Document and Entity Information
Document and Entity Information | 9 Months Ended |
Sep. 30, 2016shares | |
Document and Entity Information: | |
Entity Registrant Name | Wrapmail, Inc. |
Document Type | 10-Q |
Document Period End Date | Sep. 30, 2016 |
Trading Symbol | wrap |
Amendment Flag | false |
Entity Central Index Key | 1,509,957 |
Current Fiscal Year End Date | --12-31 |
Entity Common Stock, Shares Outstanding | 146,008,250 |
Entity Filer Category | Smaller Reporting Company |
Entity Current Reporting Status | Yes |
Entity Voluntary Filers | No |
Entity Well-known Seasoned Issuer | No |
Document Fiscal Year Focus | 2,016 |
Document Fiscal Period Focus | Q3 |
WRAPmail, Inc. and Subsidiary -
WRAPmail, Inc. and Subsidiary - Consolidated Balance Sheets - USD ($) | Sep. 30, 2016 | Dec. 31, 2015 | |
Current Assets: | |||
Cash and cash equivalents | $ 1,475 | $ 18,373 | |
Accounts receivable, less allowance for doubtful accounts | [1] | 27,454 | 24,473 |
Prepaid expenses | 39,671 | ||
TOTAL CURRENT ASSETS | 28,929 | 82,517 | |
Property and equipment, less accumulated depreciation | [2] | 15,182 | 17,642 |
Other Assets: | |||
Security Deposit | 11,687 | 11,687 | |
Note receivable | 39,000 | 39,000 | |
Intangible assets, net of accumulated amortization | [3] | 27,475 | 29,455 |
Total other assets | 77,162 | 80,142 | |
Total Assets | 121,273 | 180,301 | |
Current Liabilities: | |||
Notes and loans payable | 94,933 | 8,000 | |
Accounts payable | 57,394 | 37,749 | |
Accrued expenses payable | 160,626 | 31,264 | |
Total current liabilities and total liabilities | 312,953 | 77,013 | |
Stockholders' Equity | |||
Preferred stock | [4] | 103,664 | 103,664 |
Common stock | [5] | 11,889,505 | 11,842,331 |
Accumulated deficit | (12,184,849) | (11,842,707) | |
TOTAL STOCKHOLDERS' EQUITY (DEFICIT) | (191,680) | 103,288 | |
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY (DEFICIT) | $ 121,273 | $ 180,301 | |
[1] | Accounts receivable, less allowance for doubtful accounts of $15,726 as of September 30, 2016 and December 31, 2015, respectively. | ||
[2] | Property and equipment, at cost less accumulated depreciation of $16,214 and $13,754 as of September 30, 2016 and December 31, 2015, respectively. | ||
[3] | Intangible assets, net of accumulated amortization of $33,953 and $30,973 as of September 30, 2016 and December 31, 2015, respectively. | ||
[4] | no par value: authorized 20 shares, issued and outstanding 10 and 0 shares, respectively. | ||
[5] | no par value; authorized 400,000,000 shares, issued and outstanding 146,008,250 and 145,363,750 as of September 30, 2016 and December 31, 2015, respectively. |
Statement of Financial Position
Statement of Financial Position - Parenthetical - $ / shares | Sep. 30, 2016 | Dec. 31, 2015 |
Statement of Financial Position | ||
Preferred Stock, Par Value | ||
Preferred Stock, Shares Authorized | 20 | 20 |
Preferred Stock, Shares Issued | 0 | 0 |
Preferred Stock, Shares Outstanding | 0 | 0 |
Common Stock, Par Value | ||
Common Stock, Shares Authorized | 400,000,000 | 400,000,000 |
Common Stock, Shares Issued | 146,008,250 | 145,363,750 |
Common Stock, Shares Outstanding | 146,008,250 | 145,363,750 |
WRAPmail, Inc. and Subsidiary 4
WRAPmail, Inc. and Subsidiary - Consolidated Statements of Operations and Comprehensive Loss - USD ($) | 3 Months Ended | 9 Months Ended | |||
Sep. 30, 2016 | Sep. 30, 2015 | Sep. 30, 2016 | Sep. 30, 2015 | ||
Income Statement | |||||
Revenues | $ 24,327 | $ 18,535 | $ 71,990 | $ 86,525 | |
Operating Expenses: | |||||
Officers and directors compensation | [1] | 38,897 | 45,751 | 159,463 | 800,751 |
Consulting fees | [2] | 4,104 | 214,827 | 98,473 | 413,435 |
Advertising expense | 5,551 | 9,999 | 10,301 | 26,852 | |
Hosting expense | 8,325 | 1,637 | 20,465 | 42,488 | |
Rent expense | 16,265 | 22,108 | 48,795 | 37,108 | |
Professional fees | 20,050 | 54,621 | 36,787 | 72,223 | |
Depreciation of property and equipment | 806 | 181 | 2,459 | 804 | |
Amortization of intangible assets | 993 | 994 | 2,980 | 2,982 | |
Other | 13,464 | 44,361 | 34,911 | 90,163 | |
TOTAL OPERATING EXPENSES | 108,455 | 394,479 | 414,634 | 1,486,806 | |
Loss from operations | (84,128) | (375,944) | (342,644) | (1,400,281) | |
Other income (expense): | |||||
Loss on Investment | (800) | (1,760) | |||
Interest income | 292 | 1 | 877 | ||
Impairment of goodwill | (1,994,641) | ||||
Interest expense | [3] | (125) | (32,307) | (375) | (32,782) |
Other income (expense) - net | 167 | (33,106) | 502 | (2,029,177) | |
Loss before provision for income taxes | (83,961) | (409,050) | (342,142) | (3,429,458) | |
Provision for income taxes | |||||
Net loss | $ (83,961) | $ (409,050) | $ (342,142) | $ (3,429,458) | |
Net loss per common share - basic and diluted | $ 0 | $ 0 | $ 0 | $ (0.02) | |
Weighted average common shares outstanding - basic and diluted | 146,012,598 | 240,509,185 | 146,009,710 | 227,708,384 | |
[1] | And payroll taxes, including stock-based compensation of $0, $750,000 and $0 and $510,000, respectively. | ||||
[2] | Including stock-based compensation of $30,000, $386,415, $0 and $204,327, respectively. | ||||
[3] | Including amortization of debt discounts of $0, $32,114, $0 and $32,114, respectively. |
WRAPmail, Inc. and Subsidiary 5
WRAPmail, Inc. and Subsidiary - Consolidated Statements of Cash Flows - USD ($) | 9 Months Ended | ||
Sep. 30, 2016 | Sep. 30, 2015 | ||
Operating Activities: | |||
Net loss | $ (342,142) | $ (3,429,458) | |
Adjustments to reconcile net loss to net cash used in operating activities: | |||
Stock-based compensation | 30,000 | 1,136,415 | |
Impairment of goodwill | 1,994,641 | ||
Loss on investment | 1,760 | ||
Depreciation of property and equipment | 2,460 | 804 | |
Amortization of intangible assets | 2,980 | 2,982 | |
Amortization of debt discount | 32,114 | ||
Changes in operating assets and liabilities: | |||
Accounts receivable, increase decrease | (2,981) | (10,569) | |
Prepaid expenses, increase decrease | 9,671 | 5,594 | |
Accounts payable, increase decrease | 66,819 | 19,110 | |
Accrued expenses payable, increase decrease | 129,362 | 9,764 | |
Net Cash Used in Operating Activities | (103,831) | (236,843) | |
Investing Activities: | |||
Cash received from acquisition | [1] | 563 | |
Intangible assets additions | 67 | ||
Investment in Company | [2] | (11,500) | |
Net Cash Used in Investing Activities | (10,870) | ||
Financing Activities: | |||
Proceeds from sales of common stock | 300,000 | ||
Repayments of notes and loans payable | (40,000) | ||
Proceeds received from notes and loans payable | 86,933 | 50,000 | |
Net Cash Provided by Financing Activities | 86,933 | 310,000 | |
Increase (decrease) in cash and cash equivalents | (16,898) | 62,287 | |
Cash and cash equivalents, beginning of period | 18,373 | 100,475 | |
Cash and cash equivalents, end of period | 1,475 | 162,762 | |
SUPPLEMENTAL CASH FLOW INFORMATION: | |||
Income taxes paid | |||
Interest paid | |||
NON-CASH INVESTING AND FINANCING ACTIVITIES: | |||
Issuance of common stock in satisfaction of debt | 47,270 | ||
Issuance of common stock for acquisition | [3] | 1,998,911 | |
Issuance of common stock in satisfaction of accrued interest | 4,375 | ||
Issuance of common stock in satisfaction of accounts payable | $ 47,174 | 82,376 | |
Issuance of common stock as additional consideration for a $50,000 loan | $ 47,872 | ||
[1] | Cash received from acquisition of Prosperity Systems, Inc. | ||
[2] | Investment in Stock Market Manager, Inc. | ||
[3] | Issuance of common stock for acquisition of Prosperity Systems, Inc. (less $563 cash received) |
Note 1 - Organization and Descr
Note 1 - Organization and Description of Business | 9 Months Ended |
Sep. 30, 2016 | |
Notes | |
Note 1 - Organization and Description of Business | NOTE 1 Organization and Description of Business WrapMail, Inc. (WRAP) was incorporated in Florida on October 11, 2005. Effective January 5, 2015 (see Note 5), we acquired 100% ownership of Prosperity Systems, Inc. (Prosperity), a New York corporation incorporated on April 2, 2008. WRAP and its wholly owned subsidiary Prosperity (collectively, the Company) provide document, project, marketing and sales management systems to business clients through its website and proprietary software. After the acquisition of Prosperity, the Company transferred Prosperitys operations to WRAP and is presently in the process of dissolving Prosperity. |
Note 2 - Going Concern Uncertai
Note 2 - Going Concern Uncertainty | 9 Months Ended |
Sep. 30, 2016 | |
Notes | |
Note 2 - Going Concern Uncertainty | NOTE 2 Going Concern Uncertainty The consolidated financial statements have been prepared on a going concern basis, which contemplates the realization of assets and liquidation of liabilities in a normal course of business. As of September 30, 2016, the Company had cash and cash equivalents of $1,475 and negative working capital of $284,024. For the nine months ended September 30, 2016 and 2015, the Company had net losses of $342,142 and $3,429,458, respectively. These factors raise substantial doubt as to the Companys ability to continue as a going concern. The Company plans to improve its financial condition by raising capital through sales of shares of its common stock. Also, the Company plans to pursue new customers to attain profitable operations. The consolidated financial statements do not include any adjustments that might be necessary should the Company be unable to continue as a going concern. |
Note 3 - Interim Financial Stat
Note 3 - Interim Financial Statements | 9 Months Ended |
Sep. 30, 2016 | |
Notes | |
Note 3 - Interim Financial Statements | NOTE 3 Interim Financial Statements The accompanying unaudited consolidated financial statements have been prepared by the Company pursuant to the rules and regulations of the Securities and Exchange Commission. Accordingly, they may not include all of the information and footnotes required by accounting principles generally accepted in the United States for complete financial statements. The interim financial statements should be read in conjunction with the Companys latest annual financial statement. In the opinion of management, the unaudited financial statements reflect all adjustments, which include only normal recurring adjustments, necessary for a fair presentation. Operating results for the nine-month period ended September 30, 2016 may not necessarily be indicative of the results that may be expected for the year ending December 31, 2016. |
Note 4 - Summary of Significant
Note 4 - Summary of Significant Accounting Policies | 9 Months Ended |
Sep. 30, 2016 | |
Notes | |
Note 4 - Summary of Significant Accounting Policies | NOTE 4 Summary of Significant Accounting Policies (a) Principles of Consolidation The consolidated financial statements include the accounts of WRAP and its wholly owned subsidiary Prosperity from the date of its acquisition on January 5, 2015. All intercompany balances and transactions have been eliminated in consolidation. (b) Use of Estimates The preparation of 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 and liabilities and disclosure of contingent assets and liabilities at the dates of the financial statements and the reported amounts of revenues and expenses during the reporting periods. Actual results could differ from those estimates. (c) Fair Value of Financial Instruments The Companys financial instruments consist of cash and cash equivalents, accounts receivable, note receivable, notes and loans payable, accounts payable, and accrued expenses payable. Except for the note receivable, the fair value of these financial instruments approximate their carrying amounts reported in the balance sheets due to the short term maturity of these instruments. Based on comparable instruments with similar terms, the fair value of the note receivable approximates its carrying value. Pursuant to ASC 820, Fair Value Measurements and Disclosures, an entity is required to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value. ASC 820 establishes a fair value hierarchy based on the level of independent, objective evidence surrounding the inputs used to measure fair value. A financial instruments categorization within the fair value hierarchy is based upon the lowest level of input that is significant to the fair value measurement. ASC 820 prioritizes the inputs into three levels that may be used to measure fair value: Level 1 Level-1 applies to assets or liabilities for which there are quoted prices in active markets for identical assets or liabilities. Level 2- Level-2 applies to assets or liabilities for which there are inputs other than quoted prices that are observable for the asset or liability such as quoted prices for similar assets or liabilities in active markets quoted prices for identical assets or liabilities in markets with insufficient volume or infrequent transactions (less active markets) or model derived valuations in which significant inputs are observable or can be derived principally from, or corroborated by, observable market data. Level 3 -Level 3 applies to assets or liabilities for which there are unobservable inputs to the Valuation methodology that are significant to the measurement of the fair value of the assets or liabilities. (d) Cash and Cash Equivalents The Company considers all liquid investments purchased with a maturity of three months or less to be cash equivalents. (e) Property and Equipment, Net Property and equipment, net, is stated at cost less accumulated depreciation. Depreciation is calculated using the straight line method over the estimated useful lives of the respective assets. Maintenance and repairs are charged to operations as incurred. (f) Intangible Assets, Net Intangible assets, net, are stated at cost less accumulated amortization. Amortization is calculated using the straight-line method over the estimated economic lives of the respective assets. (g) Goodwill and Intangible Assets with Indefinite Lives The Company does not amortize goodwill and intangible assets with indefinite useful lives, but instead tests for impairment at least annually. When conducting the annual impairment test for goodwill, the Company compares the estimated fair value of a reporting unit containing goodwill to its carrying value. If the estimated fair value of the reporting unit is determined to be less than its carrying value, goodwill is reduced and an impairment loss is recorded. (h) Long-lived Assets The Company reviews long-lived assets held and used, intangible assets with finite useful lives and assets held for sale for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. If an evaluation of recoverability is required, the estimated undiscounted future cash flows associated with the asset is compared to the assets carrying amount to determine if a write-down is required. If the undiscounted cash flows are less than the carrying amount, an impairment loss is recorded to the extent that the carrying amount exceeds the fair value. (i) Revenue Recognition The Company recognizes revenue over agreed periods of services delivered to customers, provided there are no uncertainties regarding customer acceptance, persuasive evidence of an arrangement exists; the sales price is fixed or determinable; and collectability is deemed probable. (j) Stock-Based Compensation Stock-based compensation is accounted for at fair value in accordance with Accounting Standards Codification (ASC) Topic 718, Compensation Stock Compensation (ASC718) and ASC 505-50, Equity Based Payments to Non-employees. In addition to requiring supplemental disclosures, ASC 718 addresses the accounting for share-based payment transactions in which a company receives goods or services in exchange for (a) equity instruments of the company or (b) liabilities that are based on the fair value of the companys equity instruments or that may be settled by the issuance of such equity instruments. ASC 718 focuses primarily on accounting for transactions in which a company obtains employee services in share-based payment transactions. In accordance with ASC 505-50 the Company determines the fair value of the stock based payment as either the fair value of the consideration received or the fair value of the equity instruments issued, whichever is more reliably measurable. If the fair value of the equity instruments issued is used, it is measured using the stock price and other measurement assumptions as of the earlier of either (1) the date at which a commitment for performance by the counterparty to earn the equity instrument is reached, or (2) the date at which the counterpartys performance is complete. Options and warrants The fair value of stock options and warrants is estimated on the measurement date using the Black-Scholes model with the following assumptions, which are determined at the beginning of each year and utilized in all calculations for that year: Risk-Free Interest Rate. We utilized the U.S. Treasury yield curve in effect at the time of grant with a term consistent with the expected term of our awards. Expected Volatility. We calculate the expected volatility based on a volatility index of peer companies as we did not have sufficient historical market information to estimate the volatility of our own stock. Dividend Yield. We have not declared a dividend on its common stock since its inception and have no intentions of declaring a dividend in the foreseeable future and therefore used a dividend yield of zero. Expected Term. The expected term of options granted represents the period of time that options are expected to be outstanding. We estimated the expected term of stock options by using the simplified method. For warrants, the expected term represents the actual term of the warrant. Forfeitures. Estimates of option forfeitures are based on our experience. We will adjust our estimate of forfeitures over the requisite service period based on the extent to which actual forfeitures differ, or are expected to differ, from such estimates. Changes in estimated forfeitures will be recognized through a cumulative catch-up adjustment in the period of change and will also impact the amount of compensation expense to be recognized in future periods. (k) Advertising Advertising costs are expensed as incurred and amounted to $10,301 and $26,852 for the nine months ended September 30, 2016 and 2015, respectively. (l) Research and Development Research and development costs are expensed as incurred. (m) Income Taxes Income taxes are accounted for under the assets and liability method. Current income taxes are provided in accordance with the laws of the respective taxing authorities. Deferred income taxes are provided for the estimated future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases and operating loss and tax credit carryforwards. Deferred tax assets and liabilities are measured using enacted tax rates in effect for the year in which those temporary differences are expected to be recovered or settled. Deferred tax assets are reduced by a valuation allowance when, in the opinion of management, it is not more likely than not that some portion or all of the deferred tax assets will be realized. The Company has adopted the provisions required by the Income Taxes topic of the FASB Accounting Standards Codification. The Codification Topic requires the recognition of potential liabilities as a result of managements acceptance of potentially uncertain positions for income tax treatment on a more-likely-than-not probability of an assessment upon examination by a respective taxing authority. The Company believes that it has not taken any uncertain tax positions and thus has not recorded any liability. (n) Net Income (Loss) per Common Share Basic net income (loss) per common share is computed on the basis of the weighted average number of common shares outstanding during the period. Diluted net income (loss) per common share is computed on the basis of the weighted average number of common shares and dilutive securities (such as stock options and convertible securities) outstanding. Dilutive securities having an anti-dilutive effect on diluted net income (loss) per share are excluded from the calculation. For the periods presented, the diluted net loss per share calculation excluded the effect of Series A preferred stock and stock options outstanding (see Note 9 and Note 11). (o) Recent Accounting Pronouncements Certain accounting pronouncements have been issued by the FASB and other standard setting organizations which are not yet effective and therefore have not yet been adopted by the Company. These include: In August 2014, the FASB issued ASU 2014-15 Disclosure about an Entities Ability to Continue as a Going Concern. The update establishes managements responsibility to evaluate whether there is substantial doubt about an entities ability to continue as a going concern including related disclosures. In 2016 the FASB issued ASU 2016-2(topic 842) which establishes a new lease accounting model for lessees. Under the, new guidance lessees will be required to recognize right of use assets and liabilities for most leases having terms of 12 months or more. The impact on the Companys financial statements has not yet been determined. |
Note 5 - Acquisition of Prosper
Note 5 - Acquisition of Prosperity Systems, Inc. | 9 Months Ended |
Sep. 30, 2016 | |
Notes | |
Note 5 - Acquisition of Prosperity Systems, Inc. | NOTE 5 Acquisition of Prosperity Systems, Inc. Effective January 5, 2015, WRAP acquired 100% ownership of Prosperity Systems, Inc. (Prosperity) in exchange for 36,354,077 newly issued shares of WRAP common stock (see Note 10). The acquisition has been accounted for in the accompanying consolidated financial statements as a purchase transaction. Accordingly, the financial position and results of operations of Prosperity prior to the date of the acquisition have been excluded from the accompanying consolidated financial statements. The estimated fair values of the identifiable net assets of Prosperity at January 5, 2015 (effective date of acquisition) consisted of: Cash and cash equivalents $ 563 Accounts receivable 15,436 Prepaid expenses 5,594 Property and equipment, net 1,026 Intangible assets, net 29,947 Deferred consulting fees 35,838 Total assets 88,404 Note and loan payable to related party 37,270 Convertible notes payable 30,000 Accounts payable 10,462 Accrued interest payable 5,839 Total liabilities 83,571 Identifiable net assets $ 4,833 Goodwill of $1,994,641 (excess of the $1,999,474 fair value of the 36,354,077 shares of WRAP common stock issued to Prosperity's stockholders over the $4,833 identifiable net assets of Prosperity at January 5, 2015) was considered fully impaired at the acquisition date and an impairment expense of $1,994,641 was recorded in the three months ended March 31, 2015. The following pro forma information summarizes the results of operations for the Nine Months ended September 30, 2015 as if the acquisition occurred at December 31, 2014. The pro forma information is not necessarily indicative of the results that would have been reported had the transaction actually occurred on December 31, 2014, nor is it intended to project results of operations for any future period. Nine Months Ended September 30, 2015 Revenues $ 86,525 Operating expense 1,486,806 Loss from Operations (1,400,281) Other income (loss) - net (34,536) Net loss (1,434,817) Net loss per common share basic and diluted $ (0.01) Weighted average common shares outstanding basic and diluted 227,708,384 |
Note 6 - Note Receivable
Note 6 - Note Receivable | 9 Months Ended |
Sep. 30, 2016 | |
Notes | |
Note 6 - Note Receivable | NOTE 6 Note Receivable The $39,000 note receivable at September 30, 2016 and December 31, 2015 bears interest at a rate of 3% per annum and is due November 30, 2020. The receivable arose from the Companys sale of its 50% interest in Stock Market Manager, Inc. to Endeavour Cooperative Partners, LLC (Endeavour) on November 30, 2015. Endeavour is affiliated with Carl Dilley, a Company director. |
Note 7 - Intangible Assets, Net
Note 7 - Intangible Assets, Net | 9 Months Ended |
Sep. 30, 2016 | |
Notes | |
Note 7 - Intangible Assets, Net | NOTE 7 Intangible Assets, Net Intangible assets, net, consist of: September 30, 2016 December 31, 2015 Video conferencing software acquired by Prosperity in December 2009 $ 30,000 $ 30,000 Enterprise and audit software acquired by Prosperity in April 2008 20,000 20,000 Patent costs incurred by WRAP 6,880 6,880 Other 3,548 3,548 Total 60,428 60,428 Accumulated amortization (33,953) (30,973) Net $ 26,475 $ 29,455 Expected future amortization expense for intangible assets as of September 30, 2016 follows: Amount 2016 $ 995 2017 3,975 2018 3,975 2019 3,975 Thereafter 13,555 Total $ 26,475 |
Note 8 - Notes and Loans Payabl
Note 8 - Notes and Loans Payable | 9 Months Ended |
Sep. 30, 2016 | |
Notes | |
Note 8 - Notes and Loans Payable | NOTE 8 Notes and Loans Payable Notes and loans payable consist of: September 30, 2016 December 31, 2015 Notes payable dated February 1, 2016, interest at 12% per $ 30,000 $ - annum, due April 1, 2016 Notes payable dated March 15, 2016, interest at 14.99% per 51,250 - annum, due March 24, 2017 Convertible note payable to brother of Marco Alfonsi, Chief 5,000 5,000 Executive Officer of the Company, interest at 10% per annum, due August 22, 2016 Loan payable to Mckenzie Webster Limited (MWL), an 3,000 3,000 entity controlled by the Chairman of the Board of Directors of the Company, non-interest bearing, due on demand 2,240 Loan payable to Marco Alfonsi, Chief Executive Officer of the Company, non-interest bearing, due on demand 3,443 - Total $ 94,933 $ 8,000 The notes payable dated February 1, 2016 totaling $30,000 consist of two $15,000 notes. One of the $15,000 notes is due to the brother of the Chief Executive Officer of the Company. |
Note 9 - Preferred Stock
Note 9 - Preferred Stock | 9 Months Ended |
Sep. 30, 2016 | |
Notes | |
Note 9 - Preferred Stock | NOTE 9 Preferred Stock On October 29, 2015, the Company issued a total of 10 shares of WRAP Series A Preferred Stock (5 shares to MWL and 5 shares to Marco Alfonsi) in exchange for the retirement of a total of 100,000,000 shares of WRAP common stock (50,000,000 shares from MWL and 50,000,000 shares from Marco Alfonsi). Each share of Series A Preferred Stock is convertible into 10,000,000 shares of WRAP common stock and is entitled to 20,000,000 votes. |
Note 10 - Common Stock
Note 10 - Common Stock | 9 Months Ended |
Sep. 30, 2016 | |
Notes | |
Note 10 - Common Stock | NOTE 10 Common Stock On January 5, 2015, the Company issued a total of 36,354,077 shares of WRAP common stock to Prosperity stockholders pursuant to the acquisition of Prosperity. See Note 5. On January 5, 2015, the Company issued 70,166,750 shares of WRAP common stock to Marco Alfonsi in satisfaction of $22,270 Prosperity loans payable to Marco Alfonsi. On January 5, 2015, MWL retired 70,166,750 shares of WRAP common stock owned by it. On March 19, 2015, the Company issued 117,500 shares of WRAP common stock to an investor in satisfaction of a $25,000 Prosperity note payable and $4,375 accrued interest. On March 26, 2015, the Company issued a total of 5,000,000 shares of WRAP common stock to the three members of the Board of Directors (1,000,000 shares each) and the four members of the Board of Advisors (500,000 shares each) for services rendered. The $400,000 fair value of the 5,000,000 shares of WRAP common stock was charged $240,000 to officers and directors compensation and $160,000 to consulting fees in the three months ended March 31, 2015. On June 14, 2015 (see Note 13), the Company issued 10,000,000 shares of WRAP common stock to Marco Alfonsi pursuant to an Executive Employment Agreement dated May 14, 2015. The $510,000 fair value of the 10,000,000 shares of WRAP common stock was charged to officers and directors compensation in the three months ended June 30, 2015. On June 30, 2015, the Company issued 1,600,000 shares of WRAP common stock to a vendor in satisfaction of a $82,376 account payable to the vendor. On July 6, 2015, the Company issued a total of 1,200,000 shares of WRAP common stock to two consultants for services rendered. The $60,000 fair value of the 1,200,000 shares of WRAP common stock was charged to consulting fees in the three months ended September 30, 2015. On July 31, 2015, the Company issued 50,000 shares of WRAP common stock to a consultant for services rendered. The $14,995 fair value of the 50,000 shares of WRAP common stock was charged to consulting fees in the three months ended September 30, 2015. On August 4, 2015, the Company sold 1,000,000 shares of WRAP common stock to an investor at a price of $0.10 per share for proceeds of $100,000. On August 14, 2015, the Company issued 430,000 shares of WRAP common stock to a consultant for services rendered. The $107,457 fair value of the 430,000 shares of WRAP common stock was charged to consulting fees in the three months ended September 30, 2015. On August 18, 2015, the Company sold 1,000,000 shares of WRAP common stock to a non-U.S. individual investor at a price of $0.10 per share for proceeds of $100,000. On August 19, 2015, the Company sold 1,000,000 shares of WRAP common stock to a non-U.S. entity investor at a price of $0.10 per share for proceeds of $100,000. On August 21, 2015, the Company issued 400,000 shares of WRAP common stock to a consultant for services rendered. $60,000 of the $90,000 fair value of the 400,000 shares of WRAP common stock was charged to consulting fees in the six months ended December 31, 2015 and $30,000 was charged to consulting fees in the three months ended March 31, 2016. On August 21, 2015, pursuant to a $50,000 Bridge Loan Financing Agreement and related Note dated August 20, 2015, the Company issued 5,000,000 shares of WRAP common stock to an investor as additional consideration for a $50,000 loan. The proceeds of the Note were allocated between the principal and the $1,125,000 fair value of the 5,000,000 shares of WRAP common stock resulting in the Company recording a discount on the debt of $47,872. This amount was amortized over the term of the Note. On December 30, 2015, the Company issued 150,000 shares of WRAP common stock to an entity for accounting services rendered. The $15,000 fair value of the 150,000 shares of WRAP common stock was charged to other operating expenses in the three months ended December 31, 2015. On January 2, 2016, the Company issued 104,500 shares of WRAP common stock to a technical consultant in satisfaction of a $12,864 account payable to that vendor. On March 9, 2016, the Company issued 140,000 shares of WRAP common stock to a technical consultant in satisfaction of a $8,693 account payable to that vendor. On September 30, 2016, the Company issued 400,000 shares of WRAP common stock to a technical consultant in satisfaction of a $25,617 account payable to that vendor. |
Note 11 - Stock Options and War
Note 11 - Stock Options and Warrants | 9 Months Ended |
Sep. 30, 2016 | |
Notes | |
Note 11 - Stock Options and Warrants | NOTE 11 Stock Options and Warrants A summary of stock options and warrants activity follows: Shares of Common Stock Exercisable Into Stock Options Warrants Total Balance, December 31, 2014 200,000 307,500 507,500 Granted in 2015 - - - Cancelled in 2015 - - - Balance, December 31, 2015 200,000 307,500 507,500 Granted in 1Q and 2Q 2016 - - - Cancelled in 1Q and 2Q 2016 - - - Balance, September 30, 2016 200,000 307,500 507,500 Issued and outstanding stock options as of September 30, 2016 consist of: Year Number Outstanding Exercise Year of Granted and Exercisable Price Expiration 2006 150,000 $ 1.00 2016 2009 50,000 $ 1.00 2019 Total 200,000 Issued and outstanding warrants as of September 30, 2016 consist of: Year Number Outstanding Exercise Year of Granted and Exercisable Price Expiration 2006 60,000 $ 1.00 2016 2010 247,500 $ 1.00 2020 Total 307,500 |
Note 12 - Income Taxes
Note 12 - Income Taxes | 9 Months Ended |
Sep. 30, 2016 | |
Notes | |
Note 12 - Income Taxes | NOTE 12 Income Taxes No provisions for income taxes were recorded for the periods presented since the Company incurred net losses in those periods. The provisions for (benefits from) income taxes differ from the amounts determined by applying the U.S. Federal income tax rate of 35% to pretax income (loss) as follows: Nine Months Ended September 30, 2016 2015 Expected income tax (benefit) at 35% $ (119,750) $ (1,200,311) Non-deductible stock-based compensation 10,500 397,745 Non-deductible impairment of goodwill - 698,124 Increase in deferred income tax assets valuation allowance 109,250 104,442 Provision for (benefit from) income taxes $ - $ - Deferred income tax assets consist of: September 30, 2016 December 31, 2015 Net operating loss carryforward $ 1,194,524 $ 1,085,274 Valuation allowance (1,194,524) (1,085,274) Net $ - $ - Based on management's present assessment, the Company has not yet determined it to be more likely than not that a deferred income tax asset of $1,194,524 attributable to the future utilization of the $3,412,925 net operating loss carryforward as of September 30, 2016 will be realized. Accordingly, the Company has maintained a 100% allowance against the deferred income tax asset in the financial statements at September 30, 2016. The Company will continue to review this valuation allowance and make adjustments as appropriate. The net operating loss carryforward expires in years 2025, 2026, 2027, 2028, 2029, 2030, 2031, 2032, 2033, 2034, 2035, and 2036 in the amount of $1,369, $518,390, $594,905, $686,775, $159,141, $151,874, $135,096, $166,911, $311,890, $28,511, $345,921, and $312,142, respectively. Current tax laws limit the amount of loss available to be offset against future taxable income when a substantial change in ownership occurs. Therefore, the amount available to offset future taxable income may be limited. The Company's U.S. Federal and state income tax returns prior to 2012 are closed and management continually evaluates expiring statutes of limitations, audits, proposed settlements, changes in tax law and new authoritative rulings. The statute of limitations on the 2012 tax year returns expired in March 2016. The Company recognizes interest and penalties associated with uncertain tax positions as part of the income tax provision and would include accrued interest and penalties with the related tax liability in the consolidated balance sheets. There were no interest or penalties paid during 2016 and 2015. |
Note 13 - Commitments and Conti
Note 13 - Commitments and Contingencies | 9 Months Ended |
Sep. 30, 2016 | |
Notes | |
Note 13 - Commitments and Contingencies | NOTE 13 Commitments and Contingencies Employment Agreements On May 14, 2015, the Company executed an Executive Employment Agreement with Marco Alfonsi (Alfonsi) for Alfonsi to serve as the Company's chief executive officer for cash compensation of $5,000 per month (increased to $6,000 per month in August 2015). Pursuant to the agreement, the Company issued 10,000,000 restricted shares of WRAP common stock to Alfonsi on June 14, 2015 (see Note 10). Alfonsi may terminate his employment upon 30 days written notice to the Company. The Company may terminate Alfonsi's employment upon written notice to Alfonsi by a vote of the Board of Directors. On August 17, 2015, the Company executed an Employment Agreement with Romuald Stone (Stone) for Stone to serve as the Company's Chief Technology Officer for cash compensation of $12,500 per month. Stone may terminate his employment upon 30 days written notice to the Company. The Company may terminate Stone's employment upon written notice to Stone by a vote of the Board of Directors. If the Company's termination is without cause (as defined), Stone will be entitled to a severance payment of $12,500. Lease Agreements On December 1, 2014, Prosperity entered into a lease agreement with KLAM, Inc. for office space in Hicksville, New York for an initial term of one year commencing December 1, 2014. The lease provides for monthly rentals of $2,500 and provides Prosperity an option to renew the lease after the initial term. The Company has continued to occupy this space after November 30, 2015 under a month to month arrangement at $2,500 per month. KLAM, Inc. is controlled by the wife of the Company's chief executive officer Marco Alfonsi. On September 11, 2015, the Company executed a lease agreement with an unrelated third party for office space in Hicksville, New York for a term of 37 months. The lease provides for monthly rentals of $2,922 for lease year 1, $3,009 for lease year 2, and $3,100 for lease year 3. The lease also provides for additional rent based on increases in base year operating expenses and real estate taxes. Rent expense for the nine months ended September 30, 2016 and 2015 was $48,795 and $37,108, respectively. At September 30, 2016, the future minimum lease payments under non-cancellable operating leases were: Year ended December 31, 2016 $ 9,118 Year ended December 31, 2017 36,472 Year ended December 31, 2018 27,900 Total $ 73,490 Major Customers For the nine months ended September 30, 2016, three customers accounted for approximately 36%, 29%, and 15%, respectively, of total revenues. For the nine months ended September 30, 2015, three customers accounted for approximately 30%, 24%, and 14%, respectively, of total revenues. Public Offering of Units On August 2, 2016, the Companys Registration Statement on Form S-1 was declared effective by the Securities and Exchange Commission. On a self-underwritten basis, the Company is offering up to 40,000,000 Units at a price of $0.05 per Unit or $2,000,000 maximum. Each Unit consists of one share of Company common stock and one warrant to purchase ½ share of Company common stock of a price of $0.10 per share for a period of three years. There is no minimum offering amount or escrow required as a condition to closing and the Company may sell significantly fewer Units than those offered. The offering will terminate on August 2, 2018 unless earlier terminated or extended by the Companys filing of an amendment to the Registration Statement. |
Note 4 - Summary of Significa19
Note 4 - Summary of Significant Accounting Policies: (a) Principles of Consolidation (Policies) | 9 Months Ended |
Sep. 30, 2016 | |
Policies | |
(a) Principles of Consolidation | (a) Principles of Consolidation The consolidated financial statements include the accounts of WRAP and its wholly owned subsidiary Prosperity from the date of its acquisition on January 5, 2015. All intercompany balances and transactions have been eliminated in consolidation. |
Note 4 - Summary of Significa20
Note 4 - Summary of Significant Accounting Policies: (b) Use of Estimates (Policies) | 9 Months Ended |
Sep. 30, 2016 | |
Policies | |
(b) Use of Estimates | (b) Use of Estimates The preparation of 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 and liabilities and disclosure of contingent assets and liabilities at the dates of the financial statements and the reported amounts of revenues and expenses during the reporting periods. Actual results could differ from those estimates. |
Note 4 - Summary of Significa21
Note 4 - Summary of Significant Accounting Policies: (c) Fair Value of Financial Instruments (Policies) | 9 Months Ended |
Sep. 30, 2016 | |
Policies | |
(c) Fair Value of Financial Instruments | (c) Fair Value of Financial Instruments The Companys financial instruments consist of cash and cash equivalents, accounts receivable, note receivable, notes and loans payable, accounts payable, and accrued expenses payable. Except for the note receivable, the fair value of these financial instruments approximate their carrying amounts reported in the balance sheets due to the short term maturity of these instruments. Based on comparable instruments with similar terms, the fair value of the note receivable approximates its carrying value. Pursuant to ASC 820, Fair Value Measurements and Disclosures, an entity is required to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value. ASC 820 establishes a fair value hierarchy based on the level of independent, objective evidence surrounding the inputs used to measure fair value. A financial instruments categorization within the fair value hierarchy is based upon the lowest level of input that is significant to the fair value measurement. ASC 820 prioritizes the inputs into three levels that may be used to measure fair value: Level 1 Level-1 applies to assets or liabilities for which there are quoted prices in active markets for identical assets or liabilities. Level 2- Level-2 applies to assets or liabilities for which there are inputs other than quoted prices that are observable for the asset or liability such as quoted prices for similar assets or liabilities in active markets quoted prices for identical assets or liabilities in markets with insufficient volume or infrequent transactions (less active markets) or model derived valuations in which significant inputs are observable or can be derived principally from, or corroborated by, observable market data. Level 3 -Level 3 applies to assets or liabilities for which there are unobservable inputs to the Valuation methodology that are significant to the measurement of the fair value of the assets or liabilities. |
Note 4 - Summary of Significa22
Note 4 - Summary of Significant Accounting Policies: (d) Cash and Cash Equivalents (Policies) | 9 Months Ended |
Sep. 30, 2016 | |
Policies | |
(d) Cash and Cash Equivalents | (d) Cash and Cash Equivalents The Company considers all liquid investments purchased with a maturity of three months or less to be cash equivalents. |
Note 4 - Summary of Significa23
Note 4 - Summary of Significant Accounting Policies: (e) Property and Equipment, Net (Policies) | 9 Months Ended |
Sep. 30, 2016 | |
Policies | |
(e) Property and Equipment, Net | (e) Property and Equipment, Net Property and equipment, net, is stated at cost less accumulated depreciation. Depreciation is calculated using the straight line method over the estimated useful lives of the respective assets. Maintenance and repairs are charged to operations as incurred. |
Note 4 - Summary of Significa24
Note 4 - Summary of Significant Accounting Policies: (f) Intangible Assets, Net (Policies) | 9 Months Ended |
Sep. 30, 2016 | |
Policies | |
(f) Intangible Assets, Net | (f) Intangible Assets, Net Intangible assets, net, are stated at cost less accumulated amortization. Amortization is calculated using the straight-line method over the estimated economic lives of the respective assets. |
Note 4 - Summary of Significa25
Note 4 - Summary of Significant Accounting Policies: (g) Goodwill and Intangible Assets With Indefinite Lives (Policies) | 9 Months Ended |
Sep. 30, 2016 | |
Policies | |
(g) Goodwill and Intangible Assets With Indefinite Lives | (g) Goodwill and Intangible Assets with Indefinite Lives The Company does not amortize goodwill and intangible assets with indefinite useful lives, but instead tests for impairment at least annually. When conducting the annual impairment test for goodwill, the Company compares the estimated fair value of a reporting unit containing goodwill to its carrying value. If the estimated fair value of the reporting unit is determined to be less than its carrying value, goodwill is reduced and an impairment loss is recorded. |
Note 4 - Summary of Significa26
Note 4 - Summary of Significant Accounting Policies: (h) Long-lived Assets (Policies) | 9 Months Ended |
Sep. 30, 2016 | |
Policies | |
(h) Long-lived Assets | (h) Long-lived Assets The Company reviews long-lived assets held and used, intangible assets with finite useful lives and assets held for sale for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. If an evaluation of recoverability is required, the estimated undiscounted future cash flows associated with the asset is compared to the assets carrying amount to determine if a write-down is required. If the undiscounted cash flows are less than the carrying amount, an impairment loss is recorded to the extent that the carrying amount exceeds the fair value. |
Note 4 - Summary of Significa27
Note 4 - Summary of Significant Accounting Policies: (i) Revenue Recognition (Policies) | 9 Months Ended |
Sep. 30, 2016 | |
Policies | |
(i) Revenue Recognition | (i) Revenue Recognition The Company recognizes revenue over agreed periods of services delivered to customers, provided there are no uncertainties regarding customer acceptance, persuasive evidence of an arrangement exists; the sales price is fixed or determinable; and collectability is deemed probable. |
Note 4 - Summary of Significa28
Note 4 - Summary of Significant Accounting Policies: (j) Stock-based Compensation (Policies) | 9 Months Ended |
Sep. 30, 2016 | |
Policies | |
(j) Stock-based Compensation | (j) Stock-Based Compensation Stock-based compensation is accounted for at fair value in accordance with Accounting Standards Codification (ASC) Topic 718, Compensation Stock Compensation (ASC718) and ASC 505-50, Equity Based Payments to Non-employees. In addition to requiring supplemental disclosures, ASC 718 addresses the accounting for share-based payment transactions in which a company receives goods or services in exchange for (a) equity instruments of the company or (b) liabilities that are based on the fair value of the companys equity instruments or that may be settled by the issuance of such equity instruments. ASC 718 focuses primarily on accounting for transactions in which a company obtains employee services in share-based payment transactions. In accordance with ASC 505-50 the Company determines the fair value of the stock based payment as either the fair value of the consideration received or the fair value of the equity instruments issued, whichever is more reliably measurable. If the fair value of the equity instruments issued is used, it is measured using the stock price and other measurement assumptions as of the earlier of either (1) the date at which a commitment for performance by the counterparty to earn the equity instrument is reached, or (2) the date at which the counterpartys performance is complete. Options and warrants The fair value of stock options and warrants is estimated on the measurement date using the Black-Scholes model with the following assumptions, which are determined at the beginning of each year and utilized in all calculations for that year: Risk-Free Interest Rate. We utilized the U.S. Treasury yield curve in effect at the time of grant with a term consistent with the expected term of our awards. Expected Volatility. We calculate the expected volatility based on a volatility index of peer companies as we did not have sufficient historical market information to estimate the volatility of our own stock. Dividend Yield. We have not declared a dividend on its common stock since its inception and have no intentions of declaring a dividend in the foreseeable future and therefore used a dividend yield of zero. Expected Term. The expected term of options granted represents the period of time that options are expected to be outstanding. We estimated the expected term of stock options by using the simplified method. For warrants, the expected term represents the actual term of the warrant. Forfeitures. Estimates of option forfeitures are based on our experience. We will adjust our estimate of forfeitures over the requisite service period based on the extent to which actual forfeitures differ, or are expected to differ, from such estimates. Changes in estimated forfeitures will be recognized through a cumulative catch-up adjustment in the period of change and will also impact the amount of compensation expense to be recognized in future periods. |
Note 4 - Summary of Significa29
Note 4 - Summary of Significant Accounting Policies: (k) Advertising (Policies) | 9 Months Ended |
Sep. 30, 2016 | |
Policies | |
(k) Advertising | (k) Advertising Advertising costs are expensed as incurred and amounted to $10,301 and $26,852 for the nine months ended September 30, 2016 and 2015, respectively. |
Note 4 - Summary of Significa30
Note 4 - Summary of Significant Accounting Policies: (l) Research and Development (Policies) | 9 Months Ended |
Sep. 30, 2016 | |
Policies | |
(l) Research and Development | (l) Research and Development Research and development costs are expensed as incurred. |
Note 4 - Summary of Significa31
Note 4 - Summary of Significant Accounting Policies: (m) Income Taxes (Policies) | 9 Months Ended |
Sep. 30, 2016 | |
Policies | |
(m) Income Taxes | (m) Income Taxes Income taxes are accounted for under the assets and liability method. Current income taxes are provided in accordance with the laws of the respective taxing authorities. Deferred income taxes are provided for the estimated future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases and operating loss and tax credit carryforwards. Deferred tax assets and liabilities are measured using enacted tax rates in effect for the year in which those temporary differences are expected to be recovered or settled. Deferred tax assets are reduced by a valuation allowance when, in the opinion of management, it is not more likely than not that some portion or all of the deferred tax assets will be realized. The Company has adopted the provisions required by the Income Taxes topic of the FASB Accounting Standards Codification. The Codification Topic requires the recognition of potential liabilities as a result of managements acceptance of potentially uncertain positions for income tax treatment on a more-likely-than-not probability of an assessment upon examination by a respective taxing authority. The Company believes that it has not taken any uncertain tax positions and thus has not recorded any liability. |
Note 4 - Summary of Significa32
Note 4 - Summary of Significant Accounting Policies: (n) Net Income (loss) Per Common Share (Policies) | 9 Months Ended |
Sep. 30, 2016 | |
Policies | |
(n) Net Income (loss) Per Common Share | (n) Net Income (Loss) per Common Share Basic net income (loss) per common share is computed on the basis of the weighted average number of common shares outstanding during the period. Diluted net income (loss) per common share is computed on the basis of the weighted average number of common shares and dilutive securities (such as stock options and convertible securities) outstanding. Dilutive securities having an anti-dilutive effect on diluted net income (loss) per share are excluded from the calculation. For the periods presented, the diluted net loss per share calculation excluded the effect of Series A preferred stock and stock options outstanding (see Note 9 and Note 11). |
Note 4 - Summary of Significa33
Note 4 - Summary of Significant Accounting Policies: (o) Recent Accounting Pronouncements (Policies) | 9 Months Ended |
Sep. 30, 2016 | |
Policies | |
(o) Recent Accounting Pronouncements | (o) Recent Accounting Pronouncements Certain accounting pronouncements have been issued by the FASB and other standard setting organizations which are not yet effective and therefore have not yet been adopted by the Company. These include: In August 2014, the FASB issued ASU 2014-15 Disclosure about an Entities Ability to Continue as a Going Concern. The update establishes managements responsibility to evaluate whether there is substantial doubt about an entities ability to continue as a going concern including related disclosures. In 2016 the FASB issued ASU 2016-2(topic 842) which establishes a new lease accounting model for lessees. Under the, new guidance lessees will be required to recognize right of use assets and liabilities for most leases having terms of 12 months or more. The impact on the Companys financial statements has not yet been determined. |
Note 5 - Acquisition of Prosp34
Note 5 - Acquisition of Prosperity Systems, Inc.: Schedule of Business Acquisitions, by Acquisition (Tables) | 9 Months Ended |
Sep. 30, 2016 | |
Tables/Schedules | |
Schedule of Business Acquisitions, by Acquisition | Cash and cash equivalents $ 563 Accounts receivable 15,436 Prepaid expenses 5,594 Property and equipment, net 1,026 Intangible assets, net 29,947 Deferred consulting fees 35,838 Total assets 88,404 Note and loan payable to related party 37,270 Convertible notes payable 30,000 Accounts payable 10,462 Accrued interest payable 5,839 Total liabilities 83,571 Identifiable net assets $ 4,833 |
Note 5 - Acquisition of Prosp35
Note 5 - Acquisition of Prosperity Systems, Inc.: Schedule of Product Information (Tables) | 9 Months Ended |
Sep. 30, 2016 | |
Tables/Schedules | |
Schedule of Product Information | Nine Months Ended September 30, 2015 Revenues $ 86,525 Operating expense 1,486,806 Loss from Operations (1,400,281) Other income (loss) - net (34,536) Net loss (1,434,817) Net loss per common share basic and diluted $ (0.01) Weighted average common shares outstanding basic and diluted 227,708,384 |
Note 7 - Intangible Assets, N36
Note 7 - Intangible Assets, Net: Schedule of Intangible Assets and Goodwill (Tables) | 9 Months Ended |
Sep. 30, 2016 | |
Tables/Schedules | |
Schedule of Intangible Assets and Goodwill | September 30, 2016 December 31, 2015 Video conferencing software acquired by Prosperity in December 2009 $ 30,000 $ 30,000 Enterprise and audit software acquired by Prosperity in April 2008 20,000 20,000 Patent costs incurred by WRAP 6,880 6,880 Other 3,548 3,548 Total 60,428 60,428 Accumulated amortization (33,953) (30,973) Net $ 26,475 $ 29,455 |
Note 7 - Intangible Assets, N37
Note 7 - Intangible Assets, Net: Schedule of Expected Amortization Text Block (Tables) | 9 Months Ended |
Sep. 30, 2016 | |
Tables/Schedules | |
Schedule of Expected Amortization Text Block | Amount 2016 $ 995 2017 3,975 2018 3,975 2019 3,975 Thereafter 13,555 Total $ 26,475 |
Note 8 - Notes and Loans Paya38
Note 8 - Notes and Loans Payable: Schedule of Notes and Loans Payable Text Block (Tables) | 9 Months Ended |
Sep. 30, 2016 | |
Tables/Schedules | |
Schedule of Notes and Loans Payable Text Block | Notes and loans payable consist of: September 30, 2016 December 31, 2015 Notes payable dated February 1, 2016, interest at 12% per $ 30,000 $ - annum, due April 1, 2016 Notes payable dated March 15, 2016, interest at 14.99% per 51,250 - annum, due March 24, 2017 Convertible note payable to brother of Marco Alfonsi, Chief 5,000 5,000 Executive Officer of the Company, interest at 10% per annum, due August 22, 2016 Loan payable to Mckenzie Webster Limited (MWL), an 3,000 3,000 entity controlled by the Chairman of the Board of Directors of the Company, non-interest bearing, due on demand 2,240 Loan payable to Marco Alfonsi, Chief Executive Officer of the Company, non-interest bearing, due on demand 3,443 - Total $ 94,933 $ 8,000 |
Note 11 - Stock Options and W39
Note 11 - Stock Options and Warrants: Schedule of Stockholders' Equity Note, Warrants or Rights (Tables) | 9 Months Ended |
Sep. 30, 2016 | |
Tables/Schedules | |
Schedule of Stockholders' Equity Note, Warrants or Rights | Shares of Common Stock Exercisable Into Stock Options Warrants Total Balance, December 31, 2014 200,000 307,500 507,500 Granted in 2015 - - - Cancelled in 2015 - - - Balance, December 31, 2015 200,000 307,500 507,500 Granted in 1Q and 2Q 2016 - - - Cancelled in 1Q and 2Q 2016 - - - Balance, September 30, 2016 200,000 307,500 507,500 |
Note 11 - Stock Options and W40
Note 11 - Stock Options and Warrants: Schedule of Issued and Outstanding Stock Options Text Block (Tables) | 9 Months Ended |
Sep. 30, 2016 | |
Tables/Schedules | |
Schedule of Issued and Outstanding Stock Options Text Block | Year Number Outstanding Exercise Year of Granted and Exercisable Price Expiration 2006 150,000 $ 1.00 2016 2009 50,000 $ 1.00 2019 Total 200,000 |
Note 11 - Stock Options and W41
Note 11 - Stock Options and Warrants: Schedule of Issued and Outstanding Warrants Text Block (Tables) | 9 Months Ended |
Sep. 30, 2016 | |
Tables/Schedules | |
Schedule of Issued and Outstanding Warrants Text Block | Year Number Outstanding Exercise Year of Granted and Exercisable Price Expiration 2006 60,000 $ 1.00 2016 2010 247,500 $ 1.00 2020 Total 307,500 |
Note 12 - Income Taxes_ Schedul
Note 12 - Income Taxes: Schedule of Share-based Compensation, Activity (Tables) | 9 Months Ended |
Sep. 30, 2016 | |
Tables/Schedules | |
Schedule of Share-based Compensation, Activity | Nine Months Ended September 30, 2016 2015 Expected income tax (benefit) at 35% $ (119,750) $ (1,200,311) Non-deductible stock-based compensation 10,500 397,745 Non-deductible impairment of goodwill - 698,124 Increase in deferred income tax assets valuation allowance 109,250 104,442 Provision for (benefit from) income taxes $ - $ - |
Note 12 - Income Taxes_ Sched43
Note 12 - Income Taxes: Schedule of Deferred Tax Assets and Liabilities (Tables) | 9 Months Ended |
Sep. 30, 2016 | |
Tables/Schedules | |
Schedule of Deferred Tax Assets and Liabilities | September 30, 2016 December 31, 2015 Net operating loss carryforward $ 1,194,524 $ 1,085,274 Valuation allowance (1,194,524) (1,085,274) Net $ - $ - |
Note 13 - Commitments and Con44
Note 13 - Commitments and Contingencies: Schedule of Rent Expense (Tables) | 9 Months Ended |
Sep. 30, 2016 | |
Tables/Schedules | |
Schedule of Rent Expense | Year ended December 31, 2016 $ 9,118 Year ended December 31, 2017 36,472 Year ended December 31, 2018 27,900 Total $ 73,490 |
Note 2 - Going Concern Uncert45
Note 2 - Going Concern Uncertainty (Details) - USD ($) | 3 Months Ended | 9 Months Ended | |||
Sep. 30, 2016 | Sep. 30, 2015 | Sep. 30, 2016 | Sep. 30, 2015 | Jan. 05, 2015 | |
Details | |||||
Cash Equivalents, at Carrying Value | $ 1,475 | $ 1,475 | $ 563 | ||
Working Capital | 284,024 | 284,024 | |||
Net loss | $ 83,961 | $ 409,050 | $ 342,142 | $ 3,429,458 |
Note 4 - Summary of Significa46
Note 4 - Summary of Significant Accounting Policies: (k) Advertising (Details) - USD ($) | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2016 | Sep. 30, 2015 | Sep. 30, 2016 | Sep. 30, 2015 | |
Details | ||||
Advertising expense | $ 5,551 | $ 9,999 | $ 10,301 | $ 26,852 |
Note 5 - Acquisition of Prosp47
Note 5 - Acquisition of Prosperity Systems, Inc.: Schedule of Business Acquisitions, by Acquisition (Details) - USD ($) | Sep. 30, 2016 | Dec. 31, 2015 | Jan. 05, 2015 |
Details | |||
Cash Equivalents, at Carrying Value | $ 1,475 | $ 563 | |
Accounts Receivable, Net | 15,436 | ||
Prepaid Expense, Current | 5,594 | ||
Property, Plant and Equipment, Net | 1,026 | ||
Other Intangible Assets, Net | 29,947 | ||
Deferred Consulting Fees | 35,838 | ||
TOTAL CURRENT ASSETS | 28,929 | $ 82,517 | 88,404 |
Notes Payable, Related Parties | 37,270 | ||
Convertible Debt, Current | 30,000 | ||
Accounts Payable, Current | 10,462 | ||
Accounts Payable and Accrued Liabilities, Current | 5,839 | ||
Total current liabilities and total liabilities | $ 312,953 | $ 77,013 | 83,571 |
Identifiable Net Assets | $ 4,833 |
Note 5 - Acquisition of Prosp48
Note 5 - Acquisition of Prosperity Systems, Inc. (Details) | 9 Months Ended |
Sep. 30, 2016USD ($) | |
Details | |
Impairment of goodwill | $ 1,994,641 |
Note 5 - Acquisition of Prosp49
Note 5 - Acquisition of Prosperity Systems, Inc.: Schedule of Product Information (Details) - USD ($) | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2016 | Sep. 30, 2015 | Sep. 30, 2016 | Sep. 30, 2015 | |
Details | ||||
Revenues | $ 24,327 | $ 18,535 | $ 71,990 | $ 86,525 |
TOTAL OPERATING EXPENSES | 108,455 | 394,479 | 414,634 | 1,486,806 |
Loss from operations | $ (84,128) | $ (375,944) | $ (342,644) | (1,400,281) |
Other Nonoperating Income | (34,536) | |||
Net Income (Loss), Including Portion Attributable to Noncontrolling Interest | $ (1,434,817) | |||
Earnings Per Share, Basic | $ (0.01) | |||
Weighted average common shares outstanding - basic and diluted | 146,012,598 | 240,509,185 | 146,009,710 | 227,708,384 |
Note 6 - Note Receivable (Detai
Note 6 - Note Receivable (Details) - USD ($) | Sep. 30, 2016 | Dec. 31, 2015 |
Note receivable | $ 39,000 | $ 39,000 |
Endeavour Cooperative Partners, LLC | ||
Note receivable | $ 39,000 | |
Accounts Payable, Interest-bearing, Interest Rate | 3.00% |
Note 7 - Intangible Assets, N51
Note 7 - Intangible Assets, Net: Schedule of Intangible Assets and Goodwill (Details) - USD ($) | Sep. 30, 2016 | Dec. 31, 2015 |
Finite-Lived Patents, Gross | $ 6,880 | $ 6,880 |
Other Finite-Lived Intangible Assets, Gross | 3,548 | 3,548 |
Total Intangible Assets net | 60,428 | 60,428 |
Accumulated Amortization of Intangible Assets | (33,953) | (30,973) |
Intangible Assets net | 26,475 | 29,455 |
Video Conferencing Software | ||
Capitalized Computer Software, Gross | 30,000 | 30,000 |
Enterprise and Audit Software | ||
Capitalized Computer Software, Gross | $ 20,000 | $ 20,000 |
Note 7 - Intangible Assets, N52
Note 7 - Intangible Assets, Net: Schedule of Expected Amortization Text Block (Details) | Sep. 30, 2016USD ($) |
2,016 | |
Expected Future Amortization Expense | $ 995 |
2,017 | |
Expected Future Amortization Expense | 3,975 |
2,018 | |
Expected Future Amortization Expense | 3,975 |
2,019 | |
Expected Future Amortization Expense | 3,975 |
Thereafter | |
Expected Future Amortization Expense | 13,555 |
Total | |
Expected Future Amortization Expense | $ 26,475 |
Note 8 - Notes and Loans Paya53
Note 8 - Notes and Loans Payable: Schedule of Notes and Loans Payable Text Block (Details) - USD ($) | Sep. 30, 2016 | Dec. 31, 2015 |
Notes payable dated February 1, 2016, interest at 12% per annum, due April 1, 2016 | ||
Notes Payable | $ 30,000 | |
Notes payable dated March 15, 2016, interest at 14.99% per annum, due March 24, 2017 | ||
Notes Payable | 51,250 | |
Convertible note payable to brother of Marco Alfonsi, Chief Executive Officer of the Company, interest at 10% per annum, due August 22, 2016 | ||
Notes Payable | 5,000 | $ 5,000 |
Loan payable to Mckenzie Webster Limited ("MWL"), an entity controlled by the Chairman of the Board of Directors of the Company, non-interest bearing, due on demand | ||
Notes Payable | 3,000 | 3,000 |
Directors of the Company | ||
Notes Payable | 2,240 | |
Loan payable to Marco Alfonsi, Chief Executive Officer of the Company, non-interest bearing, due on demand | ||
Notes Payable | 3,443 | |
Total | ||
Notes Payable | $ 94,933 | $ 8,000 |
Note 9 - Preferred Stock (Detai
Note 9 - Preferred Stock (Details) - shares | Sep. 30, 2016 | Dec. 31, 2015 | Oct. 29, 2015 |
Details | |||
Preferred Stock, Shares Issued | 0 | 0 | 10 |
Convertible Preferred Stock, Shares Issued upon Conversion | 10,000,000 |
Note 10 - Common Stock (Details
Note 10 - Common Stock (Details) - USD ($) | 3 Months Ended | 9 Months Ended | ||||||||||||||||||||
Sep. 30, 2016 | Dec. 31, 2015 | Sep. 30, 2015 | Jun. 30, 2015 | Mar. 31, 2015 | Sep. 30, 2016 | Sep. 30, 2015 | Mar. 09, 2016 | Jan. 02, 2016 | Dec. 30, 2015 | Nov. 16, 2015 | Aug. 21, 2015 | Aug. 19, 2015 | Aug. 18, 2015 | Aug. 14, 2015 | Aug. 04, 2015 | Jul. 31, 2015 | Jul. 06, 2015 | Jun. 14, 2015 | Mar. 26, 2015 | Mar. 19, 2015 | Jan. 05, 2015 | |
Common Stock, Shares Issued | 146,008,250 | 145,363,750 | 146,008,250 | |||||||||||||||||||
Accounts Payable, Current | $ 10,462 | |||||||||||||||||||||
Professional fees | $ 20,050 | $ 54,621 | $ 36,787 | $ 72,223 | ||||||||||||||||||
Common Stock, Par Value | ||||||||||||||||||||||
Notes Payable, Related Parties | $ 37,270 | |||||||||||||||||||||
Prosperity Stockholders | ||||||||||||||||||||||
Common Stock, Shares Issued | 36,354,077 | |||||||||||||||||||||
Marco Alfonsi | ||||||||||||||||||||||
Common Stock, Shares Issued | 10,000,000 | 70,166,750 | ||||||||||||||||||||
Loans Payable | $ 22,270 | |||||||||||||||||||||
Salaries, Wages and Officers' Compensation | $ 510,000 | |||||||||||||||||||||
Mckenzie Webster Limited | ||||||||||||||||||||||
Shares Retired | 70,166,750 | |||||||||||||||||||||
Investor 1 | ||||||||||||||||||||||
Common Stock, Shares Issued | 50,000 | 117,500 | ||||||||||||||||||||
Loans Payable | $ 25,000 | |||||||||||||||||||||
Accrued Interest | $ 4,375 | |||||||||||||||||||||
Professional fees | 14,995 | |||||||||||||||||||||
Common Stock Shares Sold | 1,000,000 | |||||||||||||||||||||
Common Stock, Par Value | $ 0.10 | |||||||||||||||||||||
Proceeds | $ 100,000 | |||||||||||||||||||||
Board of Directors | ||||||||||||||||||||||
Common Stock, Shares Issued | 5,000,000 | |||||||||||||||||||||
Salaries, Wages and Officers' Compensation | $ 400,000 | |||||||||||||||||||||
Vendor | ||||||||||||||||||||||
Common Stock, Shares Issued | 1,600,000 | |||||||||||||||||||||
Accounts Payable, Current | $ 82,376 | |||||||||||||||||||||
Two Consultants | ||||||||||||||||||||||
Common Stock, Shares Issued | 1,200,000 | |||||||||||||||||||||
Professional fees | 60,000 | |||||||||||||||||||||
Consultant for Services | ||||||||||||||||||||||
Common Stock, Shares Issued | 430,000 | |||||||||||||||||||||
Professional fees | 107,457 | |||||||||||||||||||||
Non US Invidividual Investor | ||||||||||||||||||||||
Common Stock Shares Sold | 1,000,000 | |||||||||||||||||||||
Common Stock, Par Value | $ 0.10 | |||||||||||||||||||||
Proceeds | $ 100,000 | |||||||||||||||||||||
Non US Entity Investor | ||||||||||||||||||||||
Common Stock Shares Sold | 1,000,000 | |||||||||||||||||||||
Common Stock, Par Value | $ 0.10 | |||||||||||||||||||||
Proceeds | $ 100,000 | |||||||||||||||||||||
Consultant for Services 2 | ||||||||||||||||||||||
Common Stock, Shares Issued | 400,000 | |||||||||||||||||||||
Professional fees | 90,000 | |||||||||||||||||||||
Bridge Loan Financing Agreement | ||||||||||||||||||||||
Common Stock, Shares Issued | 5,000,000 | |||||||||||||||||||||
Professional fees | $ 1,125,000 | |||||||||||||||||||||
Notes Payable, Related Parties | $ 50,000 | |||||||||||||||||||||
Debt Instrument, Unamortized Discount (Premium), Net | $ 47,872 | |||||||||||||||||||||
Accounting Services | ||||||||||||||||||||||
Common Stock, Shares Issued | 150,000 | |||||||||||||||||||||
Professional fees | $ 15,000 | |||||||||||||||||||||
Technical Consultant | ||||||||||||||||||||||
Common Stock, Shares Issued | 400,000 | 400,000 | 140,000 | 104,500 |
Note 11 - Stock Options and W56
Note 11 - Stock Options and Warrants: Schedule of Stockholders' Equity Note, Warrants or Rights (Details) - shares | Sep. 30, 2016 | Jan. 02, 2016 | Jan. 02, 2015 |
Stock Options | |||
Share-based Compensation Arrangement by Share-based Payment Award, Options, Outstanding, Number | 200,000 | 200,000 | 200,000 |
Warrants | |||
Share-based Compensation Arrangement by Share-based Payment Award, Options, Outstanding, Number | 307,500 | 307,500 | 307,500 |
Total | |||
Share-based Compensation Arrangement by Share-based Payment Award, Options, Outstanding, Number | 507,500 | 507,500 | 507,500 |
Note 11 - Stock Options and W57
Note 11 - Stock Options and Warrants: Schedule of Issued and Outstanding Stock Options Text Block (Details) | 9 Months Ended |
Sep. 30, 2016$ / sharesshares | |
2006 Stock Options | |
Share-based Compensation Arrangement by Share-based Payment Award, Options, Exercisable, Number | 150,000 |
Share-based Compensation Arrangement by Share-based Payment Award, Options, Exercisable, Weighted Average Exercise Price | $ / shares | $ 1 |
Share-based Compensation Arrangement by Share-based Payment Award, Expiration Period | 2016 years |
2009 Stock Options | |
Share-based Compensation Arrangement by Share-based Payment Award, Options, Exercisable, Number | 50,000 |
Share-based Compensation Arrangement by Share-based Payment Award, Options, Exercisable, Weighted Average Exercise Price | $ / shares | $ 1 |
Share-based Compensation Arrangement by Share-based Payment Award, Expiration Period | 2019 years |
Total 2 Stock Options | |
Share-based Compensation Arrangement by Share-based Payment Award, Options, Exercisable, Number | 200,000 |
Note 11 - Stock Options and W58
Note 11 - Stock Options and Warrants: Schedule of Issued and Outstanding Warrants Text Block (Details) | 9 Months Ended |
Sep. 30, 2016$ / sharesshares | |
2006 Warrants | |
Share-based Compensation Arrangement by Share-based Payment Award, Options, Exercisable, Number | 60,000 |
Share-based Compensation Arrangement by Share-based Payment Award, Options, Exercisable, Weighted Average Exercise Price | $ / shares | $ 1 |
Share-based Compensation Arrangement by Share-based Payment Award, Expiration Period | 2016 years |
2010 Warrants | |
Share-based Compensation Arrangement by Share-based Payment Award, Options, Exercisable, Number | 247,500 |
Share-based Compensation Arrangement by Share-based Payment Award, Options, Exercisable, Weighted Average Exercise Price | $ / shares | $ 1 |
Share-based Compensation Arrangement by Share-based Payment Award, Expiration Period | 2020 years |
Total Warrants | |
Share-based Compensation Arrangement by Share-based Payment Award, Options, Exercisable, Number | 307,500 |
Note 12 - Income Taxes_ Sched59
Note 12 - Income Taxes: Schedule of Share-based Compensation, Activity (Details) - USD ($) | 9 Months Ended | |
Sep. 30, 2016 | Sep. 30, 2015 | |
Details | ||
Income Tax Expense (Benefit) | $ (119,750) | $ (1,200,311) |
Effective Income Tax Rate Reconciliation, Nondeductible Expense, Share-based Compensation Cost, Amount | 10,500 | 397,745 |
Effective Income Tax Rate Reconciliation, Nondeductible Expense, Impairment Losses, Amount | 698,124 | |
Effective Income Tax Rate Reconciliation, Change in Deferred Tax Assets Valuation Allowance, Amount | $ 109,250 | $ 104,442 |
Note 12 - Income Taxes_ Sched60
Note 12 - Income Taxes: Schedule of Deferred Tax Assets and Liabilities (Details) - USD ($) | Sep. 30, 2016 | Dec. 31, 2015 |
Details | ||
Operating Loss Carryforwards | $ 1,194,524 | $ 1,085,274 |
Deferred Tax Assets, Valuation Allowance | $ (1,194,524) | $ (1,085,274) |
Note 12 - Income Taxes (Details
Note 12 - Income Taxes (Details) - USD ($) | Dec. 31, 2036 | Dec. 31, 2035 | Dec. 31, 2034 | Dec. 31, 2033 | Dec. 31, 2032 | Dec. 31, 2031 | Dec. 31, 2030 | Dec. 31, 2029 | Dec. 31, 2028 | Dec. 31, 2027 | Dec. 31, 2026 | Dec. 31, 2025 | Sep. 30, 2016 |
Details | |||||||||||||
Deferred Income Taxes and Other Assets, Current | $ 1,194,524 | ||||||||||||
Deferred Tax Assets, Operating Loss Carryforwards, Domestic | $ 3,412,925 | ||||||||||||
Deferred Tax Assets, Operating Loss Carryforwards | $ 312,142 | $ 345,921 | $ 28,511 | $ 311,890 | $ 166,911 | $ 135,096 | $ 151,874 | $ 159,141 | $ 686,775 | $ 594,905 | $ 518,390 | $ 1,369 |
Note 13 - Commitments and Con62
Note 13 - Commitments and Contingencies (Details) - USD ($) | 3 Months Ended | 9 Months Ended | 12 Months Ended | ||||||||||
Sep. 30, 2016 | Sep. 30, 2015 | Sep. 30, 2016 | Sep. 30, 2015 | Dec. 31, 2018 | Sep. 14, 2018 | Dec. 31, 2017 | Sep. 14, 2017 | Dec. 31, 2016 | Sep. 12, 2016 | Dec. 02, 2015 | Aug. 17, 2015 | May 14, 2015 | |
Rent expense | $ 16,265 | $ 22,108 | $ 48,795 | $ 37,108 | $ 27,900 | $ 3,100 | $ 36,472 | $ 3,009 | $ 9,118 | $ 2,922 | $ 2,500 | ||
Marco Alfonsi | |||||||||||||
Employee Cash Compensation | $ 5,000 | ||||||||||||
Romauld Stone | |||||||||||||
Employee Cash Compensation | $ 12,500 |
Note 13 - Commitments and Con63
Note 13 - Commitments and Contingencies: Schedule of Rent Expense (Details) - USD ($) | 3 Months Ended | 9 Months Ended | 12 Months Ended | ||||||||
Sep. 30, 2016 | Sep. 30, 2015 | Sep. 30, 2016 | Sep. 30, 2015 | Dec. 31, 2018 | Sep. 14, 2018 | Dec. 31, 2017 | Sep. 14, 2017 | Dec. 31, 2016 | Sep. 12, 2016 | Dec. 02, 2015 | |
Details | |||||||||||
Rent expense | $ 16,265 | $ 22,108 | $ 48,795 | $ 37,108 | $ 27,900 | $ 3,100 | $ 36,472 | $ 3,009 | $ 9,118 | $ 2,922 | $ 2,500 |