Document And Entity Information
Document And Entity Information - shares | 9 Months Ended | |
May. 31, 2015 | Jul. 14, 2015 | |
Entity Registrant Name | Location Based Technologies, Inc. | |
Entity Central Index Key | 1,383,196 | |
Current Fiscal Year End Date | --08-31 | |
Entity Filer Category | Smaller Reporting Company | |
Entity Current Reporting Status | Yes | |
Entity Voluntary Filers | No | |
Entity Well-known Seasoned Issuer | No | |
Entity Common Stock, Shares Outstanding (in shares) | 277,530,645 | |
Document Type | 10-Q | |
Document Period End Date | May 31, 2015 | |
Document Fiscal Year Focus | 2,015 | |
Document Fiscal Period Focus | Q3 | |
Amendment Flag | false |
Condensed Consolidated Balance
Condensed Consolidated Balance Sheets (Unaudited) - Scenario, Unspecified [Domain] - USD ($) | May. 31, 2015 | Aug. 31, 2014 |
Convertible Term Notes Payable and Accrued Interest [Member] | ||
CURRENT LIABILITIES | ||
Convertible demand notes payable and accrued interest | $ 5,217,111 | $ 3,100,361 |
Convertible term notes payable and accrued interest, net of unamortized discounts | $ 5,217,111 | 3,100,361 |
Convertible term notes payable | 843,787 | |
Related Party Convertible Demand Notes Payable and Accrued Interest [Member] | ||
CURRENT LIABILITIES | ||
Related party convertible demand notes payable and accrued interest | $ 3,048,815 | 106,986 |
Related party convertible term notes payable and accrued interest, net of unamortized discounts | 3,048,815 | 106,986 |
Related party convertible term notes payable and accrued interest, net of unamortized discounts | 1,285,352 | 2,820,106 |
Cash and cash equivalents | 236,994 | 146,200 |
Accounts receivable, net of allowances | 188,348 | 78,422 |
Inventory, Net | 685,034 | 793,332 |
Prepaid expenses and other assets | $ 18,940 | 45,062 |
Deferred financing costs | 5,506 | |
Total current assets | $ 1,129,316 | 1,068,522 |
Property and equipment, net of accumulated depreciation | 34,507 | 65,817 |
Intangible assets, net of accumulated amortization | 544,887 | 596,977 |
Inventory, net of reserves | 368,617 | 565,146 |
Deposits | 30,000 | 30,000 |
Total other assets | 943,504 | 1,192,123 |
TOTAL ASSETS | 2,107,327 | 2,326,462 |
Convertible demand notes payable and accrued interest | 29,615 | 30,163 |
Related party convertible demand notes payable and accrued interest | 1,273,407 | 1,192,187 |
Accounts payable and accrued expenses | 1,878,269 | 1,865,282 |
Deferred compensation | 347,126 | 261,814 |
Deferred revenue | 2,050 | 29,691 |
Advances from officer and accrued interest | 113,155 | 106,872 |
Convertible term notes payable and accrued interest, net of unamortized discounts | 29,615 | 30,163 |
Related party convertible term notes payable and accrued interest, net of unamortized discounts | 1,273,407 | 1,192,187 |
Current portion of term loans and accrued interest | 1,138,098 | 1,618,462 |
Total current liabilities | $ 13,047,646 | 8,311,818 |
Term loans | 333,333 | |
TOTAL LIABILITIES | $ 14,332,998 | $ 12,309,044 |
Commitments and contingencies | ||
STOCKHOLDERS' EQUITY (DEFICIT) | ||
Preferred stock, $0.001 par value, 10,000,000 shares authorized; no shares issued or outstanding | ||
Common stock, $0.001 par value; 450,000,000 shares authorized; 277,530,645 and 241,095,488 shares issued and outstanding at May 31, 2015 and August 31, 2014, respectively | $ 277,531 | $ 241,096 |
Additional paid-in capital | $ 51,539,123 | 51,036,456 |
Prepaid services paid in common stock | (48,225) | |
Accumulated deficit | $ (64,042,325) | (61,211,909) |
Total stockholders' equity (deficit) | (12,225,671) | (9,982,582) |
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY (DEFICIT) | $ 2,107,327 | $ 2,326,462 |
Condensed Consolidated Balance3
Condensed Consolidated Balance Sheets (Unaudited) (Parentheticals) - $ / shares | May. 31, 2015 | Aug. 31, 2014 |
Preferred stock, par value (in dollars per share) | $ 0.001 | $ 0.001 |
Preferred stock, authorized (in shares) | 10,000,000 | 10,000,000 |
Preferred stock, issued (in shares) | 0 | 0 |
Preferred stock, outstanding (in shares) | 0 | 0 |
Common stock, par value (in dollars per share) | $ 0.001 | $ 0.001 |
Common stock, authorized (in shares) | 450,000,000 | 450,000,000 |
Common stock, issued (in shares) | 277,530,645 | 241,095,488 |
Common stock, outstanding (in shares) | 277,530,645 | 241,095,488 |
Condensed Consolidated Statemen
Condensed Consolidated Statements of Operations (Unaudited) - USD ($) | 3 Months Ended | 9 Months Ended | ||
May. 31, 2015 | May. 31, 2014 | May. 31, 2015 | May. 31, 2014 | |
Net revenue | ||||
Devices | $ 245,762 | $ 216,223 | $ 608,092 | $ 567,196 |
Services | 306,109 | 238,916 | 899,707 | 637,838 |
Total net revenue | 551,871 | 455,139 | 1,507,799 | 1,205,034 |
Cost of revenue | ||||
Devices | 247,875 | 182,960 | 504,390 | 418,929 |
Services | 127,306 | 234,122 | 443,867 | 727,365 |
Total cost of revenue | 375,181 | 417,082 | 948,257 | 1,146,294 |
Gross profit | 176,690 | 38,057 | 559,542 | 58,740 |
Operating expenses | ||||
General and administrative | 256,625 | 341,138 | 793,083 | 1,360,347 |
Officer compensation | 90,000 | 142,000 | 315,000 | 621,746 |
Professional fees | 100,088 | 285,717 | 464,208 | 834,674 |
Rent | $ 5,002 | $ 19,202 | 29,745 | 57,607 |
Research and development | 125,000 | 99,548 | ||
Salaries and wages | $ 156,284 | $ 85,762 | 454,584 | 195,585 |
Total operating expenses | 607,999 | 873,819 | 2,181,620 | 3,169,507 |
Net operating loss | (431,309) | (835,762) | (1,622,078) | (3,110,767) |
Other income (expense) | ||||
Financing costs | $ (58,700) | (105,875) | $ (239,785) | (359,755) |
Amortization of beneficial conversion feature | (440) | (61,388) | ||
Amortization of deferred financing costs | (343,805) | $ (5,506) | (452,155) | |
Amortization of debt discount | $ (51,609) | (55,026) | (154,826) | (260,196) |
Interest expense, net | $ (271,331) | $ (203,554) | $ (807,355) | (524,991) |
Gain on debt settlement | 886,548 | |||
Loss on asset disposals | (48,431) | |||
Foreign currency gain (loss), net | $ (25) | $ (66) | (470) | |
Total other income (expense) | (381,665) | $ (708,700) | (1,207,538) | (820,838) |
Net loss before income taxes | (812,974) | $ (1,544,462) | (2,829,616) | (3,931,605) |
Provision for income taxes | 800 | 800 | 800 | |
Net Loss | $ (813,774) | $ (1,544,462) | $ (2,830,416) | $ (3,932,405) |
Basic and Diluted - Earnings (loss) Per Share (in dollars per share) | $ 0 | $ (0.01) | $ (0.01) | $ (0.02) |
Basic and Diluted - Weighted Average Number of Shares Outstanding (in shares) | 277,530,645 | 216,584,974 | 264,095,650 | 214,133,373 |
Condensed Consolidated Stateme5
Condensed Consolidated Statements of Cash Flows (Unaudited) - USD ($) | 9 Months Ended | |
May. 31, 2015 | May. 31, 2014 | |
Trademarks [Member] | ||
Adjustment to reconcile net loss to net cash used in operating activities: | ||
Gain on sale of trademark | $ (569) | |
Cash Flows from Investing Activities | ||
Proceeds from sale of trademark | 7,500 | |
Net loss | $ (2,830,416) | (3,932,405) |
Loss on asset disposal | 48,431 | |
Gain on debt settlement | (886,548) | |
Provision for doubtful accounts and sales returns | $ 39,000 | 13,931 |
Credit for inventory reserve | (227,474) | (86,605) |
Depreciation and amortization | $ 86,483 | 92,336 |
Amortization of beneficial conversion feature | 61,388 | |
Amortization of deferred financing costs | $ 5,506 | 452,155 |
Amortization of prepaid services paid in common stock | 48,225 | 389,111 |
Amortization of debt discount | 154,826 | 260,196 |
Common stock issued for services and financing costs | (44,281) | (161,170) |
Stock options issued for services | 97,549 | 36,575 |
(Increase) decrease in accounts receivable | (148,926) | (34,140) |
(Increase) decrease in inventory | 532,301 | 246,807 |
(Increase) decrease in prepaid expenses and other assets | 26,122 | 12,508 |
Increase (decrease) in accounts payable and accrued expenses | 147,459 | 368,239 |
Increase (decrease) in accrued officer compensation | 85,312 | (9,070) |
Increase (decrease) in deferred revenue | (27,641) | (3,907) |
Increase (decrease) in accrued interest | 600,972 | 420,783 |
Net cash used in operating activities | (1,366,421) | (2,389,045) |
Purchase of property and equipment | (3,083) | (76,742) |
Net cash used in investing activities | $ (3,083) | (69,242) |
Cash Flows from Financing Activities | ||
Advances / (repayments) from officers, net | (3,825) | |
Payment on term loans | $ (537,202) | (18,000) |
Proceeds from convertible notes payable | 950,000 | 500,000 |
Proceeds from related party convertible notes payable | 1,050,000 | $ 1,450,000 |
Repayment of related party convertible notes payable | (2,500) | |
Net cash provided by financing activities | 1,460,298 | $ 1,928,175 |
Net increase (decrease) in cash and cash equivalents | 90,794 | (530,112) |
Cash and cash equivalents, beginning of period | 146,200 | 680,914 |
Cash and cash equivalents, end of period | 236,994 | 150,802 |
Non-Cash Financing Activities: | ||
Issuance of common stock for conversion of debt | 262,800 | 80,000 |
Issuance of common stock for services and financing costs | $ 134,472 | 357,330 |
Conversion of accrued compensation into convertible notes payable | 117,250 | |
Conversion of accounts payable into common stock | 315,000 | |
Issuance of warrants for financing costs classified as debt discount | $ 213,486 |
Note 1 - Nature of Operations a
Note 1 - Nature of Operations and Summary of Significant Accounting Policies | 9 Months Ended |
May. 31, 2015 | |
Notes to Financial Statements | |
Organization, Consolidation and Presentation of Financial Statements Disclosure and Significant Accounting Policies [Text Block] | 1 . NATURE OF OPERATIONS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Nature of Business The Company designs, develops, and sells personal, pet, and vehicle locator devices and services including PocketFinder® People, PocketFinder® Pets and PocketFinder® Vehicles. The PocketFinder® is a small, completely wireless, location device that enables a user to locate a person, pet, vehicle or valuable item at any time from almost anywhere using Global Positioning System (“GPS”) and General Packet Radio Service (“GPRS”) technologies. The Company is located in Irvine, California. Organization Location Based Technologies, Inc. (formerly known as Springbank Resources, Inc.) (the “Company,” “our,” “we” or “LBT”) was incorporated under the laws of the State of Nevada on April 10, 2006. Location Based Technologies, Corp. (formerly known as PocketFinder, Inc.) was incorporated under the laws of the State of California on September 16, 2005. On July 7, 2006, it established PocketFinder, LLC (“LLC”), a California Limited Liability Company. On May 29, 2007, PocketFinder, Inc. filed amended articles with the Secretary of State to change its name to Location Based Technologies, Corp., and in October 2007 was merged into LBT. On September 30, 2009, the Company formed Location Based Technologies, Ltd. (“LBT, Ltd.”), an England and Wales private limited company, to establish a presence in Europe. LBT, Ltd. is a wholly owned subsidiary of the Company. Consolidation Policy The accompanying consolidated financial statements include the accounts and operations of the Company and its wholly owned subsidiary, Location Based Technologies, Ltd. Intercompany balances and transactions have been eliminated in consolidation. Basis of Presentation The unaudited consolidated financial statements included herein have been prepared in accordance with accounting principles generally accepted in the United States for interim financial information and with the instructions to Form 10-Q and Rule 8-01 of Regulation S-X. They do not include all information and notes required by generally accepted accounting principles for complete financial statements. However, except as disclosed herein, there have been no material changes in the information disclosed in the notes to financial statements included in the annual report on Form 10-K of Location Based Technologies, Inc. for the year ended August 31, 2014. In the opinion of management, all adjustments (including normal recurring accruals) considered necessary for a fair presentation have been included. Operating results for the nine months ended May 31, 2015, are not necessarily indicative of the results that may be expected for any other interim period or the entire year. For further information, these unaudited consolidated financial statements and the related notes should be read in conjunction with the Company’s audited financial statements for the year ended August 31, 2014, included in the Company’s report on Form 10-K. Going Concern The accompanying financial statements have been prepared in conformity with accounting principles generally accepted in the United States of America, which contemplate continuation of the Company as a going concern. The Company has incurred net losses since inception, and as of May 31 , 2015 Management recognizes that the Company must generate additional resources to enable it to continue operations. Management intends to raise additional financing through debt and equity financing or through other means that it deems necessary, with a view to moving forward and sustaining prolonged growth in its strategy phases. However, no assurance can be given that the Company will be successful in raising additional capital. Further, even if the Company raises additional capital, there can be no assurance that the Company will achieve profitability or positive cash flow. If management is unable to raise additional capital and expected significant revenues do not result in positive cash flow, the Company will not be able to meet its obligations and may have to cease operations. Allowance for Doubtful Accounts The allowance for doubtful accounts on accounts receivable is charged to operations in amounts sufficient to maintain the allowance for uncollectible accounts at a level management believes is adequate to cover any probable losses. Management determines the adequacy of the allowance based on historical write-off percentages and the current status of accounts receivable. Accounts receivable are charged off against the allowance when collectability is determined to be permanently impaired. As of May 31, 2015 and August 31, 2014, the allowance for doubtful accounts amounted to $75,000 and $27,000, respectively. Allowance for Sales returns An allowance for sales returns is recorded as a reduction to revenue and based on management’s judgment using historical experience and expectation of future conditions. As of May 31, 2015 and August 31, 2014, the allowance for sales returns amounted to $18,000 and $27,000, respectively. Inventory Inventories are valued at the lower of cost (first-in, first-out) or market and primarily consisted of components and finished goods for the Company’s PocketFinder® products. Packaging costs are expensed as incurred. The Company provides for a lower-of-cost-or-market ("LCM") adjustment against gross inventory values. Management estimates the current selling price of $58.00 as the realizable value of the inventory. Management estimated sales for the next 24 month period based on historical sales data and prospective sales trends and determined that all inventory is expected to be sold in the next two years. A portion of the components inventory, net of the LCM valuation reserve, totaling $368,617 is classified as a noncurrent asset at May 31, 2015 (see Note 3). In addition, management analyzed and tested certain components and determined that quantities in excess of levels necessary to build 22,500 finished goods units were obsolete and recorded a reserve for obsolescence in the amount of $64,824 as of May 31, 2015. D eferred Revenue Deferred revenue is a liability related to revenue producing activity for which revenue has not yet been recognized. As of May 31, 2015 and August 31, 2014, deferred revenue amounted to $2,050 and $29,961, respectively, and consisted of prepaid service revenue from subscribers. Advertising Costs Advertising costs are expensed as incurred. For the three months ended May 31, 2015 and 2014, the Company incurred $2,000 and $19,807 of advertising costs, respectively. For the nine months ended May 31, 2015 and 2014, the Company incurred $20,682 and $486,269 of advertising costs, respectively. Derivative Liabilities During the six months ended February 28, 2015, the Company determined that there were no longer sufficient authorized shares to satisfy outstanding warrants, option agreements and convertible notes if all such agreements were to be exercised or noteholders elected to convert. Accordingly, the Company recognized a derivative liability and recorded such liability $601,627 and a reduction to additional paid-in-capital using the Black-Scholes valuation as of February 28, 2015. Subsequent to May 31, 2015, the Company increased the number of authorized shares to 450,000,000 (See Note 9). As a result, the Company reduced the derivative liability to $0 as of May 31, 2015. |
Note 2 - Earnings Loss Per Shar
Note 2 - Earnings Loss Per Share | 9 Months Ended |
May. 31, 2015 | |
Notes to Financial Statements | |
Earnings Per Share [Text Block] | 2 . EARNINGS LOSS PER SHARE The Company computes basic earnings (loss) per share using the weighted average number of common shares outstanding during the period in accordance with FASB ASC 260 – Earnings Per Share, Diluted earnings (loss) per share are computed using the weighted average number of common shares outstanding and the dilutive potential common shares outstanding during the period. The following potential common shares are excluded from diluted loss per share as their effect would be anti-dilutive. May 31 , August 31, 201 5 201 4 Warrants 17,684,022 17,956,715 Stock options 3,495,163 3,025,000 Convertible notes payable 167,458,548 40,564,550 Dilutive potential common shares 188,637,733 61,546,265 |
Note 3 - Inventory
Note 3 - Inventory | 9 Months Ended |
May. 31, 2015 | |
Notes to Financial Statements | |
Inventory Disclosure [Text Block] | 3 . INVENTORY Inventory at May 31, 2015 and August 31, 2014 consisted of the following: May 31 , August 31 , 201 5 201 4 Current: Finished goods $ 486,245 $ 1,016,876 Device Components 718,924 419,681 Inventory valuation reserve (520,135 ) (643,225 ) Inventories, current $ 685,034 $ 793,332 Noncurrent: Device components $ 750,810 $ 1,051,722 Inventory valuation and obsolescence reserves (382,193 ) (486,576 ) Inventories, noncurrent $ 368,617 $ 565,146 In the first quarter of 2012, the Company purchased a substantial amount of inventory components to produce PocketFinder® devices. Management analyzed its inventories based on existing purchase orders and current potential orders for future delivery and determined we may not realize all of the inventory components within the next year. The Company expects that it will take approximately three months to sell finished goods inventory on hand at May 31, 2015. Following the sale of all finished goods inventory, components inventory will be utilized to manufacture additional devices that are expected to be sold in year 1 and 2. Inventories totaling $750,810 which may not be realized within a 12-month period have been reclassified as long-term as of May 31, 2015. |
Note 4 - Related Party Transact
Note 4 - Related Party Transactions | 9 Months Ended |
May. 31, 2015 | |
Notes to Financial Statements | |
Related Party Transactions Disclosure [Text Block] | 4 . RELATED PARTY TRANSACTIONS Advances from Officer During the nine months ended May 31, 2015 and 2014, there were advances from our former Chief Development Officer totaling $0 and $156,500, respectively; and repayments totaling $0 and $160,325, respectively. As of May 31, 2015, there was $105,000 of outstanding advances and $8,155 of related accrued interest. SkyBell Technologies, Inc. The Company occupies office space at a facility leased by SkyBell Technologies, Inc. (“SkyBell”). In addition, the Company outsources its customer service to SkyBell under a month to month contract that commenced in February 2014. SkyBell is owned and operated by Joseph Scalisi, former Chief Development Officer, and Desiree Mejia, Chief Operating Officer. During the three months ended May 31, 2015, the Company incurred $7,095 in costs related to these services. During the nine months ended May 31, 2015, Accounts Payable and Accrued Expenses Amounts payable and accrued expenses to related parties totaled $746,748 and $471,979 as of May 31, 2015 and August 31, 2014, respectively. |
Note 5 - Debt
Note 5 - Debt | 9 Months Ended |
May. 31, 2015 | |
Notes to Financial Statements | |
Convertible Notes Payable [Text Block] | 5 . DEBT New Debt Issuances The following debt was issued during the nine months ended May 31, 2015: On September 5, 2014, the Company entered into a convertible promissory note for $450,000. The note bears interest at 10% per annum, may be converted into common stock of the Company at $0.10 per share, or 50% of the Company’s closing stock price at any time after April 15, 2015, upon written notice. The note is due on September 5, 2015 and is secured by certain intellectual property owned by the Company. On September 11, 2014, the Company entered into a convertible promissory note for $150,000 with a board member. The note bears interest at 10% per annum, may be converted into common stock of the Company at $0.10 per share, or 50% of the Company’s closing stock price at any time after April 15, 2015, upon written notice. The note is due on September 11, 2016 and is secured by all assets of the Company. On October 14, 2014, the Company entered into a convertible promissory note for $100,000 with a board member. The note bears interest at 10% per annum, may be converted into common stock of the Company at $0.10 per share, or 50% of the Company’s closing stock price at any time after April 15, 2015, upon written notice. The note is due on October 14, 2016 and is secured by all assets of the Company. On November 21, 2014, the Company entered into a convertible promissory note for $500,000. The note bears interest at 10% per annum, may be converted into common stock of the Company at $0.10 per share, or 50% of the Company’s closing stock price at any time after April 15, 2015, upon written notice. The note is due on December 1, 2015 and is secured by all assets of the Company. On November 26, 2014, the Company entered into a convertible promissory note for $216,000 with a board member. The note bears interest at 10% per annum, may be converted into common stock of the Company at $0.10 per share, or 50% of the On December 3, 2014, the Company entered into a convertible promissory note for $84,000 with a board member. The note bears interest at 10% per annum, may be converted into common stock of the Company at $0.10 per share, or 50% of the Company’s closing stock price at any time after April 15, 2015, upon written notice. The note is due on December 3, 2016 and is secured by all assets of the Company. On January 7, 2015, the Company entered into a convertible promissory note for $50,000 with a board member. The note bears interest at 10% per annum, may be converted into common stock of the Company at $0.10 per share, or 50% of the Company’s closing stock price at any time after April 15, 2015, upon written notice. The note is due on January 7, 2017 and is secured by all assets of the Company. On February 3, 2015, the Company entered into a convertible promissory note for $50,000 with a board member. The note bears interest at 10% per annum, may be converted into common stock of the Company at $0.10 per share, or 50% of the Company’s closing stock price at any time after April 15, 2015, upon written notice. The note is due on February 3, 2017 and is secured by all assets of the Company. On March 9, 2015, the Company entered into a convertible promissory note for $300,000 with a board member. The note bears interest at 10% per annum, may be converted into common stock of the Company at $0.10 per share, or 50% of the Company’s closing stock price at any time after April 15, 2015, upon written notice. The note is due on March 9, 2017 and is secured by all assets of the Company. On April 6, 2015, the Company entered into a convertible promissory note for $50,000 with a board member. The note bears interest at 10% per annum, may be converted into common stock of the Company at $0.10 per share, or 50% of the Company’s closing stock price at any time after April 15, 2015, upon written notice. The note is due on April 6, 2017 and is secured by all assets of the Company. On May 13, 2015, the Company entered into a convertible promissory note for $50,000 with a board member. The note bears interest at 10% per annum, may be converted into common stock of the Company at $0.10 per share, upon written notice. The note is due on May 13, 2017 and is secured by all assets of the Company. Debt Amendments The following debt amendments were executed during the nine months ended May 31, 2015: On September 5, 2014, the Company amended the secured promissory note payable totaling $1,000,000 to extend the maturity date to September 5, 2015 and to allow the Lender at the Maturity Date, or during any time after April 15, 2015, the right, but not the obligation, to convert this Note into shares of the Company’s common stock at a price equal to the lower of $0.20 per share or 50% of the closing stock price on the day after the Company is given notice of the conversion by the Lender (the “Conversion Price”). On November 28, 2014, the Company amended one convertible demand note payable totaling $28,500 to eliminate the extension fee and increase the interest rate to Ten Percent (10%) per annum. On November 28, 2014, the Company amended five convertible notes payable to related parties totaling $1,114,487 to eliminate the extension fee and increase the interest rate to ten Percent (10%) per annum. On February 27, 2015, the Company amended two secured promissory note payable with a board member totaling $1,400,000 to allow the Lender at the Maturity Date, or during any time after April 15, 2015, the right, but not the obligation, to convert these Notes into shares of the Company’s common stock at a price equal to the lower of $0.20 per share or 50% of the closing stock price on the day after the Company is given notice of the conversion by the Lender (the “Conversion Price”). On April 15, 2015, the Company entered into a Modification Agreement to a Secured Convertible Promissory Note totaling $1,000,000 with Bridge Loans, LLC dated November 28, 2012, whereby Bridge Loans, LLC agreed to waive the right to convert the loan at 50% of the closing stock price until July 15, 2015. On April 15, 2015, the Company entered into a Modification Agreement to a Secured Convertible Promissory Note totaling $450,000 with ECPC Capital II, LLC dated September 5, 2014, whereby ECPC Capital II, LLC agreed to waive the right to convert the loan at 50% of the closing stock price until July 15, 2015. |
Note 6 - Line of Credit and Ter
Note 6 - Line of Credit and Term Loans | 9 Months Ended |
May. 31, 2015 | |
Notes to Financial Statements | |
Debt Disclosure [Text Block] | 6 . LINE OF CREDIT AND TERM LOANS Principal Repayments As of May 31, 2015, the principal maturities of the convertible notes payable and related party convertible notes payable are as follows: For the Years Ending: May 31, 2016 $ 8,266,939 May 31, 2017 1,226,500 Total $ 9,493,439 SVB Line of Credit On January 5, 2011, the Company entered into a Loan and Security Agreement (“Loan Agreement”) with Silicon Valley Bank (“SVB”) for a $1,000,000 non-formula line of credit. The principal amount outstanding under the credit line accrues interest at a floating per annum rate equal to the greater of (i) the Prime Rate, plus 2.5% or (ii) 6.5% and is to be paid monthly. The Company must maintain certain financial covenants under the Loan Agreement. The personal guarantor for the credit line is a director and stockholder of the Company. In connection with the Loan Agreement, the Company entered into a Financing Agreement and Loan Guarantor Agreement with a board member to personally guarantee the Loan Agreement. As compensation for the guarantee under the Financing Agreement, the guarantor is entitled to payment of $5,000 per month, plus Two Percent (2%) of the outstanding balance of the SVB loan balance (“guarantee fee”), payable in cash or shares of the Company’s common stock at the guarantor’s option. As of May 31, 2015, the Company’s accounts payable and accrued expenses included $630,500 in guarantee fees owed to the board member. As of May 31, 2015, the outstanding balance on the line of credit and accrued interest totaled $485,298 and $4,388, respectively. The total amount has been included in the current portion of term loans and accrued interest on the balance sheet as of May 31, 2015. JMJ Notes Payable As of May 31, 2015 and August 31, 2014, the outstanding balance on the notes payable and accrued interest totaled $648,412 and $933,712, respectively. The total amount has been included in the current portion of term loans and accrued interest on the balance sheet as of May 31, 2015. |
Note 7 - Equity
Note 7 - Equity | 9 Months Ended |
May. 31, 2015 | |
Notes to Financial Statements | |
Stockholders' Equity Note Disclosure [Text Block] | 7 . EQUITY Common Stock The Company issued 375,000 shares of common stock to three members of the board of directors in exchange for six months of service during the nine months ended May 31, 2015. The shares were valued at $3,338, which represents the fair market value of the shares provided on the award date. The Company issued 1,359,254 shares of common stock in connection with note payable maturity date extensions during the nine months ended May 31, 2015. The shares were valued at $81,555, which represents the fair market value of the shares issued on the award date. The Company issued 30,750,903 shares of common stock for the conversion of debt amounting to $262,800 during the nine months ended May 31, 2015. The Company issued 3,950,000 shares of common stock to consultants in exchange for various advisory services during the nine months May 31, 2015. The shares were valued at $40,943, which represents the fair market value of the shares provided on the award date. |
Note 8 - Provision for Income T
Note 8 - Provision for Income Taxes | 9 Months Ended |
May. 31, 2015 | |
Notes to Financial Statements | |
Income Tax Disclosure [Text Block] | 8 . PROVISION FOR INCOME TAXES The Company did not provide any current or deferred U.S. federal income taxes or benefits for any of the periods presented because the Company has experienced operating losses since inception. The Company provided a full valuation allowance on the net deferred tax asset, consisting of net operating loss carry forwards, because management has determined that it is more likely than not that we will not earn sufficient income to realize the deferred tax assets during the carry forward period. The components of the Company’s deferred tax asset as of May 31, 2015 and August 31, 2014 are as follows: May 31 , August 31 , 201 5 2014 Net operating loss carry forward and deductible temporary differences Valuation allowance $ 21,880,341 $ 20,880,437 (21,880,341 ) (20,880,437 ) Net deferred tax asset $ - $ - As of May 31, 2015, the Company had federal and state net operating loss carryforwards of approximately $55,068,638 which can be used to offset future federal income tax. The federal and state net operating loss carryforwards expire at various dates through 2033. As of May 31 , 2015 |
Note 9 - Subsequent Events
Note 9 - Subsequent Events | 9 Months Ended |
May. 31, 2015 | |
Notes to Financial Statements | |
Subsequent Events [Text Block] | 9. SUBSEQUENT EVENTS Debt Issuances On June 2, 2015, the Company entered into a convertible promissory note for $44,117 with a board member. The note bears interest at 10% per annum, may be converted into common stock of the Company at $0.10 per share, upon written notice. The note is due on June 2, 2017 and is secured by all assets of the Company. On July 2, 2015, the Company entered into a convertible promissory note for $44,117 with a board member. The note bears interest at 10% per annum, may be converted into common stock of the Company at $0.10 per share, upon written notice. The note is due on June 2, 2017 and is secured by all assets of the Company. Debt Amendments On July 3, 2015, the Company amended nine Secured Convertible Promissory Note totaling $2,000,000 with Greggory Haugen, a board member, whereby Greggory Haugen agreed to waive the right to convert the loans at 50% of the closing stock price until July 15, 2015. Equity On July 2, 2015 the Company amended the Article of Incorporation, increasing the number of authorized common shares from 300,000,000 to 450,000,000. |
Significant Accounting Policies
Significant Accounting Policies (Policies) | 9 Months Ended |
May. 31, 2015 | |
Accounting Policies [Abstract] | |
Nature of Business [Policy Text Block] | Nature of Business The Company designs, develops, and sells personal, pet, and vehicle locator devices and services including PocketFinder® People, PocketFinder® Pets and PocketFinder® Vehicles. The PocketFinder® is a small, completely wireless, location device that enables a user to locate a person, pet, vehicle or valuable item at any time from almost anywhere using Global Positioning System (“GPS”) and General Packet Radio Service (“GPRS”) technologies. The Company is located in Irvine, California. Organization Location Based Technologies, Inc. (formerly known as Springbank Resources, Inc.) (the “Company,” “our,” “we” or “LBT”) was incorporated under the laws of the State of Nevada on April 10, 2006. Location Based Technologies, Corp. (formerly known as PocketFinder, Inc.) was incorporated under the laws of the State of California on September 16, 2005. On July 7, 2006, it established PocketFinder, LLC (“LLC”), a California Limited Liability Company. On May 29, 2007, PocketFinder, Inc. filed amended articles with the Secretary of State to change its name to Location Based Technologies, Corp., and in October 2007 was merged into LBT. On September 30, 2009, the Company formed Location Based Technologies, Ltd. (“LBT, Ltd.”), an England and Wales private limited company, to establish a presence in Europe. LBT, Ltd. is a wholly owned subsidiary of the Company. |
Consolidation, Policy [Policy Text Block] | Consolidation Policy The accompanying consolidated financial statements include the accounts and operations of the Company and its wholly owned subsidiary, Location Based Technologies, Ltd. Intercompany balances and transactions have been eliminated in consolidation. |
Basis of Accounting, Policy [Policy Text Block] | Basis of Presentation The unaudited consolidated financial statements included herein have been prepared in accordance with accounting principles generally accepted in the United States for interim financial information and with the instructions to Form 10-Q and Rule 8-01 of Regulation S-X. They do not include all information and notes required by generally accepted accounting principles for complete financial statements. However, except as disclosed herein, there have been no material changes in the information disclosed in the notes to financial statements included in the annual report on Form 10-K of Location Based Technologies, Inc. for the year ended August 31, 2014. In the opinion of management, all adjustments (including normal recurring accruals) considered necessary for a fair presentation have been included. Operating results for the nine months ended May 31, 2015, are not necessarily indicative of the results that may be expected for any other interim period or the entire year. For further information, these unaudited consolidated financial statements and the related notes should be read in conjunction with the Company’s audited financial statements for the year ended August 31, 2014, included in the Company’s report on Form 10-K. |
Liquidity Disclosure [Policy Text Block] | Going Concern The accompanying financial statements have been prepared in conformity with accounting principles generally accepted in the United States of America, which contemplate continuation of the Company as a going concern. The Company has incurred net losses since inception, and as of May 31 , 2015 Management recognizes that the Company must generate additional resources to enable it to continue operations. Management intends to raise additional financing through debt and equity financing or through other means that it deems necessary, with a view to moving forward and sustaining prolonged growth in its strategy phases. However, no assurance can be given that the Company will be successful in raising additional capital. Further, even if the Company raises additional capital, there can be no assurance that the Company will achieve profitability or positive cash flow. If management is unable to raise additional capital and expected significant revenues do not result in positive cash flow, the Company will not be able to meet its obligations and may have to cease operations. |
Receivables, Trade and Other Accounts Receivable, Allowance for Doubtful Accounts, Policy [Policy Text Block] | Allowance for Doubtful Accounts The allowance for doubtful accounts on accounts receivable is charged to operations in amounts sufficient to maintain the allowance for uncollectible accounts at a level management believes is adequate to cover any probable losses. Management determines the adequacy of the allowance based on historical write-off percentages and the current status of accounts receivable. Accounts receivable are charged off against the allowance when collectability is determined to be permanently impaired. As of May 31, 2015 and August 31, 2014, the allowance for doubtful accounts amounted to $75,000 and $27,000, respectively. |
Revenue Recognition, Sales Returns [Policy Text Block] | Allowance for Sales returns An allowance for sales returns is recorded as a reduction to revenue and based on management’s judgment using historical experience and expectation of future conditions. As of May 31, 2015 and August 31, 2014, the allowance for sales returns amounted to $18,000 and $27,000, respectively. |
Inventory, Policy [Policy Text Block] | Inventory Inventories are valued at the lower of cost (first-in, first-out) or market and primarily consisted of components and finished goods for the Company’s PocketFinder® products. Packaging costs are expensed as incurred. The Company provides for a lower-of-cost-or-market ("LCM") adjustment against gross inventory values. Management estimates the current selling price of $58.00 as the realizable value of the inventory. Management estimated sales for the next 24 month period based on historical sales data and prospective sales trends and determined that all inventory is expected to be sold in the next two years. A portion of the components inventory, net of the LCM valuation reserve, totaling $368,617 is classified as a noncurrent asset at May 31, 2015 (see Note 3). In addition, management analyzed and tested certain components and determined that quantities in excess of levels necessary to build 22,500 finished goods units were obsolete and recorded a reserve for obsolescence in the amount of $64,824 as of May 31, 2015. |
Revenue Recognition, Deferred Revenue [Policy Text Block] | D eferred Revenue Deferred revenue is a liability related to revenue producing activity for which revenue has not yet been recognized. As of May 31, 2015 and August 31, 2014, deferred revenue amounted to $2,050 and $29,961, respectively, and consisted of prepaid service revenue from subscribers. |
Advertising Costs, Policy [Policy Text Block] | Advertising Costs Advertising costs are expensed as incurred. For the three months ended May 31, 2015 and 2014, the Company incurred $2,000 and $19,807 of advertising costs, respectively. For the nine months ended May 31, 2015 and 2014, the Company incurred $20,682 and $486,269 of advertising costs, respectively. |
Derivatives, Policy [Policy Text Block] | Derivative Liabilities During the six months ended February 28, 2015, the Company determined that there were no longer sufficient authorized shares to satisfy outstanding warrants, option agreements and convertible notes if all such agreements were to be exercised or noteholders elected to convert. Accordingly, the Company recognized a derivative liability and recorded such liability $601,627 and a reduction to additional paid-in-capital using the Black-Scholes valuation as of February 28, 2015. Subsequent to May 31, 2015, the Company increased the number of authorized shares to 450,000,000 (See Note 9). As a result, the Company reduced the derivative liability to $0 as of May 31, 2015. |
Note 2 - Earnings Loss Per Sh16
Note 2 - Earnings Loss Per Share (Tables) | 9 Months Ended |
May. 31, 2015 | |
Notes Tables | |
Schedule of Antidilutive Securities Excluded from Computation of Earnings Per Share [Table Text Block] | May 31 , August 31, 201 5 201 4 Warrants 17,684,022 17,956,715 Stock options 3,495,163 3,025,000 Convertible notes payable 167,458,548 40,564,550 Dilutive potential common shares 188,637,733 61,546,265 |
Note 3 - Inventory (Tables)
Note 3 - Inventory (Tables) | 9 Months Ended |
May. 31, 2015 | |
Notes Tables | |
Schedule of Inventory, Current [Table Text Block] | May 31 , August 31 , 201 5 201 4 Current: Finished goods $ 486,245 $ 1,016,876 Device Components 718,924 419,681 Inventory valuation reserve (520,135 ) (643,225 ) Inventories, current $ 685,034 $ 793,332 Noncurrent: Device components $ 750,810 $ 1,051,722 Inventory valuation and obsolescence reserves (382,193 ) (486,576 ) Inventories, noncurrent $ 368,617 $ 565,146 |
Note 6 - Line of Credit and T18
Note 6 - Line of Credit and Term Loans (Tables) | 9 Months Ended |
May. 31, 2015 | |
Notes Tables | |
Schedule of Maturities of Long-term Debt [Table Text Block] | May 31, 2016 $ 8,266,939 May 31, 2017 1,226,500 Total $ 9,493,439 |
Note 8 - Provision for Income19
Note 8 - Provision for Income Taxes (Tables) | 9 Months Ended |
May. 31, 2015 | |
Notes Tables | |
Schedule of Deferred Tax Assets and Liabilities [Table Text Block] | May 31 , August 31 , 201 5 2014 Net operating loss carry forward and deductible temporary differences Valuation allowance $ 21,880,341 $ 20,880,437 (21,880,341 ) (20,880,437 ) Net deferred tax asset $ - $ - |
Note 1 - Nature of Operations20
Note 1 - Nature of Operations and Summary of Significant Accounting Policies (Details Textual) | 3 Months Ended | 6 Months Ended | 9 Months Ended | ||||||
May. 31, 2015USD ($)shares | May. 31, 2014USD ($) | Feb. 28, 2015USD ($) | May. 31, 2015USD ($)shares | May. 31, 2014USD ($) | Jul. 03, 2015shares | Jul. 02, 2015shares | Jul. 01, 2015shares | Aug. 31, 2014USD ($)shares | |
Allowance for Sales Returns [Member] | |||||||||
Valuation Allowances and Reserves, Balance | $ 18,000 | $ 18,000 | $ 27,000 | ||||||
Inventory Noncurrent [Member] | |||||||||
Inventory, Net | 368,617 | 368,617 | |||||||
Inventory Valuation and Obsolescence [Member] | |||||||||
Inventory Valuation Reserves | 64,824 | 64,824 | |||||||
Subsequent Event [Member] | |||||||||
Common Stock, Shares Authorized | shares | 450,000,000 | 450,000,000 | 300,000,000 | ||||||
Retained Earnings (Accumulated Deficit) | (64,042,325) | (64,042,325) | (61,211,909) | ||||||
Working Capital | (11,918,330) | (11,918,330) | |||||||
Allowance for Doubtful Accounts Receivable | 75,000 | 75,000 | 27,000 | ||||||
Inventory Realizable Value | 58 | $ 58 | |||||||
Sale of Inventory, Expected Period | 2 years | ||||||||
Inventory, Net | $ 685,034 | $ 685,034 | 793,332 | ||||||
Finished Goods,Obsolete | 22,500 | 22,500 | |||||||
Deferred Revenue | $ 2,050 | $ 2,050 | $ 29,961 | ||||||
Marketing and Advertising Expense | $ 2,000 | $ 19,807 | $ 20,682 | $ 486,269 | |||||
Derivative, Loss on Derivative | $ 601,627 | ||||||||
Common Stock, Shares Authorized | shares | 450,000,000 | 450,000,000 | 450,000,000 | ||||||
Derivative Liability | $ 0 | $ 0 |
Note 2 - Earnings Per Share - A
Note 2 - Earnings Per Share - Antidilutive Securities Excluded from Earnings Per Share (Details) - shares | 9 Months Ended | 12 Months Ended |
May. 31, 2015 | Aug. 31, 2014 | |
Warrant [Member] | ||
Warrants (in shares) | 17,684,022 | 17,956,715 |
Equity Option [Member] | ||
Warrants (in shares) | 3,495,163 | 3,025,000 |
Convertible Debt Securities [Member] | ||
Warrants (in shares) | 167,458,548 | 40,564,550 |
Warrants (in shares) | 188,637,733 | 61,546,265 |
Note 3 - Inventory (Details Tex
Note 3 - Inventory (Details Textual) - USD ($) | May. 31, 2015 | Aug. 31, 2014 |
Device Components [Member] | ||
Inventory [Line Items] | ||
Inventory, Noncurrent | $ 750,810 | |
Inventory, Noncurrent | $ 368,617 | $ 565,146 |
Note 3 - Inventory - Components
Note 3 - Inventory - Components of Inventory (Details) - USD ($) | May. 31, 2015 | Aug. 31, 2014 |
Current [Member] | Finished Goods [Member] | ||
Current: | ||
Finished goods | $ 486,245 | $ 1,016,876 |
Current [Member] | Device Components [Member] | ||
Current: | ||
Device Components | 718,924 | 419,681 |
Noncurrent: | ||
Device Components | 718,924 | 419,681 |
Current [Member] | ||
Current: | ||
Inventory valuation reserve | (520,135) | (643,225) |
Noncurrent: | ||
Inventory valuation reserve | (520,135) | (643,225) |
Noncurrent [Member] | Device Components [Member] | ||
Current: | ||
Device Components | 750,810 | 1,051,722 |
Noncurrent: | ||
Device Components | 750,810 | 1,051,722 |
Noncurrent [Member] | ||
Current: | ||
Inventory valuation reserve | (382,193) | (486,576) |
Noncurrent: | ||
Inventory valuation reserve | (382,193) | (486,576) |
Device Components [Member] | ||
Noncurrent: | ||
Inventory, Noncurrent | 750,810 | |
Inventories, current | 685,034 | 793,332 |
Inventory, Noncurrent | $ 368,617 | $ 565,146 |
Note 4 - Related Party Transa24
Note 4 - Related Party Transactions (Details Textual) - USD ($) | 3 Months Ended | 9 Months Ended | ||
May. 31, 2015 | May. 31, 2015 | May. 31, 2014 | Aug. 31, 2014 | |
Chief Development Officer [Member] | ||||
Related Party Transaction [Line Items] | ||||
Proceeds from Related Party Debt | $ 0 | |||
Due to Related Parties, Current | $ 105,000 | 105,000 | ||
Chief Development Officer [Member] | ||||
Related Party Transaction [Line Items] | ||||
Proceeds from Related Party Debt | $ 156,500 | |||
Repayments of Related Party Debt | 0 | 160,325 | ||
SkyBell Technologies Inc [Member] | ||||
Related Party Transaction [Line Items] | ||||
Related Party Transaction, Expenses from Transactions with Related Party | 7,095 | 72,257 | ||
Accrued Interest [Member] | ||||
Related Party Transaction [Line Items] | ||||
Due to Related Parties, Current | 8,155 | 8,155 | ||
Proceeds from Related Party Debt | 1,050,000 | $ 1,450,000 | ||
Repayments of Related Party Debt | 2,500 | |||
Due to Related Parties, Current | 113,155 | 113,155 | $ 106,872 | |
Accounts Payable, Related Parties | $ 746,748 | $ 746,748 | $ 471,979 |
Note 5 - Debt (Details Textual)
Note 5 - Debt (Details Textual) - USD ($) | May. 13, 2015 | Apr. 15, 2015 | Apr. 06, 2015 | Mar. 09, 2015 | Feb. 27, 2015 | Feb. 03, 2015 | Jan. 07, 2015 | Dec. 03, 2014 | Nov. 28, 2014 | Nov. 26, 2014 | Nov. 21, 2014 | Oct. 14, 2014 | Sep. 11, 2014 | Sep. 05, 2014 |
Board Member [Member] | Two Notes [Member] | ||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||
Debt Instrument, Convertible, Conversion Price | $ 0.20 | |||||||||||||
Debt Instrument Convertible Conversion Price Percentage of Stock Price | 50.00% | |||||||||||||
Debt Instrument, Face Amount | $ 1,400,000 | |||||||||||||
Board Member [Member] | ||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||
Convertible Notes Payable | $ 50,000 | $ 50,000 | $ 300,000 | $ 50,000 | $ 50,000 | $ 84,000 | $ 216,000 | $ 100,000 | $ 150,000 | |||||
Debt Instrument, Interest Rate, Stated Percentage | 10.00% | 10.00% | 10.00% | 10.00% | 10.00% | 10.00% | 10.00% | 10.00% | 10.00% | |||||
Debt Instrument, Convertible, Conversion Price | $ 0.10 | $ 0.10 | $ 0.10 | $ 0.10 | $ 0.10 | $ 0.10 | $ 0.10 | $ 0.10 | $ 0.10 | |||||
Debt Instrument Convertible Conversion Price Percentage of Stock Price | 50.00% | 50.00% | 50.00% | 50.00% | 50.00% | 50.00% | 50.00% | 50.00% | ||||||
In Connection with Note Payable Extension [Member] | ||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||
Debt Instrument, Convertible, Conversion Price | $ 0.20 | |||||||||||||
Debt Instrument Convertible Conversion Price Percentage of Stock Price | 50.00% | |||||||||||||
Debt Instrument, Face Amount | $ 1,000,000 | |||||||||||||
One Note [Member] | ||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||
Debt Instrument, Interest Rate, Stated Percentage | 10.00% | |||||||||||||
Debt Instrument, Face Amount | $ 28,500 | |||||||||||||
Five Notes [Member] | ||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||
Debt Instrument, Interest Rate, Stated Percentage | 10.00% | |||||||||||||
Debt Instrument, Face Amount | $ 1,114,487 | |||||||||||||
Bridge Loans, LLC [Member] | ||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||
Debt Instrument Convertible Conversion Price Percentage of Stock Price | 50.00% | |||||||||||||
Debt Instrument, Face Amount | $ 1,000,000 | |||||||||||||
ECPC Capital II, LLC [Member] | ||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||
Debt Instrument Convertible Conversion Price Percentage of Stock Price | 50.00% | |||||||||||||
Debt Instrument, Face Amount | $ 450,000 | |||||||||||||
Convertible Notes Payable | $ 500,000 | $ 450,000 | ||||||||||||
Debt Instrument, Interest Rate, Stated Percentage | 10.00% | 10.00% | ||||||||||||
Debt Instrument, Convertible, Conversion Price | $ 0.10 | $ 0.10 | ||||||||||||
Debt Instrument Convertible Conversion Price Percentage of Stock Price | 50.00% | 50.00% |
Note 6 - Line of Credit and T26
Note 6 - Line of Credit and Term Loans (Details Textual) - USD ($) | Jan. 05, 2011 | May. 31, 2015 | Nov. 21, 2014 | Sep. 05, 2014 | Aug. 31, 2014 |
Loan Agreement [Member] | Prime Rate [Member] | |||||
Line of Credit Facility [Line Items] | |||||
Debt Instrument, Basis Spread on Variable Rate | 2.50% | ||||
Loan Agreement [Member] | Minimum [Member] | |||||
Line of Credit Facility [Line Items] | |||||
Debt Instrument, Interest Rate, Stated Percentage | 6.50% | ||||
Loan Agreement [Member] | Guarantee Fee [Member] | |||||
Line of Credit Facility [Line Items] | |||||
Accounts Payable and Other Accrued Liabilities | $ 630,500 | ||||
Loan Agreement [Member] | |||||
Line of Credit Facility [Line Items] | |||||
Line of Credit Facility, Maximum Borrowing Capacity | $ 1,000,000 | ||||
Guarantee Fee | $ 5,000 | ||||
Percentage of Loan Balance, Guarantee Fee | 2.00% | ||||
Long-term Line of Credit | $ 485,298 | ||||
Interest Payable | 4,388 | ||||
Settlement Agreement [Member] | |||||
Line of Credit Facility [Line Items] | |||||
Notes Payable | $ 648,412 | $ 933,712 | |||
Debt Instrument, Interest Rate, Stated Percentage | 10.00% | 10.00% |
Note 6 - Line of Credit and T27
Note 6 - Line of Credit and Term Loans - Principal Payments (Details) - Convertible Note Payable [Member] | May. 31, 2015USD ($) |
May 31, 2016 | $ 8,266,939 |
May 31, 2017 | 1,226,500 |
Total | $ 9,493,439 |
Note 7 - Equity (Details Textua
Note 7 - Equity (Details Textual) - USD ($) | 9 Months Ended | |
May. 31, 2015 | May. 31, 2014 | |
Six Months of Service [Member] | ||
Stock Issued During Period, Shares, Issued for Services | 375,000 | |
Stock Issued During Period, Value, Issued for Services | $ 3,338 | |
In Connection with Note Payable Extension [Member] | ||
Stock Issued During Period, Shares, New Issues | 1,359,254 | |
Stock Issued During Period, Value, New Issues | $ 81,555 | |
Conversion of Debt [Member] | ||
Stock Issued During Period, Shares, New Issues | 30,750,903 | |
Stock Issued During Period, Value, New Issues | $ 262,800 | |
Advisory Services [Member] | ||
Stock Issued During Period, Shares, Issued for Services | 3,950,000 | |
Stock Issued During Period, Value, Issued for Services | $ 40,943 | |
Stock Issued During Period, Value, Issued for Services | $ 134,472 | $ 357,330 |
Note 8 - Provision for Income29
Note 8 - Provision for Income Taxes (Details Textual) - May. 31, 2015 - USD ($) | Total |
Domestic Tax Authority [Member] | Earliest Tax Year [Member] | |
Income Tax Contingency [Line Items] | |
Open Tax Year | 2,012 |
State and Local Jurisdiction [Member] | Earliest Tax Year [Member] | |
Income Tax Contingency [Line Items] | |
Open Tax Year | 2,012 |
Income Tax Examination, Penalties and Interest Accrued | $ 0 |
Operating Loss Carryforwards | $ 55,068,638 |
Note 8 - Provision for Income30
Note 8 - Provision for Income Taxes - Components of Deferred Tax Assets (Details) - USD ($) | May. 31, 2015 | Aug. 31, 2014 |
Net operating loss carry forward and deductible temporary differences Valuation allowance | $ 21,880,341 | $ 20,880,437 |
Valuation allowance | (21,880,341) | (20,880,437) |
Net deferred tax asset | $ 0 | $ 0 |
Note 9 - Subsequent Events (Det
Note 9 - Subsequent Events (Details Textual) - USD ($) | Jul. 03, 2015 | Jul. 02, 2015 | Jul. 01, 2015 | Jun. 02, 2015 | May. 31, 2015 | May. 13, 2015 | Apr. 06, 2015 | Mar. 09, 2015 | Feb. 03, 2015 | Jan. 07, 2015 | Dec. 03, 2014 | Nov. 26, 2014 | Nov. 21, 2014 | Oct. 14, 2014 | Sep. 11, 2014 | Sep. 05, 2014 | Aug. 31, 2014 |
Subsequent Event [Member] | Board Member [Member] | Nine Notes [Member] | |||||||||||||||||
Subsequent Event [Line Items] | |||||||||||||||||
Convertible Notes Payable | $ 2,000,000 | ||||||||||||||||
Debt Instrument Convertible Conversion Price Percentage of Stock Price | 50.00% | ||||||||||||||||
Subsequent Event [Member] | Board Member [Member] | |||||||||||||||||
Subsequent Event [Line Items] | |||||||||||||||||
Debt Instrument, Face Amount | $ 44,117 | $ 44,117 | |||||||||||||||
Debt Instrument, Interest Rate, Stated Percentage | 10.00% | 10.00% | |||||||||||||||
Debt Instrument, Convertible, Conversion Price | $ 0.10 | $ 0.10 | |||||||||||||||
Subsequent Event [Member] | |||||||||||||||||
Subsequent Event [Line Items] | |||||||||||||||||
Common Stock, Shares Authorized | 450,000,000 | 450,000,000 | 300,000,000 | ||||||||||||||
Board Member [Member] | |||||||||||||||||
Subsequent Event [Line Items] | |||||||||||||||||
Debt Instrument, Interest Rate, Stated Percentage | 10.00% | 10.00% | 10.00% | 10.00% | 10.00% | 10.00% | 10.00% | 10.00% | 10.00% | ||||||||
Debt Instrument, Convertible, Conversion Price | $ 0.10 | $ 0.10 | $ 0.10 | $ 0.10 | $ 0.10 | $ 0.10 | $ 0.10 | $ 0.10 | $ 0.10 | ||||||||
Convertible Notes Payable | $ 50,000 | $ 50,000 | $ 300,000 | $ 50,000 | $ 50,000 | $ 84,000 | $ 216,000 | $ 100,000 | $ 150,000 | ||||||||
Debt Instrument Convertible Conversion Price Percentage of Stock Price | 50.00% | 50.00% | 50.00% | 50.00% | 50.00% | 50.00% | 50.00% | 50.00% | |||||||||
Debt Instrument, Interest Rate, Stated Percentage | 10.00% | 10.00% | |||||||||||||||
Debt Instrument, Convertible, Conversion Price | $ 0.10 | $ 0.10 | |||||||||||||||
Convertible Notes Payable | $ 500,000 | $ 450,000 | |||||||||||||||
Debt Instrument Convertible Conversion Price Percentage of Stock Price | 50.00% | 50.00% | |||||||||||||||
Common Stock, Shares Authorized | 450,000,000 | 450,000,000 |