Document and Entity Information
Document and Entity Information - shares | 9 Months Ended | |
Oct. 31, 2016 | Dec. 08, 2016 | |
Document and Entity Information [Abstract] | ||
Entity Registrant Name | Gawk Inc. | |
Entity Central Index Key | 1,546,392 | |
Trading Symbol | gawk | |
Current Fiscal Year End Date | --01-31 | |
Entity Filer Category | Smaller Reporting Company | |
Entity Common Stock, Shares Outstanding | 1,280,741,569 | |
Document Type | 10-Q | |
Document Period End Date | Oct. 31, 2016 | |
Amendment Flag | false | |
Document Fiscal Year Focus | 2,017 | |
Document Fiscal Period Focus | Q3 |
CONSOLIDATED BALANCE SHEETS (Un
CONSOLIDATED BALANCE SHEETS (Unaudited) - USD ($) | Oct. 31, 2016 | Jan. 31, 2016 |
Current Assets | ||
Cash and cash equivalents | $ 188,583 | $ 64,944 |
Accounts receivable | 246,749 | 45,721 |
Marketable securities - available for sale | 162,900 | 78,300 |
Deposit - CipherLoc | 562,500 | 562,500 |
Prepaid and other current assets | 55,514 | 32,200 |
Total Current Assets | 1,216,246 | 783,665 |
Equipment, net of depreciation of $0 and $73,740 | 103,235 | |
Intangible assets and proprietary technology, net of amortization $722,426 and $162,562 | 1,517,025 | 2,286,345 |
Goodwill | 4,043,486 | 4,076,505 |
Assets held for sale | 289,585 | |
TOTAL ASSETS | 7,066,342 | 7,249,750 |
Current Liabilities | ||
Accounts payable and accrued liabilities | 819,162 | 717,469 |
Note payable, net of discounts of $2,687 and $0 | 146,152 | 85,000 |
Current portion of note payable -related party | 776,806 | 868,361 |
Current portion of convertible notes payable, net of discounts of $303,447 and $148,069 | 2,215,852 | 1,934,932 |
Investor payable - common shares | 658,000 | 658,000 |
Preferred shares payable | 13,438 | |
Contingent consideration | 1,000,000 | 1,000,000 |
Due to related parties | 288,873 | 27,942 |
Other current liabilities | 12,482 | |
Derivative liabilities | 890,267 | 620,237 |
Total Current Liabilities | 6,807,594 | 5,925,379 |
Long-Term Liabilities | ||
Convertible note payable, net of discounts of $42,850 and $56,358 | 2,650 | 10,307 |
Note payable -related party, less current portion | 388,889 | |
TOTAL LIABILITIES | 6,810,244 | 6,324,575 |
Convertible Preferred stock, value | 14,100,000 | 14,000,000 |
Stockholders' Deficit | ||
Common stock, $0.001 par value, 1,400,000,000 shares authorized; 875,634,685 and 261,863,258 shares issued and outstanding, respectively | 875,634 | 261,863 |
Additional paid-in capital | 1,809,835 | 670,962 |
Accumulated deficit | (16,597,560) | (14,057,651) |
Total Stockholders' Deficit | (13,843,902) | (13,074,825) |
TOTAL LIABILITIES AND STOCKHOLDERS' DEFICIT | 7,066,342 | 7,249,750 |
Series C Convertible Preferred stock | ||
Long-Term Liabilities | ||
Convertible Preferred stock, value | 14,000,000 | 14,000,000 |
Series D Convertible Preferred stock | ||
Long-Term Liabilities | ||
Convertible Preferred stock, value | 100,000 | |
Series A Preferred stock | ||
Stockholders' Deficit | ||
Preferred stock, value | 1 | 1 |
Series B Convertable Preferred stock | ||
Stockholders' Deficit | ||
Preferred stock, value | $ 68,188 | $ 50,000 |
CONSOLIDATED BALANCE SHEETS (U3
CONSOLIDATED BALANCE SHEETS (Unaudited) (Parentheticals) - USD ($) | Oct. 31, 2016 | Jan. 31, 2016 |
Depreciation of equipment | $ 0 | $ 73,740 |
Accumulated amortization on intangible assets (in dollars) | 722,426 | 162,562 |
Discount on notes payable (in dollars) | 2,687 | 0 |
Discount on convertible note payable (in dollars) | 303,447 | 148,069 |
Discount on convertible note payable, non current portion (in dollars) | $ 42,850 | $ 56,358 |
Preferred stock, par value (in dollars per share) | $ 0.001 | $ 0.001 |
Preferred stock, shares authorized | 100,000,000 | 100,000,000 |
Common stock, par value (in dollars per share) | $ 0.001 | $ 0.001 |
Common stock, shares authorized | 1,400,000,000 | 1,400,000,000 |
Common stock, shares issued | 875,634,685 | 261,863,258 |
Common stock, shares outstanding | 875,634,685 | 261,863,258 |
Series C Convertible Preferred stock | ||
Convertible Preferred stock, par value (in dollars per share) | $ 0.001 | $ 0.001 |
Convertible Preferred stock, shares authorized | 100 | 100 |
Convertible Preferred stock, shares issued | 14 | 14 |
Convertible Preferred stock, shares outstanding | 14 | 14 |
Series D Convertible Preferred stock | ||
Convertible Preferred stock, par value (in dollars per share) | $ 0.001 | $ 0.001 |
Convertible Preferred stock, shares authorized | 1,000 | 1,000 |
Convertible Preferred stock, shares issued | 1 | 0 |
Convertible Preferred stock, shares outstanding | 1 | 0 |
Series A Preferred stock | ||
Preferred stock, par value (in dollars per share) | $ 0.001 | $ 0.001 |
Preferred stock, shares authorized | 1,000 | 1,000 |
Preferred stock, shares issued | 1,000 | 1,000 |
Preferred stock, shares outstanding | 1,000 | 1,000 |
Series B Convertable Preferred stock | ||
Preferred stock, par value (in dollars per share) | $ 0.001 | $ 0.001 |
Preferred stock, shares authorized | 95,000,000 | 95,000,000 |
Preferred stock, shares issued | 68,187,500 | 50,000,000 |
Preferred stock, shares outstanding | 68,187,500 | 50,000,000 |
CONSOLIDATED STATEMENTS OF OPER
CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME (LOSS) (Unaudited) - USD ($) | 3 Months Ended | 9 Months Ended | ||
Oct. 31, 2016 | Oct. 31, 2015 | Oct. 31, 2016 | Oct. 31, 2015 | |
Consolidated Statements of Operations and Comprehensive Income (Loss) [Abstract] | ||||
Revenue | $ 1,811,716 | $ 526,761 | $ 4,591,798 | $ 1,143,422 |
Cost of revenue | 1,221,442 | 332,704 | 3,210,305 | 725,333 |
Gross profit | 590,274 | 194,057 | 1,381,493 | 418,089 |
Operating expenses | ||||
Stock-based compensation | 160,755 | 309,000 | 398,912 | 366,083 |
General and administration | 583,977 | 307,247 | 1,667,489 | 820,439 |
Accounts payable forgiven | (250,000) | (250,000) | ||
Research and development | 2,500 | |||
Depreciation and amortization | 231,292 | 93,278 | 693,876 | 238,053 |
Total operating expenses | 726,024 | 709,525 | 2,510,277 | 1,427,075 |
Net loss from operations | (135,750) | (515,468) | (1,128,784) | (1,008,986) |
Other income (expense) | ||||
Other income | 6,372 | 16,658 | ||
Interest expense, net | (96,894) | (56,665) | (435,009) | (146,868) |
Amortization of debt discount and deferred financing fees | (269,046) | (105,203) | (835,664) | (284,303) |
Unrealized gain (loss) on marketable securities | 67,200 | (52,500) | 84,600 | 128,550 |
Change in fair value of derivative liabilities | (149,358) | (36,268) | (250,987) | (36,268) |
Gain on settlement of debt | 9,277 | 9,277 | ||
Total other expense | (432,449) | (250,636) | (1,411,125) | (338,889) |
Net loss | (568,199) | (766,104) | (2,539,909) | (1,347,875) |
Other comprehensive income | 442 | |||
Comprehensive Loss | $ (568,199) | $ (766,104) | $ (2,539,909) | $ (1,347,433) |
Basic and dilutive loss per common share (in dollars per share) | $ 0 | $ 0 | $ (0.01) | $ (0.01) |
Weighted average number of common shares outstanding (in shares) | 648,943,956 | 196,682,424 | 446,743,266 | 182,828,588 |
CONSOLIDATED STATEMENTS OF CASH
CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited) - USD ($) | 9 Months Ended | |
Oct. 31, 2016 | Oct. 31, 2015 | |
CASH FLOWS FROM OPERATING ACTIVITIES: | ||
Net loss | $ (2,539,909) | $ (1,347,875) |
Adjustments to reconcile net loss to net cash used in operating activities: | ||
Common stock issued for services | 150,083 | |
Common stock options issued for services | 177,000 | |
Common stock issued for legal settlement | 54,000 | |
Stock-based compensation | 221,913 | 216,000 |
Amortization of debt discount and deferred financing fees | 835,664 | 284,303 |
Unrealized gain on marketable securities | (84,600) | (128,550) |
Depreciation and amortization | 693,876 | 238,053 |
Expense for conversion of debt | 8,540 | |
Accounts payable forgiven | (250,000) | |
Change in fair value of derivative liabilities | 250,987 | 36,268 |
Gain on settlement of debt | (9,277) | |
(Increase) decrease in operating assets: | ||
Accounts receivable | (170,800) | (7,115) |
Prepaid expenses and other assets | (2,565) | |
Increase (decrease) in operating liabilities: | ||
Accounts payable and accrued liabilities | 402,215 | 138,330 |
Due to related parties | 260,931 | 38,620 |
Other current liabilities | 3,962 | |
Net Cash Used In Operating Activities | (210,603) | (319,343) |
CASH FLOWS FROM INVESTING ACTIVITIES: | ||
Acquisition of XTELUS, net of cash acquired | 397 | |
Net cash paid for acquisition of Net D's assets | (138,250) | |
Net Cash Provided by (Used in) Investing Activities | 397 | (138,250) |
CASH FLOWS FROM FINANCING ACTIVITIES: | ||
Proceeds from notes payable | 147,050 | 25,000 |
Proceeds from convertible notes, net of original issue discounts and deferred financing fees | 691,733 | 191,000 |
Proceeds from notes payable - related party | 25,000 | |
Payment of notes payable - related party | (505,444) | |
Payment of convertible notes payable | (33,333) | |
Payment of notes payable | (11,161) | |
Proceeds from issuance of Series B Preferred stock | 20,000 | 17,500 |
Proceeds from issuance of common stock | 5,000 | |
Net Cash Provided By Financing Activities | 333,845 | 238,500 |
Effect of exchange rate changes | 442 | |
Net decrease in cash and cash equivalents | 123,639 | (218,651) |
Cash and cash equivalents, beginning of period | 64,944 | 255,455 |
Cash and cash equivalents, end of period | 188,583 | 36,804 |
Supplemental cash flow information | ||
Cash paid for interest | 242,902 | |
Cash paid for taxes | ||
Non-cash financing transactions: | ||
Acquisition of XTELUS through issuance of preferred shares | 100,000 | |
Series B Preferred shares issued to settle preferred share payable | 13,438 | |
Preferred share payable for preferred C stock | 1,000,000 | |
Acquisition of goodwill | 3,554,622 | |
Issuance of preferred shares payable for acquisition | 2,000,000 | |
Issuance of investor payable for acquisition | 1,556,000 | |
Issuance of common stock for conversion of debt and accrued interest | 509,353 | 64,030 |
Common stock issued in exchange for warrants | 41,000 | 206,000 |
Intangible assets assumed from acquisition | 363,128 | |
Accounts payable assumed from acquisition | 11,750 | |
Debt discount from derivative liability | 848,172 | 166,500 |
Note payable assumed from acquisition | 350,000 | |
Reclassification of derivative liability from additional paid in capital due to tainted instruments | 586,250 | |
Derivative resolution | 1,006,129 | $ 122,588 |
Accrued interest added to principal | 1,159 | |
Convertible note issued for prepayment penalty | 31,438 | |
Replacement of note payable to Convertible note | 75,000 | |
Reclassification of assets as held for sale | $ 289,585 |
DESCRIPTION OF BUSINESS
DESCRIPTION OF BUSINESS | 9 Months Ended |
Oct. 31, 2016 | |
Description of Business [Abstract] | |
DESCRIPTION OF BUSINESS | NOTE 1 - DESCRIPTION OF BUSINESS Gawk Incorporated (“we”, “our”, the “Company”) was incorporated in the state of Nevada on January 6, 2011 with principal business address at 5300 Melrose Avenue, Suite 42, Los Angeles, CA. The Company offers a suite of cloud communications, cloud connectivity, cloud computing, and managed cloud-based applications solutions to small, medium, and large businesses; and offers domestic and international voice services to communications carriers worldwide. It offers a suite of advanced data center and cloud-based services, including fault tolerant, high availability cloud servers, which comprise platform as a service, infrastructure as a service, and a content delivery network; managed network services that converge voice and data applications, structured cabling, wireless, and security services, as well as include Internet access via Ethernet or fiber at speeds ranging from 10 Mbps to 10 Gbps; and data center solutions, including cloud services, colocation services, and business continuity services, such as storage and security. Our website is located at www.gawkinc.com |
BASIS OF PRESENTATION OF INTERI
BASIS OF PRESENTATION OF INTERIM FINANCIAL STATEMENTS | 9 Months Ended |
Oct. 31, 2016 | |
Basis of Presentation of Interim Financial Statements [Abstract] | |
BASIS OF PRESENTATION OF INTERIM FINANCIAL STATEMENTS | NOTE 2 - BASIS OF PRESENTATION OF INTERIM FINANCIAL STATEMENTS Basis of Presentation of Interim Financial Statements The accompanying interim unaudited consolidated financial statements have been prepared in accordance with generally accepted accounting principles for interim financial information and in accordance with the instructions to Form 10-Q and Article 8 of Regulation S-X. In the opinion of management, all adjustments (consisting of normal recurring adjustments) considered necessary for a fair presentation have been included. Operating results for the three and nine months ended October 31, 2016 are not necessarily indicative of the results that may be expected for the year ending January 31, 2017. Notes to the unaudited interim consolidated financial statements that would substantially duplicate the disclosures contained in the audited consolidated financial statements for fiscal year 2016 have been omitted. This report should be read in conjunction with the audited consolidated financial statements and the footnotes thereto for the fiscal year ended January 31, 2016 included in the Company’s Form 10-K as filed with the Securities and Exchange Commission on May 24, 2016. Use of Estimates and Assumptions The preparation of financial statements in conformity with accounting principles generally accepted in the United States ("GAAP") requires management to make estimates and assumptions that affect (i) the reported amounts of assets and liabilities, (ii) the disclosure of contingent assets and liabilities known to exist as of the date the financial statements are published, and (iii) the reported amount of net revenues and expenses recognized during the periods presented. Adjustments made with respect to the use of estimates often relate to improved information not previously available. Uncertainties with respect to such estimates and assumptions are inherent in the preparation of financial statements; accordingly, actual results could differ from these estimates. Reclassifications Certain amounts in the fiscal 2016 financial statements have been reclassified to conform to the fiscal 2017 presentation. Revenue Recognition The Company pursues opportunities to realize revenues from consulting services. It is the company’s policy that revenues and gains will be recognized in accordance with ASC Topic 605-10-25, “Revenue Recognition.” Our Business Services revenue includes monthly recurring charges (“MRC”) to customers, for whom charges are contracted over a specified period of time, and variable usage fees charged to customers that purchase our business products and services. Revenue recognition commences after the provisioning, testing and acceptance of the service by the customer. MRCs continue until the expiration of the contract, or until cancellation of the service by the customer. To the extent that payments received from a customer are related to a future period, the payment is recorded as deferred revenue until the service is provided or the usage occurs. Our Carrier Services revenue is primarily derived from usage fees charged to other carriers that terminate voice traffic over our network. Variable revenue is earned based on the length of a call, as measured by the number of minutes of duration. It is recognized upon completion of the call, and is adjusted to reflect the allowance for billing adjustments. Revenue for each customer is calculated from information received through our network switches. Our customized software tracks the information from the switches and analyzes the call detail records against stored detailed information about revenue rates. This software provides us with the ability to complete a timely and accurate analysis of revenue earned in a period. We believe that the nature of this process is such that recorded revenues are unlikely to be revised in future periods. Fair Value of Financial Instruments The Company's financial instruments consist primarily of cash, accounts receivable, accounts payable and accrued liabilities, and debt. The carrying amounts of such financial instruments approximate their respective estimated fair value due to the short-term maturities and approximate market interest rates of these instruments. The Company adopted ASC Topic 820, “ Fair Value Measurements The three-level hierarchy for fair value measurements is defined as follows: · Level 1 - inputs to the valuation methodology are quoted prices (unadjusted) for identical assets or liabilities in active markets; liabilities in active markets; · Level 2 - inputs to the valuation methodology include quoted prices for similar assets and liabilities in active markets, and inputs that are observable for the asset or liability other than quoted prices, either directly or indirectly, including inputs in markets that are not considered to be active; or directly or indirectly including inputs in markets that are not considered to be active; · Level 3 - inputs to the valuation methodology are unobservable and significant to the fair value measurement The following table summarizes fair value measurements by level at October 31, 2016 and January 31, 2016 measured at fair value on a recurring basis: Carrying Value at October 31, 2016 October 31, 2016 Level 1 Level 2 Level 3 Total Marketable securities- available for sale 162,900 - - 162,900 Total assets 162,900 - - 162,900 Derivative liabilities - - 890,267 890,267 Total liabilities - - 890,267 890,267 Carrying Value at January 31, 2016 January 31, 2016 Level 1 Level 2 Level 3 Total Marketable securities- available for sale 78,300 - - 78,300 Total assets 78,300 - - 78,300 Derivative liabilities - - 620,237 620,237 Total liabilities - - 620,237 620,237 Recent Accounting Pronouncements No accounting standards or interpretations issued recently are expected to a have a material impact on the Company's financial position, operations or cash flows. |
GOING CONCERN
GOING CONCERN | 9 Months Ended |
Oct. 31, 2016 | |
Going Concern Issues [Abstract] | |
GOING CONCERN | NOTE 3 - GOING CONCERN The accompanying financial statements have been prepared in conformity with accounting principles generally accepted in the United States of America, which contemplate continuation of the Company as a going concern. However, the Company has a net loss for the nine months ended October 31, 2016 of $2,539,909, an accumulated deficit of $16,597,560, cash flows used in operating activities of $210,603 and needs additional cash to maintain its operations. These factors raise substantial doubt about the Company's ability to continue as a going concern. The accompanying financial statements do not include any adjustments that might result from the outcome of this uncertainty. The Company's continued existence is dependent upon management's ability to develop profitable operations, continued contributions from the Company's executive officers to finance its operations and the ability to obtain additional funding sources to explore potential strategic relationships and to provide capital and other resources for the further development and marketing of the Company's products and business. |
ACQUISITION
ACQUISITION | 9 Months Ended |
Oct. 31, 2016 | |
Business Combinations [Abstract] | |
ACQUISITION | NOTE 4 - ACQUISITION On June 27, 2016, the Company entered into an acquisition agreement with NEOGEN Holdings LLC, whereby the Company acquired 100% of the membership interest of XTELUS LLC and XETLUS S.A. (“XTELUS”). The acquisition of XTELUS met the definition of a business in accordance with FASB ASC Topic 805, "Business Combinations". Management determined that the Company was the acquirer in the business combination in accordance with FASB ASC Topic 805, "Business Combinations," The purchase price paid for the acquisition of XTELUS amounted to $100,000 and consisted of 1 Series D Preferred Stock, which is convertible into $100,000 of common shares at any time following 12 months from the issuance of such shares. The following table summarizes the fair value of the consideration paid by the Company and the fair value amounts assigned to the assets acquired on the acquisition date: Fair Value of Consideration: June 26, 1 share of Series D Preferred Shares $ 100,000 Total Purchase Price $ 100,000 Assets and Liabilites: June 26, Current assets $ 51,374 Current liabilities (29,260 ) Goodwill 77,886 Fair value of total assets $ 100,000 Revenues of $498,035 and net loss of $51,376 since the acquisition date are included in the consolidated statements of operations and comprehensive income (loss) for the nine months ended October 31, 2016. Unaudited proforma results of operations for the nine months ended October 31, 2016 and 2015 as though the Company acquired XTELUS on the first day of each period are set forth below: Nine months ended October 31, 2016 2015 Revenues $ 5,008,007 $ 1,293,174 Cost of revenues 3,530,143 857,044 Gross profit 1,477,864 436,130 Operating expenses 2,680,809 1,428,672 Operating loss (1,202,945 ) (992,542 ) Other expense (1,411,125 ) (338,889 ) Net Loss $ (2,614,070 ) $ (1,331,431 ) |
NOTES PAYABLE
NOTES PAYABLE | 9 Months Ended |
Oct. 31, 2016 | |
Convertible Notes Payable and Notes Payable [Abstract] | |
NOTES PAYABLE | NOTE 5 - NOTES PAYABLE The Company had the following notes payable and notes payable - related party outstanding as of October 31, 2016 and January 31, 2016: Notes Payable October 31, January, 31, Dated – October 30, 2014 $ 10,000 $ 10,000 Dated – June 3, 2015 - 25,000 Dated – December 11, 2015 - 50,000 Dated – August 4, 2016 25,000 - Dated – September 30, 2016 113,839 - Total notes payable $ 148,839 $ 85,000 Less: debt discount and deferred financing fees (2,687 ) - 146,152 85,000 Less: current portion of notes payable 146,152 85,000 Long-term portion of notes payable - - The Company recognized amortization expense related to the debt discount and deferred financing fees of $263 and $0 for the nine months ended October 31, 2016 and 2015, respectively. Dated - October 30, 2014 On October 30, 2014, the Company exercised the comprehensive acquisition agreement of Webrunner, LLC (“Webrunner”) and in the acquisition the Company assumed the debt of RNC Media in the amount of $10,000. The Note does not have any interest payable and is due upon demand. Dated - June 3, 2015, December 11, 2015 The two notes were issued to Mr. Doyle Knudson, are subject to annual interest of 15% and are convertible into a total of 863,000 common shares. The note issued on June 3, 2015 matured in December 2015. On August 4, 2016, the Company entered into the new agreement with Crossover Capital Fund I, LLC, which the Company issued a new convertible note of $75,000 for the payment of the two notes of $75,000. As a result of this agreement, the Company recognized gain on debt settlement of $9,277. Dated – August 4, 2016 The note was issued to Mr. Doyle Knudson, are subject to annual interest of 15% and are convertible into 250,000 common shares. The note matured in February 2017. Dated – September 30, 2016 The Company entered into the revenue based factoring agreement with Powerup Lending Group, Ltd. and received cash of $125,000. The note includes an original issue discount and financing fee of $2,950 and the Company received cash of $122,050. The Company is required to make weekly principal and interest payments of $4,560 for a period of 34 weeks through May 30, 2017. Notes Payable - related party October 31, January, 31, Dated – April 23, 2015 $ 221,250 $ 282,250 Dated - January 18, 2016 555,556 975,000 Total notes payable 776,806 1,257,250 Less: current portion of notes payable 776,806 868,361 Long-term notes payable $ - $ 388,889 Dated - April 23, 2015 On May 1, 2015, in connection with the acquisition of the assets of Net D Consulting, Inc. (“Net D”), the Company issued a $350,000 note which bears no interest and matures on October 7, 2016. The Company made repayments on the note of $61,000 during the nine months ended October 31, 2016. Dated - January 18, 2016 On January 18, 2016, in connection with the acquisition of Connexum, the Company issued a $1,000,000 note to Net D which bears annual interest of 18%. The Company is required to make monthly principal and interest payments of $63,806 for a period of 18 months through August 1, 2017. The Company paid principal and interest payments of $444,444 for the nine months ended October 31, 2016. |
CONVERTIBLE NOTES PAYABLE
CONVERTIBLE NOTES PAYABLE | 9 Months Ended |
Oct. 31, 2016 | |
Convertible Notes Payable and Notes Payable [Abstract] | |
CONVERTIBLE NOTES PAYABLE | NOTE 6 - CONVERTIBLE NOTES PAYABLE The Company had the following convertible notes payable outstanding as of October 31, 2016 and January 31, 2016: October 31, January, 31, Promissory Note - Issued August 22, 2014, with a fixed conversion price of $0.10 per common share or 17,000,000 shares of common stock. $ 1,700,000 $ 1,700,000 Promissory notes – Issued in fiscal year 2016, with variable conversion features. 114,444 449,666 Promissory notes – Issued in fiscal year 2017, with variable conversion features. 750,355 - Total convertible notes payable 2,564,799 2,149,666 Less: debt discount and deferred financing fees (346,297 ) (204,427 ) 2,218,502 1,945,239 Less: current portion of convertible notes payable 2,215,852 1,934,932 Long-term convertible notes payable $ 2,650 $ 10,307 The Company recognized amortization expense related to the debt discount and deferred financing fees of $835,401 and $284,303 for the nine months ended October 31, 2016 and 2015, respectively. Promissory Note - August 22, 2014 In connection with the settlement agreement entered into with Doyle Knudson, an investor, in 2014, the Company issued a $1.8 million convertible promissory note with a fixed conversion price of $0.10 per share or 17,000,000 shares of common stock. The note is subject to annual interest of 10%, matured in August 2015 and is currently past due. In May and December 2015, a total of $100,000 note principal was transferred to another lender. Due to the variable conversion rates in the other convertible notes (see below), the $1,700,000 balance of the note became tainted and the embedded fixed conversion option was bifurcated and accounted for as a derivative liability. The Company recorded a discount on the convertible note due to a beneficial conversion feature of $358,200 and amortized $0 and $208,950 for the nine months ended October 31, 2016 and 2015, respectively. Promissory Notes - Issued in fiscal year 2016 During the year ended January 31, 2016, the Company issued a total of $449,666 notes with the following terms: · Terms ranging from 9 months to 2 years · Annual interest rates ranging from 5% to 12% · Convertible at the option of the holders either at issuance or 180 days from issuance. The note dated September 29, 2015 is convertible at the later of the maturity date or date of default. · Conversion prices are typically based on the discounted (50% to 60% discount) lowest trading prices of the Company’s shares during various periods prior to conversion. Certain notes allow for the conversion price to be the lower of $0.01 or the discounted trading price Certain notes allow the Company to redeem the notes at rates ranging from 118% to 148% depending on the redemption date provided that no redemption is allowed after the 180 th The Company determined that the conversion feature met the definition of a liability in accordance with ASC Topic No. 815 - 40, Derivatives and Hedging - Contracts in Entity's Own Stock and therefore bifurcated the embedded conversion option once the note becomes convertible and accounted for it as a derivative liability. The fair value of the conversion feature was recorded as a debt discount and amortized to interest expense over the term of the note. The Company valued the conversion feature using the Black Scholes valuation model. The fair value of the derivative liability for all the notes that became convertible during the year amounted to $459,733. $250,733 of the value assigned to the derivative liability was recognized as a debt discount to the notes while the balance of $209,000 was recognized as a “day 1” derivative loss. During the nine months ended October 31, 2016, the fair value of the derivative liability for all the notes that became convertible amounted to $327,870. $219,500 of the value assigned to the derivative liability was recognized as a debt discount to the notes while the balance of $108,370 was recognized as a “day 1” derivative loss. During the nine months ended October 31, 2016, the Company repaid notes with principal amounts totaling to $33,333 and converted notes with principal amounts of $303,048 and accrued interest of $21,692 into 150,793,678 shares of common stock. The corresponding derivative liability at the date of conversion of $553,477 was credited to additional paid in capital. During the nine months ended October 31, 2016, the Company assigned 10 notes with principal amounts totaling to $375,750 to one lender which resulted to the payment of prepayment penalties amounting to $142,672. Promissory Notes - Issued in fiscal year 2017 During the nine months ended October 31, 2016, the Company issued a total of $927,272 notes with the following terms: · Terms ranging from 9 months to 20 months · Annual interest rates ranging from 8% to 12% · Convertible at the option of the holders either at issuance or 180 days from issuance. · Conversion prices are typically based on the discounted (50% discount) lowest trading prices of the Company’s shares during various periods prior to conversion. Certain notes allow for the conversion price to be a floor of $0.0005 and $0.00005 per share. Certain notes allow the Company to redeem the notes at rates ranging from 118% to 150% depending on the redemption date provided that no redemption is allowed after the 180 th The Company determined that the conversion feature met the definition of a liability in accordance with ASC Topic No. 815 - 40, Derivatives and Hedging - Contracts in Entity's Own Stock and therefore bifurcated the embedded conversion option once the note becomes convertible and accounted for it as a derivative liability. The fair value of the conversion feature was recorded as a debt discount and amortized to interest expense over the term of the note. The Company valued the conversion feature using the Black Scholes valuation model. The fair value of the derivative liability for all the notes that became convertible during the nine months ended October 31, 2016 amounted to $1,299,291. $628,672 of the value assigned to the derivative liability was recognized as a debt discount to the notes while the balance of $670,619 was recognized as a “day 1” derivative loss. During the nine months ended October 31, 2016, the Company converted notes with principal amounts of $176,918 and accrued interest of $7,695 into 421,977,749 shares of common stock. The corresponding derivative liability at the date of conversion of $314,434 was credited to additional paid in capital. |
DERIVATIVE LIABILITIES
DERIVATIVE LIABILITIES | 9 Months Ended |
Oct. 31, 2016 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
DERIVATIVE LIABILITIES | NOTE 7 - DERIVATIVE LIABILITIES The Company analyzed the conversion option for derivative accounting consideration under ASC 815, Derivatives and Hedging, and hedging, and determined that the instrument should be classified as a liability since the conversion option becomes effective at issuance resulting in there being no explicit limit to the number of shares to be delivered upon settlement of the above conversion options. ASC 815 requires we assess the fair market value of derivative liability at the end of each reporting period and recognize any change in the fair market value as other income or expense item. The Company determined our derivative liabilities to be a Level 3 fair value measurement and used the Black-Scholes pricing model to calculate the fair value as of October 31, 2016. The Black-Scholes model requires six basic data inputs: the exercise or strike price, time to expiration, the risk free interest rate, the current stock price, the estimated volatility of the stock price in the future, and the dividend rate. Changes to these inputs could produce a significantly higher or lower fair value measurement. The fair value of each convertible note is estimated using the Black-Scholes valuation model. The following weighted-average assumptions were used in the October 31, 2016 and January 31, 2016 valuations: Nine Months Year October 31, January 31, Expected term 0.008 - 1.50 years 0.4 - 2 years Expected average volatility 120% - 381 % 249% - 328 % Expected dividend yield - 0 Risk-free interest rate 0.00% - 0.67 % 0.05% - 0.83 % At October 31, 2016, the estimated fair values of the liabilities measured on a recurring basis are as follows: October 31, 2016 Level 1 Level 2 Level 3 Total Promissory Note – Issued August 22, 2014 $ - $ - $ 6,800 $ 6,800 Promissory Notes – Issued in fiscal year 2016 - - 137,737 137,737 Promissory Notes – Issued in fiscal year 2017 - - 745,620 745,620 Warrants -Issued in fiscal year 2016 - - 110 110 Warrants -Issued in fiscal year 2017 - - - - Total liabilities $ - $ - $ 890,267 $ 890,267 Fair Value Measurements Using Significant Observable Inputs (Level 3) Balance - January 31, 2016 $ 620,237 Addition of new derivatives recognized as debt discounts 848,172 Addition of new derivatives recognized as options compensation 177,000 Addition of new derivatives recognized as loss on derivatives 778,989 Derivatives settled upon conversion of debt and exercise of warrants (1,006,129 ) Loss on change in fair value of the derivative (528,002 ) Balance - October 31, 2016 $ 890,267 The net loss on derivatives during the nine months ended October 31, 2016 and 2015 was $250,987 and $36,268, respectively. |
EQUITY
EQUITY | 9 Months Ended |
Oct. 31, 2016 | |
Equity [Abstract] | |
EQUITY | NOTE 8 - EQUITY Preferred Stock Series A Preferred Stock There were no issuances of the Series A Preferred Stock during the nine months ended October 31, 2016 Series B Convertible Preferred Stock During the nine months ended October 31, 2016, the Company issued Series B Preferred shares, as follows: · On December 21, 2015, the Company recorded preferred stock payable of $13,438 for 13,437,500 Series B Preferred shares related to the acquisition of the assets of Net D. During the nine months ended October 31, 2016 the Company issued 13,437,500 Series B Preferred shares to settle this payable. · On February 3, 2016, 4,750,000 shares were sold for cash of $20,000. On issuance, value of the underlining common stock represented a beneficial conversion feature of $23,344. The beneficial conversion feature will be recognized when the preferred stock becomes convertible on August 3, 2016 as a deemed dividend. Series C Convertible Preferred Stock There were no issuances of the Series C Preferred Stock during the nine months ended October 31, 2016. Series D Convertible Preferred Stock On June 23, 2016, pursuant to its Articles of Incorporation and Bylaws, the Board of Directors of the Company, unanimously approved the designation of a new series of preferred stock, "Series D Convertible Preferred Stock. Each share of the Series D Preferred Stock shall be convertible, at the option of the holder thereof and subject to notice requirements at any time following 12 months from the issuance of such shares, into such number of fully paid and non-assessable common shares worth $100,000. During nine months ended October 31, 2016, the Company issued 1 share of Series D Preferred Stock with a fair value of $100,000 in connection with the acquisition of XTELUS (see Note 4). As of October 31, 2016 and January 31, 2016, 1 and 0 shares of Series D Preferred Stock were issued and outstanding, respectively. Common stock During the nine months ended October 31, 2016, the Company issued common shares, as follows: · 572,771,427 common shares were issued for the conversion of debt and accrued interest of $509,352. · 41,000,000 common shares in exchange for the exercise of options for no consideration Warrants and Options Options During nine months ended October 31, 2016, the Company entered into three separate agreements with consultants to provide the Company with consulting services in exchange for options of 17,000,000, 5,000,000 and 17,000,000 with an exercise price of $0, respectively. The options can be exercised by the holder any time prior to June 30, August 31, and September 30, 2016. These options were tainted as a result of the convertible notes with variable conversion rates (see Note 7) and were accounted for as derivative instruments at the time of issuance. The fair value of the options amounting to $177,000 was recorded as stock compensation expense during the nine months ended October 31, 2016, with a corresponding credit to derivative liability (see Note 7). A summary of activity during the period ended October 31, 2016 follows: Options Outstanding Weighted Average Shares Exercise Price Outstanding, January 31, 2016 36,100,000 $ 0.03 Granted 39,000,000 $ - Exercised (41,000,000 ) $ (0.0009 ) Forfeited/expired (5,000,000 ) $ - Outstanding, October 31, 2016 29,100,000 $ 0.03 The following table summarizes information relating to outstanding and exercisable stock options as of October 31, 2016: Options Outstanding Options Exercisable Number of Weighted Average Remaining Contractual life (in years) Weighted Average Number of Weighted Average 9,100,000 3.00 $ 0.10 9,100,000 $ 0.10 20,000,000 0.08 $ 0.005 20,000,000 $ 0.005 29,100,000 1.00 $ 0.03 29,100,000 $ 0.03 The options have an intrinsic value at October 31, 2016 and January 31, 2016 of $0 and $59,400, respectively. Employee Incentive Bonus Plan On June 27, 2016, the Company entered into employee agreement with two employees that contain preferred share issuance incentive bonuses based on various sales targets for XTELUS, for the 12- month period ending June 27, 2017. The first award contains cash compensation of $10,000 per month and the ability to earn 500,000 shares of Series B preferred stock if XTELUS revenue of $1,000,000 is generated within 12 months. The second award contains cash compensation of $20,000 per month, 5 shares of Series D preferred stock earned on June 27, 2017 (with 1 share earned immediately upon revenue of $100,000 being generated within first six months) and the ability to earn up to 6,500,000 shares of Series B preferred stock based upon XTELUS revenue targets up to $1,000,000 over 12 months and up to an additional 3,000,000 shares of Series B preferred stock based upon XTELUS revenue targets up between $1,000,000 and greater than $7,000,000 over 12 months. The Company assessed the probability that the revenue targets will be met and determined that the target revenue will most likely meet $1,000,000 and based on the stock awards, estimated the fair value of 6,500,000 shares of Preferred B stock at $32,500, 5 shares of Preferred D stock at $500,000 and 500,000 shares of Preferred B stock at $2,500, respectively. For the period ended October 31, 2016, the Company recognized stock based compensation of $221,912 under these awards, with a corresponding credit to additional paid in capital. |
RELATED PARTY TRANSACTIONS
RELATED PARTY TRANSACTIONS | 9 Months Ended |
Oct. 31, 2016 | |
Related Party Transactions [Abstract] | |
RELATED PARTY TRANSACTIONS | NOTE 9 - RELATED PARTY TRANSACTIONS As of October 31, 2016 and January 31, 2016, the CEO had accrued salaries of $98,000 and $0, respectively. During the nine months ended October 31, 2016 and 2015, the CEO advanced the Company cash of $200 and $0, respectively. As of October 31, 2016 and January 31, 2016, the amount owed to the CEO for advances was $200 and $0, respectively. As of October 31, 2016, the Company has outstanding notes payable to Net D totaling to $776,806 in connection with the Company’s acquisition of Connexum and certain assets of Net D. The sole owner of Net D is a director and officer of the Company. Net D also performs certain services for the Company in connection with the latter’s Carrier Services business. During the period ended October 31, 2016, the Company incurred total fees in connection with such services of $58,784. As of October 31, 2016 and January 31, 2016, the Company owed related parties $288,873 and $27,942, respectively. |
COMMITMENTS AND CONTINGENCIES
COMMITMENTS AND CONTINGENCIES | 9 Months Ended |
Oct. 31, 2016 | |
Commitments and Contingencies Disclosure [Abstract] | |
COMMITMENTS AND CONTINGENCIES | NOTE 10 - COMMITMENTS AND CONTINGENCIES Licensing Agreement / Deposit On June 11, 2014, we entered into a license and subscription agreement with Cloud Medical Doctor Software Corporation formerly National Scientific Corporation (NSCT) which changed its name to Cipher Loc Corporation and ticker symbol to (CLOK) ("Cloud") for $1,125,000. The agreement grants to us a non-exclusive encryption license agreement which entitles us to utilize Cloud's encryption software solution within the Customer's business. We purchased a 48 months encryption licensing agreement to incorporate into our existing web based software. The licensing agreement will protect members of our platform from hackers and other privacy intrusion vehicles. CipherLoc has various features that will further protect our members and end users of our web developed platform. During the year ended January 31, 2016, the Company wrote off 50% of the deposit amounting to $562,500 to impairment expense. As of October 31, 2016, the software has not been delivered to the Company and the remaining amount of $562,500 continues to be reported as a deposit in the consolidated balance sheet. Contingency Connexum, LLC. On January 18, 2016, the Company entered into an acquisition agreement with Net D, whereby the Company acquired 100% of the membership interest of Connexum, LLC (“Connexum”). The agreement also provided for contingent consideration of 1 Series C Preferred share convertible into $1,000,000 common shares if Connexum achieves 80% of anticipated revenue and another 1 Series C Preferred share convertible into $1,000,000 common shares if Connexum achieves 100% of anticipated revenue within one year from the date of acquisition. The Company determined that Connexum will meet 80% of the anticipated revenue and has recognized the fair value of the contingent consideration of $1,000,000 both as of October 31, 2016 and January 31, 2016. Windstream Holdings, Inc. At the time of acquisition of Connexum, Windstream Holdings, Inc. ("Windstream"), a provider of voice and data network communications, and managed services, to businesses in the United States, claimed that Connexum owed them $600,000, which charges Connexum denies. In 2015, Connexum contracted with Windstream to purchase high cost long distance services. When receiving the initial invoices Connexum noticed the bill was not what was expected and issued a dispute for the incorrect charges and paid the non-disputed amount of just over $20,000. Then, without notice, Windstream turned off services. Shortly thereafter Windstream and Connexum disputed over high cost traffic. Windstream continued to bill Connexum for many months even after disconnecting its service, which ended up totaling nearly $580,000 of disputed fees. At the time of disconnection, there was approximately $20,000 in actual unpaid usage fees. It is unlikely that the Company would pay these fees. Windstream has not threatened litigation at this point and Connexum is actively working to settle the disputed amount. On May 25, 2016, the Company reached a settlement with Windstream for $20,000. As of the filing of this report, the Company paid the $20,000. Tarpon Bay Partners LLC On May 26, 2016, Tarpon Bay Partners, LLC (“Tarpon Bay”) initiated action against the Company in New York State Supreme Court, case #652178/2016. Tarpon Bay has elected for summary judgment in lieu of complaint. Tarpon Bay is claiming, inter alia, that the Company owes $93,500 in unpaid notes and services. The claims stems from intended transactions the Company was to enter with Tarpon Bay. Tarpon Bay was to provide the Company with funding and certain services in exchange for promissory notes from the Company. The notes were executed by the Company, but Tarpon Bay provided no funding or services and is not entitled to repayment of any note given by the Company. The Company intends to vehemently defend the foregoing action. |
ASSETS HELD FOR SALE
ASSETS HELD FOR SALE | 9 Months Ended |
Oct. 31, 2016 | |
Assets Held For Sale [Abstract] | |
ASSETS HELD FOR SALE | NOTE 12 – ASSETS HELD FOR SALE On October 31, 2016, the Company entered into the asset purchase and sale agreement (the “Agreement”) with Giggle Fiber, LLC. Pursuant to the terms of the Agreement, the Company sold the equipment and customer list of Webrunner for $400,000, payable in instalments. As title will not transfer until payments are made we are classifying these assets as held for sale as of October 31, 2016. The following table summarizes the carrying amounts of the assets held for sale; October 31, Assets held for sale 2016 Equipment, net of depreciation of $117,984 $ 58,991 Intangible assets, net of amortization $239,378 119,689 Goodwill 110,905 Total assets held for sale $ 289,585 |
ACCOUNTS PAYABLE FORGIVEN
ACCOUNTS PAYABLE FORGIVEN | 9 Months Ended |
Oct. 31, 2016 | |
Accounts Payable and Accrued Liabilities [Abstract] | |
ACCOUNTS PAYABLE FORGIVEN | NOTE 13 – ACCOUNTS PAYABLE FORGIVEN During the period ended October 31, 2016, a vendor forgave accounts payable owing of $250,000. The Company recorded the amount to operating expenses on the Statement of Operations. |
SUBSEQUENT EVENT
SUBSEQUENT EVENT | 9 Months Ended |
Oct. 31, 2016 | |
Subsequent Events [Abstract] | |
SUBSEQUENT EVENT | NOTE 14 - SUBSEQUENT EVENT Subsequent to October 31, 2016, the Company sold the equipment and customer list of Webrunner for $400,000 (see Note 12). Subsequent to October 31, 2016, the Company issued common shares as follows; · 405,106,884 shares of common stock for the conversion of debt and accrued interest of $51,379. |
BASIS OF PRESENTATION OF INTE19
BASIS OF PRESENTATION OF INTERIM FINANCIAL STATEMENTS (Policies) | 9 Months Ended |
Oct. 31, 2016 | |
Basis of Presentation of Interim Financial Statements [Abstract] | |
Basis of Presentation of Interim Financial Statements | Basis of Presentation of Interim Financial Statements The accompanying interim unaudited consolidated financial statements have been prepared in accordance with generally accepted accounting principles for interim financial information and in accordance with the instructions to Form 10-Q and Article 8 of Regulation S-X. In the opinion of management, all adjustments (consisting of normal recurring adjustments) considered necessary for a fair presentation have been included. Operating results for the three and nine months ended October 31, 2016 are not necessarily indicative of the results that may be expected for the year ending January 31, 2017. Notes to the unaudited interim consolidated financial statements that would substantially duplicate the disclosures contained in the audited consolidated financial statements for fiscal year 2016 have been omitted. This report should be read in conjunction with the audited consolidated financial statements and the footnotes thereto for the fiscal year ended January 31, 2016 included in the Company’s Form 10-K as filed with the Securities and Exchange Commission on May 24, 2016. |
Use of Estimates and Assumptions | Use of Estimates and Assumptions The preparation of financial statements in conformity with accounting principles generally accepted in the United States ("GAAP") requires management to make estimates and assumptions that affect (i) the reported amounts of assets and liabilities, (ii) the disclosure of contingent assets and liabilities known to exist as of the date the financial statements are published, and (iii) the reported amount of net revenues and expenses recognized during the periods presented. Adjustments made with respect to the use of estimates often relate to improved information not previously available. Uncertainties with respect to such estimates and assumptions are inherent in the preparation of financial statements; accordingly, actual results could differ from these estimates. |
Reclassifications | Reclassifications Certain amounts in the fiscal 2016 financial statements have been reclassified to conform to the fiscal 2017 presentation. |
Revenue Recognition | Revenue Recognition The Company pursues opportunities to realize revenues from consulting services. It is the company’s policy that revenues and gains will be recognized in accordance with ASC Topic 605-10-25, “Revenue Recognition.” Our Business Services revenue includes monthly recurring charges (“MRC”) to customers, for whom charges are contracted over a specified period of time, and variable usage fees charged to customers that purchase our business products and services. Revenue recognition commences after the provisioning, testing and acceptance of the service by the customer. MRCs continue until the expiration of the contract, or until cancellation of the service by the customer. To the extent that payments received from a customer are related to a future period, the payment is recorded as deferred revenue until the service is provided or the usage occurs. Our Carrier Services revenue is primarily derived from usage fees charged to other carriers that terminate voice traffic over our network. Variable revenue is earned based on the length of a call, as measured by the number of minutes of duration. It is recognized upon completion of the call, and is adjusted to reflect the allowance for billing adjustments. Revenue for each customer is calculated from information received through our network switches. Our customized software tracks the information from the switches and analyzes the call detail records against stored detailed information about revenue rates. This software provides us with the ability to complete a timely and accurate analysis of revenue earned in a period. We believe that the nature of this process is such that recorded revenues are unlikely to be revised in future periods. |
Fair Value of Financial Instruments | Fair Value of Financial Instruments The Company's financial instruments consist primarily of cash, accounts receivable, accounts payable and accrued liabilities, and debt. The carrying amounts of such financial instruments approximate their respective estimated fair value due to the short-term maturities and approximate market interest rates of these instruments. The Company adopted ASC Topic 820, “ Fair Value Measurements The three-level hierarchy for fair value measurements is defined as follows: · Level 1 - inputs to the valuation methodology are quoted prices (unadjusted) for identical assets or liabilities in active markets; liabilities in active markets; · Level 2 - inputs to the valuation methodology include quoted prices for similar assets and liabilities in active markets, and inputs that are observable for the asset or liability other than quoted prices, either directly or indirectly, including inputs in markets that are not considered to be active; or directly or indirectly including inputs in markets that are not considered to be active; · Level 3 - inputs to the valuation methodology are unobservable and significant to the fair value measurement The following table summarizes fair value measurements by level at October 31, 2016 and January 31, 2016 measured at fair value on a recurring basis: Carrying Value at October 31, 2016 October 31, 2016 Level 1 Level 2 Level 3 Total Marketable securities- available for sale 162,900 - - 162,900 Total assets 162,900 - - 162,900 Derivative liabilities - - 890,267 890,267 Total liabilities - - 890,267 890,267 Carrying Value at January 31, 2016 January 31, 2016 Level 1 Level 2 Level 3 Total Marketable securities- available for sale 78,300 - - 78,300 Total assets 78,300 - - 78,300 Derivative liabilities - - 620,237 620,237 Total liabilities - - 620,237 620,237 |
Recent Accounting Pronouncements | Recent Accounting Pronouncements No accounting standards or interpretations issued recently are expected to a have a material impact on the Company's financial position, operations or cash flows. |
BASIS OF PRESENTATION OF INTE20
BASIS OF PRESENTATION OF INTERIM FINANCIAL STATEMENTS (Tables) | 9 Months Ended |
Oct. 31, 2016 | |
Basis of Presentation of Interim Financial Statements [Abstract] | |
Schedule of summary of fair value measured on recurring basis | October 31, 2016 Level 1 Level 2 Level 3 Total Marketable securities- available for sale 162,900 - - 162,900 Total assets 162,900 - - 162,900 Derivative liabilities - - 890,267 890,267 Total liabilities - - 890,267 890,267 January 31, 2016 Level 1 Level 2 Level 3 Total Marketable securities- available for sale 78,300 - - 78,300 Total assets 78,300 - - 78,300 Derivative liabilities - - 620,237 620,237 Total liabilities - - 620,237 620,237 |
ACQUISITION (Tables)
ACQUISITION (Tables) | 9 Months Ended |
Oct. 31, 2016 | |
Business Combinations [Abstract] | |
Schedule of fair value of contingent consideration | Fair Value of Consideration: June 26, 1 share of Series D Preferred Shares $ 100,000 Total Purchase Price $ 100,000 Assets and Liabilites: June 26, Current assets $ 51,374 Current liabilities (29,260 ) Goodwill 77,886 Fair value of total assets $ 100,000 |
Schedule of proforma results of operations | Nine months ended October 31, 2016 2015 Revenues $ 5,008,007 $ 1,293,174 Cost of revenues 3,530,143 857,044 Gross profit 1,477,864 436,130 Operating expenses 2,680,809 1,428,672 Operating loss (1,202,945 ) (992,542 ) Other expense (1,411,125 ) (338,889 ) Net Loss $ (2,614,070 ) $ (1,331,431 ) |
NOTES PAYABLE (Tables)
NOTES PAYABLE (Tables) | 9 Months Ended |
Oct. 31, 2016 | |
Convertible Notes Payable and Notes Payable [Abstract] | |
Schedule of summary of notes payable | October 31, January, 31, Dated – October 30, 2014 $ 10,000 $ 10,000 Dated – June 3, 2015 - 25,000 Dated – December 11, 2015 - 50,000 Dated – August 4, 2016 25,000 - Dated – September 30, 2016 113,839 - Total notes payable $ 148,839 $ 85,000 Less: debt discount and deferred financing fees (2,687 ) - 146,152 85,000 Less: current portion of notes payable 146,152 85,000 Long-term portion of notes payable - - |
Schedule of note payable related party | October 31, January, 31, Dated – April 23, 2015 $ 221,250 $ 282,250 Dated - January 18, 2016 555,556 975,000 Total notes payable 776,806 1,257,250 Less: current portion of notes payable 776,806 868,361 Long-term notes payable $ - $ 388,889 |
CONVERTIBLE NOTES PAYABLE (Tabl
CONVERTIBLE NOTES PAYABLE (Tables) | 9 Months Ended |
Oct. 31, 2016 | |
Convertible Notes Payable and Notes Payable [Abstract] | |
Schedule of convertible notes payable | October 31, January, 31, Promissory Note - Issued August 22, 2014, with a fixed conversion price of $0.10 per common share or 17,000,000 shares of common stock. $ 1,700,000 $ 1,700,000 Promissory notes – Issued in fiscal year 2016, with variable conversion features. 114,444 449,666 Promissory notes – Issued in fiscal year 2017, with variable conversion features. 750,355 - Total convertible notes payable 2,564,799 2,149,666 Less: debt discount and deferred financing fees (346,297 ) (204,427 ) 2,218,502 1,945,239 Less: current portion of convertible notes payable 2,215,852 1,934,932 Long-term convertible notes payable $ 2,650 $ 10,307 |
DERIVATIVE LIABILITIES (Tables)
DERIVATIVE LIABILITIES (Tables) | 9 Months Ended |
Oct. 31, 2016 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
Schedule of weighted-average assumptions used in Black-Scholes valuation model | Nine Months Year October 31, January 31, Expected term 0.008 - 1.50 years 0.4 - 2 years Expected average volatility 120% - 381 % 249% - 328 % Expected dividend yield - 0 Risk-free interest rate 0.00% - 0.67 % 0.05% - 0.83 % |
Schedule of estimated fair values of liabilities measured on a recurring basis | October 31, 2016 Level 1 Level 2 Level 3 Total Promissory Note – Issued August 22, 2014 $ - $ - $ 6,800 $ 6,800 Promissory Notes – Issued in fiscal year 2016 - - 137,737 137,737 Promissory Notes – Issued in fiscal year 2017 - - 745,620 745,620 Warrants -Issued in fiscal year 2016 - - 110 110 Warrants -Issued in fiscal year 2017 - - - - Total liabilities $ - $ - $ 890,267 $ 890,267 |
Schedule of changes in derivative liabilities | Fair Value Measurements Using Significant Observable Inputs (Level 3) Balance - January 31, 2016 $ 620,237 Addition of new derivatives recognized as debt discounts 848,172 Addition of new derivatives recognized as options compensation 177,000 Addition of new derivatives recognized as loss on derivatives 778,989 Derivatives settled upon conversion of debt and exercise of warrants (1,006,129 ) Loss on change in fair value of the derivative (528,002 ) Balance - October 31, 2016 $ 890,267 |
EQUITY (Tables)
EQUITY (Tables) | 9 Months Ended |
Oct. 31, 2016 | |
Equity [Abstract] | |
Schedule of summary of stock options activity | Options Outstanding Weighted Average Shares Exercise Price Outstanding, January 31, 2016 36,100,000 $ 0.03 Granted 39,000,000 $ - Exercised (41,000,000 ) $ (0.0009 ) Forfeited/expired (5,000,000 ) $ - Outstanding, October 31, 2016 29,100,000 $ 0.03 |
Schedule of outstanding and exercisable stock options activity | Options Outstanding Options Exercisable Number of Weighted Average Remaining Contractual life (in years) Weighted Average Number of Weighted Average 9,100,000 3.00 $ 0.10 9,100,000 $ 0.10 20,000,000 0.08 $ 0.005 20,000,000 $ 0.005 29,100,000 1.00 $ 0.03 29,100,000 $ 0.03 |
ASSETS HELD FOR SALE (Tables)
ASSETS HELD FOR SALE (Tables) | 9 Months Ended |
Oct. 31, 2016 | |
Assets Held For Sale [Abstract] | |
Disclosure of carrying amounts of the assets held for sale | October 31, Assets held for sale 2016 Equipment, net of depreciation of $117,984 $ 58,991 Intangible assets, net of amortization $239,378 119,689 Goodwill 110,905 Total assets held for sale $ 289,585 |
BASIS OF PRESENTATION OF INTE27
BASIS OF PRESENTATION OF INTERIM FINANCIAL STATEMENTS (Details) - USD ($) | Oct. 31, 2016 | Jan. 31, 2016 |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Marketable securities - available for sale | $ 162,900 | $ 78,300 |
Recurring basis | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Marketable securities - available for sale | 162,900 | 78,300 |
Total assets | 162,900 | 78,300 |
Derivative liabilities | 890,267 | 620,237 |
Total liabilities | 890,267 | 620,237 |
Recurring basis | Level 1 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Marketable securities - available for sale | 162,900 | 78,300 |
Total assets | 162,900 | 78,300 |
Derivative liabilities | ||
Total liabilities | ||
Recurring basis | Level 2 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Marketable securities - available for sale | ||
Total assets | ||
Derivative liabilities | ||
Total liabilities | ||
Recurring basis | Level 3 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Marketable securities - available for sale | ||
Total assets | ||
Derivative liabilities | 890,267 | 620,237 |
Total liabilities | $ 890,267 | $ 620,237 |
GOING CONCERN (Detail Textuals)
GOING CONCERN (Detail Textuals) - USD ($) | 3 Months Ended | 9 Months Ended | |||
Oct. 31, 2016 | Oct. 31, 2015 | Oct. 31, 2016 | Oct. 31, 2015 | Jan. 31, 2016 | |
Going Concern Issues [Abstract] | |||||
Net loss | $ (568,199) | $ (766,104) | $ (2,539,909) | $ (1,347,875) | |
Accumulated deficit | $ (16,597,560) | (16,597,560) | $ (14,057,651) | ||
Cash flows used in operating activities | $ (210,603) | $ (319,343) |
ACQUISITION (Details)
ACQUISITION (Details) - USD ($) | 1 Months Ended | ||
Jun. 26, 2016 | Oct. 31, 2016 | Jan. 31, 2016 | |
Assets and Liabilities: | |||
Goodwill | $ 4,043,486 | $ 4,076,505 | |
Xtelus | |||
Fair Value of Consideration: | |||
1 share of Series D Preferred Shares | $ 100,000 | ||
Total Purchase Price | 100,000 | ||
Assets and Liabilities: | |||
Current assets | 51,374 | ||
Current liabilities | (29,260) | ||
Goodwill | 77,886 | ||
Fair value of total assets | $ 100,000 |
ACQUISITION (Details) (Parenthe
ACQUISITION (Details) (Parentheticals) | 1 Months Ended |
Jun. 26, 2016shares | |
Xtelus | Series D Convertible Preferred stock | |
Business Acquisition [Line Items] | |
Number of preferred stock converted | 1 |
ACQUISITION (Details 1)
ACQUISITION (Details 1) - Xtelus - USD ($) | 9 Months Ended | |
Oct. 31, 2016 | Oct. 31, 2015 | |
Business Acquisition, Pro Forma Information, Nonrecurring Adjustment [Line Items] | ||
Revenues | $ 5,008,007 | $ 1,293,174 |
Cost of revenues | 3,530,143 | 857,044 |
Gross profit | 1,477,864 | 436,130 |
Operating expenses | 2,680,809 | 1,428,672 |
Operating loss | (1,202,945) | (992,542) |
Other expense | (1,411,125) | (338,889) |
Net Loss | $ (2,614,070) | $ (1,331,431) |
ACQUISITION (Detail Textuals)
ACQUISITION (Detail Textuals) - USD ($) | 1 Months Ended | 3 Months Ended | 9 Months Ended | |||
Jun. 26, 2016 | Oct. 31, 2016 | Oct. 31, 2015 | Oct. 31, 2016 | Oct. 31, 2015 | Jun. 27, 2016 | |
Business Acquisition [Line Items] | ||||||
Revenue | $ 1,811,716 | $ 526,761 | $ 4,591,798 | $ 1,143,422 | ||
Net loss | $ (568,199) | $ (766,104) | (2,539,909) | $ (1,347,875) | ||
Xtelus | ||||||
Business Acquisition [Line Items] | ||||||
Percentage of voting interests acquired | 100.00% | |||||
Total purchase price | $ 100,000 | |||||
Revenue | 498,035 | |||||
Net loss | $ 51,376 | |||||
Xtelus | Series D Convertible Preferred stock | ||||||
Business Acquisition [Line Items] | ||||||
Total purchase price | $ 100,000 | |||||
Number of preferred stock converted | 1 | |||||
Common shares in exchange for the exercise of options | 100,000 |
NOTES PAYABLE (Details)
NOTES PAYABLE (Details) - USD ($) | Oct. 31, 2016 | Jan. 31, 2016 |
Short-term Debt [Line Items] | ||
Total notes payable | $ 148,839 | $ 85,000 |
Less: debt discount and deferred financing fees | (2,687) | 0 |
Notes payable net of debt discount and deferred financing fees | 146,152 | 85,000 |
Less: current portion of notes payable | 146,152 | 85,000 |
Long-term portion of notes payable | ||
Dated - October 30, 2014 | ||
Short-term Debt [Line Items] | ||
Total notes payable | 10,000 | 10,000 |
Dated - June 3, 2015 | ||
Short-term Debt [Line Items] | ||
Total notes payable | 25,000 | |
Dated - December 11, 2015 | ||
Short-term Debt [Line Items] | ||
Total notes payable | 50,000 | |
Dated - August 4, 2016 | ||
Short-term Debt [Line Items] | ||
Total notes payable | 25,000 | |
Dated - September 30, 2016 | ||
Short-term Debt [Line Items] | ||
Total notes payable | $ 113,839 |
NOTES PAYABLE (Details 1)
NOTES PAYABLE (Details 1) - USD ($) | Oct. 31, 2016 | Jan. 31, 2016 |
Short-term Debt [Line Items] | ||
Total notes payable | $ 148,839 | $ 85,000 |
Less: current portion of notes payable | 146,152 | 85,000 |
Long-term portion of notes payable | ||
Note Payable related party | ||
Short-term Debt [Line Items] | ||
Total notes payable | 776,806 | 1,257,250 |
Less: current portion of notes payable | 776,806 | 868,361 |
Long-term portion of notes payable | 388,889 | |
Dated - April 23, 2015 | Note Payable related party | ||
Short-term Debt [Line Items] | ||
Total notes payable | 221,250 | 282,250 |
Dated - January 18, 2016 | Note Payable related party | ||
Short-term Debt [Line Items] | ||
Total notes payable | $ 555,556 | $ 975,000 |
NOTES PAYABLE (Detail Textuals)
NOTES PAYABLE (Detail Textuals) | Aug. 04, 2016USD ($)Notes | Jan. 18, 2016USD ($) | Oct. 31, 2016USD ($) | Oct. 31, 2016USD ($)Notesshares | Oct. 31, 2015USD ($) | Jan. 31, 2016USD ($) | May 01, 2015USD ($) |
Short-term Debt [Line Items] | |||||||
Amortization expense related to the debt discount and deferred financing fees | $ 263 | $ 0 | |||||
Note payable | $ 148,839 | 148,839 | $ 85,000 | ||||
Repayment of notes payable | $ 11,161 | ||||||
Number of convertible common shares | shares | 405,106,884 | ||||||
Gain on settlement of debt | 9,277 | $ 9,277 | |||||
Less: notes discount and financing fee | (2,687) | (2,687) | 0 | ||||
Net cash received from notes payable | 147,050 | $ 25,000 | |||||
Dated - October 30, 2014 | |||||||
Short-term Debt [Line Items] | |||||||
Note payable | 10,000 | 10,000 | 10,000 | ||||
Dated - September 30, 2016 | |||||||
Short-term Debt [Line Items] | |||||||
Note payable | $ 113,839 | $ 113,839 | |||||
Mr. Doyle Knudson | Dated - June 3, 2015 and December 11, 2015 | |||||||
Short-term Debt [Line Items] | |||||||
Interest rate per annum | 15.00% | 15.00% | |||||
Number of convertible common shares | shares | 863,000 | ||||||
Number of notes payable | Notes | 2 | ||||||
Mr. Doyle Knudson | Dated - August 4, 2016 | |||||||
Short-term Debt [Line Items] | |||||||
Interest rate per annum | 15.00% | 15.00% | |||||
Number of convertible common shares | shares | 250,000 | ||||||
Crossover Capital Fund I, LLC | Dated - June 3, 2015 and December 11, 2015 | |||||||
Short-term Debt [Line Items] | |||||||
Repayment of notes payable | $ 75,000 | ||||||
Principal amount of note agreement | $ 75,000 | ||||||
Number of notes payable | Notes | 2 | ||||||
Gain on settlement of debt | $ 9,277 | ||||||
Powerup Lending Group, Ltd. | Dated - September 30, 2016 | |||||||
Short-term Debt [Line Items] | |||||||
Principal and interest payment | $ 4,560 | ||||||
Term period of installment | 238 days | ||||||
Notes payable cash received | $ 125,000 | $ 125,000 | |||||
Less: notes discount and financing fee | $ 2,950 | 2,950 | |||||
Net cash received from notes payable | 122,050 | ||||||
Net D Consulting, Inc. ("Net D") | Asset purchase and sale agreement | Dated - April 23, 2015 | |||||||
Short-term Debt [Line Items] | |||||||
Note payable | $ 350,000 | ||||||
Repayment of notes payable | 61,000 | ||||||
Net D Consulting, Inc. ("Net D") | Purchase Of Connexum | Dated - January 18, 2016 | |||||||
Short-term Debt [Line Items] | |||||||
Principal amount of note agreement | $ 1,000,000 | ||||||
Interest rate per annum | 18.00% | ||||||
Principal and interest payment | $ 63,806 | $ 444,444 | |||||
Term period of installment | 18 months |
CONVERTIBLE NOTES PAYABLE (Deta
CONVERTIBLE NOTES PAYABLE (Details) - USD ($) | Oct. 31, 2016 | Jan. 31, 2016 |
Short-term Debt [Line Items] | ||
Total convertible notes payable | $ 2,564,799 | $ 2,149,666 |
Less: debt discount and deferred financing fees | (346,297) | (204,427) |
Convertible notes payable net of debt discount and deferred financing fees | 2,218,502 | 1,945,239 |
Less: current portion of convertible notes payable | 2,215,852 | 1,934,932 |
Long-term convertible notes payable | 2,650 | 10,307 |
Promissory Note - Issued August 22, 2014 | ||
Short-term Debt [Line Items] | ||
Total convertible notes payable | 1,700,000 | 1,700,000 |
Promissory Notes - Issued in fiscal year 2016 | ||
Short-term Debt [Line Items] | ||
Total convertible notes payable | 114,444 | 449,666 |
Promissory Notes - Issued in fiscal year 2017 | ||
Short-term Debt [Line Items] | ||
Total convertible notes payable | $ 750,355 |
CONVERTIBLE NOTES PAYABLE (De37
CONVERTIBLE NOTES PAYABLE (Details) (Parentheticals) - Dated - August 22, 2014 - Mr. Doyle Knudson - Convertible Promissory Note | Aug. 22, 2014USD ($)$ / shares |
Short-term Debt [Line Items] | |
Notes payable outstanding | $ | $ 17,000,000 |
Conversion price | $ / shares | $ 0.10 |
CONVERTIBLE NOTES PAYABLE (De38
CONVERTIBLE NOTES PAYABLE (Detail Textuals) - USD ($) | 3 Months Ended | 9 Months Ended | ||||
Oct. 31, 2016 | Oct. 31, 2015 | Oct. 31, 2016 | Oct. 31, 2015 | Jan. 31, 2016 | Aug. 22, 2014 | |
Short-term Debt [Line Items] | ||||||
Amortization of debt discount and deferred financing fees | $ 269,046 | $ 105,203 | $ 835,664 | $ 284,303 | ||
Convertible notes payable | 2,564,799 | 2,564,799 | $ 2,149,666 | |||
Dated - August 22, 2014 | Mr. Doyle Knudson | Convertible Promissory Note | ||||||
Short-term Debt [Line Items] | ||||||
Amortization of debt discount and deferred financing fees | 0 | $ 208,950 | ||||
Convertible notes payable | $ 1,800,000 | |||||
Conversion price | $ 0.10 | |||||
Notes payable outstanding | $ 17,000,000 | |||||
Interest rate per annum | 10.00% | |||||
Beneficial conversion feature | 358,200 | |||||
Convertible notes payable | $ 1,700,000 | $ 1,700,000 | ||||
Dated - May and December 2015 | Convertible Promissory Note | ||||||
Short-term Debt [Line Items] | ||||||
Convertible notes payable | $ 100,000 |
CONVERTIBLE NOTES PAYABLE (De39
CONVERTIBLE NOTES PAYABLE (Detail Textuals 1) | 9 Months Ended | 12 Months Ended | |
Oct. 31, 2016USD ($)Notes$ / sharesshares | Oct. 31, 2015USD ($) | Jan. 31, 2016USD ($)$ / shares | |
Short-term Debt [Line Items] | |||
Payment of convertible notes payable | $ 33,333 | ||
Number of common shares issued under debt conversion | shares | 405,106,884 | ||
Derivative resolution | $ 1,006,129 | $ 122,588 | |
Debt discount on convertible debenture | 303,447 | $ 148,069 | |
Issued In Fiscal Year 2016 | |||
Short-term Debt [Line Items] | |||
Convertible notes payable | $ 375,750 | ||
Number of convertible notes issued to an unrelated party | Notes | 10 | ||
Penalty for prepayment of convertible notes | $ 142,672 | ||
Issued In Fiscal Year 2016 | Convertible Promissory Note | |||
Short-term Debt [Line Items] | |||
Convertible notes payable | 303,048 | 449,666 | |
Derivative liabilities | 553,477 | 459,733 | |
Derivative loss | 108,370 | 209,000 | |
Amount of original issuance discount | 24,166 | ||
Deferred financing costs | $ 55,142 | ||
Payment of convertible notes payable | 33,333 | ||
Accrued interest | $ 21,692 | ||
Number of common shares issued under debt conversion | shares | 150,793,678 | ||
Conversion price | $ / shares | $ 0.01 | ||
Fair value of derivative liability | $ 327,870 | ||
Debt discount on convertible debenture | 219,500 | $ 250,733 | |
Issued In Fiscal Year 2016 | Convertible Promissory Note | Minimum | |||
Short-term Debt [Line Items] | |||
Interest rate per annum | 5.00% | ||
Convertible notes payable, term | P9M | ||
Convertible notes payable redemption percentage | 118.00% | ||
Discounted conversion price | 50.00% | ||
Issued In Fiscal Year 2016 | Convertible Promissory Note | Maximum | |||
Short-term Debt [Line Items] | |||
Interest rate per annum | 12.00% | ||
Convertible notes payable, term | P2Y | ||
Convertible notes payable redemption percentage | 148.00% | ||
Discounted conversion price | 60.00% | ||
Issued In Fiscal Year 2017 | |||
Short-term Debt [Line Items] | |||
Convertible notes payable | 176,918 | ||
Derivative liabilities | 314,434 | ||
Accrued interest | $ 7,695 | ||
Number of common shares issued under debt conversion | shares | 421,977,749 | ||
Issued In Fiscal Year 2017 | Convertible Promissory Note | |||
Short-term Debt [Line Items] | |||
Convertible notes payable | $ 927,272 | ||
Derivative loss | 670,619 | ||
Amount of original issuance discount | 70,476 | ||
Deferred financing costs | $ 58,625 | ||
Discounted conversion price | 50.00% | ||
Fair value of derivative liability | $ 1,299,291 | ||
Debt discount on convertible debenture | 628,672 | ||
Deferred financing cash received | $ 691,733 | ||
Issued In Fiscal Year 2017 | Convertible Promissory Note | Minimum | |||
Short-term Debt [Line Items] | |||
Interest rate per annum | 8.00% | ||
Convertible notes payable, term | P9M | ||
Convertible notes payable redemption percentage | 118.00% | ||
Conversion price | $ / shares | $ 0.00005 | ||
Issued In Fiscal Year 2017 | Convertible Promissory Note | Maximum | |||
Short-term Debt [Line Items] | |||
Interest rate per annum | 12.00% | ||
Convertible notes payable, term | P20M | ||
Convertible notes payable redemption percentage | 150.00% | ||
Conversion price | $ / shares | $ 0.0005 |
DERIVATIVE LIABILITIES (Details
DERIVATIVE LIABILITIES (Details) | 9 Months Ended | 12 Months Ended |
Oct. 31, 2016 | Jan. 31, 2016 | |
Minimum | ||
Derivative [Line Items] | ||
Expected term | 3 days | 4 months 24 days |
Expected average volatility | 120.00% | 249.00% |
Expected dividend yield | 0.00% | |
Risk-free interest rate | 0.00% | 0.05% |
Maximum | ||
Derivative [Line Items] | ||
Expected term | 1 year 6 months | 2 years |
Expected average volatility | 381.00% | 328.00% |
Expected dividend yield | 0.00% | |
Risk-free interest rate | 0.67% | 0.83% |
DERIVATIVE LIABILITIES (Detai41
DERIVATIVE LIABILITIES (Details 1) - Recurring basis - USD ($) | Oct. 31, 2016 | Jan. 31, 2016 |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Derivative liability | $ 890,267 | $ 620,237 |
Promissory Note - Issued August 22, 2014 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Derivative liability | 6,800 | |
Promissory Notes - Issued in fiscal year 2016 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Derivative liability | 137,737 | |
Promissory Notes - Issued in fiscal year 2017 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Derivative liability | 745,620 | |
Warrants -Issued in fiscal year 2016 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Derivative liability | 110 | |
Warrants -Issued in fiscal year 2017 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Derivative liability | ||
Level 1 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Derivative liability | ||
Level 1 | Promissory Note - Issued August 22, 2014 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Derivative liability | ||
Level 1 | Promissory Notes - Issued in fiscal year 2016 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Derivative liability | ||
Level 1 | Promissory Notes - Issued in fiscal year 2017 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Derivative liability | ||
Level 1 | Warrants -Issued in fiscal year 2016 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Derivative liability | ||
Level 1 | Warrants -Issued in fiscal year 2017 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Derivative liability | ||
Level 2 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Derivative liability | ||
Level 2 | Promissory Note - Issued August 22, 2014 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Derivative liability | ||
Level 2 | Promissory Notes - Issued in fiscal year 2016 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Derivative liability | ||
Level 2 | Promissory Notes - Issued in fiscal year 2017 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Derivative liability | ||
Level 2 | Warrants -Issued in fiscal year 2016 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Derivative liability | ||
Level 2 | Warrants -Issued in fiscal year 2017 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Derivative liability | ||
Level 3 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Derivative liability | 890,267 | $ 620,237 |
Level 3 | Promissory Note - Issued August 22, 2014 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Derivative liability | 6,800 | |
Level 3 | Promissory Notes - Issued in fiscal year 2016 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Derivative liability | 137,737 | |
Level 3 | Promissory Notes - Issued in fiscal year 2017 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Derivative liability | 745,620 | |
Level 3 | Warrants -Issued in fiscal year 2016 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Derivative liability | 110 | |
Level 3 | Warrants -Issued in fiscal year 2017 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Derivative liability |
DERIVATIVE LIABILITIES (Detai42
DERIVATIVE LIABILITIES (Details 2) | 9 Months Ended |
Oct. 31, 2016USD ($) | |
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward] | |
Balance - January 31, 2016 | $ 620,237 |
Addition of new derivatives recognized as debt discounts | 848,172 |
Addition of new derivatives recognized as options compensation | 177,000 |
Addition of new derivatives recognized as loss on derivatives | 778,989 |
Derivatives settled upon conversion of debt and exercise of warrants | (1,006,129) |
Loss on change in fair value of the derivative | (528,002) |
Balance - October 31, 2016 | $ 890,267 |
DERIVATIVE LIABILITIES (Detail
DERIVATIVE LIABILITIES (Detail Textuals) - USD ($) | 3 Months Ended | 9 Months Ended | ||
Oct. 31, 2016 | Oct. 31, 2015 | Oct. 31, 2016 | Oct. 31, 2015 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | ||||
Net loss on derivatives | $ (149,358) | $ (36,268) | $ (250,987) | $ (36,268) |
EQUITY (Details)
EQUITY (Details) - Stock Option | 9 Months Ended |
Oct. 31, 2016$ / sharesshares | |
Options Outstanding, Shares | |
Outstanding, January 31, 2016 | shares | 36,100,000 |
Granted | shares | 39,000,000 |
Exercised | shares | (41,000,000) |
Forfeited/expired | shares | (5,000,000) |
Outstanding, October 31, 2016 | shares | 29,100,000 |
Options Outstanding, Weighted Average Exercise Price | |
Outstanding, January 31, 2016 | $ / shares | $ 0.03 |
Granted | $ / shares | |
Exercised | $ / shares | (0.0009) |
Forfeited/expired | $ / shares | |
Outstanding, October 31, 2016 | $ / shares | $ 0.03 |
EQUITY (Details 1)
EQUITY (Details 1) | 9 Months Ended |
Oct. 31, 2016$ / sharesshares | |
0.10 | |
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range [Line Items] | |
Options Outstanding, Number of Shares | shares | 9,100,000 |
Options Outstanding, Weighted Average Remaining Contractual life (in years) | 3 years |
Options Outstanding, Weighted Average Exercise Price | $ / shares | $ 0.10 |
Options Exercisable, Number of Shares | shares | 9,100,000 |
Options Exercisable, Weighted Average Exercise Price | $ / shares | $ 0.10 |
0.005 | |
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range [Line Items] | |
Options Outstanding, Number of Shares | shares | 20,000,000 |
Options Outstanding, Weighted Average Remaining Contractual life (in years) | 29 days |
Options Outstanding, Weighted Average Exercise Price | $ / shares | $ 0.005 |
Options Exercisable, Number of Shares | shares | 20,000,000 |
Options Exercisable, Weighted Average Exercise Price | $ / shares | $ 0.005 |
0.03 | |
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range [Line Items] | |
Options Outstanding, Number of Shares | shares | 29,100,000 |
Options Outstanding, Weighted Average Remaining Contractual life (in years) | 1 year |
Options Outstanding, Weighted Average Exercise Price | $ / shares | $ 0.03 |
Options Exercisable, Number of Shares | shares | 29,100,000 |
Options Exercisable, Weighted Average Exercise Price | $ / shares | $ 0.03 |
EQUITY (Detail Textuals)
EQUITY (Detail Textuals) - USD ($) | Feb. 03, 2016 | Jun. 26, 2016 | Dec. 21, 2015 | Oct. 31, 2016 | Jun. 23, 2016 | Jan. 31, 2016 |
Equity [Line Items] | ||||||
Number of convertible common shares | 405,106,884 | |||||
Intrinsic value of options | $ 0 | $ 59,400 | ||||
Xtelus | ||||||
Equity [Line Items] | ||||||
Fair value of preferred stock | $ 100,000 | |||||
Series B Convertable Preferred stock | ||||||
Equity [Line Items] | ||||||
Preferred stock payable | $ 13,438 | |||||
Number of common shares issued as purchase consideration | 13,437,500 | 13,437,500 | ||||
Stock issued, amount | $ 20,000 | |||||
Number of convertible common shares | 4,750,000 | |||||
Beneficial conversion feature | $ 23,344 | |||||
Series D Preferred Stock | ||||||
Equity [Line Items] | ||||||
Convertible debt issued | $ 100,000 | |||||
Convertible Preferred stock, shares issued | 1 | 0 | ||||
Convertible Preferred stock, shares outstanding | 1 | 0 | ||||
Series D Preferred Stock | Xtelus | ||||||
Equity [Line Items] | ||||||
Number of common shares issued as purchase consideration | 1 | |||||
Fair value of preferred stock | $ 100,000 |
EQUITY (Detail Textuals 1)
EQUITY (Detail Textuals 1) - USD ($) | 9 Months Ended | |
Oct. 31, 2016 | Jan. 31, 2016 | |
Equity [Line Items] | ||
Accrued interest | $ 51,379 | |
Intrinsic value of options | $ 0 | $ 59,400 |
Exercise price 0 | ||
Equity [Line Items] | ||
Number of options issued to consultants | 17,000,000 | |
Exercise price of options | $ 0 | |
Exercise price 0 | ||
Equity [Line Items] | ||
Number of options issued to consultants | 5,000,000 | |
Exercise price of options | $ 0 | |
Exercise price 0 | ||
Equity [Line Items] | ||
Number of options issued to consultants | 17,000,000 | |
Exercise price of options | $ 0 | |
Common Stock | ||
Equity [Line Items] | ||
Common stock issued | 572,771,427 | |
Accrued interest | $ 509,352 | |
Common shares in exchange for the exercise of options | 41,000,000 |
EQUITY (Detail Textuals 2)
EQUITY (Detail Textuals 2) | 1 Months Ended | 9 Months Ended | |
Jun. 27, 2016USD ($)Employeeshares | Oct. 31, 2016USD ($) | Oct. 31, 2015USD ($) | |
Equity [Line Items] | |||
Stock-based compensation | $ 221,913 | $ 216,000 | |
Xtelus | |||
Equity [Line Items] | |||
Revenues generated | 5,008,007 | $ 1,293,174 | |
Employee agreement | Employee Incentive Bonus Plan | |||
Equity [Line Items] | |||
Number of employees | Employee | 2 | ||
Stock-based compensation | $ 221,912 | ||
Employee agreement | Employee Incentive Bonus Plan | First award | |||
Equity [Line Items] | |||
Employee incentive bonus plan description | The first award contains cash compensation of $10,000 per month and the ability to earn 500,000 shares of Series B preferred stock if XTELUS revenue of $1,000,000 is generated within 12 months | ||
Cash compensation awarded per month | $ 10,000 | ||
Employee agreement | Employee Incentive Bonus Plan | First award | Xtelus | |||
Equity [Line Items] | |||
Revenues generated | $ 1,000,000 | ||
Employee agreement | Employee Incentive Bonus Plan | First award | Series B Convertable Preferred stock | |||
Equity [Line Items] | |||
Number of shares earned as part of award | shares | 500,000 | ||
Fair value of shares earned as part of award | $ 2,500 | ||
Employee agreement | Employee Incentive Bonus Plan | Second award | |||
Equity [Line Items] | |||
Employee incentive bonus plan description | The second award contains cash compensation of $20,000 per month, 5 shares of Series D preferred stock earned on June 27, 2017 (with 1 share earned immediately upon revenue of $100,000 being generated within first six months) and the ability to earn up to 6,500,000 shares of Series B preferred stock based upon XTELUS revenue targets up to $1,000,000 over 12 months and up to an additional 3,000,000 shares of Series B preferred stock based upon XTELUS revenue targets up between $1,000,000 and greater than $7,000,000 over 12 months. | ||
Cash compensation awarded per month | $ 20,000 | ||
Employee agreement | Employee Incentive Bonus Plan | Second award | Xtelus | |||
Equity [Line Items] | |||
Revenue generated within first six months | 100,000 | ||
Employee agreement | Employee Incentive Bonus Plan | Second award | Xtelus | Minimum | |||
Equity [Line Items] | |||
Revenues generated | 1,000,000 | ||
Employee agreement | Employee Incentive Bonus Plan | Second award | Xtelus | Maximum | |||
Equity [Line Items] | |||
Revenues generated | $ 7,000,000 | ||
Employee agreement | Employee Incentive Bonus Plan | Second award | Series B Convertable Preferred stock | |||
Equity [Line Items] | |||
Number of shares earned as part of award | shares | 6,500,000 | ||
Fair value of shares earned as part of award | $ 32,500 | ||
Additional number of shares earned as part of award | shares | 3,000,000 | ||
Employee agreement | Employee Incentive Bonus Plan | Second award | Series D Preferred Stock | |||
Equity [Line Items] | |||
Number of shares earned as part of award | shares | 5 | ||
Fair value of shares earned as part of award | $ 500,000 | ||
Number of shares earned immediately upon revenue of generated within first six months | shares | 1 |
RELATED PARTY TRANSACTIONS (Det
RELATED PARTY TRANSACTIONS (Detail Textuals) - USD ($) | 9 Months Ended | ||
Oct. 31, 2016 | Oct. 31, 2015 | Jan. 31, 2016 | |
Related Party Transaction [Line Items] | |||
Note payable | $ 148,839 | $ 85,000 | |
Due to related parties | 288,873 | 27,942 | |
Net D Consulting, Inc. ("Net D") | Connexum, LLC. | |||
Related Party Transaction [Line Items] | |||
Note payable | 776,806 | ||
Total fees for services | 58,784 | ||
CEO | |||
Related Party Transaction [Line Items] | |||
Accrued salaries | 98,000 | 0 | |
Advance fund from CEO | 200 | $ 0 | |
Advance amount owed to CEO | $ 200 | $ 0 |
COMMITMENTS AND CONTINGENCIES (
COMMITMENTS AND CONTINGENCIES (Detail Textuals) - Licensing Agreements - Software - USD ($) | Jun. 11, 2014 | Jan. 31, 2016 | Oct. 31, 2016 |
Commitments And Contingencies [Line Items] | |||
Cost of agreement | $ 1,125,000 | ||
Term of agreement | 48 months | ||
Written down value of software | 50.00% | ||
Impairment expense of intangible assets | $ 562,500 | ||
Security deposit | $ 562,500 |
COMMITMENTS AND CONTINGENCIES51
COMMITMENTS AND CONTINGENCIES (Detail Textuals 1) - USD ($) | 1 Months Ended | 9 Months Ended | |
Jan. 18, 2016 | Oct. 31, 2016 | Jan. 31, 2016 | |
Commitments And Contingencies [Line Items] | |||
Contingent consideration | $ 1,000,000 | $ 1,000,000 | |
Connexum, LLC. | |||
Commitments And Contingencies [Line Items] | |||
Membership interest | 100.00% | ||
Percentage of anticipated revenues achieved | 80.00% | ||
Connexum, LLC. | Series C Preferred stock | 80% of anticipated revenue | |||
Commitments And Contingencies [Line Items] | |||
Common stock issued after conversion | $ 1,000,000 | ||
Connexum, LLC. | Series C Preferred stock | 100% of anticipated revenue | |||
Commitments And Contingencies [Line Items] | |||
Common stock issued after conversion | $ 1,000,000 |
COMMITMENTS AND CONTINGENCIES52
COMMITMENTS AND CONTINGENCIES (Detail Textuals 2) - USD ($) | 1 Months Ended | 9 Months Ended | ||
May 26, 2016 | May 25, 2016 | Oct. 31, 2016 | Jan. 31, 2015 | |
Tarpon Bay Partners LLC | ||||
Commitments And Contingencies Disclosure [Line Items] | ||||
Amount due in unpaid notes and services | $ 93,500 | |||
Windstream Holdings, Inc. | ||||
Commitments And Contingencies Disclosure [Line Items] | ||||
Settlement amount | $ 20,000 | |||
Windstream Holdings, Inc. | Connexum, LLC. | ||||
Commitments And Contingencies Disclosure [Line Items] | ||||
Claim amount of unpaid notes and services | $ 600,000 | |||
Actual unpaid usage fees | $ 20,000 | |||
Disputed fees | $ 580,000 |
ASSETS HELD FOR SALE (Details)
ASSETS HELD FOR SALE (Details) | Oct. 31, 2016USD ($) |
Equipment, net of depreciation of $117,984 | |
Long Lived Assets Held-for-sale [Line Items] | |
Assets held for sale | $ 58,991 |
Intangible assets, net of amortization $239,378 | |
Long Lived Assets Held-for-sale [Line Items] | |
Assets held for sale | 119,689 |
Goodwill | |
Long Lived Assets Held-for-sale [Line Items] | |
Assets held for sale | $ 110,905 |
ASSETS HELD FOR SALE (Parenthet
ASSETS HELD FOR SALE (Parentheticals) (Details) - USD ($) | 9 Months Ended | 12 Months Ended |
Oct. 31, 2016 | Jan. 31, 2016 | |
Equipment | ||
Long Lived Assets Held-for-sale [Line Items] | ||
Assets held for sale of equipment, net of depreciation | $ 117,984 | |
Intangible assets | ||
Long Lived Assets Held-for-sale [Line Items] | ||
Assets held for sale of intangible assets, net of amortization | $ 149,611 |
ASSETS HELD FOR SALE (Details T
ASSETS HELD FOR SALE (Details Textuals) | Oct. 31, 2016USD ($) |
Assets Held For Sale [Abstract] | |
Assets held for sales equipment and customer list | $ 400,000 |
ACCOUNTS PAYABLE FORGIVEN (Deta
ACCOUNTS PAYABLE FORGIVEN (Detail Textuals) - USD ($) | 3 Months Ended | 9 Months Ended |
Oct. 31, 2016 | Oct. 31, 2016 | |
Accounts Payable and Accrued Liabilities [Abstract] | ||
Accounts payable forgiven by vendor | $ 250,000 | $ 250,000 |
SUBSEQUENT EVENT (Detail Textua
SUBSEQUENT EVENT (Detail Textuals) | 9 Months Ended |
Oct. 31, 2016USD ($)shares | |
Subsequent Events [Abstract] | |
Common stock issued for conversion of debt | shares | 405,106,884 |
Accrued interest | $ 51,379 |
Equipment and customer list sold | $ 400,000 |