $ 10 | $ 19,312,650 | $ 25,337 | $ (25,578,077) | $ (6,162,454) |
CONSOLIDATED STATEMENTS OF CASH
CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) | 12 Months Ended | |
Dec. 31, 2017 | Dec. 31, 2016 | |
Cash flows from operating activities | ||
Net loss | $ (9,153,310) | $ (2,977,889) |
Adjustments to reconcile net loss to net cash used in operating activities: | ||
Stock based compensation | 520,600 | 2,371 |
Common stock issued for additional interest to convertible noteholder | 16,091 | |
Amortization of deferred financing costs | 128,220 | |
Impairment of investments | 50,000 | 255,000 |
Loss on settlement of accounts payable | 17,916 | |
Depreciation | 15,516 | 3,566 |
Initial expense for fair value of derivative liabilities | 2,223,824 | 3,249,056 |
Amortization of discounts on convertible notes | 1,587,831 | 635,780 |
Change in fair values of derivative liabilities | 2,762,231 | (1,791,988) |
Gain on debt settlement | (84,057) | |
Changes in operating assets and liabilities: | ||
Decrease (increase) in Inventory | (10,000) | |
Decrease (increase) in Prepaid assets and other | (38,500) | (6,667) |
Decrease (increase) in Security deposit | (13,000) | |
Increase (decrease) in Accounts payable and accrued expenses | 685,361 | 234,234 |
Increase (decrease) in Due to related party | (46,531) | 32,935 |
Increase (decrease) in Deferred rent | 24,916 | |
Increase (decrease) in Tenant deposits | 2,400 | |
Net cash used in operating activities | (1,228,835) | (445,260) |
Cash flows from investing activities: | ||
Purchase of property, equipment and furniture | (187,651) | (20,757) |
Purchase of notes receivable | (210,000) | |
Net cash used in investing activities | (397,651) | (20,757) |
Cash flows from financing activities: | ||
Proceeds from issuance of convertible debt | 1,678,494 | 521,731 |
Payments made of principal and accrued interest on convertible notes | (322,879) | |
Payments made on note payable | (36,500) | |
Proceeds from sale of common stock to be issued | 545,000 | |
Net cash provided by financing activities | 1,864,115 | 521,731 |
Net increase in cash and cash equivalents | 237,629 | 55,711 |
Cash and cash equivalents, Beginning | 67,260 | 11,548 |
Cash and cash equivalents, Ending | 304,889 | 67,260 |
Supplemental disclosure of cash flow information: | ||
Cash paid for interest | 1,275 | |
Cash paid for income taxes | ||
Schedule of non-cash financing activities: | ||
Discount from derivatives | 1,824,892 | 865,593 |
Accrued interest converted into convertible note | 6,398 | |
Conversion of notes payable and interest into common stock | 1,440,093 | 191,386 |
Fair value of marketable securities issued in exchange for debt | 16,525 | |
Change in fair value for available for sale marketable securities | 2,093 | 23,244 |
Issuance of note payable as part of land acquisition | 88,000 | |
Settlement of derivatives | 3,007,887 | 791,851 |
Stock issued for settlement of accounts payable | 37,784 | |
Stock issued for cashless exercise | $ 8,793 |
Organization
Organization | 12 Months Ended |
Dec. 31, 2017 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Organization | Note 1 - Organization Business Agritek Holdings Inc. (“the Company” or “Agritek Holdings”) and its wholly-owned subsidiaries, MediSwipe, Inc. (“MediSwipe”), Prohibition Products Inc., and Agritek Venture Holdings, Inc. (“AVHI”) is a fully integrated, active investor and operator in the legal cannabis sector. Specifically, Agritek Holdings provides strategic capital and functional expertise to accelerate the commercialization of its diversified portfolio of holdings. Currently, the Company is focused on three high-value segments of the cannabis market, including real estate investment, intellectual property brands; and infrastructure, with operations in three U.S. States, Colorado, Washington State, California as well as Canada and Puerto Rico. Agritek Holdings invests its capital via real estate holdings, licensing agreements, royalties and equity in acquisition operations. We provide key business services to the legal cannabis sector including: • Funding and Financing Solutions for Agricultural Land and Properties zoned for the regulated Cannabis Industry. • Dispensary and Retail Solutions • Commercial Production and Equipment Build Out Solutions • Multichannel Supply Chain Solutions • Branding, Marketing and Sales Solutions of proprietary product lines • Consumer Product Solutions The Company intends to bring its’ array of services to each new state that legalizes the use of cannabis according to appropriate state and federal laws. Our primary objective is acquiring commercial properties to be utilized in the commercial marijuana industry as cultivation facilities in compliance with state laws. This is an essential aspect of our overall growth strategy because once acquired and re-zoned, the value of such real property is substantially higher than under the previous zoning and use. Once properties are identified and acquired to be used for purposes related to the commercial marijuana industry as provided for by state law, and we plan to create vertical channels within that legal jurisdiction including equipment financing, payment processing and marketing of exclusive brands and services to retail dispensaries. Agritek’s business focus is primarily to hold, develop and manage real property. The Company shall also provide oversight on every property that is part of its portfolio. This can include complete architectural design and subsequent build-outs, general support, landscaping, general up-keep, and state of the art security systems. At this time, Agritek does not grow, process, own, handle, transport, or sell marijuana as the Company is organized and directed to operate strictly in accordance with all applicable state and federal laws. As the legal environment changes in Colorado, California and other states, the Company’s management may explore business opportunities that involve ownership interests in dispensaries and growing operations if and when such business opportunities become legally permissible under applicable state and federal laws. |
Summary of Significant Account
Summary of Significant Account Policies | 12 Months Ended |
Dec. 31, 2017 | |
Accounting Policies [Abstract] | |
Summary of Significant Account Policies | Note 2 – Summary of Significant Accounting Policies Basis of Presentation and Principles of Consolidation The accompanying consolidated financial statements are prepared in accordance with Generally Accepted Accounting Principles in the United States of America ("US GAAP"). The consolidated financial statements of the Company include the consolidated accounts of Agritek and its’ wholly owned subsidiaries MediSwipe, AVHI, The American Hemp Trading Company, Inc., a Colorado Corporation (dba 77Acres, Inc.) and PPI. PPI, a Florida corporation, was originally formed on July 1, 2013 as The American Hemp Trading Company, Inc. (“HempFL”) and on August 27, 2014, HempFL changed its’ name to PPI. All intercompany accounts and transactions have been eliminated in consolidation. Cash and Cash Equivalents The Company considers all highly liquid investments with an original term of three months or less to be cash equivalents. Accounts Receivable The Company records accounts receivable from amounts due from its customers upon the shipment of products. The allowance for losses is established through a provision for losses charged to expenses. Receivables are charged against the allowance for losses when management believes collectability is unlikely. The allowance is an amount that management believes will be adequate to absorb estimated losses on existing receivables, based on evaluation of the collectability of the accounts and prior loss experience. While management uses the best information available to make its evaluations, this estimate is susceptible to significant change in the near term. As of December 31, 2017 and 2016, based on the above criteria, the Company has a full allowance for doubtful accounts of $43,408. Inventory Inventory is valued at the lower of cost or market value. Cost is determined using the first in first out (FIFO) method. Provision for pot entially obsolete or slow-moving inventory is made based on management analysis or inventory levels and future sales forecasts. Notes receivable During the year ended December 31, 2017, the Company has recorded notes receivable the following: • $110,000 pursuant to a five (5) year operational and exclusive licensing agreement with a third party who leases a 25,000-sq. ft. approved cultivation facility located in San Juan, Puerto Rico (see Note 10). • $100,000 pursuant to a five (5) year operational and exclusive licensing agreement with a third party who leases a 10,000-sq. ft. approved cultivation facility located in Washington State (see Note 10). Deferred Financing Costs The costs related to the issuance of debt are capitalized and amortized to interest expense using the straight-line method through the maturities of the related debt. Derivative Financial Instruments The Company does not use derivative instruments to hedge exposures to cash flow, market, or foreign currency risks. The Company evaluates all of it financial instruments, including stock purchase warrants, to determine if such instruments are derivatives or contain features that qualify as embedded derivatives. For derivative financial instruments that are accounted for as liabilities, the derivative instrument is initially recorded at its fair value and is then re-valued at each reporting date, with changes in the fair value reported as charges or credits to income. For option-based simple derivative financial instruments, the Company uses the Black-Scholes option-pricing model to value the derivative instruments at inception and subsequent valuation dates. The classification of derivative instruments, including whether such instruments should be recorded as liabilities or as equity, is re-assessed at the end of each reporting period. Debt Issue Costs and Debt Discount The Company may record debt issue costs and/or debt discounts in connection with raising funds through the issuance of debt. These costs may be paid in the form of cash, or equity (such as warrants). These costs are amortized to interest expense over the life of the debt. If a conversion of the underlying debt occurs prior to maturity a proportionate share of the unamortized amounts is immediately expensed. Original Issue Discount For certain convertible debt issued, the Company may provide the debt holder with an original issue discount. The original issue discount would be recorded to debt discount, reducing the initial carrying value of the note and is amortized to interest expense through the maturity of the debt. If a conversion of the underlying debt occurs prior to maturity a proportionate share of the unamortized amounts is immediately expensed. Marketable Securities and Other Comprehensive Income The Company classifies its marketable securities as available-for-sale securities, which are carried at their fair value based on the quoted market prices of the securities with unrealized gains and losses, net of deferred income taxes, reported as accumulated other comprehensive income (loss), a separate component of stockholders’ equity. Realized gains and losses on available-for-sale securities are included in net earnings in the period earned or incurred. Investment of Non-Marketable Securities In 2014, the Company purchased an investment in non-marketable securities of a less than 10% interest in two privately held companies of $25,000 each, that provide merchant processing services. During the year ended December 31, 2017, due to recent losses, management wrote off the investment of $50,000, which is included in Other expenses on the consolidated statements of operations included herein. As of December 31, 2017, and 2016, the balance of the Investment of Non-Marketable Securities and Other was $-0- and $50,000, respectively Property and Equipment Property and equipment are stated at cost, and except for land, depreciation is provided by use of a straight-line method over the estimated useful lives of the assets. The Company reviews property and equipment for potential impairment whenever events or changes in circumstances indicate that the carrying amounts of assets may not be recoverable. In February, 2017, the Company entered into a land purchase contract to acquire approximately 80 acres including water and mineral rights. The total cost of the land was $129,555. The Company paid $41,554 at closing and issued a note payable for $88,000. As of December 31, 2017, the Company is on the deed of trust of the property with a remaining note balance of $51,500 due the seller. The estimated useful lives of property and equipment are as follows: Furniture and equipment 5 years Manufacturing equipment 7 years The Company's property and equipment consisted of the following at December 31, 2017, and 2016: December 31, December 31, Furniture and equipment $ 180,684 $ 34,587 Land 129,555 — Accumulated depreciation (23,824 ) (8,307 ) Balance $ 286,415 $ 26,280 Depreciation expense of $15,516 and $3,566 was recorded for the years ended December 31, 2017, and 2016, respectively. Long-Lived Assets Long-lived assets are reviewed for impairment when events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. Deferred rent The Company calculates the total cost of the lease for the entire lease period and divides that amount by the number of months of the lease. The result is the average monthly expense and is charged to rent expense with the offset to deferred rent, irrespective of the actual amount paid. The amounts paid are charged to the deferred rent account. Rent expense of $45,417 for the year ended December 31, 2017, was recorded for the office space in Puerto Rico and the Company made payments of $20,516. As of December 31, 2017, the Company has a balance of $24,916 in deferred rent which is included in the consolidated balance sheet. Revenue Recognition The Company recognizes revenue in accordance with FASB ASC 605, Revenue Recognition. ASC 605 requires that four basic criteria are met: (1) persuasive evidence of an arrangement exists, (2) delivery of products and services has occurred, (3) the fee is fixed or determinable and (4) collectability is reasonably assured. The Company recognizes revenue during the month in which products are shipped or fees are earned. Consulting revenue of $48,000 and product sales (net) of $2,000 has been recognized for the year ended December 31, 2017. Fair Value of Financial Instruments The Company measures assets and liabilities at fair value based on an expected exit price as defined by the authoritative guidance on fair value measurements, which represents the amount that would be received on the sale of an asset or paid to transfer a liability, as the case may be, in an orderly transaction between market participants. As such, fair value may be based on assumptions that market participants would use in pricing an asset or liability. The authoritative guidance on fair value measurements establishes a consistent framework for measuring fair value on either a recurring or nonrecurring basis whereby inputs, used in valuation techniques, are assigned a hierarchical level. The following are the hierarchical levels of inputs to measure fair value: ☐ Level 1 - Observable inputs that reflect quoted market prices in active markets for identical assets or liabilities. ☐ Level 2 - Inputs reflect quoted prices for identical assets or liabilities in markets that are not active; quoted prices for similar assets or liabilities in active markets; inputs other than quoted prices that are observable for the assets or liabilities; or inputs that are derived principally from or corroborated by observable market data by correlation or other means. ☐ Level 3 - Unobservable inputs reflecting the Company's assumptions incorporated in valuation techniques used to determine fair value. These assumptions are required to be consistent with market participant assumptions that are reasonably available. The carrying amounts of the Company's financial assets and liabilities, such as cash, prepaid expenses, other current assets, accounts payable and accrued expenses, certain notes payable and notes payable - related party, approximate their fair values because of the short maturity of these instruments. The following table represents the Company’s financial instruments that are measured at fair value on a recurring basis as of December 31, 2017, and 2016, for each fair value hierarchy level: December 31, 2017 Derivative Liabilities Total Level I $ — $ — Level II $ — $ — Level III $ 5,416,830 $ 5,416,830 December 31, 2016 Level I $ — $ — Level II $ — $ — Level III $ 1,613,770 $ 1,613,770 Income Taxes The Company accounts for income taxes in accordance with ASC 740-10, Income Taxes. Deferred tax assets and liabilities are recognized to reflect the estimated future tax effects, calculated at the tax rate expected to be in effect at the time of realization. A valuation allowance related to a deferred tax asset is recorded when it is more likely than not that some portion of the deferred tax asset will not be realized. Deferred tax assets and liabilities are adjusted for the effects of the changes in tax laws and rates of the date of enactment. ASC 740-10 prescribes a recognition threshold that a tax position is required to meet before being recognized in the financial statements and provides guidance on recognition, measurement, classification, interest and penalties, accounting in interim periods, disclosure and transition issues. Interest and penalties are classified as a component of interest and other expenses. To date, the Company has not been assessed, nor paid, any interest or penalties. Uncertain tax positions are measured and recorded by establishing a threshold for the financial statement recognition and measurement of a tax position taken or expected to be taken in a tax return. Only tax positions meeting the more-likely-than-not recognition threshold at the effective date may be recognized or continue to be recognized. The Company’s tax years subsequent to 2005 remain subject to examination by federal and state tax jurisdictions. Earnings (Loss) Per Share Earnings (loss) per share are computed in accordance with ASC 260, "Earnings per Share". Basic earnings (loss) per share is computed by dividing net income (loss), after deducting preferred stock dividends accumulated during the period, by the weighted-average number of shares of common stock outstanding during each period. Diluted earnings per share is computed by dividing net income by the weighted-average number of shares of common stock, common stock equivalents and other potentially dilutive securities, if any, outstanding during the period. As of December 31, 2017, there were warrants and options to purchase 49,135,392 shares of common stock and the Company’s outstanding convertible debt is convertible into approximately 138,041,561 shares of common stock. These amounts are not included in the computation of dilutive loss per share because their impact is anti-dilutive. Accounting for Stock-Based Compensation The Company accounts for stock awards issued to non-employees in accordance with ASC 505-50, Equity-Based Payments to Non-Employees. The measurement date is the earlier of (1) the date at which a commitment for performance by the counterparty to earn the equity instruments is reached, or (2) the date at which the counterparty's performance is complete. Stock awards granted to non-employees are valued at their respective measurement dates based on the trading price of the Company’s common stock and recognized as expense during the period in which services are provided. For the year ended December 31, 2017, and 2016 the Company recorded stock- based compensation of $520,600 and $2,371, respectively (See Notes 10 and 11). Use of Estimates The preparation of consolidated financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosures of contingent assets and liabilities at the date of the consolidated financial statements and the reported amount of revenues and expenses during the reported period. Actual results could differ from those estimates. Advertising The Company records advertising costs as incurred. For the years ending December 31, 2017, and 2016, advertising expenses was $54,927 and $8,321, respectively. |
Recent Accounting Pronouncement
Recent Accounting Pronouncements | 12 Months Ended |
Dec. 31, 2017 | |
Accounting Changes and Error Corrections [Abstract] | |
Recent Accounting Pronouncements | Note 3 – Recent Accounting Pronouncements In February 2016, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) 2016-02, “Leases (Topic 842)”. Under this guidance, an entity is required to recognize right-of-use assets and lease liabilities on its balance sheet and disclose key information about leasing arrangements. This guidance offers specific accounting guidance for a lessee, a lessor and sale and leaseback transactions. Lessees and lessors are required to disclose qualitative and quantitative information about leasing arrangements to enable a user of the financial statements to assess the amount, timing and uncertainty of cash flows arising from leases. This guidance is effective for annual reporting periods beginning after December 15, 2018, including interim periods within that reporting period, and requires a modified retrospective adoption, with early adoption permitted. The Company is currently evaluating the impact of the adoption of this standard will have on our consolidated financial statements. In March 2016, the FASB issued ASU 2016-09, “Compensation - Stock Compensation (Topic 718): Improvements to Employee Share-Based Payment Accounting”. The standard is intended to simplify several areas of accounting for share-based compensation arrangements, including the income tax impact, classification on the statement of cash flows and forfeitures. ASU 2016-09 is effective for fiscal years, and interim periods within those years, beginning after December 15, 2016, and early adoption is permitted. The Company elected to early adopt the new guidance in the second quarter of fiscal year 2016 which requires us to reflect any adjustments as of January 1, 2016, the beginning of the annual period that includes the interim period of adoption. The primary impact of adoption was the recognition of additional stock compensation expense and paid-in capital for all periods in fiscal year 2016. Additional amendments to the recognition of excess tax benefits, accounting for income taxes and minimum statutory withholding tax requirements had no impact to retained earnings as of January 1, 2016, where the cumulative effect of these changes is required to be recorded. We have elected to account for forfeitures as they occur to determine the amount of compensation cost to be recognized in each period. In November 2016, the FASB issued ASU No. 2016-18, “Statement of Cash Flows (Topic 230).” ASU No. 2016-18 requires that restricted cash be included with cash and cash equivalents when reconciling the change in cash flow. This guidance is reflected in these financial statements. In January 2017, the FASB issued ASU 2017-04, Simplifying the Test for Goodwill Impairment, which removes the second step of the two-step goodwill impairment test. Under ASU 2017-04, an entity will apply a one-step quantitative test and record the amount of goodwill impairment as the excess of a reporting unit’s carrying amount over its fair value, not to exceed the total amount of goodwill allocated to the reporting unit. ASU 2017-04 does not amend the optional qualitative assessment of goodwill impairment. Additionally, an entity should consider income tax effects from any tax-deductible goodwill on the carrying amount of the reporting unit when measuring the goodwill impairment loss, if applicable. ASU 2017-04 is effective for annual or any interim goodwill impairment tests in fiscal years beginning after December 15, 2019; early adoption is permitted for interim or annual goodwill impairment tests performed on testing dates after January 1, 2017. The Company has not elected early adoption of this standard and is currently in the process of evaluating the impact of adopting ASU 2017-04 and cannot currently estimate the financial statement impact of adoption. In May 2017, the FASB issued ASU No. 2017-09, “Compensation – Stock Compensation (Topic 718): Scope of Modification Accounting.” The amendments in this update provide guidance about which changes to the terms or conditions of a share-based award require an entity to apply modification accounting in Topic 718. The guidance will be effective for the Company for its fiscal year 2018, with early adoption permitted. The Company does not expect this ASU to materially impact the Company’s consolidated financial statements. Accounting standards that have been issued or proposed by the FASB or other standards-setting bodies that do not require adoption until a future date are not expected to have a material impact on the consolidated financial statements upon adoption. |
Marketable Securities
Marketable Securities | 12 Months Ended |
Dec. 31, 2017 | |
Investments, Debt and Equity Securities [Abstract] | |
Marketable Securities | Note 4 – Marketable Securities The Company owns marketable securities (common stock) as outlined below: 2017 2016 Balance January 1 $ 39,769 $ — Fair value of stock received — 16,525 Unrealized gain marked to fair value 2,093 23,244 Balance December 31 $ 41,862 $ 39,769 800 Commerce, Inc. (now known as Petrogress, Inc), was a commonly controlled entity until February 29, 2016, owed Agritek $282,947 as of February 29, 2016, as a result of advances received from or payments made by Agritek on behalf of 800 Commerce. These advances were non-interest bearing and were due on demand. Effective February 29, 2016, the Company received 1,102,462 shares of common stock of Petrogress, Inc. as settlement of the $282,947 owed to the Company. The market value on the date the Company received the shares of common stock was $16,525. |
Prepaid Expenses
Prepaid Expenses | 12 Months Ended |
Dec. 31, 2017 | |
Other Income (Expense): | |
Prepaid Expenses | Note 5 - Prepaid Expenses Prepaid expenses consisted of the following at December 31, 2017 and December 31, 2016: December 31, 2017 December 31, 2016 Vendor deposits $ 46,000 $ 6,000 Consulting fees — 4,000 Investor relations 2,500 — Total prepaid expenses $ 48,500 $ 10,000 |
Concentration of Credit Risk
Concentration of Credit Risk | 12 Months Ended |
Dec. 31, 2017 | |
Risks and Uncertainties [Abstract] | |
Concentration of Credit Risk | Note 6– Concentration of Credit Risk Cash Financial instruments that potentially subject the Company to concentrations of credit risk consist principally of cash. The Company maintains cash balances at one financial institution, which is insured by the Federal Deposit Insurance Corporation (“FDIC”). The FDIC insured institution insures up to $250,000 on account balances. |
Note Payable
Note Payable | 12 Months Ended |
Dec. 31, 2017 | |
Debt Disclosure [Abstract] | |
Note Payable | Note 7 – Note Payable Note Payable Land In February, 2017, the Company entered into a land purchase contract to acquire approximately 80 acres including water and mineral rights. The total cost of the land was $129,555. The Company paid $41,554 at closing and issued a note payable for $88,000. As of December 31, 2017, the Company is on the deed of trust of the property with a remaining note balance of $51,500 due the seller. |
Convertible Debt
Convertible Debt | 12 Months Ended |
Dec. 31, 2017 | |
Debt Disclosure [Abstract] | |
Convertible Debt | Note 8 – Convertible Debt 2014 Convertible Note In January 2014, the Company entered into a Secured Promissory Note for $1,660,000 (the “2014 Company Note”) to Tonaquint, Inc. (“Tonaquint”) which includes a purchase price of $1,500,000 and transaction costs of $160,000. On January 31, 2014, the Company received $300 ,000 of the purchase price. Tonaquint also issued to the Company 6 secured promissory notes, each in the amount of $200,000 (the 2014 “Investor Notes”). All or any portion of the outstanding balance of the 2014 Investor Notes may be prepaid, without penalty, along with accrued but unpaid interest at any time prior to maturity. The Company has no obligation to pay Tonaquint any amounts on the unfunded portion of the 2014 Company Note. The 2014 Company Note bears interest at 8% per annum (increases to 22% per annum upon an event of default) and is convertible into shares of the Company’s common stock at Tonaquint’s option at a price of $0.55 per share, exercisable in seven tranches, consisting of a first tranche of $340,000 of principal and any interest, fees costs or charges, and six additional tranches of $220,000 each, plus any interest, costs, fees or charges. Beginning on the date that is six (6) months after the later of (i) the Issuance Date, and (ii) the date the Initial Cash Purchase Price is paid to the Company (the “Initial Installment Date”), and on each applicable Installment Date thereafter, the Company is to pay the Holder, the applicable Installment Amount due on such date. Ten Installment Amounts of $166,000 plus the sum of any accrued and unpaid interest, fees, costs or charges may be made (a) in cash (a “Company Redemption”), (b) by converting such Installment Amount into shares of Common Stock (a “Company Conversion”), or (c) by any combination of a Company Conversion and a Company Redemption so long as the entire amount of such Installment Amount due shall be converted and/or redeemed by the Company on the applicable Installment Date. The 2014 Company Note matured fifteen months after the Issuance Date. As of December 31, 2015, $311,815 of principal and accrued interest of $1,041 is outstanding on the 2014 Company Note. On January 19, 2016, the Company accepted and agreed to a Debt Purchase Agreement (the “DPA”), whereby LG Capital Funding, LLC (“LG”) acquired $157,500 of the Tonaquint 2014 Convertible Note in exchange for $75,000. The Company issued an 8% Replacement Note to LG for $157,500 (the “First Replacement Note”). The First Replacement Note was due January 19, 2017 and was convertible into shares of the Company’s common stock at any time at the discretion of LG at a variable conversion price (“VCP”). The VCP is calculated as the lowest trading price during the eighteen (18) trading days immediately prior to the conversion date multiplied by fifty eight percent (58%), representing a forty two percent (42%) discount. On January 19, 2016, the Company recorded a debt discount on the note of $157,500 and for the year ended December 31, 2016 recorded amortization expense of $151,813. The principal and interest balance of the First Replacement Note as of December 31, 2016, was $157,500 and $12,145, respectively. During the year ended December 31, 2017, the Company issued 12,268,244 shares of common stock upon the conversion of $157,500 of principal and $13,242 accrued and unpaid interest on the First Replacement Note. For the year ended December 31, 2017, the Company recorded amortization expense of $5,687 on the remaining amount of the debt discount. The shares were issued at approximately $0.014 per share. As of December 31, 2017, principal and interest were paid in full with stock, mentioned above, and the conversions occurred within the terms of the note agreement, as such, no gain or loss was recognized upon the conversion. On January 19, 2016, the Company accepted and agreed to a DPA, whereby Cerberus Finance Group, LTD (“Cerberus”) acquired $154,315 of principal and $2,434 of accrued and unpaid interest of the Tonaquint 2014 Convertible Note in exchange for $75,000. The Company issued an 8% Replacement Note to Cerberus for $156,749 (the “Second Replacement Note”). The Second Replacement Note was due January 19, 2017 and was convertible into shares of the Company’s common stock at any time at the discretion of LG at a VCP. The VCP is calculated as the lowest trading price during the eighteen (18) trading days immediately prior to the conversion date multiplied by fifty eight percent (58%), representing a forty two percent (42%) discount. On January 19, 2016, the Company recorded a debt discount on the note of $156,749 and for the year ended December 31, 2016 recorded amortization expense of $151,432. During the year ended December 31, 2016, the Company issued 13,129,683 shares of common stock upon the conversion of $9,500 of principal and $400 accrued and unpaid interest on the Second Replacement Note. The shares were issued at approximately $0.000754 per share. The principal and interest balance of the Second Replacement Note as of December 31, 2016, was $147,249 and $11,617, respectively. During the year ended December 31, 2017, the Company issued 11,059,977 shares of common stock upon the conversion of $147,249 of principal and $11,749 accrued and unpaid interest on the Second Replacement Note. For the year ended December 31, 2017, the Company recorded amortization expense of $5,317 on the remaining amount of the debt discount. The shares were issued at approximately $0.0144 per share. As of December 31, 2017, principal and interest were paid in full with stock, mentioned above, and the conversions occurred within the terms of the note agreement, as such, no gain or loss was recognized upon the conversion. 2016 Convertible Notes On January 19, 2016, the Company completed the closing of a private placement financing transaction with LG, pursuant to a Securities Purchase Agreement (the “LG Purchase Agreement”). Pursuant to the LG Purchase Agreement, LG purchased an 8% Convertible Debenture (the “LG Debenture”) in the aggregate principal amount of $76,080, and delivered on January 31, 2016, gross proceeds of $62,500 excluding transaction costs, fees, and expenses. The Company recorded a debt discount of $76,080 and during the year ended December 31, 2016, recorded amortization expense of $72,911. The principal and interest balance of the note as of December 31, 2016 was $76,080 and $5,833, respectively. During the year ended December 31, 2017, the Company issued 28,295,680 shares of common stock upon the conversion of $76,080 of principal and $4,752 accrued and unpaid interest on the note. The shares were issued at approximately $0.0097 per share. During the year ended December 31, 2017, the Company recorded amortization expense of $3,170 for the remaining portion of the debt discount. As of December 31, 2017, principal and interest were paid in full with stock, mentioned above, and the conversions occurred within the terms of the note agreement, as such, no gain or loss was recognized upon the conversion. On January 19, 2016, the Company also issued a back end note to LG, under the same terms and conditions, in the amount of $65,625. The back-end note was funded July 14, 2016, upon the receipt of $62,500, excluding transaction costs, fees and expenses. The Company recorded a debt discount of $65,625 and during the year ended December 31, 2016, recorded amortization expense of $47,396. The principal and interest balance of the note as of December 31, 2016 was $65,625 and $2,465, respectively. During the year ended December 31, 2017, the Company issued 5,432,726 shares of common stock upon the conversion of $65,625 of principal and $3,698 accrued and unpaid interest on the note. The shares were issued at approximately $0.01276 per share. During the year ended December 31, 2017, the Company recorded amortization expense of $34,818 for the remaining portion of the debt discount. As of December 31, 2017, principal and interest were paid in full with stock, mentioned above, and the conversions occurred within the terms of the note agreement, as such, no gain or loss was recognized upon the conversion. On January 19, 2016, the Company completed the closing of a private placement financing transaction with Cerberus, pursuant to a Securities Purchase Agreement (the “Cerberus Purchase Agreement”). Pursuant to the Cerberus Purchase Agreement, Cerberus purchased an 8% Convertible Debenture (the “Cerberus Debenture”) in the aggregate principal amount of $34,775, and delivered on January 25, 2016, gross proceeds of $25,000 excluding transaction costs, fees, and expenses. The Company recorded a debt discount of $34,475 and during the year ended December 31, 2016, recorded amortization expense of $32,843. The principal and interest balance of the note as of December 31, 2016 was $34,775 and $2,496, respectively. During the year ended December 31, 2017, the Company issued 2,953,523 shares of common stock upon the conversion of $34,775 of principal and $3,255 accrued and unpaid interest on the note. The shares were issued at approximately $0.01287 per share. During the year ended December 31, 2017, the Company recorded amortization expense of $1,982 for the remaining portion of the debt discount. As of December 31, 2017, principal and interest were paid in full with stock, mentioned above, and the conversions occurred within the terms of the note agreement, as such, no gain or loss was recognized upon the conversion. On January 19, 2016, the Company also issued a back-end note to Cerberus, under the same terms and conditions, in the amount of $22,000. The back-end note was funded August 1 upon receipt of $20,000, excluding transaction costs, fees and expenses. The Company recorded a debt discount of $22,000 and during the year ended December 31, 2016, recorded amortization expense of $17,294. The principal and interest balance of the note as of December 31, 2016 was $22,000 and $743, respectively. During the year ended December 31, 2017, the Company issued 4,264,903 shares of common stock upon the conversion of $22,000 of principal and $1,500 accrued and unpaid interest on the note. The shares were issued at approximately $0.00551 per share. During the year ended December 31, 2017, the Company recorded amortization expense of $4,706 for the remaining portion of the debt discount. As of December 31, 2017, principal and interest were paid in full with stock, mentioned above, and the conversions occurred within the terms of the note agreement, as such, no gain or loss was recognized upon the conversion. On March 23, 2016, the Company completed the closing of a private placement financing transaction with Cerberus, pursuant to a Securities Purchase Agreement (the “Cerberus Purchase Agreement”). Pursuant to the Cerberus Purchase Agreement, Cerberus purchased an 8% Convertible Debenture (the “Cerberus Debenture”) in the aggregate principal amount of $22,000, and delivered on March 31, 2016, gross proceeds of $20,000 excluding transaction costs, fees, and expenses. The Company recorded a debt discount of $22,000 and during the year ended December 31, 2016, recorded amortization expense of $16,989. The principal and interest balance of the note as of December 31, 2016 was $22,000 and $1,271, respectively. During the year ended December 31, 2017, the Company issued 3,023,338 shares of common stock upon the conversion of $22,000 of principal and $2,199 accrued and unpaid interest on the note. The shares were issued at approximately $0.008 per share. During the year ended December 31, 2017, the Company recorded amortization expense of $5,011 for the remaining portion of the debt discount. As of December 31, 2017, principal and interest were paid in full with stock, mentioned above, and the conversions occurred within the terms of the note agreement, as such, no gain or loss was recognized upon the conversion. On April 15, 2016, the Company completed the closing of a private placement financing transaction with LG, pursuant to a Securities Purchase Agreement (the “LG Purchase Agreement”). Pursuant to the LG Purchase Agreement, LG purchased an 8% Convertible Debenture (the “LG Debenture”) in the aggregate principal amount of $65,625, and delivered on April 15, 2016, gross proceeds of $62,500 excluding transaction costs, fees, and expenses. The Company recorded a debt discount of $65,625 and during the year ended December 31, 2016, recorded amortization expense of $47,396. The principal and interest balance of the note as of December 31, 2016 was $65,625 and $3,792, respectively. During the year ended December 31, 2017, the Company issued 12,718,484 shares of common stock upon the conversion of $65,625 of principal and $6,535 accrued and unpaid interest on the note. The shares were issued at approximately $0.0057 per share. During the year ended December 31, 2017, the Company recorded amortization expense of $18,229 for the remaining portion of the debt discount. As of December 31, 2017, principal and interest were paid in full with stock, mentioned above, and the conversions occurred within the terms of the note agreement, as such, no gain or loss was recognized upon the conversion. On October 14, 2016, the Company completed the closing of a private placement financing transaction with LG, pursuant to a Securities Purchase Agreement (the “LG Purchase Agreement”). Pursuant to the LG Purchase Agreement, LG purchased an 8% Convertible Debenture (the “LG Debenture”) in the aggregate principal amount of $32,813, and delivered on October 14, 2016, gross proceeds of $30,813 excluding transaction costs, fees, and expenses. The Company recorded a debt discount of $30,813 and during the year ended December 31, 2016, recorded amortization expense of $6,676. The principal and interest balance of the note as of December 31, 2016 was $32,813 and $569, respectively. During the year ended December 31, 2017, the Company issued 6,499,359 shares of common stock upon the conversion of $32,813 of principal and $2,999 accrued and unpaid interest on the note. The shares were issued at approximately $0.00551 per share. During the year ended December 31, 2017, the Company recorded amortization expense of $24,137 for the remaining portion of the debt discount. As of December 31, 2017, principal and interest were paid in full with stock, mentioned above, and the conversions occurred within the terms of the note agreement, as such, no gain or loss was recognized upon the conversion. On October 31, 2016, the Company entered into a Convertible Promissory Note ("St. George 2016 Notes") for $555,000 to St. George Investments, LLC. (“St. George”) which includes a purchase price of $500,000 and transaction costs of $5,000 and OID interest of $50,000. On October 31, 2016, the Company received $100,000 and recorded $115,000 as convertible note payable, including $5,000 of transaction costs and $10,000 OID interest. St. George also issued to the Company eight secured promissory notes, each in the amount of $50,000. All or any portion of the outstanding balance of the St. George 2016 Notes may be prepaid, without penalty, along with accrued but unpaid interest at any time prior to maturity. The Company has no obligation to pay St. George any amounts on the unfunded portion of the St. George 2016 Notes. The St. George 2016 Note bears interest at 10% per annum (increases to 22% per annum upon an event of default) and is convertible into shares of the Company’s common stock at St. George’s option at a price of $0.05 per share. On December 14, 2016, St. George funded one of the secured promissory notes issued to the Company. During the year ended December 31, 2016, the Company recorded debt discounts of $150,000 and during the year ended December 31, 2016, recorded amortization expense of $25,416. The principal and interest balance of the note as of December 31, 2016 was $170,000 and $1,933, respectively. During the year ended December 31, 2017, St. George funded the remaining secured promissory notes issued to the Company. During the year ended December 31, 2017, the Company recorded debt discounts of $350,000 and during the year ended December 31, 2017, recorded amortization expense of $474,584. During the year ended December 31, 2017, the Company issued 46,631,979 shares of common stock upon the conversion of $241,756 of principal and $21,249 accrued and unpaid interest on the note. The shares were issued at approximately $0.00564 per share. The principal and interest balance of the note as of December 31, 2017, was $313,244 and $1,946, respectively. Beginning on the date that is six (6) months after the later of (i) the Issuance Date, and (ii) the date the Initial Cash Purchase Price is paid to the Company (the “Initial Installment Date”), and on each applicable Installment Date thereafter, the Company is to pay the Holder, the applicable Installment Amount due on such date. Five Installment Amounts of $111,000 plus the sum of any accrued and unpaid interest, fees, costs or charges may be made (a) in cash (a “Company Redemption”), (b) by converting such Installment Amount into shares of Common Stock (a “Company Conversion”), or (c) by any combination of a Company Conversion and a Company Redemption so long as the entire amount of such Installment Amount due shall be converted and/or redeemed by the Company on the applicable Installment Date. The St. George 2016 Note matures fifteen months after the Issuance Date. On December 15, 2016, the Company completed the closing of a private placement financing transaction with LG, pursuant to a Securities Purchase Agreement (the “LG Purchase Agreement”). Pursuant to the LG Purchase Agreement, LG purchased an 8% Convertible Debenture (the “LG Debenture”) in the aggregate principal amount of $32,813, and delivered on December 15, 2016, gross proceeds of $30,813 excluding transaction costs, fees, and expenses. During the year ended December 31, 2016, the Company recorded a debt discount of $32,813 and during the year ended December 31, 2016, recorded amortization expense of $1,369. The principal and interest balance of the note as of December 31, 2016 was $32,813 and $117, respectively. During the year ended December 31, 2017, the Company issued 5,980,387 shares of common stock upon the conversion of $32,813 of principal and $2,567 accrued and unpaid interest on the note. The shares were issued at approximately $0.005916 per share. During the year ended December 31, 2017, the Company recorded amortization expense of $29,443 for the remaining portion of the debt discount. As of December 31, 2017, principal and interest were paid in full with stock, mentioned above, and the conversions occurred within the terms of the note agreement, as such, no gain or loss was recognized upon the conversion. Also, on December 15, 2016, the Company issued to LG, a back-end note under the same terms and conditions, in the amount of $32,813. On September 28, 2017, the back-end note was funded upon receipt of $30,813, excluding transaction costs, fees, and expenses. During the year ended December 31, 2017, the Company recorded a debt discount of $30,813 and during the year ended December 31, 2017, recorded amortization expense of $30,813. During the year ended December 31, 2017, the Company issued 5,793,378 shares of common stock upon the conversion of $32,813 of principal and $453 accrued and unpaid interest on the note. The shares were issued at approximately $0.005742 per share. As of December 31, 2017, principal and interest were paid in full with stock, mentioned above, and the conversions occurred within the terms of the note agreement, as such, no gain or loss was recognized upon the conversion. Principal and interest on the above LG and Cerberus convertible debentures is due and payable one year from their respective funding date, and the LG and Cerberus Debentures are convertible into shares of the Company’s common stock at any time at the discretion of LG and Cerberus, respectively, at a VCP. The VCP is calculated as the lowest trading price during the eighteen (18) trading days immediately prior to the conversion date multiplied by fifty eight percent (58%), representing a forty two percent (42%) discount. The Company determined that the conversion feature of the 2016 Convertible Notes represent an embedded derivative since the Notes are convertible into a variable number of shares upon conversion. Accordingly, the 2016 Convertible Notes were not considered to be conventional debt under ASC 815-40 (formerly EITF 00-19, Accounting for Derivative Financial Instruments Indexed to, and Potentially Settled in, a Company’s Own Stock) and the embedded conversion feature was bifurcated from the debt host and accounted for as a derivative liability. Accordingly, the fair value of these derivative instruments being recorded as a liability on the consolidated balance sheet with the corresponding amount recorded as a discount to each Note. Such discount is being amortized from the date of issuance to the maturity dates of the Notes. The change in the fair value of the liability for derivative contracts are recorded in other income or expenses in the consolidated statements of operations at the end of each quarter, with the offset to the derivative liability on the balance sheet. The embedded feature included in the 2016 Convertible Notes resulted in an initial debt discount of $865,593, an initial derivative liability expense of $2,317,830 and an initial derivative liability of $3,183,423. Amortization of debt discount on the notes issued in 2016 was $257,033 and $608,560 for the years ended December 31, 2017 and 2016, respectively. 2017 Convertible Notes On January 24, 2017, the Company completed the closing of a private placement financing transaction with LG, pursuant to a Securities Purchase Agreement (the “LG Purchase Agreement”). Pursuant to the LG Purchase Agreement, LG purchased an 8% Convertible Debenture (the “LG Debenture”) in the aggregate principal amount of $94,500, and delivered on January 25, 2017, gross proceeds of $90,000 excluding transaction costs, fees, and expenses. During the year ended December 31, 2017, the Company recorded a debt discount of $90,000 and during the year ended December 31, 2017, recorded amortization expense of $90,000. During the year ended December 31, 2017, the Company issued 17,440,037 shares of common stock upon the conversion of $94,500 of principal and $6,051 accrued and unpaid interest on the note. The shares were issued at approximately $0.00577 per share. As of December 31, 2017, principal and interest were paid in full with stock, mentioned above, and the conversions occurred within the terms of the note agreement, as such, no gain or loss was recognized upon the conversion. As of December 31, 2017, principal and interest were paid in full with stock, mentioned above, and the conversions occurred within the terms of the note agreement, as such, no gain or loss was recognized upon the conversion. On January 24, 2017, the Company completed the closing of a private placement financing transaction with Cerberus, pursuant to a Securities Purchase Agreement (the “Cerberus Purchase Agreement”). Pursuant to the Cerberus Purchase Agreement, Cerberus purchased an 8% Convertible Debenture (the “Cerberus Debenture”) in the aggregate principal amount of $63,000, and delivered on January 25, 2017, gross proceeds of $60,000 excluding transaction costs, fees, and expenses. During the year ended December 31, 2017, the Company recorded a debt discount of $60,000 and during the year ended December 31, 2017, recorded amortization expense of $60,000. During the year ended December 31, 2017, the Company issued 11,586,452 shares of common stock upon the conversion of $63,000 of principal and $3,357 accrued and unpaid interest on the note. The shares were issued at approximately $0.00573 per share. As of December 31, 2017, principal and interest were paid in full with stock, mentioned above, and the conversions occurred within the terms of the note agreement, as such, no gain or loss was recognized upon the conversion. On February 1, 2017, the Company completed the closing of a private placement financing transaction with Power Up Lending Group, LTD (“Power Up”), pursuant to a Securities Purchase Agreement (the “Power Up Purchase Agreement”). Pursuant to the Power Up Purchase Agreement, Power Up purchased an 12% Convertible Debenture (the “Power Up Debenture”) in the aggregate principal amount of $140,000, and delivered on February 3, 2017 (the “Funding Date”), gross proceeds of $136,500 excluding transaction costs, fees, and expenses. Principal and interest on the Power Up Debentures is due and payable on November 5, 2017, and the Power Up Debenture is convertible into shares of the Company’s common stock beginning six months from the Funding Date, at a VCP. The VCP is calculated as the average of the three (3) lowest closing bid price during the ten (10) trading days immediately prior to the conversion date multiplied by fifty eight percent (58%), representing a forty two percent (42%) discount. During the year ended December 31, 2017, the Company recorded a debt discount of $136,500 and during the year ended December 31, 2017, recorded amortization expense of $136,500. The Company may prepay the Power Up Debenture, subject to prior notice to the holder within an initial 30-day period after issuance, by paying an amount equal to 120% multiplied by the amount that the Company is prepaying. For each additional 30-day period the amount being prepaid is multiplied by an additional 5%, up to a maximum of 140% on the 180 th th On February 24, 2017, the Company completed the closing of a private placement financing transaction with LG. Pursuant to the LG Purchase Agreement, LG purchased an 8% Convertible Debenture in the aggregate principal amount of $26,000, and delivered on February 24, 2017, gross proceeds of $24,000 excluding transaction costs, fees, and expenses. During the year ended December 31, 2017, the Company recorded a debt discount of $24,000 and during the year ended December 31, 2017, recorded amortization expense of $24,000. On December 29,2017, the Company paid LG $35,421 to redeem the note, including $7,723 of excess over principal and interest due. As of December 31, 2017, principal and interest were paid in full with stock, mentioned above, and the conversions occurred within the terms of the note agreement, as such, no gain or loss was recognized upon the conversion. On February 24, 2017, the Company completed the closing of a private placement financing transaction with Cerberus, pursuant to a Securities Purchase Agreement (the “Cerberus Purchase Agreement”). Pursuant to the Cerberus Purchase Agreement, Cerberus purchased an 8% Convertible Debenture (the “Cerberus Debenture”) in the aggregate principal amount of $17,500, and delivered on February 27, 2017, gross proceeds of $16,000 excluding transaction costs, fees, and expenses. During the year ended December 31, 2017, the Company recorded a debt discount of $16,000 and during the year ended December 31, 2017, recorded amortization expense of $13,644. The principal and interest balance of the note as of December 31, 2017 was $17,500 and $1,206, respectively. Also, on February 24, 2017, the Company issued to Cerberus, a back-end note under the same terms and conditions, in the amount of $17,500. On December 7, 2017, the back-end note was funded upon receipt of $16,000, excluding transaction costs, fees, and expenses. During the year ended December 31, 2017, the Company recorded a debt discount of $16,000 and during the year ended December 31, 2017, recorded amortization expense of $4,861. The principal and interest balance of the back-end note as of December 31, 2017 was $17,500 and $80, respectively. On March 24, 2017, the Company completed the closing of a private placement financing transaction with LG. Pursuant to the LG Purchase Agreement, LG purchased an 8% Convertible Debenture in the aggregate principal amount of $52,000, and delivered on March 28, 2017, gross proceeds of $49,600 excluding transaction costs, fees, and expenses. During the year ended December 31, 2017, the Company recorded a debt discount of $49,400 and during the year ended December 31, 2017, recorded amortization expense of $49,400. On December 29,2017, the Company paid LG $70,376 to redeem the note, including $15,344 of excess over principal and interest due. The principal balance of the note as of December 31, 2017 was $-0-. Also, on March 24, 2017, the Company issued to LG, a back-end note under the same terms and conditions, in the amount of $52,000. On September 28, 2017, the back-end note was funded upon receipt of $49,600, excluding transaction costs, fees, and expenses. During the year ended December 31, 2017, the Company recorded a debt discount of $49,400 and during the year ended December 31, 2017, recorded amortization expense of $49,400. During the year ended December 31, 2017, the Company issued 8,939,991 shares of common stock upon the conversion of $52,000 of principal and $889 accrued and unpaid interest on the note. The shares were issued at approximately $0.00592 per share. As of December 31, 2017, principal and interest were paid in full with stock, mentioned above, and the conversions occurred within the terms of the note agreement, as such, no gain or loss was recognized upon the conversion. On April 24, 2017, the Company completed the closing of a private placement financing transaction with Cerberus, pursuant to a Securities Purchase Agreement (the “Cerberus Purchase Agreement”). Pursuant to the Cerberus Purchase Agreement, Cerberus purchased an 8% Convertible Debenture (the “Cerberus Debenture”) in the aggregate principal amount of $42,000, and delivered on May 3, 2017, gross proceeds of $40,000 excluding transaction costs, fees, and expenses. During the year ended December 31, 2017, the Company recorded a debt discount of $40,000 and during the year ended December 31, 2017, recorded amortization expense of $40,000. During the year ended December 31, 2017, the Company issued 6,570,945 shares of common stock upon the conversion of $42,000 of principal and $2,209 accrued and unpaid interest on the note. The shares were issued at approximately $0.00673 per share. As of December 31, 2017, principal and interest were paid in full with stock, mentioned above, and the conversions occurred within the terms of the note agreement, as such, no gain or loss was recognized upon the conversion. On May 24, 2017, the Company completed the closing of a private placement financing transaction with LG. Pursuant to the LG Purchase Agreement, LG purchased an 8% Convertible Debenture in the aggregate principal amount of $52,000, and delivered on May 24, 2017, gross proceeds of $49,600 excluding transaction costs, fees, and expenses. During the year ended December 31, 2017, the Company recorded a debt discount of $49,400 and during the year ended December 31, 2017, recorded amortization expense of $49,400. On December 29,2017, the Company paid LG $69,545 to redeem the note, including $15,163 of excess over principal and interest due. The principal balance of the note as of December 31, 2017 was $-0-. Also, on May 24, 2017, the Company issued to LG, a back-end note under the same terms and conditions, in the amount of $52,000. On December 4, 2017, the back-end note was funded upon receipt of $49,600, excluding transaction costs, fees, and expenses. During the year ended December 31, 2017, the Company recorded a debt discount of $49,400 and during the year ended December 31, 2017, recorded amortization expense of $49,400. On December 29,2017, the Company paid LG $66,718 to redeem the back-end note, including $14,547 of excess over principal and interest due. The principal balance of the back-end note as of December 31, 2017 was $-0-. On August 8, 2017, the Company completed the closing of a private placement financing transaction with Power Up, pursuant to a Securities Purchase Agreement (the “Power Up Purchase Agreement”). Pursuant to the Power Up Purchase Agreement, Power Up purchased an 12% Convertible Debenture (the “Power Up Debenture”) in the aggregate principal amount of $128,000, and delivered on August 9, 2017 (the “Funding Date”), gross proceeds of $125,000 excluding transaction costs, fees, and expenses. Principal and interest on the Power Up Debentures is due and payable on May 15, 2018, and the Power Up Debenture is convertible into shares of the Company’s common stock beginning six months from the Funding Date, at a VCP. The VCP is calculated as the average o |
Derivative liabilities
Derivative liabilities | 12 Months Ended |
Dec. 31, 2017 | |
Notes to Financial Statements | |
Derivative liabilities | Note 9 - Derivative liabilities As of December 31, 2017, the Company revalued the embedded conversion feature of the 2016 and 2017 Convertible Notes, and warrants (see note 11). The fair value of the 2016 and 2017 Convertible Notes and warrants was calculated at December 31, 2017 based on the Monte Carlo simulation method consistent with the terms of the related debt. A summary of the derivative liability balance as of December 31, 2017, is as follows: Notes Warrants Total Beginning Balance $ 1,410,647 $ 203,023 $ 1,613,670 Initial Derivative Liability 3,633,502 415,313 4,048,815 Fair Value Change 1,571,986 1,190,244 2,762,230 Reclassified to Additional paid- in capital (2,184,277 ) — (2,184,277 ) Reduction for debt assignment (823,610 ) — (823,610 ) Ending Balance $ 3,608,250 $ 1,808,580 $ 5,416,830 The embedded derivative within Warrant #’s 2 thru 9 (see Note 11) resulted in an initial derivative liability expense and an initial derivative liability of $415,313. The valuation of the embedded derivative within the effective warrants was recorded with an offsetting expense on derivative liabilities. The fair value at the commitment date for the 2017 Convertible Notes and the re-measurement dates for the Company’s derivative liabilities were based upon the following management assumptions as of December 31, 2017: Commitment date Remeasurement date Expected dividends -0- -0- Expected volatility 199%-361% 320%-331% Expected term 12 months 3-12 months Risk free interest .65%-1.78% 1.51%-1.79% The Company evaluated all outstanding warrants to determine whether these instruments may be tainted. All warrants outstanding were considered tainted. The Company valued the embedded derivatives within the warrants using the Black-Scholes valuation model. The fair value at the funding date for Warrant #’s 2-9 and the re-measurement dates for Warrant #’s 1-9 were based upon the following management assumptions: Commitment date Remeasurement date Expected dividends -0- -0- Expected volatility 203% - 384% 320% Expected term 3.87 - 4.64 years 3.84 years Risk free interest 1.72% - 2.05% 1.81% The Company determined that the conversion feature of the 2016 Convertible Notes represent an embedded derivative since the Notes are convertible into a variable number of shares upon conversion. Accordingly, the 2016 Convertible Notes were not considered to be conventional debt under ASC 815-40 (formerly EITF 00-19, Accounting for Derivative Financial Instruments Indexed to, and Potentially Settled in, a Company’s Own Stock) and the embedded conversion feature was bifurcated from the debt host and accounted for as a derivative liability. Accordingly, the fair value of these derivative instruments being recorded as a liability on the consolidated balance sheet with the corresponding amount recorded as a discount to each Note. Such discount is being amortized from the date of issuance to the maturity dates of the Notes. The change in the fair value of the liability for derivative contracts are recorded in other income or expenses in the consolidated statements of operations at the end of each quarter, with the offset to the derivative liability on the balance sheet. The embedded feature included in the 2016 Convertible Notes resulted in an initial debt discount of $865,593, an initial derivative liability expense of $2,317,830 and an initial derivative liability of $3,183,423. As of December 31, 2016, the Company revalued the embedded conversion feature of the 2015 and 2016 Convertible Notes. The fair value of the 2015 and 2016 Convertible Notes was calculated at December 31, 2016 based on the Black Scholes method consistent with the terms of the related debt. A summary of the derivative liability balance as of December 31, 2016 is as follows: Beginning Balance $ 167,014 Initial Derivative Liability 4,114,649 Fair Value Change (1,791,988 ) Debt extinguishment (84,057 ) Reduction for conversions (791,851 ) Ending Balance $ 1,613,767 The fair value at the commitment date for the 2016 Convertible Notes and the re-measurement dates for the Company’s derivative liabilities were based upon the following management assumptions as of December 31, 2016: Commitment date Remeasurement date Expected dividends -0- -0- Expected volatility 243%-268% 246% Expected term 12 months 1-12 months Risk free interest .44%-.68% .48%-.85% |
Related Party Transactions
Related Party Transactions | 12 Months Ended |
Dec. 31, 2017 | |
Related Party Transactions [Abstract] | |
Related Party Transactions | Note 10 – Related Party Transactions Effective January 1, 2013, the Company agreed to an annual compensation of $150,000 for its CEO, Mr. Michael Friedman (resigned March 20, 2015, re-appointed November 4, 2015). Effective March 20, 2015, Mr. Justin Braune was named CEO and President. Mr. Braune also was appointed to the Board of Directors. The Company agreed to an annual compensation of $100,000 for Mr. Braune in his role of CEO and Director of the Company and to issue Mr. Braune 15,000,000 shares of restricted common stock. Mr. Braune resigned from the board of directors and as CEO on November 4, 2015, and agreed to cancel the 15,000,000 shares in his letter of resignation. The Company also initially issued Mr. Braune 12,500,000 shares of common stock on October 13, 2015. On October 16, 2015, Mr. Braune advised the Company’s transfer agent at the time to cancel the shares. The Company’s transfer agent has not canceled the shares, and accordingly, as of December 31, 2017, the shares are included in the outstanding shares of the Company. Management has requested that the transfer agent cancel the shares. For the years ended December 31, 2017 and 2016, the Company recorded expenses of $150,000 to the CEO, included in Management Fees in the consolidated statements of operations, included herein. As of December 31, 2017, and 2016, the Company owed the CEO $7,715 and $54,246, respectively, and is included in due to related party on the Company’s consolidated balance sheet. On January 30, 2017, the Company issued 10,000,000 shares of common stock to the Company’s CEO. The shares were issued for services performed as the sole Officer and director of the Company since November 2014. The shares were valued at $301,000 ($0.0301 per share, the market price of the common stock on the grant date) and are included in Management Fees in the consolidated statements of operations, included herein. On April 14, 2015, the Company appointed Dr. Stephen Holt to the Advisory Board of the Board of Directors of the Company. The Company issued 5,000,000 shares of restricted common stock to Dr. Holt for his appointment. Additionally, the Company agreed the advisor shall receive a non-qualified stock option to purchase 1,000,000 shares (“Option Shares”) of the Company’s common stock at an exercise price equal to $0.05 per share. 400,000 Option Shares vested immediately and the remaining 600,000 Option Shares vested over 12 months. Accordingly, the Company has recorded $2,371 for the year ended December 31, 2016, in stock compensation expense and all of the options have vested. On October 5, 2017, the Company agreed to lease from the Company’s CEO, a "420 Style" resort and estate property approximately one hour outside of Quebec City, Canada. The fifteen-acre estate consists of nine (9) unique guest suites, horse stables, and is within walking distance to a public golf course. A separate structure will serve as a small grow facility run by patient employees and caretakers on the property which may be toured by guests of the facility. Pursuant to the agreement, the Company will pay $8,000 per month in exchange for the Company being entitled to all rents and income generated from the property. The Company will be responsible for all costs of the property, including, but not limited to, renovations, repairs and maintenance, insurance and utilities. On August 8, 2017, the Company issued 5,000,000 shares of common stock to the seller. The Company valued the shares at $0.0123 per share (the market price of the common stock) and has included $61,500 in stock- based compensation expense for the year ended December 31, 2017. The Company purchased from the previous owner furniture and fixtures for $96,000. As of December 31, 2017, the Company has not received any rents from the property, as it is renovating the house. A mounts Due from 800 Commerce, Inc. 800 Commerce, Inc., a commonly controlled entity until February 29, 2016, owed Agritek $282,947 as of February 29, 2016, as a result of advances received from or payments made by Agritek on behalf of 800 Commerce. These advances were non-interest bearing and were due on demand. Effective February 29, 2016, the Company received 1,102,462 shares of common stock of Petrogress, Inc. (formerly known as 800 Commerce, Inc.) as settlement of the $282,947 owed to the Company. |
Common and Preferred Stock
Common and Preferred Stock | 12 Months Ended |
Dec. 31, 2017 | |
Equity [Abstract] | |
Common and Preferred Stock | Note 11 – Common and Preferred Stock C ommon Stock 2017 Issuances During the year ended December 31, 2017, the Company issued the following shares of common stock upon the conversions of portions of the convertible notes: Date Principal Conversion Interest Conversion Total Conversion Conversion Price Shares Issued Issued to 1/10/17 $ 73,000 $ 5,664 $ 78,664 $ 0.01595 4,931,912 Cerberus 1/17/17 $ 57,500 $ 4,562 $ 62,062 $ 0.01537 4,037,878 LG 1/27/17 $ 48,129 $ 3,914 $ 52,043 $ 0.01276 4,078,598 Cerberus 2/8/17 $ 60,000 $ 5,050 $ 65,050 $ 0.012934 5,029,369 LG 2/27/17 $ 26,120 $ 2,171 $ 28,291 $ 0.013804 2,049,467 Cerberus 3/10/17 $ 40,000 $ 3,630 $ 43,630 $ 0.01363 3,200,997 LG 3/27/17 $ 34,775 $ 3,255 $ 38,030 $ 0.012876 2,953,523 Cerberus 3/28/17 $ 65,625 $ 3,697 $ 69,322 $ 0.01276 5,432,725 LG 4/25/17 $ 76,081 $ 4,752 $ 80,833 $ 0.009744 8,295,680 LG 5/10/17 $ 22,000 $ 2,199 $ 24,199 $ 0.008 3,023,338 Cerberus 5/10/17 $ 20,640 $ 9,360 $ 30,000 $ 0.0075 4,000,000 St Georges 5/25/17 $ 29,052 $ 947 $ 30,000 $ 0.00564 5,319,149 St Georges 6/6/17 $ 32,813 $ 2,999 $ 35,811 $ .00551 6,499,359 LG 6/8/17 $ 34,100 $ 900 $ 35,000 $ 0.00564 6,205,674 St Georges 6/9/17 $ 22,000 $ 1,500 $ 23,500 $ 0.00551 4,264,903 Cerberus 6/29/17 $ 48,849 $ 1,151 $ 50,000 $ .00564 8,865,248 St Georges 6/30/17 $ 30,625 $ 2,960 $ 33,585 $ 0.0058 5,790,541 LG 7/17/17 $ 37,358 $ 733 $ 38,091 $ 0.00564 6,753,817 St Georges 7/25/17 $ 35,000 $ 3,575 $ 38,575 $ 0.005568 6,927,943 LG 7/26/17 $ 28,000 $ 1,117 $ 29,117 $ 0.005568 5,229,334 Cerberus 8/15/17 $ 35,199 $ 409 $ 35,608 $ 0.0058 6,139,276 LG 8/29/17 $ 38,000 $ 558 $ 38,558 $ 0.005858 6,582,115 LG 9/19/17 $ 34,500 $ 665 $ 35,165 $ 0.008178 4,300,002 LG 10/9/17 $ 30,000 $ 710 $ 30,710 $ 0.007076 4,340,042 LG 10/23/17 $ 30,000 $ 802 $ 30,802 $ 0.006090 5,057,830 LG 11/6/17 $ 28,376 $ 6,624 $ 35,000 $ 0.005640 6,205,674 St Georges 11/6/17 $ 19,500 $ 1,218 $ 20,718 $ 0.005858 3,536,715 LG 11/13/17 $ 35,000 $ 2,240 $ 37,240 $ 0.005858 6,357,118 Cerberus 11/14/17 $ 26,624 $ 428 $ 27,052 $ 0.005640 4,796,452 St Georges 11/15/17 $ 75.000 $ 4,833 $ 79,833 $ 0.005742 13,903,322 LG 12/1/17 $ 32,813 $ 453 $ 33,266 $ 0.005742 5,793,378 LG 12/5/17 $ 16,756 $ 1,105 $ 17,861 $ 0.005640 3,166,816 St Georges 12/7/17 $ 32,813 $ 2,567 $ 35,380 $ 0.005916 5,980,387 LG 12/15/17 $ 52,000 $ 889 $ 52,889 $ 0.005916 8,939,991 LG 12/28/17 $ 42,000 $ 2,209 $ 44,209 $ 0.006728 6,570,945 Cerberus $ 1,350,247 $ 89,846 $ 1,440,093 194,559,520 In addition to the above, during the year ended December 31, 2017, the Company: On January 16, 2017, the Company entered into a Business Consultant Agreement (the “BCA”). Pursuant to the BCA, the Company issued 5,000,000 shares of common stock for services to be provided to the Company related to business development, product marketing, helping identify mergers and acquisition candidates, and will consult with and advise the Company on matters pertaining to business modeling and strategic alliances. The Company valued the shares at $0.0267 per share (the market price of the common stock) and recorded stock compensation expense for the year ended December 31, 2017, of $133,500. On January 27, 2017, the Company issued 1,000,000 shares of restricted common stock to Kopelowitz Ostrow P.A. (“ KO On January 30, 2017, the Company issued 1,000,000 shares of common stock to Venture Equity. The Company valued the shares at $0.03 per share (the market price of the common stock) and cancelled of $13,169 of accrued and unpaid fees owed Venture Equity and recorded a loss on the settlement of accounts payable for the year ended December 31, 2017, of $16,831. Also, on January 30, 2017, the Company issued 10,000,000 shares of common stock to the Company’s CEO. The shares were issued for services performed as the sole Officer and director of the Company since November 2014. The Company valued the shares at $0.0301 per share (the market price of the common stock) and for the year ended December 31, 2017, recorded stock compensation expense, management, of $301,000. On June 19, 2017, the Company issued 1,319,149 shares of common stock valued at $16,094 to St. George pursuant to the “true-up” terms and conditions of the St. George note. On August 8, 2017, the Company issued 2,000,000 shares of common stock for compensation for services of the Company’s chief operating officer. The Company valued the shares at $0.0123 per share (the market price of the common stock) and for the year ended December 31, 2017, recorded stock compensation expense, management, of $24,600. On August 8, 2017, the Company issued 5,000,000 shares of common stock for the property known as the "420 Style" resort and estate, located in Canada (see note 11). The Company valued the shares at $0.0123 per share (the market price of the common stock) and has included $61,500 in stock- based compensation expense for the year ended December 31, 2017. During the year ended December 31, 2017, the Company issued 87,934,231 shares of common stock to St. George pursuant to Notices of Exercise of Warrant received. The shares were issued based upon the cashless exercise provision of the warrant. During the year ended December 31, 2017, the Company recorded 15,000,000 shares of common stock to Mr. Braune (see Note 10) that have been included in the Company’s transfer agent’s records despite Mr. Braune’s request to the transfer agent of record at the time to cancel the shares. The Company had previously removed the shares from its records. 2016 Issuances During the year ended December 31, 2016, the Company issued the following shares of common stock upon the conversions of portions of the 2014 Company Note and portions of the 2015 Convertible Notes: Date Principal Conversion Interest Conversion Total Conversion Shares Issued to 12/28/16 $ 45,000 $ 3,511 $ 48,511 $ 0.015080 3,216,925 LG 12/13/16 $ 9,500 $ 400 $ 9,900 $ 0.000754 13,129,683 Cerberus 9/26/16 $ 8,613 $ 629 $ 9,242 $ 0.001218 7,587,824 LG 7/29/16 $ 7,500 $ 801 $ 8,301 $ 0.000081 10,222,352 LG 7/20/16 $ 9,500 $ 995 $ 10,495 $ 0.000098 10,644,310 LG 7/12/16 $ 9,000 $ 927 $ 9,927 $ 0.000986 10,068,073 LG 7/1/16 $ 8,000 $ 805 $ 8,805 $ 0.001160 7,590,362 LG 6/22/16 $ 5,000 $ 973 $ 5,973 $ 0.001450 4,119,414 GW 6/20/16 $ 10,500 $ 1,003 $ 11,503 $ 0.001450 7,933,377 Cerberus 6/20/16 $ 5,000 $ 967 $ 5,967 $ 0.001450 4,114,879 GW 6/20/16 $ 6,000 $ 589 $ 6,589 $ 0.001450 4,544,241 LG 6/10/16 $ 6,075 $ 1,134 $ 7,209 $ 0.001798 4,009,701 GW 6/9/16 $ 5,000 $ 479 $ 5,479 $ 0.001798 3,047,219 LG 6/2/16 $ 9,000 $ 848 $ 9,848 $ 0.002378 4,141,387 Cerberus 5/23/16 $ 5,000 $ 460 $ 5,460 $ 0.002436 2,241,490 LG 3/17/16 $ 9,000 $ 696 $ 9,696 $ 0.002436 3,980,431 LG 3/17/16 $ 3,000 $ 138 $ 3,138 $ 0.000638 4,918,624 Service 3/8/16 $ 7,425 $ 928 $ 8,353 $ 0.00174 4,800,354 GW 3/7/16 $ 6,500 $ 489 $ 6,989 $ 0.00174 4,016,471 LG $ 174,613 $ 16,772 $ 191,385 114,327,117 In addition to the above during the year ended December 31, 2016, the Company: On November 7, 2016, the Company issued 5,000,000 shares of common stock and completed the stock purchase for the acquisition of Sterling Classic Compassion, LLC. (“Sterling”). The Company valued the shares at $0.081 per share (the market price of the common stock). Preferred Stock On June 26, 2015, the Company filed with the Delaware Secretary of State the Amended and Restated Designation Preferences and Rights (the “Certificate of Designation”) of Class B Preferred Stock (the “Series B Preferred Stock”). Pursuant to the Certificate of Designation, 1,000 shares constitute the Series B Preferred Stock. The Series B Preferred Stock and any accrued and unpaid dividends thereon shall, with respect to rights on liquidation, winding up and dissolution, rank senior to the Company’s issued and outstanding common stock and Series A preferred stock. The Series P e r S Warrants and Options On April 14, 2015, in connection with the appointment of Dr. Stephen Holt to the advisory board, the Company agreed the advisor shall receive a non-qualified stock option to purchase 1,000,000 shares (“Option Shares”) of the Company’s common stock at an exercise price equal to $0.05 per share and expiring April 14, 2018. Option Shares of 400,000 vested immediately and 50,000 Option Shares vested each month from April 2015 through March 2016. Accordingly, as of March 31, 2016, 1,000,000 Option Shares have vested and the Company recorded $2,317 as stock compensation expense for the year ended December 31, 2016, based on Black-Scholes. On April 26, 2013 and in connection with the appointment of Mr. James Canton to the Company’s advisory board, the Company issued a warrant to Mr. Canton to purchase 300,000 shares of common stock. The warrant expired April 26, 2016. On October 31, 2016, the Company granted (Warrant #1) to St. George the right to purchase at any time on or after November 10, 2016 (the “Issue Date”) until the date which is the last calendar day of the month in which the fifth anniversary of the Issue Date occurs (the “Expiration Date”), a number of fully paid and non-assessable shares (the “Warrant Shares”) of Company’s common stock, equal to $57,500 divided by the Market Price (defined below) as of the Issue Date, as such number may be adjusted from time to time pursuant to the terms and conditions of Warrant #1 to Purchase Shares of Common Stock. The Market Price is equal to the lowest intra-day trade price in the twenty (20) Trading Days immediately preceding the applicable date of exercise, multiplied by sixty percent (60%). The exercise price is the lower of $0.05 and is subject to price adjustments pursuant to the agreement and includes a cashless exercise provision. The Company also issued Warrant #’s 2-9, with each warrant only effective upon St. George funding of the secured notes they issued to the Company. Warrant #’s 2-9 give St. George the right to purchase Warrant Shares equal to $27,500 divided by the Market Price on the funded date. On December 14, 2016, the Company received a payment of $50,000, and accordingly, Warrant #2 became effective. During the year ended December 31, 2017, the Company received the funding on the remaining notes and Warrant #’s 3-9 became effective. During the year ended December 31, 2017, the company issued 87,934,231 shares of common stock to St. George pursuant to Notices of Exercise of 9,364,108 Warrants received. The shares were issued based upon the cashless exercise provision of the warrant. The following table summarizes the activity related to warrants of the Company for the years ended December 31, 2017 and 2016: Number of Warrants Weighted-Average Exercise Price per share Weighted-Average Remaining Life (Years) Outstanding at January 1, 2016 1,300,000 $ 0.05 3.00 Warrants issued 16,926,130 0.00564 Warrants expired (300,000 ) (0.05 ) Outstanding and exercisable at December 31, 2016 17,926,130 0.0811 4.88 Warrant issued 40,573,870 0.00564 Warrants exercised (9,364,108 ) 0.00564 Outstanding and exercisable at December 31, 2017 49,135,892 0.00654 4.17 |
Income Taxes
Income Taxes | 12 Months Ended |
Dec. 31, 2017 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | Note 12 – Income Taxes The Company accounts for income taxes under standards issued by the FASB. Under those standards, deferred tax assets and liabilities are recognized for future tax benefits or consequences attributable to temporary differences between the financial statement 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. A valuation allowance is provided for significant deferred tax assets when it is more likely than not that such assets will not be realized through future operations. No provision for federal income taxes has been recorded due to the available net operating loss carry forwards of approximately $491,107 will expire in various years through 2032. Future tax benefits which may arise as a result of these losses have not been recognized in these financial statements, as their realization is determined not likely to occur and accordingly, the Company has recorded a valuation allowance for the future tax loss carry forwards. The actual income tax provisions differ from the expected amounts calculated by applying the statutory income tax rate to the Company's loss before income taxes. The components of these differences are as follows at December 31, 2017, and 2016: 2017 2016 Net tax loss carry-forwards $ 7,878,733 $ 5,836,000 Statutory rate 37.6 % 37.6 % Expected tax recovery 2,962,404 2,194,336 Change in valuation allowance (2,962,404 ) (2,194,336 ) Income tax provision $ — $ — Components of deferred tax asset: Non capital tax loss carry forwards $ 2,962,404 $ 2,194,336 Less: valuation allowance (2,962,404 ) (2,194,336 ) Net deferred tax asset $ — $ — |
Commitments and Contingencies
Commitments and Contingencies | 12 Months Ended |
Dec. 31, 2017 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | Note 13 – Commitments and Contingencies Office Space In April 2014, the Company entered into a two-year sublease agreement for the use of up to 7,500 square feet with a Colorado based In December 2016, the Company signed a one-year lease for office space in San Juan, Puerto Rico. The lease requires monthly base rent of $800 for the months of December 2016 through February 2017, and $900 per month for the months of March 2017 through November 2017. In January 2017, the Company signed a five (5) year lease, beginning February 1, 2107, for approximately 6,000 square feet of office space, comprised of two floors, in San Juan, Puerto Rico. Pursuant to the lease, the Company will pay $3,000 per month for the third floor of the building for the first year of the lease. The rent will increase 3% per year on February beginning in 2018 and an additional 3% per year on each successive February 1, during the term of the lease. The landlord has agreed that for the month of February 2017, the rent will be $1,500. The rent for second floor of the building will be $2,000 per month during the term of the lease and the Company does not have any rent payments for the first three months of the lease (February 2017 through April 2017). Through September 30, 2017, the Company calculated the total amount of the rent for the term lease and recorded straight line rent expense of $45,417 and had made payments of $20,516. As of December 31, 2017, the Company has a balance of $24,916 in deferred rent which is included in the consolidated balance sheet. The leases for the second and third floor were cancelled in September 2017 as a result of Hurricane Irma. On December 1, 2016, the Company signed a one (1) year lease for a corporate apartment in Puerto Rico for $5,500 per month. This lease expired in November 30, 2017. Rent expense was $101,279 and $40,303, respectively, and for the years ended December 31 2017, and 2016, respectively. Leased Properties On April 28, 2014, the Company executed and closed a ten-year lease agreement for 20 acres of an agricultural farming facility located in South Florida following the approval of the so-called “Charlotte’s Web” legislation, aimed at decriminalizing low grade marijuana specifically for the use of treating epilepsy and cancer patients. Pursuant to the lease agreement, the Company maintains a first right of refusal to purchase the property for three years. The Company has recorded $38,244 of expense (included in leased property expenses) for the years ended December 31, 2017, and 2016, respectively. The Company is currently in default of the lease agreement, as rents have not been for the second year of the lease beginning May 2015. On July 11, 2014, the Company signed a ten-year lease agreement for an additional 40 acres in Pueblo, Colorado. The lease requires monthly rent payments of $10,000 during the first year and is subject to a 2% annual increase over the life of the lease. The lease also provides rights to 50 acres of certain tenant water rights for $50,000 annually plus cost of approximately $2,400 annually. The Company paid the $50,000 in July 2014, and has not used the property and any water and has not paid for any water rights after September 30, 2015. The Company has recorded $-0- of expense for the year ended December 31, 2017, and $76,650 for the year ended December 31, 2016, (included in leased property expenses). The Company is currently in default of the lease agreement, as rents have not been paid since February 2015. Agreements On April 5, 2017, the Company executed a five (5) year operational and exclusive licensing agreement with a third party who leases a 25,000-sq. ft. approved cultivation facility located in San Juan, Puerto Rico. The Company will be the exclusive funding source, and supervise all infrastructure buildout, equipment lease/finance, security systems and personnel and provide access of seasoned Colorado and California cultivation crews to ensure the facility meets all standard operating procedures as set forth by the Department Of Health of Puerto Rico. Under the agreement, the Company receives $12,000 a month in consulting fees, licensing fees on all vaporizer and edible sales, equipment and lighting rental and financing fees along with equity interest in the property. For the year ended December 31, 2017, the Company received $48,000 in consulting fees. As of December 31, 2017, the Company has invested $110,000. On August 7, 2017, the Company signed a LOI with Green Acres, whereby in consideration of consulting fees, licensing fees on all vaporizer and edible brands, equipment and lighting rental and financing fees, the Company will provide up to $250,000 of working capital and potentially, up to $3,500,000 for the buyout of Green Acres existing mortgage on their Washington State facility. As of December 31, 2017, the Company has invested $100,000. Repayment terms are to be from thirty percent of Green Acres monthly EBITDA. If Green Acres does not have EBITDA in a month there will not be a payment for that month. On October 5, 2017, the Company agreed to lease from the Company’s CEO, a "420 Style" resort and estate property approximately one hour outside of Quebec City, Canada. The fifteen-acre estate consists of nine (9) guest suites, horse stables, and is within walking distance to a public golf course. A separate structure will serve as a small grow facility run by patient employees and caretakers on the property which may be toured by guests of the facility. On August 8, 2017, the Company issued 5,000,000 shares of common stock to the seller. The Company valued the shares at $0.0123 per share (the market price of the common stock) and has included $61,500 in stock compensation expense. The Company purchase from the seller furniture and fixtures for $96,000. Pursuant to the agreement, the Company will pay $8,000 per month in exchange for the Company being entitled to all rents and income generated from the property. The Company will be responsible for all costs of the property, including, but not limited to, renovations, repairs and maintenance, insurance and utilities. As of December 31, 2017, the Company has not made any monthly payments and also has not received any rental income from the property, as it is currently renovating the house. Legal & Other On March 2, 2015, the Company, the Company’s CEO and the Company’s CFO at the time were named in a civil complaint filed by Erick Rodriguez in the District Court in Clark County, Nevada (the “DCCC”). The complaint alleges that Mr. Rodriguez never received 250,000 shares of Series B preferred stock that were initially approved by the Board of Directors in 2012, subject to the completion of a merger of a company controlled by Mr. Rodriguez. Since the merger was never completed, the shares were never certificated to Mr. Rodriguez. On March 21, 2017, the DCC agreed to Set Aside the Entry of Default against the Defendants. Mr. Rodriguez resigned in June 2013. On April 12, 2018, the Arbitrator issued a final award to Rodriguez in the amount of $399,291. The Company and the Company’s counsel believe the Arbitrator denied a number of detailed objections to the award, which cited clear mistakes as to Nevada law and to the facts. The Company has retained a Nevada attorney who is an expert in fighting attempts to convert arbitration awards into judgments in Nevada courts, to work with our arbitration counsel. The Company recorded a loss on legal matter, included in other expenses for the year ended December 31, 2017. On May 6, 2016, the Company, B. Michael Freidman and Barry Hollander (former CFO) were named as defendants in a Summons/Complaint filed by Justin Braune (the “Plaintiff”) in Palm Beach County Civil Court, Florida (the “PBCCC”). The complaint alleges that Mr. Braune was entitled to shares of common stock of the Company. On December 5, 2016, the PBCCC set aside a court default that had been previously issued. The defendants have answered the complaint, including the defenses that Mr. Braune advised the Company’s transfer agent and the Company in his letter of resignation dated November 4, 2015, clearly stating that he has relinquished all shares of common stock. The Company has filed a counterclaim suit against the Plaintiff, as well as sanctions against the Plaintiff and their counsel. |
Going Concern
Going Concern | 12 Months Ended |
Dec. 31, 2017 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Going Concern | Note 14 – Going Concern The accompanying condensed consolidated financial statements have been prepared assuming the Company will continue as a going concern. As of December 31, 2017, the Company had an accumulated deficit of $25,578,077 and working capital deficit of $6,672,693, inclusive of a derivative liability of $5,416,830. These conditions raise substantial doubt about the Company's ability to continue as a going concern. The consolidated financial statements do not include any adjustments that might result from the outcome of this uncertainty. |
Segment Reporting
Segment Reporting | 12 Months Ended |
Dec. 31, 2017 | |
Segment Reporting [Abstract] | |
Segment Reporting | Note 15 – Segment Reporting During the year ended December 31, 2017 and 2016, the Company operated in one reportable segment, wholesale sales. |
Subsequent Events
Subsequent Events | 12 Months Ended |
Dec. 31, 2017 | |
Subsequent Events [Abstract] | |
Subsequent Events | Note 16 – Subsequent Events On January 2, 2018, the Company issued 2,631,579 shares of common stock upon the exercise of warrant #1 (see note 9). On January 5, 2018, the Company issued 4,870,000 shares of common stock upon the exercise of warrant #1 (see note 9). On January 9, 2018, the company received $50,000 pursuant to a Stock Purchase Agreement by and between the Company and St George. On January 9, 2018, St. George funded $200,000 of the secured promissory notes issued to the Company, and the Company recorded $220,000 as convertible note payable, including $20,000 OID interest. On January 10, 2018, the Company issued 7,500,000 shares of common stock upon the exercise of warrant #1 (see note 9). On January 12, 2018, the Company paid $236,817 to Cerberus to redeem all of their remaining convertible notes with the Company. On January 23, 2018, the Company issued 5,550,000 shares of common stock upon the exercise of warrant #1 (see note 9). On January 23, 2018, the company received $100,000 pursuant to a Stock Purchase Agreement by and between the Company and St George. On February 2, 2018, the Company issued 8,000,000 shares of common stock upon the exercise of warrant #1 (see note 9). On February 2, 2018, the company received $100,000 pursuant to a Stock Purchase Agreement by and between the Company and St George. On February 12, 2018, the Company issued 13,297,872 shares of common stock upon the conversion of $75,000 of principal and interest. The shares were issued at $0.00564 per share. On February 27, 2018, the company received $90,000 pursuant to a Stock Purchase Agreement by and between the Company and St George. On March 20, 2018, the company received $75,000 of the secured promissory notes issued to the Company by St George. On March 28, 2018, the Company issued 8,865,248 shares of common stock upon the conversion of $50,000 of principal and interest. The shares were issued at $0.00564 per share. |
Summary of Significant Accoun24
Summary of Significant Account Policies (Policies) | 12 Months Ended |
Dec. 31, 2017 | |
Accounting Policies [Abstract] | |
Basis of Presentation and Principles of Consolidation | Basis of Presentation and Principles of Consolidation The accompanying consolidated financial statements are prepared in accordance with Generally Accepted Accounting Principles in the United States of America ("US GAAP"). The consolidated financial statements of the Company include the consolidated accounts of Agritek and its’ wholly owned subsidiaries MediSwipe, AVHI, The American Hemp Trading Company, Inc., a Colorado Corporation (dba 77Acres, Inc.) and PPI. PPI, a Florida corporation, was originally formed on July 1, 2013 as The American Hemp Trading Company, Inc. (“HempFL”) and on August 27, 2014, HempFL changed its’ name to PPI. All intercompany accounts and transactions have been eliminated in consolidation. |
Cash and Cash Equivalents | Cash and Cash Equivalents The Company considers all highly liquid investments with an original term of three months or less to be cash equivalents. |
Accounts Receivable | Accounts Receivable The Company records accounts receivable from amounts due from its customers upon the shipment of products. The allowance for losses is established through a provision for losses charged to expenses. Receivables are charged against the allowance for losses when management believes collectability is unlikely. The allowance is an amount that management believes will be adequate to absorb estimated losses on existing receivables, based on evaluation of the collectability of the accounts and prior loss experience. While management uses the best information available to make its evaluations, this estimate is susceptible to significant change in the near term. As of December 31, 2017 and 2016, based on the above criteria, the Company has a full allowance for doubtful accounts of $43,408. |
Inventory | Inventory Inventory is valued at the lower of cost or market value. Cost is determined using the first in first out (FIFO) method. Provision for pot entially obsolete or slow-moving inventory is made based on management analysis or inventory levels and future sales forecasts. |
Notes receivable | Notes receivable During the year ended December 31, 2017, the Company has recorded notes receivable the following: • $110,000 pursuant to a five (5) year operational and exclusive licensing agreement with a third party who leases a 25,000-sq. ft. approved cultivation facility located in San Juan, Puerto Rico (see Note 10). • $100,000 pursuant to a five (5) year operational and exclusive licensing agreement with a third party who leases a 10,000-sq. ft. approved cultivation facility located in Washington State (see Note 10). |
Deferred Financing Costs | Deferred Financing Costs The costs related to the issuance of debt are capitalized and amortized to interest expense using the straight-line method through the maturities of the related debt. |
Derivative Financial Instruments | Derivative Financial Instruments The Company does not use derivative instruments to hedge exposures to cash flow, market, or foreign currency risks. The Company evaluates all of it financial instruments, including stock purchase warrants, to determine if such instruments are derivatives or contain features that qualify as embedded derivatives. For derivative financial instruments that are accounted for as liabilities, the derivative instrument is initially recorded at its fair value and is then re-valued at each reporting date, with changes in the fair value reported as charges or credits to income. For option-based simple derivative financial instruments, the Company uses the Black-Scholes option-pricing model to value the derivative instruments at inception and subsequent valuation dates. The classification of derivative instruments, including whether such instruments should be recorded as liabilities or as equity, is re-assessed at the end of each reporting period. |
Debt Issue Costs and Debt Discount | Debt Issue Costs and Debt Discount The Company may record debt issue costs and/or debt discounts in connection with raising funds through the issuance of debt. These costs may be paid in the form of cash, or equity (such as warrants). These costs are amortized to interest expense over the life of the debt. If a conversion of the underlying debt occurs prior to maturity a proportionate share of the unamortized amounts is immediately expensed. |
Original Issue Discount | Original Issue Discount For certain convertible debt issued, the Company may provide the debt holder with an original issue discount. The original issue discount would be recorded to debt discount, reducing the initial carrying value of the note and is amortized to interest expense through the maturity of the debt. If a conversion of the underlying debt occurs prior to maturity a proportionate share of the unamortized amounts is immediately expensed. |
Marketable Securities and Other Comprehensive Income | Marketable Securities and Other Comprehensive Income The Company classifies its marketable securities as available-for-sale securities, which are carried at their fair value based on the quoted market prices of the securities with unrealized gains and losses, net of deferred income taxes, reported as accumulated other comprehensive income (loss), a separate component of stockholders’ equity. Realized gains and losses on available-for-sale securities are included in net earnings in the period earned or incurred. |
Investment of Non-Marketable Securities | Investment of Non-Marketable Securities In 2014, the Company purchased an investment in non-marketable securities of a less than 10% interest in two privately held companies of $25,000 each, that provide merchant processing services. During the year ended December 31, 2017, due to recent losses, management wrote off the investment of $50,000, which is included in Other expenses on the consolidated statements of operations included herein. As of December 31, 2017, and 2016, the balance of the Investment of Non-Marketable Securities and Other was $-0- and $50,000, respectively |
Property and Equipment | Property and Equipment Property and equipment are stated at cost, and except for land, depreciation is provided by use of a straight-line method over the estimated useful lives of the assets. The Company reviews property and equipment for potential impairment whenever events or changes in circumstances indicate that the carrying amounts of assets may not be recoverable. In February, 2017, the Company entered into a land purchase contract to acquire approximately 80 acres including water and mineral rights. The total cost of the land was $129,555. The Company paid $41,554 at closing and issued a note payable for $88,000. As of December 31, 2017, the Company is on the deed of trust of the property with a remaining note balance of $51,500 due the seller. The estimated useful lives of property and equipment are as follows: Furniture and equipment 5 years Manufacturing equipment 7 years The Company's property and equipment consisted of the following at December 31, 2017, and 2016: December 31, December 31, Furniture and equipment $ 180,684 $ 34,587 Land 129,555 — Accumulated depreciation (23,824 ) (8,307 ) Balance $ 286,415 $ 26,280 Depreciation expense of $15,516 and $3,566 was recorded for the years ended December 31, 2017, and 2016, respectively. |
Long-Lived Assets | Long-Lived Assets Long-lived assets are reviewed for impairment when events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. |
Deferred rent | Deferred rent The Company calculates the total cost of the lease for the entire lease period and divides that amount by the number of months of the lease. The result is the average monthly expense and is charged to rent expense with the offset to deferred rent, irrespective of the actual amount paid. The amounts paid are charged to the deferred rent account. Rent expense of $45,417 for the year ended December 31, 2017, was recorded for the office space in Puerto Rico and the Company made payments of $20,516. As of December 31, 2017, the Company has a balance of $24,916 in deferred rent which is included in the consolidated balance sheet. |
Revenue Recognition | Revenue Recognition The Company recognizes revenue in accordance with FASB ASC 605, Revenue Recognition. ASC 605 requires that four basic criteria are met: (1) persuasive evidence of an arrangement exists, (2) delivery of products and services has occurred, (3) the fee is fixed or determinable and (4) collectability is reasonably assured. The Company recognizes revenue during the month in which products are shipped or fees are earned. Consulting revenue of $48,000 and product sales (net) of $2,000 has been recognized for the year ended December 31, 2017. |
Fair Value of Financial Instruments | Fair Value of Financial Instruments The Company measures assets and liabilities at fair value based on an expected exit price as defined by the authoritative guidance on fair value measurements, which represents the amount that would be received on the sale of an asset or paid to transfer a liability, as the case may be, in an orderly transaction between market participants. As such, fair value may be based on assumptions that market participants would use in pricing an asset or liability. The authoritative guidance on fair value measurements establishes a consistent framework for measuring fair value on either a recurring or nonrecurring basis whereby inputs, used in valuation techniques, are assigned a hierarchical level. The following are the hierarchical levels of inputs to measure fair value: ☐ Level 1 - Observable inputs that reflect quoted market prices in active markets for identical assets or liabilities. ☐ Level 2 - Inputs reflect quoted prices for identical assets or liabilities in markets that are not active; quoted prices for similar assets or liabilities in active markets; inputs other than quoted prices that are observable for the assets or liabilities; or inputs that are derived principally from or corroborated by observable market data by correlation or other means. ☐ Level 3 - Unobservable inputs reflecting the Company's assumptions incorporated in valuation techniques used to determine fair value. These assumptions are required to be consistent with market participant assumptions that are reasonably available. The carrying amounts of the Company's financial assets and liabilities, such as cash, prepaid expenses, other current assets, accounts payable and accrued expenses, certain notes payable and notes payable - related party, approximate their fair values because of the short maturity of these instruments. The following table represents the Company’s financial instruments that are measured at fair value on a recurring basis as of December 31, 2017, and 2016, for each fair value hierarchy level: December 31, 2017 Derivative Liabilities Total Level I $ — $ — Level II $ — $ — Level III $ 5,416,830 $ 5,416,830 December 31, 2016 Level I $ — $ — Level II $ — $ — Level III $ 1,613,770 $ 1,613,770 |
Income Taxes | Income Taxes The Company accounts for income taxes in accordance with ASC 740-10, Income Taxes. Deferred tax assets and liabilities are recognized to reflect the estimated future tax effects, calculated at the tax rate expected to be in effect at the time of realization. A valuation allowance related to a deferred tax asset is recorded when it is more likely than not that some portion of the deferred tax asset will not be realized. Deferred tax assets and liabilities are adjusted for the effects of the changes in tax laws and rates of the date of enactment. ASC 740-10 prescribes a recognition threshold that a tax position is required to meet before being recognized in the financial statements and provides guidance on recognition, measurement, classification, interest and penalties, accounting in interim periods, disclosure and transition issues. Interest and penalties are classified as a component of interest and other expenses. To date, the Company has not been assessed, nor paid, any interest or penalties. Uncertain tax positions are measured and recorded by establishing a threshold for the financial statement recognition and measurement of a tax position taken or expected to be taken in a tax return. Only tax positions meeting the more-likely-than-not recognition threshold at the effective date may be recognized or continue to be recognized. The Company’s tax years subsequent to 2005 remain subject to examination by federal and state tax jurisdictions. |
Earnings (Loss) Per Share | Earnings (Loss) Per Share Earnings (loss) per share are computed in accordance with ASC 260, "Earnings per Share". Basic earnings (loss) per share is computed by dividing net income (loss), after deducting preferred stock dividends accumulated during the period, by the weighted-average number of shares of common stock outstanding during each period. Diluted earnings per share is computed by dividing net income by the weighted-average number of shares of common stock, common stock equivalents and other potentially dilutive securities, if any, outstanding during the period. As of December 31, 2017, there were warrants and options to purchase 49,135,392 shares of common stock and the Company’s outstanding convertible debt is convertible into approximately 138,041,561 shares of common stock. These amounts are not included in the computation of dilutive loss per share because their impact is anti-dilutive. |
Accounting for Stock-based Compensation | Accounting for Stock-Based Compensation The Company accounts for stock awards issued to non-employees in accordance with ASC 505-50, Equity-Based Payments to Non-Employees. The measurement date is the earlier of (1) the date at which a commitment for performance by the counterparty to earn the equity instruments is reached, or (2) the date at which the counterparty's performance is complete. Stock awards granted to non-employees are valued at their respective measurement dates based on the trading price of the Company’s common stock and recognized as expense during the period in which services are provided. For the year ended December 31, 2017, and 2016 the Company recorded stock- based compensation of $520,600 and $2,371, respectively (See Notes 10 and 11). |
Use of Estimates | Use of Estimates The preparation of consolidated financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosures of contingent assets and liabilities at the date of the consolidated financial statements and the reported amount of revenues and expenses during the reported period. Actual results could differ from those estimates. |
Advertising | Advertising The Company records advertising costs as incurred. For the years ending December 31, 2017, and 2016, advertising expenses was $54,927 and $8,321, respectively. |
Summary of Significant Accoun25
Summary of Significant Account Policies (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Accounting Policies [Abstract] | |
Property and equipment | December 31, December 31, Furniture and equipment $ 180,684 $ 34,587 Land 129,555 — Accumulated depreciation (23,824 ) (8,307 ) Balance $ 286,415 $ 26,280 |
Financial instruments measured at fair value on a recurring basis | December 31, 2017 Derivative Liabilities Total Level I $ — $ — Level II $ — $ — Level III $ 5,416,830 $ 5,416,830 December 31, 2016 Level I $ — $ — Level II $ — $ — Level III $ 1,613,770 $ 1,613,770 |
Marketable Securities (Tables)
Marketable Securities (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Investments, Debt and Equity Securities [Abstract] | |
Marketable securities | 2017 2016 Balance January 1 $ 39,769 $ — Fair value of stock received — 16,525 Unrealized gain marked to fair value 2,093 23,244 Balance December 31 $ 41,862 $ 39,769 |
Prepaid Expenses (Tables)
Prepaid Expenses (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Other Income (Expense): | |
Prepaid expenses | December 31, 2017 December 31, 2016 Vendor deposits $ 46,000 $ 6,000 Consulting fees — 4,000 Investor relations 2,500 — Total prepaid expenses $ 48,500 $ 10,000 |
Convertible Debt (Tables)
Convertible Debt (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Debt Disclosure [Abstract] | |
Common stock issued upon conversions of portions of Convertible Notes | Date Principal Conversion Interest Conversion Total Conversion Conversion Price Shares Issued Issued to 1/10/17 $ 73,000 $ 5,664 $ 78,664 $ 0.01595 4,931,912 Cerberus 1/17/17 $ 57,500 $ 4,562 $ 62,062 $ 0.01537 4,037,878 LG 1/27/17 $ 48,129 $ 3,914 $ 52,043 $ 0.01276 4,078,598 Cerberus 2/8/17 $ 60,000 $ 5,050 $ 65,050 $ 0.012934 5,029,369 LG 2/27/17 $ 26,120 $ 2,171 $ 28,291 $ 0.013804 2,049,467 Cerberus 3/10/17 $ 40,000 $ 3,630 $ 43,630 $ 0.01363 3,200,997 LG 3/27/17 $ 34,775 $ 3,255 $ 38,030 $ 0.012876 2,953,523 Cerberus 3/28/17 $ 65,625 $ 3,697 $ 69,322 $ 0.01276 5,432,725 LG 4/25/17 $ 76,081 $ 4,752 $ 80,833 $ 0.009744 8,295,680 LG 5/10/17 $ 22,000 $ 2,199 $ 24,199 $ 0.008 3,023,338 Cerberus 5/10/17 $ 20,640 $ 9,360 $ 30,000 $ 0.0075 4,000,000 St Georges 5/25/17 $ 29,052 $ 947 $ 30,000 $ 0.00564 5,319,149 St Georges 6/6/17 $ 32,813 $ 2,999 $ 35,811 $ .00551 6,499,359 LG 6/8/17 $ 34,100 $ 900 $ 35,000 $ 0.00564 6,205,674 St Georges 6/9/17 $ 22,000 $ 1,500 $ 23,500 $ 0.00551 4,264,903 Cerberus 6/29/17 $ 48,849 $ 1,151 $ 50,000 $ .00564 8,865,248 St Georges 6/30/17 $ 30,625 $ 2,960 $ 33,585 $ 0.0058 5,790,541 LG 7/17/17 $ 37,358 $ 733 $ 38,091 $ 0.00564 6,753,817 St Georges 7/25/17 $ 35,000 $ 3,575 $ 38,575 $ 0.005568 6,927,943 LG 7/26/17 $ 28,000 $ 1,117 $ 29,117 $ 0.005568 5,229,334 Cerberus 8/15/17 $ 35,199 $ 409 $ 35,608 $ 0.0058 6,139,276 LG 8/29/17 $ 38,000 $ 558 $ 38,558 $ 0.005858 6,582,115 LG 9/19/17 $ 34,500 $ 665 $ 35,165 $ 0.008178 4,300,002 LG 10/9/17 $ 30,000 $ 710 $ 30,710 $ 0.007076 4,340,042 LG 10/23/17 $ 30,000 $ 802 $ 30,802 $ 0.006090 5,057,830 LG 11/6/17 $ 28,376 $ 6,624 $ 35,000 $ 0.005640 6,205,674 St Georges 11/6/17 $ 19,500 $ 1,218 $ 20,718 $ 0.005858 3,536,715 LG 11/13/17 $ 35,000 $ 2,240 $ 37,240 $ 0.005858 6,357,118 Cerberus 11/14/17 $ 26,624 $ 428 $ 27,052 $ 0.005640 4,796,452 St Georges 11/15/17 $ 75.000 $ 4,833 $ 79,833 $ 0.005742 13,903,322 LG 12/1/17 $ 32,813 $ 453 $ 33,266 $ 0.005742 5,793,378 LG 12/5/17 $ 16,756 $ 1,105 $ 17,861 $ 0.005640 3,166,816 St Georges 12/7/17 $ 32,813 $ 2,567 $ 35,380 $ 0.005916 5,980,387 LG 12/15/17 $ 52,000 $ 889 $ 52,889 $ 0.005916 8,939,991 LG 12/28/17 $ 42,000 $ 2,209 $ 44,209 $ 0.006728 6,570,945 Cerberus $ 1,350,247 $ 89,846 $ 1,440,093 194,559,520 Date Principal Conversion Interest Conversion Total Conversion Shares Issued to 12/28/16 $ 45,000 $ 3,511 $ 48,511 $ 0.015080 3,216,925 LG 12/13/16 $ 9,500 $ 400 $ 9,900 $ 0.000754 13,129,683 Cerberus 9/26/16 $ 8,613 $ 629 $ 9,242 $ 0.001218 7,587,824 LG 7/29/16 $ 7,500 $ 801 $ 8,301 $ 0.000081 10,222,352 LG 7/20/16 $ 9,500 $ 995 $ 10,495 $ 0.000098 10,644,310 LG 7/12/16 $ 9,000 $ 927 $ 9,927 $ 0.000986 10,068,073 LG 7/1/16 $ 8,000 $ 805 $ 8,805 $ 0.001160 7,590,362 LG 6/22/16 $ 5,000 $ 973 $ 5,973 $ 0.001450 4,119,414 GW 6/20/16 $ 10,500 $ 1,003 $ 11,503 $ 0.001450 7,933,377 Cerberus 6/20/16 $ 5,000 $ 967 $ 5,967 $ 0.001450 4,114,879 GW 6/20/16 $ 6,000 $ 589 $ 6,589 $ 0.001450 4,544,241 LG 6/10/16 $ 6,075 $ 1,134 $ 7,209 $ 0.001798 4,009,701 GW 6/9/16 $ 5,000 $ 479 $ 5,479 $ 0.001798 3,047,219 LG 6/2/16 $ 9,000 $ 848 $ 9,848 $ 0.002378 4,141,387 Cerberus 5/23/16 $ 5,000 $ 460 $ 5,460 $ 0.002436 2,241,490 LG 3/17/16 $ 9,000 $ 696 $ 9,696 $ 0.002436 3,980,431 LG 3/17/16 $ 3,000 $ 138 $ 3,138 $ 0.000638 4,918,624 Service 3/8/16 $ 7,425 $ 928 $ 8,353 $ 0.00174 4,800,354 GW 3/7/16 $ 6,500 $ 489 $ 6,989 $ 0.00174 4,016,471 LG $ 174,613 $ 16,772 $ 191,385 114,327,117 |
Summary of convertible notes payable balance | 2017 2016 Beginning Principal Balance $ 826,480 $ 472,515 Convertible notes-newly issued 1,813,210 521,731 Conversion of convertible notes (principal) (1,350,247 ) 6,848 Principal payments (310,000 ) (174,613 ) Unamortized discount (494,193 ) (257,033 ) Ending Principal Balance, net $ 485,250 $ 569,448 |
Derivative liabilities (Tables)
Derivative liabilities (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Notes to Financial Statements | |
Summary of derivative liability balance | A summary of the derivative liability balance as of December 31, 2017, is as follows: Notes Warrants Total Beginning Balance $ 1,410,647 $ 203,023 $ 1,613,670 Initial Derivative Liability 3,633,502 415,313 4,048,815 Fair Value Change 1,571,986 1,190,244 2,762,230 Reclassified to Additional paid- in capital (2,184,277 ) — (2,184,277 ) Reduction for debt assignment (823,610 ) — (823,610 ) Ending Balance $ 3,608,250 $ 1,808,580 $ 5,416,830 A summary of the derivative liability balance as of December 31, 2016 is as follows: Beginning Balance $ 167,014 Initial Derivative Liability 4,114,649 Fair Value Change (1,791,988 ) Debt extinguishment (84,057 ) Reduction for conversions (791,851 ) Ending Balance $ 1,613,767 |
Fair value assumptions for derivative liabilities | The fair value at the commitment date for the 2017 Convertible Notes and the re-measurement dates for the Company’s derivative liabilities were based upon the following management assumptions as of December 31, 2017: Commitment date Remeasurement date Expected dividends -0- -0- Expected volatility 199%-361% 320%-331% Expected term 12 months 3-12 months Risk free interest .65%-1.78% 1.51%-1.79% The fair value at the commitment date for the 2016 Convertible Notes and the re-measurement dates for the Company’s derivative liabilities were based upon the following management assumptions as of December 31, 2016: Commitment date Remeasurement date Expected dividends -0- -0- Expected volatility 243%-268% 246% Expected term 12 months 1-12 months Risk free interest .44%-.68% .48%-.85% |
Fair value assumptions for warrants | Commitment date Remeasurement date Expected dividends -0- -0- Expected volatility 203% - 384% 320% Expected term 3.87 - 4.64 years 3.84 years Risk free interest 1.72% - 2.05% 1.81% |
Common and Preferred Stock (Tab
Common and Preferred Stock (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Common And Preferred Stock Tables | |
Common stock issuances upon conversion of portions of convertible notes | 2017 Issuances Date Principal Conversion Interest Conversion Total Conversion Conversion Price Shares Issued Issued to 1/10/17 $ 73,000 $ 5,664 $ 78,664 $ 0.01595 4,931,912 Cerberus 1/17/17 $ 57,500 $ 4,562 $ 62,062 $ 0.01537 4,037,878 LG 1/27/17 $ 48,129 $ 3,914 $ 52,043 $ 0.01276 4,078,598 Cerberus 2/8/17 $ 60,000 $ 5,050 $ 65,050 $ 0.012934 5,029,369 LG 2/27/17 $ 26,120 $ 2,171 $ 28,291 $ 0.013804 2,049,467 Cerberus 3/10/17 $ 40,000 $ 3,630 $ 43,630 $ 0.01363 3,200,997 LG 3/27/17 $ 34,775 $ 3,255 $ 38,030 $ 0.012876 2,953,523 Cerberus 3/28/17 $ 65,625 $ 3,697 $ 69,322 $ 0.01276 5,432,725 LG 4/25/17 $ 76,081 $ 4,752 $ 80,833 $ 0.009744 8,295,680 LG 5/10/17 $ 22,000 $ 2,199 $ 24,199 $ 0.008 3,023,338 Cerberus 5/10/17 $ 20,640 $ 9,360 $ 30,000 $ 0.0075 4,000,000 St Georges 5/25/17 $ 29,052 $ 947 $ 30,000 $ 0.00564 5,319,149 St Georges 6/6/17 $ 32,813 $ 2,999 $ 35,811 $ .00551 6,499,359 LG 6/8/17 $ 34,100 $ 900 $ 35,000 $ 0.00564 6,205,674 St Georges 6/9/17 $ 22,000 $ 1,500 $ 23,500 $ 0.00551 4,264,903 Cerberus 6/29/17 $ 48,849 $ 1,151 $ 50,000 $ .00564 8,865,248 St Georges 6/30/17 $ 30,625 $ 2,960 $ 33,585 $ 0.0058 5,790,541 LG 7/17/17 $ 37,358 $ 733 $ 38,091 $ 0.00564 6,753,817 St Georges 7/25/17 $ 35,000 $ 3,575 $ 38,575 $ 0.005568 6,927,943 LG 7/26/17 $ 28,000 $ 1,117 $ 29,117 $ 0.005568 5,229,334 Cerberus 8/15/17 $ 35,199 $ 409 $ 35,608 $ 0.0058 6,139,276 LG 8/29/17 $ 38,000 $ 558 $ 38,558 $ 0.005858 6,582,115 LG 9/19/17 $ 34,500 $ 665 $ 35,165 $ 0.008178 4,300,002 LG 10/9/17 $ 30,000 $ 710 $ 30,710 $ 0.007076 4,340,042 LG 10/23/17 $ 30,000 $ 802 $ 30,802 $ 0.006090 5,057,830 LG 11/6/17 $ 28,376 $ 6,624 $ 35,000 $ 0.005640 6,205,674 St Georges 11/6/17 $ 19,500 $ 1,218 $ 20,718 $ 0.005858 3,536,715 LG 11/13/17 $ 35,000 $ 2,240 $ 37,240 $ 0.005858 6,357,118 Cerberus 11/14/17 $ 26,624 $ 428 $ 27,052 $ 0.005640 4,796,452 St Georges 11/15/17 $ 75.000 $ 4,833 $ 79,833 $ 0.005742 13,903,322 LG 12/1/17 $ 32,813 $ 453 $ 33,266 $ 0.005742 5,793,378 LG 12/5/17 $ 16,756 $ 1,105 $ 17,861 $ 0.005640 3,166,816 St Georges 12/7/17 $ 32,813 $ 2,567 $ 35,380 $ 0.005916 5,980,387 LG 12/15/17 $ 52,000 $ 889 $ 52,889 $ 0.005916 8,939,991 LG 12/28/17 $ 42,000 $ 2,209 $ 44,209 $ 0.006728 6,570,945 Cerberus $ 1,350,247 $ 89,846 $ 1,440,093 194,559,520 Date Principal Conversion Interest Conversion Total Conversion Shares Issued to 12/28/16 $ 45,000 $ 3,511 $ 48,511 $ 0.015080 3,216,925 LG 12/13/16 $ 9,500 $ 400 $ 9,900 $ 0.000754 13,129,683 Cerberus 9/26/16 $ 8,613 $ 629 $ 9,242 $ 0.001218 7,587,824 LG 7/29/16 $ 7,500 $ 801 $ 8,301 $ 0.000081 10,222,352 LG 7/20/16 $ 9,500 $ 995 $ 10,495 $ 0.000098 10,644,310 LG 7/12/16 $ 9,000 $ 927 $ 9,927 $ 0.000986 10,068,073 LG 7/1/16 $ 8,000 $ 805 $ 8,805 $ 0.001160 7,590,362 LG 6/22/16 $ 5,000 $ 973 $ 5,973 $ 0.001450 4,119,414 GW 6/20/16 $ 10,500 $ 1,003 $ 11,503 $ 0.001450 7,933,377 Cerberus 6/20/16 $ 5,000 $ 967 $ 5,967 $ 0.001450 4,114,879 GW 6/20/16 $ 6,000 $ 589 $ 6,589 $ 0.001450 4,544,241 LG 6/10/16 $ 6,075 $ 1,134 $ 7,209 $ 0.001798 4,009,701 GW 6/9/16 $ 5,000 $ 479 $ 5,479 $ 0.001798 3,047,219 LG 6/2/16 $ 9,000 $ 848 $ 9,848 $ 0.002378 4,141,387 Cerberus 5/23/16 $ 5,000 $ 460 $ 5,460 $ 0.002436 2,241,490 LG 3/17/16 $ 9,000 $ 696 $ 9,696 $ 0.002436 3,980,431 LG 3/17/16 $ 3,000 $ 138 $ 3,138 $ 0.000638 4,918,624 Service 3/8/16 $ 7,425 $ 928 $ 8,353 $ 0.00174 4,800,354 GW 3/7/16 $ 6,500 $ 489 $ 6,989 $ 0.00174 4,016,471 LG $ 174,613 $ 16,772 $ 191,385 114,327,117 |
Activity related to warrants | Number of Warrants Weighted-Average Exercise Price per share Weighted-Average Remaining Life (Years) Outstanding at January 1, 2016 1,300,000 $ 0.05 3.00 Warrants issued 16,926,130 0.00564 Warrants expired (300,000 ) (0.05 ) Outstanding and exercisable at December 31, 2016 17,926,130 0.0811 4.88 Warrant issued 40,573,870 0.00564 Warrants exercised (9,364,108 ) 0.00564 Outstanding and exercisable at December 31, 2017 49,135,892 0.00654 4.17 |
Income Taxes (Tables)
Income Taxes (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Income Tax Disclosure [Abstract] | |
Components of income tax rate reconciliation | 2017 2016 Net tax loss carry-forwards $ 7,878,733 $ 5,836,000 Statutory rate 37.6 % 37.6 % Expected tax recovery 2,962,404 2,194,336 Change in valuation allowance (2,962,404 ) (2,194,336 ) Income tax provision $ — $ — Components of deferred tax asset: Non capital tax loss carry forwards $ 2,962,404 $ 2,194,336 Less: valuation allowance (2,962,404 ) (2,194,336 ) Net deferred tax asset $ — $ — |
Summary of Significant Accoun32
Summary of Significant Account Policies - Property and equipment (Details) - USD ($) | Dec. 31, 2017 | Dec. 31, 2016 |
Summary Of Significant Account Policies - Property And Equipment Details | ||
Furniture and Equipment | $ 180,684 | $ 34,587 |
Land | 129,555 | |
Accumulated depreciation | (23,824) | (8,307) |
Balance | $ 286,415 | $ 26,280 |
Summary of Significant Accounti
Summary of Significant Accounting Policies - Financial instruments measured at fair value on a recurring basis (Details) - USD ($) | Dec. 31, 2017 | Dec. 31, 2016 |
Derivative liabilities | $ 5,416,830 | $ 1,613,770 |
Level I | ||
Derivative liabilities | ||
Level II | ||
Derivative liabilities | ||
Level III | ||
Derivative liabilities | $ 5,416,830 | $ 1,613,770 |
Summary of Significant Accoun34
Summary of Significant Account Policies (Details Narrative) - USD ($) | 12 Months Ended | |
Dec. 31, 2017 | Dec. 31, 2016 | |
Allowance for doubtful accounts | $ 43,408 | |
Note receivable recorded, licensing agreement (1) | $ 110,000 | |
Note receivable recorded, licensing agreement (2) | 100,000 | |
Investment of non-marketable securities | 50,000 | |
Remaining note balance held by original land owner | 51,500 | |
Depreciation expense | (15,516) | (3,566) |
Rent expense | 45,417 | |
Payments made for rent | 20,516 | |
Deferred rent balance | 24,916 | |
Consulting revenue | 48,000 | |
Product sales | $ 2,000 | 3,228 |
Warrants to purchase common stock excluded from computation of earnings per share | 49,135,392 | |
Antidilutive shares excluded from computation of earnings per share | 138,041,561 | |
Stock based compensation | $ 520,600 | 2,371 |
Advertising expenses | $ 54,927 | $ 8,321 |
Furniture and fixtures | ||
Useful life | 5 years | |
Manufacturing equipment | ||
Useful life | 7 years |
Marketable Securities - Marketa
Marketable Securities - Marketable securities (Details) - USD ($) | 12 Months Ended | |
Dec. 31, 2017 | Dec. 31, 2016 | |
Investments, Debt and Equity Securities [Abstract] | ||
Beginning balance | $ 39,769 | |
Fair value of stock received | 16,525 | |
Unrealized gain marked to fair value | 2,093 | 23,244 |
Ending balance | $ 41,862 | $ 39,769 |
Marketable Securities (Details
Marketable Securities (Details Narrative) | Feb. 29, 2016USD ($) |
Investments, Debt and Equity Securities [Abstract] | |
Market value of shares of common stock received | $ 16,525 |
Prepaid Expenses - Prepaid expe
Prepaid Expenses - Prepaid expenses (Details) - USD ($) | Dec. 31, 2017 | Dec. 31, 2016 |
Prepaid Expenses - Prepaid Expenses Details | ||
Vendor deposits | $ 46,000 | $ 6,000 |
Consulting fees | 4,000 | |
Investor relations | 2,500 | |
Total prepaid expenses | $ 48,500 | $ 10,000 |
Concentration of Credit Risk (D
Concentration of Credit Risk (Details Narrative) | Dec. 31, 2017USD ($) |
Risks and Uncertainties [Abstract] | |
FDIC maximum amount insured | $ 250,000 |
Note Payable (Details Narrative
Note Payable (Details Narrative) | 12 Months Ended |
Dec. 31, 2017USD ($) | |
Note Payable Details Narrative | |
Total cost of land | $ 129,555 |
Promissory note entered in conjunction with land purchase | 88,000 |
Amount paid by Company for land purchase | 41,554 |
Remaining note balance held by original land owner | $ 51,500 |
Convertible Debt - Common stock
Convertible Debt - Common stock issued upon conversions of portions of Convertible Notes (Details) - USD ($) | Dec. 28, 2017 | Dec. 15, 2017 | Dec. 07, 2017 | Dec. 05, 2017 | Dec. 02, 2017 | Nov. 15, 2017 | Nov. 14, 2017 | Nov. 13, 2017 | Nov. 06, 2017 | Oct. 23, 2017 | Oct. 09, 2017 | Sep. 19, 2017 | Aug. 29, 2017 | Aug. 15, 2017 | Jul. 26, 2017 | Jul. 25, 2017 | Jul. 17, 2017 | Jun. 30, 2017 | Jun. 29, 2017 | Jun. 09, 2017 | Jun. 08, 2017 | Jun. 06, 2017 | May 25, 2017 | May 10, 2017 | Apr. 25, 2017 | Mar. 28, 2017 | Mar. 27, 2017 | Mar. 10, 2017 | Feb. 27, 2017 | Feb. 08, 2017 | Jan. 27, 2017 | Jan. 17, 2017 | Jan. 10, 2017 | Dec. 28, 2016 | Dec. 13, 2016 | Sep. 26, 2016 | Jul. 29, 2016 | Jul. 20, 2016 | Jul. 12, 2016 | Jul. 01, 2016 | Jun. 22, 2016 | Jun. 20, 2016 | Jun. 10, 2016 | Jun. 09, 2016 | Jun. 02, 2016 | May 23, 2016 | Mar. 17, 2016 | Mar. 08, 2016 | Mar. 07, 2016 | Dec. 31, 2017 | Dec. 31, 2016 |
Conversions of portions of Convertible Notes | |||||||||||||||||||||||||||||||||||||||||||||||||||
Principal conversion | $ 42,000 | $ 52,000 | $ 32,813 | $ 16,756 | $ 32,813 | $ 75,000 | $ 26,624 | $ 35,000 | $ 28,376 | $ 30,000 | $ 30,000 | $ 34,500 | $ 38,000 | $ 35,199 | $ 28,000 | $ 35,000 | $ 37,358 | $ 30,625 | $ 48,849 | $ 22,000 | $ 34,100 | $ 32,813 | $ 29,052 | $ 22,000 | $ 76,081 | $ 65,625 | $ 34,775 | $ 40,000 | $ 26,120 | $ 60,000 | $ 48,129 | $ 57,500 | $ 73,000 | $ 45,000 | $ 9,500 | $ 8,613 | $ 7,500 | $ 9,500 | $ 9,000 | $ 8,000 | $ 5,000 | $ 10,500 | $ 6,075 | $ 5,000 | $ 9,000 | $ 5,000 | $ 9,000 | $ 7,425 | $ 6,500 | $ 174,613 | |
Interest conversion | 2,209 | 889 | 2,567 | 1,105 | 453 | 4,833 | 428 | 2,240 | 6,624 | 802 | 710 | 665 | 558 | 409 | 1,117 | 3,575 | 733 | 2,960 | 1,151 | 1,500 | 900 | 2,999 | 947 | 2,199 | 4,752 | 3,697 | 3,255 | 3,630 | 2,171 | 5,050 | 3,914 | 4,562 | 5,664 | 3,511 | 400 | 629 | 801 | 995 | 927 | 805 | 973 | 1,003 | 1,134 | 479 | 848 | 460 | 696 | 928 | 489 | 16,772 | |
Total conversion | $ 44,209 | $ 52,889 | $ 35,380 | $ 17,861 | $ 33,266 | $ 79,833 | $ 27,052 | $ 37,240 | $ 35,000 | $ 30,802 | $ 30,710 | $ 35,165 | $ 38,558 | $ 35,608 | $ 29,117 | $ 38,575 | $ 38,091 | $ 33,585 | $ 50,000 | $ 23,500 | $ 35,000 | $ 35,811 | $ 30,000 | $ 24,199 | $ 80,833 | $ 69,322 | $ 38,030 | $ 43,630 | $ 28,291 | $ 65,050 | $ 52,043 | $ 62,062 | $ 78,664 | $ 48,511 | $ 9,900 | $ 9,242 | $ 8,301 | $ 10,495 | $ 9,927 | $ 8,805 | $ 5,973 | $ 11,503 | $ 7,209 | $ 5,479 | $ 9,848 | $ 5,460 | $ 9,696 | $ 8,353 | $ 6,989 | $ 191,385 | |
Conversion price | $ .006728 | $ .005916 | $ .005916 | $ .005640 | $ .005742 | $ .005742 | $ .005640 | $ .005858 | $ .005640 | $ .006090 | $ .007076 | $ 0.008178 | $ 0.005858 | $ 0.0058 | $ 0.005568 | $ 0.005568 | $ 0.00564 | $ 0.0058 | $ 0.00564 | $ .00551 | $ .00564 | $ 0.00551 | $ 0.00564 | $ 0.008 | $ 0.009744 | $ 0.01276 | $ 0.012876 | $ 0.01363 | $ 0.013804 | $ 0.012934 | $ 0.01276 | $ 0.01537 | $ 0.01595 | $ .015080 | $ .000754 | $ .001218 | $ .000081 | $ .000098 | $ .000986 | $ .001160 | $ .001450 | $ .001450 | $ .001798 | $ .001798 | $ .002378 | $ .002436 | $ .002436 | $ .00174 | $ .00174 | ||
Shares Issued | 6,570,945 | 8,939,991 | 5,980,387 | 3,166,816 | 5,793,378 | 13,903,322 | 4,796,452 | 6,357,188 | 6,205,674 | 5,057,830 | 4,340,042 | 4,300,002 | 6,582,115 | 6,139,276 | 5,229,334 | 6,927,943 | 6,753,817 | 5,790,541 | 8,865,248 | 4,264,903 | 6,205,674 | 6,499,359 | 5,319,149 | 3,023,338 | 8,295,680 | 5,432,725 | 2,953,523 | 3,200,997 | 2,049,467 | 5,029,369 | 4,078,598 | 4,037,878 | 4,931,912 | 3,216,925 | 13,129,683 | 7,587,824 | 10,222,352 | 10,644,310 | 10,068,073 | 7,590,362 | 4,119,414 | 7,933,377 | 4,009,701 | 3,047,219 | 4,141,387 | 2,241,490 | 3,980,431 | 4,800,354 | 4,016,471 | 114,327,117 | |
Issued to | Cerberus | LG | LG | St Georges | LG | LG | St Georges | Cerberus | St Georges | LG | LG | LG | LG | LG | Cerberus | LG | St Georges | LG | St Georges | Cerberus | St Georges | LG | St Georges | Cerberus | LG | LG | Cerberus | LG | Cerberus | LG | Cerberus | LG | Cerberus | LG | Cerberus | LG | LG | LG | LG | LG | GW | Cerberus | GW | LG | Cerberus | LG | LG | GW | LG | ||
Conversions of portions of Convertible Notes (2) | |||||||||||||||||||||||||||||||||||||||||||||||||||
Principal conversion | $ 19,500 | $ 20,640 | $ 5,000 | $ 3,000 | |||||||||||||||||||||||||||||||||||||||||||||||
Interest conversion | 1,218 | 9,360 | 967 | 138 | |||||||||||||||||||||||||||||||||||||||||||||||
Total conversion | $ 20,718 | $ 30,000 | $ 5,967 | $ 3,138 | |||||||||||||||||||||||||||||||||||||||||||||||
Conversion price | $ .005858 | $ 0.0075 | $ .001450 | $ .000638 | |||||||||||||||||||||||||||||||||||||||||||||||
Shares Issued | 3,536,715 | 4,000,000 | 4,114,879 | 4,918,624 | |||||||||||||||||||||||||||||||||||||||||||||||
Issued to | LG | St Georges | GW | Service | |||||||||||||||||||||||||||||||||||||||||||||||
Conversions of portions of Convertible Notes | |||||||||||||||||||||||||||||||||||||||||||||||||||
Principal conversion | $ 1,350,247 | ||||||||||||||||||||||||||||||||||||||||||||||||||
Interest conversion | 89,846 | ||||||||||||||||||||||||||||||||||||||||||||||||||
Total conversion | $ 1,440,093 | ||||||||||||||||||||||||||||||||||||||||||||||||||
Shares Issued | 194,559,520 | ||||||||||||||||||||||||||||||||||||||||||||||||||
Conversions of portions of Convertible Notes (3) | |||||||||||||||||||||||||||||||||||||||||||||||||||
Principal conversion | $ 6,000 | ||||||||||||||||||||||||||||||||||||||||||||||||||
Interest conversion | 589 | ||||||||||||||||||||||||||||||||||||||||||||||||||
Total conversion | $ 6,589 | ||||||||||||||||||||||||||||||||||||||||||||||||||
Conversion price | $ .001450 | ||||||||||||||||||||||||||||||||||||||||||||||||||
Shares Issued | 4,544,241 | ||||||||||||||||||||||||||||||||||||||||||||||||||
Issued to | LG |
Convertible Debt - Summary of c
Convertible Debt - Summary of convertible notes payable balance (Details) - USD ($) | 12 Months Ended | |
Dec. 31, 2017 | Dec. 31, 2016 | |
Convertible notes payable balance summary | ||
Beginning Principal Balance | $ 826,480 | |
Convertible notes - newly issued | 1,813,210 | |
Conversion of convertible notes (principal) | (1,350,247) | |
Principal payments | (310,000) | |
Unamortized discount | (494,193) | |
Ending Principal Balance | 485,250 | $ 826,480 |
Convertible notes payable balance summary (2) | ||
Beginning Principal Balance | $ 569,448 | 472,515 |
Convertible notes - newly issued | 521,731 | |
Conversion of convertible notes (principal) | 6,848 | |
Principal payments | (174,613) | |
Unamortized discount | (257,033) | |
Ending Principal Balance | $ 569,448 |
Convertible Debt - 2014 Convert
Convertible Debt - 2014 Convertible Note (Details Narrative) - USD ($) | Jan. 19, 2016 | Jan. 31, 2014 | Apr. 30, 2015 | Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | Dec. 16, 2015 | Dec. 31, 2014 |
2014 Company Note | ||||||||
Principal amount outstanding | $ 1,660,000 | $ 311,815 | ||||||
Purchase price balance | 1,500,000 | |||||||
Transaction costs | 160,000 | |||||||
Purchase price received | 300,000 | 200,000 | $ 25,000 | $ 800,000 | ||||
Interest received, included in purchase price received | 21,888 | |||||||
Individual note value of six promissory Investor Notes issued to Company | $ 200,000 | |||||||
Investor Notes, interest rate per annum | 8.00% | |||||||
Investor Note, interest rate per annum in occurrence of event of default | 22.00% | |||||||
Conversion price | $ 0.55 | |||||||
Exercisable amount in first tranche | $ 340,000 | |||||||
Exercisable amount in six additional tranches | $ 220,000 | |||||||
Individual installment amount payable to Holder of ten installments | $ 166,000 | |||||||
Accrued interest outstanding | $ 1,041 | $ 1,041 | ||||||
Reduction of Note balance | 500,000 | |||||||
Cost for property by AVHI | 224,466 | |||||||
Accrued and unpaid interest added to the Note | $ 316,723 | |||||||
LG DPA of Tonaquint 2014 Convertible Note | ||||||||
Principal amount outstanding | $ 0 | 157,500 | ||||||
Replacement note, amount | $ 157,500 | |||||||
Principal of note acquired | 157,500 | |||||||
Amount exchanged for note | $ 75,000 | |||||||
Replacement note due date | Jan. 19, 2017 | |||||||
Replacement note, interest rate per annum | 8.00% | |||||||
Replacement note, discount to price | 42.00% | |||||||
Cerberus DPA of Tonaquint 2014 Convertible Note | ||||||||
Principal amount outstanding | $ 0 | $ 147,249 | ||||||
Replacement note, amount | $ 156,749 | |||||||
Principal of note acquired | 154,315 | |||||||
Accrued and unpaid interest on note acquired | 2,434 | |||||||
Amount exchanged for note | $ 75,000 | |||||||
Replacement note due date | Jan. 19, 2017 | |||||||
Replacement note, interest rate per annum | 8.00% | |||||||
Replacement note, discount to price | 42.00% |
Convertible Debt - 2016 Convert
Convertible Debt - 2016 Convertible Notes (Details Narrative) - USD ($) | Dec. 15, 2016 | Oct. 31, 2016 | Oct. 14, 2016 | Apr. 15, 2016 | Mar. 31, 2016 | Jan. 31, 2016 | Jan. 25, 2016 | Dec. 31, 2017 | Dec. 31, 2016 | Mar. 23, 2016 | Jan. 19, 2016 |
Initial debt discount | $ 494,193 | $ 257,034 | |||||||||
LG Purchase Agreement (1) | |||||||||||
Convertible Promissory Note issued, amount | $ 76,080 | ||||||||||
Net proceeds received | $ 62,500 | ||||||||||
Conversion of note, principal converted | 76,080 | ||||||||||
Conversion of note, accrued and unpaid interest converted | $ 4,752 | ||||||||||
Conversion price | $ 0.0097 | ||||||||||
Conversion of note, shares issued | 28,295,680 | ||||||||||
Amortization expense recorded for remaining portion of debt discount | $ 3,170 | ||||||||||
Principal outstanding | 0 | 76,080 | |||||||||
Accrued interest outstanding | 5,833 | ||||||||||
Interest rate per annum | 8.00% | ||||||||||
LG Purchase Agreement Back End Note (1) | |||||||||||
Convertible Promissory Note issued, amount | 65,625 | ||||||||||
Net proceeds received | $ 62,500 | ||||||||||
Conversion of note, principal converted | 65,625 | ||||||||||
Conversion of note, accrued and unpaid interest converted | $ 3,698 | ||||||||||
Conversion price | $ 0.01276 | ||||||||||
Conversion of note, shares issued | 5,432,726 | ||||||||||
Amortization expense recorded for remaining portion of debt discount | $ 34,818 | ||||||||||
Principal outstanding | 0 | 65,625 | |||||||||
Accrued interest outstanding | 2,465 | ||||||||||
Cerberus Purchase Agreement (1) | |||||||||||
Convertible Promissory Note issued, amount | 34,775 | ||||||||||
Net proceeds received | $ 25,000 | ||||||||||
Conversion of note, principal converted | 34,775 | ||||||||||
Conversion of note, accrued and unpaid interest converted | $ 3,255 | ||||||||||
Conversion price | $ 0.01287 | ||||||||||
Conversion of note, shares issued | 2,953,523 | ||||||||||
Amortization expense recorded for remaining portion of debt discount | $ 1,982 | ||||||||||
Principal outstanding | 0 | 34,775 | |||||||||
Accrued interest outstanding | 2,496 | ||||||||||
Interest rate per annum | 8.00% | ||||||||||
Cerberus Purchase Agreement Back End Note (1) | |||||||||||
Convertible Promissory Note issued, amount | $ 22,000 | ||||||||||
Net proceeds received | $ 20,000 | ||||||||||
Conversion of note, principal converted | 22,000 | ||||||||||
Conversion of note, accrued and unpaid interest converted | $ 1,500 | ||||||||||
Conversion price | $ 0.00551 | ||||||||||
Conversion of note, shares issued | 4,264,903 | ||||||||||
Amortization expense recorded for remaining portion of debt discount | $ 4,706 | ||||||||||
Principal outstanding | 0 | ||||||||||
Cerberus Purchase Agreement Back End Note (1) | |||||||||||
Principal outstanding | 22,000 | ||||||||||
Accrued interest outstanding | 743 | ||||||||||
Cerberus Purchase Agreement (2) | |||||||||||
Convertible Promissory Note issued, amount | $ 22,000 | ||||||||||
Net proceeds received | $ 20,000 | ||||||||||
Conversion of note, principal converted | 22,000 | ||||||||||
Conversion of note, accrued and unpaid interest converted | $ 2,199 | ||||||||||
Conversion price | $ 0.008 | ||||||||||
Conversion of note, shares issued | 3,023,338 | ||||||||||
Amortization expense recorded for remaining portion of debt discount | $ 5,011 | ||||||||||
Principal outstanding | 0 | 22,000 | |||||||||
Accrued interest outstanding | 1,271 | ||||||||||
Interest rate per annum | 8.00% | ||||||||||
LG Purchase Agreement (2) | |||||||||||
Convertible Promissory Note issued, amount | $ 65,625 | ||||||||||
Net proceeds received | $ 62,500 | ||||||||||
Conversion of note, principal converted | 65,625 | ||||||||||
Conversion of note, accrued and unpaid interest converted | $ 6,535 | ||||||||||
Conversion price | $ 0.0057 | ||||||||||
Conversion of note, shares issued | 12,718,484 | ||||||||||
Amortization expense recorded for remaining portion of debt discount | $ 18,229 | ||||||||||
Principal outstanding | 0 | 65,625 | |||||||||
Accrued interest outstanding | 3,792 | ||||||||||
Interest rate per annum | 8.00% | ||||||||||
LG Purchase Agreement (4) | |||||||||||
Convertible Promissory Note issued, amount | $ 32,813 | ||||||||||
Net proceeds received | $ 30,813 | ||||||||||
Conversion of note, principal converted | 32,813 | ||||||||||
Conversion of note, accrued and unpaid interest converted | $ 2,999 | ||||||||||
Conversion price | $ 0.00551 | ||||||||||
Conversion of note, shares issued | 6,499,359 | ||||||||||
Amortization expense recorded for remaining portion of debt discount | $ 24,137 | ||||||||||
Principal outstanding | 0 | 32,813 | |||||||||
Accrued interest outstanding | 569 | ||||||||||
Interest rate per annum | 8.00% | ||||||||||
St. George 2016 Notes (1) | |||||||||||
Convertible Promissory Note issued, amount | $ 555,000 | ||||||||||
Purchase price balance | 500,000 | ||||||||||
Transaction costs | 5,000 | ||||||||||
OID interest | 50,000 | ||||||||||
Purchase price received | 100,000 | ||||||||||
Amount recorded as convertible note payable | 115,000 | ||||||||||
Secured promissory notes issued, total | $ 400,000 | ||||||||||
Conversion of note, principal converted | 241,756 | ||||||||||
Conversion of note, accrued and unpaid interest converted | $ 21,249 | ||||||||||
Conversion price | $ 0.05 | $ 0.00564 | |||||||||
Conversion of note, shares issued | 46,631,979 | ||||||||||
Amortization expense recorded for remaining portion of debt discount | $ 474,584 | ||||||||||
Principal outstanding | 313,244 | 170,000 | |||||||||
Accrued interest outstanding | 1,946 | 1,933 | |||||||||
Interest rate per annum | 10.00% | ||||||||||
Interest rate per annum in occurrence of event of default | 22.00% | ||||||||||
LG Purchase Agreement (5) | |||||||||||
Convertible Promissory Note issued, amount | $ 32,813 | ||||||||||
Net proceeds received | $ 30,813 | ||||||||||
Interest rate per annum | 8.00% | ||||||||||
2016 Convertible Notes | |||||||||||
Conversion of note, principal converted | 32,813 | ||||||||||
Conversion of note, accrued and unpaid interest converted | $ 2,567 | ||||||||||
Conversion price | $ 0.005916 | ||||||||||
Conversion of note, shares issued | 5,980,387 | ||||||||||
Amortization expense recorded for remaining portion of debt discount | $ 29,443 | ||||||||||
Principal outstanding | 0 | 32,813 | |||||||||
Accrued interest outstanding | $ 117 | ||||||||||
Initial debt discount | 865,593 | ||||||||||
Initial derivative liability expense | 2,317,830 | ||||||||||
Initial Derivative Liability | $ 3,183,423 |
Convertible Debt - 2017 Convert
Convertible Debt - 2017 Convertible Notes (Details Narrative) - USD ($) | Aug. 08, 2017 | Feb. 03, 2017 | Dec. 20, 2017 | May 24, 2017 | Apr. 24, 2017 | Mar. 28, 2017 | Feb. 24, 2017 | Jan. 25, 2017 | Dec. 31, 2017 | Mar. 24, 2017 | Feb. 01, 2017 | Jan. 24, 2017 | Dec. 31, 2016 |
Initial debt discount | $ 494,193 | $ 257,034 | |||||||||||
LG Purchase Agreement 2017 (1) | |||||||||||||
Convertible Promissory Note issued, amount | $ 94,500 | ||||||||||||
Back end note issued | 94,500 | ||||||||||||
Net proceeds received | $ 90,000 | ||||||||||||
Conversion of note, principal converted | 34,500 | ||||||||||||
Conversion of note, accrued and unpaid interest converted | $ 665 | ||||||||||||
Conversion price | $ 0.00818 | ||||||||||||
Conversion of note, shares issued | 4,300,002 | ||||||||||||
Principal outstanding | $ 60,000 | ||||||||||||
Interest rate per annum | 8.00% | ||||||||||||
Cerberus Purchase Agreement 2017 (1) | |||||||||||||
Convertible Promissory Note issued, amount | 63,000 | ||||||||||||
Back end note issued | $ 63,000 | ||||||||||||
Net proceeds received | $ 60,000 | ||||||||||||
Conversion of note, principal converted | 28,000 | ||||||||||||
Conversion of note, accrued and unpaid interest converted | $ 1,117 | ||||||||||||
Conversion price | $ 0.00557 | ||||||||||||
Conversion of note, shares issued | 5,229,334 | ||||||||||||
Principal outstanding | $ 35,000 | ||||||||||||
Interest rate per annum | 8.00% | ||||||||||||
Power Up Purchase Agreement 2017 (1) | |||||||||||||
Convertible Promissory Note issued, amount | $ 140,000 | ||||||||||||
Net proceeds received | $ 136,500 | ||||||||||||
Interest rate per annum | 12.00% | ||||||||||||
LG Purchase Agreement 2017 (2) | |||||||||||||
Convertible Promissory Note issued, amount | $ 26,000 | ||||||||||||
Back end note issued | 26,000 | ||||||||||||
Net proceeds received | $ 24,000 | ||||||||||||
Principal outstanding | 26,000 | ||||||||||||
Interest rate per annum | 8.00% | ||||||||||||
Cerberus Purchase Agreement 2017 (2) | |||||||||||||
Convertible Promissory Note issued, amount | $ 17,500 | ||||||||||||
Back end note issued | 17,500 | ||||||||||||
Net proceeds received | $ 16,000 | ||||||||||||
Principal outstanding | 17,500 | ||||||||||||
Interest rate per annum | 8.00% | ||||||||||||
LG Purchase Agreement 2017 (3) | |||||||||||||
Convertible Promissory Note issued, amount | $ 52,000 | ||||||||||||
Back end note issued | $ 52,000 | ||||||||||||
Net proceeds received | $ 49,600 | ||||||||||||
Principal outstanding | 52,000 | ||||||||||||
Interest rate per annum | 8.00% | ||||||||||||
Cerberus Purchase Agreement 2017 (3) | |||||||||||||
Convertible Promissory Note issued, amount | $ 42,000 | ||||||||||||
Back end note issued | 42,000 | ||||||||||||
Net proceeds received | $ 40,000 | ||||||||||||
Principal outstanding | 42,000 | ||||||||||||
Interest rate per annum | 8.00% | ||||||||||||
LG Purchase Agreement 2017 (4) | |||||||||||||
Convertible Promissory Note issued, amount | $ 52,000 | ||||||||||||
Back end note issued | 52,000 | ||||||||||||
Net proceeds received | $ 49,600 | ||||||||||||
Principal outstanding | 52,000 | ||||||||||||
Interest rate per annum | 8.00% | ||||||||||||
Power Up Purchase Agreement 2017 (2) | |||||||||||||
Convertible Promissory Note issued, amount | $ 128,000 | ||||||||||||
Net proceeds received | $ 125,000 | ||||||||||||
Principal outstanding | 128,000 | ||||||||||||
St. George 2017 Notes (1) | |||||||||||||
Convertible Promissory Note issued, amount | $ 1,105,000 | ||||||||||||
Net proceeds received | $ 470,000 | ||||||||||||
2017 Convertible Notes | |||||||||||||
Initial debt discount | 1,824,991 | ||||||||||||
Initial derivative liability expense | 1,808,511 | ||||||||||||
Initial Derivative Liability | 3,633,502 | ||||||||||||
Amounts paid to redeem convertible notes | 419,699 | ||||||||||||
Amounts paid in excess of principal and interest due | $ 96,864 |
Derivative liabilities - Summar
Derivative liabilities - Summary of derivative liability balance (Details) - USD ($) | 12 Months Ended | |
Dec. 31, 2017 | Dec. 31, 2016 | |
Fair Value Change | $ (4,986,057) | $ (1,457,071) |
Notes | ||
Beginning Balance | 1,410,647 | |
Initial Derivative Liability | 3,633,502 | |
Fair Value Change | 1,571,986 | |
Reclassified to Additional paid-in capital | (2,184,277) | |
Reduction for debt assignment | (823,610) | |
Ending Balance | 3,608,250 | 1,410,647 |
Warrants | ||
Beginning Balance | 203,023 | |
Initial Derivative Liability | 415,313 | |
Fair Value Change | 1,190,244 | |
Reclassified to Additional paid-in capital | ||
Reduction for debt assignment | ||
Ending Balance | 1,808,580 | 203,023 |
Totals | ||
Beginning Balance | 1,613,670 | |
Initial Derivative Liability | 4,048,815 | |
Fair Value Change | 2,762,230 | |
Reclassified to Additional paid-in capital | (2,184,277) | |
Reduction for debt assignment | (823,610) | |
Ending Balance | 5,416,830 | 1,613,670 |
Totals (2) | ||
Beginning Balance | $ 1,613,767 | 167,014 |
Initial Derivative Liability | 4,114,649 | |
Fair Value Change | (1,791,988) | |
Reclassified to Additional paid-in capital | (84,057) | |
Reduction for debt assignment | (791,851) | |
Ending Balance | $ 1,613,767 |
Derivative liabilities - Fair v
Derivative liabilities - Fair value assumptions for derivative liabilities (Details) | 12 Months Ended | |
Dec. 31, 2017 | Dec. 31, 2016 | |
Commitment date | ||
Expected dividends | 0.00% | 0.00% |
Expected volatility, minimum | 199.00% | 243.00% |
Expected volatility, maximum | 361.00% | 268.00% |
Expected term, maximum | 12 months | 12 months |
Risk free interest, minimum | 0.65% | 0.44% |
Risk free interest, maximum | 1.78% | 0.68% |
Remeasurement date | ||
Expected dividends | 0.00% | 0.00% |
Expected volatility, minimum | 320.00% | |
Expected volatility, maximum | 331.00% | 246.00% |
Expected term, minimum | 3 months | 1 month |
Expected term, maximum | 12 months | 12 months |
Risk free interest, minimum | 1.51% | 0.48% |
Risk free interest, maximum | 1.79% | 0.85% |
Derivative liabilities - Fair47
Derivative liabilities - Fair value assumptions for warrants (Details) | 12 Months Ended |
Dec. 31, 2017 | |
Commitment date | |
Expected dividends | 0.00% |
Expected volatility, minimum | 203.00% |
Expected volatility, maximum | 384.00% |
Expected term, minimum | 3 years 10 months 13 days |
Expected term, maximum | 4 years 7 months 21 days |
Risk free interest, minimum | 1.72% |
Risk free interest, maximum | 2.05% |
Remeasurement date | |
Expected dividends | 0.00% |
Expected volatility, maximum | 320.00% |
Expected term, maximum | 3 years 10 months 2 days |
Risk free interest, maximum | 1.81% |
Related Party Transactions (Det
Related Party Transactions (Details Narrative) - USD ($) | Oct. 05, 2017 | Nov. 04, 2015 | Dec. 31, 2017 | Dec. 31, 2016 | Sep. 30, 2016 | Mar. 31, 2017 | Jan. 30, 2017 | Feb. 29, 2016 |
Officer compensation expense included in Administrative and Management Fees | $ 150,000 | $ 150,000 | ||||||
Amounts owed to officer included in due to related party | $ 35,479 | $ 54,246 | ||||||
Monthly payment to CEO for rights to rent and income generated from property owned by CEO | $ 8,000 | |||||||
Shares of common stock issued prior to agreemeent with CEO for prepayment of future rents | 5,000,000 | |||||||
Amounts due from 800 Commerce, Inc., a commonly controlled entity | $ 282,947 | |||||||
Shares of 800 Commerce, Inc. (now Petrogress, Inc.) stock accepted in settlement of amounts due | 1,102,462 | |||||||
Loss recognized from stock received | $ (282,947) | |||||||
Mr. Friedman | ||||||||
Annual compensation | $ 150,000 | |||||||
Common stock issued for services, shares | 10,000,000 | |||||||
Mr. Braune, former CEO | ||||||||
Annual compensation | $ 100,000 | |||||||
Restricted common stock issued, shares | 15,000,000 | |||||||
Restricted common stock issued, shares cancelled | (15,000,000) | |||||||
Additional common stock issued, shares | 12,500,000 | |||||||
Additional common stock issued, shares cancelled | (12,500,000) | |||||||
Dr. Holt | ||||||||
Restricted common stock issued, shares | 5,000,000 | |||||||
Restricted common stock issued, amount | $ 100,000 | |||||||
Restricted common stock issued, price per share | $ 0.02 | |||||||
Non-qualified stock option to purchase common stock, shares | 1,000,000 | |||||||
Non-qualified stock option to purchase common stock, price per share | $ 0.05 | |||||||
Option shares vested | 1,000,000 | |||||||
Stock compensation expense for stock option vested shares | $ 2,371 |
Common and Preferred Stock - Co
Common and Preferred Stock - Common stock issuances upon conversion of portions of convertible notes (Details) - USD ($) | Dec. 28, 2017 | Dec. 15, 2017 | Dec. 07, 2017 | Dec. 05, 2017 | Dec. 02, 2017 | Nov. 15, 2017 | Nov. 14, 2017 | Nov. 13, 2017 | Nov. 06, 2017 | Oct. 23, 2017 | Oct. 09, 2017 | Sep. 19, 2017 | Aug. 29, 2017 | Aug. 15, 2017 | Jul. 26, 2017 | Jul. 25, 2017 | Jul. 17, 2017 | Jun. 30, 2017 | Jun. 29, 2017 | Jun. 09, 2017 | Jun. 08, 2017 | Jun. 06, 2017 | May 25, 2017 | May 10, 2017 | Apr. 25, 2017 | Mar. 28, 2017 | Mar. 27, 2017 | Mar. 10, 2017 | Feb. 27, 2017 | Feb. 08, 2017 | Jan. 27, 2017 | Jan. 17, 2017 | Jan. 10, 2017 | Dec. 28, 2016 | Dec. 13, 2016 | Sep. 26, 2016 | Jul. 29, 2016 | Jul. 20, 2016 | Jul. 12, 2016 | Jul. 01, 2016 | Jun. 22, 2016 | Jun. 20, 2016 | Jun. 10, 2016 | Jun. 09, 2016 | Jun. 02, 2016 | May 23, 2016 | Mar. 17, 2016 | Mar. 08, 2016 | Mar. 07, 2016 | Dec. 31, 2017 | Dec. 31, 2016 |
Conversions of portions of Convertible Notes | |||||||||||||||||||||||||||||||||||||||||||||||||||
Principal conversion | $ 42,000 | $ 52,000 | $ 32,813 | $ 16,756 | $ 32,813 | $ 75,000 | $ 26,624 | $ 35,000 | $ 28,376 | $ 30,000 | $ 30,000 | $ 34,500 | $ 38,000 | $ 35,199 | $ 28,000 | $ 35,000 | $ 37,358 | $ 30,625 | $ 48,849 | $ 22,000 | $ 34,100 | $ 32,813 | $ 29,052 | $ 22,000 | $ 76,081 | $ 65,625 | $ 34,775 | $ 40,000 | $ 26,120 | $ 60,000 | $ 48,129 | $ 57,500 | $ 73,000 | $ 45,000 | $ 9,500 | $ 8,613 | $ 7,500 | $ 9,500 | $ 9,000 | $ 8,000 | $ 5,000 | $ 10,500 | $ 6,075 | $ 5,000 | $ 9,000 | $ 5,000 | $ 9,000 | $ 7,425 | $ 6,500 | $ 174,613 | |
Interest conversion | 2,209 | 889 | 2,567 | 1,105 | 453 | 4,833 | 428 | 2,240 | 6,624 | 802 | 710 | 665 | 558 | 409 | 1,117 | 3,575 | 733 | 2,960 | 1,151 | 1,500 | 900 | 2,999 | 947 | 2,199 | 4,752 | 3,697 | 3,255 | 3,630 | 2,171 | 5,050 | 3,914 | 4,562 | 5,664 | 3,511 | 400 | 629 | 801 | 995 | 927 | 805 | 973 | 1,003 | 1,134 | 479 | 848 | 460 | 696 | 928 | 489 | 16,772 | |
Total conversion | $ 44,209 | $ 52,889 | $ 35,380 | $ 17,861 | $ 33,266 | $ 79,833 | $ 27,052 | $ 37,240 | $ 35,000 | $ 30,802 | $ 30,710 | $ 35,165 | $ 38,558 | $ 35,608 | $ 29,117 | $ 38,575 | $ 38,091 | $ 33,585 | $ 50,000 | $ 23,500 | $ 35,000 | $ 35,811 | $ 30,000 | $ 24,199 | $ 80,833 | $ 69,322 | $ 38,030 | $ 43,630 | $ 28,291 | $ 65,050 | $ 52,043 | $ 62,062 | $ 78,664 | $ 48,511 | $ 9,900 | $ 9,242 | $ 8,301 | $ 10,495 | $ 9,927 | $ 8,805 | $ 5,973 | $ 11,503 | $ 7,209 | $ 5,479 | $ 9,848 | $ 5,460 | $ 9,696 | $ 8,353 | $ 6,989 | $ 191,385 | |
Conversion price | $ .006728 | $ .005916 | $ .005916 | $ .005640 | $ .005742 | $ .005742 | $ .005640 | $ .005858 | $ .005640 | $ .006090 | $ .007076 | $ 0.008178 | $ 0.005858 | $ 0.0058 | $ 0.005568 | $ 0.005568 | $ 0.00564 | $ 0.0058 | $ 0.00564 | $ .00551 | $ .00564 | $ 0.00551 | $ 0.00564 | $ 0.008 | $ 0.009744 | $ 0.01276 | $ 0.012876 | $ 0.01363 | $ 0.013804 | $ 0.012934 | $ 0.01276 | $ 0.01537 | $ 0.01595 | $ .015080 | $ .000754 | $ .001218 | $ .000081 | $ .000098 | $ .000986 | $ .001160 | $ .001450 | $ .001450 | $ .001798 | $ .001798 | $ .002378 | $ .002436 | $ .002436 | $ .00174 | $ .00174 | ||
Shares Issued | 6,570,945 | 8,939,991 | 5,980,387 | 3,166,816 | 5,793,378 | 13,903,322 | 4,796,452 | 6,357,188 | 6,205,674 | 5,057,830 | 4,340,042 | 4,300,002 | 6,582,115 | 6,139,276 | 5,229,334 | 6,927,943 | 6,753,817 | 5,790,541 | 8,865,248 | 4,264,903 | 6,205,674 | 6,499,359 | 5,319,149 | 3,023,338 | 8,295,680 | 5,432,725 | 2,953,523 | 3,200,997 | 2,049,467 | 5,029,369 | 4,078,598 | 4,037,878 | 4,931,912 | 3,216,925 | 13,129,683 | 7,587,824 | 10,222,352 | 10,644,310 | 10,068,073 | 7,590,362 | 4,119,414 | 7,933,377 | 4,009,701 | 3,047,219 | 4,141,387 | 2,241,490 | 3,980,431 | 4,800,354 | 4,016,471 | 114,327,117 | |
Issued to | Cerberus | LG | LG | St Georges | LG | LG | St Georges | Cerberus | St Georges | LG | LG | LG | LG | LG | Cerberus | LG | St Georges | LG | St Georges | Cerberus | St Georges | LG | St Georges | Cerberus | LG | LG | Cerberus | LG | Cerberus | LG | Cerberus | LG | Cerberus | LG | Cerberus | LG | LG | LG | LG | LG | GW | Cerberus | GW | LG | Cerberus | LG | LG | GW | LG | ||
Conversions of portions of Convertible Notes (2) | |||||||||||||||||||||||||||||||||||||||||||||||||||
Principal conversion | $ 19,500 | $ 20,640 | $ 5,000 | $ 3,000 | |||||||||||||||||||||||||||||||||||||||||||||||
Interest conversion | 1,218 | 9,360 | 967 | 138 | |||||||||||||||||||||||||||||||||||||||||||||||
Total conversion | $ 20,718 | $ 30,000 | $ 5,967 | $ 3,138 | |||||||||||||||||||||||||||||||||||||||||||||||
Conversion price | $ .005858 | $ 0.0075 | $ .001450 | $ .000638 | |||||||||||||||||||||||||||||||||||||||||||||||
Shares Issued | 3,536,715 | 4,000,000 | 4,114,879 | 4,918,624 | |||||||||||||||||||||||||||||||||||||||||||||||
Issued to | LG | St Georges | GW | Service | |||||||||||||||||||||||||||||||||||||||||||||||
Conversions of portions of Convertible Notes | |||||||||||||||||||||||||||||||||||||||||||||||||||
Principal conversion | $ 1,350,247 | ||||||||||||||||||||||||||||||||||||||||||||||||||
Interest conversion | 89,846 | ||||||||||||||||||||||||||||||||||||||||||||||||||
Total conversion | $ 1,440,093 | ||||||||||||||||||||||||||||||||||||||||||||||||||
Shares Issued | 194,559,520 | ||||||||||||||||||||||||||||||||||||||||||||||||||
Conversions of portions of Convertible Notes (3) | |||||||||||||||||||||||||||||||||||||||||||||||||||
Principal conversion | $ 6,000 | ||||||||||||||||||||||||||||||||||||||||||||||||||
Interest conversion | 589 | ||||||||||||||||||||||||||||||||||||||||||||||||||
Total conversion | $ 6,589 | ||||||||||||||||||||||||||||||||||||||||||||||||||
Conversion price | $ .001450 | ||||||||||||||||||||||||||||||||||||||||||||||||||
Shares Issued | 4,544,241 | ||||||||||||||||||||||||||||||||||||||||||||||||||
Issued to | LG |
Common and Preferred Stock - Ac
Common and Preferred Stock - Activity related to warrants (Details) - $ / shares | 12 Months Ended | |
Dec. 31, 2017 | Dec. 31, 2016 | |
Outstanding | ||
Warrants outstanding, beginning | 300,000 | |
Weighted-average exercise price per share | $ 0.05 | |
Weighted-average remaining life | 3 years | |
Warrants issued | ||
Warrants issued | 40,573,870 | 16,926,130 |
Weighted-average exercise price per share | $ 0.00564 | $ 0.00564 |
Warrants expired | ||
Warrants expired | (300,000) | |
Weighted-average exercise price per share, expired | $ (0.05) | |
Outstanding and exercisable | ||
Warrants outstanding and exercisable | 49,135,892 | 17,926,130 |
Weighted-average exercise price per share | $ 0.00654 | $ 0.0811 |
Weighted-average remaining life | 4 years 2 months 1 day | 4 years 10 months 17 days |
Warrants exercised | ||
Warrants exercised | (9,364,108) | |
Weighted-average exercise price per share | $ 0.00564 |
Common and Preferred Stock - 51
Common and Preferred Stock - Common Stock (Details Narrative) - USD ($) | 12 Months Ended | |||||
Dec. 31, 2017 | Aug. 08, 2017 | Jun. 19, 2017 | Jan. 30, 2017 | Jan. 27, 2017 | Jan. 16, 2017 | |
Business Consultant Agreement issuances | ||||||
Common stock issued, shares | 5,000,000 | |||||
Common stock issued, price per share | $ 0.03 | |||||
Stock compensation expense recorded | $ 150,000 | |||||
Kopelowitz Ostrow P.A. issuances | ||||||
Issuance of restricted common stock, shares | 1,000,000 | |||||
Debt forgiveness amount pursuant to Debt Settlement | $ (24,614) | |||||
Venture Equity issuances | ||||||
Stock compensation expense recorded | $ 16,831 | |||||
Issuance of shares of common stock | 1,000,000 | |||||
Cancellation of accrued and unpaid fees | $ (13,169) | |||||
Company's CEO issuances | ||||||
Common stock issued, shares | 10,000,000 | |||||
Common stock issued, price per share | $ 0.03 | |||||
Stock compensation expense recorded | $ 300,000 | |||||
St. George Note Issuances | ||||||
Issuance of shares of common stock | 1,319,149 | |||||
Issuance of shares pursuant to Notices of Exercise of Warrant received | 87,934,231 | |||||
Company's COO issuances | ||||||
Common stock issued, shares | 2,000,000 | |||||
Common stock issued, price per share | $ 0.0123 | |||||
Stock compensation expense recorded | $ 24,600 | |||||
Property Rent Prepayment | ||||||
Common stock issued, shares | 5,000,000 | |||||
Common stock issued, price per share | $ 0.0123 | |||||
Deferred expenses included | $ 61,500 |
Common and Preferred Stock - Pr
Common and Preferred Stock - Preferred Stock (Details Narrative) - shares | Dec. 31, 2017 | Dec. 31, 2016 | Jun. 26, 2015 |
Common And Preferred Stock - Preferred Stock Details Narrative | |||
Preferred stock, shares issued to Mr. B Michael Friedman | 1,000 | ||
Preferred stock, shares outstanding | 1,000 | 1,000 |
Common and Preferred Stock - Wa
Common and Preferred Stock - Warrants (Details Narrative) - USD ($) | Apr. 14, 2015 | Dec. 31, 2016 | Dec. 14, 2016 | Apr. 26, 2013 |
Payments received from St. George upon Warrants becoming effective | $ 50,000 | |||
Dr. Holt | ||||
Non-qualified stock option to purchase common stock, shares | 1,000,000 | |||
Non-qualified stock option to purchase common stock, price per share | $ 0.05 | |||
Option shares vested | 1,000,000 | |||
Stock compensation expense for stock option vested shares | $ 2,317 | |||
Warrant expiration date | Apr. 14, 2018 | |||
Mr. Canton | ||||
Warrant to purchase common stock issued, shares available for purchase | 300,000 |
Income Taxes - Components of in
Income Taxes - Components of income tax rate reconciliation (Details) - USD ($) | 12 Months Ended | |
Dec. 31, 2017 | Dec. 31, 2016 | |
Income Tax Disclosure [Abstract] | ||
Net tax loss carry-forwards | $ 7,878,733 | $ 5,836,000 |
Statutory rate | 37.60% | 37.60% |
Expected tax recovery | $ 2,962,404 | $ 2,194,336 |
Change in valuation allowance | (2,962,404) | (2,194,336) |
Income tax provision | ||
Components of deferred tax asset: | ||
Non capital tax loss carry forwards | 2,962,404 | 2,194,336 |
Less: valuation allowance | (2,962,404) | (2,194,336) |
Net deferred tax asset |
Income Taxes (Details Narrative
Income Taxes (Details Narrative) | Dec. 31, 2017USD ($) |
Income Tax Disclosure [Abstract] | |
Net operating loss carry forwards | $ 491,107 |
Commitments and Contingencies (
Commitments and Contingencies (Details Narrative) | 1 Months Ended | 3 Months Ended | 8 Months Ended | 9 Months Ended | 10 Months Ended | 12 Months Ended | 24 Months Ended | 120 Months Ended | ||||
Feb. 28, 2017USD ($) | Feb. 28, 2017USD ($) | Dec. 31, 2017USD ($) | Nov. 30, 2017USD ($) | Dec. 31, 2017USD ($) | Dec. 31, 2017USD ($) | Dec. 31, 2016USD ($) | Mar. 31, 2016USD ($) | Jul. 10, 2024USD ($) | Apr. 28, 2024 | Jul. 11, 2014a | Apr. 28, 2014a | |
Rent expense | $ 101,279 | $ 40,303 | ||||||||||
Land leased | a | 40 | 20 | ||||||||||
Expense recorded in leased property expenses | 38,244 | 38,244 | ||||||||||
Lease agreement term | 10 years | 10 years | ||||||||||
Lease agreement monthly rent payments during first year | $ 10,000 | |||||||||||
Lease agreement annual increase percentage | 2.00% | |||||||||||
Tenant water rights provided by lease, acres | a | 50 | |||||||||||
Tenant water rights provided by lease, annual price | $ 50,000 | |||||||||||
Tenant water rights provided by lease, approximate annual additional cost | $ 2,400 | |||||||||||
Expenses related to the land and water rights | $ 0 | $ 76,650 | ||||||||||
Sublease agreement with Colorado research facility | ||||||||||||
Rent for office space, monthly | $ 3,500 | |||||||||||
Amounts owed to landlord | $ 48,750 | |||||||||||
Office space in San Juan, Puerto Rico (1) | ||||||||||||
Rent for office space, monthly | $ 800 | $ 900 | ||||||||||
First floor of San Juan, Puerto Rico office (2) | ||||||||||||
Rent for office space, monthly | $ 1,500 | $ 3,000 | ||||||||||
Second floor of San Juan, Puerto Rico office (2) | ||||||||||||
Rent for office space, monthly | $ 2,000 |
Going Concern (Details Narrativ
Going Concern (Details Narrative) - USD ($) | Dec. 31, 2017 | Dec. 31, 2016 |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | ||
Accumulated deficit | $ (25,578,077) | $ (16,424,767) |
Working capital deficit | (6,672,693) | |
Derivative liability included in working capital deficit | $ (5,416,830) |
Subsequent Events (Details Narr
Subsequent Events (Details Narrative) - USD ($) | Mar. 28, 2018 | Mar. 20, 2018 | Feb. 27, 2018 | Feb. 12, 2018 | Feb. 02, 2018 | Jan. 23, 2018 | Jan. 12, 2018 | Jan. 10, 2018 | Jan. 09, 2018 | Jan. 05, 2018 | Jan. 02, 2018 |
Subsequent Events [Abstract] | |||||||||||
Common stock issued upon exercise of warrant, shares | 8,000,000 | 5,550,000 | 7,500,000 | 4,870,000 | 2,631,579 | ||||||
Proceeds received pursuant to Stock Pruchase Agreement | $ 90,000 | $ 100,000 | $ 100,000 | $ 50,000 | |||||||
Secured promissory note funded | $ 75,000 | 200,000 | |||||||||
Convertible note payable recorded | 220,000 | ||||||||||
OID interest recorded | $ 20,000 | ||||||||||
Amounts paid to redeem remaining convertible notes | $ 236,817 | ||||||||||
Common stock issued upon conversion of principal and interest, shares | 8,865,248 | 13,297,872 | |||||||||
Common stock issued upon conversion of principal and interest, amount | $ 50,000 | $ 75,000 | |||||||||
Common stock issued upon conversion of principal and interest, price per share | $ 0.00564 | $ 0.00564 |