Document and Entity Information
Document and Entity Information - shares | 6 Months Ended | |
May 31, 2016 | Dec. 05, 2018 | |
Document And Entity Information | ||
Entity Registrant Name | AVALANCHE INTERNATIONAL, CORP. | |
Entity Central Index Key | 1,537,169 | |
Document Type | 10-Q | |
Trading Symbol | AVLP | |
Document Period End Date | May 31, 2016 | |
Amendment Flag | false | |
Current Fiscal Year End Date | --11-30 | |
Entity's Reporting Status Current | No | |
Entity Small Business | true | |
Entity Filer Category | Non-accelerated Filer | |
Entity Emerging Growth Company | true | |
Entity Ex Transition Period | false | |
Entity Common Stock, Shares Outstanding | 5,529,200 | |
Document Fiscal Period Focus | Q2 | |
Document Fiscal Year Focus | 2,016 |
Condensed Consolidated Balance
Condensed Consolidated Balance Sheets (Unaudited) - USD ($) | May 31, 2016 | Nov. 30, 2015 |
Current assets: | ||
Cash | $ 2,562 | $ 405 |
Accounts receivable, related party | 17,222 | 17,222 |
Notes receivable | 103,659 | |
Other current assets | 8,078 | 705 |
Total current assets | 131,521 | 18,332 |
Notes receivable, net of discount of $53,159 | 271,841 | |
Total assets | 403,362 | 18,332 |
Current liabilities: | ||
Accounts payable and accrued expenses | 145,519 | 105,137 |
Accounts payable and accrued expenses, related party | 198,209 | 63,699 |
Accrued interest on convertible and promissory notes payable | 213,165 | 71,867 |
Derivative warrant liabilities | 24,900 | |
Convertible notes payable, net of discount of $33,650 and $202,325, respectively | 1,928,334 | 1,729,987 |
Notes payable, net of discount of $68,369 and $19,294, respectively | 510,706 | 135,031 |
Notes payable, related party, net of discount of $2,800 | 38,137 | |
Total current liabilities | 3,058,970 | 2,105,721 |
Convertible notes payable, net of discount of $165,683 | 206,053 | |
Derivative warrant liabilities | 8,054 | |
Total liabilities | 3,273,077 | 2,105,721 |
Stockholders' Deficit: | ||
Common stock, $0.001 par value: 75,000,000 shares authorized; 6,842,254 and 6,309,635 shares issued and outstanding at May 31, 2016 and November 30, 2015, respectively | 6,843 | 6,310 |
Additional paid-in capital | 1,326,633 | 1,119,118 |
Accumulated deficit | (4,203,191) | (3,212,817) |
Total stockholders' deficit | (2,869,715) | (2,087,389) |
Total liabilities and stockholders' deficit | 403,362 | 18,332 |
Class A Preferred Stock [Member] | ||
Stockholders' Deficit: | ||
Preferred stock | ||
Preferred Class B [Member] | ||
Stockholders' Deficit: | ||
Preferred stock |
Condensed Consolidated Balanc_2
Condensed Consolidated Balance Sheets (Unaudited) (Parenthetical) - USD ($) | May 31, 2016 | Nov. 30, 2015 |
Notes receivable, discount | $ 53,159 | |
Convertible notes payable, discount | 33,650 | 202,325 |
Notes payable, discount | 68,369 | 19,294 |
Notes payable, related party, net of discount | 2,800 | |
Convertible notes payable, discount | $ 165,683 | |
Preferred stock, par value (in dollars per share) | $ 0.001 | $ 0.001 |
Preferred stock, authorized | 10,000,000 | 10,000,000 |
Common stock, par value (in dollars per share) | $ 0.001 | $ 0.001 |
Common stock, shares authorized | 75,000,000 | 75,000,000 |
Common stock, issued | 6,842,254 | 6,309,635 |
Common stock, outstanding | 6,842,254 | 6,309,635 |
Class A Preferred Stock [Member] | ||
Preferred stock, stated par value (in dollars per share) | $ 20 | $ 20 |
Preferred stock, authorized | 50,000 | 50,000 |
Preferred stock, issued | ||
Preferred stock, outstanding | ||
Preferred Class B [Member] | ||
Preferred stock, stated par value (in dollars per share) | $ 50 | $ 50 |
Preferred stock, authorized | 100,000 | 100,000 |
Preferred stock, issued | ||
Preferred stock, outstanding |
Condensed Consolidated Statemen
Condensed Consolidated Statements of Operations (Unaudited) - USD ($) | 3 Months Ended | 6 Months Ended | ||
May 31, 2016 | May 31, 2015 | May 31, 2016 | May 31, 2015 | |
Income Statement [Abstract] | ||||
Revenue - related party | $ 23,547 | $ 33,848 | ||
Revenue | 120 | 4,814 | ||
Total Revenue | 23,667 | 38,662 | ||
Cost of revenue | (20,758) | (29,292) | ||
Gross profit | 2,909 | 9,370 | ||
Operating expenses: | ||||
General and administrative expenses | 196,225 | 313,005 | 371,995 | 499,835 |
Total operating expenses | 196,225 | 313,005 | 371,995 | 499,835 |
Loss from operations | (196,225) | (310,096) | (371,995) | (490,465) |
Other income (expense): | ||||
Interest income | 42,268 | 48,708 | ||
Interest expense, including penalties | (109,351) | (68,669) | (192,671) | (79,869) |
Interest expense - debt discount | (118,351) | (84,178) | (258,867) | (84,178) |
Loss on issuance of convertible debt | (68,522) | (301,309) | (71,061) | (301,309) |
Loss on conversion of convertible debt | 154,694 | |||
Change in fair value of bifurcated embedded conversion options and derivative warrant liabilities | (231,937) | 182,776 | 10,206 | 182,776 |
Total other expense, net | (485,893) | (271,380) | (618,379) | (282,580) |
Net loss | (682,118) | (581,476) | (990,374) | (773,045) |
Preferred dividends | ||||
Net loss available to common shareholders | $ (682,118) | $ (581,476) | $ (990,374) | $ (773,045) |
Basic and diluted net loss per common share (in dollars per share) | $ (0.10) | $ (0.11) | $ (0.15) | $ (0.14) |
Basic and diluted weighted average common shares outstanding (in shares) | 6,842,254 | 5,451,384 | 6,680,701 | 5,336,296 |
Consolidated Statements of Cash
Consolidated Statements of Cash Flows (Unaudited) - USD ($) | 6 Months Ended | |
May 31, 2016 | May 31, 2015 | |
Cash Flows from Operating Activities: | ||
Net loss | $ (990,374) | $ (773,045) |
Adjustments to reconcile net loss to net cash used in operating activities: | ||
Amortization expense-loan fees | 48,095 | |
Interest income-amortization of original issue discount | (35,174) | |
Interest expense on warrant issuance | 26,250 | |
Interest expense-debt discount | 258,867 | 84,178 |
Loss on issuance of convertible debt | 71,061 | 301,309 |
Loss on conversion of convertible debt | 154,694 | |
Change in fair value of bifurcated embedded conversion options and derivative warrant liabilities | (10,206) | (182,776) |
Stock-based compensation | 20,000 | 251,833 |
Stock issued for loan fees | 50,314 | |
Changes in operating assets and liabilities: | ||
Accounts receivable | (16,919) | |
Other receivables | (7,373) | |
Inventories | 25,900 | |
Other assets | (179) | |
Accounts payable and accrued expenses | 40,382 | 81,339 |
Accounts payable and accrued expenses, related parties | 109,510 | (47,024) |
Accrued interest on convertible and promissory notes payable | 162,322 | 6,610 |
Net cash used in operating activities | (200,041) | (170,365) |
Cash Flows from Investing Activities: | ||
Purchase of note receivable | (345,000) | (150,000) |
Principal payments received on note receivable | 19,674 | |
Net cash used in investing activities | (325,326) | (150,000) |
Cash Flows from Financing Activities: | ||
Proceeds from issuance of common stock | 5,000 | 2,000 |
Payments to related parties | (7,335) | |
Proceeds from issuance of convertible notes | 157,000 | 330,000 |
Payments of convertible notes payable | (5,000) | |
Proceeds from issuance of notes payable | 355,000 | |
Proceeds from issuance of notes payable, related party | 51,625 | |
Payments of notes payable | (20,250) | (5,000) |
Payments of notes payable, related party | (15,851) | |
Net cash provided by financing activities | 527,524 | 319,665 |
Net change in cash | 2,157 | (700) |
Cash - beginning of the period | 405 | 2,247 |
Cash - ending of the period | 2,562 | 1,547 |
Supplemental disclosures of cash flow information: | ||
Cash paid during the period for interest | 2,200 | |
Supplemental schedule of non-cash investing and financing activities: | ||
Decrease in accounts payable and accrued expenses-related party in connection with the purchase of a third-party note receivable | 25,000 | |
Decrease in notes payable in connection with reduction in note receivable | (10,000) | |
Common stock issued for conversion of debt and accrued interest | 183,048 | |
Decrease in notes payable in connection with common stock issued | (7,330) | |
Decrease in accrued interest in connection with common stock issued | $ (21,024) | |
Issuance of preferred stock to shareholder for payment of accrued expenses, related party | 76,900 | |
Warrants issued in connection with notes payable | $ 30,987 |
ORGANIZATION AND DESCRIPTION OF
ORGANIZATION AND DESCRIPTION OF BUSINESS | 6 Months Ended |
May 31, 2016 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
ORGANIZATION AND DESCRIPTION OF BUSINESS | 1. ORGANIZATION AND DESCRIPTION OF BUSINESS Avalanche International, Corp. (the “Company” “Avalanche” “SRB” “RCG” |
LIQUIDITY AND GOING CONCERN
LIQUIDITY AND GOING CONCERN | 6 Months Ended |
May 31, 2016 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
LIQUIDITY AND GOING CONCERN | 2. LIQUIDITY AND GOING CONCERN The accompanying unaudited condensed consolidated financial statements have been prepared on the basis that the Company will continue as a going concern. The Company has incurred recurring losses and reported losses available to common stockholders for the six months ended May 31, 2016 and 2015, totaling $990,374 and $773,045, respectively, as well as an accumulated deficit as of May 31, 2016 amounting to $4,203,191. As a result of the Company’s continued losses, at May 31, 2016, the Company’s current liabilities significantly exceed current assets, resulting in negative working capital of $2,927,449. Further, the Company does not have adequate cash to cover projected operating costs for twelve months from the issuance date of these financial statements and to repay convertible notes payable and notes payable in the aggregate principal amount of $716,575 that are in default at May 31, 2016. These factors raise substantial doubt about the ability of the Company to continue as a going concern. In order to ensure the continued viability of the Company, either future equity or debt financings must be obtained or profitable operations must be achieved in order to repay the existing short-term debt and to provide a sufficient source of operating capital. To address its liquidity issues, the Company continues to explore opportunities for additional financing and/or restructuring of its existing debt. No assurances can be made that the Company will be successful obtaining additional equity or debt financing and/or in restructuring existing debt, or that the Company will achieve profitable operations and positive cash flow. The unaudited condensed consolidated financial statements do not include any adjustments to reflect the possible future effects on the recoverability and classification of assets or the amounts and classifications of liabilities that may result should the Company be unable to continue as a going concern. Further, subsequent to year end the Company has primarily funded its operations through the issuance of additional debt financings (see Note 12). |
SUMMARY OF SIGNIFICANT ACCOUNTI
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | 6 Months Ended |
May 31, 2016 | |
Accounting Policies [Abstract] | |
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | 3. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Basis of Presentation The accompanying unaudited condensed consolidated financial statements have been prepared in accordance with the instructions to Securities and Exchange Commission (the “SEC”) Form 10-Q and Article 8 of SEC Regulation S-X and do not include all the information and disclosures required by generally accepted accounting principles in the United States of America ( “GAAP” Principles of Consolidation The unaudited condensed consolidated financial statements include accounts of Avalanche and its wholly-owned subsidiaries, SRB and RCG (collectively referred to as the “Company” Accounting Estimates The preparation of financial statements, in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. The Company’s critical accounting policies that involve significant judgment and estimates include fair value of bifurcated embedded conversion options and derivative warrant liabilities and the valuation of deferred income taxes. Actual results could differ from those estimates. Fair Value of Financial Instruments The Company’s significant financial instruments include cash, accounts receivable, notes receivable, accounts payable and accrued expenses, notes payable, and convertible notes payable. The recorded values of cash, accounts receivable, notes receivable, and accounts payable approximate their fair values based on their short-term nature. Notes payable and convertible notes payable are recorded inclusive of the value of any bifurcated embedded feature, which approximates their fair value. Equity-Linked Financial Instruments Derivative liabilities are recognized in the consolidated balance sheets at fair value based on the criteria specified in Financial Accounting Standards Board ( “FASB” “ASC” – Derivatives and Hedging – Embedded Derivatives “ASC 815-15” Pursuant to ASC Topic 815-15 an evaluation of the embedded conversion feature of convertible debt is evaluated to determine if the embedded debt conversion feature is required to be bifurcated from the debt instrument, valued and classified with the related loan host instrument. When the terms of the embedded conversion features of the Company’s convertible debt provides for the issuance of shares of common stock at the election of the holders and the number of shares is subject to adjustment for a decline in the price of the Company’s common stock, the Company determined that the embedded conversion option should be bifurcated. The estimated fair value of the conversion features, when bifurcated, are primarily determined using a Monte Carlo model or, in certain circumstances, the Black-Scholes option pricing model. The models utilize Level 3 unobservable inputs to calculate the fair value of the derivative liabilities at each reporting period. The Company determined that in instances where a Black-Scholes option pricing model was used that using an alternative valuation model such as a Monte Carlo model would result in minimal differences. Each reporting period the embedded conversion feature for each applicable debt instrument is re-valued and adjusted through the caption “change in fair value of derivative liability” on the consolidated statements of operations. Certain of the Company’s convertible notes issued during the year ended November 30, 2015 contain conversion terms that provide for a variable conversion price (e.g. 55% of the lowest trading price of the Company’s common stock for the 25 days preceding conversion) for a fixed amount (i.e. face value of the note). This results in the number of shares to be issued upon conversion to be essentially indeterminable and prevents the Company from concluding that the related conversion feature does not need to be bifurcated as a derivate liability in accordance with ASC 815. Thus, equity-linked financial instruments, which are convertible or exercisable into common stock, issued subsequent to the convertible notes are classified as derivative liabilities, with the exception of instruments related to employee share-based compensation. Warrant Liability The Company accounts for certain common stock warrants outstanding as a liability at fair value and adjusts the instruments to fair value at each reporting period. This liability is subject to re-measurement at each balance sheet date until exercised, and any change in fair value is recognized in the Company's consolidated statements of operations. The fair value of the warrants issued by the Company has been estimated using a Black-Scholes option pricing model, at each measurement date. Debt Discounts The Company accounts for debt discounts originating in connection with conversion features that remain embedded in the related notes in accordance with ASC 470-20, Debt with Conversion and Other Options Sequencing As of March 1, 2016, the Company adopted a sequencing policy whereby all future instruments may be classified as a derivative liability with the exception of instruments related to share-based compensation issued to employees or directors. Revenue Recognition The Company recognizes revenue when it is realized or realizable and earned. The Company considers revenue realized or realizable and earned when all of the following criteria are met: (i) persuasive evidence of an arrangement exists, (ii) the product has been shipped or the services have been rendered to the customer, (iii) the sales price is fixed or determinable, and (iv) collectability is reasonably assured. No revenue was recorded during the three and six months ended May 31, 2016. During the three and six months ended May 31, 2016, the Company’s revenues consisted solely of sales of flavored liquids for electronic vaporizers and eCigarettes and accessories from SRB. Loss per Common Share Pursuant to ASC Topic No. 260, Earnings per Share, Since the effects of the conversion of convertible debt are anti-dilutive in all periods presented, shares of common stock underlying these instruments have been excluded from the computation of loss per common share. The following sets forth the number of shares of common stock underlying convertible debt as of May 31, 2016 and 2015: May 31, 2016 2015 Convertible notes payable 11,449,546 604,167 Common stock warrants 175,000 - 11,624,546 604,167 Reclassifications Certain prior period amounts have been reclassified for comparative purposes to conform to the current period financial statement presentation. These reclassifications had no effect on previously reported results of operations. In addition, certain prior period amounts from the revised amounts have been reclassified for consistency with the current period presentation. Recent Accounting Pronouncements The Company has considered all recently issued accounting pronouncements and does not believe the adoption of such pronouncements will have a material impact on its condensed consolidated financial statements. |
REVISION OF PREVIOUSLY ISSUED F
REVISION OF PREVIOUSLY ISSUED FINANCIAL STATEMENTS | 6 Months Ended |
May 31, 2016 | |
Revision Of Previously Issued Financial Statements | |
REVISION OF PREVIOUSLY ISSUED FINANCIAL STATEMENTS | 4. REVISION OF PREVIOUSLY ISSUED FINANCIAL STATEMENTS The condensed consolidated financial statements for the three and six months ended May 31, 2015 have been revised to expense the previously capitalized licensing fee and to reclassify original issue discount that was initially recorded as a prepaid asset to debt discount. An analysis of those revised numbers is reflected below. Condensed Consolidated Balance Sheet (unaudited) May 31, 2015 As reported Adjustment As revised Assets Total current assets $ 356,883 $ - $ 356,883 Total assets $ 411,588 $ (54,000 ) $ 357,588 Liabilities and Stockholders' Deficit: Total current liabilities $ 687,772 $ - $ 687,772 Total liabilities and stockholders' deficit $ 411,588 $ (54,000 ) $ 357,588 Condensed Consolidated Statement of Operations (unaudited) F or the Three Months Ended May 31, 2015 As reported Adjustment As revised General and administrative expenses $ 301,755 $ 11,250 $ 313,005 Loss from operations $ (298,846 ) $ (11,250 ) $ (310,096 ) Net loss $ (570,226 ) $ (11,250 ) $ (581,476 ) Basic and diluted net loss per share $ (0.10 ) $ (0.00 ) $ (0.11 ) Weighted average shares outstanding, basic and diluted 5,451,384 5,451,384 5,451,384 Condensed Consolidated Statement of Operations (unaudited) For the Six Months Ended May 31, 2015 As reported Adjustment As revised General and administrative expenses $ 475,085 $ 24,750 $ 499,835 Loss from operations $ (465,715 ) $ (24,750 ) $ (490,465 ) Net loss $ (748,295 ) $ (24,750 ) $ (773,045 ) Basic and diluted net loss per share $ (0.14 ) $ (0.00 ) $ (0.14 ) Weighted average shares outstanding, basic and diluted 5,336,296 5,336,296 5,336,296 In accordance with SEC Staff Accounting Bulletin No 108, the Company has evaluated this error, based on an analysis of quantitative and qualitative factors, as to whether it was material to the condensed consolidated statements of operations for the three and six months ended May 31, 2015 and if amendments of previously filed financial statements with the SEC are required. The Company has determined that the adjustment is qualitatively not material and, therefore, the error has no material impact to the condensed consolidated statements of operations for the three and six months ended May 31, 2015 or other prior periods. |
WARRANTS
WARRANTS | 6 Months Ended |
May 31, 2016 | |
Warrants | |
WARRANTS | 5. WARRANTS During the six months ended May 31, 2016, the Company issued a total of 175,000 warrants at an average exercise price of $0.13 per share. (i) On December 2, 2015, the Company issued warrants to purchase an aggregate of 100,000 shares of common stock at an exercise price equal to $0.01 per share of common stock in connection with the issuance of a promissory note in the aggregate principal amount of $125,000 (See Note 8d). (ii) On January 20, 2016, the Company entered into an agreement with LG Capital Funding, LLC to amend the terms of a convertible promissory note in the principal amount of $50,000. Pursuant to the amendment, the Company granted LG Capital 75,000 warrants with an exercise price of $0.30 per share (See Note 7f). The following table summarizes information about common stock warrants outstanding at May 31, 2016: Outstanding Exercisable Weighted Average Weighted Weighted Remaining Average Average Exercise Number Contractual Exercise Number Exercise Price Outstanding Life (Years) Price Exercisable Price $0.01 100,000 0.51 $ 0.01 100,000 $ 0.01 $0.30 75,000 2.64 $ 0.30 75,00 $ 0.30 $0.01 - $0.30 175,000 1.42 $ 0.13 175,000 $ 0.13 The Company has valued the warrants at their date of grant utilizing the Black-Scholes option pricing model. This model is dependent upon several variables such as the warrants’ term, exercise price, current stock price, risk-free interest rate and estimated volatility of our stock over the contractual term of the warrants. The risk-free interest rate used in the calculations is based on the implied yield available on U.S. Treasury issues with an equivalent term approximating the contractual life of the warrants. The following weighted average assumptions were used for grants during the six months ended May 31, 2016: May 31, 2016 Weighted average risk-free interest rate 0.52% Weighted average life (in years) 2.0 Volatility 167.9% — 184.9% Expected dividend yield 0% Weighted average grant-date fair value per $ 0.41 |
NOTES RECEIVABLE
NOTES RECEIVABLE | 6 Months Ended |
May 31, 2016 | |
Receivables [Abstract] | |
NOTES RECEIVABLE | 6. NOTES RECEIVABLE May 31, 2016 Notes receivable - Philo Group $ 325,000 Notes receivable - JS Technologies, Inc. 103,659 Total notes receivable 428,659 Less: original issue discount (53,159 ) Total notes receivable, net $ 375,500 Less: current portion (103,659 ) Notes receivable – long-term portion $ 271,841 On April 13, 2016, the Company entered into an agreement to finance a new restaurant owned by Philo Group, LLC (“ Philo Philo Note The original issue discount of $75,000 on the Philo Note is being amortized as interest income through the maturity date using the interest rate method. During the three and six months ended May 31, 2016, the Company recorded $21,841 of interest income from the discount accretion and $8,208 of interest income based upon the 16% contractual rate. JS Technologies, Inc. On August 4, 2015, the Company entered into a Secured Promissory Note (the “JST Note”) with JS Technologies, Inc. (“JST”). Under the JST Note, the Company entered into an agreement to lend up to $400,000 to JST in order to provide short-term financing pending the Company’s proposed acquisition of JST. The JST Note accrues interest at a rate of ten percent (10%) per annum and was due on August 5, 2016. The JST Note is secured by substantially all of the assets of JST. Between December 3, 2015 and February 26, 2016, the Company loaned JST $120,000 pursuant to the term of the JST Note, which included an original issue discount of $13,333 to the overall JST Note. Of the $120,000 loaned to JST, a payment of $95,000 was made by the Company and a payment of $25,000 was made by MCKEA Holdings, LLC (“ MCKEA The original issue discount of $13,333 on the JST Note was being amortized as interest income using the effective interest rate method. During the three and six months ended May 31, 2016, the Company recorded $9,358 and $13,333, respectively, of interest income from the discount accretion and $2,860 and $5,326, respectively, of interest income based upon the 10% contractual rate. |
CONVERTIBLE NOTE PAYABLE
CONVERTIBLE NOTE PAYABLE | 6 Months Ended |
May 31, 2016 | |
Debt Disclosure [Abstract] | |
CONVERTIBLE NOTE PAYABLE | 7. CONVERTIBLE NOTES PAYABLE May 31, 2016 November 30, 2015 Adar Bays, LLC Note (a): Principal value $ 115,000 $ 115,000 Fair value of bifurcated put option of Adar Bays, LLC Note 186,694 207,659 Debt discount - (40,411 ) Carrying amount of Adar Bays, LLC Note 301,694 282,248 Union Capital, LLC Note (a): Principal value 115,000 115,000 Fair value of bifurcated put option of Union Capital, LLC Note 186,611 207,536 Debt discount - (40,096 ) Carrying amount of Union Capital, LLC Note 301,611 282,440 Typenex Co-Investement, LLC Note (b): Principal value 87,500 87,500 Fair value of bifurcated put option of Typenex Co-Investement, LLC Note 373,733 380,858 Debt discount (153 ) (28,130 ) Carrying amount of Typenex Co-Investement, LLC Note 461,080 440,228 May 31, 2016 November 30, 201 Gary Gelbfish Note (c): Principal value 100,000 100,000 Fair value of bifurcated put option of Gary Gelbfish Note 203,030 118,391 Debt discount - - Carrying amount of Gary Gelbfish Note 303,030 218,391 JMJ Financial Note (d): Principal value 60,500 60,500 Fair value of bifurcated put option of JMJ Financial Note 212,973 155,017 Debt discount (30,160 ) (44,576 ) Carrying amount of JMJ Financial Note 243,313 170,941 Black Mountain Equities, Inc. Note (e): Principal value 42,670 55,000 Fair value of bifurcated put option of Black Mountain Equities, Inc. Note 57,516 81,951 Debt discount (453 ) (28,028 ) Carrying amount of Black Mountain Equities, Inc. Note 99,733 108,923 LG Capital Funding, LLC Note (f): Principal value 50,000 50,000 Fair value of bifurcated put option of LG Capital Funding, LLC Note 76,462 94,905 Debt discount - - Carrying amount of LG Capital Funding, LLC Note 126,462 144,905 GCEF Opportunitity Fund, LLC Note (g): Principal value 27,500 27,500 Fair value of bifurcated put option of GCEF Opportunity Fund, LLC Note 39,809 50,532 Debt discount (2,185 ) (15,973 ) Carrying amount of GCEF Opportunitity Fund, LLC Note 65,124 62,059 Lord Abstract, LLC Note (h): Principal value 8,800 8,800 Fair value of bifurcated put option of Lord Abstract, LLC Note 18,186 16,163 Debt discount (699 ) (5,111 ) Carrying amount of Lord Abstract LLC Note 26,287 19,852 JLA Realty Notes (i): Principal value 160,600 - Fair value of bifurcated conversion option of JLA Realty Notes 166,930 - Debt discount (156,451 ) - Carrying amount of JLA Realty Notes 171,079 - Other convertible notes payable (j): Principal value 11,000 - Fair value of bifurcated put option of other convertible notes payable 33,206 - Debt discount (9,232 ) - Carrying amount of other convertible notes payable 34,974 - Total carrying amount of convertible notes $ 2,134,387 $ 1,729,987 Total short-term carrying amount of convertible notes $ 1,928,334 $ - Total long-term carrying amount of convertible notes $ 206,053 $ - May 31, 2016 November 30, 2015 Total convertible notes payable: Principal value $ 778,570 $ 619,300 Fair value of bifurcated put option of other convertible notes payable 1,555,150 1,313,012 Debt discount (199,333 ) (202,325 ) Carrying amount of other convertible notes payable $ 2,134,387 $ 1,729,987 Accounting for Redemption Feature- Put Option Management determined that the variable share settlement feature as a “conversion feature” as defined above represented, in substance, a put option (redemption feature) designed to provide the investor with a fixed monetary amount, settleable in shares. Management determined that this put option should be separated and accounted for as a derivative and classified as a liability primarily because the put option met the net settlement criterion and the settlement provisions were not consistent with a fixed-for-fixed equity instrument. The put option, with a fair value of approximately $1.2 million at inception, was initially recorded as a derivative liability on the accompanying balance sheet and a corresponding discount to the note. The Company accreted the discount to interest expense on the statement of operations over the term of the note using the effective interest rate method. During the three months ended May 31, 2016 and 2015, the Company recognized interest expense of $75,891 and $84,178, respectively, resulting from amortization of the debt discount for the above convertible promissory notes. During the six months ended May 31, 2016 and 2015, the Company recognized interest expense of $170,441 and $84,178, respectively, resulting from amortization of the debt discount for the above convertible promissory notes. The difference between the estimated fair value of the conversion feature and the debt discount was reflected as a loss on issuance of convertible debt and during the three and six months ended March 31, 2016, the loss on issuance amounted to $68,522 and $71,061, respectively. In January 2016, the Company issued 457,619 shares of common stock in payment of principal and accrued interest on three of its convertible notes. The shares were valued based on the closing price of the Company’s common stock on the date of issuance, $183,048, resulting in a loss on conversion of $154,694. The accrued interest associated with the convertible notes was $130,419 as of May 31, 2016. All long-term notes are due in fiscal year 2019. (a) The Adar Bays, LLC and Union Capital, LLC convertible notes payable were due and payable 12 months after issuance date of May 11, 2015 and bore interest at 8% per annum. At the election of the holder, outstanding principal and accrued but unpaid interest under the notes were convertible into shares of the Company’s common stock at any time prior to maturity at a conversion price per share equal to a forty percent (40%) discount to the lowest trading price for the twenty (20) consecutive trading days immediately preceding the notice of conversion. If these notes were not paid at maturity, the outstanding principal due under these notes shall increase by 10%. In January 2016, the notes were amended to decrease the conversion price per share equal to a forty-five percent (45%) discount to the lowest trading price for the twenty-five (25) consecutive trading days immediately preceding the notice of conversion, and the pre-payment penalty was increased to 150%. The amendments did not result in a material change to the fair value of the notes. The notes were not repaid on the maturity date of May 12, 2016 and as such were in default as of May 31, 2016. The Company recorded in interest expense, including penalties, on the condensed statements of operations a one-time default penalty of $23,000 representing 10% of the outstanding principal balance of the Notes. As of May 31, 2016, there were 1,916,667 shares issuable upon conversion for each note. On January 23, 2018, the Company, Adar Bays, LLC and Union Capital, LLC entered into Note Settlement and Termination Agreements. Pursuant to the terms of the settlement agreements, the Company agreed to satisfy each of the outstanding notes for $200,000 and 100,000 shares of common stock. The payments were made on January 26, 2018. The closing price of the Company's common stock on January 23, 2018 was $1.40 per share resulting in an aggregate value of $340,000 per note. (b) The Typenex Co-Investment, LLC convertible note payable is due and payable 13 months after issuance date of May 29, 2015 and bears interest at 10% per annum. At the election of the holder, outstanding principal and accrued but unpaid interest under the note are convertible into shares of the Company’s common stock at any time prior to maturity at a conversion price per share equal to $1.30. However, in the event the Company’s market capitalization falls below $3.0 million at any time, the conversion price per share shall be equal to the lower of $1.30 or the market price at the date of conversion. The note was not repaid on the maturity date of June 29, 2016 and was also in default of certain conditions of the note as of May 31, 2016. The Company recorded in interest expense, including penalties, on the condensed statements of operations a one-time default penalty of approximately $18,200. As of May 31, 2016, there were 2,966,548 shares issuable upon conversion of this note. On or around April 19, 2016, the Company received from counsel for Typenex, a written demand to accelerate and demand payment of the entire outstanding balance of the Typenex note entered into between the Company and Typenex on May 29, 2015. On June 7, 2016, Typenex filed suit in the State of Utah, the Third Judicial District Court, County of Salt Lake, for repayment of all principal, default effects, late fee and accrued interest. According to the complaint, Typenex asserted an aggregate amount due, as of June 6, 2016, of $149,054. On April 4, 2017, the Company and Typenex agreed to settle the lawsuit for payment of $90,000, which was paid in April 2017. On May 9, 2017, an order of dismissal with prejudice was entered by the Third Judicial District Court. (c) The Gary Gelbfish convertible note payable was due and payable six months after the issuance date of March 27, 2015 and bore interest at 10% per annum. If this note was not paid at maturity, at the election of the holder, outstanding principal and accrued but unpaid interest under the note was convertible into shares of the Company’s common stock at a conversion price per share equal to lesser of: (i) fifty percent (50%) discount to the average closing price for the twenty (20) consecutive trading days immediately preceding the maturity date or (ii) $0.50 per share. The note was not repaid on the maturity date of September 23, 2015 and as such was in default as of May 31, 2016 and remains in default as of the date of this report. As of May 31, 2016, there were 767,754 shares issuable upon conversion of this note. (d) The JMJ Financial convertible note payable is due and payable 24 months after issuance date of April 29, 2015 and bears interest at 12% per annum. At the election of the holder, outstanding principal and accrued but unpaid interest under the notes are convertible into shares of the Company’s common stock at any time prior to maturity at a conversion price per share equal to a forty percent (40%) discount to the lowest trading price for the twenty-five (25) consecutive trading days immediately preceding the notice of conversion. As of May 31, 2016, there were 875,000 shares issuable upon conversion of this note. Between May 2018 and July 2018, the Company made payments of $35,000 on this note and the remaining principal balance of $25,500 remains in default as of the date of this report. (e) The Black Mountain Equities, Inc. convertible note payable is due and payable 12 months after issuance date of June 4, 2015 and bears interest at 10% per annum. At the election of the holder, outstanding principal and accrued but unpaid interest under the note is convertible into shares of the Company’s common stock at any time prior to maturity at a conversion price per share equal to the lesser of: (i) forty percent (40%) discount to the lowest trading price for the twenty-five (25) consecutive trading days immediately preceding the notice of conversion or (ii) $1.06 per share. As of May 31, 2016, there were 627,024 shares issuable upon conversion of this note. The Note was not repaid on the maturity date of June 4, 2016 and remains in default as of the date of this report. (f) The LG Capital Funding, LLC convertible note payable was due and payable 13 months after issuance date of November 3, 2014 and bore interest at 8% per annum. At the election of the holder, outstanding principal and accrued but unpaid interest under the note were convertible into shares of the Company’s common stock, at any time after 180 days from the date of issuance, at a conversion price per share equal to a forty percent (40%) discount to the lowest trading price for the twenty (20) consecutive trading days immediately preceding the notice of conversion. In January, 2016, the note was amended to grant LG Capital 75,000 warrants with an exercise price of $0.30 per share, and to permit the Company to re-pay the LG Capital Note with a pre-payment penalty of 120%. The amendment did not result in a material change to the fair value of the note. The fair value of the warrants was $26,250, which was expensed at the time of issuance due to the short-term nature of the note. The note was not repaid on the maturity date and as such is in default as of May 31, 2016 and as of the date of this report. Upon default, the note accrues interest at 24% per annum. As of May 31, 2016, there were 694,444 shares issuable upon conversion of this note. (g) The GCEF Opportunity Fund, LLC convertible note payable is due and payable 12 months after issuance date of June 30, 2015 and bears interest at 10% per annum. At the election of the holder, outstanding principal and accrued but unpaid interest under the note are convertible into shares of the Company’s common stock, at any time after 30 days from the date of issuance, at a conversion price per share equal to the lower of: (i) a forty percent (40%) discount to the lowest closing price for the twenty (20) consecutive trading days immediately preceding the notice of conversion or (ii) $1.00. If this note is not paid at maturity, then the interest rate shall increase to 24% thereafter. As of May 31, 2016, there were 381,944 shares issuable upon conversion of this note. On March 9, 2017, the Company issued an aggregate of 216,946 shares of its common stock as full repayment of the principal and accrued interest on the note. (h) The Lord Abstract, LLC convertible note payable is due and payable 12 months after issuance date of June 30, 2015 and bears interest at 10% per annum. At the election of the holder, outstanding principal and accrued but unpaid interest under the note are convertible into shares of the Company’s common stock, at any time after 30 days from the date of issuance, at a conversion price per share equal to a forty percent (40%) discount to the lowest closing price for the twenty (20) consecutive trading days immediately preceding the notice of conversion. If this note is not paid at maturity, then the interest rate shall increase to 24% thereafter. As of May 31, 2016, there were 122,222 shares issuable upon conversion of this note. Between June 2016 and August 2016, the Company made payments of $7,500 on this note and the remaining principal balance of $1,300 remains in default as of the date of this report. (i) The JLA Realty convertible note payable is due and payable 36 months after proceeds have been received by the Company, which occurred between April 25, 2016 and May 4, 2016 and bears interest at 12% per annum. At the election of the holder, outstanding principal and accrued but unpaid interest under the note is convertible into shares of the Company’s common stock at any time prior to maturity at a fixed price per share equal to $0.15. In connection with the issuance of the JLA Realty note described above, the Company recognized a debt discount of $146,000 and a loss on issuance of $68,522 during the three months ended May 31, 2016, which represents the excess of the fair value of the bifurcated conversion feature at initial issuance of approximately $215,000 over the principal amount of convertible debt issued. The fair value of the bifurcated conversion feature is separately measured at fair value, with changes in fair value recognized in operations. During the three and six months ended May 31, 2016, the Company recognized interest expense of $4,151 resulting from amortization of the debt discount for the JLA Realty note. As of May 31, 2016, the bifurcated conversion option has a fair value of $166,930 and is presented on a combined basis with the related loan host in the Company’s Condensed Consolidated Balance Sheet at May 31, 2016. As of May 31, 2016, there were 1,070,607 shares issuable upon conversion of this note. (j) The other convertible notes payable are due and payable 36 months after issuance and bear interest at 10% per annum. At the election of the holder, outstanding principal and accrued but unpaid interest under the note are convertible into shares of the Company’s common stock, at any time after six months from the date of issuance, at a conversion price per share equal the lesser of: (i) fifty percent (50%) discount to the volume weighted average price over the twenty (20) consecutive trading days immediately preceding the notice of conversion. As of May 31, 2016, there were 110,609 shares issuable upon conversion of these notes. |
NOTES PAYABLE
NOTES PAYABLE | 6 Months Ended |
May 31, 2016 | |
Notes Payable [Abstract] | |
NOTES PAYABLE | 8. NOTES PAYABLE Notes payable at May 31, 2016, and November 30, 2015, are comprised of the following: May 31, 2016 November 30, 2015 Notes payable to Studio Capital, LLC (a) $ 125,000 $ 125,000 Notes payable to Argent Offset, LLC (b) 6,575 16,825 Notes payable to Strategic IR, Inc. (c) 12,500 12,500 Notes payable to Lori Livingston (d) 105,000 - Notes payable to JLA Realty (e) 330,000 - Total notes payable 579,075 154,325 Less: debt discount (68,369 ) (19,294 ) Total notes payable $ 510,706 $ 135,031 During the three and six months ended May 31, 2016, the Company recognized interest expense of $35,947 and $81,912, respectively, resulting from amortization of the debt discount for the above notes payable. The Company did not recognize any interest expense from amortization of the debt discount during the three and six months ended May 31, 2015. The debt discount is being amortized as non-cash interest expense over the term of the debt using the effective interest method. The accrued interest associated with the above notes payable was $82,746 as of May 31, 2016, which is recorded in accrued interest on convertible and promissory notes payable on the accompanying condensed consolidated balance sheet. (a) On October 8, 2015, the Company entered into a promissory note agreement with Studio Capital, LLC, (“Studio Capital”) for an aggregate principal amount of $125,000 (the “Studio Capital Note”). The Studio Capital Note carries an original issue discount of $25,000, provided for a loan fee of 5,000 shares of the Company’s common stock and had a maturity date of April 8, 2016. The Studio Capital Note was not repaid on the maturity date and as such is in default as of May 31, 2016 and remains in default as of the date these financial statements are issued. The Company recorded in interest expense, including penalties, on the condensed statements of operations a one-time default penalty of $25,000 representing 20% of the outstanding principal balance of the Studio Capital Note. (b) On November 26, 2014, the Company entered into a promissory note agreement with Argent Offset, LLC (“Argent”) for an aggregate principal amount of $13,000 (the “Argent Note”). The Argent Note included a $500 loan fee, accrues interest at 10%, compounded monthly, and had a maturity date of December 5, 2014. On February 1, 2015, the Company entered into a Temporary Forbearance Agreement with Argent. Under the forbearance agreement, the Company agreed to pay a forbearance fee of $7,000 to extend the maturity date to August 1, 2015. Argent also advanced the Company an additional $19,825 pursuant to the terms of the Argent Note. During the six months ended May 31, 2016, the Company paid $10,250 on the Argent Note. As of November 30, 2016, all remaining amounts due had been repaid on the Argent Note. (c) On March 17, 2015, the Company entered into a promissory note agreement with Strategic, IR, Inc. (“Strategic”) for an aggregate principal amount of $12,500 (the “Strategic Note”). The Strategic Note included a $1,750 loan fee, accrued interest at 10% and had a maturity date of April 16, 2015. The Strategic Note is currently is in default as of May 31, 2016 and remains in default as of the date these financial statements are issued and is accruing interest at the default rate of 21% per annum. (d) On December 2, 2015, the Company entered into a promissory note agreement (the “Livingston Note”) with a third party for an aggregate principal amount of $125,000. The Livingston Note carries an original issue discount of $25,000. As additional consideration to the investor, the Company agreed to issue a warrant to purchase up to 100,000 shares of the Company’s common stock at a price of $0.01 per share. The Company recorded debt discount in the amount of $30,987 based on the fair value of the warrants. The Livingston Note is currently in default and accruing interest at the default rate of 29%. In January 2016, the Company recorded in interest expense a one-time default penalty of $25,000 representing 20% of the outstanding principal balance of the Livingston Note. (e) On April 7, 2016 and September 14, 2016, RCG entered into promissory note agreements with JLA Realty (the “JLA Notes”) for an aggregate amount of $480,000. The JLA Notes accrue interest at 16% per annum and have maturity dates of October 4, 2016 and March 14, 2017 and carry an original issue discount of $125,000. Between November 2016 and December 2016, the Company made payments of $150,000 on the JLA Notes and the remaining principal balance of $330,000 remains in default as of the date of these financial statements are issued. |
NOTE PAYABLE, RELATED PARTY
NOTE PAYABLE, RELATED PARTY | 6 Months Ended |
May 31, 2016 | |
Note Payable Related Party [Abstract] | |
NOTE PAYABLE, RELATED PARTY | 9. NOTE PAYABLE, RELATED PARTY Note payable, related party, at May 31, 2016 and November 30, 2015, are comprised of the following: May 31, 2016 November 30, 2015 Note payable to MCKEA Holdings, LLC $ 40,937 $ - Less: debt discount (2,800 ) - Total note payable, related party $ 38,137 $ - On March 4, 2016, RCG entered into a promissory note (the “MCKEA Note”) with MCKEA Holdings, LLC. The MCKEA Note provides for proceeds up to $100,000 and bears interest a rate of fifteen percent (15%) per year. All principal and interest accrued under the MCKEA Note was due on or before August 4, 2016. The MCKEA Note features an original issue discount of 10% of the total cash advanced to RCG. Between March 4, 2016 and May 31, 2016, $56,788 was advanced to RCG, inclusive of $5,163 of original issue discount of which $15,851 has been repaid resulting in an outstanding principal balance of $40,937 at May 31, 2016. During the three and six months ended May 31, 2016, the Company recognized interest expense of $2,363 resulting from amortization of the debt discount for the above note payable, related party. |
FAIR VALUE MEASUREMENTS
FAIR VALUE MEASUREMENTS | 6 Months Ended |
May 31, 2016 | |
Fair Value Disclosures [Abstract] | |
FAIR VALUE MEASUREMENTS | 10. FAIR VALUE MEASUREMENTS The following tables classify the Company’s embedded conversion options, put options, and derivative warrant liabilities measured at fair value on a recurring basis into the fair value hierarchy as of May 31, 2016 and November 30, 2015: Fair value measured at May 31, 2016 Fair value at May 31 2016 Quoted prices in active markets (Level 1) Significant other observable inputs (Level 2) Significant unobservable inputs (Level 3) Bifurcated conversion $ 1,588,104 $ - $ - $ 1,588,104 Fair value measured at November 30, 2015 Fair value at November 30, 2015 Quoted prices in active markets (Level 1) Significant other observable inputs (Level 2) Significant unobservable inputs (Level 3) Bifurcated conversion $ 1,313,012 $ - $ - $ 1,313,012 There were no transfers between Level 1, 2 or 3 during the six months ended May 31, 2016 and during the year ended November 30, 2015. The following table presents changes in Level 3 liabilities measured at fair value for the six months ended May 31, 2016. Both observable and unobservable inputs were used to determine the fair value of positions that the Company has classified within the Level 3 category. Unrealized gains and losses associated with liabilities within the Level 3 category include changes in fair value that were attributable to both observable (e.g., changes in market interest rates) and unobservable (e.g., changes in unobservable long-dated volatilities) inputs. December 1, 2015 Derivative Notes Payable Fair value at Change in estimated in May 31, 2016 Embedded conversion $ 1,313,012 $ 228,061 $ 57,237 ($ 10,206 ) $ 1,588,104 The development and determination of the unobservable inputs for Level 3 fair value measurements and fair value calculations are the responsibility of the Company’s management. The Company’s put options are valued using a using a Monte Carlo model or, in certain circumstances, the Black-Scholes option pricing model. As of May 31, 2016, the inputs used in the analysis included discount rates per the conversion terms of the convertible promissory notes. A summary of quantitative information about significant unobservable inputs (Level 3 inputs) used in measuring the Company’s embedded conversion options that are categorized within Level 3 of the fair value hierarchy for the six months ended May 31, 2016 and for the year ended November 30, 2015 is as follows: Date of valuation May 31, 2016 November 30, 2015 Stock price $ 0.25 $ 0.45 Conversion price $ .15 $0.10 – $0.22 Volatility 77.11 % 161% – 239% Risk free interest rate 1.03 % 0.11% – 0.86% Years to maturity 2.90 – 2.93 0.45 – 1.74 A summary of quantitative information about significant unobservable inputs (Level 3 inputs) used in measuring the Company’s derivative warrant liabilities that are categorized within Level 3 of the fair value hierarchy for the six months ended May 31, 2016: May 31, 2016 Stock price $ 0.25 Conversion price $0.001 – $0.30 Volatility 75.31% – 79.70% Risk free interest rate 0.68% – 1.03% Years to maturity 0.77 – 3.08 |
RELATED PARTY TRANSACTIONS
RELATED PARTY TRANSACTIONS | 6 Months Ended |
May 31, 2016 | |
Related Party Transactions [Abstract] | |
RELATED PARTY TRANSACTIONS | 11. RELATED PARTY TRANSACTIONS During the three and six months ended May 31, 2015, the Company sold $23,547 and $33,784 in products to Vape Nation. These sales represented 88% of total revenue for the six month period resulting in accounts receivable, related party of $17,222, which was paid in December 2016. Vape Nation, is 50% owned by MCKEA. MCKEA is the majority member of Philou Ventures, LLC (“Philou”), which is the Company’s controlling shareholder. Kristine L. Ault, the wife of Milton C. Ault III, Chairman of the Company’s Board of Directors, is the manager and owner of MCKEA. At February 29, 2016, the Company owed MCKEA $53,790, which was included in accounts payable and accrued expenses, related party. Of this amount, $25,000 was advanced directly by MCKEA to JST pursuant to the terms of the JST Note (see Note 6). The Company paid the amount owed MCKEA during the three months ended May 31, 2016. On May 1, 2016, the Company entered into a management services agreement (the “ MSA Alzamend |
EQUITY TRANSACTIONS
EQUITY TRANSACTIONS | 6 Months Ended |
May 31, 2016 | |
Equity [Abstract] | |
EQUITY TRANSACTIONS | 12. EQUITY TRANSACTIONS Preferred Stock The Company is authorized to issue 10,000,000 shares of Preferred Stock with a par value of $0.001 per share. On July 31, 2014, the Board of Directors designated 50,000 shares of its Preferred Stock as “Class A Convertible Preferred Stock” (the “Class A Preferred Stock”). Each share of Class A Preferred Stock has a stated value of $5.00 per share. The holders of Class A Preferred Stock have no voting rights. The holders are entitled to receive cumulative dividends at a rate of 10% of the stated value per annum, payable twice a year, subject to the availability of funds and approval by the Board of Directors. In the discretion of the Board of Directors, dividends may be paid with common stock. In the event of a liquidation or dissolution of the Company each holder of Class A Preferred Stock shall be entitled to be paid in cash $5 per share. At any time after August 31, 2015, a holder of Class A Preferred Stock may, at its option, convert all or a portion of its outstanding shares into common stock. Common Stock 2016 Transactions On December 10, 2015, the Company entered into a subscription agreement with a third party, whereby it sold 25,000 shares of its common stock at a price of $0.20 per share for total cash proceeds of $5,000. On January 26, 2016, the Company issued 50,000 fully vested and non-forfeitable shares of common stock to a third-party service provider of consulting services. The aggregate fair value of the shares amounted to $20,000 based on the closing price of the Company’s common stock on the issuance date. The related services were completed during the six months ended May 31, 2016. Conversion of debt 2016 Transactions On January 26, 2016, the Company issued 297,619 shares of common stock to Typenex Co-Investment, LLC in conversion of $12,500 of accrued interest. The shares of common stock were valued at $119,048 resulting in a loss on conversion of $106,548. On January 28, 2016, the Company issued 100,000 shares of common stock to Black Mountain Equities, Inc. in conversion of $12,830 of principal and accrued interest. The shares of common stock were valued at $40,000 resulting in a loss on conversion of $27,170. On January 29, 2016, the Company issued 60,000 shares of common stock to JMJ Investments, Inc in conversion of $3,024 of accrued interest. The shares of common stock were valued at $24,000 resulting in a loss on conversion of $20,976. Common Stock Warrants On December 2, 2015, in connection with issuing the Livingston Note (see Note 8d), the Company issued 100,000 common stock warrants which were valued at $30,987. In January 2016, in connection with an amendment to the LG Capital Funding, LLC Note (see Note 7f), the Company issued 75,000 common stock warrants, which were valued at $26,250. Stock based compensation During the three and six months ended May 31, 2016, the Company issued nil and 50,000 shares, respectively, of common stock to service providers. During the three and six months ended May 31, 2015, the Company issued 100,000 and 312,500 shares, respectively, of common stock to service providers. The shares of common stock are being expensed over the term of the services being provided. As a result of these issuances, the Company has recorded stock-based compensation during the three and six months ended May 31, 2016 of nil and $20,000, respectively. The Company recorded stock-based compensation during the three and six months ended May 31, 2015 of $100,000 and $251,833, respectively. The fair value of the shares was determined based on the closing price of the Company’s common stock on the issuance date and is being recognized over the term of the respective consulting agreement. |
SUBSEQUENT EVENTS
SUBSEQUENT EVENTS | 6 Months Ended |
May 31, 2016 | |
Subsequent Events [Abstract] | |
SUBSEQUENT EVENTS | 13. SUBSEQUENT EVENTS In accordance with ASC 855-10, the Company has analyzed its operations subsequent to May 31, 2016 through December 6, 2018, the date these financial statements were issued and has determined that there are no material subsequent events to disclose in these financial statements except for the following. Convertible Notes Payable On October 5, 2016, November 30, 2016, and February 22, 2017, the Company entered into three convertible promissory notes with DPW Holdings, Inc. (NYSE: DPW) (the “DPW Notes”), a related party. Under the terms of the DPW Notes, the Company borrowed the sum of $1,575,000. The DPW Notes featured an original issue discount of $75,000, resulting in net funding to the Company of $1,500,000. The DPW Notes were due in two years and accrued interest at 12% per annum. The DPW Notes, were convertible into shares of the Company’s common stock at a conversion price of $0.745 per share. On September 6, 2017, DPW Holdings, Inc. and the Company entered into a Loan and Security Agreement (the “Loan Agreement”) with an effective date of August 21, 2017 pursuant to which DPW will provide the Company a non-revolving credit facility of up to $10,000,000, for a period ending on August 21, 2019. In consideration of entering into the Loan Agreement, the DPW Notes were cancelled and the DPW Notes were consolidated and a new Convertible Promissory Note was issued (the “New DPW Note”). At December 3, 2018, DPW has provided loans to the Company in the principal amount $6,795,346 and, in addition to the 12% convertible promissory notes, the Company has issued to DPW warrants to purchase 13,590,692 shares of the Company’s common stock. The New DPW Note is due in two years and accrues interest at 12% per annum on the face amount. The New DPW Note contains standard events of defaults. Future advances under the Loan Agreement, if any, will be evidenced by a convertible promissory containing a conversion price feature at $0.50 per share and warrant with an exercise price of $0.50 per share. Further, under the terms of the Loan Agreement, the New DPW Notes are secured by the assets of Avalanche. Mr. Ault is the Chief Executive Officer and Chairman of the Board of Directors of DPW’s Board of Directors and the Chairman of the Company’s Board of Directors. Mr. William B. Horne is the Chief Financial Officer and a director of DPW and the Chief Financial Officer and a director of the Company Preferred Stock On March 6, 2017, the Company withdrew its former Class A Convertible Preferred Stock (the “ Previous Class On March 7, 2017, the Company filed a new Certificate of Designations, Preferences, Rights and Limitations of Class A Convertible Preferred Stock (the “Class A Certificate of Designations”) with the Secretary of State of the State of Nevada, setting forth the terms of the Class A Shares. The Class A Shares each carry a stated value of $20.00. The Class A Shares shall vote together with the shares of Common Stock as a single class and, regardless of the number of Class A Shares outstanding, provided that at least 25,000 of such Class A Shares are outstanding, shall represent eighty percent (80%) of all votes entitled to be voted at any annual or special meeting of shareholders of the Company or action by written consent of shareholders, including any shares of preferred stock other than the Class A Shares that are voted with the Common Stock. Each outstanding Class A Share shall represent its proportionate share of the 80% which is allocated to the outstanding Class A Shares. The Class A Shares are convertible at the Holder’s option into shares of Common Stock of the Company at a conversion price derived by dividing the stated value of each Class A Share by $0.50 per share, subject to customary adjustment, which conversion may occur at any time at the option of the Holder. On March 7, 2017, the Company entered into an agreement (the “Exchange Agreement”) with Philou pursuant to which it agreed to issue to Philou 50,000 shares of its newly created Class A Convertible Preferred Stock (the “Class A Shares”) and 5,000,000 common stock warrants in exchange for the surrender by Philou of 2,000,000 shares of its Common Stock. On April 26, 2017, the Class A Shares were issued simultaneously with the surrender and cancellation of the 2,000,000 shares of common stock. The warrants have a five year term and an exercise price of $0.35 per share. On March 7, 2017, the Company filed the Certificate of Designations, Preferences, Rights and Limitations of Class B Convertible Preferred Stock (the “Class B Certificate of Designations”) with the Secretary of State of the State of Nevada, setting forth the terms of its Class B Convertible Preferred Stock (the “Class B Shares”). The Company designated 100,000 shares of its preferred stock, par value $0.001 per share, as Class B Shares. The Class B Shares will have a priority over all of the shares of Common Stock on liquidation or sale of the Company, at the rate of $50.00 per Class B Share, or a liquidation preference of $5,000,000 (the “Class B Stated Value”) as to all Class B Shares. The Class B Shares will pay an annual dividend (at the option of the Company, either in cash or in additional shares of Common Stock), in an amount that shall be the greater of (i) an annual rate of 5% per annum, or (ii) 5% of MTIX’s net income as determined in accordance with United States Generally Accepted Accounting Principles for the fiscal year then ended. The Class B Shares will vote with the Common Stock on all matters as to which shareholders of the Company are entitled to vote, on an “as converted” basis, as though all outstanding Class B Shares had been converted into Common Stock immediately prior to the taking of the record date for all shareholders entitled to vote at any regular or special meeting of the Company’s shareholders. Commencing two (2) years after the Closing Date, the Class B Shares shall be convertible into shares of Common Stock by dividing the Class B Stated Value by the Conversion Price applicable to the Notes. The Class B Shares shall contain the respective rights, privileges and designations as are set forth in the Certificate of Designations, Preferences, Rights and Limitations of Class B Convertible Preferred Stock. Common Stock On February 28, 2017, the Company issued 250,000 shares of its common stock as payment for services to an officer. The shares were valued at $40,000, $0.16 per share. On March 9, 2017, the Company issued an aggregate of 216,946 shares of its common stock as repayment of the principal and accrued interest on the convertible note due to GCEF Opportunity Fund, LLC (See Note 7g). The shares had an aggregate fair value of $32,542, an average of $0.15 per share. On January 23, 2018, the Company, Adar Bays, LLC and Union Capital, LLC entered into Note Settlement and Termination Agreements. Pursuant to the terms of the settlement agreements, the Company agreed to satisfy each of the outstanding notes for $200,000 and 100,000 shares of common stock. The payments were made on January 26, 2018 (See Note 7a). On May 11, 2018, the Company issued an aggregate of 20,000 shares of its common stock as repayment of $4,550 in principal on the convertible note due to JMJ Financial (See Note 7d). The shares had an aggregate fair value of $4,550, an average of $0.23 per share. MTIX, Ltd. Acquisition On August 22, 2017, pursuant to the terms of a Share Exchange Agreement dated as of March 3, 2017, and as amended on July 13, 2017 and August 21, 2017 (the “Exchange Agreement”) with MTIX Limited, a company formed under the laws of England and Wales (“MTIX”) and the three (3) shareholders of MTIX (the “Sellers”), the Company completed its acquisition of MTIX. Upon the terms and subject to the conditions set forth in the Exchange Agreement, the Company acquired MTIX from the Sellers through the transfer of all issued and outstanding ordinary shares of MTIX (the “MTIX Shares”) by the Sellers to the Company in exchange (the “Exchange”) for the issuance by the Company of: (a) 7% secured convertible promissory notes (individually, a “Note” and collectively, the “Notes”) in the aggregate principal face amount of $9,500,000 to the Sellers in pro rata amounts commensurate with their current respective ownership percentages of MTIX’s ordinary shares, (b) (i) $500,000 in cash, $50,000 of which was paid on October 26, 2016, and (ii) 100,000 shares of the Company’s newly designated shares of Class B Shares to the principal shareholder of MTIX (the “Majority Shareholder”). At the Closing the Company delivered to the Majority Shareholder and the two Sellers other than Majority Shareholder (the “Minority Shareholders”) three Notes, which Notes were in the principal face amount of $6,166,666 with respect to the Majority Shareholder and in the principal face amount of $1,666,667 with respect to each of the Minority Shareholders. The Notes The Notes bear interest at 7% per annum with interest payable (i) in cash upon maturity or in connection with any voluntary or mandatory conversion or, (ii) at the option of the Seller, in arrears on the first day of each calendar quarter after the date of issuance (the “Closing Date” ) by issuing and delivering that number of shares of Common Stock determined by dividing the interest accrued for such quarter by the average price per share for the ten (10) trading days immediately preceding the determination date as reported by Bloomberg, L.P. Commencing two (2) years from the Closing Date, the Company may prepay any portion of the principal amount of the Notes without the prior written consent of the holders, provided, however, that the Company shall provide the Sellers with 90 days’ notice of such prepayment, and any prepayment must be undertaken on a pro rata basis for all Notes then outstanding. The holders of Notes shall have the right to convert any or all of the amount to be redeemed into common stock prior to prepayment. Each Note ranks pari passu in right of payment with all other Notes now or hereafter issued in accordance with the Exchange Agreement and matures on the five-year anniversary of the issuance date thereof. Subject to certain limitations, the Notes are convertible at any time at the option of the holder into shares of the Company’s common stock at a conversion price equal to either (i) if the aggregate market capital of the Company on the date of conversion (the “Market Cap”) is $35,000,000 or less, at a 25% discount to the Market Price, or (ii) if the Market Cap is greater than $35,000,000, at a 25% discount to the Market Price, provided that such discount shall be increased by dividing it by the quotient that shall be obtained by dividing $35,0000,000 by the Market Cap at the time of conversion, provided, however, any increase in the discount to the Market Price shall not result in a discount that is greater than a 75% discount (the “Conversion Price”). Notwithstanding the foregoing, in no event shall the Conversion Price be less than $0.35. In addition, the Company may force the conversion of the Notes at any time commencing two (2) years from the Closing Date, provided certain conditions are met. Security Agreement The Notes are secured, pursuant to a Security Agreement, by a lien on certain of the Company’s assets, including but not limited to the intellectual property of MTIX. Upon the occurrence of an event of default under the Notes, a majority in interest of the Notes may require the Company to repay all of its Notes in cash, at a price equal to 100% of the principal, accrued and unpaid interest and any amounts, costs and liquidated damages, as applicable. Registration Rights Agreement In connection with the Exchange, the Company and the Sellers entered into a Registration Rights Agreement under which the Company shall be required to file a registration statement with the Commission covering the resale of the shares of the Common Stock issuable pursuant to conversion of: (i) the Notes eighteen (18) months from the Closing Date, and (ii) the Class B Shares twenty-four (24) months from the Closing Date. In addition, the Company use its best efforts to have the registration statement declared effective as soon as practicable, but in no event later than 90 days after the filing date if the registration statement is not subject to a full review by the Commission, or 120 days after filing if the registration statement is subject to a full review by the Commission. The Company will be subject to certain monetary penalties, as set forth in the Registration Rights Agreement, if the registration statement is not filed, does not become effective on a timely basis, or does not remain available for the resale (subject to certain allowable grace periods) of the Registrable Securities, as such term is defined in the Registration Rights Agreement. MTIX, Ltd. Exchange Agreement On December 5, 2017, DPW entered into an exchange agreement with WT Johnson & Sons (Huddersfield) Limited (the “WT Johnson”), pursuant to which the Company issued to the WT Johnson, (a) a convertible promissory note in the principal amount of $600,000 (“Note A”), and (b) a convertible promissory note in the principal amount of $1,667,766 (“Note B”), in exchange for cancellation of (i) an outstanding loan made by WT Johnson to MTIX in the amount of $265,666; and (ii) cancellation of an aggregate of $2,002,500 owed by MTIX to WT Johnson pursuant to an Agreement for the Sale and Purchase of a Textile Multi-Laser Enhancement Technology Machine dated as of July 21, 2017 by and between MTIX and WT Johnson. Note A was convertible into DPW’s common stock at a conversion price of $1.00 per share, does not bear interest, and matured two years from issuance. Note B was convertible into DPW’s common stock at a conversion price of $0.85 per share, does not bear interest, and matured two years from issuance. However, WT Johnson did not have the right to convert any portion of Note B, following receipt by WT Johnson of an aggregate of $2,267,766 of gross proceeds from the sale of shares of common stock issued upon conversion of Note A or Note B. During December 2017, DPW issued 600,000 shares of its common stock upon the conversion of Note A and WT Johnson notified DPW that gross proceeds during the month of December 2017 from sales of the 600,000 shares of common stock were sufficient to satisfy the entire $2,267,766 obligation. As a result of entering into the exchange agreement with WT Johnson, MTIX is obligated to pay DPW $2,668,266, consisting of the amount of the exchange agreement of $2,267,766 and a value added tax of $400,500 from the sale of the Textile Multi-Laser Enhancement Technology Machine. Concurrent with entering into the exchange agreement, MTIX issued a promissory note in the amount of $2,668,266 to DPW and Note B was cancelled. Philo Group, LLC Note Receivable Between June 2016 to November 2017, the Company provided $947,092 in financing to Philo under the terms of a Senior Secured Property Note dated April 4, 2016, as amended (the “Philo Note”). The Philo Note bears interest at a rate of sixteen percent (16%) per year, requires monthly interest payments, and was due within six (6) months from the date of issue. Stock Incentive Plan On October 27, 2016, subject to stockholder approval, the Company’s Board of Directors approved the Company’s 2016 Stock Incentive Plan (the ”Plan”), which provides for the issuance of a maximum of three million (3,000,000) shares of the Company’s common stock to be offered to the Company’s directors, officers, employees, and consultants. Options granted under the Plan will have an exercise price equal to or greater than the fair market value of the underlying common stock at the date of grant and become exercisable based on a vesting schedule determined at the date of grant. The options will expire between 5 and 10 years from the date of grant. Restricted stock awards granted under the Plan are subject to a vesting period determined at the date of grant. On October 27, 2016, the Company’s Board of Directors granted incentive stock option awards for 1,000,000 shares of common stock to each of the Company’s Chairman, President and Chief Executive Officer and Chief Financial Officer (collectively, the “Stock Option Grants”). The Stock Option Grants were issued pursuant to the Plan. Upon obtaining stockholder approval for the Plan an accounting grant date will be established. The Stock Option Grants have an exercise price of $0.16 and are exercisable for seven years. The Stock Option Grants will initially vest equally in annual tranches over a three (3) year period beginning on October 27, 2017. Upon closing of the acquisition of MTIX, the vesting terms of the options change and will vest 50% upon closing and 50% one year after closing. |
SUMMARY OF SIGNIFICANT ACCOUN_2
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Policies) | 6 Months Ended |
May 31, 2016 | |
Accounting Policies [Abstract] | |
Basis of Presentation | Basis of Presentation The accompanying unaudited condensed consolidated financial statements have been prepared in accordance with the instructions to Securities and Exchange Commission (the “SEC”) Form 10-Q and Article 8 of SEC Regulation S-X and do not include all the information and disclosures required by generally accepted accounting principles in the United States of America ( “GAAP” |
Principles of Consolidation | Principles of Consolidation The unaudited condensed consolidated financial statements include accounts of Avalanche and its wholly-owned subsidiaries, SRB and RCG (collectively referred to as the “Company” |
Accounting Estimates | Accounting Estimates The preparation of financial statements, in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. The Company’s critical accounting policies that involve significant judgment and estimates include fair value of bifurcated embedded conversion options and derivative warrant liabilities and the valuation of deferred income taxes. Actual results could differ from those estimates. |
Fair Value of Financial Instruments | Fair Value of Financial Instruments The Company’s significant financial instruments include cash, accounts receivable, notes receivable, accounts payable and accrued expenses, notes payable, and convertible notes payable. The recorded values of cash, accounts receivable, notes receivable, and accounts payable approximate their fair values based on their short-term nature. Notes payable and convertible notes payable are recorded inclusive of the value of any bifurcated embedded feature, which approximates their fair value. |
Equity-Linked Financial Instruments | Equity-Linked Financial Instruments Derivative liabilities are recognized in the consolidated balance sheets at fair value based on the criteria specified in Financial Accounting Standards Board ( “FASB” “ASC” – Derivatives and Hedging – Embedded Derivatives “ASC 815-15” Pursuant to ASC Topic 815-15 an evaluation of the embedded conversion feature of convertible debt is evaluated to determine if the embedded debt conversion feature is required to be bifurcated from the debt instrument, valued and classified with the related loan host instrument. When the terms of the embedded conversion features of the Company’s convertible debt provides for the issuance of shares of common stock at the election of the holders and the number of shares is subject to adjustment for a decline in the price of the Company’s common stock, the Company determined that the embedded conversion option should be bifurcated. The estimated fair value of the conversion features, when bifurcated, are primarily determined using a Monte Carlo model or, in certain circumstances, the Black-Scholes option pricing model. The models utilize Level 3 unobservable inputs to calculate the fair value of the derivative liabilities at each reporting period. The Company determined that in instances where a Black-Scholes option pricing model was used that using an alternative valuation model such as a Monte Carlo model would result in minimal differences. Each reporting period the embedded conversion feature for each applicable debt instrument is re-valued and adjusted through the caption “change in fair value of derivative liability” on the consolidated statements of operations. Certain of the Company’s convertible notes issued during the year ended November 30, 2015 contain conversion terms that provide for a variable conversion price (e.g. 55% of the lowest trading price of the Company’s common stock for the 25 days preceding conversion) for a fixed amount (i.e. face value of the note). This results in the number of shares to be issued upon conversion to be essentially indeterminable and prevents the Company from concluding that the related conversion feature does not need to be bifurcated as a derivate liability in accordance with ASC 815. Thus, equity-linked financial instruments, which are convertible or exercisable into common stock, issued subsequent to the convertible notes are classified as derivative liabilities, with the exception of instruments related to employee share-based compensation. |
Warrant Liability | Warrant Liability The Company accounts for certain common stock warrants outstanding as a liability at fair value and adjusts the instruments to fair value at each reporting period. This liability is subject to re-measurement at each balance sheet date until exercised, and any change in fair value is recognized in the Company's consolidated statements of operations. The fair value of the warrants issued by the Company has been estimated using a Black-Scholes option pricing model, at each measurement date. |
Debt Discounts | Debt Discounts The Company accounts for debt discounts originating in connection with conversion features that remain embedded in the related notes in accordance with ASC 470-20, Debt with Conversion and Other Options |
Sequencing | Sequencing As of March 1, 2016, the Company adopted a sequencing policy whereby all future instruments may be classified as a derivative liability with the exception of instruments related to share-based compensation issued to employees or directors. |
Revenue Recognition | Revenue Recognition The Company recognizes revenue when it is realized or realizable and earned. The Company considers revenue realized or realizable and earned when all of the following criteria are met: (i) persuasive evidence of an arrangement exists, (ii) the product has been shipped or the services have been rendered to the customer, (iii) the sales price is fixed or determinable, and (iv) collectability is reasonably assured. No revenue was recorded during the three and six months ended May 31, 2016. During the three and six months ended May 31, 2016, the Company’s revenues consisted solely of sales of flavored liquids for electronic vaporizers and eCigarettes and accessories from SRB. |
Loss per Common Share | Loss per Common Share Pursuant to ASC Topic No. 260, Earnings per Share, Since the effects of the conversion of convertible debt are anti-dilutive in all periods presented, shares of common stock underlying these instruments have been excluded from the computation of loss per common share. The following sets forth the number of shares of common stock underlying convertible debt as of May 31, 2016 and 2015: May 31, 2016 2015 Convertible notes payable 11,449,546 604,167 Common stock warrants 175,000 - 11,624,546 604,167 |
Reclassifications | Reclassifications Certain prior period amounts have been reclassified for comparative purposes to conform to the current period financial statement presentation. These reclassifications had no effect on previously reported results of operations. In addition, certain prior period amounts from the revised amounts have been reclassified for consistency with the current period presentation. |
Recent Accounting Pronouncements | Recent Accounting Pronouncements The Company has considered all recently issued accounting pronouncements and does not believe the adoption of such pronouncements will have a material impact on its condensed consolidated financial statements. |
SUMMARY OF SIGNIFICANT ACCOUN_3
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Tables) | 6 Months Ended |
May 31, 2016 | |
Accounting Policies [Abstract] | |
Schedule of common stock underlying convertible debt | The following sets forth the number of shares of common stock underlying convertible debt as of May 31, 2016 and 2015: May 31, 2016 2015 Convertible notes payable 11,449,546 604,167 Common stock warrants 175,000 - 11,624,546 604,167 |
REVISION OF PREVIOUSLY ISSUED_2
REVISION OF PREVIOUSLY ISSUED FINANCIAL STATEMENTS (Tables) | 6 Months Ended |
May 31, 2016 | |
Revision Of Previously Issued Financial Statements | |
Schedule of condensed consolidated balance sheet | The condensed consolidated financial statements for the three and six months ended May 31, 2015 have been revised to expense the previously capitalized licensing fee and to reclassify original issue discount that was initially recorded as a prepaid asset to debt discount. An analysis of those revised numbers is reflected below. Condensed Consolidated Balance Sheet (unaudited) May 31, 2015 As reported Adjustment As revised Assets: Total current assets $ 356,883 $ - $ 356,883 Total assets $ 411,588 $ (54,000 ) $ 357,588 Liabilities and Stockholders' Deficit: Total current liabilities $ 687,772 $ - $ 687,772 Total liabilities and stockholders' deficit $ 411,588 $ (54,000 ) $ 357,588 |
Schedule of condensed consolidated statement of operations | Condensed Consolidated Statement of Operations (unaudited) For the Three Months Ended May 31, 2015 As reported Adjustment As revised General and administrative expenses $ 301,755 $ 11,250 $ 313,005 Loss from operations $ (298,846 ) $ (11,250 ) $ (310,096 ) Net loss $ (570,226 ) $ (11,250 ) $ (581,476 ) Basic and diluted net loss per share $ (0.10 ) $ (0.00 ) $ (0.11 ) Weighted average shares outstanding, basic and diluted 5,451,384 5,451,384 5,451,384 Condensed Consolidated Statement of Operations (unaudited) For the Six Months Ended May 31, 2015 As reported Adjustment As revised General and administrative expenses $ 475,085 $ 24,750 $ 499,835 Loss from operations $ (465,715 ) $ (24,750 ) $ (490,465 ) Net loss $ (748,295 ) $ (24,750 ) $ (773,045 ) Basic and diluted net loss per share $ (0.14 ) $ (0.00 ) $ (0.14 ) Weighted average shares outstanding, basic and diluted 5,336,296 5,336,296 5,336,296 |
WARRANTS (Tables)
WARRANTS (Tables) | 6 Months Ended |
May 31, 2016 | |
Warrants | |
Schedule of common stock warrants outstanding | The following table summarizes information about common stock warrants outstanding at May 31, 2016: Outstanding Exercisable Weighted Average Weighted Weighted Remaining Average Average Exercise Number Contractual Exercise Number Exercise Price Outstanding Life (Years) Price Exercisable Price $0.01 100,000 0.51 $0.01 100,000 $0.01 $0.30 75,000 2.64 $0.30 75,00 $0.30 $0.01 - $0.30 175,000 1.42 $0.13 175,000 $0.13 |
Schedule of weighted average assumptions | The following weighted average assumptions were used for grants during the six months ended May 31, 2016: May 31, 2016 Weighted average risk-free interest rate 0.52% Weighted average life (in years) 2.0 Volatility 167.9% — 184.9% Expected dividend yield 0% Weighted average grant-date fair value per $ 0.41 |
NOTES RECEIVABLE (Tables)
NOTES RECEIVABLE (Tables) | 6 Months Ended |
May 31, 2016 | |
Receivables [Abstract] | |
Schedule of note receivables | May 31, 2016 Notes receivable - Philo Group $ 325,000 Notes receivable - JS Technologies, Inc. 103,659 Total notes receivable 428,659 Less: original issue discount (53,159 ) Total notes receivable, net $ 375,500 Less: current portion (103,659 ) Notes receivable – long-term portion $ 271,841 |
CONVERTIBLE NOTES PAYBLE (Table
CONVERTIBLE NOTES PAYBLE (Tables) | 6 Months Ended |
May 31, 2016 | |
Debt Disclosure [Abstract] | |
Schedule of convertible notes payable | May 31, 2016 November 30, 2015 Adar Bays, LLC Note (a): Principal value $ 115,000 $ 115,000 Fair value of bifurcated put option of Adar Bays, LLC Note 186,694 207,659 Debt discount - (40,411 ) Carrying amount of Adar Bays, LLC Note 301,394 282,248 Union Capital, LLC Note (a): Principal value 115,000 115,000 Fair value of bifurcated put option of Union Capital, LLC Note 186,611 207,536 Debt discount - (40,096 ) Carrying amount of Union Capital, LLC Note 301,611 282,440 Typenex Co-Investement, LLC Note (b): Principal value 87,500 87,500 Fair value of bifurcated put option of Typenex Co-Investement, LLC Note 373,733 380,858 Debt discount (153 ) (28,130 ) Carrying amount of Typenex Co-Investement, LLC Note 461,080 440,228 Gary Gelbfish Note (c): Principal value 100,000 100,000 Fair value of bifurcated put option of Gary Gelbfish Note 203,030 118,391 Debt discount - - Carrying amount of Gary Gelbfish Note 303,030 218,391 JMJ Financial Note (d): Principal value 60,500 60,500 Fair value of bifurcated put option of JMJ Financial Note 212,973 155,017 Debt discount (30,160 ) (44,576 ) Carrying amount of JMJ Financial Note 243,313 170,941 Black Mountain Equities, Inc. Note (e): Principal value 42,670 55,000 Fair value of bifurcated put option of Black Mountain Equities, Inc. Note 57,516 81,951 Debt discount (453 ) (28,028 ) Carrying amount of Black Mountain Equities, Inc. Note 99,733 108,923 LG Capital Funding, LLC Note (f): Principal value 50,000 50,000 Fair value of bifurcated put option of LG Capital Funding, LLC Note 76,462 94,905 Debt discount - - Carrying amount of LG Capital Funding, LLC Note 126,462 144,905 GCEF Opportunitity Fund, LLC Note (g): Principal value 27,500 27,500 Fair value of bifurcated put option of GCEF Opportunity Fund, LLC Note 39,809 50,532 Debt discount (2,185 ) (15,973 ) Carrying amount of GCEF Opportunitity Fund, LLC Note 65,124 62,059 Lord Abstract, LLC Note (h): Principal value 8,800 8,800 Fair value of bifurcated put option of Lord Abstract, LLC Note 18,186 16,163 Debt discount (699 ) (5,111 ) Carrying amount of Lord Abstract LLC Note 26,287 19,852 JLA Realty Notes (i): Principal value 160,600 - Fair value of bifurcated conversion option of JLA Realty Notes 166,930 - Debt discount (156,451 ) - Carrying amount of JLA Realty Notes 171,079 - Other convertible notes payable (j): Principal value 11,000 - Fair value of bifurcated put option of other convertible notes payable 23,206 - Debt discount (9,232 ) - Carrying amount of other convertible notes payable 34,974 - Total carrying amount of convertible notes $ 2,134,387 $ 1,729,987 Total short-term carrying amount of convertible notes $ 1,928,334 $ - Total long-term carrying amount of convertible notes $ 206,053 $ - Total convertible notes payable: Principal value $ 778,570 $ 619,300 Fair value of bifurcated put option of other convertible notes payable 1,555,150 1,313,012 Debt discount (199,333 ) (202,325 ) Carrying amount of other convertible notes payable $ 2,134,387 $ 1,729,987 (a) The Adar Bays, LLC and Union Capital, LLC convertible notes payable were due and payable 12 months after issuance date of May 11, 2015 and bore interest at 8% per annum. At the election of the holder, outstanding principal and accrued but unpaid interest under the notes were convertible into shares of the Company’s common stock at any time prior to maturity at a conversion price per share equal to a forty percent (40%) discount to the lowest trading price for the twenty (20) consecutive trading days immediately preceding the notice of conversion. If these notes were not paid at maturity, the outstanding principal due under these notes shall increase by 10%. In January 2016, the notes were amended to decrease the conversion price per share equal to a forty-five percent (45%) discount to the lowest trading price for the twenty-five (25) consecutive trading days immediately preceding the notice of conversion, and the pre-payment penalty was increased to 150%. The amendments did not result in a material change to the fair value of the notes. The notes were not repaid on the maturity date of May 12, 2016 and as such were in default as of May 31, 2016. The Company recorded in interest expense, including penalties, on the condensed statements of operations a one-time default penalty of $23,000 representing 10% of the outstanding principal balance of the Notes. As of May 31, 2016, there were 1,916,667 shares issuable upon conversion for each note. On January 23, 2018, the Company, Adar Bays, LLC and Union Capital, LLC entered into Note Settlement and Termination Agreements. Pursuant to the terms of the settlement agreements, the Company agreed to satisfy each of the outstanding notes for $200,000 and 100,000 shares of common stock. The payments were made on January 26, 2018. The closing price of the Company's common stock on January 23, 2018 was $1.40 per share resulting in an aggregate value of $340,000 per note. (b) The Typenex Co-Investment, LLC convertible note payable is due and payable 13 months after issuance date of May 29, 2015 and bears interest at 10% per annum. At the election of the holder, outstanding principal and accrued but unpaid interest under the note are convertible into shares of the Company’s common stock at any time prior to maturity at a conversion price per share equal to $1.30. However, in the event the Company’s market capitalization falls below $3.0 million at any time, the conversion price per share shall be equal to the lower of $1.30 or the market price at the date of conversion. The note was not repaid on the maturity date of June 29, 2016 and was also in default of certain conditions of the note as of May 31, 2016. The Company recorded in interest expense, including penalties, on the condensed statements of operations a one-time default penalty of approximately $18,200. As of May 31, 2016, there were 2,966,548 shares issuable upon conversion of this note. On or around April 19, 2016, the Company received from counsel for Typenex, a written demand to accelerate and demand payment of the entire outstanding balance of the Typenex note entered into between the Company and Typenex on May 29, 2015. On June 7, 2016, Typenex filed suit in the State of Utah, the Third Judicial District Court, County of Salt Lake, for repayment of all principal, default effects, late fee and accrued interest. According to the complaint, Typenex asserted an aggregate amount due, as of June 6, 2016, of $149,054. On April 4, 2017, the Company and Typenex agreed to settle the lawsuit for payment of $90,000, which was paid in April 2017. On May 9, 2017, an order of dismissal with prejudice was entered by the Third Judicial District Court. (c) The Gary Gelbfish convertible note payable was due and payable six months after the issuance date of March 27, 2015 and bore interest at 10% per annum. If this note was not paid at maturity, at the election of the holder, outstanding principal and accrued but unpaid interest under the note was convertible into shares of the Company’s common stock at a conversion price per share equal to lesser of: (i) fifty percent (50%) discount to the average closing price for the twenty (20) consecutive trading days immediately preceding the maturity date or (ii) $0.50 per share. The note was not repaid on the maturity date of September 23, 2015 and as such was in default as of May 31, 2016 and remains in default as of the date of this report. As of May 31, 2016, there were 767,754 shares issuable upon conversion of this note. (d) The JMJ Financial convertible note payable is due and payable 24 months after issuance date of April 29, 2015 and bears interest at 12% per annum. At the election of the holder, outstanding principal and accrued but unpaid interest under the notes are convertible into shares of the Company’s common stock at any time prior to maturity at a conversion price per share equal to a forty percent (40%) discount to the lowest trading price for the twenty-five (25) consecutive trading days immediately preceding the notice of conversion. As of May 31, 2016, there were 875,000 shares issuable upon conversion of this note. Between May 2018 and July 2018, the Company made payments of $35,000 on this note and the remaining principal balance of $25,500 remains in default as of the date of this report. (e) The Black Mountain Equities, Inc. convertible note payable is due and payable 12 months after issuance date of June 4, 2015 and bears interest at 10% per annum. At the election of the holder, outstanding principal and accrued but unpaid interest under the note is convertible into shares of the Company’s common stock at any time prior to maturity at a conversion price per share equal to the lesser of: (i) forty percent (40%) discount to the lowest trading price for the twenty-five (25) consecutive trading days immediately preceding the notice of conversion or (ii) $1.06 per share. As of May 31, 2016, there were 627,024 shares issuable upon conversion of this note. The Note was not repaid on the maturity date of June 4, 2016 and remains in default as of the date of this report. (f) The LG Capital Funding, LLC convertible note payable was due and payable 13 months after issuance date of November 3, 2014 and bore interest at 8% per annum. At the election of the holder, outstanding principal and accrued but unpaid interest under the note were convertible into shares of the Company’s common stock, at any time after 180 days from the date of issuance, at a conversion price per share equal to a forty percent (40%) discount to the lowest trading price for the twenty (20) consecutive trading days immediately preceding the notice of conversion. In January, 2016, the note was amended to grant LG Capital 75,000 warrants with an exercise price of $0.30 per share, and to permit the Company to re-pay the LG Capital Note with a pre-payment penalty of 120%. The amendment did not result in a material change to the fair value of the note. The fair value of the warrants was $26,250, which was expensed at the time of issuance due to the short-term nature of the note. The note was not repaid on the maturity date and as such is in default as of May 31, 2016 and as of the date of this report. Upon default, the note accrues interest at 24% per annum. As of May 31, 2016, there were 694,444 shares issuable upon conversion of this note. (g) The GCEF Opportunity Fund, LLC convertible note payable is due and payable 12 months after issuance date of June 30, 2015 and bears interest at 10% per annum. At the election of the holder, outstanding principal and accrued but unpaid interest under the note are convertible into shares of the Company’s common stock, at any time after 30 days from the date of issuance, at a conversion price per share equal to the lower of: (i) a forty percent (40%) discount to the lowest closing price for the twenty (20) consecutive trading days immediately preceding the notice of conversion or (ii) $1.00. If this note is not paid at maturity, then the interest rate shall increase to 24% thereafter. As of May 31, 2016, there were 381,944 shares issuable upon conversion of this note. On March 9, 2017, the Company issued an aggregate of 216,946 shares of its common stock as full repayment of the principal and accrued interest on the note. (h) The Lord Abstract, LLC convertible note payable is due and payable 12 months after issuance date of June 30, 2015 and bears interest at 10% per annum. At the election of the holder, outstanding principal and accrued but unpaid interest under the note are convertible into shares of the Company’s common stock, at any time after 30 days from the date of issuance, at a conversion price per share equal to a forty percent (40%) discount to the lowest closing price for the twenty (20) consecutive trading days immediately preceding the notice of conversion. If this note is not paid at maturity, then the interest rate shall increase to 24% thereafter. As of May 31, 2016, there were 122,222 shares issuable upon conversion of this note. Between June 2016 and August 2016, the Company made payments of $7,500 on this note and the remaining principal balance of $1,300 remains in default as of the date of this report. (i) The JLA Realty convertible note payable is due and payable 36 months after proceeds have been received by the Company, which occurred between April 25, 2016 and May 4, 2016 and bears interest at 12% per annum. At the election of the holder, outstanding principal and accrued but unpaid interest under the note is convertible into shares of the Company’s common stock at any time prior to maturity at a fixed price per share equal to $0.15. In connection with the issuance of the JLA Realty note described above, the Company recognized a debt discount of $146,000 and a loss on issuance of $68,522 during the three months ended May 31, 2016, which represents the excess of the fair value of the bifurcated conversion feature at initial issuance of approximately $215,000 over the principal amount of convertible debt issued. The fair value of the bifurcated conversion feature is separately measured at fair value, with changes in fair value recognized in operations. During the three and six months ended May 31, 2016, the Company recognized interest expense of $4,151 resulting from amortization of the debt discount for the JLA Realty note. As of May 31, 2016, the bifurcated conversion option has a fair value of $166,930 and is presented on a combined basis with the related loan host in the Company’s Condensed Consolidated Balance Sheet at May 31, 2016. As of May 31, 2016, there were 1,070,607 shares issuable upon conversion of this note. (j) The other convertible notes payable are due and payable 36 months after issuance and bear interest at 10% per annum. At the election of the holder, outstanding principal and accrued but unpaid interest under the note are convertible into shares of the Company’s common stock, at any time after six months from the date of issuance, at a conversion price per share equal the lesser of: (i) fifty percent (50%) discount to the volume weighted average price over the twenty (20) consecutive trading days immediately preceding the notice of conversion. As of May 31, 2016, there were 110,609 shares issuable upon conversion of these notes. |
NOTES PAYABLE (Tables)
NOTES PAYABLE (Tables) | 6 Months Ended |
May 31, 2016 | |
Notes Payable [Abstract] | |
Schedule of short term notes payable | Notes payable at May 31, 2016, and November 30, 2015, are comprised of the following: May 31, 2016 November 30, 2015 Notes payable to Studio Capital, LLC (a) $ 125,000 $ 125,000 Notes payable to Argent Offset, LLC (b) 6,575 16,825 Notes payable to Strategic IR, Inc. (c) 12,500 12,500 Notes payable to Lori Livingston (d) 105,000 - Notes payable to JLA Realty (e) 330,000 - Total notes payable 579,075 154,325 Less: debt discount (68,369 ) (19,294 ) Total notes payable $ 510,706 $ 135,031 (a) On October 8, 2015, the Company entered into a promissory note agreement with Studio Capital, LLC, (“Studio Capital”) for an aggregate principal amount of $125,000 (the “Studio Capital Note”). The Studio Capital Note carries an original issue discount of $25,000, provided for a loan fee of 5,000 shares of the Company’s common stock and had a maturity date of April 8, 2016. The Studio Capital Note was not repaid on the maturity date and as such is in default as of May 31, 2016 and remains in default as of the date these financial statements are issued. The Company recorded in interest expense, including penalties, on the condensed statements of operations a one-time default penalty of $25,000 representing 20% of the outstanding principal balance of the Studio Capital Note. (b) On November 26, 2014, the Company entered into a promissory note agreement with Argent Offset, LLC (“Argent”) for an aggregate principal amount of $13,000 (the “Argent Note”). The Argent Note included a $500 loan fee, accrues interest at 10%, compounded monthly, and had a maturity date of December 5, 2014. On February 1, 2015, the Company entered into a Temporary Forbearance Agreement with Argent. Under the forbearance agreement, the Company agreed to pay a forbearance fee of $7,000 to extend the maturity date to August 1, 2015. Argent also advanced the Company an additional $19,825 pursuant to the terms of the Argent Note. During the six months ended May 31, 2016, the Company paid $10,250 on the Argent Note. As of November 30, 2016, all remaining amounts due had been repaid on the Argent Note. (c) On March 17, 2015, the Company entered into a promissory note agreement with Strategic, IR, Inc. (“Strategic”) for an aggregate principal amount of $12,500 (the “Strategic Note”). The Strategic Note included a $1,750 loan fee, accrued interest at 10% and had a maturity date of April 16, 2015. The Strategic Note is currently is in default as of May 31, 2016 and remains in default as of the date these financial statements are issued and is accruing interest at the default rate of 21% per annum. (d) On December 2, 2015, the Company entered into a promissory note agreement (the “Livingston Note”) with a third party for an aggregate principal amount of $125,000. The Livingston Note carries an original issue discount of $25,000. As additional consideration to the investor, the Company agreed to issue a warrant to purchase up to 100,000 shares of the Company’s common stock at a price of $0.01 per share. The Company recorded debt discount in the amount of $30,987 based on the fair value of the warrants. The Livingston Note is currently in default and accruing interest at the default rate of 29%. In January 2016, the Company recorded in interest expense a one-time default penalty of $25,000 representing 20% of the outstanding principal balance of the Livingston Note. (e) On April 7, 2016 and September 14, 2016, RCG entered into promissory note agreements with JLA Realty (the “JLA Notes”) for an aggregate amount of $480,000. The JLA Notes accrue interest at 16% per annum and have maturity dates of October 4, 2016 and March 14, 2017 and carry an original issue discount of $125,000. Between November 2016 and December 2016, the Company made payments of $150,000 on the JLA Notes and the remaining principal balance of $330,000 remains in default as of the date of these financial statements are issued. |
NOTE PAYABLE, RELATED PARTY (Ta
NOTE PAYABLE, RELATED PARTY (Tables) | 6 Months Ended |
May 31, 2016 | |
Note Payable Related Party [Abstract] | |
Schedule of note payable, related party | Note payable, related party, at May 31, 2016 and November 30, 2015, are comprised of the following: May 31, 2016 November 30, 2015 Note payable to MCKEA Holdings, LLC $ 40,937 $ - Less: debt discount (2,800 ) - Total note payable, related party $ 38,137 $ - |
FAIR VALUE MEASUREMENTS (Tables
FAIR VALUE MEASUREMENTS (Tables) | 6 Months Ended |
May 31, 2016 | |
Fair Value Disclosures [Abstract] | |
Schedule of fair value of liabilities | The following tables classify the Company’s embedded conversion options, put options, and derivative warrant liabilities measured at fair value on a recurring basis into the fair value hierarchy as of May 31, 2016 and November 30, 2015: Fair value measured at May 31, 2016 Fair value at May 31 2016 Quoted prices in active markets (Level 1) Significant other observable inputs (Level 2) Significant unobservable inputs (Level 3) Bifurcated conversion $ 1,588,104 $ - $ - $ 1,588,104 Fair value measured at November 30, 2015 Fair value at November 30, 2015 Quoted prices in active markets (Level 1) Significant other observable inputs (Level 2) Significant unobservable inputs (Level 3) Bifurcated conversion $ 1,313,012 $ - $ - $ 1,313,012 |
Schedule of fair value liabilities gains & losses | The following table presents changes in Level 3 liabilities measured at fair value for the six months ended May 31, 2016. Both observable and unobservable inputs were used to determine the fair value of positions that the Company has classified within the Level 3 category. Unrealized gains and losses associated with liabilities within the Level 3 category include changes in fair value that were attributable to both observable (e.g., changes in market interest rates) and unobservable (e.g., changes in unobservable long-dated volatilities) inputs. December 1, 2015 Derivative Notes Payable Fair value at Change in estimated in May 31, 2016 Embedded conversion $ 1,313,012 $ 228,061 $ 57,237 ($ 10,206 ) $ 1,588,104 |
Schedule of fair value inputs | A summary of quantitative information about significant unobservable inputs (Level 3 inputs) used in measuring the Company’s embedded conversion options that are categorized within Level 3 of the fair value hierarchy for the six months ended May 31, 2016 and for the year ended November 30, 2015 is as follows: Date of valuation May 31, 2016 November 30, 2015 Stock price $ 0.25 $ 0.45 Conversion price $ .15 $0.10 – $0.22 Volatility 77.11 % 161% – 239% Risk free interest rate 1.03 % 0.11% – 0.86% Years to maturity 2.90 – 2.93 0.45 – 1.74 A summary of quantitative information about significant unobservable inputs (Level 3 inputs) used in measuring the Company’s derivative warrant liabilities that are categorized within Level 3 of the fair value hierarchy for the six months ended May 31, 2016: May 31, 2016 Stock price $ 0.25 Conversion price $0.001 – $0.30 Volatility 75.31% – 79.70% Risk free interest rate 0.68% – 1.03% Years to maturity 0.77 – 3.08 |
ORGANIZATION AND DESCRIPTION _2
ORGANIZATION AND DESCRIPTION OF BUSINESS (Details Narrative) | 6 Months Ended |
May 31, 2016 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Date of Incorporation | Apr. 14, 2011 |
Date of Subsidiary Incorporation | May 19, 2014 |
LIQUIDITY AND GOING CONCERN (De
LIQUIDITY AND GOING CONCERN (Details Narrative) - USD ($) | 6 Months Ended | |||
May 31, 2016 | May 31, 2015 | Dec. 02, 2015 | Nov. 30, 2015 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | ||||
Loss available to common shareholders | $ 990,374 | $ 773,045 | ||
Accumulated deficit | (4,203,191) | $ (3,212,817) | ||
Working capital | 2,927,449 | |||
Principal Amount | $ 778,570 | $ 125,000 | $ 619,300 |
SUMMARY OF SIGNIFICANT ACCOUN_4
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Details) - shares | Dec. 02, 2015 | May 31, 2016 | May 31, 2015 |
Number of shares of common stock underlying the convertible promissory notes | 100,000 | 11,624,546 | 604,167 |
Warrant [Member] | |||
Number of shares of common stock underlying the convertible promissory notes | 175,000 | ||
Convertible Notes Payable [Member] | |||
Number of shares of common stock underlying the convertible promissory notes | 11,499,546 | 604,167 |
SUMMARY OF SIGNIFICANT ACCOUN_5
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Details Narrative) | 6 Months Ended |
May 31, 2016 | |
Accounting Policies [Abstract] | |
Description of lowest trading price | 55% of the lowest trading price of the Company’s common stock for the 25 days preceding conversion. |
REVISION OF PREVIOUSLY ISSUED_3
REVISION OF PREVIOUSLY ISSUED FINANCIAL STATEMENTS (Details) - USD ($) | May 31, 2016 | Nov. 30, 2015 | May 31, 2015 |
Assets: | |||
Total current assets | $ 131,521 | $ 18,332 | $ 356,883 |
Total assets | 403,362 | 18,332 | 357,588 |
Liabilities and Stockholders' Deficit: | |||
Total current liabilities | 3,058,970 | 2,105,721 | 687,772 |
Total liabilities and stockholders' deficit | $ 403,362 | $ 18,332 | 357,588 |
As Reported [Member] | |||
Assets: | |||
Total current assets | 356,883 | ||
Total assets | 411,588 | ||
Liabilities and Stockholders' Deficit: | |||
Total current liabilities | 687,772 | ||
Total liabilities and stockholders' deficit | 411,588 | ||
Adjustment [Member] | |||
Assets: | |||
Total current assets | |||
Total assets | (54,000) | ||
Liabilities and Stockholders' Deficit: | |||
Total current liabilities | |||
Total liabilities and stockholders' deficit | $ (54,000) |
REVISION OF PREVIOUSLY ISSUED_4
REVISION OF PREVIOUSLY ISSUED FINANCIAL STATEMENTS (Details 1) - USD ($) | 3 Months Ended | 6 Months Ended | ||
May 31, 2016 | May 31, 2015 | May 31, 2016 | May 31, 2015 | |
General and administrative expenses | $ 196,225 | $ 313,005 | $ 371,995 | $ 499,835 |
Loss from operations | (196,225) | (310,096) | (371,995) | (490,465) |
Net loss | $ (682,118) | $ (581,476) | $ (990,374) | $ (773,045) |
Basic and diluted net loss per common share (in dollars per share) | $ (0.10) | $ (0.11) | $ (0.15) | $ (0.14) |
Weighted average shares outstanding, basic and diluted (in shares) | 6,842,254 | 5,451,384 | 6,680,701 | 5,336,296 |
As Reported [Member] | ||||
General and administrative expenses | $ 301,755 | $ 475,085 | ||
Loss from operations | (298,846) | (465,715) | ||
Net loss | $ (570,226) | $ (748,295) | ||
Basic and diluted net loss per common share (in dollars per share) | $ (0.10) | $ (0.14) | ||
Weighted average shares outstanding, basic and diluted (in shares) | 5,451,384 | 5,336,296 | ||
Adjustment [Member] | ||||
General and administrative expenses | $ 11,250 | $ 24,750 | ||
Loss from operations | (11,250) | (24,750) | ||
Net loss | $ (11,250) | $ (24,750) | ||
Basic and diluted net loss per common share (in dollars per share) | $ 0 | $ 0 | ||
Weighted average shares outstanding, basic and diluted (in shares) | 5,451,384 | 5,336,296 |
WARRANTS (Details)
WARRANTS (Details) | 6 Months Ended |
May 31, 2016$ / sharesshares | |
Number Outstanding | shares | 175,000 |
Weighted Average Remaining Contractual Life (Years) | 1 year 5 months 1 day |
Number Exercisable | shares | 175,000 |
Weighted Average Exercise Price, Exercisable | $ 0.13 |
Minimum [Member] | |
Exercise Price | 0.01 |
Maximum [Member] | |
Exercise Price | 0.30 |
$0.01 [Member] | |
Exercise Price | $ 0.01 |
Number Outstanding | shares | 100,000 |
Weighted Average Remaining Contractual Life (Years) | 6 months 4 days |
Weighted Average Exercise Price | $ 0.01 |
Number Exercisable | shares | 100,000 |
Weighted Average Exercise Price, Exercisable | $ 0.01 |
$0.30 [Member] | |
Exercise Price | $ 0.30 |
Number Outstanding | shares | 75,000 |
Weighted Average Remaining Contractual Life (Years) | 2 years 7 months 20 days |
Weighted Average Exercise Price | $ 0.01 |
Number Exercisable | shares | 75,000 |
Weighted Average Exercise Price, Exercisable | $ 0.30 |
WARRANTS (Details 1)
WARRANTS (Details 1) - Warrant [Member] | 6 Months Ended |
May 31, 2016 | |
Weighted Average Risk-Free Interest Rate [Member] | |
Fair value assumptions interest rate | 0.52% |
Weighted Average Life [Member] | |
Weighted average life (in years) | 2 years |
Volatility [Member] | Minimum [Member] | |
Fair value assumptions interest rate | 167.90% |
Volatility [Member] | Maximum [Member] | |
Fair value assumptions interest rate | 184.90% |
Expected Dividend Yield [Member] | |
Fair value assumptions interest rate | 0.00% |
Weighted Average Grant-Date Fair Value Per [Member] | |
Fair value assumptions interest rate | 41.00% |
WARRANTS (Details Narrative)
WARRANTS (Details Narrative) - USD ($) | Dec. 02, 2015 | Jan. 31, 2016 | May 31, 2016 | May 31, 2015 | Jan. 20, 2016 | Nov. 30, 2015 |
Warrants issued | 175,000 | |||||
Weighted Average Exercise Price, Exercisable | $ 0.13 | |||||
Number of shares of common stock underlying the convertible promissory notes | 100,000 | 11,624,546 | 604,167 | |||
Aggregate principal amount | $ 125,000 | $ 778,570 | $ 619,300 | |||
LG Capital Funding, LLC [Member] | ||||||
Number of shares of common stock underlying the convertible promissory notes | 75,000 | 75,000 | ||||
Aggregate principal amount | $ 50,000 | $ 50,000 |
NOTES RECEIVABLE (Details)
NOTES RECEIVABLE (Details) | May 31, 2016USD ($) |
Total notes receivable | $ 428,659 |
Less: original issue discount | (53,159) |
Total notes receivable, net | 375,500 |
Less: current portion | (103,659) |
Notes receivable - long-term portion | 271,841 |
JS Technologies, Inc. [Member] | |
Total notes receivable | 325,000 |
Philo Group [Member] | |
Total notes receivable | $ 103,659 |
NOTES RECEIVABLE (Details Narra
NOTES RECEIVABLE (Details Narrative) - USD ($) | Aug. 04, 2015 | May 31, 2016 | May 31, 2016 | Feb. 26, 2016 | May 31, 2015 | May 31, 2016 | May 31, 2015 | Dec. 02, 2015 | Nov. 30, 2015 |
Aggregate principal amount | $ 778,570 | $ 778,570 | $ 778,570 | $ 125,000 | $ 619,300 | ||||
Interest income from the discount accretion | 42,268 | 48,708 | |||||||
10% Secured Promissory Note (the "JST Note") Due on August 5, 2016 [Member] | |||||||||
Repayment of notes receivable | $ 95,000 | ||||||||
10% Secured Promissory Note (the "JST Note") Due on August 5, 2016 [Member] | JS Technologies, Inc. [Member] | |||||||||
Aggregate principal amount | $ 400,000 | 120,000 | |||||||
Loans receivable collateral | Secured by substantially all of the assets of JST. | ||||||||
Original issue discount | 13,333 | ||||||||
Repayment of notes receivable | 19,674 | ||||||||
Interest income from the discount accretion | $ 9,358 | $ 13,333 | |||||||
Contractual rate | 10.00% | 10.00% | |||||||
Interest income based upon contractual rate | $ 2,860 | $ 5,326 | |||||||
10% Secured Promissory Note (the "JST Note") Due on August 5, 2016 [Member] | JS Technologies, Inc. [Member] | Third-Party Noteholder [Member] | |||||||||
Repayment of notes receivable | 10,000 | ||||||||
10% Secured Promissory Note (the "JST Note") Due on August 5, 2016 [Member] | MCKEA Holdings, LLC. [Member] | |||||||||
Repayment of notes receivable | $ 25,000 | ||||||||
16% Senior Secured Property Note [Member] | Philo Group [Member] | |||||||||
Aggregate principal amount | $ 250,000 | 250,000 | 250,000 | ||||||
Loans receivable collateral | The Philo Note is personally guaranteed by the principal of Philo and secured by all assets of Philo. In addition, the principal of Philo has agreed to further secure the loan by pledging several pieces of real property located in California. | ||||||||
Original issue discount | $ 75,000 | 75,000 | 75,000 | ||||||
Interest income from the discount accretion | $ 21,841 | $ 21,841 | |||||||
Contractual rate | 16.00% | 16.00% | |||||||
Interest income based upon contractual rate | $ 8,208 | $ 8,208 | |||||||
Frequency of periodic payment | Monthly interest payments. | ||||||||
Debt term | 6 months | ||||||||
Legal fees | $ 5,000 |
CONVERTIBLE NOTES PAYABLE (Deta
CONVERTIBLE NOTES PAYABLE (Details) - USD ($) | Jun. 06, 2016 | May 31, 2016 | Jan. 31, 2016 | Jan. 20, 2016 | Dec. 02, 2015 | Nov. 30, 2015 |
Principal value | $ 778,570 | $ 125,000 | $ 619,300 | |||
Fair value of bifurcated put option | 1,222,283 | 1,313,012 | ||||
Less: debt discount | (199,333) | (202,325) | ||||
Carrying amount | 2,134,387 | 1,729,987 | ||||
Total carrying amount of convertible notes | 2,134,387 | 1,729,987 | ||||
Total short-term carrying amount of convertible notes | 1,928,334 | 1,729,987 | ||||
Total long-term carrying amount of convertible notes | 206,053 | |||||
LG Capital Funding, LLC [Member] | ||||||
Principal value | $ 50,000 | $ 50,000 | ||||
Convertible Notes Payable [Member] | Black Mountain Equities, Inc. [Member] | ||||||
Principal value | 42,670 | 55,000 | ||||
Fair value of bifurcated put option | 57,516 | 81,951 | ||||
Less: debt discount | (453) | (28,028) | ||||
Carrying amount | 99,733 | 108,923 | ||||
Convertible Notes Payable [Member] | Adar Bays, LLC [Member] | ||||||
Principal value | 115,000 | 115,000 | ||||
Fair value of bifurcated put option | 186,694 | 207,659 | ||||
Less: debt discount | (40,411) | |||||
Carrying amount | 301,694 | 282,248 | ||||
Convertible Notes Payable [Member] | Union Capital, LLC [Member] | ||||||
Principal value | 115,000 | 115,000 | ||||
Fair value of bifurcated put option | 186,611 | 207,536 | ||||
Less: debt discount | (40,096) | |||||
Carrying amount | 301,611 | 282,440 | ||||
Convertible Notes Payable [Member] | Typenex Co-Investment, LLC [Member] | ||||||
Principal value | 87,500 | 87,500 | ||||
Fair value of bifurcated put option | 373,733 | 380,858 | ||||
Less: debt discount | (153) | (28,130) | ||||
Carrying amount | 461,080 | 440,228 | ||||
Total short-term carrying amount of convertible notes | $ 149,054 | |||||
Convertible Notes Payable [Member] | Dr.Gary Gelbfish [Member] | ||||||
Principal value | 100,000 | 100,000 | ||||
Fair value of bifurcated put option | 203,030 | 118,391 | ||||
Less: debt discount | ||||||
Carrying amount | 303,030 | 218,391 | ||||
Convertible Notes Payable [Member] | JMJ Financial [Member] | ||||||
Principal value | 60,500 | 60,500 | ||||
Fair value of bifurcated put option | 212,973 | 155,017 | ||||
Less: debt discount | (30,160) | (44,576) | ||||
Carrying amount | 243,313 | 170,941 | ||||
Convertible Notes Payable [Member] | LG Capital Funding, LLC [Member] | ||||||
Principal value | 50,000 | 50,000 | ||||
Fair value of bifurcated put option | 76,462 | 94,905 | ||||
Less: debt discount | ||||||
Carrying amount | 126,462 | 144,905 | ||||
Convertible Notes Payable [Member] | GCEF Opportunity Fund, LLC [Member] | ||||||
Principal value | 27,500 | 27,500 | ||||
Fair value of bifurcated put option | 39,809 | 50,532 | ||||
Less: debt discount | (2,185) | (15,973) | ||||
Carrying amount | 65,124 | 62,059 | ||||
Convertible Notes Payable [Member] | Lord Abstract, LLC [Member] | ||||||
Principal value | 8,800 | 8,800 | ||||
Fair value of bifurcated put option | 18,186 | 16,163 | ||||
Less: debt discount | (699) | (5,111) | ||||
Carrying amount | 26,287 | 19,852 | ||||
Convertible Notes Payable [Member] | JLA Realty Notes [Member] | ||||||
Principal value | 160,600 | |||||
Fair value of bifurcated put option | 166,930 | |||||
Less: debt discount | (156,451) | |||||
Carrying amount | 171,079 | |||||
Other Convertible Note Payable [Member] | ||||||
Principal value | 11,000 | |||||
Fair value of bifurcated put option | 33,206 | |||||
Less: debt discount | (9,232) | |||||
Carrying amount | $ 34,974 |
CONVERTIBLE NOTES PAYABLE (De_2
CONVERTIBLE NOTES PAYABLE (Details Narrative) | May 11, 2018USD ($)shares | Jan. 23, 2018USD ($)$ / sharesshares | Apr. 04, 2017USD ($) | Mar. 09, 2017USD ($)$ / sharesshares | Mar. 09, 2016shares | Jan. 29, 2016USD ($)shares | Jan. 28, 2016USD ($)shares | Jan. 26, 2016USD ($)$ / sharesshares | Jan. 31, 2016USD ($)$ / sharesshares | Jul. 31, 2018USD ($) | Aug. 31, 2016USD ($) | May 31, 2016USD ($)$ / sharesshares | May 31, 2015USD ($) | May 31, 2016USD ($)Day$ / sharesshares | May 31, 2015USD ($) | Jun. 06, 2016USD ($) | Nov. 30, 2015USD ($)shares |
Derivative liability | $ 24,900 | $ 24,900 | |||||||||||||||
Interest expense | 109,351 | $ 68,669 | 192,671 | $ 79,869 | |||||||||||||
Outstanding balance | $ 1,928,334 | $ 1,928,334 | $ 1,729,987 | ||||||||||||||
Number of outstanding, common stock | shares | 6,842,254 | 6,842,254 | 6,309,635 | ||||||||||||||
Debt instrument, carrying amount | $ 2,134,387 | $ 2,134,387 | $ 1,729,987 | ||||||||||||||
Conversion price (in dollars per share) | $ / shares | $ 20,000 | ||||||||||||||||
Put Option [Member] | |||||||||||||||||
Derivative liability | 1,200,000 | 1,200,000 | |||||||||||||||
Convertible Notes Payable [Member] | |||||||||||||||||
Accrued interest | 130,419 | 130,419 | |||||||||||||||
Convertible Notes Payable [Member] | Put Option [Member] | |||||||||||||||||
Number of common stock issued | shares | 457,619 | ||||||||||||||||
Loss on issuance of debt | $ 68,522 | $ 71,061 | |||||||||||||||
Value of shares issued | $ 183,048 | ||||||||||||||||
Loss on conversion | $ 154,694 | ||||||||||||||||
Other Convertible Notes Payable [Member] | |||||||||||||||||
Interest rate | 10.00% | 10.00% | |||||||||||||||
Conversion term | The note are convertible into shares of the Company’s common stock, at any time after six months from the date of issuance, at a conversion price per share equal the lesser of: (i) fifty percent (50%) discount to the volume weighted average price over the twenty (20) consecutive trading days immediately preceding the notice of conversion. | ||||||||||||||||
Number of common stock issuable upon conversion | shares | 110,609 | ||||||||||||||||
Debt instrument, carrying amount | $ 34,974 | $ 34,974 | |||||||||||||||
Payment terms | Convertible notes payable are due and payable 36 months after issuance. | ||||||||||||||||
Convertible Promissory Notes [Member] | |||||||||||||||||
Interest expense | 75,891 | $ 84,178 | $ 170,441 | $ 84,178 | |||||||||||||
Adar Bays, LLC and Union Capital, LLC [Member] | Convertible Notes Payable [Member] | |||||||||||||||||
Accrued interest | $ 23,000 | $ 23,000 | |||||||||||||||
Interest rate | 8.00% | 8.00% | |||||||||||||||
Date of issuance | May 11, 2015 | ||||||||||||||||
Date of maturity | May 12, 2016 | ||||||||||||||||
Convertible rate | 40.00% | ||||||||||||||||
Consecutive trading days | Day | 20 | ||||||||||||||||
Number of common stock issuable upon conversion | shares | 1,916,667 | ||||||||||||||||
Adar Bays, LLC and Union Capital, LLC [Member] | Convertible Notes Payable [Member] | Note Settlement And Termination Agreements [Member] | |||||||||||||||||
Outstanding balance | $ 200,000 | ||||||||||||||||
Number of outstanding, common stock | shares | 100,000 | ||||||||||||||||
Payment date | Jan. 26, 2018 | ||||||||||||||||
Closing price (in dollars per share) | $ / shares | $ 1.40 | ||||||||||||||||
Debt instrument, carrying amount | $ 340,000 | ||||||||||||||||
Typenex Co-Investment, LLC [Member] | |||||||||||||||||
Number of common stock issued | shares | 297,619 | ||||||||||||||||
Value of shares issued | $ 12,500 | ||||||||||||||||
Typenex Co-Investment, LLC [Member] | Convertible Notes Payable [Member] | |||||||||||||||||
Interest expense | $ 18,200 | ||||||||||||||||
Interest rate | 10.00% | 10.00% | |||||||||||||||
Date of issuance | May 29, 2015 | ||||||||||||||||
Date of maturity | Jun. 29, 2016 | ||||||||||||||||
Conversion term | The notes were convertible into shares of the Company’s common stock at any time prior to maturity at a conversion price per share equal to a forty percent (40%) discount to the lowest trading price for the twenty (20) consecutive trading days immediately preceding the notice of conversion. | ||||||||||||||||
Number of common stock issuable upon conversion | shares | 2,966,548 | ||||||||||||||||
Outstanding balance | $ 149,054 | ||||||||||||||||
Debt instrument, carrying amount | $ 461,080 | $ 461,080 | 440,228 | ||||||||||||||
Conversion price (in dollars per share) | $ / shares | $ 1.30 | $ 1.30 | |||||||||||||||
Payment of debt | $ 90,000 | ||||||||||||||||
Gary Gelbfish [Member] | Convertible Notes Payable [Member] | |||||||||||||||||
Interest rate | 10.00% | 10.00% | |||||||||||||||
Date of issuance | Mar. 27, 2015 | ||||||||||||||||
Date of maturity | Sep. 23, 2015 | ||||||||||||||||
Convertible rate | 50.00% | ||||||||||||||||
Consecutive trading days | Day | 20 | ||||||||||||||||
Number of common stock issuable upon conversion | shares | 767,754 | ||||||||||||||||
Conversion price (in dollars per share) | $ / shares | $ 0.50 | $ 0.50 | |||||||||||||||
JMJ Financial [Member] | |||||||||||||||||
Number of common stock issued | shares | 60,000 | ||||||||||||||||
Value of shares issued | $ 3,024 | ||||||||||||||||
JMJ Financial [Member] | Convertible Notes Payable [Member] | |||||||||||||||||
Interest rate | 12.00% | 12.00% | |||||||||||||||
Date of issuance | Apr. 29, 2015 | ||||||||||||||||
Convertible rate | 40.00% | ||||||||||||||||
Consecutive trading days | Day | 25 | ||||||||||||||||
Number of common stock issuable upon conversion | shares | 875,000 | ||||||||||||||||
Debt instrument, carrying amount | $ 243,313 | $ 243,313 | 170,941 | ||||||||||||||
JMJ Financial [Member] | Convertible Notes Payable [Member] | Subsequent Event [Member] | |||||||||||||||||
Payment of debt | $ 35,000 | ||||||||||||||||
Number of common stock issued | shares | 20,000 | ||||||||||||||||
Value of shares issued | $ 4,550 | ||||||||||||||||
Debt default amount | $ 25,500 | ||||||||||||||||
Black Mountain Equities, Inc. [Member] | |||||||||||||||||
Number of common stock issued | shares | 100,000 | ||||||||||||||||
Value of shares issued | $ 12,830 | ||||||||||||||||
Black Mountain Equities, Inc. [Member] | Convertible Notes Payable [Member] | |||||||||||||||||
Interest rate | 10.00% | 10.00% | |||||||||||||||
Date of issuance | Jun. 4, 2015 | ||||||||||||||||
Date of maturity | Jun. 4, 2016 | ||||||||||||||||
Convertible rate | 40.00% | ||||||||||||||||
Consecutive trading days | Day | 25 | ||||||||||||||||
Number of common stock issuable upon conversion | shares | 627,024 | ||||||||||||||||
Conversion price (in dollars per share) | $ / shares | $ 1.06 | $ 1.06 | |||||||||||||||
LG Capital Funding, LLC [Member] | Convertible Notes Payable [Member] | |||||||||||||||||
Interest rate | 8.00% | 8.00% | |||||||||||||||
Convertible rate | 40.00% | ||||||||||||||||
Consecutive trading days | Day | 20 | ||||||||||||||||
Conversion term | The notes were convertible into shares of the Company’s common stock at any time prior to maturity at a conversion price per share equal to a forty percent (40%) discount to the lowest trading price for the twenty (20) consecutive trading days immediately preceding the notice of conversion. | ||||||||||||||||
Number of common stock issuable upon conversion | shares | 694,444 | ||||||||||||||||
Debt instrument, carrying amount | $ 126,462 | $ 126,462 | 144,905 | ||||||||||||||
Number of warrants granted | shares | 75,000 | ||||||||||||||||
Warrants exercise price (in dollars per share) | $ / shares | $ 0.30 | ||||||||||||||||
Fair value of the warrants | $ 26,250 | ||||||||||||||||
Percentage of accrued interest | 24.00% | ||||||||||||||||
Percentage of pre-payment penalty | 120.00% | ||||||||||||||||
GCEF Opportunity Fund, LLC [Member] | Subsequent Event [Member] | |||||||||||||||||
Closing price (in dollars per share) | $ / shares | $ 0.15 | ||||||||||||||||
Number of common stock issued | shares | 216,946 | ||||||||||||||||
Value of shares issued | $ 32,542 | ||||||||||||||||
GCEF Opportunity Fund, LLC [Member] | Convertible Notes Payable [Member] | |||||||||||||||||
Interest rate | 10.00% | 10.00% | |||||||||||||||
Date of issuance | Jun. 30, 2015 | ||||||||||||||||
Convertible rate | 40.00% | ||||||||||||||||
Consecutive trading days | Day | 20 | ||||||||||||||||
Conversion term | The note are convertible into shares of the Company’s common stock, at any time after 30 days from the date of issuance, at a conversion price per share equal to the lower of: (i) a forty percent (40%) discount to the lowest closing price for the twenty (20) consecutive trading days immediately preceding the notice of conversion or (ii) $1.00. If this note is not paid at maturity, then the interest rate shall increase to 24% thereafter. | ||||||||||||||||
Number of common stock issuable upon conversion | shares | 381,944 | ||||||||||||||||
Debt instrument, carrying amount | $ 65,124 | $ 65,124 | 62,059 | ||||||||||||||
Conversion price (in dollars per share) | $ / shares | $ 1 | $ 1 | |||||||||||||||
Number of common stock issued | shares | 216,946 | ||||||||||||||||
Lord Abstract, LLC [Member] | Convertible Notes Payable [Member] | |||||||||||||||||
Interest rate | 10.00% | 10.00% | |||||||||||||||
Date of issuance | Jun. 30, 2015 | ||||||||||||||||
Convertible rate | 40.00% | ||||||||||||||||
Consecutive trading days | Day | 20 | ||||||||||||||||
Conversion term | The note are convertible into shares of the Company’s common stock, at any time after 30 days from the date of issuance, at a conversion price per share equal to the lower of: (i) a forty percent (40%) discount to the lowest closing price for the twenty (20) consecutive trading days immediately preceding the notice of conversion or (ii) $1.00. If this note is not paid at maturity, then the interest rate shall increase to 24% thereafter. | ||||||||||||||||
Number of common stock issuable upon conversion | shares | 122,222 | ||||||||||||||||
Debt instrument, carrying amount | $ 26,287 | $ 26,287 | $ 19,852 | ||||||||||||||
Lord Abstract, LLC [Member] | Convertible Notes Payable [Member] | Subsequent Event [Member] | |||||||||||||||||
Payment of debt | $ 7,500 | ||||||||||||||||
Debt default amount | $ 1,300 | ||||||||||||||||
JLA Realty [Member] | Convertible Notes Payable [Member] | |||||||||||||||||
Interest expense | $ 4,151 | $ 4,151 | |||||||||||||||
Interest rate | 12.00% | 12.00% | |||||||||||||||
Number of common stock issuable upon conversion | shares | 1,070,607 | ||||||||||||||||
Closing price (in dollars per share) | $ / shares | $ 0.15 | $ 0.15 | |||||||||||||||
Payment terms | Convertible note payable is due and payable 36 months after proceeds have been received by the Company, which occurred between April 25, 2016 and May 4, 2016. | ||||||||||||||||
Amortization of the debt discount | $ 146,000 | ||||||||||||||||
Loss on issuance of debt | $ 68,522 | ||||||||||||||||
Fair value of the bifurcated conversion of debt | $ 215,000 | ||||||||||||||||
Fair value of bifurcated conversion option | $ 166,930 |
NOTES PAYABLE (Details)
NOTES PAYABLE (Details) - USD ($) | May 31, 2016 | Nov. 30, 2015 | |
Notes payable | $ 510,706 | $ 135,031 | |
Notes payable [Member] | |||
Total notes payable | 579,075 | 154,325 | |
Less: debt discount | (68,369) | (19,294) | |
Notes payable | 510,706 | 135,031 | |
Notes payable [Member] | Lori Livingston [Member] | |||
Total notes payable | [1] | 105,000 | |
Notes payable [Member] | JLA Realty [Member] | |||
Total notes payable | [2] | 330,000 | |
Notes payable [Member] | Studio Capital, LLC [Member] | |||
Total notes payable | [3] | 125,000 | 125,000 |
Notes payable [Member] | Argent Offset, LLC [Member] | |||
Total notes payable | [4] | 6,575 | 16,825 |
Notes payable [Member] | Strategic IR, Inc. [Member] | |||
Total notes payable | [5] | $ 12,500 | $ 12,500 |
[1] | On December 2, 2015 the Company entered into a promissory note agreement the Livingston Note with a third party for an aggregate principal amount of dollars 125,000. The Livingston Note carries an original issue discount of dollars 25000. As additional consideration to the investor, the Company agreed to issue a warrant to purchase up to 100,000 shares of the Company common stock at a price of dollar 0.01 per share. The Company recorded debt discount in the amount of dollars 30,987 based on the fair value of the warrants. The Livingston Note is currently in default and accruing interest at the default rate of 29 percent. In January 2016 the Company recorded in interest expense a one time default penalty of dollars 25000 representing 20percentage of the outstanding principal balance of the Livingston Note. | ||
[2] | On April 7, 2016 and September 14, 2016, RCG entered into promissory note agreements with JLA Realty (the "JLA Notes") for an aggregate amount of $480,000. The JLA Notes accrue interest at 16% per annum and have maturity dates of October 4, 2016 and March 14, 2017 and carry an original issue discount of $125,000. Between November 2016 and December 2016, the Company made payments of $150,000 on the JLA Notes and the remaining principal balance of $330,000 remains in default as of the date of these financial statements are issued. | ||
[3] | On October 8, 2015, the Company entered into a promissory note agreement with Studio Capital, LLC, ("Studio Capital") for an aggregate principal amount of $125,000 (the "Studio Capital Note"). The Studio Capital Note carries an original issue discount of $25,000, provided for a loan fee of 5,000 shares of the Company's common stock and had a maturity date of April 8, 2016. The Studio Capital Note was not repaid on the maturity date and as such is in default as of May 31, 2016 and remains in default as of the date these financial statements are issued. The Company recorded in interest expense, including penalties, on the condensed statements of operations a one-time default penalty of $25,000 representing 20% of the outstanding principal balance of the Studio Capital Note. | ||
[4] | On November 26, 2014, the Company entered into a promissory note agreement with Argent Offset, LLC Argent for an aggregate principal amount of dollars 13000 the Argent Note. The Argent Note included a dollars 500 loan fee, accrues interest at 10 percent compounded monthly and has a maturity date of December 5, 2014. On February 1, 2015, the Company entered into a Temporary Forbearance Agreement with Argent. Under the forbearance agreement, the Company agreed to pay a forbearance fee of dollars 7,000 to extend the maturity date to August 1, 2015. Argent also advanced the Company an additional dollars 19,825 pursuant to the terms of the Argent Note. During the six months ended May 31, 2016, the Company paid dollars 10,250 on the Argent Note. As of November 30, 2016 all remaining amounts due had been repaid on the Argent Note. | ||
[5] | On March 17, 2015, the Company entered into a promissory note agreement with Strategic, IR, Inc. ("Strategic") for an aggregate principal amount of $12,500 (the "Strategic Note"). The Strategic Note included a $1,750 loan fee, accrued interest at 10% and had a maturity date of April 16, 2015. The Strategic Note is currently is in default as of May 31, 2016 and remains in default as of the date these financial statements are issued and is accruing interest at the default rate of 21% per annum. |
NOTES PAYABLE (Details Narrativ
NOTES PAYABLE (Details Narrative) - USD ($) | Sep. 14, 2016 | Apr. 07, 2016 | Dec. 02, 2015 | Oct. 08, 2015 | Mar. 17, 2015 | Nov. 26, 2014 | Dec. 31, 2016 | May 31, 2016 | May 31, 2016 | May 31, 2015 | Nov. 30, 2015 |
Proceeds from notes payable | $ 355,000 | ||||||||||
Aggregate principal amount | $ 125,000 | $ 778,570 | 778,570 | $ 619,300 | |||||||
Debt instrument, carrying amount | 2,134,387 | 2,134,387 | 1,729,987 | ||||||||
Debt unamortized discount | 33,650 | 33,650 | $ 202,325 | ||||||||
Repayment of notes payable | $ 20,250 | $ 5,000 | |||||||||
Number of shares of common stock underlying the convertible promissory notes | 100,000 | 11,624,546 | 604,167 | ||||||||
Interest Expense | 35,947 | $ 81,912 | |||||||||
Accrued interest | $ 82,746 | 82,746 | |||||||||
Studio Capital, LLC [Member] | Notes payable [Member] | |||||||||||
Debt issuance date | Oct. 8, 2015 | ||||||||||
Aggregate principal amount | $ 125,000 | ||||||||||
Debt unamortized discount | $ 25,000 | ||||||||||
Debt maturity date | Apr. 8, 2016 | ||||||||||
Debt instrument fee | The Studio Capital Note carries an original issue discount of $25,000, provided for a loan fee of 5,000 shares of the Company’s common stock and had a maturity date of April 8, 2016. | ||||||||||
Discription of debt penalty | The Studio Capital Note was not repaid on the maturity date and as such is in default as of May 31, 2016 and remains in default as of the date these financial statements are issued. The Company recorded in interest expense, including penalties, on the condensed statements of operations a one-time default penalty of $25,000 representing 20% of the outstanding principal balance of the Studio Capital Note. | ||||||||||
Amount of penalty on debt issued | $ 25,000 | ||||||||||
Number of shares of common stock underlying the convertible promissory notes | 5,000 | ||||||||||
Argent Offset, LLC [Member] | Notes payable [Member] | |||||||||||
Debt issuance date | Nov. 26, 2014 | ||||||||||
Interest rate | 10.00% | ||||||||||
Aggregate principal amount | $ 13,000 | ||||||||||
Debt maturity date | Dec. 5, 2014 | ||||||||||
Debt instrument fee | The Argent Note included a $500 loan fee, accrues interest at 10%, compounded monthly, and had a maturity date of December 5, 2014. On February 1, 2015. | ||||||||||
Discription of debt penalty | On February 1, 2015, the Company entered into a Temporary Forbearance Agreement with Argent. Under the forbearance agreement, the Company agreed to pay a forbearance fee of $7,000 to extend the maturity date to August 1, 2015. Argent also advanced the Company an additional $19,825 pursuant to the terms of the Argent Note. | ||||||||||
Loan fees | $ 500 | ||||||||||
Repayment of notes payable | $ 10,250 | ||||||||||
Strategic IR, Inc. [Member] | Notes payable [Member] | |||||||||||
Debt issuance date | Mar. 17, 2015 | ||||||||||
Interest rate | 10.00% | ||||||||||
Default accruing interest rate | 21.00% | ||||||||||
Aggregate principal amount | $ 12,500 | ||||||||||
Debt maturity date | Apr. 16, 2015 | ||||||||||
Loan fees | $ 1,750 | ||||||||||
Third Party [Member] | Notes payable [Member] | |||||||||||
Debt issuance date | Dec. 2, 2015 | ||||||||||
Default accruing interest rate | 29.00% | ||||||||||
Aggregate principal amount | $ 125,000 | ||||||||||
Debt unamortized discount | $ 25,000 | ||||||||||
Debt instrument fee | The Livingston Note is currently in default and accruing interest at the default rate of 29%. | ||||||||||
Discription of debt penalty | In January 2016, the Company recorded in interest expense a one-time default penalty of $25,000 representing 20% of the outstanding principal balance of the Livingston Note. | ||||||||||
Number of shares of common stock underlying the convertible promissory notes | 100,000 | ||||||||||
Share price | $ 0.01 | ||||||||||
Debt discount | $ 30,987 | ||||||||||
JLA Realty [Member] | Notes payable [Member] | |||||||||||
Debt issuance date | Mar. 14, 2017 | Oct. 4, 2016 | |||||||||
Interest rate | 16.00% | 16.00% | |||||||||
Aggregate principal amount | $ 480,000 | $ 480,000 | |||||||||
Debt unamortized discount | $ 125,000 | $ 125,000 | |||||||||
Subsequent Event [Member] | JLA Realty Notes [Member] | |||||||||||
Repayment of notes payable | $ 150,000 | ||||||||||
Debt default amount | $ 330,000 |
NOTE PAYABLE, RELATED PARTY (De
NOTE PAYABLE, RELATED PARTY (Details) - USD ($) | May 31, 2016 | Nov. 30, 2015 |
Less: debt discount notes payable | $ 2,800 | |
Total note payable, related party | 38,137 | |
Notes payable [Member] | MCKEA Holdings, LLC. [Member] | ||
Note payable | 40,937 | |
Less: debt discount notes payable | (2,800) | |
Total note payable, related party | $ 38,137 |
NOTE PAYABLE, RELATED PARTY (_2
NOTE PAYABLE, RELATED PARTY (Details Narrative) - USD ($) | Mar. 04, 2016 | May 31, 2016 | May 31, 2016 | May 31, 2015 | May 31, 2016 | May 31, 2015 | Nov. 30, 2015 |
Proceeds from notes payable | $ 355,000 | ||||||
Repayments of notes payable | 20,250 | 5,000 | |||||
Unamortized original issue discount | $ 199,333 | $ 199,333 | 199,333 | $ 202,325 | |||
Interest expense | 109,351 | $ 68,669 | 192,671 | $ 79,869 | |||
MCKEA Holdings, LLC. [Member] | 15% Promissory Note Due August 4, 2016 [Member] | |||||||
Proceeds from notes payable | $ 100,000 | ||||||
Interest rate | 15.00% | ||||||
Original issue discount (in percent) | 10.00% | ||||||
Repayments of notes payable | 56,788 | 15,851 | |||||
Unamortized original issue discount | 5,163 | 5,163 | 5,163 | ||||
Outstanding principal balance | $ 40,937 | 40,937 | 40,937 | ||||
Interest expense | $ 2,363 | $ 2,363 |
FAIR VALUE MEASUREMENTS (Detail
FAIR VALUE MEASUREMENTS (Details) - Fair Value, Measurements, Recurring [Member] - USD ($) | May 31, 2016 | Nov. 30, 2015 |
Quoted Prices In Active Markets (Level 1) [Member] | ||
Bifurcated conversion options, put options, and derivative warrant liabilities | ||
Significant Other Observable Inputs (Level 2) [Member] | ||
Bifurcated conversion options, put options, and derivative warrant liabilities | ||
Significant Unobservable Inputs (Level 3) [Member] | ||
Bifurcated conversion options, put options, and derivative warrant liabilities | 1,588,104 | 1,313,012 |
Fair Value Measurement [Member] | ||
Bifurcated conversion options, put options, and derivative warrant liabilities | $ 1,588,104 | $ 1,313,012 |
FAIR VALUE MEASUREMENTS (Deta_2
FAIR VALUE MEASUREMENTS (Details 1) - USD ($) | 3 Months Ended | 6 Months Ended | ||
May 31, 2016 | May 31, 2015 | May 31, 2016 | May 31, 2015 | |
Defined Benefit Plan Disclosure [Line Items] | ||||
Change in estimated fair value recognized in results of operations | $ (231,937) | $ 182,776 | $ 10,206 | $ 182,776 |
Significant Unobservable Inputs (Level 3) [Member] | ||||
Defined Benefit Plan Disclosure [Line Items] | ||||
Balance at beginning | 1,313,012 | |||
Derivative Liabilities from Convertible Notes Payable and Notes Payable | 228,061 | |||
Fair value at Inception | 57,237 | |||
Change in estimated fair value recognized in results of operations | (10,206) | |||
Balance at end | $ 1,588,104 | $ 1,588,104 |
FAIR VALUE MEASUREMENTS (Deta_3
FAIR VALUE MEASUREMENTS (Details 2) - $ / shares | 6 Months Ended | 12 Months Ended | |
May 31, 2016 | Nov. 30, 2015 | Jan. 26, 2016 | |
Conversion price | $ 20,000 | ||
Significant Unobservable Inputs (Level 3) [Member] | |||
Stock price | $ 0.25 | $ 0.45 | |
Conversion price | $ 0.15 | ||
Significant Unobservable Inputs (Level 3) [Member] | Volatility [Member] | |||
Fair value assumptions interest rate | 77.11% | ||
Significant Unobservable Inputs (Level 3) [Member] | Weighted Average Risk-Free Interest Rate [Member] | |||
Fair value assumptions interest rate | 1.03% | ||
Significant Unobservable Inputs (Level 3) [Member] | Minimum [Member] | |||
Conversion price | $ 0.10 | ||
Significant Unobservable Inputs (Level 3) [Member] | Minimum [Member] | Volatility [Member] | |||
Fair value assumptions interest rate | 161.00% | ||
Significant Unobservable Inputs (Level 3) [Member] | Minimum [Member] | Weighted Average Risk-Free Interest Rate [Member] | |||
Fair value assumptions interest rate | 0.11% | ||
Significant Unobservable Inputs (Level 3) [Member] | Minimum [Member] | Weighted Average Life [Member] | |||
Years to maturity | 2 years 10 months 24 days | 5 months 12 days | |
Significant Unobservable Inputs (Level 3) [Member] | Maximum [Member] | |||
Conversion price | $ 0.22 | ||
Significant Unobservable Inputs (Level 3) [Member] | Maximum [Member] | Volatility [Member] | |||
Fair value assumptions interest rate | 239.00% | ||
Significant Unobservable Inputs (Level 3) [Member] | Maximum [Member] | Weighted Average Risk-Free Interest Rate [Member] | |||
Fair value assumptions interest rate | 0.86% | ||
Significant Unobservable Inputs (Level 3) [Member] | Maximum [Member] | Weighted Average Life [Member] | |||
Years to maturity | 2 years 11 months 5 days | 1 year 8 months 26 days |
RELATED PARTY TRANSACTIONS (Det
RELATED PARTY TRANSACTIONS (Details Narrative) - USD ($) | 1 Months Ended | 3 Months Ended | 6 Months Ended | 20 Months Ended | ||
Feb. 28, 2017 | May 31, 2015 | May 31, 2015 | Dec. 31, 2017 | Dec. 31, 2016 | Feb. 29, 2016 | |
Product sold | $ 23,547 | $ 33,784 | ||||
Percentage of total revenue | 88.00% | |||||
Subsequent Event [Member] | ||||||
Notes receivable, advances | $ 17,222 | |||||
Subsequent Event [Member] | Management Services Agreement [Member] | ||||||
Avalanche receives for services | $ 20,000 | $ 40,000 | ||||
MCKEA Holdings, LLC. [Member] | ||||||
Due to related party | $ 53,790 | |||||
MCKEA Holdings, LLC. [Member] | JS Technologies, Inc. [Member] | 10% Secured Promissory Note (the "JST Note") [Member] | ||||||
Notes receivable, advances | $ 25,000 |
EQUITY TRANSACTIONS (Details Na
EQUITY TRANSACTIONS (Details Narrative) - USD ($) | Jan. 29, 2016 | Jan. 28, 2016 | Jan. 26, 2016 | Dec. 10, 2015 | Dec. 02, 2015 | Jul. 31, 2014 | Jan. 31, 2016 | May 31, 2016 | May 31, 2015 | May 31, 2016 | May 31, 2015 | Jan. 26, 2016 | Jan. 20, 2016 | Nov. 30, 2015 | Dec. 10, 2014 |
Preferred stock, share authorized | 10,000,000 | 10,000,000 | 10,000,000 | ||||||||||||
Preferred stock, par value | $ 0.001 | $ 0.001 | $ 0.001 | ||||||||||||
Debt conversion rate (in dollars per share) | $ 20,000 | $ 20,000 | |||||||||||||
Shares issued for services | 50,000 | ||||||||||||||
Shares issued for services, value | |||||||||||||||
Stock based compensation | $ 20,000 | $ 251,833 | |||||||||||||
Convertible notes payable, discount | 199,333 | 199,333 | $ 202,325 | ||||||||||||
Loss on conversion | $ 154,694 | ||||||||||||||
Number of shares of common stock underlying the convertible promissory notes | 100,000 | 11,624,546 | 604,167 | ||||||||||||
Aggregate principal amount | $ 125,000 | 778,570 | $ 778,570 | $ 619,300 | |||||||||||
Common stock issues of value services | |||||||||||||||
Common stock issues of shares services | 50,000 | ||||||||||||||
Typenex Co-Investment, LLC [Member] | |||||||||||||||
Number of shares isssued during the period (in shares) | 297,619 | ||||||||||||||
Issuance of shares, value | $ 12,500 | ||||||||||||||
Loss on conversion | 106,548 | ||||||||||||||
Total cash proceeds of common stock | $ 119,048 | ||||||||||||||
Black Mountain Equities, Inc. [Member] | |||||||||||||||
Number of shares isssued during the period (in shares) | 100,000 | ||||||||||||||
Issuance of shares, value | $ 12,830 | ||||||||||||||
Loss on conversion | 27,170 | ||||||||||||||
Total cash proceeds of common stock | $ 40,000 | ||||||||||||||
JMJ Financial [Member] | |||||||||||||||
Number of shares isssued during the period (in shares) | 60,000 | ||||||||||||||
Issuance of shares, value | $ 3,024 | ||||||||||||||
Loss on conversion | 20,976 | ||||||||||||||
Total cash proceeds of common stock | $ 24,000 | ||||||||||||||
LG Capital Funding, LLC [Member] | |||||||||||||||
Number of shares of common stock underlying the convertible promissory notes | 75,000 | 75,000 | |||||||||||||
Number of value of common stock underlying the convertible promissory notes | $ 26,250 | ||||||||||||||
Aggregate principal amount | $ 50,000 | $ 50,000 | |||||||||||||
Lori Livingston [Member] | |||||||||||||||
Number of shares of common stock underlying the convertible promissory notes | 100,000 | ||||||||||||||
Number of value of common stock underlying the convertible promissory notes | $ 30,987 | ||||||||||||||
Subscription Agreement [Member] | |||||||||||||||
Number of shares isssued during the period (in shares) | 25,000 | ||||||||||||||
Sale of Stock price (in dollars per share) | $ 0.2 | ||||||||||||||
Total cash proceeds of common stock | $ 5,000 | ||||||||||||||
Board of Director [Member] | |||||||||||||||
Class A preferred stock, shares authorized | 50,000 | ||||||||||||||
Class A preferred stock, par value | $ 5 | ||||||||||||||
Percentage of class A preferred stock | 10.00% | ||||||||||||||
Amount of dividend paid class A preferred stock | $ 5 |
SUBSEQUENT EVENTS (Details Narr
SUBSEQUENT EVENTS (Details Narrative) - USD ($) | Dec. 03, 2018 | May 11, 2018 | Jan. 23, 2018 | Dec. 05, 2017 | Aug. 22, 2017 | Apr. 26, 2017 | Mar. 09, 2017 | Mar. 07, 2017 | Feb. 28, 2017 | Oct. 27, 2016 | Mar. 09, 2016 | Jan. 29, 2016 | Dec. 02, 2015 | Dec. 31, 2017 | May 31, 2016 | May 31, 2016 | May 31, 2015 | Jan. 26, 2016 | Nov. 30, 2017 | Sep. 06, 2017 | Feb. 22, 2017 | Nov. 30, 2016 | Nov. 30, 2015 |
Aggregate principal amount | $ 125,000 | $ 778,570 | $ 778,570 | $ 619,300 | |||||||||||||||||||
Proceeds from common stock | 5,000 | $ 2,000 | |||||||||||||||||||||
Debt instrument, carrying amount | $ 2,134,387 | $ 2,134,387 | $ 1,729,987 | ||||||||||||||||||||
Debt conversion rate (in dollars per share) | $ 20,000 | ||||||||||||||||||||||
Number of shares of common stock underlying the convertible promissory notes | 100,000 | 11,624,546 | 604,167 | ||||||||||||||||||||
Number of shares issued for consulting services | 50,000 | ||||||||||||||||||||||
Value of shares issued for consulting services | |||||||||||||||||||||||
Preferred stock, par value (in dollars per share) | $ 0.001 | $ 0.001 | $ 0.001 | ||||||||||||||||||||
Preferred stock, authorized | 10,000,000 | 10,000,000 | 10,000,000 | ||||||||||||||||||||
Warrant [Member] | |||||||||||||||||||||||
Number of shares of common stock underlying the convertible promissory notes | 175,000 | ||||||||||||||||||||||
JMJ Financial [Member] | |||||||||||||||||||||||
Number of shares issued during the period | 60,000 | ||||||||||||||||||||||
Value of shares issued during the period | $ 3,024 | ||||||||||||||||||||||
Convertible Notes Payable [Member] | |||||||||||||||||||||||
Number of shares of common stock underlying the convertible promissory notes | 11,499,546 | 604,167 | |||||||||||||||||||||
Convertible Notes Payable [Member] | GCEF Opportunity Fund, LLC [Member] | |||||||||||||||||||||||
Aggregate principal amount | $ 27,500 | $ 27,500 | $ 27,500 | ||||||||||||||||||||
Debt instrument, carrying amount | $ 65,124 | $ 65,124 | 62,059 | ||||||||||||||||||||
Debt conversion rate (in dollars per share) | $ 1 | $ 1 | |||||||||||||||||||||
Interest rate | 10.00% | 10.00% | |||||||||||||||||||||
Number of shares issued during the period | 216,946 | ||||||||||||||||||||||
Convertible Notes Payable [Member] | Adar Bays, LLC [Member] | |||||||||||||||||||||||
Aggregate principal amount | $ 115,000 | $ 115,000 | 115,000 | ||||||||||||||||||||
Debt instrument, carrying amount | 301,694 | 301,694 | 282,248 | ||||||||||||||||||||
Convertible Notes Payable [Member] | JMJ Financial [Member] | |||||||||||||||||||||||
Aggregate principal amount | 60,500 | 60,500 | 60,500 | ||||||||||||||||||||
Debt instrument, carrying amount | $ 243,313 | $ 243,313 | $ 170,941 | ||||||||||||||||||||
Interest rate | 12.00% | 12.00% | |||||||||||||||||||||
Subsequent Event [Member] | |||||||||||||||||||||||
Description of conversion stock | (i) if the aggregate market capital of the Company on the date of conversion (the “Market Cap”) is $35,000,000 or less, at a 25% discount to the Market Price, or (ii) if the Market Cap is greater than $35,000,000, at a 25% discount to the Market Price, provided that such discount shall be increased by dividing it by the quotient that shall be obtained by dividing $35,0000,000 by the Market Cap at the time of conversion, provided, however, any increase in the discount to the Market Price shall not result in a discount that is greater than a 75% discount (the “Conversion Price”). Notwithstanding the foregoing, in no event shall the Conversion Price be less than $0.35. In addition, the Company may force the conversion of the Notes at any time commencing two (2) years from the Closing Date, provided certain conditions are met. | ||||||||||||||||||||||
Subsequent Event [Member] | 2016 Stock Incentive Plan [Member] | |||||||||||||||||||||||
Number of shares granted | 3,000,000 | ||||||||||||||||||||||
Description of options expire period | The options expire between 5 and 10 years from the date of grant. | ||||||||||||||||||||||
Subsequent Event [Member] | Stock Incentive Plan [Member] | |||||||||||||||||||||||
Number of shares granted | 1,000,000 | ||||||||||||||||||||||
Exercise price of option (in dollars per share) | $ 0.16 | ||||||||||||||||||||||
Exercisable years | 7 years | ||||||||||||||||||||||
Vesting period | 3 years | ||||||||||||||||||||||
Subsequent Event [Member] | Stock Incentive Plan [Member] | MTIX, Ltd [Member] | |||||||||||||||||||||||
Vesting rights | Closing of the acquisition of MTIX, the vesting terms of the options change and will vest 50% upon closing and 50% one year after closing. | ||||||||||||||||||||||
Subsequent Event [Member] | Class A Convertible Preferred Stock [Member] | |||||||||||||||||||||||
Stock price | $ 20 | ||||||||||||||||||||||
Preferred stock voting rights | The Class A Shares shall vote together with the shares of Common Stock as a single class and, regardless of the number of Class A Shares outstanding, provided that at least 25,000 of such Class A Shares are outstanding, shall represent eighty percent (80%) of all votes entitled to be voted at any annual or special meeting of shareholders of the Company or action by written consent of shareholders, including any shares of preferred stock other than the Class A Shares that are voted with the Common Stock. Each outstanding Class A Share shall represent its proportionate share of the 80% which is allocated to the outstanding Class A Shares. The Class A Shares are convertible at the Holder’s option into shares of Common Stock of the Company at a conversion price derived by dividing the stated value of each Class A Share by $0.50 per share, subject to customary adjustment, which conversion may occur at any time at the option of the Holder. | ||||||||||||||||||||||
Preferred stock, outstanding | 25,000 | ||||||||||||||||||||||
Subsequent Event [Member] | Class B Convertible Preferred Stock [Member] | |||||||||||||||||||||||
Preferred stock, par value (in dollars per share) | $ 0.001 | ||||||||||||||||||||||
Preferred stock, authorized | 100,000 | ||||||||||||||||||||||
Liquidation preference value | $ 5,000,000 | ||||||||||||||||||||||
Liquidation preference per share | $ 50 | ||||||||||||||||||||||
Subsequent Event [Member] | Officer [Member] | |||||||||||||||||||||||
Stock price | $ 0.16 | ||||||||||||||||||||||
Number of shares issued for consulting services | 250,000 | ||||||||||||||||||||||
Value of shares issued for consulting services | $ 40,000 | ||||||||||||||||||||||
Subsequent Event [Member] | Warrant [Member] | |||||||||||||||||||||||
Number of shares issued for consulting services | 5,000,000 | ||||||||||||||||||||||
Subsequent Event [Member] | Digital Power Corporation [Member] | Loan and Security Agreement [Member] | Non Revolving Credit Facility [Member] | |||||||||||||||||||||||
Maximum borrowing capacity | $ 10,000,000 | ||||||||||||||||||||||
Subsequent Event [Member] | GCEF Opportunity Fund, LLC [Member] | |||||||||||||||||||||||
Number of shares issued during the period | 216,946 | ||||||||||||||||||||||
Value of shares issued during the period | $ 32,542 | ||||||||||||||||||||||
Stock price | $ 0.15 | ||||||||||||||||||||||
Subsequent Event [Member] | Philou Ventures, LLC [Member] | Exchange Agreement [Member] | Class A Convertible Preferred Stock [Member] | |||||||||||||||||||||||
Number of shares issued during the period | 50,000 | ||||||||||||||||||||||
Number of surrender common stock | 2,000,000 | 2,000,000 | |||||||||||||||||||||
Warrant term | 2 years | ||||||||||||||||||||||
Warrant exercise price (in dollars per share) | $ 0.35 | ||||||||||||||||||||||
Subsequent Event [Member] | MTIX, Ltd [Member] | |||||||||||||||||||||||
Value of minority shareholders | $ 1,666,667 | ||||||||||||||||||||||
Value of majority shareholders | 6,166,666 | ||||||||||||||||||||||
Subsequent Event [Member] | MTIX, Ltd [Member] | Share Exchange Agreement [Member] | |||||||||||||||||||||||
Aggregate principal amount | $ 9,500,000 | ||||||||||||||||||||||
Debt instrument payment terms | (i) $500,000 in cash, $50,000 of which was paid on October 26, 2016, and (ii) 100,000 shares of the Company’s newly designated shares of Class B Shares to the principal shareholder of MTIX (the “Majority Shareholder”). | ||||||||||||||||||||||
Interest rate | 7.00% | ||||||||||||||||||||||
Subsequent Event [Member] | Adar Bays, LLC [Member] | Note Settlement and Termination Agreements [Member] | |||||||||||||||||||||||
Aggregate principal amount | $ 200,000 | ||||||||||||||||||||||
Number of shares issued during the period | 100,000 | ||||||||||||||||||||||
Subsequent Event [Member] | Three Convertible Promissory DPW Notes [Member] | Digital Power Corporation [Member] | |||||||||||||||||||||||
Aggregate principal amount | $ 1,575,000 | ||||||||||||||||||||||
Debt instrument, carrying amount | 75,000 | ||||||||||||||||||||||
Debt net funding | $ 1,500,000 | ||||||||||||||||||||||
Debt conversion rate (in dollars per share) | $ 0.745 | ||||||||||||||||||||||
Interest rate | 12.00% | ||||||||||||||||||||||
Subsequent Event [Member] | 12% Convertible Promissory Notes [Member] | Digital Power Corporation [Member] | |||||||||||||||||||||||
Aggregate principal amount | $ 6,795,346 | ||||||||||||||||||||||
Debt conversion rate (in dollars per share) | $ 0.50 | ||||||||||||||||||||||
Subsequent Event [Member] | 12% Convertible Promissory Notes [Member] | Digital Power Corporation [Member] | Warrant [Member] | |||||||||||||||||||||||
Number of shares issued during the period | 13,590,692 | ||||||||||||||||||||||
Debt term | 2 years | ||||||||||||||||||||||
Loans receivable collateral | The New DPW Notes are secured by the assets of Avalanche. | ||||||||||||||||||||||
Subsequent Event [Member] | Convertible Notes Payable [Member] | Digital Power Corporation [Member] | Exchange Agreement [Member] | WT Johnson & Sons (Huddersfield) Limited [Member] | |||||||||||||||||||||||
Proceeds from common stock | $ 2,267,766 | ||||||||||||||||||||||
Subsequent Event [Member] | Convertible Notes Payable [Member] | JMJ Financial [Member] | |||||||||||||||||||||||
Aggregate principal amount | $ 4,550 | ||||||||||||||||||||||
Number of shares issued during the period | 20,000 | ||||||||||||||||||||||
Value of shares issued during the period | $ 4,550 | ||||||||||||||||||||||
Subsequent Event [Member] | Convertible Promissory Notes A [Member] | Digital Power Corporation [Member] | Exchange Agreement [Member] | WT Johnson & Sons (Huddersfield) Limited [Member] | |||||||||||||||||||||||
Aggregate principal amount | $ 600,000 | $ 600,000 | |||||||||||||||||||||
Value added tax | $ 400,500 | ||||||||||||||||||||||
Debt conversion rate (in dollars per share) | $ 1 | $ 1 | |||||||||||||||||||||
Number of shares issued during the period | 600,000 | ||||||||||||||||||||||
Debt term | 2 years | ||||||||||||||||||||||
Value of shares issued during the period | $ 2,668,266 | ||||||||||||||||||||||
Subsequent Event [Member] | Convertible Promissory Notes B [Member] | WT Johnson & Sons (Huddersfield) Limited [Member] | |||||||||||||||||||||||
Aggregate principal amount | $ 265,666 | ||||||||||||||||||||||
Debt conversion rate (in dollars per share) | $ 0.85 | ||||||||||||||||||||||
Subsequent Event [Member] | Convertible Promissory Notes B [Member] | Digital Power Corporation [Member] | Exchange Agreement [Member] | WT Johnson & Sons (Huddersfield) Limited [Member] | |||||||||||||||||||||||
Aggregate principal amount | $ 1,667,766 | ||||||||||||||||||||||
Debt conversion rate (in dollars per share) | $ 0.85 | ||||||||||||||||||||||
Debt term | 2 years | ||||||||||||||||||||||
Subsequent Event [Member] | Convertible Promissory Notes B [Member] | Digital Power Corporation [Member] | Exchange Agreement [Member] | WT Johnson & Sons (Huddersfield) Limited [Member] | MTIX, Ltd [Member] | |||||||||||||||||||||||
Aggregate principal amount | $ 2,002,500 | ||||||||||||||||||||||
Subsequent Event [Member] | 16% Senior Secured Property Note [Member] | Philo Group [Member] | |||||||||||||||||||||||
Aggregate principal amount | $ 947,092 | $ 947,092 | |||||||||||||||||||||
Debt term | 6 months |