Document_and_Entity_Informatio
Document and Entity Information | 9 Months Ended | |
Sep. 30, 2013 | Dec. 31, 2012 | |
Document And Entity Information | ' | ' |
Entity Registrant Name | 'Bollente Companies Inc. | ' |
Entity Central Index Key | '0001429393 | ' |
Document Type | '10-Q | ' |
Document Period End Date | 30-Sep-13 | ' |
Amendment Flag | 'false | ' |
Current Fiscal Year End Date | '--12-31 | ' |
Is Entity a Well-known Seasoned Issuer? | 'No | ' |
Is Entity a Voluntary Filer? | 'No | ' |
Is Entity's Reporting Status Current? | 'Yes | ' |
Entity Filer Category | 'Smaller Reporting Company | ' |
Entity Common Stock, Shares Outstanding | ' | 9,797,460 |
Document Fiscal Period Focus | 'Q3 | ' |
Document Fiscal Year Focus | '2013 | ' |
Balance_Sheets_Unaudited
Balance Sheets (Unaudited) (USD $) | Sep. 30, 2013 | Dec. 31, 2012 |
Current assets: | ' | ' |
Cash | $68,412 | $3,872 |
Prepaid expenses | 82,650 | 100,362 |
Prepaid stock compensation | 2,078,671 | 1,166,000 |
Total current assets | 2,229,733 | 1,270,234 |
Other assets: | ' | ' |
Security deposits | 1,500 | 1,500 |
Trademarks | 550 | 550 |
Website | 43,310 | 3,500 |
Total other assets | 45,360 | 5,550 |
Total assets | 2,275,093 | 1,275,784 |
Current liabilities: | ' | ' |
Accounts payable | 54,935 | 28,598 |
Accrued salaries - related party | 18,169 | 9,169 |
Accrued payroll taxes | 11,891 | 11,891 |
Notes payable - related party | 501,950 | 450 |
Accrued interest payable | ' | 221 |
Accrued interest payable - related party | 14,723 | 5,153 |
Line of credit - related party | 95,636 | 17,936 |
Notes payable, net of unamortized debt discount of $0 | 30,250 | 30,250 |
Total current liabilities | 727,554 | 103,668 |
Long-term liabilities: | ' | ' |
Notes payable - related party | ' | 500,000 |
Total long-term liabilities | ' | 500,000 |
Total liabilities | 727,554 | 603,668 |
Stockholders' deficit: | ' | ' |
Preferred stock, $0.001 par value, 10,000,000 shares authorized, no shares issued and outstanding as of September 30, 2013 and December 31, 2012, respectively | ' | ' |
Common stock, $0.001 par value, 100,000,000 shares authorized, 9,797,460 and 6,497,460 shares issued and outstanding as of September 30, 2013 and December 31, 2012, respectively | 9,798 | 8,153 |
Additional paid-in capital | 6,482,976 | 3,928,580 |
Subscriptions payable | 29,250 | 7,500 |
Deficit accumulated during development stage | -4,974,485 | -3,272,117 |
Total stockholders' deficit | 1,547,539 | 659,613 |
Total liabilities and stockholders' deficit | $2,275,093 | $1,275,784 |
Balance_Sheets_Parenthetical
Balance Sheets (Parenthetical) (USD $) | Sep. 30, 2013 | Dec. 31, 2012 |
Statement of Financial Position [Abstract] | ' | ' |
Preferred stock, par value | $0.00 | $0.00 |
Preferred stock, shares authorized | 10,000,000 | 10,000,000 |
Preferred stock, shares issued and outstanding | 0 | 0 |
Common stock, par value | $0.00 | $0.00 |
Common stock, shares authorized | 100,000,000 | 100,000,000 |
Common stock, shares issued and outstanding | 9,797,460 | 9,797,460 |
Statements_of_Operations_Unaud
Statements of Operations (Unaudited) (USD $) | 3 Months Ended | 9 Months Ended | 67 Months Ended | ||
Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2013 | |
Income Statement [Abstract] | ' | ' | ' | ' | ' |
Revenue | ' | ' | ' | ' | ' |
Operating expenses: | ' | ' | ' | ' | ' |
General and administrative | 11,506 | 13,894 | 33,520 | 36,589 | 160,415 |
Executive compensation | 28,181 | 23,435 | 79,202 | 125,344 | 476,904 |
Product development - related party | ' | ' | ' | ' | 336,014 |
Research and development | 16,320 | 683 | 157,181 | 3,495 | 262,261 |
Professional fees | 684,500 | 150,415 | 1,399,596 | 639,942 | 3,593,368 |
Total operating expenses | 740,507 | 188,427 | 1,669,499 | 805,370 | 4,828,962 |
Other expenses: | ' | ' | ' | ' | ' |
Interest expense - related party | -11,638 | -11,135 | -32,611 | -32,795 | -113,663 |
Interest expense | -72 | -55 | -258 | -3,044 | -31,860 |
Total other expenses | -11,710 | -11,190 | -32,869 | -35,839 | -145,523 |
Net loss | ($752,217) | ($199,617) | ($1,702,368) | ($841,209) | ($4,974,485) |
Net loss per common share - basic | ($0.08) | ($0.02) | ($0.20) | ($0.10) | ' |
Weighted average number of common shares outstanding - basic | 8,907,080 | 11,359,989 | 8,406,764 | 8,261,060 | ' |
Statements_of_Cash_Flows_Unaud
Statements of Cash Flows (Unaudited) (USD $) | 9 Months Ended | 67 Months Ended | |
Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2013 | |
CASH FLOWS FROM OPERATING ACTIVITIES | ' | ' | ' |
Net loss | ($1,702,368) | ($841,209) | ($4,974,485) |
Adjustments to reconcile net loss to net cash used in operating activities: | ' | ' | ' |
Shares issued for services | 1,342,829 | 267,000 | 1,659,829 |
Shares issued for employment agreement | 66,750 | 102,851 | 396,850 |
Shares issued for prepaid stock compensation | ' | 328,750 | 1,214,000 |
Warrants issued for services | ' | ' | 308,176 |
Write-off of inventory deposit | ' | ' | 21,000 |
Non-cash financing cost | ' | ' | 22,056 |
Amortization of deferred financing cost | ' | 1,980 | 6,600 |
Amortization of debt discount | ' | 900 | 3,000 |
Accrued rent expense - related party line of credit | ' | 19,000 | ' |
Changes in operating assets and liabilities: | ' | ' | ' |
(Increase) decrease in prepaid expenses | 17,712 | -17,255 | -89,650 |
Decrease in other receivables | ' | ' | -14,000 |
(Increase) in security deposits | ' | ' | -1,500 |
Increase in accounts payable | 26,337 | -31,836 | 139,856 |
Increase in accounts payable - related party | ' | ' | 343 |
Increase in accrued salaries - related party | 9,000 | 14,000 | 18,169 |
Increase in accrued payroll taxes | ' | 8,494 | 11,891 |
Increase in deferred revenue | ' | ' | 14,235 |
Increase in accrued interest payable | -221 | 565 | 400 |
Increase in accrued interest payable - related party | 10,111 | 15,394 | 15,264 |
Net cash used in operating activities | -229,850 | -131,366 | -1,247,966 |
CASH FLOWS FROM INVESTING ACTIVITIES | ' | ' | ' |
Purchase trademarks | ' | ' | -550 |
Purchase website costs | -39,810 | -2,000 | -43,310 |
Payments for due from related party | ' | ' | -44,372 |
Repayments from due from related party | ' | ' | 40,000 |
Net cash used in investing activities | -39,810 | -2,000 | -48,232 |
CASH FLOWS FROM FINANCING ACTIVITIES | ' | ' | ' |
Bank overdraft | ' | ' | ' |
Proceeds from notes payable - related party | 131,500 | 200 | 145,622 |
Repayments of notes payable - related party | ' | ' | -1,550 |
Proceeds from line of credit - related party | 77,700 | 7,500 | 162,970 |
Repayments of line of credit - related party | ' | ' | -67,334 |
Proceeds from notes payable | ' | ' | 41,760 |
Repayments for notes payable | ' | ' | -2,750 |
Proceeds from sale of common stock, net of offering costs | 125,000 | 125,000 | 1,078,782 |
Donated capital | ' | ' | 7,110 |
Net cash provided by financing activities | 334,200 | 132,700 | 1,364,610 |
NET CHANGE IN CASH | 64,540 | -666 | 68,412 |
CASH AT BEGINNING OF YEAR | 3,872 | 864 | ' |
CASH AT END OF YEAR | 68,412 | 198 | 68,412 |
SUPPLEMENTAL INFORMATION: | ' | ' | ' |
Interest paid | ' | 17,000 | 75,497 |
Income taxes paid | ' | ' | ' |
Non-cash investing and financing activities: | ' | ' | ' |
Reclass accounts payable related party to accounts payable | ' | ' | 343 |
Reclass notes payable related party to notes payable | ' | ' | 11,760 |
Shares issued as settlement of accounts payable | ' | ' | 115,718 |
Shares issued for prepaid stock compensation | 2,176,000 | ' | 3,895,375 |
Warrants issued for services | ' | ' | 308,176 |
Deemed distribution to majority shareholder | ' | ' | ($516,563) |
SUMMARY_OF_SIGNIFICANT_ACCOUNT
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | 9 Months Ended |
Sep. 30, 2013 | |
Accounting Policies [Abstract] | ' |
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | ' |
NOTE 1 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | |
Basis of presentation | |
The interim financial statements included herein, presented in accordance with United States generally accepted accounting principles and stated in US dollars, have been prepared by the Company, without audit, pursuant to the rules and regulations of the Securities and Exchange Commission. Certain information and footnote disclosures normally included in financial statements prepared in accordance with generally accepted accounting principles have been condensed or omitted pursuant to such rules and regulations, although the Company believes that the disclosures are adequate to make the information presented not misleading. | |
These statements reflect all adjustments, consisting of normal recurring adjustments, which in the opinion of management, are necessary for a fair presentation of the information contained therein. It is suggested that these interim financial statements be read in conjunction with the financial statements of the Company for the years ended December 31, 2012 and 2011 and notes thereto included in the Company’s 10-K annual report. The Company follows the same accounting policies in the preparation of interim reports. | |
Results of operations for the interim period are not indicative of annual results. | |
Principles of consolidation | |
The consolidated financial statements include the accounts of Bollente Companies, Inc. and its wholly owned subsidiaries. On May 16, 2010, the Company acquired 100% of the outstanding stock of Bollente, Inc. On the date of acquisition, Bollente, Inc. was 2.78% owned and controlled 100% by Robertson J. Orr, a majority shareholder and officer and director of Bollente Companies, Inc. and the acquisition was accounted for by means of a pooling of the entities from the date of inception of Bollente Companies, Inc. on March 7, 2008 because the entities were under common control. All significant inter-company transactions and balances have been eliminated. | |
Use of estimates | |
The preparation of financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect 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 revenue and expenses during the reporting period. Actual results could differ significantly from those estimates. | |
Cash and cash equivalents | |
For the purpose of the statements of cash flows, all highly liquid investments with an original maturity of three months or less are considered to be cash equivalents. The carrying value of these investments approximates fair value. | |
Website | |
The Company capitalizes the costs associated with the development of the Company’s website pursuant to ASC Topic 350. Other costs related to the maintenance of the website are expensed as incurred. Amortization is provided over the estimated useful lives of 3 years using the straight-line method for financial statement purposes. The Company plans to commence amortization upon completion and release of the Company’s fully operational website. | |
Stock-based compensation | |
The Company records stock based compensation in accordance with the guidance in ASC Topic 505 and 718 which requires the Company to recognize expenses related to the fair value of its employee stock option awards. This eliminates accounting for share-based compensation transactions using intrinsic value and requires instead that such transactions be accounted for using a fair-value-based method. The Company recognizes the cost of all share-based awards on a graded vesting basis over the vesting period of the award. | |
The Company accounts for equity instruments issued in exchange for the receipt of goods or services from other than employees in accordance with FASB ASC 718-10 and the conclusions reached by the FASB ASC 505-50. Costs are measured at the estimated fair market value of the consideration received or the estimated fair value of the equity instruments issued, whichever is more reliably measurable. The value of equity instruments issued for consideration other than employee services is determined on the earliest of a performance commitment or completion of performance by the provider of goods or services as defined by FASB ASC 505-50. | |
Earnings per share | |
The Company follows ASC Topic 260 to account for the earnings per share. Basic earning per common share (“EPS”) calculations are determined by dividing net income by the weighted average number of shares of common stock outstanding during the year. Diluted earning per common share calculations are determined by dividing net income by the weighted average number of common shares and dilutive common share equivalents outstanding. During periods when common stock equivalents, if any, are anti-dilutive they are not considered in the computation. | |
Fair value of financial instruments | |
Fair value estimates discussed herein are based upon certain market assumptions and pertinent information available to management as of September 30, 2013. The respective carrying value of certain on-balance-sheet financial instruments approximated their fair values. These financial instruments include cash, prepaid expenses and accounts payable. 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. | |
Level 1: The preferred inputs to valuation efforts are “quoted prices in active markets for identical assets or liabilities,” with the caveat that the reporting entity must have access to that market. Information at this level is based on direct observations of transactions involving the same assets and liabilities, not assumptions, and thus offers superior reliability. However, relatively few items, especially physical assets, actually trade in active markets. | |
Level 2: FASB acknowledged that active markets for identical assets and liabilities are relatively uncommon and, even when they do exist, they may be too thin to provide reliable information. To deal with this shortage of direct data, the board provided a second level of inputs that can be applied in three situations. | |
Level 3: If inputs from levels 1 and 2 are not available, FASB acknowledges that fair value measures of many assets and liabilities are less precise. The board describes Level 3 inputs as “unobservable,” and limits their use by saying they “shall be used to measure fair value to the extent that observable inputs are not available.” This category allows “for situations in which there is little, if any, market activity for the asset or liability at the measurement date”. Earlier in the standard, FASB explains that “observable inputs” are gathered from sources other than the reporting company and that they are expected to reflect assumptions made by market participants. | |
Reclassifications | |
Certain reclassifications have been made to the prior quarters’ financial statements to conform to the current quarter presentation. These reclassifications had no effect on previously reported results of operations. The Company reclassified payroll and compensation to its executive from general and administrative expense to executive compensation. The company also reclassified interest payable – related party to interest payable, as the loan holder is no longer considered a related party. | |
Recent pronouncements | |
The Company has evaluated recent accounting pronouncements through the filing date and believes that none of them will have a material effect on the Company’s financial statements. | |
GOING_CONCERN
GOING CONCERN | 9 Months Ended |
Sep. 30, 2013 | |
Notes to Financial Statements | ' |
GOING CONCERN | ' |
NOTE 2 – GOING CONCERN | |
The accompanying financial statements have been prepared assuming that the Company will continue as a going concern, which contemplates the recoverability of assets and the satisfaction of liabilities in the normal course of business. As noted above, the Company is in the development stage and, accordingly, has not yet generated revenues from operations. Since its inception, the Company has been engaged substantially in financing activities and developing its business plan and incurring start up costs and expenses. As a result, the Company incurred accumulated net losses from Inception (March 7, 2008) through the period ended September 30, 2013 of ($4,974,485). In addition, the Company’s development activities since inception have been financially sustained through debt and equity financing. | |
The ability of the Company to continue as a going concern is dependent upon its ability to raise additional capital from the sale of common stock and, ultimately, the achievement of significant operating revenues. These financial statements do not include any adjustments relating to the recoverability and classification of recorded asset amounts, or amounts and classification of liabilities that might result from this uncertainty. |
PREPAID_STOCK_COMPENSATION
PREPAID STOCK COMPENSATION | 9 Months Ended |
Sep. 30, 2013 | |
Notes to Financial Statements | ' |
PREPAID STOCK COMPENSATION | ' |
NOTE 3 – PREPAID STOCK COMPENSATION | |
During the month ended November 30, 2012, the Company issued a total of 500,000 shares of common stock as part of a consulting agreements totaling $1,325,000. The shares were valued according to the fair value of the common stock. The value of the shares was recorded as prepaid expense and is being amortized over one year which is the related service period of the respective agreements. For the nine months ended September 30, 2013, the Company expensed $993,750 as professional fees with a remaining prepaid expense amount totaling $172,250 at September 30, 2013. The balance at December 31, 2012 was $1,166,000. | |
During the quarter ended September 30, 2013, the Company issued a total of 1,065,000 shares of common stock as part of a consulting agreements totaling $2,176,000. The shares were valued according to the fair value of the common stock. The value of the shares was recorded as prepaid expense and is being amortized over 6 months to one year which is the related service period of the respective agreements. For the nine months ended September 30, 2013, the Company expensed $269,579 as professional fees with a remaining prepaid expense amount totaling $1,906,421 at September 30, 2013. The balance at December 31, 2012 was $0. |
WEBSITE
WEBSITE | 9 Months Ended | ||||||||
Sep. 30, 2013 | |||||||||
Notes to Financial Statements | ' | ||||||||
WEBSITE | ' | ||||||||
NOTE 4 – WEBSITE | |||||||||
Website consists of the following at: | |||||||||
September 30, | 31-Dec-12 | ||||||||
2013 | |||||||||
Website | $ | 43,310 | $ | 3,500 | |||||
Less: Accumulated amortization | — | — | |||||||
Website, net | $ | 43,310 | $ | 3,500 | |||||
Amortization expense for the three months ended September 30, 2013 and 2012 was $0 and $0, respectively. Amortization expense for the nine months ended September 30, 2013 and 2012 was $0 and $0, respectively. |
NOTES_PAYABLE_RELATED_PARTY
NOTES PAYABLE b RELATED PARTY | 9 Months Ended | ||||||||
Sep. 30, 2013 | |||||||||
Notes to Financial Statements | ' | ||||||||
NOTES PAYABLE b RELATED PARTY | ' | ||||||||
NOTE 5 – NOTES PAYABLE – RELATED PARTY | |||||||||
Notes payable consist of the following at: | |||||||||
September 30, | 31-Dec-12 | ||||||||
2013 | |||||||||
Note payable to an officer, director and shareholder, unsecured, 0% interest, due upon demand | $ | 450 | $ | 450 | |||||
Note payable with a shareholder, unsecured, 0% interest, due upon demand | 1,500 | — | |||||||
Note payable with a shareholder, unsecured, 5% interest, due February 2014 | 500,000 | — | |||||||
Notes Payable – Current | $ | 501,950 | $ | 450 | |||||
September 30, | 31-Dec-12 | ||||||||
2013 | |||||||||
Line of credit for up to $150,000, from a shareholder, unsecured, 5% interest, due December 2013 | $ | 95,636 | $ | 17,936 | |||||
Line of credit – Current | $ | 95,636 | $ | 17,936 | |||||
During the nine months ended September 30, 2013, the note payable was reclassified to current liabilities from long term liabilities. | |||||||||
Interest expense for the three months ended September 30, 2013 and 2012 was $11,638 and $11,135, respectively. Interest expense for the nine months ended September 30, 2013 and 2012 was $32,611 and $32,795, respectively. |
NOTES_PAYABLE
NOTES PAYABLE | 9 Months Ended | ||||||||
Sep. 30, 2013 | |||||||||
Notes to Financial Statements | ' | ||||||||
NOTES PAYABLE | ' | ||||||||
NOTE 6 – NOTES PAYABLE | |||||||||
September 30, | 31-Dec-12 | ||||||||
2013 | |||||||||
Note payable to an unrelated third party, unsecured, due May 2012, in default as of June 30, 2013 | $ | 30,250 | $ | 30,250 | |||||
Unamortized debt discount | — | — | |||||||
Notes Payable – Current | $ | 30,250 | $ | 30,250 | |||||
Interest expense, including the amortization of the debt discount and the amortization of the deferred financing cost for the three months ended September 30, 2013 and 2012 was $72 and $55, respectively. Interest expense, including the amortization of the debt discount and the amortization of the deferred financing cost for the nine months ended September 30, 2013 and 2012 was $258 and $3,044, respectively. |
LONG_TERM_NOTES_PAYABLE_RELATE
LONG TERM NOTES PAYABLE b RELATED PARTY | 9 Months Ended | ||||||||
Sep. 30, 2013 | |||||||||
Notes to Financial Statements | ' | ||||||||
LONG TERM NOTES PAYABLE b RELATED PARTY | ' | ||||||||
NOTE 7 – LONG TERM NOTES PAYABLE – RELATED PARTY | |||||||||
Notes payable consists of the following at: | |||||||||
September 30, 2013 | 31-Dec-12 | ||||||||
Note payable with a shareholder, unsecured, 5% interest, due February 2014 | $ | — | $ | 500,000 | |||||
Notes Payable – Long Term | $ | — | $ | 500,000 | |||||
During the nine months ended September 30, 2013, the note payable was reclassified to current liabilities from long term liabilities. | |||||||||
Interest expense for the three months ended September 30, 2013 and 2012 was $10,192 and $10,222, respectively. Interest expense for the nine months ended September 30, 2013 and 2012 was $30,137 and $30,444, respectively. |
STOCKHOLDERS_EQUITY
STOCKHOLDERS' EQUITY | 9 Months Ended |
Sep. 30, 2013 | |
Notes to Financial Statements | ' |
STOCKHOLDERS' EQUITY | ' |
NOTE 8 – STOCKHOLDERS’ EQUITY | |
The Company is authorized to issue 10,000,000 shares of it $0.001 par value preferred stock and 100,000,000 shares of its $0.001 par value common stock. | |
On May 11, 2009, the Company effected a 10-for-1 forward stock split of its $0.001 par value common stock. On October 22, 2010, the Company effected a 1-for-50 reverse stock split of its $0.001 par value common stock. | |
All shares and per share amounts have been retroactively restated to reflect the split discussed above. | |
Common stock | |
During the nine months ended September 30, 2013 the Company entered into the following transactions to issue common stock: | |
On February 28, 2013, the Company recorded a stock payable totaling $26,250 for 15,000 shares of common stock owed to an officer, director and shareholder of the Company as part of his employment agreement. The shares were valued according to the fair value of the common stock as of February 28, 2013. The shares were issued in August 2013. | |
On March 31, 2013, the Company recorded a stock payable totaling $9,500 for 10,000 shares of common stock owed to consultant as part of his consulting agreement. The shares were valued according to the fair value of the common stock as of March 31, 2013. The shares were issued in August 2013. | |
On May 31, 2013, the Company recorded a stock payable totaling $18,750 for 15,000 shares of common stock owed to an officer, director and shareholder of the Company as part of his employment agreement. The shares were valued according to the fair value of the common stock as of May 31, 2013. The shares were issued in August 2013. | |
On July 21, 2013, the Company issued 100,000 shares of common stock for consulting services totaling $230,000 to be performed over a period of one year. The shares were valued according to the fair value of the common stock. | |
On August 6, 2013, the Company issued 250,000 shares of common stock for consulting services totaling $500,000 to be performed over a period of one year. The shares were valued according to the fair value of the common stock. | |
On August 14, 2013, the Company issued 250,000 shares of common stock for consulting services totaling $500,000 to be performed over a period of six months. The shares were valued according to the fair value of the common stock. | |
On August 15, 2013, the Company issued a total of 415,000 shares of common stock for the amendment of an existing consulting agreement and to extend the services from November 2013 to April 2014 totaling $830,000 to be performed over a period of five and a half months. The shares were valued according to the fair value of the common stock. | |
On August 15, 2013, the Company issued 20,000 shares of common stock owed to consultant as part of his consulting agreement. The shares were valued according to the fair value of the common stock as of August 15, 2013. | |
Common stock (continued) | |
On September 2, 2013, the Company issued 260,000 shares of common stock in exchange for a settlement of debt with a related party. The related party is a shareholder of the Company. The principal amount of the debt was $130,000 and the accrued interest was $542. Since the settlement of debt was with a related party, the Company treated this as a capital transaction and no gain on the debt settlement was recorded. | |
On September 6, 2013, the Company issued 50,000 shares of common stock for consulting services totaling $116,000 to be performed over a period of six months. The shares were valued according to the fair value of the common stock. | |
During September 2013, the Company issued a total of 250,000 shares of common stock for cash received of $125,000. | |
On September 30, 2013, the Company issued 10,000 shares of common stock owed to consultant as part of his consulting agreement. The shares were valued according to the fair value of the common stock as of September 30, 2013. |
WARRANTS
WARRANTS | 9 Months Ended | |||
Sep. 30, 2013 | ||||
Notes to Financial Statements | ' | |||
WARRANTS | ' | |||
NOTE 9 – WARRANTS | ||||
The following is a summary of the status of all of the Company’s stock warrants as of September 30, 2013 and changes during the nine months ended on that date: | ||||
Number | Weighted-Average | |||
of Warrants | Exercise Price | |||
Outstanding at January 1, 2013 | 20,000 | $ 15.50 | ||
Granted | - | $ 0.00 | ||
Exercised | - | $ 0.00 | ||
Expired | -20,000 | $ 15.50 | ||
Outstanding at September 30, 2013 | - | $ 0.00 | ||
Warrants exercisable at September 30, 2013 | - | $ 0.00 |
AGREEMENTS
AGREEMENTS | 9 Months Ended |
Sep. 30, 2013 | |
Notes to Financial Statements | ' |
AGREEMENTS | ' |
NOTE 10 – AGREEMENTS | |
Lease agreement | |
On January 3, 2013, the Company executed a sublease agreement with Perigon Companies, LLC, a related party. The lease term is one year at a rate of $3,500 per month. The Company paid a refundable security deposit of $1,500. Rent expense for the three months ended September 30, 2013 and 2012 was $10,500 and $10,500, respectively. Rent expense for the nine months ended September 30, 2013 and 2012 was $31,500 and $31,500, respectively. | |
Employment agreement | |
Effective March 1, 2013, the Company entered into an amended employment agreement with the President of the Company. The officer will receive annual compensation of $12,000 due monthly. Additionally, the Company will issue 15,000 shares of common stock per quarter starting from the three months ended May 31, 2013. Compensation expense for the three months ended September 30, 2013 and 2012 was $24,750 and $31,350, respectively. Compensation expense for the nine months ended September 30, 2013 and 2012 was $75,750 and $116,850, respectively. |
PRIOR_PERIOD_ADJUSTMENT
PRIOR PERIOD ADJUSTMENT | 9 Months Ended | |||
Sep. 30, 2013 | ||||
Notes to Financial Statements | ' | |||
PRIOR PERIOD ADJUSTMENT | ' | |||
NOTE 11 – PRIOR PERIOD ADJUSTMENT | ||||
During the nine months ended September 30, 2013, the management of the Company discovered documentation and realized that they should have adjusted off liabilities due to a related party to additional paid in capital when the forgiveness of debt was signed during 2011. The Company has corrected the error during 2013 and presented the December 31, 2012 balance sheet with the correction. There is no need to restate the prior period financial statements because the changes were immaterial to the overall financial statements. | ||||
BALANCE SHEET | As Originally | Adjustments | As | |
AS OF DECEMBER 31, 2012 | Filed | Increase/(Decrease) | Restated | |
ASSETS: | ||||
Cash | $ 3,872 | $ - | $ 3,872 | |
Prepaid expenses | 100,362 | - | 100,362 | |
Prepaid stock compensation | 1,166,000 | - | 1,166,000 | |
Deferred financing cost, net | - | - | - | |
Security deposits | 1,500 | - | 1,500 | |
Trademarks | 550 | - | 550 | |
Website | 3,500 | - | 3,500 | |
TOTAL ASSETS | $ 1,275,784 | $ - | $1,275,784 | |
LIABILITIES: | ||||
Accounts payable | $ 28,941 | $ (343) | $ 28,598 | |
Accrued salaries - related party | 9,169 | - | 9,169 | |
Accrued payroll taxes | 11,891 | - | 11,891 | |
Notes payable - related party | 450 | - | 450 | |
Accrued interest payable | 621 | (400) | 221 | |
Accrued interest payable - related party | 5,153 | - | 5,153 | |
Line of credit - related party | 17,936 | - | 17,936 | |
Notes payable | 42,010 | (11,760) | 30,250 | |
Long term notes payable - related party | 500,000 | - | 500,000 | |
EQUITY: | ||||
Preferred stock | - | - | ||
Common stock | 8,153 | - | 8,153 | |
Additional paid in capital | 3,916,077 | 12,503 | 3,928,580 | |
Subscriptions payable | 7,500 | - | 7,500 | |
Deficit accumulated during development stage | (3,272,117) | (3,272,117) | ||
TOTAL LIABILITIES AND EQUITY | $ 1,275,784 | $ - | $1,275,784 |
SUBSEQUENT_EVENTS
SUBSEQUENT EVENTS | 9 Months Ended |
Sep. 30, 2013 | |
Subsequent Events [Abstract] | ' |
SUBSEQUENT EVENTS | ' |
NOTE 12 – SUBSEQUENT EVENTS | |
During October 2013, the Company sold 140,000 shares of common stock for cash of $70,000. |
SUMMARY_OF_SIGNIFICANT_ACCOUNT1
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Policies) | 9 Months Ended |
Sep. 30, 2013 | |
Accounting Policies [Abstract] | ' |
Basis of presentation | ' |
Basis of presentation | |
The interim financial statements included herein, presented in accordance with United States generally accepted accounting principles and stated in US dollars, have been prepared by the Company, without audit, pursuant to the rules and regulations of the Securities and Exchange Commission. Certain information and footnote disclosures normally included in financial statements prepared in accordance with generally accepted accounting principles have been condensed or omitted pursuant to such rules and regulations, although the Company believes that the disclosures are adequate to make the information presented not misleading. | |
These statements reflect all adjustments, consisting of normal recurring adjustments, which in the opinion of management, are necessary for a fair presentation of the information contained therein. It is suggested that these interim financial statements be read in conjunction with the financial statements of the Company for the years ended December 31, 2012 and 2011 and notes thereto included in the Company’s 10-K annual report. The Company follows the same accounting policies in the preparation of interim reports. | |
Results of operations for the interim period are not indicative of annual results. | |
Principles of consolidation | ' |
Principles of consolidation | |
The consolidated financial statements include the accounts of Bollente Companies, Inc. and its wholly owned subsidiaries. On May 16, 2010, the Company acquired 100% of the outstanding stock of Bollente, Inc. On the date of acquisition, Bollente, Inc. was 2.78% owned and controlled 100% by Robertson J. Orr, a majority shareholder and officer and director of Bollente Companies, Inc. and the acquisition was accounted for by means of a pooling of the entities from the date of inception of Bollente Companies, Inc. on March 7, 2008 because the entities were under common control. All significant inter-company transactions and balances have been eliminated. | |
Use of estimates | ' |
Use of estimates | |
The preparation of financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect 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 revenue and expenses during the reporting period. Actual results could differ significantly from those estimates. | |
Cash and cash equivalents | ' |
Cash and cash equivalents | |
For the purpose of the statements of cash flows, all highly liquid investments with an original maturity of three months or less are considered to be cash equivalents. The carrying value of these investments approximates fair value. | |
Website | ' |
Website | |
The Company capitalizes the costs associated with the development of the Company’s website pursuant to ASC Topic 350. Other costs related to the maintenance of the website are expensed as incurred. Amortization is provided over the estimated useful lives of 3 years using the straight-line method for financial statement purposes. The Company plans to commence amortization upon completion and release of the Company’s fully operational website. | |
Stock-based compensation | ' |
Stock-based compensation | |
The Company records stock based compensation in accordance with the guidance in ASC Topic 505 and 718 which requires the Company to recognize expenses related to the fair value of its employee stock option awards. This eliminates accounting for share-based compensation transactions using intrinsic value and requires instead that such transactions be accounted for using a fair-value-based method. The Company recognizes the cost of all share-based awards on a graded vesting basis over the vesting period of the award. | |
The Company accounts for equity instruments issued in exchange for the receipt of goods or services from other than employees in accordance with FASB ASC 718-10 and the conclusions reached by the FASB ASC 505-50. Costs are measured at the estimated fair market value of the consideration received or the estimated fair value of the equity instruments issued, whichever is more reliably measurable. The value of equity instruments issued for consideration other than employee services is determined on the earliest of a performance commitment or completion of performance by the provider of goods or services as defined by FASB ASC 505-50. | |
Earnings per share | ' |
Earnings per share | |
The Company follows ASC Topic 260 to account for the earnings per share. Basic earning per common share (“EPS”) calculations are determined by dividing net income by the weighted average number of shares of common stock outstanding during the year. Diluted earning per common share calculations are determined by dividing net income by the weighted average number of common shares and dilutive common share equivalents outstanding. During periods when common stock equivalents, if any, are anti-dilutive they are not considered in the computation. | |
Fair value of financial instruments | ' |
Fair value of financial instruments | |
Fair value estimates discussed herein are based upon certain market assumptions and pertinent information available to management as of September 30, 2013. The respective carrying value of certain on-balance-sheet financial instruments approximated their fair values. These financial instruments include cash, prepaid expenses and accounts payable. 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. | |
Level 1: The preferred inputs to valuation efforts are “quoted prices in active markets for identical assets or liabilities,” with the caveat that the reporting entity must have access to that market. Information at this level is based on direct observations of transactions involving the same assets and liabilities, not assumptions, and thus offers superior reliability. However, relatively few items, especially physical assets, actually trade in active markets. | |
Level 2: FASB acknowledged that active markets for identical assets and liabilities are relatively uncommon and, even when they do exist, they may be too thin to provide reliable information. To deal with this shortage of direct data, the board provided a second level of inputs that can be applied in three situations. | |
Level 3: If inputs from levels 1 and 2 are not available, FASB acknowledges that fair value measures of many assets and liabilities are less precise. The board describes Level 3 inputs as “unobservable,” and limits their use by saying they “shall be used to measure fair value to the extent that observable inputs are not available.” This category allows “for situations in which there is little, if any, market activity for the asset or liability at the measurement date”. Earlier in the standard, FASB explains that “observable inputs” are gathered from sources other than the reporting company and that they are expected to reflect assumptions made by market participants. | |
Reclassifications | ' |
Reclassifications | |
Certain reclassifications have been made to the prior quarters’ financial statements to conform to the current quarter presentation. These reclassifications had no effect on previously reported results of operations. The Company reclassified payroll and compensation to its executive from general and administrative expense to executive compensation. The company also reclassified interest payable – related party to interest payable, as the loan holder is no longer considered a related party. | |
Recent pronouncements | ' |
Recent pronouncements | |
The Company has evaluated recent accounting pronouncements through the filing date and believes that none of them will have a material effect on the Company’s financial statements. |
WEBSITE_Tables
WEBSITE (Tables) | 9 Months Ended | ||||||||
Sep. 30, 2013 | |||||||||
Notes to Financial Statements | ' | ||||||||
Website consists of the following at: | ' | ||||||||
September 30, | 31-Dec-12 | ||||||||
2013 | |||||||||
Website | $ | 43,310 | $ | 3,500 | |||||
Less: Accumulated amortization | — | — | |||||||
Website, net | $ | 43,310 | $ | 3,500 |
NOTES_PAYABLE_RELATED_PARTY_Ta
NOTES PAYABLE b RELATED PARTY (Tables) | 9 Months Ended | ||||||||
Sep. 30, 2013 | |||||||||
Notes to Financial Statements | ' | ||||||||
Notes payable consist of the following at: | ' | ||||||||
September 30, | 31-Dec-12 | ||||||||
2013 | |||||||||
Note payable to an officer, director and shareholder, unsecured, 0% interest, due upon demand | $ | 450 | $ | 450 | |||||
Note payable with a shareholder, unsecured, 0% interest, due upon demand | 1,500 | — | |||||||
Note payable with a shareholder, unsecured, 5% interest, due February 2014 | 500,000 | — | |||||||
Notes Payable – Current | $ | 501,950 | $ | 450 | |||||
Notes payable consist of the following at: | ' | ||||||||
September 30, | 31-Dec-12 | ||||||||
2013 | |||||||||
Line of credit for up to $150,000, from a shareholder, unsecured, 5% interest, due December 2013 | $ | 95,636 | $ | 17,936 | |||||
Line of credit – Current | $ | 95,636 | $ | 17,936 |
NOTES_PAYABLE_Tables
NOTES PAYABLE (Tables) | 9 Months Ended | ||||||||
Sep. 30, 2013 | |||||||||
Notes to Financial Statements | ' | ||||||||
Notes payable consist of the following | ' | ||||||||
September 30, | 31-Dec-12 | ||||||||
2013 | |||||||||
Note payable to an unrelated third party, unsecured, due May 2012, in default as of June 30, 2013 | $ | 30,250 | $ | 30,250 | |||||
Unamortized debt discount | — | — | |||||||
Notes Payable – Current | $ | 42,010 | $ | 42,010 | |||||
LONG_TERM_NOTES_PAYABLE_RELATE1
LONG TERM NOTES PAYABLE b RELATED PARTY (Tables) | 9 Months Ended | ||||||||
Sep. 30, 2013 | |||||||||
Notes to Financial Statements | ' | ||||||||
Notes payable consists of the following at | ' | ||||||||
September 30, 2013 | 31-Dec-12 | ||||||||
Note payable with a shareholder, unsecured, 5% interest, due February 2014 | $ | — | $ | 500,000 | |||||
Notes Payable – Long Term | $ | — | $ | 500,000 |
WARRANTS_Tables
WARRANTS (Tables) | 9 Months Ended | |||
Sep. 30, 2013 | ||||
Notes to Financial Statements | ' | |||
Summary of the status of all of the Company's stock warrants | ' | |||
Number | Weighted-Average | |||
of Warrants | Exercise Price | |||
Outstanding at January 1, 2013 | 20,000 | $ 15.50 | ||
Granted | - | $ 0.00 | ||
Exercised | - | $ 0.00 | ||
Expired | -20,000 | $ 15.50 | ||
Outstanding at September 30, 2013 | - | $ 0.00 | ||
Warrants exercisable at September 30, 2013 | - | $ 0.00 |
PRIOR_PERIOD_ADJUSTMENT_Tables
PRIOR PERIOD ADJUSTMENT (Tables) | 9 Months Ended | |||
Sep. 30, 2013 | ||||
Notes to Financial Statements | ' | |||
BALANCE SHEET | ' | |||
BALANCE SHEET | As Originally | Adjustments | As | |
AS OF DECEMBER 31, 2012 | Filed | Increase/(Decrease) | Restated | |
ASSETS: | ||||
Cash | $ 3,872 | $ - | $ 3,872 | |
Prepaid expenses | 100,362 | - | 100,362 | |
Prepaid stock compensation | 1,166,000 | - | 1,166,000 | |
Deferred financing cost, net | - | - | - | |
Security deposits | 1,500 | - | 1,500 | |
Trademarks | 550 | - | 550 | |
Website | 3,500 | - | 3,500 | |
TOTAL ASSETS | $ 1,275,784 | $ - | $1,275,784 | |
LIABILITIES: | ||||
Accounts payable | $ 28,941 | $ (343) | $ 28,598 | |
Accrued salaries - related party | 9,169 | - | 9,169 | |
Accrued payroll taxes | 11,891 | - | 11,891 | |
Notes payable - related party | 450 | - | 450 | |
Accrued interest payable | 621 | (400) | 221 | |
Accrued interest payable - related party | 5,153 | - | 5,153 | |
Line of credit - related party | 17,936 | - | 17,936 | |
Notes payable | 42,010 | (11,760) | 30,250 | |
Long term notes payable - related party | 500,000 | - | 500,000 | |
EQUITY: | ||||
Preferred stock | - | - | ||
Common stock | 8,153 | - | 8,153 | |
Additional paid in capital | 3,916,077 | 12,503 | 3,928,580 | |
Subscriptions payable | 7,500 | - | 7,500 | |
Deficit accumulated during development stage | (3,272,117) | (3,272,117) | ||
TOTAL LIABILITIES AND EQUITY | $ 1,275,784 | $ - | $1,275,784 | |
GOING_CONCERN_Details_Narrativ
GOING CONCERN (Details Narrative) (USD $) | 67 Months Ended |
Sep. 30, 2013 | |
Notes to Financial Statements | ' |
Iincurred accumulated net losses | ($4,974,485) |
WEBSITE_Details_Narrative
WEBSITE (Details Narrative) (USD $) | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2013 | Sep. 30, 2012 | |
Notes to Financial Statements | ' | ' | ' | ' |
Amortization expense | $0 | $0 | $0 | $0 |
NOTES_PAYABLE_RELATED_PARTY_De
NOTES PAYABLE b RELATED PARTY (Details Narrative) (USD $) | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2013 | Sep. 30, 2012 | |
Notes to Financial Statements | ' | ' | ' | ' |
Interest expense | $11,638 | $11,135 | $32,611 | $32,795 |
NOTES_PAYABLE_Details_Narrativ
NOTES PAYABLE (Details Narrative) (USD $) | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2013 | Sep. 30, 2012 | |
Notes to Financial Statements | ' | ' | ' | ' |
Interest expense | $72 | $55 | $258 | $3,044 |
LONG_TERM_NOTES_PAYABLE_RELATE2
LONG TERM NOTES PAYABLE b RELATED PARTY (Details Narrative) (USD $) | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2013 | Sep. 30, 2012 | |
Notes to Financial Statements | ' | ' | ' | ' |
Interest expense | $10,192 | $10,222 | $30,137 | $30,444 |
STOCKHOLDERS_EQUITY_Details_Na
STOCKHOLDERS' EQUITY (Details Narrative) (USD $) | Sep. 30, 2013 | Sep. 06, 2013 | Sep. 02, 2013 | Aug. 15, 2013 | Aug. 14, 2013 | Aug. 06, 2013 | Jul. 21, 2013 | Mar. 31, 2013 | Feb. 28, 2013 | 11-May-09 |
Notes to Financial Statements | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Authorized to issue shares | 10,000,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Par value preferred stock share | 0.001 | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Common stock share authorized to issue | 100,000,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Par value common stock share | 0.001 | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Par valuep | ' | ' | ' | ' | ' | ' | ' | ' | ' | 0.001 |
Par value common stock | ' | ' | ' | ' | ' | ' | ' | ' | ' | 0.001 |
Stock payable totaling | ' | ' | ' | ' | ' | ' | ' | ' | $26,250 | ' |
Shares of common stock | ' | ' | ' | ' | ' | ' | ' | ' | 15,000 | ' |
Stock payable totaling | ' | ' | ' | ' | ' | ' | ' | 9,500 | ' | ' |
Shares of common stock | ' | ' | ' | ' | ' | ' | ' | 10,000 | ' | ' |
Stock payable totaling | ' | ' | ' | ' | ' | ' | ' | 18,750 | ' | ' |
Shares of common stock | ' | ' | ' | ' | ' | ' | ' | 15,000 | ' | ' |
Common stock shares issued | ' | ' | ' | ' | ' | ' | 100,000 | ' | ' | ' |
Consulting services totaling | ' | 116,000 | ' | ' | ' | ' | 230,000 | ' | ' | ' |
Common stock shares issued | ' | ' | ' | ' | ' | 250,000 | ' | ' | ' | ' |
Consulting services totaling | ' | ' | ' | ' | ' | 500,000 | ' | ' | ' | ' |
Common stock shares issued | ' | ' | ' | ' | 250,000 | ' | ' | ' | ' | ' |
Consulting services totaling | ' | ' | ' | ' | 500,000 | ' | ' | ' | ' | ' |
Common stock shares issued | ' | ' | ' | 415,000 | ' | ' | ' | ' | ' | ' |
Consulting services totaling | ' | ' | ' | 830,000 | ' | ' | ' | ' | ' | ' |
Common stock shares | ' | ' | ' | 20,000 | ' | ' | ' | ' | ' | ' |
Common stock shares issued | ' | ' | 260,000 | ' | ' | ' | ' | ' | ' | ' |
Principal amount | ' | ' | 130,000 | ' | ' | ' | ' | ' | ' | ' |
Accrued interest | ' | ' | 542 | ' | ' | ' | ' | ' | ' | ' |
Common stock shares | ' | 50,000 | ' | ' | ' | ' | ' | ' | ' | ' |
Common stock issued shares | 250,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Common stock for cash received | 125,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Common stock issued shares | $10,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' |
AGREEMENTS_Details_Narrative
AGREEMENTS (Details Narrative) (USD $) | 3 Months Ended | 9 Months Ended | ||||
Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2013 | Sep. 30, 2012 | Mar. 01, 2013 | Jan. 03, 2013 | |
Notes to Financial Statements | ' | ' | ' | ' | ' | ' |
Lease term | ' | ' | ' | ' | ' | $3,500 |
Paid a refundable security deposit | ' | ' | ' | ' | ' | 1,500 |
Rent expense | 10,500 | 10,500 | 31,500 | 31,500 | ' | ' |
Annual compensation | ' | ' | ' | ' | 12,000 | ' |
Common stock shares issued | ' | ' | ' | ' | 15,000 | ' |
Compensation expense | $24,750 | $31,350 | $75,750 | $116,850 | ' | ' |
SUBSEQUENT_EVENTS_Details_Narr
SUBSEQUENT EVENTS (Details Narrative) (USD $) | Oct. 31, 2013 |
Subsequent Events [Abstract] | ' |
Sold shares | $140,000 |
Common stock for cash | $70,000 |
PREPAID_STOCK_COMPENSATION_Det
PREPAID STOCK COMPENSATION (Details Narrative) (USD $) | 9 Months Ended | ||
Sep. 30, 2013 | Dec. 31, 2012 | Nov. 30, 2012 | |
Notes to Financial Statements | ' | ' | ' |
Shares of common stock | 1,065,000 | ' | 500,000 |
Consulting agreements totaling | $2,176,000 | ' | $1,325,000 |
Company expensed | 993,750 | ' | ' |
Prepaid expense amount totaling | 172,250 | ' | ' |
Expense amount balance | ' | 1,166,000 | ' |
Company expensed | 269,579 | ' | ' |
prepaid expense amount totaling | 1,906,421 | ' | ' |
Balance | ' | $0 | ' |