Document and Entity Information
Document and Entity Information - shares | 6 Months Ended | |
Jun. 30, 2016 | Aug. 09, 2016 | |
Document And Entity Information | ||
Entity Registrant Name | ORBITAL TRACKING CORP. | |
Entity Central Index Key | 1,058,307 | |
Document Type | 10-Q | |
Document Period End Date | Jun. 30, 2016 | |
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 Common Stock, Shares Outstanding | 36,144,414 | |
Document Fiscal Period Focus | Q2 | |
Document Fiscal Year Focus | 2,016 |
CONDENSED CONSOLIDATED BALANCE
CONDENSED CONSOLIDATED BALANCE SHEETS (Unaudited) - USD ($) | Jun. 30, 2016 | Dec. 31, 2015 |
Current Assets | ||
Cash | $ 135,142 | $ 963,329 |
Accounts receivable, net | 179,916 | 116,718 |
Inventory | 289,522 | 251,518 |
Unbilled revenue | 60,056 | 65,762 |
Prepaid expenses - current portion | 238,137 | 191,677 |
Other current assets | 42,297 | 43,345 |
Total Current Assets | 945,070 | 1,632,349 |
Property and equipment, net | 2,115,692 | 2,218,693 |
Intangible Assets, net | 262,500 | 275,000 |
Prepaid expenses - long-term portion | 80,137 | 189,968 |
Total Assets | 3,403,399 | 4,316,010 |
Current Liabilities | ||
Accounts payable and accrued liabilities | 641,573 | 610,232 |
Deferred revenue | 0 | 16,661 |
Related party payable | 85,622 | 74,051 |
Derivative liabilities – current portion | 2,484 | 311,373 |
Convertible note payable – current portion, net of unamortized discount | 0 | 2,486 |
Liabilities for discontinued operations | 112,397 | 112,397 |
Total Current Liabilities | 842,076 | 1,127,200 |
Derivative liabilities – long term portion | 0 | 307,018 |
Total liabilities | 842,076 | 1,434,218 |
Stockholders' Deficit | ||
Preferred Stock, $0.0001 par value; 50,000,000 shares authorized | 0 | 0 |
Common Shares, $0.0001 par value; 750,000,000 shares authorized, 34,213,004 and 19,252,082 outstanding as of June 30, 2016 and December 31, 2015, respectively | 3,421 | 1,925 |
Additional paid-in capital | 5,695,119 | 4,901,839 |
Accumulated (deficit) | (3,125,274) | (2,011,483) |
Accumulated other comprehensive loss | (14,638) | (12,263) |
Total stockholders' equity | 2,561,323 | 2,881,792 |
Total liabilities and stockholders' Deficit | 3,403,399 | 4,316,010 |
Preferred stock, Series C | ||
Stockholders' Deficit | ||
Preferred Stock, $0.0001 par value; 50,000,000 shares authorized | 319 | 334 |
Preferred stock, Series E | ||
Stockholders' Deficit | ||
Preferred Stock, $0.0001 par value; 50,000,000 shares authorized | 851 | 862 |
Series A Preferred Stock | ||
Stockholders' Deficit | ||
Preferred Stock, $0.0001 par value; 50,000,000 shares authorized | 0 | 0 |
Preferred stock, Series B | ||
Stockholders' Deficit | ||
Preferred Stock, $0.0001 par value; 50,000,000 shares authorized | 1 | 1 |
Series D Preferred Stock | ||
Stockholders' Deficit | ||
Preferred Stock, $0.0001 par value; 50,000,000 shares authorized | 406 | 467 |
Preferred stock, Series F | ||
Stockholders' Deficit | ||
Preferred Stock, $0.0001 par value; 50,000,000 shares authorized | 110 | 110 |
Preferred stock, Series G | ||
Stockholders' Deficit | ||
Preferred Stock, $0.0001 par value; 50,000,000 shares authorized | $ 1,008 | $ 0 |
CONDENSED CONSOLIDATED BALANCE3
CONDENSED CONSOLIDATED BALANCE SHEETS (Parenthetical) - $ / shares | Jun. 30, 2016 | Dec. 31, 2015 |
Preferred stock, par value | $ 0.0001 | |
Preferred stock, shares authorized | 50,000,000 | |
Common stock, par value | $ .0001 | $ .0001 |
Common stock, shares authorized | 750,000,000 | 750,000,000 |
Common stock, shares issued | 34,213,004 | 19,252,082 |
Common stock, shares outstanding | 19,252,082 | 19,252,082 |
Series A Preferred Stock | ||
Preferred stock, par value | $ 0.0001 | $ 0.0001 |
Preferred stock, shares authorized | 20,000 | 20,000 |
Preferred stock, shares issued | 0 | 0 |
Preferred stock, shares outstanding | 0 | 0 |
Preferred stock, Series B | ||
Preferred stock, par value | $ 0.0001 | $ .0001 |
Preferred stock, shares authorized | 30,000 | 30,000 |
Preferred stock, shares issued | 6,667 | 6,667 |
Preferred stock, shares outstanding | 6,667 | 6,667 |
Preferred stock, Series C | ||
Preferred stock, par value | $ 0.0001 | $ 0.0001 |
Preferred stock, shares authorized | 4,000,000 | 4,000,000 |
Preferred stock, shares issued | 3,190,365 | 3,337,442 |
Preferred stock, shares outstanding | 3,337,442 | 3,337,442 |
Series D Preferred Stock | ||
Preferred stock, par value | $ 0.0001 | $ 0.0001 |
Preferred stock, shares authorized | 5,000,000 | 5,000,000 |
Preferred stock, shares issued | 4,063,843 | 4,673,010 |
Preferred stock, shares outstanding | 4,673,010 | 4,673,010 |
Preferred stock, Series E | ||
Preferred stock, par value | $ 0.0001 | $ 0.0001 |
Preferred stock, shares authorized | 8,746,000 | 8,746,000 |
Preferred stock, shares issued | 8,504,569 | 8,621,589 |
Preferred stock, shares outstanding | 8,621,589 | 8,621,589 |
Preferred stock, Series F | ||
Preferred stock, par value | $ 0.0001 | $ 0.0001 |
Preferred stock, shares authorized | 1,100,000 | 1,100,000 |
Preferred stock, shares issued | 1,099,998 | 1,099,998 |
Preferred stock, shares outstanding | 1,099,998 | 1,099,998 |
UNAUDITED CONDENSED CONSOLIDATE
UNAUDITED CONDENSED CONSOLIDATED STATEMENT OF OPERATIONS AND COMPREHENSIVE (LOSS) INCOME (Unaudited) - USD ($) | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2016 | Jun. 30, 2015 | Jun. 30, 2016 | Jun. 30, 2015 | |
Income Statement [Abstract] | ||||
Net sales | $ 1,188,593 | $ 1,188,867 | $ 2,483,857 | $ 1,972,677 |
Cost of sales | 983,040 | 864,787 | 1,839,960 | 1,432,409 |
Gross profit | 205,553 | 324,080 | 643,897 | 540,268 |
Operating Expenses | ||||
Selling, general and administrative | 182,475 | 245,463 | 367,250 | 457,493 |
Salaries, wages and payroll taxes | 170,981 | 123,454 | 344,836 | 139,154 |
Stock based compensation | 0 | 0 | 0 | 151,563 |
Professional fees | 387,916 | 63,591 | 688,484 | 258,002 |
Depreciation and amortization | 63,334 | 103,970 | 146,156 | 174,430 |
Total operating expenses | 804,706 | 536,478 | 1,546,726 | 1,180,642 |
(Loss) before other expenses and income taxes | (599,173) | (212,398) | (902,829) | (640,374) |
Other (income) expense | ||||
Change in fair value of derivative instruments, net | 39,659 | 71 | (424,846) | (162) |
Interest expense | 527,108 | 2,321 | 602,986 | 2,321 |
Foreign currency exchange rate variance | 7,817 | 83 | 32,822 | 12,068 |
Total other (income) expense | 574,584 | 2,475 | 210,962 | 14,227 |
Net loss | (1,173,757) | (214,873) | (1,113,791) | (654,601) |
Comprehensive Income (loss): | ||||
Net loss | (1,173,757) | (214,873) | (1,113,791) | (654,601) |
Foreign currency translation adjustments | 4,413 | 6,064 | (2,375) | 5,640 |
Comprehensive loss | $ (1,169,342) | $ (208,809) | $ (1,116,166) | $ (648,961) |
NET INCOME (LOSS) ATTRIBUTABLE TO COMON STOCKHOLDERS | ||||
Weighted average number of common shares outstanding - basic | 27,667,167 | 11,068,172 | 24,190,850 | 8,742,059 |
Weighted average number of common shares outstanding - diluted | 27,667,167 | 11,068,172 | 24,190,850 | 8,742,059 |
Basic net (loss) per share | $ (0.04) | $ (0.02) | $ (0.06) | $ (0.07) |
Diluted net (loss) per share | $ (0.04) | $ (0.02) | $ (0.06) | $ (0.07) |
UNAUDITED CONDENSED CONSOLIDAT5
UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) | 6 Months Ended | |
Jun. 30, 2016 | Jun. 30, 2015 | |
CASH FLOWS FROM OPERATING ACTIVITIES: | ||
Net income (loss) | $ (1,113,791) | $ (654,601) |
Adjustments to reconcile net income (loss) to net cash (used in) provided by operating activities: | ||
Change in fair value of derivative liabilities | (424,846) | (162) |
Depreciation expense | 133,656 | 29,515 |
Amortization of intangible asset | 12,500 | 12,500 |
Amortization of notes payable discount | 602,515 | |
Fair value of option issued | 0 | 111,111 |
Stock based compensation | 0 | 150,000 |
Amortization of prepaid expense in connection with the issuance of common stock issued for prepaid services | 164,608 | 21,304 |
Imputed interest | 471 | 2,321 |
Changes in operating assets and liabilities: | ||
Accounts receivable | (63,198) | (44,801) |
Inventory | (38,004) | (73,018) |
Unbilled revenue | 5,705 | (26,917) |
Prepaid expense | (1,237) | 0 |
Other current assets | 1,047 | (4,492) |
Accounts payable and accrued expenses | 31,342 | 203,139 |
Deferred revenue | (16,662) | (26,875) |
Net Cash (used in) operating activities | (705,892) | (300,977) |
CASH FLOWS FROM INVESTING ACTIVITIES: | ||
Cash acquired from acquisition | 0 | 30,934 |
Purchase of property and equipment | (30,654) | (57,716) |
Cash paid per Share Exchange Agreement | 0 | (375,000) |
Net cash (used in) investing activities | (30,654) | (401,782) |
CASH FLOWS FROM FINANCING ACTIVITIES: | ||
Proceeds from common stock and preferred stock sales | 0 | 1,097,500 |
Payments on notes payable | (100,834) | 0 |
Repayments of note payable, related party, net | 11,571 | (60,074) |
Net cash (used in) provided by financing activities | (89,263) | 1,037,426 |
Net increase (decrease) in cash | (828,187) | 340,307 |
Cash beginning of period | 963,329 | 65,982 |
Cash end of period | 135,142 | 406,199 |
SUPPLEMENTAL CASH FLOW INFORMATION | ||
Cash paid during the period for interest | 0 | 0 |
Cash paid during the period for income tax | 0 | 0 |
NON CASH FINANCE AND INVESTING ACTIVITY | ||
Notes payable issued per Share Exchange Agreement | 0 | 122,536 |
Common stock issued for intellectual property | 0 | 50,000 |
Common stock issued for prepaid services | 100,000 | 143,500 |
Preferred stock issued for settlement of debt | $ 650,670 | $ 175,000 |
BASIS OF PRESENTATION AND SUMMA
BASIS OF PRESENTATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | 6 Months Ended |
Jun. 30, 2016 | |
Accounting Policies [Abstract] | |
Note 1 - BASIS OF PRESENTATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | The accompanying unaudited condensed interim financial statements have been prepared in accordance with accounting principles generally accepted in the United States for interim financial statements and do not include all the information and footnotes required by accounting principles generally accepted in the United States for complete financial statements. The information furnished reflects all adjustments, consisting only of normal recurring items which are, in the opinion of management, necessary in order to make the financial statements not misleading. The consolidated financial statements as of December 31, 2015 have been audited by an independent registered public accounting firm. The accounting policies and procedures employed in the preparation of these condensed consolidated financial statements have been derived from the audited financial statements of the Company for the year ended December 31, 2015, which are contained in Form 10-K as filed with the Securities and Exchange Commission on March 30, 2016. The consolidated balance sheet as of December 31, 2015 was derived from those financial statements. Basis of Presentation and Principles of Consolidation The unaudited condensed consolidated financial statements are prepared in accordance with generally accepted accounting principles in the United States of America ("US GAAP") and the rules and regulations of the U.S Securities and Exchange Commission for Interim Financial Information. All intercompany transactions and balances have been eliminated. All adjustments (consisting of normal recurring items) necessary to present fairly the Company's financial position as of June 30, 2016, and the results of operations and cash flows for the six months ended June 30, 2016 have been included. The results of operations for the three and six months ended June 30, 2016 are not necessarily indicative of the results to be expected for the full year. Description of Business Orbital Tracking Corp. (the Company) was formerly Great West Resources, Inc., a Nevada corporation. The Company, through its wholly owned subsidiaries, Global Telesat Communications Limited (GTCL) and Orbital Satcom Corp. (Orbital Satcom) is a provider of satellite based hardware, airtime and related services both in the United States and internationally. The Companys principal focus is on growing the Companys existing satellite based hardware, airtime and related services business line and developing the Companys own tracking devices for use by retail customers worldwide. Going Concern Considerations The accompanying The condensed Use of Estimates In preparing the consolidated financial statements, management is required to make estimates and assumptions that affect the reported amounts of assets and liabilities as of the date of the statements of financial condition, and revenues and expenses for the years then ended. Actual results may differ significantly from those estimates. Significant estimates made by management include, but are not limited to, the assumptions used to calculate stock-based compensation, derivative liabilities, preferred deemed dividend and common stock issued for services. Cash and Cash Equivalents The Company considers all highly liquid investments with a maturity of six months or less when acquired to be cash equivalents. The Company places its cash with a high credit quality financial institution. The Companys account at this institution is insured by the Federal Deposit Insurance Corporation (FDIC) up to $250,000. To reduce its risk associated with the failure of such financial institution, the Company evaluates at least annually the rating of the financial institution in which it holds deposits. Accounts receivable and allowance for doubtful accounts The Company has a policy of reserving for questionable accounts based on its best estimate of the amount of probable credit losses in its existing accounts receivable. The Company periodically reviews its accounts receivable to determine whether an allowance is necessary based on an analysis of past due accounts and other factors that may indicate that the realization of an account may be in doubt. Account balances deemed to be uncollectible are charged to the bad debt expense after all means of collection have been exhausted and the potential for recovery is considered remote. As of June 30, 2016 and December 31, 2015, there is an allowance for doubtful accounts of $0 and $0. Foreign Currency Translation The Companys reporting currency is US Dollars. The accounts of one of the Companys subsidiaries is maintained using the appropriate local currency, (Great British Pound) GTCL as the functional currency. All assets and liabilities are translated into U.S. Dollars at balance sheet date, shareholders' equity is translated at historical rates and revenue and expense accounts are translated at the average exchange rate for the year or the reporting period. The translation adjustments are deferred as a separate component of stockholders equity, captioned as accumulated other comprehensive (loss) gain. Transaction gains and losses arising from exchange rate fluctuation on transactions denominated in a currency other than the functional currency are included in the statements of operations. The Revenue Recognition and Unearned Revenue The Company recognizes revenue from satellite services when earned, as services are rendered or delivered to customers. Equipment sales revenue is recognized when the equipment is delivered to and accepted by the customer. Only equipment sales are subject to warranty. Historically, the Company has not incurred significant expenses for warranties. The Companys customers generally purchase a combination of our products and services as part of a multiple element arrangement. The Companys assessment of which revenue recognition guidance is appropriate to account for each element in an arrangement can involve significant judgment. This assessment has a significant impact on the amount and timing of revenue recognition. Revenue is recognized when all of the following criteria have been met: ● Persuasive evidence of an arrangement exists. Contracts and customer purchase orders are generally used to determine the existence of an arrangement. ● Delivery has occurred. Shipping documents and customer acceptance, when applicable, are used to verify delivery. ● The fee is fixed or determinable. We assess whether the fee is fixed or determinable based on the payment terms associated with the transaction and whether the sales price is subject to refund or adjustment. ● Collectability is reasonably assured. We assess collectability based primarily on the creditworthiness of the customer as determined by credit checks and analysis, as well as the customers payment history. In accordance with ASC 605-25, Revenue Recognition Multiple-Element Arrangements, Goodwill and other intangible assets In accordance with ASC 350-30-65, Intangibles - Goodwill and Others, the Company assesses the impairment of identifiable intangibles whenever events or changes in circumstances indicate that the carrying value may not be recoverable. Factors the Company considers to be important which could trigger an impairment review include the following: 1. Significant underperformance relative to expected historical or projected future operating results; 2. Significant changes in the manner of use of the acquired assets or the strategy for the overall business; and 3. Significant negative industry or economic trends. When the Company determines that the carrying value of intangibles may not be recoverable based upon the existence of one or more of the above indicators of impairment and the carrying value of the asset cannot be recovered from projected undiscounted cash flows, the Company records an impairment charge. The Company measures any impairment based on a projected discounted cash flow method using a discount rate determined by management to be commensurate with the risk inherent in the current business model. Significant management judgment is required in determining whether an indicator of impairment exists and in projecting cash flows. Property and Equipment Property and equipment are carried at historical cost less accumulated depreciation. Depreciation is based on the estimated service lives of the depreciable assets and is calculated using the straight-line method. Expenditures that increase the value or productive capacity of assets are capitalized. Fully depreciated assets are retained in the property and equipment, and accumulated depreciation accounts until they are removed from service. When property and equipment are retired, sold or otherwise disposed of, the assets carrying amount and related accumulated depreciation are removed from the accounts and any gain or loss is included in operations. Repairs and maintenance are expensed as incurred. The estimated useful lives of property and equipment are generally as follows: Years Office furniture and fixtures 4 Computer equipment 4 Appliques 10 Website development 2 Impairment of long-lived assets The Company reviews long-lived assets for impairment whenever events or changes in circumstances indicate that the carrying amount of the assets may not be fully recoverable, or at least annually. The Company recognizes an impairment loss when the sum of expected undiscounted future cash flows is less than the carrying amount of the asset. The amount of impairment is measured as the difference between the assets estimated fair value and its book value. The Company did not consider it necessary to record any impairment charges during the periods ended June 30, 2016 and December 31, 2015, respectively. Fair value of financial instruments The Company adopted Financial Accounting Standards Board (FASB) Accounting Standards Codification (ASC) 820, Fair Value Measurements and Disclosures, for assets and liabilities measured at fair value on a recurring basis. ASC 820 establishes a common definition for fair value to be applied to existing US GAAP that require the use of fair value measurements which establishes a framework for measuring fair value and expands disclosure about such fair value measurements. ASC 820 defines fair value as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. Additionally, ASC 820 requires the use of valuation techniques that maximize the use of observable inputs and minimize the use of unobservable inputs. These inputs are prioritized below: Level 1: Observable inputs such as quoted market prices in active markets for identical assets or liabilities Level 2: Observable market-based inputs or unobservable inputs that are corroborated by market data Level 3: Unobservable inputs for which there is little or no market data, which require the use of the reporting entitys own assumptions. The following table presents a reconciliation of the derivative liability measured at fair value on a recurring basis using significant unobservable input (Level 3) from January 1, 2016 to June 30, 2016: Conversion Feature Derivative Liability Warrant Liability Total Balance at January 1, 2016 $ 614,036 $ 4,355 $ 618,391 Change in fair value included in earnings (422,974) (1,871) (424,846) Net effect on additional paid in capital (191,062) - (191,062) Balance June 30, 2016 $ - $ 2,484 $ 2,484 The Company did not identify any other assets or liabilities that are required to be presented on the consolidated balance sheets at fair value in accordance with the accounting guidance. The carrying amounts reported in the balance sheet for cash, accounts payable, and accrued expenses approximate their estimated fair market value based on the short-term maturity of the instruments. Stock Based Compensation Stock-based compensation is accounted for based on the requirements of the Share-Based Payment Topic of ASC 718 which requires recognition in the consolidated financial statements of the cost of employee and director services received in exchange for an award of equity instruments over the period the employee or director is required to perform the services in exchange for the award (presumptively, the vesting period). The ASC also requires measurement of the cost of employee and director services received in exchange for an award based on the grant-date fair value of the award. Pursuant to ASC Topic 505-50, for share-based payments to consultants and other third-parties, compensation expense is determined at the measurement date. The expense is recognized over the vesting period of the award. Until the measurement date is reached, the total amount of compensation expense remains uncertain. The Company initially records compensation expense based on the fair value of the award at the reporting date. Income Taxes The Company has adopted Accounting Standards Codification subtopic 740-10, Income Taxes U.S. GAAP requires that, in applying the liability method, the financial statement effects of an uncertain tax position be recognized based on the outcome that is more likely than not to occur. Under this criterion the most likely resolution of an uncertain tax position should be analyzed based on technical merits and on the outcome that will likely be sustained under examination. There were no adjustments related to uncertain tax positions recognized during the six months ended June 30, 2016 and the year ended December 31, 2015, respectively. Earnings per Common Share Net income (loss) per common share is calculated in accordance with ASC Topic 260: Earnings per Share (ASC 260). Basic income (loss) per share is computed by dividing net income (loss) by the weighted average number of shares of common stock outstanding during the period. The computation of diluted net loss per share does not include dilutive common stock equivalents in the weighted average shares outstanding as they would be anti-dilutive. For the six months ended June 30, 2016, where the Company had net income, therefore weighted average number of shares dilutive are noted. For the six months ended June 30, 2015, periods where the Company has a net loss, all dilutive securities are excluded. The following are dilutive common stock equivalents during the period ended: June 30, June 30, 2016 2015 Convertible preferred stock 209,416,215 220,887,750 Stock options 2,850,000 2,150,000 Stock warrants 5,000 5,000 Total 212,271,215 223,042,750 Related Party Transactions A party is considered to be related to the Company if the party directly or indirectly or through one or more intermediaries, controls, is controlled by, or is under common control with the Company. Related parties also include principal owners of the Company, its management, members of the immediate families of principal owners of the Company and its management and other parties with which the Company may deal if one party controls or can significantly influence the management or operating policies of the other to an extent that one of the transacting parties might be prevented from fully pursuing its own separate interests. A party which can significantly influence the management or operating policies of the transacting parties or if it has an ownership interest in one of the transacting parties and can significantly influence the other to an extent that one or more of the transacting parties might be prevented from fully pursuing its own separate interests is also a related party. Recent Accounting Pronouncements Management does not believe that any recently issued, but not effective, accounting standards, if currently adopted, would have a material effect on the Company's financial statements. |
ORBITAL TRACKING CORP AND GLOBA
ORBITAL TRACKING CORP AND GLOBAL TELESAT COMMUNICATIONS LIMITED SHARE EXCHANGE, REVERSE ACQUISITION AND RECAPITALIZATION | 6 Months Ended |
Jun. 30, 2016 | |
Business Combinations [Abstract] | |
Note 2 - TRACKING CORP AND GLOBAL TELESAT COMMUNICATIONS LIMITED SHARE EXCHANGE, REVERSE ACQUISITION AND RECAPITALIZATION | On February 19, 2015, the Company entered into a Share Exchange Agreement with Global Telesat Communications Limited, For accounting purposes, this transaction is being accounted for as a reverse acquisition and has been treated as a recapitalization of Orbital Tracking Corp. with Global Telesat Communications Limited considered the accounting acquirer, and the financial statements of the accounting acquirer became the financial statements of the registrant. The completion of the Share Exchange resulted in a change of control. The Share Exchange was accounted for as a reverse acquisition and re-capitalization. The GTCL Shareholders obtained approximately 39% of voting control on the date of Share Exchange. GTCL was the acquirer for financial reporting purposes and the Orbital Tracking Corp. was the acquired company. The consolidated financial statements after the acquisition include the balance sheets of both companies at historical cost, the historical results of GTCL and the results of the Company from the acquisition date. All share and per share information in the accompanying consolidated financial statements and footnotes has been retroactively restated to reflect the recapitalization. As part of agreement, OTC shareholders retained 5,383,172 shares of the Common Stock, 20,000 shares of series A Convertible Preferred Stock, 6,666 shares of series B Convertible Preferred Stock, 1,197,442 shares of series C Convertible Preferred Stock and 5,000,000 shares of series D Convertible Preferred Stock. Property and equipment $ 4,973 Accounts receivable 34,585 Cash in bank 30,934 Prepaid expenses 2,219,677 Inventory 40,161 Intangible asset 250,000 Current liabilities (469,643 ) Due to related party (2,174 ) Derivative liability (4,936 ) Liabilities of discontinued operations (112,397 ) Total purchase price/assets acquired $ 1,991,180 |
STOCKHOLDERS' EQUITY (DEFICIT)
STOCKHOLDERS' EQUITY (DEFICIT) | 6 Months Ended |
Jun. 30, 2016 | |
Equity [Abstract] | |
Note 3 - STOCKHOLDERS' (DEFICIT) | Preferred Stock As of June 30, 2016, there were 50,000,000 shares of Preferred Stock authorized. As of June 30, 2016, there were 20,000 shares of Series A Convertible Preferred Stock authorized and 0 shares issued and outstanding, due to the conversion of 20,000 shares of Series A into 20,000 shares of common stock. As of June 30, 2016, there were 30,000 shares of Series B Convertible Preferred Stock authorized and 6,667 shares issued and outstanding. As of June 30, 2016, there were 4,000,000 shares of Series C Convertible Preferred Stock authorized and 3,190,365 shares issued and outstanding, due to the conversion of 147,077 shares of Series C into 1,470,770 shares of common stock. As of June 30, 2016, there were 5,000,000 shares of Series D Convertible Preferred Stock authorized and 4,063,843 shares issued and outstanding, due to the conversion of 609,167 shares of Series D into 12,183,340 shares of common stock. As of June 30, 2016, there were 8,746,000 shares of Series E Convertible Preferred Stock authorized and 8,504,569 shares issued and outstanding, due to the conversion of 117,020 shares of Series E into 1,170,200 shares of common stock. As of June 30, 2016, there were 1,100,000 shares of Series F shares authorized and 1,099,998 shares issued and outstanding. As of June 30, 2016, there were 10,090,000 shares of Series G shares authorized and 10,083,351 shares issued and outstanding, upon the exchange of convertible notes in the amount of $504,168 into 10,083,351 shares of common stock. Common Stock As of June 30, 2016, there were 750,000,000 shares of Common Stock authorized and 34,213,004 shares issued and outstanding. On January 4, 2016, the Company issued an aggregate of 75,000 shares of common stock upon the conversion of 7,500 shares of Series E Preferred Stock. On January 29, 2016, the Company issued an aggregate of 850,000 shares of common stock upon the conversion of 42,500 shares of Series D Preferred Stock. On February 1, 2016, the Company issued an aggregate of 98,400 shares of common stock upon the conversion of 9,840 shares of Series E Preferred Stock. On February 2, 2016, the Company issued an aggregate of 900,000 shares of common stock upon the conversion of 45,000 shares of Series D Preferred Stock. On February 5, 2016, the Company issued an aggregate of 1,600 shares of common stock upon the conversion of 160 shares of Series E Preferred Stock. On February 11, 2016, the Company issued an aggregate of 136,612 shares of common stock calculated by the average closing price of the Companys common stock on its principal exchange for the 10 (ten) trading days immediately prior to the execution of the Agreement, or $100,000, to an investor relations consultant as compensation for services, which is amortized over the period of service. On February 16, 2016, the Company issued an aggregate of 100,000 shares of common stock upon the conversion of 10,000 shares of Series E Preferred Stock. On March 1, 2016, the Company issued an aggregate of 98,400 shares of common stock upon the conversion of 9,840 shares of Series E Preferred Stock. On March 8, 2016, the Company issued an aggregate of 73,320 shares of common stock upon the conversion of 3,666 shares of Series D Preferred Stock. On March 11, 2016, the Company issued an aggregate of 1,600 shares of common stock upon the conversion of 160 shares of Series E Preferred Stock. On April 1, 2016, the Company issued an aggregate of 98,400 shares of common stock upon the conversion of 9,840 shares of Series E Preferred Stock. On April 5, 2016, the Company issued an aggregate of 208,530 shares of common stock upon the conversion of 20,853 shares of Series C Preferred Stock. On April 12, 2016, the Company issued an aggregate of 125,000 shares of common stock upon the conversion of 6,250 shares of Series D Preferred Stock. On April 18, 2016, the Company issued an aggregate of 650,000 shares of common stock upon the conversion of 32,500 shares of Series D Preferred Stock. On April 21, 2016, the Company issued an aggregate of 400,000 shares of common stock upon the conversion of 20,000 shares of Series D Preferred Stock. On April 22, 2016, the Company issued an aggregate of 900,000 shares of common stock upon the conversion of 45,000 shares of Series D Preferred Stock. On April 27, 2016, the Company issued an aggregate of 200,000 shares of common stock upon the conversion of 10,000 shares of Series D Preferred Stock. On May 2, 2016, the Company issued an aggregate of 92,840 shares of common stock upon the conversion of 9,284 shares of Series E Preferred Stock. On May 4, 2016, the Company issued an aggregate of 5,560 shares of common stock upon the conversion of 556 shares of Series E Preferred Stock. On May 17, 2016, the Company issued an aggregate of 1,376,470 shares of common stock upon the conversion of 64,147 shares of Series C Preferred Stock and 36,750 shares of Series D Preferred Stock. On May 17, 2016, the Company issued an aggregate of 2,420,770 shares of common stock upon the conversion of 62,077 shares of Series C Preferred Stock and 90,000 shares of Series D Preferred Stock. Also, on May 17, 2016 the Company issued an aggregate of 10,083,351 shares of Series G Preferred Stock upon the exchange of convertible notes of $504,168. Upon the conversion, additional paid in capital increased $649,662 from the decrease in convertible notes payable of $504,168, decrease in derivative liabilities of $146,502 and increase in Preferred Stock Series G of $1,008. On May 20, 2016, the Company issued an aggregate of 760,000 shares of common stock upon the conversion of 38,000 shares of Series D Preferred Stock. On May 23, 2016, the Company issued an aggregate of 250,000 shares of common stock upon the conversion of 12,500 shares of Series D Preferred Stock. On May 25, 2016, the Company issued an aggregate of 950,000 shares of common stock upon the conversion of 47,500 shares of Series D Preferred Stock. On June 1, 2016, the Company issued an aggregate of 98,400 shares of common stock upon the conversion of 9,840 shares of Series E Preferred Stock. On June 6, 2016, the Company issued an aggregate of 1,531,020 shares of common stock upon the conversion of 76,551 shares of Series D Preferred Stock. On June 8, 2016, the Company issued an aggregate of 1,000,000 shares of common stock upon the conversion of 50,000 shares of Series D Preferred Stock. On June 13, 2016, the Company issued an aggregate of 500,000 shares of common stock upon the conversion of 25,000 shares of Series D Preferred Stock. On June 30, 2016, the Company issued an aggregate of 500,000 shares of common stock upon the conversion of 50,000 shares of Series E Preferred Stock. Stock Options 2014 Equity Incentive Plan On January 21, 2014, the Board approved the adoption of a 2014 Equity Incentive Plan (the 2014 Plan). The purpose of the 2014 Plan is to promote the success of the Company and to increase stockholder value by providing an additional means through the grant of awards to attract, motivate, retain and reward selected employees and other eligible persons. The 2014 Plan provides for the grant of incentive stock options, nonqualified stock options, restricted stock, restricted stock units, stock appreciation rights and other types of stock-based awards to the Companys employees, officers, directors and consultants. Pursuant to the terms of the 2014 Plan, either the Board or a board committee is authorized to administer the plan, including by determining which eligible participants will receive awards, the number of shares of common stock subject to the awards and the terms and conditions of such awards. Unless earlier terminated by the Board, the Plan shall terminate at the close of business on January 21, 2024. Up to 226,667 shares of common stock are issuable pursuant to awards under the 2014 Plan, as adjusted in a single adjustment for an issuance no later than sixty (60) days following the date of shareholder approval of the Plan in connection with (i) a private placement of the Companys securities in which the Corporation receives gross proceeds of at least $1,000,000 and (ii) an acquisition of at least 50 mining leases and/or claims in the Holbrook Basin. On February 19, 2015, the Company issued to Mr. Rector, the former Chief Executive Officer, Chief Financial Officer and director of the Company, a seven-year option to purchase 2,150,000 shares of common stock as compensation for services provided to the Company. The options have an exercise price of $0.05 per share, were fully vested on the date of grant and shall expire in February 2022. The 2,150,000 options were valued on the grant date at approximately $0.05 per option or a total of $107,500 using a Black-Scholes option pricing model with the following assumptions: stock price of $0.05 per share (based on the sale of common stock in a private placement), volatility of 380%, expected term of 7 years, and a risk free interest rate of 1.58%. In connection with the stock option grant, the Company recorded stock based compensation for the for the year ended December 31, 2015 of $107,500. On December 28, 2015, the Company issued Ms. Carlise, Chief Financial Officer, a ten-year option to purchase 500,000 shares of common stock as compensation for services provided to the Company. The options have an exercise price of $0.05 per share, were fully vested on the date of grant and shall expire in December 2025. The 500,000 options were valued on the grant date at approximately $1.30 per option or a total of $650,000 using a Black-Scholes option pricing model with the following assumptions: stock price of $1.30 per share (based on the closing price of the Companys common stock of the date of issuance), volatility of 992%, expected term of 10 years, and a risk free interest rate of 1.05%. In connection with the stock option grant, the Company recorded stock based compensation for the six months ended June 30, 2016 and for the year ended December 31, 2015 of $0 and $650,000, respectively. Also on December 28, 2015, the Company issued Mr. Delgado, its Director, a ten-year option to purchase 200,000 shares of common stock as compensation for services provided to the Company. The options have an exercise price of $0.05 per share, were fully vested on the date of grant and shall expire in December 2025. The 200,000 options were valued on the grant date at approximately $1.30 per option or a total of $260,000 using a Black-Scholes option pricing model with the following assumptions: stock price of $1.30 per share (based on the closing price of the Companys common stock of the date of issuance), volatility of 992%, expected term of 10 years, and a risk free interest rate of 1.05%. In connection with the stock option grant, the Company recorded stock based compensation for the six months ended June 30, 2016 and for the year ended December 31, 2015 of $0 and $260,000, respectively. Stock options outstanding at June 30, 2016 as disclosed in the table below have approximately $57,000 of intrinsic value at the end of the period. A summary of the status of the Companys outstanding stock options and changes during the six months ended June 30, 2016 is as follows: Number of Options Weighted Average Exercise Price Weighted Average Remaining Contractual Life (Years) Balance at January 1, 2016 2,850,000 $ 0.05 7.08 Granted Exercised Forfeited Cancelled Balance outstanding and exercisable at June 30, 2016 2,850,000 $ 0.05 6.59 Weighted average fair value of options granted during the period $ 0.05 Stock Warrants A summary of the status of the Companys outstanding stock warrants and changes during the six months ended June 30, 2016 is as follows: Number of Warrants Weighted Average Exercise Price Weighted Average Remaining Contractual Life (Years) Balance at January 1, 2016 5,000 $ 4.50 1.36 Granted Exercised Forfeited Cancelled Balance outstanding at June 30, 2016 5,000 $ 4.50 1.11 The following table summarizes the Companys stock warrants outstanding at June 30, 2016: Warrants Outstanding Warrants Exercisable Exercise Price Number Outstanding at June 30, 2016 Weighted Average Remaining Contractual Life Weighted Average Exercise Price Number Exercisable at June 30, 2016 Weighted Average Exercise Price 4.50 5,000 0.86 Years 4.50 5,000 4.50 $ 4.50 5,000 0.86 Years $ 4.50 5,000 $ 4.50 |
PREPAID EXPENSES
PREPAID EXPENSES | 6 Months Ended |
Jun. 30, 2016 | |
Deferred Costs, Capitalized, Prepaid, and Other Assets Disclosure [Abstract] | |
Note 4 - PREPAID EXPENSES | Prepaid expenses amounted to $318,274 at June 30, 2016. Prepaid expenses include prepayments in cash for professional fees, prepayments in equity instruments which are being amortized over the terms of their respective agreements. Amortization of the prepaid expense will be included in professional fees. The current portion consists primarily of costs paid for future services which will occur within a year. Prepaid expense current portion and long-term portion were $238,137 and $80,137, as of June 30, 2016. As of December 31, 2015, prepaid expense current portion and long-term portion were $191,677 and $189,968, respectively. |
INTANGIBLE ASSETS
INTANGIBLE ASSETS | 6 Months Ended |
Jun. 30, 2016 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Note 5 - INTANGIBLE ASSETS | On February 19, 2015, the Company purchased an intangible asset valued at $250,000 for 1,000,000 shares of common stock. Amortization of customer contracts will be included in general and administrative expenses. The Company began amortizing the customer contracts in January 2015. Amortization expense for the three and six months ended June 30, 2016 was $6,250 and $12,500, respectively. Future amortization of intangible assets is as follows: 2016 12,500 2017 25,000 2018 25,000 2019 25,000 2020 and thereafter 125,000 Total $ 212,500 |
PROPERTY AND EQUIPMENT
PROPERTY AND EQUIPMENT | 6 Months Ended |
Jun. 30, 2016 | |
Property, Plant and Equipment [Abstract] | |
Note 6 - PROPERTY AND EQUIPMENT | Property and equipment consisted of the following: June 30, December 31, 2016 2015 Office furniture and fixtures $ 113,681 $ 95,434 Computer equipment 24,302 24,766 Appliques 2,160,096 2,160,096 Website development 105,271 92,399 Less accumulated depreciation (287,658 ) (154,002 ) Total $ 2,115,692 $ 2,218,693 Depreciation expense was $133,656 for the six months ended June 30, 2016. For the six months ended June 30, 2015 depreciation expense was $29,515. |
INVENTORIES
INVENTORIES | 6 Months Ended |
Jun. 30, 2016 | |
Inventory Disclosure [Abstract] | |
Note 7 - INVENTORIES | At June 30, 2016 and December 31, 2015, inventories consisted of the following: June 30, December 31, 2016 2015 Finished goods $ 289,522 $ 251,518 Less reserve for obsolete inventory - - Total $ 289,522 $ 251,518 For the six months ended June 30, 2016 and the year ended December 31, 2015, the Company did not make any change to reserve for obsolete inventory. |
RELATED PARTY TRANSACTIONS
RELATED PARTY TRANSACTIONS | 6 Months Ended |
Jun. 30, 2016 | |
Related Party Transactions [Abstract] | |
Note 8 - RELATED PARTY TRANSACTIONS | The Company has received financing from the Companys Chief Executive Officer. No formal repayment terms or arrangements existed prior to February 19, 2015, when as part of the Share Exchange Agreement, the Company entered into a note with David Phipps where the stockholder loans bear no interest and are due February 19, 2017. The accounts payable due to related party includes advances for inventory due to David Phipps and compensation. Total payments due to David Phipps as of June 30, 2016 and December 31, 2015 are $85,622 and $74,051, respectively. Also, as part of the Share Exchange Agreement entered into on February 19, 2015, Mr. Phipps received a payment of $25,000 as compensation for transition services that he provided. The Company employs two individuals who are related to Mr. Phipps, of which earned gross wages totaling $25,210 for the six months ended June 30, 2016. |
COMMITMENTS AND CONTINGENCIES
COMMITMENTS AND CONTINGENCIES | 6 Months Ended |
Jun. 30, 2016 | |
Commitments and Contingencies Disclosure [Abstract] | |
Note 9 - COMMITMENTS AND CONTINGENCIES | Employment Agreements On February 19, 2015, Orbital Satcom entered into an employment agreement with Mr. Phipps, whereby Mr. Phipps agreed to serve as the President of Orbital Satcom for a period of two years, subject to renewal, in consideration for an annual salary of $180,000. Additionally, under the terms of the employment agreement, Mr. Phipps shall be eligible for an annual bonus if the Company meets certain criteria, as established by the Board of Directors. Mr. Phipps remains the sole director of GTCL following the closing of the Share Exchange. Mr. Phipps and the Company entered into an Indemnification Agreement at the closing. The Company entered into an employment agreement with Ms. Carlise on June 9, 2015. The agreement has a term of one year, and shall automatically be extended for additional terms of one year each. The agreement provides for an annual base salary of $72,000. In addition to the base salary Ms. Carlise shall be eligible to receive an annual cash bonus if the Company meets or exceeds criteria adopted by the Compensation Committee of the Board of Directors and shall be eligible for grants of awards under stock option or other equity incentive plans of the Company. On December 28, 2015, the Company amended her employment agreement. Effective December 1, 2015, the term of Ms. Carlises employment was extended to December 1, 2016 from June 9, 2016, her annual salary was increased to $140,000 from $72,000 and she agreed to devote her full business time to the Company. The term of the Original Agreement, as amended by the Amendment, shall automatically extend for additional terms of one year each, unless either party gives prior written notice of non-renewal to the other party no later than 60 days prior to the expiration of the initial term or the then current renewal term, as applicable. On February 26, 2016, the Board of Directors of Orbital Tracking Corp., a Nevada corporation (Orbital or the Company), entered into a new executive employment agreement, (Employment Agreement) with its Chief Executive Officer and President, David Phipps and terminated the original employment agreement dated February 19, 2015, at a base salary of $144,000 and £ 48,000 per annum, to be effective as of January 20, 2016, for a term of two years from effective date. In addition to the base salary Executive shall be entitled Litigation From time to time, the Company may become involved in litigation relating to claims arising out of our operations in the normal course of business. The Company is not currently involved in any pending legal proceeding or litigation and, to the best of our knowledge, no governmental authority is contemplating any proceeding to which the Company is a party or to which any of the Companys properties is subject, which would reasonably be likely to have a material adverse effect on the Companys business, financial condition and operating results. |
DERIVATIVE LIABILITIES
DERIVATIVE LIABILITIES | 6 Months Ended |
Jun. 30, 2016 | |
Notes to Financial Statements | |
Note 10 - DERIVATIVE LIABILITIES | In June 2008, a FASB approved guidance related to the determination of whether a freestanding equity-linked instrument should be classified as equity or debt under the provisions of FASB ASC Topic No. 815-40, Derivatives and Hedging Contracts in an Entitys Own Stock. The adoption of this requirement will affect accounting for convertible instruments and warrants with provisions that protect holders from declines in the stock price (down-round provisions). Warrants with such provisions are no longer recorded in equity and are reclassified as a liability. Instruments with down-round protection are not considered indexed to a companys own stock under ASC Topic 815, because neither the occurrence of a sale of common stock by the company at market nor the issuance of another equity-linked instrument with a lower strike price is an input to the fair value of a fixed-for-fixed option on equity shares. In connection with the issuance of its 6% convertible debentures and related warrants, the Company has determined that the terms of the convertible warrants include down-round provisions under which the exercise price could be affected by future equity offerings. Accordingly, the warrants are accounted for as liabilities at the date of issuance and adjusted to fair value through earnings at each reporting date. On May 17, 2016, the Company entered into exchange agreements with holders of the Company's outstanding $504,168 convertible notes originally issued on December 28, 2015 pursuant to which the Notes were cancelled and the exchanging holders were issued an aggregate of 10,083,351 shares of newly designated Series G Convertible Preferred. Upon the conversion, additional paid in capital increased $649,662 from the decrease in convertible notes payable of $504,168, decrease in derivative liabilities of $146,502 and increase in Preferred Stock Series G of $1,008. The convertible notes were accounted for as liabilities at the date of issuance and adjusted to fair value through earnings at each reporting date. The Company recorded amortization for the discount to the convertible notes of $602,515 at June 30, 2016. As of June 30, 2016 and December 31, 2015, the Company has unamortized discount balance of $0 and $602,515, respectively. The Company has recognized derivative liabilities of $0 and $614,036 at June 30, 2016 and December 31, 2015, respectively. The gain (loss) resulting from the decrease (increase) in fair value of this convertible instrument was $422,974 and ($64,035) for the six months ended June 30, 2016 and the year ended December 31, 2015, respectively. The Company has recognized derivative liabilities for related warrants of $2,484 and $4,355 at June 30, 2016 and December 31, 2015, respectively. The gain resulting from the decrease in fair value of this convertible instrument was $1,872 and $580 for the six months ended June 30, 2016 and the year ended December 31, 2015, respectively. Weighted average term is 1.11 years. The Company used the following assumptions for determining the fair value of the convertible instruments granted under the Black-Scholes option pricing model: June 30, 2016 Expected volatility 238 % Expected term - years 0.86 Risk-free interest rate 0.58 % Expected dividend yield 0 % |
CONCENTRATIONS
CONCENTRATIONS | 6 Months Ended |
Jun. 30, 2016 | |
Risks and Uncertainties [Abstract] | |
Note 11 - CONCENTRATIONS | Customers: No customer accounted for 10% or more of the Companys revenues during the six months ended June 30, 2016 and 2015. Suppliers: The following table sets forth information as to each supplier that accounted for 10% or more of the Companys purchases for the six months ended June 30, 2016 and 2015. June 30, 2016 June 30, 2015 Globalstar Europe $ 146,547 10.9 % $ - Network Innovations $ 424,605 31.5 % $ 207,479 15.9 % |
SUBSEQUENT EVENTS
SUBSEQUENT EVENTS | 6 Months Ended |
Jun. 30, 2016 | |
Subsequent Events [Abstract] | |
Note 12 - SUBSEQUENT EVENTS | On July 5, 2016, the Company issued an aggregate of 1,058,400 shares of common stock upon the conversion of 48,000 shares of Series D Preferred Stock and 9,840 shares of Series E Preferred Stock. On July 12, 2016, the Company issued an aggregate of 750,000 shares of common stock upon the conversion of 37,500 shares of Series D Preferred Stock. On August 1, 2016, the Company issued an aggregate of 123,010 shares of common stock upon the conversion of 12,301 shares of Series E Preferred Stock. |
BASIS OF PRESENTATION AND SUM18
BASIS OF PRESENTATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Policies) | 6 Months Ended |
Jun. 30, 2016 | |
Accounting Policies [Abstract] | |
Basis of Presentation and Principles of Consolidation | The unaudited condensed consolidated financial statements are prepared in accordance with generally accepted accounting principles in the United States of America ("US GAAP") and the rules and regulations of the U.S Securities and Exchange Commission for Interim Financial Information. All intercompany transactions and balances have been eliminated. All adjustments (consisting of normal recurring items) necessary to present fairly the Company's financial position as of June 30, 2016, and the results of operations and cash flows for the six months ended June 30, 2016 have been included. The results of operations for the three and six months ended June 30, 2016 are not necessarily indicative of the results to be expected for the full year. |
Description of Business | Orbital Tracking Corp. (the Company) was formerly Great West Resources, Inc., a Nevada corporation. The Company, through its wholly owned subsidiaries, Global Telesat Communications Limited (GTCL) and Orbital Satcom Corp. (Orbital Satcom) is a provider of satellite based hardware, airtime and related services both in the United States and internationally. The Companys principal focus is on growing the Companys existing satellite based hardware, airtime and related services business line and developing the Companys own tracking devices for use by retail customers worldwide. |
Use of Estimates | In preparing the consolidated financial statements, management is required to make estimates and assumptions that affect the reported amounts of assets and liabilities as of the date of the statements of financial condition, and revenues and expenses for the years then ended. Actual results may differ significantly from those estimates. Significant estimates made by management include, but are not limited to, the assumptions used to calculate stock-based compensation, derivative liabilities, preferred deemed dividend and common stock issued for services. |
Going Concern Considerations | The accompanying The condensed |
Cash and Cash Equivalents | The Company considers all highly liquid investments with a maturity of six months or less when acquired to be cash equivalents. The Company places its cash with a high credit quality financial institution. The Companys account at this institution is insured by the Federal Deposit Insurance Corporation (FDIC) up to $250,000. To reduce its risk associated with the failure of such financial institution, the Company evaluates at least annually the rating of the financial institution in which it holds deposits. |
Accounts receivable and allowance for doubtful accounts | The Company has a policy of reserving for questionable accounts based on its best estimate of the amount of probable credit losses in its existing accounts receivable. The Company periodically reviews its accounts receivable to determine whether an allowance is necessary based on an analysis of past due accounts and other factors that may indicate that the realization of an account may be in doubt. Account balances deemed to be uncollectible are charged to the bad debt expense after all means of collection have been exhausted and the potential for recovery is considered remote. As of June 30, 2016 and December 31, 2015, there is an allowance for doubtful accounts of $0 and $0. |
Foreign Currency Translation | The Companys reporting currency is US Dollars. The accounts of one of the Companys subsidiaries is maintained using the appropriate local currency, (Great British Pound) GTCL as the functional currency. All assets and liabilities are translated into U.S. Dollars at balance sheet date, shareholders' equity is translated at historical rates and revenue and expense accounts are translated at the average exchange rate for the year or the reporting period. The translation adjustments are deferred as a separate component of stockholders equity, captioned as accumulated other comprehensive (loss) gain. Transaction gains and losses arising from exchange rate fluctuation on transactions denominated in a currency other than the functional currency are included in the statements of operations. The |
Revenue Recognition and Unearned Revenue | The Company recognizes revenue from satellite services when earned, as services are rendered or delivered to customers. Equipment sales revenue is recognized when the equipment is delivered to and accepted by the customer. Only equipment sales are subject to warranty. Historically, the Company has not incurred significant expenses for warranties. The Companys customers generally purchase a combination of our products and services as part of a multiple element arrangement. The Companys assessment of which revenue recognition guidance is appropriate to account for each element in an arrangement can involve significant judgment. This assessment has a significant impact on the amount and timing of revenue recognition. Revenue is recognized when all of the following criteria have been met: ● Persuasive evidence of an arrangement exists. Contracts and customer purchase orders are generally used to determine the existence of an arrangement. ● Delivery has occurred. Shipping documents and customer acceptance, when applicable, are used to verify delivery. ● The fee is fixed or determinable. We assess whether the fee is fixed or determinable based on the payment terms associated with the transaction and whether the sales price is subject to refund or adjustment. ● Collectability is reasonably assured. We assess collectability based primarily on the creditworthiness of the customer as determined by credit checks and analysis, as well as the customers payment history. In accordance with ASC 605-25, Revenue Recognition Multiple-Element Arrangements, |
Goodwill and other intangible assets | In accordance with ASC 350-30-65, Intangibles - Goodwill and Others, the Company assesses the impairment of identifiable intangibles whenever events or changes in circumstances indicate that the carrying value may not be recoverable. Factors the Company considers to be important which could trigger an impairment review include the following: 1. Significant underperformance relative to expected historical or projected future operating results; 2. Significant changes in the manner of use of the acquired assets or the strategy for the overall business; and 3. Significant negative industry or economic trends. When the Company determines that the carrying value of intangibles may not be recoverable based upon the existence of one or more of the above indicators of impairment and the carrying value of the asset cannot be recovered from projected undiscounted cash flows, the Company records an impairment charge. The Company measures any impairment based on a projected discounted cash flow method using a discount rate determined by management to be commensurate with the risk inherent in the current business model. Significant management judgment is required in determining whether an indicator of impairment exists and in projecting cash flows. |
Property and Equipment | Property and equipment are carried at historical cost less accumulated depreciation. Depreciation is based on the estimated service lives of the depreciable assets and is calculated using the straight-line method. Expenditures that increase the value or productive capacity of assets are capitalized. Fully depreciated assets are retained in the property and equipment, and accumulated depreciation accounts until they are removed from service. When property and equipment are retired, sold or otherwise disposed of, the assets carrying amount and related accumulated depreciation are removed from the accounts and any gain or loss is included in operations. Repairs and maintenance are expensed as incurred. The estimated useful lives of property and equipment are generally as follows: Years Office furniture and fixtures 4 Computer equipment 4 Appliques 10 Website development 2 |
Impairment of long-lived assets | The Company reviews long-lived assets for impairment whenever events or changes in circumstances indicate that the carrying amount of the assets may not be fully recoverable, or at least annually. The Company recognizes an impairment loss when the sum of expected undiscounted future cash flows is less than the carrying amount of the asset. The amount of impairment is measured as the difference between the assets estimated fair value and its book value. The Company did not consider it necessary to record any impairment charges during the periods ended June 30, 2016 and December 31, 2015, respectively. |
Fair value of financial instruments | The Company adopted Financial Accounting Standards Board (FASB) Accounting Standards Codification (ASC) 820, Fair Value Measurements and Disclosures, for assets and liabilities measured at fair value on a recurring basis. ASC 820 establishes a common definition for fair value to be applied to existing US GAAP that require the use of fair value measurements which establishes a framework for measuring fair value and expands disclosure about such fair value measurements. ASC 820 defines fair value as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. Additionally, ASC 820 requires the use of valuation techniques that maximize the use of observable inputs and minimize the use of unobservable inputs. These inputs are prioritized below: Level 1: Observable inputs such as quoted market prices in active markets for identical assets or liabilities Level 2: Observable market-based inputs or unobservable inputs that are corroborated by market data Level 3: Unobservable inputs for which there is little or no market data, which require the use of the reporting entitys own assumptions. The following table presents a reconciliation of the derivative liability measured at fair value on a recurring basis using significant unobservable input (Level 3) from January 1, 2016 to June 30, 2016: Conversion Feature Derivative Liability Warrant Liability Total Balance at January 1, 2016 $ 614,036 $ 4,355 $ 618,391 Change in fair value included in earnings (422,974) (1,871) (424,846) Net effect on additional paid in capital (191,062) - (191,062) Balance June 30, 2016 $ - $ 2,484 $ 2,484 The Company did not identify any other assets or liabilities that are required to be presented on the consolidated balance sheets at fair value in accordance with the accounting guidance. The carrying amounts reported in the balance sheet for cash, accounts payable, and accrued expenses approximate their estimated fair market value based on the short-term maturity of the instruments. |
Stock Based Compensation | Stock-based compensation is accounted for based on the requirements of the Share-Based Payment Topic of ASC 718 which requires recognition in the consolidated financial statements of the cost of employee and director services received in exchange for an award of equity instruments over the period the employee or director is required to perform the services in exchange for the award (presumptively, the vesting period). The ASC also requires measurement of the cost of employee and director services received in exchange for an award based on the grant-date fair value of the award. Pursuant to ASC Topic 505-50, for share-based payments to consultants and other third-parties, compensation expense is determined at the measurement date. The expense is recognized over the vesting period of the award. Until the measurement date is reached, the total amount of compensation expense remains uncertain. The Company initially records compensation expense based on the fair value of the award at the reporting date. |
Income Taxes | The Company has adopted Accounting Standards Codification subtopic 740-10, Income Taxes U.S. GAAP requires that, in applying the liability method, the financial statement effects of an uncertain tax position be recognized based on the outcome that is more likely than not to occur. Under this criterion the most likely resolution of an uncertain tax position should be analyzed based on technical merits and on the outcome that will likely be sustained under examination. There were no adjustments related to uncertain tax positions recognized during the six months ended June 30, 2016 and the year ended December 31, 2015, respectively. |
Earnings per Common Share | Net income (loss) per common share is calculated in accordance with ASC Topic 260: Earnings per Share (ASC 260). Basic income (loss) per share is computed by dividing net income (loss) by the weighted average number of shares of common stock outstanding during the period. The computation of diluted net loss per share does not include dilutive common stock equivalents in the weighted average shares outstanding as they would be anti-dilutive. For the six months ended June 30, 2016, where the Company had net income, therefore weighted average number of shares dilutive are noted. For the six months ended June 30, 2015, periods where the Company has a net loss, all dilutive securities are excluded. The following are dilutive common stock equivalents during the period ended: June 30, June 30, 2016 2015 Convertible preferred stock 209,416,215 220,887,750 Stock options 2,850,000 2,150,000 Stock warrants 5,000 5,000 Total 212,271,215 223,042,750 |
Related party transactions | A party is considered to be related to the Company if the party directly or indirectly or through one or more intermediaries, controls, is controlled by, or is under common control with the Company. Related parties also include principal owners of the Company, its management, members of the immediate families of principal owners of the Company and its management and other parties with which the Company may deal if one party controls or can significantly influence the management or operating policies of the other to an extent that one of the transacting parties might be prevented from fully pursuing its own separate interests. A party which can significantly influence the management or operating policies of the transacting parties or if it has an ownership interest in one of the transacting parties and can significantly influence the other to an extent that one or more of the transacting parties might be prevented from fully pursuing its own separate interests is also a related party. |
Recent Accounting Pronouncements | Management does not believe that any recently issued, but not effective, accounting standards, if currently adopted, would have a material effect on the Company's financial statements. |
BASIS OF PRESENTATION AND SUM19
BASIS OF PRESENTATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Tables) | 6 Months Ended |
Jun. 30, 2016 | |
Accounting Policies [Abstract] | |
Estimated useful life of property and equipment | Years Office furniture and fixtures 4 Computer equipment 4 Appliques 10 Website development 2 |
Reconciliation of the derivative liability measured at fair value | Conversion Feature Derivative Liability Warrant Liability Total Balance at January 1, 2016 $ 614,036 $ 4,355 $ 618,391 Change in fair value included in earnings (422,974) (1,871) (424,846) Net effect on additional paid in capital (191,062) - (191,062) Balance June 30, 2016 $ - $ 2,484 $ 2,484 |
Dilutive securities | June 30, June 30, 2016 2015 Convertible preferred stock 209,416,215 220,887,750 Stock options 2,850,000 2,150,000 Stock warrants 5,000 5,000 Total 212,271,215 223,042,750 |
ORBITAL TRACKING CORP AND GLO20
ORBITAL TRACKING CORP AND GLOBAL TELESAT COMMUNICATIONS LIMITED SHARE EXCHANGE, REVERSE ACQ AND RECAPITALIZATION (Tables) | 6 Months Ended |
Jun. 30, 2016 | |
Business Combinations [Abstract] | |
Acquisition | Property and equipment $ 4,973 Accounts receivable 34,585 Cash in bank 30,934 Prepaid expenses 2,219,677 Inventory 40,161 Intangible asset 250,000 Current liabilities (469,643 ) Due to related party (2,174 ) Derivative liability (4,936 ) Liabilities of discontinued operations (112,397 ) Total purchase price/assets acquired $ 1,991,180 |
STOCKHOLDERS' EQUITY (DEFICIT)
STOCKHOLDERS' EQUITY (DEFICIT) (Tables) | 6 Months Ended |
Jun. 30, 2016 | |
Equity [Abstract] | |
Outstanding stock options | Number of Options Weighted Average Exercise Price Weighted Average Remaining Contractual Life (Years) Balance at January 1, 2016 2,850,000 $ 0.05 7.08 Granted Exercised Forfeited Cancelled Balance outstanding and exercisable at June 30, 2016 2,850,000 $ 0.05 6.59 Weighted average fair value of options granted during the period $ 0.05 |
Stock warrants outstanding | Number of Warrants Weighted Average Exercise Price Weighted Average Remaining Contractual Life (Years) Balance at January 1, 2016 5,000 $ 4.50 1.36 Granted Exercised Forfeited Cancelled Balance outstanding at June 30, 2016 5,000 $ 4.50 1.11 |
Warrants outstanding by exercise price | Warrants Outstanding Warrants Exercisable Exercise Price Number Outstanding at June 30, 2016 Weighted Average Remaining Contractual Life Weighted Average Exercise Price Number Exercisable at June 30, 2016 Weighted Average Exercise Price 4.50 5,000 0.86 Years 4.50 5,000 4.50 $ 4.50 5,000 0.86 Years $ 4.50 5,000 $ 4.50 |
INTANGIBLE ASSETS (Tables)
INTANGIBLE ASSETS (Tables) | 6 Months Ended |
Jun. 30, 2016 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Future amortization of intangible assets | 2016 12,500 2017 25,000 2018 25,000 2019 25,000 2020 and thereafter 125,000 Total $ 212,500 |
PROPERTY AND EQUIPMENT (Tables)
PROPERTY AND EQUIPMENT (Tables) | 6 Months Ended |
Jun. 30, 2016 | |
Property, Plant and Equipment [Abstract] | |
Property and equipment | June 30, December 31, 2016 2015 Office furniture and fixtures $ 113,681 $ 95,434 Computer equipment 24,302 24,766 Appliques 2,160,096 2,160,096 Website development 105,271 92,399 Less accumulated depreciation (287,658 ) (154,002 ) Total $ 2,115,692 $ 2,218,693 |
INVENTORIES (Tables)
INVENTORIES (Tables) | 6 Months Ended |
Jun. 30, 2016 | |
Inventory Disclosure [Abstract] | |
Inventories | June 30, December 31, 2016 2015 Finished goods $ 289,522 $ 251,518 Less reserve for obsolete inventory - - Total $ 289,522 $ 251,518 |
DERIVATIVE LIABILITIES (Tables)
DERIVATIVE LIABILITIES (Tables) | 6 Months Ended |
Jun. 30, 2016 | |
Notes to Financial Statements | |
Assumptions for fair value of convertible instruments granted under Black-Scholes option pricing model | June 30, 2016 Expected volatility 238 % Expected term - years 0.86 Risk-free interest rate 0.58 % Expected dividend yield 0 % |
CONCENTRATIONS (Tables)
CONCENTRATIONS (Tables) | 6 Months Ended |
Jun. 30, 2016 | |
Risks and Uncertainties [Abstract] | |
Concentration risk | June 30, 2016 June 30, 2015 Globalstar Europe $ 146,547 10.9 % $ - Network Innovations $ 424,605 31.5 % $ 207,479 15.9 % |
BASIS OF PRESENTATION AND SUM27
BASIS OF PRESENTATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Details) | 6 Months Ended |
Jun. 30, 2016 | |
Computer Equipment [Member] | |
Estimated useful life | 4 years |
Website Development [Member] | |
Estimated useful life | 2 years |
Appliques [Member] | |
Estimated useful life | 10 years |
Office Furniture and Fixtures [Member] | |
Estimated useful life | 4 years |
BASIS OF PRESENTATION AND SUM28
BASIS OF PRESENTATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Details 1) - USD ($) | 6 Months Ended | 12 Months Ended |
Jun. 30, 2016 | Dec. 31, 2015 | |
Balance at Beginning of Period | $ 618,391 | |
Change in fair value included in earnings | 1,872 | $ 580 |
Net effect on additional paid in capital | (191,062) | |
Balance at End of Period | 2,484 | 618,391 |
Conversion Feature Derivative Liability | ||
Balance at Beginning of Period | 614,036 | |
Change in fair value included in earnings | (422,974) | |
Net effect on additional paid in capital | (191,062) | |
Balance at End of Period | 0 | 614,036 |
Warrant Liability | ||
Balance at Beginning of Period | 4,355 | |
Change in fair value included in earnings | (1,871) | |
Net effect on additional paid in capital | 0 | |
Balance at End of Period | $ 2,484 | $ 4,355 |
BASIS OF PRESENTATION AND SUM29
BASIS OF PRESENTATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Details 2) - shares | 6 Months Ended | |
Jun. 30, 2016 | Jun. 30, 2015 | |
Dilutive common stock equivalents | 212,271,215 | 223,042,750 |
Convertible notes payable [Member] | ||
Dilutive common stock equivalents | ||
Convertible Preferred Stock [Member] | ||
Dilutive common stock equivalents | 209,416,215 | 220,887,750 |
Stock Option [Member] | ||
Dilutive common stock equivalents | 2,850,000 | 2,150,000 |
Stock Warrant [Member] | ||
Dilutive common stock equivalents | 5,000 | 5,000 |
BASIS OF PRESENTATION AND SUM30
BASIS OF PRESENTATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Details Narrative) | Jun. 30, 2016USD ($) | Dec. 31, 2015USD ($) | Jun. 30, 2015 |
Basis Of Presentation And Summary Of Significant Accounting Policies Details Narrative | |||
Insurance by the FDIC, maximum | $ 250,000 | ||
Allowance for doubtful accounts | $ 0 | $ 0 | |
Foreign current translation rates | 1.3311 | 1.5236 | 1.5725 |
ORBITAL TRACKING CORP AND GLO31
ORBITAL TRACKING CORP AND GLOBAL TELESAT COMMUNICATIONS LIMITED SHARE EXCHANGE, REVERSE ACQ AND RECAP (Details) | Jun. 30, 2016USD ($) |
Business Combinations [Abstract] | |
Property and equipment | $ 4,973 |
Accounts receivable | 34,585 |
Cash in bank | 30,934 |
Prepaid expenses | 2,219,677 |
Inventory | 40,161 |
Intangible asset | 250,000 |
Current liabilities | (469,643) |
Due to related party | (2,174) |
Derivative liability | (4,936) |
Liabilities of discontinued operations | (112,397) |
Total purchase price/assets acquired | $ 1,991,180 |
STOCKHOLDERS' EQUITY (DEFICIT32
STOCKHOLDERS' EQUITY (DEFICIT) (Details) | 6 Months Ended |
Jun. 30, 2016$ / sharesshares | |
Option activity | |
Balance at beginning of period | shares | 2,850,000 |
Granted | shares | 0 |
Exercised | shares | 0 |
Forfeited | shares | 0 |
Cancelled | shares | 0 |
Options, Outstanding, Number | shares | 2,850,000 |
Options, Exercisable, Number | shares | 2,850,000 |
Stock option/warrant outstanding, Weighted Average Exercise Price, Beginning Balance | $ .05 |
Recapitalization at February 19, 2015 | 0 |
Stock option/warrant outstanding, Weighted Average Exercise Price, Granted | 0 |
Stock option/warrant outstanding, Weighted Average Exercise Price, Exercised | 0 |
Stock option/warrant outstanding, Weighted Average Exercise Price, Forfeited | 0 |
Stock option/warrant outstanding, Weighted Average Exercise Price, Cancelled | 0 |
Stock option/warrant outstanding, Weighted Average Exercise Price, Ending Balance | .05 |
Stock option/warrant outstanding, Weighted Average Exercise Price, Exercisable, Ending Balance | .05 |
Weighted average fair value of options granted during the period | $ .05 |
Weighted Average Remaining Contractual Life (Years), Granted options | 6 years 7 months 2 days |
Weighted Average Remaining Contractual Life (Years), outstanding | 6 years 7 months 2 days |
STOCKHOLDERS' EQUITY (DEFICIT33
STOCKHOLDERS' EQUITY (DEFICIT) (Details 1) | 6 Months Ended |
Jun. 30, 2016$ / sharesshares | |
Warrants | |
Balance at beginning of period | shares | 5,000 |
Granted | shares | 0 |
Exercised | shares | 0 |
Forfeited | shares | 0 |
Cancelled | shares | 0 |
Options, Outstanding, Number | shares | 5,000 |
Stock option/warrant outstanding, Weighted Average Exercise Price, Beginning Balance | $ / shares | $ 4.50 |
Weighted Average Exercise Price, Granted | $ / shares | 0 |
Weighted Average Exercise Price, Exercised | $ / shares | 0 |
Weighted Average Exercise Price, Forfeited | $ / shares | 0 |
Weighted Average Exercise Price, Cancelled | $ / shares | 0 |
Weighted average fair value of options granted during the period | $ / shares | $ 0 |
Weighted Average Remaining Contractual Life (Years), Granted options | 1 year 4 months 10 days |
Weighted Average Remaining Contractual Life (Years), outstanding | 10 months 13 days |
STOCKHOLDERS' EQUITY (DEFICIT34
STOCKHOLDERS' EQUITY (DEFICIT) (Details 2) | 6 Months Ended |
Jun. 30, 2016$ / sharesshares | |
Warrant exercise price | $ 4.50 |
Warrants outstanding at end of period | shares | 5,000 |
Weighted Average Remaining Contractual Life | 10 months 13 days |
Weighted Average Exercise Price | $ 4.50 |
Number exercisable at end of period | shares | 5,000 |
Weighted Average Exercise Price | $ 4.50 |
Warrant $4.50 [Member] | |
Warrant exercise price | $ 4.50 |
Warrants outstanding at end of period | shares | 5,000 |
Weighted Average Remaining Contractual Life | 10 months 13 days |
Weighted Average Exercise Price | $ 4.50 |
Number exercisable at end of period | shares | 5,000 |
Weighted Average Exercise Price | $ 4.50 |
STOCKHOLDERS' EQUITY (DEFICIT35
STOCKHOLDERS' EQUITY (DEFICIT) (Details Narrative) - $ / shares | Jun. 30, 2016 | Dec. 31, 2015 |
Preferred stock, shares authorized | 50,000,000 | |
Preferred stock par value | $ 0.0001 | |
Common stock, shares authorized | 750,000,000 | 750,000,000 |
Common stock par value | $ .0001 | $ .0001 |
Common stock, shares issued | 34,213,004 | 19,252,082 |
Common stock, shares outstanding | 19,252,082 | 19,252,082 |
Series A Preferred Stock | ||
Preferred stock, shares authorized | 20,000 | 20,000 |
Preferred stock par value | $ 0.0001 | $ 0.0001 |
Preferred stock, shares issued | 0 | 0 |
Preferred stock, shares outstanding | 0 | 0 |
Preferred stock, Series B | ||
Preferred stock, shares authorized | 30,000 | 30,000 |
Preferred stock par value | $ 0.0001 | $ .0001 |
Preferred stock, shares issued | 6,667 | 6,667 |
Preferred stock, shares outstanding | 6,667 | 6,667 |
Preferred stock, Series C | ||
Preferred stock, shares authorized | 4,000,000 | 4,000,000 |
Preferred stock par value | $ 0.0001 | $ 0.0001 |
Preferred stock, shares issued | 3,190,365 | 3,337,442 |
Preferred stock, shares outstanding | 3,337,442 | 3,337,442 |
Series D Preferred Stock | ||
Preferred stock, shares authorized | 5,000,000 | 5,000,000 |
Preferred stock par value | $ 0.0001 | $ 0.0001 |
Preferred stock, shares issued | 4,063,843 | 4,673,010 |
Preferred stock, shares outstanding | 4,673,010 | 4,673,010 |
Preferred stock, Series E | ||
Preferred stock, shares authorized | 8,746,000 | 8,746,000 |
Preferred stock par value | $ 0.0001 | $ 0.0001 |
Preferred stock, shares issued | 8,504,569 | 8,621,589 |
Preferred stock, shares outstanding | 8,621,589 | 8,621,589 |
Preferred stock, Series F | ||
Preferred stock, shares authorized | 1,100,000 | 1,100,000 |
Preferred stock par value | $ 0.0001 | $ 0.0001 |
Preferred stock, shares issued | 1,099,998 | 1,099,998 |
Preferred stock, shares outstanding | 1,099,998 | 1,099,998 |
Preferred stock, Series G | ||
Preferred stock, shares authorized | 10,090,000 | 10,090,000 |
Preferred stock par value | $ .0001 | $ .0001 |
Preferred stock, shares issued | 10,083,351 | 10,083,351 |
Preferred stock, shares outstanding | 10,083,351 | 10,083,351 |
PREPAID EXPENSES (Details Narra
PREPAID EXPENSES (Details Narrative) - USD ($) | Jun. 30, 2016 | Dec. 31, 2015 |
Deferred Costs, Capitalized, Prepaid, and Other Assets Disclosure [Abstract] | ||
Prepaid expenses, current | $ 238,137 | $ 191,677 |
Prepaid expenses, noncurrent | $ 80,137 | $ 189,968 |
INTANGIBLE ASSETS (Details)
INTANGIBLE ASSETS (Details) | Jun. 30, 2016USD ($) |
Goodwill and Intangible Assets Disclosure [Abstract] | |
2,016 | $ 12,500 |
2,017 | 25,000 |
2,018 | 25,000 |
2,019 | 25,000 |
2020 and thereafter | 125,000 |
Total | $ 212,500 |
INTANGIBLE ASSETS (Details Narr
INTANGIBLE ASSETS (Details Narrative) - USD ($) | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2016 | Jun. 30, 2015 | Jun. 30, 2016 | Jun. 30, 2015 | |
Goodwill and Intangible Assets Disclosure [Abstract] | ||||
Amortization expense | $ 6,250 | $ 6,250 | $ 12,500 | $ 12,500 |
PROPERTY AND EQUIPMENT (Details
PROPERTY AND EQUIPMENT (Details) - USD ($) | Jun. 30, 2016 | Dec. 31, 2015 |
Property, Plant and Equipment [Abstract] | ||
Office furniture and fixtures | $ 113,681 | $ 95,434 |
Computer equipment | 24,302 | 24,766 |
Appliques | 2,160,096 | 2,160,096 |
Website development | 105,271 | 92,399 |
Less accumulated depreciation | 287,658 | (154,002) |
Total | $ 2,115,692 | $ 2,218,693 |
PROPERTY AND EQUIPMENT (Detai40
PROPERTY AND EQUIPMENT (Details Narrative) - USD ($) | 6 Months Ended | |
Jun. 30, 2016 | Jun. 30, 2015 | |
Property, Plant and Equipment [Abstract] | ||
Depreciation expense | $ 133,656 | $ 29,515 |
INVENTORIES (Details)
INVENTORIES (Details) - USD ($) | Jun. 30, 2016 | Dec. 31, 2015 |
Inventory Disclosure [Abstract] | ||
Finished goods | $ 289,522 | $ 251,518 |
Less reserve for obsolete inventory | 0 | 0 |
Total | $ 289,522 | $ 251,518 |
RELATED PARTY TRANSACTIONS (Det
RELATED PARTY TRANSACTIONS (Details Narrative) - Phipps [Member] - USD ($) | 6 Months Ended | |
Jun. 30, 2016 | Dec. 31, 2015 | |
Payable to related party | $ 85,622 | $ 74,051 |
Related Party [Member] | ||
Compensation | $ 25,210 |
DERIVATIVE LIABILITIES (Details
DERIVATIVE LIABILITIES (Details) | 6 Months Ended |
Jun. 30, 2016$ / shares | |
Derivative Instruments Details | |
Expected volatility | 238.00% |
Expected term - years | 10 months 10 days |
Risk-free interest rate | 0.58% |
Expected dividend yield | $ 0 |
DERIVATIVE LIABILITIES (Detai44
DERIVATIVE LIABILITIES (Details Narrative) - USD ($) | 6 Months Ended | 12 Months Ended |
Jun. 30, 2016 | Dec. 31, 2015 | |
Notes to Financial Statements | ||
Derivative liabilities | $ 2,484 | $ 311,373 |
Gain (loss) resulting from increase in fair value of convertible instrument | $ 1,872 | $ 580 |
CONCENTRATIONS - (Details)
CONCENTRATIONS - (Details) - USD ($) | 6 Months Ended | |
Jun. 30, 2016 | Jun. 30, 2015 | |
Network Innovations | ||
Concentration risk | 31.50% | 15.90% |
Purchases | $ 424,605 | $ 207,479 |
Globalstar Europe | ||
Concentration risk | 10.90% | 0.00% |
Purchases | $ 146,547 | $ 0 |