| 11. Equity | Stock
Subscriptions On
January 13, 2017, the Company issued 5,000 common shares for cash. Consideration to the Company was $5,000, or $1.00 per share. Stock
Compensation On
March 1, 2018, the Company issued 449,065 shares of the Company’s Series A Preferred Shares to its sole director and chief
executive officer for a value of $112,266, or $0.25 per share. The value was recorded against his accrued compensation payable. On
January 23, 2018, the Company issued 100,000,000 shares of its common stock to sole officer and director, Robert DeAngelis, as
his 2017 annual bonus per his employment agreement. The annual bonus, if any, is determined and paid in accordance with policies
set from time to time by the Board or Directors, in its sole discretion. The Board’s policy has been to base the stock price
for such issuances upon the average of the closing price of the preceding 10 trading days as reported on OTCMarkets website, which
was $0.0033; rendering the value of the preferred issued as $330,000. Since the Company’s closing stock price on the date
of grant was also $0.0033, the Company will not recognize any associated discounts or benefits associated with the shares issued. On
July 3, 2017, the Company’s Board of Directors authorized the issuance of 30,000,000 shares to the Company’s Chief
Executive Officer as a performance bonus pursuant to his employment agreement. The shares were valued at $0.03, the quoted market
price on the date of issuance, or $900,000. On
June 7, 2017, the Company issued 2,000,000 shares pursuant to a Service Agreement entered into on that date for investor relation
services. The shares were valued at $0.05 per share, the closing market price on the date of issuance, or $100,000. On July 6,
2017, the Company terminated the investor relation agreement. The common shares issued in this transaction will remain issued
and outstanding and the corresponding value of $100,000 was recorded to compensation expense. On
May 8, 2017, the Company issued 1,153,000 shares in consideration of financing received by the Company. The shares were valued
at $0.055, the quoted market price on the date of issuance, or $63,415. On
January 18, 2017, the Company issued 10,000 shares pursuant to a Consulting Agreement entered into on that date. The consultant
was engaged to perform research related to hemp processing in the State of Florida. The shares were valued at $3.20 per share,
the closing market price on the date of issuance, or $32,000. These services were completed prior to March 31, 2018 and as a result
the entire amount was recorded as compensation expense. Stock
Issued for Debt and Interest In
August 2018, the Company issued 23,930,852 shares of common stock in connection with a Securities Purchase Agreement and a Secured
Convertible Promissory Note that granted the investor a Warrant to purchase shares of the Company’s common stock. The shares
were valued at $3,350, or $0.00014 per share. In
June 2018, the Company issued 18,000,000 shares of common stock, for a value of $2,640 in satisfaction of $2,140 in interest and
$500 of conversion fees on a convertible note payable. The Company recorded the issuances at the contract value, at the date of
exchange, off-setting the notes payable and accrued interest. In
June 2018, the Company issued 21,950,893 shares of common stock in connection with a Securities Purchase Agreement and a Secured
Convertible Promissory Note that granted the investor a Warrant to purchase shares of the Company’s common stock. The shares
were valued at $3,073, or $0.00014 per share. In
May 2018, the Company issued 15,216,216 shares of common stock, for a value of $2,640 in satisfaction of $2,140 in interest and
$500 of conversion fees on a convertible note payable. The Company recorded the issuances at the contract value, at the date of
exchange, off-setting the notes payable and accrued interest. In
May 2018, the Company issued 15,229,730 shares of common stock, for a value of $2,640 in satisfaction of $2,140 in interest and
$500 of conversion fees on a convertible note payable. The Company recorded the issuances at the contract value, at the date of
exchange, off-setting the notes payable and accrued interest. In
May 2018, the Company issued 17,486,486 shares of common stock, for a value of $2,640 in satisfaction of $2,140 in interest and
$500 of conversion fees on a convertible note payable. The Company recorded the issuances at the contract value, at the date of
exchange, off-setting the notes payable and accrued interest. In
May 2018, the Company issued 19,081,081 shares of common stock, for a value of $2,640 in satisfaction of $2,140 in interest and
$500 of conversion fees on a convertible note payable. The Company recorded the issuances at the contract value, at the date of
exchange, off-setting the notes payable and accrued interest. In
May 2018, the Company issued 20,032,258 shares of common stock, for a value of $2,640 in satisfaction of $2,140 in interest and
$500 of conversion fees on a convertible note payable. The Company recorded the issuances at the contract value, at the date of
exchange, off-setting the notes payable and accrued interest. In
May 2018, the Company issued 13,290,323 shares of common stock, for a value of $2,640 in satisfaction of $2,140 in interest and
$500 of conversion fees on a convertible note payable. The Company recorded the issuances at the contract value, at the date of
exchange, off-setting the notes payable and accrued interest. In
May 2018, the Company issued 5,500,000 shares of common stock, for a value of $2,640 in satisfaction of $2,140 in interest and
$500 of conversion fees on a convertible note payable. The Company recorded the issuances at the contract value, at the date of
exchange, off-setting the notes payable and accrued interest. In
May 2018, the Company issued 14,440,896 shares of common stock in connection with a Securities Purchase Agreement and a Secured
Convertible Promissory Note that granted the investor a Warrant to purchase shares of the Company’s common stock. The shares
were valued at $3,033, or $0.00021 per share. In
May 2018, the Company issued 15,000,000 shares of common stock, for a value of $2,640 in satisfaction of $2,140 in interest and
$500 of conversion fees on a convertible note payable. The Company recorded the issuances at the contract value, at the date of
exchange, off-setting the notes payable and accrued interest. In
April 2018, the Company issued 12,608,108 shares of common stock, for a value of $2,640 in satisfaction of $2,140 in interest
and $500 of conversion fees on a convertible note payable. The Company recorded the issuances at the contract value, at the date
of exchange, off-setting the notes payable and accrued interest. In
April 2018, the Company issued 12,594,595 shares of common stock, for a value of $2,640 in satisfaction of $2,140 in interest
and $500 of conversion fees on a convertible note payable. The Company recorded the issuances at the contract value, at the date
of exchange, off-setting the notes payable and accrued interest. In
April 2018, the Company issued 12,608,108 shares of common stock, for a value of $2,640 in satisfaction of $2,140 in interest
and $500 of conversion fees on a convertible note payable. The Company recorded the issuances at the contract value, at the date
of exchange, off-setting the notes payable and accrued interest. In
April 2018, the Company issued 14,486,486 shares of common stock, for a value of $2,640 in satisfaction of $2,140 in interest
and $500 of conversion fees on a convertible note payable. The Company recorded the issuances at the contract value, at the date
of exchange, off-setting the notes payable and accrued interest. In
March 2018, the Company issued 11,000,000 shares of common stock, for a value of $2,640 in satisfaction of $2,140 in interest
and $500 of conversion fees on a convertible note payable. The Company recorded the issuances at the contract value, at the date
of exchange, off-setting the notes payable and accrued interest. In
February 2018, the Company issued 19,886,364 shares of common stock, for a value of $17,500 in satisfaction of $14,507 in principal
and $2,993 in interest on a convertible note payable. The Company recorded the issuances at the contract value, at the date of
exchange, off-setting the notes payable and accrued interest. In
February 2018, the Company issued 11,250,000 shares of common stock, for a value of $11,250 in satisfaction of $10,696 in principal
and $554 in interest on a convertible note payable. The Company recorded the issuances at the contract value, at the date of exchange,
off-setting the notes payable and accrued interest. In
February 2018, the Company issued 10,000,000 shares of common stock, for a value of $4,000 in satisfaction of $1,826 in principal,
$1,674 in interest, and $500 of conversion fees on a convertible note payable. The Company recorded the issuances at the contract
value, at the date of exchange, off-setting the notes payable and accrued interest. In
January 2018, the Company issued 4,672,000 shares of common stock, for a value of $6,541 in satisfaction of $6,041 in principal
and $500 of conversion fees on a convertible note payable. The Company recorded the issuances at the contract value, at the date
of exchange, off-setting the notes payable and accrued interest. In
January 2018, the Company issued 2,500,000 shares of common stock, for a value of $4,000 in satisfaction of $471 in principal,
$3,029 in interest, and $500 of conversion fees on a convertible note payable. The Company recorded the issuances at the contract
value, at the date of exchange, off-setting the notes payable and accrued interest. In
November 2017, the Company issued an aggregate of 5,000,000 shares of common stock, for a value of $5,000 in satisfaction of $4,859
in principal and $141 in interest on a convertible note payable. The Company recorded the issuances at the contract value, at
the date of exchange, off-setting the notes payable, accrued interest and the recorded derivative liability. In
November 2017, the Company issued an aggregate of 3,114,800 shares of common stock, for a value of $11,213 in satisfaction of
$461 in principal and $10,753 in interest on a convertible note payable. The Company recorded the issuances at the contract value,
at the date of exchange, off-setting the notes payable, accrued interest and the recorded derivative liability. In
November 2017, the Company issued an aggregate of 3,880,000 shares of common stock, for a value of $3,880 in satisfaction of $2,891
in principal and $989 in interest on a convertible note payable. The Company recorded the issuances at the contract value, at
the date of exchange, off-setting the notes payable, accrued interest and the recorded derivative liability. In
October 2017, the Company issued an aggregate of 3,690,476 shares of common stock, for a value of $31,000 in satisfaction of $30,519
in principal and $481 in interest on a convertible note payable. The Company recorded the issuances at the contract value, at
the date of exchange, off-setting the notes payable, accrued interest and the recorded derivative liability. In
October 2017, the Company issued 3,880,000 shares of common stock, for a value of $3,880 in satisfaction of $3,880 in interest
on a convertible note payable. The Company recorded the issuances at the contract value, at the date of exchange, off-setting
the notes payable, accrued interest and the recorded derivative liability. In
September 2017, the Company issued 3,571,429 shares of common stock, for a value of $30,000 in satisfaction of $23,273 in principal
and $6,727 in interest on a convertible note payable. The Company recorded the issuances at the contract value, at the date of
exchange, off-setting the notes payable, accrued interest and the recorded derivative liability. In
July 2017, the Company issued 3,350,000 shares of common stock, for a value of $3,350 in satisfaction of $3,350 accrued interest
on a convertible note payable. The Company recorded the issuances at the contract value, at the date of exchange, off-setting
the accrued interest and the recorded derivative liability. In
May 2017, the Company authorized the issuance of 1,153,000 shares of common stock, for a value of $63,415, in satisfaction of
$63,415 in finance costs associated with a convertible note payable. The Company recorded the issuance at the fair value on the
date of grant, which was $0.055 per share. Stock
Issued for Investment On
January 4, 2017, the Company executed an Asset Purchase Agreement with Patriot Bioenergy Corporation, a Kentucky corporation,
for the purchase of all of the assets related to the business of operating a hemp processing and growth operation and selling
hemp related products. Pursuant to the Agreement, the Company issued 50,000 common shares which were valued at $142,500 based
on the closing market price of the stock on the date of issuance. In addition, the Company paid expenses of Patriot totaling $19,500,
resulting in a total investment of $162,000 (see Note 5). Preferred
Stock On
March 1, 2018, the Company issued 449,065 shares of the Company’s non-convertible Series A Preferred Shares, with a par
value of $0.0001 and with an initial liquidation preference of $0.02 per share pursuant to its amended and restated Articles on
July 26, 2016, at a price of $0.02 per share, to its sole director and chief executive officer in exchange for $112,266 of accrued
compensation. The Company valued the transaction at $8,981and recognized the difference in fair value to additional paid in capital. Warrants On
the July 10, 2017, and in connection with a Securities Purchase Agreement and a Secured Convertible Promissory Note, the Company
issued a Warrant which grants the investor the right to purchase at any time on or after July 10, 2017, and for a period of five
years thereafter, a number of fully paid and non-assessable shares of the Company’s common stock equal to the amount of
the tranche received under the Note divided by $0.05. The conversion price is $0.50, as adjusted from time to time pursuant to
the terms and conditions of the Warrant. As of December 31, 2017, the Company received a tranche of $35,000; resulting in the
issuance of a warrant to purchase 700,000 shares of the Company’s common stock. The relative fair value of the warrant at
issuance was $12,565. The Company estimates the fair value at each reporting period using the Binomial Method. For the nine months
ended September 30, 2018, management determined that the Company’s common stock lacked liquidity and market value and therefore
no derivative liability was recorded in association with these warrants. The warrant derivative liability as of September 30,
2018 and December 31, 2017 was $0 and $32,268, respectively. During the nine months ended September 30, 2018, the Warrant Holder,
in a cashless exercise, was issued 60,322,741 shares of common stock for an aggregate value of $9,456 pursuant to anti-dilution
terms of the Warrant that adjusted the conversion price. On
the March 13, 2017, and in connection with a Securities Purchase Agreement and a Secured Convertible Promissory Note, the Company
issued a Warrant which grants the investor the right to purchase at any time on or after March 13, 2017, and for a period of three
years thereafter, a number of fully paid and non-assessable shares of the Company’s common stock equal to $57,500 divided
by the Market Price as of March 13, 2017. The Market Price, as calculated pursuant to the Warrant Agreement, was $0.1097 per share
with 524,157 being the resulting number of warrant shares at issuance. The relative fair value of the warrant at issuance was
$47,174, resulting in a debt discount equal to $10,326 which will be amortized over the life of the Warrant. The Company estimates
the fair value at each reporting period using the Binomial Method. As of March 31, 2018, management determined that the Company’s
common stock lacked liquidity and market value and therefore no derivative liability was recorded in association with these warrants.
The warrant derivative liability as of September 30, 2018 and December 31, 2017 was $0 and $2,779, respectively. Made effective
on July 20, 2018, the warrant to purchase shares previously issued under the Convertible Promissory Note was terminated by the
Warrant holder to facilitate the Company’s fundraising efforts. Other During
the year ended December 31, 2017, the Company received and canceled 9,000,000 common shares issued to employees of Patriot Bioenergy.
The Company recorded the cancelled shares at their par value. (see Note 5) On
April 21, 2017, the Company cancelled and terminated the Asset Purchase Agreement with Patriot Bioenergy Corporation that was
originally executed on January 4, 2017. REAC terminated the APA due to Patriot’s refusal to provide any financial information
to the Company as required by the Asset Purchase Agreement. On April 27, 2017, the 50,000 common shares were returned to the Company
and cancelled at their par value (see Note 5). On
May 1, 2017, the Company terminated an agreement for web services that was consummated during the year ended December 31, 2016.
As a result, 5,000,000 common shares associated with the agreement were returned to the Company and cancelled. During
the nine months ended September 30, 2018 and 2017, the Company recorded in-kind contributions for rent expense in the amount of
$900 and $900, respectively. Amendment
to the Articles of Incorporation On
February 20, 2018, the Board of Directors recommended and the majority shareholder (holding 83% of the voting shares) voted in
favor of increasing the authorized capital of the Company from Three Billion (3,000,000,000) shares, to Ten Billion (10,000,000,000)
shares. No change was made to the number of preferred shares authorized. Accordingly, as of February 20, 2018, the total authorized
capital of the Company will be comprised of Nine Billion Nine Hundred Ninety-Nine Million (9,999,000,000) shares of common stock,
par value $0.00001 per share, and One Million (1,000,000) shares of Preferred Stock, of which Five Hundred Thousand (500,000)
shares are designated as Series A Preferred Stock, par value $0.0001 per share. On
February 5, 2018, the Board of Directors recommended and the majority shareholder (holding 74% of the voting shares) voted in
favor of increasing the authorized capital of the Company from One Billion (1,000,000,000) shares, to Three Billion (3,000,000,000)
shares. No change was made to the number of preferred shares authorized. Accordingly, as of February 5, 2018, the total authorized
capital of the Company will be comprised of Two Billion Nine Hundred Ninety-Nine Million (2,999,000,000) shares of common stock,
par value $0.00001 per share, and One Million (1,000,000) shares of Preferred Stock, of which Five Hundred Thousand (500,000)
shares are designated as Series A Preferred Stock, par value $0.0001 per share. On
July 21, 2017, the Board of Directors recommended and the majority shareholder (holding 94% of the voting shares) voted in favor
of increasing the authorized capital of the Company from Two Hundred Fifty Million (250,000,000) shares, to One Billion (1,000,000,000)
shares. The Company filed the Articles of Amendment with the Florida Department of State, to be effective August 1, 2017. On
January 26, 2017, upon written consent of the board of directors and the majority shareholder, who holds enough common and preferred
shares to create a greater than 80% voting position, Article I of the Articles of Incorporation was amended to change the corporate
name to REAC GROUP, Inc. The effective date of the Amendment to the Articles of Incorporation is February 16, 2017 . As
of September 30, 2018, the total number of shares this corporation is authorized to issue is 10,000,000,000 (ten billion), allocated
as follows among these classes and series of stock:
Designation Par
value Shares Authorized
Common $ 0.00001 9,999,000,000
Preferred
Stock Class, Series A $ 0.0001 500,000
Preferred
Stock Class, Series B $ 0.0001 500,000 |
