Document_and_Entity_Informatio
Document and Entity Information | 9 Months Ended | |
Sep. 30, 2013 | Nov. 11, 2013 | |
Document And Entity Information | ' | ' |
Entity Registrant Name | 'EAST COAST DIVERSIFIED CORP | ' |
Entity Central Index Key | '0001256540 | ' |
Document Type | '10-Q | ' |
Document Period End Date | 30-Sep-13 | ' |
Amendment Flag | 'false | ' |
Current Fiscal Year End Date | '--12-31 | ' |
Is Entity a Well-known Seasoned Issuer? | 'No | ' |
Is Entity a Voluntary Filer? | 'No | ' |
Is Entity's Reporting Status Current? | 'Yes | ' |
Entity Filer Category | 'Smaller Reporting Company | ' |
Entity Common Stock, Shares Outstanding | ' | 1,912,426,925 |
Document Fiscal Period Focus | 'Q3 | ' |
Document Fiscal Year Focus | '2013 | ' |
Consolidated_Balance_Sheets
Consolidated Balance Sheets (USD $) | Sep. 30, 2013 | Dec. 31, 2012 |
ASSETS | ' | ' |
Cash | $368 | $0 |
Accounts receivable, net | 222,007 | 200,040 |
Inventory | 63,424 | 108,777 |
Prepaid license fees | 200,000 | 200,000 |
Prepaid expenses | 23,030 | 15,818 |
Assets attributable to disputed subsidiary | 107,271 | 107,271 |
Total current assets | 616,100 | 631,906 |
Property and equipment, net | 4,235 | 7,401 |
Other assets | ' | ' |
Prepaid license fees | 50,000 | 87,500 |
Security deposits | 20,000 | 20,000 |
Total other assets | 70,000 | 107,500 |
Total assets | 690,335 | 746,807 |
Current liabilities | ' | ' |
Bank overdraft | 37,705 | 6,028 |
Loans payable, current | 667,003 | 404,761 |
Loans payable - related party, current | 499,547 | 539,909 |
Due to related party | 24,687 | 64,673 |
Accounts payable and accrued expenses | 607,853 | 508,940 |
Accrued payroll and related liabilities | 2,342,175 | 1,938,279 |
Liabilities attributable to disputed subsidiary | 11,116 | 11,116 |
Total current liabilities | 4,190,086 | 3,473,706 |
Other liabilities | ' | ' |
Loans payable, non-current | 0 | 0 |
Total liabilities | 4,190,086 | 3,473,706 |
Contingent acquisition liabilities | 1,081,850 | 1,104,973 |
Amounts payable in common stock | 121,225 | 294,955 |
Derivative liability | 65,275 | 158,822 |
Common stock, $0.001 par value, 5,900,000,000 and 5,900,000,000 shares authorized, 1,337,028,459 and 7,198,321 shares issued and outstanding at September 30, 2013 and December 31, 2012, respectively | 1,337,028 | 7,198 |
Additional paid-in capital | 15,682,954 | 15,930,512 |
Preferred stock issuable | 49,000 | 0 |
Common stock issuable | 14,000 | 0 |
Preferred stock subscriptions receivable | -1,113,498 | -1,155,998 |
Accumulated deficit | -20,570,624 | -18,812,108 |
Total East Coast Diversified stockholders' deficit | -4,391,778 | -3,927,034 |
Noncontrolling interest | -376,323 | -358,615 |
Total stockholders' deficit | -4,768,101 | -4,285,649 |
Total liabilities and stockholders' deficit | 690,335 | 746,807 |
Series A Preferred Stock [Member] | ' | ' |
Other liabilities | ' | ' |
Preferred stock | 209,362 | 103,362 |
Series B Preferred Stock [Member] | ' | ' |
Other liabilities | ' | ' |
Preferred stock | $0 | $0 |
Consolidated_Balance_Sheets_Pa
Consolidated Balance Sheets (Parenthetical) (USD $) | Sep. 30, 2013 | Dec. 31, 2012 |
Preferred stock par value | $0.00 | $0.00 |
Common stock par value | $0.00 | $0.00 |
Common stock shares authorized | 5,900,000,000 | 5,900,000,000 |
Common stock shares issued | 1,337,028,459 | 7,198,321 |
Common stock shares oustanding | 1,337,028,459 | 7,198,321 |
Series A Preferred Stock [Member] | ' | ' |
Preferred stock shares authorized | 400,000,000 | 400,000,000 |
Preferred stock shares issued | 209,362,091 | 103,361,855 |
Preferred stock shares outstanding | 209,362,091 | 103,361,855 |
Series B Preferred Stock [Member] | ' | ' |
Preferred stock shares issued | 5 | 5 |
Preferred stock shares outstanding | 5 | 5 |
Consolidated_Statements_of_Ope
Consolidated Statements of Operations (USD $) | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2013 | Sep. 30, 2012 | |
Revenues: | ' | ' | ' | ' |
Product sales | $101,563 | $52,721 | $155,385 | $514,397 |
Consulting and development | 0 | 0 | 0 | 151,920 |
User fees | 5,386 | 13,593 | 13,783 | 44,401 |
Total revenues | 106,949 | 66,314 | 169,168 | 710,718 |
Product sales | 69,979 | 41,096 | 96,492 | 333,289 |
Consulting and development | 0 | 0 | 0 | 0 |
User fees | 6,757 | 10,006 | 20,076 | 48,184 |
Selling, general and administative expense | 453,896 | 956,732 | 1,522,806 | 2,529,998 |
Total operating expenses | 530,632 | 1,007,834 | 1,639,374 | 2,911,471 |
Loss from operations | -423,683 | -941,520 | -1,470,206 | -2,200,753 |
Other income (expense) | ' | ' | ' | ' |
Other income | 0 | 57,003 | 0 | 58,387 |
Interest expense | -125,578 | -134,083 | -460,295 | -635,280 |
Gain on settlement of debt | 0 | 0 | 0 | 141,141 |
Loss on conversion of debt | 0 | 0 | 0 | -575,263 |
Change in derivative liability | 160,000 | 8,518 | 154,277 | -2,291 |
Total other income (expense) | 34,422 | -68,562 | -306,018 | -1,013,306 |
Net loss | -389,261 | -1,010,082 | -1,776,224 | -3,214,059 |
Net loss attributable to noncontrolling interests | 4,459 | 47,136 | 17,708 | 33,746 |
Net loss from non-disputed operations | -384,802 | -962,946 | -1,758,516 | -3,180,313 |
Net income (loss) from disputed subsidiary | 0 | -12,047 | 0 | -41,167 |
Net loss attributable to East Coast Diversified Corporation | ($384,802) | ($974,993) | ($1,758,516) | ($3,221,480) |
Net loss per share - basic and diluted | $0 | ($0.43) | ($0.01) | ($2.23) |
Weighted average number of shares outsanding during the period - basic and diluted (in Shares) | 601,870,578 | 2,285,512 | 215,198,540 | 1,441,437 |
Consolidated_Statements_of_Cas
Consolidated Statements of Cash Flows (USD $) | 9 Months Ended | |
Sep. 30, 2013 | Sep. 30, 2012 | |
Consolidated Statements Of Cash Flows | ' | ' |
Net loss | ($1,758,516) | ($3,221,480) |
Noncontrolling interests | -17,708 | -73,299 |
Depreciation and amortization | 3,166 | 24,046 |
Provision for doubtful accounts | 0 | 311,671 |
Amortization of intangibles of disputed subsidiary | 0 | 114,750 |
Issuance of loan payable for consulting services | 78,922 | 60,000 |
Stock issued for services and compensation | 12,900 | 425,205 |
Amortization of prepaid license fee | 37,500 | 37,500 |
Amortization of payment redemption premium as interest | 0 | 12,076 |
Gain on recovery of redemption premiums | 0 | -28,975 |
Gain on settlement of loans payable | 0 | -38,646 |
Gain on settlement of accounts payable | 0 | -102,495 |
Loss on conversion of debt | 0 | 575,263 |
Change in derivative liability | -154,277 | 2,291 |
Accretion of beneficial conversion feature on convertible notes payable as interest | 400,424 | 604,841 |
Accretion of stock discounts to comvetible notes payable as interest | 0 | 2,160 |
Interest accrued on loans payable | 56,626 | 47,224 |
Assets attributable to disputed subsidiary | 0 | -107,271 |
Liabilities attributable to disputed subsidiary | 0 | 11,116 |
Accounts receivable, net | -21,967 | -553,551 |
Inventory | 45,353 | -80,261 |
Prepaid expenses | -7,212 | -9,000 |
Security deposits | 0 | -15,479 |
Escrow deposits | 0 | -448 |
Bank overdraft, net | 31,677 | -16,675 |
Due to related party | -39,986 | -70,568 |
Accounts payable and accrued expenses | 98,913 | 608,686 |
Accrued payroll and related liabilities | 564,396 | 239,282 |
Net cash used in operating activities | -669,789 | -1,242,037 |
Cash flows from investing activities: | ' | ' |
Capital expenditures | 0 | -700 |
Net cash used in investing activities | 0 | -700 |
Proceeds from issuance of common stock | 20,000 | 1,000 |
Proceeds from common stock subscriptions | 14,000 | 0 |
Repurchase of common stock | -5,000 | 0 |
Proceeds from issuance of preferred stock | 184,000 | 151,900 |
Proceeds from preferred stock subscription | 91,500 | 325,002 |
Proceeds from loans payable | 302,500 | 676,076 |
Proceeds from loans payable - related party | 65,157 | 56,500 |
Repayments of loans payable | -2,000 | -12,600 |
Repayments of loans payable - related party | 0 | -5,000 |
Net cash from financing activities | 670,157 | 1,192,878 |
Net increase (decrease) in cash | 368 | -49,859 |
Cash at beginning of period | 0 | 53,519 |
Cash at end of period | 368 | 3,660 |
Cash paid for interest | 3,245 | 0 |
Cash paid for taxes | 0 | 0 |
Non-cash investing and financing activities: | ' | ' |
Issuance of 1,210,999,766 and 1,702,745 shares of common stock in conversion of loans payable, respectively | 219,159 | 768,036 |
Issuance of 1,000,000 shares of series A preferred stock in conversion of loans payable | 0 | 57,000 |
Issuance of 15,833,333 and 2,592,898 shares of series A preferred stock in conversion of loans payable - related party, respectively | 115,000 | 87,500 |
Payment redemption premiums on convertible notes payable | 0 | 10,000 |
Loans and accounts payable converted to Amounts payable in common stock | 0 | 1,068,345 |
Issuance of 101,300,000 and 1,240,400 shares of common stock in settlement of loans and accounts payable converted to Amounts payable in common stock, respectively | 113,000 | 1,114,930 |
Issuance of 4,324,515 shares of Series A preferred stock to related parties in conversion of 172,981 shares of common stock | 0 | 86,490 |
Issuance of 372,000 shares of Series A preferred stock to third parties in conversion of 14,880 shares of common stock | 0 | 7,440 |
Issuance of 3,000 shares of series B preferred stock under stock subscription | 0 | 1,500,000 |
Beneficial conversion feature of convertible notes payable | 345,590 | 708,137 |
Discount for stock issued in connection with issuance of note payable | 0 | 2,160 |
Issuance of 15,000 shares of common stock in conversion of accrued salaries | 0 | 22,500 |
Issuance of 35,833,333 and 408,164 shares of series A preferred stock in conversion of accrued salaries, respectively | 160,500 | 40,000 |
Prepaid license fee accrued as due to related party | 0 | 150,000 |
Reduction of acquisition liabilities due to conversion of 39,050 shares of Series A preferred stock to 6,219,000 shares of common stock | $23,123 | $0 |
Consolidated_Statements_of_Cas1
Consolidated Statements of Cash Flows (Parenthetical) | 9 Months Ended | |
Sep. 30, 2013 | Sep. 30, 2012 | |
Consolidated Statements Of Cash Flows Parenthetical | ' | ' |
Issuance of common stock in conversion of loans payable | 1,210,999,766 | 1,702,745 |
Issuance of shares of series A preferred stock in conversion of loans payable | ' | 1,000,000 |
Issuance of shares of series A preferred stock in conversion of loans payable - related party | 15,833,333 | 2,592,898 |
Issuance of shares of common stock in settlement of loans and accounts payable converted to Amounts payable in common stock | 101,300,000 | 1,240,400 |
Issuance of shares of Series A preferred stock to related parties in conversion of shares of common stock | 0 | 4,324,515 |
Issuance of shares of Series A preferred stock to third parties in conversion of shares of common stock | ' | 372,000 |
Issuance of shares of series B preferred stock under stock subscription | ' | 3,000 |
Issuance of shares of common stock in conversion of accrued salaries | ' | 15,000 |
Issuance of shares of series A preferred stock in conversion of accrued salaries | 35,833,333 | 408,164 |
Reduction of acquisition liabilities due to conversion of shares of Series A preferred stock | 39,050 | ' |
Reduction of acquisition liabilities due to conversion of shares of common stock | 6,219,000 | ' |
1_Nature_of_Business_Presentat
1. Nature of Business, Presentation, and Going Concern | 9 Months Ended |
Sep. 30, 2013 | |
Nature Of Business Presentation And Going Concern | ' |
NOTE 1 - Nature of Business, Presentation, and Going Concern | ' |
Organization | |
EarthSearch Communications International, Inc. (“EarthSearch”) was founded in November 2003 as a Georgia corporation. The company subsequently re-incorporated in Delaware on July 8, 2005. | |
On December 18, 2009, East Coast Diversified Corporation's (“ECDC” or the “Company”) former principal stockholders, Frank Rovito, Aaron Goldstein and Green Energy Partners, LLC (collectively the “Sellers”), entered into a Securities Purchase Agreement (the "Purchase Agreement") with Kayode Aladesuyi (the “Buyer”), pursuant to which the Sellers, beneficial owners of an aggregate of 6,997,150 shares of the Company's common stock (the “Sellers' Shares”), agreed to sell and transfer the Sellers' Shares to the Buyer for an aggregate of Three Hundred Thousand Dollars ($300,000.00). The Purchase Agreement also provided that the Company would enter into a share exchange agreement with EarthSearch. | |
On January 15, 2010, the Company entered into a share exchange agreement (the “Share Exchange Agreement”) with EarthSearch, pursuant to which the Company agreed to issue 35,000,000 shares of the Company's restricted common stock to the shareholders of EarthSearch. On April 2, 2010, EarthSearch consummated all obligations under the Share Exchange Agreement. In accordance with the terms and provisions of the Share Exchange Agreement, the Company acquired 93.49% of the issued and outstanding common stock of EarthSearch. As a result of the Purchase Agreement and Share Exchange Agreement, our principal business became the business of EarthSearch. The Board of Directors of the Company (the “Board”) passed a resolution electing the new members of the Board and appointing new management of the Company and effectively resigning as their last order of business. | |
The Share Exchange was accounted for us as an acquisition and recapitalization. EarthSearch is the acquirer for accounting purposes and, consequently, the assets and liabilities and the historical operations that are reflected in the consolidated financial statements herein are those of EarthSearch. The accumulated deficit of EarthSearch was also carried forward after the acquisition. | |
On December 31, 2012, the Company acquired 1,800,000 additional shares of EarthSearch from a non-controlling shareholder in exchange for 439,024 shares of the Company's common stock. As of December 31, 2012, the Company owns 94.66% of the issued and outstanding stock of EarthSearch. | |
On October 23, 2011, the Company entered into a Share Exchange Agreement (the “RP Share Exchange Agreement”) with Rogue Paper, Inc., a California corporation (“Rogue Paper”), and shareholders of Rogue Paper (the “Rogue Paper Holders”). Rogue Paper is headquartered in San Francisco, California and is a developer of mobile and branded applications for major media enterprises. The Company acquired fifty-one percent (51%) of the issued and outstanding common stock of Rogue Paper in exchange for 2,500,000 shares of the Company’s Series A convertible preferred stock (the “Series A Preferred”). | |
Pursuant to the RP Share Exchange Agreement, no sooner than twelve months from the Effective Date, the Series A Preferred shares shall be convertible, at the option of the holder of such shares, into an aggregate of fifty million shares of the Company’s common stock, par value $0.001 per share. Beginning sixth months from the Effective Date, both the Company and holders of the Series A Preferred shares shall have the option to redeem any portion of such holders’ Series A Preferred shares, for cash, at a price of sixty cents ($0.60) per share. Additionally, commencing twenty-four (24) months from the Effective Date, the holders of the remaining, unsold shares of Rogue Paper common stock may require the Company to redeem such shares, for cash, at a price of three cents ($0.03) per share. During the fourth quarter of 2012, the management of Rogue Paper effectively shut-down operations, denied the Company access to financial records, refused to participate in shareholder or management meetings and all members of Rogue management resigned January 25, 2013. No legal action has been taken by either Rogue Paper or the Company. As financial records have not been available since September 30, 2012, the Company has treated the balance sheets and results of operations of Rogue Paper as a discontinued operation. | |
On January, 12, 2012, StudentConnect Inc., a Georgia corporation, was formed as a subsidiary of the Company. | |
On July, 4, 2012, WetWinds Inc., a Georgia corporation, was formed as a subsidiary of the Company. | |
Nature of Operations | |
The Company is a holding company for several subsidiaries offering products and services in several areas of technology. EarthSearch Communications is a Logistics and Asset Management Company. The Company has created an integration of Radio Frequency Identification Technology (“RFID”) and GPS technology and is an international provider of supply chain management solutions offering real-time visibility in the supply chain with integrated RFID/GPS and other telemetry products. These solutions help businesses worldwide to increase asset management, provide safety and security, increase productivity, and deliver real-time visibility of the supply chain through automation. | |
StudentConnect provides school transportation technology that would allow parents to receive real time notification about the status of their children. The company utilizes wireless communication between GPS and RFID to provide these services. The product is provided to schools and parents at zero cost. The Company’s business model allows it to charge business advertisers who sponsor alerts and messages to parents receiving the messages. | |
Wetwinds launched Vir2o, its social media platform, on April 5, 2012, and has commenced marketing of the platform to users globally. The Company offers users a community newsfeed, messaging module, profile wall and private rooms to share content with friends and families. Each user will have their own private photo, music, movie, game ecommerce rooms. Users can privately or publicly share content in these rooms with their friends and family. We also provide the interactive “JoinMe” technology that allows users and friends to engage in meaningful social activities online. All of our revenue from Vir2o will be advertisement driven. | |
Rogue Paper, Inc. (“Rogue Paper”), the Company’s majority owned subsidiary, offers second screen technology to the media organizations and businesses. During the fourth quarter of 2012, the management of Rogue Paper effectively shut-down operations, denied the Company access to financial records, refused to participate in shareholder or management meetings and all members of Rogue management resigned on January 25, 2013. No legal action has been taken by either Rogue Paper or the Company. As financial records have not been available since September 30, 2012, the Company has treated the balance sheets and results of operations of Rogue Paper as a discontinued operation. | |
Basis of Presentation | |
The accompanying unaudited consolidated financial statements have been prepared in accordance with accounting principles generally accepted in The United States of America (“U.S. GAAP”) and the rules and regulations of the Securities and Exchange Commission (“SEC”) for interim financial information. Accordingly, they do not include all of the information and footnotes required in annual financial statements. In the opinion of management, the unaudited financial statements contain all adjustments (consisting only of normal recurring accruals) necessary to present fairly the financial position and results of operations and cash flows. All intercompany transactions and accounts have been eliminated in consolidation. The results of operations presented are not necessarily indicative of the results to be expected for any other interim period or for the entire year. | |
These unaudited consolidated financial statements should be read in conjunction with our 2012 annual consolidated financial statements included in our annual report on Form 10-K, filed with the SEC on April 16, 2013. | |
Going Concern | |
The accompanying unaudited consolidated financial statements have been prepared on a going concern basis, which contemplates the realization of assets and the satisfaction of liabilities in the normal course of business. As reflected in the accompanying unaudited consolidated financial statements, the Company had an accumulated deficit of $20,570,624 at September 30, 2013, a net loss and net cash used in operations of $1,758,516 and $669,789, respectively, for the nine months ended September 30, 2013. These conditions raise substantial doubt about the Company’s ability to continue as a going concern. | |
The ability of the Company to continue as a going concern is dependent upon the Company’s ability to further implement its business plan, generate revenues, and continue to raise additional investment capital. No assurance can be given that the Company will be successful in these efforts. | |
The unaudited consolidated financial statements do not include any adjustments relating to the recoverability and classification of recorded asset amounts or the amounts and classification of liabilities that might be necessary should the Company be unable to continue as a going concern. Management believes that actions presently being taken to obtain additional funding and implement its strategic plans will afford the Company the opportunity to continue as a going concern. | |
Reclassifications | |
Certain items on the statements of operations for the three and nine months ended September 30, 2012 and statement of cash flows for the nine months ended September 30, 2012 have been reclassified to conform to current period presentation. | |
Concentration of Credit Risk | |
The Company grants unsecured credit to commercial and governmental customers in the United States and abroad. Accounts receivable are recorded at the invoiced amount, net of an allowance for doubtful accounts. As of September 30, 2013 and December 31, 2012, two customers account for 70% and 79% of the total accounts receivable, respectively. | |
The allowance for doubtful accounts is the Company’s best estimate of the amount of probable credit losses in the Company’s existing accounts receivable. The Company determines the allowance based on historical write-off experience, customer specific facts and economic conditions. Bad debt expense was $nil and $311,671 for the nine months ended September 30, 2013 and 2012, respectively. At September 30, 2013 and December 31, 2012, the allowance for doubtful accounts was $604,735. | |
Outstanding account balances are reviewed individually for collectability. Account balances are charged off against the allowance after all means of collection have been exhausted and the potential for recovery is considered remote. The Company does not have any off-balance sheet credit exposure to its customers. |
2_Disputed_Subsidiary
2. Disputed Subsidiary | 9 Months Ended | ||||||||
Sep. 30, 2013 | |||||||||
Disputed Subsidiary | ' | ||||||||
NOTE 2 - Disputed Subsidiary | ' | ||||||||
During the fourth quarter of 2012, the management of Rogue Paper effectively shut-down operations, denied the Company access to financial records, refused to participate in shareholder or management meetings and all members of Rogue Paper management resigned on January 25, 2013. No legal action has been taken by either Rogue Paper or the Company. As financial records have not been available since September 30, 2012, the Company has treated the balance sheets and results of operations of Rogue Paper as of and for the periods ended September 30, 2013 and December 31, 2012, respectively, as a discontinued operation. | |||||||||
The following table shows the results of Rogue Paper included in the income (loss) from disputed subsidiary: | |||||||||
Nine Months Ended September 30, | |||||||||
2013 | 2012 | ||||||||
Revenue | $ | – | $ | 322,000 | |||||
Operating expenses: | |||||||||
Cost of revenue | – | 135,221 | |||||||
Selling, general and administrative expenses | – | 267,543 | |||||||
Amortization of intangible assets | – | – | |||||||
Total operating expenses | – | 402,764 | |||||||
Income (loss) from disputed subsidiary | – | (80,764 | ) | ||||||
Other expenses: | |||||||||
Other income | – | (44 | ) | ||||||
Net loss attributable to noncontrolling interests | – | (39,553 | ) | ||||||
Net income (loss) from loss from disputed subsidiary | $ | – | $ | (41,167 | ) | ||||
The major classes of assets and liabilities of disputed subsidiary on the balance sheet are as follows: | |||||||||
September 30, | December 31, | ||||||||
2013 | 2012 | ||||||||
ASSETS | |||||||||
Current assets: | |||||||||
Cash | $ | 70,951 | $ | 70,951 | |||||
Accounts receivable | 27,480 | 27,480 | |||||||
Prepaid expenses | 1,000 | 1,000 | |||||||
Total current assets | 99,431 | 99,431 | |||||||
Property and equipment, net | 7,840 | 7,840 | |||||||
Total assets of discontinued operations | $ | 107,271 | $ | 107,271 | |||||
LIABILITIES | |||||||||
Current liabilities: | |||||||||
Accounts payable | $ | 11,116 | $ | 11,116 | |||||
Total liabilities of discontinued operations | $ | 11,116 | $ | 11,116 |
3_Loans_Payable
3. Loans Payable | 9 Months Ended | ||||||||
Sep. 30, 2013 | |||||||||
Loans Payable [Abstract] | ' | ||||||||
NOTE 3 - Loans Payable | ' | ||||||||
Loans payable at September 30, 2013 and December 31, 2012 consist of the following: | |||||||||
September 30, | December 31, | ||||||||
2013 | 2012 | ||||||||
Unsecured $30,000 convertible note payable to Hanover Holdings I, LLC, which bears interest at 12% per annum and due October 17, 2012. During the year ended December 31, 2012, $28,000 of the note balance was converted to common stock. During the nine months ended September 30, 2013, $2,000 of the note was converted to common stock. Accrued interest is equal to $2.905 and $2,750 at September 30, 2013 and December 31, 2012, respectively. This note is in default at September 30, 2013. | $ | 2,905 | $ | 4,750 | |||||
On February 17, 2012, Panache Capital, LLC entered into an agreement to purchase $50,000 of the note payable to Azfar Haque. The Company exchange the original note to Mr. Haque with a new note to Pananche which bears interest at 10% per annum and due February 17, 2013. During the year ended December 31, 2012, $44,348 of the note was converted to common stock. Accrued interest is equal to $1,254 and $786 at September 30, 2013 and December 31, 2012, respectively. This note is in default at September 30, 2013. | 6,906 | 6,438 | |||||||
Unsecured $70,000 convertible note payable to Hanover Holdings I, LLC, which bears interest at 12% per annum and due October 24 2013. The note is discounted for its unamortized beneficial conversion feature of $2,228 and $27,575 at September 30, 2013 and December 31, 2012, respectively. Accrued interest is equal to $14,127 and $7,309 at September 30, 2013 and December 31, 2012, resepctively. | 81,899 | 49,734 | |||||||
In February 2012, Magna Group, LLC entered into two agreements to purchase a total of $275,000 of the note payable to Azfar Haque. The Company exchanged the original note to Mr. Haque with new notes to Magna which bear interest at 12% per annum and due February 24, 2013. During the year ended December 31, 2012, the entire note balance, including accrued interest of $600, totaling $275,600 was converted to common stock. | – | – | |||||||
Unsecured conversion feature of $-0- and $4,492 at September 30, 2013 and December 31, 2012. Accrued interest is equal to $2,833 and $1,297 at September 30, 2013 and December 31, 2012, respectively. This note is in default at September 30, 2013.$16,000 convertible note payable to Hanover Holdings I, LLC, which bears interest at 12% per annum and due May 3, 2013. The note is discounted for its unamortized beneficial | 18,833 | 12,805 | |||||||
Unsecured $10,000 convertible note payable to Hanover Holdings I, LLC, which bears interest at 12% per annum and due January 3, 2013. The note is discounted for its unamortized beneficial conversion feature of $-0- and $535 at September 30, 2013 and December 31, 2012, respectively. During the nine months ended September 30, 2013, the note balance of $10,952. including accrued interest, was converted to common stock. Accrued interest is equal to $766 at December 31, 2012. | – | 10,231 | |||||||
Unsecured $3,000 convertible note payable to Hanover Holdings I, LLC, which bears interest at 12% per annum and due January 21, 2013. During the nine months ended September 30, 2013, the note, including accrued interest of $1,770, was converted to common stock. | – | 3,013 | |||||||
Unsecured $12,000 convertible note payable to Hanover Holdings I, LLC, which bears interest at 12% per annum and due February 5, 2013. During the nine months ended September 30, 2013, $6,210 of the note was converted to common stock. The note is discounted for its unamortized beneficial conversion feature of $-0- and $1,433 at September 30, 2013 and December 31, 2012, respectively. Accrued interest is equal to $1,795 amd $839 at September 30, 2013 and December 31, 2012, respectively. This note is in default at September 30, 2013. | 7,585 | 11,406 | |||||||
September 30, | December 31, | ||||||||
2013 | 2012 | ||||||||
Unsecured $32,500 convertible note payable to Asher Enterprises, Inc., which bears interest at 8% per annum and due February 25, 2012. During the year ended December 31, 2012, $12,000 of the note was converted to common stock. During the nine months ended September 30, 2013, the remaining $21,800 was converted to common stock. The note is discounted for its unamortized beneficial conversion feature of $3,092 at December 31, 2012. Accrued interest is equal to $1,600 at December 31, 2012. | – | 19,008 | |||||||
On November 2, 2011, the Company entered into a Unsecured Convertible Promissory Note Agreement with Bulldog Insurance for up to $250,000, which bears interest at 8% per annum. On May 10, 2012, the Company received $3,200, which is due December 31, 2012. During the year ended December 31, 2012, the reamining balance of the note including accrued interest totalling $3,262 was purchased by StarCity Capital, LLC. | – | – | |||||||
On November 2, 2011, the Company entered into a Unsecured Convertible Promissory Note Agreement with Bulldog Insurance for up to $250,000, which bears interest at 8% per annum. On June 7, 2012, the Company received $2,500, which is due December 31, 2012. During the year ended December 31, 2012, the reamining balance of the note including accrued interest totalling $2,540 was purchased by StarCity Capital, LLC. | – | – | |||||||
On November 2, 2011, the Company entered into a Unsecured Convertible Promissory Note Agreement with Bulldog Insurance for up to $250,000, which bears interest at 8% per annum. On June 12, 2012, the Company received $9,500, which is due December 31, 2012. During the year ended December 31, 2012, the reamining balance of the note including accrued interest totalling $9,643 was purchased by StarCity Capital, LLC. | – | – | |||||||
Unsecured $5,500 convertible note payable to Hanover Holdings I, LLC, which bears interest at 12% per annum and due March 6, 2013. During the nine months ended September 30, 2013, the note balance of $6,050 was converted to common stock. The note is discounted for its unamortized beneficial conversion feature of $1,099 at December 31, 2012. Accrued interest is equal to $328 at December 31, 2012. | – | 4,729 | |||||||
Unsecured $42,500 convertible note payable to Asher Enterprises, Inc., which bears interest at 8% per annum and due April 19, 2013. During the nine months ended September 30, 2013, the entire balance of the note in the amount of $44,200 was converted to common stock. The note is discounted for its unamortized beneficial conversion feature of $13,379 at December 31, 2012. Accrued interest is equal to $1,579 at December 31, 2012. | – | 30,700 | |||||||
Unsecured $15,000 convertible note payable to Hanover Holdings I, LLC, which bears interest at 12% per annum and due March 26, 2013. The note is discounted for its unamortized beneficial conversion feature of $-0- and $3,484 at September 30, 2013 and December 31, 2012, respectively. Accrued interest is equal to $2,209 and $794 at September 30, 2013 and December 31, 2012, respectively. This note is in default at September 30, 2013. | 17,209 | 12,310 | |||||||
September 30, | December 31, | ||||||||
2013 | 2012 | ||||||||
On November 2, 2011, the Company entered into a Unsecured Convertible Promissory Note Agreement with Bulldog Insurance for up to $250,000, which bears interest at 8% per annum. On August 3, 2012, the Company received $18,350, which was due March 31, 2013. The draw on the note is discounted for its unamortized beneficial conversion feature of $2,741 at December 31, 2012. During the year ended December 31, 2012, $516 of the note was purchased by StarCity Capital, LLC. During the nine months ended September 30, 2013, the note balance of $19,168 was purchased by Tangiers Investment Group, LLC. Accrued interest is equal to $381 at December 31, 2012. | – | 15,474 | |||||||
On November 2, 2011, the Company entered into a Unsecured Convertible Promissory Note Agreement with Bulldog Insurance for up to $250,000, which bears interest at 8% per annum. On August 20, 2012, the Company received $10,000, which was due March 31, 2013. The draw on the note is discounted for its unamortized beneficial conversion feature of $1,514 at December 31, 2012. During the nine months ended September 30, 2013, the note balance of $10,300 was purchased by SGI Group, LLC. Accrued interest is equal to $183 at December 31, 2012. | – | 8,669 | |||||||
On November 2, 2011, the Company entered into a Unsecured Convertible Promissory Note Agreement with Bulldog Insurance for up to $250,000, which bears interest at 8% per annum. On August 27, 2012, the Company received $40,000, which was due March 31, 2013. The draw on the note is discounted for its unamortized beneficial conversion feature of $7,143 at December 31, 2012. During the nine months ended September 30, 2013, the note balance of $40,000 was purchased by WHC Capital, LLC. Accrued interest is equal to $699 at December 31, 2012. | – | 33,556 | |||||||
Unsecured $10,000 convertible note payable to Southridge Partners II LP, which bears interest at 5% per annum and due March 31, 2013. During the nine months ended September 30, 2013, the note, including accrued interest of $399, was converted to common stock. | – | 8,097 | |||||||
On November 2, 2011, the Company entered into a Unsecured Convertible Promissory Note Agreement with Bulldog Insurance for up to $250,000, which bears interest at 8% per annum. On September 5, 2012, the Company received $4,100, which was due March 31, 2013. The draw on the note is discounted for its unamortized beneficial conversion feature of $891 at December 31, 2012. During the nine months ended September 30, 2013, the note balance of $4,264 was purchased by Tangiers Investment Group, LLC. Accrued interest is equal to $66 at December 31, 2012. | – | 3,275 | |||||||
Unsecured $40,000 convertible note payable to Southridge Partners II LP, which bears interest at 5% per annum and due March 31, 2013. The note is discounted for its unamortized beneficial conversion feature of $-0- and $6,154 at September 30, 2013 and December 31, 2012, respectively. Accrued interest is equal to $3,384 and $925 at September 30, 2013 and December 31, 2012, respectively. This note is in default at September 30, 2013. | 43,384 | 34,771 | |||||||
Unsecured $15,000 note payable to SC Advisors, Inc., which bears interest at 8% per annum and due June 30, 2013. Accrued interest is equal to $1,218 and $299 at September 30, 2013 and December 31, 2012, respectively. This note is in default at September 30, 2013. | 16,218 | 15,299 | |||||||
September 30, | December 31, | ||||||||
2013 | 2012 | ||||||||
Unsecured $10,000 convertible note payable to Southridge Partners II LP, which bears interest at 8% per annum and due June 30, 2013. During the nine months ended September 30, 2013, the note, including accrued interest, was converted to common stock. The note is discounted for its unamortized beneficial conversion feature of $6,704 at December 31, 2012. Accrued interest is equal to $195 at December 31, 2012. | – | 3,491 | |||||||
On November 2, 2011, the Company entered into a Unsecured Convertible Promissory Note Agreement with Bulldog Insurance for up to $250,000, which bears interest at 8% per annum. On October 24, 2012, the Company received $5,000, which is due May 24, 2013. The draw on the note is discounted for its unamortized beneficial conversion feature of $1,456 at December 31, 2012. During the nine months ended September 30, 2013, the note balance of $5,169 was purchased by Tangiers Investment Group, LLC. Accrued interest is equal to $75 at December 31, 2012. | – | 3,619 | |||||||
Unsecured $39,647 note payable to Azfar Hague, which bears interest at 9% per annum and due April 25, 2013. $20,000 of this note was purchased by Tangiers Investment Group, LLC on July 26, 2013. Accrued interest is equal to $2,933 and $655 at September 30, 2013 and December 31, 2012, respectively. This note is in default at September 30, 2013. | 22,580 | 40,302 | |||||||
Unsecured $15,000 note payable to SC Advisors, Inc., which bears interest at 8% per annum and due June 30, 2013. Accrued interest is equal to $1,096 and $181 at September 30, 2013 and December 31, 2012, respectively. This note is in default at September 30, 2013. | 16,096 | 15,181 | |||||||
Unsecured $7,000 convertible note payable to Southridge Partners II LP, which bears interest at 8% per annum and due September 30, 2013. During the nine months ended September 30, 2013, the note, including accrued interest, was converted to common stock. The note is discounted for its unamortized beneficial conversion feature of $5,415 at December 31, 2012. Accrued interest is equal to $81 at December 31, 2012. | – | 1,666 | |||||||
Unsecured $32,500 convertible note payable to Asher Enterprises, Inc., which bears interest at 8% per annum and due August 13, 2013. During the nine months ended September 30, 2013, $3,300 of the note was converted to common stock. The note is discounted for its unamortized beneficial conversion feature of $-0- and $24,932 at September 30, 2013 and December 31, 2012, respectively. Accrued interest is equal to $2,285 and $370 at September 30, 2013 and December 31, 2012, respectively. This note is in default at September 30, 2013. | 31,485 | 7,938 | |||||||
On November 2, 2011, the Company entered into a Unsecured Convertible Promissory Note Agreement with Bulldog Insurance for up to $250,000, which bears interest at 8% per annum. On November 15, 2012, the Company received $10,000, which was due May 15, 2013. The draw on the note is discounted for its unamortized beneficial conversion feature of $3,309 at December 31, 2012. During the nine months ended September 30, 2013, the note was purchased by WHC Capital, LLC. Accrued interest is equal to $109 at December 31, 2012. | – | 7,150 | |||||||
Unsecured $18,000 convertible note payable to Southridge Partners II LP, which bears interest at 8% per annum and due June 30, 2013. During the nine months ended September 30, 2013, $14,471 of the note was converted to common stock. The note is discounted for its unamortized beneficial conversion feature of $-0- and $15,296 at September 30, 2013 and December 31, 2012, respectively. Accrued interest is equal to $1,151 and $126 at September 30, 2013 and December 31, 2012, respectively. This note is in default at September 30, 2013. | 4,680 | 2,830 | |||||||
September 30, | December 31, | ||||||||
2013 | 2012 | ||||||||
Unsecured $9,000 convertible note payable to Star City Capital LLC, which bears interest at 12% per annum and due December 3, 2013. The note is discounted for its unamortized beneficial conversion feature of $1,561 and $8,220 at September 30, 2013 and December 31, 2012, respectively. Accrued interest is equal to $907 and $83 at September 30, 2013 and December 31, 2012, respectively. | 8,346 | 863 | |||||||
Unsecured $15,000 note payable to SC Advisors, Inc., which bears interest at 8% per annum and due June 30, 2013. Accrued interest is equal to $1,010 and $99 at September 30, 2013 and December 31, 2012, respectively. This note is in default at September 30, 2013. | 16,010 | 15,099 | |||||||
Unsecured $25,000 convertible note payable to Southridge Partners II LP, which bears interest at 8% per annum and due June 30, 2013. The note is discounted for its unamortized beneficial conversion feature of $-0- and $22,625 at September 30, 2013 and December 31, 2012, respectively. Accrued interest is equal to $1,621 and $104 at September 30, 2013 and December 31, 2012, respectively.. This note is in default at September 30, 2013. | 26,621 | 2,479 | |||||||
On December 12, 2012, Star City Capital LLC entered into an agreement to purchase $19,700 of a note payable to Bulldog Insurance. The note bears interest at 8% per annum and is due on demand. During the nine months ended September 30, 2013, $10,626 of the note was converted to common stock. Accrued interest is equal to $391 and $51 at September 30, 2013 and December 31, 2012, respectively. | 9,698 | 19,751 | |||||||
Unsecured $7,500 convertible note payable to Southridge Partners II LP, which bears interest at 8% per annum and due June 30, 2013. The note is discounted for its unamortized beneficial conversion feature of $-0- and $7,378 at September 30, 2013 and December 31, 2012, respectively. Accrued interest is equal to $459 and $5 at September 30, 2013 and December 31, 2012, respectively. This note is in default at September 30, 2013. | 7,959 | 127 | |||||||
On January 3, 2013, SGI Group, LLC entered into an agreement to purchase $10,300 of notes payable to Bulldog Insurance. The note bears interest at 12% per annum and due on demand. During the nine months ended September 30, 2013, the note, including accrued interest, was converted to common stock. | – | – | |||||||
Unsecured $32,500 convertible note payable to Asher Enterprises, Inc., which bears interest at 8% per annum and due November 1, 2013. The note is discounted for its unamortized beneficial conversion feature of $3,633 at September 30, 2013. Accrued interest is equal to $1,696. | 30,563 | – | |||||||
Unsecured $35,000 convertible note payable to Lucosky Brookman LLP, which bears interest at 12% per annum and due on demand. Accrued interest is equal to $2,319. | 37,319 | – | |||||||
Unsecured $43,922 convertible note payable to Lucosky Brookman LLP, which bears interest at 12% per annum and due on demand. Accrued interest is equal to $2,910. | 46,832 | – | |||||||
September 30, | December 31, | ||||||||
2013 | 2012 | ||||||||
Unsecured $5,000 note payable to James Flowers, which include flat interest of $500 at maturity and due December 1, 2013. $2,000 of the note was repaid during the nine months ended September 30, 2013. Accrued interest is equal to $434. | 3,434 | – | |||||||
Unsecured $32,500 convertible note payable to Asher Enterprises, Inc., which bears interest at 8% per annum and due January 31, 2014. The note is discounted for its unamortized beneficial conversion feature of $13,892 at September 30, 2013. Accrued interest is equal to $1,097. | 19,705 | – | |||||||
Unsecured $7,000 note payable to Andre Fluellen, which include flat interest of $1,500 at maturity and due October 30, 2013. Accrued interest is equal to $1,247. | 8,247 | – | |||||||
Unsecured $18,000 note payable to Bulldog Insurance, which bears interest at 7% per annum and due December 1, 2013. Accrued interest is equal to $504. | 18,504 | – | |||||||
On May 6, 2013, WHC Capital, LLC entered into an agreement to purchase $50,000 of notes payable to Bulldog Insurance. The note bears interest at 8% per annum and is due March 6, 2014. During the nine months ended September 30, 2013, $19,472 of the note was converted to common stock. The note is discounted for its unamortized beneficial conversion feature of $21,128 at September 30, 2013. Accrued interest is equal to $2,704 at September 30, 2013. | 12,104 | – | |||||||
Unsecured $20,000 convertible note payable to WHC Capital, LLC., which bears interest at 8% per annum and due March 9, 2014. The note is discounted for its unamortized beneficial conversion feature of $8,613 at September 30, 2013. Accrued interest is equal to $631. | 12,018 | – | |||||||
Unsecured $20,000 note payable to Robert Saidel, which bears interest at 7% per annum and due December 1, 2013. Accrued interest is equal to $495. | 20,495 | – | |||||||
Unsecured $32,500 convertible note payable to Asher Enterprises, Inc., which bears interest at 8% per annum and due March 3, 2014. The note is discounted for its unamortized beneficial conversion feature of $15,687 at September 30, 2013. Accrued interest is equal to $876. | 17,689 | – | |||||||
Unsecured $7,500 note payable to Andre Fluellen, which include flat interest of $1,400 at maturity and due December 1, 2013. Accrued interest is equal to $926. | 8,426 | – | |||||||
Unsecured $10,000 note payable to Sammie Hill, III, which include flat interest of $2,000 at maturity and due December 15, 2013. Accrued interest is equal to $1,169. | 11,169 | – | |||||||
Unsecured $5,000 convertible note payable to Tangiers Investment Group, LLC., which bears interest at 10% per annum and due June 21, 2014. The note is discounted for its unamortized beneficial conversion feature of $3,616 at September 30, 2013. Accrued interest is equal to $138. | 1,522 | – | |||||||
On June 21, 2013, Tangiers Investment Group, LLC entered into an agreement to purchase $4,264 of notes payable to Bulldog Insurance. The note bears interest at 10% per annum and is due June 21, 2014. During the nine months ended September 30, 2013, the note was converted to common stock. | – | – | |||||||
On June 21, 2013, Tangiers Investment Group, LLC entered into an agreement to purchase $5,169 of notes payable to Bulldog Insurance. The note bears interest at 10% per annum and due June 21, 2014. During the nine months ended September 30, 2013, the note was converted to common stock. | – | – | |||||||
September 30, | December 31, | ||||||||
2013 | 2012 | ||||||||
On June 21, 2013, Tangiers Investment Group, LLC entered into an agreement to purchase $19,168 of notes payable to Bulldog Insurance. The note bears interest at 10% per annum and due June 21, 2014. During the nine months ended September 30, 2013, the note was converted to common stock. | – | – | |||||||
Unsecured $12,000 note payable to Bulldog Insurance, which bears interest at 7% per annum and due December 1, 2013. Accrued interest is equal to $221. | 12,221 | – | |||||||
Unsecured $3,000 note payable to Andre Fluellen, which include flat interest of $500 at maturity and due December 1, 2013. Accrued interest is equal to $292. | 3,292 | – | |||||||
Unsecured $3,000 note payable to Andre Fluellen, which include flat interest of $500 at maturity and due February 22, 2014. Accrued interest is equal to $32. | 3,032 | – | |||||||
Unsecured $14,500 convertible note payable to Asher Enterprises, Inc., which bears interest at 8% per annum and due May 5, 2014. The note is discounted for its unamortized beneficial conversion feature of $10,767 at September 30, 2013. Accrued interest is equal to $165. | 3,898 | – | |||||||
Unsecured $8,500 non-interest bearing note payable to Azfar Hague due February 5, 2014. | 8,500 | – | |||||||
Unsecured $10,000 non-interest bearing note payable to Azfar Hague due February 20, 2014. | 10,000 | – | |||||||
Unsecured $8,500 note payable to Bulldog Insurance, which bears interest at 5% per annum and due February 28, 2014. Accrued interest is equal to $35. | 8,535 | – | |||||||
Unsecured $7,500 note payable to Robert Saidel, which bears interest at 7% per annum and due January 8, 2014. Accrued interest is equal to $121. | 7,621 | – | |||||||
Unsecured $10,000 note payable to Robert Saidel, which bears interest at 7% per annum and due February 16, 2014. Accrued interest is equal to $86. | 10,086 | – | |||||||
Unsecured $4,000 note payable to Robert Saidel, which bears interest at 7% per annum and due March 9, 2014. Accrued interest is equal to $16. | 4,016 | – | |||||||
Unsecured $6,500 convertible note payable to Tangiers Investment Group, LLC., which bears interest at 10% per annum and due July 25, 2014. The note is discounted for its unamortized beneficial conversion feature of $5,306 at September 30, 2013. Accrued interest is equal to $119. | 1,313 | – | |||||||
On July 26, 2013, Tangiers Investment Group, LLC entered into an agreement to purchase $20,000 of notes payable to Azfar Hague. The note bears interest at 10% per annum and is due July 26, 2014. The note is discounted for its unamortized beneficial conversion feature of $16,383 at September 30, 2013. Accrued interest is equal to $362. | 3,979 | – | |||||||
Unsecured $5,000 convertible note payable to Tangiers Investment Group, LLC., which bears interest at 10% per annum and due August 2, 2014. The note is discounted for its unamortized beneficial conversion feature of $4,191 at September 30, 2013. Accrued interest is equal to $81. | 890 | – | |||||||
September 30, | December 31, | ||||||||
2013 | 2012 | ||||||||
On August 2, 2013, Tangiers Investment Group, LLC entered into an agreement to purchase $15,000 of notes payable to Bulldog Insurance. The note bears interest at 10% per annum and is due August 2, 2014. During the nine months ended September 30, 2013, $7,592 of the note was converted to common stock. The note is discounted for its unamortized beneficial conversion feature of $5,075 at September 30, 2013. Accrued interest is equal to $120. | 2,453 | – | |||||||
Unsecured $5,000 convertible note payable to WHC Capital, LLC., which bears interest at 8% per annum and due August 12 2014. The note is discounted for its unamortized beneficial conversion feature of $4,328 at September 30, 2013. Accrued interest is equal to $54. | 726 | – | |||||||
Total Loans Payable | $ | 667,003 | $ | 404,761 | |||||
The Company accrued interest expense of $47,144 and $126,284 for the nine months ended September 30, 2013 and the year ended December 31, 2012, respectively, on the above loans. Accrued interest is included in the loan balances. | |||||||||
The Company borrowed $302,500 and $851,711 during the nine months ended September 30, 2013 and the year ended December 31, 2012, respectively. The Company made payments of $2,000 and $12,600 on the loans during the nine months ended September 30, 2013 and the year ended December 31, 2012. During the nine months ended September 30, 2013, the Company converted $219,159 of loans payable into 1,210,999,766 shares of the Company’s common stock. During the year ended December 31, 2012, the Company converted $875,433 of loans payable into 3,693,754 shares of the Company’s common stock and $57,000 of loans payable into 1,000,000 shares of the Company’s Series A preferred stock. |
4_Related_Parties
4. Related Parties | 9 Months Ended | ||||||||
Sep. 30, 2013 | |||||||||
Related Parties | ' | ||||||||
NOTE 4 - Related Parties | ' | ||||||||
Loans payable – related parties at September 30, 2013 and December 31, 2012 consist of the following: | |||||||||
September 30, | December 31, | ||||||||
2013 | 2012 | ||||||||
Unsecured non-interest bearing notes payable, due on demand, to Frank Russo, a Director of the Company. During the nine months ended September 30, 2013, $60,000 of the note balance was converted to Series A preferred stock. | $ | 300,229 | $ | 354,979 | |||||
Unsecured notes payable to Edward Eppel, a Director of the Company, which bears interest at 10% per annum and is due on demand. During the nine months ended September 30, 2013, $55,000 of the note was converted to Series A preferred stock. Accrued interest is equal to $40,855 and $31,374, respectively. | 199,318 | 184,930 | |||||||
Total | $ | 499,547 | $ | 539,909 | |||||
Frank Russo, a Director of the Company, is a holder of an unsecured non-interest bearing note of the Company. At December 31, 2012, $354,979 was due to Mr. Russo. The Company borrowed $5,250 from Mr. Eppel during the nine months ended September 30, 2013. During the nine months ended September 30, 2013, the Company converted $60,000 of the note into 9,166,667 shares of Series A preferred stock. | |||||||||
Edward Eppel, a Director of the Company, is a holder of a note of the Company which bears interest at 10% per annum. At December 31, 2012, $184,930 was due to Mr. Eppel. The Company borrowed $59,908 from Mr. Eppel during the nine months ended September 30, 2013. $9,480 of interest was accrued and included in the loan balance for the nine months ended September 30, 2013. During the nine months ended September 30, 2013, the Company converted $55,000 of the note into 6,666,667 shares of Series A preferred stock. | |||||||||
During the nine months ended September 30, 2013, Mr. Anis Sherali, a Director of the Company, purchased 10,000,000 shares of the Company’s common stock for $20,000 and 14,862,035 shares of the Company’s Series A preferred stock for $55,500. Additionally, during the nine months ended September 30, 2013 Mr. Sherali agreed to purchase 19,750,000 shares of common stock for $14,000 and 17,000,000 shares of Series A preferred stock for $49,000. These amounts are shown as common stock issuable and preferred stock issuable, respectively, at September 30, 2013. | |||||||||
The Company converted $130,000 of accrued salaries due to Mr. Kayode Aladesuyi, the Chief Executive Officer and Director of the Company, into 23,333,333 shares of the Company’s Series A preferred stock. | |||||||||
Andrea Sousa, Comptroller of the Company, is the wife of Kayode Aladesuyi. During the nine months ended September 30, 2013 the Company converted $20,000 of accrued salaries due to Ms. Rocha into 10,000,000 shares of the Company’s Series A preferred stock. |
5_Amounts_Payable_in_Common_St
5. Amounts Payable in Common Stock and Derivative Liability | 9 Months Ended |
Sep. 30, 2013 | |
Amounts Payable In Common Stock And Derivative Liability | ' |
NOTE 5 - Amounts Payable in Common Stock and Derivative Liability | ' |
During the year ended December 31, 2012, Ironridge Global IV, Ltd. (“Ironridge”) purchased $826,367 of accounts payable and $241,978 of loans payable, for a total of $1,068,345, from certain creditors of the Company. On April 20, 2012, the Superior Court of the State of California for the County of Los Angeles, Central District approved a Stipulation for Settlement of Claims (the “Settlement of Claims”) in the favor of Ironridge. The Settlement of Claims calls for the amount to be paid by issuance of the Company’s common stock. The number of shares of the common stock is to be calculated based on the volume weighted average price (“VWAP”) of the common stock over the calculation period, not to exceed the arithmetic average of the individual daily VWAPs of any five trading days during the calculation period, less a discount of 35%. The calculation period is defined as the period from the approval of the Settlement of Claims until the settlement is completed. | |
As the terms of the settlement include issuing common stock at a 35% discount to the conversion price, a derivative liability for the discount was established at the time of the Settlement of Claims of $575,263, which was charged to operations during the year ended December 31, 2012 as a loss on conversion of debt. The derivative liability is revalued at the end of each reporting period with any change in the liability being charged to operations. For the nine months ended September 30, 2013 and the year ended December 31, 2012, the change in derivative liability of $5,723 and $12,099, respectively, has been expensed. | |
As common stock is issued in installments on the settlement, the Amounts Payable in Common Stock and the Derivative Liability will be reduced accordingly. During the nine months ended September 30, 2013, 101,300,000 shares of common stock, with a market value of $113,000, were issued to Ironridge in settlement of $173,730 of the liability, resulting in the reduction of the derivative liability of $105,270. During the year ended December 31, 2012, 1,610,400 shares of common stock, with a market value of $1,201,930, were issued to Ironridge in settlement of $773,390 of the liability, resulting in the reduction of the derivative liability of $416,441. |
6_Stockholders_Deficit
6. Stockholders' Deficit | 9 Months Ended |
Sep. 30, 2013 | |
Stockholders Deficit | ' |
NOTE 6 - Stockholders' Deficit | ' |
Authorized Capital | |
On September 17, 2010, the Board authorized the creation of a common stock incentive plan (the “2010 Stock Incentive Plan”) for our management and consultants. The Company registered twenty five million (25,000,000) shares of its common stock pursuant to the 2010 Stock Incentive Plan on Form S-8 filed with the Commission on September 27, 2010. As of September 30, 2013, no options have been granted under the plan. | |
On October 19, 2012, the Company filed a certificate of amendment to the Company’s Articles of Incorporation with the Secretary of State of Nevada to increase the Company’s authorized capital stock to 6,000,000,000 shares, par value $0.001 per share, including (i) 5,900,000,000 shares of common stock, par value $0.001 per share and (ii) 100,000,000 shares of preferred stock, par value $0.001 per share. | |
On December 1, 2012, the Company’s Board of Directors elected to increase the Company’s authorized shares of Series A preferred stock to 400,000,000 shares, par value $0.001 per share and on May 9, 2013, filed a certificate of amendment to the Company’s Articles of Incorporation with the Secretary of State of Nevada to increase the Company’s authorized shares of preferred stock to 400,000,000 shares, par value $0.001 per share. | |
Stock Splits | |
On December 20, 2012, the Company's Board of Directors declared a one for five hundred reverse stock split of all outstanding shares of common stock and series B preferred stock. All common share and per common share data in these consolidated financial statements and related notes hereto have been retroactively adjusted to account for the effect of the reverse stock splits for all periods presented prior to December 31, 2012. The total number of authorized common and preferred shares and the par value thereof was not changed by the split. | |
Preferred Stock Issuable for Subscriptions | |
During the nine months ended September 30, 2013, the Company entered into subscription agreements for 114,662,035 shares of its Series A preferred stock to be issued for a total of $361,500. $248,000 cash was received for 74,812,035 shares, $15,000 of loans from related parties was converted into 7,500,000 shares, $60,500 of accrued salaries was converted into 27,500,000. As of September 30, 2013, there were 17,000,000 shares of Series A preferred stock, representing $49,000, remaining to be issued. | |
During the year ended December 31, 2012, the Company issued 1,500 shares of series B preferred stock in a private placement for a total of $1,500,000 ($1,000 per share). During the nine months ended September 30, 2013, $20,000 of the subscription receivable was received in cash. | |
Preferred Stock Issued in Conversion of Debt | |
During the nine months ended September 30, 2013, the Company issued 8,333,333 shares of Series A preferred stock in the conversion of $100,000 of notes payable to related parties (see Note 4 – Related Parties). | |
During the nine months ended September 30, 2013, the Company issued 8,333,333 shares of Series A preferred stock in the conversion of $100,000 of accrued salaries. | |
Preferred Stock Issued in Conversion of Common Stock | |
During the nine months ended September 30, 2013, the Company issued 164,286 shares of Series A preferred stock to an unrelated party for the conversion and return of 6,572 shares of common stock. | |
Common Stock Issuable for Subscriptions | |
During the nine months ended September 30, 2013, the Company entered into subscription agreements for 19,750,000 shares of its common stock to be issued for a total of $14,000. | |
Common Stock Purchased for Cash | |
During the nine months ended September 30, 2013, the Company purchased 1,500 shares of its common stock from a shareholder for $5,000 ($3.33 per share). | |
Common Stock Issued for Cash | |
During the nine months ended September 30, 2013, the Company issued 10,000,000 shares of its common stock to a director for $20,000 ($0.002 per share) (see Note 4 – Related Parties). | |
Common Stock Issued in Conversion of Debt | |
During the nine months ended September 30, 2013, the Company issued 1,210,999,766 shares of common stock in the conversion of $219,158 of notes payable to unrelated parties (see Note 3 – Loans Payable). | |
During the nine months ended September 30, 2013, the Company issued 101,300,000 shares of common stock, with a market value of $113,000, to Ironridge in settlement of $173,730 of amounts payable in common stock (see Note 5 – Amounts Payable in Common Stock and Derivative Liability). | |
Common Stock Issued for Services | |
During the nine months ended September 30, 2013, the Company issued 1,319,444 shares of common stock to two unrelated parties for services of $12,900, or an average price of $0.01 per share based on the fair value of the shares at the time of issuance. | |
Common Stock Issued in Conversion of Preferred Stock | |
During the nine months ended September 30, 2013, the Company issued 6,219,000 shares of common stock to unrelated parties for the conversion and return of 39,050 shares of Series A preferred stock resulting in a reduction in the acquisition liability related to the RP Share Exchange Agreement with the shareholders of Rogue Paper of $23,123. |
7_Commitments_and_Contingencie
7. Commitments and Contingencies | 9 Months Ended | ||||||
Sep. 30, 2013 | |||||||
Commitments And Contingencies | ' | ||||||
NOTE 7 - Commitments and Contingencies | ' | ||||||
Operating Leases | |||||||
The Company leases its office facilities in Marietta, Georgia. The term of the lease is 66 months with escalating lease payments beginning at $2,163 per month. At September 30, 2013, future minimum lease payments under the lease are as follows: | |||||||
2013 | 6,684 | ||||||
2014 | 27,550 | ||||||
2015 | 28,366 | ||||||
2016 | 29,219 | ||||||
2017 | 15,054 | ||||||
$ | 106,873 | ||||||
Rent expense was $22,946 and $26,920 for the nine months ended September 30, 2013 and 2012, respectively. | |||||||
Acquisition Liabilities | |||||||
Pursuant to the RP Share Exchange Agreement with Rogue Paper, Inc., commencing six months from October 23, 2011 (the “Execution Date”), both the Company and the holders of the Preferred Shares shall have the option to redeem any portion of such holders Preferred Shares for cash, at a price of sixty cents ($0.60) per share, or $1,075,000. Commencing twenty four (24) months from the Execution date, holders of the remaining forty-nine percent (49%) of Rogue Paper Common Shares, have the option to have such shares redeemed by the Company for cash, at a price of $0.03 per share, or $29,973. During the nine months ended September 30, 2013, the Company issued 6,219,000 shares of common stock to unrelated parties for the conversion and return of 39,050 shares of Series A preferred stock resulting in a reduction in the acquisition liability of $23,123. | |||||||
License Agreements | |||||||
On October 5, 2011, the Company entered into a license with BBGN&K LLC (“BBGN&K”) for the rights to use certain patented technologies of BBGN&K. The license agreement calls for royalty payments beginning in 2012 of 8% of the revenue generated from the use of the license, to be paid quarterly. Royalty expense was $4,013 and $43,575 for the nine months ended September 30, 2013 and 2012, respectively. | |||||||
On August 5, 2012, the Company entered into a license agreement with Web Asset, LLC (“Web Asset”) for the rights to use certain social media concept and idea created by Mr. Kayode Aladesuyi. The license agreement calls for royalty payments of 49% of the revenues earned by the Company in its use of the social media concept after the Company has earned its first $2,000,000 of revenue, payable quarterly. No royalty payments have been made as of September 30, 2013. |
8_Subsequent_Events
8. Subsequent Events | 9 Months Ended |
Sep. 30, 2013 | |
Subsequent Events [Abstract] | ' |
NOTE 8 - Subsequent Events | ' |
On October 9, 2013, the Company issued 2,500,000 shares of its series A preferred stock in to Anis Sherali, a director of the Company, for $5,000 cash. | |
On October 21, 2013, the Company issued 148,154,000 shares of its common stock in conversion of loans payable in the amount of $7,408. | |
On October 22, 2013, the Company issued 147,048,592 shares of its common stock in conversion of loans payable in the amount of $7,352. | |
On October 23, 2013, the Company issued 173,185,200 shares of its common stock in conversion of loans payable in the amount of $8,533. | |
On October 25, 2013, the Company issued a $3,500 unsecured convertible promissory note to Robert Saidel. The note bears interest at 7% per annum and is due April 25, 2014. | |
On October 31, 2013, the Company issued a $20,000 unsecured convertible promissory note to CJ Mosley. The note includes flat interest of $1,800, is due April 28, 2014, and is convertible at a 30% discount to the current market trading price as of the conversion date. | |
On October 31, 2013, the Company issued 3,750,000 shares of its series A preferred stock in to Anis Sherali, a director of the Company, for $7,500 cash. | |
On November 1, 2013, the Company issued 107,010,674 shares of its common stock in conversion of loans payable in the amount of $5,351. | |
The Company has evaluated subsequent events through the date the financial statements were issued and filed with Securities and Exchange Commission. The Company has determined that there are no other events that warrant disclosure or recognition in the financial statements. |
1_Nature_of_Business_Presentat1
1. Nature of Business, Presentation, and Going Concern (Policies) | 9 Months Ended |
Sep. 30, 2013 | |
Nature Of Business Presentation And Going Concern Policies | ' |
Organization | ' |
Organization | |
EarthSearch Communications International, Inc. (“EarthSearch”) was founded in November 2003 as a Georgia corporation. The company subsequently re-incorporated in Delaware on July 8, 2005. | |
On December 18, 2009, East Coast Diversified Corporation's (“ECDC” or the “Company”) former principal stockholders, Frank Rovito, Aaron Goldstein and Green Energy Partners, LLC (collectively the “Sellers”), entered into a Securities Purchase Agreement (the "Purchase Agreement") with Kayode Aladesuyi (the “Buyer”), pursuant to which the Sellers, beneficial owners of an aggregate of 6,997,150 shares of the Company's common stock (the “Sellers' Shares”), agreed to sell and transfer the Sellers' Shares to the Buyer for an aggregate of Three Hundred Thousand Dollars ($300,000.00). The Purchase Agreement also provided that the Company would enter into a share exchange agreement with EarthSearch. | |
On January 15, 2010, the Company entered into a share exchange agreement (the “Share Exchange Agreement”) with EarthSearch, pursuant to which the Company agreed to issue 35,000,000 shares of the Company's restricted common stock to the shareholders of EarthSearch. On April 2, 2010, EarthSearch consummated all obligations under the Share Exchange Agreement. In accordance with the terms and provisions of the Share Exchange Agreement, the Company acquired 93.49% of the issued and outstanding common stock of EarthSearch. As a result of the Purchase Agreement and Share Exchange Agreement, our principal business became the business of EarthSearch. The Board of Directors of the Company (the “Board”) passed a resolution electing the new members of the Board and appointing new management of the Company and effectively resigning as their last order of business. | |
The Share Exchange was accounted for us as an acquisition and recapitalization. EarthSearch is the acquirer for accounting purposes and, consequently, the assets and liabilities and the historical operations that are reflected in the consolidated financial statements herein are those of EarthSearch. The accumulated deficit of EarthSearch was also carried forward after the acquisition. | |
On December 31, 2012, the Company acquired 1,800,000 additional shares of EarthSearch from a non-controlling shareholder in exchange for 439,024 shares of the Company's common stock. As of December 31, 2012, the Company owns 94.66% of the issued and outstanding stock of EarthSearch. | |
On October 23, 2011, the Company entered into a Share Exchange Agreement (the “RP Share Exchange Agreement”) with Rogue Paper, Inc., a California corporation (“Rogue Paper”), and shareholders of Rogue Paper (the “Rogue Paper Holders”). Rogue Paper is headquartered in San Francisco, California and is a developer of mobile and branded applications for major media enterprises. The Company acquired fifty-one percent (51%) of the issued and outstanding common stock of Rogue Paper in exchange for 2,500,000 shares of the Company’s Series A convertible preferred stock (the “Series A Preferred”). | |
Pursuant to the RP Share Exchange Agreement, no sooner than twelve months from the Effective Date, the Series A Preferred shares shall be convertible, at the option of the holder of such shares, into an aggregate of fifty million shares of the Company’s common stock, par value $0.001 per share. Beginning sixth months from the Effective Date, both the Company and holders of the Series A Preferred shares shall have the option to redeem any portion of such holders’ Series A Preferred shares, for cash, at a price of sixty cents ($0.60) per share. Additionally, commencing twenty-four (24) months from the Effective Date, the holders of the remaining, unsold shares of Rogue Paper common stock may require the Company to redeem such shares, for cash, at a price of three cents ($0.03) per share. During the fourth quarter of 2012, the management of Rogue Paper effectively shut-down operations, denied the Company access to financial records, refused to participate in shareholder or management meetings and all members of Rogue management resigned January 25, 2013. No legal action has been taken by either Rogue Paper or the Company. As financial records have not been available since September 30, 2012, the Company has treated the balance sheets and results of operations of Rogue Paper as a discontinued operation. | |
On January, 12, 2012, StudentConnect Inc., a Georgia corporation, was formed as a subsidiary of the Company. | |
On July, 4, 2012, WetWinds Inc., a Georgia corporation, was formed as a subsidiary of the Company. | |
Nature of Operations | ' |
Nature of Operations | |
The Company is a holding company for several subsidiaries offering products and services in several areas of technology. EarthSearch Communications is a Logistics and Asset Management Company. The Company has created an integration of Radio Frequency Identification Technology (“RFID”) and GPS technology and is an international provider of supply chain management solutions offering real-time visibility in the supply chain with integrated RFID/GPS and other telemetry products. These solutions help businesses worldwide to increase asset management, provide safety and security, increase productivity, and deliver real-time visibility of the supply chain through automation. | |
StudentConnect provides school transportation technology that would allow parents to receive real time notification about the status of their children. The company utilizes wireless communication between GPS and RFID to provide these services. The product is provided to schools and parents at zero cost. The Company’s business model allows it to charge business advertisers who sponsor alerts and messages to parents receiving the messages. | |
Wetwinds launched Vir2o, its social media platform, on April 5, 2012, and has commenced marketing of the platform to users globally. The Company offers users a community newsfeed, messaging module, profile wall and private rooms to share content with friends and families. Each user will have their own private photo, music, movie, game ecommerce rooms. Users can privately or publicly share content in these rooms with their friends and family. We also provide the interactive “JoinMe” technology that allows users and friends to engage in meaningful social activities online. All of our revenue from Vir2o will be advertisement driven. | |
Rogue Paper, Inc. (“Rogue Paper”), the Company’s majority owned subsidiary, offers second screen technology to the media organizations and businesses. During the fourth quarter of 2012, the management of Rogue Paper effectively shut-down operations, denied the Company access to financial records, refused to participate in shareholder or management meetings and all members of Rogue management resigned on January 25, 2013. No legal action has been taken by either Rogue Paper or the Company. As financial records have not been available since September 30, 2012, the Company has treated the balance sheets and results of operations of Rogue Paper as a discontinued operation. | |
Basis of Presentation | ' |
The accompanying unaudited consolidated financial statements have been prepared in accordance with accounting principles generally accepted in The United States of America (“U.S. GAAP”) and the rules and regulations of the Securities and Exchange Commission (“SEC”) for interim financial information. Accordingly, they do not include all of the information and footnotes required in annual financial statements. In the opinion of management, the unaudited financial statements contain all adjustments (consisting only of normal recurring accruals) necessary to present fairly the financial position and results of operations and cash flows. All intercompany transactions and accounts have been eliminated in consolidation. The results of operations presented are not necessarily indicative of the results to be expected for any other interim period or for the entire year. | |
These unaudited consolidated financial statements should be read in conjunction with our 2012 annual consolidated financial statements included in our annual report on Form 10-K, filed with the SEC on April 16, 2013. | |
Going Concern | ' |
Going Concern | |
The accompanying unaudited consolidated financial statements have been prepared on a going concern basis, which contemplates the realization of assets and the satisfaction of liabilities in the normal course of business. As reflected in the accompanying unaudited consolidated financial statements, the Company had an accumulated deficit of $20,570,624 at September 30, 2013, a net loss and net cash used in operations of $1,758,516 and $669,789, respectively, for the nine months ended September 30, 2013. These conditions raise substantial doubt about the Company’s ability to continue as a going concern. | |
The ability of the Company to continue as a going concern is dependent upon the Company’s ability to further implement its business plan, generate revenues, and continue to raise additional investment capital. No assurance can be given that the Company will be successful in these efforts. | |
The unaudited consolidated financial statements do not include any adjustments relating to the recoverability and classification of recorded asset amounts or the amounts and classification of liabilities that might be necessary should the Company be unable to continue as a going concern. Management believes that actions presently being taken to obtain additional funding and implement its strategic plans will afford the Company the opportunity to continue as a going concern. | |
Reclassifications | ' |
Certain items on the statements of operations for the three and nine months ended September 30, 2012 and statement of cash flows for the nine months ended September 30, 2012 have been reclassified to conform to current period presentation. | |
Concentration of Credit Risk | ' |
The Company grants unsecured credit to commercial and governmental customers in the United States and abroad. Accounts receivable are recorded at the invoiced amount, net of an allowance for doubtful accounts. As of September 30, 2013 and December 31, 2012, two customers account for 70% and 79% of the total accounts receivable, respectively. | |
The allowance for doubtful accounts is the Company’s best estimate of the amount of probable credit losses in the Company’s existing accounts receivable. The Company determines the allowance based on historical write-off experience, customer specific facts and economic conditions. Bad debt expense was $nil and $311,671 for the nine months ended September 30, 2013 and 2012, respectively. At September 30, 2013 and December 31, 2012, the allowance for doubtful accounts was $604,735. | |
Outstanding account balances are reviewed individually for collectability. Account balances are charged off against the allowance after all means of collection have been exhausted and the potential for recovery is considered remote. The Company does not have any off-balance sheet credit exposure to its customers. |
2_Disputed_Subsidiary_Tables
2. Disputed Subsidiary (Tables) | 9 Months Ended | ||||||||
Sep. 30, 2013 | |||||||||
Disputed Subsidiary | ' | ||||||||
Results of Rogue Paper included in the income (loss) from disputed subsidiary | ' | ||||||||
The following table shows the results of Rogue Paper included in the income (loss) from disputed subsidiary: | |||||||||
Nine Months Ended September 30, | |||||||||
2013 | 2012 | ||||||||
Revenue | $ | – | $ | 322,000 | |||||
Operating expenses: | |||||||||
Cost of revenue | – | 135,221 | |||||||
Selling, general and administrative expenses | – | 267,543 | |||||||
Amortization of intangible assets | – | – | |||||||
Total operating expenses | – | 402,764 | |||||||
Income (loss) from disputed subsidiary | – | (80,764 | ) | ||||||
Other expenses: | |||||||||
Other income | – | (44 | ) | ||||||
Net loss attributable to noncontrolling interests | – | (39,553 | ) | ||||||
Net income (loss) from loss from disputed subsidiary | $ | – | $ | (41,167 | ) | ||||
Major classes of assets and liabilities of disputed subsidiary on the balance sheet | ' | ||||||||
The major classes of assets and liabilities of disputed subsidiary on the balance sheet are as follows: | |||||||||
September 30, | December 31, | ||||||||
2013 | 2012 | ||||||||
ASSETS | |||||||||
Current assets: | |||||||||
Cash | $ | 70,951 | $ | 70,951 | |||||
Accounts receivable | 27,480 | 27,480 | |||||||
Prepaid expenses | 1,000 | 1,000 | |||||||
Total current assets | 99,431 | 99,431 | |||||||
Property and equipment, net | 7,840 | 7,840 | |||||||
Total assets of discontinued operations | $ | 107,271 | $ | 107,271 | |||||
LIABILITIES | |||||||||
Current liabilities: | |||||||||
Accounts payable | $ | 11,116 | $ | 11,116 | |||||
Total liabilities of discontinued operations | $ | 11,116 | $ | 11,116 |
3_Loans_Payable_Tables
3. Loans Payable (Tables) | 9 Months Ended | ||||||||
Sep. 30, 2013 | |||||||||
Loans Payable Tables | ' | ||||||||
Loans payable | ' | ||||||||
Loans payable at September 30, 2013 and December 31, 2012 consist of the following: | |||||||||
September 30, | December 31, | ||||||||
2013 | 2012 | ||||||||
Unsecured $30,000 convertible note payable to Hanover Holdings I, LLC, which bears interest at 12% per annum and due October 17, 2012. During the year ended December 31, 2012, $28,000 of the note balance was converted to common stock. During the nine months ended September 30, 2013, $2,000 of the note was converted to common stock. Accrued interest is equal to $2.905 and $2,750 at September 30, 2013 and December 31, 2012, respectively. This note is in default at September 30, 2013. | $ | 2,905 | $ | 4,750 | |||||
On February 17, 2012, Panache Capital, LLC entered into an agreement to purchase $50,000 of the note payable to Azfar Haque. The Company exchange the original note to Mr. Haque with a new note to Pananche which bears interest at 10% per annum and due February 17, 2013. During the year ended December 31, 2012, $44,348 of the note was converted to common stock. Accrued interest is equal to $1,254 and $786 at September 30, 2013 and December 31, 2012, respectively. This note is in default at September 30, 2013. | 6,906 | 6,438 | |||||||
Unsecured $70,000 convertible note payable to Hanover Holdings I, LLC, which bears interest at 12% per annum and due October 24 2013. The note is discounted for its unamortized beneficial conversion feature of $2,228 and $27,575 at September 30, 2013 and December 31, 2012, respectively. Accrued interest is equal to $14,127 and $7,309 at September 30, 2013 and December 31, 2012, resepctively. | 81,899 | 49,734 | |||||||
In February 2012, Magna Group, LLC entered into two agreements to purchase a total of $275,000 of the note payable to Azfar Haque. The Company exchanged the original note to Mr. Haque with new notes to Magna which bear interest at 12% per annum and due February 24, 2013. During the year ended December 31, 2012, the entire note balance, including accrued interest of $600, totaling $275,600 was converted to common stock. | – | – | |||||||
Unsecured conversion feature of $-0- and $4,492 at September 30, 2013 and December 31, 2012. Accrued interest is equal to $2,833 and $1,297 at September 30, 2013 and December 31, 2012, respectively. This note is in default at September 30, 2013.$16,000 convertible note payable to Hanover Holdings I, LLC, which bears interest at 12% per annum and due May 3, 2013. The note is discounted for its unamortized beneficial | 18,833 | 12,805 | |||||||
Unsecured $10,000 convertible note payable to Hanover Holdings I, LLC, which bears interest at 12% per annum and due January 3, 2013. The note is discounted for its unamortized beneficial conversion feature of $-0- and $535 at September 30, 2013 and December 31, 2012, respectively. During the nine months ended September 30, 2013, the note balance of $10,952. including accrued interest, was converted to common stock. Accrued interest is equal to $766 at December 31, 2012. | – | 10,231 | |||||||
Unsecured $3,000 convertible note payable to Hanover Holdings I, LLC, which bears interest at 12% per annum and due January 21, 2013. During the nine months ended September 30, 2013, the note, including accrued interest of $1,770, was converted to common stock. | – | 3,013 | |||||||
Unsecured $12,000 convertible note payable to Hanover Holdings I, LLC, which bears interest at 12% per annum and due February 5, 2013. During the nine months ended September 30, 2013, $6,210 of the note was converted to common stock. The note is discounted for its unamortized beneficial conversion feature of $-0- and $1,433 at September 30, 2013 and December 31, 2012, respectively. Accrued interest is equal to $1,795 amd $839 at September 30, 2013 and December 31, 2012, respectively. This note is in default at September 30, 2013. | 7,585 | 11,406 | |||||||
September 30, | December 31, | ||||||||
2013 | 2012 | ||||||||
Unsecured $32,500 convertible note payable to Asher Enterprises, Inc., which bears interest at 8% per annum and due February 25, 2012. During the year ended December 31, 2012, $12,000 of the note was converted to common stock. During the nine months ended September 30, 2013, the remaining $21,800 was converted to common stock. The note is discounted for its unamortized beneficial conversion feature of $3,092 at December 31, 2012. Accrued interest is equal to $1,600 at December 31, 2012. | – | 19,008 | |||||||
On November 2, 2011, the Company entered into a Unsecured Convertible Promissory Note Agreement with Bulldog Insurance for up to $250,000, which bears interest at 8% per annum. On May 10, 2012, the Company received $3,200, which is due December 31, 2012. During the year ended December 31, 2012, the reamining balance of the note including accrued interest totalling $3,262 was purchased by StarCity Capital, LLC. | – | – | |||||||
On November 2, 2011, the Company entered into a Unsecured Convertible Promissory Note Agreement with Bulldog Insurance for up to $250,000, which bears interest at 8% per annum. On June 7, 2012, the Company received $2,500, which is due December 31, 2012. During the year ended December 31, 2012, the reamining balance of the note including accrued interest totalling $2,540 was purchased by StarCity Capital, LLC. | – | – | |||||||
On November 2, 2011, the Company entered into a Unsecured Convertible Promissory Note Agreement with Bulldog Insurance for up to $250,000, which bears interest at 8% per annum. On June 12, 2012, the Company received $9,500, which is due December 31, 2012. During the year ended December 31, 2012, the reamining balance of the note including accrued interest totalling $9,643 was purchased by StarCity Capital, LLC. | – | – | |||||||
Unsecured $5,500 convertible note payable to Hanover Holdings I, LLC, which bears interest at 12% per annum and due March 6, 2013. During the nine months ended September 30, 2013, the note balance of $6,050 was converted to common stock. The note is discounted for its unamortized beneficial conversion feature of $1,099 at December 31, 2012. Accrued interest is equal to $328 at December 31, 2012. | – | 4,729 | |||||||
Unsecured $42,500 convertible note payable to Asher Enterprises, Inc., which bears interest at 8% per annum and due April 19, 2013. During the nine months ended September 30, 2013, the entire balance of the note in the amount of $44,200 was converted to common stock. The note is discounted for its unamortized beneficial conversion feature of $13,379 at December 31, 2012. Accrued interest is equal to $1,579 at December 31, 2012. | – | 30,700 | |||||||
Unsecured $15,000 convertible note payable to Hanover Holdings I, LLC, which bears interest at 12% per annum and due March 26, 2013. The note is discounted for its unamortized beneficial conversion feature of $-0- and $3,484 at September 30, 2013 and December 31, 2012, respectively. Accrued interest is equal to $2,209 and $794 at September 30, 2013 and December 31, 2012, respectively. This note is in default at September 30, 2013. | 17,209 | 12,310 | |||||||
September 30, | December 31, | ||||||||
2013 | 2012 | ||||||||
On November 2, 2011, the Company entered into a Unsecured Convertible Promissory Note Agreement with Bulldog Insurance for up to $250,000, which bears interest at 8% per annum. On August 3, 2012, the Company received $18,350, which was due March 31, 2013. The draw on the note is discounted for its unamortized beneficial conversion feature of $2,741 at December 31, 2012. During the year ended December 31, 2012, $516 of the note was purchased by StarCity Capital, LLC. During the nine months ended September 30, 2013, the note balance of $19,168 was purchased by Tangiers Investment Group, LLC. Accrued interest is equal to $381 at December 31, 2012. | – | 15,474 | |||||||
On November 2, 2011, the Company entered into a Unsecured Convertible Promissory Note Agreement with Bulldog Insurance for up to $250,000, which bears interest at 8% per annum. On August 20, 2012, the Company received $10,000, which was due March 31, 2013. The draw on the note is discounted for its unamortized beneficial conversion feature of $1,514 at December 31, 2012. During the nine months ended September 30, 2013, the note balance of $10,300 was purchased by SGI Group, LLC. Accrued interest is equal to $183 at December 31, 2012. | – | 8,669 | |||||||
On November 2, 2011, the Company entered into a Unsecured Convertible Promissory Note Agreement with Bulldog Insurance for up to $250,000, which bears interest at 8% per annum. On August 27, 2012, the Company received $40,000, which was due March 31, 2013. The draw on the note is discounted for its unamortized beneficial conversion feature of $7,143 at December 31, 2012. During the nine months ended September 30, 2013, the note balance of $40,000 was purchased by WHC Capital, LLC. Accrued interest is equal to $699 at December 31, 2012. | – | 33,556 | |||||||
Unsecured $10,000 convertible note payable to Southridge Partners II LP, which bears interest at 5% per annum and due March 31, 2013. During the nine months ended September 30, 2013, the note, including accrued interest of $399, was converted to common stock. | – | 8,097 | |||||||
On November 2, 2011, the Company entered into a Unsecured Convertible Promissory Note Agreement with Bulldog Insurance for up to $250,000, which bears interest at 8% per annum. On September 5, 2012, the Company received $4,100, which was due March 31, 2013. The draw on the note is discounted for its unamortized beneficial conversion feature of $891 at December 31, 2012. During the nine months ended September 30, 2013, the note balance of $4,264 was purchased by Tangiers Investment Group, LLC. Accrued interest is equal to $66 at December 31, 2012. | – | 3,275 | |||||||
Unsecured $40,000 convertible note payable to Southridge Partners II LP, which bears interest at 5% per annum and due March 31, 2013. The note is discounted for its unamortized beneficial conversion feature of $-0- and $6,154 at September 30, 2013 and December 31, 2012, respectively. Accrued interest is equal to $3,384 and $925 at September 30, 2013 and December 31, 2012, respectively. This note is in default at September 30, 2013. | 43,384 | 34,771 | |||||||
Unsecured $15,000 note payable to SC Advisors, Inc., which bears interest at 8% per annum and due June 30, 2013. Accrued interest is equal to $1,218 and $299 at September 30, 2013 and December 31, 2012, respectively. This note is in default at September 30, 2013. | 16,218 | 15,299 | |||||||
September 30, | December 31, | ||||||||
2013 | 2012 | ||||||||
Unsecured $10,000 convertible note payable to Southridge Partners II LP, which bears interest at 8% per annum and due June 30, 2013. During the nine months ended September 30, 2013, the note, including accrued interest, was converted to common stock. The note is discounted for its unamortized beneficial conversion feature of $6,704 at December 31, 2012. Accrued interest is equal to $195 at December 31, 2012. | – | 3,491 | |||||||
On November 2, 2011, the Company entered into a Unsecured Convertible Promissory Note Agreement with Bulldog Insurance for up to $250,000, which bears interest at 8% per annum. On October 24, 2012, the Company received $5,000, which is due May 24, 2013. The draw on the note is discounted for its unamortized beneficial conversion feature of $1,456 at December 31, 2012. During the nine months ended September 30, 2013, the note balance of $5,169 was purchased by Tangiers Investment Group, LLC. Accrued interest is equal to $75 at December 31, 2012. | – | 3,619 | |||||||
Unsecured $39,647 note payable to Azfar Hague, which bears interest at 9% per annum and due April 25, 2013. $20,000 of this note was purchased by Tangiers Investment Group, LLC on July 26, 2013. Accrued interest is equal to $2,933 and $655 at September 30, 2013 and December 31, 2012, respectively. This note is in default at September 30, 2013. | 22,580 | 40,302 | |||||||
Unsecured $15,000 note payable to SC Advisors, Inc., which bears interest at 8% per annum and due June 30, 2013. Accrued interest is equal to $1,096 and $181 at September 30, 2013 and December 31, 2012, respectively. This note is in default at September 30, 2013. | 16,096 | 15,181 | |||||||
Unsecured $7,000 convertible note payable to Southridge Partners II LP, which bears interest at 8% per annum and due September 30, 2013. During the nine months ended September 30, 2013, the note, including accrued interest, was converted to common stock. The note is discounted for its unamortized beneficial conversion feature of $5,415 at December 31, 2012. Accrued interest is equal to $81 at December 31, 2012. | – | 1,666 | |||||||
Unsecured $32,500 convertible note payable to Asher Enterprises, Inc., which bears interest at 8% per annum and due August 13, 2013. During the nine months ended September 30, 2013, $3,300 of the note was converted to common stock. The note is discounted for its unamortized beneficial conversion feature of $-0- and $24,932 at September 30, 2013 and December 31, 2012, respectively. Accrued interest is equal to $2,285 and $370 at September 30, 2013 and December 31, 2012, respectively. This note is in default at September 30, 2013. | 31,485 | 7,938 | |||||||
On November 2, 2011, the Company entered into a Unsecured Convertible Promissory Note Agreement with Bulldog Insurance for up to $250,000, which bears interest at 8% per annum. On November 15, 2012, the Company received $10,000, which was due May 15, 2013. The draw on the note is discounted for its unamortized beneficial conversion feature of $3,309 at December 31, 2012. During the nine months ended September 30, 2013, the note was purchased by WHC Capital, LLC. Accrued interest is equal to $109 at December 31, 2012. | – | 7,150 | |||||||
Unsecured $18,000 convertible note payable to Southridge Partners II LP, which bears interest at 8% per annum and due June 30, 2013. During the nine months ended September 30, 2013, $14,471 of the note was converted to common stock. The note is discounted for its unamortized beneficial conversion feature of $-0- and $15,296 at September 30, 2013 and December 31, 2012, respectively. Accrued interest is equal to $1,151 and $126 at September 30, 2013 and December 31, 2012, respectively. This note is in default at September 30, 2013. | 4,680 | 2,830 | |||||||
September 30, | December 31, | ||||||||
2013 | 2012 | ||||||||
Unsecured $9,000 convertible note payable to Star City Capital LLC, which bears interest at 12% per annum and due December 3, 2013. The note is discounted for its unamortized beneficial conversion feature of $1,561 and $8,220 at September 30, 2013 and December 31, 2012, respectively. Accrued interest is equal to $907 and $83 at September 30, 2013 and December 31, 2012, respectively. | 8,346 | 863 | |||||||
Unsecured $15,000 note payable to SC Advisors, Inc., which bears interest at 8% per annum and due June 30, 2013. Accrued interest is equal to $1,010 and $99 at September 30, 2013 and December 31, 2012, respectively. This note is in default at September 30, 2013. | 16,010 | 15,099 | |||||||
Unsecured $25,000 convertible note payable to Southridge Partners II LP, which bears interest at 8% per annum and due June 30, 2013. The note is discounted for its unamortized beneficial conversion feature of $-0- and $22,625 at September 30, 2013 and December 31, 2012, respectively. Accrued interest is equal to $1,621 and $104 at September 30, 2013 and December 31, 2012, respectively.. This note is in default at September 30, 2013. | 26,621 | 2,479 | |||||||
On December 12, 2012, Star City Capital LLC entered into an agreement to purchase $19,700 of a note payable to Bulldog Insurance. The note bears interest at 8% per annum and is due on demand. During the nine months ended September 30, 2013, $10,626 of the note was converted to common stock. Accrued interest is equal to $391 and $51 at September 30, 2013 and December 31, 2012, respectively. | 9,698 | 19,751 | |||||||
Unsecured $7,500 convertible note payable to Southridge Partners II LP, which bears interest at 8% per annum and due June 30, 2013. The note is discounted for its unamortized beneficial conversion feature of $-0- and $7,378 at September 30, 2013 and December 31, 2012, respectively. Accrued interest is equal to $459 and $5 at September 30, 2013 and December 31, 2012, respectively. This note is in default at September 30, 2013. | 7,959 | 127 | |||||||
On January 3, 2013, SGI Group, LLC entered into an agreement to purchase $10,300 of notes payable to Bulldog Insurance. The note bears interest at 12% per annum and due on demand. During the nine months ended September 30, 2013, the note, including accrued interest, was converted to common stock. | – | – | |||||||
Unsecured $32,500 convertible note payable to Asher Enterprises, Inc., which bears interest at 8% per annum and due November 1, 2013. The note is discounted for its unamortized beneficial conversion feature of $3,633 at September 30, 2013. Accrued interest is equal to $1,696. | 30,563 | – | |||||||
Unsecured $35,000 convertible note payable to Lucosky Brookman LLP, which bears interest at 12% per annum and due on demand. Accrued interest is equal to $2,319. | 37,319 | – | |||||||
Unsecured $43,922 convertible note payable to Lucosky Brookman LLP, which bears interest at 12% per annum and due on demand. Accrued interest is equal to $2,910. | 46,832 | – | |||||||
September 30, | December 31, | ||||||||
2013 | 2012 | ||||||||
Unsecured $5,000 note payable to James Flowers, which include flat interest of $500 at maturity and due December 1, 2013. $2,000 of the note was repaid during the nine months ended September 30, 2013. Accrued interest is equal to $434. | 3,434 | – | |||||||
Unsecured $32,500 convertible note payable to Asher Enterprises, Inc., which bears interest at 8% per annum and due January 31, 2014. The note is discounted for its unamortized beneficial conversion feature of $13,892 at September 30, 2013. Accrued interest is equal to $1,097. | 19,705 | – | |||||||
Unsecured $7,000 note payable to Andre Fluellen, which include flat interest of $1,500 at maturity and due October 30, 2013. Accrued interest is equal to $1,247. | 8,247 | – | |||||||
Unsecured $18,000 note payable to Bulldog Insurance, which bears interest at 7% per annum and due December 1, 2013. Accrued interest is equal to $504. | 18,504 | – | |||||||
On May 6, 2013, WHC Capital, LLC entered into an agreement to purchase $50,000 of notes payable to Bulldog Insurance. The note bears interest at 8% per annum and is due March 6, 2014. During the nine months ended September 30, 2013, $19,472 of the note was converted to common stock. The note is discounted for its unamortized beneficial conversion feature of $21,128 at September 30, 2013. Accrued interest is equal to $2,704 at September 30, 2013. | 12,104 | – | |||||||
Unsecured $20,000 convertible note payable to WHC Capital, LLC., which bears interest at 8% per annum and due March 9, 2014. The note is discounted for its unamortized beneficial conversion feature of $8,613 at September 30, 2013. Accrued interest is equal to $631. | 12,018 | – | |||||||
Unsecured $20,000 note payable to Robert Saidel, which bears interest at 7% per annum and due December 1, 2013. Accrued interest is equal to $495. | 20,495 | – | |||||||
Unsecured $32,500 convertible note payable to Asher Enterprises, Inc., which bears interest at 8% per annum and due March 3, 2014. The note is discounted for its unamortized beneficial conversion feature of $15,687 at September 30, 2013. Accrued interest is equal to $876. | 17,689 | – | |||||||
Unsecured $7,500 note payable to Andre Fluellen, which include flat interest of $1,400 at maturity and due December 1, 2013. Accrued interest is equal to $926. | 8,426 | – | |||||||
Unsecured $10,000 note payable to Sammie Hill, III, which include flat interest of $2,000 at maturity and due December 15, 2013. Accrued interest is equal to $1,169. | 11,169 | – | |||||||
Unsecured $5,000 convertible note payable to Tangiers Investment Group, LLC., which bears interest at 10% per annum and due June 21, 2014. The note is discounted for its unamortized beneficial conversion feature of $3,616 at September 30, 2013. Accrued interest is equal to $138. | 1,522 | – | |||||||
On June 21, 2013, Tangiers Investment Group, LLC entered into an agreement to purchase $4,264 of notes payable to Bulldog Insurance. The note bears interest at 10% per annum and is due June 21, 2014. During the nine months ended September 30, 2013, the note was converted to common stock. | – | – | |||||||
On June 21, 2013, Tangiers Investment Group, LLC entered into an agreement to purchase $5,169 of notes payable to Bulldog Insurance. The note bears interest at 10% per annum and due June 21, 2014. During the nine months ended September 30, 2013, the note was converted to common stock. | – | – | |||||||
September 30, | December 31, | ||||||||
2013 | 2012 | ||||||||
On June 21, 2013, Tangiers Investment Group, LLC entered into an agreement to purchase $19,168 of notes payable to Bulldog Insurance. The note bears interest at 10% per annum and due June 21, 2014. During the nine months ended September 30, 2013, the note was converted to common stock. | – | – | |||||||
Unsecured $12,000 note payable to Bulldog Insurance, which bears interest at 7% per annum and due December 1, 2013. Accrued interest is equal to $221. | 12,221 | – | |||||||
Unsecured $3,000 note payable to Andre Fluellen, which include flat interest of $500 at maturity and due December 1, 2013. Accrued interest is equal to $292. | 3,292 | – | |||||||
Unsecured $3,000 note payable to Andre Fluellen, which include flat interest of $500 at maturity and due February 22, 2014. Accrued interest is equal to $32. | 3,032 | – | |||||||
Unsecured $14,500 convertible note payable to Asher Enterprises, Inc., which bears interest at 8% per annum and due May 5, 2014. The note is discounted for its unamortized beneficial conversion feature of $10,767 at September 30, 2013. Accrued interest is equal to $165. | 3,898 | – | |||||||
Unsecured $8,500 non-interest bearing note payable to Azfar Hague due February 5, 2014. | 8,500 | – | |||||||
Unsecured $10,000 non-interest bearing note payable to Azfar Hague due February 20, 2014. | 10,000 | – | |||||||
Unsecured $8,500 note payable to Bulldog Insurance, which bears interest at 5% per annum and due February 28, 2014. Accrued interest is equal to $35. | 8,535 | – | |||||||
Unsecured $7,500 note payable to Robert Saidel, which bears interest at 7% per annum and due January 8, 2014. Accrued interest is equal to $121. | 7,621 | – | |||||||
Unsecured $10,000 note payable to Robert Saidel, which bears interest at 7% per annum and due February 16, 2014. Accrued interest is equal to $86. | 10,086 | – | |||||||
Unsecured $4,000 note payable to Robert Saidel, which bears interest at 7% per annum and due March 9, 2014. Accrued interest is equal to $16. | 4,016 | – | |||||||
Unsecured $6,500 convertible note payable to Tangiers Investment Group, LLC., which bears interest at 10% per annum and due July 25, 2014. The note is discounted for its unamortized beneficial conversion feature of $5,306 at September 30, 2013. Accrued interest is equal to $119. | 1,313 | – | |||||||
On July 26, 2013, Tangiers Investment Group, LLC entered into an agreement to purchase $20,000 of notes payable to Azfar Hague. The note bears interest at 10% per annum and is due July 26, 2014. The note is discounted for its unamortized beneficial conversion feature of $16,383 at September 30, 2013. Accrued interest is equal to $362. | 3,979 | – | |||||||
Unsecured $5,000 convertible note payable to Tangiers Investment Group, LLC., which bears interest at 10% per annum and due August 2, 2014. The note is discounted for its unamortized beneficial conversion feature of $4,191 at September 30, 2013. Accrued interest is equal to $81. | 890 | – | |||||||
September 30, | December 31, | ||||||||
2013 | 2012 | ||||||||
On August 2, 2013, Tangiers Investment Group, LLC entered into an agreement to purchase $15,000 of notes payable to Bulldog Insurance. The note bears interest at 10% per annum and is due August 2, 2014. During the nine months ended September 30, 2013, $7,592 of the note was converted to common stock. The note is discounted for its unamortized beneficial conversion feature of $5,075 at September 30, 2013. Accrued interest is equal to $120. | 2,453 | – | |||||||
Unsecured $5,000 convertible note payable to WHC Capital, LLC., which bears interest at 8% per annum and due August 12 2014. The note is discounted for its unamortized beneficial conversion feature of $4,328 at September 30, 2013. Accrued interest is equal to $54. | 726 | – | |||||||
Total Loans Payable | $ | 667,003 | $ | 404,761 |
4_Related_Parties_Tables
4. Related Parties (Tables) | 9 Months Ended | ||||||||
Sep. 30, 2013 | |||||||||
Related Parties Tables | ' | ||||||||
Loans payable related parties | ' | ||||||||
Loans payable – related parties at September 30, 2013 and December 31, 2012 consist of the following: | |||||||||
September 30, | December 31, | ||||||||
2013 | 2012 | ||||||||
Unsecured non-interest bearing notes payable, due on demand, to Frank Russo, a Director of the Company. During the nine months ended September 30, 2013, $60,000 of the note balance was converted to Series A preferred stock. | $ | 300,229 | $ | 354,979 | |||||
Unsecured notes payable to Edward Eppel, a Director of the Company, which bears interest at 10% per annum and is due on demand. During the nine months ended September 30, 2013, $55,000 of the note was converted to Series A preferred stock. Accrued interest is equal to $40,855 and $31,374, respectively. | 199,318 | 184,930 | |||||||
Total | $ | 499,547 | $ | 539,909 |
7_Commitments_and_Contingencie1
7. Commitments and Contingencies (Tables) | 9 Months Ended | ||||||
Sep. 30, 2013 | |||||||
Commitments And Contingencies Tables | ' | ||||||
Future minimum lease payments | ' | ||||||
The Company leases its office facilities in Marietta, Georgia. The term of the lease is 66 months with escalating lease payments beginning at $2,163 per month. At September 30, 2013, future minimum lease payments under the lease are as follows: | |||||||
2013 | 6,684 | ||||||
2014 | 27,550 | ||||||
2015 | 28,366 | ||||||
2016 | 29,219 | ||||||
2017 | 15,054 | ||||||
$ | 106,873 |
1_Nature_of_Business_Presentat2
1. Nature of Business, Presentation, and Going Concern (Details Narrative) (USD $) | 9 Months Ended | 9 Months Ended | 12 Months Ended | ||
Sep. 30, 2013 | Sep. 30, 2012 | Dec. 31, 2012 | Sep. 30, 2013 | Dec. 31, 2012 | |
Accounts Receivable [Member] | Accounts Receivable [Member] | ||||
Customer A | Customer B | ||||
Acquisition of shares percentage | 51.00% | ' | ' | ' | ' |
Accumulated deficit | $20,570,624 | ' | $18,812,108 | ' | ' |
Net loss | 1,758,516 | 3,221,480 | ' | ' | ' |
Net cash used in operation | 669,789 | 1,242,037 | ' | ' | ' |
Bad debt expense | 0 | 311,671 | ' | ' | ' |
Allowance for doubtful accounts | $604,735 | ' | $604,735 | ' | ' |
Concentration of risk | ' | ' | ' | 70.00% | 79.00% |
2_Disputed_Subsidiary_Details
2. Disputed Subsidiary (Details) (USD $) | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2013 | Sep. 30, 2012 | |
Revenue | $106,949 | $66,314 | $169,168 | $710,718 |
Operating expenses: | ' | ' | ' | ' |
Cost of revenue | 6,757 | 10,006 | 20,076 | 48,184 |
Selling, general and administrative expenses | 453,896 | 956,732 | 1,522,806 | 2,529,998 |
Amortization of intangible assets | ' | ' | 37,500 | 37,500 |
Total operating expenses | 530,632 | 1,007,834 | 1,639,374 | 2,911,471 |
Income (loss) from disputed subsidiary | -423,683 | -941,520 | -1,470,206 | -2,200,753 |
Other expenses: | ' | ' | ' | ' |
Net loss attributable to noncontrolling interests | -4,459 | -47,136 | -17,708 | -33,746 |
Net income (loss) from loss from disputed subsidiary | ' | ' | -1,758,516 | -3,221,480 |
Rogue Paper | ' | ' | ' | ' |
Revenue | ' | ' | 0 | 322,000 |
Operating expenses: | ' | ' | ' | ' |
Cost of revenue | ' | ' | 0 | 135,221 |
Selling, general and administrative expenses | ' | ' | 0 | 267,543 |
Amortization of intangible assets | ' | ' | 0 | 0 |
Total operating expenses | ' | ' | 0 | 402,764 |
Income (loss) from disputed subsidiary | ' | ' | 0 | -80,764 |
Other expenses: | ' | ' | ' | ' |
Other income | ' | ' | 0 | -44 |
Net loss attributable to noncontrolling interests | ' | ' | 0 | -39,553 |
Net income (loss) from loss from disputed subsidiary | ' | ' | $0 | ($41,167) |
2_Disputed_Subsidiary_Details_
2. Disputed Subsidiary (Details 1) (USD $) | Sep. 30, 2013 | Dec. 31, 2012 | Sep. 30, 2012 | Dec. 31, 2011 |
Current assets: | ' | ' | ' | ' |
Cash | $368 | $0 | $3,660 | $53,519 |
Accounts receivable | 222,007 | 200,040 | ' | ' |
Prepaid expenses | 23,030 | 15,818 | ' | ' |
Total current assets | 616,100 | 631,906 | ' | ' |
Property and equipment, net | 4,235 | 7,401 | ' | ' |
Total assets of discontinued operations | 690,335 | 746,807 | ' | ' |
Current liabilities: | ' | ' | ' | ' |
Total liabilities of discontinued operations | 4,190,086 | 3,473,706 | ' | ' |
Rogue Paper | ' | ' | ' | ' |
Current assets: | ' | ' | ' | ' |
Cash | ' | 70,951 | 70,951 | ' |
Accounts receivable | ' | 27,480 | 27,480 | ' |
Prepaid expenses | ' | 1,000 | 1,000 | ' |
Total current assets | ' | 99,431 | 99,431 | ' |
Property and equipment, net | ' | 7,840 | 7,840 | ' |
Total assets of discontinued operations | ' | 107,271 | 107,271 | ' |
Current liabilities: | ' | ' | ' | ' |
Accounts payable | ' | 11,116 | 11,116 | ' |
Total liabilities of discontinued operations | ' | $11,116 | $11,116 | ' |
3_Loans_Payable_Details
3. Loans Payable (Details) (USD $) | Sep. 30, 2013 | Dec. 31, 2012 |
Loans payable, current | $667,003 | $404,761 |
Lucosky Brookman LLP One [Member] | ' | ' |
Loans payable, current | 46,832 | 0 |
Robert Saidel [Member] | ' | ' |
Loans payable, current | 20,495 | 0 |
Sammie Hill III [Member] | ' | ' |
Loans payable, current | 11,169 | 0 |
Tangiers Investment Group, LLC | ' | ' |
Loans payable, current | 1,522 | 0 |
Tangiers Investment Group LLC 1 [Member] | ' | ' |
Loans payable, current | 0 | 0 |
Tangiers Investment Group LLC Two [Member] | ' | ' |
Loans payable, current | 0 | 0 |
Tangiers Investment Group LLC Three [Member] | ' | ' |
Loans payable, current | 0 | 0 |
Tangiers Investment Group LLC Four [Member] | ' | ' |
Loans payable, current | 1,313 | 0 |
Tangiers Investment Group LLC Five [Member] | ' | ' |
Loans payable, current | 3,979 | 0 |
Tangiers Investment Group LLC Six [Member] | ' | ' |
Loans payable, current | 890 | 0 |
Tangiers Investment Group LLC Seven [Member] | ' | ' |
Loans payable, current | 2,453 | 0 |
Hanover Holdings I, LLC [Member] | ' | ' |
Loans payable, current | 2,905 | 4,750 |
Azfar Haque [Member] | ' | ' |
Loans payable, current | 6,906 | 6,438 |
Hanover Holdings I, LLC One [Member] | ' | ' |
Loans payable, current | 81,899 | 49,734 |
Magna Group, LLC [Member] | ' | ' |
Loans payable, current | 0 | 0 |
Hanover Holdings I, LLC Two [Member] | ' | ' |
Loans payable, current | 18,833 | 12,805 |
Hanover Holdings I, LLC Three [Member] | ' | ' |
Loans payable, current | 0 | 10,231 |
Hanover Holdings I, LLC Four [Member] | ' | ' |
Loans payable, current | 0 | 3,013 |
Hanover Holdings I, LLC Five [Member] | ' | ' |
Loans payable, current | 7,585 | 11,406 |
Asher Enterprises, Inc [Member] | ' | ' |
Loans payable, current | 0 | 19,008 |
Bulldog Insurance Nine [Member] | ' | ' |
Loans payable, current | 0 | 0 |
Bulldog Insurance Ten [Member] | ' | ' |
Loans payable, current | 0 | 0 |
Bulldog Insurance Eleven [Member] | ' | ' |
Loans payable, current | 0 | 0 |
Hanover Holdings I, LLC Six [Member] | ' | ' |
Loans payable, current | 0 | 4,729 |
Asher Enterprises, Inc One [Member] | ' | ' |
Loans payable, current | 0 | 30,700 |
Hanover Holdings I, LLC Seven [Member] | ' | ' |
Loans payable, current | 17,209 | 12,310 |
Bulldog Insurance [Member] | ' | ' |
Loans payable, current | 0 | 15,474 |
Bulldog Insurance One [Member] | ' | ' |
Loans payable, current | 0 | 8,669 |
Bulldog Insurance Two [Member] | ' | ' |
Loans payable, current | 0 | 33,556 |
Southridge Partners II LP [Member] | ' | ' |
Loans payable, current | 0 | 8,097 |
Bulldog Insurance Three [Member] | ' | ' |
Loans payable, current | 0 | 3,275 |
Southridge Partners II LP One [Member] | ' | ' |
Loans payable, current | 43,384 | 34,771 |
SC Advisors, Inc [Member] | ' | ' |
Loans payable, current | 16,218 | 15,299 |
Southridge Partners II LP Two [Member] | ' | ' |
Loans payable, current | 0 | 3,491 |
Bulldog Insurance Four [Member] | ' | ' |
Loans payable, current | 0 | 3,619 |
Azfar Haque One [Member] | ' | ' |
Loans payable, current | 22,580 | 40,302 |
SC Advisors, Inc One [Member] | ' | ' |
Loans payable, current | 16,096 | 15,181 |
Southridge Partners II LP Three [Member] | ' | ' |
Loans payable, current | 0 | 1,666 |
Asher Enterprises, Inc Two [Member] | ' | ' |
Loans payable, current | 31,485 | 7,938 |
Bulldog Insurance Five [Member] | ' | ' |
Loans payable, current | 0 | 7,150 |
Southridge Partners II LP Four [Member] | ' | ' |
Loans payable, current | 4,680 | 2,830 |
Star City Capital LLC [Member] | ' | ' |
Loans payable, current | 8,346 | 863 |
SC Advisors, Inc Two [Member] | ' | ' |
Loans payable, current | 16,010 | 15,099 |
Southridge Partners II LP Five [Member] | ' | ' |
Loans payable, current | 26,621 | 2,479 |
Star City Capital LLC One [Member] | ' | ' |
Loans payable, current | 9,698 | 19,751 |
Southridge Partners II LP Seven [Member] | ' | ' |
Loans payable, current | 7,959 | 127 |
Asher Enterprises, Inc Four [Member] | ' | ' |
Loans payable, current | 30,563 | 0 |
Lucosky Brookman LLP [Member] | ' | ' |
Loans payable, current | 37,319 | 0 |
James Flower [Member] | ' | ' |
Loans payable, current | 3,434 | 0 |
Asher Enterprises, Inc Five [Member] | ' | ' |
Loans payable, current | 19,705 | 0 |
Andre Fluellen [Member] | ' | ' |
Loans payable, current | 8,247 | 0 |
Bulldog Insurance Six [Member] | ' | ' |
Loans payable, current | 18,504 | 0 |
WHC Capital LLC [Member] | ' | ' |
Loans payable, current | 12,104 | 0 |
WHC Capital LLC One [Member] | ' | ' |
Loans payable, current | 12,018 | 0 |
Asher Enterprises, Inc Six [Member] | ' | ' |
Loans payable, current | 17,689 | 0 |
Andre Fluellen 1 [Member] | ' | ' |
Loans payable, current | 8,426 | 0 |
Bulldog Insurance Seven [Member] | ' | ' |
Loans payable, current | 12,221 | 0 |
Andre Fluellen 2 [Member] | ' | ' |
Loans payable, current | 3,292 | 0 |
Andre Fluellen 3 [Member] | ' | ' |
Loans payable, current | 3,032 | 0 |
Asher Enterprises, Inc Three [Member] | ' | ' |
Loans payable, current | 3,898 | 0 |
Azfar Haque Two [Member] | ' | ' |
Loans payable, current | 8,500 | 0 |
Azfar Haque Three [Member] | ' | ' |
Loans payable, current | 10,000 | 0 |
Bulldog Insurance Eight [Member] | ' | ' |
Loans payable, current | 8,535 | 0 |
Robert Saidel 3 [Member] | ' | ' |
Loans payable, current | 7,621 | 0 |
Robert Saidel 4 [Member] | ' | ' |
Loans payable, current | 10,086 | 0 |
Robert Saidel 5 [Member] | ' | ' |
Loans payable, current | 4,016 | 0 |
WHC Capital LLC Two [Member] | ' | ' |
Loans payable, current | $726 | $0 |
3_Loans_Payable_Details_Narrat
3. Loans Payable (Details Narrative) (USD $) | 9 Months Ended | 12 Months Ended | |
Sep. 30, 2013 | Sep. 30, 2012 | Dec. 31, 2012 | |
Interest expense | $47,144 | ' | $126,284 |
Total borrowings during period | 302,500 | ' | 851,711 |
Repayments made on borrowings | 2,000 | 12,600 | 12,600 |
Series A preferred stock [Member] | ' | ' | ' |
Conversion of loans payable to shares | ' | ' | 1,000,000 |
Conversion of loans payable to value | ' | ' | 57,000 |
Common Stock [Member] | ' | ' | ' |
Conversion of loans payable to shares | 1,210,999,766 | ' | 3,693,754 |
Conversion of loans payable to value | $219,159 | ' | $875,433 |
4_Related_Parties_Details
4. Related Parties (Details) (USD $) | Sep. 30, 2013 | Dec. 31, 2012 |
Loans payable - related parties | $499,547 | $539,909 |
Frank Russo [Member] | ' | ' |
Loans payable - related parties | 300,229 | 354,979 |
Edward Eppel [Member] | ' | ' |
Loans payable - related parties | $199,318 | $184,930 |
4_Related_Parties_Details_Narr
4. Related Parties (Details Narrative) (USD $) | 9 Months Ended | 9 Months Ended | 9 Months Ended | ||||||
Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2013 | Dec. 31, 2012 | Sep. 30, 2013 | Sep. 30, 2013 | Sep. 30, 2013 | Dec. 31, 2012 | Sep. 30, 2013 | |
Edward Eppel [Member] | Edward Eppel [Member] | Kayode Aladesuyi [Member] | Sousa [Member] | Frank Russo [Member] | Frank Russo [Member] | Anis Sherali [Member] | |||
Due to related party | ' | ' | ' | $184,930 | ' | ' | ' | $354,979 | ' |
Borrowed from related party | 65,157 | 56,500 | 59,908 | ' | ' | ' | 5,250 | ' | ' |
Accrued interest | ' | ' | 9,480 | ' | ' | ' | ' | ' | ' |
Accrued salaries | ' | ' | ' | ' | 130,000 | 20,000 | ' | ' | ' |
Accrued board compensation converted into Preferred Stock Series A, amount | 60,500 | ' | 55,000 | ' | ' | ' | 60,000 | ' | 55,000 |
Accrued board compensation converted into Preferred Stock Series A, shares | 27,500,000 | ' | 6,666,667 | ' | 23,333,333 | ' | 9,166,667 | ' | 14,862,035 |
Common stock converted into Series A Preferred stock, common stock converted | ' | ' | 6,666,667 | ' | ' | 10,000,000 | ' | ' | 10,000,000 |
Common stock converted into Series A Preferred stock, common stock converted, Value | ' | ' | ' | ' | ' | ' | ' | ' | $20,000 |
5_Amounts_Payable_in_Common_St1
5. Amounts Payable in Common Stock and Derivative Liability (Details Narrative) (USD $) | 9 Months Ended | 12 Months Ended |
Sep. 30, 2013 | Dec. 31, 2012 | |
Amounts Payable In Common Stock And Derivative Liability Details Narrative | ' | ' |
Change in derivative liability | $5,723 | $12,099 |
Reduction of the derivative liability | 105,270 | 416,441 |
Common stock issued in settlement of debt, shares | 101,300,000 | 1,610,400 |
Common stock issued in settlement of debt, value | 113,000 | 1,201,930 |
Common stock issued in settlement of debt, liability value | $173,730 | $773,390 |
6_Stockholders_Deficit_Details
6. Stockholders' Deficit (Details Narrative) (USD $) | 9 Months Ended | 12 Months Ended |
Sep. 30, 2013 | Dec. 31, 2012 | |
Series A Preferred Stock issued in private placements subscriptions, shares | 114,662,035 | ' |
Series A Preferred Stock issued in private placements subscriptions, value | $361,500 | ' |
Proceeds from issuance of preferred stock | 248,000 | ' |
Number of preferred stock issued | 74,812,035 | ' |
Conversion of related party loan amount | 15,000 | ' |
Conversion of related party loan amount, shares | 7,500,000 | ' |
Accrued board compensation converted into Preferred Stock Series A, amount | 60,500 | ' |
Accrued board compensation converted into Preferred Stock Series A, shares | 27,500,000 | ' |
Series B Preferred Stock issued in private placements, shares | ' | 1,500 |
Series B Preferred Stock issued in private placements, value | ' | 1,500,000 |
Preferred stock series B issued, pershare value | ' | $1,000 |
Common stock for subscription, shares | 19,750,000 | ' |
Common stock for subscription, amount | 14,000 | ' |
Common stock issued for cash, shares | 1,500 | ' |
Common stock issued for cash, value | 5,000 | ' |
Common stock issued, pershare value | $3.33 | ' |
Common Stock Issued for cash to director shares | 10,000,000 | ' |
Common Stock Issued for cash to director Value | 20,000 | ' |
Common Stock Issued for cash to director Per Share | $0.00 | ' |
Common stock issued in settlement of debt, shares | 101,300,000 | 1,610,400 |
Common stock issued in settlement of debt, value | 113,000 | 1,201,930 |
Common stock issued in settlement of debt, liability value | 173,730 | 773,390 |
Common Stock Issued in Conversion of Preferred Stock | 6,219,000 | ' |
Common stock returned | '39,050 | ' |
Reduction in acquisition liability related to Share Exchange Agreement with shareholders of Rogue Paper | 23,123 | ' |
Common Stock Issued for Services, shares | 1,319,444 | ' |
Common Stock Issued for Services, amount | 12,900 | ' |
Common Stock Issued for Services, average price per share | $0.01 | ' |
Series A preferred stock [Member] | ' | ' |
Series A Preferred Stock issued in private placements subscriptions, shares | 8,333,333 | ' |
Series A Preferred Stock issued in private placements subscriptions, value | 100,000 | ' |
Conversion of related party loan amount, shares | 8,333,333 | ' |
Accrued board compensation converted into Preferred Stock Series A, amount | 100,000 | ' |
Common stock issued for cash, shares | 6,572 | ' |
Common stock issued for cash, value | 164,286 | ' |
Conversion of loans payable to shares | ' | 1,000,000 |
Conversion of loans payable to value | ' | 57,000 |
Common Stock [Member] | ' | ' |
Conversion of loans payable to shares | 1,210,999,766 | 3,693,754 |
Conversion of loans payable to value | 219,159 | 875,433 |
Remains to be received [Member] | ' | ' |
Series A Preferred Stock issued in private placements subscriptions, shares | 17,000,000 | ' |
Series A Preferred Stock issued in private placements subscriptions, value | $49,000 | ' |
UnrelatedPartyMember | PreferredStockIssuedinConversionofCommonStockMember | ' | ' |
Common stock returned | '39,050 | ' |
7_Commitments_and_Contingencie2
7. Commitments and Contingencies (Details) (USD $) | Sep. 30, 2013 |
Commitments And Contingencies Details | ' |
2013 | $6,684 |
2014 | 27,550 |
2015 | 28,366 |
2016 | 29,219 |
2017 | 15,054 |
Total | $106,873 |
7_Commitments_and_Contingencie3
7. Commitments and Contingencies (Details Narrative) (USD $) | 9 Months Ended | |
Sep. 30, 2013 | Sep. 30, 2012 | |
Commitments And Contingencies Details Narrative | ' | ' |
Rent expense | $22,946 | $26,920 |
Common Stock Issued in Conversion of Preferred Stock | 6,219,000 | ' |
Common stock returned | '39,050 | ' |
Reduction in acquisition liability related to Share Exchange Agreement with shareholders of Rogue Paper | $23,123 | ' |