Document_and_Entity_Informatio
Document and Entity Information (USD $) | 9 Months Ended | |
Sep. 30, 2014 | Jun. 30, 2014 | |
Document and Entity Information: | ||
Entity Registrant Name | Pazoo, Inc. | |
Document Type | S-1 | |
Document Period End Date | 30-Sep-14 | |
Amendment Flag | TRUE | |
Entity Central Index Key | 1533427 | |
Current Fiscal Year End Date | -19 | |
Entity Common Stock, Shares Outstanding | 107,765,750 | |
Entity Public Float | $1,077,657 | |
Entity Filer Category | Smaller Reporting Company | |
Entity Current Reporting Status | Yes | |
Entity Voluntary Filers | No | |
Entity Well-known Seasoned Issuer | No | |
Document Fiscal Year Focus | 2014 | |
Document Fiscal Period Focus | FY | |
Amendment Description | Amendment 1 |
BALANCE_SHEETS_Unaudited_for_S
BALANCE SHEETS (Unaudited for September 30, 2014) (USD $) | Sep. 30, 2014 | Dec. 31, 2013 | ||
Current assets: | ||||
Cash and cash equivalents | $95,402 | $35,848 | ||
Accounts receivable | 59,964 | 33,461 | ||
Inventories | 2,668 | 4,129 | ||
Interest | 279,180 | [1] | 0 | [1] |
Prepaid expenses | 1,465 | 1,911 | ||
Total current assets | 438,679 | 75,349 | ||
Total assets | 438,679 | 75,349 | ||
Current liabilities: | ||||
Accounts payable and accrued liabilities | 68,932 | 64,846 | ||
Loans payable | 3,000 | 3,000 | ||
Convertible debt | 554,782 | [2] | 1,849 | [2] |
Derivative liability | 1,302,003 | 172,049 | ||
Total current liabilities | 1,928,717 | 241,744 | ||
Total liabilities | 1,928,717 | 241,744 | ||
Stockholders' deficit | ||||
Common stock | 153,316 | 101,410 | ||
Convertible preferred stock Series A | 1,134 | 923 | ||
Preferred stock Series B | 1,187 | 1,187 | ||
Additional paid-in capital | 3,346,983 | 2,250,451 | ||
Accumulated deficit | -4,992,658 | -2,520,366 | ||
Total stockholders' deficit | -1,490,038 | -166,395 | ||
Total liabilities and stockholders' equity (deficit) | $438,679 | $75,349 | ||
[1] | In MA Associate. | |||
[2] | Net of discount of $319,973. |
Statement_of_Financial_Positio
Statement of Financial Position - Parenthetical (USD $) | Sep. 30, 2014 | Dec. 31, 2013 |
Common Stock, Par Value | $0.00 | $0.00 |
Common Stock, Shares Authorized | 980,000,000 | 980,000,000 |
Common Stock, Shares Issued | 153,316,670 | 101,409,500 |
Common Stock, Shares Outstanding | 153,316,670 | 101,409,500 |
Warrants Issued | 7,000,000 | 2,400,000 |
Warrants Outstanding | 7,000,000 | 2,400,000 |
Preferred Stock Series A | ||
Preferred Stock, Par Value | $0.00 | $0.00 |
Preferred Stock, Shares Authorized | 10,000,000 | 10,000,000 |
Preferred Stock, Shares Issued | 1,133,894 | 1,133,894 |
Preferred Stock, Shares Outstanding | 923,394 | 923,394 |
Preferred Stock Series B | ||
Preferred Stock, Par Value | $0.00 | $0.00 |
Preferred Stock, Shares Authorized | 2,500,000 | 2,500,000 |
Preferred Stock, Shares Issued | 1,187,500 | 1,187,500 |
Preferred Stock, Shares Outstanding | 1,187,500 | 1,187,500 |
Preferred Stock Series C | ||
Preferred Stock, Par Value | $0.00 | $0.00 |
Preferred Stock, Shares Authorized | 7,500,000 | 7,500,000 |
Preferred Stock, Shares Issued | 0 | 0 |
Preferred Stock, Shares Outstanding | 0 | 0 |
STATEMENTS_OF_OPERATIONS_Unaud
STATEMENTS OF OPERATIONS (Unaudited) (USD $) | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2014 | Sep. 30, 2013 | Sep. 30, 2014 | Sep. 30, 2013 | |
Revenues: | ||||
Advertising sales | $20,892 | $16,052 | $72,059 | $21,517 |
Merchandise sales - revenue | -18 | 867 | 234 | 9,503 |
Total revenues | 20,874 | 16,919 | 72,293 | 31,020 |
Cost of goods sold | ||||
Merchandise sales - cost | 690 | 569 | 8,369 | |
Total cost of goods sold | 690 | 569 | 8,369 | |
Gross profit | 20,874 | 16,229 | 71,724 | 22,651 |
Operating expenses: | ||||
Selling, general and administrative expenses | 414,708 | 110,152 | 1,019,747 | 269,024 |
Professional fees | 361,654 | 24,478 | 533,788 | 83,937 |
Equipment | 961 | |||
Website setup | 53,517 | 19,171 | 110,627 | 46,261 |
Total operating expenses | 829,879 | 153,801 | 1,664,162 | 400,183 |
Loss from operations | -809,005 | -137,572 | -1,592,438 | -377,532 |
Other expenses: | ||||
Gain/loss on derivative liability | -220,447 | -557,747 | ||
Interest expense | -12,000 | -25 | ||
Amortization of debt discount | -226,581 | -310,107 | ||
Net loss | -1,256,033 | -137,572 | -2,472,292 | -377,557 |
Series A preferred stock dividend | -27,134 | -10,209 | -68,755 | |
Net loss attributable to common stockholders | ($1,256,033) | ($164,706) | ($2,482,501) | ($446,312) |
Net loss per common share - basic and diluted | ($0.01) | $0 | ($0.02) | ($0.01) |
Weighted average common shares outstanding - basic and diluted | 121,579,943 | 88,491,647 | 111,979,303 | 81,549,436 |
STATEMENT_OF_CASH_FLOWS_Unaudi
STATEMENT OF CASH FLOWS (Unaudited) (USD $) | 9 Months Ended | |
Sep. 30, 2014 | Sep. 30, 2013 | |
Cash flows from operating activities: | ||
Net loss | ($2,472,292) | ($377,557) |
Common stock issued for services | 649,622 | 72,885 |
Preferred stock issued for services | 34,800 | |
Loss on derivative liability | 557,747 | |
Convertible debt issued for rent expense | 16,601 | |
Amortization of debt discount | 310,107 | |
Accounts receivable (increase/decrease) | -26,503 | 3,326 |
Inventory (increase/decrease) | 1,461 | 2,612 |
Prepaid expenses and other current assets (increase/decrease) | 446 | 771 |
Accounts payable and accrued liabilities (increase/decrease) | 36,739 | 56,467 |
Net cash used in operating activities | -891,272 | -241,496 |
Cash flows from investing activities: | ||
Issuance of preferred stock for cash | 82,500 | |
Borrowings on debt | 33,500 | |
Deposit made on acquisition of investment | -279,180 | |
Net cash used in investing activities | -279,180 | 116,000 |
Cash flows from financing activities: | ||
Borrowings on convertible note | 888,500 | |
Proceeds from sale of common stock | 31,506 | |
Proceeds from exercise of Series A preferred warrants | 40,000 | |
Proceeds from sale of Series A preferred stock | 270,000 | |
Net cash provided by financing activities | 1,230,006 | |
Net increase in cash and cash equivalents | 59,554 | -125,496 |
Cash and cash equivalents beginning of period | 35,848 | 130,556 |
Cash and cash equivalents end of period | $95,402 | $5,060 |
Note_1Description_of_Business_
Note 1-Description of Business and Basis of Presentation | 9 Months Ended |
Sep. 30, 2014 | |
Notes | |
Note 1-Description of Business and Basis of Presentation | Note 1—DESCRIPTION OF BUSINESS AND BASIS OF PRESENTATION |
Basis of Presentation | |
The accompanying unaudited interim financial statements of Pazoo, Inc. (“we”, “our”, “Pazoo” or the “Company”) have been prepared in accordance with accounting principles generally accepted in the United States of America and the rules of the Securities and Exchange Commission, and should be read in conjunction with Pazoo’s audited 2013 annual financial statements and notes thereto filed on Form 10-K with the SEC. In the opinion of management, all adjustments, consisting of normal reoccurring adjustments, necessary for a fair presentation of financial position and the results of operations for the interim periods present have been reflected herein. The results of operation for interim periods are not necessarily indicative of the results to be expected for the full year. Notes to the financial statements, which would substantially duplicate the disclosure required in Pazoo’s fiscal 2013 financial statements have been omitted. | |
Description of Business | |
We are an early growth stage health and wellness company. Presently, our primary business is pazoo.com, an online, content driven, ad supported health and wellness web site for people and their pets. Additionally, this site has e-commerce functionality which allows pazoo.com to be an online retailer of nutritional foods/supplements, wellness goods, and fitness apparel. Pazoo, Inc. does not have any brick and mortar establishments. |
Note_2Going_Concern
Note 2-Going Concern | 9 Months Ended |
Sep. 30, 2014 | |
Notes | |
Note 2-Going Concern | Note 2—GOING CONCERN |
From inception of November 16, 2010 through September 30, 2014, the Company has incurred net losses of $4,992,658. This factor, among others, raises significant doubt about the Company’s ability to continue as a going concern. These financial statements do not include any adjustments relating to the recoverability and classification of assets or the amounts and classification of liabilities that might be necessary should the Company be unable to continue as a going concern. The Company’s continuation as a going concern is dependent upon our ability to generate sufficient cash flow to meet our obligations on a timely basis and ultimately attain profitability. Management believes that we can alleviate the facts and circumstances which indicate a going concern by expanding our services, expert advice and online products. We aim to become more than a web based company by providing information, services and products through direct response, retail, and advertising revenue, in addition to our website. |
Note_3Stockholders_Equity
Note 3-Stockholders' Equity | 9 Months Ended | ||||||||
Sep. 30, 2014 | |||||||||
Notes | |||||||||
Note 3-Stockholders' Equity | Note 3—STOCKHOLDERS’ EQUITY | ||||||||
Common Stock | |||||||||
In September 2014, the Company issued 3,776,389 common shares as per the Equity Purchase Agreement and Securities Purchase Agreement with Premier Venture Partners, LLC valued at $75,527. Premier Ventures also purchased 2,352,845 shares for $31,506 pursuant to put option exercised by the Company. | |||||||||
During the nine months ended September 30, 2014, the Company issued 21,207,412 shares to experts and consultants per agreements for services rendered, valued at $649,622. | |||||||||
Preferred Stock | |||||||||
In April 2014, the Company issued 125,000 shares of Series A Preferred Stock to ICPI in exchange for $125,000. | |||||||||
Simultaneous with the issuance of Series A Preferred Stock in April 2014, and under the Investment Agreement No. 4 we issued 125,000 warrants to ICPI which entitles its owner to purchase one share of Series A Preferred Stock for each Series A Preferred Stock at an exercise price of $2.00, subject to the terms of the warrant agreement between the warrant agent and us. | |||||||||
In March and May 2014, the Company issued 145,000 shares of Series A Preferred Stock to ICPI in exchange for $145,000. The Company also simultaneously issued 145,000 warrants to ICPI which entitles its owner to purchase one share of Series A Preferred Stock for each Series A Preferred Stock acquired at an exercise price of $2.00. | |||||||||
In March 2014, ICPI converted 17,000 Series A Preferred shares into 1,700,000 common shares. In August 2014, ICPI converted 60,000 preferred shares into 6,000,000 common shares. In July 2014, ICPI converted 72,500 preferred shares into 7,250,000 common shares. | |||||||||
In January and February 2014, ICPI exercised 80,000 Series A Preferred shares warrants at $0.50 for $40,000. | |||||||||
In August 2014, the Company issued Jordan Stroum 10,000 Series A Preferred Stock in exchange for services rendered per the agreement signed July 25, 2014. The shares were valued at $34,800. | |||||||||
Warrants | |||||||||
The following table presents the Series A preferred stock warrant activity during the nine months ended September 30, 2014: | |||||||||
Warrants | Weighted Average Exercise Price | ||||||||
Outstanding – December 31, 2013 | 823,226 | $ | 2.2 | ||||||
Granted | 270,000 | 2 | |||||||
Forfeited/Canceled | - | - | |||||||
Exercised | 80,000 | - | |||||||
Outstanding – September 30, 2014 | 1,013,226 | 2.28 | |||||||
Exercisable – September 30, 2014 | 1,013,226 | $ | 2.28 | ||||||
The weighted average remaining life of the outstanding Series A preferred stock warrants as of September 30, 2014 and December 31, 2013 was 3.49 and 3.92 years, respectively. | |||||||||
The following table presents the common stock warrant activity during the nine months ended September 30, 2014: | |||||||||
Warrants | Weighted Average Exercise Price | ||||||||
Outstanding – December 31, 2013 | 5,000,000 | $ | 0.05 | ||||||
Granted | 1,130,470 | 0.05 | |||||||
Forfeited/Canceled | - | - | |||||||
Exercised | - | - | |||||||
Outstanding – September 30, 2014 | 6,130,470 | 0.05 | |||||||
Exercisable – September 30, 2014 | 6,130,470 | $ | 0.05 | ||||||
The weighted average remaining life of the outstanding common stock warrants as of September 30, 2014 and December 31, 2013 was 0.73 and 1.26 years, respectively. |
Note_4Loans_Payable
Note 4-Loans Payable | 9 Months Ended |
Sep. 30, 2014 | |
Notes | |
Note 4-Loans Payable | Note 4—LOANS PAYABLE |
In February 2014, the Company entered into a convertible promissory note totaling $16,601 with ICPI for office lease expenses through February 2015. ICPI may convert all or any part of the outstanding and unpaid principal into shares of Series A Preferred Stock at a price of $0.50 per share. |
Note_5Equity_Interest
Note 5-Equity Interest | 9 Months Ended |
Sep. 30, 2014 | |
Notes | |
Note 5-Equity Interest | Note 5—EQUITY INTEREST |
In April 2014, the Company entered into an agreement to buy a 40% equity interest in MA and Associates, LLC for $2,000,000 and 150,000 shares of the Company’s Series C Preferred Stock. The Company made a $50,000 down payment which was recorded as a deposit in March 2014 and subsequently made a $50,000 investment in April 2014. As of September 30, 2014, a total of $279,180 has been paid to MA and Associates LLC in accordance with the agreement. |
Note_6Convertible_Note_and_Der
Note 6-Convertible Note and Derivative Liabilities | 9 Months Ended | ||||
Sep. 30, 2014 | |||||
Notes | |||||
Note 6-Convertible Note and Derivative Liabilities | Note 6—CONVERTIBLE NOTE AND DERIVATIVE LIABILITIES | ||||
In April 2014, the Company entered into an Equity Purchase Agreement and a Securities Purchase Agreement with Premier Venture Partners, LLC (“Premier”) whereby Premier is obligated, providing the Company has met certain conditions including the filing of a Form S-1 Registration Statement for the shares to be acquired, to purchase up to $5,000,000 of the Company’s common stock at the rates set forth at the request of the Company by issuing a Put Notice when funds are needed. The Securities Purchase Agreement is a facility whereby the Company will receive $22,500 pursuant to two Convertible Promissory Notes. | |||||
In April 2014, the Company entered into a $10,000 Convertible Promissory Note (the “Note”) with Premier Venture Partners, LLC. Under the terms of the Note the Company’s will receive $10,000 for the preparation and filing of the Form S-1 Registration Statement required for the Equity Purchase Agreement (Attached as Exhibit 99.02 to the Company's Form 8-K filed April 9, 2014). Premier Venture Partners, LLC shall have the right to convert any unpaid sums into common stock of the Company at the rate of the lesser of $.03 per share or 50% of the lowest trade reported in the 10 days prior to date of conversion. A second Convertible Promissory Note, in the amount of $12,500, will be issued after the Form S-1 Registration Statement is filed in order to cover any additional expense of making the Form S-1 Registration Statement effective. All of the $22,500 was paid directly to legal for the expense of preparing and making the S-1 Registrations Statement effective. | |||||
In February 2014, the Company entered into a 10% convertible note with Tangiers in the amount of $60,500. Of this amount, $5,500 was an original issue discount on the note. The note is convertible at a variable price of the lower of $0.01 or 50% of the lowest trading price during the 25 day period prior to the date of conversion. The note is convertible 180 days from the date of the note. The note matures on February 27, 2015. In September 2014, the entire balance was converted into 8,066,666 shares of common stock using a conversion price of $0.0075 per share. | |||||
In April 2014, the Company entered into a 12% Convertible Note with JSJ Investments, Inc. (“JSJ”) in the amount of $100,000. Prior to October 28, 2014, the Company may redeem the Note for $150,000. Thereafter, JSJ may convert the Note into common stock of the Company at a stated discount of 50% based on the average of the lowest three trades in the previous ten days, or $0.06 per share. The note matures on October 28, 2014. | |||||
In May 2014, the Company entered into a 10% Convertible Note with Typenex Co Investment LLC (“Typenex”) in the amount of $139,500. Typenex may convert the Note into common stock of the Company at a conversion price of $0.07 per share. The note matures on March 28, 2015. In conjunction with the note, a total of 1,130,470 warrants were issued. The relative fair value of the warrants at September 30, 2014 was $70,867. | |||||
In May 2014, the Company entered into an 8% Convertible Note with LG Capital Funding LLC (“LG”) in the amount of $58,500. LG may convert the Note into common stock of the Company at a stated discount of 50% based average of the lowest trading bid price for the 15 prior trading days. The note is convertible 180 days from the date of the note. | |||||
In June 2014, JMJ Financial converted principal of $10,200 into 500,000 common shares in accordance with the Convertible Promissory Note dated December 4, 2013. | |||||
In July 2014, the Company entered into a $200,000 Convertible Note with WHC Capital LLC. WHC may convert the note into common stock of the Company at a 50% discount to the lowest trading price of 25 trading days prior to the conversion date. The note is convertible 180 days from the date of the note. | |||||
In July 2014, Tangiers provided additional funding to the Company in the amount of $50,000 in accordance with the February 2014 agreement. The note had a $5,500 original issue discount and accrues interest at 10%. | |||||
In July 2014, JMJ Financial converted principal of $12,390 into 700,000 common shares in accordance with the Convertible Promissory Note dated December 4, 2013. | |||||
In August 2014, JMJ Financial converted principal of $11,460 into 1,000,000 common shares in accordance with the Convertible Promissory Note dated December 4, 2013. | |||||
In August 2014, the Company entered into a 12% $100,000 Convertible Note with JSJ Investments. JSJ may convert the Note into common stock of the Company at a 50% discount to the average 3 lowest trading days of 20 trading days prior to conversion OR 20 trading days prior to the date the note was executed. | |||||
In August 2014, the Company entered into a $56,250 Convertible Note with Auctus Private Equity Fund LLC. Auctus may convert the note into common stock at a 50% discount to the average 2 lowest trading days of 25 trading days prior to the conversion. The note is convertible 180 days from the date of the note. As of September 30, 2014, $50,000 was received. | |||||
In September 2014, JMJ Financial converted principal of $13,500 into 1,500,000 common shares in accordance with the Convertible Promissory Note dated December 4, 2013. | |||||
In September 2014, JMJ Financial converted principal of $14,672.22 into 1,630,247 common shares in accordance with the Convertible Promissory Note dated December 4, 2013. | |||||
In September 2014, the Company entered into an amendment to the Tangiers convertible note in the amount of $220,000 from February 2014. Iconic may convert the Note into common stock of the Company at the lower of $0.023 or a 50% discount to the trading price of the prior 25 trading days. The note is convertible 180 days from the date of the note. | |||||
In September 2014, Tangiers converted principal of $30,250 into 4,033,333 common shares in accordance with the Convertible Promissory Note dated February 27, 2014. | |||||
In September 2014, Tangiers converted principal of $30,250 into 4,033,333 common shares in accordance with the Convertible Promissory Note dated February 27, 2014. | |||||
In September 2014, the Company entered into a $55,250 Convertible Note with Auctus Private Equity Fund LLC. Auctus may convert the note into common stock at a 50% discount to the average 2 lowest trading days of 25 trading days prior to the conversion. The note is convertible 180 days from the date of the note. As of September 30, 2014, $50,000 was received. | |||||
The following table summarizes the changes in the derivative liabilities during the period ending September 30, 2014: | |||||
Balance as of December 31, 2013 | $ | 172,049 | |||
Debt discount | 581,929 | ||||
OID | (25,500 | ) | |||
Change in fair value | 557,747 | ||||
Other | 15,778 | ||||
Ending balance as of September 30, 2014 | $ | 1,302,003 | |||
The Company uses the Black Scholes Option Pricing Model to value its option based derivatives. | |||||
There were 5,000,000 common stock warrants outstanding on the date the convertible note agreement was entered into which became tainted. These warrants were valued using the Black Scholes Option Pricing Model based upon the following assumptions: dividend yield of -0-%, volatility of 277%, risk free rate of 0.11% and an expected term equal to the remaining exercise term of the warrants. The fair value of the warrants at September 30, 2014 was $102,758. |
Note_7Fair_Value_Measurements_
Note 7-Fair Value Measurements and Derivative Liabiliity | 9 Months Ended | ||||||||||||||||
Sep. 30, 2014 | |||||||||||||||||
Notes | |||||||||||||||||
Note 7-Fair Value Measurements and Derivative Liabiliity | Note 7—FAIR VALUE MEASUREMENTS AND DERIVATIVE LIABILIITY | ||||||||||||||||
The Company evaluates all of it financial instruments to determine if such instruments are derivatives or contain features that qualify as embedded derivatives. For derivative financial instruments that are accounted for as liabilities, the derivative instrument is initially recorded at its fair value and is then re-valued at each reporting date, with changes in the fair value reported as charges or credits to income. For option-based derivative financial instruments, the Company uses the Black-Scholes option-pricing model to value the derivative instruments at inception and subsequent valuation dates. The classification of derivative instruments, including whether such instruments should be recorded as liabilities or as equity, is re-assessed at the end of each reporting period. | |||||||||||||||||
Derivative instrument liabilities are classified in the balance sheet as current or non-current based on whether or not net-cash settlement of the derivative instrument could be required within 12 months of the balance sheet date. | |||||||||||||||||
Under ASC-815 the conversion options embedded in the notes payable described in Note 5 require liability classification because they do not contain an explicit limit to the number of shares that could be issued upon settlement. | |||||||||||||||||
During the period ending September 30, 2014, the Company entered into five convertible note agreements. The conversion option and the outstanding common stock warrants on that date which were tainted but the convertible notes were classified as derivative liabilities at their fair value on the date of issuance. | |||||||||||||||||
As defined in FASB ASC 820, fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date (exit price). The Company utilized the market data of similar entities in its industry or assumptions that market participants would use in pricing the asset or liability, including assumptions about risk and the risks inherent in the inputs to the valuation technique. These inputs can be readily observable, market corroborated, or generally unobservable. The Company classifies fair value balances based on the observability of those inputs. FASB ASC 820 establishes a fair value hierarchy that prioritizes the inputs used to measure fair value. The hierarchy gives the highest priority to unadjusted quoted prices in active markets for identical assets or liabilities (level 1 measurement) and the lowest priority to unobservable inputs (level 3 measurement). | |||||||||||||||||
The three levels of the fair value hierarchy are as follows: | |||||||||||||||||
Level 1 – Quoted prices are available in active markets for identical assets or liabilities as of the reporting date. Active markets are those in which transactions for the asset or liability occur in sufficient frequency and volume to provide pricing information on an ongoing basis. Level 1 primarily consists of financial instruments such as exchange-traded derivatives, marketable securities and listed equities. | |||||||||||||||||
Level 2 - Pricing inputs are other than quoted prices in active markets included in level 1, which are either directly or indirectly observable as of the reported date. | |||||||||||||||||
Level 3 - Pricing inputs include significant inputs that are generally less observable from objective sources. These inputs may be used with internally developed methodologies that result in management’s best estimate of fair value. | |||||||||||||||||
The following table sets forth by level within the fair value hierarchy the Company’s financial assets and liabilities that were accounted for at fair value at the period ending September 30, 2014. | |||||||||||||||||
Recurring Fair Value Measurements | Level 1 | Level 2 | Level 3 | Total | |||||||||||||
LIABILITIES: | |||||||||||||||||
Derivative liability - September 30, 2014 | - | - | 1,302,003 | 1,302,003 | |||||||||||||
Derivative liability - 2013 | - | - | 172,049 | 172,049 | |||||||||||||
Note_8Subsequent_Events
Note 8-Subsequent Events | 9 Months Ended |
Sep. 30, 2014 | |
Notes | |
Note 8-Subsequent Events | Note 8—SUBSEQUENT EVENTS |
In accordance with FASB ASC 855-10-50-1 we evaluated our subsequent events through November 14, 2014. | |
In October 2014, the Company entered into a 8% Convertible Note with Union Capital LLC in the amount of $50,000. Union may convert the note into common shares of the Company at a discount of 50% to the lowest trading price of the 20 trading days prior to the conversion date. | |
In October 2014, the Company entered into a $250,000 Convertible Note with Vista Capital Investments LLC. Vista may convert the note into common shares of the Company at $0.05 or a 60% discount to the lowest trading price of the 25 days prior to the conversion date. | |
In October 2014, JMJ Investments provided additional funding to the Company in the amount of $40,000 in accordance with the December 2013 agreement. | |
In October 2014, the Company entered into a 8% Convertible Note with LG Capital Funding LLC in the amount of $47,250. LG may convert the note into common shares of the Company at a 50% discount to the lowest trading price of the 15 days prior to the conversion date. | |
In October 2014, the Company entered into a 10% Convertible Note with Sarna Family Limited Partnership in the amount of $100,000. Sarna may convert the note into common shares of the Company at $0.01. | |
In October 2014, the Company entered into a 10% Convertible Note with private investor Mark Sarna in the amount of $100,000. Mr. Sarna may convert the note into common shares of the Company at $0.01. | |
In October 2014, the Company paid off the WHC Capital LLC Convertible Note in the amount of $240,000. | |
In October 2014, the Company agreed to buy a 55% equity interest in Harris Lee, LLC for 300,000 of the Company’s Preferred C Shares. | |
During October and November 2014, the Company issued 808,333 common shares to experts pursuant to agreements. |
Note_1Description_of_Business_1
Note 1-Description of Business and Basis of Presentation: Basis of Presentation (Policies) | 9 Months Ended |
Sep. 30, 2014 | |
Policies | |
Basis of Presentation | Basis of Presentation |
The accompanying unaudited interim financial statements of Pazoo, Inc. (“we”, “our”, “Pazoo” or the “Company”) have been prepared in accordance with accounting principles generally accepted in the United States of America and the rules of the Securities and Exchange Commission, and should be read in conjunction with Pazoo’s audited 2013 annual financial statements and notes thereto filed on Form 10-K with the SEC. In the opinion of management, all adjustments, consisting of normal reoccurring adjustments, necessary for a fair presentation of financial position and the results of operations for the interim periods present have been reflected herein. The results of operation for interim periods are not necessarily indicative of the results to be expected for the full year. Notes to the financial statements, which would substantially duplicate the disclosure required in Pazoo’s fiscal 2013 financial statements have been omitted. |
Note_1Description_of_Business_2
Note 1-Description of Business and Basis of Presentation: Description of Business (Policies) | 9 Months Ended |
Sep. 30, 2014 | |
Policies | |
Description of Business | Description of Business |
We are an early growth stage health and wellness company. Presently, our primary business is pazoo.com, an online, content driven, ad supported health and wellness web site for people and their pets. Additionally, this site has e-commerce functionality which allows pazoo.com to be an online retailer of nutritional foods/supplements, wellness goods, and fitness apparel. Pazoo, Inc. does not have any brick and mortar establishments. |
Note_3Stockholders_Equity_Comm
Note 3-Stockholders' Equity: Common Stock (Policies) | 9 Months Ended |
Sep. 30, 2014 | |
Policies | |
Common Stock | Common Stock |
In September 2014, the Company issued 3,776,389 common shares as per the Equity Purchase Agreement and Securities Purchase Agreement with Premier Venture Partners, LLC valued at $75,527. Premier Ventures also purchased 2,352,845 shares for $31,506 pursuant to put option exercised by the Company. | |
During the nine months ended September 30, 2014, the Company issued 21,207,412 shares to experts and consultants per agreements for services rendered, valued at $649,622. |
Note_3Stockholders_Equity_Pref
Note 3-Stockholders' Equity: Preferred Stock (Policies) | 9 Months Ended |
Sep. 30, 2014 | |
Policies | |
Preferred Stock | Preferred Stock |
In April 2014, the Company issued 125,000 shares of Series A Preferred Stock to ICPI in exchange for $125,000. | |
Simultaneous with the issuance of Series A Preferred Stock in April 2014, and under the Investment Agreement No. 4 we issued 125,000 warrants to ICPI which entitles its owner to purchase one share of Series A Preferred Stock for each Series A Preferred Stock at an exercise price of $2.00, subject to the terms of the warrant agreement between the warrant agent and us. | |
In March and May 2014, the Company issued 145,000 shares of Series A Preferred Stock to ICPI in exchange for $145,000. The Company also simultaneously issued 145,000 warrants to ICPI which entitles its owner to purchase one share of Series A Preferred Stock for each Series A Preferred Stock acquired at an exercise price of $2.00. | |
In March 2014, ICPI converted 17,000 Series A Preferred shares into 1,700,000 common shares. In August 2014, ICPI converted 60,000 preferred shares into 6,000,000 common shares. In July 2014, ICPI converted 72,500 preferred shares into 7,250,000 common shares. | |
In January and February 2014, ICPI exercised 80,000 Series A Preferred shares warrants at $0.50 for $40,000. | |
In August 2014, the Company issued Jordan Stroum 10,000 Series A Preferred Stock in exchange for services rendered per the agreement signed July 25, 2014. The shares were valued at $34,800. |
Note_3Stockholders_Equity_Warr
Note 3-Stockholders' Equity: Warrants (Policies) | 9 Months Ended | ||||||||
Sep. 30, 2014 | |||||||||
Policies | |||||||||
Warrants | Warrants | ||||||||
The following table presents the Series A preferred stock warrant activity during the nine months ended September 30, 2014: | |||||||||
Warrants | Weighted Average Exercise Price | ||||||||
Outstanding – December 31, 2013 | 823,226 | $ | 2.2 | ||||||
Granted | 270,000 | 2 | |||||||
Forfeited/Canceled | - | - | |||||||
Exercised | 80,000 | - | |||||||
Outstanding – September 30, 2014 | 1,013,226 | 2.28 | |||||||
Exercisable – September 30, 2014 | 1,013,226 | $ | 2.28 | ||||||
The weighted average remaining life of the outstanding Series A preferred stock warrants as of September 30, 2014 and December 31, 2013 was 3.49 and 3.92 years, respectively. | |||||||||
The following table presents the common stock warrant activity during the nine months ended September 30, 2014: | |||||||||
Warrants | Weighted Average Exercise Price | ||||||||
Outstanding – December 31, 2013 | 5,000,000 | $ | 0.05 | ||||||
Granted | 1,130,470 | 0.05 | |||||||
Forfeited/Canceled | - | - | |||||||
Exercised | - | - | |||||||
Outstanding – September 30, 2014 | 6,130,470 | 0.05 | |||||||
Exercisable – September 30, 2014 | 6,130,470 | $ | 0.05 | ||||||
The weighted average remaining life of the outstanding common stock warrants as of September 30, 2014 and December 31, 2013 was 0.73 and 1.26 years, respectively. |
Note_3Stockholders_Equity_Warr1
Note 3-Stockholders' Equity: Warrants: Schedule of Preferred Units (Tables) | 9 Months Ended | ||||||||
Sep. 30, 2014 | |||||||||
Tables/Schedules | |||||||||
Schedule of Preferred Units | |||||||||
Warrants | Weighted Average Exercise Price | ||||||||
Outstanding – December 31, 2013 | 823,226 | $ | 2.2 | ||||||
Granted | 270,000 | 2 | |||||||
Forfeited/Canceled | - | - | |||||||
Exercised | 80,000 | - | |||||||
Outstanding – September 30, 2014 | 1,013,226 | 2.28 | |||||||
Exercisable – September 30, 2014 | 1,013,226 | $ | 2.28 |
Note_3Stockholders_Equity_Warr2
Note 3-Stockholders' Equity: Warrants: Schedule of Stockholders' Equity Note, Warrants or Rights (Tables) | 9 Months Ended | ||||||||
Sep. 30, 2014 | |||||||||
Tables/Schedules | |||||||||
Schedule of Stockholders' Equity Note, Warrants or Rights | |||||||||
Warrants | Weighted Average Exercise Price | ||||||||
Outstanding – December 31, 2013 | 5,000,000 | $ | 0.05 | ||||||
Granted | 1,130,470 | 0.05 | |||||||
Forfeited/Canceled | - | - | |||||||
Exercised | - | - | |||||||
Outstanding – September 30, 2014 | 6,130,470 | 0.05 | |||||||
Exercisable – September 30, 2014 | 6,130,470 | $ | 0.05 |
Note_6Convertible_Note_and_Der1
Note 6-Convertible Note and Derivative Liabilities: Schedule of Derivative Liabilities at Fair Value (Tables) | 9 Months Ended | ||||
Sep. 30, 2014 | |||||
Tables/Schedules | |||||
Schedule of Derivative Liabilities at Fair Value | |||||
Balance as of December 31, 2013 | $ | 172,049 | |||
Debt discount | 581,929 | ||||
OID | (25,500 | ) | |||
Change in fair value | 557,747 | ||||
Other | 15,778 | ||||
Ending balance as of September 30, 2014 | $ | 1,302,003 |
Note_7Fair_Value_Measurements_1
Note 7-Fair Value Measurements and Derivative Liabiliity: Schedule of Fair Value, Assets and Liabilities Measured on Recurring Basis (Tables) | 9 Months Ended | ||||||||||||||||
Sep. 30, 2014 | |||||||||||||||||
Tables/Schedules | |||||||||||||||||
Schedule of Fair Value, Assets and Liabilities Measured on Recurring Basis | |||||||||||||||||
Recurring Fair Value Measurements | Level 1 | Level 2 | Level 3 | Total | |||||||||||||
LIABILITIES: | |||||||||||||||||
Derivative liability - September 30, 2014 | - | - | 1,302,003 | 1,302,003 | |||||||||||||
Derivative liability - 2013 | - | - | 172,049 | 172,049 |
Note_2Going_Concern_Details
Note 2-Going Concern (Details) (USD $) | Sep. 30, 2014 | Dec. 31, 2013 |
Details | ||
Accumulated deficit | $4,992,658 | $2,520,366 |
Note_3Stockholders_Equity_Comm1
Note 3-Stockholders' Equity: Common Stock (Details) (USD $) | 3 Months Ended | 9 Months Ended | |
Sep. 30, 2014 | Sep. 30, 2014 | Sep. 30, 2013 | |
Details | |||
Stock Issued During Period, Shares, New Issues | 3,776,389 | ||
Stock Issued During Period, Value, New Issues | $75,527 | ||
Stock Issued During Period, Shares, Issued for Services | 21,207,412 | ||
Common stock issued for services | $649,622 | $72,885 |
Note_4Loans_Payable_Details
Note 4-Loans Payable (Details) (USD $) | 3 Months Ended | 9 Months Ended |
Sep. 30, 2014 | Sep. 30, 2014 | |
Details | ||
Convertible debt issued for rent expense | $16,601 | ($16,601) |
Note_5Equity_Interest_Details
Note 5-Equity Interest (Details) (USD $) | Sep. 30, 2014 | Dec. 31, 2013 | ||
Details | ||||
Interest | $279,180 | [1] | $0 | [1] |
[1] | In MA Associate. |
Note_6Convertible_Note_and_Der2
Note 6-Convertible Note and Derivative Liabilities (Details) (USD $) | 9 Months Ended |
Sep. 30, 2014 | |
Details | |
Fair Value Adjustment of Warrants | $102,758 |