Document_and_Entity_Informatio
Document and Entity Information (USD $) | 12 Months Ended |
Dec. 31, 2013 | |
Document and Entity Information: | ' |
Entity Registrant Name | 'FULLNET COMMUNICATIONS INC |
Document Type | '10-K |
Document Period End Date | 31-Dec-13 |
Amendment Flag | 'false |
Entity Central Index Key | '0001092570 |
Current Fiscal Year End Date | '--12-31 |
Entity Common Stock, Shares Outstanding | 9,118,161 |
Entity Public Float | $263,207 |
Entity Filer Category | 'Smaller Reporting Company |
Entity Current Reporting Status | 'No |
Entity Voluntary Filers | 'No |
Entity Well-known Seasoned Issuer | 'No |
Document Fiscal Year Focus | '2013 |
Document Fiscal Period Focus | 'FY |
CONDENSED_CONSOLIDATED_BALANCE
CONDENSED CONSOLIDATED BALANCE SHEETS (USD $) | Dec. 31, 2013 | Dec. 31, 2012 | ||
ASSETS | ' | ' | ||
Cash | $30,072 | $10,847 | ||
Accounts receivable, net | 17,540 | 15,671 | ||
Prepaid expenses and other current assets | 8,728 | 6,403 | ||
Total current assets | 56,340 | 32,921 | ||
PROPERTY AND EQUIPMENT, net | 44,635 | 55,836 | ||
OTHER ASSETS AND INTANGIBLE ASSETS | 10,948 | 16,858 | ||
TOTAL ASSETS | 111,923 | 105,615 | ||
LIABILITIES AND STOCKHOLDERS' DEFICIT | ' | ' | ||
Accounts payable | 127,077 | 482,286 | ||
Accrued and other liabilities | 410,763 | 1,077,023 | ||
Convertible notes payable, related party - current portion | 45,060 | 304,206 | ||
Deferred revenue | 302,129 | 198,837 | ||
Total current liabilities | 885,029 | 2,062,352 | ||
CONVERTIBLE NOTES PAYABLE, related party - less current portion | 230,129 | 0 | ||
Total liabilities | 1,115,158 | 2,062,352 | ||
STOCKHOLDERS' DEFICIT | ' | ' | ||
Preferred stock | 430,382 | [1] | 0 | |
Common stock | 91 | [2] | 91 | [3] |
Additional paid-in capital | 8,716,803 | 8,417,050 | ||
Accumulated deficit | -10,150,511 | -10,373,878 | ||
Total stockholders' deficit | -1,003,235 | -1,956,737 | ||
TOTAL LIABILITES AND STOCKHOLDERS' DEFICIT | $111,923 | $105,615 | ||
[1] | $.001 par value; authorized, 10,000,000 shares; Series A convertible issued and outstanding, 987,102 shares | |||
[2] | $.00001 par value; authorized, 40,000,000 shares; issued and outstanding, 9,118,161 shares | |||
[3] | $.00001 par value; authorized, 10,000,000 shares; issued and outstanding, 9,118,161 shares |
CONDENSED_CONSOLIDATED_BALANCE1
CONDENSED CONSOLIDATED BALANCE SHEETS (Parenthetical) (USD $) | Dec. 31, 2013 | Dec. 31, 2012 |
Statement of Financial Position Parenthetical | ' | ' |
Preferred stock, par value | $0.00 | $0 |
Preferred stock, shares authorized | 10,000,000 | 0 |
Preferred stock Series A convertible, shares outstanding | 987,102 | 0 |
Common stock, par value | $0.00 | $0.00 |
Common stock, shares authorized | 40,000,000 | 10,000,000 |
Common stock, shares outstanding | 9,118,161 | 9,118,161 |
CONDENSED_CONSOLIDATED_STATEME
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (USD $) | 12 Months Ended | |
Dec. 31, 2013 | Dec. 31, 2012 | |
Income Statement | ' | ' |
Access service revenues | $112,613 | $159,692 |
Co-location and other revenues | 1,514,247 | 1,434,540 |
Total revenues | 1,626,860 | 1,594,232 |
Cost of access service revenues | 109,716 | 125,961 |
Cost of co-location and other revenues | 327,296 | 357,223 |
Selling, general and administrative expenses | 1,318,810 | 1,240,627 |
Depreciation and amortization | 29,087 | 39,620 |
Impairment expense | 0 | 31,295 |
Total operating costs and expenses | 1,784,909 | 1,794,726 |
INCOME (LOSS) FROM OPERATIONS | -158,049 | -200,494 |
GAIN ON SERIES A CONVERTIBLE PREFERRED STOCK ISSUED IN EXCHANGE FOR INDEBTEDNESS | 401,004 | 0 |
INTEREST EXPENSE | -19,588 | -22,604 |
NET INCOME (LOSS) | 223,367 | -223,098 |
Preferred stock dividends | -67,247 | 0 |
Net income (loss) available to common stockholders | $156,120 | ($223,098) |
Net income (loss) per common share -basic | $0.02 | ($0.02) |
Net income (loss) per common share - assuming dilution | $0.01 | ($0.02) |
Weighted average shares outstanding - basic | 9,118,161 | 9,087,942 |
Weighted average shares outstanding - assuming dilution | 11,698,069 | 9,087,942 |
CONDENSED_CONSOLIDATED_STATEME1
CONDENSED CONSOLIDATED STATEMENT OF STOCKHOLDERS' EQUITY (USD $) | Common Stock | Preferred Stock | Additional Paid In Capital | Accumulated Deficit | Total |
Stockholders' deficit at Dec. 31, 2011 | $90 | $0 | $8,409,945 | ($10,150,780) | ($1,740,745) |
Shares outstanding at Dec. 31, 2011 | 8,978,161 | 0 | ' | ' | 8,978,161 |
Stock options compensation | ' | ' | 3,412 | ' | 3,412 |
Stock warrants issued for services | ' | ' | ' | ' | 0 |
Stock options exercise | 1 | 0 | 419 | ' | 420 |
Stock options exercise, shares | 140,000 | 0 | ' | ' | 140,000 |
Warrant extension granted in settlement of liabilities | ' | ' | 3,274 | ' | 3,274 |
Net income (loss) | ' | ' | ' | -223,098 | -223,098 |
Stockholders' deficit at Dec. 31, 2012 | 91 | 0 | 8,417,050 | -10,373,878 | -1,956,737 |
Shares outstanding at Dec. 31, 2012 | 9,118,161 | 0 | ' | ' | 9,118,161 |
Stock options compensation | ' | ' | 51,481 | ' | 51,481 |
Series A convertible preferred stock issued in settlement of liabilities | 0 | 672,472 | 0 | ' | 672,472 |
Preferred stock issued, shares | 0 | 987,102 | 0 | 0 | 987,102 |
Increasing dividend rate preferred stock discount | 0 | -309,337 | 309,337 | 0 | ' |
Amortization of increasing dividend rate preferred stock discount | 0 | 67,247 | -67,247 | 0 | ' |
Stock warrants issued for services | ' | ' | 6,182 | ' | 6,182 |
Stock options exercise | ' | ' | ' | ' | 0 |
Net income (loss) | ' | ' | ' | 223,367 | 223,367 |
Stockholders' deficit at Dec. 31, 2013 | $91 | $430,382 | $8,716,803 | ($10,150,511) | ($1,003,235) |
Shares outstanding at Dec. 31, 2013 | 9,118,161 | 987,102 | ' | ' | 10,105,263 |
CONDENSED_CONSOLIDATED_STATEME2
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (USD $) | 12 Months Ended | |
Dec. 31, 2013 | Dec. 31, 2012 | |
Cash Flow Statement | ' | ' |
Net income (loss) | $223,367 | ($223,098) |
Depreciation and amortization | 29,087 | 39,620 |
Stock options compensation | 51,481 | 3,412 |
Stock warrants issued for services | 6,182 | 0 |
Impairment expense | 0 | 31,295 |
Provision for uncollectible accounts receivable | 13,643 | 16,388 |
(Gain) on Series A convertible preferred stock issued in exchange for indebtedness | -401,004 | 0 |
Net (increase) decrease in Accounts receivable | -15,512 | 47,478 |
Net (increase) decrease in Prepaid expenses and other current assets | -2,325 | 7,891 |
Net increase (decrease) in Accounts payable | 35,134 | 90,359 |
Net increase (decrease) in Accrued and other liabilities | 11,873 | 32,400 |
Net increase (decrease) in Deferred revenue | 103,292 | -8,243 |
Net cash provided by operating activities | 55,218 | 37,502 |
Purchases of property and equipment | -11,976 | -14,190 |
Net cash used in investing activities | -11,976 | -14,190 |
Principal payments on borrowings under notes payable | -24,017 | -23,872 |
Proceeds from exercise of stock options | 0 | 420 |
Net cash used in financing activities | -24,017 | -23,452 |
Net increase (decrease) in cash | 19,225 | -140 |
Cash at beginning of period | 10,847 | 10,987 |
Cash at end of period | 30,072 | 10,847 |
Cash paid for interest | 19,075 | 20,934 |
Warrant extension granted in settlement of liabilities | ' | 3,274 |
Acquisition of assets and liabilities through debt | ' | 45,366 |
Series A convertible preferred stock issued for settlement of debt and accrued interest | 59,634 | ' |
Series A convertible preferred stock issued for settlement of accounts payable | 317,961 | ' |
Series A convertible preferred stock issued for settlement of deferred compensation | 656,133 | ' |
Reclassification of accounts payable to convertible debt - related party | $50,000 | ' |
Note_A_Summary_of_Accounting_P
Note A - Summary of Accounting Policies and Nature of Operations | 12 Months Ended | ||||||||
Dec. 31, 2013 | |||||||||
Notes | ' | ||||||||
Note A - Summary of Accounting Policies and Nature of Operations | ' | ||||||||
NOTE A — SUMMARY OF ACCOUNTING POLICIES AND NATURE OF OPERATIONS | |||||||||
A summary of the significant accounting policies consistently applied in the preparation of the accompanying consolidated financial statements follows. | |||||||||
Nature of Operations | |||||||||
FullNet Communications, Inc. and Subsidiaries (the Company) is an integrated communications provider (ICP) offering integrated communications, Internet connectivity and data storage to individuals, businesses, organizations, educational institutions and governmental agencies. Through its subsidiaries, FullNet, Inc., FullTel, Inc. and FullWeb, Inc., the Company provides high quality, reliable and scalable Internet solutions designed to meet customer needs. Services offered include: | |||||||||
• | Dial-up and direct high-speed connectivity to the Internet through the FullNet brand name; | ||||||||
• | Backbone services to private label Internet services providers (ISPs) and businesses; | ||||||||
• | Carrier-neutral telecommunications premise co-location; | ||||||||
• | Web page hosting; | ||||||||
• | Equipment co-location; | ||||||||
• | Advanced voice and data solutions; and | ||||||||
• | Traditional telephone services. | ||||||||
Consolidation | |||||||||
The consolidated financial statements include the accounts of FullNet Communications, Inc. and its wholly owned subsidiaries FullNet, Inc., FullTel, Inc., FullWeb, Inc., and CallMultiplier, Inc.. All material inter-company accounts and transactions have been eliminated. | |||||||||
Use of Estimates | |||||||||
The preparation of financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect certain reported amounts and disclosures; accordingly, actual results could differ from those estimates. | |||||||||
Cash Equivalents | |||||||||
Cash equivalents are represented by operating accounts or money market accounts maintained with insured financial institutions which consist of highly liquid investments that mature in three months or less from date of purchase. | |||||||||
Accounts Receivable | |||||||||
The Company operates and grants credit, on an uncollateralized basis. Concentrations of credit risk with respect to accounts receivable are limited due to the large number of customers comprising the Company’s customer base and their dispersion across different industries. | |||||||||
Accounts receivable, other than certain large customer accounts which are evaluated individually, are considered past due for purposes of determining the allowance for doubtful accounts based on past experience of collectability as follows: | |||||||||
1 – 29 days | 1.5 | % | |||||||
30 – 59 days | 30 | % | |||||||
60 – 89 days | 50 | % | |||||||
> 90 days | 100 | % | |||||||
In addition, if the Company becomes aware of a specific customer’s inability to meet its financial obligations, a specific reserve is recoded against amounts due to reduce the net recognized receivable to the amount reasonably expected to be collected. | |||||||||
Total bad debt expense and direct write off for the years ended December 31, 2013 and 2012 were $13,643 and $16,388, respectively. | |||||||||
Accounts receivable consist of the following at December 31: | |||||||||
Schedule of Accounts Receivable | |||||||||
2013 | 2012 | ||||||||
Accounts receivable | $ 261,510 | $ 252,636 | |||||||
Less allowance for doubtful accounts | (243,970) | (236,965) | |||||||
$ 17,540 | $ 15,671 | ||||||||
Property and Equipment | |||||||||
Property and equipment are stated at cost. Depreciation is computed primarily using the straight-line method over the estimated useful lives of the related assets as follows: | |||||||||
Software | 3 years | ||||||||
Computers and equipment | 5 years | ||||||||
Furniture and fixtures | 7 years | ||||||||
Leasehold improvements | Shorter of estimated life of improvement or the lease term | ||||||||
Property and equipment consist of the following at December 31: | |||||||||
Schedule of Property and Equipment | |||||||||
2013 | 2012 | ||||||||
Computers and equipment | $ 1,536,744 | $ 1,527,170 | |||||||
Leasehold improvements | 994,152 | 991,750 | |||||||
Software | 57,337 | 57,337 | |||||||
Furniture and fixtures | 31,821 | 31,821 | |||||||
2,620,054 | 2,608,078 | ||||||||
Less accumulated depreciation | (2,575,419) | (2,552,242) | |||||||
$ 44,635 | $ 55,836 | ||||||||
Depreciation expense for the years ended December 31, 2013 and 2012 was $23,177 and $36,495, respectively. | |||||||||
Long-Lived Assets | |||||||||
All long-lived assets held and used by the Company, including intangible assets, are reviewed to determine whether any events or changes in circumstances indicate that the carrying amount of the asset may not be recoverable. . In accordance with ASC 360-10-35 “Impairment or Disposal of Long-lived Assets”, the Company bases its evaluation on such impairment indicators as the nature of the assets, the future economic benefit of the assets, any historical or future profitability measurements, as well as other external market conditions or factors that may be present. If such impairment indicators are present or other factors exist that indicate that the carrying amount of the asset may not be recoverable the Company determines whether impairment has occurred through the use of an undiscounted cash flows analysis of the asset. If impairment has occurred, the Company recognizes a loss for the difference between the carrying amount and the estimated value of the asset. | |||||||||
The Company incurred an impairment expense of $31,295 in 2012 and no impairment expense was incurred in 2013. Amortization expense for the years ended December 31, 2013 and 2012 was $5,910 and $3,125, respectively | |||||||||
Revenue Recognition | |||||||||
Revenues are reported on a monthly basis as services are provided, price is fixed and determinable, persuasive evidence of an arrangement exists and collectability of the resulting receivable is reasonably assured.. Revenue that is received in advance of the services provided is deferred until the services are provided by the Company. Revenue related to set up charges is also deferred and amortized over the life of the contract. Revenues are presented net of taxes and fees billed to customers and remitted to governmental authorities. | |||||||||
Advertising | |||||||||
The Company expenses advertising production costs as they are incurred and advertising communication costs the first time the advertising takes place. | |||||||||
Advertising expense for the years ended December 31, 2013 and 2012 was $61,753 and $51,632, respectively. | |||||||||
Income Taxes | |||||||||
The Company accounts for income taxes utilizing ASC 740, “Income Taxes” (SFAS No. 109). ASC 740 requires the measurement of deferred tax assets for deductible temporary differences and operating loss carry forwards, and of deferred tax liabilities for taxable temporary differences. Measurement of current and deferred tax liabilities and assets is based on provisions of enacted tax law. The effects of future changes in tax laws or rates are not included in the measurement. The Company recognizes the amount of taxes payable or refundable for the current year and recognizes deferred tax liabilities and assets for the expected future tax consequences of events and transactions that have been recognized in the Company’s financial statements or tax returns. The Company currently has substantial net operating loss carry forwards. The Company has recorded a 100% valuation allowance against net deferred tax assets due to uncertainty of their ultimate realization. Valuation allowances are established when necessary to reduce deferred tax assets to the amount expected to be realized. | |||||||||
The Company recognizes interest and penalties related to unrecognized tax benefits in income tax expense and does not believe it has any material unrealized tax benefits at December 31, 2013. The Company files income tax returns in the U.S. federal jurisdiction and various state and local jurisdictions. | |||||||||
Income Per Share | |||||||||
Income (loss) per share – basic is calculated by dividing net income by the weighted average number of shares of stock outstanding during the year, including shares issuable without additional consideration. Income per share – assuming dilution is calculated by dividing net income by the weighted average number of shares outstanding during the year adjusted for the effect of dilutive potential shares calculated using the treasury stock method. | |||||||||
Schedule of Income (Loss) Per Share | |||||||||
2013 | 2012 | ||||||||
Numerator: | |||||||||
Net income (loss) available to common shareholders | $ 156,120 | $ (223,098) | |||||||
Denominator: | |||||||||
Weighted average shares and share equivalents outstanding – basic | 9,118,161 | 9,087,942 | |||||||
Effect of dilutive preferred stock | 987,102 | - | |||||||
Effect of dilutive stock options | 871,361 | - | |||||||
Effect of dilutive warrants | 721,445 | - | |||||||
Weighted average shares and share equivalents outstanding – assuming dilution | 11,698,069 | 9,087,942 | |||||||
Net income (loss) per share — basic | $ .02 | $ (.02) | |||||||
Net income (loss) per share — assuming dilution | $ .01 | $ (.02) | |||||||
Anti-dilutive securities excluded (1) | 1,885,389 | - | |||||||
—————————— | |||||||||
(1) Anti-dilutive securities consist of stock options, warrants and convertible promissory notes that were not included in the computation of diluted earnings per share because the exercise price was greater than the average market price of the common stock. | |||||||||
Basic and diluted loss per share were the same for the year ended December 31, 2012 because there was a net loss for the year. | |||||||||
Stock-Based Compensation | |||||||||
The Company does not have a written employee stock option plan. The Company has historically granted only employee stock options with an exercise price equal to the market price of the Company’s stock at the date of grant, a contractual term of ten years, and a vesting period of three years ratably on the first, second and third anniversaries of the date of grant (with limited exceptions). | |||||||||
All employee stock options granted during 2013 and 2012 were nonqualified stock options. Stock-based compensation is measured at the grant date, based on the calculated fair value of the option, and is recognized as an expense on a straight-line basis over the requisite employee service period (generally the vesting period of the grant). | |||||||||
The fair values of the granted options are estimated at the date of grant using the Black-Scholes option pricing model. See Note G – Common Stock and Stock-Based Compensation for further information on stock-based compensation. | |||||||||
Beneficial Conversion Features | |||||||||
The intrinsic value of a beneficial conversion feature inherent to a convertible note payable, which is not bifurcated and accounted for separately from the convertible note payable and may not be settled in cash upon conversion, is treated as a discount to the convertible note payable. This discount is amortized over the period from the date of issuance to the date the note is due using the effective interest method. If the note payable is retired prior to the end of its contractual term, the unamortized discount is expensed in the period of retirement to interest expense. In general, the beneficial conversion feature is measured by comparing the effective conversion price, after considering the relative fair value of detachable instruments included in the financing transaction, if any, to the fair value of the common shares at the commitment date to be received upon conversion. | |||||||||
Related Parties | |||||||||
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. | |||||||||
Fair Value Measurements | |||||||||
The Company measures its financial assets and liabilities in accordance with the requirements of FASB ASC 820, “Fair Value Measurements and Disclosures”. ASC 820 clarifies the definition of fair value, prescribes methods for measuring fair value, and establishes a fair value hierarchy to classify the inputs used in measuring fair value as follows: | |||||||||
Level 1 – Quoted prices are available in active markets for identical assets or liabilities as of the reporting date. Active markets are those in which transactions for the asset or liability occur in sufficient frequency and volume to provide pricing information on an ongoing basis. Level 1 primarily consists of financial instruments such as exchange-traded derivatives, marketable securities and listed equities. | |||||||||
Level 2 - Pricing inputs are other than quoted prices in active markets included in level 1, which are either directly or indirectly observable as of the reported date and includes those financial instruments that are valued using models or other valuation methodologies. These models are primarily industry-standard models that consider various assumptions, including quoted forward prices for commodities, time value, volatility factors, and current market and contractual prices for the underlying instruments, as well as other relevant economic measures. Substantially all of these assumptions are observable in the marketplace throughout the full term of the instrument, can be derived from observable data or are supported by observable levels at which transactions are executed in the marketplace. Instruments in this category generally include non-exchange-traded derivatives such as commodity swaps, interest rate swaps, options and collars. | |||||||||
Level 3 – Pricing inputs include significant inputs that are generally less observable from objective sources. These inputs may be used with internally developed methodologies that result in management’s best estimate of fair value. | |||||||||
Recent Accounting Pronouncements | |||||||||
There have been no recent accounting pronouncements that would impact our financial statements. | |||||||||
NOTE B — GOING CONCERN | |||||||||
The accompanying financial statements have been prepared in conformity with generally accepted accounting principles | |||||||||
, which contemplate continuation of the Company as a going concern. | |||||||||
However, the Company has sustained substantial net losses. At December 31, 2013 and 2012 current liabilities exceeded current assets by $828,689 and $2,029,431, respectively. These factors raise substantial doubt about the Company’s ability to continue as a going concern. | |||||||||
In view of the matters described in the preceding paragraph, the ability of the Company to continue as a going concern is dependent upon continued operations of the Company that in turn is dependent upon the Company’s ability to meet its financing requirements on a continuing basis, to maintain present financing, to achieve the objectives of its business plan and to succeed in its future operations. The financial statements do not include any adjustments relating to the recoverability and classification of recorded asset amounts or amounts and classification of liabilities that might be necessary should the Company be unable to continue in existence. | |||||||||
The Company’s business plan includes, among other things, expansion through mergers and acquisitions and the development of its web hosting, co-location, traditional telephone services and advanced voice and data solutions. Execution of the Company’s business plan will require significant capital to fund capital expenditures, working capital needs and debt service. Current cash balances will not be sufficient to fund the Company’s current business plan beyond the next few months. As a consequence, the Company is currently focusing on revenue enhancement and cost cutting opportunities as well as working to sell non-core assets and to extend vendor payment terms. The Company continues to seek additional convertible debt or equity financing as well as the placement of a credit facility to fund the Company’s liquidity. There can be no assurance that the Company will be able to obtain additional capital on satisfactory terms, or at all, or on terms that will not dilute the shareholders’ interests. |
Note_C_Restatement
Note C - Restatement | 12 Months Ended | |||||||
Dec. 31, 2013 | ||||||||
Notes | ' | |||||||
Note C - Restatement | ' | |||||||
NOTE C — RESTATEMENT | ||||||||
Errors resulting in an overstatement of previously reported 2012 accounts receivable and selling, general and administrative expense of $28,640 and $5,736, respectively, and an understatement of other assets, other liabilities, amortization expense and impairment expense of $11,608, $10,990, $2,462 and $31,295, respectively were discovered in 2013. In addition, an error in the calculation of depreciation expense resulted in an understatement of $5,463. Correction of the above errors resulted in an increase of $33,485 in the Company’s net loss. Also, reclassifications were made to prior period balances of accrued and other liabilities, cost of access service revenues and cost of co-location and other revenues to conform to the presentation for the current period. | ||||||||
The restatements to balance sheet accounts as of December 31, 2012 are as follows: | ||||||||
As of December 31, 2012 | ||||||||
As Reported | Adjustments | As Restated | ||||||
CURRENT ASSETS | ||||||||
Cash | $ 10,847 | $ - | $ 10,847 | |||||
Accounts receivable, net | 44,311 | (28,640) | -1 | 15,671 | ||||
Prepaid expenses and other current assets | 6,403 | - | 6,403 | |||||
Total current assets | 61,561 | (28,640) | 32,921 | |||||
PROPERTY AND EQUIPMENT, net | 61,299 | (5,463) | -2 | 55,836 | ||||
OTHER ASSETS AND INTANGIBLE ASSETS | 5,250 | 11,608 | -1 | 16,858 | ||||
TOTAL ASSETS | $ 128,110 | $ (22,495) | $ 105,615 | |||||
CURRENT LIABILITIES | ||||||||
Accounts payable | $ 482,286 | $ - | $ 482,286 | |||||
Accrued and other liabilities, current portion | 281,808 | 795,215 | -3 | 1,077,023 | ||||
Convertible notes payable, related party - current portion | 304,206 | - | 304,206 | |||||
Deferred revenue | 198,837 | - | 198,837 | |||||
Total current liabilities | 1,267,137 | 795,215 | 2,062,352 | |||||
ACCRUED AND OTHER LIABILITIES, less current portion | 784,225 | (784,225) | -3 | - | ||||
Total liabilities | 2,051,362 | 10,990 | 2,062,352 | |||||
STOCKHOLDERS’ DEFICIT | ||||||||
Common stock | 91 | - | 91 | |||||
Additional paid-in capital | 8,417,050 | - | 8,417,050 | |||||
Accumulated deficit | (10,340,393) | (33,485) | -10,373,878 | |||||
Total stockholders’ deficit | (1,923,252) | (33,485) | (1,956,737) | |||||
TOTAL LIABILITIES AND STOCKHOLDERS’ DEFICIT | $ 128,110 | $ (22,495) | $ 105,615 | |||||
—————————— | ||||||||
(1) To correct an error in the recording of certain assets which were mistakenly recorded as accounts receivable instead of intangible assets. | ||||||||
(2) To correct an error in the calculation of depreciation expense. | ||||||||
(3) Reclassifications to conform to the presentation of the current period. | ||||||||
The restatements to income statement accounts for the year ended December 31, 2012 are as follows: | ||||||||
Year ended December 31, 2012 | ||||||||
As Reported | Adjustments | |||||||
As Restated | ||||||||
REVENUES | ||||||||
Access service revenues | $ 159,692 | $ - | $ 159,692 | |||||
Co-location and other revenues | 1,434,540 | - | 1,434,540 | |||||
Total revenues | 1,594,232 | - | 1,594,232 | |||||
OPERATING COSTS AND EXPENSES | ||||||||
Cost of access service revenues | 135,051 | (9,090) | -3 | 125,961 | ||||
Cost of co-location and other revenues | 348,133 | 9.090 | -3 | 357,223 | ||||
Selling, general and administrative expenses | 1,246,363 | (5,736) | -1 | 1,240,627 | ||||
Depreciation and amortization | 31,694 | 7,926 | -2 | 39,620 | ||||
Impairment expense | - | 31,295 | -1 | 31,295 | ||||
Total operating costs and expenses | 1,761,241 | 33,485 | 1,794,726 | |||||
LOSS FROM OPERATIONS | (167,009) | (33,485) | (200,494) | |||||
INTEREST EXPENSE | (22,604) | - | (22,604) | |||||
LOSS before income taxes | (189,613) | (33,485) | (223,098) | |||||
NET LOSS | $ (189,613) | $ (33,485) | $ (223,098) | |||||
—————————— | ||||||||
(1) To recognize impairment expense on certain intangible assets. | ||||||||
(2) To correct an error in selling, general and administrative expense; and errors in the calculation of depreciation and amortization expense. | ||||||||
(3) Reclassifications to conform to the presentation of the current period. |
Note_D_Convertible_Notes_Payab
Note D - Convertible Notes Payable Related Party | 12 Months Ended | ||||||||
Dec. 31, 2013 | |||||||||
Notes | ' | ||||||||
Note D - Convertible Notes Payable Related Party | ' | ||||||||
NOTE D — CONVERTIBLE NOTES PAYABLE RELATED PARTY | |||||||||
Notes payable consist of the following: | |||||||||
Schedule of Notes Payable | |||||||||
31-Dec-13 | 31-Dec-12 | ||||||||
Convertible promissory note; interest at 12.5% of face amount, payable quarterly; this note is unsecured and matured in November 2003 (convertible into approximately 107,843 shares at December 31, 2012) (1) | $ - | $ 55,000 | |||||||
Secured promissory note from a shareholder; interest at 6%, required monthly installments of interest only through December 30, 2010, then required monthly installments of $3,301 including principal and interest; matured December 30, 2011; secured by all tangible and intangible assets of the Company (2) | - | 249,206 | |||||||
Secured convertible promissory note from a shareholder; interest rate of 6% through December 31, 2014, 7% through December 31, 2015, 8% through December 31, 2016, 8.5% through December 31, 2017, and 9% through May 31, 2018, with fixed monthly payments of $3,301 through the Maturity Date, at which time the remaining balance of principal and all accrued interest shall be due and payable; matures May 31, 2018; secured by all tangible and intangible assets of the Company (2)(3) | 225,189 | - | |||||||
Secured convertible promissory note; interest at 6%, requires monthly installments of interest only through May 31, 2014, then requires monthly installments of $600 including principal and interest; matures May 31, 2023; secured by certain equipment of the Company (4) | 50,000 | - | |||||||
275,189 | 304,206 | ||||||||
Less current portion | 45,060 | 304,206 | |||||||
Convertible notes payable, related party - less current portion | $ 230,129 | $ - | |||||||
—————————— | |||||||||
(1) This convertible promissory note matured in November 2003. On June 3, 2013, the Company issued 59,634 shares of its Series A Convertible Preferred Stock, in complete satisfaction of the outstanding principal and accrued interest due on this note of $59,634 and $57,248 was recognized as gain on settlement of debt for the year ended December 31, 2013 (see Note H – Series A Convertible Preferred Stock). | |||||||||
(2) This secured promissory note matured on December 30, 2011. During the year of 2012, the Company continued to make principal and interest payments of $23,872 and $15,739, respectively. During the year of 2013, the Company continued to make principal and interest payments of $9,702 and $6,801, respectively. At May 31, 2013, the outstanding principal and accrued interest of the secured promissory note was $239,504. | |||||||||
(3) On May 31, 2013, the Company issued this secured convertible promissory note in exchange for the existing secured promissory note with a balance due, including accrued interest, of $239,504, which had matured on December 30, 2011. The secured convertible promissory note extended the maturity date to May 31, 2018 and increased the interest rate as noted above. The note holder has the right to convert the note, in its entirety or in part, into common stock of the Company at the rate of $1.00 per share. During the year 2013, the Company made principal payments of $14,315. The secured convertible promissory note had a balance of $225,189 at December 31, 2013. | |||||||||
The Company analyzed the modification of the term under ASC 470-60 “Trouble Debt Restructurings” and ASC 470-50 “Extinguishment of Debt”. The Company determined the creditor has not granted a concession and the modification of the embedded conversion options does not fall in the scope of ASC 470-50. | |||||||||
The Company analyzed the conversion option for derivative accounting and beneficial conversion features consideration under ASC 815-15 “Derivatives and Hedging” and ASC 470-20 “Convertible Securities with Beneficial Conversion Features” and noted none. | |||||||||
(4) On May 31, 2013, the Company issued this secured convertible promissory note and on June 3, 2013, issued 203,169 shares of its Series A convertible preferred stock, in complete satisfaction of the balance due in the amount of $253,169 on an operating lease for certain equipment which was leased from one of its shareholders whose parent company holds a $225,189 secured convertible promissory note. The Company recognized $195,042 as gain on settlement of accounts payable for the year ended December 31, 2013 (see Note H – Series A Convertible Preferred Stock). | |||||||||
The Company had been unable to make all of the required payments pursuant to the terms of the September 2007 agreement. This secured convertible promissory note is secured by the equipment leased by the Company pursuant to the aforementioned operating lease. Upon payment of the balance due on this secured convertible promissory note title of the equipment will be transferred to the Company free and clear of all liens and encumbrances. | |||||||||
The note holder has the right to convert the note, in its entirety or in part, into common stock of the Company at the rate of $1.00 per share. | |||||||||
The Company analyzed the conversion option for derivative accounting and beneficial conversion features consideration under ASC 815-15 “Derivatives and Hedging” and ASC 470-20 “Convertible Securities with Beneficial Conversion Features” and noted none. | |||||||||
Aggregate future maturities of notes payable at December 31, 2013 are as follows: | |||||||||
2014 | $ 45,060 | ||||||||
2015 | 46,811 | ||||||||
2016 | 46,811 | ||||||||
2017 | 46,811 | ||||||||
2018 | 133,057 | ||||||||
Thereafter | 31,815 | ||||||||
$350,365 | |||||||||
Note_E_Commitments_and_Conting
Note E - Commitments and Contingencies | 12 Months Ended | ||||
Dec. 31, 2013 | |||||
Notes | ' | ||||
Note E - Commitments and Contingencies | ' | ||||
NOTE E – COMMITMENTS AND CONTINGENCIES | |||||
COMMITMENTS | |||||
Operating Leases | |||||
The Company leases its executive office space under a non-cancelable operating lease, at an effective annual rental rate of $16.50 per square foot, which will expire December 31, 2019. Future minimum lease payments required at December 31, 2013 under non-cancelable operating leases that have initial lease terms exceeding one year are presented in the following table: | |||||
Year ending December 31 | |||||
2014 | $ 202,213 | ||||
2015 | 221,782 | ||||
2016 | 221,782 | ||||
2017 | 221,782 | ||||
2018 | 221,782 | ||||
Thereafter | 221,782 | ||||
$ 1,311,123 | |||||
Rental expense for all operating leases for the years ended December 31, 2013 and 2012 was approximately $278,275 and $271,675, respectively. | |||||
The Company’s long-term non-cancelable operating lease includes scheduled base rental increases over the term of the lease. The total amount of the base rental payments is charged to expense on the straight-line method over the term of the lease. | |||||
The Company had recorded a deferred credit of $19,568 at December 31, 2013, which is reflected in Accrued and Other Liabilities on the Balance Sheet to reflect the net excess of rental expense over cash payments since inception of the lease. In addition to the base rent payments the Company pays a monthly allocation of the building’s operating expenses. | |||||
CONTINGENCIES | |||||
As a provider of telecommunications, the Company is affected by regulatory proceedings in the ordinary course of its business at the state and federal levels. These include proceedings before both the Federal Communications Commission and the Oklahoma Corporation Commission (“OCC”). In addition, in its operations the Company relies on obtaining many of its underlying telecommunications services and/or facilities from incumbent local exchange carriers or other carriers pursuant to interconnection or other agreements or arrangements. In January 2007, the Company concluded a regulatory proceeding pursuant to the Federal Telecommunications Act of 1996 before the OCC relating to the terms of its interconnection agreement with Southwestern Bell Telephone, L.P. d/b/a AT&T, which succeeds a prior interconnection agreement. The OCC approved this agreement in May 2007. This agreement may be affected by regulatory proceedings at the federal and state levels, with possible adverse impacts on the Company. The Company is unable to accurately predict the outcomes of such regulatory proceedings at this time, but an unfavorable outcome could have a material adverse effect on the Company’s business, financial condition or results of operations. | |||||
Note_F_Income_Taxes
Note F - Income Taxes | 12 Months Ended | ||||||||
Dec. 31, 2013 | |||||||||
Notes | ' | ||||||||
Note F - Income Taxes | ' | ||||||||
NOTE F — INCOME TAXES | |||||||||
The Company uses the liability method, where deferred tax assets and liabilities are determined based on the expected future tax consequences of temporary differences between the carrying amounts of assets and liabilities for financial and income tax reporting purposes. | |||||||||
The Company has historically incurred losses from operations and therefore had no tax liability. The net deferred asset generated by the loss carry-forward has been fully reserved. The cumulative net operating loss carry-forward is approximately $2,689,176 and $2,572,344 for 2013 and 2012, respectively and will begin expiring in 2023. | |||||||||
Deferred tax assets consist of the tax effect of NOL carry-forwards. The Company has provided a full valuation allowance on the deferred tax assets because of the uncertainty regarding its realizability. Deferred tax assets consist of the following: | |||||||||
31-Dec-13 | 31-Dec-12 | ||||||||
Net operating loss carry-forwards | $ 914,320 | $ 874,597 | |||||||
Valuation allowance | (914,320) | (874,597) | |||||||
$ 0 | $ 0 |
Note_G_Common_Stock_and_Stockb
Note G - Common Stock and Stock-based Compensation | 12 Months Ended | |||||||||||||
Dec. 31, 2013 | ||||||||||||||
Notes | ' | |||||||||||||
Note G - Common Stock and Stock-based Compensation | ' | |||||||||||||
NOTE G — COMMON STOCK AND STOCK-BASED COMPENSATION | ||||||||||||||
COMMON STOCK | ||||||||||||||
Employee stock options for 140,000 shares of the Company’s common stock were exercised in March 2012 for $420. | ||||||||||||||
On June 3, 2013, holders of a majority of the outstanding common stock of the Company executed a Shareholder Consent to Action in Lieu of a Meeting and approved the amendment and restatement of the Company’s Articles of Incorporation to increase the number of authorized shares of the Company’s common stock from 10,000,000 to 40,000,000 shares, $.00001 par value per share. | ||||||||||||||
STOCK BASED COMPENSATION | ||||||||||||||
The Company does not have a written employee stock option plan. The Company has historically granted only employee stock options with an exercise price equal to the market price of the Company’s stock at the date of grant, a contractual term of ten years, and a vesting period of three years ratably on the first, second and third anniversaries of the date of grant (with limited exceptions). | ||||||||||||||
All employee stock options granted during 2013 and 2012 were nonqualified stock options. Stock-based compensation is measured at the grant date, based on the calculated fair value of the option, and is recognized as an expense on a straight-line basis over the requisite employee service period (generally the vesting period of the grant). | ||||||||||||||
The following table summarizes the Company’s employee stock option activity for the years ended December 31, 2013 and 2012: | ||||||||||||||
Schedule of Employee Stock Option Activity | ||||||||||||||
Weighted | ||||||||||||||
Weighted | average | Aggregate | ||||||||||||
average | remaining | intrinsic | ||||||||||||
Options | exercise price | contractual life (yrs) | value | |||||||||||
Options outstanding, December 31, 2011 | 1,462,783 | $0.04 | 2.89 | |||||||||||
Options exercisable, December 31, 2011 | 1,342,883 | $0.04 | 2.38 | $ 0 | ||||||||||
Options granted during the year | 341,000 | 0.003 | ||||||||||||
Options exercised during the year | (140,000) | 0.003 | ||||||||||||
Options forfeited during the year | (75,566) | 0.021 | ||||||||||||
Options expired during the year | (183,667) | 0.05 | ||||||||||||
Options outstanding, December 31, 2012 | 1,404,550 | $0.03 | 3.06 | |||||||||||
Options exercisable, December 31, 2012 | 1,249,550 | $0.04 | 2.27 | $ 4,920 | ||||||||||
Options granted during the year | 2,793,348 | 0.031 | ||||||||||||
Options cancelled during the year | -827,848 | 0.04 | ||||||||||||
Options forfeited during the year | -57,000 | 0.027 | ||||||||||||
Options expired during the year | -110,168 | 0.04 | ||||||||||||
Options outstanding, December 31, 2013 | 3,202,882 | $0.03 | 9.1 | |||||||||||
Options exercisable, December 31, 2013 | 1,755,882 | $0.03 | 8.75 | $ 42,261 | ||||||||||
The following table summarizes the Company’s non-vested employee stock option activity for years ended December 31, 2013 and 2012: | ||||||||||||||
2013 | 2012 | |||||||||||||
Non-vested options outstanding, beginning of year | 155,000 | 119,900 | ||||||||||||
Options granted during the year | 2,793,348 | 341,000 | ||||||||||||
Options vested during the year | -1,444,348 | (230,334) | ||||||||||||
Options forfeited during the year | (57,000) | (75,566) | ||||||||||||
Non-vested options outstanding, end of year | 1,447,000 | 155,000 | ||||||||||||
The fair values of the granted options are estimated at the date of grant using the Black-Scholes option pricing model. In addition to the exercise and grant date prices of the options, certain weighted average assumptions that were used to estimate the fair value of stock option grants in the respective periods are listed in the table below: | ||||||||||||||
2013 | 2012 | |||||||||||||
Risk free interest rate | .72% – 1.66% | 1.77% - 2.11% | ||||||||||||
Expected lives (in years) | 5 | 5 | ||||||||||||
Expected volatility | 186% - 243% | 173% - 187% | ||||||||||||
Dividend yield | 0% | 0% | ||||||||||||
The following table shows total stock-based compensation expense included in the Consolidated Statements of Operations and the effect on basic and diluted earnings per share for the years ended December 31: | ||||||||||||||
2013 | 2012 | |||||||||||||
Stock options compensation | $ 51,481 | $ 3,412 | ||||||||||||
Impact on income per share: | ||||||||||||||
Basic | $ - | $ - | ||||||||||||
Assuming dilution | $ - | $ - | ||||||||||||
During the year 2012, 140,000 employee stock options were granted which were fully vested at grant date and 198,000 employee stock options were granted which were one-third vested at grant date resulting in $111 and $117 of stock options compensation, respectively. Stock options compensation of $3,184 recorded in the year 2012 was related to options that vested in prior years. During the year 2012, 3,000 employee stock options were granted and forfeited in the same year. Additionally, 72,266 employee stock options were forfeited that were related to options granted in prior years. At December 31, 2012, there was $4,863 of unrecognized stock options compensation that is expected to be recognized as an expense over a weighted-average period of 5 years. Also during the year 2012, 183,667 employee stock options expired. | ||||||||||||||
During the year 2013, 827,848 employee stock options were granted which were fully vested at grant date and 1,911,500 employee stock options were granted which were one-third vested at grant date resulting in $16,448 and $30,608 of stock options compensation, respectively. Stock options compensation of $4,425 recorded in the year 2013 was related to options that vested in prior years. During the year 2013, 54,000 employee stock options were granted and forfeited in the same year. Additionally, 3,000 employee stock options were forfeited that related to options granted in prior years. At December 31, 2013 there was $37,308 of unrecognized stock options compensation that is expected to be recognized as an expense over a weighted-average period of 5.1 years. Also during the year 2013, 110,168 and 827,848 of employee stock options were expired and cancelled, respectively. | ||||||||||||||
Common Stock Purchase Warrants – A summary of common stock purchase warrant activity for the years ended December 31, 2013 and 2012 follows: | ||||||||||||||
In December 2012, the Company agreed to extend the expiration date on 140,000 of common stock purchase warrants with exercise prices of $.01and $.13 from December 1, 2012 to December 21, 2015 and adjusted the exercise prices to $.01 in return for a credit of $3,274 on the outstanding balance of an operating lease payable. The fair value of the common stock purchase warrants was measured at the date of modification using the Black-Scholes option pricing model. See below for the weighted average assumptions that were used to estimate the fair value of the modified warrants. | ||||||||||||||
Outstanding common stock purchase warrants issued to non-employees outstanding at December 31, 2013 are as follows: | ||||||||||||||
Number | Exercise | Expiration | ||||||||||||
of shares | price | year | ||||||||||||
140,000 | .010 | 2015 | ||||||||||||
425,000 | .003 | 2015 | ||||||||||||
250,000 | .003 | 2023 | ||||||||||||
815,000 | ||||||||||||||
Outstanding common stock purchase warrants issued to non-employees outstanding at December 31, 2012 are as follows: | ||||||||||||||
Number | Exercise | Expiration | ||||||||||||
of shares | price | year | ||||||||||||
140,000 | .010 | 2015 | ||||||||||||
425,000 | .003 | 2015 | ||||||||||||
565,000 | ||||||||||||||
The following table summarizes the Company’s common stock purchase warrant activity for the years ended December 31: | ||||||||||||||
Schedule of Common Stock Purchase Warrant and Non-employee Stock Option Activity | ||||||||||||||
2013 | Weighted Average Exercise Price | 2012 | Weighted Average Exercise Price | |||||||||||
Warrants and non-employee stock options outstanding, beginning of year | 565,000 | $ .005 | 591,000 | $ .0009 | ||||||||||
Warrants and non-employee stock options granted during the year | 250,000 | .003 | - | - | ||||||||||
Warrants and non-employee stock options expired during the year | - | - | (26,000) | .0910 | ||||||||||
Warrants and non-employee stock options outstanding, end of year | 815,000 | $ .004 | 565,000 | $ .0050 | ||||||||||
Of the 815,000 warrants and non-employee stock options outstanding at December 31, 2013, 550,000 were issued as equity compensation for consulting services and 265,000 were issued for interim financing. | ||||||||||||||
During the year ended December 31, 2013, 250,000 warrants were issued for consulting services. The fair value of the granted warrants are estimated at the date of grant using the Black-Scholes option pricing model and the total value of $6,182 of warrants expense was recognized for the year ended December 31, 2013. | ||||||||||||||
The Black-Scholes option pricing model was used with the following weighted-average assumptions for warrants granted during the years ended December 31, 2013 and 2012. | ||||||||||||||
2013 | 2012 | |||||||||||||
Risk free interest rate | 1.36% | .37% | ||||||||||||
Expected lives (in years) | 3 | 3 | ||||||||||||
Expected volatility | 243% | 187% | ||||||||||||
Dividend yield | 0% | 0% |
Note_H_Series_A_Convertible_Pr
Note H - Series A Convertible Preferred Stock | 12 Months Ended |
Dec. 31, 2013 | |
Notes | ' |
Note H - Series A Convertible Preferred Stock | ' |
NOTE H — SERIES A CONVERTIBLE PREFERRED STOCK | |
On June 3, 2013, pursuant to shareholder authorization, the Company issued 987,102 shares of its Series A convertible preferred stock and $401,004 was recognized as gain on Series A convertible preferred stock issued in exchange for indebtedness for the year ended December 31, 2013. See breakdown below: | |
The Company issued 59,634 and 203,169 of its series A convertible preferred stock to settle $55,000 of debt, $4,634 of accrued interest and $203,169 of accounts payable (see Note D – Convertible Notes Payable Related Party). As a result, the Company recognized a gain on settlement of debt and accrued interest of $57,248 and a gain on settlement of accounts payable of $195,042. | |
Members of the Company’s management and board of directors accounted for 609,507 shares of the shares issued in exchange for $609,507 and $46,626 of the Company’s deferred compensation and accrued payroll taxes. Participation of the Company’s management and board of directors in this exchange was approved by a majority of the Company’s shareholders. | |
Also, accounts payable of $114,792 was exchanged for 114,792 of series A convertible preferred stock. The Company recognized $110,200 as gain on settlement of accounts payable for the year ended December 31, 2013. An additional $38,514 of gain netted against $9,694 of professional fees was recognized as the Company wrote off additional accounts payables and deferred compensation due to the applicable Statute of Limitations. | |
The shares of Series A convertible preferred stock are convertible into common shares of the Company at the rate of one share of common stock per share of Series A convertible preferred stock. | |
The holders of shares of the Series A convertible preferred stock are entitled to receive, when and as declared by the Company’s board of directors, dividends in cash in the amount of one cent per share per annum through December 31, 2016, five cents per share per annum through December 31, 2017, six cents per share per annum through December 31, 2018, seven cents per share per annum through December 31, 2019, eight cents per share per annum through December 31, 2020, nine cents per share per annum through December 31, 2021, ten cents per share per annum through December 31, 2022, eleven cents per share per annum through December 31, 2023, and twelve cents per share per annum thereafter, payable within 90 days following the 31st day of December each year on such date as determined by the board of directors. The dividends are cumulative and beginning January 1, 2017, the board of directors of the Company may elect to make any required dividend payment with the Company’s unregistered common stock in lieu of cash. | |
Due to the unstated dividend cost arising from the gradually increasing dividends on the Series A convertible preferred stock, the Company calculated a discount on the Series A convertible preferred stock at the time of issuance as the present value of the difference between (i) the dividends that are payable in the periods preceding commencement of the perpetual twelve cents per share per annum dividend; and (ii) the perpetual twelve cents per share per annum dividend for a corresponding number of periods; discounted at a market rate of 12% totaling $309,337. The Series A convertible preferred stock was valued at the market price on the respective date of issuance for a total value of $672,472. The discount will be amortized over the periods preceding commencement of the perpetual dividend, by charging imputed dividend cost against retained earnings and increasing the carrying amount of the Series A convertible preferred stock by a corresponding amount. The discount amortization for the year ended December 31, 2013 was $67,247. | |
The Series A convertible preferred stock is non-voting except that in the event that the Company fails, for any reason, to make a dividend payment as set forth above, then each share of Series A convertible preferred stock shall thereafter be entitled to two votes upon any matter that the holders of the common stock of the Company are entitled to vote upon. | |
The Series A convertible preferred stock may be redeemed at the option of the Company’s board of directors for one dollar per share plus all accrued and unpaid dividends thereon at the date of redemption. In addition, at any time after a change of control of the Company, the holders of the Series A convertible preferred stock shall have the right, at the election of a majority of the holders, to require the Company to redeem all of the Series A convertible preferred stock for one dollar per share plus all accrued and unpaid dividends thereon at the date of redemption. | |
The Series A convertible preferred stock has a liquidation preference of one dollar per share plus all accrued and unpaid dividends thereon in the event of liquidation, dissolution or winding up of the Company. | |
The Company analyzed the embedded conversion option for derivative accounting consideration under ASC 815-15 “Derivatives and Hedging” and determined that the conversion option should be classified as equity. | |
The Company analyzed the conversion option for beneficial conversion features consideration under ASC 470-20 “Convertible Securities with Beneficial Conversion Features” and noted none. |
Note_I_Related_Party
Note I - Related Party | 12 Months Ended |
Dec. 31, 2013 | |
Notes | ' |
Note I - Related Party | ' |
NOTE I – RELATED PARTY | |
The Company had an operating lease for certain equipment which was leased from Generation Capital Associates, one of its shareholders whose parent company, High Capital Funding, LLC also one of our shareholders, holds a $225,189 secured convertible promissory note (see Note D - Convertible Notes Payable Related Party). On May 31, 2013, the Company issued a $50,000 secured convertible promissory note and on June 3, 2013, issued 203,169 shares of its Series A convertible preferred stock (see Note H – Series A Convertible Preferred Stock), in complete satisfaction of the balance due on the operating lease in the amount of $253,169. The Company recognized $195,042 as gain on settlement of accounts payable for the year ended December 31, 2013. | |
The Company had been unable to make all of the required payments pursuant to the terms of the September 2007 agreement. This secured convertible promissory note is secured by the equipment leased by the Company pursuant to the aforementioned operating lease. Upon payment of the balance due on this secured convertible promissory note title of the equipment will be transferred to the Company free and clear of all liens and encumbrances. | |
The note holder has the right to convert the note, in its entirety or in part, into common stock of the Company at the rate of $1.00 per share. |
Note_J_Concentrations
Note J - Concentrations | 12 Months Ended |
Dec. 31, 2013 | |
Notes | ' |
Note J - Concentrations | ' |
NOTE J – CONCENTRATIONS | |
During the year ended December 31, 2013, the Company had two customers that each comprised approximately 9% and 8% of total revenues, respectively. During the year ended December 31, 2012 these two customers each comprised approximately 11% and 9% of total revenues, respectively. |
Note_K_Subsequent_Event
Note K - Subsequent Event | 12 Months Ended |
Dec. 31, 2013 | |
Notes | ' |
Note K - Subsequent Event | ' |
NOTE K – SUBSEQUENT EVENT | |
In February 2014, the Company granted 3,000 employee stock options to one employee with an exercise price of $.05. The stock options shall vest one-third each year starting from February 11, 2015, and shall expire on February 11, 2024. |
Compensation_Related_Costs_Sha
Compensation Related Costs, Share Based Payments (USD $) | 12 Months Ended | ||
Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | |
Compensation Related Costs, Share Based Payments: | ' | ' | ' |
Share-based Compensation Arrangement by Share-based Payment Award, Non-Option Equity Instruments, Outstanding, Number | 815,000 | 565,000 | 591,000 |
Share-based Compensation Arrangement by Share-based Payment Award, Non-Option Equity Instruments, Granted | 250,000 | ' | ' |
Share-based Compensation Arrangement by Share-based Payment Award, Non-Option Equity Instruments, Expirations | ' | -26,000 | ' |
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Grants in Period, Weighted Average Grant Date Fair Value | $0.00 | ' | ' |
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Vested in Period, Weighted Average Grant Date Fair Value | $0.01 | ' | ' |
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Forfeitures, Weighted Average Grant Date Fair Value | $0.09 | ' | ' |
Note_A_Summary_of_Accounting_P1
Note A - Summary of Accounting Policies and Nature of Operations: Consolidation (Policies) | 12 Months Ended |
Dec. 31, 2013 | |
Policies | ' |
Consolidation | ' |
Consolidation | |
The consolidated financial statements include the accounts of FullNet Communications, Inc. and its wholly owned subsidiaries FullNet, Inc., FullTel, Inc., FullWeb, Inc., and CallMultiplier, Inc.. All material inter-company accounts and transactions have been eliminated. |
Note_A_Summary_of_Accounting_P2
Note A - Summary of Accounting Policies and Nature of Operations: Use of Estimates (Policies) | 12 Months Ended |
Dec. 31, 2013 | |
Policies | ' |
Use of Estimates | ' |
Use of Estimates | |
The preparation of financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect certain reported amounts and disclosures; accordingly, actual results could differ from those estimates. |
Note_A_Summary_of_Accounting_P3
Note A - Summary of Accounting Policies and Nature of Operations: Cash Equivalents (Policies) | 12 Months Ended |
Dec. 31, 2013 | |
Policies | ' |
Cash Equivalents | ' |
Cash Equivalents | |
Cash equivalents are represented by operating accounts or money market accounts maintained with insured financial institutions which consist of highly liquid investments that mature in three months or less from date of purchase. |
Note_A_Summary_of_Accounting_P4
Note A - Summary of Accounting Policies and Nature of Operations: Accounts Receivable (Policies) | 12 Months Ended | ||||
Dec. 31, 2013 | |||||
Policies | ' | ||||
Accounts Receivable | ' | ||||
Accounts Receivable | |||||
The Company operates and grants credit, on an uncollateralized basis. Concentrations of credit risk with respect to accounts receivable are limited due to the large number of customers comprising the Company’s customer base and their dispersion across different industries. | |||||
Accounts receivable, other than certain large customer accounts which are evaluated individually, are considered past due for purposes of determining the allowance for doubtful accounts based on past experience of collectability as follows: | |||||
1 – 29 days | 1.5 | % | |||
30 – 59 days | 30 | % | |||
60 – 89 days | 50 | % | |||
> 90 days | 100 | % | |||
In addition, if the Company becomes aware of a specific customer’s inability to meet its financial obligations, a specific reserve is recoded against amounts due to reduce the net recognized receivable to the amount reasonably expected to be collected. |
Note_A_Summary_of_Accounting_P5
Note A - Summary of Accounting Policies and Nature of Operations: Depreciation, Depletion, and Amortization (Policies) | 12 Months Ended | ||||||||
Dec. 31, 2013 | |||||||||
Policies | ' | ||||||||
Depreciation, Depletion, and Amortization | ' | ||||||||
Property and Equipment | |||||||||
Property and equipment are stated at cost. Depreciation is computed primarily using the straight-line method over the estimated useful lives of the related assets as follows: | |||||||||
Software | 3 years | ||||||||
Computers and equipment | 5 years | ||||||||
Furniture and fixtures | 7 years | ||||||||
Leasehold improvements | Shorter of estimated life of improvement or the lease term | ||||||||
Property and equipment consist of the following at December 31: | |||||||||
Schedule of Property and Equipment | |||||||||
2013 | 2012 | ||||||||
Computers and equipment | $ 1,536,744 | $ 1,527,170 | |||||||
Leasehold improvements | 994,152 | 991,750 | |||||||
Software | 57,337 | 57,337 | |||||||
Furniture and fixtures | 31,821 | 31,821 | |||||||
2,620,054 | 2,608,078 | ||||||||
Less accumulated depreciation | (2,575,419) | (2,552,242) | |||||||
$ 44,635 | $ 55,836 | ||||||||
Depreciation expense for the years ended December 31, 2013 and 2012 was $23,177 and $36,495, respectively. | |||||||||
Note_A_Summary_of_Accounting_P6
Note A - Summary of Accounting Policies and Nature of Operations: Long-lived Assets (Policies) | 12 Months Ended |
Dec. 31, 2013 | |
Policies | ' |
Long-lived Assets | ' |
Long-Lived Assets | |
All long-lived assets held and used by the Company, including intangible assets, are reviewed to determine whether any events or changes in circumstances indicate that the carrying amount of the asset may not be recoverable. . In accordance with ASC 360-10-35 “Impairment or Disposal of Long-lived Assets”, the Company bases its evaluation on such impairment indicators as the nature of the assets, the future economic benefit of the assets, any historical or future profitability measurements, as well as other external market conditions or factors that may be present. If such impairment indicators are present or other factors exist that indicate that the carrying amount of the asset may not be recoverable the Company determines whether impairment has occurred through the use of an undiscounted cash flows analysis of the asset. If impairment has occurred, the Company recognizes a loss for the difference between the carrying amount and the estimated value of the asset. | |
The Company incurred an impairment expense of $31,295 in 2012 and no impairment expense was incurred in 2013. Amortization expense for the years ended December 31, 2013 and 2012 was $5,910 and $3,125, respectively |
Note_A_Summary_of_Accounting_P7
Note A - Summary of Accounting Policies and Nature of Operations: Revenue Recognition, Deferred Revenue (Policies) | 12 Months Ended |
Dec. 31, 2013 | |
Policies | ' |
Revenue Recognition, Deferred Revenue | ' |
Revenue Recognition | |
Revenues are reported on a monthly basis as services are provided, price is fixed and determinable, persuasive evidence of an arrangement exists and collectability of the resulting receivable is reasonably assured.. Revenue that is received in advance of the services provided is deferred until the services are provided by the Company. Revenue related to set up charges is also deferred and amortized over the life of the contract. Revenues are presented net of taxes and fees billed to customers and remitted to governmental authorities. |
Note_A_Summary_of_Accounting_P8
Note A - Summary of Accounting Policies and Nature of Operations: Advertising Cost, Policy, Expenses Advertising Cost (Policies) | 12 Months Ended |
Dec. 31, 2013 | |
Policies | ' |
Advertising Cost, Policy, Expenses Advertising Cost | ' |
Advertising | |
The Company expenses advertising production costs as they are incurred and advertising communication costs the first time the advertising takes place. |
Note_A_Summary_of_Accounting_P9
Note A - Summary of Accounting Policies and Nature of Operations: Income Tax, Policy (Policies) | 12 Months Ended |
Dec. 31, 2013 | |
Policies | ' |
Income Tax, Policy | ' |
Income Taxes | |
The Company accounts for income taxes utilizing ASC 740, “Income Taxes” (SFAS No. 109). ASC 740 requires the measurement of deferred tax assets for deductible temporary differences and operating loss carry forwards, and of deferred tax liabilities for taxable temporary differences. Measurement of current and deferred tax liabilities and assets is based on provisions of enacted tax law. The effects of future changes in tax laws or rates are not included in the measurement. The Company recognizes the amount of taxes payable or refundable for the current year and recognizes deferred tax liabilities and assets for the expected future tax consequences of events and transactions that have been recognized in the Company’s financial statements or tax returns. The Company currently has substantial net operating loss carry forwards. The Company has recorded a 100% valuation allowance against net deferred tax assets due to uncertainty of their ultimate realization. Valuation allowances are established when necessary to reduce deferred tax assets to the amount expected to be realized. | |
The Company recognizes interest and penalties related to unrecognized tax benefits in income tax expense and does not believe it has any material unrealized tax benefits at December 31, 2013. The Company files income tax returns in the U.S. federal jurisdiction and various state and local jurisdictions. |
Recovered_Sheet1
Note A - Summary of Accounting Policies and Nature of Operations: Income Per Share (Policies) | 12 Months Ended |
Dec. 31, 2013 | |
Policies | ' |
Income Per Share | ' |
Income Per Share | |
Income (loss) per share – basic is calculated by dividing net income by the weighted average number of shares of stock outstanding during the year, including shares issuable without additional consideration. Income per share – assuming dilution is calculated by dividing net income by the weighted average number of shares outstanding during the year adjusted for the effect of dilutive potential shares calculated using the treasury stock method. |
Recovered_Sheet2
Note A - Summary of Accounting Policies and Nature of Operations: Share-based Compensation, Option and Incentive Plans Policy (Policies) | 12 Months Ended |
Dec. 31, 2013 | |
Policies | ' |
Share-based Compensation, Option and Incentive Plans Policy | ' |
Stock-Based Compensation | |
The Company does not have a written employee stock option plan. The Company has historically granted only employee stock options with an exercise price equal to the market price of the Company’s stock at the date of grant, a contractual term of ten years, and a vesting period of three years ratably on the first, second and third anniversaries of the date of grant (with limited exceptions). | |
All employee stock options granted during 2013 and 2012 were nonqualified stock options. Stock-based compensation is measured at the grant date, based on the calculated fair value of the option, and is recognized as an expense on a straight-line basis over the requisite employee service period (generally the vesting period of the grant). | |
The fair values of the granted options are estimated at the date of grant using the Black-Scholes option pricing model. See Note G – Common Stock and Stock-Based Compensation for further information on stock-based compensation. |
Recovered_Sheet3
Note A - Summary of Accounting Policies and Nature of Operations: Fair Value Measurements (Policies) | 12 Months Ended |
Dec. 31, 2013 | |
Policies | ' |
Fair Value Measurements | ' |
Fair Value Measurements | |
The Company measures its financial assets and liabilities in accordance with the requirements of FASB ASC 820, “Fair Value Measurements and Disclosures”. ASC 820 clarifies the definition of fair value, prescribes methods for measuring fair value, and establishes a fair value hierarchy to classify the inputs used in measuring fair value as follows: | |
Level 1 – Quoted prices are available in active markets for identical assets or liabilities as of the reporting date. Active markets are those in which transactions for the asset or liability occur in sufficient frequency and volume to provide pricing information on an ongoing basis. Level 1 primarily consists of financial instruments such as exchange-traded derivatives, marketable securities and listed equities. | |
Level 2 - Pricing inputs are other than quoted prices in active markets included in level 1, which are either directly or indirectly observable as of the reported date and includes those financial instruments that are valued using models or other valuation methodologies. These models are primarily industry-standard models that consider various assumptions, including quoted forward prices for commodities, time value, volatility factors, and current market and contractual prices for the underlying instruments, as well as other relevant economic measures. Substantially all of these assumptions are observable in the marketplace throughout the full term of the instrument, can be derived from observable data or are supported by observable levels at which transactions are executed in the marketplace. Instruments in this category generally include non-exchange-traded derivatives such as commodity swaps, interest rate swaps, options and collars. | |
Level 3 – Pricing inputs include significant inputs that are generally less observable from objective sources. These inputs may be used with internally developed methodologies that result in management’s best estimate of fair value. |
Recovered_Sheet4
Note A - Summary of Accounting Policies and Nature of Operations: New Accounting Pronouncements, Policy (Policies) | 12 Months Ended |
Dec. 31, 2013 | |
Policies | ' |
New Accounting Pronouncements, Policy | ' |
Recent Accounting Pronouncements | |
There have been no recent accounting pronouncements that would impact our financial statements. | |
Note_B_Going_Concern_Basis_of_
Note B - Going Concern: Basis of Accounting, Policy (Policies) | 12 Months Ended |
Dec. 31, 2013 | |
Policies | ' |
Basis of Accounting, Policy | ' |
The accompanying financial statements have been prepared in conformity with generally accepted accounting principles |
Note_B_Going_Concern_Going_Con
Note B - Going Concern: Going Concern (Policies) | 12 Months Ended |
Dec. 31, 2013 | |
Policies | ' |
Going Concern | ' |
However, the Company has sustained substantial net losses. At December 31, 2013 and 2012 current liabilities exceeded current assets by $828,689 and $2,029,431, respectively. These factors raise substantial doubt about the Company’s ability to continue as a going concern. | |
In view of the matters described in the preceding paragraph, the ability of the Company to continue as a going concern is dependent upon continued operations of the Company that in turn is dependent upon the Company’s ability to meet its financing requirements on a continuing basis, to maintain present financing, to achieve the objectives of its business plan and to succeed in its future operations. The financial statements do not include any adjustments relating to the recoverability and classification of recorded asset amounts or amounts and classification of liabilities that might be necessary should the Company be unable to continue in existence. | |
The Company’s business plan includes, among other things, expansion through mergers and acquisitions and the development of its web hosting, co-location, traditional telephone services and advanced voice and data solutions. Execution of the Company’s business plan will require significant capital to fund capital expenditures, working capital needs and debt service. Current cash balances will not be sufficient to fund the Company’s current business plan beyond the next few months. As a consequence, the Company is currently focusing on revenue enhancement and cost cutting opportunities as well as working to sell non-core assets and to extend vendor payment terms. The Company continues to seek additional convertible debt or equity financing as well as the placement of a credit facility to fund the Company’s liquidity. There can be no assurance that the Company will be able to obtain additional capital on satisfactory terms, or at all, or on terms that will not dilute the shareholders’ interests. |
Note_E_Commitments_and_Conting1
Note E - Commitments and Contingencies: Lease, Policy (Policies) | 12 Months Ended |
Dec. 31, 2013 | |
Policies | ' |
Lease, Policy | ' |
The Company’s long-term non-cancelable operating lease includes scheduled base rental increases over the term of the lease. The total amount of the base rental payments is charged to expense on the straight-line method over the term of the lease. |
Recovered_Sheet5
Note A - Summary of Accounting Policies and Nature of Operations: Schedule of Accounts Receivable (Tables) | 12 Months Ended | ||||||
Dec. 31, 2013 | |||||||
Tables/Schedules | ' | ||||||
Schedule of Accounts Receivable | ' | ||||||
Schedule of Accounts Receivable | |||||||
2013 | 2012 | ||||||
Accounts receivable | $ 261,510 | $ 252,636 | |||||
Less allowance for doubtful accounts | (243,970) | (236,965) | |||||
$ 17,540 | $ 15,671 |
Recovered_Sheet6
Note A - Summary of Accounting Policies and Nature of Operations: Schedule of Property and Equipment (Tables) | 12 Months Ended | ||||||||
Dec. 31, 2013 | |||||||||
Tables/Schedules | ' | ||||||||
Schedule of Property and Equipment | ' | ||||||||
Schedule of Property and Equipment | |||||||||
2013 | 2012 | ||||||||
Computers and equipment | $ 1,536,744 | $ 1,527,170 | |||||||
Leasehold improvements | 994,152 | 991,750 | |||||||
Software | 57,337 | 57,337 | |||||||
Furniture and fixtures | 31,821 | 31,821 | |||||||
2,620,054 | 2,608,078 | ||||||||
Less accumulated depreciation | (2,575,419) | (2,552,242) | |||||||
$ 44,635 | $ 55,836 |
Recovered_Sheet7
Note A - Summary of Accounting Policies and Nature of Operations: Computation of Basic and Diluted Income (Loss) Per Share (Tables) | 12 Months Ended | ||||||||
Dec. 31, 2013 | |||||||||
Tables/Schedules | ' | ||||||||
Computation of Basic and Diluted Income (Loss) Per Share | ' | ||||||||
Schedule of Income (Loss) Per Share | |||||||||
2013 | 2012 | ||||||||
Numerator: | |||||||||
Net income (loss) available to common shareholders | $ 156,120 | $ (223,098) | |||||||
Denominator: | |||||||||
Weighted average shares and share equivalents outstanding – basic | 9,118,161 | 9,087,942 | |||||||
Effect of dilutive preferred stock | 987,102 | - | |||||||
Effect of dilutive stock options | 871,361 | - | |||||||
Effect of dilutive warrants | 721,445 | - | |||||||
Weighted average shares and share equivalents outstanding – assuming dilution | 11,698,069 | 9,087,942 | |||||||
Net income (loss) per share — basic | $ .02 | $ (.02) | |||||||
Net income (loss) per share — assuming dilution | $ .01 | $ (.02) | |||||||
Anti-dilutive securities excluded (1) | 1,885,389 | - | |||||||
Note_C_Restatement_Restatement
Note C - Restatement: Restatement to Prior Year (Tables) | 12 Months Ended | |||||||
Dec. 31, 2013 | ||||||||
Tables/Schedules | ' | |||||||
Restatement to Prior Year | ' | |||||||
The restatements to balance sheet accounts as of December 31, 2012 are as follows: | ||||||||
As of December 31, 2012 | ||||||||
As Reported | Adjustments | As Restated | ||||||
CURRENT ASSETS | ||||||||
Cash | $ 10,847 | $ - | $ 10,847 | |||||
Accounts receivable, net | 44,311 | (28,640) | -1 | 15,671 | ||||
Prepaid expenses and other current assets | 6,403 | - | 6,403 | |||||
Total current assets | 61,561 | (28,640) | 32,921 | |||||
PROPERTY AND EQUIPMENT, net | 61,299 | (5,463) | -2 | 55,836 | ||||
OTHER ASSETS AND INTANGIBLE ASSETS | 5,250 | 11,608 | -1 | 16,858 | ||||
TOTAL ASSETS | $ 128,110 | $ (22,495) | $ 105,615 | |||||
CURRENT LIABILITIES | ||||||||
Accounts payable | $ 482,286 | $ - | $ 482,286 | |||||
Accrued and other liabilities, current portion | 281,808 | 795,215 | -3 | 1,077,023 | ||||
Convertible notes payable, related party - current portion | 304,206 | - | 304,206 | |||||
Deferred revenue | 198,837 | - | 198,837 | |||||
Total current liabilities | 1,267,137 | 795,215 | 2,062,352 | |||||
ACCRUED AND OTHER LIABILITIES, less current portion | 784,225 | (784,225) | -3 | - | ||||
Total liabilities | 2,051,362 | 10,990 | 2,062,352 | |||||
STOCKHOLDERS’ DEFICIT | ||||||||
Common stock | 91 | - | 91 | |||||
Additional paid-in capital | 8,417,050 | - | 8,417,050 | |||||
Accumulated deficit | (10,340,393) | (33,485) | -10,373,878 | |||||
Total stockholders’ deficit | (1,923,252) | (33,485) | (1,956,737) | |||||
TOTAL LIABILITIES AND STOCKHOLDERS’ DEFICIT | $ 128,110 | $ (22,495) | $ 105,615 | |||||
—————————— | ||||||||
(1) To correct an error in the recording of certain assets which were mistakenly recorded as accounts receivable instead of intangible assets. | ||||||||
(2) To correct an error in the calculation of depreciation expense. | ||||||||
(3) Reclassifications to conform to the presentation of the current period. | ||||||||
The restatements to income statement accounts for the year ended December 31, 2012 are as follows: | ||||||||
Year ended December 31, 2012 | ||||||||
As Reported | Adjustments | |||||||
As Restated | ||||||||
REVENUES | ||||||||
Access service revenues | $ 159,692 | $ - | $ 159,692 | |||||
Co-location and other revenues | 1,434,540 | - | 1,434,540 | |||||
Total revenues | 1,594,232 | - | 1,594,232 | |||||
OPERATING COSTS AND EXPENSES | ||||||||
Cost of access service revenues | 135,051 | (9,090) | -3 | 125,961 | ||||
Cost of co-location and other revenues | 348,133 | 9.090 | -3 | 357,223 | ||||
Selling, general and administrative expenses | 1,246,363 | (5,736) | -1 | 1,240,627 | ||||
Depreciation and amortization | 31,694 | 7,926 | -2 | 39,620 | ||||
Impairment expense | - | 31,295 | -1 | 31,295 | ||||
Total operating costs and expenses | 1,761,241 | 33,485 | 1,794,726 | |||||
LOSS FROM OPERATIONS | (167,009) | (33,485) | (200,494) | |||||
INTEREST EXPENSE | (22,604) | - | (22,604) | |||||
LOSS before income taxes | (189,613) | (33,485) | (223,098) | |||||
NET LOSS | $ (189,613) | $ (33,485) | $ (223,098) | |||||
Note_D_Convertible_Notes_Payab1
Note D - Convertible Notes Payable Related Party: Schedule of Notes Payable (Tables) | 12 Months Ended | ||||||||
Dec. 31, 2013 | |||||||||
Tables/Schedules | ' | ||||||||
Schedule of Notes Payable | ' | ||||||||
Notes payable consist of the following: | |||||||||
Schedule of Notes Payable | |||||||||
31-Dec-13 | 31-Dec-12 | ||||||||
Convertible promissory note; interest at 12.5% of face amount, payable quarterly; this note is unsecured and matured in November 2003 (convertible into approximately 107,843 shares at December 31, 2012) (1) | $ - | $ 55,000 | |||||||
Secured promissory note from a shareholder; interest at 6%, required monthly installments of interest only through December 30, 2010, then required monthly installments of $3,301 including principal and interest; matured December 30, 2011; secured by all tangible and intangible assets of the Company (2) | - | 249,206 | |||||||
Secured convertible promissory note from a shareholder; interest rate of 6% through December 31, 2014, 7% through December 31, 2015, 8% through December 31, 2016, 8.5% through December 31, 2017, and 9% through May 31, 2018, with fixed monthly payments of $3,301 through the Maturity Date, at which time the remaining balance of principal and all accrued interest shall be due and payable; matures May 31, 2018; secured by all tangible and intangible assets of the Company (2)(3) | 225,189 | - | |||||||
Secured convertible promissory note; interest at 6%, requires monthly installments of interest only through May 31, 2014, then requires monthly installments of $600 including principal and interest; matures May 31, 2023; secured by certain equipment of the Company (4) | 50,000 | - | |||||||
275,189 | 304,206 | ||||||||
Less current portion | 45,060 | 304,206 | |||||||
Convertible notes payable, related party - less current portion | $ 230,129 | $ - | |||||||
—————————— | |||||||||
(1) This convertible promissory note matured in November 2003. On June 3, 2013, the Company issued 59,634 shares of its Series A Convertible Preferred Stock, in complete satisfaction of the outstanding principal and accrued interest due on this note of $59,634 and $57,248 was recognized as gain on settlement of debt for the year ended December 31, 2013 (see Note H – Series A Convertible Preferred Stock). | |||||||||
(2) This secured promissory note matured on December 30, 2011. During the year of 2012, the Company continued to make principal and interest payments of $23,872 and $15,739, respectively. During the year of 2013, the Company continued to make principal and interest payments of $9,702 and $6,801, respectively. At May 31, 2013, the outstanding principal and accrued interest of the secured promissory note was $239,504. | |||||||||
(3) On May 31, 2013, the Company issued this secured convertible promissory note in exchange for the existing secured promissory note with a balance due, including accrued interest, of $239,504, which had matured on December 30, 2011. The secured convertible promissory note extended the maturity date to May 31, 2018 and increased the interest rate as noted above. The note holder has the right to convert the note, in its entirety or in part, into common stock of the Company at the rate of $1.00 per share. During the year 2013, the Company made principal payments of $14,315. The secured convertible promissory note had a balance of $225,189 at December 31, 2013. | |||||||||
The Company analyzed the modification of the term under ASC 470-60 “Trouble Debt Restructurings” and ASC 470-50 “Extinguishment of Debt”. The Company determined the creditor has not granted a concession and the modification of the embedded conversion options does not fall in the scope of ASC 470-50. | |||||||||
The Company analyzed the conversion option for derivative accounting and beneficial conversion features consideration under ASC 815-15 “Derivatives and Hedging” and ASC 470-20 “Convertible Securities with Beneficial Conversion Features” and noted none. | |||||||||
(4) On May 31, 2013, the Company issued this secured convertible promissory note and on June 3, 2013, issued 203,169 shares of its Series A convertible preferred stock, in complete satisfaction of the balance due in the amount of $253,169 on an operating lease for certain equipment which was leased from one of its shareholders whose parent company holds a $225,189 secured convertible promissory note. The Company recognized $195,042 as gain on settlement of accounts payable for the year ended December 31, 2013 (see Note H – Series A Convertible Preferred Stock). | |||||||||
The Company had been unable to make all of the required payments pursuant to the terms of the September 2007 agreement. This secured convertible promissory note is secured by the equipment leased by the Company pursuant to the aforementioned operating lease. Upon payment of the balance due on this secured convertible promissory note title of the equipment will be transferred to the Company free and clear of all liens and encumbrances. | |||||||||
The note holder has the right to convert the note, in its entirety or in part, into common stock of the Company at the rate of $1.00 per share. | |||||||||
The Company analyzed the conversion option for derivative accounting and beneficial conversion features consideration under ASC 815-15 “Derivatives and Hedging” and ASC 470-20 “Convertible Securities with Beneficial Conversion Features” and noted none. | |||||||||
Aggregate future maturities of notes payable at December 31, 2013 are as follows: | |||||||||
2014 | $ 45,060 | ||||||||
2015 | 46,811 | ||||||||
2016 | 46,811 | ||||||||
2017 | 46,811 | ||||||||
2018 | 133,057 | ||||||||
Thereafter | 31,815 | ||||||||
$350,365 | |||||||||
Note_E_Commitments_and_Conting2
Note E - Commitments and Contingencies: Schedule of Future Minimum Payments Under Operating Lease (Tables) | 12 Months Ended | ||||
Dec. 31, 2013 | |||||
Tables/Schedules | ' | ||||
Schedule of Future Minimum Payments Under Operating Lease | ' | ||||
Year ending December 31 | |||||
2014 | $ 202,213 | ||||
2015 | 221,782 | ||||
2016 | 221,782 | ||||
2017 | 221,782 | ||||
2018 | 221,782 | ||||
Thereafter | 221,782 | ||||
$ 1,311,123 |
Note_F_Income_Taxes_Schedule_o
Note F - Income Taxes: Schedule of Deferred Tax Assets and Liabilities (Tables) | 12 Months Ended | ||||||||
Dec. 31, 2013 | |||||||||
Tables/Schedules | ' | ||||||||
Schedule of Deferred Tax Assets and Liabilities | ' | ||||||||
31-Dec-13 | 31-Dec-12 | ||||||||
Net operating loss carry-forwards | $ 914,320 | $ 874,597 | |||||||
Valuation allowance | (914,320) | (874,597) | |||||||
$ 0 | $ 0 |
Note_G_Common_Stock_and_Stockb1
Note G - Common Stock and Stock-based Compensation: Schedule of Employee Stock Option Activity (Tables) | 12 Months Ended | |||||||||||||
Dec. 31, 2013 | ||||||||||||||
Tables/Schedules | ' | |||||||||||||
Schedule of Employee Stock Option Activity | ' | |||||||||||||
Schedule of Employee Stock Option Activity | ||||||||||||||
Weighted | ||||||||||||||
Weighted | average | Aggregate | ||||||||||||
average | remaining | intrinsic | ||||||||||||
Options | exercise price | contractual life (yrs) | value | |||||||||||
Options outstanding, December 31, 2011 | 1,462,783 | $0.04 | 2.89 | |||||||||||
Options exercisable, December 31, 2011 | 1,342,883 | $0.04 | 2.38 | $ 0 | ||||||||||
Options granted during the year | 341,000 | 0.003 | ||||||||||||
Options exercised during the year | (140,000) | 0.003 | ||||||||||||
Options forfeited during the year | (75,566) | 0.021 | ||||||||||||
Options expired during the year | (183,667) | 0.05 | ||||||||||||
Options outstanding, December 31, 2012 | 1,404,550 | $0.03 | 3.06 | |||||||||||
Options exercisable, December 31, 2012 | 1,249,550 | $0.04 | 2.27 | $ 4,920 | ||||||||||
Options granted during the year | 2,793,348 | 0.031 | ||||||||||||
Options cancelled during the year | -827,848 | 0.04 | ||||||||||||
Options forfeited during the year | -57,000 | 0.027 | ||||||||||||
Options expired during the year | -110,168 | 0.04 | ||||||||||||
Options outstanding, December 31, 2013 | 3,202,882 | $0.03 | 9.1 | |||||||||||
Options exercisable, December 31, 2013 | 1,755,882 | $0.03 | 8.75 | $ 42,261 |
Note_G_Common_Stock_and_Stockb2
Note G - Common Stock and Stock-based Compensation: Schedule of Changes in Non-Vested Options (Tables) | 12 Months Ended | ||||||
Dec. 31, 2013 | |||||||
Tables/Schedules | ' | ||||||
Schedule of Changes in Non-Vested Options | ' | ||||||
2013 | 2012 | ||||||
Non-vested options outstanding, beginning of year | 155,000 | 119,900 | |||||
Options granted during the year | 2,793,348 | 341,000 | |||||
Options vested during the year | -1,444,348 | (230,334) | |||||
Options forfeited during the year | (57,000) | (75,566) | |||||
Non-vested options outstanding, end of year | 1,447,000 | 155,000 |
Note_G_Common_Stock_and_Stockb3
Note G - Common Stock and Stock-based Compensation: Summary of Weighted-Average Assumptions of Fair Value Granted Using Black-Scholes Valuation Method (Tables) | 12 Months Ended | ||||||||
Dec. 31, 2013 | |||||||||
Tables/Schedules | ' | ||||||||
Summary of Weighted-Average Assumptions of Fair Value Granted Using Black-Scholes Valuation Method | ' | ||||||||
2013 | 2012 | ||||||||
Risk free interest rate | .72% – 1.66% | 1.77% - 2.11% | |||||||
Expected lives (in years) | 5 | 5 | |||||||
Expected volatility | 186% - 243% | 173% - 187% | |||||||
Dividend yield | 0% | 0% |
Note_G_Common_Stock_and_Stockb4
Note G - Common Stock and Stock-based Compensation: Schedule of Stock-Based Compensation Expense (Tables) | 12 Months Ended | ||||||||
Dec. 31, 2013 | |||||||||
Tables/Schedules | ' | ||||||||
Schedule of Stock-Based Compensation Expense | ' | ||||||||
2013 | 2012 | ||||||||
Stock options compensation | $ 51,481 | $ 3,412 | |||||||
Impact on income per share: | |||||||||
Basic | $ - | $ - | |||||||
Assuming dilution | $ - | $ - |
Recovered_Sheet8
Note A - Summary of Accounting Policies and Nature of Operations: Schedule of Accounts Receivable (Details) (USD $) | Dec. 31, 2013 | Dec. 31, 2012 |
Details | ' | ' |
Accounts Receivable, Gross, Current | $261,510 | $252,636 |
Allowance for Doubtful Accounts Receivable, Current | -243,970 | -236,965 |
Accounts Receivable, Net, Current | $17,540 | $15,671 |
Recovered_Sheet9
Note A - Summary of Accounting Policies and Nature of Operations: Schedule of Property and Equipment (Details) (USD $) | Dec. 31, 2013 | Dec. 31, 2012 | ||
Details | ' | ' | ||
Fixtures and Equipment, Gross | $1,536,744 | [1] | $1,527,170 | [1] |
Leasehold Improvements, Gross | 994,152 | [2] | 991,750 | [2] |
Capitalized Computer Software, Gross | 57,337 | [3] | 57,337 | [3] |
Furniture and Fixtures, Gross | 31,821 | [4] | 31,821 | [4] |
Property, Plant and Equipment, Gross | 2,620,054 | 2,608,078 | ||
Accumulated Depreciation, Depletion and Amortization, Property, Plant, and Equipment | -2,575,419 | -2,552,242 | ||
PROPERTY AND EQUIPMENT, net | $44,635 | $55,836 | ||
[1] | Estimated Useful Life 5 Years | |||
[2] | Estimated Useful Life Lease Term | |||
[3] | Estimated Useful Life 3 years | |||
[4] | Estimated Useful Life 7 Years |
Recovered_Sheet10
Note A - Summary of Accounting Policies and Nature of Operations (Details) (USD $) | 12 Months Ended | |
Dec. 31, 2013 | Dec. 31, 2012 | |
Details | ' | ' |
Depreciation | $23,177 | $36,495 |
Advertising Expense | $61,753 | $51,632 |
Recovered_Sheet11
Note A - Summary of Accounting Policies and Nature of Operations: Long-lived Assets (Details) (USD $) | 12 Months Ended | |
Dec. 31, 2013 | Dec. 31, 2012 | |
Details | ' | ' |
Impairment of Goodwill | ' | $31,295 |
Amortization | $5,910 | $3,125 |
Recovered_Sheet12
Note A - Summary of Accounting Policies and Nature of Operations: Computation of Basic and Diluted Income (Loss) Per Share (Details) (USD $) | 12 Months Ended | |
Dec. 31, 2013 | Dec. 31, 2012 | |
Details | ' | ' |
Net income (loss) available to common stockholders | $156,120 | ($223,098) |
Weighted Average Number of Shares Issued, Basic | 9,118,161 | 9,087,942 |
Incremental Common Shares Attributable to Dilutive Effect of Conversion of Preferred Stock | 987,102 | ' |
Incremental Common Shares Attributable to Dilutive Effect of Share-based Payment Arrangements | 871,361 | ' |
Incremental Common Shares Attributable to Dilutive Effect of Call Options and Warrants | 721,445 | ' |
Weighted average shares outstanding - assuming dilution | 11,698,069 | 9,087,942 |
Net income (loss) per common share -basic | $0.02 | ($0.02) |
Net income (loss) per common share - assuming dilution | $0.01 | ($0.02) |
Antidilutive Securities Excluded from Computation of Earnings Per Share, Amount | 1,885,389 | ' |
Note_D_Convertible_Notes_Payab2
Note D - Convertible Notes Payable Related Party: Schedule of Notes Payable (Details) (USD $) | Dec. 31, 2013 | Dec. 31, 2012 | ||
Notes Payable, Related Parties | $225,189 | [1],[2] | ' | |
Notes Payable | 50,000 | [2],[3] | ' | |
Notes Payable, Current | 45,060 | 304,206 | ||
Notes Payable, Noncurrent | 230,129 | ' | ||
Convertible Debt | ' | ' | ||
Convertible Notes Payable | ' | 55,000 | [4] | |
Secured Debt | ' | ' | ||
Other Notes Payable | ' | $249,206 | [3] | |
[1] | Interest rate 6% through December 31, 2014, 7% through December 31, 2015, 8% through December 31, 2016, 8.5% through December 31, 2017 and 9% through May 31, 2018 | |||
[2] | Convertible into common stock of the Company at the rate of $1.00 per share | |||
[3] | Interest rate 6% | |||
[4] | Interest rate 12.5% |
Note_D_Convertible_Notes_Payab3
Note D - Convertible Notes Payable Related Party: Schedule of Maturities of Long-term Debt (Details) (USD $) | Dec. 31, 2013 |
Details | ' |
Long-term Debt, Maturities, Repayments of Principal in Next Rolling Twelve Months | $45,060 |
Long-term Debt and Capital Lease Obligations, Maturities, Repayments of Principal in Year Two | 46,811 |
Long-term Debt and Capital Lease Obligations, Maturities, Repayments of Principal in Year Three | 46,811 |
Long-term Debt and Capital Lease Obligations, Maturities, Repayments of Principal in Year Four | 46,811 |
Long-term Debt and Capital Lease Obligations, Maturities, Repayments of Principal in Year Five | 133,057 |
Long-term Debt and Capital Lease Obligations, Maturities, Repayments of Principal after Year Five | $31,815 |
Note_E_Commitments_and_Conting3
Note E - Commitments and Contingencies: Schedule of Future Minimum Payments Under Operating Lease (Details) (USD $) | Dec. 31, 2013 |
Details | ' |
Operating Leases, Future Minimum Payments Due, Next Twelve Months | $202,213 |
Operating Leases, Future Minimum Payments, Due in Two Years | 221,782 |
Operating Leases, Future Minimum Payments, Due in Three Years | 221,782 |
Operating Leases, Future Minimum Payments, Due in Four Years | 221,782 |
Operating Leases, Future Minimum Payments, Due in Five Years | 221,782 |
Operating Leases, Future Minimum Payments, Due Thereafter | 221,782 |
Operating Leases, Future Minimum Payments Due | $1,311,123 |
Note_E_Commitments_and_Conting4
Note E - Commitments and Contingencies (Details) (USD $) | 12 Months Ended | |
Dec. 31, 2013 | Dec. 31, 2012 | |
Details | ' | ' |
Operating Leases, Rent Expense | $278,275 | $271,675 |
Deferred Rent Credit | $19,568 | ' |
Note_F_Income_Taxes_Details
Note F - Income Taxes (Details) (USD $) | Dec. 31, 2013 | Dec. 31, 2012 |
Details | ' | ' |
Unrecognized Tax Benefits Resulting in Net Operating Loss Carryforward | $2,689,176 | $2,572,344 |
Note_F_Income_Taxes_Schedule_o1
Note F - Income Taxes: Schedule of Deferred Tax Assets and Liabilities (Details) (USD $) | Dec. 31, 2013 | Dec. 31, 2012 |
Details | ' | ' |
Deferred Tax Assets, Operating Loss Carryforwards | $914,320 | $874,597 |
Deferred Tax Assets, Valuation Allowance | ($914,320) | ($874,597) |
Note_G_Common_Stock_and_Stockb5
Note G - Common Stock and Stock-based Compensation: Schedule of Changes in Non-Vested Options (Details) | 1 Months Ended | 12 Months Ended | ||
Feb. 28, 2014 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | |
Details | ' | ' | ' | ' |
Share-based Compensation Arrangement by Share-based Payment Award, Options, Nonvested, Number of Shares | ' | 1,447,000 | 155,000 | 119,900 |
Share-based Compensation Arrangement by Share-based Payment Award, Options, Grants in Period, Gross | 3,000 | 2,793,348 | 341,000 | ' |
Share-based Compensation Arrangement by Share-based Payment Award, Options, Vested, Number of Shares | ' | -1,444,348 | -230,334 | ' |
Share-based Compensation Arrangement by Share-based Payment Award, Options, Nonvested Options Forfeited, Number of Shares | ' | -57,000 | -75,566 | ' |
Note_G_Common_Stock_and_Stockb6
Note G - Common Stock and Stock-based Compensation: Summary of Weighted-Average Assumptions of Fair Value Granted Using Black-Scholes Valuation Method (Details) (Stock Options) | 12 Months Ended | |
Dec. 31, 2013 | Dec. 31, 2012 | |
Stock Options | ' | ' |
Fair Value Assumptions, Risk Free Interest Rate | 1.36% | 0.37% |
Fair Value Assumptions, Expected Term | '3 years | '3 years |
Fair Value Assumptions, Expected Volatility Rate | 243.00% | 187.00% |
Fair Value Assumptions, Expected Dividend Rate | 0.00% | 0.00% |
Note_G_Common_Stock_and_Stockb7
Note G - Common Stock and Stock-based Compensation: Schedule of Stock-Based Compensation Expense (Details) (Stock Options, USD $) | 12 Months Ended | |
Dec. 31, 2013 | Dec. 31, 2012 | |
Stock Options | ' | ' |
Allocated Share-based Compensation Expense | $51,481 | $3,412 |
Note_H_Series_A_Convertible_Pr1
Note H - Series A Convertible Preferred Stock (Details) (USD $) | 12 Months Ended | ||
Dec. 31, 2013 | Dec. 31, 2012 | Jun. 03, 2013 | |
Details | ' | ' | ' |
Preferred stock issued, shares | 987,102 | ' | 987,102 |
GAIN ON SERIES A CONVERTIBLE PREFERRED STOCK ISSUED IN EXCHANGE FOR INDEBTEDNESS | $401,004 | $0 | ' |
Convertible Preferred Stock Shares Issued In Exchange For Debt And Accrued Interest | 59,634 | ' | ' |
Convertible Preferred Stock Shares Issued In Exchange For Related Party Accounts Payable | 203,169 | ' | ' |
Debt Exhanged For Convertible Preferred Stock | 55,000 | ' | ' |
Accrued Interest Exhanged For Convertible Preferred Stock | 4,634 | ' | ' |
Related Party Accounts Payable Exchanged For Convertible Preferred Stock | 203,169 | ' | ' |
Gain On Convertible Preferred Stock Issued In Exchange For Settlement Of Debt And Accrued Interest | 57,248 | ' | ' |
Gain on Convertible Preferred Stock Issued in Exchange For Related Party Accounts Payable | 195,042 | ' | ' |
Convertible Preferred Stock Shares Issued In Exchange For Deferred Compensation | 609,507 | ' | ' |
Accrued Deferred Compensation Exchanged For Convertible Preferred Stock | 609,507 | ' | ' |
Accrued Payroll Taxes Exchanged For Convertible Preferred Stock | 46,626 | ' | ' |
Accounts Payable Exchanged For Convertible Preferred Stock | 114,792 | ' | ' |
Convertible Preferred Stock Shares Issued In Exchange For Accounts Payable | 114,792 | ' | ' |
Gain on Convertible Preferred Stock Issued in Exchange For Accounts Payable | 110,200 | ' | ' |
Gain on Convertible Preferred Stock Issued in Exchange For Other Accounts Payables | 38,514 | ' | ' |
Professional Fees Related To The Issuance Of Convertible Preferred Stock | 9,694 | ' | ' |
Convertible Preferred Stock, Terms of Conversion | 'The shares of Series A convertible preferred stock are convertible into common shares of the Company at the rate of one share of common stock per share of Series A convertible preferred stock. | ' | ' |
Preferred Stock, Dividend Payment Rate, Variable | 'one cent per share per annum through December 31, 2016, five cents per share per annum through December 31, 2017, six cents per share per annum through December 31, 2018, seven cents per share per annum through December 31, 2019, eight cents per share per annum through December 31, 2020, nine cents per share per annum through December 31, 2021, ten cents per share per annum through December 31, 2022, eleven cents per share per annum through December 31, 2023, and twelve cents per share per annum thereafter | ' | ' |
Preferred Stock, Dividend Payment Terms | 'payable within 90 days following the 31st day of December each year on such date as determined by the board of directors. The dividends are cumulative and beginning January 1, 2017, the board of directors of the Company may elect to make any required dividend payment with the Company’s unregistered common stock in lieu of cash. | ' | ' |
Series A convertible preferred stock issued in settlement of liabilities | $672,472 | ' | $672,472 |
Note_I_Related_Party_Details
Note I - Related Party (Details) (USD $) | 12 Months Ended | |
Dec. 31, 2013 | ||
Details | ' | |
Notes Payable, Related Parties | $225,189 | [1],[2] |
ReclassificationOfRelatedPartyAccountsPayableToConvertibleDebtRelatedParty | 50,000 | |
Convertible Preferred Stock Shares Issued for Settlement of Related Party Accounts Payable | 203,169 | |
Related Party Accounts Payable Settled With Debt and Preferred Stock | 253,169 | |
Gain on Settlement of Related Party Accounts Payable | $195,042 | |
[1] | Interest rate 6% through December 31, 2014, 7% through December 31, 2015, 8% through December 31, 2016, 8.5% through December 31, 2017 and 9% through May 31, 2018 | |
[2] | Convertible into common stock of the Company at the rate of $1.00 per share |
Note_J_Concentrations_Details
Note J - Concentrations (Details) | 12 Months Ended | |||
Dec. 31, 2013 | Dec. 31, 2012 | |||
Details | ' | ' | ||
Concentration Risk, Percentage | 9.00% | [1] | 11.00% | [1] |
[1] | Customer A |
Note_K_Subsequent_Event_Detail
Note K - Subsequent Event (Details) (USD $) | 1 Months Ended | 12 Months Ended | |
Feb. 28, 2014 | Dec. 31, 2013 | Dec. 31, 2012 | |
Details | ' | ' | ' |
Share-based Compensation Arrangement by Share-based Payment Award, Options, Grants in Period, Gross | 3,000 | 2,793,348 | 341,000 |
Share-based Compensation Arrangement by Share-based Payment Award, Options, Grants in Period, Weighted Average Exercise Price | $0.05 | ' | $0.00 |
Note_G_Common_Stock_and_Stockb8
Note G - Common Stock and Stock-based Compensation: Schedule of Employee Stock Option Activity (Details) (USD $) | 1 Months Ended | 12 Months Ended | ||
Feb. 28, 2014 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | |
Details | ' | ' | ' | ' |
Share-based Compensation Arrangement by Share-based Payment Award, Options, Outstanding, Number | ' | 3,202,882 | 1,404,550 | 1,462,783 |
Share-based Compensation Arrangement by Share-based Payment Award, Options, Outstanding, Weighted Average Exercise Price | ' | $0.03 | $0.03 | $0.04 |
Share-based Compensation Arrangement by Share-based Payment Award, Options, Outstanding, Weighted Average Remaining Contractual Term | ' | 9.1 | 3.06 | 2.89 |
Share-based Compensation Arrangement by Share-based Payment Award, Options, Exercisable, Number | ' | 1,755,882 | 1,249,550 | 1,342,883 |
Share-based Compensation Arrangement by Share-based Payment Award, Options, Exercisable, Weighted Average Exercise Price | ' | $0.03 | $0.04 | $0.04 |
Share-based Compensation Arrangement by Share-based Payment Award, Options, Exercisable, Weighted Average Remaining Contractual Term | ' | 8.75 | 2.27 | 2.38 |
Share-based Compensation Arrangement by Share-based Payment Award, Options, Grants in Period, Gross | 3,000 | 2,793,348 | 341,000 | ' |
Share-based Compensation Arrangement by Share-based Payment Award, Options, Grants in Period, Weighted Average Exercise Price | $0.05 | ' | $0.00 | ' |
Share-based Compensation Arrangement by Share-based Payment Award, Options, Exercises in Period | ' | ' | -140,000 | ' |
Share-based Compensation Arrangements by Share-based Payment Award, Options, Exercises in Period, Weighted Average Exercise Price | ' | ' | $0.00 | ' |
Share-based Compensation Arrangement by Share-based Payment Award, Options, Nonvested Options Forfeited, Number of Shares | ' | -57,000 | -75,566 | ' |
Share-based Compensation Arrangements by Share-based Payment Award, Options, Forfeitures in Period, Weighted Average Exercise Price | ' | $0.03 | $0.02 | ' |
Share-based Compensation Arrangement by Share-based Payment Award, Options, Expirations in Period | ' | -110,168 | -183,667 | ' |
Share-based Compensation Arrangements by Share-based Payment Award, Options, Expirations in Period, Weighted Average Exercise Price | ' | $0.04 | $0.05 | ' |
Share-based Compensation Arrangement by Share-based Payment Award, Options, Exercisable, Intrinsic Value | ' | $42,261 | $4,920 | ' |
Share-based Compensation Arrangements by Share-based Payment Award, Options, Grants in Period, Weighted Average Exercise Price | ' | $0.03 | ' | ' |
Share-based Compensation Arrangement by Share-based Payment Award, Options, Other Increases (Decreases) in Period | ' | -827,848 | ' | ' |
Share-based Compensation Arrangements by Share-based Payment Award, Options, Other Share Increase (Decrease) in Period, Weighted Average Exercise Price | ' | $0.04 | ' | ' |