Document and Entity Information
Document and Entity Information - shares | 9 Months Ended | |
Sep. 30, 2016 | Nov. 18, 2016 | |
Document and Entity Information [Abstract] | ||
Entity Registrant Name | SPORTS FIELD HOLDINGS, INC. | |
Entity Central Index Key | 1,539,551 | |
Amendment Flag | false | |
Current Fiscal Year End Date | --12-31 | |
Document Type | 10-Q | |
Document Period End Date | Sep. 30, 2016 | |
Document Fiscal Period Focus | Q3 | |
Document Fiscal Year Focus | 2,016 | |
Entity Filer Category | Smaller Reporting Company | |
Entity Common Stock, Shares Outstanding | 16,935,970 |
Condensed Consolidated Balance
Condensed Consolidated Balance Sheets - USD ($) | Sep. 30, 2016 | Dec. 31, 2015 |
Current assets | ||
Cash | $ 108,388 | $ 61,400 |
Accounts receivable | 14,704 | 151,168 |
Costs and estimated earnings in excess of billings | 247,197 | 137,016 |
Prepaid expenses and other current assets | 198,153 | 10,346 |
Total current assets | 568,442 | 359,930 |
Property, plant and equipment, net | 11,207 | 14,249 |
Deposits | 2,090 | 2,090 |
Total assets | 581,739 | 376,269 |
Current liabilities | ||
Accounts payable and accrued expenses | 1,597,598 | 1,896,557 |
Billings in excess of costs and estimated earnings | 58,375 | |
Provision for estimated losses on uncompleted contracts | 54,106 | 130,046 |
Current maturities of promissory notes | 134,828 | 313,993 |
Convertible notes payable, net of debt discount of $9,421 and $63,631, respectively | 675,889 | 536,369 |
Total current liabilities | 2,520,796 | 2,876,965 |
Long term liabilities | ||
Promissory notes, net of current maturities and debt issuance costs of $37,889 | 712,111 | |
Total long term liabilities | 712,111 | |
Total liabilities | 3,232,907 | 2,876,965 |
Commitments and Contingencies | ||
Stockholders' equity | ||
Preferred stock, $0.00001 par value; 20,000,000 shares authorized, none issued and outstanding | ||
Common stock, $0.00001 par value; 250,000,000 shares authorized, 16,886,653 and 13,915,331 issued and outstanding as of September 30, 2016 and December 31, 2015, respectively | 168 | 138 |
Additional paid in capital | 10,504,962 | 7,773,184 |
Common stock subscription receivable | (4,500) | (4,500) |
Accumulated deficit | (13,151,798) | (10,269,518) |
Total stockholders' equity (deficit) | (2,651,168) | (2,500,696) |
Total liabilities and stockholders' equity (deficit) | $ 581,739 | $ 376,269 |
Condensed Consolidated Balance3
Condensed Consolidated Balance Sheets (Parenthetical) - USD ($) | Sep. 30, 2016 | Dec. 31, 2015 |
Statement of Financial Position [Abstract] | ||
Net of debt discount on convertible notes payable | $ 9,421 | $ 63,631 |
Net of current maturities and debt issuance costs on promissory notes | $ 37,889 | |
Preferred stock, par value | $ 0.00001 | $ 0.00001 |
Preferred stock, shares authorized | 20,000,000 | 20,000,000 |
Preferred stock, shares issued | ||
Preferred stock, shares outstanding | ||
Common stock, par value | $ 0.00001 | $ 0.00001 |
Common stock, shares authorized | 250,000,000 | 250,000,000 |
Common stock, shares issued | 16,886,653 | 13,915,331 |
Common stock, shares outstanding | 16,886,653 | 13,915,331 |
Condensed Consolidated Statemen
Condensed Consolidated Statements of Operations (Unaudited) - USD ($) | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2016 | Sep. 30, 2015 | Sep. 30, 2016 | Sep. 30, 2015 | |
Revenue | ||||
Contract revenue | $ 669,953 | $ 2,092,083 | $ 1,948,511 | $ 3,505,977 |
Total revenue | 669,953 | 2,092,083 | 1,948,511 | 3,505,977 |
Cost of sales | ||||
Contract cost of sales | 571,035 | 2,200,274 | 1,860,115 | 3,671,364 |
Total cost of sales | 571,035 | 2,200,274 | 1,860,115 | 3,671,364 |
Gross profit (loss) | 98,918 | (108,191) | 88,396 | (165,387) |
Operating expenses | ||||
Selling, general and administrative | 684,625 | 651,684 | 2,456,228 | 1,866,282 |
Research & development | 88,447 | |||
Depreciation | 1,014 | 7,225 | 3,042 | 21,676 |
Total operating expenses | 685,639 | 658,909 | 2,547,717 | 1,887,958 |
Loss from operations | (586,721) | (767,100) | (2,459,321) | (2,053,345) |
Other income (expense), net | ||||
Interest, net | (135,764) | (36,029) | (408,367) | (47,956) |
Loss on extinguishment of debt | (35,400) | (35,400) | ||
Miscellaneous income | 20,567 | 4,328 | 20,808 | 4,328 |
Total other income (expense), net | (150,597) | (31,701) | (422,959) | (43,628) |
Loss before income taxes | (737,318) | (798,801) | (2,882,280) | (2,096,973) |
Provision for income taxes | ||||
Net loss | $ (737,318) | $ (798,801) | $ (2,882,280) | $ (2,096,973) |
Net loss per common share, basic and diluted | $ (0.04) | $ (0.06) | $ (0.18) | $ (0.15) |
Weighted average common shares outstanding, basic and diluted | 16,445,711 | 13,608,318 | 15,898,878 | 13,571,356 |
Condensed Consolidated Stateme5
Condensed Consolidated Statements of Cash Flows (Unaudited) - USD ($) | 9 Months Ended | |
Sep. 30, 2016 | Sep. 30, 2015 | |
CASH FLOWS FROM OPERATING ACTIVITIES: | ||
Net loss | $ (2,882,280) | $ (2,096,973) |
Adjustments to reconcile net loss to net cash used in operating activities: | ||
Depreciation | 3,042 | 21,676 |
Amortization of debt issuance costs | 29,648 | 24,722 |
Amortization of debt discount | 175,200 | 25,201 |
Accretion of original issue discount | 23,747 | 8,574 |
Loss on extinguishment of debt | 35,400 | |
Common stock and options issued to consultants and employees | 922,227 | 129,721 |
Changes in operating assets and liabilities: | ||
Accounts receivable | 136,464 | (463,450) |
Prepaid expenses | (93,101) | (45,304) |
Inventory | 62,289 | |
Accounts payable and accrued expenses | (248,649) | 1,362,974 |
Costs and estimated earnings in excess of billings | (110,181) | (196,502) |
Billings in excess of costs and estimated earnings | 58,375 | 3,422 |
Provision for estimated losses on uncompleted contracts | (75,940) | 127,059 |
Net cash used in operating activities | (2,026,048) | (1,036,591) |
CASH FLOWS FROM FINANCING ACTIVITIES: | ||
Proceeds of convertible notes | 150,000 | 585,000 |
Repayments of convertible notes | (150,000) | |
Debt issuance costs | (44,500) | (57,500) |
Proceeds of promissory notes | 800,000 | 355,993 |
Repayments of promissory notes | (323,871) | |
Proceeds from common stock subscriptions | 1,641,407 | |
Net cash provided by financing activities | 2,073,036 | 883,493 |
Increase (decrease) in cash | 46,988 | (153,098) |
Cash, beginning of period | 61,400 | 523,492 |
Cash, end of period | 108,388 | 370,394 |
Cash paid during the period for: | ||
Interest | 79,315 | |
Taxes | ||
Non cash investing and financing activities: | ||
Notes issued for insurance premiums | 94,706 | |
Original issue discount on promissory notes | 8,000 | |
Original issue discount on convertible notes | 15,000 | |
Debt discount - beneficial conversion feature | 67,637 | |
Debt discount paid in the form of common shares | 80,137 | 70,000 |
Stock issuance costs paid in the form of warrants | 76,927 | |
Increase in principal amount of convertible notes in conjunction with debt modification | $ 50,310 |
Description of Business
Description of Business | 9 Months Ended |
Sep. 30, 2016 | |
Description of Business [Abstract] | |
DESCRIPTION OF BUSINESS | NOTE 1 – DESCRIPTION OF BUSINESS Sports Field Holdings, Inc. (the “Company”, “Sports Field Holdings”, “we”, “our”, or “us”) is a Nevada corporation engaged in product development, engineering, manufacturing, and the construction, design and building of athletic facilities, as well as supplying its own proprietary high end synthetic turf products to the sports industry. The accompanying unaudited condensed consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”) for interim financial information. Accordingly, they do not include all of the information and disclosures required by GAAP for annual financial statements. In the opinion of management, such statements include all adjustments (consisting only of normal recurring items) which are considered necessary for a fair presentation of the condensed financial position of the Company as of September 30, 2016 and the results of operations for the three and nine months ended September 30, 2016 and cash flows for the nine months ended September 30, 2016. The results of operations for the three and nine months ended September 30, 2016 are not necessarily indicative of the operating results for the full year ending December 31, 2016 or any other period. These condensed consolidated financial statements should be read in conjunction with the consolidated financial statements and related disclosures of the Company as of December 31, 2015 and for the year then ended, which were filed with the Securities and Exchange Commission (“SEC”) on Form 10-K on April 12, 2016. |
Significant Accounting Policies
Significant Accounting Policies | 9 Months Ended |
Sep. 30, 2016 | |
Significant Accounting Policies [Abstract] | |
SIGNIFICANT ACCOUNTING POLICIES | NOTE 2 – SIGNIFICANT ACCOUNTING POLICIES Principles of Consolidation The accompanying condensed consolidated financial statements include the accounts of Sports Field Holdings, Inc. and its wholly owned subsidiaries. All significant intercompany accounts and transactions have been eliminated in consolidation. Use of Estimates The preparation of condensed consolidated financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent liabilities at the date of the condensed consolidated financial statements and the reported amounts of revenue and expenses during the periods. Actual results could differ from those estimates. The Company’s significant estimates and assumptions include the accounts receivable allowance for doubtful accounts, percentage of completion revenue recognition method, the useful life of fixed assets and assumptions used in the fair value of stock-based compensation. Revenues and Cost Recognition Revenues from construction contracts are included in contract revenue in the condensed consolidated statements of operations and are recognized under the percentage-of-completion accounting method. The percent complete is measured by the cost incurred to date compared to the estimated total cost of each project. This method is used as management considers expended cost to be the best available measure of progress on these contracts, the majority of which are completed within one year, but may occasionally extend beyond one year. Inherent uncertainties in estimating costs make it at least reasonably possible that the estimates used will change within the near term and over the life of the contracts. Contract costs include all direct material and labor costs and those indirect costs related to contract performance and completion. Provisions for estimated losses on uncompleted contracts are made in the period in which such losses are determined. General and administrative costs are charged to expense as incurred. Changes in job performance, job conditions and estimated profitability, including those arising from contract penalty provisions and final contract settlements, may result in revisions to costs and income. Such revisions are recognized in the period in which they are determined. Costs and estimated earnings in excess of billings are comprised principally of revenue recognized on contracts (on the percentage-of-completion method) for which billings had not been presented to customers because the amounts were not billable under the contract terms at the balance sheet date. In accordance with the contract terms, any unbilled receivables at period end will be billed subsequently. Amounts are billed based on contractual terms. Billings in excess of costs and estimated earnings represent billings in excess of revenues recognized. Cash and Cash Equivalents The Company considers all short-term highly liquid investments with a remaining maturity at the date of purchase of three months or less to be cash equivalents. As of September 30, 2016 and December 31, 2015 the company did not have any cash equivalents. Property, Plant and Equipment Property, plant and equipment are carried at cost less accumulated depreciation and amortization. Depreciation and amortization are calculated using the straight-line method over the estimated useful lives of the assets, which generally range from 3 to 5 years. Gains and losses from the retirement or disposition of property and equipment are included in operations in the period incurred. Maintenance and repairs are expensed as incurred. Stock-Based Compensation The Company measures the cost of services received in exchange for an award of equity instruments based on the fair value of the award. For employees, the fair value of the award is measured on the grant date and for non-employees, the fair value of the award is generally re-measured on vesting dates and interim financial reporting dates until the service period is complete. The fair value amount is then recognized over the period during which services are required to be provided in exchange for the award, usually the vesting period. Awards granted to directors are treated on the same basis as awards granted to employees. Concentrations of Credit Risk Financial instruments and related items, which potentially subject the Company to concentrations of credit risk, consist primarily of cash and cash equivalents. The Company places its cash and temporary cash investments with credit quality institutions. At times, such amounts may be in excess of the FDIC insurance limit. Accounts Receivable and Allowance for Doubtful Accounts Accounts receivable are stated at the amount management expects to collect from outstanding balances. The Company generally does not require collateral to support customer receivables. The Company provides an allowance for doubtful accounts based upon a review of the outstanding accounts receivable, historical collection information and existing economic conditions. The Company determines if receivables are past due based on days outstanding, and amounts are written off when determined to be uncollectible by management. The maximum accounting loss from the credit risk associated with accounts receivable is the amount of the receivable recorded, which is the face amount of the receivable, net of the allowance for doubtful accounts. As of September 30, 2016 and December 31, 2015, the Company’s accounts receivable balance was $14,704 and $151,168, respectively, and the allowance for doubtful accounts is $0 in each period. Research and Development Research and development expenses are charged to operations as incurred. For the three months ended September 30, 2016 and 2015, the Company incurred research and development expenses of $0 and $0, respectively. For the nine months ended September 30, 2016 and 2015, the Company incurred research and development expenses of $88,447 and $0, respectively. Warranty Costs The Company generally provides a warranty on the products installed for up to 8 years with certain limitations and exclusions based upon the manufacturer’s product warranty; therefore the Company does not believe a warranty reserve is required as of September 30, 2016 and December 31, 2015. Fair Value of Financial Instruments Accounting Standards Codification subtopic 825-10, Financial Instruments (“ASC 825-10”) requires disclosure of the fair value of certain financial instruments. The carrying value of cash and cash equivalents, accounts payable and accrued liabilities, and short-term borrowings, as reflected in the balance sheets, approximate fair value because of the short-term maturity of these instruments. All other significant financial assets, financial liabilities and equity instruments of the Company are either recognized or disclosed in the financial statements together with other information relevant for making a reasonable assessment of future cash flows, interest rate risk and credit risk. Where practicable the fair values of financial assets and financial liabilities have been determined and disclosed; otherwise only available information pertinent to fair value has been disclosed. Beneficial Conversion Feature For conventional convertible debt where the rate of conversion is below market value, the Company records a “beneficial conversion feature” (“BCF”) and related debt discount. When the Company records a BCF the relative fair value of the BCF would be recorded as a debt discount against the face amount of the respective debt instrument. The debt discount attributable to the BCF is amortized over the period from issuance to the date that the debt matures. Derivative Instruments The Company evaluates its convertible debt, warrants or other contracts to determine if those contracts or embedded components of those contracts qualify as derivatives to be separately accounted for in accordance with ASC 815-15. The result of this accounting treatment is that the fair value of the embedded derivative is marked-to-market each balance sheet date and recorded as a liability. In the event that the fair value is recorded as a liability, the change in fair value is recorded in the statements of operations as other income or expense. Upon conversion or exercise of a derivative instrument, the instrument is marked to fair value at the conversion date and then that fair value is reclassified to equity. In circumstances where the embedded conversion option in a convertible instrument is required to be bifurcated and there are also other embedded derivative instruments in the convertible instrument that are required to be bifurcated, the bifurcated derivative instruments are accounted for as a single, compound derivative instrument. The classification of derivative instruments, including whether such instruments should be recorded as liabilities or as equity, is re-assessed at the end of each reporting period. Equity instruments that are initially classified as equity that become subject to reclassification are reclassified to liability at the fair value of the instrument on the reclassification date. Net Income (Loss) Per Common Share The Company computes basic net income (loss) per share by dividing net income (loss) per share available to common stockholders by the weighted average number of common shares outstanding for the period and excludes the effects of any potentially dilutive securities. Diluted earnings per share, if presented, would include the dilution that would occur upon the exercise or conversion of all potentially dilutive securities into common stock using the “treasury stock” and/or “if converted” methods as applicable. The computation of basic and diluted loss per share excludes potentially dilutive securities because their inclusion would be anti-dilutive. Anti-dilutive securities excluded from the computation of basic and diluted net loss per share for the nine months ended September 30, 2016 and 2015, respectively, are as follows: September 30, 2016 2015 Warrants to purchase common stock 679,588 500,000 Options to purchase common stock 622,500 430,000 Unvested restricted common shares 217,593 - Convertible Notes 2,102,615 616,310 Totals 3,622,296 1,546,310 Shares outstanding Shares outstanding include shares of unvested restricted stock. Unvested restricted stock included in reportable shares outstanding was 217,593 and 0 shares as of September 30, 2016 and 2015, respectively. Shares of unvested restricted stock are excluded from our calculation of basic weighted average shares outstanding, but their dilutive impact is added back in the calculation of diluted weighted average shares outstanding. Significant Customers The Company’s business focuses on securing a smaller number of high quality, highly profitable projects, which sometimes results in having a concentration of sales and accounts receivable among a few customers. This concentration is customary among the design and build industry for a company of our size. As we continue to grow and are awarded more projects, this concentration will continue to decrease. At September 30, 2016, the Company had one customer representing 100.0% of the total accounts receivable balance. At December 31, 2015, the Company had two customers representing 94% of the total accounts receivable balance. For the three months ended September 30, 2016, the Company had four customers that represented 10%, 17%, 28%, and 43% of the total revenue and for the three months ended September 30, 2015, the Company had three customers that represented 14%, 62% and 23% of the total revenue. For the nine months ended September 30, 2016, the Company had five customers that represented 15%, 33%, 17%, 11% and 15% of the total revenue and for the nine months ended September 30, 2015, the Company had four customers that represented 18%, 28%, 39%, and 13% of the total revenue. Reclassifications Certain items in the prior year financial statements have been reclassified to conform to the current year presentation. Recently Adopted Accounting Guidance In April 2015, the FASB issued Accounting Standards Update No. 2015-03, Interest - Imputation of Interest (Subtopic 835-30): Simplifying the Presentation of Debt Issuance Costs In June 2014, the Financial Accounting Standards Board issued Accounting Standards Update 2014-12, Compensation-Stock Compensation Recent Accounting Guidance Not Yet Adopted During May 2014, the FASB issued ASU No. 2014-09, “Revenue from Contracts with Customers” (“ASU 2014-09”), which requires entities to recognize revenue in a way that depicts the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled to in exchange for those goods or services. The new guidance also requires additional disclosure about the nature, amount, timing and uncertainty of revenue and cash flows arising from customer contracts, including significant judgments and changes in judgments and assets recognized from costs incurred to obtain or fulfill a contract. In July 2015, the FASB voted to delay the effective date of ASU 2014-09 by one year to the first quarter of 2018 to provide companies sufficient time to implement the standards. Early Adoption will be permitted, but not before the first quarter of 2017. Adoption can occur using one of two prescribed transition methods. The Company is currently evaluating the impact of the new standard. In August 2014, the Financial Accounting Standards Board issued Accounting Standards Update 2014-15, Presentation of Financial Statements-Going Concern. In February 2016, the Financial Accounting Standards Board ("FASB") issued Accounting Standards Update ("ASU") No. 2016-02, “Leases” (topic 842). The FASB issued this update to increase transparency and comparability among organizations by recognizing lease assets and lease liabilities on the balance sheet and disclosing key information about leasing arrangements. The updated guidance is effective for annual periods beginning after December 15, 2018, including interim periods within those fiscal years. Early adoption of the update is permitted. The Company is currently evaluating the impact of the new standard. In March 2016, the Financial Accounting Standards Board ("FASB") issued Accounting Standards Update ("ASU") No. 2016-06, “Derivatives and Hedging” (topic 815). The FASB issued this update to clarify the requirements for assessing whether contingent call (put) options that can accelerate the payment of principal on debt instruments are clearly and closely related to their debt hosts. An entity performing the assessment under the amendments in this update is required to assess the embedded call (put) options solely in accordance with the four-step decision sequence. The updated guidance is effective for annual periods beginning after December 15, 2016, including interim periods within those fiscal years. Early adoption of the update is permitted. The Company is currently evaluating the impact of the new standard. In April 2016, the Financial Accounting Standards Board ("FASB") issued Accounting Standards Update ("ASU") No. 2016-09, “Compensation – Stock Compensation” (topic 718). The FASB issued this update to improve the accounting for employee share-based payments and affect all organizations that issue share-based payment awards to their employees. Several aspects of the accounting for share-based payment award transactions are simplified, including: (a) income tax consequences; (b) classification of awards as either equity or liabilities; and (c) classification on the statement of cash flows. The updated guidance is effective for annual periods beginning after December 15, 2016, including interim periods within those fiscal years. Early adoption of the update is permitted. The Company is currently evaluating the impact of the new standard. In April 2016, the Financial Accounting Standards Board (‘FASB”) issued Accounting Standards Update (“ASU”) No. 2016-10, “Revenue from Contracts with Customers: Identifying Performance Obligations and Licensing” (topic 606). In March 2016, the Financial Accounting Standards Board (‘FASB”) issued Accounting Standards Update (“ASU”) No. 2016-08, “Revenue from Contracts with Customers: Principal versus Agent Considerations (Reporting Revenue Gross verses Net)” (topic 606). These amendments provide additional clarification and implementation guidance on the previously issued ASU 2014-09, “Revenue from Contracts with Customers”. The amendments in ASU 2016-10 provide clarifying guidance on materiality of performance obligations; evaluating distinct performance obligations; treatment of shipping and handling costs; and determining whether an entity's promise to grant a license provides a customer with either a right to use an entity's intellectual property or a right to access an entity's intellectual property. The amendments in ASU 2016-08 clarify how an entity should identify the specified good or service for the principal versus agent evaluation and how it should apply the control principle to certain types of arrangements. The adoption of ASU 2016-10 and ASU 2016-08 is to coincide with an entity's adoption of ASU 2014-09, which we intend to adopt for interim and annual reporting periods beginning after December 15, 2017. The Company is currently evaluating the impact of the new standard. In August 2016, the Financial Accounting Standards Board (‘FASB”) issued Accounting Standards Update (“ASU”) No. 2016-15, "Statement of Cash Flows - Classification of Certain Cash Receipts and Cash Payments." ASU No. 2016-15 addresses specific cash flow classification issues where there is currently diversity in practice including debt prepayment and proceeds from the settlement of insurance claims. ASU 2016-15 is effective for annual periods beginning after December 15, 2017, with early adoption permitted. The Company is currently evaluating the impact of the new standard. There were no other new accounting pronouncements that were issued or became effective since the issuance of our 2015 Annual Report on Form 10-K that had, or are expected to have, a material impact on our condensed consolidated financial position, results of operations or cash flows. Subsequent Events Management has evaluated subsequent events or transactions occurring through the date on which the financial statements were issued. Based upon the evaluation, the Company did not identify any recognized or non-recognized subsequent events that would have required adjustment or disclosure in the condensed consolidated financial statements, except as disclosed. |
Going Concern
Going Concern | 9 Months Ended |
Sep. 30, 2016 | |
Going Concern [Abstract] | |
GOING CONCERN | NOTE 3 – GOING CONCERN As reflected in the accompanying condensed consolidated financial statements, as of September 30, 2016 the Company had a working capital deficit of $(1,952,354). Furthermore, the Company had a net loss and net cash used in operations of $(2,882,280) and $(2,026,048), respectively, for the nine months ended September 30, 2016 and an accumulated deficit totaling $(13,151,798). These factors raise substantial doubt about the Company’s ability to continue as a going concern. The ability of the Company to continue its operations as a going concern is dependent on Management's plans, which include the raising of capital through debt and/or equity markets with some additional funding from other traditional financing sources, including but not limited to term notes, until such time that funds provided by operations are sufficient to fund working capital requirements. The Company will require additional funding to finance the growth of its current and expected future operations as well as to achieve its strategic objectives. The Company believes its current available cash along with anticipated revenues may be insufficient to meet its cash needs for the near future. There can be no assurance that financing will be available in amounts or terms acceptable to the Company, if at all. The accompanying condensed consolidated financial statements have been prepared on a going concern basis, which contemplates the realization of assets and the satisfaction of liabilities in the normal course of business. These financial statements do not include any adjustments relating to the recovery of the recorded assets or the classification of the liabilities that might be necessary should the Company be unable to continue as a going concern. |
Costs and Estimated Earnings on
Costs and Estimated Earnings on Contracts in Process | 9 Months Ended |
Sep. 30, 2016 | |
Costs and Estimated Earnings on Contracts in Process [Abstract] | |
COSTS AND ESTIMATED EARNINGS ON CONTRACTS IN PROCESS | NOTE 4 – COSTS AND ESTIMATED EARNINGS ON CONTRACTS IN PROCESS Following is a summary of costs, billings, and estimated earnings on contracts in process as of September 30, 2016 and December 31, 2015: September 30, December 31, 2016 2015 Costs incurred on contracts in progress $ 5,243,778 $ 5,395,046 Estimated earnings (losses) (524,331 ) (863,259 ) 4,719,447 4,531,787 Less billings to date (4,584,731 ) (4,524,817 ) $ 134,716 $ 6,970 The above accounts are shown in the accompanying condensed consolidated balance sheet under these captions at September 30, 2016 and December 31, 2015: September 30, December 31, 2016 2015 Costs and estimated earnings in excess of billings $ 247,197 $ 137,016 Billings in excess of costs and estimated earnings (58,375 ) - Provision for estimated losses on uncompleted contracts (54,106 ) (130,046 ) $ 134,716 $ 6,970 Warranty Costs During the three and nine months ended September 30, 2016 the Company incurred costs of approximately $103,600 and $121,000, respectively. A substantial amount of the warranty costs incurred during the three and nine months ended September 30, 2016 related to subgrade infill materials used on a 2015 project. Since then, neither this supplier nor this infill material has been used again. During the three and nine months ended September 30, 2015 the Company incurred costs of approximately $21,863 and $227,863, respectively, relating to the installation of materials by a subcontractor that has been released from the Company. The Company has implemented policies and procedures to avoid these costs in the future. The Company generally provides a warranty on the products installed for up to 8 years with certain limitations and exclusions based upon the manufacturer’s product warranty; therefore, the Company does not believe a warranty reserve is required as of September 30, 2016. |
Property, Plant and Equipment
Property, Plant and Equipment | 9 Months Ended |
Sep. 30, 2016 | |
Property, Plant and Equipment [Abstract] | |
PROPERTY, PLANT AND EQUIPMENT | NOTE 5 – PROPERTY, PLANT AND EQUIPMENT Property, plant and equipment consists of the following: September 30, December 31, Furniture and equipment $ 20,278 $ 20,278 Total 20,278 20,278 Less: accumulated depreciation (9,071 ) (6,029 ) $ 11,207 $ 14,249 Depreciation expense for the three and nine months ended September 30, 2016 was $1,014 and $3,042, respectively. Depreciation expense for the three and nine months ended September 30, 2015 was $7,225 and $21,676, respectively. |
Debt
Debt | 9 Months Ended |
Sep. 30, 2016 | |
Debt [Abstract] | |
DEBT | NOTE 6 – DEBT Convertible Notes On May 7, 2015, the Company issued unsecured convertible promissory notes (each a “Note” and collectively the “Notes”) in an aggregate principal amount of $450,000 to three accredited investors (collectively the “Note Holders”) through a private placement. The notes pay interest equal to 9% of the principal amount of the notes, payable in one lump sum, and mature on February 1, 2016 unless the notes are converted into common stock if the Company undertakes a qualified offering of securities of at least $2,000,000 (the “Qualified Offering”). The principal of the notes are convertible into shares of common stock at a conversion price that is the lower of $1.00 per share or the price per share offered in a Qualified Offering. In order to induce the investors to invest in the notes, one of the Company’s shareholders assigned an aggregate of 45,000 shares of his common stock to such investors. The Company recorded a $45,000 debt discount relating to the 45,000 shares of common stock issued with an offsetting entry to additional paid in capital. The debt discount shall be amortized to interest expense over the life of the notes. As part of the transaction, we incurred placement agent fees of $22,500 and legal fees of $22,500 which were recorded as debt issue costs and shall be amortized over the life of the notes. The outstanding principal balance on the notes at December 31, 2015 was $450,000. The notes matured on February 1, 2016. On March 31, 2016, the Note Holders entered into a letter agreement whereby, effective as of February 1, 2016, they waived any and all defaults that may or may not have occurred prior to the date thereof (the “First Waiver”). As consideration for the First Waiver, the Company issued the Note Holders an aggregate of 45,000 shares of the Company’s common stock. The principal amount on the Notes increased from $450,000 to $490,500 as the initial interest amount, $40,500 as of February 1, 2016, was added to the principal amount of the Notes. The maturity date of the Notes was extended to July 1, 2016 and the Notes shall pay interest as of February 1, 2016 at a rate of 9% per annum, payable in one lump sum on the maturity date. In addition, on any note conversion date from February 1, 2016 through July 1, 2016, the Notes are convertible into shares of the Company’s common stock at a conversion price of $1.00 per share. On any Note conversion after July 1, 2016, the Notes are convertible into shares of the Company’s common stock at a conversion price that is the lower of (i) $1.00 per share and (ii) the volume-weighted average price for the last five trading days preceding the conversion date. All remaining terms of the Notes remained the same. Subsequent to the First Waiver, the Notes matured on July 1, 2016. On September 7, 2016, one Note Holder entered into a letter agreement whereby, effective as of August 1, 2016, they waived any and all defaults that may or may not have occurred prior to the date thereof (the “Second Waiver”). As consideration for the Second Waiver, the Company issued the Note Holder an aggregate of 40,000 shares of the Company’s common stock and added $15,000 to the principal amount of the note. The principal amount on the Note increased from $218,000 to $242,810 as the accrued interest amount, $9,810 as of August 1, 2016 and the aforementioned $15,000 of consideration, was added to the principal amount of the Note. The maturity date of the Note was extended to January 1, 2017 and the Note shall pay interest as of August 1, 2016 at a rate of 15% per annum, payable in one lump sum on the maturity date. In addition, on any note conversion date from August 9, 2016 through January 1, 2017, the Note is convertible into shares of the Company’s common stock at a conversion price of $1.00 per share. On any Note conversion after January 1, 2017, the Note is convertible into shares of the Company’s common stock at a conversion price that is the lower of (i) $1.00 per share and (ii) the volume-weighted average price for the last five trading days preceding the conversion date. All remaining terms of the Note remained the same. On October 21, 2016, a second Note Holder entered into a letter agreement whereby, effective as of August 1, 2016, they waived any and all defaults that may or may not have occurred prior to the date thereof (the “Second Waiver”). As consideration for the Second Waiver, the Company issued the Note Holder an aggregate of 30,000 shares of the Company’s common stock. The principal amount on the Note increased from $163,500 to $170,858 as the accrued interest amount, $7,358 as of August 1, 2016, was added to the principal amount of the Note. The maturity date of the Note was extended to January 1, 2017 and the Note shall pay interest as of August 1, 2016 at a rate of 15% per annum, payable in one lump sum on the maturity date. In addition, on any note conversion date from August 9, 2016 through January 1, 2017, the Note is convertible into shares of the Company’s common stock at a conversion price of $1.00 per share. On any Note conversion after January 1, 2017, the Note is convertible into shares of the Company’s common stock at a conversion price that is the lower of (i) $1.00 per share and (ii) the volume-weighted average price for the last five trading days preceding the conversion date. All remaining terms of the Note remained the same. Glenn Tilley, a director of the Company, is the holder of $163,500 of principal as of September 30, 2016 of the aforementioned Notes. As of July 1, 2016, the Company was not compliant with the repayment terms of one of the Notes but no defaults under the Note have been called by the Note Holder. As September 30, 2016, the outstanding principal balance on the Note was $109,000. The Company is currently conducting good faith negotiations with the Note Holder to further extend the maturity date, however, there can be no assurance that a further extension will be granted. The Company is currently accruing interest on the Note at the default interest rate of 15% per annum. First Waiver In accordance with ASC 470, since the present value of the cash flows under the new debt instrument was not at least ten percent different from the present value of the remaining cash flows under the terms of the original debt instrument, the Company accounted for the First Waiver as a debt modification. Accordingly, the Company recorded a debt discount of $49,500 in the condensed consolidated balance sheet. The debt discount shall be amortized to interest expense over the life of the note. Second Waiver In accordance with ASC 470, since the present value of the cash flows under the new debt instrument was at least ten percent different from the present value of the remaining cash flows under the terms of the original debt instrument, the Company accounted for the Second Waiver as a debt extinguishment. Accordingly, the Company recorded a loss on extinguishment of debt of $35,400 in the condensed consolidated statement of operations. The Company assessed the conversion feature of the Note in default at the end of the reporting period and concluded the conversion feature of the Note did not qualify as a derivative because there is no market mechanism for net settlement and it is not readily convertible to cash. The Company will reassess the conversion feature of the Note for derivative treatment at the end of each subsequent reporting period. On August 19, 2015, we entered into a Securities Purchase Agreement (the “Agreement”) with a private investor (the “Investor”). Under the Agreement, the Investor agreed to purchase convertible debentures in the aggregate principal amount of up to $450,000 (together the “Debentures” and each individual issuance a “Debenture”), bearing interest at a rate of 0% per annum, with maturity on the thirty-six (36) month anniversary of the respective date of issuance. On the Initial Closing Date, we issued and sold to the Investor, and the Investor purchased from us, a first Debenture in the principal amount of $150,000 for a purchase price of $135,000. $15,000 was recorded as an original issue discount and will be accreted over the life of the note to interest expense. The Agreement provides that, subject to our compliance with certain conditions to closing, at the request of the Company and approval by the Investor, (i) we will issue and sell to the Investor, and the Investor will purchase from us, a second Debenture in the principal amount of $150,000 for a purchase price of $135,000 and (ii) thereafter, we will issue and sell to the Investor, and the Investor will purchase from us, a third Debenture in the principal amount of $150,000 for a purchase price of $135,000. The principal amount of the Debentures can be converted at the option of the Investor into shares of our common stock at a conversion price per share of $1.00 until the six month anniversary of each closing date. If the Debenture is not repaid within six months, the Investor will be able to convert such Debenture at a conversion price equal to 65% of the lowest closing bid price for our common stock during the previous 20 trading days, subject to the terms and conditions contained in the Debenture. If the Debentures are repaid within 90 days of the date of issuance, there is no prepayment penalty or premium. Following such time, a prepayment penalty or premium will apply. As part of the transaction, we agreed to pay the Investor $5,000 and issue 25,000 shares of our Common Stock for certain due diligence and other transaction related costs. In-addition the Company incurred placement agent fees of $7,500 and legal fees of $7,500. The Company recorded a $25,000 debt discount relating to the 25,000 shares of common stock issued. The debt discount shall be amortized to interest expense over the life of the note. The remaining fees were recorded as debt issue costs and shall be amortized over the life of the note. The Company assessed the conversion feature of the Debentures on the date of issuance and at end of each subsequent reporting period and concluded the conversion feature of the Debentures do not qualify as a derivative because there is no market mechanism for net settlement and it is not readily convertible to cash. The Company will reassess the conversion feature of the Debentures for derivative treatment at the end of each subsequent reporting period. The outstanding principal balance on the Debentures at December 31, 2015 was $150,000. On February 19, 2016, the Company paid the Debentures in full along with a prepayment penalty in the amount of $45,000. On February 22, 2016 (the “Effective Date”), the Company issued a convertible note in the principal aggregate amount of $170,000 to a private investor. The note pays interest at a rate of 12% per annum and matures on August 19, 2016 (the “Maturity Date”). The Note is convertible into shares of the Company’s common stock at a conversion price equal to: (i) from the Effective Date through the Maturity Date at $1.00 per share; and (ii) beginning one day after the Maturity Date, or notwithstanding the foregoing, at any time after the Company has registered shares of its common stock underlying the Note in a registration statement on Form S-1 or any other form applicable thereto, the lower of i) $1.00 per share and ii) 60% of the volume-weighted average price for the last twenty trading days preceding the conversion date. The Company used the proceeds of the note to pay off a debenture issued in favor of a private investor on August 19, 2015. The debenture was in the principal amount of $150,000 and as of the date of this filing the investor has been paid all principal and interest due in full satisfaction thereof. As additional consideration for issuing the note, on the Effective Date the Company issued to the investor 35,000 shares of the Company’s restricted common stock. The Company recorded a $30,637 debt discount relating to the 35,000 shares of common stock issued. The debt discount was amortized to interest expense over the life of the convertible note. The intrinsic value of the convertible note, when issued, gave rise to a beneficial conversion feature which was recorded as a discount to the note of $67,637 and was amortized over the period from issuance to the date that the debt matured. The Company assessed the conversion feature of the note on the date of issuance, on the date of default and at the end of each subsequent reporting period and concluded the conversion feature of the note did not qualify as a derivative because there is no market mechanism for net settlement and it is not readily convertible to cash. The Company will reassess the conversion feature of the note for derivative treatment at the end of each subsequent reporting period. The outstanding principal balance on the convertible note at September 30, 2016 was $170,000. As of August 19, 2016, the Company is not compliant with the repayment terms of this note but no defaults under the note have been called by the note holder. The Company is currently conducting good faith negotiations with the note holder to further extend the maturity date, however, there can be no assurance that a further extension will be granted. The Company recorded $17,850 in penalty interest during the nine months ended September 30, 2016 as a result of the default. Accrued interest on this note is $18,525 as of September 30, 2016. Promissory Notes On September 15, 2015, the Company entered into a short term loan agreement with an investor. The principal amount of the loan was $200,000. The first $100,000 of the loan is payable upon the Company raising $500,000 in a qualified offering (as defined therein). The remaining balances is payable upon the Company raising $1,000,000 in a qualified offering. The loan bears interest at a rate of 8%. As part of the transaction, we incurred placement agent fees of $10,000 which were recorded as debt issue costs and shall be amortized over the life of the loan. On May 3, 2016, the Company paid 10,000 in note principal and $10,000 of accrued interest on the loan and the Company entered into a promissory note with the lender for the remaining principal amount of $190,000. Pursuant to the terms of the promissory note agreement, the note bears interest at a rate of 8% and requires the Company to make one monthly principal payment of $10,000, one monthly principal payment of $12,500, eleven monthly principal payments of $15,000 and one monthly principal payment of $2,500, all along with interest starting on June 1, 2016. The note matures on July 1, 2017 and is unsecured. The outstanding principal balance on the note at September 30, 2016 was $127,500. On September 21, 2015, the Company entered into a promissory note with an investor in the principal amount of $163,993. The Company received proceeds of $155,993 and $8,000 was recorded as an original issue discount which will be accreted over the life of the note to interest expense. The promissory note is due on demand and carries a 5.0% interest rate. The promissory note is secured by all assets of the Company. On November 17, 2015, the Company paid $50,000 of principal on the note. The outstanding principal balance on the note at December 31, 2015 was $113,993. During the six months ended June 30, 2016, the Company paid the remaining note principal of $113,993 in full. As of September 30, 2016, accrued interest due was $2,486. On January 26, 2016, the Company entered into a finance agreement with IPFS Corporation (“IPFS”). Pursuant to the terms of the agreement, IPFS loaned the Company the principal amount of $65,006, which would accrue interest at 3.5% per annum, to partially fund the payment of the premium of the Company’s general liability insurance. The agreement requires the Company to make nine monthly payments of $7,328, including interest starting on February 27, 2016. As of September 30, 2016, the outstanding balance related to this finance agreement was $7,328. On November 30, 2015, the Company entered into a finance agreement with First Insurance Funding (“FIF”). Pursuant to the terms of the agreement, FIF loaned the Company the principal amount of $29,700, which would accrue interest at 3.8% per annum, to partially fund the payment of the premium of the Company’s directors and officers insurance. The agreement requires the Company to make nine monthly payments of $3,352.47, including interest starting on January 3, 2016. On July 14, 2016, the Company closed a Credit Agreement (the “Credit Agreement”) by and among the Company and First Form, Inc. (the “Borrowers”) and Genlink Capital, LLC, as lender (“Genlink”). Pursuant to the Credit Agreement, Genlink agreed to loan the Company up to a maximum of $1 million for general operating expenses. An initial amount of $670,000 was funded by Genlink at the closing of the Credit Agreement. Any increase in the amount extended to the Borrowers shall be at the discretion of Genlink. The amounts borrowed pursuant to the Credit Agreement are evidenced by a Revolving Note (the “Revolving Note”) and the repayment of the Revolving Note is secured by a first position security interest in substantially all of the Company’s assets in favor of Genlink, as evidenced by a Security Agreement by and among the Borrowers and Genlink (the “Security Agreement”). The Revolving Note is due and payable, along with interest thereon, on December 20, 2017, and bears interest at the rate of 15% per annum, increasing to 19% upon the occurrence of an event of default. The Company incurred loan fees of $44,500 for entering into the Credit Agreement. The loan fees shall be amortized to interest expense over the life of the notes. The Company must pay a minimum of $75,000 in interest over the life of the loan. The principal balance on the note as of September 30, 2016 was $750,000. The principal balance on the note as of the date of this filing was $925,000. Debt under promissory notes is as follows: September 30, 2015 December 31, 2015 Promissory notes payable $ 877,500 $ 313,993 Less: Current maturities (127,500 ) - Less: Debt issuance costs (37,889 ) - Promissory notes payable, net of Current maturities and debt issuance costs $ 712,111 $ 313,993 Future minimum principal payments under promissory notes are as follows: Year ending December 31: 2016 – (Remainder of year) $ 45,000 2017 832,500 2018 and thereafter - $ 877,500 |
Factor Agreement
Factor Agreement | 9 Months Ended |
Sep. 30, 2016 | |
Factor Agreement [Abstract] | |
FACTOR AGREEMENT | NOTE 7- FACTOR AGREEMENT On March 28, 2016, the Company entered into an agreement with a financial services company (the “Factor”) for the purchase and sale of accounts receivables. The financial services company advances up to 80% of qualified customer invoices and holds the remaining 20% as a reserve until the customer pays the financial services company. The released reserves are returned to the Company, less applicable discount fees. The Company is initially charged 2.0% on the face value of each invoice purchased and 0.008% for every 30 days the invoice remains outstanding. Uncollectable customer invoices are charged back to the Company after 90 days. During the nine months ended September 30, 2016, accounts receivable purchased by the Factor amounted to $353,648 and advances from the Factor amounted to $282,917. At September 30, 2016 no amounts were due to the Factor. Advances from the Factor are collateralized by all accounts receivable of the Company. |
Stockholders Equity (Deficit)
Stockholders Equity (Deficit) | 9 Months Ended |
Sep. 30, 2016 | |
Stockholders Equity (Deficit) [Abstract] | |
STOCKHOLDERS EQUITY (DEFICIT) | NOTE 8- STOCKHOLDERS EQUITY (DEFICIT) Preferred Stock The Company has authorized 20,000,000 shares of preferred stock, with a par value of $0.00001 per share. As of September 30, 2016 and December 31, 2015, the Company has -0- shares of preferred stock issued and outstanding. Common Stock The Company has authorized 250,000,000 shares of common stock, with a par value of $0.00001 per share. As of September 30, 2016 and December 31, 2015, the Company has 16,886,653 and 13,915,331 shares of common stock issued and outstanding, respectively. Common stock issued in placement of debt As part of a securities purchase agreement entered into on February 19, 2016, we agreed to issue an investor 35,000 shares of our common stock. Common stock issued in debt modification As part of a debt modification entered into on March 31, 2016, we agreed to issue three investors an aggregate of 45,000 shares of our common stock. As part of a debt modification entered into on September 7, 2016, the Company agreed to issue an investor 40,000 shares of our common stock. Common stock issued for services On March 31, 2016, 1,000 shares of common stock were granted to a certain employee with a fair value of $1,100. On June 30, 2016, 1,500 shares of common stock were granted to a certain employee with a fair value of $1,650. On September 30, 2016, 1,500 shares of common stock were granted to a certain employee with a fair value of $495. During the nine months ended September 30, 2016, 882,127 shares of common stock valued at $648,839 were issued to various consultants for professional services provided to the Company. As discussed in Note 10, Jeromy Olson was issued 250,000 shares of common stock valued at $275,000 as per the terms of his employment agreement with the company as Chief Executive Officer. Sale of common stock During the nine months ended September 30, 2016, the Company sold 1,715,195 shares of common stock to investors in exchange for $1,886,712 in gross proceeds in connection with the private placement of the Company’s common stock. In connection with the private placement the Company incurred fees of $245,305. In addition, 171,520 five year warrants with an exercise price of $1.10 were issued to the placement agent. The Company valued the warrants at $76,927 on the commitment date using a Black-Scholes-Merton option pricing model. The value of the warrants was a direct cost of the private placement and has been recorded as a reduction in additional paid in capital. Stock options issued for services During the nine months ended September 30, 2016, the Company's board of directors authorized the grant of 200,000 stock options, having a total fair value of approximately $97,500, with a vesting period of 2.00 years. These options expire on January 4, 2021. The Company uses the Black-Scholes option pricing model to determine the fair value of the options granted. In applying the Black-Scholes option pricing model to options granted, the Company used the following weighted average assumptions: For the Nine Months Ended September 30, 2016 Risk free interest rate 1.73 % Dividend yield 0.00 % Expected volatility 45.25 % Expected life in years 5 Forfeiture Rate 0.00 % Since the Company has limited trading history, volatility was determined by averaging volatilities of comparable companies. The expected term of the option, taking into account both the contractual term of the option and the effects of employees’ expected exercise and post-vesting employment termination behavior: The expected life of options and similar instruments represents the period of time the option and/or warrant are expected to be outstanding. Pursuant to paragraph 718-10-S99-1, it may be appropriate to use the simplified method i.e., expected term = ((vesting term + original contractual term) / 2) The following is a summary of the Company’s stock option activity during the nine months ended September 30, 2016: Number of Options Weighted Average Exercise Price Weighted Average Remaining Contractual Life Outstanding - January 31, 2016 430,000 $ 1.03 5.00 Granted 200,000 1.00 5.00 Exercised - - - Forfeited/Cancelled (7,500 ) 1.50 - Outstanding - September 30, 2016 622,500 $ 1.02 3.82 Exercisable - September 30, 2016 422,500 $ 1.03 3.73 At September 30, 2016 and 2015, the total intrinsic value of options outstanding was $0 and $0, respectively. At September 30, 2016 and 2015, the total intrinsic value of options exercisable was $0 and $0, respectively. Stock-based compensation for stock options has been recorded in the condensed consolidated statements of operations and totaled $35,422 and $105,143 for the three and nine months ended September 30, 2016, respectively, and $16,519 and $39,720 for the three and nine months ended September 30, 2015, respectively. As of September 30, 2016, the remaining balance of unamortized expense is $99,142 and is expected to be amortized over a remaining period of 1.00 year. Stock Warrants The following is a summary of the Company’s stock warrant activity during the nine months ended September 30, 2016: Number of Warrants Weighted Average Exercise Price Weighted Average Remaining Contractual Life Outstanding - January 1, 2016 508,068 $ 1.00 3.13 Granted 171,520 1.10 Exercised - - Forfeited/Cancelled - - Outstanding - September 30, 2016 679,588 $ 1.03 2.91 Exercisable - September 30, 2016 679,588 $ 1.03 2.91 At September 30, 2016 and 2015, the total intrinsic value of warrants outstanding and exercisable was $0 and $0, respectively. |
Related Party Transactions
Related Party Transactions | 9 Months Ended |
Sep. 30, 2016 | |
Related Party Transactions [Abstract] | |
RELATED PARTY TRANSACTIONS | NOTE 9 - RELATED PARTY TRANSACTIONS Jeromy Olson, the Chief Executive Officer of the Company, owns 50.0% of a sales management and consulting firm, NexPhase Global that provides sales services to the Company. These services include the retention of two full-time senior sales representatives including the current National Sales Director of the Company. Consulting expenses pertaining to the firm’s services were $78,300 and $200,300 for the three and nine months ended September 30, 2016, respectively. Included in consulting expense for the three and nine months ended September 30, 2016 were 10,000 and 30,000 shares of common stock valued at $3,300 and $25,300, respectively, issued to Nexphase Global. Consulting expenses pertaining to the firm’s services were $60,000 and $110,000 for the three and nine months ended September 30, 2015. Included in consulting expense for the three and nine months ended September 30, 2015 were 10,000 and 30,000 shares of common stock valued at $10,000 and $30,000, respectively, issued to Nexphase Global. Glenn Tilley, a director of the Company, was issued 15,000 shares of our common stock as part of a Waiver entered into with Mr. Tilley on March 31, 2016. (See Note 6 - Convertible Notes - May 7, 2015 Notes). |
Commitments and Contingencies
Commitments and Contingencies | 9 Months Ended |
Sep. 30, 2016 | |
Commitments and Contingencies [Abstract] | |
COMMITMENTS AND CONTINGENCIES | NOTE 10 – COMMITMENTS AND CONTINGENCIES Services Agreements On August 12, 2015, the Company entered into a Services Agreement with Aranea Partners. Aranea Partners agreed to provide investor relations services to the Company for a period of 12 months. As compensation for the services, the Company issued 50,000 shares of the Company common stock on August 12, 2015. On August 12, 2016, the Company is obligated to issue an additional 100,000 shares of the Company’s common stock. Unvested shares will be revalued at the end of each reporting period until they vest and will be expensed on a straight-line basis over the term of the agreement. The Company has recorded compensation expense relating to the agreement of $(51,202) and $28,361 during the three and nine months ended September 30, 2016, respectively. On August 4, 2015, the Company entered into a Services Agreement with a consultant. The consultant agreed to provide investor relations services to the Company for a period of 12 months. As compensation for the services, the Company was obligated to issue 62,500 shares of the Company common stock on August 16, 2015. On November 15, 2016, the Company is obligated to issue an additional 62,500 shares of the Company’s common stock. Unvested shares will be revalued at the end of each reporting period until they vest and will be expensed on a straight-line basis over the term of the agreement. The Company has recorded compensation expense relating to the agreement of $(12,449) and $52,818 during the three and nine months ended September 30, 2016, respectively. On February 19, 2016 (the “Effective Date”), the Company entered into a Services Agreement with a consultant. The consultant agreed to provide investor relations services to the Company for a period of 12 months. As compensation for the services, the Company shall pay the consultant $12,000 per month and is obligated to issue 62,500 shares of the Company common stock upon the 90-day anniversary of the Effective Date and on the 180-day, 270-day and 360-day anniversary of the Effective Date, if the agreement is renewed as outline in the terms of the service. The Company may terminate this agreement by providing 5 days advance written notice in the first 60 days of entering into this agreement and with 30 days advance written notice thereafter for the duration of the agreement. Unvested shares will be revalued at the end of each reporting period until they vest and will be expensed on a straight-line basis over the term of the agreement. The Company has recorded compensation expense relating to the equity portion of the agreement of $13,646 and $85,534 during the three and nine months ended September 30, 2016, respectively. On April 14, 2016 (the “Effective Date”), the Company entered into a Services Agreement with a consultant. The consultant agreed to provide financial and operational services to the Company. The agreement terminates on March 31, 2017. As compensation for the services, the Company shall pay the consultant $2,400 per month and is obligated to issue $1,000 in shares of the Company common stock to be issued quarterly in arrears based on a share price equal to the 30-day moving average share price. The Company may terminate this agreement by providing 21 days advance written notice for the duration of the agreement. The Company has recorded compensation expense relating to the equity portion of the agreement of $4,482 and $6,982 during the three and nine months ended September 30, 2016, respectively. On August 9, 2016, the Company entered into a Services Agreement with RedChip Companies Inc. (“RedChip”). RedChip agreed to provide investor relations services to the Company for a period of 12 months. As compensation for the services, the Company shall pay the consultant $5,000 per month and is obligated to issue $50,000 in shares of the Company common stock to be issued upon execution of the agreement based on a share price equal to the average closing price of the preceding 10 trading days. On February 9, 2017, the Company is obligated to issue an additional $50,000 in shares of the Company common stock based on a share price equal to the average closing price of the preceding 10 trading days. The Company may terminate the agreement during the month of February 2017 by providing written notice. The first tranche of shares vest on February 8, 2017 and the second tranche of shares vest on August 8, 2017. The Company agrees to increase the monthly consulting fee to $10,000 per month for the remaining months under the current term upon the closing of a capital raise in excess of $3,000,000. Unvested shares will be revalued at the end of each reporting period until they vest and will be expensed on a straight-line basis over the term of the agreement. The Company has recorded compensation expense relating to the equity portion of the agreement of $11,508 during the three and nine months ended September 30, 2016, respectively. Consulting Agreements In March 2014, the Company reached an agreement with a consulting firm owned by the CEO of the Company to provide non-exclusive sales services. The consulting firm will receive between 3.5% and 5% commissions on sales referred to the Company. In addition, the consulting firm will receive a monthly fee of $6,000, 50,000 shares of common stock upon execution of the agreement, and 10,000 shares of common stock at the beginning of each three month period for the term of the agreement and any renewal periods thereafter. The agreement is for 18 months, and is renewable for successive 18 month terms. On December 10, 2014, the consulting agreement was amended. The monthly fee was increased to $10,000 per month retroactive to September 1, 2014 and 50,000 additional shares of common stock were issued. In addition, the consulting firm will be issued qualified stock options as follows: ● 100,000 stock options at an exercise price of $1.50 per share that vest on December 31, 2015 ● 100,000 stock options at an exercise price of $1.75 per share that vest on December 31, 2016 ● 100,000 stock options at an exercise price of $2.50 per share that vest on December 31, 2017 The options are to be issued after the Company adopts a formal option plan that is approved by the Board of Directors. (See Note 11) On March 14, 2016, the consulting agreement was further amended. The monthly fee was increased to $20,000 per month for a period of twelve months. At the end of the twelve month period the monthly payment reverts back to $10,000. In March 2014, the Company reached an agreement with a consulting firm to provide non-exclusive sales services. The consulting firm will receive up to 5% commissions on sales referred to the Company. The term of the agreement is for one year, and automatically renews for successive one year terms unless either party notifies the other, in writing, of its intention not to renew at least 60 days before the end of the initial term of this agreement or any renewal term. As compensation for the services, the Company shall pay the consultant $2,500 per month and is obligated to issue 50,000 shares of the Company common stock upon execution of the agreement and 10,000 shares of the Company common stock at the beginning of each three month period for the term of the agreement and any renewal periods thereafter. The Company may terminate this agreement by providing 5 days advance written notice in the first 60 days of entering into this agreement and with 30 days advance written notice thereafter for the duration of the agreement. The Company has recorded compensation expense relating to the equity portion of the agreement of $11,000 and $33,000 during the three and nine months ended September 30, 2016, respectively. In February 2015, the Company reached an agreement with a consulting firm to provide non-exclusive sales services with an effective date of February 10, 2015 (the “Effective Date”). The agreement expires on December 31, 2017 and automatically renews for successive one year terms unless either party notifies the other, in writing, of its intention not to renew at least 15 days before the end of the initial term of this agreement or any renewal term. As compensation for the services, the consultant will receive (i) 5% commissions on sales of products or services other than turf referred to the Company; (ii) commission based on square footage of turf sold to certain parties as outlined in the agreement; (iii) 100,000 shares of the Company common stock (the “Payment Shares”) upon execution of the agreement, which shall be subject to certain Clawback provisions. “Clawback” means (i) if this agreement is terminated by the Company prior to December 31, 2016, then 50,000 of the Payment Shares shall be forfeited, and cancelled by the Company; and (i) if this Agreement is terminated by the Company prior to December 31, 2017, then 25,000 of the Payment Shares shall be forfeited, and cancelled by the Company. No equity compensation will be owed in connection with any renewal term. Unvested shares will be revalued at the end of each reporting period until they vest and will be expensed on a straight-line basis over the term of the agreement. The Company has recorded compensation expense relating to the equity portion of the agreement of $(12,666) and $5,447 during the three and nine months ended September 30, 2016, respectively. In February 2015, the Company reached an agreement with an individual to provide non-exclusive sales services with an effective date of January 1, 2015 (the “Effective Date”). The individual will receive up to 5% commissions on sales referred to the Company. The term of the agreement is for 18 months from the date of execution, and automatically renews for successive one year terms unless either party notifies the other, in writing, of its intention not to renew at least 90 days before the end of the initial term of this agreement or any renewal term. As compensation for the services, the Company shall pay the consultant $5,000 per month and is obligated to issue 25,000 shares of the Company common stock within 30 days of execution of the agreement, 25,000 shares of the Company common stock within 15 days of the date of execution and delivery of a certain synthetic turf contract and 20,000 shares of the Company common stock upon reaching certain sales milestones. The Company has recorded compensation expense relating to the equity portion of the agreement of $0 and $8,333 during the three and nine months ended September 30, 2016, respectively. In November 2015, the Company reached an agreement with an individual to provide non-exclusive sales services with an effective date of January 1, 2015 (the “Effective Date”). The term of the agreement is for 3 years from the date of execution, and automatically renews for successive one year terms unless either party notifies the other, in writing, of its intention not to renew at least 90 days before the end of the initial term of this agreement or any renewal term. As compensation for the services, the Company is obligated to issue 75,000 shares of the Company common stock (the “Payment Shares”) within 30 days of execution of the agreement, which shall be subject to certain Clawback provisions. “Clawback” means (i) if this agreement is terminated by the Company prior to September 30, 2016, then 50,000 of the Payment Shares shall be forfeited, and cancelled by the Company; and (i) if this Agreement is terminated by the Company prior to June 30, 2017, then 25,000 of the Payment Shares shall be forfeited, and cancelled by the Company. No equity compensation will be owed in connection with any renewal term. Unvested shares will be revalued at the end of each reporting period until they vest and will be expensed on a straight-line basis over the term of the agreement. The Company has recorded compensation expense relating to the equity portion of the agreement of $(4,000) and $9,700 during the three and nine months ended September 30, 2016, respectively. In December 2015, the Company reached an agreement with an individual to provide non-exclusive sales services. The individual will receive up to 5% commissions on sales referred to the Company. The term of the agreement is for 18 months from the date of execution, and automatically renews for successive one year terms unless either party notifies the other, in writing, of its intention not to renew at least 90 days before the end of the initial term of this agreement or any renewal term. As compensation for the services, the Company is obligated to issue 25,000 shares of the Company common stock within 30 days of execution of the agreement, 125,000 shares of the Company common stock which shall vest at the rate of 25,000 shares per quarter, effective beginning as of the quarter ending March 31, 2016 and 20,000 shares of the Company common stock upon reaching certain sales milestones. No equity compensation will be owed in connection with any renewal term. Unvested shares will be revalued at the end of each reporting period until they vest and will be expensed on a straight-line basis over the term of the agreement. The Company has recorded compensation expense relating to the equity portion of the agreement of $(1,385) and $53,414 during the three and nine months ended September 30, 2016, respectively. In March 2016, the Company reached an agreement with an individual to provide non-exclusive sales services with an effective date of March 15, 2016 (the “Effective Date”). The individual will receive up to 1% commissions on sales referred to the Company. The term of the agreement is for one year, and automatically renews for successive one year terms unless either party notifies the other, in writing, of its intention not to renew at least 60 days before the end of the initial term of this agreement or any renewal term. As compensation for the services, the Company is obligated to issue 4,000 shares of the Company common stock on the 15 th In April 2016, the Company reached an agreement with an individual to provide non-exclusive sales services with an effective date of April 20, 2016 (the “Effective Date”). The individual will receive up to 4% commissions on sales referred to the Company. The term of the agreement is for one year, and automatically renews for successive one year terms. The Company may terminate this agreement by providing 60 days advance written notice for the duration of the agreement. As compensation for the services, the Company is obligated to issue 4,000 shares of the Company common stock on the 15 th Employment Agreements In September 2014, Jeromy Olson entered into a 40 month employment agreement to serve in the capacity of CEO, with subsequent one year renewal periods. The CEO will receive a monthly salary of $10,000 that (1) will increase to $13,000 upon the Company achieving gross revenues of at least $10,000,000, as amended, and an operating margin of at least 15%, and (2) will increase to $16,000 per month upon the Company achieving gross revenues of at least $15,000,000 and an operating margin of at least 15%. The agreement provides for cash bonuses of 15% of the annual Adjusted EBITDA between $1 and $1,000,000, 10% of the annual Adjusted EBITDA between $1,000,001 and $2,000,000 and 5% of the annual Adjusted EBITDA greater than $2,000,000. For purposes of the agreement, Adjusted EBITDA is defined as earnings before interest, taxes, depreciation and amortization less share based payments, gains or losses on derivative instruments and other non-cash items approved by the Board of Directors. The CEO was issued 250,000 shares of common stock on the date of the agreement and will receive 250,000 shares of common stock on January 1, 2016 provided the agreement is still in effect. Lastly, the CEO will be issued qualified stock options as follows: ● 100,000 stock options at an exercise price of $1.50 per share that vest on December 31, 2015 ● 100,000 stock options at an exercise price of $1.75 per share that vest on December 31, 2016 ● 100,000 stock options at an exercise price of $2.50 per share that vest on December 31, 2017 The options are to be issued after the Company adopts a formal option plan that is approved by the Board of Directors. (See Note 11) Director Agreements On January 4, 2016, the Company entered into a director agreement with Glenn Tilley, concurrent with Mr. Tilley’s appointment to the Board of Directors of the Company (the “Board”) effective January 4, 2016. The director agreement may, at the option of the Board, be automatically renewed on such date that Mr. Tilley is re-elected to the Board. Pursuant to the director agreement, Mr. Tilley is to be paid a stipend of One Thousand Dollars ($1,000) per meeting of the Board, which shall be contingent upon his attendance at the meetings being in person, rather than via telephone or some other electronic medium. Additionally, Mr. Tilley shall receive non-qualified stock options (the “Options”) to purchase Two Hundred Thousand (200,000) shares of the Company’s common stock. The exercise price of the Options shall be One Dollar ($1.00) per share. The Options shall vest in equal amounts over a period of two (2) years at the rate of Twenty Five Thousand (25,000) shares per fiscal quarter on the last day of each such quarter, commencing January 4, 2016. The total grant date value of the options was $97,535 which shall be expensed over the vesting period. Advisory Board Agreements On February 11, 2016, the Company entered into an advisory board agreement with John Brenkus, effective June 1, 2016 (the (“Effective Date”). The term of the agreement is for a period of 24 months commencing on the Effective Date. Pursuant to the agreement, Mr. Brenkus is to be issued 25,000 shares of the Company common stock at the beginning of each quarter starting on the Effective Date through the term of the agreement. The Company has recorded compensation expense relating to the agreement of $6,137 and $14,876 during the three and nine months ended September 30, 2016, respectively. Supply Agreement On December 2, 2015, IMG Academy LLC (“IMG”) and the Company entered into an Official Supplier Agreement (the “Agreement”). The term of the Agreement is January 1, 2016 through December 31, 2019 (the “Term”). Under the Agreement, The Company is to be the “Official Supplier” of IMG in connection with certain of the Company’s products and related services during the Term. Additionally, the Agreement provides the Company with certain promotional opportunities and supplier benefits including but not limited to (i) on-site signage and Company brand exposure (ii) the opportunity to install up to 4 test turf plots (the “Test Plots”) in order for the Company to conduct research on its turf products and the ability to use IMG athletes as participants in such testing (ii) opportunity to schedule site visits of test plots for potential Company customers and (iv) access to IMG’s personnel to include Head Coaches, Athletic Director and Administrators, subject to clearances and applicable rules of governing bodies such as NCAA. As consideration for its designation as IMG’s “Official Supplier” the Company must pay IMG three installments of $208,000 during the Term as specified in the Agreement. As of September 30, 2016 the company has recorded $117,376 of expense related to the agreement which is included in accounts payable and accrued expenses. Litigation The Company is engaged in an administrative proceeding against a former employee who was terminated from his positions with the Company for cause on May 12, 2014. The former employee has claimed he is due between $24,000 and $48,000 in unpaid wages. The Company is in the process of settling the matter while continuing to vigorously defend itself. The Company has been put on notice by Brock USA, LLC d/b/a Brock International LLC (“Brock”) of patent infringement relating to certain products acquired by the Company from NexxField, Inc. (“NexxField”), namely, NexxField’s NexxPad turf underlayment panels. In July 2016, Brock commenced a patent infringement lawsuit against NexxField alleging that NexxField’s NexxPad panels infringe certain patents owned by Brock. The Company has not been named as a defendant in Brock’s patent infringement action. The Company believes it will be able to resolve this matter without being named as a defendant in the lawsuit and will be able to find alternative products if necessary. Operating Leases On September 23, 2015, the Company entered into a new lease agreement for its office space in Illinois. The lease commences on January 1, 2016 and expires on December 31, 2016. The lease has minimum monthly payments of $1,045. The rents for the first and seventh months of 2016 are free. The lease automatically renews for periods of 12 months unless a three month notice is provided by either the Company or the landlord. The Company was required to pay a security deposit to the lessor totaling $2,090. Deferred rent at September 30, 2016 and December 31, 2015 was immaterial. For the three months ended September 30, 2016 and 2015, the Company incurred rent expense of $4,021 and $2,600, respectively. For the nine months ended September 30, 2016 and 2015, the Company incurred rent expense of $10,492 and $14,617, respectively. |
Subsequent Events
Subsequent Events | 9 Months Ended |
Sep. 30, 2016 | |
Subsequent Events [Abstract] | |
SUBSEQUENT EVENTS | NOTE 11 – SUBSEQUENT EVENTS Glenn Tilley, a director of the Company, was issued 30,000 shares of our common stock in consideration for extending the maturity date of the note issued in his favor. Subsequent to September 30, 2016, 7,317 shares of common stock were issued to a consultant for professional services provided to the Company. On October 4, 2016, the Board approved the Sports Field 2016 Incentive Stock Option (the “2016 Plan”). The Plan provides for the issuance of up to 2,500,000 shares of common stock of the Company through the grant of non-qualified options (the “Non-qualified Options”), incentive options (the “Incentive Options” and together with the Non-qualified Options, the “Options”) and restricted stock (the “Restricted Stock”) and unrestricted stock (the “Unrestricted Stock”) to directors, officers, consultants, attorneys, advisors and employees. The 2,500,000 shares available under the 2016 Plan represent approximately 15% of the Company’s issued and outstanding common stock as of October 4, 2016. The Board believes the 2,500,000 shares that may be awarded under the 2016 Plan should be sufficient to cover grants through at least the end of the fiscal year 2018. On November 3, 2016, the Board, pursuant to the employment agreement with our CEO (See Note 10), approved the issuance of (i) qualified options to purchase 100,000 shares of the Company’s Common Stock at a price of $1.50 vesting immediately with a grant date of November 3, 2016 and (ii) qualified options to purchase 75,000 shares of the Company’s Common Stock at a price of $1.75 vesting on December 31, 2016. Mr. Olson is due additional option grants pursuant to his employment agreement, however, those grants are being deferred until 2017 to comply with the terms of the issuance of incentive options in the 2016 Plan. On November 3, 2016, the Board, pursuant to a consulting agreement with a consulting firm owned by the CEO of the Company (See Note 10), approved the issuance of (i) non-qualified options to purchase 100,000 shares of the Company’s Common Stock at a price of $1.50 vesting immediately with a grant date of November 3, 2016 and (ii) non-qualified options to purchase 75,000 shares of the Company’s common stock at a price of $1.75 vesting on December 31, 2016. The consultant is due additional option grants pursuant to the consulting agreement, however, those grants are being deferred until 2017 to comply with the terms of the issuance of incentive options in the 2016 Plan. |
Significant Accounting Polici17
Significant Accounting Policies (Policies) | 9 Months Ended |
Sep. 30, 2016 | |
Significant Accounting Policies [Abstract] | |
Principles of Consolidation | Principles of Consolidation The accompanying condensed consolidated financial statements include the accounts of Sports Field Holdings, Inc. and its wholly owned subsidiaries. All significant intercompany accounts and transactions have been eliminated in consolidation. |
Use of Estimates | Use of Estimates The preparation of condensed consolidated financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent liabilities at the date of the condensed consolidated financial statements and the reported amounts of revenue and expenses during the periods. Actual results could differ from those estimates. The Company’s significant estimates and assumptions include the accounts receivable allowance for doubtful accounts, percentage of completion revenue recognition method, the useful life of fixed assets and assumptions used in the fair value of stock-based compensation. |
Revenues and Cost Recognition | Revenues and Cost Recognition Revenues from construction contracts are included in contract revenue in the condensed consolidated statements of operations and are recognized under the percentage-of-completion accounting method. The percent complete is measured by the cost incurred to date compared to the estimated total cost of each project. This method is used as management considers expended cost to be the best available measure of progress on these contracts, the majority of which are completed within one year, but may occasionally extend beyond one year. Inherent uncertainties in estimating costs make it at least reasonably possible that the estimates used will change within the near term and over the life of the contracts. Contract costs include all direct material and labor costs and those indirect costs related to contract performance and completion. Provisions for estimated losses on uncompleted contracts are made in the period in which such losses are determined. General and administrative costs are charged to expense as incurred. Changes in job performance, job conditions and estimated profitability, including those arising from contract penalty provisions and final contract settlements, may result in revisions to costs and income. Such revisions are recognized in the period in which they are determined. Costs and estimated earnings in excess of billings are comprised principally of revenue recognized on contracts (on the percentage-of-completion method) for which billings had not been presented to customers because the amounts were not billable under the contract terms at the balance sheet date. In accordance with the contract terms, any unbilled receivables at period end will be billed subsequently. Amounts are billed based on contractual terms. Billings in excess of costs and estimated earnings represent billings in excess of revenues recognized. |
Cash and Cash Equivalents | Cash and Cash Equivalents The Company considers all short-term highly liquid investments with a remaining maturity at the date of purchase of three months or less to be cash equivalents. As of September 30, 2016 and December 31, 2015 the company did not have any cash equivalents. |
Property, Plant and Equipment | Property, Plant and Equipment Property, plant and equipment are carried at cost less accumulated depreciation and amortization. Depreciation and amortization are calculated using the straight-line method over the estimated useful lives of the assets, which generally range from 3 to 5 years. Gains and losses from the retirement or disposition of property and equipment are included in operations in the period incurred. Maintenance and repairs are expensed as incurred. |
Stock-Based Compensation | Stock-Based Compensation The Company measures the cost of services received in exchange for an award of equity instruments based on the fair value of the award. For employees, the fair value of the award is measured on the grant date and for non-employees, the fair value of the award is generally re-measured on vesting dates and interim financial reporting dates until the service period is complete. The fair value amount is then recognized over the period during which services are required to be provided in exchange for the award, usually the vesting period. Awards granted to directors are treated on the same basis as awards granted to employees. |
Concentrations of Credit Risk | Concentrations of Credit Risk Financial instruments and related items, which potentially subject the Company to concentrations of credit risk, consist primarily of cash and cash equivalents. The Company places its cash and temporary cash investments with credit quality institutions. At times, such amounts may be in excess of the FDIC insurance limit. |
Accounts Receivable and Allowance for Doubtful Accounts | Accounts Receivable and Allowance for Doubtful Accounts Accounts receivable are stated at the amount management expects to collect from outstanding balances. The Company generally does not require collateral to support customer receivables. The Company provides an allowance for doubtful accounts based upon a review of the outstanding accounts receivable, historical collection information and existing economic conditions. The Company determines if receivables are past due based on days outstanding, and amounts are written off when determined to be uncollectible by management. The maximum accounting loss from the credit risk associated with accounts receivable is the amount of the receivable recorded, which is the face amount of the receivable, net of the allowance for doubtful accounts. As of September 30, 2016 and December 31, 2015, the Company’s accounts receivable balance was $14,704 and $151,168, respectively, and the allowance for doubtful accounts is $0 in each period. |
Research and Development | Research and Development Research and development expenses are charged to operations as incurred. For the three months ended September 30, 2016 and 2015, the Company incurred research and development expenses of $0 and $0, respectively. For the nine months ended September 30, 2016 and 2015, the Company incurred research and development expenses of $88,447 and $0, respectively. |
Warranty Costs | Warranty Costs The Company generally provides a warranty on the products installed for up to 8 years with certain limitations and exclusions based upon the manufacturer’s product warranty; therefore the Company does not believe a warranty reserve is required as of September 30, 2016 and December 31, 2015. |
Fair Value of Financial Instruments | Fair Value of Financial Instruments Accounting Standards Codification subtopic 825-10, Financial Instruments (“ASC 825-10”) requires disclosure of the fair value of certain financial instruments. The carrying value of cash and cash equivalents, accounts payable and accrued liabilities, and short-term borrowings, as reflected in the balance sheets, approximate fair value because of the short-term maturity of these instruments. All other significant financial assets, financial liabilities and equity instruments of the Company are either recognized or disclosed in the financial statements together with other information relevant for making a reasonable assessment of future cash flows, interest rate risk and credit risk. Where practicable the fair values of financial assets and financial liabilities have been determined and disclosed; otherwise only available information pertinent to fair value has been disclosed. |
Beneficial Conversion Feature | Beneficial Conversion Feature For conventional convertible debt where the rate of conversion is below market value, the Company records a “beneficial conversion feature” (“BCF”) and related debt discount. When the Company records a BCF the relative fair value of the BCF would be recorded as a debt discount against the face amount of the respective debt instrument. The debt discount attributable to the BCF is amortized over the period from issuance to the date that the debt matures. |
Derivative Instruments | Derivative Instruments The Company evaluates its convertible debt, warrants or other contracts to determine if those contracts or embedded components of those contracts qualify as derivatives to be separately accounted for in accordance with ASC 815-15. The result of this accounting treatment is that the fair value of the embedded derivative is marked-to-market each balance sheet date and recorded as a liability. In the event that the fair value is recorded as a liability, the change in fair value is recorded in the statements of operations as other income or expense. Upon conversion or exercise of a derivative instrument, the instrument is marked to fair value at the conversion date and then that fair value is reclassified to equity. In circumstances where the embedded conversion option in a convertible instrument is required to be bifurcated and there are also other embedded derivative instruments in the convertible instrument that are required to be bifurcated, the bifurcated derivative instruments are accounted for as a single, compound derivative instrument. The classification of derivative instruments, including whether such instruments should be recorded as liabilities or as equity, is re-assessed at the end of each reporting period. Equity instruments that are initially classified as equity that become subject to reclassification are reclassified to liability at the fair value of the instrument on the reclassification date. |
Net Income (Loss) Per Common Share | Net Income (Loss) Per Common Share The Company computes basic net income (loss) per share by dividing net income (loss) per share available to common stockholders by the weighted average number of common shares outstanding for the period and excludes the effects of any potentially dilutive securities. Diluted earnings per share, if presented, would include the dilution that would occur upon the exercise or conversion of all potentially dilutive securities into common stock using the “treasury stock” and/or “if converted” methods as applicable. The computation of basic and diluted loss per share excludes potentially dilutive securities because their inclusion would be anti-dilutive. Anti-dilutive securities excluded from the computation of basic and diluted net loss per share for the nine months ended September 30, 2016 and 2015, respectively, are as follows: September 30, 2016 2015 Warrants to purchase common stock 679,588 500,000 Options to purchase common stock 622,500 430,000 Unvested restricted common shares 217,593 - Convertible Notes 2,102,615 616,310 Totals 3,622,296 1,546,310 |
Shares outstanding | Shares outstanding Shares outstanding include shares of unvested restricted stock. Unvested restricted stock included in reportable shares outstanding was 217,593 and 0 shares as of September 30, 2016 and 2015, respectively. Shares of unvested restricted stock are excluded from our calculation of basic weighted average shares outstanding, but their dilutive impact is added back in the calculation of diluted weighted average shares outstanding. |
Significant Customers | Significant Customers The Company’s business focuses on securing a smaller number of high quality, highly profitable projects, which sometimes results in having a concentration of sales and accounts receivable among a few customers. This concentration is customary among the design and build industry for a company of our size. As we continue to grow and are awarded more projects, this concentration will continue to decrease. At September 30, 2016, the Company had one customer representing 100.0% of the total accounts receivable balance. At December 31, 2015, the Company had two customers representing 94% of the total accounts receivable balance. For the three months ended September 30, 2016, the Company had four customers that represented 10%, 17%, 28%, and 43% of the total revenue and for the three months ended September 30, 2015, the Company had three customers that represented 14%, 62% and 23% of the total revenue. For the nine months ended September 30, 2016, the Company had five customers that represented 15%, 33%, 17%, 11% and 15% of the total revenue and for the nine months ended September 30, 2015, the Company had four customers that represented 18%, 28%, 39%, and 13% of the total revenue. |
Reclassifications | Reclassifications Certain items in the prior year financial statements have been reclassified to conform to the current year presentation. |
Recently Adopted Accounting Guidance | Recently Adopted Accounting Guidance In April 2015, the FASB issued Accounting Standards Update No. 2015-03, Interest - Imputation of Interest (Subtopic 835-30): Simplifying the Presentation of Debt Issuance Costs In June 2014, the Financial Accounting Standards Board issued Accounting Standards Update 2014-12, Compensation-Stock Compensation |
Recent Accounting Guidance Not Yet Adopted | Recent Accounting Guidance Not Yet Adopted During May 2014, the FASB issued ASU No. 2014-09, “Revenue from Contracts with Customers” (“ASU 2014-09”), which requires entities to recognize revenue in a way that depicts the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled to in exchange for those goods or services. The new guidance also requires additional disclosure about the nature, amount, timing and uncertainty of revenue and cash flows arising from customer contracts, including significant judgments and changes in judgments and assets recognized from costs incurred to obtain or fulfill a contract. In July 2015, the FASB voted to delay the effective date of ASU 2014-09 by one year to the first quarter of 2018 to provide companies sufficient time to implement the standards. Early Adoption will be permitted, but not before the first quarter of 2017. Adoption can occur using one of two prescribed transition methods. The Company is currently evaluating the impact of the new standard. In August 2014, the Financial Accounting Standards Board issued Accounting Standards Update 2014-15, Presentation of Financial Statements-Going Concern. In February 2016, the Financial Accounting Standards Board ("FASB") issued Accounting Standards Update ("ASU") No. 2016-02, “Leases” (topic 842). The FASB issued this update to increase transparency and comparability among organizations by recognizing lease assets and lease liabilities on the balance sheet and disclosing key information about leasing arrangements. The updated guidance is effective for annual periods beginning after December 15, 2018, including interim periods within those fiscal years. Early adoption of the update is permitted. The Company is currently evaluating the impact of the new standard. In March 2016, the Financial Accounting Standards Board ("FASB") issued Accounting Standards Update ("ASU") No. 2016-06, “Derivatives and Hedging” (topic 815). The FASB issued this update to clarify the requirements for assessing whether contingent call (put) options that can accelerate the payment of principal on debt instruments are clearly and closely related to their debt hosts. An entity performing the assessment under the amendments in this update is required to assess the embedded call (put) options solely in accordance with the four-step decision sequence. The updated guidance is effective for annual periods beginning after December 15, 2016, including interim periods within those fiscal years. Early adoption of the update is permitted. The Company is currently evaluating the impact of the new standard. In April 2016, the Financial Accounting Standards Board ("FASB") issued Accounting Standards Update ("ASU") No. 2016-09, “Compensation – Stock Compensation” (topic 718). The FASB issued this update to improve the accounting for employee share-based payments and affect all organizations that issue share-based payment awards to their employees. Several aspects of the accounting for share-based payment award transactions are simplified, including: (a) income tax consequences; (b) classification of awards as either equity or liabilities; and (c) classification on the statement of cash flows. The updated guidance is effective for annual periods beginning after December 15, 2016, including interim periods within those fiscal years. Early adoption of the update is permitted. The Company is currently evaluating the impact of the new standard. In April 2016, the Financial Accounting Standards Board (‘FASB”) issued Accounting Standards Update (“ASU”) No. 2016-10, “Revenue from Contracts with Customers: Identifying Performance Obligations and Licensing” (topic 606). In March 2016, the Financial Accounting Standards Board (‘FASB”) issued Accounting Standards Update (“ASU”) No. 2016-08, “Revenue from Contracts with Customers: Principal versus Agent Considerations (Reporting Revenue Gross verses Net)” (topic 606). These amendments provide additional clarification and implementation guidance on the previously issued ASU 2014-09, “Revenue from Contracts with Customers”. The amendments in ASU 2016-10 provide clarifying guidance on materiality of performance obligations; evaluating distinct performance obligations; treatment of shipping and handling costs; and determining whether an entity's promise to grant a license provides a customer with either a right to use an entity's intellectual property or a right to access an entity's intellectual property. The amendments in ASU 2016-08 clarify how an entity should identify the specified good or service for the principal versus agent evaluation and how it should apply the control principle to certain types of arrangements. The adoption of ASU 2016-10 and ASU 2016-08 is to coincide with an entity's adoption of ASU 2014-09, which we intend to adopt for interim and annual reporting periods beginning after December 15, 2017. The Company is currently evaluating the impact of the new standard. In August 2016, the Financial Accounting Standards Board (‘FASB”) issued Accounting Standards Update (“ASU”) No. 2016-15, "Statement of Cash Flows - Classification of Certain Cash Receipts and Cash Payments." ASU No. 2016-15 addresses specific cash flow classification issues where there is currently diversity in practice including debt prepayment and proceeds from the settlement of insurance claims. ASU 2016-15 is effective for annual periods beginning after December 15, 2017, with early adoption permitted. The Company is currently evaluating the impact of the new standard. There were no other new accounting pronouncements that were issued or became effective since the issuance of our 2015 Annual Report on Form 10-K that had, or are expected to have, a material impact on our condensed consolidated financial position, results of operations or cash flows. |
Subsequent Events | Subsequent Events Management has evaluated subsequent events or transactions occurring through the date on which the financial statements were issued. Based upon the evaluation, the Company did not identify any recognized or non-recognized subsequent events that would have required adjustment or disclosure in the condensed consolidated financial statements, except as disclosed. |
Significant Accounting Polici18
Significant Accounting Policies (Tables) | 9 Months Ended |
Sep. 30, 2016 | |
Significant Accounting Policies [Abstract] | |
Schedule of anti-dilutive securities excluded from computation of basic and diluted net loss per share | September 30, 2016 2015 Warrants to purchase common stock 679,588 500,000 Options to purchase common stock 622,500 430,000 Unvested restricted common shares 217,593 - Convertible Notes 2,102,615 616,310 Totals 3,622,296 1,546,310 |
Costs and Estimated Earnings 19
Costs and Estimated Earnings on Contracts In Process (Tables) | 9 Months Ended |
Sep. 30, 2016 | |
Costs and Estimated Earnings on Contracts in Process [Abstract] | |
Schedule of costs incurred on contracts in progress | September 30, December 31, 2016 2015 Costs incurred on contracts in progress $ 5,243,778 $ 5,395,046 Estimated earnings (losses) (524,331 ) (863,259 ) 4,719,447 4,531,787 Less billings to date (4,584,731 ) (4,524,817 ) $ 134,716 $ 6,970 |
Schedule of costs and estimated earnings amounts contracts in process included balance sheets | September 30, December 31, 2016 2015 Costs and estimated earnings in excess of billings $ 247,197 $ 137,016 Billings in excess of costs and estimated earnings (58,375 ) - Provision for estimated losses on uncompleted contracts (54,106 ) (130,046 ) $ 134,716 $ 6,970 |
Property, Plant and Equipment (
Property, Plant and Equipment (Tables) | 9 Months Ended |
Sep. 30, 2016 | |
Property, Plant and Equipment [Abstract] | |
Schedule of property, plant and equipment | September 30, December 31, Furniture and equipment $ 20,278 $ 20,278 Total 20,278 20,278 Less: accumulated depreciation (9,071 ) (6,029 ) $ 11,207 $ 14,249 |
Debt (Tables)
Debt (Tables) | 9 Months Ended |
Sep. 30, 2016 | |
Debt [Abstract] | |
Schedule of debt under promissory notes | September 30, 2015 December 31, 2015 Promissory notes payable $ 877,500 $ 313,993 Less: Current maturities (127,500 ) - Less: Debt issuance costs (37,889 ) - Promissory notes payable, net of Current maturities and debt issuance costs $ 712,111 $ 313,993 |
Schedule of future minimum principal payments under promissory notes | Year ending December 31: 2016 – (Remainder of year) $ 45,000 2017 832,500 2018 and thereafter - $ 877,500 |
Stockholders Equity (Deficit) (
Stockholders Equity (Deficit) (Tables) | 9 Months Ended |
Sep. 30, 2016 | |
Stockholders Equity (Deficit) [Abstract] | |
Schedule of Black-Scholes option pricing model | For the Nine Months Ended September 30, 2016 Risk free interest rate 1.73 % Dividend yield 0.00 % Expected volatility 45.25 % Expected life in years 5 Forfeiture Rate 0.00 % |
Schedule of stock option activity | Number of Options Weighted Average Exercise Price Weighted Average Remaining Contractual Life Outstanding - January 31, 2016 430,000 $ 1.03 5.00 Granted 200,000 1.00 5.00 Exercised - - - Forfeited/Cancelled (7,500 ) 1.50 - Outstanding - September 30, 2016 622,500 $ 1.02 3.82 Exercisable - September 30, 2016 422,500 $ 1.03 3.73 |
Schedule of stock warrant activity | Number of Warrants Weighted Average Exercise Price Weighted Average Remaining Contractual Life Outstanding - January 1, 2016 508,068 $ 1.00 3.13 Granted 171,520 1.10 Exercised - - Forfeited/Cancelled - - Outstanding - September 30, 2016 679,588 $ 1.03 2.91 Exercisable - September 30, 2016 679,588 $ 1.03 2.91 |
Significant Accounting Polici23
Significant Accounting Policies (Details) - shares | 9 Months Ended | |
Sep. 30, 2016 | Sep. 30, 2015 | |
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Totals | 3,622,296 | 1,546,310 |
Warrants to purchase common stock [Member] | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Totals | 679,588 | 500,000 |
Options to purchase common stock [Member] | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Totals | 622,500 | 430,000 |
Unvested restricted common shares [Member] | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Totals | 217,593 | |
Convertible Notes [Member] | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Totals | 2,102,615 | 616,310 |
Significant Accounting Polici24
Significant Accounting Policies (Details Textual) | 3 Months Ended | 9 Months Ended | 12 Months Ended | ||
Sep. 30, 2016USD ($)Customersshares | Sep. 30, 2015USD ($)Customersshares | Sep. 30, 2016USD ($)Customersshares | Sep. 30, 2015USD ($)Customersshares | Dec. 31, 2015USD ($)Customers | |
Summary of Significant Accounting Policies (Textual) | |||||
Accounts receivable | $ | $ 14,704 | $ 14,704 | $ 151,168 | ||
Warranty costs, Description | The Company generally provides a warranty on the products installed for up to 8 years with certain limitations and exclusions based upon the manufacturer's product warranty | ||||
Research and development expenses | $ | $ 88,447 | ||||
Debt issuance costs | $ | $ 37,889 | $ 37,889 | |||
Maximum [Member] | |||||
Summary of Significant Accounting Policies (Textual) | |||||
Estimated useful lives of the assets | P5Y | ||||
Minimum [Member] | |||||
Summary of Significant Accounting Policies (Textual) | |||||
Estimated useful lives of the assets | P3Y | ||||
Unvested restricted stock [Member] | |||||
Summary of Significant Accounting Policies (Textual) | |||||
Shares outstanding | shares | 217,593 | 0 | 217,593 | 0 | |
Accounts Receivable [Member] | Customer One [Member] | |||||
Summary of Significant Accounting Policies (Textual) | |||||
Concentration of credit risk percentage | 100.00% | 94.00% | |||
Number of customers | 1 | 2 | |||
Revenue [Member] | Customer One [Member] | |||||
Summary of Significant Accounting Policies (Textual) | |||||
Concentration of credit risk percentage | 10.00% | 14.00% | 15.00% | 18.00% | |
Number of customers | 4 | 3 | 5 | 4 | |
Revenue [Member] | Customer Two [Member] | |||||
Summary of Significant Accounting Policies (Textual) | |||||
Concentration of credit risk percentage | 17.00% | 62.00% | 33.00% | 28.00% | |
Number of customers | 4 | 3 | 5 | 4 | |
Revenue [Member] | Customer Three [Member] | |||||
Summary of Significant Accounting Policies (Textual) | |||||
Concentration of credit risk percentage | 28.00% | 23.00% | 17.00% | 39.00% | |
Number of customers | 4 | 3 | 5 | 4 | |
Revenue [Member] | Customer Four [Member] | |||||
Summary of Significant Accounting Policies (Textual) | |||||
Concentration of credit risk percentage | 43.00% | 11.00% | 13.00% | ||
Number of customers | 4 | 5 | 4 | ||
Revenue [Member] | Customer Five [Member] | |||||
Summary of Significant Accounting Policies (Textual) | |||||
Concentration of credit risk percentage | 15.00% | ||||
Number of customers | 5 |
Going Concern (Details)
Going Concern (Details) - USD ($) | 3 Months Ended | 9 Months Ended | |||
Sep. 30, 2016 | Sep. 30, 2015 | Sep. 30, 2016 | Sep. 30, 2015 | Dec. 31, 2015 | |
Going Concern (Textual) | |||||
Working capital deficit | $ (1,952,354) | $ (1,952,354) | |||
Net loss | (737,318) | $ (798,801) | (2,882,280) | $ (2,096,973) | |
Net cash used in operations | (2,026,048) | $ (1,036,591) | |||
Accumulated deficit | $ (13,151,798) | $ (13,151,798) | $ (10,269,518) |
Costs and Estimated Earnings 26
Costs and Estimated Earnings on Contracts in Process (Details) - USD ($) | Sep. 30, 2016 | Dec. 31, 2015 |
Costs and Estimated Earnings on Contracts in Process [Abstract] | ||
Costs incurred on contracts in progress | $ 5,243,778 | $ 5,395,046 |
Estimated earnings (losses) | (524,331) | (863,259) |
Costs and estimated earnings (losses) incurred on contracts in progress | 4,719,447 | 4,531,787 |
Less billings to date | (4,584,731) | (4,524,817) |
Cost in excess of billing on contracts in process, net | $ 134,716 | $ 6,970 |
Costs and Estimated Earnings 27
Costs and Estimated Earnings on Contracts in Process (Details 1) - USD ($) | Sep. 30, 2016 | Dec. 31, 2015 |
Costs and Estimated Earnings on Contracts in Process [Abstract] | ||
Costs and estimated earnings in excess of billings | $ 247,197 | $ 137,016 |
Billings in excess of costs and estimated earnings | (58,375) | |
Provision for estimated losses on uncompleted contracts | (54,106) | (130,046) |
Cost in excess of billing on contracts in process, net | $ 134,716 | $ 6,970 |
Costs and Estimated Earnings 28
Costs and Estimated Earnings on Contracts in Process (Details Textual) - USD ($) | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2016 | Sep. 30, 2015 | Sep. 30, 2016 | Sep. 30, 2015 | |
Costs and Estimated Earnings on Contracts in Process [Abstract] | ||||
Warranty costs | $ 103,600 | $ 21,863 | $ 121,000 | $ 227,863 |
Technology services description | The Company generally provides a warranty on the products installed for up to 8 years with certain limitations and exclusions based upon the manufacturer's product warranty. |
Property, Plant and Equipment29
Property, Plant and Equipment (Details) - USD ($) | Sep. 30, 2016 | Dec. 31, 2015 |
Property, Plant and Equipment [Line Items] | ||
Property, plant and equipment, Gross | $ 20,278 | $ 20,278 |
Less: accumulated depreciation | (9,071) | (6,029) |
Property, plant and equipment, net | 11,207 | 14,249 |
Furniture and equipment [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property, plant and equipment, Gross | $ 20,278 | $ 20,278 |
Property, Plant and Equipment30
Property, Plant and Equipment (Details Textual) - USD ($) | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2016 | Sep. 30, 2015 | Sep. 30, 2016 | Sep. 30, 2015 | |
Property Plant and Equipment (Textual) | ||||
Depreciation expense | $ 1,014 | $ 7,225 | $ 3,042 | $ 21,676 |
Debt (Details)
Debt (Details) - USD ($) | Sep. 30, 2016 | Dec. 31, 2015 |
Debt [Abstract] | ||
Promissory notes payable | $ 877,500 | $ 313,993 |
Less: Current maturities | (127,500) | |
Promissory notes payable, net of Current maturities and debt issuance costs | $ 712,111 |
Debt (Details 1)
Debt (Details 1) | Sep. 30, 2016USD ($) |
Debt [Abstract] | |
2016 - (Remainder of year) | $ 45,000 |
2,017 | 832,500 |
2018 and thereafter | |
Long term debt | $ 877,500 |
Debt (Details Textual)
Debt (Details Textual) | Jul. 14, 2016USD ($) | May 03, 2016USD ($)installment | Feb. 19, 2016shares | Feb. 19, 2016USD ($) | Feb. 11, 2016shares | May 07, 2015USD ($)accreditedinvestors$ / sharesshares | Oct. 21, 2016USD ($)shares | Sep. 07, 2016USD ($)$ / sharesshares | Mar. 31, 2016shares | Feb. 22, 2016USD ($)Tradingdaysshares | Feb. 01, 2016USD ($)$ / sharesshares | Jan. 26, 2016USD ($) | Nov. 30, 2015USD ($) | Sep. 21, 2015USD ($) | Sep. 15, 2015USD ($) | Aug. 19, 2015USD ($)Tradingdays$ / sharesshares | Sep. 30, 2016USD ($)shares | Sep. 30, 2015USD ($) | Sep. 30, 2016USD ($)shares | Sep. 30, 2015USD ($) | Jun. 30, 2016USD ($) | Dec. 31, 2015USD ($)shares | Nov. 17, 2015USD ($) |
Short-term Debt [Line Items] | |||||||||||||||||||||||
Aggregate principal amount | $ 925,000 | $ 925,000 | |||||||||||||||||||||
Accrued interest | $ 18,525 | ||||||||||||||||||||||
Outstanding principal balance | $ 113,993 | $ 113,993 | |||||||||||||||||||||
Common stock issued to investors | shares | 25,000 | 10,000 | |||||||||||||||||||||
Common stock shares issued | shares | 16,886,653 | 16,886,653 | 13,915,331 | ||||||||||||||||||||
Restricted common stock issued | shares | 1,000 | ||||||||||||||||||||||
Debt instrument beneficial conversion feature discount | $ 67,637 | ||||||||||||||||||||||
Loss on extinguishment of debt | $ (35,400) | (35,400) | |||||||||||||||||||||
Penalty interest amount | 17,850 | ||||||||||||||||||||||
Debt discount | 49,500 | 49,500 | |||||||||||||||||||||
IPFS [Member] | |||||||||||||||||||||||
Short-term Debt [Line Items] | |||||||||||||||||||||||
Aggregate principal amount | 7,328 | 7,328 | |||||||||||||||||||||
Outstanding principal balance | $ 65,006 | ||||||||||||||||||||||
Interest amount | $ 7,328 | ||||||||||||||||||||||
Accrue interest rate percentage | 3.50% | ||||||||||||||||||||||
FIF [Member] | |||||||||||||||||||||||
Short-term Debt [Line Items] | |||||||||||||||||||||||
Outstanding principal balance | $ 29,700 | ||||||||||||||||||||||
Interest amount | $ 3,352.47 | ||||||||||||||||||||||
Accrue interest rate percentage | 3.80% | ||||||||||||||||||||||
Securities Purchase Agreement [Member] | |||||||||||||||||||||||
Short-term Debt [Line Items] | |||||||||||||||||||||||
Aggregate principal amount | $ 450,000 | ||||||||||||||||||||||
Legal fees | 7,500 | ||||||||||||||||||||||
Placement agent fees | $ 7,500 | ||||||||||||||||||||||
Notes bear interest rate | 0.00% | ||||||||||||||||||||||
Debt maturity date description | Maturity on the thirty-six (36) month anniversary of the respective date of issuance. | ||||||||||||||||||||||
Common stock conversion price per share | $ / shares | $ 1 | ||||||||||||||||||||||
Prepayment penalty paid to investor | $ 5,000 | ||||||||||||||||||||||
Debt conversion converted into common stock | shares | 35,000 | 25,000 | |||||||||||||||||||||
Debt instrument, convertible, trading days | Tradingdays | 20 | ||||||||||||||||||||||
Debt instrument description | If the Debenture is not repaid within six months, the Investor will be able to convert such Debenture at a conversion price equal to 65% of the lowest closing bid price for our common stock during the previous 20 trading days, subject to the terms and conditions contained in the Debenture. | ||||||||||||||||||||||
Debt conversion converted into common stock , value | $ 25,000 | ||||||||||||||||||||||
Letter Agreement [Member] | |||||||||||||||||||||||
Short-term Debt [Line Items] | |||||||||||||||||||||||
Aggregate principal amount | $ 15,000 | ||||||||||||||||||||||
Accrued interest | $ 9,810 | ||||||||||||||||||||||
Debt maturity date description | The maturity date of the Note was extended to January 1, 2017 and the Note shall pay interest as of August 1, 2016 at a rate of 15% per annum, payable in one lump sum on the maturity date. In addition, on any note conversion date from August 9, 2016 through January 1, 2017, the Note is convertible into shares of the Company's common stock at a conversion price of $1.00 per share. | ||||||||||||||||||||||
Common stock conversion price per share | $ / shares | $ 1 | ||||||||||||||||||||||
Debt conversion converted into common stock | shares | 40,000 | ||||||||||||||||||||||
Debt instrument description | On any Note conversion after January 1, 2017, the Note is convertible into shares of the Company's common stock at a conversion price that is the lower of (i) $1.00 per share and (ii) the volume-weighted average price for the last five trading days preceding the conversion date. All remaining terms of the Note remained the same. | ||||||||||||||||||||||
Letter Agreement [Member] | Subsequent Events [Member] | |||||||||||||||||||||||
Short-term Debt [Line Items] | |||||||||||||||||||||||
Accrued interest | $ 7,358 | ||||||||||||||||||||||
Debt maturity date description | The maturity date of the Note was extended to January 1, 2017 and the Note shall pay interest as of August 1, 2016 at a rate of 15% per annum, payable in one lump sum on the maturity date. In addition, on any note conversion date from August 9, 2016 through January 1, 2017, the Note is convertible into shares of the Company's common stock at a conversion price of $1.00 per share. | ||||||||||||||||||||||
Debt conversion converted into common stock | shares | 30,000 | ||||||||||||||||||||||
Debt instrument description | On any Note conversion after January 1, 2017, the Note is convertible into shares of the Company's common stock at a conversion price that is the lower of (i) $1.00 per share and (ii) the volume-weighted average price for the last five trading days preceding the conversion date. All remaining terms of the Note remained the same. | ||||||||||||||||||||||
Letter Agreement [Member] | Maximum [Member] | |||||||||||||||||||||||
Short-term Debt [Line Items] | |||||||||||||||||||||||
Aggregate principal amount | $ 242,810 | ||||||||||||||||||||||
Letter Agreement [Member] | Maximum [Member] | Subsequent Events [Member] | |||||||||||||||||||||||
Short-term Debt [Line Items] | |||||||||||||||||||||||
Aggregate principal amount | $ 170,858 | ||||||||||||||||||||||
Letter Agreement [Member] | Minimum [Member] | |||||||||||||||||||||||
Short-term Debt [Line Items] | |||||||||||||||||||||||
Aggregate principal amount | $ 218,000 | ||||||||||||||||||||||
Letter Agreement [Member] | Minimum [Member] | Subsequent Events [Member] | |||||||||||||||||||||||
Short-term Debt [Line Items] | |||||||||||||||||||||||
Aggregate principal amount | $ 163,500 | ||||||||||||||||||||||
Promissory Note Monthly Principal Payment Agreement One [Member] | |||||||||||||||||||||||
Short-term Debt [Line Items] | |||||||||||||||||||||||
Interest amount | $ 10,000 | ||||||||||||||||||||||
Debt instrument monthly principal payment | $ 10,000 | ||||||||||||||||||||||
Number of installments | installment | 1 | ||||||||||||||||||||||
Promissory Note Monthly Principal Payment Agreement Two [Member] | |||||||||||||||||||||||
Short-term Debt [Line Items] | |||||||||||||||||||||||
Debt instrument monthly principal payment | $ 12,500 | ||||||||||||||||||||||
Number of installments | installment | 1 | ||||||||||||||||||||||
Promissory Note Monthly Principal Payment Agreement Three [Member] | |||||||||||||||||||||||
Short-term Debt [Line Items] | |||||||||||||||||||||||
Debt instrument monthly principal payment | $ 15,000 | ||||||||||||||||||||||
Number of installments | installment | 11 | ||||||||||||||||||||||
Promissory Note Monthly Principal Payment Agreement Four [Member] | |||||||||||||||||||||||
Short-term Debt [Line Items] | |||||||||||||||||||||||
Debt instrument monthly principal payment | $ 2,500 | ||||||||||||||||||||||
Number of installments | installment | 1 | ||||||||||||||||||||||
Credit Agreement [Member] | |||||||||||||||||||||||
Short-term Debt [Line Items] | |||||||||||||||||||||||
Aggregate principal amount | $ 670,000 | 750,000 | 750,000 | ||||||||||||||||||||
Maturity date | Dec. 20, 2017 | ||||||||||||||||||||||
Percentage of interest rate | 15.00% | ||||||||||||||||||||||
General operating expenses | $ 1,000,000 | ||||||||||||||||||||||
Percentage of increasing interest rate | 19.00% | ||||||||||||||||||||||
Interest rate for loan | $ 75,000 | ||||||||||||||||||||||
Incurred loan fees | $ 44,500 | ||||||||||||||||||||||
Convertible Notes Payable [Member] | |||||||||||||||||||||||
Short-term Debt [Line Items] | |||||||||||||||||||||||
Aggregate principal amount | $ 450,000 | $ 170,000 | 170,000 | 170,000 | |||||||||||||||||||
Outstanding principal balance | 109,000 | $ 109,000 | $ 450,000 | ||||||||||||||||||||
Legal fees | 22,500 | ||||||||||||||||||||||
Placement agent fees | $ 22,500 | ||||||||||||||||||||||
Interest amount | $ 40,500 | ||||||||||||||||||||||
Number of accredited investors | accreditedinvestors | 3 | ||||||||||||||||||||||
Maturity date | Feb. 1, 2016 | Aug. 19, 2016 | Jul. 1, 2016 | ||||||||||||||||||||
Notes bear interest rate | 9.00% | 9.00% | 15.00% | ||||||||||||||||||||
Debt maturity date description | The Note is convertible into shares of the Company's common stock at a conversion price equal to: (i) from the Effective Date through the Maturity Date at $1.00 per share; and (ii) beginning one day after the Maturity Date, or notwithstanding the foregoing, at any time after the Company has registered shares of its common stock underlying the Note in a registration statement on Form S-1 or any other form applicable thereto, the lower of i) $1.00 per share and ii) 60% of the volume-weighted average price for the last twenty trading days preceding the conversion date. | ||||||||||||||||||||||
Common stock conversion price per share | $ / shares | $ 1 | $ 1 | |||||||||||||||||||||
Common stock issued to investors | shares | 45,000 | 45,000 | |||||||||||||||||||||
Debt discount related to common stock issued | $ 45,000 | $ 30,637 | |||||||||||||||||||||
Debt conversion converted into common stock | shares | 45,000 | ||||||||||||||||||||||
Debt instrument, convertible, trading days | Tradingdays | 20 | ||||||||||||||||||||||
Debt instrument description | The notes are converted into common stock if the Company undertakes a qualified offering of securities of at least $2,000,000 (the "Qualified Offering"). | ||||||||||||||||||||||
Percentage of interest rate | 12.00% | ||||||||||||||||||||||
Common stock shares issued | shares | 35,000 | ||||||||||||||||||||||
Restricted common stock issued | shares | 35,000 | ||||||||||||||||||||||
Debt instrument beneficial conversion feature discount | $ 67,637 | ||||||||||||||||||||||
Debt conversion, description | On any Note conversion after July 1, 2016, the Notes are convertible into shares of the Company's common stock at a conversion price that is the lower of (i) $1.00 per share and (ii) the volume-weighted average price for the last five trading days preceding the conversion date. | ||||||||||||||||||||||
Convertible Notes Payable [Member] | Glenn Tilley [Member] | |||||||||||||||||||||||
Short-term Debt [Line Items] | |||||||||||||||||||||||
Aggregate principal amount | 163,500 | $ 163,500 | |||||||||||||||||||||
Convertible Notes Payable [Member] | Maximum [Member] | |||||||||||||||||||||||
Short-term Debt [Line Items] | |||||||||||||||||||||||
Aggregate principal amount | $ 490,500 | ||||||||||||||||||||||
Convertible Notes Payable [Member] | Minimum [Member] | |||||||||||||||||||||||
Short-term Debt [Line Items] | |||||||||||||||||||||||
Aggregate principal amount | $ 450,000 | ||||||||||||||||||||||
Debenture One [Member] | Securities Purchase Agreement [Member] | |||||||||||||||||||||||
Short-term Debt [Line Items] | |||||||||||||||||||||||
Aggregate principal amount | 150,000 | ||||||||||||||||||||||
Outstanding principal balance | $ 150,000 | ||||||||||||||||||||||
Prepayment penalty paid to investor | $ 45,000 | ||||||||||||||||||||||
Debt discount related to common stock issued | 15,000 | ||||||||||||||||||||||
Convertible debentures, purchase price | 135,000 | ||||||||||||||||||||||
Debenture Two [Member] | Securities Purchase Agreement [Member] | |||||||||||||||||||||||
Short-term Debt [Line Items] | |||||||||||||||||||||||
Aggregate principal amount | 150,000 | ||||||||||||||||||||||
Convertible debentures, purchase price | 135,000 | ||||||||||||||||||||||
Debenture Three [Member] | Securities Purchase Agreement [Member] | |||||||||||||||||||||||
Short-term Debt [Line Items] | |||||||||||||||||||||||
Aggregate principal amount | 150,000 | ||||||||||||||||||||||
Convertible debentures, purchase price | 135,000 | ||||||||||||||||||||||
Debenture Four [Member] | Securities Purchase Agreement [Member] | |||||||||||||||||||||||
Short-term Debt [Line Items] | |||||||||||||||||||||||
Aggregate principal amount | $ 150,000 | ||||||||||||||||||||||
Promissory Note Agreement [Member] | |||||||||||||||||||||||
Short-term Debt [Line Items] | |||||||||||||||||||||||
Aggregate principal amount | $ 10,000 | $ 163,993 | $ 200,000 | 190,000 | 190,000 | ||||||||||||||||||
Accrued interest | $ 10,000 | 2,486 | |||||||||||||||||||||
Outstanding principal balance | $ 127,500 | $ 127,500 | |||||||||||||||||||||
Placement agent fees | $ 10,000 | ||||||||||||||||||||||
Maturity date | Jul. 1, 2017 | ||||||||||||||||||||||
Notes bear interest rate | 8.00% | 5.00% | 8.00% | ||||||||||||||||||||
Debt discount related to common stock issued | $ 8,000 | ||||||||||||||||||||||
Debt instrument description | The first $100,000 of the loan is payable upon the Company raising $500,000 in a qualified offering (as defined therein). The remaining balances is payable upon the Company raising $1,000,000 in a qualified offering. | ||||||||||||||||||||||
Proceeds from promissory notes | $ 155,993 | ||||||||||||||||||||||
Debt instrument outstanding principal payment | $ 50,000 |
Factor Agreement (Details)
Factor Agreement (Details) - USD ($) | 1 Months Ended | 9 Months Ended |
Mar. 28, 2016 | Sep. 30, 2016 | |
Factor Agreement [Abstract] | ||
Financial services company advances, percentage | 80.00% | |
Financial services company reserve, percentage | 20.00% | |
Percentage charged on the face value of each invoice purchased | 2.00% | |
Percentage for every 30 days the invoice remains outstanding | 0.008% | |
Accounts receivable purchased by the Factor | $ 353,648 | |
Advances from the Factor | 282,917 | |
Due to factor |
Stockholders Equity (Deficit)35
Stockholders Equity (Deficit) (Details) | 9 Months Ended |
Sep. 30, 2016 | |
Stockholders Equity (Deficit) [Abstract] | |
Risk free interest rate | 1.73% |
Dividend yield | 0.00% |
Expected volatility | 45.25% |
Expected life in years | 5 years |
Forfeiture Rate | 0.00% |
Stockholders Equity (Deficit)36
Stockholders Equity (Deficit) (Details 1) - Stock Option [Member] | 9 Months Ended |
Sep. 30, 2016$ / sharesshares | |
Class of Stock [Line Items] | |
Options/Warrant, Outstanding | shares | 430,000 |
Options/Warrants, Granted | shares | 200,000 |
Options/Warrants, Exercised | shares | |
Options/Warrants, Forfeited/Cancelled | shares | (7,500) |
Options/Warrants, Outstanding | shares | 622,500 |
Options/Warrants, Exercisable | shares | 422,500 |
Weighted average exercise price, Outstanding | $ / shares | $ 1.03 |
Weighted average exercise price, Granted | $ / shares | 1 |
Weighted average exercise price, Exercised | $ / shares | |
Weighted average exercise price, Forfeited/Cancelled | $ / shares | 1.50 |
Weighted average exercise price, Outstanding | $ / shares | 1.02 |
Weighted average exercise price, Exercisable | $ / shares | $ 1.03 |
Weighted average remaining contractual life, Outstanding | 5 years |
Weighted average remaining contractual life, Granted | 5 years |
Weighted average remaining contractual life, Outstanding | 3 years 9 months 26 days |
Weighted average remaining contractual life, Exercisable | 3 years 8 months 23 days |
Stockholders Equity (Deficit)37
Stockholders Equity (Deficit) (Details 2) - Warrant [Member] | 9 Months Ended |
Sep. 30, 2016$ / sharesshares | |
Class of Stock [Line Items] | |
Options/Warrant, Outstanding | shares | 508,068 |
Options/Warrants, Granted | shares | 171,520 |
Options/Warrants, Exercised | shares | |
Options/Warrants, Forfeited/Cancelled | shares | |
Options/Warrants, Outstanding | shares | 679,588 |
Options/Warrants, Exercisable | shares | 679,588 |
Weighted average exercise price, Outstanding | $ / shares | $ 1 |
Weighted average exercise price, Granted | $ / shares | 1.10 |
Weighted average exercise price, Exercised | $ / shares | |
Weighted average exercise price, Forfeited/Cancelled | $ / shares | |
Weighted average exercise price, Outstanding | $ / shares | 1.03 |
Weighted average exercise price, Exercisable | $ / shares | $ 1.03 |
Weighted average remaining contractual life, Outstanding | 3 years 1 month 17 days |
Weighted average remaining contractual life, Outstanding | 2 years 10 months 28 days |
Weighted average remaining contractual life, Exercisable | 2 years 10 months 28 days |
Stockholders Equity (Deficit)38
Stockholders Equity (Deficit) (Details Textual) | Feb. 19, 2016shares | Mar. 31, 2016USD ($)Investorsshares | Feb. 22, 2016shares | Feb. 01, 2016shares | Aug. 19, 2015shares | Sep. 30, 2016USD ($)$ / sharesshares | Sep. 30, 2015USD ($) | Sep. 30, 2016USD ($)$ / sharesshares | Sep. 30, 2015USD ($) | Jun. 30, 2016USD ($)shares | Dec. 31, 2015$ / sharesshares |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||||||
Preferred stock, shares authorized | 20,000,000 | 20,000,000 | 20,000,000 | ||||||||
Preferred stock, par value | $ / shares | $ 0.00001 | $ 0.00001 | $ 0.00001 | ||||||||
Preferred stock, shares issued | |||||||||||
Preferred stock, shares outstanding | |||||||||||
Common stock, shares authorized | 250,000,000 | 250,000,000 | 250,000,000 | ||||||||
Common stock, par value | $ / shares | $ 0.00001 | $ 0.00001 | $ 0.00001 | ||||||||
Common stock, shares issued | 16,886,653 | 16,886,653 | 13,915,331 | ||||||||
Common stock, shares outstanding | 16,886,653 | 16,886,653 | 13,915,331 | ||||||||
Restricted Stock were granted during the period, shares | 1,000 | ||||||||||
Restricted shares were granted during the period | $ | $ 1,100 | ||||||||||
Stock-based compensation for stock options | $ | $ 35,422 | $ 16,519 | $ 105,143 | $ 39,720 | |||||||
Unamortized expense | $ | 99,142 | 99,142 | |||||||||
Intrinsic value of options outstanding | $ | 0 | 0 | $ 0 | 0 | |||||||
Amortized term | 1 year | ||||||||||
Intrinsic value of options exercisable | $ | 0 | 0 | $ 0 | 0 | |||||||
Intrinsic value of warrants outstanding and exercisable | $ | $ 0 | $ 0 | $ 0 | $ 0 | |||||||
Common stock shares issued for professional services | 882,127 | ||||||||||
Common stock value issued for professional services | $ | $ 648,839 | ||||||||||
Warrants exercise price | $ / shares | $ 1.10 | $ 1.10 | |||||||||
Common stock issued for services employee fair value | $ | $ 1,500 | $ 1,500 | $ 1,650 | ||||||||
Common stock issued for services employee fair value, shares | 495 | 495 | 1,500 | ||||||||
Jeromy Olson, CEO [Member] | |||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||||||
Common stock shares issued for employment agreement | 250,000 | ||||||||||
Common stock value issued for employment agreement | $ | $ 275,000 | ||||||||||
Private placement [Member] | |||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||||||
Common stock shares sold to investors in exchange | 1,715,195 | ||||||||||
Gross proceeds in connection with the private placement | $ | $ 1,886,712 | ||||||||||
Placement agent fee | $ | $ 245,305 | ||||||||||
Warrants exercise price | $ / shares | $ 1.10 | $ 1.10 | |||||||||
Warrants issued, Shares | 171,520 | 171,520 | |||||||||
Proceeds from issuance of warrants | $ | $ 76,927 | ||||||||||
Convertible notes payable [Member] | |||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||||||
Common stock, shares issued | 35,000 | ||||||||||
Restricted Stock were granted during the period, shares | 35,000 | ||||||||||
Debt conversion converted into common stock | 45,000 | ||||||||||
Number of investors | Investors | 3 | ||||||||||
Securities Purchase Agreement [Member] | |||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||||||
Debt conversion converted into common stock | 35,000 | 25,000 | |||||||||
Employee stock option [Member] | |||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||||||
Number of stock option authorized | 200,000 | 200,000 | |||||||||
Number of stock option authorized, fair value | $ | $ 97,500 | ||||||||||
Vesting period | 2 years | ||||||||||
Stock option expire date | Jan. 4, 2021 |
Related Party Transactions (Det
Related Party Transactions (Details) - USD ($) | Mar. 31, 2016 | Feb. 11, 2016 | Sep. 30, 2016 | Sep. 30, 2015 | Sep. 30, 2016 | Sep. 30, 2015 |
Related Party Transactions (Textual) | ||||||
Common stock shares issued to NexPhase Global | 25,000 | 10,000 | ||||
Jeromy Olson, CEO [Member] | ||||||
Related Party Transactions (Textual) | ||||||
Consulting expenses | $ 78,300 | $ 60,000 | $ 200,300 | $ 110,000 | ||
Holding percentage of management in Vendors Company | 50.00% | 50.00% | ||||
Common stock shares issued to NexPhase Global | 10,000 | 10,000 | 30,000 | 30,000 | ||
Common stock shares, value issued to NexPhase Global | $ 3,300 | $ 10,000 | $ 25,300 | $ 30,000 | ||
Glenn Tilley [Member] | ||||||
Related Party Transactions (Textual) | ||||||
Debt conversion converted into common stock | 15,000 | 45,000 |
Commitments and Contingencies (
Commitments and Contingencies (Details) - USD ($) | Aug. 09, 2016 | Apr. 14, 2016 | Mar. 14, 2016 | Feb. 11, 2016 | Jan. 04, 2016 | Dec. 02, 2015 | Sep. 23, 2015 | Aug. 16, 2015 | Aug. 12, 2015 | Dec. 10, 2014 | Apr. 30, 2016 | Mar. 31, 2016 | Feb. 19, 2016 | Dec. 31, 2015 | Nov. 30, 2015 | Feb. 28, 2015 | Sep. 30, 2014 | Mar. 31, 2014 | Sep. 30, 2016 | Sep. 30, 2015 | Sep. 30, 2016 | Sep. 30, 2015 |
Loss Contingencies [Line Items] | ||||||||||||||||||||||
Issuance of common stock for services | 7,317 | |||||||||||||||||||||
New shares issued during the period, shares | 25,000 | 10,000 | ||||||||||||||||||||
Administrative proceedings, description | The Company is engaged in an administrative proceeding against a former employee who was terminated from his positions with the Company for cause on May 12, 2014. The former employee has claimed he is due between $24,000 and $48,000 in unpaid wages. | |||||||||||||||||||||
Operating Leases [Member] | ||||||||||||||||||||||
Loss Contingencies [Line Items] | ||||||||||||||||||||||
Rent expenses | $ 4,021 | $ 2,600 | $ 10,492 | $ 14,617 | ||||||||||||||||||
Monthly lease payments | $ 1,045 | |||||||||||||||||||||
Operating lease, description | The rents for the first and seventh months of 2016 are free. The lease automatically renews for periods of 12 months unless a three month notice is provided by either the Company or the landlord. | |||||||||||||||||||||
Security deposit to lessor | $ 2,090 | $ 2,090 | ||||||||||||||||||||
Chief Executive Officer [Member] | ||||||||||||||||||||||
Loss Contingencies [Line Items] | ||||||||||||||||||||||
New shares issued during the period, shares | 10,000 | 10,000 | 30,000 | 30,000 | ||||||||||||||||||
Service Agreements [Member] | Consultant One [Member] | ||||||||||||||||||||||
Loss Contingencies [Line Items] | ||||||||||||||||||||||
Common stock issued as compensation for services | 50,000 | |||||||||||||||||||||
Additional shares of common stock obligated to issue | 100,000 | |||||||||||||||||||||
Compensation expense | $ (51,202) | $ 28,361 | ||||||||||||||||||||
Service Agreements [Member] | Consultant Two [Member] | ||||||||||||||||||||||
Loss Contingencies [Line Items] | ||||||||||||||||||||||
Compensation expense | (12,449) | $ 52,818 | ||||||||||||||||||||
Issuance of common stock for services | 62,500 | |||||||||||||||||||||
Common stock issued, description | On November 15, 2016, the Company is obligated to issue an additional 62,500 shares of the Company's common stock. | |||||||||||||||||||||
Service Agreements [Member] | Consultant Three [Member] | ||||||||||||||||||||||
Loss Contingencies [Line Items] | ||||||||||||||||||||||
Compensation expense | 13,646 | $ 85,534 | ||||||||||||||||||||
Issuance of common stock for services | 62,500 | |||||||||||||||||||||
Compensation for the services | $ 12,000 | |||||||||||||||||||||
Service Agreements [Member] | Consultant Four [Member] | ||||||||||||||||||||||
Loss Contingencies [Line Items] | ||||||||||||||||||||||
Compensation expense | 4,482 | 6,982 | ||||||||||||||||||||
Issuance of common stock for services | 1,000 | |||||||||||||||||||||
Compensation for the services | $ 2,400 | |||||||||||||||||||||
Service Agreements [Member] | Consultant Five [Member] | ||||||||||||||||||||||
Loss Contingencies [Line Items] | ||||||||||||||||||||||
Compensation expense | 11,508 | 11,508 | ||||||||||||||||||||
Description of agreement | On February 9, 2017, the Company is obligated to issue an additional $50,000 in shares of the Company common stock based on a share price equal to the average closing price of the preceding 10 trading days. The Company may terminate the agreement during the month of February 2017 by providing written notice. The first tranche of shares vest on February 8, 2017 and the second tranche of shares vest on August 8, 2017. The Company agrees to increase the monthly consulting fee to $10,000 per month for the remaining months under the current term upon the closing of a capital raise in excess of $3,000,000. | |||||||||||||||||||||
Compensation for the services | $ 5,000 | |||||||||||||||||||||
Issuance of common stock for services value | $ 50,000 | |||||||||||||||||||||
Consulting Agreement [Member] | ||||||||||||||||||||||
Loss Contingencies [Line Items] | ||||||||||||||||||||||
Monthly fee | $ 10,000 | $ 6,000 | ||||||||||||||||||||
Shares received upon agreement execution | 50,000 | |||||||||||||||||||||
New shares issued during the period, shares | 50,000 | 10,000 | ||||||||||||||||||||
Agreement term | 18 months | |||||||||||||||||||||
Monthly lease payments | $ 10,000 | |||||||||||||||||||||
Consulting agreement description | The monthly fee was increased to $20,000 per month for a period of twelve months. At the end of the twelve month period the monthly payment reverts back to $10,000. | |||||||||||||||||||||
Consulting Agreement [Member] | Exercise price of $1.50 [Member] | ||||||||||||||||||||||
Loss Contingencies [Line Items] | ||||||||||||||||||||||
Exercise price of option | $ 1.50 | |||||||||||||||||||||
Vesting date of options | Dec. 31, 2015 | |||||||||||||||||||||
Number of stock options issued or issuable | 100,000 | |||||||||||||||||||||
Consulting Agreement [Member] | Exercise price of $1.75 [Member] | ||||||||||||||||||||||
Loss Contingencies [Line Items] | ||||||||||||||||||||||
Exercise price of option | $ 1.75 | |||||||||||||||||||||
Vesting date of options | Dec. 31, 2016 | |||||||||||||||||||||
Number of stock options issued or issuable | 100,000 | |||||||||||||||||||||
Consulting Agreement [Member] | Exercise price of $2.50 [Member] | ||||||||||||||||||||||
Loss Contingencies [Line Items] | ||||||||||||||||||||||
Exercise price of option | $ 2.50 | |||||||||||||||||||||
Vesting date of options | Dec. 31, 2017 | |||||||||||||||||||||
Number of stock options issued or issuable | 100,000 | |||||||||||||||||||||
Consulting Agreement [Member] | Maximum [Member] | ||||||||||||||||||||||
Loss Contingencies [Line Items] | ||||||||||||||||||||||
Percentage of commissions on sales | 3.50% | |||||||||||||||||||||
Consulting Agreement [Member] | Minimum [Member] | ||||||||||||||||||||||
Loss Contingencies [Line Items] | ||||||||||||||||||||||
Percentage of commissions on sales | 5.00% | |||||||||||||||||||||
Consulting Agreements 1 [Member] | ||||||||||||||||||||||
Loss Contingencies [Line Items] | ||||||||||||||||||||||
Compensation expense | 11,000 | 33,000 | ||||||||||||||||||||
Percentage of commissions on sales | 5.00% | |||||||||||||||||||||
Monthly fee | $ 2,500 | |||||||||||||||||||||
Shares received upon agreement execution | 10,000 | |||||||||||||||||||||
New shares issued during the period, shares | 50,000 | |||||||||||||||||||||
Description of agreement | The Company may terminate this agreement by providing 5 days advance written notice in the first 60 days of entering into this agreement and with 30 days advance written notice thereafter for the duration of the agreement. | |||||||||||||||||||||
Consulting Agreements 2 [Member] | ||||||||||||||||||||||
Loss Contingencies [Line Items] | ||||||||||||||||||||||
Compensation expense | (12,666) | 5,447 | ||||||||||||||||||||
Percentage of commissions on sales | 5.00% | |||||||||||||||||||||
Shares received upon agreement execution | 100,000 | |||||||||||||||||||||
Consulting Agreements 2 [Member] | Clawback [Member] | ||||||||||||||||||||||
Loss Contingencies [Line Items] | ||||||||||||||||||||||
Payment shares forfeited, and cancelled | 50,000 | |||||||||||||||||||||
Consulting Agreements 2 [Member] | Clawback 1 [Member] | ||||||||||||||||||||||
Loss Contingencies [Line Items] | ||||||||||||||||||||||
Payment shares forfeited, and cancelled | 25,000 | |||||||||||||||||||||
Consulting Agreements 3 [Member] | ||||||||||||||||||||||
Loss Contingencies [Line Items] | ||||||||||||||||||||||
Compensation expense | 0 | 8,333 | ||||||||||||||||||||
Percentage of commissions on sales | 5.00% | |||||||||||||||||||||
Monthly fee | $ 5,000 | |||||||||||||||||||||
New shares issued during the period, shares | 20,000 | |||||||||||||||||||||
Agreement term | 18 months | |||||||||||||||||||||
Consulting Agreements 3 [Member] | 30 days of execution [Member] | ||||||||||||||||||||||
Loss Contingencies [Line Items] | ||||||||||||||||||||||
Shares received upon agreement execution | 25,000 | |||||||||||||||||||||
Consulting Agreements 3 [Member] | 15 days of execution [Member] | ||||||||||||||||||||||
Loss Contingencies [Line Items] | ||||||||||||||||||||||
Shares received upon agreement execution | 25,000 | |||||||||||||||||||||
Consulting Agreements 4 [Member] | ||||||||||||||||||||||
Loss Contingencies [Line Items] | ||||||||||||||||||||||
Compensation expense | (4,000) | 9,700 | ||||||||||||||||||||
Shares received upon agreement execution | 75,000 | |||||||||||||||||||||
Agreement term | 3 years | |||||||||||||||||||||
Consulting Agreements 4 [Member] | Clawback [Member] | ||||||||||||||||||||||
Loss Contingencies [Line Items] | ||||||||||||||||||||||
Payment shares forfeited, and cancelled | 50,000 | |||||||||||||||||||||
Consulting Agreements 4 [Member] | Clawback 1 [Member] | ||||||||||||||||||||||
Loss Contingencies [Line Items] | ||||||||||||||||||||||
Payment shares forfeited, and cancelled | 25,000 | |||||||||||||||||||||
Consulting Agreements 5 [Member] | ||||||||||||||||||||||
Loss Contingencies [Line Items] | ||||||||||||||||||||||
Compensation expense | (1,385) | 53,414 | ||||||||||||||||||||
Percentage of commissions on sales | 5.00% | |||||||||||||||||||||
Shares received upon agreement execution | 25,000 | |||||||||||||||||||||
New shares issued during the period, shares | 125,000 | |||||||||||||||||||||
Agreement term | 18 months | |||||||||||||||||||||
Number of stock options issued or issuable | 25,000 | |||||||||||||||||||||
Consulting Agreements 6 [Member] | ||||||||||||||||||||||
Loss Contingencies [Line Items] | ||||||||||||||||||||||
Compensation expense | 4,436 | 9,596 | ||||||||||||||||||||
Percentage of commissions on sales | 1.00% | |||||||||||||||||||||
Shares received upon agreement execution | 4,000 | |||||||||||||||||||||
New shares issued during the period, shares | 10,000 | |||||||||||||||||||||
Agreement term | 1 year | |||||||||||||||||||||
Increase of gross revenues | $ 1,000,000 | |||||||||||||||||||||
Consulting Agreements 7 [Member] | ||||||||||||||||||||||
Loss Contingencies [Line Items] | ||||||||||||||||||||||
Compensation expense | 2,689 | 7,824 | ||||||||||||||||||||
Percentage of commissions on sales | 4.00% | |||||||||||||||||||||
Shares received upon agreement execution | 4,000 | |||||||||||||||||||||
New shares issued during the period, shares | 10,000 | |||||||||||||||||||||
Increase of gross revenues | $ 1,000,000 | |||||||||||||||||||||
Consulting Agreements 7 [Member] | Chief Revenue Officer [Member] | ||||||||||||||||||||||
Loss Contingencies [Line Items] | ||||||||||||||||||||||
Number of stock options issued or issuable | 100,000 | |||||||||||||||||||||
Employment Agreement [Member] | Chief Executive Officer [Member] | ||||||||||||||||||||||
Loss Contingencies [Line Items] | ||||||||||||||||||||||
New shares issued during the period, shares | 250,000 | |||||||||||||||||||||
Agreement term | 40 months | |||||||||||||||||||||
Increase of gross revenues | $ 16,000 | |||||||||||||||||||||
Operating margin rate | 15.00% | |||||||||||||||||||||
Employment Agreement [Member] | Chief Executive Officer [Member] | 5% annual Adjusted EBITDA [Member] | ||||||||||||||||||||||
Loss Contingencies [Line Items] | ||||||||||||||||||||||
EBITDA | $ 2,000,000 | |||||||||||||||||||||
Employment Agreement [Member] | Chief Executive Officer [Member] | Exercise price of $1.50 [Member] | ||||||||||||||||||||||
Loss Contingencies [Line Items] | ||||||||||||||||||||||
Exercise price of option | $ 1.50 | |||||||||||||||||||||
Vesting date of options | Dec. 31, 2015 | |||||||||||||||||||||
Number of stock options issued or issuable | 100,000 | |||||||||||||||||||||
Employment Agreement [Member] | Chief Executive Officer [Member] | Exercise price of $1.75 [Member] | ||||||||||||||||||||||
Loss Contingencies [Line Items] | ||||||||||||||||||||||
Exercise price of option | $ 1.75 | |||||||||||||||||||||
Vesting date of options | Dec. 31, 2016 | |||||||||||||||||||||
Number of stock options issued or issuable | 100,000 | |||||||||||||||||||||
Employment Agreement [Member] | Chief Executive Officer [Member] | Exercise price of $2.50 [Member] | ||||||||||||||||||||||
Loss Contingencies [Line Items] | ||||||||||||||||||||||
Exercise price of option | $ 2.50 | |||||||||||||||||||||
Vesting date of options | Dec. 31, 2017 | |||||||||||||||||||||
Number of stock options issued or issuable | 100,000 | |||||||||||||||||||||
Employment Agreement [Member] | Chief Executive Officer [Member] | Maximum [Member] | ||||||||||||||||||||||
Loss Contingencies [Line Items] | ||||||||||||||||||||||
Officer salary per month | $ 13,000 | |||||||||||||||||||||
Increase of gross revenues | 15,000,000 | |||||||||||||||||||||
Employment Agreement [Member] | Chief Executive Officer [Member] | Maximum [Member] | 15% annual Adjusted EBITDA [Member] | ||||||||||||||||||||||
Loss Contingencies [Line Items] | ||||||||||||||||||||||
EBITDA | 1,000,000 | |||||||||||||||||||||
Employment Agreement [Member] | Chief Executive Officer [Member] | Maximum [Member] | 10% annual Adjusted EBITDA [Member] | ||||||||||||||||||||||
Loss Contingencies [Line Items] | ||||||||||||||||||||||
EBITDA | 2,000,000 | |||||||||||||||||||||
Employment Agreement [Member] | Chief Executive Officer [Member] | Minimum [Member] | ||||||||||||||||||||||
Loss Contingencies [Line Items] | ||||||||||||||||||||||
Officer salary per month | 10,000 | |||||||||||||||||||||
Increase of gross revenues | 10,000,000 | |||||||||||||||||||||
Employment Agreement [Member] | Chief Executive Officer [Member] | Minimum [Member] | 15% annual Adjusted EBITDA [Member] | ||||||||||||||||||||||
Loss Contingencies [Line Items] | ||||||||||||||||||||||
EBITDA | 1 | |||||||||||||||||||||
Employment Agreement [Member] | Chief Executive Officer [Member] | Minimum [Member] | 10% annual Adjusted EBITDA [Member] | ||||||||||||||||||||||
Loss Contingencies [Line Items] | ||||||||||||||||||||||
EBITDA | $ 1,000,001 | |||||||||||||||||||||
Director Agreements [Member] | ||||||||||||||||||||||
Loss Contingencies [Line Items] | ||||||||||||||||||||||
Fair value of options granted | $ 97,535 | |||||||||||||||||||||
Stipend paid | $ 1,000,000 | |||||||||||||||||||||
Options issued to purchase common shares | 200,000 | |||||||||||||||||||||
Number of stock options issued or issuable | 25,000 | |||||||||||||||||||||
Stock option vesting rights | The Options shall vest in equal amounts over a period of two (2) years at the rate of Twenty Five Thousand (25,000) shares per fiscal quarter on the last day of each such quarter, commencing January 4, 2016. | |||||||||||||||||||||
Vesting period | 2 years | |||||||||||||||||||||
Advisory Board Agreements [Member] | ||||||||||||||||||||||
Loss Contingencies [Line Items] | ||||||||||||||||||||||
Compensation expense | 6,137 | 14,876 | ||||||||||||||||||||
New shares issued during the period, shares | 25,000 | |||||||||||||||||||||
Supply Agreement [Member] | ||||||||||||||||||||||
Loss Contingencies [Line Items] | ||||||||||||||||||||||
Description of agreement | As consideration for its designation as IMG's "Official Supplier" the Company must pay IMG three installments of $208,000 during the Term as specified in the Agreement. | |||||||||||||||||||||
Accounts payable and accrued expenses | $ 117,376 | $ 117,376 |
Subsequent Events (Details)
Subsequent Events (Details) - $ / shares | Nov. 03, 2016 | Oct. 04, 2016 | Feb. 11, 2016 | Dec. 10, 2014 | Dec. 31, 2016 | Sep. 30, 2014 | Mar. 31, 2014 | Sep. 30, 2016 | Sep. 30, 2015 | Sep. 30, 2016 | Sep. 30, 2015 |
Subsequent Event (Textual) | |||||||||||
Shares issued for services, Share | 7,317 | ||||||||||
Common stock shares | 25,000 | 10,000 | |||||||||
Mr Tilley [Member] | |||||||||||
Subsequent Event (Textual) | |||||||||||
Shares issued for services, Share | 62,000 | ||||||||||
Common stock shares | 30,000 | ||||||||||
Chief Executive Officer [Member] | |||||||||||
Subsequent Event (Textual) | |||||||||||
Common stock shares | 10,000 | 10,000 | 30,000 | 30,000 | |||||||
Employment Agreement [Member] | Chief Executive Officer [Member] | |||||||||||
Subsequent Event (Textual) | |||||||||||
Common stock shares | 250,000 | ||||||||||
Consulting Agreement [Member] | |||||||||||
Subsequent Event (Textual) | |||||||||||
Common stock shares | 50,000 | 10,000 | |||||||||
Subsequent Events [Member] | Incentive stock option [Member] | |||||||||||
Subsequent Event (Textual) | |||||||||||
Common stock shares | 2,500,000 | ||||||||||
Subsequent Events [Member] | 2016 Plan [Member] | |||||||||||
Subsequent Event (Textual) | |||||||||||
Common stock shares | 2,500,000 | ||||||||||
Percentage of common stock | 15.00% | ||||||||||
Subsequent Events [Member] | 2016 Plan one [Member] | |||||||||||
Subsequent Event (Textual) | |||||||||||
Common stock shares | 2,500,000 | ||||||||||
Subsequent Events [Member] | Employment Agreement [Member] | Chief Executive Officer [Member] | |||||||||||
Subsequent Event (Textual) | |||||||||||
Option to purchase shares of common stock | 100,000 | 75,000 | |||||||||
Stock options price | $ 1.50 | $ 1.75 | |||||||||
Vesting date of options | Nov. 3, 2016 | Dec. 31, 2016 | |||||||||
Subsequent Events [Member] | Consulting Agreement [Member] | Chief Executive Officer [Member] | |||||||||||
Subsequent Event (Textual) | |||||||||||
Option to purchase shares of common stock | 100,000 | 75,000 | |||||||||
Stock options price | $ 1.50 | $ 1.75 | |||||||||
Vesting date of options | Nov. 3, 2016 | Dec. 31, 2016 |