Document_and_Entity_Informatio
Document and Entity Information | 3 Months Ended | |
Jun. 30, 2013 | Aug. 14, 2013 | |
Document and Entity Information: | ' | ' |
Entity Registrant Name | 'LAS VEGAS RAILWAY EXPRESS, INC. | ' |
Document Type | '10-Q | ' |
Document Period End Date | 30-Jun-13 | ' |
Amendment Flag | 'false | ' |
Entity Central Index Key | '0001405227 | ' |
Current Fiscal Year End Date | '--03-31 | ' |
Entity Common Stock, Shares Outstanding | ' | 166,066,106 |
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 | 'Q1 | ' |
CONDENSED_BALANCE_SHEETS
CONDENSED BALANCE SHEETS (USD $) | 3 Months Ended | |
Jun. 30, 2013 | Mar. 31, 2013 | |
ASSETS: | ' | ' |
Cash | $970,303 | $1,262,615 |
Other current assets | 767,601 | 471,772 |
Total current assets | 1,737,904 | 1,734,387 |
Property and equipment, net of accumulated depreciation | 499,920 | 393,789 |
Deposit with Union Pacific | 600,000 | 600,000 |
Other assets | -3,349 | ' |
Goodwill | 843,697 | 843,697 |
Total other assets | 1,473,004 | 1,469,655 |
Total assets | 3,710,828 | 3,597,831 |
Liabilities and Stockholders' Deficit | ' | ' |
Short term notes payable | 13,333 | 13,333 |
Accounts payable and accrued expenses | 478,687 | 375,295 |
Derivative liability | 5,801,826 | 3,181,537 |
Convertible notes payable, net of discount | 750,401 | 116,042 |
Liabilities of discontinued operations | 85,041 | 194,041 |
Total current liabilities | 7,129,288 | 3,880,248 |
Deferred tax liability | 60,405 | 55,914 |
TOTAL LIABILITIES | 7,189,693 | 3,936,162 |
Commitments and contingencies | ' | ' |
Stockholders' deficit | ' | ' |
Common stock, $0.0001 par value, 200,000,000 shares authorized, 162,316,106 and 154,111,882 shares issued and outstanding as of June 30, 2013 (unaudited) and March 31, 2013, respectively | 16,232 | 15,411 |
Additional paid-in capital | 18,297,073 | 18,221,881 |
Accumulated deficit | -21,792,170 | -18,575,623 |
Total stockholders' deficit | -3,478,865 | -338,331 |
Total stockholders' deficit Total liabilities and stockholders' deficit | $3,710,828 | $3,597,831 |
BALANCE_SHEET_PARENTHETICAL
BALANCE SHEET PARENTHETICAL (USD $) | Jun. 30, 2013 | Mar. 31, 2013 |
CONDENSED BALANCE SHEETS | ' | ' |
Common stock par value | $0.00 | $0.00 |
Common stock shares authorized | 200,000,000 | 200,000,000 |
Common stock shares issued | 162,316,106 | 154,111,882 |
Common stock shares outstanding | 162,316,106 | 154,111,882 |
CONDENSED_STATEMENT_OF_OPERATI
CONDENSED STATEMENT OF OPERATIONS (USD $) | 3 Months Ended | |
Jun. 30, 2013 | Jun. 30, 2012 | |
Operating Expenses: | ' | ' |
Compensation and payroll taxes | $849,329 | $564,842 |
Selling, general and administrative | 208,123 | 89,738 |
Professional fees | 581,788 | 121,865 |
Depreciation expense | 1,434 | 160 |
Total expenses | 1,640,674 | 776,605 |
Loss from operations | -1,640,674 | -776,605 |
Other (expense) income | ' | ' |
Interest expense | -2,521,627 | -13,770 |
Change in derivative liability | 950,245 | 22,440 |
Total other (expense) income | -1,571,382 | 8,670 |
Net loss from continuing operations before provision for income taxes | -3,212,056 | -767,935 |
Provision for income taxes | -4,491 | -4,491 |
Net loss from continuing operations | -3,216,547 | -772,426 |
Income from discontinued operations, net of income taxes | 0 | 484,420 |
Net loss | ($3,216,547) | ($288,006) |
Net loss per share, continuing operations, basic and diluted | ($0.02) | ($0.01) |
Net income per share, discontinued operations, basic and diluted | ' | $0.01 |
Net loss per share, basic and diluted | ($0.02) | $0 |
Weighted average number of common shares outstanding, basic and diluted | 160,066,779 | 61,535,442 |
CONDENSED_STATEMENT_OF_CASH_FL
CONDENSED STATEMENT OF CASH FLOWS (USD $) | 3 Months Ended | |
Jun. 30, 2013 | Jun. 30, 2012 | |
Cash flows from operating activities | ' | ' |
Net loss | ($3,216,547) | ($288,006) |
Depreciation and amortization | 1,434 | 160 |
Amortization of discounts on note payable | 2,305,550 | 3,628 |
Amortization of debt offering costs | 155,391 | ' |
Deferred tax provision | 4,491 | 4,491 |
Change in value of derivative liability | -950,245 | -22,440 |
Stock issued and subscribed for services | 400,905 | 394,227 |
Stock option compensation | ' | 20,131 |
Warrants issued for services | 221,789 | ' |
Other current assets | 20,531 | 15,500 |
Other assets | -3,349 | ' |
Liabilities of discontinued operations, net | -109,000 | -89,392 |
Accounts payable and accrued expenses | 104,303 | 3,021 |
Net cash used in operating activities | -1,064,747 | -443,100 |
Cash flows from investing activities | ' | ' |
Purchases of property and equipment | -107,565 | -14,596 |
Net cash used in investing activities | -107,565 | -14,596 |
Cash flows from financing activities | ' | ' |
Proceeds from sale of stock | ' | 1,190,000 |
Proceeds from convertible notes payable | 880,000 | ' |
Payments on note payable | ' | -25,000 |
Net cash provided by financing activities | 880,000 | 1,165,000 |
Net change in cash | -292,312 | 707,304 |
Cash, beginning of the period | 1,262,615 | 53,632 |
Cash, end of the period | 970,303 | 760,936 |
Interest paid | ' | 1,944 |
Income taxes paid | ' | ' |
Stock issued for debt | 270,911 | 559,200 |
Stock issued for reduction of liabilities from discontinued operations | ' | $156,239 |
1_Organization_and_Basis_of_Pr
(1) Organization and Basis of Presentation | 3 Months Ended | |||||||||
Jun. 30, 2013 | ||||||||||
Notes | ' | |||||||||
(1) Organization and Basis of Presentation | ' | |||||||||
(1) Organization and basis of presentation | ||||||||||
Basis of Financial Statement Presentation: | ||||||||||
The accompanying unaudited interim financial statements of Las Vegas Railway Express, Inc. (the "Company") have been prepared in accordance with the instructions to Form 10-Q and Article 8 of Regulation S-X. Accordingly, they do not include all information and footnotes required by accounting principles generally accepted in the United States of America (“GAAP”) for complete financial statements. These statements reflect all normal and recurring adjustments which, in the opinion of management, are necessary to present fairly the financial position, results of operations and cash flows of the Company for the interim periods presented. However, the results of operations for the interim periods presented are not necessarily indicative of the results that may be expected for the year ending March 31, 2014 or any other future period. These interim financial statements should be read in conjunction with the audited consolidated financial statements and notes thereto included in the Company’s Annual Report on Form 10-K for the year ended March 31, 2013. | ||||||||||
Going Concern: | ||||||||||
The accompanying financial statements have been prepared assuming that the Company will continue as a going concern. As shown in the accompanying financial statements, the Company had no revenue, a net loss of $3,216,547 for the three months ended June 30, 2013 and an accumulated deficit of $21,792,170 through June 30, 2013, as well as outstanding convertible notes payable of $2,405,000 which are payable on February 1, 2014. Management believes that it will need additional equity or debt financing to implement the business plan. These matters raise substantial doubt about the Company’s ability to continue as a going concern. | ||||||||||
The Company estimates that it will need to obtain $10 million in additional capital to begin operations of its planned train service. The Company intends to raise these funds through the public or private sale of equity and/or debt securities. There is no assurance such funding will be available on terms acceptable to the Company, or at all. If the Company succeeds in raising such funds, it intends to use them for railcar purchase, design, refurbishment and outfitting for the National Routes beginning October 2013. The North Las Vegas depot design and construction, lease payments on the North Las Vegas depot site, Union Pacific Railroad (“UP”)capital infrastructure improvements of approximately $56 million and the procurement of 24 railcars designed specifically for the Las Vegas route are planned to be paid for through a Railroad Rehabilitation & Improvement Financing (“RRIF”) loan from FRA. The Company estimates that the operating capital generated from the National Routes would fund the operating costs of the deployment of the Las Vegas route. The RRIF loan will pay for the infrastructure improvements required on that route. | ||||||||||
The accompanying financial statements do not include any adjustments related to the recoverability and classification of assets and classification of liabilities that might be necessary should the Company be unable to continue as a going concern. | ||||||||||
Restatements: | ||||||||||
The accompanying condensed financial statements for the three months ended June 30, 2012 have been restated to reflect a correction relating to certain warrants and notes payable outstanding which contained elements that qualified them as derivative liabilities. Accordingly, the Company obtained a third party valuation of the warrants and embedded derivatives and reclassified them as derivative liabilities. As a result, the Company recorded the change in the fair value of the derivative liabilities as a component of the condensed statement of operations. The Company also made corrections to stock-based compensation, as well as its deferred income tax provision. | ||||||||||
The impact of the restatements described above is as follows. | ||||||||||
For the three months ended June 30, 2012: | ||||||||||
As Previously | ||||||||||
Reported | Adjustments | Restated | ||||||||
Operating Expenses: | ||||||||||
Compensation and payroll taxes | $ | 326,115 | $ | 238,727 | $ | 564,842 | ||||
Selling, general and administrative | 89,738 | - | 89,738 | |||||||
Professional fees | 148,365 | (26,500) | 121,865 | |||||||
Depreciation expense | 160 | - | -160 | |||||||
Total expenses | 564,378 | 212,227 | 776,605 | |||||||
Loss from operations | (564,378) | (212,227) | (776,605) | |||||||
Interest expense | (10,553) | (3,217) | (13,770) | |||||||
Change in derivative liability | - | 22,440 | 22,440 | |||||||
Total other income (expense) | (10,553) | 19,223 | 8,670 | |||||||
Net loss from continuing operations before tax provision | (574,931) | (193,004) | (767,935) | |||||||
Provision for income taxes | - | (4,491) | (4,491) | |||||||
Net loss from continuing operations | (574,931) | (197,495) | (772,426) | |||||||
Discontinued operations: | ||||||||||
Income from discontinued operations, net of income tax | 484,420 | 484,420 | ||||||||
Net loss | $ | (90,511) | $ | (197,495) | $ | (288,006) | ||||
2_Summary_of_Significant_Accou
(2) Summary of Significant Accounting Policies | 3 Months Ended |
Jun. 30, 2013 | |
Notes | ' |
(2) Summary of Significant Accounting Policies | ' |
(2) Summary of Significant Accounting Policies | |
Risks and Uncertainties: | |
The Company operates in an industry that is subject to intense competition and potential government regulations. Significant changes in regulations and the inability of the Company to establish contracts with rail services providers could have a materially adverse impact on the Company’s operations. | |
Use of Estimates: | |
The preparation of financial statements in conformity with GAAP 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 reported periods. | |
Property and Equipment: | |
Property and equipment are recorded at historical cost and depreciated on a straight-line basis over their estimated useful lives of approximately five years once the individual assets are placed in service. The Company expenses all purchases of equipment with individual costs of under $500. | |
Intangible Assets: | |
Goodwill represents the excess of purchase price over tangible and intangible assets acquired, less liabilities assumed arising from the acquisition of the train business on November 23, 2009. Goodwill is not amortized, but is reviewed for potential impairment on an annual basis at the reporting unit level. As required by the “Intangibles – Goodwill and Other” topic of Financial Accounting Standards Board Accounting Standards Codification (“FASB ASC”), the Company conducted an analysis of the goodwill on its single reporting unit using the Company’s market capitalization (based on Level 1 inputs). For the three months ended June 30, 2013, the assessment for impairment found that there is no impairment of goodwill. The Company has no accumulated impairment losses on goodwill. | |
Deposit with Union Pacific: | |
On November 8, 2012, the Company signed an agreement with Union Pacific Railroad Company whereby the Company was granted a nonexclusive operating right to use Union Pacific railroad track between Daggett, California and Las Vegas, Nevada. In connection with this agreement, the Company made an earnest money deposit of $600,000 and is required to meet certain financial conditions, including the provision of a letter of credit in favor of Union Pacific in the amount of $27,444,145 on or before October 31, 2013. Failure to meet the conditions specified in the agreement will result in the Company losing the $600,000 deposit. | |
Income Taxes: | |
Deferred tax assets and liabilities are recognized for the expected future tax consequences of events that have been included in the financial statements or tax returns. Under this method, deferred tax assets and liabilities are determined based on the differences between the financial reporting and tax bases of assets and liabilities using enacted tax rates in effect for the year in which the differences are expected to reverse. The deferred tax assets of the Company relate primarily to operating loss carryforwards for federal income tax purposes. A full valuation allowance for deferred tax assets has been provided because the Company believes it is not more likely than not that the deferred tax asset will be realized. Realization of deferred tax assets is dependent on the Company generating sufficient taxable income in future periods. | |
The Company’s goodwill is deductible for tax but not for book. This difference creates a deferred tax liability, which cannot be matched with the Company’s deferred tax asset. As a result, the Company cannot net it with its net operating loss carryforward and therefore records a deferred tax liability to reflect the future non-deductibility of its goodwill asset. The deferred tax liability at June 30, 2013 (unaudited) and March 31, 2013 was $60,405 and $55,914,,respectively. | |
The Company periodically evaluates its tax positions to determine whether it is more likely than not that such positions would be sustained upon examination by a tax authority for all open tax years, as defined by the statute of limitations, based on their technical merits. As of June 30, 2013 and March 31, 2013, the Company has not established a liability for uncertain tax positions. | |
Basic and Diluted Loss Per Share: | |
In accordance with FASB ASC 260, “Earnings Per Share,” the basic loss per common share is computed by dividing the net loss available to common stockholders after preferred stock dividends, by the weighted average common shares outstanding during the period. Diluted earnings per share reflect per share amounts that would have resulted if diluted potential common stock had been converted to common stock. Common stock equivalents have not been included in the earnings per share computation for the three months ended June 30, 2013 and 2012 as the amounts are anti-dilutive. As of June 30, 2013, the Company had 2,000,000 outstanding options which were excluded from the computation of net income per share because they are anti-dilutive. As of June 30, 2013, the Company also had convertible debt of $2,405,000 that is convertible into 48,100,000 shares of common stock which was excluded from the computation. As of June 30, 2013, the Company had 82,449,842 outstanding warrants which were also excluded from the computation because they were anti-dilutive. | |
Share Based Payment: | |
The Company issues stock, options and warrants as share-based compensation to employees and non-employees. | |
The Company accounts for its share-based compensation to employees in accordance FASB ASC 718. Stock-based compensation cost is measured at the grant date, based on the estimated fair value of the award, and is recognized as expense over the requisite service period. | |
The Company accounts for share-based compensation issued to non-employees and consultants in accordance with the provisions of FASB ASC 505-50 “Equity - Based Payments to Non-Employees.” Measurement of share-based payment transactions with non-employees is based on the fair value of whichever is more reliably measurable: (a) the goods or services received; or (b) the equity instruments issued. The final fair value of the share-based payment transaction is determined at the performance completion date. For interim periods, the fair value is estimated and the percentage of completion is applied to that estimate to determine the cumulative expense recorded. | |
The Company values stock compensation based on the market price on the measurement date. As described above, for employees this is the date of grant, and for non-employees, this is the date of performance completion. | |
The Company values stock options and warrants that do not qualify as derivative instruments using the Black-Scholes option pricing model. There were no options or warrants granted during the three months ended June 30, 2013 or 2012 that were valued used in the Black-Scholes model. | |
Certain warrants qualify as derivative instruments and are valued using the binomial lattice method. See discussion below regarding accounting for derivative liabilities. | |
Derivative Liabilities: | |
In connection with the private placement of Convertible Notes beginning in February 2013, the Company became contingently obligated to issue shares of common stock in excess of the 200 million authorized under the Company’s certificate of incorporation. Consequently, the ability to settle these obligations with shares would be unavailable causing these obligations to potentially be settled in cash. This condition creates a derivative liability. | |
The Company has a sequencing policy regarding share settlement wherein instruments with the earliest issuance date would be settled first. The sequencing policy also considers contingently issuable additional shares, such as those issuable upon a stock split, to have an issuance date to coincide with the event giving rise to the additional shares. | |
Using this sequencing policy, all instruments convertible into common stock, including warrants and the conversion feature of notes payable, issued on and subsequent to February 13, 2013 are derivative liabilities. | |
The Company also has certain warrants and notes payable with elements that qualify as derivatives. The warrants have anti-dilution clauses that prevent calculation of the ultimate number of shares that may be issued upon exercise, and two of the notes payable had a variable conversion feature that similarly prevented the calculation of the number of shares into which they were convertible. | |
The Company values these warrants and notes payable using the binomial lattice method. The resulting liability is valued at each reporting date and the change in the liability is reflected as change in derivative liability in the statement of operations. | |
Fair Value of Financial Instruments: | |
The Company's financial instruments as defined by FASB ASC 825-10-50 include cash, notes payable and derivative liabilities. Derivative liabilities are recorded at fair value. The principal balance of notes payable approximates fair value because current interest rates and terms offered to the Company for similar debt are substantially the same. | |
FASB ASC 820 defines fair value, establishes a framework for measuring fair value, in accordance with generally accepted accounting principles, and expands disclosures about fair value measurements. FASB ASC 820 establishes a three-tier fair value hierarchy which prioritizes the inputs used in measuring fair value as follows: | |
Level 1. Observable inputs such as quoted prices in active markets; | |
Level 2. Inputs, other than the quoted prices in active markets, that are observable either directly or indirectly; and | |
Level 3. Unobservable inputs in which there is little or no market data, which requires the reporting entity to develop its own assumptions. | |
In the absence of such information or if the Company is not able to corroborate these prices by other available relevant market information, the fair values are estimated using internal calculations or discounted cash flow techniques that incorporate prepayment rates, discount rates and delinquency and default and cumulative loss expectations, that are implied by market prices for similar securities and collateral structure types. Because this valuation technique relies on significant unobservable inputs, the fair value estimation is classified as Level 3. The process for determining fair value using unobservable inputs is generally more subjective and involves a high degree of management judgment and assumptions. These assumptions may have a significant effect on the estimates of fair value, and the use of different assumptions as well as changes in market conditions could have a material effect on the results of operations or financial condition. | |
New Accounting Pronouncements: | |
There are no recent accounting pronouncements that management believes will have a material impact on the Company's present or future consolidated financial statements | |
3_Property_and_Equipment
(3) Property and Equipment | 3 Months Ended | |||||
Jun. 30, 2013 | ||||||
Notes | ' | |||||
(3) Property and Equipment | ' | |||||
(3) Property and Equipment | ||||||
Property and equipment consisted of the following. | ||||||
June 30, | March 31, | |||||
2013 | 2013 | |||||
(Unaudited) | ||||||
Office equipment | $ | 51,458 | $ | 40,921 | ||
Software | 30,167 | 14,192 | ||||
Transportation equipment under construction | 435,610 | 354,557 | ||||
517,235 | 409,670 | |||||
Less: accumulated depreciation | (17,315) | (15,881) | ||||
$ | 499,920 | $ | 393,789 | |||
4_Notes_Payable
(4) Notes Payable | 3 Months Ended | |||||||
Jun. 30, 2013 | ||||||||
Notes | ' | |||||||
(4) Notes Payable | ' | |||||||
(4) Notes payable | ||||||||
A summary of outstanding notes payable is as follows: | ||||||||
June 30, | March 31, | |||||||
2013 | 2013 | |||||||
(Unaudited) | ||||||||
Secured promissory notes, dated May 17, 2011 through | ||||||||
May 17, 2012 to an investor bearing interest at 8% per annum, | ||||||||
payable on May 17, 2012. The Company is in default on this note. | 13,333 | 13,333 | ||||||
Total outstanding notes payable | $ | 13,333 | $ | 13,333 | ||||
As of June 30, 2013, the Company is in default on the above note payable for $13,333. As of June 30, 2013, there has been no demand made for repayment of the notes or accrued interest. |
5_Convertible_Notes_Payable
(5) Convertible Notes Payable | 3 Months Ended | ||||||
Jun. 30, 2013 | |||||||
Notes | ' | ||||||
(5) Convertible Notes Payable | ' | ||||||
(5) Convertible Notes Payable | |||||||
During February and March 2013, the Company issued a series of convertible notes payable (the “Convertible Notes”) to investors for total proceeds of $1,900,000. The Convertible Notes are convertible into shares of the Company’s common stock at $0.05 per share at the option of the debt holder. The Convertible Notes bear interest at a rate of 8% per annum, and have a maturity date of February 1, 2014. Prior to March 31, 2013, the debt holders converted $105,000 of outstanding principal into 2,100,000 shares of common stock. As a result, as of March 31, 2013, the remaining gross principal balance of convertible notes payable outstanding amounted to $1,795,000. | |||||||
During the three months ended June 30, 2013, the Company issued additional Convertible Notes to investors for additional proceeds of $880,000, with the same terms as described above. During the three months ended June 30, 2013, the debt holders converted $270,000 of outstanding principal and $911 of accrued interest into 5,417,756 shares of common stock pursuant to the original terms in the agreements. As of June 30, 2013, the remaining principal balance of convertible notes payable amounted to $2,405,000, including $50,000 outstanding to a Director of the Company. | |||||||
The Company does not have sufficient authorized shares to cover the conversion feature of the convertible notes. The conversion feature of the Convertible Notes issued on and after February 13, 2013 created a derivative liability for the Company. See Note 6, Derivative Instruments. The beneficial conversion feature of the notes issued prior to February 13, 2013 was recorded as a discount to the notes based on its intrinsic value. | |||||||
In connection with the Convertible Notes, the Company granted an aggregate of 53,600,000 (including 17,600,000 during the three months ended June 30, 2013) warrants to purchase additional shares of common stock at an exercise price of $0.10 per share and a contractual life of 3 years. Of the 17,600,000 warrants granted during the three months ended June 30, 2013, 1,000,000 were granted to a Director of the Company. The Company does not have sufficient authorized shares to cover the warrants. As a result, the warrants issued during the three months ended June 30, 2013 were determined to be derivative liabilities which resulted in additional derivative liabilities of $1,372,237. See Note 8, Derivative Instruments. | |||||||
The value of the derivative liabilities and discounts created through the issuance of the Convertible Notes and warrants during the three months ended June 30, 2013 as described above exceeded the proceeds of the Convertible Notes by $1,401,191. This excess was recorded as interest expense on the issuance dates of each note and warrant during the three months ended June 30, 2013. | |||||||
The following summarizes the book value of the convertible notes payable outstanding as of June 30, 2013 and March 31, 2013. | |||||||
June 30, | March 31, | ||||||
2013 | 2013 | ||||||
(Unaudited) | |||||||
Principal balance of convertible notes payable outstanding | $ | 2,405,000 | $ | 1,795,000 | |||
Less: discount on convertible notes payable | (1,654,599) | (1,678,958) | |||||
Convertible notes payable, net | $ | 750,401 | $ | 116,042 | |||
. | |||||||
Future scheduled maturities of these notes payable are as follows: | |||||||
Year Ended | |||||||
March 31, | |||||||
2014 | $ | 2,405,000 | |||||
Total | $ | 2,405,000 | |||||
In connection with the Convertible Notes, the Company incurred debt issuance costs, which primarily represented commissions paid to acquire the debt. These costs have been capitalized and are being amortized through the maturity date of the notes. During the three months ended June 30, 2013, the Company capitalized an additional $521,351 of debt issuance costs, including the fair value of 4,760,000 warrants issued on April 29, 2013 as commission. Amortization of these capitalized debt issuance costs amounted to $155,391 for the three months ended June 30, 2013, which is reflected as interest expense on the accompanying statement of operations. As of June 30, 2013 and March 31, 2013, the remaining amount of capitalized debt issuance costs amounted to $497,760 and $116,329, respectively, which are included as a component of other current assets on the accompanying consolidated balance sheets. |
6_Derivative_Instruments
(6) Derivative Instruments | 3 Months Ended | ||||||||||||
Jun. 30, 2013 | |||||||||||||
Notes | ' | ||||||||||||
(6) Derivative Instruments | ' | ||||||||||||
(6) Derivative Instruments | |||||||||||||
Excess Shares | |||||||||||||
In connection with the private placement of Convertible Notes beginning in February 2013 (see Note 5), the Company became contingently obligated to issue shares of common stock in excess of the 200 million shares authorized under the Company’s certificate of incorporation. Consequently, the ability to settle these obligations with shares would be unavailable causing these obligations to potentially be settled in cash. This condition creates a derivative liability. | |||||||||||||
The Company has a sequencing policy regarding share settlement wherein instruments with the earliest issuance date would be settled first. The sequencing policy also considers contingently issuable additional shares, such as those issuable upon a stock split or anti-dilution, to have an issuance date to coincide with the event giving rise to the additional shares. | |||||||||||||
Using this sequencing policy, all instruments convertible into common stock, including warrants and the conversion feature of notes payable, issued on and subsequent to February 13, 2013 are classified as derivative liabilities. | |||||||||||||
Other Derivatives | |||||||||||||
The Company has certain warrants and notes payable with elements that qualify as derivatives. The warrants have anti-dilution clauses that prevent calculation of the ultimate number of shares that may be issued upon exercise, and two of the notes payable had a variable conversion feature that similarly prevented the calculation of the number of shares into which they were convertible. | |||||||||||||
The derivative liability, as it relates to the different instruments, is shown in the following table. | |||||||||||||
Three Months Ended June 30, 2013 | Three Months Ended June 30, 2012 | ||||||||||||
Conversion Feature | Conversion Feature | ||||||||||||
of | of | ||||||||||||
Warrants | Notes Payable | Total | Warrants | Notes Payable | Total | ||||||||
Beginning balance, April 1 | $ | 1,663,394 | $ | 1,518,143 | $ | 3,181,537 | $ | 134,791 | $ | 35,708 | $ | 170,499 | |
Additional issuances | 2,472,282 | 1,364,711 | 3,836,993 | - | - | - | |||||||
Exercised/converted | - | (266,459) | (266,459) | - | (29,439) | (29,439) | |||||||
Change in derivative liability | 22,441 | (972,686) | (950,245) | (22,440) | - | (22,440) | |||||||
Ending balance, June 30 | $ | 4,158,117 | $ | 1,643,709 | $ | 5,801,826 | $ | 112,351 | $ | 6,269 | $ | 118,620 | |
The derivative liability was valued using the binomial lattice method with the following inputs. | |||||||||||||
Three | Three | ||||||||||||
Months Ended | Months Ended | ||||||||||||
June 30, 2013 | June 30, 2012 | ||||||||||||
Expected life in years | 0.59 - 4.43 years | 0.17 - 4.28 years | |||||||||||
Stock price volatility | 112.3% - 270.1% | 48.5% - 191.6% | |||||||||||
Discount rate | 0.09% - 1.20% | 0.07% - 0.61% | |||||||||||
Expected dividends | None | None | |||||||||||
Forfeiture rate | 0% | 0% | |||||||||||
7_Equity
(7) Equity | 3 Months Ended |
Jun. 30, 2013 | |
Notes | ' |
(7) Equity | ' |
(7) Equity | |
Common Stock | |
The Company is authorized to issue 200,000,000 shares of common stock and no other class of stock at this time. The holders of common stock are entitled to one vote per share on all matters submitted to a vote of stockholders and are not entitled to cumulate their votes in the election of directors. The holders of common stock are entitled to any dividends that may be declared by the Board of Directors out of funds legally available therefore subject to the prior rights of holders of any outstanding shares of preferred stock and any contractual restrictions we have against the payment of dividends on common stock. In the event of our liquidation or dissolution, holders of common stock are entitled to share ratably in all assets remaining after payment of liabilities and the liquidation preferences of any outstanding shares of preferred stock. Holders of common stock have no preemptive or other subscription rights and no right to convert their common stock into any other securities. | |
During the three months ended June 30, 2013, the Company issued an aggregate of 5,417,756 shares of common stock for the conversion of $270,911 in convertible notes payable and accrued interest. This included 4,000,000 shares of common stock for the conversion of a $200,000 convertible note payable held by a related party entity owned by a Director of the Company. During the three months ended June 30, 2012 the Company issued an aggregate of 9,808,773 of common stock as payment of $715,439 of outstanding notes payable and accrued interest. | |
During the three months ended June 30, 2013, the Company issued an aggregate of 2,590,000 shares of common stock as payment for services, directors’ and employee compensation resulting in total expense of $318,550. During the three months ended June 30, 2012, the Company issued an aggregate of 2,500,000 shares of common stock as payment for services, directors’ and employee compensation resulting in an expense of $182,000. The fair value of the directors’ and employees’ service was determined by the closing price of the stock on date of grant and board of director minutes authorizing the shares. | |
During the three months ended June 30, 2013, the Company issued 196,468 shares of common stock for the exercise of warrants. There were no warrants exercised during the three months ended June 30, 2012. | |
During the three months ended June 30, 2012, the Company issued 23,600,000 shares of common stock as part of a private placement for total proceeds of $1,190,000. There were no shares sold during the three months ended June 30, 2013. | |
Warrants | |
During the three months ended June 30, 2013, the Company issued an aggregate of 17,600,000 warrants in connection with the Convertible Notes issued during the period, as well as 4,760,000 warrants for the payment of commissions associated with acquiring the Convertible Notes. These warrants have been accounted for as derivative liabilities (see Note 6). | |
During the three months ended June 30, 2013, the Company issued an additional 2,000,000 warrants as payment of directors’ services. The warrants have been accounted for as derivative liabilities (see Note 6). | |
There were no warrants issued during the three months ended June 30, 2012. |
8_Stock_Option_Plan
(8) Stock Option Plan | 3 Months Ended |
Jun. 30, 2013 | |
Notes | ' |
(8) Stock Option Plan: | ' |
(8) Stock Option Plan: | |
The Company’s 2011 Stock Option Plan provides for the grant of 20,000,000 incentive or non-statutory stock options to purchase common stock. Employees, who share the responsibility for the management growth or protection of the business of the Company and certain Non-Employee (“Selected Persons”), are eligible to receive options which are approved by a committee of the Board of Directors. These options vest over five years and are exercisable for a ten-year period from the date of the grant. | |
As of June 30, 2013, the Company had 2,000,000 options outstanding at an exercise price of $0.50 per share. These options were fully vested as of March 31, 2013, and therefore there no further compensation cost was recorded during the three months ended June 30, 2013. Stock option compensation cost recorded during the three months ended June 30, 2012 amounted to $20,131. No options were granted or exercised during the quarters ended June 30, 2013 and 2012. The outstanding options will expire in November 2018. |
9_Discontinued_Operations
(9) Discontinued Operations | 3 Months Ended | ||||||
Jun. 30, 2013 | |||||||
Notes | ' | ||||||
(9) Discontinued Operations: | ' | ||||||
9) Discontinued Operations: | |||||||
Prior to January 21, 2010, the Company had been actively engaged in acquiring underperforming mortgage loan portfolios and generating revenues from re-performing, sale of loans and fee revenue. As of January 21, 2010, the Company changed its primary business and abandoned the prior business. Accordingly, the assets and liabilities and results of operation related to this business have been classified as discontinued operations in the financial statements for all periods presented. During the three months ended June 30, 2013 and 2012, the Company had net income from discontinued operations of $0 and $484,420, respectively, which resulted from the write down of payables. | |||||||
The following table summarizes the liabilities classified as discontinued operations in the accompanying balance sheets: | |||||||
June 30, | March 31, | ||||||
2013 | 2013 | ||||||
(Unaudited) | |||||||
Notes payable, related party | $ | 85,041 | $ | 194,041 | |||
$ | 85,041 | $ | 194,041 | ||||
The Company entered into forbearance agreements with investors holding the notes that are included in liabilities to be disposed of. The new notes call for monthly payments and to be repaid in full by December 31, 2013. |
10_Subsequent_Events
(10) Subsequent Events | 3 Months Ended |
Jun. 30, 2013 | |
Notes | ' |
(10) Subsequent Events | ' |
(10) Subsequent Events | |
On July 1, 2013 and July 22, 2013 the Company issued 750,000 shares of common stock for consulting services. | |
On July 16, 2013 the Company was granted an extension with respect to meeting certain conditions under its operating agreement with the Union Pacific Railroad to October 31, 2013. All other conditions remain in place. | |
On July 17, 2013 the Company issued 2,000,000 restricted shares of common stock to employees per employment agreements. | |
On August 2, 2013 the Company issued 1,000,000 restricted shares of common stock for consulting services. |
2_Summary_of_Significant_Accou1
(2) Summary of Significant Accounting Policies: Risks and Uncertainties (Policies) | 3 Months Ended |
Jun. 30, 2013 | |
Policies | ' |
Risks and Uncertainties: | ' |
Risks and Uncertainties: | |
The Company operates in an industry that is subject to intense competition and potential government regulations. Significant changes in regulations and the inability of the Company to establish contracts with rail services providers could have a materially adverse impact on the Company’s operations. |
2_Summary_of_Significant_Accou2
(2) Summary of Significant Accounting Policies: Use of Estimates (Policies) | 3 Months Ended |
Jun. 30, 2013 | |
Policies | ' |
Use of Estimates: | ' |
Use of Estimates: | |
The preparation of financial statements in conformity with GAAP 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 reported periods. |
2_Summary_of_Significant_Accou3
(2) Summary of Significant Accounting Policies: Property and Equipment (Policies) | 3 Months Ended |
Jun. 30, 2013 | |
Policies | ' |
Property and Equipment: | ' |
Property and Equipment: | |
Property and equipment are recorded at historical cost and depreciated on a straight-line basis over their estimated useful lives of approximately five years once the individual assets are placed in service. The Company expenses all purchases of equipment with individual costs of under $500. |
2_Summary_of_Significant_Accou4
(2) Summary of Significant Accounting Policies: Intangible Assets (Policies) | 3 Months Ended |
Jun. 30, 2013 | |
Policies | ' |
Intangible Assets: | ' |
Intangible Assets: | |
Goodwill represents the excess of purchase price over tangible and intangible assets acquired, less liabilities assumed arising from the acquisition of the train business on November 23, 2009. Goodwill is not amortized, but is reviewed for potential impairment on an annual basis at the reporting unit level. As required by the “Intangibles – Goodwill and Other” topic of Financial Accounting Standards Board Accounting Standards Codification (“FASB ASC”), the Company conducted an analysis of the goodwill on its single reporting unit using the Company’s market capitalization (based on Level 1 inputs). For the three months ended June 30, 2013, the assessment for impairment found that there is no impairment of goodwill. The Company has no accumulated impairment losses on goodwill. |
2_Summary_of_Significant_Accou5
(2) Summary of Significant Accounting Policies: Deposit With Union Pacific (Policies) | 3 Months Ended |
Jun. 30, 2013 | |
Policies | ' |
Deposit With Union Pacific: | ' |
Deposit with Union Pacific: | |
On November 8, 2012, the Company signed an agreement with Union Pacific Railroad Company whereby the Company was granted a nonexclusive operating right to use Union Pacific railroad track between Daggett, California and Las Vegas, Nevada. In connection with this agreement, the Company made an earnest money deposit of $600,000 and is required to meet certain financial conditions, including the provision of a letter of credit in favor of Union Pacific in the amount of $27,444,145 on or before October 31, 2013. Failure to meet the conditions specified in the agreement will result in the Company losing the $600,000 deposit. |
2_Summary_of_Significant_Accou6
(2) Summary of Significant Accounting Policies: Income Taxes (Policies) | 3 Months Ended |
Jun. 30, 2013 | |
Policies | ' |
Income Taxes | ' |
Income Taxes: | |
Deferred tax assets and liabilities are recognized for the expected future tax consequences of events that have been included in the financial statements or tax returns. Under this method, deferred tax assets and liabilities are determined based on the differences between the financial reporting and tax bases of assets and liabilities using enacted tax rates in effect for the year in which the differences are expected to reverse. The deferred tax assets of the Company relate primarily to operating loss carryforwards for federal income tax purposes. A full valuation allowance for deferred tax assets has been provided because the Company believes it is not more likely than not that the deferred tax asset will be realized. Realization of deferred tax assets is dependent on the Company generating sufficient taxable income in future periods. | |
The Company’s goodwill is deductible for tax but not for book. This difference creates a deferred tax liability, which cannot be matched with the Company’s deferred tax asset. As a result, the Company cannot net it with its net operating loss carryforward and therefore records a deferred tax liability to reflect the future non-deductibility of its goodwill asset. The deferred tax liability at June 30, 2013 (unaudited) and March 31, 2013 was $60,405 and $55,914,,respectively. | |
The Company periodically evaluates its tax positions to determine whether it is more likely than not that such positions would be sustained upon examination by a tax authority for all open tax years, as defined by the statute of limitations, based on their technical merits. As of June 30, 2013 and March 31, 2013, the Company has not established a liability for uncertain tax positions. |
2_Summary_of_Significant_Accou7
(2) Summary of Significant Accounting Policies: Basic and Diluted Loss Per Share (Policies) | 3 Months Ended |
Jun. 30, 2013 | |
Policies | ' |
Basic and Diluted Loss Per Share: | ' |
Basic and Diluted Loss Per Share: | |
In accordance with FASB ASC 260, “Earnings Per Share,” the basic loss per common share is computed by dividing the net loss available to common stockholders after preferred stock dividends, by the weighted average common shares outstanding during the period. Diluted earnings per share reflect per share amounts that would have resulted if diluted potential common stock had been converted to common stock. Common stock equivalents have not been included in the earnings per share computation for the three months ended June 30, 2013 and 2012 as the amounts are anti-dilutive. As of June 30, 2013, the Company had 2,000,000 outstanding options which were excluded from the computation of net income per share because they are anti-dilutive. As of June 30, 2013, the Company also had convertible debt of $2,405,000 that is convertible into 48,100,000 shares of common stock which was excluded from the computation. As of June 30, 2013, the Company had 82,449,842 outstanding warrants which were also excluded from the computation because they were anti-dilutive. |
2_Summary_of_Significant_Accou8
(2) Summary of Significant Accounting Policies: Share Based Payment (Policies) | 3 Months Ended |
Jun. 30, 2013 | |
Policies | ' |
Share Based Payment: | ' |
Share Based Payment: | |
The Company issues stock, options and warrants as share-based compensation to employees and non-employees. | |
The Company accounts for its share-based compensation to employees in accordance FASB ASC 718. Stock-based compensation cost is measured at the grant date, based on the estimated fair value of the award, and is recognized as expense over the requisite service period. | |
The Company accounts for share-based compensation issued to non-employees and consultants in accordance with the provisions of FASB ASC 505-50 “Equity - Based Payments to Non-Employees.” Measurement of share-based payment transactions with non-employees is based on the fair value of whichever is more reliably measurable: (a) the goods or services received; or (b) the equity instruments issued. The final fair value of the share-based payment transaction is determined at the performance completion date. For interim periods, the fair value is estimated and the percentage of completion is applied to that estimate to determine the cumulative expense recorded. | |
The Company values stock compensation based on the market price on the measurement date. As described above, for employees this is the date of grant, and for non-employees, this is the date of performance completion. | |
The Company values stock options and warrants that do not qualify as derivative instruments using the Black-Scholes option pricing model. There were no options or warrants granted during the three months ended June 30, 2013 or 2012 that were valued used in the Black-Scholes model. | |
Certain warrants qualify as derivative instruments and are valued using the binomial lattice method. See discussion below regarding accounting for derivative liabilities. |
2_Summary_of_Significant_Accou9
(2) Summary of Significant Accounting Policies: Derivative Liabilities (Policies) | 3 Months Ended |
Jun. 30, 2013 | |
Policies | ' |
Derivative Liabilities | ' |
Derivative Liabilities: | |
In connection with the private placement of Convertible Notes beginning in February 2013, the Company became contingently obligated to issue shares of common stock in excess of the 200 million authorized under the Company’s certificate of incorporation. Consequently, the ability to settle these obligations with shares would be unavailable causing these obligations to potentially be settled in cash. This condition creates a derivative liability. | |
The Company has a sequencing policy regarding share settlement wherein instruments with the earliest issuance date would be settled first. The sequencing policy also considers contingently issuable additional shares, such as those issuable upon a stock split, to have an issuance date to coincide with the event giving rise to the additional shares. | |
Using this sequencing policy, all instruments convertible into common stock, including warrants and the conversion feature of notes payable, issued on and subsequent to February 13, 2013 are derivative liabilities. | |
The Company also has certain warrants and notes payable with elements that qualify as derivatives. The warrants have anti-dilution clauses that prevent calculation of the ultimate number of shares that may be issued upon exercise, and two of the notes payable had a variable conversion feature that similarly prevented the calculation of the number of shares into which they were convertible. | |
The Company values these warrants and notes payable using the binomial lattice method. The resulting liability is valued at each reporting date and the change in the liability is reflected as change in derivative liability in the statement of operations. |
Recovered_Sheet1
(2) Summary of Significant Accounting Policies: New Accounting Pronouncements (Policies) | 3 Months Ended |
Jun. 30, 2013 | |
Policies | ' |
New Accounting Pronouncements: | ' |
New Accounting Pronouncements: | |
There are no recent accounting pronouncements that management believes will have a material impact on the Company's present or future consolidated financial statements |
1_Organization_and_Basis_of_Pr1
(1) Organization and Basis of Presentation: Schedule of Error Corrections and Prior Period Adjustments (Tables) | 3 Months Ended | |||||||||
Jun. 30, 2013 | ||||||||||
Tables/Schedules | ' | |||||||||
Schedule of Error Corrections and Prior Period Adjustments | ' | |||||||||
For the three months ended June 30, 2012: | ||||||||||
As Previously | ||||||||||
Reported | Adjustments | Restated | ||||||||
Operating Expenses: | ||||||||||
Compensation and payroll taxes | $ | 326,115 | $ | 238,727 | $ | 564,842 | ||||
Selling, general and administrative | 89,738 | - | 89,738 | |||||||
Professional fees | 148,365 | (26,500) | 121,865 | |||||||
Depreciation expense | 160 | - | -160 | |||||||
Total expenses | 564,378 | 212,227 | 776,605 | |||||||
Loss from operations | (564,378) | (212,227) | (776,605) | |||||||
Interest expense | (10,553) | (3,217) | (13,770) | |||||||
Change in derivative liability | - | 22,440 | 22,440 | |||||||
Total other income (expense) | (10,553) | 19,223 | 8,670 | |||||||
Net loss from continuing operations before tax provision | (574,931) | (193,004) | (767,935) | |||||||
Provision for income taxes | - | (4,491) | (4,491) | |||||||
Net loss from continuing operations | (574,931) | (197,495) | (772,426) | |||||||
Discontinued operations: | ||||||||||
Income from discontinued operations, net of income tax | 484,420 | 484,420 | ||||||||
Net loss | $ | (90,511) | $ | (197,495) | $ | (288,006) | ||||
3_Property_and_Equipment_Sched
(3) Property and Equipment: Schedule of Other Assets, Noncurrent (Tables) | 3 Months Ended | |||||
Jun. 30, 2013 | ||||||
Tables/Schedules | ' | |||||
Schedule of Other Assets, Noncurrent | ' | |||||
June 30, | March 31, | |||||
2013 | 2013 | |||||
(Unaudited) | ||||||
Office equipment | $ | 51,458 | $ | 40,921 | ||
Software | 30,167 | 14,192 | ||||
Transportation equipment under construction | 435,610 | 354,557 | ||||
517,235 | 409,670 | |||||
Less: accumulated depreciation | (17,315) | (15,881) | ||||
$ | 499,920 | $ | 393,789 |
4_Notes_Payable_Schedule_of_Lo
(4) Notes Payable: Schedule of Long-term Debt Instruments (Tables) | 3 Months Ended | |||||||
Jun. 30, 2013 | ||||||||
Tables/Schedules | ' | |||||||
Schedule of Long-term Debt Instruments | ' | |||||||
June 30, | March 31, | |||||||
2013 | 2013 | |||||||
(Unaudited) | ||||||||
Secured promissory notes, dated May 17, 2011 through | ||||||||
May 17, 2012 to an investor bearing interest at 8% per annum, | ||||||||
payable on May 17, 2012. The Company is in default on this note. | 13,333 | 13,333 | ||||||
Total outstanding notes payable | $ | 13,333 | $ | 13,333 | ||||
5_Convertible_Notes_Payable_Sc
(5) Convertible Notes Payable: Schedule Of Convertible Notes Payable (Tables) | 3 Months Ended | ||||||
Jun. 30, 2013 | |||||||
Tables/Schedules | ' | ||||||
Schedule Of Convertible Notes Payable | ' | ||||||
June 30, | March 31, | ||||||
2013 | 2013 | ||||||
(Unaudited) | |||||||
Principal balance of convertible notes payable outstanding | $ | 2,405,000 | $ | 1,795,000 | |||
Less: discount on convertible notes payable | (1,654,599) | (1,678,958) | |||||
Convertible notes payable, net | $ | 750,401 | $ | 116,042 | |||
5_Convertible_Notes_Payable_Sc1
(5) Convertible Notes Payable: ScheduleOfFutureMaturitiesOfNotesPayable (Tables) | 3 Months Ended | |||
Jun. 30, 2013 | ||||
Tables/Schedules | ' | |||
ScheduleOfFutureMaturitiesOfNotesPayable | ' | |||
Year Ended | ||||
March 31, | ||||
2014 | $ | 2,405,000 | ||
Total | $ | 2,405,000 | ||
6_Derivative_Instruments_Sched
(6) Derivative Instruments: Schedule of Derivative Liabilities at Fair Value (Tables) | 3 Months Ended | ||||||||||||
Jun. 30, 2013 | |||||||||||||
Tables/Schedules | ' | ||||||||||||
Schedule of Derivative Liabilities at Fair Value | ' | ||||||||||||
Three Months Ended June 30, 2013 | Three Months Ended June 30, 2012 | ||||||||||||
Conversion Feature | Conversion Feature | ||||||||||||
of | of | ||||||||||||
Warrants | Notes Payable | Total | Warrants | Notes Payable | Total | ||||||||
Beginning balance, April 1 | $ | 1,663,394 | $ | 1,518,143 | $ | 3,181,537 | $ | 134,791 | $ | 35,708 | $ | 170,499 | |
Additional issuances | 2,472,282 | 1,364,711 | 3,836,993 | - | - | - | |||||||
Exercised/converted | - | (266,459) | (266,459) | - | (29,439) | (29,439) | |||||||
Change in derivative liability | 22,441 | (972,686) | (950,245) | (22,440) | - | (22,440) | |||||||
Ending balance, June 30 | $ | 4,158,117 | $ | 1,643,709 | $ | 5,801,826 | $ | 112,351 | $ | 6,269 | $ | 118,620 |
6_Derivative_Instruments_Warra
(6) Derivative Instruments: Warrant Value Assumptions Schedule (Tables) | 3 Months Ended | ||||
Jun. 30, 2013 | |||||
Tables/Schedules | ' | ||||
Warrant Value Assumptions Schedule | ' | ||||
Three | Three | ||||
Months Ended | Months Ended | ||||
June 30, 2013 | June 30, 2012 | ||||
Expected life in years | 0.59 - 4.43 years | 0.17 - 4.28 years | |||
Stock price volatility | 112.3% - 270.1% | 48.5% - 191.6% | |||
Discount rate | 0.09% - 1.20% | 0.07% - 0.61% | |||
Expected dividends | None | None | |||
Forfeiture rate | 0% | 0% |
9_Discontinued_Operations_Sche
(9) Discontinued Operations: Schedule Of Liabilities Classified As Discontinued Operations (Tables) | 3 Months Ended | ||||||
Jun. 30, 2013 | |||||||
Tables/Schedules | ' | ||||||
Schedule Of Liabilities Classified As Discontinued Operations | ' | ||||||
June 30, | March 31, | ||||||
2013 | 2013 | ||||||
(Unaudited) | |||||||
Notes payable, related party | $ | 85,041 | $ | 194,041 | |||
$ | 85,041 | $ | 194,041 | ||||
1_Organization_and_Basis_of_Pr2
(1) Organization and Basis of Presentation (Details) (USD $) | 3 Months Ended | ||
Jun. 30, 2013 | Jun. 30, 2012 | Mar. 31, 2013 | |
Details | ' | ' | ' |
Net loss | $3,216,547 | $288,006 | ' |
Accumulated Other Comprehensive Income (Loss), Net of Tax | 21,792,170 | ' | ' |
Convertible Notes Payable Outstanding | ' | ' | $2,405,000 |
Additional capital necessary to begin operations | '$10 million | ' | ' |
1_Organization_and_Basis_of_Pr3
(1) Organization and Basis of Presentation: Schedule of Error Corrections and Prior Period Adjustments (Details) (USD $) | 3 Months Ended | |
Jun. 30, 2013 | Jun. 30, 2012 | |
Compensation and payroll taxes | $849,329 | $564,842 |
Selling, general and administrative | 208,123 | 89,738 |
Professional fees | 581,788 | 121,865 |
Depreciation and amortization | -1,434 | -160 |
Total expenses | 1,640,674 | 776,605 |
Loss from operations | -1,640,674 | -776,605 |
Interest expense | -2,521,627 | -13,770 |
Change in derivative liability | 950,245 | 22,440 |
Other Operating Income (Expense), Net | ' | 8,670 |
Net loss from continuing operations before provision for income taxes | -3,212,056 | -767,935 |
Provision for income taxes | -4,491 | -4,491 |
Net loss from continuing operations | -3,216,547 | -772,426 |
Income from discontinued operations, net of income taxes | 0 | 484,420 |
Net loss | -3,216,547 | -288,006 |
Scenario, Previously Reported | ' | ' |
Compensation and payroll taxes | ' | 326,115 |
Selling, general and administrative | ' | 89,738 |
Professional fees | ' | 148,365 |
Depreciation and amortization | ' | 160 |
Total expenses | ' | 564,378 |
Loss from operations | ' | -564,378 |
Interest expense | ' | -10,553 |
Other Operating Income (Expense), Net | ' | -10,553 |
Net loss from continuing operations before provision for income taxes | ' | -574,931 |
Net loss from continuing operations | ' | -574,931 |
Income from discontinued operations, net of income taxes | ' | 484,420 |
Net loss | ' | -90,511 |
Restatement Adjustment | ' | ' |
Compensation and payroll taxes | ' | 238,727 |
Professional fees | ' | -26,500 |
Total expenses | ' | 212,227 |
Loss from operations | ' | -212,227 |
Interest expense | ' | -3,217 |
Change in derivative liability | ' | 22,440 |
Other Operating Income (Expense), Net | ' | 19,223 |
Net loss from continuing operations before provision for income taxes | ' | -193,004 |
Provision for income taxes | ' | -4,491 |
Net loss from continuing operations | ' | -197,495 |
Net loss | ' | ($197,495) |
Recovered_Sheet2
(2) Summary of Significant Accounting Policies: Deposit With Union Pacific (Details) (USD $) | Jun. 30, 2013 | Mar. 31, 2013 | Nov. 08, 2012 | |
Details | ' | ' | ' | |
Deposit with Union Pacific | ($600,000) | ($600,000) | $600,000 | [1] |
[1] | The Company is required to meet certain financial conditions, including the provision of a letter of credit in favor of Union Pacific in the amount of $27,444,145 on or before March 31, 2013. Failure to meet the conditions specified in the agreement will result in the Company losing the $600,000 deposit. |
Recovered_Sheet3
(2) Summary of Significant Accounting Policies: Income Taxes (Details) (USD $) | Jun. 30, 2013 | Mar. 31, 2013 |
Details | ' | ' |
Deferred Tax Liabilities, Net | $60,405 | $55,914 |
Recovered_Sheet4
(2) Summary of Significant Accounting Policies: Basic and Diluted Loss Per Share (Details) (USD $) | 3 Months Ended |
Jun. 30, 2013 | |
Details | ' |
Outstanding Employee Stock Options | 2,000,000 |
Convertible Debt | $2,405,000 |
Stock Issued During Period, Shares, Conversion of Convertible Securities | 48,100,000 |
Warrants and Rights Outstanding | $82,449,842 |
3_Property_and_Equipment_Sched1
(3) Property and Equipment: Schedule of Other Assets, Noncurrent (Details) (USD $) | Jun. 30, 2013 | Mar. 31, 2013 |
Property, Plant and Equipment, Gross | $517,235 | $409,670 |
Accumulated Depreciation, Depletion and Amortization, Property, Plant, and Equipment | -17,315 | -15,881 |
Property and equipment, net of accumulated depreciation | 499,920 | 393,789 |
Computer Software, Intangible Asset | ' | ' |
Property, Plant and Equipment, Gross | 30,167 | 14,192 |
Office Equipment | ' | ' |
Property, Plant and Equipment, Gross | 51,458 | 40,921 |
Railroad Transportation Equipment | ' | ' |
Property, Plant and Equipment, Gross | $435,610 | $354,557 |
4_Notes_Payable_Schedule_of_Lo1
(4) Notes Payable: Schedule of Long-term Debt Instruments (Details) (USD $) | Jun. 30, 2013 | Mar. 31, 2013 |
Details | ' | ' |
Secured promissory notes, dated May 17, 2011 through May 17, 2012 to an investor bearing interest at 8% per annum, payable on May 17, 2012 | $13,333 | $13,333 |
Short term notes payable | $13,333 | $13,333 |
5_Convertible_Notes_Payable_De
(5) Convertible Notes Payable (Details) (USD $) | 3 Months Ended | 15 Months Ended | |
Jun. 30, 2013 | Jun. 30, 2013 | Mar. 31, 2013 | |
Details | ' | ' | ' |
ProceedsFromConvertibleNote | ' | $1,900,000 | ' |
Convertible note share price | $0.05 | ' | ' |
Convertible note interest rate | 8.00% | ' | ' |
Convertible note converted amount | 105,000 | ' | ' |
Shares Issued For Convertible Note | 2,100,000 | ' | ' |
Convertible Note Gross Principal | ' | ' | 1,795,000 |
Proceeds from additional convertible notes | 880,000 | ' | ' |
Outstanding principal converted | 270,000 | ' | ' |
Accrued interest | 911 | ' | ' |
Shares issued from converted debt | 5,417,756 | ' | ' |
Principal Balance | 2,405,000 | 2,405,000 | ' |
Principal balance outstanding to Director of the Company | 50,000 | 50,000 | ' |
Warrants issued to purchase additional sharesn exercise price | $0.10 | ' | ' |
Shares isssued to Director of the Company | 1,000,000 | ' | ' |
Initial derivative liabilitiy | 1,372,237 | 1,372,237 | ' |
Convertible Notes Interest Expense | 1,401,191 | ' | ' |
Debt Issuance Cost | 521,351 | ' | ' |
Warrants Issued | 4,760,000 | ' | ' |
Amortization of capitalized debt | 155,391 | ' | ' |
Capitalized debt issuance costs balance | $497,760 | $497,760 | $116,329 |
5_Convertible_Notes_Payable_Sc2
(5) Convertible Notes Payable: Schedule Of Convertible Notes Payable (Details) (USD $) | Jun. 30, 2013 | Mar. 31, 2013 |
Details | ' | ' |
Principal balance of convertible notes payable outstanding | $2,405,000 | $1,795,000 |
Convertible notes payable discount | -1,654,599 | -1,678,958 |
Convertible Notes Payable, Noncurrent | $750,401 | $116,042 |
5_Convertible_Notes_Payable_Sc3
(5) Convertible Notes Payable: ScheduleOfFutureMaturitiesOfNotesPayable (Details) (USD $) | Jun. 30, 2013 |
Details | ' |
Principal Balance | $2,405,000 |
6_Derivative_Instruments_Sched1
(6) Derivative Instruments: Schedule of Derivative Liabilities at Fair Value (Details) (USD $) | 3 Months Ended | |
Jun. 30, 2013 | Jun. 30, 2012 | |
Warrants | 1,663,394 | 134,791 |
Derivative liability | $3,181,537 | $170,499 |
Additional Issuances Derivative Liability | 3,836,993 | ' |
Exercised/converted Derivative Liability | -266,459 | -29,439 |
Derivative Liability Change | -950,245 | -22,440 |
Derivative liability | 5,801,826 | 118,620 |
Debt | ' | ' |
Derivative liability | 1,518,143 | 35,708 |
Additional Issuances Derivative Liability | 1,364,711 | ' |
Exercised/converted Derivative Liability | -266,459 | -29,439 |
Derivative Liability Change | -972,686 | ' |
Derivative liability | 1,643,709 | 6,269 |
Warrant | ' | ' |
Additional Issuances Derivative Liability | 2,472,282 | ' |
Derivative Liability Change | 22,441 | -22,440 |
Derivative liability | $4,158,117 | $112,351 |
6_Derivative_Instruments_Warra1
(6) Derivative Instruments: Warrant Value Assumptions Schedule (Details) (USD $) | 3 Months Ended | |
Jun. 30, 2013 | Jun. 30, 2012 | |
Details | ' | ' |
WarrantValueAssumptionsExpectedLife | '0.59 - 4.43 years | '0.17 - 4.28 years |
WarrantValueAssumptionsStockPriceVolatility | '112.3% - 270.1% | '48.5% - 191.6% |
Warrant Value Assumption Discount Rate | '0.09% - 1.20% | '0.07% - 0.61% |
WarrantValueAssumptionsExpectedDividends | $0 | $0 |
WarrantValueAssumptionsForfeitureRate | 0.00% | 0.00% |
7_Equity_Details
(7) Equity (Details) (USD $) | 3 Months Ended | ||
Jun. 30, 2013 | Jun. 30, 2012 | Mar. 31, 2013 | |
Details | ' | ' | ' |
Common stock shares authorized | 200,000,000 | ' | 200,000,000 |
Shares issued from converted debt | 5,417,756 | ' | ' |
Convertible notes payable and accrued interest | $270,911 | ' | ' |
Shares converted held by related party entity | 4,000,000 | ' | ' |
Convertible note payable held by related party entity | 200,000 | ' | ' |
Shares issued as payment of notes payable | 9,808,773 | ' | ' |
Outstanding notes payable and accrued interest | 715,439 | ' | ' |
Shares issued for services | 2,590,000 | 2,500,000 | ' |
Services expense | 318,550 | 182,000 | ' |
Shares issued for warrants | 196,468 | ' | ' |
Shares issued for private placement | 23,600,000 | ' | ' |
Proceeds from private placement | $1,190,000 | ' | ' |
Warrants issued in connection with convertible notes | 17,600,000 | ' | ' |
Warrants issued for payments of commissions | 4,760,000 | ' | ' |
Warrants issued for payments of directors' services | 2,000,000 | ' | ' |
8_Stock_Option_Plan_Details
(8) Stock Option Plan (Details) (USD $) | 3 Months Ended |
Jun. 30, 2013 | |
Details | ' |
Grant of Stock Options Under Plan | 20,000,000 |
Outstanding Employee Stock Options | 2,000,000 |
Grant Date Market Price of Company's Stock | $0.50 |
Stock option compensation cost | $20,131 |
9_Discontinued_Operations_Deta
(9) Discontinued Operations (Details) (USD $) | 3 Months Ended | |
Jun. 30, 2013 | Jun. 30, 2012 | |
Details | ' | ' |
Income from discontinued operations, net of income taxes | $0 | $484,420 |
10_Subsequent_Events_Details
(10) Subsequent Events (Details) | Aug. 02, 2013 | Jul. 22, 2013 | Jul. 17, 2013 | Jul. 01, 2013 |
Details | ' | ' | ' | ' |
Shares issued for consulting services | ' | 750,000 | ' | 750,000 |
Restricted shares issued per employement agreement | ' | ' | 2,000,000 | ' |
Restricted shares issued for consulting services | 1,000,000 | ' | ' | ' |