Document and Entity Information
Document and Entity Information - shares | 9 Months Ended | |
Sep. 30, 2017 | Jan. 31, 2018 | |
Document And Entity Information | ||
Entity Registrant Name | Blow & Drive Interlock Corp | |
Entity Central Index Key | 1,586,495 | |
Document Type | 10-Q/A | |
Document Period End Date | Sep. 30, 2017 | |
Amendment Flag | true | |
Amendment Description | We are filing this Amendment No. 1 on Form 10-Q/A (the Amendment) to our Quarterly Report on Form 10-Q for the period ended September 30, 2017 (the Form 10-Q), filed with the United States Securities and Exchange Commission on February 9, 2018 (the Original Filing Date), solely to correct an error in our financial statements for this period. In our filings in 2016 we had mistakenly recognized the entire upfront fees from two of our independent distributors ($10,000 in Q2 2016 and $50,000 in Q3 2016) as revenue at the time we delivered the exclusive license to the distributor rather than over the term of the agreement. To correct this error, in the financial statements included with this Amendment we show the portion of the upfront fees attributable to this period. In order to correct these errors we have included restated financial statements, notes to financial statements, and amended management disclosure and analysis related to the restated financial statements with this Amendment. The adjustments to the financial statements are indicated in our restated financial statements filed herewith. No other changes have been made to the Form 10-Q. All other portions of this Amendment speaks as of the Original Filing Date and do not reflect events that may have occurred subsequent to the Original Filing Date, and does not modify or update in any way the disclosures made in the Form 10-Q. | |
Current Fiscal Year End Date | --12-31 | |
Entity Filer Category | Smaller Reporting Company | |
Entity Common Stock, Shares Outstanding | 25,201,266 | |
Trading Symbol | BDIC | |
Document Fiscal Period Focus | Q3 | |
Document Fiscal Year Focus | 2,017 |
Consolidated Balance Sheet
Consolidated Balance Sheet - USD ($) | Sep. 30, 2017 | Dec. 31, 2016 |
Current Assets | ||
Cash | $ 84,370 | $ 116,309 |
Accounts receivable, net | 39,069 | 51,241 |
Prepaid Expenses | 1,569 | 2,361 |
Inventories | 10,650 | 10,650 |
Total Current Assets | 135,658 | 180,561 |
Other Assets | ||
Deposits | 5,131 | 256,254 |
Furniture and equipment | 925,728 | 356,346 |
Total Assets | 1,066,517 | 793,161 |
Current Liabilities | ||
Accounts payable | 102,791 | 28,250 |
Accrued expenses | 235,398 | 68,795 |
Accrued royalty payable | 145,317 | |
Accrued interest | 41,078 | 10,110 |
Income taxes payable | 5,929 | 5,700 |
Deferred revenue | 98,057 | 162,331 |
Derivative liability | 62,537 | 73,556 |
Notes payable, net of debt discount of $22,431 and $15,018 at September 30, 2017 and December 31, 2016, respectively | 154,069 | 125,351 |
Notes payable - related party, current portion | 49,396 | |
Convertible notes payable, net of debt discount of $3,115 and $23,724 at September 30, 2017 and December 31, 2016, respectively | 54,385 | 33,775 |
Royalty notes payable, net of debt discount of $29,393 and $87,036 at September 30, 2017 and December 31, 2016, respectively | 892 | 29,742 |
Total Current Liabilities | 900,453 | 587,006 |
Long term liabilities | ||
Notes payable, net of debt discount of $46,750 and $32,292 at September 30, 2017 and December 31, 2016, respectively | 148,250 | 17,708 |
Notes payable - related party | 48,353 | |
Royalty notes payable, net of debt discount of $353,894 and $574,294 at September 30, 2017 and December 31, 2016, respectively | 163,106 | 8,778 |
Accrued royalties payable | 1,786 | 121,967 |
Total Liabilities | 1,213,595 | 783,812 |
Stockholders' Equity (Deficit) | ||
Preferred stock, $0.001 par value, 20,000,000 shares authorized, 1,000,000 and 0 shares issued or issuable at September 30, 2017 and December 31, 2016, respectively | 1,000 | |
Common stock, $0.0001 par value, 100,000,000 shares authorized, 24,057,961 and 19,575,605 shares issued or issuable at September 30, 2017 and December 31, 2016, respectively. | 2,406 | 1,958 |
Additional paid-in capital | 2,696,281 | 1,594,721 |
Accumulated deficit | (2,846,765) | (1,587,330) |
Total Stockholder's Equity (Deficit) | (147,078) | 9,349 |
Total Liabilities and Stockholders' Equity (Deficit) | 1,066,517 | 793,161 |
As Filed [Member] | ||
Current Assets | ||
Cash | 84,370 | $ 116,309 |
Accounts receivable, net | 39,069 | |
Prepaid Expenses | 1,569 | |
Inventories | 10,650 | |
Total Current Assets | 135,658 | |
Other Assets | ||
Deposits | 5,131 | |
Furniture and equipment | 925,728 | |
Total Assets | 1,066,517 | |
Current Liabilities | ||
Accounts payable | 102,791 | |
Accrued expenses | 235,398 | |
Accrued royalty payable | 145,317 | |
Accrued interest | 41,078 | |
Income taxes payable | 5,929 | |
Deferred revenue | 91,057 | |
Derivative liability | 62,537 | |
Notes payable, net of debt discount of $22,431 and $15,018 at September 30, 2017 and December 31, 2016, respectively | 154,069 | |
Notes payable - related party, current portion | ||
Convertible notes payable, net of debt discount of $3,115 and $23,724 at September 30, 2017 and December 31, 2016, respectively | 54,385 | |
Royalty notes payable, net of debt discount of $29,393 and $87,036 at September 30, 2017 and December 31, 2016, respectively | 892 | |
Total Current Liabilities | 893,453 | |
Long term liabilities | ||
Notes payable, net of debt discount of $46,750 and $32,292 at September 30, 2017 and December 31, 2016, respectively | 148,250 | |
Notes payable - related party | ||
Royalty notes payable, net of debt discount of $353,894 and $574,294 at September 30, 2017 and December 31, 2016, respectively | 163,106 | |
Accrued royalties payable | 1,786 | |
Total Liabilities | 1,206,595 | |
Stockholders' Equity (Deficit) | ||
Preferred stock, $0.001 par value, 20,000,000 shares authorized, 1,000,000 and 0 shares issued or issuable at September 30, 2017 and December 31, 2016, respectively | 1,000 | |
Common stock, $0.0001 par value, 100,000,000 shares authorized, 24,057,961 and 19,575,605 shares issued or issuable at September 30, 2017 and December 31, 2016, respectively. | 2,406 | |
Additional paid-in capital | 2,696,281 | |
Accumulated deficit | (2,839,765) | |
Total Stockholder's Equity (Deficit) | (140,078) | |
Total Liabilities and Stockholders' Equity (Deficit) | 1,066,517 | |
Restatement Adjustment [Member] | ||
Current Assets | ||
Cash | ||
Total Current Assets | 0 | |
Other Assets | ||
Total Assets | 0 | |
Current Liabilities | ||
Deferred revenue | 7,000 | |
Total Current Liabilities | 7,000 | |
Long term liabilities | ||
Total Liabilities | 7,000 | |
Stockholders' Equity (Deficit) | ||
Accumulated deficit | (7,000) | |
Total Stockholder's Equity (Deficit) | (7,000) | |
Total Liabilities and Stockholders' Equity (Deficit) | $ 0 |
Consolidated Balance Sheet (Par
Consolidated Balance Sheet (Parenthetical) - USD ($) | Sep. 30, 2017 | Dec. 31, 2016 |
Statement of Financial Position [Abstract] | ||
Notes payable, debt discount current | $ 22,431 | $ 15,018 |
Convertible notes payable, debt discount current | 3,115 | 23,724 |
Royalty notes payable, debt discount current | 29,393 | 87,036 |
Notes payable, debt discount noncurrent | 46,750 | 32,292 |
Royalty notes payable, debt discount noncurrent | $ 353,894 | $ 574,294 |
Preferred stock, par value | $ 0.001 | $ 0.001 |
Preferred stock, shares authorized | 20,000,000 | 20,000,000 |
Preferred stock, shares issued | 1,000,000 | 0 |
Common stock, par value | $ 0.0001 | $ 0.0001 |
Common stock, shares authorized | 100,000,000 | 100,000,000 |
Common stock, shares issued | 24,057,961 | 19,575,605 |
Consolidated Statements of Oper
Consolidated Statements of Operations (Unaudited) - USD ($) | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2017 | Sep. 30, 2016 | Sep. 30, 2017 | Sep. 30, 2016 | |
Monitoring revenue | $ 394,139 | $ 80,983 | $ 674,197 | $ 200,188 |
Distributorship revenue | 85,276 | 13,275 | 286,729 | 19,225 |
Total revenue | 479,415 | 94,258 | 960,926 | 219,413 |
Monitoring cost of revenue | 57,817 | 8,899 | 111,884 | 26,617 |
Distributorship cost of revenue | 1,000 | 7,739 | ||
Total cost of revenue | 58,817 | 8,899 | 119,623 | 26,617 |
Gross profit | 420,598 | 85,359 | 841,303 | 192,796 |
Operating expenses | ||||
Payroll | 272,900 | 30,739 | 457,288 | 95,986 |
Professional fees | 16,603 | 4,266 | 93,505 | 65,887 |
General and administrative expenses | 269,039 | 115,868 | 579,172 | 341,827 |
Depreciation | 90,512 | 16,041 | 234,654 | 32,971 |
Total operating expenses | 649,054 | 166,914 | 1,364,619 | 536,671 |
Loss from operations | (228,456) | (81,555) | (523,316) | (343,875) |
Other income (expense) | ||||
Interest expense | (145,740) | (41,789) | (440,538) | (111,714) |
Change in fair value of derivative liability | (6,474) | 16,814 | 11,018 | (2,798) |
Loss on extinguishment of debt | (116,541) | (305,000) | (116,541) | |
Total other income (expense) | (152,214) | (141,516) | (734,520) | (231,053) |
Loss before provision for income taxes | (380,670) | (223,071) | (1,257,836) | (574,928) |
Provision for income taxes | 1,600 | |||
Net loss | $ (380,670) | $ (223,071) | $ (1,259,436) | $ (574,928) |
Basic and diluted loss per common share | $ (0.02) | $ (0.01) | $ (0.06) | $ (0.04) |
Weighted average number of common shares outstanding - basic and diluted | 22,856,861 | 16,333,870 | 21,922,340 | 15,646,423 |
As Filed [Member] | ||||
Monitoring revenue | $ 394,139 | $ 674,197 | ||
Distributorship revenue | 42,276 | 237,729 | ||
Total revenue | 436,415 | 911,926 | ||
Monitoring cost of revenue | 57,817 | 111,884 | ||
Distributorship cost of revenue | 1,000 | 7,739 | ||
Total cost of revenue | 58,817 | 119,623 | ||
Gross profit | 377,598 | 792,303 | ||
Operating expenses | ||||
Payroll | 272,900 | 457,288 | ||
Professional fees | 16,603 | 93,505 | ||
General and administrative expenses | 269,039 | 579,172 | ||
Depreciation | 90,512 | 234,654 | ||
Total operating expenses | 649,054 | 1,364,619 | ||
Loss from operations | (271,456) | (572,316) | ||
Other income (expense) | ||||
Interest expense | (145,740) | (440,538) | ||
Change in fair value of derivative liability | (6,474) | 11,018 | ||
Loss on extinguishment of debt | (305,000) | |||
Total other income (expense) | (152,214) | (734,520) | ||
Loss before provision for income taxes | (423,670) | (1,306,836) | ||
Provision for income taxes | 1,600 | |||
Net loss | $ (423,670) | $ (1,308,436) | ||
Basic and diluted loss per common share | $ (0.02) | $ (0.06) | ||
Weighted average number of common shares outstanding - basic and diluted | 22,856,861 | 21,922,340 | ||
Restatement Adjustment [Member] | ||||
Distributorship revenue | $ 43,000 | $ 49,000 | ||
Total revenue | 43,000 | 49,000 | ||
Total cost of revenue | ||||
Gross profit | 43,000 | 49,000 | ||
Operating expenses | ||||
Total operating expenses | ||||
Loss from operations | 43,000 | 49,000 | ||
Other income (expense) | ||||
Total other income (expense) | ||||
Loss before provision for income taxes | 43,000 | 49,000 | ||
Net loss | $ 43,000 | $ 49,000 |
Consolidated Statement of Share
Consolidated Statement of Shareholders' Equity (Deficit) (Unaudited) - 9 months ended Sep. 30, 2017 - USD ($) | Preferred Stock [Member] | Common Stock [Member] | Additional Paid-in Capital [Member] | Accumulated Deficit [Member] | Restatement Adjustment [Member] | Restated Accumulated Deficit [Member] | Total |
Beginning Balance at Dec. 31, 2016 | $ 1,958 | $ 1,594,721 | $ (1,531,330) | $ (56,000) | $ (1,587,330) | $ 9,349 | |
Beginning Balance, shares at Dec. 31, 2016 | 19,575,605 | ||||||
Shares issued for services | $ 3 | 13,910 | 13,913 | ||||
Shares issued for services, shares | 27,180 | ||||||
Warrants issued for services | 278 | 278 | |||||
Shares issued related to debt | $ 1,000 | $ 19 | 434,700 | 435,719 | |||
Shares issued related to debt, shares | 1,000,000 | 195,400 | |||||
Shares issued for cash | $ 374 | 652,725 | 653,099 | ||||
Shares issued for cash, shares | 3,736,894 | ||||||
Shares issued related to anti-dilution | $ 52 | (52) | |||||
Shares issued related to anti-dilution, shares | 522,882 | ||||||
Net loss | (1,308,436) | 49,000 | (1,259,436) | (1,259,436) | |||
Ending Balance at Sep. 30, 2017 | $ 1,000 | $ 2,406 | $ 2,696,282 | $ (2,839,766) | $ (7,000) | $ (2,846,766) | $ (147,078) |
Ending Balance, shares at Sep. 30, 2017 | 1,000,000 | 24,057,961 |
Consolidated Statement of Cash
Consolidated Statement of Cash Flows (Unaudited) - USD ($) | 9 Months Ended | |
Sep. 30, 2017 | Sep. 30, 2016 | |
Cash flows from operating activities: | ||
Net loss | $ (1,259,436) | $ (574,928) |
Adjustments to reconcile from net loss to net cash used in operating activities: | ||
Depreciation and amortization | 234,654 | 32,971 |
Loss on fixed assets disposals | 12,989 | |
Shares issued for services | 14,188 | 166,883 |
Allowance for doubtful accounts | 5,412 | |
Loss on extinguishment of debt | 305,000 | 116,541 |
Amortization of debt discount | 275,465 | 89,109 |
Change in fair value of derivative liability | (11,018) | 2,798 |
Changes in operating assets and liabilities | ||
Accounts receivable | 6,760 | (47,898) |
Prepaid expenses | 792 | (327) |
Deposits | 1,123 | (12,000) |
Accounts payable | 74,541 | 10,767 |
Accrued expenses | 193,409 | (8,397) |
Accrued interest | 30,968 | 1,452 |
Deferred revenue | (64,274) | 40,879 |
Net cash used in operating activities | (179,428) | (182,150) |
Cash flows from investing activities: | ||
Purchase of property and equipment | (817,026) | (176,433) |
Deposits on units | 250,000 | |
Net cash used in investing activities | (567,026) | (176,433) |
Cash flows from financing activities: | ||
Proceeds from notes payable | 195,400 | 471,199 |
Repayments of notes payable | (14,268) | (99,348) |
Repayments of royalty notes payable | (65,529) | |
Repayment of related party notes payable | (54,187) | |
Proceeds from issuance of common stock | 653,099 | 172,500 |
Net cash provided by financing activities | 714,515 | 544,351 |
Net increase (decrease) in cash | (31,939) | 185,768 |
Cash, beginning of period | 116,309 | 9,103 |
Cash, end of period | 84,370 | 194,871 |
Supplemental disclosure of cash information: | ||
Interest | 134,105 | 21,288 |
Income taxes | ||
Supplemental disclosure of non-cash investing and financing activities | ||
Common stock and warrants issued for services | 14,188 | 166,883 |
Establishment of debt discount for royalty notes | 120,000 | |
Preferred stock issued for debt reduction and services | 350,000 | |
As Filed [Member] | ||
Cash flows from operating activities: | ||
Net loss | (1,308,436) | |
Adjustments to reconcile from net loss to net cash used in operating activities: | ||
Depreciation and amortization | 234,654 | |
Loss on fixed assets disposals | 12,989 | |
Shares issued for services | 14,188 | |
Allowance for doubtful accounts | 5,412 | |
Loss on extinguishment of debt | 305,000 | |
Amortization of debt discount | 275,465 | |
Change in fair value of derivative liability | (11,018) | |
Changes in operating assets and liabilities | ||
Accounts receivable | 6,760 | |
Prepaid expenses | 792 | |
Deposits | 1,123 | |
Accounts payable | 74,541 | |
Accrued expenses | 193,409 | |
Accrued interest | 30,968 | |
Deferred revenue | (15,274) | |
Net cash used in operating activities | (179,428) | |
Cash flows from investing activities: | ||
Purchase of property and equipment | (817,026) | |
Deposits on units | 250,000 | |
Net cash used in investing activities | (567,026) | |
Cash flows from financing activities: | ||
Proceeds from notes payable | 195,400 | |
Repayments of notes payable | (14,268) | |
Repayments of royalty notes payable | (65,529) | |
Repayment of related party notes payable | (54,187) | |
Proceeds from issuance of common stock | 653,099 | |
Net cash provided by financing activities | 714,515 | |
Net increase (decrease) in cash | (31,939) | |
Cash, beginning of period | 116,309 | |
Cash, end of period | 84,370 | |
Supplemental disclosure of cash information: | ||
Interest | 134,105 | |
Income taxes | ||
Supplemental disclosure of non-cash investing and financing activities | ||
Common stock and warrants issued for services | 14,188 | |
Establishment of debt discount for royalty notes | ||
Preferred stock issued for debt reduction and services | 350,000 | |
Restatement Adjustment [Member] | ||
Cash flows from operating activities: | ||
Net loss | 49,000 | |
Changes in operating assets and liabilities | ||
Deferred revenue | (49,000) | |
Net cash used in operating activities | ||
Cash flows from investing activities: | ||
Net cash used in investing activities | ||
Cash flows from financing activities: | ||
Net cash provided by financing activities | ||
Net increase (decrease) in cash | ||
Cash, end of period |
Organization and Nature of Busi
Organization and Nature of Business | 9 Months Ended |
Sep. 30, 2017 | |
Accounting Policies [Abstract] | |
Organization and Nature of Business | Note 1 - Organization and Nature of Business Blow & Drive Interlock (“the Company”) was incorporated on July 2, 2013 under the laws of the State of Delaware to engage in any lawful corporate undertaking, including, but not limited to, selected mergers and acquisitions. The Company makes, markets and rents alcohol ignition interlock devices to DUI/DWI offenders as part of their mandatory court or motor vehicle department programs. The Company has approval for its device in the following states: California, Colorado, Kansas, New York, Tennessee, Arizona, Oregon, Kentucky, Oklahoma, Pennsylvania, and Texas. In 2015, The Company formed BDI Manufacturing, Inc., an Arizona corporation, which is a 100% wholly owned subsidiary of Blow & Drive Interlock Corporation. The Company makes, markets, installs and monitors a breath alcohol ignition interlock device (BAIID) called the BDI-747/1, which is a mechanism that is installed on the steering column of an automobile and into which a driver exhales. The device in turn provides a blood-alcohol concentration analysis. If the driver’s blood-alcohol content is higher than a certain pre-programmed limit, the device prevents the ignition from engaging and the automobile from starting. These devices are often required for use by DUI or DWI (“driving under the influence” or “driving while intoxicated”) offenders as part of a mandatory court or motor vehicle department program. The Company licenses the rights to third party distributors to promote the BDI-747/1 and provide services related to the device. The distributorships are for specific geographical areas (either entire states or certain counties within states). The Company currently has entered into six distributorship agreements. Under the distribution agreements the Company typically receives a onetime fee, and then is entitled to receive a per unit registration fee and a per unit monthly fee for each BDI-747/1 unit the distributor has in inventory or on the road beginning thirty (30) days after the distributor receives the unit. |
Basis of Presentation and Summa
Basis of Presentation and Summary of Significant Accounting Policies | 9 Months Ended |
Sep. 30, 2017 | |
Accounting Policies [Abstract] | |
Basis of Presentation and Summary of Significant Accounting Policies | Note 2 – Basis of Presentation and Summary of Significant Accounting Policies Basis of Presentation The accompanying consolidated financial statements have been prepared by the Company in accordance with generally accepted accounting principles in the United States of America, and pursuant to the rules and regulations of the Securities and Exchange Commission and reflect all adjustments, consisting of normal recurring adjustments, which management believes are necessary to fairly present the financial position, results of operations and cash flows of the Company. Going Concern The Company’s unaudited condensed consolidated financial statements are prepared using generally accepted accounting principles in the United States of America applicable to a going concern which contemplates the realization of assets and liquidation of liabilities in the normal course of business. The Company has not yet established an ongoing source of revenue sufficient to cover its operating costs and allow it to continue as a going concern. As of September 30, 2017, the Company had an accumulated deficit of $2,846,765 (restated). The ability of the Company to continue as a going concern is dependent on the Company obtaining adequate capital to fund operating losses until it becomes profitable. If the Company is unable to obtain adequate capital, it could be forced to cease or reduce its operations. In order to continue as a going concern, the Company will need, among other things, additional capital resources. The Company will continue to raise funds through the sale of its equity securities or issuance of notes payable to obtain additional operating capital. The Company is dependent upon its ability to, and will continue to attempt to, secure additional equity and/or debt financing until the Company can earn revenue and realize positive cash flow from its operations. There are no assurances that the Company will be successful in earning revenue and realizing positive cash flow from its operations. Without sufficient financing it would be unlikely that the Company will continue as a going concern. Based on the Company’s current rate of cash outflows, cash on hand and proceeds from the prior sale of equity securities and issuance of notes payable, management believes that its current cash will not be sufficient to meet the anticipated cash needs for working capital for the next 12 months. The Company’s plans with respect to its liquidity issues include, but are not limited to, the following: 1) Continue to issue restricted stock for compensation due to consultants and for its legacy accounts payable in lieu of cash payments; and 2) Seek additional capital to continue its operations as it rolls out its current products. The Company is currently evaluating additional debt or equity financing opportunities and may execute them when appropriate. However, there can be no assurances that the Company can consummate such a transaction, or consummate a transaction at favorable pricing. The ability of the Company to continue as a going concern is dependent upon its ability to successfully accomplish the plans described in the preceding paragraph and eventually secure other sources of financing and achieve profitable operations. These condensed consolidated financial statements do not include any adjustments relating to the recoverability and classification of recorded asset amounts, or amounts and classification of liabilities that might result from this uncertainty. Reclassifications Certain reclassifications have been made to amounts in prior periods to conform to the current period presentation. All reclassifications have been applied consistently to the periods presented. Use of Estimates The preparation of financial statements in conformity with U.S. generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenue and expenses during the reporting periods. Actual results could differ from those estimates. Revenue Recognition The Company recognizes revenue when earned and related costs of sales and expenses when incurred. The Company recognizes revenue in accordance with FASB ASC Topic 605-10-S99, Revenue Recognition, Overall, SEC Materials Monthly per unit fee revenue is earned and recognized over the term of the contract as support services are provided. Revenues from territory exclusivity are earned when there is persuasive evidence of an arrangement, delivery has occurred, the sales price has been determined and collectability has been reasonably assured. Accounts Receivable and Allowance for Doubtful Accounts The Company’s accounts receivable primarily consist of trade receivables. The Company records an allowance for doubtful accounts that is based on historical trends, customer knowledge, any known disputes, and the aging of the accounts receivable balances combined with management’s estimate of future potential recoverability. Receivables are written off against the allowance after all attempts to collect a receivable have failed. The Company believes its allowance for doubtful accounts as of September 30, 2017 and December 31, 2016 is adequate, but actual write-offs could exceed the recorded allowance. Inventories Inventories are valued at the first-in first-out method and at September 30, 2017 and December 31, 2016 consists of spare parts for the BDI 747 monitoring units. Convertible Debt and Warrants Issued with Convertible Debt Convertible debt is accounted for under the guidelines established by ASC 470, Debt with Conversion and Other Options Beneficial Conversion Features The Company calculates the fair value of warrants issued with the convertible instruments using the Black-Scholes valuation method, using the same assumptions used for valuing employee options for purposes of ASC 718, Compensation – Stock Compensation For modifications of convertible debt, the Company records a modification that changes the fair value of an embedded conversion feature, including a BCF, as a debt discount which is then amortized to interest expense over the remaining life of the debt. If modification is considered substantial (i.e. greater than 10% of the carrying value of the debt), an extinguishment of debt is deemed to have occurred, resulting in the recognition of an extinguishment gain or loss. Fair Value of Financial Instruments The Company utilizes ASC 820-10, Fair Value Measurement and Disclosure, for valuing financial assets and liabilities measured on a recurring basis. Fair value is defined as the exit price, or the amount that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants as of the measurement date. The guidance also establishes a hierarchy for inputs used in measuring fair value that maximizes the use of observable inputs and minimizes the use of unobservable inputs by requiring that the most observable inputs be used when available. Observable inputs are inputs market participants would use in valuing the asset or liability and are developed based on market data obtained from sources independent of the Company. Unobservable inputs are inputs that reflect the Company’s assumptions about the factors market participants would use in valuing the asset or liability. The guidance establishes three levels of inputs that may be used to measure fair value: Level 1. Observable inputs such as quoted prices in active markets; Level 2. Inputs, other than the quoted prices in active markets, that are observable either directly or indirectly; and Level 3. Unobservable inputs in which there is little or no market data, which require the reporting entity to develop its own assumptions. The table below describes the Company’s valuation of financial instruments using guidance from ASC 820-10: Fair Value Measurements Using Level 1 Level 2 Level 3 Balance December 31, 2016 $ - $ 73,556 $ - Change in fair value of derivative liability - (11,019 ) - Balance September 30, 2017 (unaudited) $ - $ 62,537 $ - Net Income (Loss) Per Share Basic earnings per share is calculated by dividing income available to common stockholders by the weighted-average number of common shares outstanding during each period. Diluted earnings per share is computed using the weighted average number of common and dilutive common share equivalents outstanding during the period. Stock Based Compensation The Company recognizes stock-based compensation in accordance with FASB ASC Topic 718 Stock Compensation For non-employee stock-based compensation, the Company applies FASB ASC Topic 505 Equity-Based Payments to Non-Employees Concentrations All of the parts for the Company’s ignition interlock devices are purchased from one supplier in China. The loss of this supplier could have a material impact on the Company’s ability to timely obtain additional units. The Company has multiple distributors as of September 30, 2017, and is actively engaging more in new markets. However, for the three and nine months ended September 30, 2017, one distributor, licensed in four states, makes up approximately 100% and 91% percent of all revenues from distributors, respectively, and 100% of accounts receivable at September 30, 2017. The loss of this distributer would have a material impact on the Company’s revenues. Per an agreement dated January 21, 2018 that memorialized a September 30, 2017 oral agreement, the Company and its largest distributor cancelled their distributorship agreement dated September 5, 2015. See Note 15 below. Income Taxes The Company accounts for its income taxes in accordance with Income Taxes Topic of the FASB ASC 740, which requires recognition of deferred tax assets and liabilities for future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases and tax credit carry forwards. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in operations in the period that includes the enactment date. The Company also follows ASC 740-10-25, which provides detailed guidance for the financial statement recognition, measurement and disclosure of uncertain tax positions recognized in an enterprise’s financial statements in accordance with ASC Topic 740, “ Accounting for Income Taxes” Derivative Liabilities The Company assessed the classification of its derivative financial instruments as of September 30, 2017, which consist of convertible instruments and rights to shares of the Company’s common stock, and determined that such derivatives meet the criteria for liability classification under ASC 815. ASC 815 generally provides three criteria that, if met, require companies to bifurcate conversion options from their host instruments and account for them as free-standing derivative financial instruments. These three criteria include circumstances in which (a) the economic characteristics and risks of the embedded derivative instrument are not clearly and closely related to the economic characteristics and risks of the host contract, (b) the hybrid instrument that embodies both the embedded derivative instrument and the host contract is not re-measured at fair value under otherwise applicable generally accepted accounting principles with changes in fair value reported in earnings as they occur and (c) a separate instrument with the same terms as the embedded derivative instrument would be considered a derivative instrument subject to the requirements of ASC 815. ASC 815 also provides an exception to this rule when the host instrument is deemed to be conventional, as defined. Convertible Instruments The Company evaluates and accounts for conversion options embedded in its convertible instruments in accordance with professional standards for “Accounting for Derivative Instruments and Hedging Activities”. ASC 815-40 provides that, among other things, generally, if an event is not within the entity’s control or could require net cash settlement, then the contract shall be classified as an asset or a liability. Recently Issued Accounting Pronouncements In September 2017, the Financial Accounting Standards Board (FASB) issued Accounting Standards Update (ASU) No. 2017-13, Revenue Recognition, Revenue from Contracts with Customers, Leases. In July 2017, the FASB issued Accounting Standards Update (ASU) No. 2017-11, Earnings Per Share; Distinguishing Liabilities from Equity; Derivatives and Hedging; Accounting for Certain Financial Instruments with Down Round Features; Replacement of the Indefinite Deferral for Mandatorily Redeemable Financial Instruments of Certain Nonpublic Entities and Certain Mandatorily Redeemable Noncontrolling Interests with a Scope Exception. In October 2016, the FASB issued Accounting Standards Update (ASU) No. 2016-16, Accounting for Income Taxes: Intra-Entity Asset Transfers of Assets Other than Inventory. In August 2016, the FASB issued ASU No. 2016-15, Statement of Cash Flows; Classification of Certain Cash Receipts and Cash Payments. In March 2016, the FASB issued ASU No. 2016-08, Revenue from Contracts with Customers. Revenue from Contracts with Customers. In February 2016, the FASB issued ASU No. 2016-2, Leases. |
Segment Reporting
Segment Reporting | 9 Months Ended |
Sep. 30, 2017 | |
Segment Reporting [Abstract] | |
Segment Reporting | Note 3 – Segment Reporting The Company has two reportable segments: (1) Monitoring and (2) Distributorships. Monitoring fees on Company installed units The Company rents units directly to customers and installs the units in the customer’s vehicles. The rental periods range from a few months to 2 years and include a combination of down payments made by the customer and monthly payments paid under the agreements with the Company. Revenue is recognized from these companies on the straight-line basis over the term of the agreement. Amounts collected in excess of those earned are classified as deferred revenue in the balance sheet, and amounts earned in excess of amounts collected are reflected in accounts receivable in the balance sheet at September 30, 2017 and December 31, 2016. Distributorships The Company enters into arrangements that include multiple deliverables, which typically consist of the sale of exclusive distributorship territory rights, startup supplies package, promotional material, three weeks of onsite training and ongoing monthly support services. The Company accounts for each material element within an arrangement with multiple deliverables as separate units of accounting. Revenue is allocated to each unit of accounting under the guidance of ASC Topic 605-25, Multiple-Element Revenue Arrangements, which provides criteria for separating consideration in multiple-deliverable arrangements by establishing a selling price hierarchy for determining the selling price of a deliverable. The selling price used for each deliverable is based on vendor-specific objective evidence (“VSOE”) if available, third-party evidence if VSOE is not available, or estimated selling price if neither VSOE nor third-party evidence is available. The Company is required to determine the best estimate of selling price in a manner that is consistent with that used to determine the price to sell the deliverable on a standalone basis. The Company generally does not separately sell distributorships or training on a standalone basis. Therefore, the Company does not have VSOE for the selling price of these units nor is third party evidence available and thus management uses its best estimate of selling prices in their allocation of revenue to each deliverable in the multiple element arrangement. The Three Months Ended September 30, Nine Months Ended September 30, 2017 2016 2017 2016 Segment gross profit (a) Monitoring $ 336,322 $ 72,804 $ 562,313 $ 164,071 Distributorships 84,276 13,275 278,990 28,725 Gross profit 420,598 85,359 841,303 192,796 Identifiable segment operating expenses (b) Monitoring 86,543 5,911 143,955 21,468 Distributorships 3,552 9,810 89,642 9,810 90,095 15,721 233,597 31,278 Identifiable segment operating income (c) Monitoring 249,779 66,173 418,358 142,603 Distributorships 80,724 3,465 189,348 18,915 330,503 69,638 607,706 161,518 Reconciliation of identifiable segment income to corporate income (d) Payroll 272,900 30,739 457,288 95,986 Professional fees 16,603 4,266 93,505 65,887 General and administrative expenses 269,039 115,868 579,172 341,827 Depreciation 417 320 1,057 1,693 Interest expense 145,740 41,790 440,538 111,715 Change in fair value of derivative liability 6,474 (16,814 ) (11,018 ) 2,798 Loss on extinguishment of debt - 116,541 305,000 116,541 Loss before provision for income taxes (380,670 ) (223,072 ) (1,257,836 ) (574,929 ) Provision for income taxes - - 1,600 - Net loss $ (380,670 ) $ (223,072 ) $ (1,259,436 ) $ (574,929 ) Total net property, plant, and equipment assets Monitoring $ 562,542 $ 127,815 Distributorships 350,298 58,410 Corporate 12,889 2,599 $ 925,729 $ 188,824 (a) Segment gross profit includes segment net sales less segment cost of sales (b) Identifiable segment operating expenses consists of identifiable depreciation expense (c) Identifiable segment operating income consists of segment gross profit less identifiable operating expense (d) General corporate expense consists of all other non-identifiable expenses |
Furniture and Equipment
Furniture and Equipment | 9 Months Ended |
Sep. 30, 2017 | |
Property, Plant and Equipment [Abstract] | |
Furniture and Equipment | Note 4 – Furniture and Equipment Furniture and equipment consist of the following: September 30, 2017 December 31, 2016 Monitoring Units $ 1,198,057 $ 419,898 Furniture, Fixtures, and Equipment 4,798 4,798 Software 11,667 - Total Assets 1,214,522 424,696 Less: Accumulated Depreciation (288,794 ) (68,350 ) Furniture and Equipment, net $ 925,728 $ 356,346 Depreciation expense for the three and nine months ended September 30, 2017 and 2016 were $90,512 and $16,041, and $234,654 and $32,971, respectively. $27,200 in monitoring units and $14,211 in related accumulated depreciation were disposed of in the three months ended September 30, 2017. |
Deposits
Deposits | 9 Months Ended |
Sep. 30, 2017 | |
Deposit Assets Disclosure [Abstract] | |
Deposits | Note 5 – Deposits Deposits consist of the following: September 30, 2017 December 31, 2016 Deposit for BDI-747 units $ - $ 250,000 Other 5,131 6,254 Total $ 5,131 $ 256,254 |
Accrued Expenses
Accrued Expenses | 9 Months Ended |
Sep. 30, 2017 | |
Payables and Accruals [Abstract] | |
Accrued Expenses | Note 6 – Accrued Expenses Accrued Expenses consist of the following: September 30, 2017 December 31, 2016 Accrued payroll and payroll taxes $ 218,975 $ 65,292 Miscellaneous 16,423 3,503 Total $ 235,398 $ 68,795 |
Deferred Revenue
Deferred Revenue | 9 Months Ended |
Sep. 30, 2017 | |
Deferred Revenue Disclosure [Abstract] | |
Deferred Revenue | Note 7 - Deferred revenue The Company classifies income as deferred until the terms of the contract or time frame have been met within the Company’s revenue recognition policy. As of September 30, 2017 and December 31, 2016, deferred revenue consist of the following: September 30, 2017 December 31, 2016 Monitoring deferred revenues $ 91,057 $ 103,831 Distributorship deferred revenues 7,000 58,500 Total $ 98,057 $ 162,331 |
Notes Payable
Notes Payable | 9 Months Ended |
Sep. 30, 2017 | |
Debt Disclosure [Abstract] | |
Notes Payable | Note 8 – Notes Payable Notes payable consist of the following: September 30, 3017 December 31, 2016 Principal Accrued interest Principal Accrued interest Convertible notes Convertible note #1 $ 7,500 $ 208 $ 7,500 $ 31 Debt discount - - (3,104 ) - Convertible note #2 50,000 2,034 50,000 1,617 Debt discount (3,115 ) - (20,620 ) - Subtotal convertible notes net 54,385 2,242 33,776 1,648 Promissory notes Promissory note #1 - - 990 - Promissory note #2 - - 13,278 - Debt discount - - (3,510 ) - Promissory note #3 50,000 1,500 50,000 - Debt discount (13,542 ) - (32,292 ) - Promissory note #4 10,000 2,200 10,000 400 Debt discount (384 ) - (7,308 ) - Promissory note #5 36,100 1,504 36,100 3,581 Promissory note #6 5,040 - 5,040 106 Debt discount (420 ) - (4,200 ) - Promissory note #7 24,960 2,629 24,960 - Promissory note #8 50,000 2,083 50,000 - Promissory note #9 50,400 1,050 - - Debt discount (8,085 ) - - - Promissory note #10 70,000 2,917 - - Debt discount (22,166 ) - - - Promissory note #11 75,000 3,411 - - Debt discount (24,583 ) - - - Subtotal promissory notes net 302,320 17,294 143,058 4,087 Royalty notes Royalty note #1 15,107 - 46,876 - Debt discount (14,549 ) - (45,903 ) - Royalty note #2 15,178 - 48,938 - Debt discount (14,844 ) - (41,133 ) - Royalty note #3 192,000 8,000 192,000 - Debt discount (128,000 ) - (176,000 ) - Royalty note #4 325,000 13,542 325,000 4,375 Debt discount (225,894 ) - (311,258 ) - Subtotal royalty notes net 163,997 21,542 38,520 4,375 Related party promissory note Related party promissory note - - 97,749 - Total notes $ 520,702 $ 41,078 $ 313,103 $ 10,110 Current portion $ 209,346 $ 41,078 $ 238,264 $ 10,110 Long-term portion $ 311,356 - $ 74,839 $ - Convertible note #1: On August 7, 2015, the Company entered into an agreement with a third party non-affiliate and issued a 7.5% interest bearing convertible debenture for $15,000 due on August 7, 2017, with conversion features commencing after 180 days following the date of the note. Payments of interest only were due monthly beginning September 2015. The loan is convertible at 70% of the average of the closing prices for the common stock during the five trading days prior to the conversion date. In connection with this Convertible note payable, the Company recorded a $5,770 discount on debt, related to the beneficial conversion feature of the note to be amortized over the life of the note or until the note is converted or repaid. This note was bifurcated with the embedded conversion option recorded as a derivative liability at fair value (See Note 9). On May 6, 2016 the note holder elected to convert $7,500 in principal into 30,000 shares of common stock. The note is currently in default. In connection with the issuance of the August Convertible Note Payable, the Company issued a warrant on August 7, 2015 to purchase 30,000 shares of the Company’s common stock at a purchase price of $0.50 per share. The Black Scholes model was used in valuing the warrants in determining the relative fair value of the warrants issued in connection with the convertible note payable using the following inputs: Expected Term – 3 years, Expected Dividend Rate – 0%, Volatility – 100%, Risk Free Interest Rate -1.08%. The Company recorded an additional $4,873 discount on debt, related to the relative fair value of the warrants issued associated with the note to be amortized over the life of the note. Convertible note #2 On November 24, 2015, the Company entered into an agreement with an existing non-affiliated shareholder, and issued a 10% interest bearing convertible debenture for $50,000 due on November 19, 2017. Payments of interest only are due monthly beginning December 2015. The loan is convertible at 70% of the average of the closing prices for the common stock during the five trading days prior to the conversion date, but may not be converted if such conversion would cause the holder to own more than 9.9% of outstanding common stock after giving effect to the conversion (which limitation may be removed by the holder upon 61 days advanced notice to the company). In connection with this Convertible Note Payable, the Company recorded a $32,897 discount on debt, related to the beneficial conversion feature of the note to be amortized over the life of the note or until the note is converted or repaid. This note was bifurcated with the embedded conversion option recorded as a derivative liability at fair value. As of September 30, 2017, this note has not been converted. In connection with the issuance of the November convertible note payable, the Company issued a warrant to purchase 80,000 shares of common stock at an exercise price of $0.80 per share. The warrant has an exercise period of two years from the date of issuance. The Black Scholes model was used in valuing the warrants in determining the relative fair value of the warrants issued in connection with the convertible note payable using the following inputs: Expected Term – 2 years, Expected Dividend Rate – 0%, Volatility – 100%, Risk Free Interest Rate -.61%. The Company recorded an additional $13,783 discount on debt, related to the relative fair value of the warrants issued associated with the note to be amortized over the life of the note. Promissory note #1: On December 18, 2015, the Company entered into a borrowing facility with a third party. The initial note value was for a principal balance of $10,200. The Company is allowed to draw limited additional funds at any time. During 2016 the Company drew an additional $13,100 in connection with this borrowing facility. The interest due is dependent on a cost schedule that is tied to the date of repayment of the principle. This borrowing facility was paid back in January 2017. Promissory note #2: On January 29, 2016, the Company entered into a note payable agreement with a third party. The note was for a principal balance of $44,850 in exchange for $29,505 in cash. The initial borrowing was paid back in August 2016. Subsequent to this initial repayment, the Company borrowed an additional $28,600 in September of 2016. The subsequent borrowing was paid back in April 2017. Promissory note #3: On March 30, 2016, the Company entered into a borrowing agreement with a third party. The note was for a principal balance of $50,000 and included 50,000 restricted common shares. The promissory note has a maturity date of June 30, 2018, and bears interest at 18% per annum. The purchaser did not sign the agreement nor deliver the proper consideration prior to March 31, 2016. The exchange of the $50,000 in cash consideration by the purchaser and the issuance of the 50,000 restricted common shares by the Company was made in conjunction with delivery of the signed purchase agreement and promissory note on April 5, 2016. The Company recorded a debt discount of $50,000 related to the relative fair value of the issued shares associated with the note to be amortized over the life of the note. Promissory note #4: On September 23, 2016, the Company provided an agreement to a third party to obtain a $10,000 promissory note in exchange for 100,000 restricted common shares and $10,000 in cash. The promissory note had a maturity date of October 31, 2017 and bears interest at 24% per annum. On October 31, 2017, the note was amended to extend the maturity date to October 31, 2018. There are no other changes to the note. The Company recorded a debt discount of $10,000 related to the relative fair value of the issued shares associated with the note to be amortized over the life of the note. Promissory note #5: On September 30, 2016, the Company provided an agreement to a third party to obtain a $36,100 promissory note in exchange for $36,100 in cash. The promissory note had a maturity date of October 1, 2017 and bears interest at 25% per annum. The note required interest only payments of $752 per month and a balloon payment of $36,100 for principle upon maturity. The note, along with promissory notes #7, #8, #9, #10, and #11(collectively “The Notes” and all to the same note holder), were amended November 1, 2017 and principal payments on The Notes is to be in sixty monthly payments of $15,000 principal and $10,000 monthly fee to commence December 1, 2018. Promissory note #6: On November 1, 2016, the Company provided an agreement to a third party to obtain a $5,040 promissory note in exchange for $5,040 in cash. The promissory note had a maturity date of November 1, 2017 and bears interest at 25% per annum. On November 1, 2017, the note was amended to extend the maturity date to November 1, 2018. There are no other changes to the note. The note requires interest only payments of $105 per month. In connection with the issuance of the note payable, the Company issued a warrant to purchase 50,000 shares of common stock at an exercise price of $0.10 per share. The warrant has an exercise period of four years from the date of issuance. The Black Scholes model was used in valuing the warrants in determining the relative fair value of the warrant using the following inputs: Expected Term – 4 years, Expected Dividend Rate – 0%, Volatility – 329%, Risk Free Interest Rate -1.56%. The Company recorded a discount of $5,040, related to the relative fair value of the warrants issued associated with the note to be amortized over the life of the note. Promissory note #7: On November 1, 2016, the Company provided an agreement to a third party to obtain a $24,960 promissory note in exchange for $24,960 in cash. The promissory note had a maturity date of November 1, 2017 and bears interest at 25% per annum. The note required total payments of $520 per month and a balloon payment of $24,960 for principle upon maturity. The note, along with promissory notes #5, #8, #9, #10, and #11(collectively “The Notes” and all to the same note holder), were amended November 1, 2017 and principal payments on The Notes is to be in sixty monthly payments of $15,000 principal and $10,000 monthly fee to commence December 1, 2018. Promissory note #8: On November 1, 2016, the Company provided an agreement to a third party to obtain a $50,000 promissory note in exchange for $50,000 in cash. The promissory note had a maturity date of November 1, 2019 and bears interest at 25% per annum. The note required total payments of $1,042 per month and a balloon payment of $50,000 for principle upon maturity. The note, along with promissory notes #5, #7, #9, #10, and #11(collectively “The Notes” and all to the same note holder), were amended November 1, 2017 and principal payments on The Notes is to be in sixty monthly payments of $15,000 principal and $10,000 monthly fee to commence December 1, 2018. Promissory note #9: On January 15, 2017, the Company provided an agreement to a third party to obtain a $50,400 promissory note in exchange for $50,400 in cash. The promissory note had a maturity date of January 15, 2018 and bears interest at 25% per annum. The note required total payments of $1,042 per month and a balloon payment of $50,000 for principle upon maturity. The Company recorded a debt discount of $27,720 related to the value of the issued shares associated with the process of obtaining the note to be amortized over the life of the note. The note, along with promissory notes #5, #7, #8, #10, and #11 (collectively “The Notes” and all to the same note holder), were amended November 1, 2017 and principal payments on The Notes is to be in sixty monthly payments of $15,000 principal and $10,000 monthly fee to commence December 1, 2018. Promissory note #10: On February 27, 2017, the Company provided an agreement to a third party to obtain a $70,000 promissory note in exchange for $70,000 in cash. The promissory note had a maturity date of February 27, 2020 and bears interest at 25% per annum. The note required total payments of $1,458 per month and a balloon payment of $70,000 for principle upon maturity. The Company recorded a debt discount of $28,000 related to the value of the issued shares associated with the process of obtaining the note to be amortized over the life of the note. The note, along with promissory notes #5, #7, #8, #9, and #11 (collectively “The Notes” and all to the same note holder), were amended November 1, 2017 and principal payments on The Notes is to be in sixty monthly payments of $15,000 principal and $10,000 monthly fee to commence December 1, 2018. Promissory note #11: On March 16, 2017, the Company provided an agreement to a third party to obtain a $75,000 promissory note in exchange for $75,000 in cash. The promissory note had a maturity date of March 16, 2020 and bears interest at 25% per annum. The note required total payments of $1,563 per month and a balloon payment of $75,000 for principle upon maturity. The Company recorded a debt discount of $30,000 related to the value of the issued shares associated with the process of obtaining the note to be amortized over the life of the note. The note, along with promissory notes #5, #7, #8, #9, and #11 (collectively “The Notes” and all to the same note holder), were amended November 1, 2017 and principal payments on The Notes is to be in sixty monthly payments of $15,000 principal and $10,000 monthly fee to commence December 1, 2018. Royalty note #1: On January 20, 2016, the company entered into a non-interest bearing note payable and royalty agreement with a third party. Under the note, the Company borrowed $65,000 and began to repay the principal amount at a rate of approximately $937 per month with escalations to approximately $3,531 per month as of February 2017 until the note is paid in full. In addition, starting in February 2018, the Company will pay the lender a royalty fee of five ($5) dollars per month for every ignition interlock devise that the Company has on the road in customers’ vehicles up to eight hundred (800) in perpetuity, and for every unit over 800, the Company will owe the lender $1 per month per device in perpetuity. In connection with this note, the Company recorded a debt discount of $65,000 relating to the future royalty payments, to be amortized over the life of the note. On September 30, 2016, the Company entered into Amendment No. 1 to Royalty note #1 in order to remove a security interest in the Company’s assets to secure repayment of the original note and amend the royalty provisions of the original note to be $1 for each Device on the road beginning in the 25 th Royalty note #2: On March 29, 2016, the company consummated a non-interest bearing note payable and royalty agreement with a relative of the CEO with terms almost identical to the note referenced above. Under the note, the Company borrowed $55,000 and began to repay the principal amount at a rate of approximately $937 per month with escalations to approximately $3,531 per month as of April 2017 until the note is paid in full. In addition, starting in February 2018, the Company will pay the lender a royalty fee of five ($5) dollars per month for every ignition interlock devise that the Company has on the road in customers’ vehicles up to eight hundred (800) in perpetuity, and for every unit over 800, the Company will owe the lender $1 per month per device in perpetuity. In connection with this note, the Company recorded a debt discount of $55,000 relating to the future royalty payments, to be amortized over the life of the note. On September 30, 2016, the Company entered into Amendment No. 1 to Royalty note #2 to amend the royalty provisions of the original note to be $1 for each Device on the road beginning in the 25 th Royalty note #3: On September 30, 2016, the Company entered into a Loan and Security Agreement (the “LSA”) with Doheny Group, LLC, a Delaware limited liability company (“Doheny”), under which Doheny agreed to loan up to $542,400 in two phases, to be used to acquire additional parts and supplies to manufacture the Company’s proprietary breath alcohol ignition interlock devices. Under the terms of the LSA, the first phase will be a loan of up to $192,000 to acquire parts and supplies to manufacture 600 Devices; and the second phase will be a loan of up to $350,400 to acquire parts and supplies to manufacture 1,000 Devices. The Phase 1 Loan was funded in the amount of $192,000 by Doheny on September 30, 2016, upon which the Company forwarded the funds to its supplier on or about October 5, 2016, in order to acquire parts and supplies to manufacture 600 Devices. Both the Phase 1 Loan and the Phase 2 Loan mature three years from the date of funding, and are at an interest rate of 25% per annum. The note requires interest only payments of $4,000 per month. The Company can prepay the Phase 1 Loan and the Phase 2 Loan (if applicable) at any time without penalty. In exchange for Doheny funding the Phase 1 Loan, the Company issued Doheny a promissory note for $192,000 and also issued Doheny shares of common stock equal to 4.99% of the then-outstanding common stock, pursuant to the terms of a stock purchase agreement. As a result, on or about October 7, 2016, the Company issued Doheny 845,913 shares of common stock. In addition, upon funding of any portion of the Phase 2 loan (Royalty Note #4 below) then the Company is obligated to issue Doheny that number of additional shares of common stock that equals 5% of the then-outstanding common stock. Until the Company repays the Phase 1 Loan and the Phase 2 Loan, as applicable, Doheny has anti-dilution rights for the percentage of stock Doheny owns in the event the Company issues additional shares of common stock during that period. The Company also entered into a Royalty Agreement with Doheny, under which Doheny was granted perpetual royalty rights on all Devices when the Company has 500 or more Devices in service whether rented to end users or distributors. The royalty amounts vary between $1 and $2 per Device depending on a variety of factors. The Company recorded a debt discount of $192,000 related to the relative fair value of the issued shares associated with the Phase 1 note to be amortized over the life of the note. On August 3, 2017, the Company entered into an amendment (“Amendment No. 1 to Royalty Agreement”) with Doheny Group, LLC. The amendment amends the calculation of royalty amounts to a monthly calculation of $1.30 per unit (whether retail or wholesale unit) on the total number of units each month in perpetuity. The amendment also amends the payment of royalties to commence from and after the effective date of the amendment on all units at customers, beginning with the first unit. Royalty note #4: On November 4, 2016, the Company agreed to fund an initial portion of the Phase 2 loan as described in “Royalty note #3” above. In connection with this funding the common stock ownership percentage of Doheny Group was increased to 9.95%. As also described in “Royalty note #3” above Doheny has anti-dilution privileges to maintain 9.95% of common stock ownership at no additional cost until both Royalty note #3 and Royalty note #4 are paid in full. As of September 30, 2017, the Company has drawn $325,000 out of the maximum allowance of $350,400 in connection with Royalty note #4. Related party promissory note On February 16, 2014, the Company entered into a note payable agreement with Laurence Wainer, the director, President and sole officer of the Company. The note was for a principal balance of $160,000 and bears interest at 7.75% per annum. Principal and interest payments are due in 60 equal monthly installments beginning in March 2014 of $3,205. The Company and Laurence Wainer entered into an additional agreement effective April 2014 suspending loan repayments until January 2015. As of January 2015, the payments have resumed. On March 31, 2017 the Company entered into an agreement with Mr. Wainer to issue to him 1,000,000 Series A Preferred Shares in exchange $25,537 in accrued salary. On May 19 , |
Derivative Financial Instrument
Derivative Financial Instruments | 9 Months Ended |
Sep. 30, 2017 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
Derivative Financial Instruments | Note 9 – Derivative Financial Instruments The Company applies the provisions of ASC Topic 815-40, Contracts in Entity’s Own Equity (“ASC Topic 815-40”), under which convertible instruments, which contain terms that protect holders from declines in the stock price, may not be exempt from derivative accounting treatment. As a result, embedded conversion options (whose exercise price is not fixed and determinable) in convertible debt (which is not conventionally convertible due to the exercise price not being fixed and determinable) are initially recorded as a liability and are revalued at fair value at each reporting date using the Black Sholes Model. The Company has a $7,500 and a $50,000 convertible note with variable conversion pricing outstanding at September 30, 2017. The following inputs were used within the Black Sholes Model to determine the initial relative fair value: Expected Term – .85 and 1.11 years, Expected Dividend Rate – 0%, Volatility – 312%, Risk Free Interest Rate - 0.55%. The Company revalues these derivatives each quarter using the Black Sholes Model. The change in valuation is accounted for as a gain or loss in derivative liability. The following table describes the Derivative liability as of September 30, 2017 and December 31, 2016. Balance December 31, 2016 $ 73,556 Change in fair market value of derivatives (11,019 ) Balance September 30, 2017 (unaudited) $ 62,537 |
Accrued Royalties Payable
Accrued Royalties Payable | 9 Months Ended |
Sep. 30, 2017 | |
Accrued Royalties Payable | |
Accrued Royalties Payable | Note 10 – Accrued Royalties Payable In connection with the Royalty Notes number 1-4 as discussed in Note 8 above the Company has estimated the royalties to be paid out in perpetuity. These estimates were performed at the inception for the notes to reflect the associated debt discount. Payments on such royalty notes became due in October 2016 upon the Company hitting certain sales milestones as set forth in the royalty agreements. |
Stockholders' Equity
Stockholders' Equity | 9 Months Ended |
Sep. 30, 2017 | |
Equity [Abstract] | |
Stockholders' Equity | Note 11 – Stockholders’ Equity Preferred Stock The Company’s articles of incorporation authorize the Company to issue up to 20,000,000 preferred shares of $0.001 par value. Series A Preferred Stock The Company has been authorized to issue 1,000,000 shares of Series A Preferred Stock. The Series A shares have the following preferences: no dividend rights; no liquidation preference over the Company’s common stock; no conversion rights; no redemption rights; no call rights by the Company; each share of Series A Preferred stock will have one hundred (100) votes on all matters validly brought to the Company’s common stockholders During the three months ended March 31, 2017, the Company entered into a material definitive agreement to issue 1,000,000 shares of series A preferred stock to an officer and director of the Company with a preliminary estimated value of $350,000. As of September 30, 2017, the total number of preferred shares issued or issuable was 1,000,000. Common Stock The Company has authorized 100,000,000 shares of $.0001. Holders of common stock are entitled to one vote for each share held. There are no restrictions that limit the Company’s ability to pay dividends on its common stock, subject to the requirements of the Delaware Revised Statutes. The Company has not declared any dividends since incorporation. During the nine months ended September 30, 2017, the Company issued 27,180 shares of $0.001 par value common stock for services with a value of $13,913. The Company also issued 195,400 shares, valued at $85,720, to a related party in connection with obtaining debt financing. |
Warrants
Warrants | 9 Months Ended |
Sep. 30, 2017 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
Warrants | Note 12 – Warrants The Company issued warrants in individual sales and in connection with common stock purchase agreements. The warrants have expiration dates ranging from three to four years from the date of grant and exercise prices ranging from $0.10 to $.35. The Company issued 1,000 warrants for services rendered. The warrants have expiration dates of four years from the date of grant and an exercise price of $1.00. The Black Scholes model was used in valuing the warrants in determining the relative fair value of the warrant using the following inputs: Expected Term – 4 years, Expected Dividend Rate – 0%, Volatility – 286%, Risk Free Interest Rate -1.54%. A summary of warrant activity for the periods presented is as follows: Weighted Average Warrants for Common Shares Weighted Average Exercise Price Remaining Contractual Term Aggregate Intrinsic Value Outstanding and exercisable as of December 31, 2014 - $ - $ - $ - Granted 110,000 0.72 2.27 - Exercised - - - - Forfeited, cancelled, expired - - - - Outstanding as of December 31, 2015 110,000 $ 0.72 $ 2.10 - Granted 50,000 0.10 4.00 Exercised - - - - Forfeited, cancelled, expired - - - - Outstanding as of December 31, 2016 160,000 $ 0.53 $ 1.97 5,250 Granted 4,977,298 0.46 4.00 407,614 Exercised - - - Forfeited, cancelled, expired - - - Outstanding as of September 30, 2017 5,137,298 $ 0.46 $ 3.38 412,864 |
Income (Loss) Per Share
Income (Loss) Per Share | 9 Months Ended |
Sep. 30, 2017 | |
Earnings Per Share [Abstract] | |
Income (Loss) Per Share | Note 13 – Income (Loss) Per Share Net income (loss) per share is provided in accordance with FASB ASC 260-10, “Earnings per Share”. The following shares are not included in the computation of diluted income (loss) per share, because their inclusion would be anti-dilutive: Three Months Ended September 30, Nine Months Ended September 30, 2017 2016 2017 2016 Preferred shares - - - Convertible notes 375,082 194,008 375,082 205,737 Warrants 5,137,298 110,000 5,137,298 110,000 Options - - - - Total anti-dilutive weighted average shares 5,512,380 304,008 5,512,380 315,737 If all dilutive securities had been exercised at September 30, 2017 the total number of common shares outstanding would be as follows: Common Shares 24,057,961 Preferred Shares - Convertible notes 375,082 Warrants 5,137,298 Options - Total potential shares 29,570,341 |
Commitments and Contingencies
Commitments and Contingencies | 9 Months Ended |
Sep. 30, 2017 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | Note 14 – Commitments and Contingencies On December 1, 2016, the Company entered into a four-year lease with Cahuenga Management LLC for a storefront location at 15503 Cahuenga Blvd., North Hollywood, California 91601. Base rent under the lease is $2,200 per month, with an escalating provision up to $2,404 throughout the lease term. The rental agreement includes operating expenses such as common area maintenance, property taxes and insurance. On August 28, 2017, the Company entered into a one-year lease with B3 Investments, LLC for a storefront location at Suites D104 and D105, 2406 24 th Legal Proceedings In the ordinary course of business, the Company from time to time is involved in various pending or threatened legal actions. The litigation process is inherently uncertain and it is possible that the resolution of such matters might have a material adverse effect upon the Company’s financial condition and/or results of operations. However, in the opinion of management, other than as set forth herein, matters currently pending or threatened against the Company are not expected to have a material adverse effect on the Company’s financial position or results of operations. |
Settlement with Distributor
Settlement with Distributor | 9 Months Ended |
Sep. 30, 2017 | |
Settlement With Distributor | |
Settlement with Distributor | Note 15 – Settlement with Distributor On January 21, 2018, the Company and its major distributor memorialized a September 30, 2017 oral agreement that terminated their September 5, 2015 distributorship agreement. The distributor had failed to timely make required monthly payments. The Company agreed to not pursue amounts due it from the distributor under the distributorship agreement. However, in the settlement agreement, the parties agreed Lopez would pay the Company the amounts it would have been entitled to under the distributorship agreement if Lopez is paid any amounts from customers or sub-distributors for periods prior to the termination of the distributorship agreement. The Company agreed to assist the distributor in attempting to collect from any sub-distributors that have not paid the distributor amounts owed. The Company has sent letters to all customers of the distributor and believes that it will retain most, if not all, customers. If customers are not retained, the customers will need to have the interlock device removed and returned to the Company. The Company had approximately 900 interlock units rented to the distributor. As of September 30, 2017, $35,979 in distributor revenue and accounts receivable were reversed out. |
Subsequent Events
Subsequent Events | 9 Months Ended |
Sep. 30, 2017 | |
Subsequent Events [Abstract] | |
Subsequent Events | Note 16 – Subsequent Events The Company follows the guidance in FASB ASC Topic 855, Subsequent Events Subsequent to September 30, 2017, and through the date of this filing, the Company has issued a total of 1,072,536 common shares for an aggregate cash purchase price of $142,300. In connection with these sales of common shares the Company has also issued warrants for 284,600 common shares. On November 1, 2017, the Company and the Doheny Group entered into an amendment to their November 1, 2016 loan agreement. The new loan agreement extends the term of the loan for sixty months and is to be paid back in sixty equal monthly payments of $25,000 consisting of $15,000 principal payment and a monthly fee of $10,000 to commence on December 1, 2018. On November 1, 2017, the Company and Joseph Haridim entered into an amendment to their October 31, 2016 loan agreement. The new loan agreement extends the term of the loan for twelve months and the loan is now due in full on November 1, 2018. |
Basis of Presentation and Sum23
Basis of Presentation and Summary of Significant Accounting Policies (Policies) | 9 Months Ended |
Sep. 30, 2017 | |
Accounting Policies [Abstract] | |
Basis of Presentation | Basis of Presentation The accompanying consolidated financial statements have been prepared by the Company in accordance with generally accepted accounting principles in the United States of America, and pursuant to the rules and regulations of the Securities and Exchange Commission and reflect all adjustments, consisting of normal recurring adjustments, which management believes are necessary to fairly present the financial position, results of operations and cash flows of the Company. |
Going Concern | Going Concern The Company’s unaudited condensed consolidated financial statements are prepared using generally accepted accounting principles in the United States of America applicable to a going concern which contemplates the realization of assets and liquidation of liabilities in the normal course of business. The Company has not yet established an ongoing source of revenue sufficient to cover its operating costs and allow it to continue as a going concern. As of September 30, 2017, the Company had an accumulated deficit of $2,846,765 (restated). The ability of the Company to continue as a going concern is dependent on the Company obtaining adequate capital to fund operating losses until it becomes profitable. If the Company is unable to obtain adequate capital, it could be forced to cease or reduce its operations. In order to continue as a going concern, the Company will need, among other things, additional capital resources. The Company will continue to raise funds through the sale of its equity securities or issuance of notes payable to obtain additional operating capital. The Company is dependent upon its ability to, and will continue to attempt to, secure additional equity and/or debt financing until the Company can earn revenue and realize positive cash flow from its operations. There are no assurances that the Company will be successful in earning revenue and realizing positive cash flow from its operations. Without sufficient financing it would be unlikely that the Company will continue as a going concern. Based on the Company’s current rate of cash outflows, cash on hand and proceeds from the prior sale of equity securities and issuance of notes payable, management believes that its current cash will not be sufficient to meet the anticipated cash needs for working capital for the next 12 months. The Company’s plans with respect to its liquidity issues include, but are not limited to, the following: 1) Continue to issue restricted stock for compensation due to consultants and for its legacy accounts payable in lieu of cash payments; and 2) Seek additional capital to continue its operations as it rolls out its current products. The Company is currently evaluating additional debt or equity financing opportunities and may execute them when appropriate. However, there can be no assurances that the Company can consummate such a transaction, or consummate a transaction at favorable pricing. The ability of the Company to continue as a going concern is dependent upon its ability to successfully accomplish the plans described in the preceding paragraph and eventually secure other sources of financing and achieve profitable operations. These condensed consolidated financial statements do not include any adjustments relating to the recoverability and classification of recorded asset amounts, or amounts and classification of liabilities that might result from this uncertainty. |
Reclassifications | Reclassifications Certain reclassifications have been made to amounts in prior periods to conform to the current period presentation. All reclassifications have been applied consistently to the periods presented. |
Use of Estimates | Use of Estimates The preparation of financial statements in conformity with U.S. generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenue and expenses during the reporting periods. Actual results could differ from those estimates. |
Revenue Recognition | Revenue Recognition The Company recognizes revenue when earned and related costs of sales and expenses when incurred. The Company recognizes revenue in accordance with FASB ASC Topic 605-10-S99, Revenue Recognition, Overall, SEC Materials Monthly per unit fee revenue is earned and recognized over the term of the contract as support services are provided. Revenues from territory exclusivity are earned when there is persuasive evidence of an arrangement, delivery has occurred, the sales price has been determined and collectability has been reasonably assured. |
Accounts Receivable and Allowance for Doubtful Accounts | Accounts Receivable and Allowance for Doubtful Accounts The Company’s accounts receivable primarily consist of trade receivables. The Company records an allowance for doubtful accounts that is based on historical trends, customer knowledge, any known disputes, and the aging of the accounts receivable balances combined with management’s estimate of future potential recoverability. Receivables are written off against the allowance after all attempts to collect a receivable have failed. The Company believes its allowance for doubtful accounts as of September 30, 2017 and December 31, 2016 is adequate, but actual write-offs could exceed the recorded allowance. |
Inventories | Inventories Inventories are valued at the first-in first-out method and at September 30, 2017 and December 31, 2016 consists of spare parts for the BDI 747 monitoring units. |
Convertible Debt and Warrants Issued with Convertible Debt | Convertible Debt and Warrants Issued with Convertible Debt Convertible debt is accounted for under the guidelines established by ASC 470, Debt with Conversion and Other Options Beneficial Conversion Features The Company calculates the fair value of warrants issued with the convertible instruments using the Black-Scholes valuation method, using the same assumptions used for valuing employee options for purposes of ASC 718, Compensation – Stock Compensation For modifications of convertible debt, the Company records a modification that changes the fair value of an embedded conversion feature, including a BCF, as a debt discount which is then amortized to interest expense over the remaining life of the debt. If modification is considered substantial (i.e. greater than 10% of the carrying value of the debt), an extinguishment of debt is deemed to have occurred, resulting in the recognition of an extinguishment gain or loss. |
Fair Value of Financial Instruments | Fair Value of Financial Instruments The Company utilizes ASC 820-10, Fair Value Measurement and Disclosure, for valuing financial assets and liabilities measured on a recurring basis. Fair value is defined as the exit price, or the amount that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants as of the measurement date. The guidance also establishes a hierarchy for inputs used in measuring fair value that maximizes the use of observable inputs and minimizes the use of unobservable inputs by requiring that the most observable inputs be used when available. Observable inputs are inputs market participants would use in valuing the asset or liability and are developed based on market data obtained from sources independent of the Company. Unobservable inputs are inputs that reflect the Company’s assumptions about the factors market participants would use in valuing the asset or liability. The guidance establishes three levels of inputs that may be used to measure fair value: Level 1. Observable inputs such as quoted prices in active markets; Level 2. Inputs, other than the quoted prices in active markets, that are observable either directly or indirectly; and Level 3. Unobservable inputs in which there is little or no market data, which require the reporting entity to develop its own assumptions. The table below describes the Company’s valuation of financial instruments using guidance from ASC 820-10: Fair Value Measurements Using Level 1 Level 2 Level 3 Balance December 31, 2016 $ - $ 73,556 $ - Change in fair value of derivative liability - (11,019 ) - Balance September 30, 2017 (unaudited) $ - $ 62,537 $ - |
Net Income (Loss) Per Share | Net Income (Loss) Per Share Basic earnings per share is calculated by dividing income available to common stockholders by the weighted-average number of common shares outstanding during each period. Diluted earnings per share is computed using the weighted average number of common and dilutive common share equivalents outstanding during the period. |
Stock Based Compensation | Stock Based Compensation The Company recognizes stock-based compensation in accordance with FASB ASC Topic 718 Stock Compensation For non-employee stock-based compensation, the Company applies FASB ASC Topic 505 Equity-Based Payments to Non-Employees |
Concentrations | Concentrations All of the parts for the Company’s ignition interlock devices are purchased from one supplier in China. The loss of this supplier could have a material impact on the Company’s ability to timely obtain additional units. The Company has multiple distributors as of September 30, 2017, and is actively engaging more in new markets. However, for the three and nine months ended September 30, 2017, one distributor, licensed in four states, makes up approximately 100% and 91% percent of all revenues from distributors, respectively, and 100% of accounts receivable at September 30, 2017. The loss of this distributer would have a material impact on the Company’s revenues. Per an agreement dated January 21, 2018 that memorialized a September 30, 2017 oral agreement, the Company and its largest distributor cancelled their distributorship agreement dated September 5, 2015. See Note 15 below. |
Income Taxes | Income Taxes The Company accounts for its income taxes in accordance with Income Taxes Topic of the FASB ASC 740, which requires recognition of deferred tax assets and liabilities for future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases and tax credit carry forwards. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in operations in the period that includes the enactment date. The Company also follows ASC 740-10-25, which provides detailed guidance for the financial statement recognition, measurement and disclosure of uncertain tax positions recognized in an enterprise’s financial statements in accordance with ASC Topic 740, “ Accounting for Income Taxes” |
Derivative Liabilities | Derivative Liabilities The Company assessed the classification of its derivative financial instruments as of September 30, 2017, which consist of convertible instruments and rights to shares of the Company’s common stock, and determined that such derivatives meet the criteria for liability classification under ASC 815. ASC 815 generally provides three criteria that, if met, require companies to bifurcate conversion options from their host instruments and account for them as free-standing derivative financial instruments. These three criteria include circumstances in which (a) the economic characteristics and risks of the embedded derivative instrument are not clearly and closely related to the economic characteristics and risks of the host contract, (b) the hybrid instrument that embodies both the embedded derivative instrument and the host contract is not re-measured at fair value under otherwise applicable generally accepted accounting principles with changes in fair value reported in earnings as they occur and (c) a separate instrument with the same terms as the embedded derivative instrument would be considered a derivative instrument subject to the requirements of ASC 815. ASC 815 also provides an exception to this rule when the host instrument is deemed to be conventional, as defined. |
Convertible Instruments | Convertible Instruments The Company evaluates and accounts for conversion options embedded in its convertible instruments in accordance with professional standards for “Accounting for Derivative Instruments and Hedging Activities”. ASC 815-40 provides that, among other things, generally, if an event is not within the entity’s control or could require net cash settlement, then the contract shall be classified as an asset or a liability. |
Recently Issued Accounting Pronouncements | Recently Issued Accounting Pronouncements In September 2017, the Financial Accounting Standards Board (FASB) issued Accounting Standards Update (ASU) No. 2017-13, Revenue Recognition, Revenue from Contracts with Customers, Leases. In July 2017, the FASB issued Accounting Standards Update (ASU) No. 2017-11, Earnings Per Share; Distinguishing Liabilities from Equity; Derivatives and Hedging; Accounting for Certain Financial Instruments with Down Round Features; Replacement of the Indefinite Deferral for Mandatorily Redeemable Financial Instruments of Certain Nonpublic Entities and Certain Mandatorily Redeemable Noncontrolling Interests with a Scope Exception. In October 2016, the FASB issued Accounting Standards Update (ASU) No. 2016-16, Accounting for Income Taxes: Intra-Entity Asset Transfers of Assets Other than Inventory. In August 2016, the FASB issued ASU No. 2016-15, Statement of Cash Flows; Classification of Certain Cash Receipts and Cash Payments. In March 2016, the FASB issued ASU No. 2016-08, Revenue from Contracts with Customers. Revenue from Contracts with Customers. In February 2016, the FASB issued ASU No. 2016-2, Leases. |
Basis of Presentation and Sum24
Basis of Presentation and Summary of Significant Accounting Policies (Tables) | 9 Months Ended |
Sep. 30, 2017 | |
Accounting Policies [Abstract] | |
Schedule of Financial Instruments Measured at Fair Value On Recurring Basis | The table below describes the Company’s valuation of financial instruments using guidance from ASC 820-10: Fair Value Measurements Using Level 1 Level 2 Level 3 Balance December 31, 2016 $ - $ 73,556 $ - Change in fair value of derivative liability - (11,019 ) - Balance September 30, 2017 (unaudited) $ - $ 62,537 $ - |
Segment Reporting (Tables)
Segment Reporting (Tables) | 9 Months Ended |
Sep. 30, 2017 | |
Segment Reporting [Abstract] | |
Schedule of Net Sales and Identifiable Operating Income by Segment | The Three Months Ended September 30, Nine Months Ended September 30, 2017 2016 2017 2016 Segment gross profit (a) Monitoring $ 336,322 $ 72,804 $ 562,313 $ 164,071 Distributorships 84,276 13,275 278,990 28,725 Gross profit 420,598 85,359 841,303 192,796 Identifiable segment operating expenses (b) Monitoring 86,543 5,911 143,955 21,468 Distributorships 3,552 9,810 89,642 9,810 90,095 15,721 233,597 31,278 Identifiable segment operating income (c) Monitoring 249,779 66,173 418,358 142,603 Distributorships 80,724 3,465 189,348 18,915 330,503 69,638 607,706 161,518 Reconciliation of identifiable segment income to corporate income (d) Payroll 272,900 30,739 457,288 95,986 Professional fees 16,603 4,266 93,505 65,887 General and administrative expenses 269,039 115,868 579,172 341,827 Depreciation 417 320 1,057 1,693 Interest expense 145,740 41,790 440,538 111,715 Change in fair value of derivative liability 6,474 (16,814 ) (11,018 ) 2,798 Loss on extinguishment of debt - 116,541 305,000 116,541 Loss before provision for income taxes (380,670 ) (223,072 ) (1,257,836 ) (574,929 ) Provision for income taxes - - 1,600 - Net loss $ (380,670 ) $ (223,072 ) $ (1,259,436 ) $ (574,929 ) Total net property, plant, and equipment assets Monitoring $ 562,542 $ 127,815 Distributorships 350,298 58,410 Corporate 12,889 2,599 $ 925,729 $ 188,824 (a) Segment gross profit includes segment net sales less segment cost of sales (b) Identifiable segment operating expenses consists of identifiable depreciation expense (c) Identifiable segment operating income consists of segment gross profit less identifiable operating expense (d) General corporate expense consists of all other non-identifiable expenses |
Furniture and Equipment (Tables
Furniture and Equipment (Tables) | 9 Months Ended |
Sep. 30, 2017 | |
Property, Plant and Equipment [Abstract] | |
Schedule of Furniture and Equipment | Furniture and equipment consist of the following: September 30, 2017 December 31, 2016 Monitoring Units $ 1,198,057 $ 419,898 Furniture, Fixtures, and Equipment 4,798 4,798 Software 11,667 - Total Assets 1,214,522 424,696 Less: Accumulated Depreciation (288,794 ) (68,350 ) Furniture and Equipment, net $ 925,728 $ 356,346 |
Deposits (Tables)
Deposits (Tables) | 9 Months Ended |
Sep. 30, 2017 | |
Deposit Assets Disclosure [Abstract] | |
Schedule of Deposits | Deposits consist of the following: September 30, 2017 December 31, 2016 Deposit for BDI-747 units $ - $ 250,000 Other 5,131 6,254 Total $ 5,131 $ 256,254 |
Accrued Expenses (Tables)
Accrued Expenses (Tables) | 9 Months Ended |
Sep. 30, 2017 | |
Payables and Accruals [Abstract] | |
Schedule of Accrued Expenses | Accrued Expenses consist of the following: September 30, 2017 December 31, 2016 Accrued payroll and payroll taxes $ 218,975 $ 65,292 Miscellaneous 16,423 3,503 Total $ 235,398 $ 68,795 |
Deferred Revenue (Tables)
Deferred Revenue (Tables) | 9 Months Ended |
Sep. 30, 2017 | |
Deferred Revenue Disclosure [Abstract] | |
Schedule of Deferred Revenue | As of September 30, 2017 and December 31, 2016, deferred revenue consist of the following: September 30, 2017 December 31, 2016 Monitoring deferred revenues $ 91,057 $ 103,831 Distributorship deferred revenues 7,000 58,500 Total $ 98,057 $ 162,331 |
Notes Payable (Tables)
Notes Payable (Tables) | 9 Months Ended |
Sep. 30, 2017 | |
Debt Disclosure [Abstract] | |
Schedule of Notes Payable | Notes payable consist of the following: September 30, 3017 December 31, 2016 Principal Accrued interest Principal Accrued interest Convertible notes Convertible note #1 $ 7,500 $ 208 $ 7,500 $ 31 Debt discount - - (3,104 ) - Convertible note #2 50,000 2,034 50,000 1,617 Debt discount (3,115 ) - (20,620 ) - Subtotal convertible notes net 54,385 2,242 33,776 1,648 Promissory notes Promissory note #1 - - 990 - Promissory note #2 - - 13,278 - Debt discount - - (3,510 ) - Promissory note #3 50,000 1,500 50,000 - Debt discount (13,542 ) - (32,292 ) - Promissory note #4 10,000 2,200 10,000 400 Debt discount (384 ) - (7,308 ) - Promissory note #5 36,100 1,504 36,100 3,581 Promissory note #6 5,040 - 5,040 106 Debt discount (420 ) - (4,200 ) - Promissory note #7 24,960 2,629 24,960 - Promissory note #8 50,000 2,083 50,000 - Promissory note #9 50,400 1,050 - - Debt discount (8,085 ) - - - Promissory note #10 70,000 2,917 - - Debt discount (22,166 ) - - - Promissory note #11 75,000 3,411 - - Debt discount (24,583 ) - - - Subtotal promissory notes net 302,320 17,294 143,058 4,087 Royalty notes Royalty note #1 15,107 - 46,876 - Debt discount (14,549 ) - (45,903 ) - Royalty note #2 15,178 - 48,938 - Debt discount (14,844 ) - (41,133 ) - Royalty note #3 192,000 8,000 192,000 - Debt discount (128,000 ) - (176,000 ) - Royalty note #4 325,000 13,542 325,000 4,375 Debt discount (225,894 ) - (311,258 ) - Subtotal royalty notes net 163,997 21,542 38,520 4,375 Related party promissory note Related party promissory note - - 97,749 - Total notes $ 520,702 $ 41,078 $ 313,103 $ 10,110 Current portion $ 209,346 $ 41,078 $ 238,264 $ 10,110 Long-term portion $ 311,356 - $ 74,839 $ - |
Derivative Financial Instrume31
Derivative Financial Instruments (Tables) | 9 Months Ended |
Sep. 30, 2017 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
Schedule of Derivative Liability | The following table describes the Derivative liability as of September 30, 2017 and December 31, 2016. Balance December 31, 2016 $ 73,556 Change in fair market value of derivatives (11,019 ) Balance September 30, 2017 (unaudited) $ 62,537 |
Warrants (Tables)
Warrants (Tables) | 9 Months Ended |
Sep. 30, 2017 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
Schedule of Warrant Activity | A summary of warrant activity for the periods presented is as follows: Weighted Average Warrants for Common Shares Weighted Average Exercise Price Remaining Contractual Term Aggregate Intrinsic Value Outstanding and exercisable as of December 31, 2014 - $ - $ - $ - Granted 110,000 0.72 2.27 - Exercised - - - - Forfeited, cancelled, expired - - - - Outstanding as of December 31, 2015 110,000 $ 0.72 $ 2.10 - Granted 50,000 0.10 4.00 Exercised - - - - Forfeited, cancelled, expired - - - - Outstanding as of December 31, 2016 160,000 $ 0.53 $ 1.97 5,250 Granted 4,977,298 0.46 4.00 407,614 Exercised - - - Forfeited, cancelled, expired - - - Outstanding as of September 30, 2017 5,137,298 $ 0.46 $ 3.38 412,864 |
Income (Loss) Per Share (Tables
Income (Loss) Per Share (Tables) | 9 Months Ended |
Sep. 30, 2017 | |
Earnings Per Share [Abstract] | |
Schedule of Antidilutive Securities Excluded from Computation of Earnings Per Share | The following shares are not included in the computation of diluted income (loss) per share, because their inclusion would be anti-dilutive: Three Months Ended September 30, Nine Months Ended September 30, 2017 2016 2017 2016 Preferred shares - - - Convertible notes 375,082 194,008 375,082 205,737 Warrants 5,137,298 110,000 5,137,298 110,000 Options - - - - Total anti-dilutive weighted average shares 5,512,380 304,008 5,512,380 315,737 |
Schedule of Dilutive Securities of Common Shares Outstanding | If all dilutive securities had been exercised at September 30, 2017 the total number of common shares outstanding would be as follows: Common Shares 24,057,961 Preferred Shares - Convertible notes 375,082 Warrants 5,137,298 Options - Total potential shares 29,570,341 |
Organization and Nature of Bu34
Organization and Nature of Business (Details Narrative) | Dec. 31, 2015 |
Arizona Corporation [Member] | |
Ownership percent | 100.00% |
Basis of Presentation and Sum35
Basis of Presentation and Summary of Significant Accounting Policies (Details Narrative) - USD ($) | 3 Months Ended | 9 Months Ended | |
Sep. 30, 2017 | Sep. 30, 2017 | Dec. 31, 2016 | |
Accumulated deficit | $ 2,846,765 | $ 2,846,765 | $ 1,587,330 |
Maximum percentage of carrying value of debt | 10.00% | 10.00% | |
One Distributer [Member] | Revenue [Member] | |||
Concentration risk, percentage | 100.00% | 91.00% | |
Distributer [Member] | Accounts Receivable [Member] | |||
Concentration risk, percentage | 100.00% |
Basis of Presentation and Sum36
Basis of Presentation and Summary of Significant Accounting Policies - Schedule of Financial Instruments Measured at Fair Value On Recurring Basis (Details) | 9 Months Ended |
Sep. 30, 2017USD ($) | |
Fair Value, Inputs, Level 1 [Member] | |
Balance, beginning | |
Change in fair value of derivative liability | |
Balance, ending | |
Fair Value, Inputs, Level 2 [Member] | |
Balance, beginning | 73,556 |
Change in fair value of derivative liability | (11,019) |
Balance, ending | 62,537 |
Fair Value, Inputs, Level 3 [Member] | |
Balance, beginning | |
Change in fair value of derivative liability | |
Balance, ending |
Segment Reporting (Details Narr
Segment Reporting (Details Narrative) | 9 Months Ended |
Sep. 30, 2017Installments | |
Segment Reporting [Abstract] | |
Number of reportable segments | 2 |
Rental period description | The rental periods range from a few months to 2 years and include a combination of down payments made by the customer and monthly payments paid under the agreements with the Company. |
Segment Reporting - Schedule of
Segment Reporting - Schedule of Net Sales and Identifiable Operating Income by Segment (Details) - USD ($) | 3 Months Ended | 9 Months Ended | ||||
Sep. 30, 2017 | Sep. 30, 2016 | Sep. 30, 2017 | Sep. 30, 2016 | Dec. 31, 2016 | ||
Segment gross profit | $ 420,598 | $ 85,359 | $ 841,303 | $ 192,796 | ||
Payroll | 272,900 | 30,739 | 457,288 | 95,986 | ||
Professional fees | 16,603 | 4,266 | 93,505 | 65,887 | ||
General and administrative expenses | 269,039 | 115,868 | 579,172 | 341,827 | ||
Depreciation | 90,512 | 16,041 | 234,654 | 32,971 | ||
Interest expense | 145,740 | 41,789 | 440,538 | 111,714 | ||
Change in fair value of derivative liability | 6,474 | (16,814) | (11,018) | 2,798 | ||
Loss on extinguishment of debt | (116,541) | (305,000) | (116,541) | |||
Loss before provision for income taxes | (380,670) | (223,071) | (1,257,836) | (574,928) | ||
Provision for income taxes | 1,600 | |||||
Net loss | (380,670) | (223,071) | (1,259,436) | (574,928) | ||
Total net property, plant, and equipment assets | 925,728 | 925,728 | $ 356,346 | |||
Monitoring [Member] | ||||||
Segment gross profit | [1] | 336,322 | 72,804 | 562,313 | 164,071 | |
Identifiable segment operating expenses | [2] | 86,543 | 5,911 | 143,955 | 21,468 | |
Identifiable segment operating income | [3] | 249,779 | 66,173 | 418,358 | 142,603 | |
Total net property, plant, and equipment assets | 562,542 | 127,815 | 562,542 | 127,815 | ||
Distributorships [Member] | ||||||
Segment gross profit | [1] | 84,276 | 13,275 | 278,990 | 28,725 | |
Identifiable segment operating expenses | [2] | 3,552 | 9,810 | 89,642 | 9,810 | |
Identifiable segment operating income | [3] | 80,724 | 3,465 | 189,348 | 18,915 | |
Total net property, plant, and equipment assets | 350,298 | 58,410 | 350,298 | 58,410 | ||
Operating Segment [Member] | ||||||
Segment gross profit | [1] | 420,598 | 85,359 | 841,303 | 192,796 | |
Identifiable segment operating expenses | [2] | 90,095 | 15,721 | 233,597 | 31,278 | |
Identifiable segment operating income | [3] | 330,503 | 69,638 | 607,706 | 161,518 | |
Payroll | [4] | 272,900 | 30,739 | 457,288 | 95,986 | |
Professional fees | [4] | 16,603 | 4,266 | 93,505 | 65,887 | |
General and administrative expenses | [4] | 269,039 | 115,868 | 579,172 | 341,827 | |
Depreciation | [4] | 417 | 320 | 1,057 | 1,693 | |
Interest expense | [4] | 145,740 | 41,790 | 440,538 | 111,715 | |
Change in fair value of derivative liability | [4] | 6,474 | (16,814) | (11,018) | 2,798 | |
Loss on extinguishment of debt | [4] | 116,541 | 305,000 | 116,541 | ||
Loss before provision for income taxes | (380,670) | (223,072) | (1,257,836) | (574,929) | ||
Provision for income taxes | 1,600 | |||||
Net loss | (380,670) | (223,072) | (1,259,436) | (574,929) | ||
Total net property, plant, and equipment assets | 925,729 | 188,824 | 925,729 | 188,824 | ||
Corporate [Member] | ||||||
Total net property, plant, and equipment assets | $ 12,889 | $ 2,599 | $ 12,889 | $ 2,599 | ||
[1] | Segment gross profit includes segment net sales less segment cost of sales | |||||
[2] | Identifiable segment operating expenses consists of identifiable depreciation expense | |||||
[3] | Identifiable segment operating income consists of segment gross profit less identifiable operating expense | |||||
[4] | General corporate expense consists of all other non-identifiable expenses |
Furniture and Equipment (Detail
Furniture and Equipment (Details Narrative) - USD ($) | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2017 | Sep. 30, 2016 | Sep. 30, 2017 | Sep. 30, 2016 | |
Depreciation expense | $ 90,512 | $ 16,041 | $ 234,654 | $ 32,971 |
Accumulated depreciation, disposal of asset | 14,211 | |||
Monitoring Units [Member] | ||||
Accumulated depreciation, disposal of asset | $ 27,200 |
Furniture and Equipment - Sched
Furniture and Equipment - Schedule of Furniture and Equipment (Details) - USD ($) | Sep. 30, 2017 | Dec. 31, 2016 |
Total assets | $ 1,214,522 | $ 424,696 |
Less: accumulated depreciation | (288,794) | (68,350) |
Furniture and equipment, net | 925,728 | 356,346 |
Monitoring Units [Member] | ||
Total assets | 1,198,057 | 419,898 |
Furniture, Fixtures, and Equipment [Member] | ||
Total assets | 4,798 | 4,798 |
Software [Member] | ||
Total assets | $ 11,667 |
Deposits - Schedule of Deposits
Deposits - Schedule of Deposits (Details) - USD ($) | Sep. 30, 2017 | Dec. 31, 2016 |
Deposit Assets Disclosure [Abstract] | ||
Deposit for BDI-747 units | $ 250,000 | |
Other | 5,131 | 6,254 |
Total | $ 5,131 | $ 256,254 |
Accrued Expenses - Schedule of
Accrued Expenses - Schedule of Accrued Expenses (Details) - USD ($) | Sep. 30, 2017 | Dec. 31, 2016 |
Payables and Accruals [Abstract] | ||
Accrued payroll taxes | $ 218,975 | $ 65,292 |
Miscellaneous | 16,423 | 3,503 |
Total | $ 235,398 | $ 68,795 |
Deferred Revenue - Schedule of
Deferred Revenue - Schedule of Deferred Revenue (Details) - USD ($) | Sep. 30, 2017 | Dec. 31, 2016 |
Deferred revenue | $ 98,057 | $ 162,331 |
Monitoring [Member] | ||
Deferred revenue | 91,057 | |
Distributorships [Member] | ||
Deferred revenue | $ 7,000 | |
Monitoring [Member] | ||
Deferred revenue | 103,831 | |
Distributorships [Member] | ||
Deferred revenue | $ 58,500 |
Notes Payable (Details Narrativ
Notes Payable (Details Narrative) | Nov. 01, 2017 | Aug. 03, 2017$ / shares | May 19, 2017USD ($) | Mar. 31, 2017shares | Mar. 16, 2017USD ($) | Feb. 27, 2017USD ($) | Jan. 15, 2017USD ($) | Nov. 04, 2016USD ($) | Nov. 02, 2016USD ($) | Nov. 01, 2016USD ($)$ / sharesshares | Sep. 30, 2016USD ($)shares | Sep. 23, 2016USD ($)shares | May 06, 2016USD ($)shares | Apr. 05, 2016USD ($)shares | Mar. 30, 2016USD ($)shares | Mar. 29, 2016USD ($) | Jan. 29, 2016USD ($) | Jan. 20, 2016USD ($) | Nov. 24, 2015USD ($)$ / sharesshares | Aug. 07, 2015USD ($)$ / sharesshares | Feb. 16, 2014USD ($)Installments | Sep. 30, 2017USD ($) | Sep. 30, 2016USD ($) | Sep. 30, 2017USD ($) | Sep. 30, 2016USD ($) | Dec. 31, 2016USD ($) | Jun. 30, 2017USD ($) | Dec. 18, 2015USD ($) |
Convertible debenture | $ 7,500 | $ 7,500 | ||||||||||||||||||||||||||
Conversion of debt value | $ 435,719 | |||||||||||||||||||||||||||
Expected dividend rate | 0.00% | |||||||||||||||||||||||||||
Volatility rate | 312.00% | |||||||||||||||||||||||||||
Risk free interest rate | 0.55% | |||||||||||||||||||||||||||
Amortization of debt discount | $ 275,465 | $ 89,109 | ||||||||||||||||||||||||||
Exchange in cash | 653,099 | |||||||||||||||||||||||||||
Loss on extinguishments of debt | $ (116,541) | $ (305,000) | (116,541) | |||||||||||||||||||||||||
Maximum [Member] | ||||||||||||||||||||||||||||
Expected term | 1 year 1 month 9 days | |||||||||||||||||||||||||||
Convertible Note 1 [Member] | ||||||||||||||||||||||||||||
Interest bearing percentage | 7.50% | |||||||||||||||||||||||||||
Convertible debenture | $ 15,000 | |||||||||||||||||||||||||||
Convertible debt due date | Aug. 7, 2017 | |||||||||||||||||||||||||||
Percent of loan convertible on trading days | 70.00% | |||||||||||||||||||||||||||
Discount on convertible debenture | $ 5,770 | |||||||||||||||||||||||||||
Conversion of debt value | $ 7,500 | |||||||||||||||||||||||||||
Conversion of debt into shares | shares | 30,000 | |||||||||||||||||||||||||||
Warrants outstanding | shares | 30,000 | |||||||||||||||||||||||||||
Warrants exercise price | $ / shares | $ 0.50 | |||||||||||||||||||||||||||
Expected term | 3 years | |||||||||||||||||||||||||||
Expected dividend rate | 0.00% | |||||||||||||||||||||||||||
Volatility rate | 100.00% | |||||||||||||||||||||||||||
Risk free interest rate | 1.08% | |||||||||||||||||||||||||||
Amortization of debt discount | $ 4,873 | |||||||||||||||||||||||||||
Convertible Note 2 [Member] | ||||||||||||||||||||||||||||
Interest bearing percentage | 10.00% | |||||||||||||||||||||||||||
Convertible debenture | $ 50,000 | |||||||||||||||||||||||||||
Convertible debt due date | Nov. 19, 2017 | |||||||||||||||||||||||||||
Percent of loan convertible on trading days | 70.00% | |||||||||||||||||||||||||||
Discount on convertible debenture | $ 32,897 | |||||||||||||||||||||||||||
Warrants outstanding | shares | 80,000 | |||||||||||||||||||||||||||
Warrants exercise price | $ / shares | $ 0.80 | |||||||||||||||||||||||||||
Expected term | 2 years | |||||||||||||||||||||||||||
Expected dividend rate | 0.00% | |||||||||||||||||||||||||||
Volatility rate | 100.00% | |||||||||||||||||||||||||||
Risk free interest rate | 0.61% | |||||||||||||||||||||||||||
Amortization of debt discount | $ 13,783 | |||||||||||||||||||||||||||
Debt conversion of convertible percentage | 9.90% | |||||||||||||||||||||||||||
Promissory Note 1 [Member] | ||||||||||||||||||||||||||||
Note for principal balance | $ 10,200 | |||||||||||||||||||||||||||
Company borrowed | $ 13,100 | |||||||||||||||||||||||||||
Promissory Note 2 [Member] | ||||||||||||||||||||||||||||
Note for principal balance | $ 44,850 | |||||||||||||||||||||||||||
Company borrowed | $ 28,600 | $ 28,600 | $ 28,600 | |||||||||||||||||||||||||
Exchange in cash | $ 29,505 | |||||||||||||||||||||||||||
Promissory Note 3 [Member] | ||||||||||||||||||||||||||||
Interest bearing percentage | 18.00% | |||||||||||||||||||||||||||
Convertible debt due date | Jun. 30, 2018 | |||||||||||||||||||||||||||
Amortization of debt discount | $ 50,000 | |||||||||||||||||||||||||||
Note for principal balance | $ 50,000 | |||||||||||||||||||||||||||
Restricted of common shares | shares | 50,000 | |||||||||||||||||||||||||||
Number of restricted shares issued for exchange for cash | $ 50,000 | $ 50,000 | ||||||||||||||||||||||||||
Number of restricted shares issued for exchange | shares | 50,000 | 50,000 | ||||||||||||||||||||||||||
Promissory Note 4 [Member] | ||||||||||||||||||||||||||||
Interest bearing percentage | 24.00% | |||||||||||||||||||||||||||
Convertible debt due date | Oct. 31, 2017 | |||||||||||||||||||||||||||
Amortization of debt discount | $ 10,000 | |||||||||||||||||||||||||||
Number of restricted shares issued for exchange for cash | $ 10,000 | |||||||||||||||||||||||||||
Number of restricted shares issued for exchange | shares | 100,000 | |||||||||||||||||||||||||||
Notes payable | $ 10,000 | |||||||||||||||||||||||||||
Promissory Note 5 [Member] | ||||||||||||||||||||||||||||
Interest bearing percentage | 25.00% | 25.00% | 25.00% | |||||||||||||||||||||||||
Convertible debt due date | Oct. 1, 2017 | |||||||||||||||||||||||||||
Number of restricted shares issued for exchange for cash | $ 36,100 | |||||||||||||||||||||||||||
Notes payable | 36,100 | $ 36,100 | $ 36,100 | |||||||||||||||||||||||||
Interest payments | 752 | |||||||||||||||||||||||||||
Payment terms, balloon payment | 36,100 | $ 36,100 | $ 36,100 | |||||||||||||||||||||||||
Periodic payments, principal | 15,000 | |||||||||||||||||||||||||||
Monthly fee | 10,000 | |||||||||||||||||||||||||||
Per month amount | $ 10,000 | |||||||||||||||||||||||||||
Promissory Note 6 [Member] | ||||||||||||||||||||||||||||
Interest bearing percentage | 25.00% | |||||||||||||||||||||||||||
Convertible debt due date | Nov. 1, 2018 | Nov. 1, 2017 | ||||||||||||||||||||||||||
Warrants outstanding | shares | 50,000 | |||||||||||||||||||||||||||
Warrants exercise price | $ / shares | $ 0.10 | |||||||||||||||||||||||||||
Expected term | 4 years | |||||||||||||||||||||||||||
Expected dividend rate | 0.00% | |||||||||||||||||||||||||||
Volatility rate | 329.00% | |||||||||||||||||||||||||||
Risk free interest rate | 1.56% | |||||||||||||||||||||||||||
Amortization of debt discount | $ 5,040 | |||||||||||||||||||||||||||
Number of restricted shares issued for exchange for cash | 5,040 | |||||||||||||||||||||||||||
Notes payable | 5,040 | |||||||||||||||||||||||||||
Interest payments | $ 105 | |||||||||||||||||||||||||||
Promissory Note 7 [Member] | ||||||||||||||||||||||||||||
Interest bearing percentage | 25.00% | |||||||||||||||||||||||||||
Convertible debt due date | Nov. 1, 2017 | |||||||||||||||||||||||||||
Number of restricted shares issued for exchange for cash | $ 24,960 | |||||||||||||||||||||||||||
Notes payable | 24,960 | |||||||||||||||||||||||||||
Interest payments | 520 | |||||||||||||||||||||||||||
Payment terms, balloon payment | 24,960 | |||||||||||||||||||||||||||
Periodic payments, principal | 15,000 | |||||||||||||||||||||||||||
Monthly fee | 10,000 | |||||||||||||||||||||||||||
Per month amount | $ 10,000 | |||||||||||||||||||||||||||
Promissory Note 8 [Member] | ||||||||||||||||||||||||||||
Interest bearing percentage | 25.00% | |||||||||||||||||||||||||||
Convertible debt due date | Nov. 1, 2019 | |||||||||||||||||||||||||||
Number of restricted shares issued for exchange for cash | $ 50,000 | |||||||||||||||||||||||||||
Notes payable | $ 50,000 | |||||||||||||||||||||||||||
Interest payments | 1,042 | |||||||||||||||||||||||||||
Payment terms, balloon payment | $ 50,000 | |||||||||||||||||||||||||||
Periodic payments, principal | 15,000 | |||||||||||||||||||||||||||
Monthly fee | 10,000 | |||||||||||||||||||||||||||
Per month amount | $ 10,000 | |||||||||||||||||||||||||||
Promissory Note 9 [Member] | ||||||||||||||||||||||||||||
Interest bearing percentage | 25.00% | |||||||||||||||||||||||||||
Convertible debt due date | Jan. 15, 2018 | |||||||||||||||||||||||||||
Number of restricted shares issued for exchange for cash | $ 50,400 | |||||||||||||||||||||||||||
Notes payable | 50,400 | |||||||||||||||||||||||||||
Interest payments | 1,042 | |||||||||||||||||||||||||||
Payment terms, balloon payment | 50,000 | |||||||||||||||||||||||||||
Periodic payments, principal | 15,000 | |||||||||||||||||||||||||||
Monthly fee | 10,000 | |||||||||||||||||||||||||||
Debt discount | 27,720 | |||||||||||||||||||||||||||
Per month amount | $ 10,000 | |||||||||||||||||||||||||||
Promissory Note 10 [Member] | ||||||||||||||||||||||||||||
Interest bearing percentage | 25.00% | |||||||||||||||||||||||||||
Convertible debt due date | Feb. 27, 2020 | |||||||||||||||||||||||||||
Number of restricted shares issued for exchange for cash | $ 70,000 | |||||||||||||||||||||||||||
Notes payable | 70,000 | |||||||||||||||||||||||||||
Interest payments | 1,458 | |||||||||||||||||||||||||||
Payment terms, balloon payment | 70,000 | |||||||||||||||||||||||||||
Periodic payments, principal | 15,000 | |||||||||||||||||||||||||||
Monthly fee | 10,000 | |||||||||||||||||||||||||||
Debt discount | 28,000 | |||||||||||||||||||||||||||
Per month amount | $ 10,000 | |||||||||||||||||||||||||||
Promissory Note 11 [Member] | ||||||||||||||||||||||||||||
Interest bearing percentage | 25.00% | |||||||||||||||||||||||||||
Convertible debt due date | Mar. 16, 2020 | |||||||||||||||||||||||||||
Number of restricted shares issued for exchange for cash | $ 75,000 | |||||||||||||||||||||||||||
Notes payable | 75,000 | |||||||||||||||||||||||||||
Interest payments | 1,563 | |||||||||||||||||||||||||||
Payment terms, balloon payment | 75,000 | |||||||||||||||||||||||||||
Periodic payments, principal | 15,000 | |||||||||||||||||||||||||||
Monthly fee | 10,000 | |||||||||||||||||||||||||||
Debt discount | 30,000 | |||||||||||||||||||||||||||
Per month amount | $ 10,000 | |||||||||||||||||||||||||||
Royalty Note 1 [Member] | Royalty Agreement [Member] | ||||||||||||||||||||||||||||
Restricted of common shares | shares | 425,000 | |||||||||||||||||||||||||||
Royalty note, description | The Company entered into Amendment No. 1 to Royalty note #1 in order to remove a security interest in the Companys assets to secure repayment of the original note and amend the royalty provisions of the original note to be $1 for each Device on the road beginning in the 25th month after the date of the original note. | |||||||||||||||||||||||||||
Loss on extinguishments of debt | $ 116,541 | |||||||||||||||||||||||||||
Royalty Note 1 [Member] | Royalty Agreement [Member] | Third Party [Member] | ||||||||||||||||||||||||||||
Company borrowed | $ 65,000 | |||||||||||||||||||||||||||
Royalty Note 1 [Member] | Royalty Agreement [Member] | Third Party [Member] | February 2017 [Member] | ||||||||||||||||||||||||||||
Amortization of debt discount | 65,000 | |||||||||||||||||||||||||||
Monthly fee | 937 | |||||||||||||||||||||||||||
Per month amount | 937 | |||||||||||||||||||||||||||
Repay of principal amount | 3,531 | |||||||||||||||||||||||||||
Pay to lender royalty fee per month | $ 5 | |||||||||||||||||||||||||||
Royalty note, description | The Company will pay the lender a royalty fee of five ($5) dollars per month for every ignition interlock devise that the Company has on the road in customers vehicles up to eight hundred (800) in perpetuity, and for every unit over 800, the Company will owe the lender $1 per month per device in perpetuity. | |||||||||||||||||||||||||||
Royalty Note 2 [Member] | Royalty Agreement [Member] | ||||||||||||||||||||||||||||
Amortization of debt discount | $ 8,959 | |||||||||||||||||||||||||||
Restricted of common shares | shares | 50,000 | |||||||||||||||||||||||||||
Interest payments | $ 4,000 | |||||||||||||||||||||||||||
Royalty note, description | The Company entered into Amendment No. 1 to Royalty note #2 to amend the royalty provisions of the original note to be $1 for each Device on the road beginning in the 25th month after the date of the Royalty note #2. | |||||||||||||||||||||||||||
Royalty Note 2 [Member] | Royalty Agreement [Member] | CEO [Member] | ||||||||||||||||||||||||||||
Company borrowed | $ 55,000 | |||||||||||||||||||||||||||
Royalty Note 2 [Member] | Royalty Agreement [Member] | April 2017 [Member] | CEO [Member] | ||||||||||||||||||||||||||||
Amortization of debt discount | 55,000 | |||||||||||||||||||||||||||
Monthly fee | 937 | |||||||||||||||||||||||||||
Per month amount | 937 | |||||||||||||||||||||||||||
Repay of principal amount | 3,531 | |||||||||||||||||||||||||||
Pay to lender royalty fee per month | $ 5 | |||||||||||||||||||||||||||
Royalty note, description | The Company will pay the lender a royalty fee of five ($5) dollars per month for every ignition interlock devise that the Company has on the road in customers vehicles up to eight hundred (800) in perpetuity, and for every unit over 800, the Company will owe the lender $1 per month per device in perpetuity. | |||||||||||||||||||||||||||
Royalty Note 3 [Member] | ||||||||||||||||||||||||||||
Acquire parts and supplies to manufacture devices, description | Under the terms of the LSA, the first phase will be a loan of up to $192,000 to acquire parts and supplies to manufacture 600 Devices; and the second phase will be a loan of up to $350,400 to acquire parts and supplies to manufacture 1,000 Devices. | |||||||||||||||||||||||||||
Royalty Note 3 [Member] | Doheny [Member] | October 7, 2016 [Member] | ||||||||||||||||||||||||||||
Stock issued during period, shares | shares | 845,913 | |||||||||||||||||||||||||||
Royalty Note 3 [Member] | Royalty Agreement [Member] | Doheny Group [Member] | ||||||||||||||||||||||||||||
Royalty amount for monthly calculation of per unit | $ / shares | $ 1.30 | |||||||||||||||||||||||||||
Royalty Note 3 [Member] | Loan and Security Agreement [Member] | First Phase [Member] | ||||||||||||||||||||||||||||
Interest bearing percentage | 25.00% | 25.00% | 25.00% | |||||||||||||||||||||||||
Maximum loan amount | $ 192,000 | |||||||||||||||||||||||||||
Royalty Note 3 [Member] | Loan and Security Agreement [Member] | Second Phase [Member] | ||||||||||||||||||||||||||||
Interest bearing percentage | 25.00% | 25.00% | 25.00% | |||||||||||||||||||||||||
Maximum loan amount | $ 350,400 | |||||||||||||||||||||||||||
Royalty Note 3 [Member] | Loan and Security Agreement [Member] | Doheny Group, LLC, Delaware Limited Liability [Member] | ||||||||||||||||||||||||||||
Royalty note, description | The Phase 1 Loan was funded in the amount of $192,000 by Doheny on September 30, 2016, upon which the Company forwarded the funds to its supplier on or about October 5, 2016, in order to acquire parts and supplies to manufacture 600 Devices. Both the Phase 1 Loan and the Phase 2 Loan mature three years from the date of funding, and are at an interest rate of 25% per annum. The note requires interest only payments of $4,000 per month. The Company can prepay the Phase 1 Loan and the Phase 2 Loan (if applicable) at any time without penalty. In exchange for Doheny funding the Phase 1 Loan, the Company issued Doheny a promissory note for $192,000 and also issued Doheny shares of common stock equal to 4.99% of the then-outstanding common stock, pursuant to the terms of a stock purchase agreement. As a result, on or about October 7, 2016, the Company issued Doheny 845,913 shares of common stock. In addition, upon funding of any portion of the Phase 2 loan (Royalty Note #4 below) then the Company is obligated to issue Doheny that number of additional shares of common stock that equals 5% of the then-outstanding common stock. Until the Company repays the Phase 1 Loan and the Phase 2 Loan, as applicable, Doheny has anti-dilution rights for the percentage of stock Doheny owns in the event the Company issues additional shares of common stock during that period. The Company also entered into a Royalty Agreement with Doheny, under which Doheny was granted perpetual royalty rights on all Devices when the Company has 500 or more Devices in service whether leased to end users or distributors. The royalty amounts vary between $1 and $2 per Device depending on a variety of factors. The Company recorded a debt discount of $192,000 related to the relative fair value of the issued shares associated with the Phase 1 note to be amortized over the life of the note. | |||||||||||||||||||||||||||
Maximum loan amount | $ 542,400 | |||||||||||||||||||||||||||
Royalty Note 3 [Member] | Stock Purchase Agreement[Member] | First Phase [Member] | ||||||||||||||||||||||||||||
Amortization of debt discount | $ 192,000 | |||||||||||||||||||||||||||
Outstanding common stock, percentage | 4.99% | |||||||||||||||||||||||||||
Royalty Note 3 [Member] | Stock Purchase Agreement[Member] | Second Phase [Member] | ||||||||||||||||||||||||||||
Outstanding common stock, percentage | 5.00% | |||||||||||||||||||||||||||
Royalty Note 4 [Member] | Royalty Agreement [Member] | Doheny Group [Member] | ||||||||||||||||||||||||||||
Royalty note, description | The Company agreed to fund an initial portion of the Phase 2 loan as described in Royalty note #3 above. In connection with this funding the common stock ownership percentage of Doheny Group was increased to 9.95%. As also described in Royalty note #3 above Doheny has anti-dilution privileges to maintain 9.95% of common stock ownership at no additional cost until both Royalty note #3 and Royalty note #4 are paid in full. As of December 31, 2016 the Company has drawn $325,000 out of the maximum allowance of $350,400 in connection with Royalty note #4. | |||||||||||||||||||||||||||
Loans payable | $ 325,000 | |||||||||||||||||||||||||||
Maximum allowance | $ 350,400 | |||||||||||||||||||||||||||
Royalty Note 4 [Member] | Royalty Agreement [Member] | Doheny Group [Member] | Maximum [Member] | ||||||||||||||||||||||||||||
Ownership percentage | 9.95% | |||||||||||||||||||||||||||
Related Party Promissory Note [Member] | Laurence Wainer [Member] | ||||||||||||||||||||||||||||
Interest bearing percentage | 7.75% | |||||||||||||||||||||||||||
Note for principal balance | $ 160,000 | |||||||||||||||||||||||||||
Monthly fee | 3,205 | |||||||||||||||||||||||||||
Per month amount | $ 3,205 | |||||||||||||||||||||||||||
Interest payable monthly installments | Installments | 60 | |||||||||||||||||||||||||||
Debt instrument, forgiveness | $ 45,000 | |||||||||||||||||||||||||||
Forgiveness of accrued salary | $ 25,537 | |||||||||||||||||||||||||||
Related Party Promissory Note [Member] | Laurence Wainer [Member] | Series A Preferred Stock [Member] | ||||||||||||||||||||||||||||
Conversion of debt into shares | shares | 1,000,000 | |||||||||||||||||||||||||||
Accrued salaries | $ 25,537 |
Notes Payable - Schedule of Not
Notes Payable - Schedule of Notes Payable (Details) - USD ($) | Sep. 30, 2017 | Dec. 31, 2016 |
Current portion | $ 154,069 | $ 125,351 |
Long-term portion | 148,250 | 17,708 |
Principal [Member] | ||
Total | 520,702 | 313,103 |
Current portion | 209,346 | 238,264 |
Long-term portion | 311,356 | 74,839 |
Accrued Interest [Member] | ||
Total | 41,078 | 10,110 |
Current portion | 41,078 | 10,110 |
Long-term portion | ||
Convertible Notes [Member] | Principal [Member] | ||
Total | 54,385 | 33,776 |
Convertible Notes [Member] | Accrued Interest [Member] | ||
Total | 2,242 | 1,648 |
Convertible Notes [Member] | Convertible Note 1 [Member] | Principal [Member] | ||
Debt discount | (3,104) | |
Total | 7,500 | 7,500 |
Convertible Notes [Member] | Convertible Note 1 [Member] | Accrued Interest [Member] | ||
Debt discount | ||
Total | 208 | 31 |
Convertible Notes [Member] | Convertible note 2 [Member] | Principal [Member] | ||
Debt discount | (3,115) | (20,620) |
Total | 50,000 | 50,000 |
Convertible Notes [Member] | Convertible note 2 [Member] | Accrued Interest [Member] | ||
Debt discount | ||
Total | 2,034 | 1,617 |
Promissory Notes [Member] | Principal [Member] | ||
Total | 302,320 | 143,058 |
Promissory Notes [Member] | Accrued Interest [Member] | ||
Total | 17,294 | 4,087 |
Promissory Notes [Member] | Promissory Note 1 [Member] | Principal [Member] | ||
Total | 990 | |
Promissory Notes [Member] | Promissory Note 1 [Member] | Accrued Interest [Member] | ||
Total | ||
Promissory Notes [Member] | Promissory Note 2 [Member] | Principal [Member] | ||
Debt discount | (3,510) | |
Total | 13,278 | |
Promissory Notes [Member] | Promissory Note 2 [Member] | Accrued Interest [Member] | ||
Debt discount | ||
Total | ||
Promissory Notes [Member] | Promissory Note 3 [Member] | Principal [Member] | ||
Debt discount | (13,542) | (32,292) |
Total | 50,000 | 50,000 |
Promissory Notes [Member] | Promissory Note 3 [Member] | Accrued Interest [Member] | ||
Debt discount | ||
Total | 1,500 | |
Promissory Notes [Member] | Promissory Note 4 [Member] | Principal [Member] | ||
Debt discount | (384) | (7,308) |
Total | 10,000 | 10,000 |
Promissory Notes [Member] | Promissory Note 4 [Member] | Accrued Interest [Member] | ||
Debt discount | ||
Total | 2,200 | 400 |
Promissory Notes [Member] | Promissory Note 5 [Member] | Principal [Member] | ||
Total | 36,100 | 36,100 |
Promissory Notes [Member] | Promissory Note 5 [Member] | Accrued Interest [Member] | ||
Total | 1,504 | 3,581 |
Promissory Notes [Member] | Promissory Note 6 [Member] | Principal [Member] | ||
Debt discount | (420) | (4,200) |
Total | 5,040 | 5,040 |
Promissory Notes [Member] | Promissory Note 6 [Member] | Accrued Interest [Member] | ||
Debt discount | ||
Total | 106 | |
Promissory Notes [Member] | Promissory Note 7 [Member] | Principal [Member] | ||
Total | 24,960 | 24,960 |
Promissory Notes [Member] | Promissory Note 7 [Member] | Accrued Interest [Member] | ||
Total | 2,629 | |
Promissory Notes [Member] | Promissory Note 8 [Member] | Principal [Member] | ||
Total | 50,000 | 50,000 |
Promissory Notes [Member] | Promissory Note 8 [Member] | Accrued Interest [Member] | ||
Total | 2,083 | |
Promissory Notes [Member] | Promissory Note 9 [Member] | Principal [Member] | ||
Debt discount | (8,085) | |
Total | 50,400 | |
Promissory Notes [Member] | Promissory Note 9 [Member] | Accrued Interest [Member] | ||
Debt discount | ||
Total | 1,050 | |
Promissory Notes [Member] | Promissory Note 10 [Member] | Principal [Member] | ||
Debt discount | (22,166) | |
Total | 70,000 | |
Promissory Notes [Member] | Promissory Note 10 [Member] | Accrued Interest [Member] | ||
Debt discount | ||
Total | 2,917 | |
Promissory Notes [Member] | Promissory Note 11 [Member] | Principal [Member] | ||
Debt discount | (24,583) | |
Total | 75,000 | |
Promissory Notes [Member] | Promissory Note 11 [Member] | Accrued Interest [Member] | ||
Debt discount | ||
Total | 3,411 | |
Royalty Notes [Member] | Principal [Member] | ||
Total | 163,997 | 38,520 |
Royalty Notes [Member] | Accrued Interest [Member] | ||
Total | 21,542 | 4,375 |
Royalty Notes [Member] | Royalty Note 1 [Member] | Principal [Member] | ||
Debt discount | (14,549) | (45,903) |
Total | 15,107 | 46,876 |
Royalty Notes [Member] | Royalty Note 1 [Member] | Accrued Interest [Member] | ||
Debt discount | ||
Total | ||
Royalty Notes [Member] | Royalty Note 2 [Member] | Principal [Member] | ||
Debt discount | (14,844) | (41,133) |
Total | 15,178 | 48,938 |
Royalty Notes [Member] | Royalty Note 2 [Member] | Accrued Interest [Member] | ||
Debt discount | ||
Total | ||
Royalty Notes [Member] | Royalty Note 3 [Member] | Principal [Member] | ||
Debt discount | (128,000) | (176,000) |
Total | 192,000 | 192,000 |
Royalty Notes [Member] | Royalty Note 3 [Member] | Accrued Interest [Member] | ||
Debt discount | ||
Total | 8,000 | |
Royalty Notes [Member] | Royalty Note 4 [Member] | Principal [Member] | ||
Debt discount | (225,894) | (311,258) |
Total | 325,000 | 325,000 |
Royalty Notes [Member] | Royalty Note 4 [Member] | Accrued Interest [Member] | ||
Debt discount | ||
Total | 13,542 | 4,375 |
Related Party Promissory Notes [Member] | Principal [Member] | ||
Total | 97,749 | |
Related Party Promissory Notes [Member] | Accrued Interest [Member] | ||
Total |
Derivative Financial Instrume46
Derivative Financial Instruments (Details Narrative) | 9 Months Ended |
Sep. 30, 2017USD ($) | |
Convertible debt outstanding | $ 7,500 |
Expected dividend rate | 0.00% |
Volatility | 312.00% |
Risk free interest rate | 0.55% |
Convertible Note [Member] | |
Convertible debt outstanding | $ 50,000 |
Minimum [Member] | |
Expected term | 10 months 6 days |
Maximum [Member] | |
Expected term | 1 year 1 month 9 days |
Derivative Financial Instrume47
Derivative Financial Instruments - Schedule of Derivative Liability (Details) - USD ($) | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2017 | Sep. 30, 2016 | Sep. 30, 2017 | Sep. 30, 2016 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | ||||
Derivative financial instruments | $ 73,556 | |||
Change in fair market value of derivative | $ (6,474) | $ 16,814 | 11,018 | $ (2,798) |
Derivative financial instruments | $ 62,537 | $ 62,537 |
Stockholders' Equity (Details N
Stockholders' Equity (Details Narrative) - USD ($) | 3 Months Ended | 9 Months Ended | |
Mar. 31, 2017 | Sep. 30, 2017 | Dec. 31, 2016 | |
Preferred stock, shares authorized | 20,000,000 | 20,000,000 | |
Preferred stock, par value | $ 0.001 | $ 0.001 | |
Number of preferred stock shares issued, value | $ 653,099 | ||
Preferred stock, shares issued | 1,000,000 | 0 | |
Common stock, shares authorized | 100,000,000 | 100,000,000 | |
Common stock, par value | $ 0.0001 | $ 0.0001 | |
Shares issued for services, value | $ 13,913 | ||
Conversion of debt value | $ 435,719 | ||
Number of stock sold during period | 1,072,536 | ||
Number of stock sold during period, value | $ 142,300 | ||
Common stock, shares issued | 24,057,961 | 19,575,605 | |
Royalty Notes [Member] | |||
Number of stock sold during period | 447,914 | ||
Common Stockholders [Member] | |||
Common stock voting rights | Holders of common stock are entitled to one vote for each share held. | ||
Shares issued for services, shares | 27,180 | ||
Per share price | $ 0.001 | ||
Shares issued for services, value | $ 13,913 | ||
Conversion of debt into shares | 195,400 | ||
Conversion of debt value | $ 85,720 | ||
Number of stock sold during period | 3,737,154 | ||
Number of stock sold during period, value | $ 653,098 | ||
Common stock, shares issued | 24,057,961 | ||
Series A Preferred Stock [Member] | |||
Preferred stock, shares authorized | 1,000,000 | ||
Preferred stock, voting rights | Series A Preferred stock will have one hundred (100) votes on all matters | ||
Series A Preferred Stock [Member] | Material Definitive Agreement [Member] | Officer and Director [Member] | |||
Number of preferred stock shares issued | 1,000,000 | ||
Number of preferred stock shares issued, value | $ 350,000 |
Warrants (Details Narrative)
Warrants (Details Narrative) - Warrant [Member] | 9 Months Ended |
Sep. 30, 2017$ / sharesshares | |
Warrant exercise price | $ 1 |
Warrants issued for service rendered | shares | 1,000 |
Expected Term | 4 years |
Expected Dividend Rate | 0.00% |
Volatility | 286.00% |
Risk Free Interest Rate | 1.54% |
Minimum [Member] | |
Warrant expiration | 3 years |
Warrant exercise price | $ 0.10 |
Maximum [Member] | |
Warrant expiration | 4 years |
Warrant exercise price | $ 0.35 |
Warrants - Schedule of Warrant
Warrants - Schedule of Warrant Activity (Details) - Warrant [Member] - USD ($) | 9 Months Ended | 12 Months Ended | |
Sep. 30, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Warrants for common shares, outstanding, beginning balance | 160,000 | 110,000 | |
Warrants for common shares, granted | 4,977,298 | 50,000 | 110,000 |
Warrants for common shares, exercised | |||
Warrants for common shares, forfeited, cancelled, expired | |||
Warrants for common shares, outstanding, ending balance | 5,137,298 | 160,000 | 110,000 |
Weighted average exercise price, beginning balance | $ 0.53 | $ 0.72 | |
Weighted average exercise price, granted | 0.46 | 0.10 | 0.72 |
Weighted average exercise price, exercised | |||
Weighted average exercise price, forfeited, cancelled, expired | |||
Weighted average exercise price, ending balance | $ 0.46 | $ 0.53 | $ 0.72 |
Weighted Average Remaining Contractual Term | 1 year 11 months 19 days | 2 years 1 month 6 days | |
Weighted Average Remaining Contractual Term, Granted | 4 years | 4 years | 2 years 3 months 8 days |
Weighted Average Remaining Contractual Term | 3 years 4 months 17 days | 1 year 11 months 19 days | 2 years 1 month 6 days |
Weighted Average Aggregate Intrinsic Value | $ 5,250 | ||
Weighted Average Aggregate Intrinsic Value, Granted | 407,614 | ||
Weighted Average Aggregate Intrinsic Value | $ 412,864 | $ 5,250 |
Income (Loss) Per Share - Sched
Income (Loss) Per Share - Schedule of Antidilutive Securities Excluded from Computation of Earnings Per Share (Details) - shares | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2017 | Sep. 30, 2016 | Sep. 30, 2017 | Sep. 30, 2016 | |
Total anti-dilutive weighted average shares | 5,512,380 | 304,008 | 5,512,380 | 315,737 |
Preferred Shares [Member] | ||||
Total anti-dilutive weighted average shares | ||||
Convertible Notes [Member] | ||||
Total anti-dilutive weighted average shares | 375,082 | 194,008 | 375,082 | 205,737 |
Warrant [Member] | ||||
Total anti-dilutive weighted average shares | 5,137,298 | 110,000 | 5,137,298 | 110,000 |
Options [Member] | ||||
Total anti-dilutive weighted average shares |
Income (Loss) Per Share - Sch52
Income (Loss) Per Share - Schedule of Dilutive Securities of Common Shares Outstanding (Details) | 9 Months Ended |
Sep. 30, 2017shares | |
Total potential shares | 29,570,341 |
Common Shares [Member] | |
Total potential shares | 24,057,961 |
Preferred Shares [Member] | |
Total potential shares | |
Convertible Notes [Member] | |
Total potential shares | 375,082 |
Warrant [Member] | |
Total potential shares | 5,137,298 |
Options [Member] | |
Total potential shares |
Commitments and Contingencies (
Commitments and Contingencies (Details Narrative) - USD ($) | Aug. 28, 2017 | Dec. 02, 2016 |
Lease term | 4 years | |
Lease amount for per month | $ 2,200 | |
Maximum provision for escalating | $ 2,404 | |
B3 Investments, LLC [Member] | ||
Lease term | 1 year | |
Lease amount for per month | $ 1,350 | |
Lease description | The Company entered into a one-year lease with B3 Investments, LLC for a storefront location at Suites D104 and D105, 2406 24th Street, South Phoenix, Arizona. Base rent under the lease is $1,350 per month plus 2% ($27) rental tax. | |
Rental tax | $ 27 | |
Percentage of rental tax rate | 2.00% |
Settlement with Distributor (De
Settlement with Distributor (Details Narrative) - Distributor Member [Member] - Distributorship Agreement [Member] | Sep. 30, 2017USD ($)Installments |
Number of interlock units | Installments | 900 |
Distributor revenue and accounts receivable | $ | $ 35,979 |
Subsequent Events (Details Narr
Subsequent Events (Details Narrative) - USD ($) | Nov. 01, 2017 | Sep. 30, 2017 |
Sale of stock, number of shares issued in transaction | 1,072,536 | |
Sale of stock, consideration | $ 142,300 | |
Number of warrants issued to purchase shares of common stock | 284,600 | |
Subsequent Event [Member] | Loan Agreement [Member] | Joseph Haridim [Member] | ||
Loan due date | Nov. 1, 2018 | |
Subsequent Event [Member] | Doheny Group [Member] | Loan Agreement [Member] | ||
Loan term | 60 months | |
Loan, monthly payment | $ 25,000 | |
Loan, principal payment | 15,000 | |
Monthly fee amount | $ 10,000 |