Document_and_Entity_Informatio
Document and Entity Information (USD $) | 12 Months Ended | |
Dec. 31, 2014 | Jun. 30, 2014 | |
Document and Entity Information | ||
Entity Registrant Name | SPINDLE, INC. | |
Document Type | 10-K | |
Document Period End Date | 31-Dec-14 | |
Amendment Flag | FALSE | |
Entity Central Index Key | 1403802 | |
Current Fiscal Year End Date | -19 | |
Entity Common Stock, Shares Outstanding | 32,663,065 | |
Entity Filer Category | Smaller Reporting Company | |
Entity Current Reporting Status | Yes | |
Entity Voluntary Filers | No | |
Entity Well-known Seasoned Issuer | No | |
Document Fiscal Year Focus | 2014 | |
Document Fiscal Period Focus | FY | |
Entity Public Float | $51,670,269 |
Consolidated_Balance_Sheets
Consolidated Balance Sheets (USD $) | Dec. 31, 2014 | Dec. 31, 2013 |
Current assets: | ||
Cash | $169,807 | $700,323 |
Restricted cash | 20,000 | 20,000 |
Accounts receivable, net | 82,393 | 171,696 |
Prepaid Expenses and current deposits | 87,428 | 168,816 |
Inventory | 100,647 | 61,050 |
Total current assets | 460,275 | 1,121,885 |
Fixed assets, net | 22,145 | 27,370 |
Other assets | ||
License agreements, net | 116,346 | |
Domain names, net | 73,113 | 73,790 |
Capitalized software costs, net | 1,600,623 | 1,240,632 |
Residual contract revenue, net | 441,970 | 589,294 |
Deposits | 3,382 | 12,342 |
Goodwill, net | 5,306,205 | 2,679,970 |
Total other assets | 7,425,293 | 4,712,374 |
Total assets | 7,907,713 | 5,861,629 |
Current liabilities | ||
Accounts payable and accrued liabilities | 578,610 | 533,564 |
Advances | 215,000 | |
Accrued liabilities - related party | 681,655 | 129,351 |
Notes payable - related party, net | 172,108 | 143,442 |
Total current liabilities | 1,647,373 | 806,357 |
Total liabilities | 1,647,373 | 806,357 |
Stockholders' equity | ||
Preferred stock, value | ||
Common stock, value | 42,069 | 32,663 |
Common stock payable | 108 | 662 |
Additional paid-in capital | 21,470,580 | 11,401,078 |
Unamortized equity compensation | -48,736 | |
Accumulated deficit | -15,252,417 | -6,330,395 |
Total stockholders' equity | 6,260,340 | 5,055,272 |
Total liabilities and stockholders' equity | $7,907,713 | $5,861,629 |
Balance_Sheets_Parenthetical
Balance Sheets (Parenthetical) (USD $) | Dec. 31, 2014 | Dec. 31, 2013 |
Balance Sheets | ||
Allowance, accounts receivable | $11,250 | $10,967 |
Accumulated depreciation, fixed assets | 10,750 | 5,525 |
Accumulated amortization, license agreements | 116,347 | |
Accumulated amortization, domain names | 11,887 | 1,210 |
Accumulated amortization, software development | 582,017 | 199,646 |
Accumulated amortization, residual contract revenue | 147,324 | |
Accumulated impairment losses, goodwill | 669,993 | |
Debt discount, notes payable | $55 | $8,358 |
Preferred stock, par value | $0.00 | $0.00 |
Preferred stock, shares authorized | 50,000,000 | 50,000,000 |
Common stock, par value | $0.00 | $0.00 |
Common stock, shares authorized | 300,000,000 | 300,000,000 |
Common stock, shares issued | 42,068,773 | 32,663,065 |
Common stock, shares outstanding | 42,068,773 | 32,663,065 |
Common shares payable, unissued | 107,853 | 662,200 |
Consolidated_Statements_of_Ope
Consolidated Statements of Operations (USD $) | 12 Months Ended | |
Dec. 31, 2014 | Dec. 31, 2013 | |
Income Statement | ||
Sales income | $868,462 | $1,313,621 |
Cost of sales | 311,364 | 563,478 |
Gross profit | 557,098 | 750,143 |
Expenses: | ||
Depreciation and amortization | 592,135 | 244,818 |
Promotional and marketing | 126,215 | 81,783 |
Consulting | 2,377,212 | 1,053,417 |
Salaries and wages | 3,050,064 | 1,498,446 |
Director fees | 174,839 | 200,850 |
Professional fees | 1,100,240 | 808,882 |
General and administrative expenses | 566,618 | 492,315 |
Total operating expenses | 7,987,325 | 4,380,511 |
Net operating income (loss) | -7,430,227 | -3,630,368 |
Other income (expense) | ||
Interest expense, net | -2,214 | |
Interest expense - related party | -1,994 | -17,336 |
MeNetwork earnout settlement | -750,000 | |
Gain (loss) on settlement | -302,625 | |
Gain (loss) on settlement - related party | 238,761 | |
Gain (loss) on impairment of goodwill | -669,993 | |
Gain (loss) on impairment of long-lived asset | -69,808 | 63,864 |
Total other income (expense) | -1,491,795 | -83,414 |
Loss before provision for income taxes | -8,922,022 | -3,713,782 |
Provision for income taxes | ||
Net (loss) | ($8,922,022) | ($3,713,782) |
Weighted average number of common shares outstanding - basic and diluted | 38,349,031 | 26,094,975 |
Net (loss) per share - basic and diluted | ($0.23) | ($0.14) |
Consolidated_Statement_of_Stoc
Consolidated Statement of Stockholders' Equity (USD $) | Common Stock | Additional Paid-in Capital | Common Stock Payable | Unamortized Equity Compensation | Accumulated (Deficit) | Total |
Beginning Balance, amount at Dec. 31, 2012 | $18,428 | $3,835,683 | $2,514 | ($283,001) | ($2,616,613) | $957,011 |
Beginning Balance, shares at Dec. 31, 2012 | 18,427,919 | |||||
Shares issued for services, shares | 1,433,499 | |||||
Shares issued for services, value | 1,433 | 768,144 | 100 | 769,677 | ||
Shares issued for accounts payable, shares | 898,952 | |||||
Shares issued for accounts payable, value | 899 | 448,577 | 449,476 | |||
Shares issued for cash, shares | 5,865,000 | |||||
Shares issued for cash, value | 5,865 | 3,159,294 | 465 | 3,165,624 | ||
Shares issued for compensation, related party | 60,379 | 121 | 60,500 | |||
Shares issued in litigation settlement, shares | 1,424,075 | |||||
Shares issued in litigation settlement, value | 1,424 | -1,424 | ||||
Asset acquisition, shares | 2,750,000 | |||||
Asset acquisition, value | 2,750 | 3,129,000 | 750 | 3,132,500 | ||
Shares previously authorized, shares | 1,863,620 | |||||
Shares previously authorized, value | 1,864 | -1,864 | ||||
Stock option amortization | 234,266 | 234,266 | ||||
Net loss for the period | -3,713,782 | -3,713,782 | ||||
Ending Balance, amount at Dec. 31, 2013 | 32,663 | 11,401,077 | 662 | -48,735 | -6,330,395 | 5,055,272 |
Ending Balance, shares at Dec. 31, 2013 | 32,663,065 | |||||
Shares issued for services, shares | 1,798,458 | |||||
Shares issued for services, value | 1,799 | 2,919,655 | 8 | 2,921,471 | ||
Shares issued for cash, shares | 3,790,000 | |||||
Shares issued for cash, value | 3,790 | 1,941,110 | 100 | 1,945,000 | ||
Asset acquisition, shares | 1,642,000 | |||||
Asset acquisition, value | 1,642 | 3,003,218 | 3,004,860 | |||
Shares previously authorized, shares | 662,250 | |||||
Shares previously authorized, value | 662 | -662 | ||||
Stock option amortization | 593,774 | 48,735 | 642,509 | |||
Shares issued for compensation, shares | 513,000 | |||||
Shares issued for compensation, value | 513 | 862,737 | 863,250 | |||
Shares issued for MeNetwork amendment, shares | 1,000,000 | |||||
Shares issued for MeNetwork amendment, value | 1,000 | 749,000 | 750,000 | |||
Net loss for the period | -8,922,022 | -8,922,022 | ||||
Ending Balance, amount at Dec. 31, 2014 | $42,069 | $21,470,580 | $108 | ($15,252,417) | $6,260,340 | |
Ending Balance, shares at Dec. 31, 2014 | 42,068,773 |
Consolidated_Statements_of_Cas
Consolidated Statements of Cash Flows (USD $) | 12 Months Ended | |
Dec. 31, 2014 | Dec. 31, 2013 | |
Operating activities | ||
Net (loss) | ($8,922,022) | ($3,713,782) |
Adjustments to reconcile net loss to net cash (used) by operating activities: | ||
Shares issued for services | 2,553,973 | 752,950 |
Shares issued for officer compensation | 709,700 | 60,500 |
Shares issued for MeNetwork earnout | 750,000 | |
Depreciation and amortization | 592,135 | 244,818 |
Impairment of long-lived asset | 69,808 | |
Goodwill impairment | 669,993 | |
Amortization of debt discounts - related party | 2,999 | 14,908 |
Sharebased compensation expense | 796,058 | 173,766 |
(Gain) loss on settlement, net | 63,864 | |
Increase (decrease) in allowance for doubtful accounts | 283 | 10,967 |
Changes in operating assets and liabilities: | ||
(Increase) in accounts receivable | 89,019 | -134,334 |
(Increase) decrease in prepaid expenses | 118,430 | 35,869 |
(Increase) in inventory | -39,597 | -61,050 |
(Increase) decrease in interest receivable | 7,282 | |
(Increase) decrease in deposits and other assets | 8,960 | -8,500 |
Increase in accounts payable and accrued expenses | 375,505 | 741,729 |
(Decrease) increase in expenses - related party | 537,988 | |
(Decrease) increase in accrued interest | -9,449 | |
(Decrease) increase in accrued interest - related party | -5,019 | 5,019 |
Net cash (used in) operating activities | -1,691,787 | -1,815,443 |
Cash flows from investing activities | ||
Purchase of fixed assets | 13,786 | |
Acquisition of intellectual property | 501,367 | |
Purchase of domain name trademark | 75,000 | |
Additions to capitalized software development | 542,362 | 440,091 |
Net cash (used in) investing activities | -1,043,729 | -528,877 |
Cash flows from financing activities | ||
Payments on notes payable | 27,566 | |
Proceeds for advances | 215,000 | |
Proceeds for notes payable - related party | 45,000 | |
Payments on notes payable- related party | 205,000 | |
Proceeds from sale of common stock | 1,945,000 | 3,165,625 |
Net cash provided by financing activities | 2,205,000 | 2,933,059 |
Net increase (decrease) in cash | -530,516 | 588,739 |
Cash - beginning of the period | 700,323 | 111,584 |
Cash - ending of the period | 169,807 | 700,323 |
Supplemental disclosures: | ||
Interest paid | ||
Income taxes paid | ||
Non-cash transactions: | ||
Shares issued for services | 2,553,973 | 752,950 |
Shares issued for officer compensation | 709,700 | 60,500 |
Shares issued for prepaid expenses | 37,042 | |
Shares issued for accounts payable | 330,454 | 449,476 |
Shares issued for acquisitions | 3,004,861 | 3,132,500 |
Options issued for share based compensation expense | 642,508 | 173,766 |
Shares issued for share based compensation expense | 73,600 | |
Shares issued for MeNetwork earnout | $750,000 |
Organization_of_The_Company_an
Organization of The Company and Significant Accounting Policies | 12 Months Ended | |
Dec. 31, 2014 | ||
Notes | ||
Organization of The Company and Significant Accounting Policies | NOTE 1 - ORGANIZATION OF THE COMPANY AND SIGNIFICANT ACCOUNTING POLICIES | |
Organization | ||
We were originally incorporated in the State of Nevada on January 8, 2007 as “Coyote Hills Golf, Inc.” We were previously an online retailer of golf-related apparel, equipment and supplies. Prior to the acquisition of the assets of Spindle Mobile, Inc. (“Spindle Mobile”), as described below, we generated minimal revenues from the golf-related business. | ||
On December 2, 2011, we acquired certain assets and intellectual property from Spindle Mobile, a Delaware corporation in the business of data processing, mobile payments fields and other related fields, in exchange for approximately 80% of the issued and outstanding common stock of the Company, which shares were distributed to the stockholders of Spindle Mobile, pursuant to the terms and conditions of an Asset Purchase Agreement (the "Spindle Mobile Agreement"). | ||
Concurrent with the closing of the Spindle Mobile Agreement, we amended our articles of incorporation to change our name from "Coyote Hills Golf, Inc." to "Spindle, Inc." Additionally, we changed our authorized capital from 100,000,000 shares of common stock and 100,000,000 shares of preferred stock, $0.001 par value to 300,000,000 shares of common stock, $0.001 par value, and 50,000,000 preferred stock, $0.001 par value. The actions were approved on November 11, 2011, by the consent of the majority stockholders who represented 90% of our issued and outstanding common stock, and were effective on of December 2, 2011. | ||
On December 31, 2012 (the “Parallel Acquisition Closing Date”), pursuant to that certain Asset Purchase Agreement (the “Parallel Agreement”) by and between the Company and Parallel Solutions Inc., a Nevada corporation (“Parallel”), the Company acquired substantially all of Parallel’s assets used in connection with its business of facilitating electronic payment processing services to merchants (the “Parallel Assets”), assumed certain specified liabilities and hired seven employees of Parallel in exchange for 538,570 unregistered shares of common stock, of which 53,857 shares (the "Parallel Indemnification Escrow") and 100,000 shares (the "Parallel Deferred Consent Escrow”) were deposited in escrow with our transfer agent. The Parallel Indemnification Escrow was released on January 23, 2014. On October 29, 2013, the Parallel Deferred Consent Escrow was released to Parallel after certain specified contract assignments and residual revenue streams were assigned to the Company pursuant to the Parallel Agreement. | ||
On March 20, 2013 (the “MeNetwork Closing Date”), the Company assumed certain liabilities and acquired substantially all of the assets of MeNetwork, Inc., a Delaware corporation (“MeNetwork”), used in connection with its business of developing, marketing and licensing a mobile marketing platform for use by merchants and consumers (the “MeNetwork Assets”), pursuant to an Asset Purchase Agreement dated March 1, 2013 by and between Spindle and MeNetwork (the “MeNetwork Agreement”). As consideration for the assumption of the liabilities and the acquisition of the MeNetwork Assets, the Company issued an aggregate of 2,750,000 shares of common stock to the stockholders of MeNetwork, of which 350,000 were deposited in escrow with our transfer agent for the purposes of satisfying any indemnification claims. The MeNetwork Indemnification Escrow was released pursuant to the MeNetwork Agreement. On October 7, 2013, the Company issued an additional 750,000 shares of common stock to Ashton Craig Page, the former director and Chief Operating Officer of MeNetwork and a former director of the Company, pursuant to the terms and conditions of the MeNetwork Agreement. On December 12, 2014, the Company, and Ashton Craig Page, in his capacity as the representative of MeNetwork and the MeNetwork Stockholders (the “Representative”), entered into an Amendment and Waiver to Asset Purchase Agreement (the "Amendment), pursuant to which the Company agreed to issue and the Representative agreed to accept on behalf of MeNetwork and the MeNetwork Stockholders an acceleration of the issuance of up to an aggregate of 1,000,000 Earnout Shares on or before December 31, 2014 in full satisfaction of all obligations of the Company to issue the Earnout Shares pursuant to the Purchase Agreement during the Earnout Period. These shares were issued on December 23, 2014. | ||
On January 3, 2014 (the “Closing Date”), the Company acquired substantially all of the assets of Yowza International Inc. (renamed Y Dissolution, Inc.) (“Yowza!!) used in connection with its business of providing retail coupons through a mobile application (the “Yowza Assets”), and assumed certain liabilities of Yowza!! in an amount equal to $15,000 for consideration equal to (1) $500,000 in cash paid to Yowza!! and certain creditors and holders of outstanding promissory notes issued by Yowza!! and (2) an aggregate of 1,642,000 unregistered shares of our common stock (the “Aggregate Share Consideration”), issuable to the holders of Yowza!!’s outstanding capital stock. Ten percent of the Aggregate Share Consideration is issuable to certain executive management members and advisors of Yowza!! in accordance with consulting or employment agreements and subject to certain vesting provisions. In addition, an aggregate of 197,052 shares of common stock (the “Indemnification Escrow”), representing approximately 12% of the Aggregate Share Consideration, was deposited in escrow for a period of one year from the Closing Date. The Yowza!! Indemnification Escrow was released on January 12, 2015. The Indemnification Escrow is available to compensate Spindle pursuant to the indemnification obligations of Yowza!! under the Asset Purchase Agreement, and for any necessary accounts receivable adjustment after the Closing Date in the event Spindle is unable to collect the acquired outstanding accounts receivable of Yowza!! within 120 days after the Closing Date. | ||
Reclassifications | ||
Certain reclassifications have been made to the prior years’ financial statements to conform to the current year presentation. These reclassifications had no effect on previously reported results of operations or retained earnings. | ||
Principles of consolidation | ||
For the fiscal years ended December 31, 2014 and 2013, the consolidated financial statements include the accounts of Spindle, Inc. and Spindle Mobile, Inc. All significant intercompany balances and transactions have been eliminated. Spindle, Inc. and Spindle Mobile, Inc. will be collectively referred herein to as the “Company”. | ||
Summary of significant accounting policies | ||
Cash and cash equivalents | ||
For purpose of the statements of cash flows, the Company considers cash and cash equivalents to include all stable, highly liquid investments with maturities of three months or less. | ||
Concentration of credit risk | ||
The Company primarily transacts its business with one financial institution. The amount on deposit in that one institution may from time to time exceed the federally-insured limit. | ||
Use of estimates | ||
The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. | ||
Income taxes | ||
The Company accounts for its income taxes under the provisions of ASC Topic 740, “Income Taxes.” The method of accounting for income taxes under ASC 740 is an asset and liability method. The asset and liability method requires the recognition of deferred tax liabilities and assets for the expected future tax consequences of temporary differences between tax bases and financial reporting bases of other assets and liabilities. | ||
Revenue recognition | ||
Revenue is derived on a per message/notification basis through the Company’s patented technologies and a modular, adaptable platform designed to create multi-channel messaging gateways for all types of connected devices. The Company also earns revenue for services, such as programming, licensure on SaaS basis, and on a performance basis, such as when a client acquires a new customer through our platform. Revenue is recognized in accordance with Staff Accounting Bulletin (“SAB”) No. 101, “Revenue Recognition in Financial Statements,” as revised by SAB No. 104. As such, the Company recognizes revenue when persuasive evidence of an arrangement exists, title transfer has occurred, the price is fixed or readily determinable, and collectability is probable. Sales are recorded net of sales discounts. | ||
Restricted cash | ||
The Company maintains a restricted cash balance as part of its operating requirements in a non-interest-bearing account that currently does not exceed federally insured limits totaling $20,000. | ||
Accounts receivable | ||
Accounts receivable is reported at the customers’ outstanding balances, less any allowance for doubtful accounts. Interest is not accrued on overdue accounts receivable. | ||
Allowance for doubtful accounts | ||
An 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 information collected from individual customers. Accounts receivable are charged off against the allowance when collectability is determined to be permanently impaired. | ||
Inventory | ||
Inventories consist of merchandise held for sale in the ordinary course of business, including cost of freight and other miscellaneous acquisition costs, and are stated at the lower of cost or market. The Company records a write-down for inventories, which have become obsolete or are in excess of anticipated demand or net realizable value. The Company performs a detailed review of inventory each period that considers multiple factors including demand forecasts, market conditions, product life cycle status, product development plans and current sales levels. If future demand or market conditions for the Company’s products are less favorable than forecasted or if unforeseen changes negatively affect the utility of the Company’s inventory, it may be required to record additional write-downs, which would negatively affect gross margins in the period when the write-downs are recorded. If actual market conditions are more favorable, the Company may have higher gross margins when products incorporating inventory that were previously written down are sold. | ||
Property and equipment | ||
Property and equipment are stated at cost. Major renewals and improvements are charged to the asset accounts while replacements, maintenance and repairs that do not improve or extend the lives of the respective assets are expensed. At the time property and equipment are retired or otherwise disposed of, the asset and related accumulated depreciation accounts are relieved of the applicable amounts. Gains or losses from retirements or sales are credited or charged to income. | ||
Depreciation is computed on the straight-line and accelerated methods for financial reporting and income tax reporting purposes based upon the following estimated useful lives: | ||
Computer Software | 3 years | |
Computer Equipment | 5 years | |
Office furniture and equipment | 7 years | |
Long-lived assets | ||
The Company accounts for its long-lived assets in accordance with ASC Topic 360-10-05, “Accounting for the Impairment or Disposal of Long-Lived Assets.” ASC Topic 360-10-05 requires that long-lived assets be reviewed for impairment whenever events or changes in circumstances indicate that the historical cost carrying value of an asset may no longer be appropriate. The Company assesses recoverability of the carrying value of an asset by estimating the future net cash flows expected to result from the asset, including eventual disposition. If the future net cash flows are less than the carrying value of the asset, an impairment loss is recorded equal to the difference between the asset’s carrying value and fair value or disposable value. The Company recorded an impairment to its intellectual property for the year ended December 31, 2014 as further discussed in Note 6. | ||
Goodwill | ||
The Company accounts for goodwill in accordance with ASC Topic 805-30-25, “Accounting for Business Combinations” and ASC Topic 350-20-35, “Accounting for Goodwill - Subsequent Measurement”. | ||
ASC Topic 805-30 requires that the acquirer shall recognize goodwill as of the acquisition date as the excess of the fair value of the consideration transferred over the fair value of the net acquisition-date amounts of the identifiable assets and liabilities assumed. | ||
ASC Topic 350-20-35 requires that goodwill acquired in a purchase and determined to have an indefinite useful life is not amortized, but instead tested for impairment annually or more frequently when events or circumstances indicates that the carrying value of a reporting unit more likely than not exceeds its fair value. The Company’s annual goodwill impairment testing date is December 31 of each year. The Company first assesses qualitative factors to determine whether it’s necessary to perform the two-step goodwill impairment test. Impairment is the condition that exists when the carrying amount of goodwill exceeds its implied fair value. If the qualitative assessment results in an indication that it’s more likely than not that the fair value of a reporting unit is less than its carrying amount, then a quantitative assessment must be performed. Management has determined that the Company has one reporting unit for purposes of testing goodwill. | ||
The quantitative analysis involves estimating the fair value of its reporting unit utilizing a combination of valuation methods including market capitalization, the income approach and cash flows. Income and cash flow forecasts were used in the evaluation of goodwill based on management’s estimate of future performance. If goodwill is determined to be impaired as a result of this analysis, an impairment loss is recorded equal to the difference between the asset’s carrying value and fair value. The Company recorded an impairment to its goodwill for the year ended December 31, 2014 as further discussed in Note 9. | ||
Capitalized software development costs | ||
The Company capitalizes internal software development costs subsequent to establishing technological feasibility of a software application. Capitalized software development costs represent the costs associated with the internal development of the Company’s software applications. Amortization of such costs is recorded on a software application-by-application basis, based on the greater of the proportion of current year sales to total of current and estimated future sales for the applications or the straight-line method over the remaining estimated useful life of the software application. The Company continually evaluates the recoverability of capitalized software costs and will charge to operations amounts that are deemed unrecoverable for projects it abandons. | ||
Stock-based compensation | ||
The Company accounts for stock-based payments to employees in accordance with ASC 718, “Stock Compensation” (“ASC 718”). Stock-based payments to employees include grants of stock, grants of stock options and issuance of warrants that are recognized in the consolidated statement of operations based on their fair values at the date of grant. | ||
The Company accounts for stock-based payments to non-employees in accordance with ASC 505-50, “Equity-Based Payments to Non-Employees.” Stock-based payments to non-employees include grants of stock, grants of stock options and issuances of warrants that are recognized in the consolidated statement of operations based on the value of the vested portion of the award over the requisite service period as measured at its then-current fair value as of each financial reporting date. The Company calculates the fair value of option grants and warrant issuances utilizing the Binomial pricing model. The amount of stock-based compensation recognized during a period is based on the value of the portion of the awards that are ultimately expected to vest. ASC 718 requires forfeitures to be estimated at the time stock options are granted and warrants are issued to employees and non-employees, and revised, if necessary, in subsequent periods if actual forfeitures differ from those estimates. The term “forfeitures” is distinct from “cancellations” or “expirations” and represents only the unvested portion of the surrendered stock option or warrant. | ||
The Company estimates forfeiture rates for all unvested awards when calculating the expense for the period. In estimating the forfeiture rate, the Company monitors both stock option and warrant exercises as well as employee termination patterns. The resulting stock-based compensation expense for both employee and non-employee awards is generally recognized on compensation under ASC Topic 505-50, In accordance with ASC 505-50, the cost of stock-based compensation is measured at the grant date based on the value of the award and is recognized over the vesting period. The value of the stock-based award is determined using the Binomial or Black-Scholes option-pricing models, whereby compensation cost is the excess of the fair value of the award as determined by the pricing model at the grant date or other measurement date over the amount that must be paid to acquire the stock. | ||
Loss per share | ||
The Company reports earnings (loss) per share in accordance with ASC Topic 260-10, "Earnings per Share." Basic earnings (loss) per share is computed by dividing income (loss) available to common shareholders by the weighted average number of common shares available. Diluted earnings (loss) per share is computed similar to basic earnings (loss) per share except that the denominator is increased to include the number of additional common shares that would have been outstanding if the potential common shares had been issued and if the additional common shares were dilutive. Diluted earnings (loss) per share has not been presented since the effect of the assumed conversion of warrants and debt to purchase common shares would have an anti-dilutive effect. Potential common shares as of December 31, 2014 that have been excluded from the computation of diluted net loss per share amounted to 3,710,834 shares and include 250,000 warrants and 3,460,834 options. Of the 3,460,834 potential common shares at December 31, 2014, 1,342,500 had not vested. | ||
Fair value of financial instruments | ||
Fair value estimates discussed herein are based upon certain market assumptions and pertinent information available to management as of December 31, 2014 and 2013. The respective carrying value of certain on-balance-sheet financial instruments approximated their fair values. Fair values were assumed to approximate carrying values for cash and payables because they are short term in nature and their carrying amounts approximate fair values or they are payable on demand. | ||
Year-end | ||
The Company’s year-end is December 31. | ||
Recent Accounting Pronouncements | ||
The Company continually assesses any new accounting pronouncements to determine their applicability to the Company. Where it is determined that a new accounting pronouncement affects the Company’s financial reporting, the Company undertakes a study to determine the consequence of the change to its financial statements and assures that there are proper controls in place to ascertain that the Company’s financials properly reflect the change. | ||
In August 2014, The FASB issued ASU No. 2014-15, “Presentation of Financial Statements - Going Concern (Subtopic 205-40).” ASU 2014-15 provides guidance for disclosure of uncertainties about an entity’s ability to continue as a going concern. In doing so, management will need to perform an evaluation at each interim and annual reporting period to determine whether or not there are conditions or events, considered in the aggregate, that raise substantial doubt about the entity’s ability to continue as a going concern within one year after the date that the financial statements are issued. If these conditions exist, the entity should evaluate whether the doubt is mitigated by management’s plans or events and should make such required disclosures. This guidance will be effective for the Company for its interim reporting for the quarter ended March 31, 2017. |
Going_Concern
Going Concern | 12 Months Ended |
Dec. 31, 2014 | |
Notes | |
Going Concern | NOTE 2 - GOING CONCERN |
The accompanying financial statements have been prepared assuming the Company will continue as a going concern. As shown in the accompanying financial statements, the Company has incurred a net loss of ($8,922,022) and ($3,713,782) for the fiscal years ended December 31, 2014 and 2013, respectively and has an accumulated deficit of ($15,252,417). | |
In order to continue as a going concern, the Company will need, among other things, additional capital resources. The Company is significantly dependent upon its ability, and will continue to attempt, to secure equity and/or additional debt financing. The Company has recently issued debt securities and may conduct an offering of its equity securities to raise proceeds to finance its plan of operation. There are no assurances that the Company will be successful and without sufficient financing it would be unlikely for the Company to continue as a going concern. | |
The financial statements do not include any adjustments relating to the recoverability and classification of recorded assets, or the amounts of and classification of liabilities that might be necessary in the event the Company cannot continue in existence. These conditions raise substantial doubt about the Company's ability to continue as a going concern. These financial statements do not include any adjustments that might arise from this uncertainty. |
Accounts_Receivable_Disclosure
Accounts Receivable Disclosure | 12 Months Ended | |||||
Dec. 31, 2014 | ||||||
Notes | ||||||
Accounts Receivable Disclosure | NOTE 3 - ACCOUNTS RECEIVABLE | |||||
Accounts receivable consist of the following: | ||||||
December 31, | December 31, | |||||
2014 | 2013 | |||||
Due from customers | $ | 93,643 | $ | 182,663 | ||
Less allowance for bad debts | -11,250 | -10,967 | ||||
Total accounts receivable, net | $ | 82,393 | $ | 171,696 | ||
Prepaid_Expenses_and_Deposits_
Prepaid Expenses and Deposits, Note | 12 Months Ended |
Dec. 31, 2014 | |
Notes | |
Prepaid Expenses and Deposits, Note | NOTE 4 - PREPAID EXPENSES AND DEPOSITS |
On February 7, 2012, the Company entered into a legal retainer agreement with a law firm, for which the Company paid a legal retainer of $5,000. The retainer will be expensed at the sole discretion of the law firm and all ongoing legal fees are billed to the Company as incurred. During the year ended December 31, 2013, the Company recognized legal expenses of $623,423. As of December 31, 2013, the entire amount of the retainer has been amortized. | |
During 2012, the Company entered into a business marketing agreement for term of one year. In accordance with the terms of each agreement, the Company issued 350,000 fully vested shares of common stock valued at $175,000 as a non-refundable retainer for services. The estimated fair value will be amortized on a straight-line basis of the term of the agreement. As of December 31, 2013, the Company recorded $122,500 as consulting expense related to the service and the entire amount of the retainer has been amortized. | |
On January 23, 2013, the Company entered into a public relations consulting agreement for a term of two years. In accordance with the terms of the agreement, the Company issued 500,000 fully vested shares of common stock on the date of agreement and an additional 340,000 shares during the remainder of 2013. The fair value of the complete grant totaled $420,000 and the first phase of the agreement has been completed. The Company renewed the agreement in early 2014, and as of September 30, 2014, has issued 700,000 shares for the annual agreement period at a fair value of $1,109,500. As a result, $1,075,438 was recorded to consulting expense related to the service for the year ended December 31, 2014 respectively. The remaining prepaid balance at December 31, 2014 totaled $37,042. |
Fixed_Assets_Disclosure
Fixed Assets Disclosure | 12 Months Ended | |||||
Dec. 31, 2014 | ||||||
Notes | ||||||
Fixed Assets Disclosure | NOTE 5 - FIXED ASSETS | |||||
Fixed assets consisted of the following at: | ||||||
DECEMBER 31, | DECEMBER 31, | |||||
2014 | 2013 | |||||
Office furniture & equipment | $ | 32,895 | $ | 32,895 | ||
Less: accumulated depreciation | -10,750 | -5,525 | ||||
Total fixed assets, net | $ | 22,145 | $ | 27,370 | ||
During the years ended December 31, 2014 and December 31, 2013, the Company recorded depreciation expense of $5,225 and $3,494, respectively. |
Capitalized_Software_Costs_and
Capitalized Software Costs and Intellectual Property | 12 Months Ended | |||||
Dec. 31, 2014 | ||||||
Notes | ||||||
Capitalized Software Costs and Intellectual Property | NOTE 6 - CAPITALIZED SOFTWARE COSTS AND INTELLECTUAL PROPERTY | |||||
Capitalized software costs and license agreements consisted of the following at: | ||||||
DECEMBER 31, | DECEMBER 31, | |||||
2014 | 2013 | |||||
Capitalized software costs | $ | 2,182,640 | $ | 1,440,278 | ||
Less: accumulated amortization | -582,017 | -199,646 | ||||
Net capitalized software costs | 1,600,623 | 1,240,632 | ||||
License agreements | 69,808 | 232,693 | ||||
Accumulated impairment loss | -69,808 | -- | ||||
Less: accumulated depreciation | -- | -116,347 | ||||
Net licenses | -- | 116,346 | ||||
Total intellectual property, net | $ | 1,600,623 | $ | 1,356,978 | ||
During the year ended December 31, 2014, management reviewed the carrying amount of the assets and determined as a result of diversification in the Company’s business model due to its acquisitions, the license agreements previously recorded no longer yielded a net future cash flow. As a result of this analysis, the Company recorded, to other expense, an impairment loss of $69,808 in accordance with ASC Topic 360-10-05. |
Domain_Names_Disclosure
Domain Names Disclosure | 12 Months Ended | |||||
Dec. 31, 2014 | ||||||
Notes | ||||||
Domain Names Disclosure | NOTE 7 - DOMAIN NAMES | |||||
Domain names consisted of the following at: | ||||||
DECEMBER 31, | DECEMBER 31, | |||||
2014 | 2013 | |||||
Domain names | $ | 85,000 | $ | 75,000 | ||
Less: accumulated amortization | -11,887 | -1,210 | ||||
Total domain names, net | $ | 73,113 | $ | 73,790 | ||
Residual_Contracts_Disclosure
Residual Contracts Disclosure | 12 Months Ended | |||||
Dec. 31, 2014 | ||||||
Notes | ||||||
Residual Contracts Disclosure | NOTE 8 - RESIDUAL CONTRACTS | |||||
On December 31, 2012, the Company acquired the residual income stream of Parallel Solutions Inc. (PSI). This revenue is perpetual, provided that the vendor’s contract with PSI is not terminated. The calculations for the value associated with anticipated new income resulting from the acquired PSI residual contracts was determined based on PSI’s residual revenue stream for the period from November of 2011 to October 2012 of $535,722 and historical PSI’s termination rates of nil. The Company used the lowest industry standard multiple of (1.1) to determine the fair value of the contractual revenue stream of the date of acquisition which was estimated to be $589,294. During the year ended December 31, 2014, management reviewed the carrying amount of the asset and determined as a result of diversification in the Company’s business model due to its acquisitions, that the previously estimated indefinite life be revised to reflect the Company’s future business development goals. The Company estimated a finite remaining useful life of forty-eight months and has recorded amortization expense as of December 31, 2014 as follows: | ||||||
DECEMBER 31, | DECEMBER 31, | |||||
2014 | 2013 | |||||
Residual contracts | $ | 589,294 | $ | 589,294 | ||
Less: accumulated amortization | -147,324 | -- | ||||
Total residual contracts, net | $ | 441,970 | $ | 589,294 | ||
Goodwill_Disclosure
Goodwill Disclosure | 12 Months Ended | |||||
Dec. 31, 2014 | ||||||
Notes | ||||||
Goodwill Disclosure | NOTE 9 - GOODWILL | |||||
DECEMBER 31, | DECEMBER 31, | |||||
2014 | 2013 | |||||
Goodwill | $ | 5,976,198 | $ | 2,679,970 | ||
Less: accumulated impairment loss | -669,993 | -- | ||||
Total goodwill, net | $ | 5,306,205 | $ | 2,679,970 | ||
In connection with the acquisition (as further described in Note 13) on March 20, 2013, the Company assumed certain liabilities and acquired substantially all of the assets of MeNetwork. The Company recorded goodwill related to this acquisition of $2,679,970. During its annual evaluation of goodwill, the Company determined that the carrying amount of goodwill related to MeNetwork, exceeded its fair value. As a result the Company recorded an impairment loss, to other expense, of $669,993 during the year ended December 31, 2014. This charge reflects the impact of partially sun setting assets acquired from MeNetwork in conjunction with its integration of Yowza!! | ||||||
In connection with the acquisition (as further described in Note 13) on January 3, 2014, the Company assumed certain liabilities and acquired substantially all of the assets of Yowza!!. The Company recorded goodwill related to this acquisition of $3,291,932. During its annual evaluation of goodwill, the Company determined that the fair value of goodwill exceeded its carrying amount and as a result no impairment charge was recorded. |
Notes_Payable_Related_Party_Di
Notes Payable - Related Party, Disclosure | 12 Months Ended |
Dec. 31, 2014 | |
Notes | |
Notes Payable - Related Party, Disclosure | NOTE 10- NOTES PAYABLE - RELATED PARTY |
On December 15, 2011, the Company issued a Promissory Grid Note to a director of the Company whereby formalizing various advances previously received from the director in the amount of $51,300 and allowing for future advances up to $250,000. The note is non-interest bearing, unsecured and matures on December 15, 2014. The Company imputed interest at a rate of 2% per annum and recorded a discount in the amount of $10,640. In connection with one of the previous advances in the amount of $25,000, the Company issued warrants to purchase up to 250,000 shares of the Company’s common stock at a price per share of $1.00 resulting in an additional discount of $17,709. The total discount attributable to the Grid Note totaled $28,349 and is being amortized to interest expense over the term of the note. During the year ended December 31, 2014, the Company repaid $55,000 of the principal balance of the loan. As of December 31, 2014, this note has not been repaid in accordance with the note and the Company is process of negotiating new terms on the unpaid balance. | |
During the year ended December 31, 2014, the Company recorded a $100,000 note payable to a director of the Company. The note is non-interest bearing and unsecured. The Company imputed interest at a rate of 2% per annum and recorded a discount in the amount of $110. | |
During the years ended December 31, 2014 and December 31, 2013, respectively, interest expense of $1,994 and $17,336 related to amortization of the discount and interest on the unpaid notes was recorded. |
Stockholders_Equity_Disclosure
Stockholders' Equity Disclosure | 12 Months Ended |
Dec. 31, 2014 | |
Notes | |
Stockholders' Equity Disclosure | NOTE 11 - STOCKHOLDERS’ EQUITY |
The Company is authorized to issue up to 300,000,000 shares of common stock, par value $0.001. | |
During the year ended December 31, 2013, the Company issued 550,000 shares of its common stock previously authorized for services rendered and unissued at December 31, 2012. In addition, on October 7, 2013, the Company issued an additional 750,000 shares of common stock to Ashton Craig Page, the former director and Chief Operating Officer of MeNetwork and a current director of the Company, pursuant to the terms and conditions of the MeNetwork Agreement. | |
During the year ended December 31, 2013, the Company authorized the issuance of 6,331,250 shares of its common stock for cash proceeds totaling $3,165,625. As of December 31, 2013, 466,250 shares were unissued. | |
During the year ended December 31, 2013, the Company issued a total of 840,000 shares of common stock pursuant to a two year consulting agreement. The estimated fair value of the shares totaled $420,000 and the entire amount has been expensed to consulting fees. The agreement has been renewed for a subsequent year and the remaining compensation in the form of common stock will be issued in the upcoming year. | |
During the year ended December 31, 2013, the Company issued 898,952 shares of its common stock as payment for previously accrued legal fees. The estimated fair value of the shares totaled $449,476 and has been recorded as a reduction to accounts payable. | |
On March 20, 2013, the Company authorized the issuance of 3,500,000 shares with an estimated fair value of $3,132,500 in connection with an asset acquisition. The Company agrees to issue 750,000 of such shares upon the satisfaction of certain conditions. (See Note 13). As of December 31, 2013, the 750,000 shares were issued. | |
On November 27, 2013, the Company issued 1,424,075 shares from previously unissued shares with an estimated fair value of $712,038 toward settlement of litigation concerning Spindle Mobile. In exchange for the shares, notes receivable in the aggregate amount of $288,040 and a note payable of $221,287 (including accrued interest) that were related to the parties were extinguished and a release from claims was executed between the parties. | |
During the year ended December 31, 2013, the Company authorized the issuance of 121,000 shares of common stock to the chief executive officer as compensation for services. | |
On January 3, 2014, the Company authorized the issuance of 1,642,000 shares with an estimated fair value of $3,004,861 in connection with an asset acquisition. The Company issued 1,445,000 shares at closing (see Note 13). As of December 31, 2014, 197,052 shares remain in escrow. | |
During the year ended December 31, 2014, the Company authorized the issuance of 3,890,000 shares of its common stock for cash proceeds totaling $1,945,000. As of December 31, 2014, 2,890,000 of these shares were issued and 100,000 of these shares were unissued. | |
During the year ended December 31, 2014, the Company issued a total of 1,253,353 shares of common stock to various individuals and companies for services valued at $2,108,945. Of the total fair value, $24,750 has been recorded as a reduction to accounts payable, $37,042 is recorded as a prepaid expense and $2,047,153 was recognized as additional paid-in-capital and consulting expense for the excess of the fair value. As of December 31, 2014, 7,853 of these shares were unissued. Additionally, the Company also canceled 50,000 shares previously issued for consulting services in 2012 for services valued at $4,000. | |
During the year ended December 31, 2014, the Company issued 602,958 shares of its common stock as payment for previously accrued legal fees. The estimated fair value of these shares totaled $816,524. Of the total fair value, $305,704 has been recorded as a reduction to accounts payable and $510,820 was recognized as additional paid-in-capital and professional fees expense for the excess of the fair value. | |
During the year ended December 31, 2014, the Company authorized the issuance of 338,000 shares of common stock valued at $680,700 to the Chief Executive Officer as compensation for services and bonus. | |
During the year ended December 31, 2014, the Company authorized the issuance of 20,000 shares of common stock valued at $29,000 to the former Chief Financial Officer as compensation for services. | |
During the year ended December 31, 2014, the Company authorized the issuance of 155,000 shares of common stock valued at $153,550 to various employees as compensation for services and bonus. |
Warrants_and_Options_Disclosur
Warrants and Options Disclosure | 12 Months Ended | |||||
Dec. 31, 2014 | ||||||
Notes | ||||||
Warrants and Options Disclosure | NOTE 12 - WARRANTS AND OPTIONS | |||||
On October 29, 2012, our stockholders approved the 2012 Stock Incentive Plan (the “Plan”) that governs equity awards to our management, employees, directors and consultants. On November 7, 2013, our stockholders approved an amendment to the Plan which increased the total authorized amount of common stock issuable under the Plan from 3,000,000 to 6,000,000 shares. | ||||||
During 2013 the Company granted 322,000 options to officers, employees and directions to purchase shares of common stock at an exercise price of $0.50 per share, with grant date fair values of $0.77 to $1.36. The options vest ratably on an annual basis over one to three years. The options expire ten years from grant date. | ||||||
During 2014 the Company granted 3,006,000 options to officers, employees and directors to purchase shares of common stock at an exercise price of $0.50 per share, with grant date fair values of $0.51 to $1.87. The options vest ratably on an annual basis over three years. The options expire ten years from grant date. | ||||||
The estimated fair values of options granted during 2014 and 2013 were calculated using the following assumptions: | ||||||
2014 | 2013 | |||||
Dividend yield | 0.00% | 0.00% | ||||
Expected volatility | 76.71% to 86.26% | 63.64% to 72.80% | ||||
Risk free interest rate | 1.49% to 1.78% | 0.77% to 1.66% | ||||
Expected term, in years | 6 | 5.50 to 6.0 | ||||
The following is a summary of the status of all of the Company’s stock warrants and options as of December 31, 2014: | ||||||
Number of Warrants | Weighted-Average | Weighted-Average | ||||
and Options | Exercise Price | Remaining | ||||
Contractual | ||||||
Life (in years) | ||||||
Outstanding at December 31, 2012 | 2,515,000 | $ | 0.549 | |||
Granted | 697,000 | - | ||||
Exercised | - | - | ||||
Forfeited/Cancelled | -236,000 | - | ||||
Outstanding at December 31, 2013 | 2,976,000 | $ | 0.549 | 7.86 | ||
Exercisable at December 31, 2014 | 1,999,550 | $ | 0.581 | 8.71 | ||
Outstanding at December 31, 2013 | 2,976,000 | $ | 0.549 | 7.86 | ||
Granted | 2,392,500 | - | ||||
Exercised | - | - | ||||
Forfeited/Cancelled | -1,657,666 | - | ||||
Outstanding at December 31, 2014 | 3,710,834 | $ | 0.534 | 7.09 | ||
Exercisable at December 31, 2014 | 2,368,334 | $ | 0.553 | 6.33 | ||
Business_Acquisitions_Note
Business Acquisitions, Note | 12 Months Ended | |||
Dec. 31, 2014 | ||||
Notes | ||||
Business Acquisitions, Note | NOTE 13 - BUSINESS ACQUISITIONS | |||
On December 31, 2012 (the “Parallel Acquisition Closing Date”), pursuant to that certain Asset Purchase Agreement (the “Parallel Agreement”) by and between the Company and Parallel Solutions Inc., a Nevada corporation (“Parallel”), the Company acquired substantially all of Parallel’s assets used in connection with its business of facilitating electronic payment processing services to merchants (the “Parallel Assets”), assumed certain specified liabilities and hired seven employees of Parallel in exchange for 538,570 unregistered shares of common stock, of which 53,857 shares (the “Parallel Indemnification Escrow”) and 100,000 shares (the “Parallel Deferred Consent Escrow”) were deposited in escrow with our transfer agent. The Parallel Indemnification Escrow was released on January 23, 2014. On October 29, 2013, the Parallel Deferred Consent Escrow was released to Parallel after certain specified contract assignments and residual revenue streams were assigned to the Company pursuant to the Parallel Agreement. | ||||
On March 20, 2013 (the “MeNetwork Closing Date”), the Company assumed certain liabilities and acquired substantially all of the assets of MeNetwork used in connection with its business of developing, marketing and licensing a mobile marketing platform for use by merchants and consumers (the “MeNetwork Assets”), pursuant to an Asset Purchase Agreement dated March 1, 2013 by and between Spindle and MeNetwork (the “MeNetwork Agreement”). As consideration for the assumption of the liabilities and the acquisition of the MeNetwork Assets, the Company issued an aggregate of 2,750,000 shares of common stock to the stockholders of MeNetwork, of which 350,000 shares are being held in escrow for a period of one year from the MeNetwork Closing Date for the purposes of satisfying any indemnification claims. In addition, on October 7, 2013, the Company issued an additional 750,000 shares of common stock to Ashton Craig Page, the former director and Chief Operating Officer of MeNetwork and a current director of the Company, pursuant to the terms and conditions of the MeNetwork Agreement. On December 12, 2014, the Company, and Ashton Craig Page, in his capacity as the representative of MeNetwork and the MeNetwork Stockholders (the “Representative”), entered into an Amendment and Waiver to Asset Purchase Agreement (the "Amendment), pursuant to which the Company agreed to issue and the Representative agreed to accept on behalf of MeNetwork and the MeNetwork Stockholders an acceleration of the issuance of up to an aggregate of 1,000,000 Earnout Shares on or before December 31, 2014 in full satisfaction of all obligations of the Company to issue the Earnout Shares pursuant to the Purchase Agreement during the Earnout Period. These shares were issued on December 23, 2014. | ||||
Yowza!! Transaction | ||||
As described in Note 1, “Organization of the Company and Signficant Accounting Policies” the Company completed the Yowza!! Transaction on January 3, 2014. This transaction was accounted for as a business combination. As such, the Company has allocated the purchase price in accordance with ASC Topic 850-30 as previously described in the Company’s significant accounting policies. Consideration was determined as follows: | ||||
Fair Value of | ||||
Consideration | ||||
Transferred | ||||
Cash paid to Yowza!!, net of cash acquired | $ | 500,000 | ||
Fair value of Company's shares issued | 3,004,860 | |||
Cash paid to extinguish debt, net of cash acquired | -13,632 | |||
$ | 3,491,228 | |||
The fair value of our shares issued in connection with the Yowza!! Transaction was determined to be $1.83, which was the fair value of the shares on the closing date of the acquisition. | ||||
The Company’s allocation of the purchase price is as follows: | ||||
Net assets acquired: | ||||
Cash | $ | 1,368 | ||
Accounts receivable | 2,928 | |||
Software development costs | 200,000 | |||
Trademarks | 10,000 | |||
Net liabilities assumed: | ||||
Accounts payable | -15,000 | |||
Goodwill | 3,291,932 | |||
Total purchase price | $ | 3,491,228 | ||
Subsequent_Events
Subsequent Events | 12 Months Ended |
Dec. 31, 2014 | |
Notes | |
Subsequent Events | NOTE 14 - SUBSEQUENT EVENTS |
The Company’s management has reviewed all material events through the date of this report in accordance with ASC 855-10, and believes there are no material subsequent events to report. |
Organization_of_The_Company_an1
Organization of The Company and Significant Accounting Policies: Reclassifications (Policies) | 12 Months Ended |
Dec. 31, 2014 | |
Policies | |
Reclassifications | Reclassifications |
Certain reclassifications have been made to the prior years’ financial statements to conform to the current year presentation. These reclassifications had no effect on previously reported results of operations or retained earnings. |
Organization_of_The_Company_an2
Organization of The Company and Significant Accounting Policies: Principles of Consolidation (Policies) | 12 Months Ended |
Dec. 31, 2014 | |
Policies | |
Principles of Consolidation | Principles of consolidation |
For the fiscal years ended December 31, 2014 and 2013, the consolidated financial statements include the accounts of Spindle, Inc. and Spindle Mobile, Inc. All significant intercompany balances and transactions have been eliminated. Spindle, Inc. and Spindle Mobile, Inc. will be collectively referred herein to as the “Company”. |
Organization_of_The_Company_an3
Organization of The Company and Significant Accounting Policies: Cash and Cash Equivalents Policy (Policies) | 12 Months Ended |
Dec. 31, 2014 | |
Policies | |
Cash and Cash Equivalents Policy | Cash and cash equivalents |
For purpose of the statements of cash flows, the Company considers cash and cash equivalents to include all stable, highly liquid investments with maturities of three months or less. |
Organization_of_The_Company_an4
Organization of The Company and Significant Accounting Policies: Concentration of Credit Risk Policy (Policies) | 12 Months Ended |
Dec. 31, 2014 | |
Policies | |
Concentration of Credit Risk Policy | Concentration of credit risk |
The Company primarily transacts its business with one financial institution. The amount on deposit in that one institution may from time to time exceed the federally-insured limit. |
Organization_of_The_Company_an5
Organization of The Company and Significant Accounting Policies: Use of Estimates Policy (Policies) | 12 Months Ended |
Dec. 31, 2014 | |
Policies | |
Use of Estimates Policy | Use of estimates |
The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. |
Organization_of_The_Company_an6
Organization of The Company and Significant Accounting Policies: Income Taxes Policy (Policies) | 12 Months Ended |
Dec. 31, 2014 | |
Policies | |
Income Taxes Policy | Income taxes |
The Company accounts for its income taxes under the provisions of ASC Topic 740, “Income Taxes.” The method of accounting for income taxes under ASC 740 is an asset and liability method. The asset and liability method requires the recognition of deferred tax liabilities and assets for the expected future tax consequences of temporary differences between tax bases and financial reporting bases of other assets and liabilities. |
Organization_of_The_Company_an7
Organization of The Company and Significant Accounting Policies: Revenue Recognition Policy (Policies) | 12 Months Ended |
Dec. 31, 2014 | |
Policies | |
Revenue Recognition Policy | Revenue recognition |
Revenue is derived on a per message/notification basis through the Company’s patented technologies and a modular, adaptable platform designed to create multi-channel messaging gateways for all types of connected devices. The Company also earns revenue for services, such as programming, licensure on SaaS basis, and on a performance basis, such as when a client acquires a new customer through our platform. Revenue is recognized in accordance with Staff Accounting Bulletin (“SAB”) No. 101, “Revenue Recognition in Financial Statements,” as revised by SAB No. 104. As such, the Company recognizes revenue when persuasive evidence of an arrangement exists, title transfer has occurred, the price is fixed or readily determinable, and collectability is probable. Sales are recorded net of sales discounts. |
Organization_of_The_Company_an8
Organization of The Company and Significant Accounting Policies: Restricted Cash Policy (Policies) | 12 Months Ended |
Dec. 31, 2014 | |
Policies | |
Restricted Cash Policy | Restricted cash |
The Company maintains a restricted cash balance as part of its operating requirements in a non-interest-bearing account that currently does not exceed federally insured limits totaling $20,000. |
Organization_of_The_Company_an9
Organization of The Company and Significant Accounting Policies: Accounts Receivable Policy (Policies) | 12 Months Ended |
Dec. 31, 2014 | |
Policies | |
Accounts Receivable Policy | Accounts receivable |
Accounts receivable is reported at the customers’ outstanding balances, less any allowance for doubtful accounts. Interest is not accrued on overdue accounts receivable. |
Recovered_Sheet1
Organization of The Company and Significant Accounting Policies: Allowance For Doubtful Accounts Policy (Policies) | 12 Months Ended |
Dec. 31, 2014 | |
Policies | |
Allowance For Doubtful Accounts Policy | Allowance for doubtful accounts |
An 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 information collected from individual customers. Accounts receivable are charged off against the allowance when collectability is determined to be permanently impaired. |
Recovered_Sheet2
Organization of The Company and Significant Accounting Policies: Inventory Policy (Policies) | 12 Months Ended |
Dec. 31, 2014 | |
Policies | |
Inventory Policy | Inventory |
Inventories consist of merchandise held for sale in the ordinary course of business, including cost of freight and other miscellaneous acquisition costs, and are stated at the lower of cost or market. The Company records a write-down for inventories, which have become obsolete or are in excess of anticipated demand or net realizable value. The Company performs a detailed review of inventory each period that considers multiple factors including demand forecasts, market conditions, product life cycle status, product development plans and current sales levels. If future demand or market conditions for the Company’s products are less favorable than forecasted or if unforeseen changes negatively affect the utility of the Company’s inventory, it may be required to record additional write-downs, which would negatively affect gross margins in the period when the write-downs are recorded. If actual market conditions are more favorable, the Company may have higher gross margins when products incorporating inventory that were previously written down are sold. |
Recovered_Sheet3
Organization of The Company and Significant Accounting Policies: Property and Equipment, Policy (Policies) | 12 Months Ended | |
Dec. 31, 2014 | ||
Policies | ||
Property and Equipment, Policy | Property and equipment | |
Property and equipment are stated at cost. Major renewals and improvements are charged to the asset accounts while replacements, maintenance and repairs that do not improve or extend the lives of the respective assets are expensed. At the time property and equipment are retired or otherwise disposed of, the asset and related accumulated depreciation accounts are relieved of the applicable amounts. Gains or losses from retirements or sales are credited or charged to income. | ||
Depreciation is computed on the straight-line and accelerated methods for financial reporting and income tax reporting purposes based upon the following estimated useful lives: | ||
Computer Software | 3 years | |
Computer Equipment | 5 years | |
Office furniture and equipment | 7 years | |
Recovered_Sheet4
Organization of The Company and Significant Accounting Policies: Long-lived Assets Policy (Policies) | 12 Months Ended |
Dec. 31, 2014 | |
Policies | |
Long-lived Assets Policy | Long-lived assets |
The Company accounts for its long-lived assets in accordance with ASC Topic 360-10-05, “Accounting for the Impairment or Disposal of Long-Lived Assets.” ASC Topic 360-10-05 requires that long-lived assets be reviewed for impairment whenever events or changes in circumstances indicate that the historical cost carrying value of an asset may no longer be appropriate. The Company assesses recoverability of the carrying value of an asset by estimating the future net cash flows expected to result from the asset, including eventual disposition. If the future net cash flows are less than the carrying value of the asset, an impairment loss is recorded equal to the difference between the asset’s carrying value and fair value or disposable value. The Company recorded an impairment to its intellectual property for the year ended December 31, 2014 as further discussed in Note 6. |
Recovered_Sheet5
Organization of The Company and Significant Accounting Policies: Goodwill Policy (Policies) | 12 Months Ended |
Dec. 31, 2014 | |
Policies | |
Goodwill Policy | Goodwill |
The Company accounts for goodwill in accordance with ASC Topic 805-30-25, “Accounting for Business Combinations” and ASC Topic 350-20-35, “Accounting for Goodwill - Subsequent Measurement”. | |
ASC Topic 805-30 requires that the acquirer shall recognize goodwill as of the acquisition date as the excess of the fair value of the consideration transferred over the fair value of the net acquisition-date amounts of the identifiable assets and liabilities assumed. | |
ASC Topic 350-20-35 requires that goodwill acquired in a purchase and determined to have an indefinite useful life is not amortized, but instead tested for impairment annually or more frequently when events or circumstances indicates that the carrying value of a reporting unit more likely than not exceeds its fair value. The Company’s annual goodwill impairment testing date is December 31 of each year. The Company first assesses qualitative factors to determine whether it’s necessary to perform the two-step goodwill impairment test. Impairment is the condition that exists when the carrying amount of goodwill exceeds its implied fair value. If the qualitative assessment results in an indication that it’s more likely than not that the fair value of a reporting unit is less than its carrying amount, then a quantitative assessment must be performed. Management has determined that the Company has one reporting unit for purposes of testing goodwill. | |
The quantitative analysis involves estimating the fair value of its reporting unit utilizing a combination of valuation methods including market capitalization, the income approach and cash flows. Income and cash flow forecasts were used in the evaluation of goodwill based on management’s estimate of future performance. If goodwill is determined to be impaired as a result of this analysis, an impairment loss is recorded equal to the difference between the asset’s carrying value and fair value. The Company recorded an impairment to its goodwill for the year ended December 31, 2014 as further discussed in Note 9. |
Recovered_Sheet6
Organization of The Company and Significant Accounting Policies: Capitalized Software Development Costs Policy (Policies) | 12 Months Ended |
Dec. 31, 2014 | |
Policies | |
Capitalized Software Development Costs Policy | Capitalized software development costs |
The Company capitalizes internal software development costs subsequent to establishing technological feasibility of a software application. Capitalized software development costs represent the costs associated with the internal development of the Company’s software applications. Amortization of such costs is recorded on a software application-by-application basis, based on the greater of the proportion of current year sales to total of current and estimated future sales for the applications or the straight-line method over the remaining estimated useful life of the software application. The Company continually evaluates the recoverability of capitalized software costs and will charge to operations amounts that are deemed unrecoverable for projects it abandons. |
Recovered_Sheet7
Organization of The Company and Significant Accounting Policies: Stock-based Compensation, Policy (Policies) | 12 Months Ended |
Dec. 31, 2014 | |
Policies | |
Stock-based Compensation, Policy | Stock-based compensation |
The Company accounts for stock-based payments to employees in accordance with ASC 718, “Stock Compensation” (“ASC 718”). Stock-based payments to employees include grants of stock, grants of stock options and issuance of warrants that are recognized in the consolidated statement of operations based on their fair values at the date of grant. | |
The Company accounts for stock-based payments to non-employees in accordance with ASC 505-50, “Equity-Based Payments to Non-Employees.” Stock-based payments to non-employees include grants of stock, grants of stock options and issuances of warrants that are recognized in the consolidated statement of operations based on the value of the vested portion of the award over the requisite service period as measured at its then-current fair value as of each financial reporting date. The Company calculates the fair value of option grants and warrant issuances utilizing the Binomial pricing model. The amount of stock-based compensation recognized during a period is based on the value of the portion of the awards that are ultimately expected to vest. ASC 718 requires forfeitures to be estimated at the time stock options are granted and warrants are issued to employees and non-employees, and revised, if necessary, in subsequent periods if actual forfeitures differ from those estimates. The term “forfeitures” is distinct from “cancellations” or “expirations” and represents only the unvested portion of the surrendered stock option or warrant. | |
The Company estimates forfeiture rates for all unvested awards when calculating the expense for the period. In estimating the forfeiture rate, the Company monitors both stock option and warrant exercises as well as employee termination patterns. The resulting stock-based compensation expense for both employee and non-employee awards is generally recognized on compensation under ASC Topic 505-50, In accordance with ASC 505-50, the cost of stock-based compensation is measured at the grant date based on the value of the award and is recognized over the vesting period. The value of the stock-based award is determined using the Binomial or Black-Scholes option-pricing models, whereby compensation cost is the excess of the fair value of the award as determined by the pricing model at the grant date or other measurement date over the amount that must be paid to acquire the stock. |
Recovered_Sheet8
Organization of The Company and Significant Accounting Policies: Loss Per Share Policy (Policies) | 12 Months Ended |
Dec. 31, 2014 | |
Policies | |
Loss Per Share Policy | Loss per share |
The Company reports earnings (loss) per share in accordance with ASC Topic 260-10, "Earnings per Share." Basic earnings (loss) per share is computed by dividing income (loss) available to common shareholders by the weighted average number of common shares available. Diluted earnings (loss) per share is computed similar to basic earnings (loss) per share except that the denominator is increased to include the number of additional common shares that would have been outstanding if the potential common shares had been issued and if the additional common shares were dilutive. Diluted earnings (loss) per share has not been presented since the effect of the assumed conversion of warrants and debt to purchase common shares would have an anti-dilutive effect. Potential common shares as of December 31, 2014 that have been excluded from the computation of diluted net loss per share amounted to 3,710,834 shares and include 250,000 warrants and 3,460,834 options. Of the 3,460,834 potential common shares at December 31, 2014, 1,342,500 had not vested. |
Recovered_Sheet9
Organization of The Company and Significant Accounting Policies: Fair Value of Financial Instruments Policy (Policies) | 12 Months Ended |
Dec. 31, 2014 | |
Policies | |
Fair Value of Financial Instruments Policy | Fair value of financial instruments |
Fair value estimates discussed herein are based upon certain market assumptions and pertinent information available to management as of December 31, 2014 and 2013. The respective carrying value of certain on-balance-sheet financial instruments approximated their fair values. Fair values were assumed to approximate carrying values for cash and payables because they are short term in nature and their carrying amounts approximate fair values or they are payable on demand. |
Recovered_Sheet10
Organization of The Company and Significant Accounting Policies: Year-end (Policies) | 12 Months Ended |
Dec. 31, 2014 | |
Policies | |
Year-end | Year-end |
The Company’s year-end is December 31. |
Recovered_Sheet11
Organization of The Company and Significant Accounting Policies: Recent Accounting Pronouncements (Policies) | 12 Months Ended |
Dec. 31, 2014 | |
Policies | |
Recent Accounting Pronouncements | Recent Accounting Pronouncements |
The Company continually assesses any new accounting pronouncements to determine their applicability to the Company. Where it is determined that a new accounting pronouncement affects the Company’s financial reporting, the Company undertakes a study to determine the consequence of the change to its financial statements and assures that there are proper controls in place to ascertain that the Company’s financials properly reflect the change. | |
In August 2014, The FASB issued ASU No. 2014-15, “Presentation of Financial Statements - Going Concern (Subtopic 205-40).” ASU 2014-15 provides guidance for disclosure of uncertainties about an entity’s ability to continue as a going concern. In doing so, management will need to perform an evaluation at each interim and annual reporting period to determine whether or not there are conditions or events, considered in the aggregate, that raise substantial doubt about the entity’s ability to continue as a going concern within one year after the date that the financial statements are issued. If these conditions exist, the entity should evaluate whether the doubt is mitigated by management’s plans or events and should make such required disclosures. This guidance will be effective for the Company for its interim reporting for the quarter ended March 31, 2017. |
Recovered_Sheet12
Organization of The Company and Significant Accounting Policies: Property and Equipment, Policy: Property and Equipment, Schedule of Useful Lives (Tables) | 12 Months Ended | |
Dec. 31, 2014 | ||
Tables/Schedules | ||
Property and Equipment, Schedule of Useful Lives | ||
Computer Software | 3 years | |
Computer Equipment | 5 years | |
Office furniture and equipment | 7 years |
Accounts_Receivable_Disclosure1
Accounts Receivable Disclosure: Schedule of Accounts Receivable (Tables) | 12 Months Ended | |||||
Dec. 31, 2014 | ||||||
Tables/Schedules | ||||||
Schedule of Accounts Receivable | ||||||
December 31, | December 31, | |||||
2014 | 2013 | |||||
Due from customers | $ | 93,643 | $ | 182,663 | ||
Less allowance for bad debts | -11,250 | -10,967 | ||||
Total accounts receivable, net | $ | 82,393 | $ | 171,696 |
Fixed_Assets_Disclosure_Schedu
Fixed Assets Disclosure: Schedule of Fixed Assets (Tables) | 12 Months Ended | |||||
Dec. 31, 2014 | ||||||
Tables/Schedules | ||||||
Schedule of Fixed Assets | ||||||
DECEMBER 31, | DECEMBER 31, | |||||
2014 | 2013 | |||||
Office furniture & equipment | $ | 32,895 | $ | 32,895 | ||
Less: accumulated depreciation | -10,750 | -5,525 | ||||
Total fixed assets, net | $ | 22,145 | $ | 27,370 |
Capitalized_Software_Costs_and1
Capitalized Software Costs and Intellectual Property: Schedule of Capitalized Software Costs (Tables) | 12 Months Ended | |||||
Dec. 31, 2014 | ||||||
Tables/Schedules | ||||||
Schedule of Capitalized Software Costs | ||||||
DECEMBER 31, | DECEMBER 31, | |||||
2014 | 2013 | |||||
Capitalized software costs | $ | 2,182,640 | $ | 1,440,278 | ||
Less: accumulated amortization | -582,017 | -199,646 | ||||
Net capitalized software costs | 1,600,623 | 1,240,632 | ||||
License agreements | 69,808 | 232,693 | ||||
Accumulated impairment loss | -69,808 | -- | ||||
Less: accumulated depreciation | -- | -116,347 | ||||
Net licenses | -- | 116,346 | ||||
Total intellectual property, net | $ | 1,600,623 | $ | 1,356,978 |
Domain_Names_Disclosure_Schedu
Domain Names Disclosure: Schedule of Domain Names (Tables) | 12 Months Ended | |||||
Dec. 31, 2014 | ||||||
Tables/Schedules | ||||||
Schedule of Domain Names | ||||||
DECEMBER 31, | DECEMBER 31, | |||||
2014 | 2013 | |||||
Domain names | $ | 85,000 | $ | 75,000 | ||
Less: accumulated amortization | -11,887 | -1,210 | ||||
Total domain names, net | $ | 73,113 | $ | 73,790 |
Residual_Contracts_Disclosure_
Residual Contracts Disclosure: Schedule of Acquired Finite-Lived Intangible Assets (Tables) | 12 Months Ended | |||||
Dec. 31, 2014 | ||||||
Tables/Schedules | ||||||
Schedule of Acquired Finite-Lived Intangible Assets | ||||||
DECEMBER 31, | DECEMBER 31, | |||||
2014 | 2013 | |||||
Residual contracts | $ | 589,294 | $ | 589,294 | ||
Less: accumulated amortization | -147,324 | -- | ||||
Total residual contracts, net | $ | 441,970 | $ | 589,294 |
Goodwill_Disclosure_Schedule_o
Goodwill Disclosure: Schedule of Goodwill (Tables) | 12 Months Ended | |||||
Dec. 31, 2014 | ||||||
Tables/Schedules | ||||||
Schedule of Goodwill | ||||||
DECEMBER 31, | DECEMBER 31, | |||||
2014 | 2013 | |||||
Goodwill | $ | 5,976,198 | $ | 2,679,970 | ||
Less: accumulated impairment loss | -669,993 | -- | ||||
Total goodwill, net | $ | 5,306,205 | $ | 2,679,970 |
Warrants_and_Options_Disclosur1
Warrants and Options Disclosure: Schedule of Share-based Payment Award, Stock Options, Valuation Assumptions (Tables) | 12 Months Ended | |||
Dec. 31, 2014 | ||||
Tables/Schedules | ||||
Schedule of Share-based Payment Award, Stock Options, Valuation Assumptions | ||||
2014 | 2013 | |||
Dividend yield | 0.00% | 0.00% | ||
Expected volatility | 76.71% to 86.26% | 63.64% to 72.80% | ||
Risk free interest rate | 1.49% to 1.78% | 0.77% to 1.66% | ||
Expected term, in years | 6 | 5.50 to 6.0 |
Warrants_and_Options_Disclosur2
Warrants and Options Disclosure: Schedule of Stock Warrants (Tables) | 12 Months Ended | |||||
Dec. 31, 2014 | ||||||
Tables/Schedules | ||||||
Schedule of Stock Warrants | ||||||
Number of Warrants | Weighted-Average | Weighted-Average | ||||
and Options | Exercise Price | Remaining | ||||
Contractual | ||||||
Life (in years) | ||||||
Outstanding at December 31, 2012 | 2,515,000 | $ | 0.549 | |||
Granted | 697,000 | - | ||||
Exercised | - | - | ||||
Forfeited/Cancelled | -236,000 | - | ||||
Outstanding at December 31, 2013 | 2,976,000 | $ | 0.549 | 7.86 | ||
Exercisable at December 31, 2014 | 1,999,550 | $ | 0.581 | 8.71 | ||
Outstanding at December 31, 2013 | 2,976,000 | $ | 0.549 | 7.86 | ||
Granted | 2,392,500 | - | ||||
Exercised | - | - | ||||
Forfeited/Cancelled | -1,657,666 | - | ||||
Outstanding at December 31, 2014 | 3,710,834 | $ | 0.534 | 7.09 | ||
Exercisable at December 31, 2014 | 2,368,334 | $ | 0.553 | 6.33 |
Business_Acquisitions_Note_Sch
Business Acquisitions, Note: Schedule of Business Acquisitions Consideration (Tables) | 12 Months Ended | |||
Dec. 31, 2014 | ||||
Tables/Schedules | ||||
Schedule of Business Acquisitions Consideration | ||||
Fair Value of | ||||
Consideration | ||||
Transferred | ||||
Cash paid to Yowza!!, net of cash acquired | $ | 500,000 | ||
Fair value of Company's shares issued | 3,004,860 | |||
Cash paid to extinguish debt, net of cash acquired | -13,632 | |||
$ | 3,491,228 |
Business_Acquisitions_Note_Sch1
Business Acquisitions, Note: Schedule of Purchase Price Allocation (Tables) | 12 Months Ended | |||
Dec. 31, 2014 | ||||
Tables/Schedules | ||||
Schedule of Purchase Price Allocation | ||||
Net assets acquired: | ||||
Cash | $ | 1,368 | ||
Accounts receivable | 2,928 | |||
Software development costs | 200,000 | |||
Trademarks | 10,000 | |||
Net liabilities assumed: | ||||
Accounts payable | -15,000 | |||
Goodwill | 3,291,932 | |||
Total purchase price | $ | 3,491,228 |
Recovered_Sheet13
Organization of The Company and Significant Accounting Policies: Property and Equipment, Policy: Property and Equipment, Schedule of Useful Lives (Details) | 12 Months Ended |
Dec. 31, 2014 | |
Software and Software Development Costs | |
Property, Plant and Equipment, Useful Life | 3 years |
Computer Equipment | |
Property, Plant and Equipment, Useful Life | 5 years |
Furniture and Fixtures | |
Property, Plant and Equipment, Useful Life | 7 years |
Recovered_Sheet14
Organization of The Company and Significant Accounting Policies: Loss Per Share Policy (Details) | 12 Months Ended |
Dec. 31, 2014 | |
Details | |
Common shares excluded from the computation of diluted net loss per share | 3,460,834 |
Going_Concern_Details
Going Concern (Details) (USD $) | 12 Months Ended | |
Dec. 31, 2014 | Dec. 31, 2013 | |
Details | ||
Net loss incurred | ($8,922,022) | ($3,713,782) |
Accumulated deficit at end of period | ($15,252,417) | ($6,330,395) |
Accounts_Receivable_Disclosure2
Accounts Receivable Disclosure: Schedule of Accounts Receivable (Details) (USD $) | Dec. 31, 2014 | Dec. 31, 2013 |
Details | ||
Due from customers | $93,643 | $182,663 |
Allowance for bad debts | -11,250 | -10,967 |
Accounts receivable, net | $82,393 | $171,696 |
Prepaid_Expenses_and_Deposits_1
Prepaid Expenses and Deposits, Note (Details) (USD $) | 12 Months Ended | 0 Months Ended | 11 Months Ended | 12 Months Ended | ||
Dec. 31, 2013 | Dec. 31, 2012 | Jan. 23, 2013 | Dec. 31, 2013 | Dec. 31, 2014 | Feb. 07, 2012 | |
Deposits | $12,342 | 12,342 | $3,382 | $5,000 | ||
Legal expenses | 623,423 | |||||
Marketing Agreement | ||||||
Common stock issued for services | 350,000 | |||||
Value of common stock issued for services | 175,000 | |||||
Consulting expense recognized | 122,500 | |||||
Consulting Agreement | ||||||
Common stock issued for services | 500,000 | 340,000 | ||||
Value of common stock issued for services | 420,000 | 1,109,500 | ||||
Consulting expense recognized | 1,075,438 | |||||
Remaining prepaid balance | $37,042 |
Fixed_Assets_Disclosure_Schedu1
Fixed Assets Disclosure: Schedule of Fixed Assets (Details) (USD $) | Dec. 31, 2014 | Dec. 31, 2013 |
Details | ||
Office furniture & equipment | $32,895 | $32,895 |
Less, accumulated depreciation | -10,750 | -5,525 |
Total fixed assets, net | $22,145 | $27,370 |
Capitalized_Software_Costs_and2
Capitalized Software Costs and Intellectual Property: Schedule of Capitalized Software Costs (Details) (USD $) | Dec. 31, 2014 | Dec. 31, 2013 |
Details | ||
Capitalized software costs | $2,182,640 | $1,440,278 |
(Less) Accumulated amortization (software) | 582,017 | 199,646 |
Total capitalized software costs | 1,600,623 | 1,240,632 |
License agreements | 69,808 | 232,693 |
Accumulated impairment loss | -69,808 | |
(Less) Accumulated depreciation (licenses) | -116,347 | |
Total licenses | 116,346 | |
Total intellectual property, net | $1,600,623 | $1,356,978 |
Domain_Names_Disclosure_Schedu1
Domain Names Disclosure: Schedule of Domain Names (Details) (USD $) | Dec. 31, 2014 | Dec. 31, 2013 |
Details | ||
Domain Names, gross | $85,000 | $75,000 |
(Less) Accumulated depreciation (Domain Names) | -11,887 | -1,210 |
Total Domain Names, net | $73,113 | $73,790 |
Residual_Contracts_Disclosure_1
Residual Contracts Disclosure (Details) (USD $) | 12 Months Ended |
Dec. 31, 2014 | |
Details | |
Fair value of residual contracts acquired | $589,294 |
Residual_Contracts_Disclosure_2
Residual Contracts Disclosure: Schedule of Acquired Finite-Lived Intangible Assets (Details) (USD $) | Dec. 31, 2014 | Dec. 31, 2013 |
Details | ||
Residual contracts, gross | $589,294 | $589,294 |
Accumulated amortization of residual contracts | 147,324 | |
Total residual contracts, net | $441,970 | $589,294 |
Goodwill_Disclosure_Schedule_o1
Goodwill Disclosure: Schedule of Goodwill (Details) (USD $) | Dec. 31, 2014 | Dec. 31, 2013 |
Details | ||
Goodwill, gross | $5,976,198 | $2,679,970 |
(Less) accumulated impairment loss on goodwill | 669,993 | |
Goodwill, net | $5,306,205 | $2,679,970 |
Notes_Payable_Related_Party_Di1
Notes Payable - Related Party, Disclosure (Details) (USD $) | 12 Months Ended | |
Dec. 31, 2014 | Dec. 31, 2013 | |
Promissory Grid Note | ||
Debt discount attributed to note | $28,349 | |
Note repaid | 55,000 | |
Interest repaid | 1,994 | 17,336 |
Director of the Company | ||
Debt discount attributed to note | 110 | |
Note payable recorded | $100,000 |
Stockholders_Equity_Disclosure1
Stockholders' Equity Disclosure (Details) (USD $) | 12 Months Ended | |
Dec. 31, 2014 | Dec. 31, 2013 | |
Common stock authorized to be issued | 300,000,000 | 300,000,000 |
Par value of common stock | 0.001 | $0.00 |
Services rendered and unissued 2012 | ||
Common stock issued | 550,000 | |
Stock Issued for MeNetwork Agreement | ||
Common stock issued | 750,000 | |
Stock issued for cash | ||
Common stock issued | 2,890,000 | 6,331,250 |
Value or proceeds received for stock issuance | $3,165,625 | |
Common stock unissued (payable) | 100,000 | |
Stock to be issued for Cash | ||
Common stock issued | 3,890,000 | 466,250 |
Value or proceeds received for stock issuance | 1,945,000 | |
Stock issued for consulting agreement | ||
Common stock issued | 840,000 | |
Value or proceeds received for stock issuance | 420,000 | |
Stock Issued for accrued legal fees | ||
Common stock issued | 898,952 | |
Value or proceeds received for stock issuance | 449,476 | |
Stock to be Issued for Asset Acquisition | ||
Common stock issued | 1,642,000 | 3,500,000 |
Value or proceeds received for stock issuance | 3,004,861 | 3,132,500 |
Stock Issued for Asset Acquisition | ||
Common stock issued | 1,445,000 | 750,000 |
Settlement of litigation | ||
Common stock issued | 1,424,075 | |
Value or proceeds received for stock issuance | 712,038 | |
Stock to be issued, CEO compensation and bonus | ||
Common stock issued | 338,000 | 121,000 |
Value or proceeds received for stock issuance | 680,700 | |
Stock issued for services | ||
Common stock issued | 1,253,353 | |
Value or proceeds received for stock issuance | 2,108,945 | |
Common stock unissued (payable) | 7,853 | |
Common stock cancelled | 50,000 | |
Stock issued for Accrued Legal Fees | ||
Common stock issued | 602,958 | |
Value or proceeds received for stock issuance | 816,524 | |
Stock to be issued, CFO compensation | ||
Common stock issued | 20,000 | |
Value or proceeds received for stock issuance | 29,000 | |
Stock to be issued, Employee compensation | ||
Common stock issued | 155,000 | |
Value or proceeds received for stock issuance | 153,550 |
Warrants_and_Options_Disclosur3
Warrants and Options Disclosure (Details) | Dec. 31, 2014 |
Details | |
Authorized amount of common stock under 2012 Stock Option Plan | 6,000,000 |
Warrants_and_Options_Disclosur4
Warrants and Options Disclosure: Schedule of Stock Warrants (Details) (USD $) | 12 Months Ended | ||
Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 | |
Details | |||
Number of warrants and options outstanding | 3,710,834 | 2,976,000 | 2,515,000 |
Weighted average exercise price (outstanding) | $0.53 | $0.55 | $0.55 |
Number of warrants and options granted in period | 2,392,500 | 697,000 | |
Number of warrants and options exercisable | 2,368,334 | 1,999,550 | |
Weighted average exercise price (exercisable) | $0.55 | $0.58 |
Business_Acquisitions_Note_Det
Business Acquisitions, Note (Details) | Dec. 31, 2012 | Oct. 07, 2013 | Mar. 20, 2013 |
Parallel | |||
Authorized issuance of common stock | 538,570 | ||
Parallel Indemnification Escrow | |||
Amount of shares to be issued held in escrow | 53,857 | ||
Parallel Deferred Consent Escrow | |||
Amount of shares to be issued held in escrow | 100,000 | ||
MeNetwork | |||
Authorized issuance of common stock | 750,000 | 2,750,000 | |
Amount of shares to be issued held in escrow | 350,000 |
Business_Acquisitions_Note_Sch2
Business Acquisitions, Note: Schedule of Business Acquisitions Consideration (Details) (Yowza, USD $) | Jan. 03, 2014 |
Yowza | |
Cash paid for acquisition | $500,000 |
Fair value of Company's shares issued | 3,004,860 |
Cash paid to extinguish debt | -13,632 |
Total purchase price | $3,491,228 |