Document and Entity Information
Document and Entity Information - shares | 6 Months Ended | |
Dec. 31, 2015 | Feb. 20, 2016 | |
Document And Entity Information | ||
Entity Registrant Name | Life Clips, Inc. | |
Entity Central Index Key | 1,604,930 | |
Document Type | 10-Q | |
Document Period End Date | Dec. 31, 2015 | |
Amendment Flag | false | |
Current Fiscal Year End Date | --06-30 | |
Entity Filer Category | Smaller Reporting Company | |
Entity Common Stock, Shares Outstanding | 53,332,576 | |
Trading Symbol | LCLP | |
Document Fiscal Period Focus | Q2 | |
Document Fiscal Year Focus | 2,016 |
Balance Sheets
Balance Sheets - USD ($) | Dec. 31, 2015 | Jun. 30, 2015 |
Current assets | ||
Cash | $ 206,341 | $ 2,644 |
Due from related party | 2,713 | |
Total current assets | $ 206,341 | $ 5,357 |
Other Current Assets | ||
Inventory - Cameras | 42,500 | |
Total other current assets | 42,500 | |
Total Current Assets | 248,841 | $ 5,357 |
Fixed Assets | ||
Developed Software | 88,957 | 40,600 |
Total Fixed Assets | 88,957 | 40,600 |
Total assets | 337,798 | 45,957 |
Current liabilities | ||
Accrued expense | 1,843 | $ 4,066 |
Accrued Interest | 7,507 | |
Current liabilities | 9,350 | $ 4,066 |
Note Payable (net of discount of $0 and $46,129, respecively) | 50,500 | $ 38,871 |
Convertible Notes Payable (Net of debt discount of $783,219.) | 84,358 | |
Payroll Tax Liabilities | 9,042 | |
Total Other Current Liabilities | 143,900 | $ 38,871 |
Total Current Liabilities | 153,250 | $ 42,937 |
Derivative Liability - Convertible Notes Payable | 5,571,030 | |
Total Liabilities | $ 5,724,280 | $ 42,937 |
Stockholders' Equity (Deficit) | ||
Preferred stock, ($0.001 par value; 20,000,000 shares authorized, no shares issued or outstanding as of December 31, 2015 and June 30, 2015, respectively) | ||
Common stock, ($0.001 par value; 320,000,000 shares authorized, 53,332,620 and 38,037,120 shares issued and outstanding as of December 31, 2015 and June 30, 2015, respectively) | $ 53,332 | $ 38,037 |
Additional paid in capital | 304,666 | 665,283 |
Accumulated deficit | (5,744,480) | (700,300) |
Total shareholders' deficit | (5,386,482) | 3,020 |
Total liabilities and shareholders' deficit | $ 337,798 | $ 45,957 |
Balance Sheets (Parenthetical)
Balance Sheets (Parenthetical) - USD ($) | Dec. 31, 2015 | Jun. 30, 2015 |
Statement of Financial Position [Abstract] | ||
Note Payable, net of discount | $ 0 | $ 46,129 |
Convertible Notes Payable, net of discount | $ 783,219 | |
Preferred stock, par value | $ 0.001 | $ 0.001 |
Preferred stock, shares authorized | 20,000,000 | 20,000,000 |
Preferred stock, shares issued | 0 | 0 |
Preferred stock, shares outstanding | 0 | 0 |
Common stock, par value | $ 0.001 | $ 0.001 |
Common stock, shares authorized | 320,000,000 | 320,000,000 |
Common stock, shares issued | 53,332,620 | 38,037,120 |
Common stock, shares outstanding | 53,332,620 | 38,037,120 |
Statements of Operations (Unaud
Statements of Operations (Unaudited) - USD ($) | 3 Months Ended | 6 Months Ended | ||||
Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2015 | Dec. 31, 2014 | |||
Revenues | ||||||
Revenues | $ 22 | |||||
Cost of good sold | ||||||
Gross profit | $ 22 | |||||
Operating costs: | ||||||
Compensation paid with stock | $ 10,150 | $ 10,150 | ||||
Finance Costs | 33,935 | 33,935 | ||||
Payroll Expense | 57,712 | 57,712 | ||||
Product Development Expense | 23,360 | 23,360 | ||||
Professional Fees | 5,699 | 5,699 | ||||
Travel | 8,635 | 15,338 | $ 1,957 | |||
Other general and administrative expenses | 12,818 | $ 7,446 | 55,397 | 7,615 | ||
Total operating costs | 152,309 | 7,446 | 201,591 | 9,572 | ||
(Loss) from operations | $ (152,309) | $ (7,446) | (201,591) | $ (9,550) | ||
Other income (expense) | ||||||
Interest expense | (8,649) | |||||
Amortization of Debt Discount | $ (98,738) | (130,488) | ||||
Loss on Derivative | (4,703,452) | (4,703,452) | ||||
Total Other Income (Expense) | (4,802,190) | (4,842,589) | ||||
(Loss) before income taxes | $ (4,954,499) | $ (7,446) | $ (5,044,180) | $ (9,550) | ||
Provision for income taxes | ||||||
Net (loss) | $ (4,954,499) | $ (7,446) | $ (5,044,180) | $ (9,550) | ||
Basic earnings per share | $ (0.09) | [1] | $ (0.10) | [1] | ||
Weighted average number of common shares outstanding | 53,263,276 | 38,037,120 | 51,702,948 | 38,037,120 | ||
[1] | Less than $0.01 |
Statements of Cash Flows (Unaud
Statements of Cash Flows (Unaudited) - USD ($) | 6 Months Ended | |
Dec. 31, 2015 | Dec. 31, 2014 | |
Cash flows from operating activities: | ||
Net (loss) | $ (5,044,180) | $ (9,550) |
Common stock compensation | 10,150 | |
Changes in derivative liabilities | 4,703,452 | |
Amortization of Debt discount | 130,488 | |
Adjustments to reconcile Net Income to Net Cash provided by operations: | ||
Inventory - Cameras | (42,500) | |
Due from related party | 2,712 | |
Accrued expense | (6,594) | |
Accrued interest payable | 7,507 | |
Payroll tax liabilities | 9,042 | |
Net cash (used in) operating activities | (229,923) | $ (9,551) |
Cash flows from investing activities: | ||
Developed software | (88,957) | |
Net cash (used in) provided by investing activities | (88,957) | |
Cash flows from financing activities: | ||
Repurchased of common stock | $ (345,000) | $ 3,000 |
Loans payable - Gruder | $ 6,566 | |
Proceed from convertible notes payables | $ 867,577 | |
Net cash provided by financing activities | 522,577 | $ 9,566 |
Net cash increased in cash | 203,697 | 15 |
Cash at beginning of period | 2,644 | 5 |
Cash at end of period | $ 206,341 | $ 20 |
Supplemental Disclosures of cash flow information: | ||
Interest | ||
Income taxes |
Organization and Operations
Organization and Operations | 6 Months Ended |
Dec. 31, 2015 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Organization and Operations | NOTE 1. ORGANIZATION AND OPERATIONS Business and basis of presentation Life Clips is in business to provide consumers with an alternative way to capture, manage, share, broadcast and enjoy situational life experiences. Our core business is to allow individuals to capture and use content. We develop hardware and software solutions to provide individuals a rugged video device which allows consumers to record and take pictures in situations where mobile devices would be prone to breakage. The device can then help users with managing, sharing and enjoying engaging content. The Company was in the business of developing, production and distributing motion pictures. The Company entered into a merger and exchange agreement on October 2 nd On November 3, 2015, the Companys name changed from Blue Sky Media Corporation to Life Clips, Inc. Capture Our capture devices create excellent quality videos and pictures at affordable prices. We design our products to be small and very easy to use. However, our primary focus is to create a durable design that can be used in many rigorous situations. All of our devices have can be controlled by a remote control app on a mobile phone using the iOS or Android operating system with the Life Clips Camera App. Stream All of our devices allow users to seamlessly store video to the cloud and/or broadcast events live by streaming. We seek to eliminate the pain of transferring footage from their cameras to a PC/phone and then to an app. Our App allows full camera control from a mobile device and the Life Clips App enables a customer to allow its friends or business associates to watch their event live but remotely while they are doing it. Share By making the capture seamless, we believe that management and editing of photos and videos will be much easier. Cloud based storage will provide a simple way to keep memories without using local storage on your phone. Our App also allows videos to be sent directly to leading social networks and content platforms, including Facebook, Instagram, Pinterest, Twitter, Vimeo and YouTube. The Company anticipates releasing its first products in March or April of 2016. The Company anticipates raising capital for the release of these products by selling equity or acquiring debt. On October 2, 2015, the Company completed a stock merger and exchange agreement with Klear Kapture, Inc. (Klear Kapture). Pursuant to the terms of the Share Exchange Agreement, the Company agreed to issue 380,037,120 shares of its unregistered common stock to the shareholders of Klear Kapture in exchange for 10,000 shares of its common stock, representing 100% of its issued and outstanding common stock (the Share Exchange). As part of the Share Exchange, the Company purchased 107,261,000 shares of our common stock from its former executive officers and directors for a price of approximately $ 0.0032 per share (an aggregate of $345,000). Upon the effective date of the transaction, Klear Kapture became a wholly owned subsidiary of Life Clips and our pro-forma shares of common stock outstanding, giving effect to the repurchase of shares from its former executive officers and directors, was 53,332,620. Concurrent with the closing of the Share Exchange on October 2, 2015, Life Clips issued to three accredited investors, a $617,578 aggregate principal amount 3.85% Convertible Note (the Convertible Note). The issuance and sale of the Convertible Note was not registered under the Securities Act at the time of sale and, therefore, may not be offered or sold in the United States absent registration or an applicable exemption from registration requirements. The Notes are entitled to convert to an aggregate of 26,426,620 shares of common stock. |
Summary of Significant Accounti
Summary of Significant Accounting Policies | 6 Months Ended |
Dec. 31, 2015 | |
Accounting Policies [Abstract] | |
Summary of Significant Accounting Policies | NOTE 2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Use of estimates Cash and cash equivalents Income Tax Basic and Diluted Net Income (Loss) Per Share Intangible Asset Fair Value of Financial Instruments The Company measures assets and liabilities at fair value based on an expected exit price as defined by the authoritative guidance on fair value measurements, which represents the amount that would be received on the sale of an asset or paid to transfer a liability, as the case may be, in an orderly transaction between market participants. As such, fair value may be based on assumptions that market participants would use in pricing an asset or liability. The authoritative guidance on fair value measurements establishes a consistent framework for measuring fair value on either a recurring or nonrecurring basis whereby inputs, used in valuation techniques, are assigned a hierarchical level. The following are the hierarchical levels of inputs to measure fair value: ● Level 1 Observable inputs that reflect quoted market prices in active markets for identical assets or liabilities. ● Level 2 Inputs reflect quoted prices for identical assets or liabilities in markets that are not active; quoted prices for similar assets or liabilities in active markets; inputs other than quoted prices that are observable for the assets or liabilities; or inputs that are derived principally from or corroborated by observable market data by correlation or other means. ● Level 3 Unobservable inputs reflecting the Companys assumptions incorporated in valuation techniques used to determine fair value. These assumptions are required to be consistent with market participant assumptions that are reasonably available. The carrying amounts of the Companys financial assets and liabilities, such as cash, prepaid expenses, other current assets, accounts payable & accrued expenses, certain notes payable and notes payable related party, approximate their fair values because of the short maturity of these instruments. The Company accounts for its derivative liabilities, at fair value, on a recurring basis under level 3. See Note 8. Embedded Conversion Features The Company evaluates embedded conversion features within convertible debt under ASC 815 Derivatives and Hedging to determine whether the embedded conversion feature(s) should be bifurcated from the host instrument and accounted for as a derivative at fair value with changes in fair value recorded in earnings. If the conversion feature does not require derivative treatment under ASC 815, the instrument is evaluated under ASC 470-20 Debt with Conversion and Other Options for consideration of any beneficial conversion feature. Derivative Financial Instruments The Company does not use derivative instruments to hedge exposures to cash flow, market, or foreign currency risks. The Company evaluates all of its financial instruments, including stock purchase warrants, to determine if such instruments are derivatives or contain features that qualify as embedded derivatives. For derivative financial instruments that are accounted for as liabilities, the derivative instrument is initially recorded at its fair value and is then re-valued at each reporting date, with changes in the fair value reported as charges or credits to income. For option-based simple derivative financial instruments, the Company uses the Black-Scholes option-pricing model to value the derivative instruments at inception and subsequent valuation dates. The classification of derivative instruments, including whether such instruments should be recorded as liabilities or as equity, is re-assessed at the end of each reporting period. Debt Issue Costs and Debt Discount The Company may record debt issue costs and/or debt discounts in connection with raising funds through the issuance of debt. These costs may be paid in the form of cash, or equity (such as warrants). These costs are amortized to interest expense over the life of the debt. If a conversion of the underlying debt occurs, a proportionate share of the unamortized amounts is immediately expensed. Stock based compensation The Company accounts for stock based compensation issued to nonemployees and consultants in accordance with the provisions of ASC 50550 Equity Based Payments to NonEmployees which codified SFAS 123 and the Emerging Issues Task Force consensus in Issue No. 9618, Accounting for Equity Instruments that are Issued to Other Than Employees for Acquiring or in Conjunction with Selling, Goods or Services. Measurement of share based payment transactions with nonemployees shall be based on the fair value of whichever is more reliably measurable: (a) the goods or services received; or (b) the equity instruments issued. The fair value of the share based payment transaction should be determined at the earlier of performance commitment date or performance completion date. Common Stock Preferred Stock Recognition of Revenues Subsequent Events Pursuant to ASU 2010-09 of the FASB Accounting Standards Codification, the Company as an SEC filer considers its financial statements issued when they are widely distributed to users, such as through filing them on EDGAR. Recent Pronouncements In April 2015, the Financial Accounting Standards Board (FASB) issued Update 2015-03 Interest-Imputation of Interest (Subtopic 835-30):Simplifying the Presentation of Debt Issuance Costs. In December 2014, FASB issued Accounting Standards Update (ASU) No. 2014-18 Business Combinations (Topic 805): Accounting for Identifiable Intangible Assets in a Business Combination In January 2015, FASB issued Update No. 2015-01 Income StatementExtraordinary and Unusual Items (Subtopic 225-20): Simplifying Income Statement Presentation by Eliminating the Concept of Extraordinary Items. The Company reviewed all recent accounting pronouncements issued by the FASB (including its Emerging Issues Task Force), the AICPA, and the SEC and they did not or are not believed by management to have a material impact on the Companys present or future financial statements. |
Uncertainty of Ability to Conti
Uncertainty of Ability to Continue as a Going Concern | 6 Months Ended |
Dec. 31, 2015 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Uncertainty of Ability to Continue as a Going Concern | NOTE 3. UNCERTAINTY OF ABILITY TO CONTINUE AS A GOING CONCERN The accompanying financial statements have been prepared on a going concern basis, which contemplates the realization of assets and the settlement of liabilities and commitments in the normal course of business. As reflected in the accompanying financial statements, the Company has minimal revenues, net accumulated losses since inception and a shareholders deficit of $(5,744,480). These factors raise doubt about its ability to continue as a going concern. The ability of the Company to continue as a going concern is dependent on management funding operating costs and the successful production and sales release of the Life Clips camera. The financial statements do not include any adjustments that might be necessary if the Company is unable to continue as a going concern. |
Related Party Transactions
Related Party Transactions | 6 Months Ended |
Dec. 31, 2015 | |
Related Party Transactions [Abstract] | |
Related Party Transactions | NOTE 4. RELATED PARTY TRANSACTIONS At December 31, 2015 and June 30, 2015, a major shareholder owed the Company $-0- and $2,713, respectively. |
Intangible Assets
Intangible Assets | 6 Months Ended |
Dec. 31, 2015 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Intangible Assets | NOTE 5. INTANGIBLE ASSETS The Company is developing software. The development cost through December 31, 2015 has totaled $88,957. The software has an infinite useful life and will be tested annually for impairment. December 31, 2015 June 30, 2015 Software $ 88,957 $ 40,600 Less: Impairment Charges Less: Accumulated Amortization Patents - net $ 88,957 $ 40,600 |
Notes Payable
Notes Payable | 6 Months Ended |
Dec. 31, 2015 | |
Debt Disclosure [Abstract] | |
Notes Payable | NOTE 6. NOTES PAYABLE At December 31, 2015 and June 30, 2015 the Company had notes payable in the amount of $50,500 and $85,500 respectively. The notes mature on January 5, 2016. As of December 31, 2015 these notes were not in default. However, on January 5, 2016 the Company did not make its final payment. The notes are not secured by any Company assets but are presently in default. |
Convertible Debt - Net
Convertible Debt - Net | 6 Months Ended |
Dec. 31, 2015 | |
Debt Disclosure [Abstract] | |
Convertible Debt - Net | NOTE 7. CONVERTIBLE DEBT - NET The Company has recorded derivative liabilities associated with convertible debt instruments, as more fully discussed at Note 8. Third Party Balance June 30, 2015 $ - Proceeds 867,578 Repayments - Less: gross debt discount recorded (867,578 ) Add: Amortization of Debt Discount 84,359 Less Current portion - Long-Term Convertible Debt $ 84,358 On October 2, 2014, the Company completed an offering of its 3.85% Convertible Promissory Notes (the 3.85% Notes) in the aggregate principal amount of $617,578 and on December 7, 2015 the Company completed an offering of its 10% Convertible Promissory Notes (the 10% Notes) in the aggregate principal amount of $250,000 (the 10% Notes, and together with the 3.85% Notes, each a Note and collectively, the Notes), as applicable, with certain accredited investors (the Investors), as defined under Regulation D, Rule 501 of the Securities Act. The entire aggregate principal amount of the Notes of $867,578 was outstanding as of December 31, 2015, such amount being exclusive of securities converted into the Notes separate from the offering of the Notes. Pursuant to the offering of the Notes, the Company received $617,578 and $250,000 in net proceeds on October 2, 2015 and December 7, 2015, respectively. In addition to the terms customarily included in such instruments, the Notes began accruing interest on the date that each Investor submitted the principal balance of such Investors Note, with the interest thereon becoming due and payable on the two year anniversary of said date. Upon a default of the Notes, the interest rate will increase to 18%. The principal balance of each Note and all unpaid interest will become due and payable twenty-four (24) months after the date of issuance. The Notes may be prepaid with or without a penalty depending on the date of the prepayment. The principal and interest under the 3.85% Notes are converted at $0.017 or $0.026. The principal and interest under the 10% Notes are convertible into shares of the Companys common stock at 75% times the Volume Weighted Average Price for a 5 days period prior to the conversion date as quoted on the OTC market and pursuant to the terms of a Security Purchase Agreement, dated as of October 2, 2015 and December 7, 2015, as applicable, by and between the Company and each Investor. In connection with the Notes Offering, the Company entered into Registration Rights Agreements, each dated as of October 2, 2015 and December 7, 2015 and each by and between us and each of the Investors. (B) Terms of Debt The debt carries interest between 3.85% and 10%, and is due in October 2017 and December 2017. All convertible debt in connection with the Notes Offering are convertible at $0.017, $0.026 and $0.15/share (on December 31, 2015), however, the Notes include a ratchet feature, which allows for a lower offering price based on market prices. (C) Future Commitments At December 31, 2015, the Company has outstanding convertible debt of $867,578 which is payable within the next twenty-four months. |
Derivative Liabilities
Derivative Liabilities | 6 Months Ended |
Dec. 31, 2015 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
Derivative Liabilities | NOTE 8. DERIVATIVE LIABILITIES The Company identified conversion features embedded within convertible debt issued in 2015. The Company has determined that the features associated with the embedded conversion option, in the form a ratchet provision, should be accounted for at fair value, as a derivative liability, as the Company cannot determine if a sufficient number of shares would be available to settle all potential future conversion transactions. As a result of the application of ASC No. 815, the fair value of the ratchet feature related to convertible debt and warrants is summarized as follow: December 31, 2015 June 30, 2015 Fair value at the commitment date - convertible debt $ 2,633,514 $ - Fair value mark to market adjustment - convertible debt 2,937,516 - Totals $ 5,571,030 $ - The fair value at the commitment and re-measurement dates for the Companys derivative liabilities were based upon the following management assumptions as December 31, 2015: Commitment Date Re-measurement Date Expected dividends 0 % 0 % Expected volatility 220 % 259 % Expected term 2 years 1.65-1.92 years Risk free interest rate 0.58% - 0.94 % 1.06% - 1.06 % |
Debt Discount
Debt Discount | 6 Months Ended |
Dec. 31, 2015 | |
Debt Disclosure [Abstract] | |
Debt Discount | NOTE 9. DEBT DISCOUNT The Company recorded the debt discount to the extent of the gross proceeds raised, and expensed immediately the remaining fair value of the derivative liability, as it exceeded the gross proceeds of the note. The Company recorded a derivative expense of $4,703,452 and $0 for the three-months ended December 31, 2015 and 2014 respectively and $4,703,452 and $0 for the six-months ended December 31, 2015 and 2014. Accumulated amortization of derivative discount amounted to $84,359 as of December 31, 2015 and $0 for the year ended June 30, 2015. |
Debt Issue Cost
Debt Issue Cost | 6 Months Ended |
Dec. 31, 2015 | |
Debt Disclosure [Abstract] | |
Debt Issue Cost | NOTE 10. DEBT ISSUE COST Balance- June 30, 2015 $ 46,129 Amortization (46,129 ) Balance- December 31, 2015 - The Company recorded amortization expense of $14,379 and $0 for the three-months ended December 31, 2015 and 2014 respectively and $46,129 and $0 for the six-months ended December 31, 2015 and 2014, respectively. |
Common Stock
Common Stock | 6 Months Ended |
Dec. 31, 2015 | |
Equity [Abstract] | |
Common Stock | NOTE 11. COMMON STOCK On October 2, 2015 (the Effective Date) the Company entered into and closed on a merger and exchange agreement (the Share Exchange Agreement) with Klear Kapture in an effort to expand its current line of business. Klear Kapture has developed a body camera and an auditable software solution suitable for use by law enforcement that it intends to produce, market and sell. Following the closing of the Share Exchange Agreement, we intend to continue Klear Kaptures historical business and proposed business and have entered into a services agreement with our former executive officers and directors to operate our film marketing, distribution and production video and APP development businesses pursuant to the terms of a Services Agreement dated October 2, 2015 (the Services Agreement). However, we no longer intend to operate the pre-transaction business of the Company. Pursuant to a consulting agreement with a non-related third party, we issued 3,190,000 shares on October 2, 2015 for a price of approximately $0.00318 per share (an aggregate of $10,150), which was recorded as consulting services. On December 15, 2015, the Company filed Articles of Amendment to authorize 320,000,000 shares of common stock, par value $0.001 per share, to authorize 20,000,000 share of preferred stock, par value $0.001 per share, and to execute a 11:1 forward stock split. All common stock and per share date for the period presented in this Quarterly Report on Form 10-Q has been adjusted to give effect to the forward stock split. Pursuant to the terms of the Share Exchange Agreement, as of the Effective Date, we agreed to issue 38,037,120 shares of our unregistered common stock to the shareholders of Klear Kapture in exchange for 10,000 shares of its common stock, representing 100% of its issued and outstanding common stock in the Share Exchange. As part of the Share Exchange, we purchased 107,261,000 shares of our common stock from our former executive officers and directors for a price of approximately $ 0.00318 per share (an aggregate of $345,000). Upon the Effective Date, Klear Kapture became a wholly owned subsidiary of our company and our pro-forma shares of common stock outstanding giving effect to the repurchase of shares from our former executive officers and directors is 53,343,620. Robert Gruder who was appointed as our Chief Executive Officer and a Director in connection with the Share Exchange received 30,296,563 shares of our common stock in exchange for 7,965 shares Klear Kaptures common stock he previously owned. Mr. Gruders ownership of our common stock represents approximately 56.8% of our issued and outstanding shares of common stock. Other than as part of the Share Exchange, there were no stock issuances for the six month period ended December 31, 2014. |
Pro Forma Financial Data
Pro Forma Financial Data | 6 Months Ended |
Dec. 31, 2015 | |
Pro Forma Financial Data | |
Pro Forma Financial Data | NOTE 12. PRO FORMA FINANCIAL DATA On the Effective Date, the Company entered into and closed the Share Exchange Agreement with Klear Kapture in an effort to expand its current line of business. Klear Kapture has developed a body camera and an auditable software solution suitable for use by law enforcement that it intends to produce, market and sell. Following the closing of the Share Exchange Agreement, we intend to continue Klear Kaptures historical business and proposed business and have entered into a services agreement with our former executive officers and directors to operate our film marketing, distribution and production video and APP development businesses pursuant to the terms of the Services Agreement. However, we no longer intend to operate the pre-transaction business of the Company. In accordance with S-X Rule 8-03(b)(4), the following tables present the pro forma data that reflects revenue, income from continuing operations, net income, net income attributable to the registrant and income per share for the current interim period and the corresponding interim period of the preceding fiscal year as though the transaction occurred at the beginning of the periods. For the six months ended December 31, 2015 Life Clips Inc f/k/a Blue Sky Media Corp Klear Kapture, Inc Pro Forma Adjustment Pro Forma Combined Total Revenue $ - $ - $ - $ 0 Operating Loss $ - $ (201,591 ) $ - $ (201,591 ) Net Loss $ - $ (4,842,589 ) $ (77,888) A $ (4,920,477 ) Net income attributable to the registrant $ - $ (4,842,589 ) $ (77,888 ) $ (4,920,477 ) Earnings per share $ ** $ (0.10 ) $ - $ (0.10 ) ** Less than $0.01 For the six months ended Life Clips Inc f/k/a Blue Sky Pro Forma Combined December 31, 2014 Media Corp Klear Kapture, Inc. Adjustment Total Revenue $ - $ 22 $ - $ 22 Operating (Loss) $ - $ (9,550 ) $ (10,260) B $ (19,810 ) Net (Loss) $ - $ (9,550 ) $ (109,796) C $ (119,346 ) Net income attributable to the registrant $ - $ (9,550 ) $ (109,796 ) $ (119,346 ) Earnings per share $ ** $ ** $ - $ ** ** Less than $0.01 A Subsequently issue 3.85% interest Convertible Notes for $617,577.88 B Subsequently issued 3,190,000 shares of common stock, with a fair market value of $10,260, in exchange for consulting services. C In addition to item B, the Company subsequently issue 3.85% interest Convertible Notes for $617,577.88 |
Subsequent Events
Subsequent Events | 6 Months Ended |
Dec. 31, 2015 | |
Subsequent Events [Abstract] | |
Subsequent Events | NOTE 13. SUBSEQUENT EVENTS On February 4th, 2016 the Board of Directors and the Secretary of State of Delaware approved and accepted a Certificate of Ownership and Merger Merging Klear Kapture, Inc. into Life Clips, Inc. Prior to such merger, Klear Kapture, Inc. was a wholly owned subsidiary of the Company and the Board deemed it in the best interest of the Company to merge into the Company with the Company being the surviving entity. The Company has been developing new retail products aimed at the compact action camera market. The Company anticipates releasing the new product in March or April of 2016. These products are expected to be the Companys flagship products. Subsequently, the Companys working capital will be devoted to the manufacturing and introduction of these cameras and respective App software. The Company can make no assurances to the actual release date and commercial success of the products. |
Summary of Significant Accoun19
Summary of Significant Accounting Policies (Policies) | 6 Months Ended |
Dec. 31, 2015 | |
Accounting Policies [Abstract] | |
Use of Estimates | Use of estimates |
Cash and Cash Equivalents | Cash and cash equivalents |
Income Tax | Income Tax |
Basic and Diluted Net Income (Loss) Per Share | Basic and Diluted Net Income (Loss) Per Share |
Intangible Asset | Intangible Asset |
Fair Value of Financial Instruments | Fair Value of Financial Instruments The Company measures assets and liabilities at fair value based on an expected exit price as defined by the authoritative guidance on fair value measurements, which represents the amount that would be received on the sale of an asset or paid to transfer a liability, as the case may be, in an orderly transaction between market participants. As such, fair value may be based on assumptions that market participants would use in pricing an asset or liability. The authoritative guidance on fair value measurements establishes a consistent framework for measuring fair value on either a recurring or nonrecurring basis whereby inputs, used in valuation techniques, are assigned a hierarchical level. The following are the hierarchical levels of inputs to measure fair value: ● Level 1 Observable inputs that reflect quoted market prices in active markets for identical assets or liabilities. ● Level 2 Inputs reflect quoted prices for identical assets or liabilities in markets that are not active; quoted prices for similar assets or liabilities in active markets; inputs other than quoted prices that are observable for the assets or liabilities; or inputs that are derived principally from or corroborated by observable market data by correlation or other means. ● Level 3 Unobservable inputs reflecting the Companys assumptions incorporated in valuation techniques used to determine fair value. These assumptions are required to be consistent with market participant assumptions that are reasonably available. The carrying amounts of the Companys financial assets and liabilities, such as cash, prepaid expenses, other current assets, accounts payable & accrued expenses, certain notes payable and notes payable related party, approximate their fair values because of the short maturity of these instruments. The Company accounts for its derivative liabilities, at fair value, on a recurring basis under level 3. See Note 8. Embedded Conversion Features The Company evaluates embedded conversion features within convertible debt under ASC 815 Derivatives and Hedging to determine whether the embedded conversion feature(s) should be bifurcated from the host instrument and accounted for as a derivative at fair value with changes in fair value recorded in earnings. If the conversion feature does not require derivative treatment under ASC 815, the instrument is evaluated under ASC 470-20 Debt with Conversion and Other Options for consideration of any beneficial conversion feature. Derivative Financial Instruments The Company does not use derivative instruments to hedge exposures to cash flow, market, or foreign currency risks. The Company evaluates all of its financial instruments, including stock purchase warrants, to determine if such instruments are derivatives or contain features that qualify as embedded derivatives. For derivative financial instruments that are accounted for as liabilities, the derivative instrument is initially recorded at its fair value and is then re-valued at each reporting date, with changes in the fair value reported as charges or credits to income. For option-based simple derivative financial instruments, the Company uses the Black-Scholes option-pricing model to value the derivative instruments at inception and subsequent valuation dates. The classification of derivative instruments, including whether such instruments should be recorded as liabilities or as equity, is re-assessed at the end of each reporting period. Debt Issue Costs and Debt Discount The Company may record debt issue costs and/or debt discounts in connection with raising funds through the issuance of debt. These costs may be paid in the form of cash, or equity (such as warrants). These costs are amortized to interest expense over the life of the debt. If a conversion of the underlying debt occurs, a proportionate share of the unamortized amounts is immediately expensed. |
Stock Based Compensation | STOCK BASED COMPENSATION The Company recognizes stock-based compensation in accordance with ASC Topic 718 Stock Compensation, which requires the measurement and recognition of compensation expense for all share-based payment awards made to employees and directors including employee stock options and employee stock purchases related to an Employee Stock Purchase Plan based on the estimated fair values. For non-employee stock-based compensation, we have adopted ASC Topic 505 Equity-Based Payments to Non-Employees, which requires stock-based compensation related to non-employees to be accounted for based on the fair value of the related stock or options or the fair value of the services on the grant date, whichever is more readily determinable in accordance with ASC Topic 718. |
Common Stock | Common Stock |
Preferred Stock | Preferred Stock |
Recognition of Revenues | Recognition of Revenues |
Subsequent Events | Subsequent Events Pursuant to ASU 2010-09 of the FASB Accounting Standards Codification, the Company as an SEC filer considers its financial statements issued when they are widely distributed to users, such as through filing them on EDGAR. |
Recent Pronouncements | Recent Pronouncements In April 2015, the Financial Accounting Standards Board (FASB) issued Update 2015-03 Interest-Imputation of Interest (Subtopic 835-30):Simplifying the Presentation of Debt Issuance Costs. In December 2014, FASB issued Accounting Standards Update (ASU) No. 2014-18 Business Combinations (Topic 805): Accounting for Identifiable Intangible Assets in a Business Combination In January 2015, FASB issued Update No. 2015-01 Income StatementExtraordinary and Unusual Items (Subtopic 225-20): Simplifying Income Statement Presentation by Eliminating the Concept of Extraordinary Items. The Company reviewed all recent accounting pronouncements issued by the FASB (including its Emerging Issues Task Force), the AICPA, and the SEC and they did not or are not believed by management to have a material impact on the Companys present or future financial statements. |
Intangible Assets (Tables)
Intangible Assets (Tables) | 6 Months Ended |
Dec. 31, 2015 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Schedule of Intangible Assets | The Company is developing software. The development cost through December 31, 2015 has totaled $88,957. The software has an infinite useful life and will be tested annually for impairment. December 31, 2015 June 30, 2015 Software $ 88,957 $ 40,600 Less: Impairment Charges Less: Accumulated Amortization Patents - net $ 88,957 $ 40,600 |
Convertible Debt - Net (Tables)
Convertible Debt - Net (Tables) | 6 Months Ended |
Dec. 31, 2015 | |
Debt Disclosure [Abstract] | |
Schedule of Convertible Debt | The Company has recorded derivative liabilities associated with convertible debt instruments, as more fully discussed at Note 8. Third Party Balance June 30, 2015 $ - Proceeds 867,578 Repayments - Less: gross debt discount recorded (867,578 ) Add: Amortization of Debt Discount 84,359 Less Current portion - Long-Term Convertible Debt $ 84,358 |
Derivative Liabilities (Tables)
Derivative Liabilities (Tables) | 6 Months Ended |
Dec. 31, 2015 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
Schedule of Fair Value of Ratchet Feature Related to Convertible Debt and Warrants | As a result of the application of ASC No. 815, the fair value of the ratchet feature related to convertible debt and warrants is summarized as follow: December 31, 2015 June 30, 2015 Fair value at the commitment date - convertible debt $ 2,633,514 $ - Fair value mark to market adjustment - convertible debt 2,937,516 - Totals $ 5,571,030 $ - |
Schedule of Fair Value Assumption of Derivative Liabilities | The fair value at the commitment and re-measurement dates for the Companys derivative liabilities were based upon the following management assumptions as December 31, 2015: Commitment Date Re-measurement Date Expected dividends 0 % 0 % Expected volatility 220 % 259 % Expected term 2 years 1.65-1.92 years Risk free interest rate 0.58% - 0.94 % 1.06% - 1.06 % |
Debt Issue Cost (Tables)
Debt Issue Cost (Tables) | 6 Months Ended |
Dec. 31, 2015 | |
Debt Disclosure [Abstract] | |
Schedule of Debt Issue Cost | Balance- June 30, 2015 $ 46,129 Amortization (46,129 ) Balance- December 31, 2015 - |
Pro Forma Financial Data (Table
Pro Forma Financial Data (Tables) | 6 Months Ended |
Dec. 31, 2015 | |
Pro Forma Financial Data | |
Schedule of Pro Forma Financial Data | In accordance with S-X Rule 8-03(b)(4), the following tables present the pro forma data that reflects revenue, income from continuing operations, net income, net income attributable to the registrant and income per share for the current interim period and the corresponding interim period of the preceding fiscal year as though the transaction occurred at the beginning of the periods. For the six months ended December 31, 2015 Life Clips Inc f/k/a Blue Sky Media Corp Klear Kapture, Inc Pro Forma Adjustment Pro Forma Combined Total Revenue $ - $ - $ - $ 0 Operating Loss $ - $ (201,591 ) $ - $ (201,591 ) Net Loss $ - $ (4,842,589 ) $ (77,888) A $ (4,920,477 ) Net income attributable to the registrant $ - $ (4,842,589 ) $ (77,888 ) $ (4,920,477 ) Earnings per share $ ** $ (0.10 ) $ - $ (0.10 ) ** Less than $0.01 For the six months ended Life Clips Inc f/k/a Blue Sky Pro Forma Combined December 31, 2014 Media Corp Klear Kapture, Inc. Adjustment Total Revenue $ - $ 22 $ - $ 22 Operating (Loss) $ - $ (9,550 ) $ (10,260) B $ (19,810 ) Net (Loss) $ - $ (9,550 ) $ (109,796) C $ (119,346 ) Net income attributable to the registrant $ - $ (9,550 ) $ (109,796 ) $ (119,346 ) Earnings per share $ ** $ ** $ - $ ** ** Less than $0.01 A Subsequently issue 3.85% interest Convertible Notes for $617,577.88 B Subsequently issued 3,190,000 shares of common stock, with a fair market value of $10,260, in exchange for consulting services. C In addition to item B, the Company subsequently issue 3.85% interest Convertible Notes for $617,577.88 |
Organization and Operations (De
Organization and Operations (Details Narrative) - USD ($) | Oct. 02, 2015 | Dec. 31, 2015 |
Convertible note principal amount | $ 867,578 | |
Share Exchange Agreement [Member] | Klear Kapture, Inc [Member] | ||
Number of shares exchange for unregistered common stock | 380,037,120 | |
Number of common stock issued | 10,000 | |
Percentage of shares issued and outstanding | 100.00% | |
Number of common stock shares purchased during the period | 53,332,620 | |
Common stock purchase price per share | $ 0.0032 | |
Number of common stock purchased during the period | $ 345,000 | |
Share Exchange Agreement [Member] | Former Executive Officers And Directors [Member] | ||
Number of common stock shares purchased during the period | 107,261,000 | |
Number of common stock purchased during the period | $ 345,000 | |
Share Exchange Agreement [Member] | Three Accredited Investors [Member] | ||
Convertible note principal amount | $ 617,578 | |
Debt interest rate | 3.85% | |
Notes converted to shares of common stock | 26,426,620 |
Summary of Significant Accoun26
Summary of Significant Accounting Policies (Details Narrative) - USD ($) | Dec. 15, 2015 | Dec. 31, 2015 | Jun. 30, 2015 |
Accounting Policies [Abstract] | |||
Development cost | $ 88,957 | $ 40,600 | |
Common stock, shares authorized | 320,000,000 | 320,000,000 | 320,000,000 |
Common stock, par value | $ 0.001 | $ 0.001 | $ 0.001 |
Forward stock split description | 11:1 forward stock split | ||
Preferred stock, shares authorized | 20,000,000 | 20,000,000 | 20,000,000 |
Preferred stock, par value | $ 0.001 | $ 0.001 | $ 0.001 |
Uncertainty of Ability to Con27
Uncertainty of Ability to Continue as a Going Concern (Details Narrative) - USD ($) | Dec. 31, 2015 | Jun. 30, 2015 |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | ||
Accumulated Deficit | $ 5,744,480 | $ 700,300 |
Related Party Transactions (Det
Related Party Transactions (Details Narrative) - USD ($) | Dec. 31, 2015 | Jun. 30, 2015 |
Related Party Transactions [Abstract] | ||
Major shareholder owed | $ 2,713 |
Intangible Assets (Details Narr
Intangible Assets (Details Narrative) - USD ($) | Dec. 31, 2015 | Jun. 30, 2015 |
Goodwill and Intangible Assets Disclosure [Abstract] | ||
Developed Software | $ 88,957 | $ 40,600 |
Intangible Assets - Schedule of
Intangible Assets - Schedule of Intangible Assets (Details) - USD ($) | 6 Months Ended | 12 Months Ended | |
Dec. 31, 2015 | Jun. 30, 2014 | Jun. 30, 2015 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |||
Software | $ 88,957 | $ 40,600 | |
Less: Impairment Charges | |||
Less: Accumulated Amortization | |||
Patents - net | $ 88,957 | $ 40,600 |
Notes Payable (Details Narrativ
Notes Payable (Details Narrative) - USD ($) | 6 Months Ended | |
Dec. 31, 2015 | Jun. 30, 2015 | |
Debt Disclosure [Abstract] | ||
Notes payable | $ 50,500 | $ 85,500 |
Note maturity date | Jan. 5, 2016 |
Convertible Debt - Net (Details
Convertible Debt - Net (Details Narrative) - USD ($) | Dec. 07, 2015 | Oct. 02, 2015 | Dec. 31, 2015 | Dec. 31, 2014 | Oct. 02, 2014 |
Convertible note principal amount | $ 867,578 | ||||
Proceeds from convertible debt | $ 250,000 | $ 617,578 | $ 867,577 | ||
Debt maturity date | Jan. 5, 2016 | ||||
Outstanding convertible debt | $ 867,578 | ||||
3.85% Convertible Promissory Notes [Member] | |||||
Debt interest rate | 3.85% | ||||
Convertible note principal amount | $ 617,578 | ||||
principal and interest under Debt conversion price per share | $ 0.017 | ||||
Debt maturity date | Dec. 31, 2017 | ||||
3.85% Convertible Promissory Notes [Member] | Debt Instrument, Redemption, Period One [Member] | |||||
principal and interest under Debt conversion price per share | 0.017 | ||||
3.85% Convertible Promissory Notes [Member] | Debt Instrument, Redemption, Period Two [Member] | |||||
principal and interest under Debt conversion price per share | 0.026 | ||||
3.85% Convertible Promissory Notes [Member] | Debt Instrument, Redemption, Period Three [Member] | |||||
principal and interest under Debt conversion price per share | $ 0.15 | ||||
10% Convertible Promissory Notes [Member] | |||||
Debt interest rate | 10.00% | ||||
Convertible note principal amount | $ 250,000 | ||||
Note convertible into shares of common stock rate | 75.00% | ||||
Debt maturity date | Oct. 31, 2017 | ||||
Investor's Note [Member] | |||||
Debt instruments interest rate | 18.00% | ||||
Debt term | 24 months | ||||
3.85% Convertible Promissory Notes One [Member] | |||||
principal and interest under Debt conversion price per share | $ 0.026 |
Convertible Debt - Net - Schedu
Convertible Debt - Net - Schedule of Convertible Debt (Details) | 6 Months Ended |
Dec. 31, 2015USD ($) | |
Debt Disclosure [Abstract] | |
Balance June 30, 2015 | |
Proceeds | $ 867,578 |
Repayments | |
Less: gross debt discount recorded | $ (867,578) |
Add: Amortization of Debt Discount | $ 84,359 |
Less Current portion | |
Long-Term Convertible Debt | $ 84,358 |
Derivative Liabilities - Schedu
Derivative Liabilities - Schedule of Fair Value of Ratchet Feature Related to Convertible Debt and Warrants (Details) - USD ($) | Dec. 31, 2015 | Jun. 30, 2015 |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | ||
Fair value at the commitment date - convertible debt | $ 2,633,514 | |
Fair value mark to market adjustment - convertible debt | 2,937,516 | |
Totals | $ 5,571,030 |
Derivative Liabilities - Sche35
Derivative Liabilities - Schedule of Fair Value Assumption of Derivative Liabilities (Details) | 6 Months Ended |
Dec. 31, 2015 | |
Expected dividends | 0.00% |
Expected volatility | 220.00% |
Expected term | 2 years |
Re-measurement Date [Member] | |
Expected dividends | 0.00% |
Expected volatility | 259.00% |
Risk free interest rate | 1.06% |
Minimum [Member] | |
Risk free interest rate | 0.58% |
Minimum [Member] | Re-measurement Date [Member] | |
Expected term | 1 year 7 months 24 days |
Maximum [Member] | |
Risk free interest rate | 0.94% |
Maximum [Member] | Re-measurement Date [Member] | |
Expected term | 1 year 11 months 1 day |
Debt Discount (Details Narrativ
Debt Discount (Details Narrative) - USD ($) | 3 Months Ended | 6 Months Ended | |||
Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2015 | Dec. 31, 2014 | Jun. 30, 2015 | |
Debt Disclosure [Abstract] | |||||
Derivative expense | $ 4,703,452 | $ 4,703,452 | |||
Accumulated amortization of derivative discount | $ 84,359 | $ 84,359 | $ 0 |
Debt Issue Cost (Details Narrat
Debt Issue Cost (Details Narrative) - USD ($) | 3 Months Ended | 6 Months Ended | ||
Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2015 | Dec. 31, 2014 | |
Debt Disclosure [Abstract] | ||||
Amortization expense | $ 14,379 | $ 0 | $ 46,129 | $ 0 |
Debt Issue Cost - Schedule of D
Debt Issue Cost - Schedule of Debt Issue Cost (Details) - USD ($) | 3 Months Ended | 6 Months Ended | ||
Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2015 | Dec. 31, 2014 | |
Debt Disclosure [Abstract] | ||||
Balance - June 30, 2015 | $ 46,129 | |||
Amortization | $ (14,379) | $ 0 | $ (46,129) | $ 0 |
Balance - December 31, 2015 |
Common Stock (Details Narrative
Common Stock (Details Narrative) - USD ($) | Dec. 15, 2015 | Oct. 02, 2015 | Dec. 31, 2015 | Jun. 30, 2015 |
Common stock, shares authorized | 320,000,000 | 320,000,000 | 320,000,000 | |
Common stock, par value | $ 0.001 | $ 0.001 | $ 0.001 | |
Forward stock split description | 11:1 forward stock split | |||
Preferred stock, shares authorized | 20,000,000 | 20,000,000 | 20,000,000 | |
Preferred stock, par value | $ 0.001 | $ 0.001 | $ 0.001 | |
Consulting Agreement [Member] | Non Related Third Party [Member] | ||||
Number of common stock shares issued for services | 3,190,000 | |||
Shares issued price per share | $ 0.00318 | |||
Number of common stock issued for services | $ 10,150 | |||
Share Exchange Agreement [Member] | Klear Kapture, Inc [Member] | ||||
Shares issued price per share | $ 0.0032 | |||
Number of shares exchange for unregistered common stock | 380,037,120 | |||
Number of common stock issued | 10,000 | |||
Percentage of shares issued and outstanding | 100.00% | |||
Number of common stock shares purchased during the period | 53,332,620 | |||
Number of common stock purchased during the period | $ 345,000 | |||
Share Exchange Agreement [Member] | Former Executive Officers And Directors [Member] | ||||
Number of common stock shares purchased during the period | 107,261,000 | |||
Number of common stock purchased during the period | $ 345,000 | |||
Share Exchange Agreement [Member] | Robert Gruder [Member] | ||||
Percentage of shares issued and outstanding | 56.80% | |||
Number of common stock shares exchanged | 30,296,563 | |||
Number of common stock shares previously owned | 7,965 |
Pro Forma Financial Data - Sche
Pro Forma Financial Data - Schedule of Pro Forma Financial Data (Details) - USD ($) | 6 Months Ended | ||||
Dec. 31, 2015 | Dec. 31, 2014 | ||||
Revenue | $ 0 | $ 22 | |||
Operating Loss | (201,591) | (19,810) | |||
Net Loss | (4,920,477) | (119,346) | |||
Net income attributable to the registrant | $ (4,920,477) | $ (119,346) | |||
Earnings per share | $ (0.10) | [1] | |||
Pro Forma [Member] | |||||
Revenue | |||||
Operating Loss | $ (10,260) | [2] | |||
Net Loss | $ (77,888) | [3] | (109,796) | [4] | |
Net income attributable to the registrant | $ (77,888) | $ (109,796) | |||
Earnings per share | |||||
Klear Kapture, Inc [Member] | |||||
Revenue | $ 22 | ||||
Operating Loss | $ (201,591) | (9,550) | |||
Net Loss | (4,842,589) | (9,550) | |||
Net income attributable to the registrant | $ (4,842,589) | $ (9,550) | |||
Earnings per share | $ (0.10) | [1] | |||
Life Clips Inc f/k/a Blue Sky Media Corp [Member] | |||||
Revenue | |||||
Operating Loss | |||||
Net Loss | |||||
Net income attributable to the registrant | |||||
Earnings per share | [1] | ||||
[1] | Less than $0.01 | ||||
[2] | Subsequently issued 3,190,000 shares of common stock, with a fair market value of $10,260, in exchange for consulting services. | ||||
[3] | Subsequently issue 3.85% interest Convertible Notes for $617,577.88 | ||||
[4] | In addition to item B, the Company subsequently issue 3.85% interest Convertible Notes for $617,577.88 |
Pro Forma Financial Data - Sc41
Pro Forma Financial Data - Schedule of Pro Forma Financial Data (Details) (Parenthetical) - USD ($) | 6 Months Ended | |
Dec. 31, 2014 | Dec. 31, 2015 | |
Convertible note principal amount | $ 867,578 | |
Pro Forma [Member] | ||
Debt interest rate | 3.85% | 3.85% |
Convertible note principal amount | $ 617,578 | $ 617,578 |
Number of common stock shares issued for services | 3,190,000 | |
Number of common stock issued for services | $ 10,260 |