Document_and_Entity_Informatio
Document and Entity Information | 9 Months Ended | |
Sep. 30, 2014 | Nov. 13, 2014 | |
Document and Entity Information: | ' | ' |
Entity Registrant Name | 'RVUE HOLDINGS, INC. | ' |
Document Type | '10-Q | ' |
Document Period End Date | 30-Sep-14 | ' |
Amendment Flag | 'false | ' |
Entity Central Index Key | '0001455206 | ' |
Current Fiscal Year End Date | '--12-31 | ' |
Entity Common Stock, Shares Outstanding | ' | 140,222,189 |
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 | 'Q3 | ' |
CONDENSED_CONSOLIDATED_BALANCE
CONDENSED CONSOLIDATED BALANCE SHEETS (USD $) | Sep. 30, 2014 | Dec. 31, 2013 |
Current assets: | ' | ' |
Cash and cash equivalents | $470,170 | $844,589 |
Accounts receivable | 200,414 | 124,993 |
Prepaid expenses | 18,936 | 10,856 |
Total current assets | 689,520 | 980,438 |
Property and equipment, net | 1,238 | 3,065 |
Software development costs | 136,578 | 80,600 |
Deposits | 3,180 | 10,680 |
Total Assets | 830,516 | 1,074,783 |
Current liabilities: | ' | ' |
Accounts payable | 137,363 | 132,121 |
Accrued expenses | 155,715 | 113,384 |
Subscription investment payable | 0 | 25,000 |
Deferred revenue | 10,500 | 0 |
Total current liabilities | 303,578 | 270,505 |
Commitments and contingencies (Note 9) | ' | ' |
Stockholders' equity: | ' | ' |
Preferred stock, $0.001 par value per share; 10,000,000 shares authorized; none issued or outstanding | 0 | 0 |
Common stock, $0.001 par value per share; 240,000,000 shares authorized at September 30, 2014 and December 31,2013;140,222,189 issued and outstanding at September 30, 2014 and 132,221,476 at December 31, 2013 | 140,222 | 132,222 |
Additional paid-in capital | 13,019,563 | 12,418,899 |
Accumulated deficit | -12,632,847 | -11,746,843 |
Total stockholders' equity | 526,938 | 804,278 |
Total Liabilities and Stockholders' Equity | $830,516 | $1,074,783 |
CONDENSED_CONSOLIDATED_BALANCE1
CONDENSED CONSOLIDATED BALANCE SHEETS PARANTHETICALS (USD $) | Sep. 30, 2014 | Dec. 31, 2013 |
Parentheticals | ' | ' |
Preferred Stock, par value | $0.00 | $0.00 |
Preferred Stock, shares authorized | 10,000,000 | 10,000,000 |
Common Stock, par value | $0.00 | $0.00 |
Common Stock, shares authorized | 240,000,000 | 240,000,000 |
Common Stock, shares issued | 140,222,189 | 132,221,476 |
Common Stock, shares outstanding | 140,222,189 | 132,221,476 |
CONDENSED_CONSOLIDATED_STATEME
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (unaudited) (USD $) | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2014 | Sep. 30, 2013 | Sep. 30, 2014 | Sep. 30, 2013 | |
Revenue | ' | ' | ' | ' |
Core fees | $248,940 | $111,268 | $641,112 | $357,597 |
Non-core fees | 31,500 | 35,925 | 98,925 | 130,075 |
Total revenues | 280,440 | 147,193 | 740,037 | 487,672 |
Costs and expenses | ' | ' | ' | ' |
Cost of revenue | 219,392 | 77,266 | 564,229 | 262,792 |
Selling, general and administrative expenses | 323,507 | 332,337 | 1,002,514 | 2,057,050 |
Depreciation and amortization | 27,604 | 6,332 | 59,298 | 29,879 |
Interest income | 0 | -21 | 0 | -335 |
Total Costs and Operating Expenses | 570,503 | 415,914 | 1,626,041 | 2,349,386 |
Loss before provision for income taxes | -290,063 | -268,721 | -886,004 | -1,861,714 |
Provision for income taxes | 0 | 0 | 0 | 0 |
Net loss | ($290,063) | ($268,721) | ($886,004) | ($1,861,714) |
Net loss per common share - basic and diluted | $0 | $0 | ($0.01) | ($0.02) |
Shares used in computing net loss per share: Basic and diluted | 139,200,211 | 116,675,425 | 136,691,309 | 113,715,618 |
CONDENSED_CONSOLIDATED_STATEME1
CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY (USD $) | Preferred Stock Shares | Preferred Stock Amount | Common Stock Shares | Common Stock Amount | Additional Paid-In Capital | Accumulated Deficit | Total |
USD ($) | USD ($) | USD ($) | USD ($) | USD ($) | |||
Balance at Dec. 31, 2013 | 0 | 0 | 132,221,476 | 132,222 | 12,418,899 | -11,746,843 | 804,278 |
Common stock issued for compensation and services | 0 | 0 | 715,000 | 715 | 52,685 | 0 | 53,400 |
Common stock issued | 0 | 0 | 7,285,713 | 7,285 | 502,715 | 0 | 510,000 |
Stock based compensation expense | ' | $0 | ' | $0 | $45,264 | $0 | $45,264 |
Net Loss | ' | $0 | ' | $0 | $0 | ($886,004) | ($886,004) |
Balance at Sep. 30, 2014 | 0 | 0 | 140,222,189 | 140,222 | 13,019,563 | -12,632,847 | 526,938 |
CONDENSED_CONSOLIDATED_STATEME2
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (unaudited) (USD $) | 9 Months Ended | |
Sep. 30, 2014 | Sep. 30, 2013 | |
Operating activities | ' | ' |
Net loss | ($886,004) | ($1,861,714) |
Adjustments to reconcile net loss to net cash used in operating activities: | ' | ' |
Depreciation and amortization | 59,298 | 29,879 |
Stock-based compensation expense | 45,264 | 754,723 |
Common stock issued for services | 0 | 118,333 |
Changes in operating assets and liabilities: | ' | ' |
Accounts receivable | -75,421 | 11,491 |
Prepaid expenses | -8,080 | 35,962 |
Accounts payable | 47,242 | -52,699 |
Accrued expenses | 53,731 | -72,585 |
Deferred revenue | 10,500 | 0 |
Cash used in operating activities | -753,470 | -1,036,610 |
Investing activities | ' | ' |
Payments for property, equipment and software development | -113,449 | -59,402 |
Change in deposits | 7,500 | 11,310 |
Cash used in investing activities | -105,949 | -48,092 |
Financing activities | ' | ' |
Proceeds from the issuance of common stock | 485,000 | 316,500 |
Cash provided by financing activities | 485,000 | 316,500 |
Decrease in cash and cash equivalents | -374,419 | -768,202 |
Cash and cash equivalents, beginning of period | 844,589 | 848,174 |
Cash and cash equivalents, end of period | $470,170 | $79,972 |
Summary_of_Significant_Account
Summary of Significant Accounting Policies | 9 Months Ended |
Sep. 30, 2014 | |
Summary of Significant Accounting Policies | ' |
Summary of Significant Accounting Policies | ' |
Note 1 – Summary of Significant Accounting Policies | |
rVue Holdings, Inc., formerly known as Rivulet International, Inc. (“We”, “us” or the “Company”), was incorporated in the State of Nevada on November 12, 2008. We are an advertising technology company that has developed and operates an integrated advertising exchange and digital distribution platform – rVue – for the Digital Out-of-Home (“DOOH”) industry. | |
Basis of Presentation and Preparation | |
The accompanying unaudited condensed consolidated financial statements include the accounts of the Company and our wholly owned subsidiaries. Intercompany accounts and transactions have been eliminated. The preparation of these condensed consolidated financial statements in conformity with U.S. generally accepted accounting principles (“GAAP”) requires us to make estimates and assumptions that affect the amounts reported and disclosed in the condensed consolidated financial statements and the accompanying notes. Actual results could differ materially from these estimates. On an ongoing basis, we evaluate our estimates, including those related to accounts receivable, fair values of financial instruments, useful lives of capitalized software development costs and property and equipment, fair values of stock-based awards, income taxes, and contingent liabilities, among others. We base our estimates on historical experience and on various other assumptions that are believed to be reasonable, the results of which form the basis for making judgments about the carrying values of assets and liabilities. In the opinion of the Company’s management, all adjustments (including normal recurring adjustments) considered necessary to present fairly the unaudited condensed consolidated financial statements have been made. | |
The year-end condensed balance sheet data was derived from audited financial statements, but does not include all disclosures required by GAAP. These condensed consolidated financial statements and accompanying notes should be read in conjunction with the Company’s annual consolidated financial statements and the notes thereto for the year ended December 31, 2013, included in our Annual Report on Form 10-K (the “2013 Form 10-K”). | |
The unaudited condensed consolidated statement of operations for the three and nine months ended September 30, 2014 are not necessarily indicative of the results that may be expected for the entire year. |
Going_Concern
Going Concern | 9 Months Ended |
Sep. 30, 2014 | |
Going Concern | ' |
Going Concern | ' |
Note 2 – Going Concern | |
The accompanying condensed consolidated financial statements have been prepared on a going concern basis, which contemplates the realization of assets and the satisfaction of liabilities in the normal course of business. We have sustained losses and experienced negative cash flows from operations since inception, and have an accumulated deficit of $12,632,847 at September 30, 2014. These factors raise substantial doubt about our ability to continue to operate in the normal course of business. We have funded our activities to date almost exclusively from equity and debt financings. | |
At December 31, 2013 our registered independent public accounting firm expressed substantial doubt as to our ability to continue as a going concern because, since inception, we have incurred substantial losses and negative cash flows from operations. We intend to address this concern by focusing on revenue growth in the coming months and raising capital through the issuance of Common Stock to investors. | |
We have raised $510,000 thus far in 2014 through the issuance of Common Stock to investors. We plan on issuing additional shares during the fourth quarter of 2014 and the first quarter of 2015. We believe the capital raised to date along with the capital to be raised in the fourth quarter of 2014 and the first quarter on 2015 and continued operational growth will provide a sufficient amount of cash to continue through 2015. However, no assurance can be given that such expectations will materialize or on what terms. |
Loss_Per_Common_Share
Loss Per Common Share | 9 Months Ended | ||||||||||||
Sep. 30, 2014 | |||||||||||||
Loss Per Common Share | ' | ||||||||||||
Loss Per Common Share | ' | ||||||||||||
Note 3 – Loss Per Common Share | |||||||||||||
Basic and diluted loss per common share is computed by dividing the loss by the weighted average number of common shares outstanding for the period. Since the Company incurred losses attributable to common stockholders during the three and nine months ended September 30, 2014 and 2013, diluted loss per common share has not been computed by giving effect to all potentially dilutive common shares that were outstanding during the three and nine months ended September 30, 2014 and 2013 since this would have an anti-dilutive effect. | |||||||||||||
The following table sets forth the computation of basic and diluted loss per common share: | |||||||||||||
Three Months Ended | Nine Months Ended | ||||||||||||
September 30, | September 30, | ||||||||||||
2014 | 2013 | 2014 | 2013 | ||||||||||
Numerator: | |||||||||||||
Net loss | $ | -290,063 | $ | -268,721 | $ | -886,004 | $ | -1,861,714 | |||||
Denominator: | |||||||||||||
Weighted-average shares outstanding | 139,200,211 | 116,675,425 | 136,691,309 | 113,715,618 | |||||||||
Effect of dilutive securities(1) | - | - | - | - | |||||||||
Weighted-average diluted shares | 139,200,211 | 116,675,425 | 136,691,309 | 113,715,618 | |||||||||
Basic and diluted loss per share | $ | 0 | $ | 0 | $ | -0.01 | $ | -0.02 | |||||
-1 | |||||||||||||
The following stock options, warrants and convertible notes outstanding as of September 30, 2014 and 2013 were not included in the computation of dilutive loss per share because the net effect would have been anti-dilutive: | |||||||||||||
September 30, | |||||||||||||
2014 | 2013 | ||||||||||||
Stock options | - | - | |||||||||||
Warrants | 73,138 | - | |||||||||||
73,138 | - |
Financial_Instruments
Financial Instruments | 9 Months Ended |
Sep. 30, 2014 | |
Financial Instruments | ' |
Financial Instruments | ' |
Note 4 – Financial Instruments | |
Accounts Receivable | |
We sell our services directly to our customers. Accounts receivable from three of our customers accounted for 93.2% of total accounts receivable at September 30, 2014, and accounts receivable from three of our customers accounted for 80.9% of total accounts receivable at December 31, 2013. We had no allowance for doubtful accounts at either September 30, 2014 or December 31, 2013. |
Fair_Value_Measurements
Fair Value Measurements | 9 Months Ended |
Sep. 30, 2014 | |
Fair Value Measurements | ' |
Fair Value Measurements | ' |
Note 5 – Fair Value Measurements | |
Fair value is the price that would be received upon sale of an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. The following fair value hierarchy is used in selecting inputs, with the highest priority given to Level 1, as these are the most transparent or reliable: | |
Level 1 – Quoted prices for identical instruments in active markets. | |
Level 2 – Quoted prices for similar instruments in active markets; quoted prices for identical or similar instruments in markets that are not active; and model-derived valuations in which all significant inputs are observable directly or indirectly. | |
Level 3 – Valuations derived from valuation techniques in which one or more significant inputs are unobservable. | |
We are responsible for the valuation process and as part of this process we used data from an outside source to establish fair value. We performed due diligence to understand the inputs used or how the data was calculated or derived, and we corroborated the reasonableness of external inputs in the valuation process. |
Condensed_Consolidated_Financi
Condensed Consolidated Financial Statement Details | 9 Months Ended | ||||||||
Sep. 30, 2014 | |||||||||
Condensed Consolidated Financial Statement Details | ' | ||||||||
Condensed Consolidated Financial Statement Details | ' | ||||||||
Note 6 – Condensed Consolidated Financial Statement Details | |||||||||
The following tables show the Company’s condensed consolidated financial statement details as of September 30, 2014 and December 31, 2013: | |||||||||
Prepaid expenses | 30-Sep-14 | 31-Dec-13 | |||||||
Insurance | $ | 15,706 | $ | 8,510 | |||||
Other | 3,230 | 2,346 | |||||||
$ | 18,936 | $ | 10,856 | ||||||
Estimated Useful Lives | September 30, | December 31, | |||||||
Property and Equipment | (Years) | 2014 | 2013 | ||||||
Computers and software | 5-Feb | $ | 91,083 | $ | 91,083 | ||||
Furniture and equipment | 3 | 22,977 | 22,977 | ||||||
Gross property and equipment | 114,060 | 114,060 | |||||||
Less accumulated depreciation | -112,822 | -110,995 | |||||||
Net property and equipment | $ | 1,238 | $ | 3,065 | |||||
Depreciation expense was $1,827 and $9,247 for the nine months ended September 30, 2014 and 2013, respectively. Depreciation expense was $576 and $1,419 for the three months ended September 30, 2014 and 2013, respectively. | |||||||||
Estimated Useful Lives | September 30, | December 31, | |||||||
Software Development Costs | (Months) | 2014 | 2013 | ||||||
Software development costs | 18 | $ | 1,262,162 | $ | 1,148,713 | ||||
Less accumulated amortization | -1,125,584 | -1,068,113 | |||||||
Net software development costs | $ | 136,578 | $ | 80,600 | |||||
Amortization expense was $57,471 and $20,632 for the nine months ended September 30, 2014 and 2013, respectively. Amortization expense was $27,028 and $4,913 for the three months ended September 30, 2014 and 2013, respectively. | |||||||||
Accrued Expenses | 30-Sep-14 | 31-Dec-13 | |||||||
Personnel costs | $ | 13,195 | $ | 18,966 | |||||
Professional fees | - | 39,000 | |||||||
Network costs | 125,020 | 37,918 | |||||||
Other | 17,500 | 17,500 | |||||||
$ | 155,715 | $ | 113,384 |
Income_Taxes
Income Taxes | 9 Months Ended |
Sep. 30, 2014 | |
Income Taxes | ' |
Income Taxes | ' |
Note 7 – Income Taxes | |
There is no income tax benefit for the losses for the nine-month periods ended September 30, 2014 and 2013, since management has determined that the realization of the net deferred tax asset is not more likely than not to be realized and has created a valuation allowance for the entire amount of such benefit. | |
Our policy is to record interest and penalties associated with unrecognized tax benefits as additional income taxes in the condensed consolidated statement of operations. At December 31, 2013, we had no unrecognized tax benefits, or any tax related interest or penalties. There were no changes in unrecognized tax benefits during the period ended September 30, 2014. We did not recognize any interest or penalties during 2013 related to unrecognized tax benefits, or through the period ended September 30, 2014. |
Stockholders_Equity_and_Stock_
Stockholders' Equity and Stock Based Compensation | 9 Months Ended | |||||||||||
Sep. 30, 2014 | ||||||||||||
Stockholders' Equity and Stock Based Compensation | ' | |||||||||||
Stockholders' Equity and Stock Based Compensation | ' | |||||||||||
Note 8 – Stockholders’ Equity and Stock Based Compensation | ||||||||||||
Equity Awards | ||||||||||||
Stock Option Activity | ||||||||||||
A summary of the Company’s stock option activity for the nine-month period ended September 30, 2014 is as follows: | ||||||||||||
Number of Options | Weighted Average Exercise Price Per Share | Weighted Average Remaining Contractual Term | Aggregate Intrinsic Value | |||||||||
Balance at December 31, 2013 | 2,640,000 | $ | 0.17 | 8.41 | $ | - | ||||||
Options granted | - | $ | - | $ | ||||||||
Options exercised | - | $ | - | $ | ||||||||
Options forfeited | -300,000 | $ | 0.25 | - | $ | - | ||||||
Balance at September 30, 2014 | 2,340,000 | $ | 0.16 | 7.81 | $ | - | ||||||
Exercisable at September 30, 2014 | 1,226,669 | $ | 0.2 | 6.71 | $ | - | ||||||
Expected to vest after September 30, 2014 | 1,113,331 | $ | 0.12 | 9.01 | $ | - | ||||||
Aggregate intrinsic value represents the value of the Company’s closing stock price on the last trading day of the fiscal period in excess of the weighted-average exercise price multiplied by the number of options outstanding or exercisable. The aggregate intrinsic value excludes the effect of stock options that have a zero or negative intrinsic value. | ||||||||||||
Stock-Based Compensation | ||||||||||||
Stock-based compensation cost for stock options is estimated at the grant date based on the fair-value as calculated by the Black-Scholes Merton (“BSM”) option-pricing model. The BSM option-pricing model incorporates various assumptions including expected volatility, expected life and interest rates. The Company’s computation of expected life is determined based on the simplified method as the Company does not have sufficient historical exercise data to provide a reasonable basis upon which to estimate the expected term due to the limited period of time its equity shares have been publicly traded. The interest rate is based on the U.S. Treasury Yield curve in effect at the time of grant. The Company’s computation of expected volatility is based on comparable companies’ average historical volatility. The Company does not expect to pay dividends. While the Company believes these estimates are reasonable, the estimated compensation expense would increase if the expected life was increased or a higher expected volatility was used. The Company recognizes stock-based compensation cost as expense on a straight-line basis over the requisite service period. | ||||||||||||
We did not grant any options during the nine-month period ended September 30, 2014 or during the nine-month period ended September 30, 2013. | ||||||||||||
Stock based compensation expense was $15,088 and $6,723 for the three months ended September 30, 2014 and 2013, respectively. Stock based compensation expense was $45,264 and $754,723 for the nine months ended September 30, 2014 and 2013, respectively. | ||||||||||||
On March 29, 2013, the Board approved payment of 4.4 million shares to Michael Mullarkey, a director at the time, as compensation for serving as Acting CEO and Acting CFO after the prior CEO and CFO both left the Company in 2012. Mr. Mullarkey held those temporary positions until April 11, 2013, when a CEO and Acting CFO was appointed. Mr. Mullarkey resigned from the Company’s board of directors effective May 31, 2013. The share award was contingent upon the accomplishment of certain objectives set by the board of directors. The accomplishment of the objectives was determined in the first quarter of 2013, and the resulting expense of $748,000 was recorded during the three months ended March 31, 2013. | ||||||||||||
The Company issued an aggregate of 1,066,667 shares to officers and directors in lieu of cash compensation resulting in additional director fee expense of $78,333 during the nine months ended September 30, 2013. In addition, the Company issued an aggregate of 1,220,000 shares to consultants for services performed resulting in additional consulting fees of $73,000 during the nine months ended September 30, 2013. | ||||||||||||
The Company entered into an employment agreement with Mark Pacchini, our CEO and acting CFO, on July 1, 2013. The agreement term is three years and includes mandatory bonuses payable in the Company’s common stock if specific revenue goals are achieved in a twelve month period. On January 1, 2014, the revenue goals for this employment agreement were amended. As of September 30, 2014 it did not appear probable that any of the required goals in the agreement will be achieved. As a result, there was no stock based compensation expense recognized related to this agreement. The Company will reassess the probability of the Company achieving the revenue goals included in the agreement on a quarterly basis. |
Commitments_and_Contingencies
Commitments and Contingencies | 9 Months Ended |
Sep. 30, 2014 | |
Commitments and Contingencies {1} | ' |
Commitments and Contingencies | ' |
Note 9 – Commitments and Contingencies | |
Other Off-Balance Sheet Commitments | |
We leased our Fort Lauderdale, Florida office space for our corporate headquarters and technology group under a non-cancelable operating lease which expired June 30, 2013. On July 1, 2013 we moved to a smaller space in Fort Lauderdale - approximately 600 square feet – which we leased at a rate of approximately $2,200 a month. On November 1, 2013 we moved to a smaller space – approximately 140 square feet within the same facility – which we lease at a rate of approximately $1,300 a month. We closed our Fort Lauderdale office in the third quarter of 2014. | |
On October 4, 2013 we moved our corporate headquarters to Elmhurst, Illinois, where we lease approximately 2,700 square feet of office space from Real Capital, LLC under a lease contract that expires on September 30, 2015. Lease payments are approximately $3,100 a month through September 30, 2014 increasing to $3,193 a month through September 30, 2015. This facility accommodates our principal sales, marketing, operations, finance and administrative activities. | |
Contingencies | |
We are subject to certain legal proceedings that have not been adjudicated, which are discussed in Part II, Item 1 of this Form 10-Q under the heading “Legal Proceedings”. In the opinion of management, the Company does not have probable liability related to these legal proceedings that would materially adversely affect our financial condition or operating results. However, the results of legal proceedings cannot be predicted with certainty. If we fail to prevail in any of these legal matters, the operating results of a particular reporting period could be materially adversely affected. |
Related_Party_Transactions_and
Related Party Transactions and Certain Other Transactions | 9 Months Ended |
Sep. 30, 2014 | |
Related Party Transactions and Certain Other Transactions | ' |
Related Party Transactions and Certain Other Transactions | ' |
Note 10 - Related Party Transactions and Certain Other Transactions | |
During the three months ended September 30, 2014, the Company had sales of $9,907 to a customer that the Company's chief executive officer is a board member. At September 30, 2014, accounts receivable related to this customer totaled $9,907. |
Supplemental_NonCash_Informati
Supplemental Non-Cash Information | 9 Months Ended |
Sep. 30, 2014 | |
Supplemental Non-Cash Information | ' |
Supplemental Non-Cash Information | ' |
Note 11 – Supplemental Non-Cash Information | |
During the nine months ended September 30, 2014, the Company issued common stock totaling $42,000 to Ken Dvorak for accounting services performed in 2013 and issued common stock totaling $11,400 in the settlement of a law suit. | |
During the nine months ended September 30, 2013, the Company issued 700,000 shares of common stock and 450,000 warrants to purchase common stock for fees associated with the equity raised in 2013. Also, the Company issued 500,000 shares of common stock to the former CEO of the Company for consulting services he performed subsequent to leaving the Company. Additionally, in 2013, the Company reversed the accrued director fees balance of $81,667 upon the issuance of shares to officers and directors in lieu of accrued cash compensation. |
SIGNIFICANT_ACCOUNTING_POLICIE
SIGNIFICANT ACCOUNTING POLICIES (Policies) | 9 Months Ended |
Sep. 30, 2014 | |
SIGNIFICANT ACCOUNTING POLICIES | ' |
Basis of Presentation and Preparation | ' |
Basis of Presentation and Preparation | |
The accompanying unaudited condensed consolidated financial statements include the accounts of the Company and our wholly owned subsidiaries. Intercompany accounts and transactions have been eliminated. The preparation of these condensed consolidated financial statements in conformity with U.S. generally accepted accounting principles (“GAAP”) requires us to make estimates and assumptions that affect the amounts reported and disclosed in the condensed consolidated financial statements and the accompanying notes. Actual results could differ materially from these estimates. On an ongoing basis, we evaluate our estimates, including those related to accounts receivable, fair values of financial instruments, useful lives of capitalized software development costs and property and equipment, fair values of stock-based awards, income taxes, and contingent liabilities, among others. We base our estimates on historical experience and on various other assumptions that are believed to be reasonable, the results of which form the basis for making judgments about the carrying values of assets and liabilities. In the opinion of the Company’s management, all adjustments (including normal recurring adjustments) considered necessary to present fairly the unaudited condensed consolidated financial statements have been made. | |
The year-end condensed balance sheet data was derived from audited financial statements, but does not include all disclosures required by GAAP. These condensed consolidated financial statements and accompanying notes should be read in conjunction with the Company’s annual consolidated financial statements and the notes thereto for the year ended December 31, 2013, included in our Annual Report on Form 10-K (the “2013 Form 10-K”). | |
The unaudited condensed consolidated statement of operations for the three and nine months ended September 30, 2014 are not necessarily indicative of the results that may be expected for the entire year. |
LOSS_PER_COMMON_SHARE_Tables
LOSS PER COMMON SHARE (Tables) | 9 Months Ended | ||||||||||||
Sep. 30, 2014 | |||||||||||||
BASIC AND DILUTED LOSS PER COMMON SHARE | ' | ||||||||||||
Schedule of Earnings Per Share, Basic and Diluted | ' | ||||||||||||
The following table sets forth the computation of basic and diluted loss per common share: | |||||||||||||
Three Months Ended | Nine Months Ended | ||||||||||||
September 30, | September 30, | ||||||||||||
2014 | 2013 | 2014 | 2013 | ||||||||||
Numerator: | |||||||||||||
Net loss | $ | -290,063 | $ | -268,721 | $ | -886,004 | $ | -1,861,714 | |||||
Denominator: | |||||||||||||
Weighted-average shares outstanding | 139,200,211 | 116,675,425 | 136,691,309 | 113,715,618 | |||||||||
Effect of dilutive securities(1) | - | - | - | - | |||||||||
Weighted-average diluted shares | 139,200,211 | 116,675,425 | 136,691,309 | 113,715,618 | |||||||||
Basic and diluted loss per share | $ | 0 | $ | 0 | $ | -0.01 | $ | -0.02 | |||||
Schedule of Antidilutive Securities Excluded from Computation of Earnings Per Share | ' | ||||||||||||
The following stock options, warrants and convertible notes outstanding as of September 30, 2014 and 2013 were not included in the computation of dilutive loss per share because the net effect would have been anti-dilutive: | |||||||||||||
September 30, | |||||||||||||
2014 | 2013 | ||||||||||||
Stock options | - | - | |||||||||||
Warrants | 73,138 | - | |||||||||||
73,138 | - |
Recovered_Sheet1
CONDENSED CONSOLIDATED FINANCIAL STATEMENT DETAILS (Tables) | 9 Months Ended | ||||||||
Sep. 30, 2014 | |||||||||
CONDENSED CONSOLIDATED FINANCIAL STATEMENT DETAILS Text Block: | ' | ||||||||
Schedule of Condensed Financial Statements | ' | ||||||||
The following tables show the Company’s condensed consolidated financial statement details as of September 30, 2014 and December 31, 2013: | |||||||||
Prepaid expenses | 30-Sep-14 | 31-Dec-13 | |||||||
Insurance | $ | 15,706 | $ | 8,510 | |||||
Other | 3,230 | 2,346 | |||||||
$ | 18,936 | $ | 10,856 | ||||||
Estimated Useful Lives | September 30, | December 31, | |||||||
Property and Equipment | (Years) | 2014 | 2013 | ||||||
Computers and software | 5-Feb | $ | 91,083 | $ | 91,083 | ||||
Furniture and equipment | 3 | 22,977 | 22,977 | ||||||
Gross property and equipment | 114,060 | 114,060 | |||||||
Less accumulated depreciation | -112,822 | -110,995 | |||||||
Net property and equipment | $ | 1,238 | $ | 3,065 | |||||
Schedule of Depreciation expense | ' | ||||||||
Depreciation expense was $1,827 and $9,247 for the nine months ended September 30, 2014 and 2013, respectively. Depreciation expense was $576 and $1,419 for the three months ended September 30, 2014 and 2013, respectively. | |||||||||
Estimated Useful Lives | September 30, | December 31, | |||||||
Software Development Costs | (Months) | 2014 | 2013 | ||||||
Software development costs | 18 | $ | 1,262,162 | $ | 1,148,713 | ||||
Less accumulated amortization | -1,125,584 | -1,068,113 | |||||||
Net software development costs | $ | 136,578 | $ | 80,600 | |||||
Schedule of Amortization expenses | ' | ||||||||
Accrued Expenses | 30-Sep-14 | 31-Dec-13 | |||||||
Personnel costs | $ | 13,195 | $ | 18,966 | |||||
Professional fees | - | 39,000 | |||||||
Network costs | 125,020 | 37,918 | |||||||
Other | 17,500 | 17,500 | |||||||
$ | 155,715 | $ | 113,384 |
Summary_of_stock_option_Tables
Summary of stock option (Tables) | 9 Months Ended | |||||||||||
Sep. 30, 2014 | ||||||||||||
Summary of stock option (Tables) | ' | |||||||||||
Summary of stock option (Tables) | ' | |||||||||||
A summary of the Company’s stock option activity for the nine-month period ended September 30, 2014 is as follows: | ||||||||||||
Number of Options | Weighted Average Exercise Price Per Share | Weighted Average Remaining Contractual Term | Aggregate Intrinsic Value | |||||||||
Balance at December 31, 2013 | 2,640,000 | $ | 0.17 | 8.41 | $ | - | ||||||
Options granted | - | $ | - | $ | ||||||||
Options exercised | - | $ | - | $ | ||||||||
Options forfeited | -300,000 | $ | 0.25 | - | $ | - | ||||||
Balance at September 30, 2014 | 2,340,000 | $ | 0.16 | 7.81 | $ | - | ||||||
Exercisable at September 30, 2014 | 1,226,669 | $ | 0.2 | 6.71 | $ | - | ||||||
Expected to vest after September 30, 2014 | 1,113,331 | $ | 0.12 | 9.01 | $ | - |
GOING_CONCERN_Details
GOING CONCERN (Details) (USD $) | Sep. 30, 2014 |
GOING CONCERN DETAILS | ' |
Accumulated deficit | ($12,632,847) |
Issuance of Common Stock to investors | $510,000 |
LOSS_PER_COMMON_SHARE_Details
LOSS PER COMMON SHARE (Details) (USD $) | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2014 | Sep. 30, 2013 | Sep. 30, 2014 | Sep. 30, 2013 | |
Numerator: | ' | ' | ' | ' |
Net loss | ($290,063) | ($268,721) | ($886,004) | ($1,861,714) |
Denominator: | ' | ' | ' | ' |
Weighted-average shares outstanding | 139,200,211 | 116,675,425 | 136,691,309 | 113,715,618 |
Effect of dilutive securities (1) | ' | ' | ' | ' |
Weighted-average diluted shares | 139,200,211 | 116,675,425 | 136,691,309 | 113,715,618 |
Basic and diluted loss per share | $0 | $0 | ($0.01) | ($0.02) |
Stock_options_warrants_and_con
Stock options, warrants and convertible notes outstanding (Details) | 3 Months Ended | |
Sep. 30, 2014 | Sep. 30, 2013 | |
Stock options, warrants and convertible notes outstanding | ' | ' |
Stock options | 0 | 0 |
Warrants | 73,138 | 0 |
convertible notes | 73,138 | 0 |
FINANCIAL_INSTRUMENTS_Details
FINANCIAL INSTRUMENTS (Details) | Sep. 30, 2014 |
Accounts Receivable: | ' |
Accounts receivable from one customer accounted for (percent) | 93.20% |
Accounts receivable from three customer accounted for (percent) | 80.90% |
Recovered_Sheet2
Condensed consolidated financial statement details (Details) (USD $) | Sep. 30, 2014 | Dec. 31, 2013 |
Prepaid expenses: | ' | ' |
Insurance | $15,706 | $8,510 |
Other | 3,230 | 2,346 |
Prepaid expenses | 18,936 | 10,856 |
Property and Equipment: | ' | ' |
Computers and software | 91,083 | 91,083 |
Furniture and equipment | 22,977 | 22,977 |
Gross property and equipment | 114,060 | 114,060 |
Less accumulated depreciation | -112,822 | -110,995 |
Property and equipment, net | $1,238 | $3,065 |
Property_and_Equipment_estimat
Property and Equipment estimated useful life (Years) (Details) | 3 Months Ended |
Sep. 30, 2014 | |
Property and Equipment estimated useful life: | ' |
Computers and software estimated useful life (Years) | '2 - 5 years |
Furniture and equipment estimated useful life (Years) | '3 years |
Depreciation_expense_Details
Depreciation expense (Details) (USD $) | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2014 | Sep. 30, 2013 | Sep. 30, 2014 | Sep. 30, 2013 | |
Depreciation expense during the period: | ' | ' | ' | ' |
Depreciation expense | $576 | $1,419 | $1,827 | $9,247 |
Software_Development_Costs_Det
Software Development Costs (Details) (USD $) | Sep. 30, 2014 | Dec. 31, 2013 |
Software Development Costs: | ' | ' |
Software development costs Gross | $1,262,162 | $1,148,713 |
Less accumulated amortization | -1,125,584 | -1,068,113 |
Software development costs | $136,578 | $80,600 |
Amortization_expense_Details
Amortization expense (Details) (USD $) | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2014 | Sep. 30, 2013 | Sep. 30, 2014 | Sep. 30, 2013 | |
Amortization expense: | ' | ' | ' | ' |
Amortization expense | $27,028 | $4,913 | $57,471 | $20,632 |
Accrued_Expenses_Details
Accrued Expenses (Details) (USD $) | Sep. 30, 2014 | Dec. 31, 2013 |
Accrued Expenses: | ' | ' |
Personnel costs | $13,195 | $18,966 |
Professional fees | 0 | 39,000 |
Network costs | 125,020 | 37,918 |
Other | 17,500 | 17,500 |
Accrued expenses | $155,715 | $113,384 |
Summary_of_stock_option_activi
Summary of stock option activity (Details) (USD $) | Number of Options | Weighted Average Exercise Price Per Share | Weighted Average Remaining contractual Term | Aggregate Intrinsic Value |
Balance. at Dec. 31, 2013 | 2,640,000 | 0.17 | 8.41 | 0 |
Options granted | $0 | $0 | $0 | $0 |
Options exercised | 0 | 0 | 0 | 0 |
Options forfeited | ($300,000) | $0.25 | $0 | $0 |
Expected to vest after September 30, 2014 | 1,113,331 | 0.12 | 9.01 | 0 |
Exercisable at Sep. 30, 2014 | 1,226,669 | 0.2 | 6.71 | 0 |
Balance. at Sep. 30, 2014 | 2,340,000 | 0.16 | 7.81 | 0 |
Stockbased_compensation_Detail
Stock-based compensation (Details) (USD $) | 3 Months Ended | 9 Months Ended | ||||
Sep. 30, 2014 | Sep. 30, 2013 | Mar. 31, 2013 | Sep. 30, 2014 | Sep. 30, 2013 | Mar. 29, 2013 | |
Stock-Based Compensation: | ' | ' | ' | ' | ' | ' |
Stock-based compensation expense | $15,088 | $6,723 | ' | $45,264 | $754,723 | ' |
Payment of compensation to a Director for serving | ' | ' | ' | ' | ' | 4,400,000 |
Accomplishment of the objectives resulting expense | ' | ' | 748,000 | ' | ' | ' |
Issued an aggregate shares to officers and directors | ' | ' | ' | 1,066,667 | 1,220,000 | ' |
Additional director fee expense | ' | ' | ' | $78,333 | $73,000 | ' |
COMMITMENTS_AND_CONTINGENCIES_
COMMITMENTS AND CONTINGENCIES (Details) (USD $) | Sep. 30, 2014 | Nov. 01, 2013 | Oct. 04, 2013 |
COMMITMENTS: | ' | ' | ' |
Leased office space at a rate of approximately per month | ' | $1,300 | $3,100 |
Leased smaller space in Fort Lauderdale on July 1, 2013 a rate of approximately per month | 2,200 | ' | ' |
Lease payments increasing through September 30, 2014 to September 30, 2015 | $3,193 | ' | ' |
Recovered_Sheet3
SUPPLEMENTAL NON-CASH INFORMATION (DETAILS) (USD $) | 9 Months Ended | |
Sep. 30, 2014 | Sep. 30, 2013 | |
SUPPLEMENTAL NON-CASH INFORMATION DETAILS | ' | ' |
Issuance of common stock totaling for accounting services | 42,000 | ' |
Issued common stock totaling | $11,400 | ' |
Issued shares of common stock | ' | 700,000 |
Issued warrants to purchase common stock | ' | 450,000 |
Issued shares of common stock to the former CEO of the Company for consulting services | ' | 500,000 |