Document and Entity Information
Document and Entity Information - shares | 9 Months Ended | |
Oct. 31, 2017 | Mar. 01, 2018 | |
Document And Entity Information | ||
Entity Registrant Name | Gawk Inc. | |
Entity Central Index Key | 1,546,392 | |
Document Type | 10-Q | |
Document Period End Date | Oct. 31, 2017 | |
Amendment Flag | false | |
Current Fiscal Year End Date | --01-31 | |
Is Entity a Well-known Seasoned Issuer? | No | |
Is Entity a Voluntary Filer? | No | |
Is Entity's Reporting Status Current? | No | |
Entity Filer Category | Smaller Reporting Company | |
Entity Common Stock, Shares Outstanding | 6,342,546,507 | |
Document Fiscal Period Focus | Q3 | |
Document Fiscal Year Focus | 2,018 |
CONSOLIDATED BALANCE SHEETS
CONSOLIDATED BALANCE SHEETS - USD ($) | Oct. 31, 2017 | Jan. 31, 2017 |
Current Assets | ||
Cash and cash equivalents | $ 61,302 | $ 133,249 |
Accounts receivable, net | 225,919 | 232,305 |
Marketable securities - available for sale | 48,000 | 102,300 |
Prepaid and other current assets | 46,828 | 54,028 |
Total Current Assets | 382,049 | 521,882 |
Intangible assets and proprietary technology, net of accumulated amortization of $1,107,765 and $656,244 | 698,310 | 1,149,831 |
Goodwill | 1,416,851 | 1,416,851 |
TOTAL ASSETS | 2,497,210 | 3,088,564 |
Current Liabilities | ||
Accounts payable and accrued liabilities | 2,462,302 | 1,953,401 |
Note payable, net of unamortized discounts of $206,059 and $1,546 | 549,499 | 98,930 |
Current portion of notes payable -related party | 577,182 | 614,085 |
Current portion of convertible notes payable, net of unamortized discounts of $nil and $598,790 | 3,089,377 | 2,061,952 |
Investor payable - common shares | 658,000 | 658,000 |
Due to related parties | 369,323 | 305,458 |
Derivative liabilities | 2,716,691 | 2,088,684 |
Total Current Liabilities | 10,422,374 | 7,780,510 |
Long-Term Liabilities | ||
Notes payables -related party, less current portion | 159,514 | |
TOTAL LIABILITIES | 10,422,374 | 7,940,024 |
Stockholders' Deficit | ||
Common stock, $0.001 par value, 14,900,000,000 shares authorized; 6,342,546,507 and 2,357,089,633 shares issued and outstanding, respectively | 6,343,046 | 2,357,089 |
Additional paid-in capital | 1,160,177 | 984,577 |
Common stock issued at discount to par value | (3,244,638) | |
Accumulated deficit | (30,351,938) | (26,361,315) |
Total Stockholders' Deficit | (26,025,164) | (22,951,460) |
TOTAL LIABILITIES AND STOCKHOLDERS' DEFICIT | 2,497,210 | 3,088,564 |
Series A Preferred Stock [Member] | ||
Stockholders' Deficit | ||
Preferred stock, $0.001 par value; authorized 100,000,000 shares | 1 | 1 |
Series B Preferred Stock [Member] | ||
Stockholders' Deficit | ||
Preferred stock, $0.001 par value; authorized 100,000,000 shares | 68,188 | 68,188 |
Series C Convertible Preferred Stock [Member] | ||
Stockholders' Deficit | ||
Preferred stock, $0.001 par value; authorized 100,000,000 shares | 16,000,000 | 16,000,000 |
Series D Convertible Preferred Stock [Member] | ||
Stockholders' Deficit | ||
Preferred stock, $0.001 par value; authorized 100,000,000 shares | 2,100,000 | 2,100,000 |
Convertible Preferred Stock [Member] | ||
Stockholders' Deficit | ||
Preferred stock, $0.001 par value; authorized 100,000,000 shares | $ 18,100,000 | $ 18,100,000 |
CONSOLIDATED BALANCE SHEETS (Pa
CONSOLIDATED BALANCE SHEETS (Parenthetical) - USD ($) | Oct. 31, 2017 | Jan. 31, 2017 |
ASSETS | ||
Accumulated amortization on intangible assets | $ 1,107,765 | $ 656,244 |
LIABILITIES AND STOCKHOLDERS' DEFICIT | ||
Note payable, net of unamortized discounts | 206,059 | 1,546 |
Discount on convertible note payable | $ 0 | $ 598,790 |
Stockholders' Deficit | ||
Preferred stock, par value | $ 0.001 | $ 0.001 |
Preferred stock, shares authorized | 100,000,000 | 100,000,000 |
Common stock, par value | $ 0.001 | $ 0.001 |
Common stock, shares authorized | 14,900,000,000 | 14,900,000,000 |
Common stock, shares issued | 6,342,546,507 | 6,342,546,507 |
Common stock, shares outstanding | 2,357,089,633 | 2,357,089,633 |
Series A Preferred Stock [Member] | ||
Stockholders' Deficit | ||
Preferred stock, par value | $ 0.001 | $ 0.001 |
Preferred stock, shares issued | 1,000 | 1,000 |
Preferred stock, shares outstanding | 1,000 | 1,000 |
Preferred stock, shares designated | 1,000 | 1,000 |
Series B Preferred Stock [Member] | ||
Stockholders' Deficit | ||
Preferred stock, par value | $ 0.001 | $ 0.001 |
Preferred stock, shares issued | 68,187,500 | 68,187,500 |
Preferred stock, shares outstanding | 68,187,500 | 68,187,500 |
Preferred stock, shares designated | 95,000,000 | 95,000,000 |
Series C Convertible Preferred Stock [Member] | ||
Stockholders' Deficit | ||
Preferred stock, par value | $ 0.001 | $ 0.001 |
Preferred stock, shares issued | 16 | 16 |
Preferred stock, shares outstanding | 16 | 16 |
Preferred stock, shares designated | 100 | 100 |
Series D Convertible Preferred Stock [Member] | ||
Stockholders' Deficit | ||
Preferred stock, par value | $ 0.001 | $ 0.001 |
Preferred stock, shares issued | 21 | 21 |
Preferred stock, shares outstanding | 21 | 21 |
Preferred stock, shares designated | 1,000 | 1,000 |
CONSOLIDATED STATEMENTS OF OPER
CONSOLIDATED STATEMENTS OF OPERATIONS (Unaudited) - USD ($) | 3 Months Ended | 9 Months Ended | ||
Oct. 31, 2017 | Oct. 31, 2016 | Oct. 31, 2017 | Oct. 31, 2016 | |
Consolidated Statements Of Operations | ||||
Revenue | $ 1,341,548 | $ 1,747,891 | $ 4,155,637 | $ 4,367,218 |
Operating expenses | ||||
Cost of revenue | 1,034,311 | 1,221,442 | 3,173,418 | 3,210,305 |
General and administration | 506,270 | 691,818 | 1,823,062 | 1,917,697 |
Accounts payable forgiven | (250,000) | (250,000) | ||
Legal settlement | 25,000 | |||
Depreciation and amortization | 150,507 | 186,622 | 451,521 | 559,866 |
Total operating expenses | 1,691,088 | 1,849,882 | 5,473,001 | 5,437,868 |
Net loss from operations | (349,540) | (101,991) | (1,317,364) | (1,070,650) |
Other income (expense) | ||||
Other income | 4,825 | 6,372 | 15,637 | 16,658 |
Interest expense, net | (303,722) | (365,940) | (2,095,192) | (1,270,673) |
Unrealized gain (loss) on marketable securities | (22,500) | 67,200 | (54,300) | 84,600 |
Change in fair value of derivative liabilities | (752,196) | (149,358) | (785,551) | (250,987) |
Gain on sale of assets | 73,728 | |||
Gain on settlement of debt | 9,277 | 172,419 | 9,277 | |
Total other expense | (1,073,593) | (432,449) | (2,673,259) | (1,411,125) |
Loss from continuing operations | (1,423,133) | (534,440) | (3,990,623) | (2,481,775) |
Gain (loss) from discontinued operations, net of tax benefits | ||||
Gain from discontinued operations | (33,759) | (58,134) | ||
Total gain (loss) from discontinued operations | (33,759) | (58,134) | ||
Net loss | $ (1,423,133) | $ (568,199) | $ (3,990,623) | $ (2,539,909) |
Basic and diluted loss per common share from continued operation | $ 0 | $ 0 | $ 0 | $ 0.01 |
Basic and diluted loss per common share from discontinued operation | $ 0 | $ 0 | $ 0 | $ 0 |
Weighted average number of common shares outstanding, basic and diluted | 6,343,046,507 | 648,943,956 | 5,662,774,796 | 446,743,266 |
CONSOLIDATED STATEMENTS OF CASH
CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited) - USD ($) | 9 Months Ended | |
Oct. 31, 2017 | Oct. 31, 2016 | |
CASH FLOWS FROM OPERATING ACTIVITIES: | ||
Net loss | $ (3,990,623) | $ (2,539,909) |
Adjustments to reconcile net loss to net cash used in operating activities: | ||
Common stock options issued for services | 177,000 | |
Stock-based compensation | 174,000 | 221,913 |
Amortization of debt discount and deferred financing fees | 1,361,108 | 835,664 |
Unrealized gain on marketable securities | 54,300 | (84,600) |
Amortization expense of intangible assets | 451,521 | 559,866 |
Depreciation expense from discontinued operations | 44,244 | |
Amortization expense from discontinued operations | 89,766 | |
Accounts payable forgiven | (250,000) | |
Gain on settlement of liabilities | (172,419) | (9,277) |
Default penalty | 348,879 | |
Change in fair value of derivative liabilities | 785,551 | 250,987 |
Gain on sale of intangible asset | (73,728) | |
(Increase) decrease in operating assets: | ||
Accounts receivable | 6,386 | (170,800) |
Prepaid expenses and other assets | 7,200 | (2,565) |
Increase (decrease) in operating liabilities: | ||
Accounts payable and accrued liabilities | 643,592 | 402,215 |
Due to related parties | 63,865 | 260,931 |
Other current liabilities | 3,962 | |
Net Cash Used In Operating Activities | (340,368) | (210,603) |
CASH FLOWS FROM INVESTING ACTIVITIES: | ||
Acquisition of XTELUS, net of cash acquired | 397 | |
Sales of intangible assets | 73,728 | |
Net Cash Provided by Investing Activities | 73,728 | 397 |
CASH FLOWS FROM FINANCING ACTIVITIES: | ||
Proceeds from notes payable | 1,064,514 | 147,050 |
Payment of notes payable | (819,441) | (11,161) |
Proceeds from convertible notes, net of original issue discounts and deferred financing fees | 144,500 | 691,733 |
Payment of convertible notes payable | (63) | (33,333) |
Proceeds from notes payable - related party | 25,000 | |
Payment of notes payable - related party | (196,417) | (505,444) |
Contribution | 1,600 | |
Proceeds from issuance of Series B Preferred stock | 20,000 | |
Net Cash Provided By Financing Activities | 194,693 | 333,845 |
Effect of exchange rate changes | ||
Net increase (decrease) in cash and cash equivalents | (71,947) | 123,639 |
Cash and cash equivalents, beginning of period | 133,249 | 64,944 |
Cash and cash equivalents, end of period | 61,302 | 188,583 |
Supplemental cash flow information | ||
Cash paid for interest | 118,685 | 242,902 |
Cash paid for taxes | ||
Non-cash financing transactions: | ||
Acquisition of XTELUS through issuance of Series D Preferers shares | 100,000 | |
Series B Preferred shares issued to settle preferred share payable | 13,438 | |
Issuance of common stock for conversion of debt and accrued interest | 741,319 | 1,515,482 |
Common stock issued in exchange for warrants | 41,000 | |
Debt discount from derivative liability | 536,222 | 848,172 |
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, 2017 | |
Notes to Financial Statements | |
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 managed network services that converge voice and data applications. |
GOING CONCERN
GOING CONCERN | 9 Months Ended |
Oct. 31, 2017 | |
Notes to Financial Statements | |
NOTE 2 - 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 deficiency in equity of $26,025,164, a working capital deficit of $10,040,325, and an accumulated deficit of $30,351,938. These factors raise substantial doubt about the Companys 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 Companys continued existence is dependent upon managements ability to develop profitable operations, continued contributions from the Companys 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 Companys products and business. |
SUMMARY OF SIGNIFICANT ACCOUNTI
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | 9 Months Ended |
Oct. 31, 2017 | |
Notes to Financial Statements | |
NOTE 3 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | 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 our opinion, all adjustments (consisting of normal recurring adjustments) considered necessary for a fair presentation have been included. Operating results for the nine months ended October 31, 2017 are not necessarily indicative of the results that may be expected for the year ending January 31, 2018. Notes to the unaudited interim consolidated financial statements that would substantially duplicate the disclosures contained in the audited consolidated financial statements for fiscal year 2017 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, 2017 included in the Companys Form 10-K/A as filed with the Securities and Exchange Commission on October 24, 2017. 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. Principles of Consolidation The consolidated financial statements include the accounts of the Company and its subsidiaries. All intercompany accounts and transactions have been eliminated. We currently have no investments accounted for using the equity or cost methods of accounting. Reclassifications Certain prior year amounts have been reclassified to conform with the current year presentation. Revenue Recognition The Company pursues opportunities to realize revenues from consulting services. It is the companys policy that revenues and gains will be recognized in accordance with ASC Topic 605-10-25, Revenue Recognition. Under ASC Topic 605-10-25, revenue earning activities are recognized when all of the following criteria are met: (i) persuasive evidence of an arrangement exists, (ii) the services have been rendered to the customer, (iii) the sales price is fixed or determinable, and (iv) collectability is reasonably assured. 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. Derivative Financial Instruments The fair value of an embedded conversion option that is convertible into a variable amount of shares and warrants that include price protection reset provision features are deemed to be down-round protection and, therefore, do not meet the scope exception for treatment as a derivative under ASC 815 Derivatives and Hedging, since down-round protection is not an input into the calculation of the fair value of the conversion option and warrants and cannot be considered indexed to the Companys own stock which is a requirement for the scope exception as outlined under ASC 815. The accounting treatment of derivative financial instruments requires that the Company record the embedded conversion option and warrants at their fair values as of the inception date of the agreement and at fair value as of each subsequent balance sheet date. Any change in fair value is recorded as non-operating, non-cash income or expense for each reporting period at each balance sheet date. The Company reassesses the classification of its derivative instruments at each balance sheet date. If the classification changes as a result of events during the period, the contract is reclassified as of the date of the event that caused the reclassification. The Black-Scholes option valuation model was used to estimate the fair value of the embedded conversion options and warrants. The model includes subjective input assumptions that can materially affect the fair value estimates. The expected volatility is estimated based on the most recent historical period of time, of our common stock, equal to the weighted average life of the options. Conversion options are recorded as debt discount and are amortized as interest expense over the life of the underlying debt instrument. Fair Value of Financial Instruments The Companys financial instruments consist primarily of cash, accounts payable and accrued expenses, 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, 2017 and January 31, 2017 for assets measured at fair value on a recurring basis: Carrying Value at October 31, 2017 October 31, 2017 Level 1 Level 2 Level 3 Total Marketable securities- available for sale $ 48,000 $ - $ - $ 48,000 Derivative liabilities $ - $ - $ 2,716,691 $ 2,716,691 Carrying Value at January 31, 2017 January 31, 2017 Level 1 Level 2 Level 3 Total Marketable securities- available for sale $ 102,300 $ - $ - $ 102,300 Derivative liabilities $ - $ - $ 2,088,684 $ 2,088,684 Recent Accounting Pronouncements In May 2014, FASB issued ASU 2014-09, Revenue from Contracts with Customers In March 2016, the FASB issued ASU 2016-08, Revenue from Contracts with Customers: Principal versus Agent Considerations (Reporting Revenue Gross versus Net), which clarifies the guidance in the new revenue standard on assessing whether an entity is a principal or an agent in a revenue transaction. This conclusion impacts whether an entity reports revenue on a gross or net basis. We are currently evaluating the impact of this standard on our Consolidated Financial Statements and related disclosures. In April 2016, the FASB issued ASU 2016-10, Revenue from Contracts with Customers: Identifying Performance Obligations and Licensing, which clarifies the guidance in the new revenue standard regarding an entitys identification of its performance obligations in a contract, as well as an entitys evaluation of the nature of its promise to grant a license of intellectual property and whether or not that revenue is recognized over time or at a point in time. We are currently evaluating the impact of this standard on our Consolidated Financial Statements and related disclosures. In May 2016, the FASB issued ASU 2016-12, Revenue from Contracts with Customers: Narrow- Scope Improvements and Practical Expedients which amends the guidance in the new revenue standard on collectability, noncash consideration, presentation of sales tax, and transition. The amendments are intended to address implementation issues and provide additional practical expedients to reduce the cost and complexity of applying the new revenue standard. These amendments have the same effective date as the new revenue standard. While we are currently evaluating the method of adoption and the impact of the new revenue standard, as amended, on our Consolidated Financial Statements and related disclosures, we believe the adoption of the new standard may have a significant impact on the accounting for certain transactions with multiple elements or bundled arrangements because the requirement to have VSOE for undelivered elements under current accounting standards is eliminated under the new standard. Accordingly, we may be required to recognize as revenue a portion of the sales price upon delivery of the software, as compared to the current requirement of recognizing the entire sales price ratably over an estimated offering period. We continue to evaluate the impact of the new revenue standard on our Consolidated Financial Statements and related disclosures. In June 2016, the FASB issued ASU 2016-13, Financial Instruments: Measurement of Credit Losses on Financial Instruments which amends the guidance on measuring credit losses on financial assets held at amortized cost. The amendment is intended to address the issue that the previous incurred loss methodology was restrictive for Companys ability to record credit losses based on not yet meeting the probable threshold. The new language will require these assets to be valued at amortized cost presented at the net amount expected to be collected will a valuation provision. The amendments will be effective for fiscal years beginning after December 15, 2019. We are evaluating the impact of this amendment on our consolidated financial statements and related disclosures. In February 2016, FASB issued ASU 2016-02, Leases |
DISCONTINUED OPERATIONS
DISCONTINUED OPERATIONS | 9 Months Ended |
Oct. 31, 2017 | |
Notes to Financial Statements | |
NOTE 4 - DISCONTINUED OPERATIONS | 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, customer list of Webrunner and bank accounts related to Webrunner for $413,861, payable in installments. The Company recorded gain on sales of assets of $111,467 as discontinued operations during the year ended January 31, 2017. The total consideration received was $401,052. The following table shows the results of operations of Webrunner for the nine months ended October 31, 2017 and 2016 which are included in the loss from discontinued operations: Three Months Ended Nine Months Ended October 31, October 31, 2017 2016 2017 2016 Revenue $ - $ 63,825 $ - $ 224,580 Operating expenses General and administration - (52,914 ) - (148,704 ) Depreciation and amortization - (44,670 ) - (134,010 ) Loss from discontinued operations $ - $ (33,759 ) $ - $ (58,134 ) |
NOTES PAYABLE
NOTES PAYABLE | 9 Months Ended |
Oct. 31, 2017 | |
Notes to Financial Statements | |
NOTE 5 - NOTES PAYABLE | The Company had the following notes payable and notes payable related party outstanding as of October 31, 2017 and January 31, 2017: Notes Payable October 31, January 31, 2017 2017 Dated October 30, 2014 $ 10,000 $ 10,000 Dated August 4, 2016 25,000 25,000 Dated September 30, 2016 - 65,476 Dated March 10, 2017 99,561 - Dated April 11, 2017 - - Dated May 16, 2017 48,681 - Dated May 30, 2017 - - Dated July 10, 2017 - - Dated July 21, 2017 108,342 - Dated September 14, 2017 128,187 - Dated October 2, 2017 197,554 - Dated October 23, 2017 138,233 - Total notes payable $ 755,558 $ 100,476 Less: debt discount and deferred financing fees (206,059 ) (1,546 ) 549,499 98,930 Less: current portion of notes payable 549,499 98,930 Long-term notes payable - - The Company recognized amortization expense related to the debt discount and deferred financing fees of $205,497 and $0 for the nine months ended October 31, 2017 and 2016, respectively. The total borrowings on note payable during the nine months ended October 31, 2017 and 2016 was $1,064,514 and $147,050, respectively. The total principal repayment on note payable during the nine months ended October 31, 2017 and 2016 was $819,441 and $11,161, 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 August 4, 2016 The note was issued to Mr. Doyle Knudson, are subject to annual interest of 15% and are secured by 250,000 shares of common stock. The note matured in February 2017. The total cash proceeds received from the note was $25,000. 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. During the three months ended April 30, 2017, the Company repaid $65,476 fully. Dated March 10, 2017 The Company entered into the revenue based factoring agreement with PIRS Capital, LLC. The principal amount of note is $291,900 and the note includes an original issue discount and financing fee of $86,499 and the Company received cash of $205,401. The Company is required to make weekly principal and interest payments of $5,657 for a period of 51 weeks through February 23, 2018. Dated April 11, 2017 The Company entered into the revenue based factoring agreement with Powerup Lending Group, Ltd. The principal amount of note is $156,250 and the note includes an original issue discount and financing fee of $33,750 and the Company received cash of $122,500. The Company is required to make weekly principal and interest payments of $4,560 for a period of 34 weeks through December 5, 2017. On October 2, 2017, the Company fully repaid the outstanding balance of $39,993. Dated May 16, 2017 The Company entered into the agreement with Arcarius LLC. The principal amount of note is $136,000 and the note includes an original issue discount and financing fee of $38,495 and the Company received cash of $97,505. The Company is required to make daily principal and interest payments of $773 for a period of 176 days. Dated May 30, 2017 The Company entered into the revenue based factoring agreement with Powerup Lending Group, Ltd. The principal amount of note is $108,000 and the note includes an original issue discount and financing fee of $29,600 and the Company received cash of $78,400. The Company is required to make weekly principal and interest payments of $4,286 for a period of 26 weeks through December 30, 2017. On October 2, 2017, the Company fully repaid the outstanding balance of $35,142. Dated July 10, 2017 The Company entered into the revenue based factoring agreement with Powerup Lending Group, Ltd. The principal amount of note is $54,000 and the note includes an original issue discount and financing fee of $14,800 and the Company received cash of $39,200. The Company is required to make daily principal and interest payments of $600 for a period of 90 days. On October 2, 2017, the Company fully repaid the outstanding balance of $18,600. Dated July 21, 2017 The Company entered into the revenue based factoring agreement with PIRS Capital, LLC. The principal amount of note is $170,000 and the note includes an original issue discount and financing fee of $47,899 and the Company received cash of $122,101. The Company is required to make weekly principal and interest payments of $4,404 for a period of 39 weeks through April 20, 2018. Dated September 14, 2017 The Company entered into the agreement with Richmond Capital Group. The principal amount of note is $174,875 and the note includes an original issue discount and financing fee of $54,873 and the Company received cash of $120,002. The Company is required to make daily principal and interest payments of $1,459 for a period of 120 days. Dated October 2, 2017 The Company entered into the revenue based factoring agreement with Powerup Lending Group, Ltd. The principal amount of note is $240,500 and the note includes an original issue discount and financing fee of $59,200 and the Company received cash of $181,300. The Company is required to make principal and interest payments of $6,135 twice a week. Dated October 23, 2017 The Company entered into the agreement with Prosperitas Capital, LLC. The principal amount of note is $143,000 and the note includes an original issue discount and financing fee of $44,895 and the Company received cash of $98,105. The Company is required to make daily principal and interest payments of $1,589 for a period of 90 days. Notes Payable related party October 31, January 31, 2017 2017 Dated April 23, 2015 $ 226,250 $ 231,250 Dated - December 21, 2016 350,932 542,349 Total notes payable 577,182 773,599 Less: current portion of notes payable 577,182 614,085 Long-term notes payable $ - $ 159,514 The total borrowings and principal repayment on related party note payable during the nine months ended October 31, 2017 and 2016 was $196,417 and $505,444, respectively. 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 $5,000 during the nine months ended October 31, 2017. Dated December 21, 2016 On December 21, 2016, the Company entered into the new agreement which the company issued a note payable of $574,252 for payment of the Note dated January 18, 2016. The Note bears interest rate of $7.29% for 1 st |
CONVERTIBLE NOTES PAYABLE
CONVERTIBLE NOTES PAYABLE | 9 Months Ended |
Oct. 31, 2017 | |
Notes to Financial Statements | |
NOTE 6 - CONVERTIBLE NOTES PAYABLE | The Company had the following convertible notes payable outstanding as of October 31, 2017 and January 31, 2017: October 31, January 31, 2017 2017 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. - 83,951 Promissory notes Issued in fiscal year 2017, with variable conversion features. 588,728 876,791 Promissory notes Issued in fiscal year 2018, with variable conversion features. 800,649 - Total convertible notes payable 3,089,377 2,660,742 Less: debt discount and deferred financing fees - (598,790 ) 3,089,377 2,061,952 Less: current portion of convertible notes payable 3,089,377 2,061,952 Long-term convertible notes payable $ - $ - Notes in Default Certain convertible notes held by the company are in default. During the three month period ended July 31, 2017, the Company did not maintain the covenant requiring the Company to be current with all financial filings. As a result of the breach, the convertible debentures are due on demand. No demand for payment has been made as at October 31, 2017. The terms of default for notes are as follows: Default interest rates ranging from 20% to 24 % The Conversion Price discount for certain notes shall be permanently increased by 10% The Company shall pay an amount equal to the greater of o (i) 150% times the sum of the outstanding principal amount of certain Notes plus accrued and unpaid interest on the unpaid principal amount of this Notes to the date of payment (the Mandatory Prepayment Date) plus Default Interest. o (ii) the parity value of the Default Sum to be prepaid, where parity value means (a) the highest number of shares of Common Stock issuable upon conversion of or otherwise pursuant to such Default Sum treating the Trading Day immediately preceding the Mandatory Prepayment Date as the Conversion Date for purposes of determining the lowest applicable Conversion Price, unless the Default Event arises as a result of a breach in respect of a specific Conversion Date in which case such Conversion Date shall be the Conversion Date, multiplied by (b) the highest Closing Price for the Common Stock during the period beginning on the date of first occurrence of the Event of Default and ending one day prior to the Mandatory Prepayment Date During the three and nine months ended October 31, 2017, the Company recorded default penalty interest of $15,050 and $348,879 (2016: $nil). The unamortized debt discount has been accelerated and recognized in the consolidated statement of operations and loss. The Company recognized amortization expense related to the debt discount and deferred financing fees of $1,155,612 and $835,664 for the nine months ended October 31, 2017 and 2016, 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 18,000,000 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. The Company initially recorded a discount on the convertible note due to a beneficial conversion feature of $358,200 and fully amortized for the year ended January 31, 2016. 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. Promissory Notes - Issued in fiscal year 2016 During the year ended January 31, 2016, the Company issued a total of $449,666 of promissory 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 Companys 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 Entitys 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. $209,000 of the value assigned to the derivative liability was recognized as a debt discount to the notes while the balance of $250,733 was recognized as a day 1 derivative loss. Promissory Notes - Issued in fiscal year 2017 During the year ended January 31, 2017, the Company issued a total of $1,266,417 of promissory 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% to 60% discount) lowest trading prices of the Companys 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 valued the conversion feature using the Black Scholes valuation model. The fair value of the derivative liability for all the notes that became convertible, including the notes issued in prior years, during the year ended January 31, 2017 amounted to $3,245,991. $1,356,692 of the value assigned to the derivative liability was recognized as a debt discount to the notes while the balance of $1,889,299 was recognized as a day 1 derivative loss. Promissory Notes - Issued in fiscal year 2018 During the nine months ended October 31, 2017, the Company issued a total of $556,822 of promissory notes with the following terms: Terms ranging from 9 months to 12 months Annual interest rates ranging from 10% to 12% Convertible at the option of the holders either at issuance. Conversion prices are typically based on the discounted (40% to 50% discount) lowest trading prices of the Companys shares during various periods prior to conversion. Certain notes allow the Company to redeem the notes at rates ranging from 120% 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 Entitys 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, 2017 amounted to $1,254,497. $536,222 of the value assigned to the derivative liability was recognized as a debt discount to the notes, $240,659 was recognized as a day 1 derivative loss and $166,975 was recognized as gain on settlement of debt and $644,591 offset the fair value of the derivative liability that related to the notes that were replaced by the new notes. Conversion During the nine months ended October 31, 2017, the Company converted notes with principal amounts of $200,566 and accrued interest of $13,962 into 3,985,956,874 shares of common stock. The corresponding derivative liability at the date of conversion of $526,791 was credited to common stock issued at a discount. Replacement of Notes During the year ended January 31, 2017, the Company assigned 16 notes with outstanding principal amounts totaling to $424,178 to two lenders which resulted to the payment of prepayment penalties amounting to $156,809 and recognized loss on debt settlement of $267,646 due to the modification of the replacement note conversion feature, and the difference between the fair value of derivative of the conversion feature. As a result of replacement of notes during the nine months ended October 31, 2017, the Company recognized gain on settlement of debt of $166,975. |
DERIVATIVE LIABILITIES
DERIVATIVE LIABILITIES | 9 Months Ended |
Oct. 31, 2017 | |
Notes to Financial Statements | |
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, 2017. 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, 2017 and January 31, 2017: Nine Months Ended Year Ended October 31, 2017 January 31, 2017 Expected term 0.01 - 0.88 years 0 - 1.50 years Expected average volatility 0% - 483% 120% - 716% Expected dividend yield - - Risk-free interest rate 0.51% - 1.45% 0.18% - 0.84% At October 31, 2017, the estimated fair values of the liabilities measured on a recurring basis are as follows: October 31, 2017 Level 1 Level 2 Level 3 Total Promissory Note Issued August 22, 2014 $ - $ - $ 1,700 $ 1,700 Promissory Notes Issued in fiscal year 2017 - - 1,570,820 1,570,820 Promissory Notes Issued in fiscal year 2018 - - 1,144,171 1,144,171 Total liabilities $ - $ - $ 2,716,691 $ 2,716,691 The following table summarizes the changes in the derivative liabilities during the nine months ended October 31, 2017: Fair Value Measurements Using Significant Observable Inputs (Level 3) Balance - January 31, 2017 $ 2,088,684 Addition of new derivatives recognized as debt discounts 536,222 Addition of new derivatives recognized as loss on derivatives 240,659 Derivatives settled upon conversion of debt and exercise of warrants (526,791 ) Loss on debt extinguishment (166,975 ) Loss on change in fair value of the derivative 544,892 Balance - October 31, 2017 $ 2,716,691 The following table summarizes the loss on derivative liability included in the income statement for the nine months ended October 31, 2017 and 2016, respectively. Nine Months Ended October 31, 2017 2016 Day one loss due to derivative liabilities on convertible notes $ 240,659 $ 778,989 (Gain) loss on change in fair value of the derivative liabilities 544,892 (528,002 ) Loss on change in the fair value of derivative liabilities $ 785,551 $ 250,987 |
EQUITY
EQUITY | 9 Months Ended |
Oct. 31, 2017 | |
Notes to Financial Statements | |
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, 2017. As of October 31, 2017 and January 31, 2017, 1,000 shares of Series A Preferred Stock were issued and outstanding, respectively. Series B Convertible Preferred Stock There were no issuances of the Series B Preferred Stock during the nine months ended October 31, 2017. As of October 31, 2017 and January 31, 2017, 68,178,500 shares of Series B Preferred Stock were issued and outstanding, respectively. Series C Convertible Preferred Stock There were no issuances of the Series C Preferred Stock during the nine months ended October 31, 2017. As of October 31, 2017 and January 31, 2017, 16 shares of Series C Preferred Stock were issued and outstanding, respectively. The Company determined the Series C Convertible Preferred Stock is considered to be contingently redeemable convertible and as a result, has been classified as mezzanine equity in the Companys balance sheet, as of October 31, 2017 and January 31, 2017. Series D Convertible Preferred Stock There were no issuances of the Series D Preferred Stock during the nine months ended October 31, 2017. As of October 31, 2017 and January 31, 2017, 21 shares of Series D Preferred Stock were issued and outstanding, respectively. The Company determined the Series D Convertible Preferred Stock is considered to be contingently redeemable convertible and as a result, has been classified as mezzanine equity in the Companys balance sheet, as of October 31, 2017 and January 31, 2017. Common stock The Company is authorized to issue 14,900,000,000 shares of common stock at a par value of $0.001. During the nine months ended October 31, 2017, the Company issued common shares, as follows: 3,985,956,874 common shares were issued for the conversion of debt and accrued interest of $214,528. As of October 31, 2017, and January 31, 2017, 6,343,046,507 and 2,357,089,633 shares of common stock were issued and outstanding, respectively. Warrants and Options Warrants As of October 31, 2017, and January 31, 2017, there are no warrants outstanding. Options The Company has 9,100,000 options issued in connection with the acquisition of Webrunner. The following table summarizes information relating to outstanding and exercisable stock options as of October 31, 2017: Options Outstanding Weighted Average Shares Exercise Price Outstanding, January 31, 2017 9,100,000 $ 0.10 Granted - - Exercised - - Forfeited/canceled - - Outstanding, October 31, 2017 9,100,000 $ 0.10 Options Outstanding Options Exercisable Number of Shares Weighted Average Remaining Contractual life (in years) Weighted Average Exercise Price Number of Shares Weighted Average Exercise Price 9,100,000 2.00 $ 0.10 9,100,000 $ 0.10 The options have no intrinsic value at October 31, 2017. 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 nine months ended October 31, 2017 and 2016, the Company recognized stock based compensation of $174,000 and $61,157 under these awards, with a corresponding credit to additional paid in capital. |
CONTINGENCIES
CONTINGENCIES | 9 Months Ended |
Oct. 31, 2017 | |
Notes to Financial Statements | |
NOTE 9 - CONTINGENCIES | The Company is a party to various legal claims which have arisen in the normal course of business, none of which are expected to have a material adverse effect on the financial position, results of operations, or cash flows of the Company. |
RELATED PARTY TRANSACTIONS
RELATED PARTY TRANSACTIONS | 9 Months Ended |
Oct. 31, 2017 | |
Notes to Financial Statements | |
NOTE 10 - RELATED PARTY TRANSACTIONS | During the nine months ended October 31, 2017, the Company paid a total of $179,850 consulting fees to the companys officers. As of October 31, 2017, and January 31, 2017, the amount owed to the companys officers was $179,790 and $0, respectively. As of October 31, 2017, and January 31, 2017, the Company has outstanding notes payable to Net D totaling to $577,182 and $773,599, respectively, in connection with the Companys acquisition of Connexum and certain assets of Net D (see Note 5). The sole owner of Net D is a director the Company. Net D also performs certain services for the Company in connection with the latters Carrier Services business. During the nine months ended October 31, 2017, the Company incurred total fees in connection with such services of $222,478. As of October 31, 2017, and January 31, 2017, the Company has an outstanding payable to Net D of $189,533 and $305,458, respectively. |
SUMMARY OF SIGNIFICANT ACCOUN16
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Policies) | 9 Months Ended |
Oct. 31, 2017 | |
Summary Of Significant Accounting Policies Policies | |
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 our opinion, all adjustments (consisting of normal recurring adjustments) considered necessary for a fair presentation have been included. Operating results for the nine months ended October 31, 2017 are not necessarily indicative of the results that may be expected for the year ending January 31, 2018. Notes to the unaudited interim consolidated financial statements that would substantially duplicate the disclosures contained in the audited consolidated financial statements for fiscal year 2017 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, 2017 included in the Companys Form 10-K/A as filed with the Securities and Exchange Commission on October 24, 2017. |
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. |
Principles of Consolidation | The consolidated financial statements include the accounts of the Company and its subsidiaries. All intercompany accounts and transactions have been eliminated. We currently have no investments accounted for using the equity or cost methods of accounting. |
Reclassifications | Certain prior year amounts have been reclassified to conform with the current year presentation. |
Revenue Recognition | The Company pursues opportunities to realize revenues from consulting services. It is the companys policy that revenues and gains will be recognized in accordance with ASC Topic 605-10-25, Revenue Recognition. Under ASC Topic 605-10-25, revenue earning activities are recognized when all of the following criteria are met: (i) persuasive evidence of an arrangement exists, (ii) the services have been rendered to the customer, (iii) the sales price is fixed or determinable, and (iv) collectability is reasonably assured. 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. |
Derivative Financial Instruments | The fair value of an embedded conversion option that is convertible into a variable amount of shares and warrants that include price protection reset provision features are deemed to be down-round protection and, therefore, do not meet the scope exception for treatment as a derivative under ASC 815 Derivatives and Hedging, since down-round protection is not an input into the calculation of the fair value of the conversion option and warrants and cannot be considered indexed to the Companys own stock which is a requirement for the scope exception as outlined under ASC 815. The accounting treatment of derivative financial instruments requires that the Company record the embedded conversion option and warrants at their fair values as of the inception date of the agreement and at fair value as of each subsequent balance sheet date. Any change in fair value is recorded as non-operating, non-cash income or expense for each reporting period at each balance sheet date. The Company reassesses the classification of its derivative instruments at each balance sheet date. If the classification changes as a result of events during the period, the contract is reclassified as of the date of the event that caused the reclassification. The Black-Scholes option valuation model was used to estimate the fair value of the embedded conversion options and warrants. The model includes subjective input assumptions that can materially affect the fair value estimates. The expected volatility is estimated based on the most recent historical period of time, of our common stock, equal to the weighted average life of the options. Conversion options are recorded as debt discount and are amortized as interest expense over the life of the underlying debt instrument. |
Fair Value of Financial Instruments | The Companys financial instruments consist primarily of cash, accounts payable and accrued expenses, 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, 2017 and January 31, 2017 for assets measured at fair value on a recurring basis: Carrying Value at October 31, 2017 October 31, 2017 Level 1 Level 2 Level 3 Total Marketable securities- available for sale $ 48,000 $ - $ - $ 48,000 Derivative liabilities $ - $ - $ 2,716,691 $ 2,716,691 Carrying Value at January 31, 2017 January 31, 2017 Level 1 Level 2 Level 3 Total Marketable securities- available for sale $ 102,300 $ - $ - $ 102,300 Derivative liabilities $ - $ - $ 2,088,684 $ 2,088,684 |
Recent Accounting Pronouncements | In May 2014, FASB issued ASU 2014-09, Revenue from Contracts with Customers In March 2016, the FASB issued ASU 2016-08, Revenue from Contracts with Customers: Principal versus Agent Considerations (Reporting Revenue Gross versus Net), which clarifies the guidance in the new revenue standard on assessing whether an entity is a principal or an agent in a revenue transaction. This conclusion impacts whether an entity reports revenue on a gross or net basis. We are currently evaluating the impact of this standard on our Consolidated Financial Statements and related disclosures. In April 2016, the FASB issued ASU 2016-10, Revenue from Contracts with Customers: Identifying Performance Obligations and Licensing, which clarifies the guidance in the new revenue standard regarding an entitys identification of its performance obligations in a contract, as well as an entitys evaluation of the nature of its promise to grant a license of intellectual property and whether or not that revenue is recognized over time or at a point in time. We are currently evaluating the impact of this standard on our Consolidated Financial Statements and related disclosures. In May 2016, the FASB issued ASU 2016-12, Revenue from Contracts with Customers: Narrow- Scope Improvements and Practical Expedients which amends the guidance in the new revenue standard on collectability, noncash consideration, presentation of sales tax, and transition. The amendments are intended to address implementation issues and provide additional practical expedients to reduce the cost and complexity of applying the new revenue standard. These amendments have the same effective date as the new revenue standard. While we are currently evaluating the method of adoption and the impact of the new revenue standard, as amended, on our Consolidated Financial Statements and related disclosures, we believe the adoption of the new standard may have a significant impact on the accounting for certain transactions with multiple elements or bundled arrangements because the requirement to have VSOE for undelivered elements under current accounting standards is eliminated under the new standard. Accordingly, we may be required to recognize as revenue a portion of the sales price upon delivery of the software, as compared to the current requirement of recognizing the entire sales price ratably over an estimated offering period. We continue to evaluate the impact of the new revenue standard on our Consolidated Financial Statements and related disclosures. In June 2016, the FASB issued ASU 2016-13, Financial Instruments: Measurement of Credit Losses on Financial Instruments which amends the guidance on measuring credit losses on financial assets held at amortized cost. The amendment is intended to address the issue that the previous incurred loss methodology was restrictive for Companys ability to record credit losses based on not yet meeting the probable threshold. The new language will require these assets to be valued at amortized cost presented at the net amount expected to be collected will a valuation provision. The amendments will be effective for fiscal years beginning after December 15, 2019. We are evaluating the impact of this amendment on our consolidated financial statements and related disclosures. In February 2016, FASB issued ASU 2016-02, Leases |
SUMMARY OF SIGNIFICANT ACCOUN17
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Tables) | 9 Months Ended |
Oct. 31, 2017 | |
Summary Of Significant Accounting Policies Tables | |
Schedule of fair value measured on recurring basis | Carrying Value at October 31, 2017 October 31, 2017 Level 1 Level 2 Level 3 Total Marketable securities- available for sale $ 48,000 $ - $ - $ 48,000 Derivative liabilities $ - $ - $ 2,716,691 $ 2,716,691 Carrying Value at January 31, 2017 January 31, 2017 Level 1 Level 2 Level 3 Total Marketable securities- available for sale $ 102,300 $ - $ - $ 102,300 Derivative liabilities $ - $ - $ 2,088,684 $ 2,088,684 |
DISCONTINUED OPERATIONS (Tables
DISCONTINUED OPERATIONS (Tables) | 9 Months Ended |
Oct. 31, 2017 | |
Discontinued Operations Tables | |
Schedule of results of operations | Three Months Ended Nine Months Ended October 31, October 31, 2017 2016 2017 2016 Revenue $ - $ 63,825 $ - $ 224,580 Operating expenses General and administration - (52,914 ) - (148,704 ) Depreciation and amortization - (44,670 ) - (134,010 ) Loss from discontinued operations $ - $ (33,759 ) $ - $ (58,134 ) |
NOTES PAYABLE (Tables)
NOTES PAYABLE (Tables) | 9 Months Ended |
Oct. 31, 2017 | |
Notes Payable Tables | |
Schedule of summary of notes payable | October 31, January 31, 2017 2017 Dated October 30, 2014 $ 10,000 $ 10,000 Dated August 4, 2016 25,000 25,000 Dated September 30, 2016 - 65,476 Dated March 10, 2017 99,561 - Dated April 11, 2017 - - Dated May 16, 2017 48,681 - Dated May 30, 2017 - - Dated July 10, 2017 - - Dated July 21, 2017 108,342 - Dated September 14, 2017 128,187 - Dated October 2, 2017 197,554 - Dated October 23, 2017 138,233 - Total notes payable $ 755,558 $ 100,476 Less: debt discount and deferred financing fees (206,059 ) (1,546 ) 549,499 98,930 Less: current portion of notes payable 549,499 98,930 Long-term notes payable - - |
Schedule of note payable related party | October 31, January 31, 2017 2017 Dated April 23, 2015 $ 226,250 $ 231,250 Dated - December 21, 2016 350,932 542,349 Total notes payable 577,182 773,599 Less: current portion of notes payable 577,182 614,085 Long-term notes payable $ - $ 159,514 |
CONVERTIBLE NOTES PAYABLE (Tabl
CONVERTIBLE NOTES PAYABLE (Tables) | 9 Months Ended |
Oct. 31, 2017 | |
Convertible Notes Payable Tables | |
Convertible notes payable outstanding | October 31, January 31, 2017 2017 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. - 83,951 Promissory notes Issued in fiscal year 2017, with variable conversion features. 588,728 876,791 Promissory notes Issued in fiscal year 2018, with variable conversion features. 800,649 - Total convertible notes payable 3,089,377 2,660,742 Less: debt discount and deferred financing fees - (598,790 ) 3,089,377 2,061,952 Less: current portion of convertible notes payable 3,089,377 2,061,952 Long-term convertible notes payable $ - $ - |
DERIVATIVE LIABILITIES (Tables)
DERIVATIVE LIABILITIES (Tables) | 9 Months Ended |
Oct. 31, 2017 | |
Derivative Liabilities Tables | |
Schedule of weighted-average assumptions used in Black-Scholes valuation model | Nine Months Ended Year Ended October 31, 2017 January 31, 2017 Expected term 0.01 - 0.88 years 0 - 1.50 years Expected average volatility 0% - 483% 120% - 716% Expected dividend yield - - Risk-free interest rate 0.51% - 1.45% 0.18% - 0.84% |
Schedule of estimated fair values of liabilities measured on a recurring basis | October 31, 2017 Level 1 Level 2 Level 3 Total Promissory Note Issued August 22, 2014 $ - $ - $ 1,700 $ 1,700 Promissory Notes Issued in fiscal year 2017 - - 1,570,820 1,570,820 Promissory Notes Issued in fiscal year 2018 - - 1,144,171 1,144,171 Total liabilities $ - $ - $ 2,716,691 $ 2,716,691 |
Schedule of changes in derivative liabilities | Fair Value Measurements Using Significant Observable Inputs (Level 3) Balance - January 31, 2017 $ 2,088,684 Addition of new derivatives recognized as debt discounts 536,222 Addition of new derivatives recognized as loss on derivatives 240,659 Derivatives settled upon conversion of debt and exercise of warrants (526,791 ) Loss on debt extinguishment (166,975 ) Loss on change in fair value of the derivative 544,892 Balance - October 31, 2017 $ 2,716,691 |
Schedule of loss on derivative liability | Nine Months Ended October 31, 2017 2016 Day one loss due to derivative liabilities on convertible notes $ 240,659 $ 778,989 (Gain) loss on change in fair value of the derivative liabilities 544,892 (528,002 ) Loss on change in the fair value of derivative liabilities $ 785,551 $ 250,987 |
EQUITY (Tables)
EQUITY (Tables) | 9 Months Ended |
Oct. 31, 2017 | |
Equity Tables | |
Schedule of stock options outstanding | Options Outstanding Weighted Average Shares Exercise Price Outstanding, January 31, 2017 9,100,000 $ 0.10 Granted - - Exercised - - Forfeited/canceled - - Outstanding, October 31, 2017 9,100,000 $ 0.10 |
Schedule of outstanding and exercisable stock options activity | Options Outstanding Options Exercisable Number of Shares Weighted Average Remaining Contractual life (in years) Weighted Average Exercise Price Number of Shares Weighted Average Exercise Price 9,100,000 2.00 $ 0.10 9,100,000 $ 0.10 |
DESCRIPTION OF BUSINESS (Detail
DESCRIPTION OF BUSINESS (Details Narrative) | 9 Months Ended |
Oct. 31, 2017 | |
Description Of Business Details Narrative | |
State of incorporation | Nevada |
Date of incorporation | Jan. 6, 2011 |
GOING CONCERN (Details Narrativ
GOING CONCERN (Details Narrative) - USD ($) | 9 Months Ended | |
Oct. 31, 2017 | Jan. 31, 2017 | |
Going Concern Details Narrative | ||
Accumulated deficit | $ (30,351,938) | $ (26,361,315) |
Stockholders' Deficit | (26,025,164) | $ (22,951,460) |
Working capital deficit | $ 10,040,325 |
SUMMARY OF SIGNIFICANT ACCOUN25
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Details) - USD ($) | Oct. 31, 2017 | Jan. 31, 2017 |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Marketable securities - available for sale | $ 48,000 | $ 102,300 |
Derivative liabilities | 2,716,691 | 2,088,684 |
Fair Value, Inputs, Level 1 [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Derivative liabilities | ||
Fair Value, Inputs, Level 1 [Member] | Fair Value, Measurements, Recurring [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Marketable securities - available for sale | 48,000 | 102,300 |
Derivative liabilities | ||
Fair Value, Inputs, Level 2 [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Derivative liabilities | ||
Fair Value, Inputs, Level 2 [Member] | Fair Value, Measurements, Recurring [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Marketable securities - available for sale | ||
Derivative liabilities | ||
Fair Value, Inputs, Level 3 [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Derivative liabilities | 2,716,691 | |
Fair Value, Inputs, Level 3 [Member] | Fair Value, Measurements, Recurring [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Marketable securities - available for sale | ||
Derivative liabilities | $ 2,716,691 | $ 2,088,684 |
DISCONTINUED OPERATIONS (Detail
DISCONTINUED OPERATIONS (Details) - USD ($) | 3 Months Ended | 9 Months Ended | ||
Oct. 31, 2017 | Oct. 31, 2016 | Oct. 31, 2017 | Oct. 31, 2016 | |
Operating expenses | ||||
Loss from discontinued operations | $ (33,759) | $ (58,134) | ||
Webrunner [Member] | Asset Purchase And Sale Agreement [Member] | ||||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | ||||
Revenue | 63,825 | 224,580 | ||
Operating expenses | ||||
General and administration | (52,914) | (148,704) | ||
Depreciation and amortization | (44,670) | (134,010) | ||
Loss from discontinued operations | $ (33,759) | $ (58,134) |
DISCONTINUED OPERATIONS (Deta27
DISCONTINUED OPERATIONS (Details Narrative) - USD ($) | 1 Months Ended | 12 Months Ended | |
Oct. 31, 2016 | Jan. 31, 2017 | Oct. 31, 2017 | |
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | |||
Gain on sales of assets | $ 111,467 | ||
Consideration receivable | $ 401,052 | ||
Webrunner [Member] | Asset Purchase And Sale Agreement [Member] | |||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | |||
Proceeds from sale of assets receivable in installments | $ 413,861 |
NOTES PAYABLE (Details)
NOTES PAYABLE (Details) - USD ($) | Oct. 31, 2017 | Jan. 31, 2017 |
Short-term Debt [Line Items] | ||
Total notes payable | $ 755,558 | $ 100,476 |
Less: debt discount and deferred financing fees | (206,059) | (1,546) |
Notes payable net of debt discount and deferred financing fees | 549,499 | 98,930 |
Less: current portion of notes payable | 549,499 | 98,930 |
Long-term notes payable | ||
Notes Payable Issuance Date October Thirty Two Thousand Fourteen [Member] | ||
Short-term Debt [Line Items] | ||
Total notes payable | 10,000 | 10,000 |
Notes Payable Issuance Date August Four Two Thousand Sixteen [Member] | ||
Short-term Debt [Line Items] | ||
Total notes payable | 25,000 | 25,000 |
Notes Payable Issuance Date September Thirty Two Thousand Sixteen [Member] | ||
Short-term Debt [Line Items] | ||
Total notes payable | 65,476 | |
Notes Payable Issuance Date March Ten Two Thousand Seventeen [Member] | ||
Short-term Debt [Line Items] | ||
Total notes payable | 99,561 | |
Notes Payable Issuance Date April Eleven Two Thousand Seventeen [Member] | ||
Short-term Debt [Line Items] | ||
Total notes payable | ||
Notes Payable Issuance Date May Sixteen Two Thousand Seventeen [Member] | ||
Short-term Debt [Line Items] | ||
Total notes payable | 48,681 | |
Notes Payable Issuance Date May Thirty Two Thousand Seventeen [Member] | ||
Short-term Debt [Line Items] | ||
Total notes payable | ||
Notes Payable Issuance Date July Ten Two Thousand Seventeen [Member] | ||
Short-term Debt [Line Items] | ||
Total notes payable | ||
Notes Payable Issuance Date July Twenty One Two Thousand Seventeen [Member] | ||
Short-term Debt [Line Items] | ||
Total notes payable | 108,342 | |
Notes Payable Issuance Date September FourrteenTwo Thousand Seventeen [Member] | ||
Short-term Debt [Line Items] | ||
Total notes payable | 128,187 | |
Notes Payable Issuance Date October Two Two Thousand Seventeen [Member] | ||
Short-term Debt [Line Items] | ||
Total notes payable | 197,554 | |
Notes Payable Issuance Date October Twenty Three Two Thousand Seventeen [Member] | ||
Short-term Debt [Line Items] | ||
Total notes payable | $ 138,233 |
NOTES PAYABLE (Details 1)
NOTES PAYABLE (Details 1) - USD ($) | Oct. 31, 2017 | Jan. 31, 2017 |
Short-term Debt [Line Items] | ||
Total notes payable | $ 577,182 | $ 773,599 |
Current portion of notes payable | 577,182 | 614,085 |
Long-term notes payable | 159,514 | |
Notes Payable Issuance Date April Twenty Three Two Thousand Fifteen [Member] | Notes Payable Related Party [Member] | ||
Short-term Debt [Line Items] | ||
Total notes payable | 226,250 | 231,250 |
Notes Payable Issuance Date December Twenty One Two Thousand Sixteen [Member] | Notes Payable Related Party [Member] | ||
Short-term Debt [Line Items] | ||
Total notes payable | $ 350,932 | $ 542,349 |
NOTES PAYABLE (Details Narrativ
NOTES PAYABLE (Details Narrative) - USD ($) | 9 Months Ended | |||
Oct. 31, 2017 | Oct. 31, 2016 | Jan. 31, 2017 | May 02, 2015 | |
Short-term Debt [Line Items] | ||||
Notes payable | $ 577,182 | $ 773,599 | ||
Amortization expense related to the debt discount and deferred financing fees | 205,497 | $ 0 | ||
Total borrowings on note payable | 1,064,514 | 147,050 | ||
Payment of notes payable | 819,441 | 11,161 | ||
Cash proceeds received from the note | 25,000 | |||
Notes discount and financing fee | (206,059) | $ (1,546) | ||
Notes payable related party [Member] | ||||
Short-term Debt [Line Items] | ||||
Total borrowings on note payable | 196,417 | $ 505,444 | ||
Notes Payable Issuance Date October Thirty Two Thousand Fourteen [Member] | ||||
Short-term Debt [Line Items] | ||||
Notes payable | 10,000 | |||
Notes Payable Related Party [Member] | Notes Payable Issuance Date December Twenty One Two Thousand Sixteen [Member] | ||||
Short-term Debt [Line Items] | ||||
Notes payable | 574,252 | |||
Principal and interest payments of notes | $ 191,417 | |||
Maturity date | Jun. 20, 2018 | |||
Interest rate per annum for 1st 12 months | 7.29% | |||
Interest rate per annum for 13 through 18 months | 3.25% | |||
Monthly principal and interest payments for a period of 18 months through June 20, 2018 | $ 226,985 | |||
Notes Payable Related Party [Member] | Notes Payable Issuance Date April Twenty Three Two Thousand Fifteen [Member] | Net D Consulting Inc [Member] | Asset Purchase And Sale Agreement [Member] | ||||
Short-term Debt [Line Items] | ||||
Notes payable | $ 350,000 | |||
Maturity date | Oct. 7, 2016 | |||
Payment of notes payable | $ 5,000 | |||
Prosperitas Capital, LLC [Member] | Notes Payable Issuance Date October Twenty Three Two Thousand Seventeen [Member] | ||||
Short-term Debt [Line Items] | ||||
Notes payable | 143,000 | |||
Principal and interest payments of notes | $ 1,589 | |||
Term of installment | 90 days | |||
Notes payable cash received | $ 98,105 | |||
Notes discount and financing fee | 44,895 | |||
Powerup Lending Group Ltd [Member] | Notes Payable Issuance Date October Two Two Thousand Seventeen [Member] | ||||
Short-term Debt [Line Items] | ||||
Notes payable | 240,500 | |||
Principal and interest payments of notes | $ 6,135 | |||
Term of installment description | Twice a week. | |||
Notes payable cash received | $ 181,300 | |||
Notes discount and financing fee | 59,200 | |||
Powerup Lending Group Ltd [Member] | Notes Payable Issuance Date July Ten Two Thousand Seventeen [Member] | ||||
Short-term Debt [Line Items] | ||||
Notes payable | 54,000 | |||
Principal and interest payments of notes | $ 600 | |||
Term of installment | 90 days | |||
Notes payable cash received | $ 39,200 | |||
Notes discount and financing fee | 14,800 | |||
Repayment of notes payable | 18,600 | |||
Powerup Lending Group Ltd [Member] | Notes Payable Issuance Date May Thirty Two Thousand Seventeen [Member] | ||||
Short-term Debt [Line Items] | ||||
Notes payable | 108,000 | |||
Principal and interest payments of notes | $ 4,286 | |||
Term of installment | 182 days | |||
Maturity date | Dec. 30, 2017 | |||
Notes payable cash received | $ 78,400 | |||
Notes discount and financing fee | 29,600 | |||
Repayment of notes payable | 35,142 | |||
Powerup Lending Group Ltd [Member] | Notes Payable Issuance Date April Eleven Two Thousand Seventeen [Member] | ||||
Short-term Debt [Line Items] | ||||
Notes payable | 156,250 | |||
Principal and interest payments of notes | $ 4,560 | |||
Term of installment | 238 days | |||
Maturity date | Dec. 5, 2017 | |||
Notes payable cash received | $ 122,500 | |||
Notes discount and financing fee | 33,750 | |||
Repayment of notes payable | 39,993 | |||
Powerup Lending Group Ltd [Member] | Notes Payable Issuance Date September Thirty Two Thousand Sixteen [Member] | ||||
Short-term Debt [Line Items] | ||||
Principal and interest payments of notes | $ 4,560 | |||
Term of installment | 238 days | |||
Maturity date | May 30, 2017 | |||
Notes payable cash received | $ 125,000 | |||
Payment of notes payable | 122,050 | |||
Notes discount and financing fee | 2,950 | |||
Repayment of notes payable | 65,476 | |||
Richmond Capital Group [Member] | Notes Payable Issuance Date September ForteenTwo Thousand Seventeen [Member] | ||||
Short-term Debt [Line Items] | ||||
Principal and interest payments of notes | $ 1,459 | |||
Term of installment | 120 days | |||
Richmond Capital Group [Member] | Notes Payable Issuance Date September FourteenTwo Thousand Seventeen [Member] | ||||
Short-term Debt [Line Items] | ||||
Notes payable | $ 174,875 | |||
Notes payable cash received | 120,002 | |||
Notes discount and financing fee | 54,873 | |||
PIRS Capital, LLC [Member] | Notes Payable Issuance Date July Twenty One Two Thousand Seventeen [Member] | ||||
Short-term Debt [Line Items] | ||||
Notes payable | 170,000 | |||
Principal and interest payments of notes | $ 4,404 | |||
Term of installment | 273 days | |||
Maturity date | Apr. 20, 2018 | |||
Notes payable cash received | $ 122,101 | |||
Notes discount and financing fee | 47,899 | |||
PIRS Capital, LLC [Member] | Notes Payable Issuance Date March Ten Two Thousand Seventeen [Member] | ||||
Short-term Debt [Line Items] | ||||
Notes payable | 291,900 | |||
Principal and interest payments of notes | $ 5,657 | |||
Term of installment | 357 days | |||
Maturity date | Feb. 23, 2018 | |||
Notes payable cash received | $ 205,401 | |||
Notes discount and financing fee | 86,499 | |||
Arcarius LLC [Member] | Notes Payable Issuance Date May Sixteen Two Thousand Seventeen [Member] | ||||
Short-term Debt [Line Items] | ||||
Notes payable | 136,000 | |||
Principal and interest payments of notes | $ 773 | |||
Term of installment | 176 days | |||
Notes payable cash received | $ 97,505 | |||
Notes discount and financing fee | $ 38,495 | |||
Mr Knudson [Member] | Notes Payable Issuance Date August Four Two Thousand Sixteen [Member] | ||||
Short-term Debt [Line Items] | ||||
Interest rate per annum | 15.00% | |||
Number of convertible common shares | 250,000 | |||
Maturity date | Feb. 28, 2017 | |||
Cash proceeds received from the note | $ 25,000 |
CONVERTIBLE NOTES PAYABLE (Deta
CONVERTIBLE NOTES PAYABLE (Details) - USD ($) | Oct. 31, 2017 | Jan. 31, 2017 |
Short-term Debt [Line Items] | ||
Total convertible notes payable | $ 3,089,377 | $ 2,660,742 |
Less: debt discount and deferred financing fees | (598,790) | |
Total convertible notes payable after debt discount and deferred financing fees | 3,089,377 | 2,061,952 |
Less: current portion of convertible notes payable | 3,089,377 | 2,061,952 |
Long-term convertible notes payable | ||
Promissory Note Issued On August 22 2014 [Member] | Promissory Note | ||
Short-term Debt [Line Items] | ||
Total convertible notes payable | 1,700,000 | 1,700,000 |
Promissory Notes Issued In Fiscal Year 2016 [Member] | Promissory Note | ||
Short-term Debt [Line Items] | ||
Total convertible notes payable | 83,951 | |
Promissory Notes Issued In Fiscal Year 2017 [Member] | Promissory Note | ||
Short-term Debt [Line Items] | ||
Total convertible notes payable | 588,728 | 876,791 |
Promissory Notes Issued In Fiscal Year 2018 [Member] | Promissory Note | ||
Short-term Debt [Line Items] | ||
Total convertible notes payable | $ 800,649 |
CONVERTIBLE NOTES PAYABLE (De32
CONVERTIBLE NOTES PAYABLE (Details Narrative) | 1 Months Ended | 3 Months Ended | 9 Months Ended | 12 Months Ended | ||||
Dec. 31, 2015USD ($) | May 31, 2015USD ($) | Oct. 31, 2017USD ($) | Oct. 31, 2017USD ($)shares | Oct. 31, 2016USD ($) | Jan. 31, 2017USD ($)Integer | Jan. 31, 2016USD ($) | Jan. 31, 2014USD ($)$ / sharesshares | |
Short-term Debt [Line Items] | ||||||||
Derivative liability | $ 2,716,691 | $ 2,716,691 | $ 2,088,684 | |||||
Cash received | 1,064,514 | $ 147,050 | ||||||
Derivative loss | 240,659 | 778,989 | ||||||
Debt discount on convertible debenture | 0 | 0 | $ (598,790) | |||||
Loss on settlement of debt | (166,975) | |||||||
Amortization expense | $ 1,155,612 | 835,664 | ||||||
Conversion [Member] | ||||||||
Short-term Debt [Line Items] | ||||||||
Number of common shares issued under debt conversion | shares | 3,985,956,874 | |||||||
Derivative liability | 526,791 | $ 526,791 | ||||||
Accrued interest | 13,962 | 13,962 | ||||||
Principal amount of Promissory note | 200,566 | 200,566 | ||||||
Replacement of Notes [Member] | ||||||||
Short-term Debt [Line Items] | ||||||||
Number of Assigned notes | Integer | 16 | |||||||
Loss on settlement of debt | $ 267,646 | |||||||
Gain on settlement of debt | 166,975 | |||||||
Prepayment penalties | 156,809 | |||||||
Principal amounts of convertible notes payable related two lenders | $ 424,178 | |||||||
Promissory Notes Issued In Fiscal Year 2018 [Member] | ||||||||
Short-term Debt [Line Items] | ||||||||
Derivative liability | 1,144,171 | $ 1,144,171 | ||||||
Promissory Notes Issued In Fiscal Year 2018 [Member] | Promissory Note | ||||||||
Short-term Debt [Line Items] | ||||||||
Debt conversion description | Conversion prices are typically based on the discounted (40% to 50% discount) lowest trading prices of the Companys shares during various periods prior to conversion. | |||||||
Debt instrument, redemption, description | the Company to redeem the notes at rates ranging from 120% to 150% depending on the redemption date provided that no redemption is allowed after the 180 th | |||||||
Convertible notes payable, term | 9 months to 12 months | |||||||
Derivative liability | 1,254,497 | $ 1,254,497 | ||||||
Cash received | 144,500 | |||||||
Derivative loss | 240,659 | |||||||
Debt discount on convertible debenture | 536,222 | 536,222 | ||||||
Loss on settlement of debt | 166,975 | |||||||
Debt instrument original debt discount | 20,600 | 20,600 | ||||||
Fair value of derivative liabilities | 644,591 | 644,591 | ||||||
Accrued interest | $ 283,063 | $ 283,063 | ||||||
Promissory Notes Issued In Fiscal Year 2018 [Member] | Promissory Note | Minimum [Member] | ||||||||
Short-term Debt [Line Items] | ||||||||
Interest rate per annum | 10.00% | 10.00% | ||||||
Promissory Notes Issued In Fiscal Year 2018 [Member] | Promissory Note | Maximum [Member] | ||||||||
Short-term Debt [Line Items] | ||||||||
Interest rate per annum | 12.00% | 12.00% | ||||||
Promissory Notes Issued In Fiscal Year 2017 [Member] | ||||||||
Short-term Debt [Line Items] | ||||||||
Derivative liability | $ 1,570,820 | $ 1,570,820 | ||||||
Promissory Notes Issued In Fiscal Year 2017 [Member] | Promissory Note | ||||||||
Short-term Debt [Line Items] | ||||||||
Debt conversion description | 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 a floor of $0.0005 and $0.00005 per share. | |||||||
Debt instrument, redemption, description | 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 | |||||||
Convertible notes payable, term | 9 months to 20 months | |||||||
Derivative liability | $ 3,245,991 | |||||||
Cash received | 785,858 | |||||||
Derivative loss | 1,889,299 | |||||||
Debt discount on convertible debenture | 1,356,692 | |||||||
Deferred financing fees | 146,976 | |||||||
Accrued interest | 5,517 | |||||||
Principal amount of Promissory note | 1,266,417 | |||||||
Prepayment of promissory notes paid by cash | $ 33,333 | |||||||
Promissory Notes Issued In Fiscal Year 2017 [Member] | Promissory Note | Minimum [Member] | ||||||||
Short-term Debt [Line Items] | ||||||||
Interest rate per annum | 8.00% | |||||||
Promissory Notes Issued In Fiscal Year 2017 [Member] | Promissory Note | Maximum [Member] | ||||||||
Short-term Debt [Line Items] | ||||||||
Interest rate per annum | 12.00% | |||||||
Issued In Fiscal Year 2016 [Member] | Promissory Note | ||||||||
Short-term Debt [Line Items] | ||||||||
Debt conversion description | 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 | |||||||
Debt instrument, redemption, description | 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 | |||||||
Convertible notes payable, term | 9 months to 2 years | |||||||
Derivative liability | $ 459,733 | |||||||
Derivative loss | 250,733 | |||||||
Debt discount on convertible debenture | 209,000 | |||||||
Debt instrument original debt discount | 24,166 | |||||||
Deferred financing fees | 55,142 | |||||||
Principal amount of Promissory note | $ 449,666 | |||||||
Issued In Fiscal Year 2016 [Member] | Promissory Note | Minimum [Member] | ||||||||
Short-term Debt [Line Items] | ||||||||
Interest rate per annum | 5.00% | |||||||
Issued In Fiscal Year 2016 [Member] | Promissory Note | Maximum [Member] | ||||||||
Short-term Debt [Line Items] | ||||||||
Interest rate per annum | 12.00% | |||||||
Promissory Note - August 22, 2014 [Member] | Promissory Note | ||||||||
Short-term Debt [Line Items] | ||||||||
Derivative liability | $ 1,700,000 | |||||||
Beneficial Conversion feature | $ 358,200 | |||||||
Promissory Note - August 22, 2014 [Member] | Promissory Note | Doyle Knudson [member] | ||||||||
Short-term Debt [Line Items] | ||||||||
Convertible promissory note, issued | $ 1,800,000 | |||||||
Conversion price | $ / shares | $ 0.10 | |||||||
Debt transferred to another lender | $ 100,000 | $ 100,000 | ||||||
Number of common shares issued under debt conversion | shares | 18,000,000 | |||||||
Interest rate per annum | 10.00% | |||||||
Notes in Default [Member] | Promissory Note | ||||||||
Short-term Debt [Line Items] | ||||||||
Debt conversion description | The Conversion Price discount for certain notes shall be permanently increased by 10% | |||||||
Penalty interest | $ 15,050 | $ 348,879 | $ 0 | |||||
Notes in Default [Member] | Promissory Note | Minimum [Member] | ||||||||
Short-term Debt [Line Items] | ||||||||
Interest rate per annum | 20.00% | 20.00% | ||||||
Notes in Default [Member] | Promissory Note | Maximum [Member] | ||||||||
Short-term Debt [Line Items] | ||||||||
Interest rate per annum | 24.00% | 24.00% |
DERIVATIVE LIABILITIES (Details
DERIVATIVE LIABILITIES (Details) | 9 Months Ended | 12 Months Ended |
Oct. 31, 2017 | Jan. 31, 2017 | |
Expected dividend yield | ||
Minimum [Member] | ||
Expected term | 4 days | 0 years |
Expected average volatility | 0.00% | 120.00% |
Risk-free interest rate | 0.51% | 0.18% |
Maximum [Member] | ||
Expected term | 10 months 17 days | 1 year 6 months |
Expected average volatility | 483.00% | 716.00% |
Risk-free interest rate | 1.45% | 0.84% |
DERIVATIVE LIABILITIES (Detai34
DERIVATIVE LIABILITIES (Details 1) - USD ($) | Oct. 31, 2017 | Jan. 31, 2017 |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Derivative liability | $ 2,716,691 | $ 2,088,684 |
Promissory Note Issued On August 22 2014 [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Derivative liability | 1,700 | |
Promissory Notes Issued In Fiscal Year 2017 [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Derivative liability | 1,570,820 | |
Promissory Notes Issued In Fiscal Year 2018 [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Derivative liability | 1,144,171 | |
Fair Value, Inputs, Level 1 [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Derivative liability | ||
Fair Value, Inputs, Level 1 [Member] | Promissory Note Issued On August 22 2014 [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Derivative liability | ||
Fair Value, Inputs, Level 1 [Member] | Promissory Notes Issued In Fiscal Year 2017 [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Derivative liability | ||
Fair Value, Inputs, Level 1 [Member] | Promissory Notes Issued In Fiscal Year 2018 [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Derivative liability | ||
Fair Value, Inputs, Level 2 [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Derivative liability | ||
Fair Value, Inputs, Level 2 [Member] | Promissory Note Issued On August 22 2014 [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Derivative liability | ||
Fair Value, Inputs, Level 2 [Member] | Promissory Notes Issued In Fiscal Year 2017 [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Derivative liability | ||
Fair Value, Inputs, Level 2 [Member] | Promissory Notes Issued In Fiscal Year 2018 [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Derivative liability | ||
Fair Value, Inputs, Level 3 [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Derivative liability | 2,716,691 | |
Fair Value, Inputs, Level 3 [Member] | Promissory Note Issued On August 22 2014 [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Derivative liability | 1,700 | |
Fair Value, Inputs, Level 3 [Member] | Promissory Notes Issued In Fiscal Year 2017 [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Derivative liability | 1,570,820 | |
Fair Value, Inputs, Level 3 [Member] | Promissory Notes Issued In Fiscal Year 2018 [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Derivative liability | $ 1,144,171 |
DERIVATIVE LIABILITIES (Detai35
DERIVATIVE LIABILITIES (Details 2) - USD ($) | 9 Months Ended | |
Oct. 31, 2017 | Oct. 31, 2016 | |
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward] | ||
Balance - January 31, 2017 | $ 2,088,684 | |
Addition of new derivatives recognized as debt discounts | 536,222 | |
Addition of new derivatives recognized as loss on derivatives | 240,659 | $ 778,989 |
Derivatives settled upon conversion of debt and exercise of warrants | (526,791) | |
Loss on debt extinguishment | (166,975) | |
Loss on change in fair value of the derivative | 544,892 | $ (528,002) |
Balance - October 31, 2017 | $ 2,716,691 |
DERIVATIVE LIABILITIES (Detai36
DERIVATIVE LIABILITIES (Details 3) - USD ($) | 3 Months Ended | 9 Months Ended | ||
Oct. 31, 2017 | Oct. 31, 2016 | Oct. 31, 2017 | Oct. 31, 2016 | |
Derivative Liabilities Details 3 | ||||
Day one loss due to derivative liabilities on convertible notes | $ 240,659 | $ 778,989 | ||
(Gain) loss on change in fair value of the derivative liabilities | 544,892 | (528,002) | ||
Loss on change in the fair value of derivative liabilities | $ 752,196 | $ 149,358 | $ 785,551 | $ 250,987 |
EQUITY (Details)
EQUITY (Details) | 9 Months Ended |
Oct. 31, 2017$ / sharesshares | |
Options Outstanding, Shares | |
Outstanding, Beginning | shares | 9,100,000 |
Granted | shares | |
Exercised | shares | |
Forfeited/canceled | shares | |
Outstanding, ending | shares | 9,100,000 |
Options Outstanding, Weighted Average Exercise Price | |
Outstanding, Beginning | $ / shares | $ 0.10 |
Granted | $ / shares | |
Exercised | $ / shares | |
Forfeited/canceled | $ / shares | |
Outstanding, ending | $ / shares | $ 0.10 |
EQUITY (Details 1)
EQUITY (Details 1) - Weighted Average Exercise Price 0.10 [Member] | 9 Months Ended |
Oct. 31, 2017$ / sharesshares | |
Options Exercisable, Number of Shares | shares | 9,100,000 |
Options Exercisable, Weighted Average Remaining Contractual life (in years) | 2 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 |
EQUITY (Details Narrative)
EQUITY (Details Narrative) - USD ($) | 1 Months Ended | 9 Months Ended | ||
Jun. 26, 2016 | Oct. 31, 2017 | Oct. 31, 2016 | Jan. 31, 2017 | |
Common stock, par value | $ 0.001 | $ 0.001 | ||
Common stock, shares authorized | 14,900,000,000 | 14,900,000,000 | ||
Common stock, shares issued | 6,342,546,507 | 6,342,546,507 | ||
Common stock, shares outstanding | 2,357,089,633 | 2,357,089,633 | ||
Acquisition of stock option issued | 9,100,000 | 9,100,000 | ||
Stock-based compensation | $ 174,000 | $ 221,913 | ||
Series B Preferred Stock [Member] | ||||
Preferred stock, shares issued | 68,187,500 | 68,187,500 | ||
Preferred stock, shares outstanding | 68,187,500 | 68,187,500 | ||
Series D Convertible Preferred Stock [Member] | ||||
Preferred stock, shares issued | 21 | 21 | ||
Preferred stock, shares outstanding | 21 | 21 | ||
Webrunner [Member] | ||||
Acquisition of stock option issued | 9,100,000 | |||
Series C Convertible Preferred Stock [Member] | ||||
Preferred stock, shares issued | 16 | 16 | ||
Preferred stock, shares outstanding | 16 | 16 | ||
Series A Preferred Stock [Member] | ||||
Preferred stock, shares issued | 1,000 | 1,000 | ||
Preferred stock, shares outstanding | 1,000 | 1,000 | ||
Common Stock [Member] | ||||
Number of common shares issued under debt conversion | 3,985,956,874 | |||
Employee Incentive Bonus Plan [Member] | First Award [Member] | ||||
Description employee incentive bonus plan | 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. | |||
Employee Incentive Bonus Plan [Member] | First Award [Member] | Series B Preferred Stock [Member] | ||||
Cash compensation awarded per month | $ 10,000 | |||
Revenues generated | $ 1,000,000 | |||
Number of shares earned as part of award shares | 500,000 | |||
Fair value of shares earned as part of award | $ 2,500 | |||
Employee Incentive Bonus Plan [Member] | Second Award [Member] | ||||
Description employee incentive bonus plan | 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. | |||
Employee Incentive Bonus Plan [Member] | Second Award [Member] | Series B Preferred Stock [Member] | ||||
Revenues generated | $ 1,000,000 | |||
Number of shares earned as part of award shares | 6,500,000 | |||
Additional number of shares earned as part of award shares | 3,000,000 | |||
Fair value of shares earned as part of award | $ 32,500 | |||
Employee Incentive Bonus Plan [Member] | Second Award [Member] | Series B Preferred Stock [Member] | Maximum [Member] | ||||
Revenues generated | 7,000,000 | |||
Employee Incentive Bonus Plan [Member] | Second Award [Member] | Series D Convertible Preferred Stock [Member] | ||||
Cash compensation awarded per month | 20,000 | |||
Revenues generated | $ 100,000 | |||
Number of shares earned as part of award shares | 5 | |||
Fair value of shares earned as part of award | $ 500,000 | |||
Common Stock [Member] | ||||
Accrued interest | $ 214,528 |
RELATED PARTY TRANSACTIONS (Det
RELATED PARTY TRANSACTIONS (Details Narrative) - USD ($) | 9 Months Ended | |
Oct. 31, 2017 | Jan. 31, 2017 | |
Amount owed by officer | $ 179,790 | $ 0 |
Total notes payable | 577,182 | 773,599 |
Total services fees | 222,478 | |
Outstanding note payable | 189,533 | $ 305,458 |
Officer [Member] | ||
Consulting fees payment | $ 179,850 |