Document and Entity Information
Document and Entity Information - $ / shares | 3 Months Ended | |
Jun. 30, 2019 | Aug. 12, 2019 | |
Registrant CIK | 0001455926 | |
Fiscal Year End | --03-31 | |
Document Type | 10-Q | |
Document Quarterly Report | true | |
Document Period End Date | Jun. 30, 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 | |
City Area Code | 888 | |
Local Phone Number | 362-7972 | |
Phone Fax Number Description | Issuer's telephone number | |
Title of 12(b) Security | Common Stock, $0.001 par value | |
Entity Listing, Par Value Per Share | $ 0.001 | |
Trading Symbol | IRNC | |
Security Exchange Name | NONE | |
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 | |
Amendment Flag | false | |
Document Fiscal Year Focus | 2020 | |
Document Fiscal Period Focus | Q1 | |
Common Class A | ||
Entity Common Stock, Shares Outstanding | 302,975,049 | |
Common Class B | ||
Entity Common Stock, Shares Outstanding | 1,538,872 |
Condensed Consolidated Balance
Condensed Consolidated Balance Sheets (June 30, 2019 Unaudited) - USD ($) | Jun. 30, 2019 | Mar. 31, 2019 |
Current assets | ||
Cash and cash equivalents | $ 335,913 | $ 277,575 |
Accounts receivable | 0 | 0 |
Prepaid expense and deposits | 31,569 | 29,900 |
Total current assets | 367,482 | 307,475 |
Other assets | ||
Patents, net | 363,941 | 367,786 |
Total assets | 731,423 | 675,261 |
Current liabilities | ||
Accounts payable | 619,079 | 604,149 |
Accounts payable, legal fees | 382,373 | 382,885 |
Accounts payable, related parties | 89,773 | 96,506 |
Accrued liabilities | 239,659 | 237,660 |
Accrued liabilities, payroll | 1,882,110 | 1,686,260 |
Accrued interest | 35,655 | 109,534 |
Derivative Liability, Current | 1,389,114 | 2,147,415 |
Total current liabilities | 5,024,559 | 5,711,129 |
Commitments and contingencies | 0 | 0 |
Total liabilities | 5,024,559 | 5,711,129 |
Stockholders' Equity (Deficit) | ||
Preferred Stock, Value | 0 | 0 |
Additional paid-in capital | 26,369,222 | 22,783,591 |
Common shares of Class A stock to be issued | 6,400 | 6,400 |
Accumulated deficit | (30,972,173) | (27,967,566) |
Total stockholders' equity (deficit) | (4,293,136) | (5,035,868) |
Total liabilities and stockholders' equity | 731,423 | 675,261 |
Common Class A | ||
Stockholders' Equity (Deficit) | ||
Common Stock, Value | 301,876 | 140,168 |
Common Class B | ||
Stockholders' Equity (Deficit) | ||
Common Stock, Value | 1,539 | 1,539 |
Convertible note payable, 10%, net - 1 | ||
Current liabilities | ||
Convertible Notes Payable, Current | 0 | 82,500 |
Convertible note payable, 10%, net - 2 | ||
Current liabilities | ||
Convertible Notes Payable, Current | 0 | 45,500 |
Convertible note payable, 12%, net - 3 | ||
Current liabilities | ||
Convertible Notes Payable, Current | 0 | 4,000 |
Convertible note payable, 10%, net - 4 | ||
Current liabilities | ||
Convertible Notes Payable, Current | 0 | 82,500 |
Convertible note payable, 09%, net - 5 | ||
Current liabilities | ||
Convertible Notes Payable, Current | 0 | 39,274 |
Convertible note payable, 09%, net - 6 | ||
Current liabilities | ||
Convertible Notes Payable, Current | 0 | 1,000 |
Convertible note payable, 10%, net - 7 | ||
Current liabilities | ||
Convertible Notes Payable, Current | 0 | 46,318 |
Convertible note payable, 12%, net - 8 | ||
Current liabilities | ||
Convertible Notes Payable, Current | 130,573 | 103,526 |
Convertible note payable, 10%, net - 9 | ||
Current liabilities | ||
Convertible Notes Payable, Current | 39,868 | 13,192 |
Convertible note payable, 12%, net - 10 | ||
Current liabilities | ||
Convertible Notes Payable, Current | 21,518 | 7,120 |
Convertible note payable, 9%, net - 11 | ||
Current liabilities | ||
Convertible Notes Payable, Current | 133,937 | 21,083 |
Convertible note payable, 9%, net - 12 | ||
Current liabilities | ||
Convertible Notes Payable, Current | 22,151 | 707 |
Convertible note payable, 9%, net - 13 | ||
Current liabilities | ||
Convertible Notes Payable, Current | 9,324 | 0 |
Convertible note payable, 10%, net - 14 | ||
Current liabilities | ||
Convertible Notes Payable, Current | 10,572 | 0 |
Convertible note payable, 10%, net - 15 | ||
Current liabilities | ||
Convertible Notes Payable, Current | $ 18,853 | $ 0 |
Condensed Consolidated Balanc_2
Condensed Consolidated Balance Sheets (June 30, 2019 Unaudited) - Parenthetical - $ / shares | Jun. 30, 2019 | Mar. 31, 2019 |
Preferred Stock, Par or Stated Value Per Share | $ 0.001 | $ 0.001 |
Preferred Stock, Shares Authorized | 20,000,000 | 20,000,000 |
Preferred Stock, Shares Issued | 100 | 0 |
Preferred Stock, Shares Outstanding | 100 | 0 |
Common Class A | ||
Common Stock, Par or Stated Value Per Share | $ 0.001 | $ 0.001 |
Common Stock, Shares Authorized | 800,000,000 | 800,000,000 |
Common Stock, Shares, Issued | 301,876,153 | 140,168,393 |
Common Stock, Shares, Outstanding | 301,876,153 | 140,168,393 |
Common Class B | ||
Common Stock, Par or Stated Value Per Share | $ 0.001 | $ 0.001 |
Common Stock, Shares Authorized | 1,707,093 | 1,707,093 |
Common Stock, Shares, Issued | 1,538,872 | 1,538,872 |
Common Stock, Shares, Outstanding | 1,538,872 | 1,538,872 |
Condensed Consolidated Statemen
Condensed Consolidated Statements of Operations (Unaudited) - USD ($) | 3 Months Ended | |
Jun. 30, 2019 | Jun. 30, 2018 | |
Details | ||
Revenues | $ 0 | $ 579,236 |
Operating expenses | ||
Product development costs | 408,587 | 587,073 |
Services | 0 | 389,281 |
General and administrative | 430,513 | 607,389 |
Officer and directors fees | 1,388,456 | 1,307,855 |
Investor relations | 51,607 | 49,450 |
Professional fees | 12,406 | 94,015 |
Amortization | 3,845 | 7 |
Total operating Expenses | 2,295,414 | 3,035,070 |
Loss from operations | (2,295,414) | (2,455,834) |
Other income (expense) | ||
Interest income | 0 | 1 |
Interest expense | (572,374) | (351,113) |
Financing expense | (1,500) | (162,869) |
Loss on issuance of convertible notes with derivatives | (571,210) | 0 |
Gain (loss) on valuation of derivative liabilities | 514,487 | 4,921 |
Total other income (expense) | (630,597) | (509,060) |
Loss before taxes | (2,926,011) | (2,964,894) |
Income taxes | ||
Income tax benefit | 0 | 0 |
Income tax expense | 0 | 0 |
Total income taxes | 0 | 0 |
Net loss | $ (2,926,011) | $ (2,964,894) |
Net loss per common share, basic and diluted | $ (0.01) | $ (0.04) |
Weighted average number of basic and diluted common stock shares | 274,261,806 | 68,118,349 |
Consolidated Statements of Stoc
Consolidated Statements of Stockholders' Equity (Unaudited) - USD ($) | Common Class A | Common Class B | Additional Paid-in Capital | Receivables from Stockholder | Retained Earnings | Total |
Equity Balance, Starting at Mar. 31, 2018 | $ 66,457 | $ 1,539 | $ 11,514,917 | $ 101,750 | $ (13,703,597) | $ (2,018,934) |
Shares Outstanding, Starting at Mar. 31, 2018 | 66,457,071 | 1,538,872 | ||||
Stock Issued During Period, Value, Issued for Services | $ 125 | $ 0 | 209,125 | (101,750) | 0 | 107,500 |
Stock Issued During Period, Shares, Issued for Services | 125,000 | 0 | ||||
Stock Issued During Period, Value, Conversion of Convertible Securities, Net of Adjustments | $ 32 | $ 0 | 44,122 | 0 | 0 | 44,155 |
Stock Issued During Period, Shares, Conversion of Convertible Securities | 32,219 | 0 | ||||
Common stock issued for convertible debt, value | $ 240 | $ 0 | 165,625 | 0 | 0 | 165,865 |
Common stock issued for convertible debt, shares | 240,384 | |||||
Options issued for development, Value | $ 0 | 559,510 | 0 | 0 | 559,510 | |
Options issued for development, shares | 0 | 0 | ||||
Options issued for services, G&A, Value | $ 0 | 548,077 | 0 | 0 | 548,077 | |
Options issued for services, G&A, shares | 0 | 0 | ||||
Stock options issued: officers, directors, Value | $ 0 | $ 0 | 1,168,605 | 0 | 0 | 1,168,605 |
Stock options issued: officers, directors, shares | 0 | 0 | ||||
Stock options issued for convertible debt, value | $ 0 | $ 0 | 43,123 | 0 | 0 | 43,123 |
Stock options issued for convertible debt, shares | 0 | |||||
Net Income (Loss) | $ 0 | $ 0 | 0 | (2,964,894) | (2,964,894) | |
Shares Outstanding, Ending at Jun. 30, 2018 | 66,854,674 | 1,538,872 | ||||
Equity Balance, Ending at Jun. 30, 2018 | $ 66,855 | $ 1,539 | 14,253,104 | 0 | (16,668,491) | (2,346,993) |
Stock Issued During Period, Value, Issued for Services | $ 2 | $ 0 | 898 | 0 | 0 | 900 |
Stock Issued During Period, Shares, Issued for Services | 2,000 | 0 | ||||
Stock Issued During Period, Value, Conversion of Convertible Securities, Net of Adjustments | $ 371 | $ 0 | 49,629 | 0 | 0 | 50,000 |
Stock Issued During Period, Shares, Conversion of Convertible Securities | 371,484 | 0 | ||||
Options issued for development, Value | $ 0 | 562,724 | 0 | 0 | 562,724 | |
Options issued for development, shares | 0 | 0 | ||||
Options issued for services, G&A, Value | $ 0 | 518,466 | 0 | 0 | 518,466 | |
Options issued for services, G&A, shares | 0 | 0 | ||||
Stock options issued: officers, directors, Value | $ 0 | 1,181,447 | 0 | 0 | 1,181,447 | |
Stock options issued: officers, directors, shares | 0 | 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 | ||||
Retirement of derivative liability | $ 0 | $ 0 | 145,664 | 0 | 0 | 145,664 |
Net Income (Loss) | $ 0 | $ 0 | 0 | (7,656,675) | (7,656,675) | |
Shares Outstanding, Ending at Sep. 30, 2018 | 67,368,158 | 1,538,872 | ||||
Equity Balance, Ending at Sep. 30, 2018 | $ 67,368 | $ 1,539 | 16,732,792 | 0 | (24,325,166) | (7,523,467) |
Stock Issued During Period, Value, Issued for Services | $ 50 | $ 0 | 15,950 | 3,200 | 0 | 19,200 |
Stock Issued During Period, Shares, Issued for Services | 50,000 | 0 | ||||
Stock Issued During Period, Value, Conversion of Convertible Securities, Net of Adjustments | $ 1,210 | $ 0 | 98,789 | 0 | 0 | 100,000 |
Stock Issued During Period, Shares, Conversion of Convertible Securities | 1,210,654 | 0 | ||||
Options issued for development, Value | $ 0 | $ 0 | 562,724 | 0 | 0 | 562,724 |
Options issued for development, shares | 0 | 0 | ||||
Options issued for services, G&A, Value | $ 0 | $ 0 | 550,056 | 0 | 0 | 550,056 |
Options issued for services, G&A, shares | 0 | 0 | ||||
Stock options issued: officers, directors, Value | $ 0 | $ 0 | 1,206,447 | 0 | 0 | 1,206,447 |
Stock options issued: officers, directors, shares | 0 | 0 | ||||
Retirement of derivative liability | $ 0 | $ 0 | 800,244 | 0 | 0 | 800,244 |
Net Income (Loss) | $ 0 | $ 0 | 0 | (325,172) | (325,172) | |
Shares Outstanding, Ending at Dec. 31, 2018 | 68,628,812 | 1,538,872 | ||||
Equity Balance, Ending at Dec. 31, 2018 | $ 68,628 | $ 1,539 | 19,967,003 | 3,200 | (24,650,338) | (4,609,968) |
Stock Issued During Period, Value, Issued for Services | $ 100 | $ 0 | 4,500 | 3,200 | 0 | 7,800 |
Stock Issued During Period, Shares, Issued for Services | 100,000 | 0 | ||||
Options issued for development, Value | $ 0 | $ 0 | (42,223) | 0 | 0 | (42,223) |
Options issued for development, shares | 0 | 0 | ||||
Options issued for services, G&A, Value | $ 0 | $ 0 | 376,642 | 0 | 0 | 376,642 |
Options issued for services, G&A, shares | 0 | 0 | ||||
Stock options issued: officers, directors, Value | $ 0 | $ 0 | 1,155,764 | 0 | 0 | 1,155,764 |
Stock options issued: officers, directors, shares | 0 | 0 | ||||
Retirement of derivative liability | $ 0 | $ 0 | 828,079 | 0 | 0 | 828,079 |
Stock options issued: financing fees | $ 0 | $ 0 | 10,265 | 0 | 0 | 10,265 |
Stock options issued: financing fees, shares | 0 | 0 | ||||
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) |
Stock issued for debt conversion, shares | 63,964,811 | 0 | ||||
Stock issued for debt conversion, Value | $ 63,968 | $ 0 | 257,439 | 0 | 0 | 321,407 |
Net Income (Loss) | $ 0 | $ 0 | 0 | 0 | (3,083,630) | (3,083,630) |
Shares Outstanding, Ending at Mar. 31, 2019 | 140,168,393 | 1,538,872 | ||||
Equity Balance, Ending at Mar. 31, 2019 | $ 140,169 | $ 1,539 | 22,783,591 | 6,400 | (27,967,567) | (5,035,868) |
Options issued for development, Value | $ 0 | $ 0 | 408,587 | 0 | 0 | 408,587 |
Options issued for development, shares | 0 | 0 | ||||
Options issued for services, G&A, Value | $ 0 | $ 0 | 338,349 | 0 | 0 | 338,349 |
Options issued for services, G&A, shares | 0 | 0 | ||||
Stock options issued: officers, directors, Value | $ 0 | $ 0 | 1,168,606 | 0 | 0 | 1,168,606 |
Stock options issued: officers, directors, shares | 0 | 0 | ||||
Retirement of derivative liability | $ 0 | $ 0 | 1,045,523 | 0 | 0 | 1,045,523 |
Dividend treatment of convertible note warrants | $ 0 | $ 0 | 78,596 | 0 | (78,596) | 0 |
Stock issued for debt conversion, shares | 161,707,755 | 0 | ||||
Stock issued for debt conversion, Value | $ 161,708 | $ 0 | 545,970 | 0 | 0 | 707,677 |
Net Income (Loss) | $ 0 | $ 0 | 0 | 0 | (2,926,011) | (2,926,011) |
Shares Outstanding, Ending at Jun. 30, 2019 | 301,876,148 | 1,538,872 | ||||
Equity Balance, Ending at Jun. 30, 2019 | $ 301,876 | $ 1,539 | $ 26,369,222 | $ 6,400 | $ (30,972,173) | $ (4,293,136) |
Condensed Consolidated Statem_2
Condensed Consolidated Statements of Cash Flows (Unaudited) - USD ($) | 3 Months Ended | |
Jun. 30, 2019 | Jun. 30, 2018 | |
Cash flows from operating activities: | ||
Net loss | $ (2,926,011) | $ (2,964,894) |
Adjustments to reconcile net income (loss) to net cash provided (used) by operating activities: | ||
Amortization expense | 3,845 | 7 |
Amortization of notes discount amounts | 35,693 | 13,261 |
Amortization of loan discount costs, BCF | 0 | 46,887 |
Amortization of loan discount costs, Derivatives | 337,228 | 257,579 |
Financing fees | 1,500 | 162,869 |
(Gain) Loss on (retirement) issuance of note with derivative | 571,210 | 0 |
(Gain) loss on valuation of derivative liability | (514,487) | (4,922) |
Common stock issued for services, general and administrative | 0 | 84,500 |
Common stock issued for services, professional fees | 0 | 23,000 |
Stock options issued for services, development | 408,587 | 559,510 |
Stock options issued for services, general and administrative | 338,348 | 548,077 |
Stock options issued for officers and directors | 1,168,606 | 1,168,606 |
Changes in assets and liabilities: | ||
Increase in accounts receivable | 0 | (69,261) |
Decrease (increase) in prepaids | (1,669) | 13,156 |
Increase in accounts payable | 7,685 | 42,500 |
Increase in accrued expense | 197,850 | 64,272 |
Increase in accrued interest | 199,453 | 33,058 |
Net cash used by operating activities | (172,162) | (21,795) |
Cash flows from investing activities: | ||
Patent applications | 0 | (196,942) |
Net cash used by investing activities | 0 | (196,942) |
Cash flows from financing activities: | ||
Net cash provided by financing activities | 230,500 | 197,805 |
Increase (decrease) in cash and cash equivalents | 58,338 | (20,932) |
Cash and Cash Equivalents, at Carrying Value, Beginning Balance | 277,575 | 448,061 |
Cash and Cash Equivalents, at Carrying Value, Ending Balance | 335,913 | 427,129 |
Supplemental Cash Flow: | ||
Interest paid | 0 | 327 |
Income taxes paid | 0 | 0 |
Common stock issued to retire convertible notes | 707,677 | 20,000 |
Beneficial conversion & derivative liability features related to notes issue | 230,500 | 24,155 |
Convertile Note Payable | ||
Cash flows from financing activities: | ||
Proceeds from Convertible Debt | 43,200 | 0 |
Payments of Debt Issuance Costs | (5,200) | 0 |
Convertile Note Payable, 8.5% | ||
Cash flows from financing activities: | ||
Proceeds from Convertible Debt | 57,750 | 0 |
Payments of Debt Issuance Costs | (7,750) | 0 |
Repayments of amended note payable | 0 | (125,000) |
Amended Note Payable | ||
Cash flows from financing activities: | ||
Proceeds from Convertible Debt | 0 | 100,000 |
Convertible note payable, 10% - 8 | ||
Cash flows from financing activities: | ||
Payments of Debt Issuance Costs | 0 | (2,000) |
6.5% Note (Insurance) | ||
Cash flows from financing activities: | ||
Repayments of Other Short-term Debt | 0 | (10,195) |
Convertile Note Payable, 12% | ||
Cash flows from financing activities: | ||
Proceeds from Convertible Debt | 150,000 | 250,000 |
Payments of Debt Issuance Costs | $ (7,500) | $ (15,000) |
Note 1. Organization, Recent Hi
Note 1. Organization, Recent History, and Description of Businesses-Present and Past | 3 Months Ended |
Jun. 30, 2019 | |
Notes | |
Note 1. Organization, Recent History, and Description of Businesses-Present and Past | Note 1. Organization, Recent History, and Description of Businesses-Past and Present 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 Recent Transaction 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 now 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 transition three month period ended March 31, 2018; the Company incorporated a new wholly owned subsidiary IronClad Pipeline IC, Inc. (Pipeline). Principles of Consolidation, Basis of Presentation, and Management Judgement 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 unaudited consolidated financial statements have been prepared in accordance with generally accepted accounting principles for interim financial information Accordingly, these unaudited interim consolidated financial statements do not include all of the disclosures required by generally accepted accounting principles in the United States of America for complete financial statements and the rules of the SEC. These unaudited interim consolidated financial statements should be read in conjunction with the Companys audited financial statements for the year ended March 31, 2019. In the opinion of management, the unaudited interim consolidated financial statements furnished herein include all adjustments, all of which are of a normal recurring nature, necessary for a fair statement of the results for the interim periods presented. Operating results for the three month period ended June 30, 2019 are not necessarily indicative of the results that may be expected for the year ending March 31, 2020. |
Note 2. Summary of Significant
Note 2. Summary of Significant Accounting Policies | 3 Months Ended |
Jun. 30, 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 June 30, 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 $30,972,173. The Company's working capital deficit is $4,657,077 (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 recognize revenue when we have identified a contract with a customer, identify the performance obligations in the contract, determine the transaction prices, when we allocate the transaction prices to the performance obligation in the contract and we recognize revenue when or as the Company satisfies the performance 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. 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 June 30, 2019 and March 31, 2019 the Company had conversion features embedded in its convertible notes payable. The fair value measurements of those derivatives, using a binomial valuation model, was $1,389,113 at June 30, 2019 and $2,147,415 at March 31, 2019 and is reported as convertible notes payable derivative liabilities on the balance sheet. The derivative liabilities are measured as Level 3 items. 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 17 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 ASU No. 2016-02, Leases (Topic 842), which establishes a comprehensive new lease accounting model. The new standard: (a) clarifies the definition of a lease; (b) requires a dual approach to lease classification similar to current lease classifications; and, (c) causes lessees to recognize leases on the balance sheet as a lease liability with a corresponding right-of-use asset for leases with a lease-term of more than twelve months. The standard is effective for calendar years beginning after December 15, 2018; no material impact to the reporting in the financial statements of the Company is expected from the adoption of this standard. 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 | 3 Months Ended |
Jun. 30, 2019 | |
Notes | |
Note 3. Patents | Note 3. Patents Patents and trademarks are as follows: June 30, 2019 March 31, 2019 Patents and trademarks under development $ 217,744 $ 217,744 Patents issued 153,801 153,801 Less accumulated amortization (7,604) (3,759) 146,197 150,042 Patents, net $ 363,941 $ 367,786 Amortization expense for intangible assets during the period ended June 30, 2019 and year ended March 31, 2019 was $3,845 and $3,789, respectively. Costs at June 30, 2019 totaling $371,545 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 fiscal years ended March 31, 2019 and March 31, 2018. These awarded and 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. IronClad's original patent portfolio included three issued and granted US patents. Each of the three original patents had expired and was written off at September 30, 2018. |
Note 4. Concentration of Credit
Note 4. Concentration of Credit Risk | 3 Months Ended |
Jun. 30, 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 June 30, 2019 and March 31, 2019, the Company had $45,241 and $0 on deposit in excess of the FDIC insured limit. |
Note 5 - Related Party Transact
Note 5 - Related Party Transactions | 3 Months Ended |
Jun. 30, 2019 | |
Notes | |
Note 5 - Related Party Transactions | Note 5 Related Party Transactions At June 30, 2019 and March 31, 2019 the Company owed approximately $89,773 and $96,506 in accounts payable to management and related parties. Of the $ 239,659 and $237,660 of accrued liabilities at June 30, 2019 and March 31, 2019, approximately $0 and $75,003 of those amounts are owed to the president of the Company; the costs primarily related to travel costs incurred in raising funds for the Company. See also Note 13 regarding stock option awards to management of the Company. |
Note 6. Notes Payable
Note 6. Notes Payable | 3 Months Ended |
Jun. 30, 2019 | |
Notes | |
Note 6. Notes Payable | Note 6. Notes Payable Commitment Note and Convertible Note, Equity Line with 10% Interest Rate 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 8. Commitment Note, $82,500 with 10% Interest Rate. The Commitment Note was 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 was 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 became 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 three-month period ended June 30, 2019, $2,102 of regular interest and $42,116 of default interest was expensed. During the three-month period ended June 30, 2018, $4,114 of regular interest was expensed. Convertible Note, Initial Consideration: $165,000 First Tranche with 10% Interest Rate. The Convertible Note also had 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 were recorded as discount amounts on the $165,000 note payable and were amortized as interest expenses over the life of the borrowing. The maturity date of this borrowing under the note was seven months from its funding date which was March 24, 2018. Between March 26, 2018 and February 25, 2019, the note holder exercised its rights under the conversion provisions and through the operation of seven conversion elections were 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) was approximately $424,407 using a Black-Scholes valuation model. That amount was 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 was $138,000 ($165,000 net of $27,000) and was amortized as interest expense over the life of the loan. Derivative Liabilities on Commitment and Convertible Notes (above). 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) was approximately $79,138 using a Black-Scholes valuation model. That amount was 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 was 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) was approximately $158,276 using a Black-Scholes valuation model. That amount was 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 was $155,000 the derivative valuation was recorded as $155,000. The amount was amortized as interest expense over an estimated remaining three month life of the already matured loan. During the three-month period ended June 30, 2019, $0 of regular interest and $0 of derivative liability was expensed because all amounts owed relating to the note were converted as of March 1, 2019. During the three-month period ended June 30, 2018, $7,400 of regular interest, $0 of original issue discount and $155,000 of beneficial conversion was expensed. Convertible Note, Second Tranche, $82,500 with 10% Interest Rate. The maturity date of this borrowing under the Convertible Note was also defined to be seven months from its borrowing date which was 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 was estimated to be approximately $289,000 and was capped at $69,000, the otherwise undiscounted amount of the note payable. Between March 14, 2019 and April 22, 2019, the holder of the note elected to convert $82,500 of principal into 18,630,240 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 04/12/19 $22,500 $(23,000) 5,361,305 $0.00429 04/16/19 $17,517 $(4,983) 1,161,539 $0.00429 04/22/19 $- $(17,517) 4,083,217 $0.00429 Total 8,024,179 During the three month period ended June 30, 2019, $406 of regular interest, $0 of original issue discount, and $0 of derivative liability was expensed. During the three month period ended June 30, 2018, $3,764 of regular interest, $20,916 of original issue discount and $23,443 of derivative liability was expensed. Convertible Note, Third Tranche, $82,500 with 10% Interest Rate. 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 was 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 was $69,000 ($82,500 net of $13,500) and was amortized as interest expense over the life of the loan. During the three-month period ended June 30, 2019, $2,080 of regular interest, $0 of original issue discount, $0 of beneficial conversion and $0 of derivative liability and $134,308 of default interest was expensed. During the three-month period ended June 30, 2018, $3,525 of regular interest, $5,930 of original issue discount and $29,205 of beneficial conversion was expensed. Convertible Notes, Post Maturity Derivative Liabilities. The valuation of the derivative liability related to the $82,500 borrowing on the Convertible Note and with an intrinsic value of $0.6912 per share is approximately $57,024 using a Binomial pricing model. That amount was recorded as a contra-note payable amount (similar to the recorded OID and transaction costs). The amount was amortized as interest expense over an estimated remaining three month life of the already matured loan. At June 30, 2018 the prior periods derivative liabilities were remeasured, as the notes were still outstanding, the derivative liability was revalued using a binomial pricing model. At period end the total valuation of new derivative liabilities related to three loans was approximately $262,086 for individual valuation amounts of $67,531, $120,993 and $73,561. There was no corresponding revaluation at June 30, 2019 because the underlying notes had been converted to common stock and were no longer outstanding. Fiscal Year Ended March 31, 2018 Notes Convertible Note, $88,000 with 12% Interest Rate. The note matured on October 30, 2018 and interest costs accrued on the unpaid principal balance at 12% annually until October 30, 2018, and after that if not paid at maturity interest accrued annually at 22% until the principal amount and all interest accrued and unpaid were 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 was 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 were a function of a variable conversion price which was 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. At June 30, 2018 a derivative liability with an intrinsic value of $0.2404 was $57,990 using a binomial pricing model and was recorded as a discount to the note. The note was repaid in mid-July, 2018; thus during the three-month period ended June 30, 2019 no interest was recorded on the note. During the three-month period ended June 30, 2018, $2,633 of regular interest and $1,025 of original issue discount was expensed. Convertible Note, $53,000 with 12% Interest Rate. The note matured on November 3, 2018 and interest costs accrued on the unpaid principal balance at 12% annually until November 30, 2018, and after that if not paid at maturity interest accrued annually at 22% until the principal amount and all interest accrued and unpaid were 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 was 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 were a function of a variable conversion price which was 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 kept 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. Derivative Liability. Because the note was repaid in August, 2018 no interest was recorded on the note during the three-month period ended June 30, 2019. During the three-month period ended June 30, 2018, $1,586 of regular interest and $1,146 of original issue discount was expensed. Working Capital Loan for Services to New Customer by IronClad Pipeline IC, Inc. with 8.5% Interest Rate. On March 21, 2018, IronClad borrowed an 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 $125,000 of the principal, and then redrew another $100,000. The outstanding principal balance of this loan at June 30, 2018 was $475,000 and was subsequently repaid in full by a series of cash payments through September 11, 2018. Interest is to be paid annually in cash on March 1, 2019 and 2020. Outstanding interest of $17,816 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 was no penalty for any of the 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 the lender. The Agreement is also supported by a personal $500,000 guarantee from an officer of the Company. IronClad owed the officer a 5% guarantee fee of $25,000; $15,000 was paid shortly after June 30, 2019 and the remaining $10,000 is to be paid 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 specified that the uses of funds were to be limited to only supporting the operations of the service contract and loan repayment. 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. Insurance Financing Note with 6% Interest Rate. On July 14, 2018 the outstanding loan principal balance was repaid plus accrued interest, both totaling $10,195, and the note was fully retired. Fiscal Year Ended March 31, 2019: New Loan Agreements including Convertible Notes Convertible Note, $250,000 with 10% Interest Rate . The note matured on December 26, 2018 and interest costs accrued on the unpaid principal balance at 10% annually until December 26, 2018, and after that if not paid at maturity interest accrued annually at 24% until the principal amount and all interest accrued and unpaid were 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 on or following the date of the Note from the 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 were a function of a fixed conversion price of $1.00 per share, 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 kept 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. Derivative Liability. 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 was repaid. The holder kept the shares, if the Note was 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. Warrants and Down Round Feature. 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. Because the note was repaid in November, 2018 no interest was recorded on the note during the three-month period ended June 30, 2019. During the three-month period ended June 30, 2018, $274 of regular interest and $328 of original issue discount 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. Convertible Note, $135,000 with 9% Interest Rate. The First Note matured on July 11, 2019 and interest costs accrued on the unpaid principal balance at 9% annually until July 11, 2019, and after that if not paid at maturity interest accrued annually at 24% until the principal amount and all interest accrued and unpaid were paid. The Back End Note carried the same terms as the First Note, except it could not be repaid, but only converted. The Company was under no obligation to accept the Back End Note, but could 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 could 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, could convert the note into shares of common stock of the Company at any time during the period beginning on the date which was 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 were 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 was 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 kept 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. From February 4, 2019 thru April 17, 2019 the holder of the note elected to convert $135,000 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 04/04/19 $56,000 $(21,000) 4,895,105 $0.00429 04/16/19 $29,000 $(27,000) 6,293,706 $0.00429 04/17/19 $- $(29,000) 6,759,907 $0.00429 Derivative Liability. During the three-month period ended June 30, 2019, $(697) of regular interest, $2,375 of unamortized original issue discount, and $35,351 of unamortized derivative liability was expensed. There was no corresponding expense during the three-month period ended June 30, 2018. Convertible Note, $115,500 with 12% Interest Rate. 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 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 were 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 kept available authorized shares reserved, initially 1,500,000 shares. From January 22, 2019 thru April 4, 2019 the holder of the note elected to convert $115,500 of principal, $4,500 of financing fees and $8,448 of accrued interest into 14,646,896 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 $(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 04/04/2019 $- $(4,000) 932,401 $0.00429 Derivative Liability. Convertible Note, $157,500 with 9% Interest Rate, First Note (and Back End Note). The First Note matured on July 19, 2019 and interest costs accrued on the unpaid principal balance at 9% annually until July 19, 2019, 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 Back End Note carries the same terms as the First Note, except it may not be repaid in cash, but only converted. The Company accepted the Back End Note on March 19, 2019. As part of the SPA, the Holder issued the Company a collateralized secured promissory note in the amount of $150,000 that was exchanged for cash against the Back End Note (discussed below). 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 180 days following the date of the note (dated July 19, 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. From January 24, 2019 thru April 1, 2019 the holder of the note elected to convert $157,500 of principal into 19,011,529 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 $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 04/01/19 $- $(1,000) 222,965 $0.004485 Derivative Liability. During the three-month period ended June 30, 2019, $(291) of regular interest, $0 of original issue discount, and $0 of derivative liability was expensed on the First Note, There was no corresponding expense during the three-month period ended June 30, 2018. Convertible Note, $157,500 with 9% Interest Rate, 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 March 14, 2019) 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. Derivative Liability. During the three-month period ended June 30, 2019, $3,534 of regular interest, $10,748 of original issue discount, and $102,106 of derivative liability was expensed on the Back End Note. There was no corresponding expense during the three-month period ended June 30, 2018. Convertible Note, $107,000 with 10% Interest Rate. 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 ending on the last trading day prior to the conversion date. The Company kept available authorized shares reserved, initially 2,993,000 shares. From April 17, 2019 thru May 16, 2019 the holder of the note elected to convert $107,000 of principal into 23,378,328 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 $107,000 04/17/2019 $79,000 $(28,000) 6,526,807 $0.00429 04/30/2019 $47,000 $(32,000) 7,032,967 $0.00455 05/03/2019 $12,500 $(34,500) 7,582,418 $0.00455 05/16/2019 $- $(12,500) 2,236,136 $0.005589 Derivative Liability. During the three-month period ended June 30, 2019, $816 of regular interest, $2,836 of original issue discount, and $57,847 of derivative liability was expensed. There was no corresponding expense during the three-month period ended June 30, 2018. Convertible Note, $181,170 with 12% Interest Rate. The Holder shall have the right at any time following the 180th calendar day after the issue date (October 26, 2018), and ending on the later of i) the maturity date, or ii) the date of payment of a default amount, if any, 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 ending on the last trading day prior to the conversion date. From May 7, 2019 thru June 10, 2019 the holder of the note elected to convert $33,342 of principal into 19,011,529 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 $181,170 04/17/2019 $168,261 $(12,909) 4,361,220 $0.00296 04/30/2019 $147,828 $(20,433) 8,374,250 $0.00244 The Company will keep available authorized shares reserved, initially 6,500,000 shares. In connection with the issuance of the Note, the Company issued a common stock purchase warrant to the Holder to purchase up to 30,195 shares of the Companys common stock at an exercise price of $3.00 per share with an exercise period of five years. The warrants were valued at $10,265 using a Black Scholes option pricing model and were recorded as a financing expense. Warrants and Down Round Feature. During the three-month period ended June 30, 2019, there were also multiple events that caused the down round feature to be triggered again. The cumulative effect reduced the exercise price to $0.0024 and the number of warrants exercisable was increased to 37,743,750. As a result, the valuation of the warrants increased to $201,663 and a reduction to retained earnings was recorded for the difference, similar to a dividend, in the amount of $78,596. Derivative Liability. During the three-month period ended June 30, 2019, $4,143 of regular interest, $10,275 of original issue discount, and $50,115 of derivative liability was expensed. There was no corresponding expense during the three-month period ended June 30, 2018. Convertible Note, $57,500 with 12% Interest Rate. The note matures on February 14, 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 Company 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. Derivative Liability. During the three-month period ended June 30, 2019, $1,728 of regular interest, $1,932 of original issue discount, and $12,466 of derivative liability was expensed. There was no corresponding expense during the three-month period ended June 30, 2018. Convertible Note, $107,000 with 10% Interest Rate. 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 Companys 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 11,551,000 shares. Derivative Liability. During the three-month period ended June 30, 2019, $2,668 of regular interest, $1,247 of original issue discount, and $25,430 of derivative liability was expensed. There was no corresponding expense during the three-month period ended June 30, 2018. Convertible Note, $86,250 with 12% Interest Rate, First Note (and Back End and Collateralized Notes). The First Note matures on March 28, 2020 and interest costs accrue on the unpaid principal balance at 12% annually until March 28, 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 Back End Note carries the same terms as the First Note, except it may not be repaid in cash, but only by a conversion to Class A common stock. As part of the SPA, the Holder issued the Company a collateralized secured promissory note in the amount of $ 78,750 that may be exchanged for cash against the Back End Note. The holder |
Note 7. Preferred and Common St
Note 7. Preferred and Common Stock | 3 Months Ended |
Jun. 30, 2019 | |
Notes | |
Note 7. Preferred and Common Stock | Note 7. Preferred and Common Stock 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. 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 Note 6. 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: At the close of March 31, 2019 there were 20,000 shares valued at $6,400 that were recorded and reported as to be issued. During the three month period ended June 30, 2019, the Company approved for issuance: |
Note 8. General and Administrat
Note 8. General and Administrative Expenses | 3 Months Ended |
Jun. 30, 2019 | |
Notes | |
Note 8. General and Administrative Expenses | Note 8. General and Administrative Expenses General and administrative expenses recognized for the three-month period ended June 30, 2019 and June 30, 2018 were $430,516 and $607,389, respectively of which $338,348 and $548,078 were recognized as compensation expenses in connection with the issuance of stock options or warrants. |
Note 9. Income Taxes
Note 9. Income Taxes | 3 Months Ended |
Jun. 30, 2019 | |
Notes | |
Note 9. Income Taxes | Note 9. Income Taxes Federal and state income taxes are not currently due since IronClad has had losses since inception. Because the Company provided services (discontinued after July 2018) to a customer in Virginia, IronClad was also subject to Virginia state income tax reporting through the date services were discontinued. 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 June 30, 2019 and March 31, 2019 are as follows: June 30, 2019 March 31, 2019 Net operating losses carryforwards $ 4,291,650 $ 3,872,481 Deferred tax asset 901,247 813,221 Valuation allowance for deferred asset (901,247) (813,221) Net deferred tax asset $ - $ - At June 30, 2019, the Company has net operating loss carryforwards of approximately $4,291,650 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, 2019 to June 30, 2019 was $88,026. |
Note 10. Share Exchange Agreeme
Note 10. Share Exchange Agreement | 3 Months Ended |
Jun. 30, 2019 | |
Notes | |
Note 10. Share Exchange Agreement | Note 10. 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 Company--now using the name IronClad--remains intact. |
Note 11. Share Based Compensati
Note 11. Share Based Compensation | 3 Months Ended |
Jun. 30, 2019 | |
Notes | |
Note 11. Share Based Compensation | Note 11. 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 approximately $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 12. Stock Options and Warr
Note 12. Stock Options and Warrants | 3 Months Ended |
Jun. 30, 2019 | |
Notes | |
Note 12. Stock Options and Warrants | Note 12. 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. In addition, 25,000 stock options that were awarded during the three-month period ending March 31, 2017 were exercised for cash in the amount of $3,750. 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 valued at $123,719. Of the total 122,500 options and warrants awarded, 102,500 vested during the period and received full recognition in the three-month period ended June 30, 2018. The remaining 20,000 options vest during the subsequent quarter and will be expensed at that time. 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. During the three-month period ended June 30, 2019 the Company did not award any stock options or warrants. 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 June 30, 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 13. Commitments and Contin
Note 13. Commitments and Contingencies | 3 Months Ended |
Jun. 30, 2019 | |
Notes | |
Note 13. Commitments and Contingencies | Note 13. Commitments and Contingencies In the three month period ended June 30, 2019 complaints were filed against the Company by two contractors requesting disputed compensation. We are answering these claims, and are vigorously defending our legal rights. Because of the preliminary nature of the complaints the Company is unable to predict any likely outcome of addressing the complaints. We rent office space on a month-to-month basis. The annual cost is less than $17,000. We have no other leases or rental agreements. Because the rent is considered short term in the context of the Financial Accounting Standards Boards ASU No. 2016-02, Leases (Topic 842) |
Note 14. Subsequent Events
Note 14. Subsequent Events | 3 Months Ended |
Jun. 30, 2019 | |
Notes | |
Note 14. Subsequent Events | Note 14. Subsequent Events Subsequent to June 30, 2019 1,098,901 shares of Class A common stock were issued to repay $5,000 of convertible notes principal balances. |
Note 1. Organization, Recent _2
Note 1. Organization, Recent History, and Description of Businesses-Present and Past: Description of Businesses: Present and Recent Past (Policies) | 3 Months Ended |
Jun. 30, 2019 | |
Policies | |
Description of Businesses: Present and Recent 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. |
Note 1. Organization, Recent _3
Note 1. Organization, Recent History, and Description of Businesses-Present and Past: History and Recent Transaction (Policies) | 3 Months Ended |
Jun. 30, 2019 | |
Policies | |
History and Recent Transaction | History and Recent Transaction 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 now 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 transition three month period ended March 31, 2018; the Company incorporated a new wholly owned subsidiary IronClad Pipeline IC, Inc. (Pipeline). |
Note 1. Organization, Recent _4
Note 1. Organization, Recent History, and Description of Businesses-Present and Past: Principles of Consolidation, Basis of Presentation, and Management Judgement (Policies) | 3 Months Ended |
Jun. 30, 2019 | |
Policies | |
Principles of Consolidation, Basis of Presentation, and Management Judgement | Principles of Consolidation, Basis of Presentation, and Management Judgement 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 unaudited consolidated financial statements have been prepared in accordance with generally accepted accounting principles for interim financial information Accordingly, these unaudited interim consolidated financial statements do not include all of the disclosures required by generally accepted accounting principles in the United States of America for complete financial statements and the rules of the SEC. These unaudited interim consolidated financial statements should be read in conjunction with the Companys audited financial statements for the year ended March 31, 2019. In the opinion of management, the unaudited interim consolidated financial statements furnished herein include all adjustments, all of which are of a normal recurring nature, necessary for a fair statement of the results for the interim periods presented. Operating results for the three month period ended June 30, 2019 are not necessarily indicative of the results that may be expected for the year ending March 31, 2020. |
Note 2. Summary of Significan_2
Note 2. Summary of Significant Accounting Policies: Going Concern (Policies) | 3 Months Ended |
Jun. 30, 2019 | |
Policies | |
Going Concern | Going Concern As shown in the accompanying financial statements, the Company has incurred cumulative operating losses since inception. As of June 30, 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 $30,972,173. The Company's working capital deficit is $4,657,077 (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) | 3 Months Ended |
Jun. 30, 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 recognize revenue when we have identified a contract with a customer, identify the performance obligations in the contract, determine the transaction prices, when we allocate the transaction prices to the performance obligation in the contract and we recognize revenue when or as the Company satisfies the performance 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: Fair Value Measures (Policies) | 3 Months Ended |
Jun. 30, 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 June 30, 2019 and March 31, 2019 the Company had conversion features embedded in its convertible notes payable. The fair value measurements of those derivatives, using a binomial valuation model, was $1,389,113 at June 30, 2019 and $2,147,415 at March 31, 2019 and is reported as convertible notes payable derivative liabilities on the balance sheet. The derivative liabilities are measured as Level 3 items. |
Note 2. Summary of Significan_5
Note 2. Summary of Significant Accounting Policies: Provision for Income Taxes (Policies) | 3 Months Ended |
Jun. 30, 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_6
Note 2. Summary of Significant Accounting Policies: Capitalization of Patent and Trademark Costs (Policies) | 3 Months Ended |
Jun. 30, 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 17 years. See Note 3. |
Note 2. Summary of Significan_7
Note 2. Summary of Significant Accounting Policies: Reclassification of Prior Year Presentation (Policies) | 3 Months Ended |
Jun. 30, 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 Significan_8
Note 2. Summary of Significant Accounting Policies: New Accounting Requirements and Disclosures (Policies) | 3 Months Ended |
Jun. 30, 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 ASU No. 2016-02, Leases (Topic 842), which establishes a comprehensive new lease accounting model. The new standard: (a) clarifies the definition of a lease; (b) requires a dual approach to lease classification similar to current lease classifications; and, (c) causes lessees to recognize leases on the balance sheet as a lease liability with a corresponding right-of-use asset for leases with a lease-term of more than twelve months. The standard is effective for calendar years beginning after December 15, 2018; no material impact to the reporting in the financial statements of the Company is expected from the adoption of this standard. |
Note 2. Summary of Significan_9
Note 2. Summary of Significant Accounting Policies: Use of Estimates (Policies) | 3 Months Ended |
Jun. 30, 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) | 3 Months Ended |
Jun. 30, 2019 | |
Tables/Schedules | |
Schedule of Patents and Trademarks | June 30, 2019 March 31, 2019 Patents and trademarks under development $ 217,744 $ 217,744 Patents issued 153,801 153,801 Less accumulated amortization (7,604) (3,759) 146,197 150,042 Patents, net $ 363,941 $ 367,786 |
Note 6. Notes Payable_ Schedule
Note 6. Notes Payable: Schedule of Convertible Note, Initial Consideration: $165,000 First Tranche with 10% Interest Rate (Tables) | 3 Months Ended |
Jun. 30, 2019 | |
Tables/Schedules | |
Schedule of Convertible Note, Initial Consideration: $165,000 First Tranche with 10% Interest Rate | 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 |
Note 6. Notes Payable_ Schedu_2
Note 6. Notes Payable: Schedule of Convertible Note, Second Tranche, $82,500 with 10% Interest Rate (Tables) | 3 Months Ended |
Jun. 30, 2019 | |
Tables/Schedules | |
Schedule of Convertible Note, Second Tranche, $82,500 with 10% Interest Rate | 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 04/12/19 $22,500 $(23,000) 5,361,305 $0.00429 04/16/19 $17,517 $(4,983) 1,161,539 $0.00429 04/22/19 $- $(17,517) 4,083,217 $0.00429 Total 8,024,179 |
Note 6. Notes Payable_ Schedu_3
Note 6. Notes Payable: Schedule of Convertible Note, $135,000 with 9% Interest Rate (Tables) | 3 Months Ended |
Jun. 30, 2019 | |
Tables/Schedules | |
Schedule of Convertible Note, $135,000 with 9% Interest Rate | 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 04/04/19 $56,000 $(21,000) 4,895,105 $0.00429 04/16/19 $29,000 $(27,000) 6,293,706 $0.00429 04/17/19 $- $(29,000) 6,759,907 $0.00429 |
Note 6. Notes Payable_ Schedu_4
Note 6. Notes Payable: Schedule of Convertible Note, $115,500 with 12% Interest Rate (Tables) | 3 Months Ended |
Jun. 30, 2019 | |
Tables/Schedules | |
Schedule of Convertible Note, $115,500 with 12% Interest Rate | 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 04/04/2019 $- $(4,000) 932,401 $0.00429 |
Note 6. Notes Payable_ Schedu_5
Note 6. Notes Payable: Schedule of Convertible Note, $157,500 with 9% Interest Rate, First Note (and Back End Note) (Tables) | 3 Months Ended |
Jun. 30, 2019 | |
Tables/Schedules | |
Schedule of Convertible Note, $157,500 with 9% Interest Rate, First Note (and Back End Note) | 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 04/01/19 $- $(1,000) 222,965 $0.004485 |
Note 6. Notes Payable_ Schedu_6
Note 6. Notes Payable: Schedule of Convertible Note, $107,000 with 10% Interest Rate (Tables) | 3 Months Ended |
Jun. 30, 2019 | |
Tables/Schedules | |
Schedule of Convertible Note, $107,000 with 10% Interest Rate | Conversion Date Principal Outstanding Principal Reduction Shares Issued Exercise Price 12/31/2018 $107,000 04/17/2019 $79,000 $(28,000) 6,526,807 $0.00429 04/30/2019 $47,000 $(32,000) 7,032,967 $0.00455 05/03/2019 $12,500 $(34,500) 7,582,418 $0.00455 05/16/2019 $- $(12,500) 2,236,136 $0.005589 |
Note 6. Notes Payable_ Schedu_7
Note 6. Notes Payable: Schedule of Convertible Note, $181,170 with 12% Interest Rate (Tables) | 3 Months Ended |
Jun. 30, 2019 | |
Tables/Schedules | |
Schedule of Convertible Note, $181,170 with 12% Interest Rate | Conversion Date Principal Outstanding Principal Reduction Shares Issued Exercise Price 12/31/2018 $181,170 04/17/2019 $168,261 $(12,909) 4,361,220 $0.00296 04/30/2019 $147,828 $(20,433) 8,374,250 $0.00244 |
Note 9. Income Taxes_ Schedule
Note 9. Income Taxes: Schedule of Significant components of the deferred tax asset amounts (Tables) | 3 Months Ended |
Jun. 30, 2019 | |
Tables/Schedules | |
Schedule of Significant components of the deferred tax asset amounts | June 30, 2019 March 31, 2019 Net operating losses carryforwards $ 4,291,650 $ 3,872,481 Deferred tax asset 901,247 813,221 Valuation allowance for deferred asset (901,247) (813,221) Net deferred tax asset $ - $ - |
Note 12. Stock Options and Wa_2
Note 12. Stock Options and Warrants: Schedule of assumptions used to estimate the fair values of the options and warrants (Tables) | 3 Months Ended |
Jun. 30, 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 $3.00 2.44 263.28% 5.00 30,195 675,195 Issued 675,195 (193,559) Exercised (193,559) (368,941) Forfeited (368,941) 112,695 Outstanding 112,695 Options* and Warrants Options and Warrants 19,205,195 Issued Vested 11,143,529 (218,559) Exercised Exercised (218,559) (1,418,941) Forfeited Forfeited (818,941) 17,567,695 Outstanding Unexercised 10,106,029 |
Note 1. Organization, Recent _5
Note 1. Organization, Recent History, and Description of Businesses-Present and Past: Description of Businesses: Present and Recent Past (Details) | 3 Months Ended |
Jun. 30, 2019 | |
Details | |
Entity Information, Former Legal or Registered Name | Butte Highlands Mining Corporation |
Entity Incorporation, Date of Incorporation | Jun. 16, 2016 |
Note 2. Summary of Significa_10
Note 2. Summary of Significant Accounting Policies: Going Concern (Details) - USD ($) | Jun. 30, 2019 | Mar. 31, 2019 |
Details | ||
Accumulated deficit | $ (30,972,173) | $ (27,967,566) |
Working capital deficit | $ 4,657,077 |
Note 2. Summary of Significa_11
Note 2. Summary of Significant Accounting Policies: Fair Value Measures (Details) - Conversion features embedded in convertible notes payable - USD ($) | 3 Months Ended | |
Jun. 30, 2019 | Mar. 31, 2019 | |
Share-based Compensation Arrangement by Share-based Payment Award, Fair Value Assumptions, Method Used | binomial valuation model | |
Convertible Notes Payable, Current | $ 1,389,113 | $ 2,147,415 |
Note 3. Patents_ Schedule of _2
Note 3. Patents: Schedule of Patents and Trademarks (Details) - USD ($) | Jun. 30, 2019 | Mar. 31, 2019 |
Details | ||
Patents and trademarks under development | $ 217,744 | $ 217,744 |
Patents issued | 153,801 | 153,801 |
Less accumulated amortization | (7,604) | (3,759) |
Patents, net | $ 363,941 | $ 367,786 |
Note 3. Patents (Details)
Note 3. Patents (Details) - USD ($) | 3 Months Ended | |
Jun. 30, 2019 | Mar. 31, 2019 | |
Details | ||
Amortization of Intangible Assets | $ 3,845 | $ 3,789 |
Note 4. Concentration of Cred_2
Note 4. Concentration of Credit Risk (Details) - USD ($) | Jun. 30, 2019 | Mar. 31, 2019 |
Details | ||
Time Deposits, at or Above FDIC Insurance Limit | $ 45,241 | $ 0 |
Note 6. Notes Payable_ Commitme
Note 6. Notes Payable: Commitment Note, $82,500 with 10% Interest Rate (Details) - Commitment Note with 10% Interest Rate | 3 Months Ended |
Jun. 30, 2019USD ($) | |
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 |
Note 6. Notes Payable_ Converti
Note 6. Notes Payable: Convertible Note, Initial Consideration: $165,000 First Tranche with 10% Interest Rate (Details) - Convertible Note, Initial Consideration: First Tranche with 10% Interest Rate | 3 Months Ended |
Jun. 30, 2019USD ($) | |
Debt Instrument, Issuance Date | Aug. 24, 2017 |
Debt Instrument, Description | convertible note |
Debt Instrument, Interest Rate, Stated Percentage | 10.00% |
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 |
Note 6. Notes Payable_ Schedu_8
Note 6. Notes Payable: Schedule of Convertible Note, Initial Consideration: $165,000 First Tranche with 10% Interest Rate (Details) | 3 Months Ended |
Jun. 30, 2019USD ($)$ / sharesshares | |
Convertible Note, Initial Consideration: First Tranche with 10% Interest Rate - Event 1 | |
Conversion Date | Dec. 31, 2017 |
Principal Outstanding | $ 165,000 |
Convertible Note, Initial Consideration: First Tranche with 10% Interest Rate - 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 |
Convertible Note, Initial Consideration: First Tranche with 10% Interest Rate - 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 |
Convertible Note, Initial Consideration: First Tranche with 10% Interest Rate - 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 |
Convertible Note, Initial Consideration: First Tranche with 10% Interest Rate - 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 |
Convertible Note, Initial Consideration: First Tranche with 10% Interest Rate - 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 |
Convertible Note, Initial Consideration: First Tranche with 10% Interest Rate - 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 |
Convertible Note, Initial Consideration: First Tranche with 10% Interest Rate - 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 |
Convertible Note, Initial Consideration: First Tranche with 10% Interest Rate | |
Shares Issued | shares | 4,588,586 |
Note 6. Notes Payable_ Conver_2
Note 6. Notes Payable: Convertible Note, Second Tranche, $82,500 with 10% Interest Rate (Details) - Convertible Note, Second Tranche with 10% Interest Rate | 3 Months Ended |
Jun. 30, 2019USD ($) | |
Debt Instrument, Issuance Date | Oct. 23, 2017 |
Debt Instrument, Face Amount | $ 82,500 |
Debt Instrument, Description | Convertible Note |
Proceeds from Loans | $ 75,000 |
Debt Instrument, Convertible, Beneficial Conversion Feature | $ 69,000 |
Note 6. Notes Payable_ Schedu_9
Note 6. Notes Payable: Schedule of Convertible Note, Second Tranche, $82,500 with 10% Interest Rate (Details) | 3 Months Ended |
Jun. 30, 2019USD ($)$ / sharesshares | |
Convertible Note, Second Tranche with 10% Interest Rate - Event 1 | |
Conversion Date | Dec. 31, 2018 |
Principal Outstanding | $ 82,500 |
Convertible Note, Second Tranche with 10% Interest Rate - 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 |
Convertible Note, Second Tranche with 10% Interest Rate - 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 |
Convertible Note, Second Tranche with 10% Interest Rate - 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 |
Convertible Note, Second Tranche with 10% Interest Rate - 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 |
Convertible Note, Second Tranche with 10% Interest Rate - Event 6 | |
Conversion Date | Apr. 12, 2019 |
Principal Outstanding | $ 22,500 |
Principal Reduction | $ (23,000) |
Shares Issued | shares | 5,361,305 |
Exercise Price | $ / shares | $ 0.00429 |
Convertible Note, Second Tranche with 10% Interest Rate - Event 7 | |
Conversion Date | Apr. 16, 2019 |
Principal Outstanding | $ 17,517 |
Principal Reduction | $ (4,983) |
Shares Issued | shares | 1,161,539 |
Exercise Price | $ / shares | $ 0.00429 |
Convertible Note, Second Tranche with 10% Interest Rate - Event 8 | |
Conversion Date | Apr. 22, 2019 |
Principal Outstanding | $ 0 |
Principal Reduction | $ (17,517) |
Shares Issued | shares | 4,083,217 |
Exercise Price | $ / shares | $ 0.00429 |
Convertible Note, Second Tranche with 10% Interest Rate | |
Shares Issued | shares | 8,024,179 |
Note 6. Notes Payable_ Conver_3
Note 6. Notes Payable: Convertible Note, Third Tranche, $82,500 with 10% Interest Rate (Details) - Convertible Note, Third Tranche with 10% Interest Rate | 3 Months Ended |
Jun. 30, 2019USD ($) | |
Debt Instrument, Issuance Date | Mar. 15, 2018 |
Debt Instrument, Face Amount | $ 82,500 |
Debt Instrument, Description | Convertible Note |
Proceeds from Loans | $ 75,000 |
Debt Instrument, Convertible, Beneficial Conversion Feature | $ 69,000 |
Note 6. Notes Payable_ Conver_4
Note 6. Notes Payable: Convertible Notes, 12% (Details) - Convertible Note, $88,000 with 12% Interest Rate | 3 Months Ended |
Jun. 30, 2019USD ($) | |
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 was 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 |
Note 6. Notes Payable_ Conver_5
Note 6. Notes Payable: Convertible Note, $53,000 with 12% Interest Rate (Details) - Convertible Note, $53,000 with 12% Interest Rate | 3 Months Ended |
Jun. 30, 2019USD ($) | |
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 was 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. |
Derivative Liability | $ 42,862 |
Share-based Compensation Arrangement by Share-based Payment Award, Fair Value Assumptions, Method Used | binomial pricing model |
Note 6. Notes Payable_ Working
Note 6. Notes Payable: Working Capital Loan for Services to New Customer by IronClad Pipeline IC, Inc (Details) | 3 Months Ended |
Jun. 30, 2019USD ($) | |
Working Capital Loan for Services to New Customer by IronClad Pipeline IC, Inc. with 8.5% Interest Rate | |
Debt Instrument, Issuance Date | Feb. 27, 2018 |
Debt Instrument, Face Amount | $ 255,000 |
Debt Instrument, Interest Rate, Stated Percentage | 8.50% |
Proceeds from Loans | $ 250,000 |
Long-term Debt | $ 475,000 |
Working Capital Loan for Services to New Customer by IronClad Pipeline IC, Inc. with 8.5% Interest Rate - additional | |
Debt Instrument, Issuance Date | Mar. 21, 2018 |
Debt Instrument, Face Amount | $ 245,000 |
Proceeds from Loans | $ 240,000 |
Note 6. Notes Payable_ Conver_6
Note 6. Notes Payable: Convertible Note, $250,000 with 10% Interest Rate (Details) - Convertible Note, $250,000 with 10% Interest Rate | 3 Months Ended |
Jun. 30, 2019USD ($) | |
Debt Instrument, Issuance Date | Jun. 26, 2018 |
Debt Instrument, Interest Rate, Stated Percentage | 10.00% |
Debt Instrument, Description | convertible note |
Debt Instrument, Face Amount | $ 250,000 |
Proceeds from Loans | 235,000 |
Payments of Debt Issuance Costs | $ 15,000 |
Debt Instrument, Maturity Date | Dec. 26, 2018 |
Debt Instrument, Convertible, Terms of Conversion Feature | convert the note into shares of common stock of the Company at any time on or following the date of the Note from the and ending on the later of i) the maturity date, or ii) the date of payment of a default amount, if any |
Derivative Liability | $ 189,211 |
Share-based Compensation Arrangement by Share-based Payment Award, Fair Value Assumptions, Method Used | binomial pricing model |
Note 6. Notes Payable_ Conver_7
Note 6. Notes Payable: Convertible Note, $135,000 with 9% Interest Rate (Details) | 3 Months Ended |
Jun. 30, 2019USD ($) | |
Convertible Note, $135,000 with 9% Interest Rate | |
Debt Instrument, Issuer | IronClad |
Debt Instrument, Interest Rate, Stated Percentage | 9.00% |
Debt Instrument, Description | convertible note payable |
Debt Instrument, Face Amount | $ 270,000 |
Long-term Debt, Fair Value | 126,500 |
Debt Instrument, Unamortized Discount, Current | $ 8,500 |
Debt Instrument, Maturity Date | Jul. 11, 2019 |
Debt Instrument, Convertible, Terms of Conversion Feature | , could convert the note into shares of common stock of the Company at any time during the period beginning on the date which was 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 |
Convertible Note, $135,000 with 9% Interest Rate - Back End Note | |
Debt Instrument, Convertible, Terms of Conversion Feature | it could not be repaid, but only converted |
Note 6. Notes Payable_ Sched_10
Note 6. Notes Payable: Schedule of Convertible Note, $135,000 with 9% Interest Rate (Details) | 3 Months Ended |
Jun. 30, 2019USD ($)$ / sharesshares | |
Convertible Note, $135,000 with 9% Interest Rate - Event 1 | |
Conversion Date | Dec. 31, 2018 |
Principal Outstanding | $ 135,000 |
Convertible Note, $135,000 with 9% Interest Rate - 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 |
Convertible Note, $135,000 with 9% Interest Rate - 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 |
Convertible Note, $135,000 with 9% Interest Rate - 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 |
Convertible Note, $135,000 with 9% Interest Rate - 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 |
Convertible Note, $135,000 with 9% Interest Rate - Event 6 | |
Conversion Date | Apr. 4, 2019 |
Principal Outstanding | $ 56,000 |
Principal Reduction | $ (21,000) |
Shares Issued | shares | 4,895,105 |
Exercise Price | $ / shares | $ 0.00429 |
Convertible Note, $135,000 with 9% Interest Rate - Event 7 | |
Conversion Date | Apr. 16, 2019 |
Principal Outstanding | $ 29,000 |
Principal Reduction | $ (27,000) |
Shares Issued | shares | 6,293,706 |
Exercise Price | $ / shares | $ 0.00429 |
Convertible Note, $135,000 with 9% Interest Rate - Event 8 | |
Conversion Date | Apr. 17, 2019 |
Principal Outstanding | $ 0 |
Principal Reduction | $ (29,000) |
Shares Issued | shares | 6,759,907 |
Exercise Price | $ / shares | $ 0.00429 |
Note 6. Notes Payable_ Conver_8
Note 6. Notes Payable: Convertible Note, $115,500 with 12% Interest Rate (Details) - Convertible Note, $115,500 with 12% Interest Rate | 3 Months Ended |
Jun. 30, 2019USD ($) | |
Debt Instrument, Issuance Date | Jul. 17, 2018 |
Debt Instrument, Issuer | IronClad |
Debt Instrument, Interest Rate, Stated Percentage | 12.00% |
Debt Instrument, Description | convertible note |
Long-term Debt, Fair Value | $ 115,500 |
Proceeds from Loans | $ 101,500 |
Debt Instrument, Maturity Date | Jul. 18, 2019 |
Debt Instrument, Convertible, Terms of Conversion Feature | 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 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 |
Note 6. Notes Payable_ Sched_11
Note 6. Notes Payable: Schedule of Convertible Note, $115,500 with 12% Interest Rate (Details) | 3 Months Ended |
Jun. 30, 2019USD ($)$ / sharesshares | |
Convertible Note, $115,500 with 12% Interest Rate - Event 1 | |
Conversion Date | Dec. 31, 2018 |
Principal Outstanding | $ 115,500 |
Convertible Note, $115,500 with 12% Interest Rate - 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 |
Convertible Note, $115,500 with 12% Interest Rate - 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 |
Convertible Note, $115,500 with 12% Interest Rate - 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 |
Convertible Note, $115,500 with 12% Interest Rate - 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 |
Convertible Note, $115,500 with 12% Interest Rate - 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 |
Convertible Note, $115,500 with 12% Interest Rate - 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 |
Convertible Note, $115,500 with 12% Interest Rate - 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 |
Convertible Note, $115,500 with 12% Interest Rate - 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 |
Convertible Note, $115,500 with 12% Interest Rate - Event 10 | |
Conversion Date | Apr. 4, 2019 |
Principal Outstanding | $ 0 |
Principal Reduction | $ (4,000) |
Shares Issued | shares | 932,401 |
Exercise Price | $ / shares | $ 0.00429 |
Note 6. Notes Payable_ Conver_9
Note 6. Notes Payable: Convertible Note, $157,500 with 9% Interest Rate, First Note (and Back End Note) (Details) | 3 Months Ended |
Jun. 30, 2019USD ($) | |
Convertible Note, $157,500 with 9% Interest Rate, First Note (and Back End Note) | |
Debt Instrument, Issuance Date | Jul. 19, 2018 |
Debt Instrument, Interest Rate, Stated Percentage | 9.00% |
Debt Instrument, Description | convertible note |
Debt Instrument, Face Amount | $ 315,000 |
Proceeds from Loans | 142,500 |
Payments of Debt Issuance Costs | $ 15,000 |
Debt Instrument, Maturity Date | Jul. 19, 2019 |
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 180 days following the date of the note (dated July 19, 2018) and ending on the later of i) the maturity date, or ii) the date of payment of a default amount, if any |
Convertible Note, $157,500 with 9% Interest Rate, First Note (and Back End Note) - Back End Note | |
Debt Instrument, Convertible, Terms of Conversion Feature | it may not be repaid in cash, but only converted |
Note 6. Notes Payable_ Sched_12
Note 6. Notes Payable: Schedule of Convertible Note, $157,500 with 9% Interest Rate, First Note (and Back End Note) (Details) | 3 Months Ended |
Jun. 30, 2019USD ($)$ / sharesshares | |
Convertible Note, $157,500 with 9% Interest Rate, First Note (and Back End Note) - Event 1 | |
Conversion Date | Dec. 31, 2018 |
Principal Outstanding | $ 157,500 |
Convertible Note, $157,500 with 9% Interest Rate, First Note (and Back End Note) - 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 |
Convertible Note, $157,500 with 9% Interest Rate, First Note (and Back End Note) - 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 |
Convertible Note, $157,500 with 9% Interest Rate, First Note (and Back End Note) - 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 |
Convertible Note, $157,500 with 9% Interest Rate, First Note (and Back End Note) - 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 |
Convertible Note, $157,500 with 9% Interest Rate, First Note (and Back End Note) - 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 |
Convertible Note, $157,500 with 9% Interest Rate, First Note (and Back End Note) - 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 |
Convertible Note, $157,500 with 9% Interest Rate, First Note (and Back End Note) - 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 |
Convertible Note, $157,500 with 9% Interest Rate, First Note (and Back End Note) - 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 |
Convertible Note, $157,500 with 9% Interest Rate, First Note (and Back End Note) - 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 |
Convertible Note, $157,500 with 9% Interest Rate, First Note (and Back End Note) - 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 |
Convertible Note, $157,500 with 9% Interest Rate, First Note (and Back End Note) - Event 12 | |
Conversion Date | Apr. 1, 2019 |
Principal Outstanding | $ 0 |
Principal Reduction | $ (1,000) |
Shares Issued | shares | 222,965 |
Exercise Price | $ / shares | $ 0.004485 |
Note 6. Notes Payable_ Conve_10
Note 6. Notes Payable: Convertible Note, $157,500 with 9% Interest Rate, Back End Note (Details) - Convertible Note, $157,500 with 9% Interest Rate, Back End Note | 3 Months Ended |
Jun. 30, 2019 | |
Debt Instrument, Description | Back End Note |
Debt Instrument, Issuance Date | Mar. 14, 2019 |
Debt Instrument, Maturity Date | Jul. 19, 2019 |
Debt Instrument, Interest Rate, Stated Percentage | 9.00% |
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 March 14, 2019) and ending on the later of i) the maturity date, or ii) the date of payment of a default amount, if any |
Note 6. Notes Payable_ Conve_11
Note 6. Notes Payable: Convertible Note, $107,000 with 10% Interest Rate (Details) | 3 Months Ended |
Jun. 30, 2019USD ($) | |
Convertible Note, $107,000 with 10% Interest Rate | |
Debt Instrument, Issuance Date | Oct. 24, 2018 |
Debt Instrument, Interest Rate, Stated Percentage | 10.00% |
Debt Instrument, Description | convertible note |
Debt Instrument, Face Amount | $ 107,000 |
Proceeds from Loans | 102,000 |
Payments of Debt Issuance Costs | $ 5,000 |
Debt Instrument, Maturity Date | Oct. 24, 2019 |
Debt Instrument, Convertible, Terms of Conversion Feature | convert all or any amount of the principal face amount of the Note then outstanding into shares of the Company's common stock |
Convertible Note, $107,000 carrying 10% Interest Rate | |
Debt Instrument, Issuance Date | Feb. 14, 2019 |
Debt Instrument, Interest Rate, Stated Percentage | 10.00% |
Debt Instrument, Description | convertible note |
Debt Instrument, Face Amount | $ 107,000 |
Proceeds from Loans | $ 102,000 |
Debt Instrument, Maturity Date | Feb. 14, 2020 |
Debt Instrument, Convertible, Terms of Conversion Feature | 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 |
Debt Instrument, Issuer | IronClad |
Note 6. Notes Payable_ Sched_13
Note 6. Notes Payable: Schedule of Convertible Note, $107,000 with 10% Interest Rate (Details) | 3 Months Ended |
Jun. 30, 2019USD ($)$ / sharesshares | |
Convertible Note, $107,000 with 10% Interest Rate - Event 1 | |
Conversion Date | Dec. 31, 2018 |
Principal Outstanding | $ 107,000 |
Convertible Note, $107,000 with 10% Interest Rate - Event 2 | |
Conversion Date | Apr. 17, 2019 |
Principal Outstanding | $ 79,000 |
Principal Reduction | $ (28,000) |
Shares Issued | shares | 6,526,807 |
Exercise Price | $ / shares | $ 0.00429 |
Convertible Note, $107,000 with 10% Interest Rate - Event 3 | |
Conversion Date | Apr. 30, 2019 |
Principal Outstanding | $ 47,000 |
Principal Reduction | $ (32,000) |
Shares Issued | shares | 7,032,967 |
Exercise Price | $ / shares | $ 0.00455 |
Convertible Note, $107,000 with 10% Interest Rate - Event 4 | |
Conversion Date | May 3, 2019 |
Principal Outstanding | $ 12,500 |
Principal Reduction | $ (34,500) |
Shares Issued | shares | 7,582,418 |
Exercise Price | $ / shares | $ 0.00455 |
Convertible Note, $107,000 with 10% Interest Rate - Event 5 | |
Conversion Date | May 16, 2019 |
Principal Outstanding | $ 0 |
Principal Reduction | $ (12,500) |
Shares Issued | shares | 2,236,136 |
Exercise Price | $ / shares | $ 0.005589 |
Note 6. Notes Payable_ Conve_12
Note 6. Notes Payable: Convertible Note, $181,170 with 12% Interest Rate (Details) - Convertible Note, $181,170 with 12% Interest Rate | 3 Months Ended |
Jun. 30, 2019USD ($) | |
Debt Instrument, Issuance Date | Oct. 26, 2018 |
Debt Instrument, Interest Rate, Stated Percentage | 12.00% |
Debt Instrument, Description | convertible note |
Debt Instrument, Face Amount | $ 181,170 |
Proceeds from Loans | 150,346 |
Payments of Debt Issuance Costs | $ 30,824 |
Debt Instrument, Maturity Date | Jul. 26, 2019 |
Debt Instrument, Convertible, Terms of Conversion Feature | at any time following the 180th calendar day after the issue date (October 26, 2018), and ending on the later of i) the maturity date, or ii) the date of payment of a default amount, if any, to convert all or any amount of the principal face amount of the Note then outstanding into shares of the Company's common stock |
Note 6. Notes Payable_ Sched_14
Note 6. Notes Payable: Schedule of Convertible Note, $181,170 with 12% Interest Rate (Details) | 3 Months Ended |
Jun. 30, 2019USD ($)$ / sharesshares | |
Convertible Note, $181,170 with 12% Interest Rate - Event 1 | |
Conversion Date | Dec. 31, 2018 |
Principal Outstanding | $ 181,170 |
Convertible Note, $181,170 with 12% Interest Rate - Event 2 | |
Conversion Date | Apr. 17, 2019 |
Principal Outstanding | $ 168,261 |
Principal Reduction | $ (12,909) |
Shares Issued | shares | 4,361,220 |
Exercise Price | $ / shares | $ 0.00296 |
Convertible Note, $181,170 with 12% Interest Rate - Event 3 | |
Conversion Date | Apr. 30, 2019 |
Principal Outstanding | $ 147,828 |
Principal Reduction | $ (20,433) |
Shares Issued | shares | 8,374,250 |
Exercise Price | $ / shares | $ 0.00244 |
Note 6. Notes Payable_ Conve_13
Note 6. Notes Payable: Convertible Note, $57,500 with 12% Interest Rate (Details) - Convertible Note, $57,500 with 12% Interest Rate | 3 Months Ended |
Jun. 30, 2019USD ($) | |
Debt Instrument, Issuance Date | Feb. 14, 2019 |
Debt Instrument, Issuer | IronClad |
Debt Instrument, Description | convertible note |
Debt Instrument, Face Amount | $ 57,500 |
Proceeds from Loans | $ 52,500 |
Debt Instrument, Maturity Date | Feb. 14, 2020 |
Debt Instrument, Interest Rate, Stated Percentage | 12.00% |
Debt Instrument, Convertible, Terms of Conversion Feature | Holder of the note, at its sole election, may convert the note into shares of common stock of Company 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 |
Note 6. Notes Payable_ Conve_14
Note 6. Notes Payable: Convertible Note, $86,250 with 12% Interest Rate, First Note (and Back End and Collateralized Notes) (Details) - Convertible Note, $86,250 with 12% Interest Rate, First Note (and Back End and Collateralized Notes) | 3 Months Ended |
Jun. 30, 2019USD ($) | |
Debt Instrument, Issuance Date | Mar. 28, 2019 |
Debt Instrument, Issuer | IronClad |
Debt Instrument, Interest Rate, Stated Percentage | 12.00% |
Debt Instrument, Description | convertible note |
Debt Instrument, Face Amount | $ 172,500 |
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 March 28, 2019) and ending on the later of i) the maturity date, or ii) the date of payment of a default amount, if any |
Note 6. Notes Payable_ Conve_15
Note 6. Notes Payable: Convertible Note, $43,200 with 8% Interest Rate, First Note (and Back End and Collateralized Notes) (Details) - Convertible Note, $43,200 with 8% Interest Rate, First Note (and Back End and Collateralized Notes) | 3 Months Ended |
Jun. 30, 2019USD ($) | |
Debt Instrument, Issuance Date | Apr. 12, 2019 |
Debt Instrument, Issuer | IronClad |
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 |
Note 6. Notes Payable_ Conve_16
Note 6. Notes Payable: Convertible Note, $57,750 with 12% Interest Rate (Details) - Convertible Note, $57,750 with 12% Interest Rate | 3 Months Ended |
Jun. 30, 2019USD ($) | |
Debt Instrument, Issuance Date | Apr. 23, 2019 |
Debt Instrument, Issuer | IronClad |
Debt Instrument, Description | convertible note |
Debt Instrument, Face Amount | $ 57,750 |
Proceeds from Loans | $ 50,000 |
Debt Instrument, Maturity Date | Apr. 23, 2020 |
Debt Instrument, Interest Rate, Stated Percentage | 12.00% |
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 |
Note 6. Notes Payable_ Conve_17
Note 6. Notes Payable: Convertible Note, $150,000 with 10% Interest Rate (Details) - Convertible Note, $150,000 with 10% Interest Rate | 3 Months Ended |
Jun. 30, 2019USD ($) | |
Debt Instrument, Issuance Date | May 15, 2019 |
Debt Instrument, Issuer | IronClad |
Debt Instrument, Interest Rate, Stated Percentage | 10.00% |
Debt Instrument, Description | convertible note |
Debt Instrument, Face Amount | $ 150,000 |
Proceeds from Loans | $ 142,500 |
Debt Instrument, Convertible, Terms of Conversion Feature | 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 |
Note 7. Preferred and Common _2
Note 7. Preferred and Common Stock (Details) - USD ($) | 3 Months Ended | |
Jun. 30, 2019 | Mar. 31, 2019 | |
Three-month period ended March 31, 2017 | ||
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 ($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. | |
Three-month period ended June 30, 2017 | ||
Sale of Stock, Description of Transaction | 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 | |
Three-month period ended September 30, 2017 | ||
Sale of Stock, Description of Transaction | 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 | |
Three-month period ended December 31, 2017 | ||
Sale of Stock, Description of Transaction | 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 January 24, 2018 | ||
Sale of Stock, Description of Transaction | IronClad issued, under the terms of the Investment Agreement, 14,331 shares of its Class A stock | |
On January 23, 2018 | ||
Sale of Stock, Description of Transaction | Company issued 10,000 shares of its Class A common stock | |
On March 13, 2018 | ||
Sale of Stock, Description of Transaction | 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 | |
Period ended March 31, 2018 | ||
Sale of Stock, Description of Transaction | Company approved for issue a total of 50,322 shares of Class A common stock, priced between $1.40 and $1.82 | |
At the March 31, 2018 year end | ||
Sale of Stock, Description of Transaction | 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 | ||
Sale of Stock, Description of Transaction | 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 | ||
Sale of Stock, Description of Transaction | 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 | |
Class A Common Stock Issuance #1 | ||
Shares, Issued | 2,112,711 | 80,972 |
Sale of Stock, Price Per Share | $ 0.004485 | $ 0.1235 |
Stock Issued | $ 10,000 | |
Class A Common Stock Issuance #2 | ||
Shares, Issued | 5,214,962 | 97,371 |
Sale of Stock, Price Per Share | $ 0.00429 | $ 0.0975659 |
Class A Common Stock Issuance #3 | ||
Shares, Issued | 3,018,145 | 100,000 |
Sale of Stock, Price Per Share | $ 0.00429 | $ 0.0975659 |
Stock Issued | $ 4,600 | |
Class A Common Stock Issuance #4 | ||
Shares, Issued | 5,361,305 | 2,123,643 |
Sale of Stock, Price Per Share | $ 0.00429 | $ 0.2119 |
Stock Issued | $ 23,000 | $ 45,000 |
Class A Common Stock Issuance #5 | ||
Shares, Issued | 6,723,575 | 8,398,048 |
Sale of Stock, Price Per Share | $ 0.00429 | $ 0.0195 |
Class A Common Stock Issuance #6 | ||
Shares, Issued | 7,223,284 | 7,474,770 |
Sale of Stock, Price Per Share | $ 0.00429 | |
Class A Common Stock Issuance #7 | ||
Shares, Issued | 10,742,597 | 2,760,181 |
Sale of Stock, Price Per Share | $ 0.00429 | $ 0.01105 |
Class A Common Stock Issuance #8 | ||
Shares, Issued | 6,836,159 | 921,451 |
Sale of Stock, Price Per Share | $ 0.00429 | $ 0.00975 |
Class A Common Stock Issuance #9 | ||
Shares, Issued | 28,972,086 | 1,923,077 |
Sale of Stock, Price Per Share | $ 0.00429 | $ 0.0078 |
Stock Issued | $ 15,000 | |
Class A Common Stock Issuance #10 | ||
Shares, Issued | 7,393,286 | 2,105,264 |
Sale of Stock, Price Per Share | $ 0.00455 | $ 0.006175 |
Class A Common Stock Issuance #11 | ||
Shares, Issued | 21,214,413 | 8,714,984 |
Sale of Stock, Price Per Share | $ 0.00455 | $ 0.0056225 |
Class A Common Stock Issuance #12 | ||
Shares, Issued | 7,975,042 | 2,876,192 |
Sale of Stock, Price Per Share | $ 0.00455 | $ 0.004615 |
Class A Common Stock Issuance #13 | ||
Shares, Issued | 8,333,300 | 34,204,012 |
Sale of Stock, Price Per Share | $ 0.00296 | $ 0.004485 |
Class A Common Stock Issuance #14 | ||
Shares, Issued | 9,695,513 | 240,384 |
Sale of Stock, Price Per Share | $ 0.00468 | |
Stock Issued | $ 165,865 | |
Class A Common Stock Issuance #15 | ||
Shares, Issued | 2,360,503 | |
Sale of Stock, Price Per Share | $ 0.005590 | |
Class A Common Stock Issuance #16 | ||
Shares, Issued | 19,180,871 | |
Sale of Stock, Price Per Share | $ 0.0056225 | |
Class A Common Stock Issuance #17 | ||
Shares, Issued | 9,350,000 | |
Sale of Stock, Price Per Share | $ 0.00244 |
Note 8. General and Administr_2
Note 8. General and Administrative Expenses (Details) - USD ($) | 3 Months Ended | |
Jun. 30, 2019 | Jun. 30, 2018 | |
Details | ||
General and Administrative Expense | $ 430,516 | $ 607,389 |
Compensation expenses in connection with the issuance of stock options or warrants | $ 338,348 | $ 548,078 |
Note 9. Income Taxes_ Schedul_2
Note 9. Income Taxes: Schedule of Significant components of the deferred tax asset amounts (Details) - USD ($) | Jun. 30, 2019 | Mar. 31, 2019 |
Details | ||
Net operating losses carryforwards | $ 4,291,650 | $ 3,872,481 |
Deferred tax asset | 901,247 | 813,221 |
Valuation allowance for deferred asset | (901,247) | (813,221) |
Net deferred tax asset | $ 0 | $ 0 |
Note 9. Income Taxes (Details)
Note 9. Income Taxes (Details) - USD ($) | Jun. 30, 2019 | Mar. 31, 2019 |
Details | ||
Net operating losses carryforwards | $ 4,291,650 | $ 3,872,481 |
Note 10. Share Exchange Agree_2
Note 10. Share Exchange Agreement (Details) | Jan. 06, 2017USD ($) |
Details | |
Restricted shares issued | $ 56,655,891 |
Note 11. Share Based Compensa_2
Note 11. 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 12. Stock Options and Wa_3
Note 12. Stock Options and Warrants (Details) - USD ($) | Mar. 31, 2018 | Dec. 31, 2017 | Mar. 31, 2019 | Dec. 31, 2018 | Jun. 30, 2018 | 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 | 2,700,000 | 100,000 | 700,195 | 122,500 | ||||
Shares Granted, Value, Share-based Payment Arrangement, before Forfeiture | $ 4,873,048 | $ 31,994 | $ 137,058 | $ 123,719 | ||||
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 12. Stock Options and Wa_4
Note 12. Stock Options and Warrants: Schedule of assumptions used to estimate the fair values of the options and warrants (Details) | 3 Months Ended | |
Jun. 30, 2019$ / sharesshares | ||
Option #1 | ||
Number | 75,000 | [1] |
Date Issued | Jan. 16, 2017 | |
Exercise Price | $ / shares | $ 0.75 | |
Risk-free Interest Rate | 1.54% | |
Volatility | 226.01% | |
Life in Years | 3 | |
Vested | 75,000 | [1] |
Option #2 | ||
Number | 6,000,000 | [1] |
Date Issued | Jan. 20, 2017 | |
Exercise Price | $ / shares | $ 0.15 | |
Risk-free Interest Rate | 1.54% | |
Volatility | 220.00% | |
Life in Years | 3 | |
Vested | 3,000,000 | [1] |
Option #3 | ||
Number | 3,000,000 | [1] |
Date Issued | Jan. 20, 2017 | |
Exercise Price | $ / shares | $ 0.15 | |
Risk-free Interest Rate | 1.54% | |
Volatility | 220.00% | |
Life in Years | 4 | |
Vested | 2,000,000 | [1] |
Option #4 | ||
Number | 350,000 | [1],[2] |
Date Issued | Jan. 31, 2017 | |
Exercise Price | $ / shares | $ 0.15 | |
Risk-free Interest Rate | 1.19% | |
Volatility | 132.84% | |
Life in Years | 1.93 | |
Vested | 350,000 | [1],[2] |
Option #5 | ||
Number | 100,000 | [1],[2] |
Date Issued | Feb. 1, 2017 | |
Exercise Price | $ / shares | $ 0.15 | |
Risk-free Interest Rate | 1.22% | |
Volatility | 134.90% | |
Life in Years | 2 | |
Vested | 100,000 | [1],[2] |
Option #6 | ||
Number | 100,000 | [1],[3] |
Date Issued | Mar. 13, 2017 | |
Exercise Price | $ / shares | $ 0.15 | |
Risk-free Interest Rate | 1.40% | |
Volatility | 144.84% | |
Life in Years | 2 | |
Vested | 100,000 | [1],[3] |
Option #7 | ||
Number | 20,000 | [1] |
Date Issued | Mar. 21, 2017 | |
Exercise Price | $ / shares | $ 0.15 | |
Risk-free Interest Rate | 1.54% | |
Volatility | 233.07% | |
Life in Years | 3 | |
Vested | 20,000 | [1] |
Option #8 | ||
Number | 5,000 | [1] |
Date Issued | Apr. 30, 2017 | |
Exercise Price | $ / shares | $ 0.75 | |
Risk-free Interest Rate | 1.45% | |
Volatility | 219.35% | |
Life in Years | 3 | |
Vested | 5,000 | [1] |
Option #9 | ||
Number | 1,700,000 | [1] |
Date Issued | May 5, 2017 | |
Exercise Price | $ / shares | $ 1.47 | |
Risk-free Interest Rate | 1.71% | |
Volatility | 565.34% | |
Life in Years | 4 | |
Vested | 850,000 | [1] |
Option #10 | ||
Number | 1,000,000 | [1] |
Date Issued | May 5, 2017 | |
Exercise Price | $ / shares | $ 1.47 | |
Risk-free Interest Rate | 1.32% | |
Volatility | 202.99% | |
Life in Years | 2 | |
Vested | 1,000,000 | [1] |
Option #11 | ||
Number | 80,000 | [1] |
Date Issued | May 31, 2017 | |
Exercise Price | $ / shares | $ 0.75 | |
Risk-free Interest Rate | 1.44% | |
Volatility | 196.06% | |
Life in Years | 3 | |
Vested | 80,000 | [1] |
Option #12 | ||
Number | 660,000 | [1],[2] |
Date Issued | Jun. 12, 2017 | |
Exercise Price | $ / shares | $ 2.50 | |
Risk-free Interest Rate | 1.64% | |
Volatility | 589.85% | |
Life in Years | 4 | |
Vested | 230,000 | [1] |
Option #13 | ||
Number | 5,000 | [1] |
Date Issued | Jun. 30, 2017 | |
Exercise Price | $ / shares | $ 3.49 | |
Risk-free Interest Rate | 1.55% | |
Volatility | 197.13% | |
Life in Years | 3 | |
Vested | 5,000 | [1] |
Option #14 | ||
Number | 300,000 | [1] |
Date Issued | Jul. 26, 2017 | |
Exercise Price | $ / shares | $ 3.16 | |
Risk-free Interest Rate | 1.63% | |
Volatility | 296.38% | |
Life in Years | 4 | |
Vested | 150,000 | [1] |
Option #15 | ||
Number | 5,000 | [1] |
Date Issued | Jul. 31, 2017 | |
Exercise Price | $ / shares | $ 3.50 | |
Risk-free Interest Rate | 1.51% | |
Volatility | 170.61% | |
Life in Years | 3 | |
Vested | 5,000 | [1] |
Option #16 | ||
Number | 37,500 | [1] |
Date Issued | Aug. 25, 2017 | |
Exercise Price | $ / shares | $ 2.50 | |
Risk-free Interest Rate | 1.62% | |
Volatility | 170.38% | |
Life in Years | 3 | |
Vested | 37,500 | [1] |
Option #17 | ||
Number | 25,000 | [1] |
Date Issued | Aug. 31, 2017 | |
Exercise Price | $ / shares | $ 3.75 | |
Risk-free Interest Rate | 1.44% | |
Volatility | 170.57% | |
Life in Years | 3 | |
Vested | 25,000 | [1] |
Option #18 | ||
Number | 37,500 | [1] |
Date Issued | Oct. 26, 2017 | |
Exercise Price | $ / shares | $ 4.50 | |
Risk-free Interest Rate | 1.76% | |
Volatility | 220.28% | |
Life in Years | 3 | |
Vested | 37,500 | [1] |
Option #19 | ||
Number | 25,000 | [1] |
Date Issued | Jan. 25, 2018 | |
Exercise Price | $ / shares | $ 2.70 | |
Risk-free Interest Rate | 2.20% | |
Volatility | 247.35% | |
Life in Years | 3 | |
Vested | 25,000 | [1] |
Option #20 | ||
Number | 25,000 | [1] |
Date Issued | Mar. 2, 2018 | |
Exercise Price | $ / shares | $ 1.80 | |
Risk-free Interest Rate | 2.52% | |
Volatility | 297.39% | |
Life in Years | 3.84 | |
Vested | 25,000 | [1] |
Option #21 | ||
Number | 400,000 | [1] |
Date Issued | Mar. 2, 2018 | |
Exercise Price | $ / shares | $ 1.80 | |
Risk-free Interest Rate | 2.71% | |
Volatility | 369.15% | |
Life in Years | 5.84 | |
Vested | 134,000 | [1] |
Option #22 | ||
Number | 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 in Years | 6.84 | |
Vested | 1,601,000 | [1] |
Option #23 | ||
Number | 350,000 | [1] |
Date Issued | Mar. 2, 2018 | |
Exercise Price | $ / shares | $ 1.80 | |
Risk-free Interest Rate | 2.79% | |
Volatility | 395.11% | |
Life in Years | 7.84 | |
Vested | 116,667 | [1] |
Option #24 | ||
Number | 20,000 | [1] |
Date Issued | Apr. 2, 2018 | |
Exercise Price | $ / shares | $ 1.69 | |
Risk-free Interest Rate | 2.55% | |
Volatility | 372.73% | |
Life in Years | 4.75 | |
Vested | 20,000 | [1] |
Option #25 | ||
Number | 20,000 | [1] |
Date Issued | May 1, 2018 | |
Exercise Price | $ / shares | $ 1.20 | |
Risk-free Interest Rate | 2.82% | |
Volatility | 365.73% | |
Life in Years | 4.67 | |
Vested | 20,000 | [1] |
Option #26 | ||
Number | 20,000 | [1] |
Date Issued | Jun. 6, 2018 | |
Exercise Price | $ / shares | $ 1.14 | |
Risk-free Interest Rate | 2.81% | |
Volatility | 312.26% | |
Life in Years | 4.57 | |
Vested | 20,000 | [1] |
Option #27 | ||
Number | 270,000 | [1] |
Date Issued | Oct. 11, 2018 | |
Exercise Price | $ / shares | $ 0.32 | |
Risk-free Interest Rate | 2.97% | |
Volatility | 361.56% | |
Life in Years | 2.97 | |
Vested | 270,000 | [1] |
Option #28 | ||
Number | 500,000 | [1] |
Date Issued | Dec. 19, 2018 | |
Exercise Price | $ / shares | $ 0.15 | |
Risk-free Interest Rate | 2.62% | |
Volatility | 488.82% | |
Life in Years | 6.4 | |
Vested | 166,667 | [1] |
Options | ||
Number | 18,530,000 | [1] |
Vested | 10,468,334 | [1] |
Number of Options Exercised | (25,000) | [1],[3] |
Vested Options, Exercised | (25,000) | [1],[3] |
Number of Options Forfeited | (1,050,000) | [1],[2] |
Vested Options Forfeited | (450,000) | [1],[2] |
Number of Options Unexercised | 17,455,000 | [1] |
Vested Options, Unexercised | 9,993,334 | [1] |
Warrant #1 | ||
Number | 500,000 | [2],[3] |
Date Issued | Mar. 15, 2017 | |
Exercise Price | $ / shares | $ 0.15 | |
Risk-free Interest Rate | 1.02% | |
Volatility | 114.94% | |
Life in Years | 1.40 | |
Vested | 500,000 | [2],[3] |
Warrant #2 | ||
Number | 82,500 | [1] |
Date Issued | Aug. 24, 2017 | |
Exercise Price | $ / shares | $ 3.50 | |
Risk-free Interest Rate | 1.63% | |
Volatility | 285.16% | |
Life in Years | 4 | |
Vested | 82,500 | [1] |
Warrant #3 | ||
Number | 62,500 | [3] |
Date Issued | Jun. 6, 2018 | |
Exercise Price | $ / shares | $ 3 | |
Risk-free Interest Rate | 2.69% | |
Volatility | 311.00% | |
Life in Years | 4 | |
Vested | 62,500 | [3] |
Warrant #4 | ||
Number | 30,195 | [1] |
Date Issued | Oct. 26, 2018 | |
Exercise Price | $ / shares | $ 3 | |
Risk-free Interest Rate | 2.44% | |
Volatility | 263.28% | |
Life in Years | 5 | |
Vested | 30,195 | [1] |
Warrants | ||
Number | 675,195 | [1] |
Vested | 675,195 | [1] |
Number of Options Exercised | (193,559) | [3] |
Vested Options, Exercised | (193,559) | [3] |
Number of Options Forfeited | (368,941) | [2] |
Vested Options Forfeited | (368,941) | [2] |
Number of Options Outstanding | 112,695 | [1] |
Vested Options Outstanding | 112,695 | [1] |
Options and Warrants | ||
Number | 19,205,195 | [1] |
Vested | 11,143,529 | [1] |
Number of Options Exercised | (218,559) | [1],[3] |
Vested Options, Exercised | (218,559) | [1],[3] |
Vested Options Forfeited | (818,941) | [1] |
Number of Options Outstanding | 17,567,695 | [1] |
Vested Options Outstanding | 10,106,029 | [1] |
Optios and Warrants Forfeited | (1,418,941) | [1] |
[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. 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 $121,011. |
Note 14. Subsequent Events (Det
Note 14. Subsequent Events (Details) - Event 1 | 3 Months Ended |
Jun. 30, 2019USD ($)shares | |
Subsequent Event, Description | 1,098,901 shares of Class A common stock were issued |
Shares, Issued | shares | 1,098,901 |
Sale of Stock, Description of Transaction | shares of Class A common stock were issued |
Stock Issued | $ | $ 5,000 |