Document and Entity Information
Document and Entity Information - USD ($) | 12 Months Ended | ||
Mar. 31, 2019 | Jul. 11, 2019 | Sep. 30, 2018 | |
Details | |||
Registrant CIK | 0001455926 | ||
Fiscal Year End | --03-31 | ||
Document Type | 10-K | ||
Document Annual Report | true | ||
Document Period End Date | Mar. 31, 2019 | ||
Document Transition Report | false | ||
Entity File Number | 000-53662 | ||
Entity Registrant Name | IronClad Encryption Corp | ||
Entity Incorporation, State or Country Code | DE | ||
Entity Tax Identification Number | 81-0409475 | ||
Entity Address, Address Line One | One Riverway | ||
Entity Address, Address Line Two | 777 South Post Oak Lane, Suite 1700 | ||
Entity Address, City or Town | Houston | ||
Entity Address, State or Province | TX | ||
Entity Address, Postal Zip Code | 77056 | ||
Entity Address, Address Description | Address of principal executive offices, including zip code | ||
City Area Code | 888 | ||
Local Phone Number | 362 - 7972 | ||
Phone Fax Number Description | Issuer’s telephone number, including area code | ||
Title of 12(b) Security | Common Stock, Class A | ||
Entity Listing, Par Value Per Share | $ 0.001 | ||
Trading Symbol | IRNC | ||
Security Exchange Name | NONE | ||
Entity Well-known Seasoned Issuer | No | ||
Entity Voluntary Filers | No | ||
Entity Current Reporting Status | Yes | ||
Entity Interactive Data Current | Yes | ||
Entity Filer Category | Non-accelerated Filer | ||
Entity Small Business | true | ||
Entity Emerging Growth Company | false | ||
Entity Shell Company | false | ||
Entity Public Float | $ 12,930,788 | ||
Share Price | $ 0.62 | ||
Entity Common Stock, Shares Outstanding | 303,415,017 | ||
Amendment Flag | false | ||
Document Fiscal Year Focus | 2019 | ||
Document Fiscal Period Focus | FY |
Consolidated Balance Sheets
Consolidated Balance Sheets - USD ($) | Mar. 31, 2019 | Mar. 31, 2018 |
Current assets: | ||
Cash and cash equivalents | $ 277,575 | $ 448,061 |
Accounts receivable | 0 | 301,978 |
Prepaid expenses and deposits | 29,900 | 55,719 |
Total current assets | 307,475 | 805,758 |
Other assets | ||
Patents, net | 367,786 | 170,976 |
Total other assets | 367,786 | 170,976 |
Total assets | 675,261 | 976,734 |
Current liabilities: | ||
Accounts payable | 604,149 | 612,367 |
Accounts payable, legal fees | 382,885 | 362,598 |
Accounts payable, related parties | 96,506 | 104,542 |
Accrued liabilities | 237,660 | 219,057 |
Accrued liabilities, payroll | 1,686,260 | 700,521 |
Accrued interest | 109,534 | 39,761 |
Total current liabilities | 5,711,129 | 2,505,668 |
Note payable, 8.5% | 0 | 490,000 |
Total other liabilities | 0 | 490,000 |
Commitments and contingencies | 0 | 0 |
Total liabilities | 5,711,129 | 2,995,668 |
Shareholders' equity: | ||
Preferred Stock, Value | 0 | 0 |
Additional paid-in capital | 22,783,591 | 11,514,917 |
Common shares of Class A stock to be issued | 6,400 | 101,750 |
Accumulated deficit | (27,967,566) | (13,703,597) |
Total shareholders' equity (deficit) | (5,035,868) | (2,018,934) |
Total liabilities and shareholders' equity | 675,261 | 976,734 |
Common Class A | ||
Shareholders' equity: | ||
Common Stock, Value | 140,168 | 66,457 |
Common Class B | ||
Shareholders' equity: | ||
Common Stock, Value | 1,539 | 1,539 |
Convertible note payable, 10%, net #1 | ||
Current liabilities: | ||
Convertible Notes Payable, Current | 82,500 | 3,362 |
Convertible note payable, 10%, net #2 | ||
Current liabilities: | ||
Convertible Notes Payable, Current | 45,500 | 61,585 |
Convertible note payable, 12%, net #3 | ||
Current liabilities: | ||
Convertible Notes Payable, Current | 0 | 85,698 |
Convertible note payable, 12%, net #4 | ||
Current liabilities: | ||
Convertible Notes Payable, Current | 4,000 | 50,415 |
Convertible note payable, 10%, net #5 | ||
Current liabilities: | ||
Convertible Notes Payable, Current | 82,500 | 6,168 |
Note payable, 06% #6 | ||
Current liabilities: | ||
Notes Payable, Current | 0 | 25,456 |
Convertible note payable, 09%, net #7 | ||
Current liabilities: | ||
Convertible Notes Payable, Current | 39,274 | 0 |
Convertible note payable, 09%, net #8 | ||
Current liabilities: | ||
Convertible Notes Payable, Current | 1,000 | 0 |
Convertible note payable, 10%, net #9 | ||
Current liabilities: | ||
Convertible Notes Payable, Current | 46,318 | 0 |
Convertible note payable, 12%, net #10 | ||
Current liabilities: | ||
Convertible Notes Payable, Current | 103,526 | 0 |
Convertible note payable, 10%, net #11 | ||
Current liabilities: | ||
Convertible Notes Payable, Current | 13,192 | 0 |
Convertible note payable, 12%, net #12 | ||
Current liabilities: | ||
Convertible Notes Payable, Current | 7,120 | 0 |
Convertible note payable, 09%, net #13 | ||
Current liabilities: | ||
Convertible Notes Payable, Current | 21,083 | 0 |
Convertible note payable, 10%, net #14 | ||
Current liabilities: | ||
Convertible Notes Payable, Current | 707 | 0 |
Convertible note payable derivative liabilities #15 | ||
Current liabilities: | ||
Convertible Notes Payable, Current | $ 2,147,415 | $ 234,138 |
Consolidated Balance Sheets - P
Consolidated Balance Sheets - Parenthetical - $ / shares | Mar. 31, 2019 | Mar. 31, 2018 | Dec. 31, 2017 |
Preferred Stock, Par or Stated Value Per Share | $ 0.001 | $ 0.001 | $ 0.001 |
Preferred Stock, Shares Authorized | 20,000,000 | 20,000,000 | 20,000,000 |
Preferred Stock, Shares Issued | 100 | 100 | 100 |
Preferred Stock, Shares Outstanding | 100 | 100 | 100 |
Common Class A | |||
Common Stock, Par or Stated Value Per Share | $ 0.001 | $ 0.001 | $ 0.001 |
Common Stock, Shares Authorized | 800,000,000 | ||
Common Stock, Shares, Issued | 140,168,393 | 66,446,701 | |
Common Stock, Shares, Outstanding | 140,168,393 | 66,446,701 | |
Common Class B | |||
Common Stock, Par or Stated Value Per Share | $ 0.001 | $ 0.001 | $ 0.001 |
Common Stock, Shares Authorized | 1,707,093 | ||
Common Stock, Shares, Issued | 1,538,872 | 1,538,872 | |
Common Stock, Shares, Outstanding | 1,538,872 | 1,538,872 |
Consolidated Statements of Oper
Consolidated Statements of Operations - USD ($) | 12 Months Ended | |
Mar. 31, 2019 | Mar. 31, 2018 | |
Details | ||
Revenue | $ 780,211 | $ 229,745 |
Operating expenses: | ||
Product development costs | 1,670,298 | 1,892,595 |
Service expenses | 604,733 | 194,422 |
General, administrative and other operating | 2,528,688 | 2,365,482 |
Officer and director fees | 5,616,582 | 4,309,945 |
Investor relations | 251,181 | 1,280,547 |
Professional fees | 218,664 | 455,599 |
Amortization | 3,789 | 30 |
Total operating expenses | 10,893,935 | 10,498,620 |
Loss from operations | (10,113,724) | (10,268,875) |
Other income (expense): | ||
Interest income | 2 | 30 |
Interest expense | (1,327,609) | (354,197) |
Financing expenses | (666,945) | (212,247) |
Early repayment penalty | (51,065) | (386,973) |
Loss on issuance of convertible notes with derivatives | (298,537) | 0 |
Loss on revaluations of derivatives | (1,569,018) | (49,190) |
Total other income (expense) | (3,913,172) | (1,002,577) |
Loss before income taxes | (14,026,896) | (11,271,452) |
Income taxes | ||
Income tax benefit | 0 | 0 |
Income tax expense | (3,474) | 0 |
Total other income tax benefit (expense) | 0 | 0 |
Net loss | $ (14,030,370) | $ (11,271,452) |
Basic and diluted loss per common share | $ (0.20) | $ (0.17) |
Weighted average shares outstanding, basic and diluted | 69,302,833 | 67,630,197 |
Consolidated Statements of Stoc
Consolidated Statements of Stockholders' Equity - USD ($) | Common Class A | Common Class B | Additional Paid-in Capital | Receivables from Stockholder | Retained Earnings | Total |
Equity Balance, Starting at Mar. 31, 2017 | $ 65,668 | $ 1,539 | $ 3,102,687 | $ (45,710) | $ (2,432,144) | $ 692,040 |
Shares Outstanding, Starting at Mar. 31, 2017 | 65,667,862 | 1,538,872 | ||||
Stock issued for cash | $ 289 | $ 0 | 127,214 | 0 | 0 | 127,503 |
Stock issued for cash, shares | 278,929 | 0 | ||||
Stock Issued During Period, Value, Conversion of Convertible Securities, Net of Adjustments | $ 50 | $ 0 | 78,450 | 0 | 0 | 78,500 |
Stock Issued During Period, Shares, Conversion of Convertible Securities | 60,280 | 0 | ||||
Stock Issued During Period, Value, Stock Options Exercised | $ 25 | $ 0 | 3,725 | 0 | 0 | 3,750 |
Share-based Compensation Arrangement by Share-based Payment Award, Options, Exercises in Period | 25,000 | 0 | ||||
Stock Issued During Period, Value, Issued for Services | $ 425 | 1,463,824 | 101,750 | 0 | 1,565,999 | |
Stock Issued During Period, Shares, Issued for Services | 425,000 | 0 | ||||
Options issued for development | $ 0 | $ 0 | 967,910 | 0 | 0 | 967,910 |
Options issued for development, shares | 0 | 0 | ||||
Stock options issued: G&A | $ 0 | $ 0 | 990,464 | 0 | 0 | 990,464 |
Stock options issued: officers, directors | $ 0 | $ 0 | 3,612,311 | 0 | 0 | 3,612,311 |
Stock options issued: officers, directors, shares | 0 | 0 | ||||
Stock options issued: investor relations | $ 0 | $ 0 | 478,086 | 0 | 0 | 478,086 |
Stock options issued: investor relations, shares | 0 | 0 | ||||
Stock options issued: financing fees | $ 0 | $ 0 | 287,629 | 0 | 0 | 287,629 |
Stock options issued: financing fees, shares | 0 | 0 | ||||
Beneficial conversion feature of note | $ 0 | $ 0 | 276,000 | 0 | 276,000 | |
Subscriptions receivable | 0 | 0 | 0 | 45,710 | 0 | 45,710 |
Retirement of derivative | 0 | 0 | 126,578 | 0 | 0 | 126,578 |
Stock Issued During Period, Value, Other | 0 | 0 | 39 | 0 | 0 | 39 |
Net Income (Loss) | $ 0 | $ 0 | 0 | 0 | (11,271,453) | (11,271,453) |
Shares Outstanding, Ending at Mar. 31, 2018 | 66,457,071 | 1,538,872 | ||||
Equity Balance, Ending at Mar. 31, 2018 | $ 66,457 | $ 1,539 | 11,514,917 | 101,750 | (13,703,597) | (2,018,934) |
Stock Issued During Period, Value, Conversion of Convertible Securities, Net of Adjustments | $ 65,821 | $ 0 | 615,604 | 0 | 0 | 681,425 |
Stock Issued During Period, Shares, Conversion of Convertible Securities | 65,819,552 | 0 | ||||
Stock Issued During Period, Value, Stock Options Exercised | $ 140 | $ 0 | 20,860 | 0 | 0 | 21,000 |
Share-based Compensation Arrangement by Share-based Payment Award, Options, Exercises in Period | 140,000 | 0 | ||||
Stock options issued: officers, directors | $ 0 | $ 0 | 4,712,264 | 0 | 0 | 4,712,264 |
Stock options issued: officers, directors, shares | 0 | 0 | ||||
Retirement of derivative | $ 0 | $ 0 | 1,773,987 | 0 | 0 | 1,773,987 |
Stock issued for services, G&A, value | $ 177 | $ 0 | 225,973 | (95,350) | 0 | 130,800 |
Stock issued for services, G&A, shares | 177,000 | 0 | ||||
Stock issued for services, financing | $ 100 | $ 0 | 4,500 | 0 | 0 | 4,600 |
Stock issued for services, financing, shares | 100,000 | 0 | ||||
Stock options issued: development | $ 0 | $ 0 | 1,642,735 | 0 | 0 | 1,642,735 |
Stock options issued: development, shares | 0 | 0 | ||||
Stock options issued: G&A | $ 0 | $ 0 | 1,993,242 | 0 | 0 | 1,993,242 |
Stock options issued: G&A, shares | 0 | 0 | ||||
Stock option issued: convertible debt | $ 0 | $ 0 | 53,386 | 0 | 0 | 53,386 |
Cashless exercise of warrants, value | $ 7,473 | $ 0 | 113,536 | 0 | 0 | 121,009 |
Cashless exercise of warrants, shares | 7,474,770 | 0 | ||||
Dividend treatment of convertible note warrants | $ 0 | $ 0 | 112,587 | 0 | (233,599) | (121,012) |
Net Income (Loss) | $ 0 | $ 0 | 0 | 0 | (14,030,370) | (14,030,370) |
Shares Outstanding, Ending at Mar. 31, 2019 | 140,168,393 | 1,538,872 | ||||
Equity Balance, Ending at Mar. 31, 2019 | $ 140,168 | $ 1,539 | $ 22,783,591 | $ 6,400 | $ (27,967,566) | $ (5,035,868) |
Consolidated Statements of Cash
Consolidated Statements of Cash Flows - USD ($) | 12 Months Ended | |
Mar. 31, 2019 | Mar. 31, 2018 | |
Cash flows from operating activities: | ||
Net loss: | $ (14,030,370) | $ (11,271,452) |
Adjustments to reconcile net loss to net operating cash used: | ||
Amortization expense | 3,789 | 30 |
Amortization of notes discount amounts | 166,988 | 42,700 |
Amortization of loan discount costs, BCF | 63,841 | 194,666 |
Amortization of loan discount costs, derivative liabilities | 942,063 | 0 |
Financing fees | 666,946 | 1,845 |
Loss on revaluations of derivatives | 1,569,018 | 0 |
(Gain) Loss on (retirement) issuance of note with derivative | 298,537 | 126,578 |
Common stock issued for services, product development | 0 | 967,911 |
Common stock issued for services, general and administrative | 13,509 | 425,000 |
Common stock issued for services, investor relations | 0 | 517,500 |
Stock options issued for services, development | 1,642,735 | 0 |
Stock options issued for services, general and administrative | 1,993,242 | 959,214 |
Stock options issued for services, officers and directors | 4,712,263 | 3,612,311 |
Stock options issued for services, investor relations | 0 | 478,086 |
Stock options issued for services, financing fees | 0 | 287,629 |
Changes in operating assets and liabilities: | ||
Decrease (increase) in accounts receivable | 301,978 | (301,978) |
Decrease in prepaid expenses and deposits | 25,819 | 318,373 |
Increase in accounts payable | 96,324 | 1,213,726 |
Increase in accrued liabilities | 1,004,344 | 917,577 |
Increase in accrued interest | 129,198 | 33,395 |
Net cash used in operating activities | (399,776) | (1,476,889) |
Cash flows from investing activities: | ||
Patent applications | (200,599) | (170,946) |
Net cash used in investing activities | (200,599) | (170,946) |
Cash flows from financing activities: | ||
Proceeds from options exercise, issuance of common stock, respectively | 21,000 | 272,789 |
Proceeds from issuance of convertible notes payable, 10% and 12%, respectively | 250,000 | 78,500 |
Less transaction costs | (15,000) | (3,500) |
Repayment of convertible note payable, 10% | (150,000) | 0 |
Proceeds from issuance of convertible notes payable, 12% and 10%, respectively | 115,500 | 100,000 |
Less transaction costs | (14,000) | (17,500) |
Proceeds from issuance of convertible notes payable, 09% and 10%, respectively | 135,000 | 165,000 |
Less transaction costs | (8,500) | (12,000) |
Proceeds from issuance of convertible notes payable, 09% and 10%, respectively | 157,500 | 82,500 |
Less transaction costs | (15,000) | (13,500) |
Proceeds from issuance of convertible notes payable, 10% and 12%, respectively | 107,000 | 88,000 |
Less transaction costs | (5,000) | (3,000) |
Repayment of convertible notes payable, 12% | (88,000) | 0 |
Proceeds from issuance of convertible note payable, 8.5%, amended | 100,000 | 500,000 |
Less transaction costs | (2,000) | (10,000) |
Repayment of note payable, 8.5%, amended | (600,000) | 0 |
Proceeds from issuance of convertible notes payable, 12% | 181,170 | 53,000 |
Less transaction costs | (30,824) | (3,000) |
Repayment of convertible notes payable, 12% | (53,000) | 0 |
(Repayment) proceeds from note payable, 6.5% | (25,457) | 25,457 |
Proceeds from issuance of convertible notes payable, 10% | 107,000 | 82,500 |
Less transaction costs | (5,000) | (13,500) |
Proceeds from issuance of convertible note payable, 12% | 57,750 | 0 |
Less transaction costs | (7,750) | 0 |
Proceeds from issuance of convertible note payable, 09% | 157,500 | 0 |
Less transaction costs | (15,000) | 0 |
Proceeds from issuance of convertible note payable, 10% | 86,250 | 0 |
Less transaction costs, and other respectively | (11,250) | 10,366 |
Net cash provided by financing activities | 429,889 | 1,382,112 |
Increase (decrease) in cash and cash equivalents | (170,486) | (265,723) |
Cash and Cash Equivalents, at Carrying Value, Beginning Balance | 448,061 | 713,784 |
Cash and Cash Equivalents, at Carrying Value, Ending Balance | 277,575 | 448,061 |
Supplemental disclosures: | ||
Interest paid in cash | 9,022 | 0 |
Income taxes paid | 1,810 | 0 |
Common stock issued to retire convertible notes payable, interest and fees | 681,425 | 93,266 |
Non-cash beneficial conversion rights & derivative liabilities related to convertible notes | $ 1,359,498 | $ 297,979 |
Note 1. Organization, Recent Hi
Note 1. Organization, Recent History, and Description of Businesses-Present and Past | 12 Months Ended |
Mar. 31, 2019 | |
Notes | |
Note 1. Organization, Recent History, and Description of Businesses-Present and Past | Note 1. Organization, Recent History, and Description of Businesses-Present and Past Description of Businesses: Present and Past IronClad Encryption Corporation (formerly Butte Highlands Mining Corporation) is a company developing and licensing cyber software technology to secure data files (stored and at rest) and electronic communications (in motion from electronic transmission over the internet or through telephone systems). Data at rest and in motion are both safeguarded from unauthorized access through the use of dynamic encryption and perpetual authentication. InterLok Key Management, Inc. (formerly InterLok Key Management, LLC) is the company that initially developed and maintained the patents and was formed in Texas on June 12, 2006 and incorporated ten years later on June 16, 2016. On January 6, 2017 InterLok entered into a Share Exchange Agreement ("Share Exchange") with Butte Highlands Mining Company. Under the terms of the agreement, the shareholders of InterLok Key Management, Inc. exchanged all 56,655,891 outstanding shares of InterLoks common stock for 56,655,891 shares of Class A common stock of Butte Highlands Mining Company. The Share Exchange was treated as a reverse merger with InterLok Key Management, Inc. which is deemedfor accounting recognition purposesas the accounting acquirer and Butte Highlands Mining Company deemed the accounting acquiree under the acquisition method of accounting. The reverse merger is deemed a recapitalization and the consolidated financial statements represent the substantive continuation of the operations and thus the prior year financial statements of operations are the operating results of its subsidiary InterLok Key Management, Inc., while the capital structure (in terms of authorized preferred and common stock) of its parent Butte Highlands Mining Company remains intact. Subsequently, the company was renamed IronClad Encryption Corporation to better identify with IronClads products and services. IronClad Encryption Corporation is a next-generation cyber defense company that secures digital assets and communications across a wide range of industries and technologies. IronClad Encryption-powered solutions use our patented Dynamic Encryption and Perpetual Authentication technologies to make all known key-based encryption technologies virtually impossible to compromise. Dynamic Encryption Technology eliminates vulnerabilities caused by exposure of any single encryption key by continuously changing encryption keys and keeping the keys synchronized in a fault-tolerant manner. Perpetual Authentication Technology uses multiple virtual channels for encryption so that in the event one channel is compromised, the other channels maintain encryption integrity. Together, these technologies not only eliminate the single point of failure problem created by having keys exposed through brute force, side channel, or other types of attack, but do so with very low latency and system performance overhead. Developers, MSPs, MSSPs and IT organizations can now easily and effectively integrate ultra-secure authentication and encryption measures across essentially all mediums. This includes the latest processors and operating systems, legacy hardware and software, within or between networks, and on compartmentalized data or entire databases. History and Reverse Merger in January of 2017 The Company is the term used in these statements and notes to refer to the entity originally incorporated in the State of Delaware in 1929. The registered name of the Company until early in 2017 was Butte Highlands Mining Company (Butte). Butte was formed to explore and mine primarily for gold in the Butte Highlands Only Chance mine, south of Butte, Montana. Butte ceased operating as a mining company in 1942. The Company was reorganized in October 1996 for the purpose of acquiring and developing additional mineral properties. At the time of the 1996 reorganization, stockholders representing approximately 76% of the outstanding capital stock could not be located. In order to obtain the quorum necessary for the special meetings of shareholders to authorize the reorganization, Butte obtained an order from the Superior Court of Spokane County, Washington appointing a trustee for the benefit of those stockholders who could not be located. By May 17, 2007, eleven years after the reorganization and very limited results from its mining activities, the Company had disposed of all of its historical mineral properties or mining claims and eventually became a shell company under the rules of the Securities and Exchange Commission (SEC). In 2009, Butte registered under the Securities Exchange Act of 1934, as amended, for the purpose of becoming a reporting company. The Companys common stock then became listed on the OTCBB, but in time the Company also listed its common stock to trade on the OTC QB electronic market, one of the OTC Markets Group over-the-counter markets, where the Companys common stock is listed. Then, following ten years of being a shell company with only nominal activity and limited cash or other assets, the business focus of Butte changed early in 2017. Most notably the Company raised significant capital to implement its new business and financial plans to further develop the licensing and commercial use of its patented encryption software. The change caused Butte to lose its previous shell company status. The Company also changed its state of incorporation to Nevada and its name to IronClad Encryption Corporation (IronClad) and changed the stock symbol from BTHI to IRNC to more appropriately reflect the fundamental change of its business to developing cyber encryption technology and away from its historical mining activities. On October 16, 2017, the Company redomiciled in Delaware from Nevada and adopted a certificate of incorporation and bylaws as a Delaware corporation. The terms Company, IronClad and Butte all refer to the same individual corporate entity, but the uses of the IronClad and Butte names are used to refer to different eras of the Companys long history. The historical eras generally coincide with the changes in business focus before and after the first weeks of 2017. The business changes are a result of a common stock exchange transaction, accounted for as a reverse merger, between Butte and the owners of InterLok Key Management, Inc. (InterLok; at the time an independent and privately-held Texas corporation) whereby InterLok became a wholly-owned subsidiary of Butte. Butte issued shares of its common stock in exchange for acquiring all of the common stock of InterLok. Through December 31, 2017, InterLok was the only subsidiary of the Company and InterLoks patents and line of business now are the main basis of the business of the Company on a consolidated basis. During the year ended March 31, 2018, the Company incorporated a new wholly owned subsidiary IronClad Pipeline IC, Inc. (Pipeline). Principles of consolidation The accompanying consolidated financial statements include the accounts of IronClad and its wholly-owned subsidiaries. All intercompany accounts and transactions have been eliminated in consolidation. The above consolidated financial statements have been prepared in accordance with generally accepted accounting principles. |
Note 2. Summary of Significant
Note 2. Summary of Significant Accounting Policies | 12 Months Ended |
Mar. 31, 2019 | |
Notes | |
Note 2. Summary of Significant Accounting Policies | Note 2. Summary of Significant Accounting Policies This summary of significant accounting policies is presented to assist in understanding the Companys consolidated financial statements. The financial statements and notes are representations of the Companys management which is responsible for their integrity and objectivity. These accounting policies conform to accounting principles generally accepted in the United States and have been consistently applied in the preparation of the financial statements. Going Concern As shown in the accompanying financial statements, the Company has incurred cumulative operating losses since inception. As of March 31, 2019, the Company has limited financial resources with which to achieve its objectives and attain profitability and positive cash flows from operations. As shown in the accompanying balance sheets and statements of operations, the Company has an accumulated deficit of $27,967,566. The Company's working capital deficit is $5,403,654, (current assets minus current liabilities; current liabilities in this case being greater than current assets). Achievement of the Company's objectives will depend on its ability to obtain additional financing, to generate revenue from current and planned business operations, and to effectively manage product and software development, operating and capital costs. The Company is in a development stage and has generated no operating revenue, profits or positive cash flows from operations. The Company plans to fund its future operations by potential sales of its common stock or by issuing debt securities. However, there is no assurance that IronClad will be able to achieve these objectives, therefore substantial doubt about its ability to continue as a going concern exists. The financial statements do not include adjustments relating to the recoverability of recorded assets nor the implication of associated bankruptcy costs should IronClad be unable to continue as a going concern. Revenue Recognition and Trade Accounts Receivable The Company recognizes revenue in accordance with ASC 606 Revenue From Contracts With Customers We record trade accounts receivable at net realizable value. This value includes an appropriate allowance for estimated uncollectible accounts, if any, to reflect any loss anticipated on the trade accounts receivable balances and charged to the provision for doubtful accounts. Earnings (Losses) Per Share Basic earnings per share are computed by dividing net income (loss) by the weighted-average number of common shares outstanding during the year. Fully-diluted earnings per share is computed by dividing net income (loss) by the sum of the weighted-average number of common shares outstanding and the additional common shares that would have been outstanding if potential common shares had been issued. Potential common shares are not included in the computation of fully diluted earnings per share if their effect is anti-dilutive. Cash Equivalents The Company considers cash, certificates of deposit, and debt instruments with a maturity of three months or less when purchased to be cash equivalents. Fair Value Measures The Company's financial instruments, as defined by the Financial Accounting Standards Boards Accounting Standards Codification (ASC) 825-10-50 Financial InstrumentsOverall (and subtopics) The standards under ASC 820 Fair Value Measurement · · · At March 31, 2019 and 2018 the Company did not have any assets measured at fair value other than cash and deposits. At March 31, 2019 and 2018 the Company had conversion features embedded in its convertible notes payable. The fair value measurement of those derivatives, using a Binomial valuation model, was $2,147,415 at March 31, 2019 and $234,138 at March 31, 2018 and is reported as derivative liability on the balance sheet. Provision for Income Taxes Income taxes are provided based upon the liability method of accounting pursuant to ASC 740-10-25 Income Taxes Recognition Capitalization of Patent and Trademark Costs The Company capitalizes its legal, patent agent and related filing fees and costs associated with the patents it holds and is developing. The amounts are carried as an intangible asset in the financial statements. The costs of the patents or trademarks are amortized ratably (expensed) over the expected useful technological or economic life of the individual assets, which the Company has determined to be ten years. The legal life of a patent is typically about 20 years. See Note 3. Reclassification of Prior Year Presentation Certain prior year amounts have been reclassified to provide greater line item detail for consistency with the current period presentation. These reclassifications had no effect on the reported results of operations. This change in classification has no effect on previously reported cash flows in the Condensed Consolidated Statement of Cash Flows and had no effect on the previously reported Condensed Consolidated Statements of Operations for any period New Accounting Requirements and Disclosures Accounting standards that have been issued or proposed by FASB that do not require adoption until a future date are not expected to have a material impact on the consolidated financial statements upon adoption. The Company does not discuss recent pronouncements that are not anticipated to have an impact on or are unrelated to its financial condition, results of operations, cash flows or disclosures. FASB issued standard ASU 2018-07 CompensationStock Compensation (Topic 718): Improvements to Nonemployee Share-Based Payment Accounting FASB issued standard ASU 2017-11 Earnings Per Share (Topic 260); Distinguishing Liabilities from Equity (Topic 480); Derivatives and Hedging (Topic 815): (Part I) Accounting for Certain Financial Instruments with Down Round Features, (Part II) Replacement of the Indefinite Deferral for Mandatorily Redeemable Financial Instruments of Certain Nonpublic Entities and Certain Mandatorily Redeemable Noncontrolling Interests with a Scope Exception. FASB issued ASU No. 2016-02, Leases Use of Estimates The preparation of the consolidated financial statements in conformity with accounting principles generally accepted in the United States requires management to make estimates and assumptions that affect the reported amounts of assets, liabilities and expenses at the balance sheet date and for the period then ended. We believe our estimates and assumptions are reasonable; however, such estimates and assumptions are subject to a number of risks and uncertainties that may cause actual results to differ materially from such estimates. Significant estimates and assumptions underlying these financial statements include: · · · · We are subject to claims and liabilities that arise in the ordinary course of business. We accrue for losses when such losses are considered probable and the amounts can be reasonably estimated. |
Note 3. Patents
Note 3. Patents | 12 Months Ended |
Mar. 31, 2019 | |
Notes | |
Note 3. Patents | Note 3. Patents Patents and trademarks are as follows: March 31, 2019 March 31, 2018 Patents and trademarks under development $ 217,744 $ 170,946 Patents issued 153,801 398 Less accumulated amortization (3,759) (368) 150,042 30 Patents, net $ 367,786 $ 170,976 Amortization expense for intangible assets during the year ended March 31, 2019 and March 31, 2018 was $3,759 and $30, respectively. Costs at March 31, 2019 totaling $367,786 are for $217,744 for new patents and trademarks under development (but as yet not awarded) and for $153,801 for new patents issued in December 2018 and January 2019. The patents and trademarks under development will not be amortized until formally issued. To the extent that a patent or trademark is not ultimately awarded the associated costs will be expensed accordingly at the time such an outcome is apparent. IronClad filed fourteen patent applications during the years ended March 31, 2019 and March 31, 2018. These pending patents expand upon the initial scope of the original seminal patents and provide up to twenty additional years of enforceable intellectual property rights regarding authentication, validation, and encryption for all electronic transmissions associated devices. IronClads current and original patent portfolio included three issued and granted US patents. Each of the three original patents has expired and was written off at September 30, 2018. IronClad was recently granted seven patents from the United States Patent and Trademark Office (USPTO) from its fourteen recent patent filings, and the remaining seven now continue under routine, formal examination and review. Based on previous process and timing, IronClad expects to have the remaining seven patents granted during 2019. International patent protection has also been filed for all fourteen of these granted and pending patents. |
Note 4. Concentration of Credit
Note 4. Concentration of Credit Risk | 12 Months Ended |
Mar. 31, 2019 | |
Notes | |
Note 4. Concentration of Credit Risk | Note 4. Concentration of Credit Risk Financial instruments that potentially subject the Company to concentration of credit risk consist principally of cash deposits. Accounts at each institution are insured by the Federal Deposit Insurance Corporation (FDIC) up to $250,000. At March 31, 2019 and March 31, 2018 the Company had $0 and $37,907 on deposit in excess of the FDIC insured limit, respectively. The Company did have a nominal exposure to a concentration of credit risk: all of our revenue was from one customer. However, we viewed the risk was limited because of the financial strength and liquidity of the multi-billion dollar energy customer that has operated profitably for more than a century. |
Note 5. Notes Payable
Note 5. Notes Payable | 12 Months Ended |
Mar. 31, 2019 | |
Notes | |
Note 5. Notes Payable | Note 5. Notes Payable 2017 Convertible Note 12% On June 26, 2017 IronClad entered into a Securities Purchase Agreement to issue a 12% convertible note payable for an aggregate principal amount of $78,500 with the intent of meeting certain conditions precedent to closing and funding on or before July 7, 2017. The closing conditions were met prior to that date and the convertible note payable was closed and funded on July 6, 2017. The Company received cash proceeds of $75,000 net of transaction costs of $3,500. The $3,500 was recorded as a discount amount on the note payable and was amortized as interest expenses over the life of the note. $3,500 was amortized during the year ended March 31, 2018; accrued interest payable at March 31, 2018 was zero. The note matures on March 30, 2018 and interest costs accrue on the unpaid principal balance at 12% annually until March 30, 2018, and after that if not paid at maturity interest accrues annually at 22% until the principal amount and all interest accrued and unpaid are paid. The holder of the note, at its sole election, could convert the note into shares of common stock of the Company at any time during the period beginning on the date which is one hundred and eighty days following the date of the note (dated June 26, 2017) and ending on the later of i) the maturity date, or ii) the date of payment of a default amount, if any. The shares to be issued are a function of a variable conversion price which is 65% of a market price defined to be the lowest one day closing bid price for the Companys common stock during the fifteen-day trading period ending on the last trading day prior to exercising the conversion right. The Company will keep available authorized shares reserved, initially 289,846 shares, but in any event authorized shares equal to six times the number of shares that would be issuable upon full conversion of the note from time to time. The conversion feature of the note represented an embedded derivative. The derivative value at December 23, 2017 was determined using a Black-Scholes valuation model. Accounting recognition of $126,578 for the fair value of the derivative liability, $73,272 (net of $4,116 of amortization) was recorded as a contra liability to the original $78,500 recorded liability of the underlying convertible note, and a $49,190 loss was recognized as a fair valuation adjustment to earnings. Between January 10, 2018 and January 28, 2018, the note holder exercised its rights under the conversion provisions and through operation of the five conversion elections was issued, in total, 50,322 shares of stock which effectively repaid the loan balance. $73,272 was recorded as a gain on conversion during the year ended March 31, 2019 The dates, shares issued and principal amounts repaid at each conversion event are as follows: Conversion Date Principal Outstanding Principal Reduction Shares Issued Exercise Price 12/31/2017 $78,500 1/10/2018 $63,500 $(15,000) 8,242 $1.82 1/12/2018 $43,500 $(20,000) 10,989 $1.82 1/18/2018 $28,500 $(15,000) 8,242 $1.82 1/23/2018 $13,500 $(15,000) 9,819 $1.53 1/25/2018 $ $(13,500) 13,030 $1.40 Total 50,322 Commitment Note and Convertible Note On August 24, 2017, IronClad entered into an Investment Agreement to establish an equity line of funding for the potential future issuance and purchase of IronClads shares of Class A common stock. See Note 7. As consideration for its commitment to purchase shares of IronClads Class A common stock pursuant to the Investment Agreement, IronClad issued to the counterparty of the agreement a seven-month 10% convertible promissory note (the Commitment Note) in the principal amount of $100,000. The Commitment Note matured on March 24, 2018. The Commitment Note is convertible into shares of IronClads Class A common stock at the fixed price of $3.25 per share; provided, however, that at any time and from time to time after a default occurs solely due to the fact the Commitment Note is not retired on or before the maturity date, all or any part of the Commitment Note is convertible into shares of Class A common stock of the Company at a per share price equal to the lower of: (a) $3.25 or (b) 65% of the average of the two lowest per share trading prices of the Class A common stock during the twenty consecutive trading days prior to the conversion date. The Commitment Note is included as a financing fee expense at the date of the transaction. The Commitment Note was to finance the $100,000 cost of the commitment fee to the counterparty of the Investment Agreement and is accordingly included in the financing fee expenses for the period ended September 30, 2017. The amount of the commitment fee could be reduced by $35,000 or $17,500 if a registration statement registering the shares that would be issued under the equity line becomes effective within 90 or 135 days, respectively, of August 24, 2017. The registration statement was declared effective on December 18, 2017 a period less than 135 days (but more than 90 days) after August 24, 2017. Consequently, the principal balance of the commitment fee was reduced by $17,500 and $100,000 of financing fee expenses originally recognized in the three-month period ended September 30, 2017 were adjusted to reflect a lower $82,500 financing fee expense. During the year ended March 31, 2019, $15,692 of regular interest and $79,138 of derivative liability was expensed. During the year ended March 31, 2018, $10,810 of regular interest was expensed. On August 24, 2017, in connection with the entry into the Investment Agreement, IronClad also issued a 10% convertible note (the Convertible Note) in an aggregate principal amount of $330,000 with a 10% original issue discount (OID). The initial consideration in the amount of $165,000 was funded on August 24, 2017. The Company received net proceeds of $150,000 (which represents the deduction of the 10% original issue discount for the note holders due diligence and legal fees). The Company may make additional borrowings in such amounts and at such dates as the note holder may choose in its sole discretion. The balance of individual borrowings matures seven months from its funding date. The Convertible Note also has an embedded beneficial conversion feature (BCF) based on a stated conversion price of $1.00 per share. The market price of a share of IronClads common stock at the time of the first borrowing under the note was $3.50 thus establishing an intrinsic value of $2.50 on that date. The Company received the first borrowing for $165,000 under the Convertible Note on August 24, 2017 and net cash proceeds of $150,000 were received after deducting for the original issue discount and lender transaction costs of $15,000. An additional $12,000 of costs was incurred by IronClad directly relating to the note. Both the $15,000 and the $12,000 are recorded as discount amounts on the $165,000 note payable and are amortized as interest expenses over the life of the borrowing. The maturity date of this borrowing under the note is seven months from its funding date which is March 24, 2018. Between March 26, 2018 and February 25, 2019, the note holder exercised its rights under the conversion provisions and through operation of seven conversion elections was issued, in total, 4,588,586 shares of stock which effectively repaid the loan balance. Additionally, between March 14, 2019 and March 28, 2019, the note holder elected to convert approximately $37,698 of accrued interest into 7,683,614 shares of Class A common stock. The dates, shares issued and principal amounts repaid at each conversion event are as follows: Conversion Date Principal Outstanding Principal Reduction Shares Issued Exercise Price 12/31/2017 165,000 3/26/2018 $ 155,000 $(10,000) 9,958 $ 1.00425 06/01/18 $ 135,000 $(20,000) 32,219 $ 0.62 07/17/2018 $ 115,000 $(20,000) 61,538 $ 0.325 8/23/2018 $ 105,000 $(10,000) 73,260 $ 0.1365 09/14/18 $ 85,000 $(20,000) 236,686 $ 0.0845 02/06/19 $ 45,000 $(40,000) 2,051,282 $ 0.0195 02/25/19 $ - $(45,000) 2,123,643 $ 0.02119 Total 4,588,586 The valuation of the BCF related to the $165,000 borrowing on the Convertible Note and with an intrinsic value of $2.50 per share (based on a $3.50 closing price less the $1.00 per share conversion price) is approximately $424,407 using a Black-Scholes valuation model. That amount is recorded as a contra-note payable amount (similar to the recorded OID and transaction costs), but only for an amount not in excess of and thus capped by the otherwise undiscounted amount of the note payable. The amount of the beneficial conversion feature formally recorded is $138,000 ($165,000 net of $27,000) and will be amortized as interest expense over the life of the loan. On March 24, 2018 both the Commitment Note ($100,000 contractually reduced to $82,500 in 2017) and the first tranche of the 10% Convertible Note for $165,000 (less the $10,000 conversion in late March) reached their maturity dates and, except for a $10,000 conversion by Tangiers on the Convertible Note, were not repaid in cash. Consequently both notes were in maturity date default and, pursuant to the terms of the loans, were convertible at the lesser of $3.25 for the Commitment Note, and $1.00 for $165,000 note or 65% of the average lowest two trades for the prior 20 days, resulting in an initial recognition for derivative treatments for both notes. The valuation of the derivative liability related to the $82,500 borrowing on the Convertible Note and with an intrinsic value of $0.70 per share (based on a $1.67 closing price less the $0.97 per share present value of the conversion price) is approximately $79,138 using a Black-Scholes valuation model. That amount is recorded as a new contra-note payable amount (similar to the recorded OID and transaction costs), but only for an amount not in excess of and thus capped by the otherwise undiscounted amount of the note payable. This results in a net liability value of $3,362. The amount will be amortized as interest expense over an estimated remaining three month life of the already matured loan. The valuation of the derivative liability related to the $165,000 (reduced to $155,000) borrowing on the Convertible Note and with an intrinsic value of $0.70 per share (based on a $1.67 closing price less the $0.97 per share present value of the conversion price) is approximately $158,276 using a Black-Scholes valuation model. That amount is recorded as a new contra-note payable amount (similar to the recorded OID and transaction costs), but only for an amount not in excess of and thus capped by the otherwise undiscounted amount of the note payable. Since the undiscounted (and unconverted) amount of the note is $155,000 the derivative valuation is recorded as $155,000. The amount will be amortized as interest expense over an estimated remaining three month life of the already matured loan. During the year ended March 31, 2019, $21,039 of regular interest and $155,000 of derivative liability was expensed. During the year ended March 31, 2018, $16,500 of regular interest, $27,000 of original issue discount and $138,578 of beneficial conversion was expensed. On October 23, 2017, a second borrowing of $82,500 under the Convertible Note for $330,000 was closed and funded. The Company received net proceeds of $75,000 after deducting for original issue discount and lender transaction costs of $7,500. An additional $6,000 of costs was incurred by IronClad relating to the Convertible Note. Both the $7,500 and the $6,000 were recorded as discount amounts on the $82,500 note payable and amortized as interest expenses over the life of the borrowing. The maturity date of this borrowing under the Convertible Note was also defined to be seven months from its borrowing date which is May 24, 2018. The market price of a share of IronClads common stock at the time of funding was $4.40 making the intrinsic value of the derivative $3.40. The valuation of the BCF is estimated to be approximately $289,000 and is capped at $69,000, the otherwise undiscounted amount of the note payable. Between March 14, 2019 and March 28, 2019, the holder of the note elected to convert $37,000 of principal into 8,024,179 shares of Class A common stock. The dates, shares issued and principal amounts repaid at each conversion event are as follows: Conversion Date Principal Outstanding Principal Reduction Shares Issued Exercise Price 12/31/18 82,500 3/14/2019 $77,500 $(5,000) 889,284 $.0056225 03/25/19 $53,500 $(24,000) 5,351,171 $0.004485 03/27/19 $49,500 $(4,000) 891,862 $0.004485 03/28/19 $45,500 $(4,000) 891,862 $0.004485 Total 8,024,179 During the year ended March 31, 2019, $16,026 of regular interest, $20,916 of original issue discount, and $57,024 of derivative liability was expensed. During the year ended March 31, 2018, $6,158 of regular interest, $12,136 of original issue discount and $49,449 of derivative liability was expensed. On March 15, 2018, a third and final borrowing of $82,500 under the Convertible Note for $330,000 was closed and funded. The Company received net proceeds of $75,000 after deducting for original issue discount and lender transaction costs of $7,500 and an additional $6,000 of loan closing costs incurred by IronClad. The maturity date of this borrowing under the Convertible Note is also defined to be seven months from its borrowing date which is October 24, 2018. The market price of a share of IronClads common stock at the time of funding was $1.85 making the intrinsic value of the derivative $0.85. The valuation of the BCF related to the $82,500 borrowing on the Convertible Note and with an intrinsic value of $0.85 per share (based on a $1.85 closing price less the $1.00 per share conversion price) is approximately $109,861 using a Black-Scholes valuation model. That amount is recorded as a contra-note payable amount (similar to the recorded OID and transaction costs), but only for an amount not in excess of and thus capped by the otherwise undiscounted amount of the note payable. The amount of the beneficial conversion feature formally recorded is $69,000 ($82,500 net of $13,500) and will be amortized as interest expense over the life of the loan. During the year ended March 31, 2019, $20,606 of regular interest, $12,491 of original issue discount, $63,841 of beneficial conversion and $20,064 of derivative liability was expensed. During the year ended March 31, 2018, $620 of regular interest, $1,009 of original issue discount and $5,159 of beneficial conversion was expensed. 2018 Convertible Notes, 12% On January 25, 2018 IronClad entered into a Securities Purchase Agreement to issue a new 12% convertible note payable for an aggregate principal amount of $88,000. The Company received cash proceeds of $85,000 net of transaction costs of $3,000. The $3,000 is recorded as a discount amount on the note payable and will be amortized as interest expenses over the life of the note. The general terms of the note, except for the principal amount borrowed, are identical to the initial 12% Convertible note entered into in 2017 and converted earlier in January 2018. The note matures on October 30, 2018 and interest costs accrue on the unpaid principal balance at 12% annually until October 30, 2018, and after that if not paid at maturity interest accrues annually at 22% until the principal amount and all interest accrued and unpaid are paid. The holder of the note, at its sole election, could convert the note into shares of common stock of the Company at any time during the period beginning on the date which is one hundred and eighty days following the date of the note (dated January 25, 2018) and ending on the later of i) the maturity date, or ii) the date of payment of a default amount, if any. The shares to be issued are a function of a variable conversion price which is 65% of a market price defined to be the lowest one day closing bid price for the Companys common stock during the fifteen-day trading period ending on the last trading day prior to exercising the conversion right. The Company would keep available authorized shares reserved, initially 289,846 shares, but in any event authorized shares equal to six times the number of shares that would be issuable upon full conversion of the note from time to time. During the year ended March 31, 2019, $3,009 of regular interest, $2,302 of original issue discount and $57,990 of derivative liability was expensed. During the year ended March 31, 2018, $1,765 of regular interest and $698 of original issue discount was expensed. The loan principal plus accrued interest, both totaling $124,268, was repaid on July 14, 2018 and the note was fully retired. On February 27, 2018 IronClad entered into a Securities Purchase Agreement to issue a 12% convertible note payable for an aggregate principal amount of $53,000. The Company received cash proceeds of $50,000 net of transaction costs of $3,000. The $3,000 is recorded as a discount amount on the note payable and will be amortized as interest expenses over the life of the note. The general terms of the note, except for the principal amount borrowed, are identical to the initial 12% Convertible note entered into in 2017 and converted earlier in January 2018. The note matures on November 03, 2018 and interest costs accrue on the unpaid principal balance at 12% annually until November 30, 2018, and after that if not paid at maturity interest accrues annually at 22% until the principal amount and all interest accrued and unpaid are paid. The holder of the note, at its sole election, may convert the note into shares of common stock of the Company at any time during the period beginning on the date which is one hundred and eighty days following the date of the note (dated February 27, 2018) and ending on the later of I) the maturity date, or ii) the date of payment of a default amount, if any. The shares to be issued are a function of a variable conversion price which is 65% of a market price defined to be the lowest one day closing bid price for the Companys common stock during the fifteen-day trading period ending on the last trading day prior to exercising the conversion right. The Company will keep available authorized shares reserved, initially 289,846 shares, but in any event authorized shares equal to six times the number of shares that would be issuable upon full conversion of the note from time to time. The conversion feature of the note represents an embedded derivative. Once definitive pricing facts and circumstances are known later in the year regarding the market value of IronClads common stock at that time, the cost of that derivative will be determined using a Black-Scholes valuation model. At the close of accounting periods subsequent to the initial valuation a redetermination of the derivative valuation will be made using an updated Black-Scholes valuation model. Any gain or loss in the liability value will be recognized as a fair valuation adjustment to earnings. The loan principal plus accrued interest, both totaling $75,620, was repaid on August 21, 2018 and the note was fully retired. During the year ended March 31, 2019. $2,492 of regular interest, $2,585 of original issue discount and $42,862 of derivative liability was expensed. During the year ended March 31, 2018, $558 of regular interest and $415 of original issue discount was expensed. Working Capital Loan for Services to New Customer by IronClad Pipeline IC, Inc. On February 27, 2018, IronClad borrowed $255,000 gross proceeds as an initial advance on a Credit Agreement (the Agreement) with a lending party. The Agreement, agreed to by both parties on February 1, 2018, enabled the Company, at its sole election, to borrow up to an aggregate amount of $500,000. The outstanding balance of any advances accrues interest at the annual rate of 8.5%. There is a transaction financing fee of 2% for any amount drawn under the facility. Proceeds received net of the transaction fee were $250,000. On March 21, 2018, IronClad borrowed and additional $245,000 gross proceeds as a second advance under the Agreement. Proceeds received net of the transaction fee were $240,000. During the period ended June 30, 2018, the Company repaid $100,000 of the principal, and then redrew another $100,000. On June 30, 2018 the Company repaid $25,000. During the period ended September 30, 2018, the Company repaid all of the outstanding principal balance of the loan, however the accrued interest remains outstanding the amount of $17,816 Interest is to be paid annually in cash on March 1, 2019 and 2020. Outstanding interest was not paid at March 1, 2019; the Company is negotiating with the lender to issue common stock in exchange for the accrued amount of interest owed. There is no penalty for any early principal repayments. The Company has pledged 500,000 of its common stock as collateral under the terms of the Agreement. In the event of default by the Company, the lender is entitled to receive one share of Company common stock for every one dollar in principle, interest, penalties, and fees that are owed and outstanding by the Company to Layer 3 Communications. The Agreement is also supported by a personal $500,000 guarantee from an officer of the Company. IronClad will pay a 5% guarantee fee of $25,000; $10,000 shortly after year end and the remaining $15,000 at such time as the Board of Directors determines the Company has sufficient liquidity to pay the balance owed. The guarantee fee was reviewed and approved by the Compensation Committee of the Board which determined that the 5% fee was an appropriate market-based rate for guarantees of loans of this nature and comparable risk. Terms of the Agreement specify the use of funds to be limited to only supporting the operations of its new service contract. The terms of the Agreement were amended, effective June 11, 2018, to also permit the use of funds for certain new patent application filings of IronClad. 2018 Financing Note On March 16, 2018, IronClad purchased several lines of corporate insurance coverage for a set of annual premiums that totaled $30,719. To pay for the coverage, IronClad paid $2,631 down on the coverages and entered into a financing agreement to borrow the $28,087 balance owed for the coverage. Interest on the loan is approximately 6% and the loan is repaid by eleven monthly principal and interest installment payments of $2,631 each. The cost of the insurance is recorded as a prepaid asset and is being amortized monthly over the annual period of the coverages. During the period ended September 30, 2018 this note was repaid in full. 2019 New Loan Agreements including Convertible Notes On June 26, 2018 IronClad entered into a Securities Purchase Agreement to issue a 10% convertible note payable for an aggregate principal amount of $250,000. The Company received cash proceeds of $235,000 net of transaction costs of $15,000. The $15,000 is recorded as a discount amount on the note payable and will be amortized as interest expenses over the life of the note. The general terms of the note, except for the principal amount borrowed, are identical to the initial 10% Convertible note entered into in 2017. The note matures on December 26, 2018 and interest costs accrue on the unpaid principal balance at 10% annually until December 26, 2018, and after that if not paid at maturity interest accrues annually at 24% until the principal amount and all interest accrued and unpaid are paid. The holder of the note, at its sole election, may convert the note into shares of common stock of the Company at any time on or following the date of the note and ending on the later of i) the maturity date, or ii) the date of payment of a default amount, if any. The shares to be issued are a function of a fixed conversion price of $1.00, or an alternate variable conversion price, triggered by events such as stock splits, stock dividends or rights offerings which is 70% of a market price defined to be the lowest five day closing bid price for the Companys common stock during the twenty-day trading period ending on the last trading day prior to exercising the conversion right. The Company will keep available authorized shares reserved, initially 3,081,854 shares, but in any event authorized shares equal to five times the number of shares that would be issuable upon full conversion of the note from time to time. The conversion feature of the note represents an embedded derivative. A derivative liability with an intrinsic value of $0.03281 was $189,211 using a binomial pricing model and was calculated as a discount to the note. That amount is recorded as a new contra-note payable amount (similar to OID and transactions costs and amounts discussed immediately below), but only for an amount not in excess of and thus capped by the otherwise undiscounted amount of the note payable. The amount of the derivative liability formally recorded is $26,014 ($250,000 net of $223,986) and will be amortized as interest expense over the life of the loan. The remaining $163,197 is expensed as financing fees. As a commitment fee for the Note, the Company issued the holder 240,384 shares of common stock to be held in escrow until the Note is repaid. The holder will keep the shares, if the Note is not retired prior to its maturity date. The shares were valued at $165,865 and were recorded as a discount on the note and amortized through repayment of the note on November 1, 2018. Upon repayment of the note the shares were returned and the $165,865 expense was reversed Included in the share purchase agreement was a common stock purchase warrant issued by the Company to the holder to purchase 62,500 shares of common stock at $3.00 per share, exercisable for four years. The warrants were valued at $43,121 using a Black Scholes option pricing model and were recorded as a discount on the note. The warrants included a down round feature in January 2019. The warrant included a down round feature that would reduce the exercise price of the warrant, if the Company sold or granted any option to purchase, or sell or grant any right to reprice, or otherwise disposed of or issued common stock or securities entitling any person or entity to acquire shares of common stock (upon conversion, exercise or otherwise) at an effective price per share less than the then exercise price. On January 17, 2019, the down round feature was triggered and the exercise price was reduced to $0.0195 and the number of warrants exercisable was increased to 9,615,385. As a result, the original valuation of $43,121 was increased to $164,132 and a reduction to retained earnings was recorded for the difference, similar to a dividend, in the amount of $121,011. During the year ended March 31, 2019. $8,873 of regular interest, $58,121 of original issue discount, and $26,342 of derivative liability was expensed. On October 11, 2018 the holder of the note converted $100,000 of the principal into 3,076,923 shares of Class A capital stock. On November 1, 2018 the Company paid off the remaining $150,000 of principal in cash. On July 11, 2018 IronClad entered into a Securities Purchase Agreement (SPA) to issue a 9% convertible note payable for an aggregate principal amount of $270,000 comprised of the first note (First Note) being in the amount of $135,000.00, and the remaining note in the amount of $135,000.00, (a Back End Note). The Company received cash proceeds of $126,500 from the First Note net of transaction costs of $8,500. The $8,500 is recorded as a discount amount on the note payable and will be amortized as interest expenses over the life of the note. The First Note matures on July 11, 2019 and interest costs accrue on the unpaid principal balance at 9% annually until July 11, 2019, and after that if not paid at maturity interest accrues annually at 24% until the principal amount and all interest accrued and unpaid are paid. The Back End Note carries the same terms as the First Note, except it may not be repaid, but only converted. The Company is under no obligation to accept the Back End Note, but may do so at its sole discretion, following 180 days from the date of the note (dated July 11, 2018). As part of the SPA, the Holder issued the Company a collateralized secured promissory note in the amount of $131,500 that may be exchanged for cash against the Back End Note. On January 25, 2019, the holder of the note chose to cancel the Back End Note. The holder of the note, at its sole election, may convert the note into shares of common stock of the Company at any time during the period beginning on the date which is 180 days following the date of the note (dated July 11, 2018) and ending on the later of i) the maturity date, or ii) the date of payment of a default amount, if any. The shares to be issued are a function of a fixed conversion price of $1.00 per share for six months, and thereafter until maturity at a variable conversion price which is 65% of a market price defined to be the lowest trading price for the Companys common stock during the fifteen-day trading period ending on the last trading day prior to exercising the conversion right. The Company will keep available authorized shares reserved, initially 1,730,000 shares, but in any event the number of reserved shares at least equals 400% of the number of shares of Company common stock issuable upon conversion of the Note. During the year ended March 31, 2019 the holder of the note elected to convert $61,425 of principal and accrued interest into common stock. The dates, shares issued and principal amounts repaid at each conversion event are as follows: Conversion Date Principal Outstanding Principal Reduction Shares Issued Exercise Price 12/31/2018 135,000 2/04/2019 $120,000 $(15,000) 808,303 $0.0195 03/01/2019 $111,500 $(8,500) 921,451 $0.00975 03/21/2019 $99,000 $(12,500) 2,876,192 $0.004615 03/29/2019 $77,000 $(22,000) 5,218,503 $0.004485 The valuation of the derivative liability related to the $135,000 borrowing on the First Note and with an intrinsic value of $0.54 per share is approximately $248,386 using a binomial pricing model. That amount is recorded as a contra-note payable amount (similar to the recorded OID and transaction costs), but only for an amount not in excess of and thus capped by the otherwise undiscounted amount of the note payable. The amount of the derivative liability formally recorded is $126,500 ($135,000 net of $8,500) and will be amortized as interest expense over the life of the loan. The remaining $121,886 is expensed as financing fees. During the year ended March 31, 2019, $9,326 of regular interest, $4,029 of original issue discount, and $91,149 of derivative liability was expensed. On July 17, 2018 (transaction documents were originally dated June 29, but amended for action taken on July 17), IronClad issued a 12% convertible note (the Convertible Note) to a lender (the Holder) in an aggregate principal amount of $115,500. The Company received cash proceeds of $101,500 net of transaction costs of $14,000 that included $3,500 for attorneys fees. The note matures on July 18, 2019. Interest costs accrue on the unpaid principal balance at 12% annually until maturity, and after that if not paid, interest accrues annually at 18% until any unpaid principal amount and unpaid interest accrued are paid. The Holder of the note, at its sole election, may convert the note into shares of common stock of the Company at any time during the period beginning on the date which is one hundred and eighty days following the date of the note (dated July 18, 2018) and ending on the later of i) the maturity date, or ii) the date of payment of a default amount, if any. The shares to be issued upon conversion are a function of a variable conversion price which is 65% of a market price defined to be the lowest one (1) trading price for the Companys common stock during the fifteen (15) day trading period ending on the last trading day prior to the conversion date. The Company will keep available authorized shares reserved, initially 1,500,000 shares. During the year ended March 31, 2019 the holder of the note elected to convert $111,500 of principal and $4,000 of financing fees into 11,628,751 shares of Class A common stock. The dates, shares issued and principal amounts repaid at each conversion event are as follows: Conversion Date Principal Outstanding Principal Reduction Shares Issued Exercise Price 12/31/2018 115,500 01/22/2019 $106,500 $(9,000) 97,371 $0.097565 02/4/2019 $91,500 $(15,000) 794,872 $0.0195 02/12/2019 $77,000 $(14,500) 769,231 $0.0195 02/20/2019 $57,500 $(19,500) 1,025,642 $0.0195 02/28/2019 $42,500 $ |
Note 6. Share Exchange Agreemen
Note 6. Share Exchange Agreement | 12 Months Ended |
Mar. 31, 2019 | |
Notes | |
Note 6. Share Exchange Agreement | Note 6. Share Exchange Agreement On January 6, 2017, the Company entered into a Share Exchange Agreement with InterLok Key Management, Inc. wherein Butte agreed to issue 56,655,891 restricted shares of Buttes common stock in exchange for 100% of the outstanding shares of InterLok Key Management, Inc. common stock. InterLok Key Management, Inc. is engaged in the business of developing and licensing its patented key-based encryption methods. On January 6, 2017, Butte completed its Share Exchange Agreement with the owners of InterLok and issued 56,655,891 restricted shares of Buttes common stock to 29 persons and entities in exchange for all of the outstanding shares of InterLok Key Management, Inc.s common stock. Immediately following completion of the share exchange agreement, the Companys new board of directors elected, through a series of board resolutions and regulatory filings, to change the Companys name to IronClad Encryption Corporation from Butte, to move the Company to Nevada from Delaware, and to change its stock trading symbol to IRNC from BTHI. The Share Exchange was treated as a reverse merger with InterLok Key Management, Inc. deemed, for accounting recognition purposes, the accounting acquirer and Butte Highlands Mining Company deemed the accounting acquiree under the acquisition method of accounting. The reverse merger is deemed a recapitalization and the unaudited pro forma consolidated financial statements of operations represent the substantive continuation of the operations and thus the financial statements of InterLok Key Management, Inc., while the capital structure (with respect to authorized, issued and outstanding shares of preferred and common stock) of Butte Highlands Mining Companynow using the name IronCladremains intact. |
Note 7. Common Stock
Note 7. Common Stock | 12 Months Ended |
Mar. 31, 2019 | |
Notes | |
Note 7. Common Stock | Note 7. Common Stock During the three-month period ended March 31, 2017, i) the Company issued 5,843,954 shares of its Class A common stock at $0.15 per share for cash in the amount of $876,597 ($35,343 of which was only subscribed and still receivable at December 31, 2016), and ii) 75,000 shares at $0.15 per share for investment banking services in the amount of $11,250. Additionally, i) the three convertible note holders elected to convert their $210,000 of notes into 1,400,000 shares of Class A common stock at $0.15 per share, and ii) 250,000 shares were issued pursuant to the Share Exchange Agreement at $0.03 per share. Also, iii) subscriptions receivable that were outstanding at December 31, 2016 in the amount of $81,481 were collected. During the three-month period ended June 30, 2017, the Company issued i) 240,333 shares of Class A common stock at $0.15 per share for cash in the amount of $36,050 pursuant to a Section 4(a)2 private placement offering, ii) 25,000 shares at $0.15 per share for the conversion of stock options (see Note 8), and iii) 75,000 shares at $2.90 per share for investment banking services valued at $217,500. During the three-month period ended September 30, 2017, the Company issued i) 100,000 shares of Class A common stock at $3.49 per share for consulting services in the amount of $349,000 and ii) 37,500 shares at $3.50 per share for investment banking services valued at $131,250. During the three-month period ended December 31, 2017, the Company issued 157,500 shares of Class A common stock at $4.10 per share to seven parties for consulting services in the amount of $660,750. On August 24, 2017 IronClad entered into an Investment Agreement for the potential future issuance and purchase of shares of its Class A common stock to establish an equity line of funding to IronClad. The agreement enables IronClad to issue stock to the counterparty of the agreement in exchange for cash amounts under certain defined conditions for the purchase of IronClads stock. In addition to the equity line, the agreement also included IronClad entering into the Commitment Note in the principal amount of $100,000 to finance the commitment fee of the Investment Agreement and the Convertible Note to borrow up to $330,000 (of which $165,000 was borrowed on August 24, 2017 and a subsequent $82,500 was borrowed on October 23, 2017). See Notes 5 and 14. On January 24, 2018 IronClad issued, under the terms of the Investment Agreement, 14,331 shares of its Class A stock in exchange for receipts totaling $25,823 ($1.80 per share) from the counterparty of the Investment Agreement. Similarly, on February 16, 2018 24,265 shares were issued in exchange for proceeds of $38,824 ($1.60 per share). On March 26, 2018 9,958 shares of Class A common stock were issued for the conversion of $10,000 of the $165,000 referred to above. On January 23, 2018, the Company issued 10,000 shares of its Class A common stock at $2.25 per share to two advisors for services in the amount of about $22,500. On March 13, 2018, the Company approved the issuance of 100,000 shares of its Class A common stock at $1.85 per share to five parties for services in the amount of about $185,000, at March 31, 2018, 55,000 shares were as yet unissued but were issued in the subsequent quarter. During the period ended March 31, 2018, the Company approved for issue a total of 50,322 shares of Class A common stock, priced between $1.40 and $1.82, for the complete conversion of a convertible note, at March 31, 2018 13,030 were as yet unissued and are disclosed on the balance sheet as Shares to be Issued. At the March 31, 2018 year end, there were 55,000 shares of Class A common stock that were recorded and reported as to be issued, those shares were issued during the three month period ended June 30, 2018. During the three month period ended September 30, 2018, the Company approved for issuance 2,000 shares of Class A common stock priced at $0.45 for services of $900; 140,000 share of Class A common stock for the exercise of stock options priced at $0.15 per share for cash in the amount of $21,000; 61,538 shares of Class A common stock priced at $0.325 for conversion of $20,000 of convertible debt; 73,260 shares of Class A common stock priced at $0.1365 for conversion of $10,000 of convertible debt; 236,686 shares of Class A common stock priced at $0.0845 for conversion of $20,000 of convertible debt. During the three month period ended December 31, 2018, the Company approved for issuance 50,000 shares of Class A common stock priced at $0.2 for accounts payable of $16,000; 1,210,654 shares of Class A common stock priced at $0.0826 for conversion of $100,000 of convertible debt. During the three month period ended March 31, 2019, the Company approved for issuance: · · · · · · · · · · · · · · · |
Note 8. Share Based Compensatio
Note 8. Share Based Compensation | 12 Months Ended |
Mar. 31, 2019 | |
Notes | |
Note 8. Share Based Compensation | Note 8. Share Based Compensation Equity Incentive Plan The Board of Directors adopted, and the Companys stockholders subsequently approved, the IronClad Encryption Corporation 2017 Equity Incentive Plan (the Plan) effective as of January 6, 2017. The purpose of the Plan is to foster and promote the long-term financial success of the Company and thereby increase stockholder value. The Plan provides for the award of equity incentives to certain employees, directors, or officers of, or key advisers or consultants to, the Company and its subsidiaries who are responsible for or contribute to the management, growth or success of the Company or any of its subsidiaries. The maximum number of shares available for issuance under the Plan is thirty million (30,000,000) shares of Class A common stock. On October 17, 2017, in connection with the change of the Companys jurisdiction of incorporation from the State of Nevada to the State of Delaware, the Board of Directors adopted the Amended and Restated IronClad Encryption Corporation 2017 Equity Incentive Plan (the Amended Plan). Additionally, from time to time, we issue non-compensatory warrants, such as warrants issued to investors. Restricted Stock The fair value of restricted stock awards classified as equity awards is based on the Companys stock price as of the date of grant. Such awards do not grant any rights as a shareholder of the company until a certificate for the vested shares of common stock has been issued. During the year ended December 31, 2017, 287,500 shares were granted for services, none were forfeited (none were issued prior to 2017). Expenses of $709,000 were recorded in connection with the stock issued as grants for services; $349,000 for business development and $360,000 for investor relations. Other stock grants were awarded for services, but the underlying stock was issued as unrestricted stock because it was otherwise registered under our S-8 and effective on November 28, 2017 and our S-1 as amended and effective on December 19, 2017. |
Note 9. Stock Options and Warra
Note 9. Stock Options and Warrants | 12 Months Ended |
Mar. 31, 2019 | |
Notes | |
Note 9. Stock Options and Warrants | Note 9. Stock Options and Warrants During the three-month period ended March 31, 2017, the Company awarded 1,045,000 stock options and warrants for services and conversions of convertible notes valued at $1,305,565 and 9,000,000 stock options to officers of IronClad valued at $622,045. Of the total 10,145,000 options and warrants awarded, 1,045,000 vested immediately and received full expense recognition in the three-month period ended March 31, 2017. The remaining 9,883,470 options vest periodically over the subsequent three years and will be expensed on a straight line basis. During the three-month period ended June 30, 2017, the Company awarded 2,945,000 stock options for services valued at $4,657,850 (using the Black-Scholes option pricing model) and 500,000 stock options to an officer of IronClad valued at $731,659 (using the Black-Scholes option pricing model). Of the total 3,445,000 options recorded as awarded during the period 85,000 vested immediately and received full expense recognition during the three-month period ended June 30, 2017. The remaining 3,360,000 options vest periodically over the next two to four years and will be expensed on a straight line basis. During the three-month period ended September 30, 2017, the Company recorded the award of 372,500 stock options for services valued at $261,991 (using the Black-Scholes option pricing model) and 82,500 stock warrants for financing fees valued at $287,629 (using the Black-Scholes option pricing model). Of the total 455,000 options and warrants awarded during the period 155,000 vested immediately and received full expense recognition during the three-month period ended September 30, 2017. The remaining 300,000 options vest periodically over the next four years and will be expensed on a straight line basis. During the three-month period ended December 31, 2017, the Company recorded the award of 37,500 stock options for services valued at $161,921 (using the Black-Scholes option pricing model). All of the options vested immediately and received full expense recognition during the three-month period ended December 31, 2017. During the three-month period ended March 31, 2018, the Company awarded 2,700,000 stock options for services valued at $4,873,048 (using the Black-Scholes option pricing model) and 1,500,000 stock options to officers of IronClad valued at $2,700,000 (using the Black-Scholes option pricing model). Of the total 4,200,000 options recorded as awarded during the period 50,000 vested immediately and received full expense recognition during the three-month period ended March 31, 2018. The remaining 4,150,000 options vest periodically over the next three to seven years and will be expensed on a straight line basis. During the three-month period ended June 30, 2018 the Company awarded 122,500 stock options and warrants for services value at $123,719. All options and warrants awarded vested in the period and received full expense recognition. During the three-month period ended December 31, 2018 the Company awarded 700,195 stock options and warrants for services value at $137,058. Of the 700,195 options and warrants awarded, 200,195 vested during the period and received full expense recognition, the remaining 500,000 options vest during subsequent quarters and will be expensed at that time. During the three-month period ended March 31, 2019 the Company awarded 100,000 stock options and warrants for services valued at $31,994. All options and warrants awarded vested in the period and received full expense recognition. Of the $292,771 in option expense for the year ended March 31, 2019 above, $50,000 remains to be expensed as they vest. The fair value of stock options and warrants is estimated on the date of each award using the Black-Scholes option pricing model to value the stock option or warrant based on its terms and conditions. There was one exercise of 25,000 options during 2017. The tables below summarize the assumptions used to estimate the fair values of the options and warrants at March 31, 2019: Number of Options* Date Issued Exercise Price Risk-free Interest Rate Volatility Life of Options in Years Vested Options* 75,000 01/16/17 $0.75 1.54% 226.01% 3.00 75,000 6,000,000 01/20/17 $0.15 1.54% 220.00% 3.00 3,000,000 3,000,000 01/20/17 $0.15 1.54% 220.00% 4.00 2,000,000 350,000 01/31/17 $0.15 1.19% 132.84% 1.93 350,000 100,000 02/01/17 $0.15 1.22% 134.90% 2.00 100,000 100,000 03/13/17 $0.15 1.40% 144.84% 2.00 100,000 20,000 03/21/17 $0.15 1.54% 233.07% 3.00 20,000 5,000 04/30/17 $0.75 1.45% 219.35% 3.00 5,000 1,700,000 05/05/17 $1.47 1.71% 565.34% 4.00 850,000 1,000,000 05/05/17 $1.47 1.32% 202.99% 2.00 1,000,000 80,000 05/31/17 $0.75 1.44% 196.06% 3.00 80,000 660,000 06/12/17 $2.50 1.64% 589.85% 4.00 230,000 5,000 06/30/17 $3.49 1.55% 197.13% 3.00 5,000 300,000 07/26/17 $3.16 1.63% 296.38% 4.00 150,000 5,000 07/31/17 $3.50 1.51% 170.61% 3.00 5,000 37,500 08/25/17 $2.50 1.62% 170.38% 3.00 37,500 25,000 08/31/17 $3.75 1.44% 170.57% 3.00 25,000 37,500 10/26/17 $4.50 1.76% 220.28% 3.00 37,500 25,000 01/25/18 $2.70 2.20% 247.35% 3.00 25,000 25,000 03/02/18 $1.80 2.52% 297.39% 3.84 25,000 400,000 03/02/18 $1.80 2.71% 369.15% 5.84 134,000 3,400,000 03/02/18 $1.80 2.79% 369.05% 6.84 1,601,000 350,000 03/02/18 $1.80 2.79% 395.11% 7.84 116,667 20,000 04/02/18 $1.69 2.55% 372.73% 4.75 20,000 20,000 05/01/18 $1.20 2.82% 365.73% 4.67 20,000 20,000 06/06/18 $1.14 2.81% 312.26% 4.57 20,000 270,000 10/11/18 $0.32 2.97% 361.56% 2.97 270,000 500,000 12/19/18 $0.15 2.62% 488.82% 6.4 166,667 18,530,000 Issued Vested 10,468,334 (25,000) Exercised Exercised (25,000) (1,050,000) Forfeited Forfeited (450,000) 17,455,000 Unexercised Unexercised 9,993,334 Number of Warrants Date Issued Exercise Price Risk-free Interest Rate Volatility Life of Warrants in Years Vested Warrants 500,000 03/15/17 $0.15 1.02% 114.94% 1.40 500,000 82,500 08/24/17 $3.50 1.63% 285.16% 4.00 82,500 62,500 06/06/18 $3.00 2.69% 311.00% 4.00 62,500 30,195 10/26/2018 $3.00 2.44 263.28% 5.00 30,195 675,195 Issued 675,195 (193,559) Exercised (193,559) (368,941) Forfeited (368,941) 112,695 Outstanding 112,695 Options* and Warrants Options and Warrants 19,205,195 Issued Vested 11,143,529 (218,559) Exercised Exercised (218,559) (1,418,941) Forfeited Forfeited (818,941) 17,567,695 Outstanding Unexercised 10,106,029 * The number of outstanding options above does not include an option awarded to the Companys President to purchase 10,000,000 shares of Class A common stock at an exercise price of $1.00 per share. The option is only exercisable under certain limited circumstances, one of which is that the market price of the Class A common stock reaches a price of $15.00 per share. Once vested, these additional options must be exercised within two years of vesting. The number of options and warrants including these 10,000,000 options totals 24,045,000. On April 11, 2017 an independent company advisor exercised options for 25,000 shares of Class A common stock for $3,750 in cash. On August 14, 2018 a debt holder exercised warrants for 140,000 shares of Class A common stock for $21,000 in cash. On March 1, 2019 a debt holder exercised warrants for 7,474,770 shares of Class A common stock on a cashless exercise that resulted in a trigger to a down round feature and the recognition of a reduction of retained earnings of $121,011. During the year ended March 31, 2019 1,410,000 options and warrants were forfeited, 810,000 as a result of expiration, 600,000 due to employee termination, and 8,941 due to other causes. Of the 1,410,000 options and warrants that were forfeited, 600,000 had not previously vested. |
Note 10. Income Taxes
Note 10. Income Taxes | 12 Months Ended |
Mar. 31, 2019 | |
Notes | |
Note 10. Income Taxes | Note 10. Income Taxes Federal Income taxes are not currently due since IronClad has had losses since inception. Income taxes are provided based upon the liability method of accounting pursuant to ASC 740-10-25 Income Taxes Recognition. Deferred income tax amounts reflect the net tax effects of temporary differences between the carrying amounts of assets and liabilities for financial reporting purposes and the amounts used for income tax reporting purposes. Significant components of the deferred tax asset amounts at an anticipated tax rate of 21% for the period ended March 31, 2019 and March 31, 2018 are as follows: March 31, 2019 March 31, 2018 Net operating losses carryforwards $ 3,872,481 $ 2,726,760 Deferred tax asset 813,221 572,619 Valuation allowance for deferred asset (813,221) (572,619) Net deferred tax asset $ - $ - At March 31, 2019, the Company has net operating loss carryforwards of approximately $3,872,481 which will begin to expire in the year 2033. The increase in the allowance account amount (and also in the deferred tax asset amount) from March 31, 2018 to March 31, 2019 was $240,602. On December 22, 2017 H.R. 1, originally known as the Tax Cuts and Jobs Act, (the Tax Act) was enacted. Among the significant changes to the U.S. Internal Revenue Code, the Tax Act lowers the U.S. federal corporate income tax rate (Federal Tax Rate) from 35% to 21% effective January 1, 2018. The Company will compute its income tax expense for the December 31, 2017 fiscal year using a Federal Tax Rate of 21%. In December 2017, the Securities and Exchange Commission staff issued Staff Accounting Bulletin No. 118, which addresses how a company recognizes provisional amounts when a company does not have the necessary information available, prepared or analyzed (including computations) in reasonable detail to complete its accounting for the effect of the changes in the Tax Act. The measurement period ends when a company has obtained, prepared and analyzed the information necessary to finalize its accounting, but cannot extend beyond one year. IronClad is subject to federal level income taxes under the jurisdiction of the US, but is not subject to income taxes at any state level except for the State of Virginia. Tax periods that may still be subject to review by the Internal Revenue Service are the years 2016, 2017, and 2018. The Company has not identified any aggressive tax positions. |
Note 11 - Related Party Transac
Note 11 - Related Party Transactions | 12 Months Ended |
Mar. 31, 2019 | |
Notes | |
Note 11 - Related Party Transactions | Note 11 Related Party Transactions At March 31, 2019 the Company owed approximately $96,506 in accounts payable to management and related parties. At March 31, 2018 the Company owed approximately $104,542 in accounts payable to management and related parties. During the year ended March 31, 2018, IronClad entered into a loan agreement to borrow up to $500,000 shares at 8.5% interest. The Company has borrowed the full amount of the loan. The Company has pledged 500,000 of its common stock as collateral under the terms of the Agreement. In the event of default by the Company, the lender is entitled to receive one share of Company common stock for every one dollar in principle, interest, penalties, and fees that are owed and outstanding by the Company to the lender. The Agreement is also supported by a personal $500,000 guarantee from the President of the Company. The Company will pay a 5% guarantee fee of $25,000; $10,000 shortly after year end and the remaining $15,000 at such time as the Board of Directors determines the Company has sufficient liquidity to pay the balance owed. The guarantee fee was reviewed and approved by the Compensation Committee of the Board which determined that the 5% fee was an appropriate market-based rate for guarantees of loans of this nature and comparable risk. See also Note 9 regarding stock option awards to management of the Company. |
Note 12. General and Administra
Note 12. General and Administrative Expenses | 12 Months Ended |
Mar. 31, 2019 | |
Notes | |
Note 12. General and Administrative Expenses | Note 12. General and Administrative Expenses General and administrative expenses recognized for the year ended March 31, 2019 were $2,528,688 of which $1,993,242 were recognized as compensation expenses in connection with the issuance of stock options or warrants; an additional $13,509 of expense was recognized as a result of issuing stock for consulting services ($12,609 which were recorded as professional fees). General and administrative expenses recognized for the year ended March 31, 2018 were $2,365,482 of which $959,214 were recognized as compensation expenses in connection with the issuance of stock options or warrants; an additional $88,695 of expense was recognized as a result of issuing stock for consulting services. |
Note 13. Accounts Receivable an
Note 13. Accounts Receivable and Revenue | 12 Months Ended |
Mar. 31, 2019 | |
Notes | |
Note 13. Accounts Receivable and Revenue | Note 13. Accounts Receivable and Revenue Customer Service: Information Center During the year ended March 31, 2018, IronClad formed a new wholly-owned subsidiary, Ironclad Pipeline IC, Inc. which began generating a modest level of revenue through a moderately profitable service contract with a major energy company in the eastern United States. The services are to provide an array of services in support of an infrastructure project. The $0 and $301,978 of receivables at March 31, 2019 and 2018 is for $229,745 of services rendered and the balance is for reimbursable costs incurred, approved by the customer, billed (and paid promptly subsequent to March 31, 2018). Payment terms are for payment to be made within 30 days; the receivables were collected well within that period. There were no billings subsequent to July 31, 2018. In mid-July 2018 our customer notified the Company of its intent to exercise an option in its contract to end our services under the contract. Consequently, our services were discontinued effective July 28, 2018. Revenue earned and invoiced through July 28, 2018 was $200,975. The customer also elected to retain the services of the individuals previously employed by IronClad Pipeline IC, Inc. on a going forward basis. All invoiced amounts that were billed for services under the contract through the end-date of the contract were submitted, approved and paid promptly and in full by the customer. Nor further services will be provided to this customer and thus no further revenue will be earned from this customer in the foreseeable future. |
Note 14. Commitments and Contin
Note 14. Commitments and Contingencies | 12 Months Ended |
Mar. 31, 2019 | |
Notes | |
Note 14. Commitments and Contingencies | Note 14. Commitments and Contingencies Subsequent to year end, complaints were filed against the Company by two contractors requesting disputed compensation. We are answering these claims, and will defend ourselves within our legal rights. We lease office space on a month-to-month basis. The annual cost is less than $17,000. We have no other leases or rental agreements. |
Note 15. Subsequent Events
Note 15. Subsequent Events | 12 Months Ended |
Mar. 31, 2019 | |
Notes | |
Note 15. Subsequent Events | Note 15. Subsequent Events Convertible Notes On April 12, 2019 IronClad entered into a Securities Purchase Agreement (SPA) to issue a 8% convertible note payable for an aggregate principal amount of $86,400 comprised of the first note (First Note) being in the amount of $43,200, and the remaining note in the amount of $43,200, (a Back End Note). The Company received cash proceeds of $38,000 from the First Note net of transaction costs of $5,200. The $5,200 is recorded as a discount amount on the note payable and will be amortized as interest expenses over the life of the note. The First Note matures on April 12, 2020 and interest costs accrue on the unpaid principal balance at 8% annually until February 14, 2020, and after that if not paid at maturity interest accrues annually at 24% until the principal amount and all interest accrued and unpaid are paid. The Back End Note carries the same terms as the First Note, except it may not be repaid, but only converted. The Company is under no obligation to accept the Back End Note, but may do so at its sole discretion, following 180 days from the date of the note (dated April 12, 2019). As part of the SPA, the Holder issued the Company a collateralized secured promissory note in the amount of $40,000 that may be exchanged for cash against the Back End Note. The holder of the note, at its sole election, may convert the note into shares of common stock of the Company at any time during the period beginning on the date which is 180 days following the date of the note (dated July 11, 2018) and ending on the later of i) the maturity date, or ii) the date of payment of a default amount, if any. The shares to be issued are a function of a fixed conversion price of $0.50 per share for six months, and thereafter until maturity at a variable conversion price which is 65% of a market price defined to be the lowest trading price for the Companys common stock during the fifteen day trading period ending on the last trading day prior to the conversion date. The Company will keep available authorized shares reserved, initially 2,100,000 shares. The conversion feature of the note represents an embedded derivative. The valuation of the derivative liability related to the $43,200 borrowing with an intrinsic value of $.0076 per share is approximately $76,531 using a binomial pricing model. That amount is recorded as a contra-note payable amount (similar to the recorded OID and transaction costs), but only for an amount not in excess of and thus capped by the otherwise undiscounted amount of the note payable. The amount of the derivative liability formally recorded is $38,000 ($43,200 net of $5,200) and will be amortized as interest expense over the life of the loan. The remaining $38,531 is expensed as financing fees. On April 23, 2019 IronClad entered into a Securities Purchase Agreement to issue a 12% convertible note payable for an aggregate principal amount of $57,750. The Company received cash proceeds of $50,000 net of transaction costs of $7,750. The $7,750 is recorded as a discount amount on the note payable and will be amortized as interest expenses over the life of the note. The note matures on April 23, 2020. Interest costs accrue on the unpaid principal balance at 12% annually until maturity, and after that if not paid, interest accrues annually at 18% until any unpaid principal amount and unpaid interest accrued are paid. The Holder of the note, at its sole election, may convert the note into shares of common stock of the Company after the six month anniversary of the note; the conversion price shall be equal to 65% of the lowest trading price for the fifteen prior trading days including the day upon which a notice of conversion is received. The conversion feature of the note represents an embedded derivative. The valuation of the derivative liability related to the $57,750 borrowing on the Convertible Note and with an intrinsic value of $.025 per share is approximately $317,308 using a binomial pricing model. That amount is recorded as a contra-note payable amount (similar to the recorded OID and transaction costs), but only for an amount not in excess of and thus capped by the otherwise undiscounted amount of the note payable. The amount of the derivative liability formally recorded is $50,000 ($57,750 net of $7,750) and will be amortized as interest expense over the life of the loan. The remaining $267,308 is expensed as financing fees. On May 15, 2019 IronClad entered into a Securities Purchase Agreement to issue a 10% convertible note payable for an aggregate principal amount of $150,000. The Company received cash proceeds of $142,500 net of transaction costs of $7,500. The $7,500 is recorded as a discount amount on the note payable and will be amortized as interest expenses over the life of the note. The note matures on May 15, 2020 and interest costs accrue on the unpaid principal balance at 10% annually until May 15, 2020, and after that if not paid at maturity interest accrues annually at up to 24% until the principal amount and all interest accrued and unpaid are paid. The Holder of the note is entitled, at any time after cash payment, to convert all or any amount of the principal face amount of the Note then outstanding into shares of the Company's common stock. The shares to be issued upon conversion are a function of a variable conversion price which is 65% of a market price defined to be the lowest trading price for the Companys common stock during the fifteen day trading period including the day upon which the notice of conversion is received conversion date. The Company will keep available authorized shares reserved, initially 61,538,000 shares. The valuation of the derivative liability related to the $150,000 borrowing with an intrinsic value of $0.0152 per share is approximately $407,871 using a binomial pricing model. That amount is recorded as a contra-note payable amount (similar to the transaction costs), but only for an amount not in excess of and thus capped by the otherwise undiscounted amount of the note payable. The amount of the derivative liability formally recorded is $142,500 ($150,000 net of $7,500) and will be amortized as interest expense over the life of the loan. The remaining $265,371 is expensed as financing fees. Subsequent to year end 161,707,754 shares of Class A common stock were issued to repay $432,842 of principal balances of convertible notes. Preferred Stock, Series A On April 12, 2019, the Board of Directors (the Board) ratified the amendment of the Companys Certificate of Incorporation, effective as of April 3, 2019, upon filing a Certificate of Designation with the Secretary of State of Delaware, which sets forth the rights, preferences and privileges of the Series A Preferred Stock. The Board also approved the issuance of 100 shares of Series A Preferred Stock with a stated value of $0.001 per share for no consideration to the Companys President pursuant to Rule 4(a)(2) under the Securities Act of 1933, as amended (the Securities Act) and Rule 506 of Regulation D as promulgated by the SEC under the Securities Act. Except as otherwise required by law or by the Certificate of Incorporation, or by the Certificate of Designation, the outstanding shares of Series A Preferred Stock shall vote together with the shares of Common Stock and other voting securities of the Company as a single class and, regardless of the number of shares of Series A Preferred Stock outstanding and as long as at least one of such shares of Series A Preferred Stock is outstanding, shall represent eighty percent (80%) of all votes entitled to be voted at any annual or special meeting of shareholders of the Company or action by written consent of shareholders. Each outstanding share of the Series A Preferred Stock shall represent its proportionate share of the 80% which is allocated to the outstanding shares of Series A Preferred Stock. The shares of the Series A Preferred Stock are not convertible into Common Stock of the Company. The holder of the shares will not be entitled to receive any dividends. Complaints by Suppliers Subsequent to year end, two separate complaints were filed against the Company by two contractors requesting disputed compensation . We are answering these claims, and will defend ourselves within all our available legal rights. However, the Company and its counsel are unable to estimate or evaluate the likelihood of each outcome with any degree of certainty. See the Commitments and Contingencies footnote above. |
Note 1. Organization, Recent _2
Note 1. Organization, Recent History, and Description of Businesses-Present and Past: History and Recent Transaction (Policies) | 12 Months Ended |
Mar. 31, 2019 | |
Policies | |
History and Recent Transaction | History and Reverse Merger in January of 2017 The Company is the term used in these statements and notes to refer to the entity originally incorporated in the State of Delaware in 1929. The registered name of the Company until early in 2017 was Butte Highlands Mining Company (Butte). Butte was formed to explore and mine primarily for gold in the Butte Highlands Only Chance mine, south of Butte, Montana. Butte ceased operating as a mining company in 1942. The Company was reorganized in October 1996 for the purpose of acquiring and developing additional mineral properties. At the time of the 1996 reorganization, stockholders representing approximately 76% of the outstanding capital stock could not be located. In order to obtain the quorum necessary for the special meetings of shareholders to authorize the reorganization, Butte obtained an order from the Superior Court of Spokane County, Washington appointing a trustee for the benefit of those stockholders who could not be located. By May 17, 2007, eleven years after the reorganization and very limited results from its mining activities, the Company had disposed of all of its historical mineral properties or mining claims and eventually became a shell company under the rules of the Securities and Exchange Commission (SEC). In 2009, Butte registered under the Securities Exchange Act of 1934, as amended, for the purpose of becoming a reporting company. The Companys common stock then became listed on the OTCBB, but in time the Company also listed its common stock to trade on the OTC QB electronic market, one of the OTC Markets Group over-the-counter markets, where the Companys common stock is listed. Then, following ten years of being a shell company with only nominal activity and limited cash or other assets, the business focus of Butte changed early in 2017. Most notably the Company raised significant capital to implement its new business and financial plans to further develop the licensing and commercial use of its patented encryption software. The change caused Butte to lose its previous shell company status. The Company also changed its state of incorporation to Nevada and its name to IronClad Encryption Corporation (IronClad) and changed the stock symbol from BTHI to IRNC to more appropriately reflect the fundamental change of its business to developing cyber encryption technology and away from its historical mining activities. On October 16, 2017, the Company redomiciled in Delaware from Nevada and adopted a certificate of incorporation and bylaws as a Delaware corporation. The terms Company, IronClad and Butte all refer to the same individual corporate entity, but the uses of the IronClad and Butte names are used to refer to different eras of the Companys long history. The historical eras generally coincide with the changes in business focus before and after the first weeks of 2017. The business changes are a result of a common stock exchange transaction, accounted for as a reverse merger, between Butte and the owners of InterLok Key Management, Inc. (InterLok; at the time an independent and privately-held Texas corporation) whereby InterLok became a wholly-owned subsidiary of Butte. Butte issued shares of its common stock in exchange for acquiring all of the common stock of InterLok. Through December 31, 2017, InterLok was the only subsidiary of the Company and InterLoks patents and line of business now are the main basis of the business of the Company on a consolidated basis. During the year ended March 31, 2018, the Company incorporated a new wholly owned subsidiary IronClad Pipeline IC, Inc. (Pipeline). |
Note 1. Organization, Recent _3
Note 1. Organization, Recent History, and Description of Businesses-Present and Past: Principles of consolidation (Policies) | 12 Months Ended |
Mar. 31, 2019 | |
Policies | |
Principles of consolidation | Principles of consolidation The accompanying consolidated financial statements include the accounts of IronClad and its wholly-owned subsidiaries. All intercompany accounts and transactions have been eliminated in consolidation. The above consolidated financial statements have been prepared in accordance with generally accepted accounting principles. |
Note 2. Summary of Significan_2
Note 2. Summary of Significant Accounting Policies: Going Concern (Policies) | 12 Months Ended |
Mar. 31, 2019 | |
Policies | |
Going Concern | Going Concern As shown in the accompanying financial statements, the Company has incurred cumulative operating losses since inception. As of March 31, 2019, the Company has limited financial resources with which to achieve its objectives and attain profitability and positive cash flows from operations. As shown in the accompanying balance sheets and statements of operations, the Company has an accumulated deficit of $27,967,566. The Company's working capital deficit is $5,403,654, (current assets minus current liabilities; current liabilities in this case being greater than current assets). Achievement of the Company's objectives will depend on its ability to obtain additional financing, to generate revenue from current and planned business operations, and to effectively manage product and software development, operating and capital costs. The Company is in a development stage and has generated no operating revenue, profits or positive cash flows from operations. The Company plans to fund its future operations by potential sales of its common stock or by issuing debt securities. However, there is no assurance that IronClad will be able to achieve these objectives, therefore substantial doubt about its ability to continue as a going concern exists. The financial statements do not include adjustments relating to the recoverability of recorded assets nor the implication of associated bankruptcy costs should IronClad be unable to continue as a going concern. |
Note 2. Summary of Significan_3
Note 2. Summary of Significant Accounting Policies: Revenue Recognition and Trade Accounts Receivable (Policies) | 12 Months Ended |
Mar. 31, 2019 | |
Policies | |
Revenue Recognition and Trade Accounts Receivable | Revenue Recognition and Trade Accounts Receivable The Company recognizes revenue in accordance with ASC 606 Revenue From Contracts With Customers We record trade accounts receivable at net realizable value. This value includes an appropriate allowance for estimated uncollectible accounts, if any, to reflect any loss anticipated on the trade accounts receivable balances and charged to the provision for doubtful accounts. |
Note 2. Summary of Significan_4
Note 2. Summary of Significant Accounting Policies: Earnings (Losses) Per Share (Policies) | 12 Months Ended |
Mar. 31, 2019 | |
Policies | |
Earnings (Losses) Per Share | Earnings (Losses) Per Share Basic earnings per share are computed by dividing net income (loss) by the weighted-average number of common shares outstanding during the year. Fully-diluted earnings per share is computed by dividing net income (loss) by the sum of the weighted-average number of common shares outstanding and the additional common shares that would have been outstanding if potential common shares had been issued. Potential common shares are not included in the computation of fully diluted earnings per share if their effect is anti-dilutive. |
Note 2. Summary of Significan_5
Note 2. Summary of Significant Accounting Policies: Cash Equivalents (Policies) | 12 Months Ended |
Mar. 31, 2019 | |
Policies | |
Cash Equivalents | Cash Equivalents The Company considers cash, certificates of deposit, and debt instruments with a maturity of three months or less when purchased to be cash equivalents. |
Note 2. Summary of Significan_6
Note 2. Summary of Significant Accounting Policies: Fair Value Measures (Policies) | 12 Months Ended |
Mar. 31, 2019 | |
Policies | |
Fair Value Measures | Fair Value Measures The Company's financial instruments, as defined by the Financial Accounting Standards Boards Accounting Standards Codification (ASC) 825-10-50 Financial InstrumentsOverall (and subtopics) The standards under ASC 820 Fair Value Measurement · · · At March 31, 2019 and 2018 the Company did not have any assets measured at fair value other than cash and deposits. At March 31, 2019 and 2018 the Company had conversion features embedded in its convertible notes payable. The fair value measurement of those derivatives, using a Binomial valuation model, was $2,147,415 at March 31, 2019 and $234,138 at March 31, 2018 and is reported as derivative liability on the balance sheet. |
Note 2. Summary of Significan_7
Note 2. Summary of Significant Accounting Policies: Provision for Income Taxes (Policies) | 12 Months Ended |
Mar. 31, 2019 | |
Policies | |
Provision for Income Taxes | Provision for Income Taxes Income taxes are provided based upon the liability method of accounting pursuant to ASC 740-10-25 Income Taxes Recognition |
Note 2. Summary of Significan_8
Note 2. Summary of Significant Accounting Policies: Capitalization of Patent and Trademark Costs (Policies) | 12 Months Ended |
Mar. 31, 2019 | |
Policies | |
Capitalization of Patent and Trademark Costs | Capitalization of Patent and Trademark Costs The Company capitalizes its legal, patent agent and related filing fees and costs associated with the patents it holds and is developing. The amounts are carried as an intangible asset in the financial statements. The costs of the patents or trademarks are amortized ratably (expensed) over the expected useful technological or economic life of the individual assets, which the Company has determined to be ten years. The legal life of a patent is typically about 20 years. See Note 3. |
Note 2. Summary of Significan_9
Note 2. Summary of Significant Accounting Policies: Reclassification of Prior Year Presentation (Policies) | 12 Months Ended |
Mar. 31, 2019 | |
Policies | |
Reclassification of Prior Year Presentation | Reclassification of Prior Year Presentation Certain prior year amounts have been reclassified to provide greater line item detail for consistency with the current period presentation. These reclassifications had no effect on the reported results of operations. This change in classification has no effect on previously reported cash flows in the Condensed Consolidated Statement of Cash Flows and had no effect on the previously reported Condensed Consolidated Statements of Operations for any period |
Note 2. Summary of Significa_10
Note 2. Summary of Significant Accounting Policies: New Accounting Requirements and Disclosures (Policies) | 12 Months Ended |
Mar. 31, 2019 | |
Policies | |
New Accounting Requirements and Disclosures | New Accounting Requirements and Disclosures Accounting standards that have been issued or proposed by FASB that do not require adoption until a future date are not expected to have a material impact on the consolidated financial statements upon adoption. The Company does not discuss recent pronouncements that are not anticipated to have an impact on or are unrelated to its financial condition, results of operations, cash flows or disclosures. FASB issued standard ASU 2018-07 CompensationStock Compensation (Topic 718): Improvements to Nonemployee Share-Based Payment Accounting FASB issued standard ASU 2017-11 Earnings Per Share (Topic 260); Distinguishing Liabilities from Equity (Topic 480); Derivatives and Hedging (Topic 815): (Part I) Accounting for Certain Financial Instruments with Down Round Features, (Part II) Replacement of the Indefinite Deferral for Mandatorily Redeemable Financial Instruments of Certain Nonpublic Entities and Certain Mandatorily Redeemable Noncontrolling Interests with a Scope Exception. FASB issued ASU No. 2016-02, Leases |
Note 2. Summary of Significa_11
Note 2. Summary of Significant Accounting Policies: Use of Estimates (Policies) | 12 Months Ended |
Mar. 31, 2019 | |
Policies | |
Use of Estimates | Use of Estimates The preparation of the consolidated financial statements in conformity with accounting principles generally accepted in the United States requires management to make estimates and assumptions that affect the reported amounts of assets, liabilities and expenses at the balance sheet date and for the period then ended. We believe our estimates and assumptions are reasonable; however, such estimates and assumptions are subject to a number of risks and uncertainties that may cause actual results to differ materially from such estimates. Significant estimates and assumptions underlying these financial statements include: · · · · We are subject to claims and liabilities that arise in the ordinary course of business. We accrue for losses when such losses are considered probable and the amounts can be reasonably estimated. |
Note 3. Patents_ Schedule of Pa
Note 3. Patents: Schedule of Patents and Trademarks (Tables) | 12 Months Ended |
Mar. 31, 2019 | |
Tables/Schedules | |
Schedule of Patents and Trademarks | March 31, 2019 March 31, 2018 Patents and trademarks under development $ 217,744 $ 170,946 Patents issued 153,801 398 Less accumulated amortization (3,759) (368) 150,042 30 Patents, net $ 367,786 $ 170,976 |
Note 5. Notes Payable_ Schedule
Note 5. Notes Payable: Schedule of dates, shares issued and principal amounts repaid (Tables) | 12 Months Ended |
Mar. 31, 2019 | |
2017 Convertible Note 12% | |
Schedule of dates, shares issued and principal amounts repaid | Conversion Date Principal Outstanding Principal Reduction Shares Issued Exercise Price 12/31/2017 $78,500 1/10/2018 $63,500 $(15,000) 8,242 $1.82 1/12/2018 $43,500 $(20,000) 10,989 $1.82 1/18/2018 $28,500 $(15,000) 8,242 $1.82 1/23/2018 $13,500 $(15,000) 9,819 $1.53 1/25/2018 $ $(13,500) 13,030 $1.40 Total 50,322 |
Commitment Note and Convertible Note | |
Schedule of dates, shares issued and principal amounts repaid | Conversion Date Principal Outstanding Principal Reduction Shares Issued Exercise Price 12/31/2017 165,000 3/26/2018 $ 155,000 $(10,000) 9,958 $ 1.00425 06/01/18 $ 135,000 $(20,000) 32,219 $ 0.62 07/17/2018 $ 115,000 $(20,000) 61,538 $ 0.325 8/23/2018 $ 105,000 $(10,000) 73,260 $ 0.1365 09/14/18 $ 85,000 $(20,000) 236,686 $ 0.0845 02/06/19 $ 45,000 $(40,000) 2,051,282 $ 0.0195 02/25/19 $ - $(45,000) 2,123,643 $ 0.02119 Total 4,588,586 |
Commitment Note and Convertible Notes | |
Schedule of dates, shares issued and principal amounts repaid | Conversion Date Principal Outstanding Principal Reduction Shares Issued Exercise Price 12/31/18 82,500 3/14/2019 $77,500 $(5,000) 889,284 $.0056225 03/25/19 $53,500 $(24,000) 5,351,171 $0.004485 03/27/19 $49,500 $(4,000) 891,862 $0.004485 03/28/19 $45,500 $(4,000) 891,862 $0.004485 Total 8,024,179 |
2019 New Loan Agreements including Convertible Notes | |
Schedule of dates, shares issued and principal amounts repaid | Conversion Date Principal Outstanding Principal Reduction Shares Issued Exercise Price 12/31/2018 135,000 2/04/2019 $120,000 $(15,000) 808,303 $0.0195 03/01/2019 $111,500 $(8,500) 921,451 $0.00975 03/21/2019 $99,000 $(12,500) 2,876,192 $0.004615 03/29/2019 $77,000 $(22,000) 5,218,503 $0.004485 |
2019 New Loan Agreements including Convertible Note | |
Schedule of dates, shares issued and principal amounts repaid | Conversion Date Principal Outstanding Principal Reduction Shares Issued Exercise Price 12/31/2018 115,500 01/22/2019 $106,500 $(9,000) 97,371 $0.097565 02/4/2019 $91,500 $(15,000) 794,872 $0.0195 02/12/2019 $77,000 $(14,500) 769,231 $0.0195 02/20/2019 $57,500 $(19,500) 1,025,642 $0.0195 02/28/2019 $42,500 $(15,000) 1,402,715 $0.01105 03/11/2019 $30,000 $(12,500) 2,105,264 $0.006175 03/14/2019 $17,500 $(12,500) 2,312,139 $0.0056225 03/26/2019 $4,000 $(13,500) 3,121,517 $0.004485 |
2019 New Loan Agreement including Convertible Note | |
Schedule of dates, shares issued and principal amounts repaid | Conversion Date Principal Outstanding Principal Reduction Shares Issued Exercise Price 12/31/2018 $157,500 01/24/2019 $147,500 $(10,000) 80,972 $0.1235 02/04/2019 $132,500 $(15,000) 769,231 $0.0195 02/07/2019 $115,000 $(17,500) 897,436 $0.0195 02/20/2019 $90,000 $(25,000) 1,282,051 $0.0195 02/27/2019 $75,000 $(15,000) 1,357,466 $0.01105 03/07/2019 $60,000 $(15,000) 1,923,077 $0.0078 03/13/2019 $45,000 $(15,000) 2,667,852 $0.0056225 03/25/2019 $35,000 $(10,000) 2,229,654 $0.04485 03/26/2019 $20,937 $(14,063) 3,135,563 $0.004485 03/29/2019 $1,000 $(19,937) 4,445,262 $0.004485 |
Note 9. Stock Options and War_2
Note 9. Stock Options and Warrants: Schedule of assumptions used to estimate the fair values of the options and warrants (Tables) | 12 Months Ended |
Mar. 31, 2019 | |
Tables/Schedules | |
Schedule of assumptions used to estimate the fair values of the options and warrants | Number of Options* Date Issued Exercise Price Risk-free Interest Rate Volatility Life of Options in Years Vested Options* 75,000 01/16/17 $0.75 1.54% 226.01% 3.00 75,000 6,000,000 01/20/17 $0.15 1.54% 220.00% 3.00 3,000,000 3,000,000 01/20/17 $0.15 1.54% 220.00% 4.00 2,000,000 350,000 01/31/17 $0.15 1.19% 132.84% 1.93 350,000 100,000 02/01/17 $0.15 1.22% 134.90% 2.00 100,000 100,000 03/13/17 $0.15 1.40% 144.84% 2.00 100,000 20,000 03/21/17 $0.15 1.54% 233.07% 3.00 20,000 5,000 04/30/17 $0.75 1.45% 219.35% 3.00 5,000 1,700,000 05/05/17 $1.47 1.71% 565.34% 4.00 850,000 1,000,000 05/05/17 $1.47 1.32% 202.99% 2.00 1,000,000 80,000 05/31/17 $0.75 1.44% 196.06% 3.00 80,000 660,000 06/12/17 $2.50 1.64% 589.85% 4.00 230,000 5,000 06/30/17 $3.49 1.55% 197.13% 3.00 5,000 300,000 07/26/17 $3.16 1.63% 296.38% 4.00 150,000 5,000 07/31/17 $3.50 1.51% 170.61% 3.00 5,000 37,500 08/25/17 $2.50 1.62% 170.38% 3.00 37,500 25,000 08/31/17 $3.75 1.44% 170.57% 3.00 25,000 37,500 10/26/17 $4.50 1.76% 220.28% 3.00 37,500 25,000 01/25/18 $2.70 2.20% 247.35% 3.00 25,000 25,000 03/02/18 $1.80 2.52% 297.39% 3.84 25,000 400,000 03/02/18 $1.80 2.71% 369.15% 5.84 134,000 3,400,000 03/02/18 $1.80 2.79% 369.05% 6.84 1,601,000 350,000 03/02/18 $1.80 2.79% 395.11% 7.84 116,667 20,000 04/02/18 $1.69 2.55% 372.73% 4.75 20,000 20,000 05/01/18 $1.20 2.82% 365.73% 4.67 20,000 20,000 06/06/18 $1.14 2.81% 312.26% 4.57 20,000 270,000 10/11/18 $0.32 2.97% 361.56% 2.97 270,000 500,000 12/19/18 $0.15 2.62% 488.82% 6.4 166,667 18,530,000 Issued Vested 10,468,334 (25,000) Exercised Exercised (25,000) (1,050,000) Forfeited Forfeited (450,000) 17,455,000 Unexercised Unexercised 9,993,334 Number of Warrants Date Issued Exercise Price Risk-free Interest Rate Volatility Life of Warrants in Years Vested Warrants 500,000 03/15/17 $0.15 1.02% 114.94% 1.40 500,000 82,500 08/24/17 $3.50 1.63% 285.16% 4.00 82,500 62,500 06/06/18 $3.00 2.69% 311.00% 4.00 62,500 30,195 10/26/2018 $3.00 2.44 263.28% 5.00 30,195 675,195 Issued 675,195 (193,559) Exercised (193,559) (368,941) Forfeited (368,941) 112,695 Outstanding 112,695 Options* and Warrants Options and Warrants 19,205,195 Issued Vested 11,143,529 (218,559) Exercised Exercised (218,559) (1,418,941) Forfeited Forfeited (818,941) 17,567,695 Outstanding Unexercised 10,106,029 * The number of outstanding options above does not include an option awarded to the Companys President to purchase 10,000,000 shares of Class A common stock at an exercise price of $1.00 per share. The option is only exercisable under certain limited circumstances, one of which is that the market price of the Class A common stock reaches a price of $15.00 per share. Once vested, these additional options must be exercised within two years of vesting. The number of options and warrants including these 10,000,000 options totals 24,045,000. On April 11, 2017 an independent company advisor exercised options for 25,000 shares of Class A common stock for $3,750 in cash. On August 14, 2018 a debt holder exercised warrants for 140,000 shares of Class A common stock for $21,000 in cash. On March 1, 2019 a debt holder exercised warrants for 7,474,770 shares of Class A common stock on a cashless exercise that resulted in a trigger to a down round feature and the recognition of a reduction of retained earnings of $121,011. During the year ended March 31, 2019 1,410,000 options and warrants were forfeited, 810,000 as a result of expiration, 600,000 due to employee termination, and 8,941 due to other causes. Of the 1,410,000 options and warrants that were forfeited, 600,000 had not previously vested. |
Note 10. Income Taxes_ Schedule
Note 10. Income Taxes: Schedule of Significant components of the deferred tax asset amounts (Tables) | 12 Months Ended |
Mar. 31, 2019 | |
Tables/Schedules | |
Schedule of Significant components of the deferred tax asset amounts | March 31, 2019 March 31, 2018 Net operating losses carryforwards $ 3,872,481 $ 2,726,760 Deferred tax asset 813,221 572,619 Valuation allowance for deferred asset (813,221) (572,619) Net deferred tax asset $ - $ - |
Note 1. Organization, Recent _4
Note 1. Organization, Recent History, and Description of Businesses-Present and Past (Details) | 12 Months Ended |
Mar. 31, 2019 | |
Details | |
Entity Incorporation, Date of Incorporation | Jun. 16, 2016 |
Note 1. Organization, Recent _5
Note 1. Organization, Recent History, and Description of Businesses-Present and Past: History and Recent Transaction (Details) | 12 Months Ended |
Mar. 31, 2019 | |
Details | |
Entity Incorporation, State or Country Code | DE |
Note 2. Summary of Significa_12
Note 2. Summary of Significant Accounting Policies: Going Concern (Details) - USD ($) | Mar. 31, 2019 | Mar. 31, 2018 |
Details | ||
Accumulated deficit | $ (27,967,566) | $ (13,703,597) |
Working capital deficit | $ 5,403,654 |
Note 2. Summary of Significa_13
Note 2. Summary of Significant Accounting Policies: Fair Value Measures (Details) - USD ($) | Mar. 31, 2019 | Mar. 31, 2018 |
Convertible note payable, 12%, derivative liability #4 | ||
Convertible Notes Payable, Current | $ 2,147,415 | $ 234,138 |
Note 3. Patents_ Schedule of _2
Note 3. Patents: Schedule of Patents and Trademarks (Details) - USD ($) | Mar. 31, 2019 | Mar. 31, 2018 |
Details | ||
Patents and trademarks under development | $ 217,744 | $ 170,946 |
Patents issued | 153,801 | 398 |
Less accumulated amortization | (3,759) | (368) |
Patents, net | $ 367,786 | $ 170,976 |
Note 3. Patents (Details)
Note 3. Patents (Details) - USD ($) | Mar. 31, 2019 | Mar. 31, 2019 | Mar. 31, 2018 |
Details | |||
Amortization of Intangible Assets | $ 3,759 | $ 30 | |
Payments to Acquire Intangible Assets | $ 367,786 | $ 200,599 | $ 170,946 |
Note 4. Concentration of Cred_2
Note 4. Concentration of Credit Risk (Details) - USD ($) | Mar. 31, 2019 | Mar. 31, 2018 |
Details | ||
Time Deposits, at or Above FDIC Insurance Limit | $ 0 | $ 37,907 |
Note 5. Notes Payable (Details)
Note 5. Notes Payable (Details) - USD ($) | 12 Months Ended | ||
Mar. 31, 2019 | Mar. 31, 2018 | Dec. 23, 2017 | |
Debt Instrument, Interest Rate, Stated Percentage | 8.50% | ||
Debt Instrument, Description | loan agreement | ||
Debt Instrument, Face Amount | $ 500,000 | ||
Accrued interest | $ 109,534 | 39,761 | |
Derivative Liability, Fair Value, Gross Asset | $ 126,578 | ||
Debt Instrument, Convertible, Beneficial Conversion Feature | 138,000 | ||
2019 New Loan Agreements including Convertible Notes | |||
Regular interest expensed | 9,326 | ||
Original issue discount expensed | 4,029 | ||
Derivative Liability expensed | 91,149 | ||
2019 New Loan Agreements including Convertible Note | |||
Regular interest expensed | 8,470 | ||
Original issue discount expensed | 14,000 | ||
Derivative Liability expensed | 101,500 | ||
2019 New Loan Agreement including Convertible Note | |||
Regular interest expensed | 8,766 | ||
Original issue discount expensed | 17,096 | ||
Derivative Liability expensed | 142,500 | ||
Back End Note | |||
Regular interest expensed | 660 | ||
Original issue discount expensed | 2,008 | ||
Derivative Liability expensed | 19,075 | ||
10% convertible note payable | |||
Regular interest expensed | 4,632 | ||
Original issue discount expensed | 2,164 | ||
Derivative Liability expensed | 44,153 | ||
12% convertible note payable | |||
Regular interest expensed | 9,421 | ||
Original issue discount expensed | 17,613 | ||
Derivative Liability expensed | 85,912 | ||
A 10% convertible note payable | |||
Regular interest expensed | 1,319 | ||
Original issue discount expensed | 616 | ||
Derivative Liability expensed | 12,575 | ||
A 12% convertible note payable | |||
Regular interest expensed | 86 | ||
Original issue discount expensed | 92 | ||
Derivative Liability expensed | $ 615 | ||
Securities Purchase Agreement, Convertible Note 12% | |||
Debt Instrument, Issuance Date | Jun. 26, 2017 | ||
Debt Instrument, Interest Rate, Stated Percentage | 12.00% | ||
Debt Instrument, Description | convertible note payable | ||
Debt Instrument, Face Amount | $ 78,500 | ||
Proceeds from Loans | 75,000 | ||
Payments of Debt Issuance Costs | 3,500 | ||
Debt Instrument, Unamortized Discount, Current | 3,500 | ||
Amortization of Debt Issuance Costs | $ 3,500 | ||
Accrued interest | 0 | ||
Debt Instrument, Maturity Date | Mar. 30, 2018 | ||
Debt Instrument, Convertible, Terms of Conversion Feature | convert the note into shares of common stock of the Company at any time during the period beginning on the date which is one hundred and eighty days following the date of the note (dated June 26, 2017) and ending on the later of i) the maturity date, or ii) the date of payment of a default amount, if any | ||
Commitment Note and Convertible Note #1 | |||
Debt Instrument, Interest Rate, Stated Percentage | 10.00% | ||
Debt Instrument, Description | convertible promissory note | ||
Debt Instrument, Face Amount | $ 100,000 | ||
Debt Instrument, Maturity Date | Mar. 24, 2018 | ||
Debt Instrument, Convertible, Terms of Conversion Feature | convertible into shares of IronClad’s Class A common stock at the fixed price of $3.25 per share | ||
Commitment Note and Convertible Note #2a | |||
Debt Instrument, Issuance Date | Aug. 24, 2017 | ||
Debt Instrument, Interest Rate, Stated Percentage | 10.00% | ||
Debt Instrument, Description | convertible note | ||
Debt Instrument, Face Amount | $ 165,000 | ||
Proceeds from Loans | $ 150,000 | ||
Debt Instrument, Convertible, Terms of Conversion Feature | embedded beneficial conversion feature (“BCF”) based on a stated conversion price of $1.00 per share | ||
Derivative, Net Liability Position, Aggregate Fair Value | $ 3,362 | ||
Commitment Note and Convertible Note #2c | |||
Debt Instrument, Issuance Date | Mar. 15, 2018 | ||
Debt Instrument, Description | Convertible Note | ||
Debt Instrument, Face Amount | $ 82,500 | ||
Proceeds from Loans | 75,000 | ||
Debt Instrument, Convertible, Beneficial Conversion Feature | 69,000 | ||
Derivative, Net Liability Position, Aggregate Fair Value | 155,000 | ||
Regular interest expensed | 20,606 | 620 | |
Original issue discount expensed | 12,491 | 1,009 | |
Derivative Liability expensed | 20,064 | ||
Beneficial Conversion expensed | $ 63,841 | 5,159 | |
Commitment Note and Convertible Note #2b | |||
Debt Instrument, Issuance Date | Oct. 23, 2017 | ||
Debt Instrument, Description | Convertible Note | ||
Debt Instrument, Face Amount | $ 82,500 | ||
Proceeds from Loans | 75,000 | ||
Debt Instrument, Convertible, Beneficial Conversion Feature | 69,000 | ||
Regular interest expensed | 16,026 | 6,158 | |
Original issue discount expensed | 20,916 | 12,136 | |
Derivative Liability expensed | $ 57,024 | 49,449 | |
New Convertible Notes, 12% - #1 | |||
Debt Instrument, Issuance Date | Jan. 25, 2018 | ||
Debt Instrument, Interest Rate, Stated Percentage | 12.00% | ||
Debt Instrument, Description | convertible note | ||
Debt Instrument, Face Amount | $ 88,000 | ||
Proceeds from Loans | 85,000 | ||
Payments of Debt Issuance Costs | $ 3,000 | ||
Debt Instrument, Maturity Date | Oct. 30, 2018 | ||
Debt Instrument, Convertible, Terms of Conversion Feature | convert the note into shares of common stock of the Company at any time during the period beginning on the date which is one hundred and eighty days following the date of the note (dated January 25, 2018) and ending on the later of i) the maturity date, or ii) the date of payment of a default amount, if any | ||
Regular interest expensed | $ 3,009 | 1,765 | |
Original issue discount expensed | 2,302 | 698 | |
Derivative Liability expensed | $ 57,990 | ||
New Convertible Notes, 12% - #2 | |||
Debt Instrument, Issuance Date | Feb. 27, 2018 | ||
Debt Instrument, Interest Rate, Stated Percentage | 12.00% | ||
Debt Instrument, Description | convertible note | ||
Debt Instrument, Face Amount | $ 53,000 | ||
Proceeds from Loans | 50,000 | ||
Payments of Debt Issuance Costs | $ 3,000 | ||
Debt Instrument, Maturity Date | Nov. 3, 2018 | ||
Debt Instrument, Convertible, Terms of Conversion Feature | convert the note into shares of common stock of the Company at any time during the period beginning on the date which is one hundred and eighty days following the date of the note (dated February 27, 2018) and ending on the later of I) the maturity date, or ii) the date of payment of a default amount, if any | ||
Regular interest expensed | $ 2,492 | 558 | |
Original issue discount expensed | 2,585 | $ 415 | |
Derivative Liability expensed | $ 42,862 | ||
Working Capital Loan #1 | |||
Debt Instrument, Issuance Date | Feb. 27, 2018 | ||
Debt Instrument, Interest Rate, Stated Percentage | 8.50% | ||
Debt Instrument, Face Amount | $ 255,000 | ||
Proceeds from Loans | $ 250,000 | ||
Working Capital Loan #2 | |||
Debt Instrument, Issuance Date | Mar. 21, 2018 | ||
Debt Instrument, Face Amount | $ 245,000 | ||
Proceeds from Loans | $ 240,000 |
Note 5. Notes Payable_ Schedu_2
Note 5. Notes Payable: Schedule of dates, shares issued and principal amounts repaid (Details) | 12 Months Ended |
Mar. 31, 2019USD ($)$ / sharesshares | |
2017 Convertible Note 12% | |
Shares Issued | shares | 50,322 |
2017 Convertible Note 12% | Debt Instrument Conversion Event 1 | |
Conversion Date | Dec. 31, 2017 |
Principal Outstanding | $ 78,500 |
2017 Convertible Note 12% | Debt Instrument Conversion Event 2 | |
Conversion Date | Jan. 10, 2018 |
Principal Outstanding | $ 63,500 |
Principal Reduction | $ (15,000) |
Shares Issued | shares | 8,242 |
Exercise Price | $ / shares | $ 1.82 |
2017 Convertible Note 12% | Debt Instrument Conversion Event 3 | |
Conversion Date | Jan. 12, 2018 |
Principal Outstanding | $ 43,500 |
Principal Reduction | $ (20,000) |
Shares Issued | shares | 10,989 |
Exercise Price | $ / shares | $ 1.82 |
2017 Convertible Note 12% | Debt Instrument Conversion Event 4 | |
Conversion Date | Jan. 18, 2018 |
Principal Outstanding | $ 28,500 |
Principal Reduction | $ (15,000) |
Shares Issued | shares | 8,242 |
Exercise Price | $ / shares | $ 1.82 |
2017 Convertible Note 12% | Debt Instrument Conversion Event 5 | |
Conversion Date | Jan. 23, 2018 |
Principal Outstanding | $ 13,500 |
Principal Reduction | $ (15,000) |
Shares Issued | shares | 9,819 |
Exercise Price | $ / shares | $ 1.53 |
2017 Convertible Note 12% | Debt Instrument Conversion Event 6 | |
Conversion Date | Jan. 25, 2018 |
Principal Outstanding | $ 0 |
Principal Reduction | $ (13,500) |
Shares Issued | shares | 13,030 |
Exercise Price | $ / shares | $ 1.40 |
Commitment Note and Convertible Note | |
Shares Issued | shares | 4,588,586 |
Commitment Note and Convertible Note | Debt Instrument Conversion Event 1 | |
Conversion Date | Dec. 31, 2017 |
Principal Outstanding | $ 165,000 |
Commitment Note and Convertible Note | Debt Instrument Conversion Event 2 | |
Conversion Date | Mar. 26, 2018 |
Principal Outstanding | $ 155,000 |
Principal Reduction | $ (10,000) |
Shares Issued | shares | 9,958 |
Exercise Price | $ / shares | $ 1.00425 |
Commitment Note and Convertible Note | Debt Instrument Conversion Event 3 | |
Conversion Date | Jun. 1, 2018 |
Principal Outstanding | $ 135,000 |
Principal Reduction | $ (20,000) |
Shares Issued | shares | 32,219 |
Exercise Price | $ / shares | $ 0.62 |
Commitment Note and Convertible Note | Debt Instrument Conversion Event 4 | |
Conversion Date | Jul. 17, 2018 |
Principal Outstanding | $ 115,000 |
Principal Reduction | $ (20,000) |
Shares Issued | shares | 61,538 |
Exercise Price | $ / shares | $ 0.325 |
Commitment Note and Convertible Note | Debt Instrument Conversion Event 5 | |
Conversion Date | Aug. 23, 2018 |
Principal Outstanding | $ 105,000 |
Principal Reduction | $ (10,000) |
Shares Issued | shares | 73,260 |
Exercise Price | $ / shares | $ 0.1365 |
Commitment Note and Convertible Note | Debt Instrument Conversion Event 6 | |
Conversion Date | Sep. 14, 2018 |
Principal Outstanding | $ 85,000 |
Principal Reduction | $ (20,000) |
Shares Issued | shares | 236,686 |
Exercise Price | $ / shares | $ 0.0845 |
Commitment Note and Convertible Note | Debt Instrument Conversion Event 7 | |
Conversion Date | Feb. 6, 2019 |
Principal Outstanding | $ 45,000 |
Principal Reduction | $ (40,000) |
Shares Issued | shares | 2,051,282 |
Exercise Price | $ / shares | $ 0.0195 |
Commitment Note and Convertible Note | Debt Instrument Conversion Event 8 | |
Conversion Date | Feb. 25, 2019 |
Principal Outstanding | $ 0 |
Principal Reduction | $ (45,000) |
Shares Issued | shares | 2,123,643 |
Exercise Price | $ / shares | $ 0.02119 |
Commitment Note and Convertible Notes | |
Shares Issued | shares | 8,024,179 |
Commitment Note and Convertible Notes | Debt Instrument Conversion Event 1 | |
Conversion Date | Dec. 31, 2018 |
Principal Outstanding | $ 82,500 |
Commitment Note and Convertible Notes | Debt Instrument Conversion Event 2 | |
Conversion Date | Mar. 14, 2019 |
Principal Outstanding | $ 77,500 |
Principal Reduction | $ (5,000) |
Shares Issued | shares | 889,284 |
Exercise Price | $ / shares | $ 0.0056225 |
Commitment Note and Convertible Notes | Debt Instrument Conversion Event 3 | |
Conversion Date | Mar. 25, 2019 |
Principal Outstanding | $ 53,500 |
Principal Reduction | $ (24,000) |
Shares Issued | shares | 5,351,171 |
Exercise Price | $ / shares | $ 0.004485 |
Commitment Note and Convertible Notes | Debt Instrument Conversion Event 4 | |
Conversion Date | Mar. 27, 2019 |
Principal Outstanding | $ 49,500 |
Principal Reduction | $ (4,000) |
Shares Issued | shares | 891,862 |
Exercise Price | $ / shares | $ 0.004485 |
Commitment Note and Convertible Notes | Debt Instrument Conversion Event 5 | |
Conversion Date | Mar. 28, 2019 |
Principal Outstanding | $ 45,500 |
Principal Reduction | $ (4,000) |
Shares Issued | shares | 891,862 |
Exercise Price | $ / shares | $ 0.004485 |
2019 New Loan Agreements including Convertible Notes | Debt Instrument Conversion Event 1 | |
Conversion Date | Dec. 31, 2018 |
Principal Outstanding | $ 135,000 |
2019 New Loan Agreements including Convertible Notes | Debt Instrument Conversion Event 2 | |
Conversion Date | Feb. 4, 2019 |
Principal Outstanding | $ 120,000 |
Principal Reduction | $ (15,000) |
Shares Issued | shares | 808,303 |
Exercise Price | $ / shares | $ 0.0195 |
2019 New Loan Agreements including Convertible Notes | Debt Instrument Conversion Event 3 | |
Conversion Date | Mar. 1, 2019 |
Principal Outstanding | $ 111,500 |
Principal Reduction | $ (8,500) |
Shares Issued | shares | 921,451 |
Exercise Price | $ / shares | $ 0.00975 |
2019 New Loan Agreements including Convertible Notes | Debt Instrument Conversion Event 4 | |
Conversion Date | Mar. 21, 2019 |
Principal Outstanding | $ 99,000 |
Principal Reduction | $ (12,500) |
Shares Issued | shares | 2,876,192 |
Exercise Price | $ / shares | $ 0.004615 |
2019 New Loan Agreements including Convertible Notes | Debt Instrument Conversion Event 5 | |
Conversion Date | Mar. 29, 2019 |
Principal Outstanding | $ 77,000 |
Principal Reduction | $ (22,000) |
Shares Issued | shares | 5,218,503 |
Exercise Price | $ / shares | $ 0.004485 |
2019 New Loan Agreements including Convertible Note | Debt Instrument Conversion Event 1 | |
Conversion Date | Dec. 31, 2018 |
Principal Outstanding | $ 115,500 |
2019 New Loan Agreements including Convertible Note | Debt Instrument Conversion Event 2 | |
Conversion Date | Jan. 22, 2019 |
Principal Outstanding | $ 106,500 |
Principal Reduction | $ (9,000) |
Shares Issued | shares | 97,371 |
Exercise Price | $ / shares | $ 0.097565 |
2019 New Loan Agreements including Convertible Note | Debt Instrument Conversion Event 3 | |
Conversion Date | Feb. 4, 2019 |
Principal Outstanding | $ 91,500 |
Principal Reduction | $ (15,000) |
Shares Issued | shares | 794,872 |
Exercise Price | $ / shares | $ 0.0195 |
2019 New Loan Agreements including Convertible Note | Debt Instrument Conversion Event 4 | |
Conversion Date | Feb. 12, 2019 |
Principal Outstanding | $ 77,000 |
Principal Reduction | $ (14,500) |
Shares Issued | shares | 769,231 |
Exercise Price | $ / shares | $ 0.0195 |
2019 New Loan Agreements including Convertible Note | Debt Instrument Conversion Event 5 | |
Conversion Date | Feb. 20, 2019 |
Principal Outstanding | $ 57,500 |
Principal Reduction | $ (19,500) |
Shares Issued | shares | 1,025,642 |
Exercise Price | $ / shares | $ 0.0195 |
2019 New Loan Agreements including Convertible Note | Debt Instrument Conversion Event 6 | |
Conversion Date | Feb. 28, 2019 |
Principal Outstanding | $ 42,500 |
Principal Reduction | $ (15,000) |
Shares Issued | shares | 1,402,715 |
Exercise Price | $ / shares | $ 0.01105 |
2019 New Loan Agreements including Convertible Note | Debt Instrument Conversion Event 7 | |
Conversion Date | Mar. 11, 2019 |
Principal Outstanding | $ 30,000 |
Principal Reduction | $ (12,500) |
Shares Issued | shares | 2,105,264 |
Exercise Price | $ / shares | $ 0.006175 |
2019 New Loan Agreements including Convertible Note | Debt Instrument Conversion Event 8 | |
Conversion Date | Mar. 14, 2019 |
Principal Outstanding | $ 17,500 |
Principal Reduction | $ (12,500) |
Shares Issued | shares | 2,312,139 |
Exercise Price | $ / shares | $ 0.0056225 |
2019 New Loan Agreements including Convertible Note | Debt Instrument Conversion Event 9 | |
Conversion Date | Mar. 26, 2019 |
Principal Outstanding | $ 4,000 |
Principal Reduction | $ (13,500) |
Shares Issued | shares | 3,121,517 |
Exercise Price | $ / shares | $ 0.004485 |
2019 New Loan Agreement including Convertible Note | Debt Instrument Conversion Event 1 | |
Conversion Date | Dec. 31, 2018 |
Principal Outstanding | $ 157,500 |
2019 New Loan Agreement including Convertible Note | Debt Instrument Conversion Event 2 | |
Conversion Date | Jan. 24, 2019 |
Principal Outstanding | $ 147,500 |
Principal Reduction | $ (10,000) |
Shares Issued | shares | 80,972 |
Exercise Price | $ / shares | $ 0.1235 |
2019 New Loan Agreement including Convertible Note | Debt Instrument Conversion Event 3 | |
Conversion Date | Feb. 4, 2019 |
Principal Outstanding | $ 132,500 |
Principal Reduction | $ (15,000) |
Shares Issued | shares | 769,231 |
Exercise Price | $ / shares | $ 0.0195 |
2019 New Loan Agreement including Convertible Note | Debt Instrument Conversion Event 4 | |
Conversion Date | Feb. 7, 2019 |
Principal Outstanding | $ 115,000 |
Principal Reduction | $ (17,500) |
Shares Issued | shares | 897,436 |
Exercise Price | $ / shares | $ 0.0195 |
2019 New Loan Agreement including Convertible Note | Debt Instrument Conversion Event 5 | |
Conversion Date | Feb. 20, 2019 |
Principal Outstanding | $ 90,000 |
Principal Reduction | $ (25,000) |
Shares Issued | shares | 1,282,051 |
Exercise Price | $ / shares | $ 0.0195 |
2019 New Loan Agreement including Convertible Note | Debt Instrument Conversion Event 6 | |
Conversion Date | Feb. 27, 2019 |
Principal Outstanding | $ 75,000 |
Principal Reduction | $ (15,000) |
Shares Issued | shares | 1,357,466 |
Exercise Price | $ / shares | $ 0.01105 |
2019 New Loan Agreement including Convertible Note | Debt Instrument Conversion Event 7 | |
Conversion Date | Mar. 7, 2019 |
Principal Outstanding | $ 60,000 |
Principal Reduction | $ (15,000) |
Shares Issued | shares | 1,923,077 |
Exercise Price | $ / shares | $ 0.0078 |
2019 New Loan Agreement including Convertible Note | Debt Instrument Conversion Event 8 | |
Conversion Date | Mar. 13, 2019 |
Principal Outstanding | $ 45,000 |
Principal Reduction | $ (15,000) |
Shares Issued | shares | 2,667,852 |
Exercise Price | $ / shares | $ 0.0056225 |
2019 New Loan Agreement including Convertible Note | Debt Instrument Conversion Event 9 | |
Conversion Date | Mar. 25, 2019 |
Principal Outstanding | $ 35,000 |
Principal Reduction | $ (10,000) |
Shares Issued | shares | 2,229,654 |
Exercise Price | $ / shares | $ 0.04485 |
2019 New Loan Agreement including Convertible Note | Debt Instrument Conversion Event 10 | |
Conversion Date | Mar. 26, 2019 |
Principal Outstanding | $ 20,937 |
Principal Reduction | $ (14,063) |
Shares Issued | shares | 3,135,563 |
Exercise Price | $ / shares | $ 0.004485 |
2019 New Loan Agreement including Convertible Note | Debt Instrument Conversion Event 11 | |
Conversion Date | Mar. 29, 2019 |
Principal Outstanding | $ 1,000 |
Principal Reduction | $ (19,937) |
Shares Issued | shares | 4,445,262 |
Exercise Price | $ / shares | $ 0.004485 |
Note 6. Share Exchange Agreem_2
Note 6. Share Exchange Agreement (Details) | Jan. 06, 2017USD ($) |
Details | |
Restricted shares issued | $ 56,655,891 |
Note 7. Common Stock (Details)
Note 7. Common Stock (Details) - USD ($) | Feb. 16, 2018 | Jan. 24, 2018 | Jan. 23, 2018 | Dec. 31, 2017 | Sep. 30, 2017 | Jun. 30, 2017 | Mar. 31, 2017 | Mar. 31, 2018 |
Stock issued for cash | $ 127,503 | |||||||
Common Stock #1 | ||||||||
Sale of Stock, Description of Transaction | Company issued 5,843,954 shares of its Class A common stock at $0.15 per share for cash in the amount of $876,597 | |||||||
Stock issued for cash, shares | 5,843,954 | |||||||
Sale of Stock, Price Per Share | $ 0.15 | |||||||
Stock issued for cash | $ 876,597 | |||||||
Common Stock #2 | ||||||||
Sale of Stock, Description of Transaction | 75,000 shares at $0.15 per share for investment banking services in the amount of $11,250 | |||||||
Stock issued for cash, shares | 75,000 | |||||||
Sale of Stock, Price Per Share | $ 0.15 | |||||||
Stock issued for cash | $ 11,250 | |||||||
Common Stock #3 | ||||||||
Sale of Stock, Description of Transaction | three convertible note holders elected to convert their $210,000 of notes into 1,400,000 shares of Class A common stock at $0.15 per share | |||||||
Stock issued for cash, shares | 1,400,000 | |||||||
Sale of Stock, Price Per Share | $ 0.15 | |||||||
Stock issued for cash | $ 210,000 | |||||||
Common Stock #4 | ||||||||
Sale of Stock, Description of Transaction | 250,000 shares were issued pursuant to the Share Exchange Agreement at $0.03 per share | |||||||
Stock issued for cash, shares | 250,000 | |||||||
Sale of Stock, Price Per Share | $ 0.03 | |||||||
Common Stock #5 | ||||||||
Sale of Stock, Description of Transaction | subscriptions receivable that were outstanding at December 31, 2016 in the amount of $81,481 were collected | |||||||
Subscriptions receivable collected | $ 81,481 | |||||||
Common Stock #6 | ||||||||
Sale of Stock, Description of Transaction | 240,333 shares of Class A common stock at $0.15 per share for cash in the amount of $36,050 | |||||||
Stock issued for cash, shares | 240,333 | |||||||
Sale of Stock, Price Per Share | $ 0.15 | |||||||
Stock issued for cash | $ 36,050 | |||||||
Common Stock #7 | ||||||||
Sale of Stock, Description of Transaction | 25,000 shares at $0.15 per share for the conversion of stock options | |||||||
Stock issued for cash, shares | 25,000 | |||||||
Sale of Stock, Price Per Share | $ 0.15 | |||||||
Common Stock #8 | ||||||||
Sale of Stock, Description of Transaction | 75,000 shares at $2.90 per share for investment banking services valued at $217,500 | |||||||
Stock issued for cash, shares | 75,000 | |||||||
Sale of Stock, Price Per Share | $ 2.90 | |||||||
Stock issued for cash | $ 217,500 | |||||||
Common Stock #9 | ||||||||
Sale of Stock, Description of Transaction | 100,000 shares of Class A common stock at $3.49 per share for consulting services in the amount of $349,000 | |||||||
Stock issued for cash, shares | 100,000 | |||||||
Sale of Stock, Price Per Share | $ 3.49 | |||||||
Stock issued for cash | $ 349,000 | |||||||
Common Stock #10 | ||||||||
Sale of Stock, Description of Transaction | 37,500 shares at $3.50 per share for investment banking services valued at $131,250 | |||||||
Stock issued for cash, shares | 37,500 | |||||||
Sale of Stock, Price Per Share | $ 3.50 | |||||||
Stock issued for cash | $ 131,250 | |||||||
Common Stock #11 | ||||||||
Sale of Stock, Description of Transaction | 157,500 shares of Class A common stock at $4.10 per share to seven parties for consulting services in the amount of $660,750 | |||||||
Stock issued for cash, shares | 157,500 | |||||||
Sale of Stock, Price Per Share | $ 4.10 | |||||||
Stock issued for cash | $ 660,750 | |||||||
Common Stock #12 | ||||||||
Sale of Stock, Description of Transaction | 14,331 shares of its Class A stock in exchange for receipts totaling $25,823 ($1.80 per share) | |||||||
Stock issued for cash, shares | 14,331 | |||||||
Sale of Stock, Price Per Share | $ 1.80 | |||||||
Stock issued for cash | $ 25,823 | |||||||
Common Stock #13 | ||||||||
Sale of Stock, Description of Transaction | 24,265 shares were issued in exchange for proceeds of $38,824 ($1.60 per share) | |||||||
Stock issued for cash, shares | 24,265 | |||||||
Sale of Stock, Price Per Share | $ 1.60 | |||||||
Stock issued for cash | $ 38,824 | |||||||
Common Stock #14 | ||||||||
Sale of Stock, Description of Transaction | Company issued 10,000 shares of its Class A common stock at $2.25 per share to two advisors for services in the amount of about $22,500 | |||||||
Stock issued for cash, shares | 10,000 | |||||||
Sale of Stock, Price Per Share | $ 2.25 | |||||||
Stock issued for cash | $ 22,500 |
Note 8. Share Based Compensat_2
Note 8. Share Based Compensation (Details) | 12 Months Ended |
Dec. 31, 2017shares | |
Details | |
Restricted stock awards, shares granted for services | 287,500 |
Restricted stock awards, shares forfeited | 0 |
Restricted stock awards, expenses for services | 709,000 |
Restricted stock awards, expenses for business development | 349,000 |
Restricted stock awards, expenses for investor relations | 360,000 |
Note 9. Stock Options and War_3
Note 9. Stock Options and Warrants (Details) - USD ($) | 3 Months Ended | |||||||
Mar. 31, 2019 | Dec. 31, 2018 | Jun. 30, 2018 | Mar. 31, 2018 | Dec. 31, 2017 | Sep. 30, 2017 | Jun. 30, 2017 | Mar. 31, 2017 | |
Stock Options and Warrants #1 | ||||||||
Share-based Compensation Arrangement by Share-based Payment Award, Options, Grants in Period, Gross | 1,045,000 | |||||||
Shares Granted, Value, Share-based Payment Arrangement, before Forfeiture | $ 1,305,565 | |||||||
Stock Options and Warrants #2 | ||||||||
Share-based Compensation Arrangement by Share-based Payment Award, Options, Grants in Period, Gross | 9,000,000 | |||||||
Shares Granted, Value, Share-based Payment Arrangement, before Forfeiture | $ 622,045 | |||||||
Stock Options and Warrants #3 | ||||||||
Share-based Compensation Arrangement by Share-based Payment Award, Options, Grants in Period, Gross | 2,945,000 | |||||||
Shares Granted, Value, Share-based Payment Arrangement, before Forfeiture | $ 4,657,850 | |||||||
Fair Value Measurements, Valuation Processes, Description | Black-Scholes option pricing model | |||||||
Stock Options and Warrants #4 | ||||||||
Share-based Compensation Arrangement by Share-based Payment Award, Options, Grants in Period, Gross | 500,000 | |||||||
Shares Granted, Value, Share-based Payment Arrangement, before Forfeiture | $ 731,659 | |||||||
Fair Value Measurements, Valuation Processes, Description | Black-Scholes option pricing model | |||||||
Stock Options and Warrants #5 | ||||||||
Share-based Compensation Arrangement by Share-based Payment Award, Options, Grants in Period, Gross | 372,500 | |||||||
Shares Granted, Value, Share-based Payment Arrangement, before Forfeiture | $ 261,991 | |||||||
Fair Value Measurements, Valuation Processes, Description | Black-Scholes option pricing model | |||||||
Stock Options and Warrants #6 | ||||||||
Share-based Compensation Arrangement by Share-based Payment Award, Options, Grants in Period, Gross | 82,500 | |||||||
Shares Granted, Value, Share-based Payment Arrangement, before Forfeiture | $ 287,629 | |||||||
Fair Value Measurements, Valuation Processes, Description | Black-Scholes option pricing model | |||||||
Stock Options and Warrants #7 | ||||||||
Share-based Compensation Arrangement by Share-based Payment Award, Options, Grants in Period, Gross | 37,500 | |||||||
Shares Granted, Value, Share-based Payment Arrangement, before Forfeiture | $ 161,921 | |||||||
Fair Value Measurements, Valuation Processes, Description | Black-Scholes option pricing model | |||||||
Stock Options and Warrants #8 | ||||||||
Share-based Compensation Arrangement by Share-based Payment Award, Options, Grants in Period, Gross | 100,000 | 700,195 | 122,500 | 2,700,000 | ||||
Shares Granted, Value, Share-based Payment Arrangement, before Forfeiture | $ 31,994 | $ 137,058 | $ 123,719 | $ 4,873,048 | ||||
Fair Value Measurements, Valuation Processes, Description | Black-Scholes option pricing model | |||||||
Stock Options and Warrants #9 | ||||||||
Share-based Compensation Arrangement by Share-based Payment Award, Options, Grants in Period, Gross | 1,500,000 | |||||||
Shares Granted, Value, Share-based Payment Arrangement, before Forfeiture | $ 2,700,000 | |||||||
Fair Value Measurements, Valuation Processes, Description | Black-Scholes option pricing model |
Note 9. Stock Options and War_4
Note 9. Stock Options and Warrants: Schedule of assumptions used to estimate the fair values of the options and warrants (Details) | 12 Months Ended | |
Mar. 31, 2019$ / sharesshares | ||
Number of Options* | (1,050,000) | [1] |
Exercise Price | $ / shares | [1],[2],[3] | |
Risk-free Interest Rate | [1],[2],[3] | |
Volatility | [1],[2],[3] | |
Vested Options* | (450,000) | [1] |
Number of Options Issued | 18,530,000 | [1] |
Vested Options, Vested | 10,468,334 | [1] |
Number of Options Exercised | (25,000) | [1] |
Vested Options, Exercised | (25,000) | [1] |
Number of Options Unexercised | 17,455,000 | [1] |
Vested Options, Unexercised | 9,993,334 | [1] |
Options and Warrants, Issued | 19,205,195 | [1] |
Options and Warrants, Vested | 11,143,529 | |
Options and Warrants, Exercised | (218,559) | [3],[4],[5] |
Options and Warrants, Exercised | (218,559) | [3],[4],[5] |
Options and Warrants forfeited | (818,941) | |
Options and Warrants unexercised | 10,106,029 | |
Option #1 | ||
Number of Options* | 75,000 | [1] |
Date Issued | Jan. 16, 2017 | |
Exercise Price | $ / shares | $ 0.75 | |
Risk-free Interest Rate | 1.54% | |
Volatility | 226.01% | |
Life of Options in Years | 3 | |
Vested Options* | 75,000 | [1] |
Option #2 | ||
Number of Options* | 6,000,000 | [1] |
Date Issued | Jan. 20, 2017 | |
Exercise Price | $ / shares | $ 0.15 | |
Risk-free Interest Rate | 1.54% | |
Volatility | 220.00% | |
Life of Options in Years | 3 | |
Vested Options* | 3,000,000 | [1] |
Option #3 | ||
Number of Options* | 3,000,000 | [1] |
Date Issued | Jan. 20, 2017 | |
Exercise Price | $ / shares | $ 0.15 | |
Risk-free Interest Rate | 1.54% | |
Volatility | 220.00% | |
Life of Options in Years | 4 | |
Vested Options* | 2,000,000 | [1] |
Option #4 | ||
Number of Options* | 350,000 | [1],[2] |
Date Issued | Jan. 31, 2017 | |
Exercise Price | $ / shares | $ 0.15 | |
Risk-free Interest Rate | 1.19% | |
Volatility | 132.84% | |
Life of Options in Years | 1.93 | |
Vested Options* | 350,000 | [1],[2] |
Option #5 | ||
Number of Options* | 100,000 | [1],[2] |
Date Issued | Feb. 1, 2017 | |
Exercise Price | $ / shares | $ 0.15 | |
Risk-free Interest Rate | 1.22% | |
Volatility | 134.90% | |
Life of Options in Years | 2 | |
Vested Options* | 100,000 | [1],[2] |
Option #6 | ||
Number of Options* | 100,000 | [1],[3],[4],[5] |
Date Issued | Mar. 13, 2017 | |
Exercise Price | $ / shares | $ 0.15 | |
Risk-free Interest Rate | 1.40% | |
Volatility | 144.84% | |
Life of Options in Years | 2 | |
Vested Options* | 100,000 | [1],[3],[4],[5] |
Option #7 | ||
Number of Options* | 20,000 | [1] |
Date Issued | Mar. 21, 2017 | |
Exercise Price | $ / shares | $ 0.15 | |
Risk-free Interest Rate | 1.54% | |
Volatility | 233.07% | |
Life of Options in Years | 3 | |
Vested Options* | 20,000 | [1] |
Option #8 | ||
Number of Options* | 5,000 | [1] |
Date Issued | Apr. 30, 2017 | |
Exercise Price | $ / shares | $ 0.75 | |
Risk-free Interest Rate | 1.45% | |
Volatility | 219.35% | |
Life of Options in Years | 3 | |
Vested Options* | 5,000 | [1] |
Option #9 | ||
Number of Options* | 1,700,000 | [1] |
Date Issued | May 5, 2017 | |
Exercise Price | $ / shares | $ 1.47 | |
Risk-free Interest Rate | 1.71% | |
Volatility | 565.34% | |
Life of Options in Years | 4 | |
Vested Options* | 850,000 | [1] |
Option #10 | ||
Number of Options* | 1,000,000 | [1] |
Date Issued | May 5, 2017 | |
Exercise Price | $ / shares | $ 1.47 | |
Risk-free Interest Rate | 1.32% | |
Volatility | 202.99% | |
Life of Options in Years | 2 | |
Vested Options* | 1,000,000 | [1] |
Option #11 | ||
Number of Options* | 80,000 | [1] |
Date Issued | May 31, 2017 | |
Exercise Price | $ / shares | $ 0.75 | |
Risk-free Interest Rate | 1.44% | |
Volatility | 196.06% | |
Life of Options in Years | 3 | |
Vested Options* | 80,000 | [1] |
Option #12 | ||
Number of Options* | 660,000 | [1],[2] |
Date Issued | Jun. 12, 2017 | |
Exercise Price | $ / shares | $ 2.50 | |
Risk-free Interest Rate | 1.64% | |
Volatility | 589.85% | |
Life of Options in Years | 4 | |
Vested Options* | 230,000 | [1] |
Option #13 | ||
Number of Options* | 5,000 | [1] |
Date Issued | Jun. 30, 2017 | |
Exercise Price | $ / shares | $ 3.49 | |
Risk-free Interest Rate | 1.55% | |
Volatility | 197.13% | |
Life of Options in Years | 3 | |
Vested Options* | 5,000 | [1] |
Option #14 | ||
Number of Options* | 300,000 | [1] |
Date Issued | Jul. 26, 2017 | |
Exercise Price | $ / shares | $ 3.16 | |
Risk-free Interest Rate | 1.63% | |
Volatility | 296.38% | |
Life of Options in Years | 4 | |
Vested Options* | 150,000 | [1] |
Option #15 | ||
Number of Options* | 5,000 | [1] |
Date Issued | Jul. 31, 2017 | |
Exercise Price | $ / shares | $ 3.50 | |
Risk-free Interest Rate | 1.51% | |
Volatility | 170.61% | |
Life of Options in Years | 3 | |
Vested Options* | 5,000 | [1] |
Option #16 | ||
Number of Options* | 37,500 | [1] |
Date Issued | Aug. 25, 2017 | |
Exercise Price | $ / shares | $ 2.50 | |
Risk-free Interest Rate | 1.62% | |
Volatility | 170.38% | |
Life of Options in Years | 3 | |
Vested Options* | 37,500 | [1] |
Option #17 | ||
Number of Options* | 25,000 | [1] |
Date Issued | Aug. 31, 2017 | |
Exercise Price | $ / shares | $ 3.75 | |
Risk-free Interest Rate | 1.44% | |
Volatility | 170.57% | |
Life of Options in Years | 3 | |
Vested Options* | 25,000 | [1] |
Option #18 | ||
Number of Options* | 37,500 | [1] |
Date Issued | Oct. 26, 2017 | |
Exercise Price | $ / shares | $ 4.50 | |
Risk-free Interest Rate | 1.76% | |
Volatility | 220.28% | |
Life of Options in Years | 3 | |
Vested Options* | 37,500 | [1] |
Option #19 | ||
Number of Options* | 25,000 | [1] |
Date Issued | Jan. 25, 2018 | |
Exercise Price | $ / shares | $ 2.70 | |
Risk-free Interest Rate | 2.20% | |
Volatility | 247.35% | |
Life of Options in Years | 3 | |
Vested Options* | 25,000 | [1] |
Option #20 | ||
Number of Options* | 25,000 | [1] |
Date Issued | Mar. 2, 2018 | |
Exercise Price | $ / shares | $ 1.80 | |
Risk-free Interest Rate | 2.52% | |
Volatility | 297.39% | |
Life of Options in Years | 3.84 | |
Vested Options* | 25,000 | [1] |
Option #21 | ||
Number of Options* | 400,000 | [1] |
Date Issued | Mar. 2, 2018 | |
Exercise Price | $ / shares | $ 1.80 | |
Risk-free Interest Rate | 2.71% | |
Volatility | 369.15% | |
Life of Options in Years | 5.84 | |
Vested Options* | 134,000 | [1] |
Option #22 | ||
Number of Options* | 3,400,000 | [1],[2] |
Date Issued | Mar. 2, 2018 | |
Exercise Price | $ / shares | $ 1.80 | |
Risk-free Interest Rate | 2.79% | |
Volatility | 369.05% | |
Life of Options in Years | 6.84 | |
Vested Options* | 1,601,000 | [1] |
Option #23 | ||
Number of Options* | 350,000 | [1] |
Date Issued | Mar. 2, 2018 | |
Exercise Price | $ / shares | $ 1.80 | |
Risk-free Interest Rate | 2.79% | |
Volatility | 395.11% | |
Life of Options in Years | 7.84 | |
Vested Options* | 116,667 | [1] |
Option #24 | ||
Number of Options* | 20,000 | [1] |
Date Issued | Apr. 2, 2018 | |
Exercise Price | $ / shares | $ 1.69 | |
Risk-free Interest Rate | 2.55% | |
Volatility | 372.73% | |
Life of Options in Years | 4.75 | |
Vested Options* | 20,000 | [1] |
Option #25 | ||
Number of Options* | 20,000 | [1] |
Date Issued | May 1, 2018 | |
Exercise Price | $ / shares | $ 1.20 | |
Risk-free Interest Rate | 2.82% | |
Volatility | 365.73% | |
Life of Options in Years | 4.67 | |
Vested Options* | 20,000 | [1] |
Option #26 | ||
Number of Options* | 20,000 | [1] |
Date Issued | Jun. 6, 2018 | |
Exercise Price | $ / shares | $ 1.14 | |
Risk-free Interest Rate | 2.81% | |
Volatility | 312.26% | |
Life of Options in Years | 4.57 | |
Vested Options* | 20,000 | [1] |
Option #27 | ||
Number of Options* | 270,000 | [1] |
Date Issued | Oct. 11, 2018 | |
Exercise Price | $ / shares | $ 0.32 | |
Risk-free Interest Rate | 2.97% | |
Volatility | 361.56% | |
Life of Options in Years | 2.97 | |
Vested Options* | 270,000 | [1] |
Option #28 | ||
Number of Options* | 500,000 | [1] |
Date Issued | Dec. 19, 2018 | |
Exercise Price | $ / shares | $ 0.15 | |
Risk-free Interest Rate | 2.62% | |
Volatility | 488.82% | |
Life of Options in Years | 6.4 | |
Vested Options* | 166,667 | [1] |
Warrant #1 | ||
Date Issued | Mar. 15, 2017 | |
Exercise Price | $ / shares | $ 0.15 | |
Risk-free Interest Rate | 1.02% | |
Volatility | 114.94% | |
Number of Warrants | 500,000 | [2],[3],[4],[5] |
Life of Warrants in Years | 1.40 | |
Vested Warrants | 500,000 | [2],[3],[4],[5] |
Warrant #2 | ||
Date Issued | Aug. 24, 2017 | |
Exercise Price | $ / shares | $ 3.50 | |
Risk-free Interest Rate | 1.63% | |
Volatility | 285.16% | |
Number of Warrants | 82,500 | |
Life of Warrants in Years | 4 | |
Vested Warrants | 82,500 | |
Warrant #3 | ||
Date Issued | Jun. 6, 2018 | |
Exercise Price | $ / shares | $ 3 | |
Risk-free Interest Rate | 2.69% | |
Volatility | 311.00% | |
Number of Warrants | 62,500 | [3],[4],[5] |
Life of Warrants in Years | 4 | |
Vested Warrants | 62,500 | [3],[4],[5] |
Warrant #4 | ||
Date Issued | Oct. 26, 2018 | |
Exercise Price | $ / shares | $ 3 | |
Risk-free Interest Rate | 2.44% | |
Volatility | 263.28% | |
Number of Warrants | 30,195 | |
Life of Warrants in Years | 5 | |
Vested Warrants | 30,195 | |
Warrants, Issued | ||
Number of Warrants | 675,195 | |
Vested Warrants | 675,195 | |
Warrants, exercised | ||
Number of Warrants | (193,559) | [3],[4],[5] |
Vested Warrants | (193,559) | [3],[4],[5] |
Warrants, forfeited | ||
Number of Warrants | (368,941) | [2] |
Vested Warrants | (368,941) | [2] |
Warrants, outstanding | ||
Number of Warrants | 112,695 | |
Vested Warrants | 112,695 | |
[1] | The number of outstanding options above does not include an option awarded to the Companys President to purchase 10,000,000 shares of Class A common stock at an exercise price of $1.00 per share. The option is only exercisable under certain limited circumstances, one of which is that the market price of the Class A common stock reaches a price of $15.00 per share. Once vested, these additional options must be exercised within two years of vesting. The number of options and warrants including these 10,000,000 options totals 24,045,000. | |
[2] | During the year ended March 31, 2019 1,410,000 options and warrants were forfeited, 810,000 as a result of expiration, 600,000 due to employee termination, and 8,941 due to other causes. Of the 1,410,000 options and warrants that were forfeited, 600,000 had not previously vested. | |
[3] | On April 11, 2017 an independent company advisor exercised options for 25,000 shares of Class A common stock for $3,750 in cash. | |
[4] | On August 14, 2018 a debt holder exercised warrants for 140,000 shares of Class A common stock for $21,000 in cash. | |
[5] | On March 1, 2019 a debt holder exercised warrants for 7,474,770 shares of Class A common stock on a cashless exercise that resulted in a trigger to a down round feature and the recognition of a reduction of retained earnings of $121,011. |
Note 10. Income Taxes_ Schedu_2
Note 10. Income Taxes: Schedule of Significant components of the deferred tax asset amounts (Details) - USD ($) | Mar. 31, 2019 | Mar. 31, 2018 |
Details | ||
Net operating losses carryforwards | $ 3,872,481 | $ 2,726,760 |
Deferred tax asset | 813,221 | 572,619 |
Valuation allowance for deferred asset | (813,221) | (572,619) |
Net deferred tax asset | $ 0 | $ 0 |
Note 10. Income Taxes (Details)
Note 10. Income Taxes (Details) | 12 Months Ended |
Mar. 31, 2019USD ($) | |
Details | |
Increase (Decrease) in Valuation Allowance | $ 240,602 |
Note 11 - Related Party Trans_2
Note 11 - Related Party Transactions (Details) | 12 Months Ended |
Mar. 31, 2018USD ($) | |
Details | |
Debt Instrument, Description | loan agreement |
Debt Instrument, Face Amount | $ 500,000 |
Debt Instrument, Interest Rate, Stated Percentage | 8.50% |
Debt Instrument, Collateral | a personal $500,000 guarantee from the President of the Company |
Note 12. General and Administ_2
Note 12. General and Administrative Expenses (Details) - USD ($) | 12 Months Ended | |
Mar. 31, 2019 | Mar. 31, 2018 | |
Details | ||
General, administrative and other operating | $ 2,528,688 | $ 2,365,482 |
Stock options issued for services, general and administrative | 1,993,242 | 959,214 |
Common stock issued for consulting services | $ 13,509 | $ 88,695 |
Note 13. Accounts Receivable _2
Note 13. Accounts Receivable and Revenue (Details) - USD ($) | 12 Months Ended | |
Mar. 31, 2019 | Mar. 31, 2018 | |
Details | ||
Accounts receivable | $ 0 | $ 301,978 |
Revenue | $ 780,211 | $ 229,745 |
Note 15. Subsequent Events (Det
Note 15. Subsequent Events (Details) | 12 Months Ended |
Mar. 31, 2019USD ($)shares | |
Event #1 | |
Subsequent Event, Date | Apr. 12, 2019 |
Subsequent Event, Description | IronClad entered into a Securities Purchase Agreement (SPA) to issue a 8% convertible note |
Debt Instrument, Interest Rate, Stated Percentage | 8.00% |
Debt Instrument, Description | convertible note |
Debt Instrument, Face Amount | $ 86,400 |
Debt Instrument, Convertible, Terms of Conversion Feature | The holder of the note, at its sole election, may convert the note into shares of common stock of the Company at any time during the period beginning on the date which is 180 days following the date of the note (dated July 11, 2018) and ending on the later of i) the maturity date, or ii) the date of payment of a default amount, if any. |
Event #2 | |
Subsequent Event, Date | Apr. 23, 2019 |
Subsequent Event, Description | IronClad entered into a Securities Purchase Agreement to issue a 12% convertible note |
Debt Instrument, Interest Rate, Stated Percentage | 12.00% |
Debt Instrument, Description | convertible note |
Debt Instrument, Face Amount | $ 57,750 |
Debt Instrument, Convertible, Terms of Conversion Feature | The Holder of the note, at its sole election, may convert the note into shares of common stock of the Company after the six month anniversary of the note; the conversion price shall be equal to 65% of the lowest trading price for the fifteen prior trading days including the day upon which a notice of conversion is received. |
Event #3 | |
Subsequent Event, Date | May 15, 2019 |
Subsequent Event, Description | IronClad entered into a Securities Purchase Agreement to issue a 10% convertible note |
Debt Instrument, Interest Rate, Stated Percentage | 10.00% |
Debt Instrument, Description | convertible note |
Debt Instrument, Face Amount | $ 150,000 |
Debt Instrument, Convertible, Terms of Conversion Feature | The Holder of the note is entitled, at any time after cash payment, to convert all or any amount of the principal face amount of the Note then outstanding into shares of the Company's common stock. |
Event #4 | |
Subsequent Event, Description | 161,707,754 shares of Class A common stock were issued |
Shares, Issued | shares | 161,707,754 |
Stock Issued | $ 432,842 |
Event #5 | |
Subsequent Event, Date | Apr. 12, 2019 |
Subsequent Event, Description | Board of Directors (the “Board”) ratified the amendment of the Company’s Certificate of Incorporation |
Event #6 | |
Subsequent Event, Description | two separate complaints were filed against the Company by two contractors requesting disputed compensation |