Document and Entity Information
Document and Entity Information - USD ($) | 12 Months Ended | |
Dec. 31, 2016 | Mar. 20, 2017 | |
Document And Entity Information | ||
Entity Registrant Name | WORLDS ONLINE INC. | |
Entity Central Index Key | 1,522,767 | |
Document Type | 10-K | |
Document Period End Date | Dec. 31, 2016 | |
Amendment Flag | false | |
Current Fiscal Year End Date | --12-31 | |
Is Entity a Well-known Seasoned Issuer? | No | |
Is Entity a Voluntary Filer? | No | |
Is Entity's Reporting Status Current? | Yes | |
Entity Filer Category | Smaller Reporting Company | |
Entity Public Float | $ 23,288,895 | |
Entity Common Stock, Shares Outstanding | 64,244,170 | |
Document Fiscal Period Focus | FY | |
Document Fiscal Year Focus | 2,016 |
Balance Sheets
Balance Sheets - USD ($) | Dec. 31, 2016 | Dec. 31, 2015 |
Current Assets | ||
Cash | $ 569,356 | $ 160,859 |
Accounts receivable | 532,607 | 192,260 |
Deferred rent receivable | 536,248 | 275,088 |
Due from third party | 607,794 | 77,500 |
Due from - related party | 136,394 | 104,494 |
Notes receivables - Current | 120,920 | 100,767 |
Other current assets | 237,345 | 38,437 |
Total Current Assets | 2,740,664 | 949,405 |
Long Term Assets | ||
Notes receivables - long term | 587,592 | |
Rental properties | 543,377 | 2,096,596 |
Rental equipments | 5,195,818 | 84,140 |
Total Long Term Assets | 83,242 | 2,768,328 |
Total Assets | 5,822,437 | 3,717,733 |
Current Liabilities | ||
Account payable and accrued expenses | 2,118,412 | 1,816,663 |
Due to related parties | 148,337 | 125,902 |
Deferred revenue | 226,950 | 226,950 |
Other payable | 280,733 | 230,000 |
Mortgage payable | 2,865,112 | |
Notes Payables | 3,475,000 | 3,250,000 |
Total Current Liabilities | 7,136,546 | 5,649,517 |
Total Liabilities | 9,114,544 | 5,649,517 |
Stockholders (Deficit) | ||
Series A preferred stock (par value $0.001 authorized 5,000,000 shares, no shares are issued and outstanding) | ||
Series A preferred stock to be issued (300,000 and 0 shares as of December 31, 2016 and | 300 | |
Common Stock (par value $0.001 authorized 100,000,000 shares, 64,074,683 and 32,120,446 common shares issued and outstanding as of December 31, 2016 and December 31, 2015 respectively) | 64,075 | 32,120 |
Common stock subscribed but not yet issued (400,000 and 32,354,236 common shares as of December 31, 2016 and December 31, 2015, respectively) | 400 | 32,354 |
Subscription receivable | (25,000) | (25,000) |
Common Stock Warrants | 1,172,028 | 1,165,563 |
Additional Paid in Capital | 8,457,407 | 7,005,164 |
Accumulated Deficit | (10,777,657) | (10,196,094) |
Noncontrolling interest | 557,006 | 54,109 |
Total stockholders deficit | (551,443) | (1,931,784) |
Total Liabilities and Stockholders Deficit | $ 8,563,101 | $ 3,717,733 |
Balance Sheets (Parenthetical)
Balance Sheets (Parenthetical) - $ / shares | Dec. 31, 2016 | Dec. 31, 2015 |
Statement of Financial Position [Abstract] | ||
Common stock par value | $ 0.001 | $ 0.001 |
Common stock shares authorized | 100,000,000 | 100,000,000 |
Common stock issued | 64,074,683 | 32,120,446 |
Common stock outstanding | 64,074,683 | 32,120,446 |
Common stock subscribed not yet issued | 400,000 | 32,354,236 |
Statements of Operations
Statements of Operations - USD ($) | 12 Months Ended | |
Dec. 31, 2016 | Dec. 31, 2015 | |
Revenues | ||
Revenue | $ 3,564,120 | $ 1,270,176 |
Total | 3,564,120 | 1,270,176 |
Cost and Expenses | ||
Cost of Revenue | 1,351,742 | 1,566,821 |
Gross Income/(Loss) | 2,212,378 | (296,645) |
Equity compensation | 163,574 | 45,946 |
Amortization of intangible asset | 366,667 | |
Consulting expense | 146,346 | 60,000 |
Research & development | 93,106 | |
Promotion & Marketing | 293,490 | 20,343 |
Selling, General & Admin. | 770,459 | 567,939 |
Payroll and related taxes | 226,779 | 239,925 |
Total expenses | 1,600,648 | 1,393,926 |
Operating income (loss) | 611,730 | (1,690,571) |
Interest expense | (347,335) | (206,563) |
Interest income | 56,502 | 56,145 |
Warrant expense | ||
Loss on conversion of payable to common stock | (2,556) | |
Unrealized loss on trading securities | (434) | (3,838) |
Unrealized gain on trading securities | 702 | 480 |
Total other income (expense) | (290,565) | (156,332) |
Net (Loss) | 321,165 | (1,846,903) |
Less: Net loss attributable to noncontrolling interest | 520,017 | (631,569) |
Net (loss) attributable to Worlds Online common shareholders | $ (198,852) | $ (1,215,334) |
Weighted Average Loss per share (basic and fully diluted) | $ (0.04) | |
Weighted Average Common Shares Outstanding | 52,018,689 | 31,976,154 |
Statements of Cash Flows
Statements of Cash Flows - USD ($) | 12 Months Ended | |
Dec. 31, 2016 | Dec. 31, 2015 | |
Cash flows from operating activities: | ||
Net (loss) | $ (198,852) | $ (1,215,334) |
Net loss attributed to noncontrolling interest | 520,017 | (631,569) |
Adjustments to reconcile net (loss) to net cash provided by operating activities | ||
Depreciation expense | 265,746 | 839,336 |
Amortization of intangible asset | 366,667 | |
Unrealized loss on trading securities | 434 | 3,838 |
Unrealized gain on trading securities | (702) | (480) |
Equity compensation | 163,574 | 45,946 |
Accounts receivable & deferred rent receivable | (601,507) | (473,415) |
Due from - related party | (31,900) | 3,857 |
Other current assets | (198,908) | (19,725) |
Due from third party | (530,294) | (77,500) |
Due to related party | 22,435 | |
Acounts payable and accrued expenses | 341,292 | 760,498 |
Other payable | 50,733 | 5,000 |
Net cash (used in) operating activities: | (197,932) | (392,881) |
Cash used for trading securities | ||
Collection of notes payable | 24,062 | (456,316) |
Investment in third party | ||
Purchase of fixed assets | (3,364,070) | (3,048,776) |
Net cash provided by investing activities: | (3,340,008) | (3,505,092) |
Proceeds from related party | 378,964 | |
Proceeds from notes payable | 950,000 | 1,200,000 |
Repayment of note payable | (175,000) | |
Note proceeds from Mortgage | 2,865,112 | |
Distributions to investors | (399,831) | (8,868) |
Proceeds from sales of Preferred stock | 300,000 | |
Proceeds from Mari holdings MD Class A shares | 200,000 | |
Proceeds from Mia Dev Class A shares | 206,157 | 1,500,469 |
Net cash provided by financing activities | 3,946,438 | 3,070,565 |
Net (decrease) in cash and cash equivalents | 408,498 | (827,408) |
Cash and cash equivalents beginning of period | 160,859 | 988,268 |
Cash and cash equivalents end of period | 569,356 | 160,859 |
Non-cash financing activities: | ||
Common stock issued for accrued expenses | ||
Cash paid during the period for: | ||
Interest | 233,673 | 81,062 |
Income taxes | 456 | 456 |
Non-cash Activities | ||
Issuance of Equity to retire interest payable | $ 39,332 | |
Converting related party liabilities to Equity | 550,000 | 300,000 |
Issuance common stock to repay accounts payables | $ 0 | $ 24,932 |
Shareholders Equity
Shareholders Equity - USD ($) | Series A Preferred Stock subcribed not yet issued | Common Stock | Common Stock Subscribed Bu tNot Issued | Additional Paid-In Capital | Subcription Receivable | Common Stock Warrants | Retained Earnings / Accumulated Deficit | Non-Controlling Interest | Total |
Beginning balance, shares at Dec. 31, 2014 | 31,954,236 | 32,354,236 | |||||||
Beginning balance, amount at Dec. 31, 2014 | $ 31,954 | $ 32,354 | $ 6,056,740 | $ 1,165,563 | $ (8,971,892) | $ (242,909) | $ (1,928,190) | ||
Class A shares in Mia Develpoment | 877,713 | (25,000) | 947,756 | 1,800,469 | |||||
Stock options for directors and officers | 45,946 | 45,946 | |||||||
Payment of accrued expense, shares | 166,210 | ||||||||
Payment of accrued expense, amount | $ 166 | 24,765 | 24,931 | ||||||
Dividend distribution | (8,868) | (19,169) | (28,037) | ||||||
Net Income Loss for the year | (1,215,334) | (631,569) | (1,846,903) | ||||||
Ending balance, shares at Dec. 31, 2015 | 32,120,446 | 32,354,236 | |||||||
Ending Balance, amount at Dec. 31, 2015 | $ 32,120 | $ 32,354 | 7,005,164 | (25,000) | 1,165,563 | (10,196,094) | 54,109 | (1,931,784) | |
Dividend distribution | (399,831) | (399,831) | |||||||
Issuance of common stock, shares | 31,954,236 | (31,954,236) | |||||||
Issuance of common stock, amount | $ 31,954 | $ (31,954) | |||||||
Series A preferred stock fund raising, shares | 300,000 | ||||||||
Series A preferred stock fund raising, amount | $ 300 | 299,700 | 300,000 | ||||||
Warrants attached with subscription receivables | (6,465) | 6,465 | |||||||
Warrants issued for expense | 163,574 | 163,574 | |||||||
Sales or conversion of the ownership of subsidiaries | 995,434 | 995,434 | |||||||
NCI changes in Balance Sheets | $ 17,120 | $ (17,120) | |||||||
Net Income Loss for the year | $ 321,165 | ||||||||
Ending balance, shares at Dec. 31, 2016 | 300,000 | 64,074,682 | 400,000 | (198,852) | 520,017 | 321,165 | |||
Ending Balance, amount at Dec. 31, 2016 | $ 300 | $ 64,075 | $ 400 | $ 8,457,407 | $ (25,000) | $ 1,172,028 | $ (10,777,657) | $ 557,006 | $ (551,443) |
NOTE 1 - DESCRIPTION OF BUSINES
NOTE 1 - DESCRIPTION OF BUSINESS & SUMMARY OF ACCTING POLICIES | 12 Months Ended |
Dec. 31, 2016 | |
Notes to Financial Statements | |
NOTE 1 - DESCRIPTION OF BUSINESS & SUMMARY OF ACCTING POLICIES | NOTE 1 - DESCRIPTION OF BUSINESS AND SUMMARY OF ACCOUNTING POLICIES Description of Business We currently operate in two separate segments with one segment being a 3D entertainment portal which leverages its proprietary licensed technology to offer visitors a network of virtual, multi-user environments which we call "worlds" and the second segment being a management company in the medical cannabis industry. We were formed on January 25, 2011 as a wholly-owned subsidiary of Worlds Inc. (formerly known as Worlds.com Inc.). Effective May 16, 2011 Worlds Inc. transferred to us the majority of its operations and related operational assets, except for its patent portfolio. Worlds Inc. has also given us a perpetual world-wide license to its patented technology. Pursuant to the license and we have the right to issue unlimited sublicenses to the licensed technology, subject to Worlds Inc.’s reasonable consent. The assets transferred to us include: Worlds Inc.’s technology platform, Worlds Chat, Aerosmith World, DMC Worlds, Cinema Virtual, Pearson contracts and related revenue, the following URLs: Worlds.com, Cybersexworld.com, Hang.com, and Worldsfunds.com, a digital inventory of over 10,000 3D objects, animation sequences, an extensive avatar library, texture maps and virtual world architectures. The transfer of assets occurred in the context of the spin-off by Worlds Inc. of its online and operational technologies businesses to us. The spin-off was effectuated by Worlds Inc. declaring a dividend of its shares of its then wholly-owned subsidiary, Worlds Online, Inc. with each share of Worlds Inc. to receive 1/3 of a share of Worlds Online with all fractional shares rounded up. Worlds Inc. did not want a trading market to develop for its shares until the SEC completed its review of its registration statement on Form 10. Accordingly, the actual distribution of the dividend did not occur until the payment date of March 12, 2012. Our stock is quoted on the OTC Bulletin Board. Approximately 23,859,248 shares were issued as part of the dividend distribution and immediately following the distribution Worlds Inc. continued to own approximately 19.6% of our outstanding shares. Worlds Inc. intends to dispose of its stock in an orderly fashion into the open market or in private sales, in either case in ways designed not to impact the market, but in any event within five years of the dividend payment debt. While it holds any of our shares it will vote them in proportion to the votes by other stockholders. On May 19, 2014, Worlds Online Inc. (the “Company”) entered into a Membership Interest Purchase Agreement (the “Agreement”) between MariMed Advisors Inc. (“MariMed”), a wholly owned subsidiary of the Company, Sigal Consulting LLC (“Sigal”), a Massachusetts limited liability company, and the Members of Sigal (“Sellers”). The transaction closed on September 29, 2014. Pursuant to the Agreement, the Company, through MariMed, acquired all of the assets of Sigal and the Sellers received the aggregate amount of (i) the Company’s common stock (WORX) equal to 50% of the Company’s outstanding common stock on the Closing Date; (ii) three million options to purchase shares of the Company’s common stock which are exercisable over five years with various exercise prices ranging from $0.15 to $0.35 and (iii) 49% of MariMed’s outstanding common stock. As a result, the Company’s ownership of MariMed was reduced from 100% to 51%. The transaction was accounted for as a purchase acquisition/merger wherein the Company is both accounting acquirer and legal acquirer. Accordingly, the company recorded the assets purchased and liabilities assumed as part of the merger and the portion that the fair value of the common stock issued and options granted for acquisition over the book value of Sigal was recorded as goodwill, which was subsequently impaired in full. Basis of Presentation The accompanying financial statements have been prepared in conformity with accounting principles generally accepted in the United States of America ("US GAAP"), which contemplates continuation of the Company as a going concern. The Company will require substantial additional funds for development and marketing of its products. There can be no assurance that the Company will be able to obtain the substantial additional capital resources necessary to pursue its business plan or that any assumptions relating to its business plan will prove to be accurate. We were not able to generate sufficient revenue or obtain sufficient financing which had a material adverse effect on our ability to grow our business Use of Estimates The preparation of financial statements in conformity with US GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosures of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from these estimates. Trading Securities Trading securities are common stock in publicly traded companies, one that was received as compensation for performing consulting services. The other was purchased as an investment. The carrying value of the investments is the market price of the shares at December 31, 2016 and December 31, 2015. Any unrealized gain or loss are recorded under other income/(expense) in the accompanying statements of operations. Cash and Cash Equivalents Cash and cash equivalents are comprised of highly liquid money market instruments, which have original maturities of three months or less at the time of purchase. Revenue Recognition The Company has the following source of revenue: VIP subscriptions to our Worlds Ultimate 3-D Chat service and consulting and other revenues from MariMed. The Company recognizes revenue when all of the following criteria are met: evidence of an arrangement exists such as a signed contract, delivery has occurred, the price is fixed or determinable, and collectability is reasonable assured. This will usually be in the form of a receipt of a customer’s acceptance indicating the product has been completed to their satisfaction except for development work and service revenue which is recognized when the services have been performed. Deferred revenue represents cash payments received in advance to be recorded as revenue when earned. The corresponding cost associated with those contracts is also deferred as deferred costs until the revenue is ultimately recognized. Research and Development Costs Research and development costs will be charged to operations as incurred. Intangible Asset - Websites The Company purchased several medical marijuana related websites in 2014. The websites cost were being amortized using the straight line method over a period of five years. It was determined that the websites were not generating a deal flow for us and was not generating any expected future economic benefit so the balance was written off at the end of 2015. Property and Equipment Property and equipment will be stated at cost. Depreciation will be provided on a straight line basis over the estimated useful lives of the assets ranging from three to five years. When assets are retired or disposed of, the cost and accumulated depreciation are removed from the accounts, and any resulting gains or losses are included in income. Maintenance and repairs will be charged to expense in the period incurred. Impairment of Long Lived Assets The Company evaluates the recoverability of its fixed assets and other assets in accordance with section 360-10-15 of the FASB Accounting Standards Codification (“ASC”) for disclosures about Impairment or Disposal of Long-Lived Assets. Disclosure requires recognition of impairment of long-lived assets in the event the net book value of such assets exceeds its expected cash flows. If so, it is considered to be impaired and is written down to fair value, which is determined based on either discounted future cash flows or appraised values. Fair Value of Financial Instruments The Company follows paragraph 825-10-50-10 of the FASB ASC for disclosures about fair value of its financial instruments and paragraph 820-10-35-37 of the FASB ASC (“Paragraph 820-10-35-37”) to measure the fair value of its financial instruments. Paragraph 820-10-35-37 establishes a framework for measuring fair value in US GAAP, and expands disclosures about fair value measurements. To increase consistency and comparability in fair value measurements and related disclosures, Paragraph 820-10-35-37 establishes a fair value hierarchy which prioritizes the inputs to valuation techniques used to measure fair value into three broad levels. The fair value hierarchy gives the highest priority to quoted prices (unadjusted) in active markets for identical assets or liabilities and the lowest priority to unobservable inputs. The three levels of fair value hierarchy defined by Paragraph 820-10-35-37 are described below: Level 1 Quoted market prices available in active markets for identical assets or liabilities as of the reporting date. Level 2 Pricing inputs other than quoted prices in active markets included in Level 1, which are either directly or indirectly observable as of the reporting date. Level 3 Pricing inputs that are generally observable inputs and not corroborated by market data. The carrying amounts of the Company’s financial assets and liabilities, such as cash and accounts payable approximate their fair values because of the short maturity of these instruments. Accounts Payable Related Party Accounts payable related party is comprised of cash payments made by Worlds Inc. on our behalf for shared operating expenses. Deferred Revenue Deferred revenue represents advance payments for the license, the design and development of the software, content and related technology for the creation of an interactive, 3D entertainment portal on the internet. Extinguishment of liabilities The Company accounts for extinguishment of liabilities in accordance with the guidance set forth in section 405-20 of the FASB ASC 405-20. Extinguishments of Liabilities Stock-Based Compensation The Company accounts for stock-based compensation using the fair value method following the guidance set forth in section 718-10 of the FASB ASC for disclosure about Stock-Based Compensation. This section requires a public entity to measure the cost of employee services received in exchange for an award of equity instruments based on the grant-date fair value of the award (with limited exceptions). That cost will be recognized over the period during which an employee is required to provide service in exchange for the award- the requisite service period (usually the vesting period). No compensation cost is recognized for equity instruments for which employees do not render the requisite service. Real estate tax escrow Real estate tax escrow consists of funds held for the purpose of real estate taxes owed. These funds will be released as required to satisfy tax payments as due. Rental properties Rental properties are carried at cost less accumulated depreciation and amortization. Betterments, major renovations and certain costs directly related to the improvement of rental properties are capitalized. Maintenance and repair expenses are charged to expense as incurred. Depreciation is recognized on a straight-line basis over estimated useful lives of the assets, which range from 7 to 39 years. Tenant improvements are amortized on a straight-line basis over the lives of the related leases, which approximate the useful lives of the assets. Upon the acquisition of real estate, the Company assesses the fair value of acquired assets (including land, buildings and improvements, identified intangibles, such as acquired above-market leases and acquired in-place leases) and acquired liabilities (such as acquired below-market leases) and allocate the purchase price based on these assessments. The Company assesses fair value based on estimated cash flow projections that utilize appropriate discount and capitalization rates and available market information. Estimates of future cash flows are based on a number of factors including historical operating results, known trends, and market/economic conditions. The Company’s rental properties are individually reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. An impairment exists when the carrying amount of an asset exceeds the aggregate projected future cash flows over the anticipated holding period on an undiscounted basis. An impairment loss is measured based on the excess of the property’s carrying amount over its estimated fair value. Impairment analyses are based on our current plans, intended holding periods and available market information at the time the analyses are prepared. If the Company’s estimates of the projected future cash flows, anticipated holding periods, or market conditions change, the Company’s evaluation of impairment losses may be different and such differences could be material to its consolidated financial statements. The evaluation of anticipated cash flows is subjective and is based, in part, on assumptions regarding future occupancy, rental rates and capital requirements that could differ materially from actual results. For the years ended December 31, 2016 and 2015, the Company did not record any impairment losses. The Company has capitalized land, which is not subject to depreciation. Income Taxes The Company accounts for income taxes under Section 740-10-30 of the FASB ASC (“ASC 740”). Deferred income tax assets and liabilities are determined based upon differences between the financial reporting and tax basis of assets and liabilities and are measured using the enacted tax rates and laws that will be in effect when the differences are expected to reverse. Deferred tax assets are reduced by a valuation allowance to the extent management concludes it is more likely than not that the assets will not be realized. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in the consolidated statements of operations in the period that includes the enactment date. ASC 740 prescribes a comprehensive model for how companies should recognize, measure, present, and disclose in their financial statements uncertain tax positions taken or expected to be taken on a tax return. Under ASC 740, tax positions must initially be recognized in the financial statements when it is more likely than not the position will be sustained upon examination by the tax authorities. Such tax positions must initially and subsequently be measured as the largest amount of tax benefit that has a greater than 50% likelihood of being realized upon ultimate settlement with the tax authority assuming full knowledge of the position and relevant facts. Related Party Transactions The Company follows subtopic 850-10 of the FASB ASC for the identification of related parties and disclosure of related party transactions. Pursuant to Section 850-10-20 the Related parties include a. affiliates of the Company; b. Entities for which investments in their equity securities would be required, absent the election of the fair value option under the Fair Value Option Subsection of Section 825–10–15, to be accounted for by the equity method by the investing entity; c. trusts for the benefit of employees, such as pension and profit-sharing trusts that are managed by or under the trusteeship of management; d. principal owners of the Company; e. management of the Company; f. other parties with which the Company may deal if one party controls or can significantly influence the management or operating policies of the other to an extent that one of the transacting parties might be prevented from fully pursuing its own separate interests; and g. Other parties that can significantly influence the management or operating policies of the transacting parties or that have an ownership interest in one of the transacting parties and can significantly influence the other to an extent that one or more of the transacting parties might be prevented from fully pursuing its own separate interests. The financial statements shall include disclosures of material related party transactions, other than compensation arrangements, expense allowances, and other similar items in the ordinary course of business. However, disclosure of transactions that are eliminated in the preparation of financial statements is not required in those statements. The disclosures shall include: a. the nature of the relationship(s) involved; b. a description of the transactions, including transactions to which no amounts or nominal amounts were ascribed, for each of the periods for which income statements are presented, and such other information deemed necessary to an understanding of the effects of the transactions on the financial statements; c. the dollar amounts of transactions for each of the periods for which income statements are presented and the effects of any change in the method of establishing the terms from that used in the preceding period; and d. amounts due from or to related parties as of the date of each balance sheet presented and, if not otherwise apparent, the terms and manner of settlement. Comprehensive Income (Loss) The Company reports comprehensive income and its components following guidance set forth by section 220-10 of the FASB ASC which establishes standards for the reporting and display of comprehensive income and its components in the consolidated financial statements. There were no items of comprehensive income (loss) applicable to the Company during the period covered in the financial statements. Loss Per Share Net loss per common share is computed pursuant to section 260-10-45 of the FASB ASC. Basic net loss per share is computed by dividing net loss by the weighted average number of shares of common stock outstanding during the period. Diluted net loss per share is computed by dividing net loss by the weighted average number of shares of common stock and potentially outstanding shares of common stock during each period. As of December 31, 2016, there were 9,250,000 options and 1,185,000 warrants whose effect is anti-dilutive and not included in diluted net loss per share at December 31, 2016. The options and warrants may dilute future earnings per share. Commitments and Contingencies The Company follows subtopic 450-20 of the FASB ASC to report accounting for contingencies. Certain conditions may exist as of the date the financial statements are issued, which may result in a loss to the Company but which will only be resolved when one or more future events occur or fail to occur. The Company assesses such contingent liabilities, and such assessment inherently involves an exercise of judgment. In assessing loss contingencies related to legal proceedings that are pending against the Company or unasserted claims that may result in such proceedings, the Company evaluates the perceived merits of any legal proceedings or unasserted claims as well as the perceived merits of the amount of relief sought or expected to be sought therein. If the assessment of a contingency indicates that it is probable that a material loss has been incurred and the amount of the liability can be estimated, then the estimated liability would be accrued in the Company’s financial statements. If the assessment indicates that a potentially material loss contingency is not probable but is reasonably possible, or is probable but cannot be estimated, then the nature of the contingent liability, and an estimate of the range of possible losses, if determinable and material, would be disclosed. Loss contingencies considered remote are generally not disclosed unless they involve guarantees, in which case the guarantees would be disclosed. Management does not believe, based upon information available at this time that these matters will have a material adverse effect on the Company’s financial position, results of operations or cash flows. However, there is no assurance that such matters will not materially and adversely affect the Company’s business, financial position, and results of operations or cash flows. Risk and Uncertainties The Company is subject to risks common to companies in the technology industries, including, but not limited to, litigation, development of new technological innovations and dependence on key personnel. The Company is also subject to risks arising from its medical marijuana related business inasmuch as marijuana is still a federally prohibited substance. Off Balance Sheet Arrangements The Company does not have any off-balance sheet arrangements. Uncertain Tax Positions The Company did not take any uncertain tax positions and had no adjustments to unrecognized income tax liabilities or benefits pursuant to the provisions of Section 740-10-25 for the years ended December 31, 2016 or 2015. Acquisition On September 29, 2014 our wholly-owned subsidiary, MariMed Advisors Inc. ("MariMed"), acquired all of the outstanding assets of Sigal Consulting LLC ("Sigal") from its members, The purchase price consisted of 31,954,236 shares of the Company's common stock, 3 million five-year options to purchase additional shares of our common stock at prices ranging from $0.15 - $0.35 per share and which vest over two years and 49% of MariMed's outstanding equity. The fair value of the common stock issued was $5,911,534 determined by the fair value of the Company’s Common Stock on the closing date, at a price of approximately $0.185 per share. The fair value of the stock options was $569,682 measured using the Black-Scholes valuation model on the grant date, assuming approximately 1.56% risk-free interest, 0% dividend yield, 311% volatility, and expected life of five years. The fair value of common stock issued and options granted for acquisition over the book value of Sigal is recorded as goodwill, which was subsequently impaired in full. Two of the owners of Sigal, Robert Fireman and Jon Levine are directors of the Company. Subsequent Events The Company evaluated for subsequent events through the issuance date of the Company’s financial statements. The Company raised $1,600,000 in March by issuing 7,978,888 shares of common stock to accredited investors at a price per share between $0.18 per share and $0.25 per share. The Company also voted to approve authorizing up to 500 million shares of common stock and 50 million shares of preferred stock. Recent Accounting Pronouncements In May 2014, the FASB issued Accounting Standards Update No. 2014-09, “Revenue from Contracts with Customers.” This amendment outlines a single comprehensive model for entities to use in accounting for revenue arising from contracts with customers and supersedes most current revenue recognition guidance, including industry-specific guidance. The core principle of the revenue model is that “an entity recognizes revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services.” The new guidance applies to all contracts with customers except those that are within the scope of other topics in GAAP. This amendment is effective for annual reporting periods, including interim reporting periods within those periods, beginning after December 15, 2016, and is not expected to have a material impact on the Company’s unaudited interim Consolidated Financial Statements. The Company has reviewed all recently issued, but not yet effective, accounting pronouncements up to ASU 2015-16, and does not believe the future adoption of any such pronouncements may be expected to cause a material impact on its financial condition or the results of its operations. |
NOTE 2 - GOING CONCERN
NOTE 2 - GOING CONCERN | 12 Months Ended |
Dec. 31, 2016 | |
Note 2 - Going Concern | |
NOTE 2 - GOING CONCERNS | NOTE 2 - GOING CONCERN The accompanying financial statements have been prepared assuming that the Company will continue as a going concern. Worlds Online Inc. has a negative working capital, and has a negative stockholders deficit and negative cash flows from operations. There can be no assurance that the Company will be able to obtain the substantial additional capital resources necessary to fully implement its business plan or that any assumptions relating to its business plan will prove to be accurate. The Company is pursuing sources of additional financing and there can be no assurance that any such financing will be available to the Company on commercially reasonable terms, or at all. Any inability to obtain additional financing will likely have a material adverse effect on the Company, including possibly requiring the Company to reduce and/or cease operations. These factors raise substantial doubt about the ability of the Company to continue as a going concern. The financial statements do not include any adjustments that might result from the outcome of this uncertainty. |
NOTE 3 - EQUITY
NOTE 3 - EQUITY | 12 Months Ended |
Dec. 31, 2016 | |
Deferred Costs, Capitalized, Prepaid, and Other Assets Disclosure [Abstract] | |
NOTE 3 – EQUITY | NOTE 3 - USE OF EQUITY AS COMPENSATION During the year ended December 31, 2016 the Company issued 31,954,237 shares of common stock related to the acquisition of all the outstanding equity of Sigal from its members by our wholly owned subsidiary, MariMed. The acquisition occurred in 2014 but the shares were delivered in April of 2016. During the year ended December 31, 2016 the Company issued 300,000 shares of preferred stock. The preferred stock accrues a dividend of six percent and converts along with the accrued dividend into common stock at a twenty five percent discount to the selling price of the common stock in a qualified round. During the year ended December 31, 2016, the Company issued 1,070,000 warrants to six accredited investors. The warrants allow the investors to purchase 1,070,000 shares of the Company's common stock at $0.10 per share per each warrant. The warrants expire between February and November of 2019 in October of 2019. During the year ended December 31, 2016, two of the outstanding notes were converted into Mia Development Class A shares. During the year ended December 31, 2015, the Company issued an aggregate of 166,210 shares of common stock as payment for an accrued expense with an aggregate value of $22,375. During the year ended December 31, 2015, the Company issued 300,000 options to the Company's directors. The directors each received 100,000 options for serving as board members in 2015. The stock options allow each director to purchase 100,000 shares of the Company's common stock at $0.13 per share per each individual option. An additional 300,000 options were issued to the Chief Financial Officer of the Company. The stock options to the Company's Chief Financial Officer allow for the purchase of 300,000 shares of the Company's common stock at $0.13 per share per each individual option. The options expire on June 29, 2020. Refer to Note 6 for further discussion. During the year ended December 31, 2015, the Company issued 55,000 warrants to two accredited investors. The warrants allow the investors to purchase 55,000 shares of the Company's common stock at $0.10 per share per each warrant. The warrants expire on June 30, 2018. |
NOTE 4 - DEFERRED REVENUE
NOTE 4 - DEFERRED REVENUE | 12 Months Ended |
Dec. 31, 2016 | |
Deferred Revenue Disclosure [Abstract] | |
NOTE 4 - DEFERRED REVENUE | NOTE 4 - DEFERRED REVENUE Deferred revenue represents advance payments for the license, the design and development of the software, content and related technology for the creation of an interactive, 3D entertainment portal on the internet. During the year ended December 31, 2016, no services were provided. The deferred revenue balance is $226,950. |
NOTE 5 - PROPERTY AND EQUIPMENT
NOTE 5 - PROPERTY AND EQUIPMENT | 12 Months Ended |
Dec. 31, 2016 | |
Notes to Financial Statements | |
NOTE 5 - PROPERTY AND EQUIPMENT | NOTE 5 - PROPERTY AND EQUIPMENT At December 31, 2016 and 2015, property and equipment consisted of the following: Description Useful Life (Years) December 31, December 31, Rental properties X – XX $ 6,186,725 $ 2,837,511 Rental Equipment 7 228,523 182,561 6,415,248 3,020,072 Less: accumulated depreciation (1,136,188 ) (839,336 ) Property and equipment, net $ 5,279,060 $ 2,180,736 For the years ended December 31, 2016 and 2015, depreciation expense amounted to $265,746 and $839,336, respectively. |
NOTE 6 - STOCK OPTIONS
NOTE 6 - STOCK OPTIONS | 12 Months Ended |
Dec. 31, 2016 | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |
NOTE 6 - STOCK OPTIONS | NOTE 6 - STOCK OPTIONS During the year ended December 31, 2016 no stock options were issued. The Director options were supposed to be issued as their fee for being board members but were not issued. The options will be issued in 2017. During the year ended December 31, 2016 the Company issued 1,130,000 warrants and recorded an equity compensation expense of $163,574 equal to the estimated fair value of the options at the date of grants. The fair market value was calculated using the Black-Scholes options pricing model, assuming approximately 0.41% risk-free interest, 0% dividend yield, 265% volatility, and expected life of 3 years. No stock options or warrants were exercised during the year ended December 31, 2016. During the year ended December 31, 2015, the Company issued 300,000 options to the Company’s directors. The directors each received 100,000 options for serving as board members in 2015. An additional 300,000 options were issued to the Chief Financial Officer of the Company. The stock options allow each director to purchase 100,000 shares of the Company’s common stock at $0.13 per share per each individual option. The stock options to the Company’s Chief Financial Officer allow for the purchase of 300,000 shares of the Company’s common stock at $0.13 per share per each individual option. The options expire on June 29, 2020. During the year ended December 31, 2015, the Company recorded an Equity compensation expense of $45,946 equal to the estimated fair value of the options at the date of grants. The fair market value was calculated using the Black-Scholes options pricing model, assuming approximately 1.63% risk-free interest, 0% dividend yield, 175% volatility, and expected life of 5 years. During the year ended December 31, 2015, the Company issued 55,000 warrants and recorded a warrant expense of $7,036 equal to the estimated fair value of the options at the date of grants. The fair market value was calculated using the Black-Scholes options pricing model, assuming approximately 1.63% risk-free interest, 0% dividend yield, 271% volatility, and expected life of 3 years. No stock options or warrants were exercised during the year ended December 31, 2015. Stock options outstanding and exercisable as of December 31, 2016 are as follows: Exercise Price per Share Shares Under Option Remaining Life in Years Outstanding $ 0.08 450,000 2.00 $ 0.025 200,000 1.00 $ 0.025 500,000 0.97 $ 0.01 4,500,000 0.67 $ 0.13 600,000 3.50 $ 0.15 1,000,000 2.39 $ 0.25 1,000,000 2.39 $ 0.35 1,000,000 2.39 9,250,000 Exercisable $ 0.08 450,000 2.00 $ 0.025 200,000 1.00 $ 0.025 500,000 0.97 $ 0.01 4,500,000 0.67 $ 0.13 600,000 3.50 $ 0.15 1,000,000 2.39 $ 0.25 1,000,000 2.39 8,250,000 |
NOTE 7 - INCOME TAXES
NOTE 7 - INCOME TAXES | 12 Months Ended |
Dec. 31, 2016 | |
Income Tax Disclosure [Abstract] | |
NOTE 7 - INCOME TAXES | NOTE 7 - INCOME TAXES At December 31, 2016, the Company had federal and state net operating loss carry forwards of approximately $3,020,372 that expire in 2037. Due to operating losses, there is no provision for current federal or state income taxes for the periods ended December 31, 2016 or 2015. Deferred income taxes reflect the net tax effects of temporary differences between the carrying amounts of assets and liabilities for financial reporting purposes and the amount used for federal and state income tax purposes. The Company’s deferred tax asset at December 31, 2016 consists of a net operating loss calculated using federal and state effective tax rates equating to approximately $1,403,000 less a valuation allowance in the amount of approximately $1,403,000. Because of the Company’s lack of earnings history, the deferred tax asset has been fully offset by a valuation allowance. The measurement valuation allowance increased by $77,552 and $293,232 during the 2016 and 2015 periods respectively. The Company’s total deferred tax asset as of December 31, 2016 is as follows: Deferred tax asset – gross $ 1,403,000 Valuation allowance (1,403,000 ) Net deferred tax asset $ — The reconciliation of income taxes computed at the federal and state statutory income tax rate to total income taxes for the periods ended December 31, 2016 and 2015 is as follows: 2016 2015 Income tax computed at the federal statutory rate 34 % 34 % Income tax computed at the state statutory rate 5 % 5 % Valuation allowance (39 %) (39 %) Total deferred tax asset 0 % 0 % |
NOTE 8 - TRADING SECURITIES
NOTE 8 - TRADING SECURITIES | 12 Months Ended |
Dec. 31, 2016 | |
Marketable Securities [Abstract] | |
NOTE 8 - TRADING SECURITIES | NOTE 8 - Trading Securities Marketable equity securities Cost Market value Unrealized Gain/(Loss) Paid, Inc. $ 13,200 $ 638 $ (12,561 ) Global Links Corp. $ 381 $ 0 $ (381 ) Fair market measurement at December 31, 2016 were computed using quoted prices in an active market for identified assets, (level 1). The shares were obtained as compensation for performing consulting services. An unrealized loss of $434 and a $702 unrealized gain are included in the Company Statements of Operations for the periods ended December 31, 2016. An unrealized loss of $3,838, and a $480 unrealized gain are included in the Company Statements of Operations for the periods ended December 31, 2015. |
NOTE 9 - RELATED PARTY TRANSACT
NOTE 9 - RELATED PARTY TRANSACTIONS | 12 Months Ended |
Dec. 31, 2016 | |
Related Party Transactions [Abstract] | |
NOTE 9 - RELATED PARTY TRANSACTIONS | NOTE 9 - RELATED PARTY TRANSACTIONS The Company was formed on January 25, 2011 as a wholly-owned subsidiary of Worlds Inc. (formerly known as Worlds.com Inc.). On May 16, 2011 Worlds Inc. transferred to the Company the majority of its operations and related operational assets, except for its patent portfolio. Worlds Inc. has also given to the Company a perpetual world-wide license to its patented technology. Pursuant to the license, the Company has the right to issue unlimited sublicenses to the licensed technology, subject to World Inc.’s reasonable consent. The assets transferred to the Company include: Worlds Inc.’s technology platform, Worlds Ultimate Chat, Aerosmith World, DMC Worlds, Cinema Virtual, Pearson contracts and related revenue, the following URLs: Worlds.com, Cybersexworld.com, Hang.com, and Worldsfunds.com, a digital inventory of over 10,000 3D objects, animation sequences, an extensive avatar library, texture maps and virtual world architectures. None of the transferred assets have any carrying value on the financial statements of the Company. Deferred revenue of $226,950 at December 31, 2016 and December 31, 2015 was transferred from Worlds, Inc. The due from related party balance for 2016 is $136,394 and is comprised of cash payments made by us to subsidiaries and Sigal Holdings related to the transfer of all balances in the acquisition of Sigal Consulting LLC. The due from related party balance as of December 31, 2015 is $104,494. The due to related parties for 2015 is comprised of cash received from related parties to pay for operating expenses and include advances made by a Director of Worlds Online Inc. The balance at December 31, 2016 is $148,337 and as of December 31, 2015 the balance was $125,902. |
NOTE 10 - COMMITMENTS AND CONTI
NOTE 10 - COMMITMENTS AND CONTINGENCIES | 12 Months Ended |
Dec. 31, 2016 | |
Commitments and Contingencies Disclosure [Abstract] | |
NOTE 10 - COMMITMENTS AND CONTINGENCIES | NOTE 10 - COMMITMENTS AND CONTINGENCIES The Company is committed to an employment agreement with its President and CEO, Thom Kidrin. The agreement, dated as of August 30, 2012, is for five years with a one-year renewal option held by Mr. Kidrin. The agreement provides for a base salary of $175,000, which increases 10% on September 1 of each year; a monthly car allowance of $500; an annual bonus equal to 2.5% of Pre-Tax Income (as defined in the agreement); an additional bonus as follows: $75,000, if Pre-Tax Income for the year is between 150% and 200% of the prior fiscal year’s Pre-Tax Income or (B) $100,000, if Pre-Tax Income for the year is between 201% and 250% of the prior fiscal year’s Pre-Tax Income or (C) $200,000, if Pre-Tax Income for the year is 251% or greater than the prior fiscal year’s Pre-Tax Income, but in no event shall this additional bonus exceed five (5%) percent of Pre-Tax Income for such year; payment of up to $10,000 in life insurance premiums; options to purchase 4.5 million shares of Worlds Inc. common stock at an exercise price of $0.01 per share, of which one-third vested on August 30, 2012, one-third vest on August 30, 2013 and the balance vested on August 30, 2014; a death benefit of at least $2 million dollars; and a payment equal to 2.99 times his base amount (as defined in the agreement) in the event of a Change of Control (as defined in the agreement). The agreement also provides that Mr. Kidrin can be terminated for cause (as defined in the agreement) and that he is subject to restrictive covenants for 12 months after termination. The balance due Mr. Kidrin at December 31, 2016 and December 31, 2015 is $839,955 and $599,265 respectively, and are included in accrued expenses. |
NOTE 11- NON-CONTROLLING INTERE
NOTE 11- NON-CONTROLLING INTEREST | 12 Months Ended |
Dec. 31, 2016 | |
Equity [Abstract] | |
NOTE 11-NON-CONTROLLING INTEREST | NOTE 11 - NON-CONTROLLING INTEREST Effective September 29, 2014, in connection with the acquisition of Sigal Consulting LLC., the Company’s percentage of ownership in MariMed Advisors, Inc., its subsidiary, decreased from 100% to 51%. The acquisition resulted in an allocation of ownership interest valued at $(41,159) to the non-controlling shareholders. During December 31, 2016 year ended, $520,017 net income attributed to non-controlling interest. On December 31, 2016 the non-controlling interest is $557,006. During December 31, 2015 year ended, $(631,569) net loss attributed to non-controlling interest. On December 31, 2015 the non-controlling interest is $54,109. |
NOTE 12 - SEGMENT REPORTING
NOTE 12 - SEGMENT REPORTING | 12 Months Ended |
Dec. 31, 2016 | |
Segment Reporting [Abstract] | |
NOTE 12 - SEGMENT REPORTING | NOTE 12– SEGMENT REPORTING: The Company follows paragraph 280 of the FASB Accounting Standards Codification for disclosures about segment reporting. This statement requires companies to report information about operating segments in interim and annual financial statements. It also requires segment disclosures about products and services, geographic areas, and major customers. The Company has two reportable operating segments as determined by management using the “management approach” as defined by the authoritative guidance on Disclosures about Segments of an Enterprise and Related Information Summarized in the following tables are net sales and operating revenues, depreciation and amortization expense, income from continuing operations before taxes, capital expenditures and assets for the Company's reportable segments as of and for the fiscal years ended December 31, 2016 and December 31, 2015: Fiscal Year Ended December 31, December 31, 2016 2015 Revenues: Worlds Online $ 618 $ 798 MariMed 3,563,502 1,326,003 Consolidated revenues $ 3,564,120 $ 1,270,176 Depreciation and amortization: Worlds Online $ — $ — MariMed 265,746 1,206,003 Depreciation and amortization $ 265,746 $ 1,206,003 Income/(Loss) before taxes Worlds Online $ (589,823 ) $ (600,378 ) MariMed 910,988 (1,246,525 ) Income/(Loss) before taxes $ 321,165 $ (1,846,903 ) Capital Expenditures: Worlds Online $ — $ — MariMed 3,364,070 3,048,776 Combined capital expenditures $ 3,364,070 $ 3,048,776 Assets: Worlds Online $ 709 $ 40,935 MariMed 8,562,392 3,676,798 Combined assets $ 8,563,101 $ 3,717,733 |
NOTE 13 - MATERIAL TRANSACTION
NOTE 13 - MATERIAL TRANSACTION | 12 Months Ended |
Dec. 31, 2016 | |
Notes to Financial Statements | |
NOTE 13 - MATERIAL TRANSACTION | NOTE 13 – MATERIAL TRANSACTIONS Mia Development LLC (“Mia”) entered into a long term lease with First State Compassion Center. Mia Development LLC (“Mia”) entered into a long term lease with First State Compassion Center. Mia purchased the building in 2016. The tenant secured the license in the State of Delaware and is paying rent as per lease agreement. In January of 2015, First State Compassion Center Inc. issued a promissory note to Mia in the amount of $1,100,000. The note carries a 12.5% interest rate and is due on December 31, 2019. During 2015, the note act as a revolving credit line. Whatever the outstanding balance is eight months from the date of execution shall be fixed as the amount due and payable of the note, not to exceed $1,100,000. The balance of the note on December 31, 2016 is $664,297. During the year ended December 31, 2016 Mia issued shares of Class A units for $206,157. During the year ended December 31, 2015 Mia issued shares of Class A units for $1,500,469. As part of the operating agreement, the Class A members will receive seventy percent of the operating cash flow until they receive 100% of their investment back. Mari Holdings IL LLC, (Mari”) a wholly owned subsidiary of Marimed has purchased land and developed buildings to lease to KPG of Anna LLC and KPG of Harrisburg LLC, two companies that have been awarded dispensary licenses for medical cannabis in the state of Illinois. Mari has entered into an operating agreement with KPG of Anna LLC and KPG Harrisburg LLC to manage and run the dispensaries. |
NOTE 14 - NOTES PAYABLE
NOTE 14 - NOTES PAYABLE | 12 Months Ended |
Dec. 31, 2016 | |
Notes to Financial Statements | |
NOTE 14 - NOTES PAYABLE | NOTE 14 – NOTES PAYABLE During the year ended December 31, 2016, Marimed borrowed $950,000 via promissory notes and repaid $175,000 in promissory notes. The Company converted two notes payables plus accrued interest into Class A units in Mia Development. The outstanding notes carry an interest rate of between 10% and 12%. All but one of the remaining notes have reached maturity but are still outstanding and being paid interest. |
NOTE 15 - SUBSEQUENT EVENT
NOTE 15 - SUBSEQUENT EVENT | 12 Months Ended |
Dec. 31, 2016 | |
Subsequent Events [Abstract] | |
NOTE 15 - SUBSEQUENT EVENT | NOTE 15 - SUBSEQUENT EVENTS The Company raised $1,600,000 in March by issuing 7,978,888 shares of common stock to accredited investors at a price per share between $0.18 per share and $0.25 per share. The Company also voted to approve authorizing up to 500 million shares of common stock and 50 million shares of preferred stock. |
NOTE 1 - DESCRIPTION OF BUSIN22
NOTE 1 - DESCRIPTION OF BUSINESS & SUMMARY OF ACCTING POLICIES (Policies) | 12 Months Ended |
Dec. 31, 2016 | |
Notes to Financial Statements | |
Description of Business | Description of Business We currently operate in two separate segments with one segment being a 3D entertainment portal which leverages its proprietary licensed technology to offer visitors a network of virtual, multi-user environments which we call "worlds" and the second segment being a management company in the medical cannabis industry. We were formed on January 25, 2011 as a wholly-owned subsidiary of Worlds Inc. (formerly known as Worlds.com Inc.). Effective May 16, The assets transferred to us include: Worlds Inc.s technology platform, Worlds Chat, Aerosmith World, DMC Worlds, Cinema Virtual, Pearson contracts and related revenue, the following URLs: Worlds.com, Cybersexworld.com, Hang.com, and Worldsfunds.com, a digital inventory of over 10,000 3D objects, animation sequences, an extensive avatar library, texture maps and virtual world architectures. The transfer On May 19, 2014, Worlds Online Inc. (the Company) entered into a Membership Interest Purchase Agreement (the Agreement) between MariMed Advisors Inc. (MariMed), a wholly owned subsidiary of the Company, Sigal Consulting LLC (Sigal), a Massachusetts limited liability company, and the Members of Sigal (Sellers). The transaction closed on September 29, 2014. Pursuant to the Agreement, the Company, through MariMed, acquired all of the assets of Sigal and the Sellers received the aggregate amount of (i) the Companys common stock (WORX) equal to 50% of the Companys outstanding common stock on the Closing Date; (ii) three million options to purchase shares of the Companys common stock which are exercisable over five years with various exercise prices ranging from $0.15 to $0.35 and (iii) 49% of MariMeds outstanding common stock. As a result, the Companys ownership of MariMed was reduced from 100% to 51%. The transaction was accounted for as a purchase acquisition/merger wherein the Company is both accounting acquirer and legal acquirer. Accordingly, the company recorded the assets purchased and liabilities assumed as part of the merger and the portion that the fair value . |
Basis of Presentation | Basis of Presentation The accompanying financial our ability to grow our business |
Use of Estimates | Use of Estimates The preparation of financial statements in conformity with US GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosures of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from these estimates. |
Trading Securities | Trading Securities Trading securities are common stock in publicly traded companies, one that was received as compensation for performing consulting services. The other was purchased as an investment. The carrying value of the investments is the market price of the shares at December 31, 2016 and December 31, 2015. Any unrealized gain or loss are recorded under other income/(expense) in the accompanying statements of operations. |
Cash and Cash Equivalents | Cash and Cash Equivalents Cash and cash equivalents are comprised of highly liquid money market instruments, which have original maturities of three months or less at the time of purchase. |
Revenue Recognition | Revenue Recognition The Company has the following source of revenue: VIP subscriptions to our Worlds Ultimate 3-D Chat service and consulting and other revenues from MariMed. The Company recognizes revenue when all of the following criteria are met: evidence of an arrangement exists such as a signed contract, delivery has occurred, the price is fixed or determinable, and collectability is reasonable assured. This will usually be in the form of a receipt of a customers acceptance indicating the product has been completed to their satisfaction except for development work and service revenue which is recognized when the services have been performed. Deferred revenue represents cash payments received in advance to be recorded as revenue when earned. The corresponding cost associated with those contracts is also deferred as deferred costs until the revenue is ultimately recognized. |
Research and Development Costs | Research and Development Costs Research and development costs will be charged to operations as incurred. |
Intangible Asset - Websites | Intangible Asset - Websites The Company purchased several medical marijuana related websites in 2014. The websites cost were being amortized using the straight line method over a period of five years. It was determined that the websites were not generating a deal flow for us and was not generating any expected future economic benefit so the balance was written off at the end of 2015. |
Property and Equipment | Property and Equipment Property and equipment will be stated at cost. Depreciation will be provided on a straight line basis over the estimated useful lives of the assets ranging from three to five years. When assets are retired or disposed of, the cost and accumulated depreciation are removed from the accounts, and any resulting gains or losses are included in income. Maintenance and repairs will be charged to expense in the period incurred. |
Impairment of Long Lived Assets | Impairment of Long Lived Assets The Company evaluates the recoverability of its fixed assets and other assets in accordance with section 360-10-15 of the FASB Accounting Standards Codification (“ASC”) for disclosures about Impairment or Disposal of Long-Lived Assets. Disclosure requires recognition of impairment of long-lived assets in the event the net book value of such assets exceeds its expected cash flows. If so, it is considered to be impaired and is written down to fair value, which is determined based on either discounted future cash flows or appraised values. |
Fair Value of Financial Instruments | Fair Value of Financial Instruments The Company follows paragraph 825-10-50-10 of the FASB ASC for disclosures about fair value of its financial instruments and paragraph 820-10-35-37 of the FASB ASC (“Paragraph 820-10-35-37”) to measure the fair value of its financial instruments. Paragraph 820-10-35-37 establishes a framework for measuring fair value in US GAAP, and expands disclosures about fair value measurements. To increase consistency and comparability in fair value measurements and related disclosures, Paragraph 820-10-35-37 establishes a fair value hierarchy which prioritizes the inputs to valuation techniques used to measure fair value into three broad levels. The fair value hierarchy gives the highest priority to quoted prices (unadjusted) in active markets for identical assets or liabilities and the lowest priority to unobservable inputs. The three levels of fair value hierarchy defined by Paragraph 820-10-35-37 are described below: Level 1 Quoted market prices available in active markets for identical assets or liabilities as of the reporting date. Level 2 Pricing inputs other than quoted prices in active markets included in Level 1, which are either directly or indirectly observable as of the reporting date. Level 3 Pricing inputs that are generally observable inputs and not corroborated by market data. The carrying amounts of the Company’s financial assets and liabilities, such as cash and accounts payable approximate their fair values because of the short maturity of these instruments. |
Accounts Payable Related Party | Accounts Payable Related Party Accounts payable related party is comprised of cash payments made by Worlds Inc. on our behalf for shared operating expenses. |
Deferred Revenue | Deferred Revenue Deferred revenue represents advance payments for the license, the design and development of the software, content and related technology for the creation of an interactive, 3D entertainment portal on the internet. |
Extinguishment of liabilities | Extinguishment of liabilities The Company accounts for extinguishment of liabilities in accordance with the guidance set forth in section 405-20 of the FASB ASC 405-20. Extinguishments of Liabilities |
Stock-Based Compensation | Stock-Based Compensation The Company accounts for stock-based compensation using the fair value method following the guidance set forth in section 718-10 of the FASB ASC for disclosure about Stock-Based Compensation. This section requires a public entity to measure the cost of employee services received in exchange for an award of equity instruments based on the grant-date fair value of the award (with limited exceptions). That cost will be recognized over the period during which an employee is required to provide service in exchange for the award- the requisite service period (usually the vesting period). No compensation cost is recognized for equity instruments for which employees do not render the requisite service. |
Real estate escrow | Real estate tax escrow Real estate tax escrow consists of funds held for the purpose of real estate taxes owed. These funds will be released as required to satisfy tax payments as due. |
Rental properties | Rental properties Rental properties are carried at cost less accumulated depreciation and amortization. Betterments, major renovations and certain costs directly related to the improvement of rental properties are capitalized. Maintenance and repair expenses are charged to expense as incurred. Depreciation is recognized on a straight-line basis over estimated useful lives of the assets, which range from 7 to 39 years. Tenant improvements are amortized on a straight-line basis over the lives of the related leases, which approximate the useful lives of the assets. Upon the acquisition of real estate, the Company assesses the fair value of acquired assets (including land, buildings and improvements, identified intangibles, such as acquired above-market leases and acquired in-place leases) and acquired liabilities (such as acquired below-market leases) and allocate the purchase price based on these assessments. The Company assesses fair value based on estimated cash flow projections that utilize appropriate discount and capitalization rates and available market information. Estimates of future cash flows are based on a number of factors including historical operating results, known trends, and market/economic conditions. The Company’s rental properties are individually reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. An impairment exists when the carrying amount of an asset exceeds the aggregate projected future cash flows over the anticipated holding period on an undiscounted basis. An impairment loss is measured based on the excess of the property’s carrying amount over its estimated fair value. Impairment analyses are based on our current plans, intended holding periods and available market information at the time the analyses are prepared. If the Company’s estimates of the projected future cash flows, anticipated holding periods, or market conditions change, the Company’s evaluation of impairment losses may be different and such differences could be material to its consolidated financial statements. The evaluation of anticipated cash flows is subjective and is based, in part, on assumptions regarding future occupancy, rental rates and capital requirements that could differ materially from actual results. For the years ended December 31, 2016 and 2015, the Company did not record any impairment losses. The Company has capitalized land, which is not subject to depreciation. |
Income Taxes | Income Taxes The Company accounts for income taxes under Section 740-10-30 of the FASB ASC (“ASC 740”). Deferred income tax assets and liabilities are determined based upon differences between the financial reporting and tax basis of assets and liabilities and are measured using the enacted tax rates and laws that will be in effect when the differences are expected to reverse. Deferred tax assets are reduced by a valuation allowance to the extent management concludes it is more likely than not that the assets will not be realized. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in the consolidated statements of operations in the period that includes the enactment date. ASC 740 prescribes a comprehensive model for how companies should recognize, measure, present, and disclose in their financial statements uncertain tax positions taken or expected to be taken on a tax return. Under ASC 740, tax positions must initially be recognized in the financial statements when it is more likely than not the position will be sustained upon examination by the tax authorities. Such tax positions must initially and subsequently be measured as the largest amount of tax benefit that has a greater than 50% likelihood of being realized upon ultimate settlement with the tax authority assuming full knowledge of the position and relevant facts. |
Related Party Transactions | Related Party Transactions The Company follows subtopic 850-10 of the FASB ASC for the identification of related parties and disclosure of related party transactions. Pursuant to Section 850-10-20 the Related parties include a. affiliates of the Company; b. Entities for which investments in their equity securities would be required, absent the election of the fair value option under the Fair Value Option Subsection of Section 8251015, to be accounted for by the equity method by the investing entity; c. trusts for the benefit of employees, such as pension and profit-sharing trusts that are managed by or under the trusteeship of management; d. principal owners of the Company; e. management of the Company; f. other parties with which the Company may deal if one party controls or can significantly influence the management or operating policies of the other to an extent that one of the transacting parties might be prevented from fully pursuing its own separate interests; and g. Other parties that can significantly influence the management or operating policies of the transacting parties or that have an ownership interest in one of the transacting parties and can significantly influence the other to an extent that one or more of the transacting parties might be prevented from fully pursuing its own separate interests. The financial statements shall include disclosures of material related party transactions, other than compensation arrangements, expense allowances, |
Comprehensive Income (Loss) | Comprehensive Income (Loss) The Company reports comprehensive income and its components following guidance set forth by section 220-10 of the FASB ASC which establishes standards for the reporting and display of comprehensive income and its components in the consolidated financial statements. There were no items of comprehensive income (loss) applicable to the Company during the period covered in the financial statements. |
Loss Per Share | Loss Per Share Net loss per common share is computed pursuant to section 260-10-45 of the FASB ASC. Basic net loss per share is computed by dividing net loss by the weighted average number of shares of common stock outstanding during the period. Diluted net loss per share is computed by dividing net loss by the weighted average number of shares of common stock and potentially outstanding shares of common stock during each period. As of December 31, 2016, there were 9,250,000 options and 1,185,000 warrants whose effect is anti-dilutive and not included in diluted net loss per share at December 31, 2016. The options and warrants may dilute future earnings per share. |
Commitments and Contingencies | Commitments and Contingencies The Company follows subtopic 450-20 of the FASB ASC to report accounting for contingencies. Certain conditions may exist as of the date the financial statements are issued, which may result in a loss to the Company but which will only be resolved when one or more future events occur or fail to occur. The Company assesses such contingent liabilities, and such assessment inherently involves an exercise of judgment. In assessing loss contingencies related to legal proceedings that are pending against the Company or unasserted claims that may result in such proceedings, the Company evaluates the perceived merits of any legal proceedings or unasserted claims as well as the perceived merits of the amount of relief sought or expected to be sought therein. If the assessment of a contingency indicates that it is probable that a material loss has been incurred and the amount of the liability can be estimated, then the estimated liability would be accrued in the Company’s financial statements. If the assessment indicates that a potentially material loss contingency is not probable but is reasonably possible, or is probable but cannot be estimated, then the nature of the contingent liability, and an estimate of the range of possible losses, if determinable and material, would be disclosed. Loss contingencies considered remote are generally not disclosed unless they involve guarantees, in which case the guarantees would be disclosed. Management does not believe, based upon information available at this time that these matters will have a material adverse effect on the Company’s financial position, results of operations or cash flows. However, there is no assurance that such matters will not materially and adversely affect the Company’s business, financial position, and results of operations or cash flows. |
Risk and Uncertainties | Risk and Uncertainties The Company is subject to risks common to companies in the technology industries, including, but not limited to, litigation, development of new technological innovations and dependence on key personnel. The Company is also subject to risks arising from its medical marijuana related business inasmuch as marijuana is still a federally prohibited substance. |
Off Balance Sheet Arrangements | Off Balance Sheet Arrangements The Company does not have any off-balance sheet arrangements. |
Uncertain Tax Positions | Uncertain Tax Positions The Company did not take any uncertain tax positions and had no adjustments to unrecognized income tax liabilities or benefits pursuant to the provisions of Section 740-10-25 for the years ended December 31, 2016 or 2015. |
Acquisition | Acquisition On September 29, 2014 our wholly-owned subsidiary, MariMed Advisors Inc. ("MariMed"), acquired all of the outstanding assets of Sigal Consulting LLC ("Sigal") from its members, The purchase price consisted of 31,954,236 shares of the Company's common stock, 3 million five-year options to purchase additional shares of our common stock at prices ranging from $0.15 - $0.35 per share and which vest over two years and 49% of MariMed's outstanding equity. The fair value of the common stock issued was $5,911,534 determined by the fair value of the Company’s Common Stock on the closing date, at a price of approximately $0.185 per share. The fair value of the stock options was $569,682 measured using the Black-Scholes valuation model on the grant date, assuming approximately 1.56% risk-free interest, 0% dividend yield, 311% volatility, and expected life of five years. The fair value of common stock issued and options granted for acquisition over the book value of Sigal is recorded as goodwill, which was subsequently impaired in full. Two of the owners of Sigal, Robert Fireman and Jon Levine are directors of the Company. |
Subsequent Events | Subsequent Events The Company evaluated for subsequent events through the issuance date of the Company’s financial statements. The Company raised $1,600,000 in March by issuing 7,978,888 shares of common stock to accredited investors at a price per share between $0.18 per share and $0.25 per share. The Company also voted to approve authorizing up to 500 million shares of common stock and 50 million shares of preferred stock. |
Recent Accounting Pronouncements | Recent Accounting Pronouncements In May 2014, the FASB issued Accounting Standards Update No. 2014-09, “Revenue from Contracts with Customers.” This amendment outlines a single comprehensive model for entities to use in accounting for revenue arising from contracts with customers and supersedes most current revenue recognition guidance, including industry-specific guidance. The core principle of the revenue model is that “an entity recognizes revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services.” The new guidance applies to all contracts with customers except those that are within the scope of other topics in GAAP. This amendment is effective for annual reporting periods, including interim reporting periods within those periods, beginning after December 15, 2016, and is not expected to have a material impact on the Company’s unaudited interim Consolidated Financial Statements. The Company has reviewed all recently issued, but not yet effective, accounting pronouncements up to ASU 2015-16, and does not believe the future adoption of any such pronouncements may be expected to cause a material impact on its financial condition or the results of its operations. |
NOTE 6 - STOCK OPTIONS (Tables)
NOTE 6 - STOCK OPTIONS (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |
Stock Warrants and Options | Stock options outstanding and exercisable as of December 31, 2016 are as follows: Exercise Price per Share Shares Under Option Remaining Life in Years Outstanding $ 0.08 450,000 2.00 $ 0.025 200,000 1.00 $ 0.025 500,000 0.97 $ 0.01 4,500,000 0.67 $ 0.13 600,000 3.50 $ 0.15 1,000,000 2.39 $ 0.25 1,000,000 2.39 $ 0.35 1,000,000 2.39 9,250,000 Exercisable $ 0.08 450,000 2.00 $ 0.025 200,000 1.00 $ 0.025 500,000 0.97 $ 0.01 4,500,000 0.67 $ 0.13 600,000 3.50 $ 0.15 1,000,000 2.39 $ 0.25 1,000,000 2.39 8,250,000 |
NOTE 7 - INCOME TAXES (Tables)
NOTE 7 - INCOME TAXES (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Income Tax Disclosure [Abstract] | |
Company's total deferred tax | Deferred tax asset gross $ 1,403,000 Valuation allowance (1,403,000 ) Net deferred tax asset $ |
Reconciliation of income taxes | 2016 2015 Income tax computed at the federal statutory rate 34 % 34 % Income tax computed at the state statutory rate 5 % 5 % Valuation allowance (39 %) (39 %) Total deferred tax asset 0 % 0 % |
NOTE 8 - TRADING SECURITIES (Ta
NOTE 8 - TRADING SECURITIES (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Marketable Securities [Abstract] | |
Marketable equity securities | Marketable equity securities Cost Market value Unrealized Gain/(Loss) Paid, Inc. $ 13,200 $ 638 $ (12,561 ) Global Links Corp. $ 381 $ 0 $ (381 ) |
NOTE 14 - SEGMENT REPORTING (Ta
NOTE 14 - SEGMENT REPORTING (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Notes to Financial Statements | |
Operating segments | Fiscal Year Ended December 31, December 31, 2016 2015 Revenues: Worlds Online $ 618 $ 798 MariMed 3,563,502 1,326,003 Consolidated revenues $ 3,564,120 $ 1,270,176 Depreciation and amortization: Worlds Online $ — $ — MariMed 265,746 1,206,,003 Depreciation and amortization $ 265,746 $ 1,206,003 Income/(Loss) before taxes Worlds Online $ (589,823 ) $ (600,378 ) MariMed 910,988 (1,246,525 ) Income/(Loss) before taxes $ 321,165 $ (1,846,903 ) Capital Expenditures: Worlds Online $ — $ — MariMed 3,364,070 3,048,776 Combined capital expenditures $ 3,364,070 $ 3,048,776 Assets: Worlds Online $ 709 $ 40,935 MariMed 8,562,392 3,676,798 Combined assets $ 8,563,101 $ 3,717,733 |
NOTE 6 - STOCK OPTIONS - Stock
NOTE 6 - STOCK OPTIONS - Stock option table (Details) | Dec. 31, 2016yr$ / sharesshares |
Outstanding (1) | |
Shares under options | shares | 450,000 |
Price per shares | $ / shares | $ 0.08 |
Remaining life in years | yr | 2 |
Outstanding (2) | |
Shares under options | shares | 200,000 |
Price per shares | $ / shares | $ 0.025 |
Remaining life in years | yr | 1 |
Outstanding (3) | |
Shares under options | shares | 500,000 |
Price per shares | $ / shares | $ 0.025 |
Remaining life in years | yr | 0.97 |
Outstanding (4) | |
Shares under options | shares | 4,500,000 |
Price per shares | $ / shares | $ 0.01 |
Remaining life in years | yr | 0.67 |
Outstanding (5) | |
Shares under options | shares | 600,000 |
Price per shares | $ / shares | $ 0.13 |
Remaining life in years | yr | 3.50 |
Outstanding (6) | |
Shares under options | shares | 1,000,000 |
Price per shares | $ / shares | $ 0.15 |
Remaining life in years | yr | 2.39 |
Outstanding (7) | |
Shares under options | shares | 1,000,000 |
Price per shares | $ / shares | $ 0.25 |
Remaining life in years | yr | 2.39 |
Outstanding (8) | |
Shares under options | shares | 1,000,000 |
Price per shares | $ / shares | $ 0.35 |
Remaining life in years | yr | 2.39 |
Exercisable (1) | |
Shares under options | shares | 450,000 |
Price per shares | $ / shares | $ 0.08 |
Remaining life in years | yr | 2 |
Exercisable (2) | |
Shares under options | shares | 200,000 |
Price per shares | $ / shares | $ 0.025 |
Remaining life in years | yr | 1 |
Exercisable (3) | |
Shares under options | shares | 500,000 |
Price per shares | $ / shares | $ 0.025 |
Remaining life in years | yr | 0.97 |
Exercisable (4) | |
Shares under options | shares | 4,500,000 |
Price per shares | $ / shares | $ 0.01 |
Remaining life in years | yr | 0.67 |
Exercisable (5) | |
Shares under options | shares | 600,000 |
Price per shares | $ / shares | $ 0.13 |
Remaining life in years | yr | 3.50 |
Exercisable (6) | |
Shares under options | shares | 1,000,000 |
Price per shares | $ / shares | $ 0.15 |
Remaining life in years | yr | 2.39 |
Exercisable (7) | |
Shares under options | shares | 1,000,000 |
Price per shares | $ / shares | $ 0.25 |
Remaining life in years | yr | 2.39 |
NOTE 7 - INCOME TAXES - Company
NOTE 7 - INCOME TAXES - Company's total deferred tax (Details) | 12 Months Ended |
Dec. 31, 2016USD ($) | |
Income Tax Disclosure [Abstract] | |
Net operating loss | $ 1,403,000 |
Valuation allowance | (1,403,000) |
Net deferred tax asset |
NOTE 7 - INCOME TAXES - Reconci
NOTE 7 - INCOME TAXES - Reconciliation of income taxes (Details) - USD ($) | 12 Months Ended | |
Dec. 31, 2016 | Dec. 31, 2015 | |
Income Tax Disclosure [Abstract] | ||
Income tax computed at the federal statutory rate | 34.00% | 34.00% |
Income tax computed at the state statutory rate | 5.00% | 5.00% |
Valuation allowance | (0.39) | (0.39) |
Total deferred tax asset | $ 0 | $ 0 |
NOTE 8 - TRADING SECURITIES (De
NOTE 8 - TRADING SECURITIES (Details) | 12 Months Ended |
Dec. 31, 2016USD ($) | |
Marketable Securities [Abstract] | |
Marketable equity securities - Cost, Paid, Inc. | $ 13,200 |
Marketable equity securities - Cost, Global Links Corp. | 381 |
Market value - Paid, Inc. | 638 |
Market value - Global Links Corp. | 0 |
Unrialized Gain/(Loss), Paid, Inc. | (12,561) |
Unrialized Gain/(Loss), Global Links Corp. | $ (381) |
NOTE 12 - SEGMENT REPORTING (De
NOTE 12 - SEGMENT REPORTING (Details) - USD ($) | 12 Months Ended | |
Dec. 31, 2016 | Dec. 31, 2015 | |
Revenues | $ 3,564,120 | $ 1,270,176 |
Worlds Online | ||
Revenues | 618 | 798 |
Depreciation and amortization | ||
Loss before taxes | (589,823) | (600,378) |
Capital expenditures | ||
Assets | 709 | 40,935 |
MariMed | ||
Revenues | 3,563,502 | 1,326,003 |
Depreciation and amortization | 265,746 | 1,206,003 |
Loss before taxes | 910,988 | (1,246,525) |
Capital expenditures | 3,364,070 | 3,048,776 |
Assets | $ 8,562,392 | $ 3,676,798 |
NOTE 3 - EQUITY (Details Narrat
NOTE 3 - EQUITY (Details Narrative) - USD ($) | 12 Months Ended | |
Dec. 31, 2016 | Dec. 31, 2015 | |
Stockholders' Equity Note [Abstract] | ||
Acquisition shares issued | 31,954,237 | |
Preferred shares issued | 300,000 | |
Warrants issued to investors | 1,070,000 | |
Warrants issued to investors | 60,000 | 55,000 |
Aggregated shares issued | 166,210 | |
Common stock issued for accrued expenses | ||
Company issued options to Directors | 300,000 | |
Additional options issued to officer | 300,000 |
NOTE 4 - DEFERRED REVENUE (Deta
NOTE 4 - DEFERRED REVENUE (Details Narrative) - USD ($) | Dec. 31, 2016 | Dec. 31, 2015 |
Deferred Revenue Disclosure [Abstract] | ||
Deferred Revenue | $ 226,950 | $ 226,950 |
NOTE 5 - PROPERTY AND EQUIPME34
NOTE 5 - PROPERTY AND EQUIPMENT (Details Narrative) - USD ($) | 12 Months Ended | |
Dec. 31, 2016 | Dec. 31, 2015 | |
Notes to Financial Statements | ||
Rental properties | $ 6,186,725 | $ 2,837,511 |
Rental equipment | 228,523 | 182,561 |
Property and equipment | 5,279,060 | |
Depreciation expense | $ 265,746 | $ 839,336 |
NOTE 6 - STOCK OPTIONS (Details
NOTE 6 - STOCK OPTIONS (Details Narrative) - USD ($) | 12 Months Ended | |
Dec. 31, 2016 | Dec. 31, 2015 | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | ||
Equity compensation expense | $ 163,574 | $ 45,946 |
Risk-free interest - option and warrants | 41.00% | 163.00% |
Volatily | 26.50% | 17.50% |
Warrants issued | 1,130,000 | 55,000 |
Warrants expense | $ 7,036 | |
Volatily | 27.10% |
NOTE 7 - INCOME TAXES (Details
NOTE 7 - INCOME TAXES (Details Narrative) - USD ($) | 12 Months Ended | |
Dec. 31, 2016 | Dec. 31, 2015 | |
Net operating loss carry forward | $ 3,020,372 | |
Deferred tax asset consist of a net operating loss calculated using federal and state effective tax rates equating to | 1,403,000 | |
Valuation allowance increase | $ 77,552 | $ 293,232 |
NOTE 8 - TRADING SECURITIES (37
NOTE 8 - TRADING SECURITIES (Details Narrative) - USD ($) | 12 Months Ended | |
Dec. 31, 2016 | Dec. 31, 2015 | |
Note 8 - Trading Securities Details Narrative | ||
Unrealized loss | $ 434 | $ 3,838 |
Unrealized gain | $ 702 | $ 480 |
NOTE 9 - RELATED PARTY TRANSA38
NOTE 9 - RELATED PARTY TRANSACTIONS (Details Narrative) - USD ($) | Dec. 31, 2016 | Dec. 31, 2015 |
Related Party Transactions [Abstract] | ||
Deferred revenue | $ 226,950 | $ 226,950 |
Due from related parties | 136,394 | 104,494 |
Due to related parties | $ 148,337 | $ 125,902 |
NOTE 10 - COMMITMENTS AND CON39
NOTE 10 - COMMITMENTS AND CONTINGENCIES (Details Narrative) | Dec. 31, 2016USD ($) | Dec. 31, 2015USD ($) | Aug. 30, 2012USD ($)$ / sharesshares |
Commitments and Contingencies Disclosure [Abstract] | |||
Base salary - president | $ 175,000 | ||
Annual increase rate | 0.10 | ||
Car allowance per month | $ 500 | ||
Anual bonus rate | 25.00% | ||
Additional bonus 1 | $ 75,000 | ||
Minimum Pre-Tax income increase rate | 15000.00% | ||
Maximum Pre-Tax income increase rate | 200 | ||
Additional bonus 2 | $ 100,000 | ||
Pre-Tax income increase rate - minimum | 201.00% | ||
Pre-Tax income increase rate - maximum | 250.00% | ||
Additional bonus 3 | $ 200,000 | ||
Pre-Tax income increase rate - minimum | 251.00% | ||
Additional bonus to pre-tax income - maximum | 5.00% | ||
Life insurance premiums | $ 10,000 | ||
Options granted | shares | 4,500,000 | ||
Options exercise price | $ / shares | $ 0.01 | ||
Death benefit | $ 2,000,000 | ||
Times of base amount upon change of control | 2.99 | ||
Salary balance due and included accrued expenses | $ 839,955 | $ 599,265 |
NOTE 11 - NON-CONTROLLING INTER
NOTE 11 - NON-CONTROLLING INTEREST (Details Narrative) | 12 Months Ended | ||
Dec. 31, 2016USD ($) | Dec. 31, 2015USD ($) | Sep. 29, 2014USD ($) | |
Equity [Abstract] | |||
Percentage of ownership in MariMed Advisors, Inc.I | 0.100 | ||
Percentage of ownership in MariMed Advisors, Inc. II | 0.051 | ||
Allocation of ownership interest value | $ (41,159) | ||
Net loss - non-controlling interest | $ 520,017 | $ (631,569) | |
Interest Non-controlling | $ 557,017 | $ 54,109 |
NOTE 13 - MATERIAL TRANSACTION
NOTE 13 - MATERIAL TRANSACTION (Detail Narrative) | Dec. 31, 2016USD ($) | Dec. 31, 2015USD ($) | Jan. 02, 2015USD ($) |
Note 13 - Material Transaction Detail Narrative | |||
Promisory Note - First State Compassion Center, Inc. | $ 1,100,000 | ||
Interest Rate | 12.5 | ||
Note balance | $ 664,297 | ||
Mia Class A shares issued | $ 206,157 | $ 1,500,469 |
NOTE 14 - NOTES PAYABLE (Detail
NOTE 14 - NOTES PAYABLE (Details Narrative) | 12 Months Ended |
Dec. 31, 2016USD ($) | |
Notes to Financial Statements | |
Promissory notes | $ 950,000 |
Repayment of note | $ 175,000 |
Interest rate | 10.00% |
NOTE 15 - SUBSEQUENT EVENT (Det
NOTE 15 - SUBSEQUENT EVENT (Details Narrative) | Mar. 02, 2017USD ($)shares |
Subsequent Events [Abstract] | |
Company raised cash | $ | $ 1,600,000 |
Shares issued | shares | 7,978,888 |