Document_and_Entity_Informatio
Document and Entity Information | 3 Months Ended | |
Mar. 31, 2015 | 19-May-15 | |
Document and Entity Information | ||
Entity Registrant Name | Earth Gen-Biofuel, Inc. | |
Entity Central Index Key | 1614924 | |
Document Type | 10-Q | |
Document Period End Date | 31-Mar-15 | |
Amendment Flag | FALSE | |
Current Fiscal Year End Date | -19 | |
Entity Current Reporting Status | No | |
Entity Filer Category | Smaller Reporting Company | |
Entity Common Stock, Shares Outstanding | 77,241,151 | |
Document Fiscal Year Focus | 2015 | |
Document Fiscal Period Focus | Q1 |
CONSOLIDATED_BALANCE_SHEETS
CONSOLIDATED BALANCE SHEETS (USD $) | Mar. 31, 2015 | Dec. 31, 2014 |
Current Assets | ||
Cash | $7,373 | $2,092 |
Prepaid expenses and other receivables | 1,514 | 1,514 |
Inventories, net | 474,428 | 486,994 |
Loan receivable | 1,100 | 1,100 |
Due from related party | 58,058 | 58,058 |
Total Current Assets | 542,473 | 549,758 |
Property and equipment, net | 18,743 | 19,705 |
Security deposit | 3,294 | 3,294 |
Total Assets | 564,510 | 572,757 |
Current Liabilities | ||
Accounts payable and accrued expenses | 85,328 | 87,340 |
Notes payable | 3,000 | |
Notes payable-related party | 7,000 | 7,000 |
Convertible notes, net | 47,737 | 31,361 |
Due to officer | 60,476 | 55,641 |
Total Current Liabilities | 200,541 | 184,342 |
Commitments and contingencies | ||
Stockholders' Equity | ||
Preferred stock, $0.0001 par value, 10,000,000 shares authorized, none issued and outstanding | ||
Common stock, $.0001 par value, 690,000,000 shares authorized, 75,794,151 and 75,080,817 shares issued and outstanding at March 31, 2015 and December 31, 2014 | 7,579 | 7,508 |
Additional paid-in capital | 2,545,815 | 2,440,387 |
Stock subscriptions payable | 28,000 | |
Accumulated deficit | -2,217,425 | -2,059,480 |
Total Stockholders' Equity | 363,969 | 388,415 |
Total Liabilities and Stockholders' Equity | $564,510 | $572,757 |
CONSOLIDATED_BALANCE_SHEETS_Pa
CONSOLIDATED BALANCE SHEETS (Parenthetical) (USD $) | Mar. 31, 2015 | Dec. 31, 2014 |
Statement of Financial Position [Abstract] | ||
Preferred stock, par value (in dollars per share) | $0.00 | $0.00 |
Preferred stock, shares authorized | 10,000,000 | 10,000,000 |
Preferred stock, shares issued | 0 | 0 |
Preferred stock, shares outstanding | 0 | 0 |
Common stock, par value (in dollars per share) | $0.00 | $0.00 |
Common stock, shares authorized | 690,000,000 | 690,000,000 |
Common stock, shares issued | 75,794,151 | 75,080,817 |
Common stock, shares outstanding | 75,794,151 | 75,080,817 |
CONSOLIDATED_STATEMENTS_OF_OPE
CONSOLIDATED STATEMENTS OF OPERATIONS (USD $) | 3 Months Ended | |
Mar. 31, 2015 | Mar. 31, 2014 | |
Income Statement [Abstract] | ||
Revenues | ||
Operating expenses: | ||
General and administrative | 110,016 | 324,022 |
Inventory reserve | 30,566 | |
Total operating expenses | 140,582 | 324,022 |
Other Income (Expense) | ||
Interest expense | -17,363 | |
Total other (Expense) | -17,363 | |
Loss before income taxes | -140,582 | -324,022 |
Provision for income taxes | ||
Net loss | ($157,945) | ($324,022) |
Net loss per common share | ||
Basic and diluted | $0 | $0 |
Weighted average common shares outstanding | ||
Basic and diluted | 75,149,498 | 84,431,128 |
CONSOLIDATED_STATEMENTS_OF_CAS
CONSOLIDATED STATEMENTS OF CASH FLOWS (USD $) | 3 Months Ended | |
Mar. 31, 2015 | Mar. 31, 2014 | |
Operating Activities: | ||
Net loss | ($157,945) | ($324,022) |
Adjustments to reconcile net loss to net cash used by operating activities: | ||
Depreciation expense | 962 | 314 |
Amortization of BCF debt discounts | 16,376 | |
Inventory reserve | 30,566 | |
Stock-based compensation | 66,590 | |
Changes in operating assets and liabilities: | ||
Inventory | -18,000 | -17,340 |
Prepaid expenses and other receivables | -3,965 | |
Related party payables | 4,835 | -25,274 |
Accounts payable and accrued expenses | -2,013 | -13,280 |
Net cash used by operating activities | -125,219 | -316,977 |
Financing Activities: | ||
Proceeds from stock issuances | 105,500 | 621,130 |
Proceeds from stock and warrant issuances | 50,500 | |
Cash received for stock subscriptions payable | 28,000 | |
Net cash provided by financing activities | 130,500 | 671,630 |
Net increase in cash | 5,281 | 354,653 |
Cash, beginning of period | 2,092 | 154,178 |
Cash, end of period | 7,373 | 508,831 |
Cash paid during the period | ||
Interest | ||
Income taxes |
Nature_of_Operations_and_Basis
Nature of Operations and Basis of Presentation | 3 Months Ended |
Mar. 31, 2015 | |
Nature Of Operations And Basis Of Presentation | |
Nature of Operations and Basis of Presentation | Note 1—Nature of Operations and Basis of Presentation |
Earth Gen-Biofuel, Inc. (the “Company” or “Earth Gen”) was incorporated in the state of Nevada on August 28, 2012 to pursue the business of becoming an international agricultural company focused on growing plants that are the basis for providing renewable sources for manufacturing processes and energy. | |
On September 25, 2012, Earth Gen entered into an Agreement of Share Exchange and Plan of Reorganization (the “Exchange Agreement”) with EarthBlock Technologies, Inc. (“EarthBlock”), a Nevada publicly traded corporation, pursuant to which EarthBlock acquired 100% of the ownership of the Company in exchange for 63,666,400 shares of EarthBlock’s common stock (the “Exchange”) on the basis of four shares of EarthBlock for one share of Earth Gen outstanding as of October 14, 2012. | |
Upon the completion of the Exchange, Earth Gen operated as a wholly owned subsidiary of EarthBlock and focused its efforts to begin its international agricultural operations. In October of 2012, Earth Gen began to organize farmers and government related agencies in Laos and Vietnam to control land for growing castor beans. Prior to Earth Gen becoming a subsidiary of EarthBlock, Earth Gen’s management had spent over two years creating the relationships and working with local farmers to build an organization and obtain the knowledge and expertise to become a major grower of castor beans in these countries. | |
The common stock of EarthBlock was registered with the SEC under the Exchange Act and was quoted on OTCQB operated by the OTC Markets Group Inc. EarthBlock failed to comply with Exchange Act Section 13(a) because it had not filed any periodic reports with the SEC since the period ended December 31, 2007. EarthBlock consented to a deregistration order of the SEC, and pursuant to Section 12(j) of the Exchange Act, registration of EarthBlock’s common stock was revoked and trading in EarthBlock’s common stock was suspended. | |
Additionally, the shareholders of Earth Gen were not made aware of the full extent of a material liability of EarthBlock that resulted from the operations of EarthBlock’s non-operational subsidiary EarthBlock Texas Homes, Inc. As a result of the liability not being included in proper detail and information regarding its effect on EarthBlock’s financial statements, EarthBlock’s previously disclosed financial condition was inaccurate. | |
On September 25, 2013, the Board of Directors of EarthBlock and of Earth Gen voted to rescind the acquisition of Earth Gen by EarthBlock and authorized the officers of the Corporation to take the steps required to complete the rescission of the Exchange. | |
A rescission agreement dated October 28, 2013 (the “Rescission Agreement”) was entered into by and among EarthBlock, Earth Gen and the shareholders. A majority of Earth Gen shareholders approved the Rescission Agreement on October 28, 2013. The Rescission Agreement sets forth the terms and provisions where the parties agreed to take all steps necessary and proper to unwind the Exchange including the surrender of the Exchange Shares for cancellation and Earth Gen to issue to each Exchange Share shareholder his respective original equity interests in Earth Gen. The Additional Shares will remain outstanding and will ratably dilute the Exchange Share shareholders pre-Exchange, original equity ownership in Earth Gen as a result. | |
The Rescission Agreement offer terminated on October 10, 2014. Pursuant to the terms of the Rescission Agreement, Earth Gen issued a total of 50,645,600 Earth Gen common stock shares to participating holders of Exchange Shares commensurate with the holders’ respective original equity interests in Earth Gen. Earth Gen also issued a total of 7,030,400 Additional Shares. No additional Earth Gen common stock shares will be issued as a result of the rescission of the Reverse Merger. One Shareholder owning 7,560,000 Exchange Shares did not become a party to the Rescission Agreement and will retain his EarthBlock common stock shares and with no equity interest in Earth Gen. | |
In March 2014, Earth Gen-Biofuel Lao Sole Co Ltd (“Earth Gen Laos”) was formed under the laws of Laos to meet Laos’s regulatory and legal requirements to do business in Laos. This company is 100% controlled by Earth Gen. Earth Gen Laos has its own in-country bank accounts denominated in US dollars through which it pays all local operating expenses of the business activities of Earth Gen in Laos. |
Going_Concern
Going Concern | 3 Months Ended |
Mar. 31, 2015 | |
Going Concern [Abstract] | |
Going Concern | Note 2—Going Concern |
These financial statements have been prepared on a going concern basis, which implies that the Company will continue to realize its assets and discharge its liabilities in the normal course of business. As of March 31, 2015, the Company has an accumulated deficit since inception. The continuation of the Company as a going concern is dependent upon the continued financial support from its management, and its ability to identify future investment opportunities and obtain the necessary debt or equity financing, and generating profitable operations from the Company’s future operations. These factors raise substantial doubt regarding the Company’s ability to continue as a going concern. These financial statements do not include any adjustments to the recoverability and classification of recorded asset amounts and classification of liabilities that might be necessary should the Company be unable to continue as a going concern. |
Significant_Accounting_Policie
Significant Accounting Policies | 3 Months Ended |
Mar. 31, 2015 | |
Accounting Policies [Abstract] | |
Significant Accounting Policies | Note 3—Significant Accounting Policies |
Use of Estimates | |
The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities at the date of the financial statements and the reported amounts of revenue and expenses during the reporting period. Actual results could differ from those estimates. | |
Principles of Consolidation | |
The consolidated financial statements include the accounts of the Company and its subsidiary. All inter-company accounts and transactions have been eliminated in consolidation. | |
Unaudited Interim Financial Information | |
These unaudited interim financial statements have been prepared in accordance with GAAP for interim financial reporting and the rules and regulations of the Securities and Exchange Commission that permit reduced disclosure for interim periods. Therefore, certain information and footnote disclosures normally included in financial statements prepared in accordance with GAAP have been condensed or omitted. In the opinion of management, all adjustments of a normal recurring nature necessary for a fair presentation of the financial position, results of operations and cash flows for the periods presented have been made. The results of operations for the interim periods presented are not necessarily indicative of the results to be expected for the year ending December 31, 2015. | |
The balance sheets and certain comparative information as of December 31, 2014 are derived from the audited financial statements and related notes for the year ended December 31, 2014 (“2014 Annual Financial Statements”), included in the Company’s 2014 Annual Report on Form 10-K. These unaudited interim financial statements should be read in conjunction with the 2014 Annual Financial Statements. | |
Basic and Diluted Loss per Common Share | |
Basic loss per share is calculated by dividing the Company’s net loss applicable to common shareholders by the weighted average number of common shares during the period. Diluted loss per share is calculated by dividing the Company’s net loss available to common shareholders by the diluted weighted average number of shares outstanding during the period. The diluted weighted average number of shares outstanding is the basic weighted number of shares adjusted for any potentially dilutive debt or equity. Diluted loss per share excludes all dilutive potential shares if their effect is anti-dilutive. | |
The Company has issued common stock purchase warrants and entered into convertible note; however, they are anti-dilutive given the net loss incurred for the periods presented. As a result, 6,555,952 potentially dilutive common stock equivalents (presented post-dividend and post-split) were excluded from the calculation of diluted loss per common share as of March 31, 2015. Therefore, dilutive and basic losses per common share are equal. | |
Inventory | |
Inventory consists of raw materials consisting of castor bean seeds. Inventories are recorded at the lower of cost or market, using the first-in, first-out method. Cost is determined at the actual cost for raw materials. | |
Expenditures on growing crops are valued at the lower of cost or market and are deferred and charged to cost of sales when the related crops are harvested and sold. The deferred growing costs included in inventories in the balance sheets consist primarily of land rental cost and service costs. | |
In assessing the ultimate realization of inventories, the management makes judgments as to future demand requirements compared to current or committed inventory levels. The Company’s reserve requirements generally increase or decrease with its projected demand requirements and market conditions. The Company estimates the demand requirements based on market conditions, forecasts prepared by its customers, sales contracts and orders in hand. | |
In addition, the Company estimates net realizable value based on intended use, current market value and inventory ageing analyses. The Company writes down the inventories for estimated obsolescence or unmarketable inventory equal to the difference between the cost of inventories and the estimated market value based upon assumptions about future demand and market conditions. | |
Based on the above assessment, the Company recorded an inventory reserve of $30,566 and $64,320 as of March 31, 2015 and December 31, 2014, respectively. | |
Revenue Recognition | |
Revenue from sales of the Company’s products is recognized upon customer acceptance, which occurs at the time of delivery to the customer, provided persuasive evidence of an arrangement exists, such as signed sales contract, the significant risks and rewards of ownership have been transferred to the buyer at the time when the products are delivered to its customers with no significant post-delivery obligation on our part, the sales price is fixed or determinable and collection is reasonably assured. The Company does not provide its customers with contractual rights of return and post-delivery discount for any of its products. When there is any significant post-delivery performance obligations exists, revenue is recognized only after such obligations are fulfilled. The Company evaluates the terms of sales agreement with its customers in order to determine whether any significant post-delivery performance obligations exist. | |
New Accounting Pronouncements | |
Accounting Standards Update No. 2014-10, Development Stage Entities (Topic 915): Elimination of Certain Financial Reporting Requirements, Including an Amendment to Variable Interest Entities Guidance in Topic 810, Consolidation removes all incremental financial reporting requirements from GAAP for development stage entities, including the removal of Topic 915 from the FASB Accounting Standards Codification. For organizations defined as public business entities, for the first annual period beginning after December 15, 2014, the presentation and disclosure requirements in Topic 915 will no longer be required. The revised consolidation standards are effective one year later, in annual periods beginning after December 15, 2015. Early adoption is permitted. For other organizations, for the first annual period beginning after December 15, 2014, the presentation and disclosure requirements in Topic 915 will no longer be required. The revised consolidation standards are effective two years later, in annual periods beginning after December 15, 2016. Early adoption is permitted. The adoption of this pronouncement will not have a material impact on the Company’s financial statements. | |
In August 2014, the FASB issued ASU No. 2014-15, Presentation of Financial Statements - Going Concern (Subtopic 205-40) - Disclosure of Uncertainties about an Entity’s Ability to Continue as a Going Concern, which provides guidance regarding management’s responsibility to assess whether substantial doubt exists regarding the ability to continue as a going concern and to provide related footnote disclosures. In connection with preparing financial statements for each annual and interim reporting period, an entity’s management should evaluate whether there are conditions or events, considered in the aggregate, that raise substantial doubt about the entity’s ability to continue as a going concern within one year after the date that the financial statements are issued (or within one year after the date that the financial statements are available to be issued when applicable). This ASU is effective for the annual period ending after December 15, 2016, and for annual periods and interim periods thereafter. We are currently evaluating the new guidance and have not determined the impact this standard may have on our condensed financial statements. | |
We do not believe there are any other recently issued standards not yet effective that will have a material impact on our financial statements when the standards become effective. |
Inventory
Inventory | 3 Months Ended | ||||
Mar. 31, 2015 | |||||
Inventory Disclosure [Abstract] | |||||
Inventory | Note 4—Inventory | ||||
Inventory consists of: | |||||
March 31, | December 31, | ||||
2015 | 2014 | ||||
Seeds | $ - | $ - | |||
Capitalized costs of growing crops | 569,314 | 551,314 | |||
Total inventory | $ 569,314 | $ 551,314 | |||
Less: inventory reserve | -94,886 | -64,320 | |||
Inventory, net | $ 474,428 | $ 486,994 |
Property_and_Equipment
Property and Equipment | 3 Months Ended | ||||
Mar. 31, 2015 | |||||
Property, Plant and Equipment [Abstract] | |||||
Property and Equipment | Note 5— Property and Equipment | ||||
Property and equipment consist of: | |||||
March 31, | December 31, | ||||
2014 | 2014 | ||||
Machinery and equipment | $ 11,240 | $ 11,240 | |||
Automobile | 7,000 | 7,000 | |||
Office equipment | 4,216 | 4,216 | |||
Total | 22,456 | 22,456 | |||
Less: accumulated depreciation | (3,713) | (2,751) | |||
Property and equipment, net | $ 18,743 | $ 19,705 | |||
For the three months ended March 31, 2015 and 2014, depreciation expenses were $962 and $314, respectively. |
Due_from_Related_Parties
Due from Related Parties | 3 Months Ended |
Mar. 31, 2015 | |
Related Party Transactions [Abstract] | |
Due from Related Parties | Note 6— Due from Related Parties |
The Company and EarthBlock advance each other monies in the normal course of business. During the period ended December 31, 2014 and December 31, 2013, net funds provided to EarthBlock were $58,058 and $56,958, respectively. The advances do not have written note, do not accrued interest and are due on demand. | |
As of March 31, 2015 and December 31, 2014, the Company owed $60,476 and $55,641 to George Shen, CEO and shareholder of the Company for accrued service fees and monies advanced to and repaid by the Company in the normal course of business. The advances do not have written note, do not accrue interest and are due on demand. | |
Prior to September 30, 2013, the Company was provided office space at no charge by George Shen Starting July 1, 2013, the Company has been paying office rent at $3,360 under a month-to-month lease agreement. | |
The Company obtained a promissory note of $2,000 from a company in which George Shen is also an officer. The promissory note bears interest at 2% per annum and due July 30, 2015. | |
The Company obtained a promissory note of $5,000 from one of its shareholders. The promissory note bears no interest and was due July 30, 2013. The shareholder has not demanded repayment. |
Notes_Payable
Notes Payable | 3 Months Ended | |||
Mar. 31, 2015 | ||||
Notes Payable [Abstract] | ||||
Notes Payable | Note 7— Notes Payable | |||
The Company obtained short-term loans from an unrelated party for working capital purposes. | ||||
Note payable consists of: | ||||
March 31, | 31-Dec-14 | |||
2014 | ||||
Promissory notes due unrelated party, interest at 2% per annum, default interest at additional 5%, due July 30, 2015 | $ - | $ 3,000 | ||
Total | $ - | $ 3,000 | ||
The note was paid off in February 2015. |
Convertible_Note
Convertible Note | 3 Months Ended |
Mar. 31, 2015 | |
Notes Payable, Current [Abstract] | |
Convertible Note | Note 8— Convertible Note |
On December 15, 2014, the Company issued a $7,000 convertible note. The convertible note bears interest at 2% per annum, due July 30, 2015, convertible into common stock of the Company anytime after June 20, 2015 at a conversion price of $0.07 per share. If the outstanding balance of the convertible note is not paid when due, the default interest is 5% per annum above the rate that would otherwise be in effect with the default interest accruing, from and including such due date, on a cumulative, compounding basis. | |
On October 29, 2014, the Company issued a $36,000 convertible note. The convertible note bears interest at 5% per annum, due December 15, 2015, convertible into common stock of the Company anytime after May 15, 2015 at a conversion price of $0.07 per share. If the outstanding balance of the convertible note is not paid when due, the default interest is 2% per annum above the rate that would otherwise be in effect with the default interest accruing, from and including such due date, on a cumulative, compounding basis. | |
On September 30, 2014, the Company issued a $40,000 convertible note. The convertible note bears interest at 5% per annum, due September 15, 2015, convertible into common stock of the Company anytime after January 30, 2015 at a conversion price of $0.10 per share. If the outstanding balance of the convertible note is not paid when due, the default interest is 2% per annum above the rate that would otherwise be in effect with the default interest accruing, from and including such due date, on a cumulative, compounding basis. | |
The Company calculated $63,000 for the intrinsic value of the beneficial conversion feature (“BCF”) of the convertible notes (based on the last sale price of $0.15 per share) and recorded the $63,000 BCF as a debt discount and as an addition to additional paid-in capital on effective date of the notes. The debt discount is being amortized to interest expense over the term of the note. For the three months ended March 31, 2015, $16,376 of BCF debt discount was amortized to interest expense. |
Stockholders_Equity
Stockholders' Equity | 3 Months Ended | ||||||
Mar. 31, 2015 | |||||||
Equity [Abstract] | |||||||
Stockholders' Equity | Note 9—Stockholders’ Equity | ||||||
At March 31, 2015, the Company is authorized to issue 690,000,000 shares of $0.0001 par value common stock and 10,000,000 of $0.0001 par value preferred stock. | |||||||
In anticipation of the rescission of the exchange agreement with EarthBlock and to prevent dilution to existing shareholders of the Company, on October 15, 2013, the board of directors of the Company approved a stock dividend of three shares for each outstanding share. The stock dividend is being treated as a stock split due to its high volume. All share and per share information has been retroactively adjusted to reflect the stock split. | |||||||
On March 27, 2014, the Company’s shareholders approved a recapitalization of the capital stock in the form of reverse stock split of its common stock in a ratio of 1-for-25. The shareholders also approved an amendment to the Articles of Incorporation to reduce the number of authorized shares of stock to 700,000,000 from 3,000,000,000. Of the 700,000,000 authorized shares, there are 10,000,000 shares of preferred stock and 690,000,000 shares of common stock. | |||||||
As of March 31, 2015, 75,794,151 shares were issued and outstanding. As a result of above stock split and reverse split, at December 31, 2014, 75,080,817 shares were issued and outstanding after adjusted for the stock split and reverse split. | |||||||
Private Placements of Common Stock | |||||||
From January 1 to March 31, 2015, Earth Gen issued to investors 713,334 shares of its common stock at the offering price of $0.075 to $0.15 per share for an aggregate amount of $105,500. For the three-month period ended March 31, 2015, the Company received $28,000 for subscriptions payable to issue 253,167 shares of common stock. No commissions were paid. There was no agreement to register shares offered in this private placement. | |||||||
Restricted Stock Awards (“RSA”) Issued for Services | |||||||
All reference to numbers of shares issued for warrants and per share price is based on a post-stock-dividend and post-reverse-split amount. During three months ended March 31, 2015 and year ended December 31, 2014, the Company granted 0 and 3,299,267 RSAs to various consultants for their services provided to the Company. | |||||||
As of March 31, 2015 and December 31, 2014, all RSAs are vested and there was no unrecognized compensation cost related to RSAs. | |||||||
For the three months ended March 31, 2015 and 2014, stock-based compensation expense was $0 and $66,590, respectively. The value of the shares issued was based on the fair value of the stock issued, which was based on the most recent sale of common stock for cash. | |||||||
Warrants | |||||||
In connection with the 2013 private placements, the Company issued warrants for 6,400,000 shares of Earth Gen Common Stock on August 1, 2013 and 1,600,000 warrants on September 12, 2013. Each of these warrants entitled the holder to purchase one (1) share of Earth Gen common stock at $0.03 per share starting on January 1, 2014 and ending on December 15, 2016. As of March 31, 2015, 1,000,000 warrants have been exercised in exchange for total cash proceeds of $31,250 or $0.03 per share. | |||||||
In connection with the January 2014 private placement, the Company issued warrants to purchase 202,000 shares of Earth Gen common stock on March 20, 2014. Each warrant entitles the holder to purchase one (1) share of Earth Gen common stock at $0.50 per share starting on July 15, 2014 and ending on September 30, 2016. | |||||||
These warrants have standard anti-dilution language to allow for recapitalizations and distributions. The warrants are equity classified and amounts attributable to the warrants are classified within additional paid-in capital. All reference to numbers of shares issued for warrants and per share price is based on a post-stock-dividend and post-reverse-split amount. | |||||||
A summary of the status of the Company’s warrants outstanding as of March 31, 2015 is presented below: | |||||||
Number of | |||||||
Shares | |||||||
Outstanding at December 31, 2014 | 7,202,000 | ||||||
Outstanding at March 31, 2015 | 7,202,000 | ||||||
Exercisable at March 31, 2015 | 7,202,000 | ||||||
The following table summarizes information about warrants outstanding as of March 31, 2015: | |||||||
Options and Warrants | Options and Warrants | ||||||
Outstanding | Exercisable | ||||||
Exercise Prices | Number Outstanding | Weighted Average Remaining Contractual Life | Weighted | Number Exercisable | Weighted Average Exercise Price | ||
(in years) | Average | ||||||
Exercise | |||||||
Price | |||||||
$0.03 | 7,000,000 | 1.71 | $0.03 | 7,000,000 | $0.03 | ||
$0.50 | 202,000 | 1.5 | $0.50 | 202,000 | $0.50 | ||
7,202,000 | 1.71 | $0.04 | 7,202,000 | $0.04 | |||
Commitments_and_Contingencies
Commitments and Contingencies | 3 Months Ended |
Mar. 31, 2015 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | Note 10—Commitments and Contingencies |
Farm Lease Agreements | |
On March 10, 2014, Earth Gen entered into a lease agreement for 136 hectares of farm land located at Phoengam Neua Village, Pek Districk, Xiengkhuang Province in the People’s Republic of Lao. The term of the lease is for twelve years with an option for Earth Gen to renew for an additional twelve years. Earth Gen is obligated to pay taxes on the land of up to $1,000 per year any taxes in excess of that amount are the obligation of the landowner. In addition, Earth Gen is obligated to provide all elements required to grow castor beans on the land and start using the land in partial or in full for castor bean farming operations before the end of 2014. The compensation to the landowner under the agreement is $50.00 per metric ton of castor beans harvested and is due ninety days after the harvest. | |
In addition to this agreement, Earth Gen has entered into two additional agreements, under the terms substantially equivalent to the original agreement described above, for 103 additional hectares in Xiengkhuang Province in close proximity to the Phoengram Neua Village farm. |
Subsequent_Events
Subsequent Events | 3 Months Ended |
Mar. 31, 2015 | |
Subsequent Events [Abstract] | |
Subsequent Events | Note 11 – Subsequent Events |
April 1, 2015 through May 8, 2015 Private Placement of Common Stock | |
The company received $101,500 for the purchase of common stock during the period from April 1, 2015 to May 18, 2015. There were 1,450,000 shares issued at a price of $0.07 per share. | |
The securities described above were issued to investors in reliance upon the exemption from registration requirements of the Securities Act, as set forth in Section 4(2) under the Securities Act and Regulation D promulgated thereunder relating to transactions by an issuer not involving any public offering. No commissions were paid and no agreements to register shares were offered in the private placements. All Purchasers of shares described above represented to us in connection with their purchase that they were accredited investors and were acquiring the shares for their own account for investment purposes only and not with a view to, or for sale in connection with, any distribution thereof. The purchasers received written disclosures that the securities had not been registered under the Securities Act and that any resale must be made pursuant to a registration statement or an available exemption from such registration. |
Reclassification
Reclassification | 3 Months Ended |
Mar. 31, 2015 | |
Reclassification | |
Reclassification | Note 12 – Reclassification |
Certain balances in previously issued financial statements have been reclassified to be consistent with the current period presentation. |
Significant_Accounting_Policie1
Significant Accounting Policies (Policies) | 3 Months Ended |
Mar. 31, 2015 | |
Accounting Policies [Abstract] | |
Use of Estimates | Use of Estimates |
The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities at the date of the financial statements and the reported amounts of revenue and expenses during the reporting period. Actual results could differ from those estimates. | |
Principles of Consolidation | Principles of Consolidation |
The consolidated financial statements include the accounts of the Company and its subsidiary. All inter-company accounts and transactions have been eliminated in consolidation. | |
Unaudited Interim Financial Information | Unaudited Interim Financial Information |
These unaudited interim financial statements have been prepared in accordance with GAAP for interim financial reporting and the rules and regulations of the Securities and Exchange Commission that permit reduced disclosure for interim periods. Therefore, certain information and footnote disclosures normally included in financial statements prepared in accordance with GAAP have been condensed or omitted. In the opinion of management, all adjustments of a normal recurring nature necessary for a fair presentation of the financial position, results of operations and cash flows for the periods presented have been made. The results of operations for the interim periods presented are not necessarily indicative of the results to be expected for the year ending December 31, 2015. | |
The balance sheets and certain comparative information as of December 31, 2014 are derived from the audited financial statements and related notes for the year ended December 31, 2014 (“2014 Annual Financial Statements”), included in the Company’s 2014 Annual Report on Form 10-K. These unaudited interim financial statements should be read in conjunction with the 2014 Annual Financial Statements. | |
Basic and Diluted Loss per Common Share | Basic and Diluted Loss per Common Share |
Basic loss per share is calculated by dividing the Company’s net loss applicable to common shareholders by the weighted average number of common shares during the period. Diluted loss per share is calculated by dividing the Company’s net loss available to common shareholders by the diluted weighted average number of shares outstanding during the period. The diluted weighted average number of shares outstanding is the basic weighted number of shares adjusted for any potentially dilutive debt or equity. Diluted loss per share excludes all dilutive potential shares if their effect is anti-dilutive. | |
The Company has issued common stock purchase warrants and entered into convertible note; however, they are anti-dilutive given the net loss incurred for the periods presented. As a result, 6,555,952 potentially dilutive common stock equivalents (presented post-dividend and post-split) were excluded from the calculation of diluted loss per common share as of March 31, 2015. Therefore, dilutive and basic losses per common share are equal. | |
Inventory | Inventory |
Inventory consists of raw materials consisting of castor bean seeds. Inventories are recorded at the lower of cost or market, using the first-in, first-out method. Cost is determined at the actual cost for raw materials. | |
Expenditures on growing crops are valued at the lower of cost or market and are deferred and charged to cost of sales when the related crops are harvested and sold. The deferred growing costs included in inventories in the balance sheets consist primarily of land rental cost and service costs. | |
In assessing the ultimate realization of inventories, the management makes judgments as to future demand requirements compared to current or committed inventory levels. The Company’s reserve requirements generally increase or decrease with its projected demand requirements and market conditions. The Company estimates the demand requirements based on market conditions, forecasts prepared by its customers, sales contracts and orders in hand. | |
In addition, the Company estimates net realizable value based on intended use, current market value and inventory ageing analyses. The Company writes down the inventories for estimated obsolescence or unmarketable inventory equal to the difference between the cost of inventories and the estimated market value based upon assumptions about future demand and market conditions. | |
Based on the above assessment, the Company recorded an inventory reserve of $30,566 and $64,320 as of March 31, 2015 and December 31, 2014, respectively. | |
Revenue Recognition | Revenue Recognition |
Revenue from sales of the Company’s products is recognized upon customer acceptance, which occurs at the time of delivery to the customer, provided persuasive evidence of an arrangement exists, such as signed sales contract, the significant risks and rewards of ownership have been transferred to the buyer at the time when the products are delivered to its customers with no significant post-delivery obligation on our part, the sales price is fixed or determinable and collection is reasonably assured. The Company does not provide its customers with contractual rights of return and post-delivery discount for any of its products. When there is any significant post-delivery performance obligations exists, revenue is recognized only after such obligations are fulfilled. The Company evaluates the terms of sales agreement with its customers in order to determine whether any significant post-delivery performance obligations exist. | |
New Accounting Pronouncements | New Accounting Pronouncements |
Accounting Standards Update No. 2014-10, Development Stage Entities (Topic 915): Elimination of Certain Financial Reporting Requirements, Including an Amendment to Variable Interest Entities Guidance in Topic 810, Consolidation removes all incremental financial reporting requirements from GAAP for development stage entities, including the removal of Topic 915 from the FASB Accounting Standards Codification. For organizations defined as public business entities, for the first annual period beginning after December 15, 2014, the presentation and disclosure requirements in Topic 915 will no longer be required. The revised consolidation standards are effective one year later, in annual periods beginning after December 15, 2015. Early adoption is permitted. For other organizations, for the first annual period beginning after December 15, 2014, the presentation and disclosure requirements in Topic 915 will no longer be required. The revised consolidation standards are effective two years later, in annual periods beginning after December 15, 2016. Early adoption is permitted. The adoption of this pronouncement will not have a material impact on the Company’s financial statements. | |
In August 2014, the FASB issued ASU No. 2014-15, Presentation of Financial Statements - Going Concern (Subtopic 205-40) - Disclosure of Uncertainties about an Entity’s Ability to Continue as a Going Concern, which provides guidance regarding management’s responsibility to assess whether substantial doubt exists regarding the ability to continue as a going concern and to provide related footnote disclosures. In connection with preparing financial statements for each annual and interim reporting period, an entity’s management should evaluate whether there are conditions or events, considered in the aggregate, that raise substantial doubt about the entity’s ability to continue as a going concern within one year after the date that the financial statements are issued (or within one year after the date that the financial statements are available to be issued when applicable). This ASU is effective for the annual period ending after December 15, 2016, and for annual periods and interim periods thereafter. We are currently evaluating the new guidance and have not determined the impact this standard may have on our condensed financial statements. | |
We do not believe there are any other recently issued standards not yet effective that will have a material impact on our financial statements when the standards become effective. |
Inventory_Tables
Inventory (Tables) | 3 Months Ended | ||||
Mar. 31, 2015 | |||||
Inventory Disclosure [Abstract] | |||||
Schedule of inventory | March 31, | December 31, | |||
2015 | 2014 | ||||
Seeds | $ - | $ - | |||
Capitalized costs of growing crops | 569,314 | 551,314 | |||
Total inventory | $ 569,314 | $ 551,314 | |||
Less: inventory reserve | -94,886 | -64,320 | |||
Inventory, net | $ 474,428 | $ 486,994 |
Property_and_Equipment_Tables
Property and Equipment (Tables) | 3 Months Ended | ||||
Mar. 31, 2015 | |||||
Property And Equipment Tables | |||||
Schedule of Property and equipment | March 31, | December 31, | |||
2014 | 2014 | ||||
Machinery and equipment | $ 11,240 | $ 11,240 | |||
Automobile | 7,000 | 7,000 | |||
Office equipment | 4,216 | 4,216 | |||
Total | 22,456 | 22,456 | |||
Less: accumulated depreciation | (3,713) | (2,751) | |||
Property and equipment, net | $ 18,743 | $ 19,705 |
Notes_Payable_Tables
Notes Payable (Tables) | 3 Months Ended | |||
Mar. 31, 2015 | ||||
Notes Payable Tables | ||||
Schedule of Note payable | March 31, | 31-Dec-14 | ||
2014 | ||||
Promissory notes due unrelated party, interest at 2% per annum, default interest at additional 5%, due July 30, 2015 | $ - | $ 3,000 | ||
Total | $ - | $ 3,000 |
Stockholders_Equity_Tables
Stockholders' Equity (Tables) | 3 Months Ended | ||||||
Mar. 31, 2015 | |||||||
Equity [Abstract] | |||||||
Summary of the status of the Company's warrants outstanding | Number of | ||||||
Shares | |||||||
Outstanding at December 31, 2014 | 7,202,000 | ||||||
Outstanding at March 31, 2015 | 7,202,000 | ||||||
Exercisable at March 31, 2015 | 7,202,000 | ||||||
Summary of information about warrants outstanding | Options and Warrants | Options and Warrants | |||||
Outstanding | Exercisable | ||||||
Exercise Prices | Number Outstanding | Weighted Average Remaining Contractual Life | Weighted | Number Exercisable | Weighted Average Exercise Price | ||
(in years) | Average | ||||||
Exercise | |||||||
Price | |||||||
$0.03 | 7,000,000 | 1.71 | $0.03 | 7,000,000 | $0.03 | ||
$0.50 | 202,000 | 1.5 | $0.50 | 202,000 | $0.50 | ||
7,202,000 | 1.71 | $0.04 | 7,202,000 | $0.04 | |||
Nature_of_Operations_and_Basis1
Nature of Operations and Basis of Presentation (Narrative) (Details) | 0 Months Ended | ||
Oct. 10, 2014 | Sep. 25, 2012 | Dec. 31, 2014 | |
EarthBlock Technologies Inc [Member] | Agreement of Share Exchange and Plan of Reorganization [Member] | |||
NatureOfOperationsAndBasisOfPresentationLineItems [Line Items] | |||
Percentage the ownership of the Company exchanged by the counterparty | 100.00% | ||
Shares of common stock of the counterparty received by the company | 63,666,400 | ||
Shares of common stock of the counterparty received by the company for each outstanding share | 4 | ||
Common stock shares issued to participating holders of Exchange Shares | 50,645,600 | ||
Additional common stock shares issued to participating holders of Exchange Shares | 7,030,400 | ||
Common stock shares hold by non participating holders of Exchange Shares | 7,560,000 | ||
EarthGen Biofuel Lao Sole Co Ltd [Member] | |||
NatureOfOperationsAndBasisOfPresentationLineItems [Line Items] | |||
Ownership interest percentage | 100.00% |
Significant_Accounting_Policie2
Significant Accounting Policies (Details Narrative) (USD $) | 3 Months Ended | |
Mar. 31, 2015 | Dec. 31, 2014 | |
Basic and diluted loss per common share | ||
Potentially dilutive common stock equivalents excluded from the calculation of diluted loss per common share (in shares) | 6,555,952 | |
Inventory | ||
Inventory reserve | $94,886 | $64,320 |
Inventory_Details
Inventory (Details) (USD $) | Mar. 31, 2015 | Dec. 31, 2014 |
Inventory | ||
Seeds | $0 | $0 |
Capitalized costs of growing crops | 569,314 | 551,314 |
Total inventory | 569,314 | 551,314 |
Less: inventory reserve | -94,886 | -64,320 |
Inventory, net | $474,428 | $486,994 |
Property_and_Equipment_Propert
Property and Equipment (Property and equipment) (Details) (USD $) | Mar. 31, 2015 | Dec. 31, 2014 |
Property, Plant and Equipment [Abstract] | ||
Machinery and equipment | $11,240 | $11,240 |
Automobile | 7,000 | 7,000 |
Office equipment | 4,216 | 4,216 |
Total | 22,456 | 22,456 |
Less: accumulated depreciation | -3,713 | -2,751 |
Property and equipment, net | $18,743 | $19,705 |
Property_and_Equipment_Narrati
Property and Equipment (Narrative) (Details) (USD $) | 3 Months Ended | |
Mar. 31, 2015 | Mar. 31, 2014 | |
Property, Plant and Equipment [Abstract] | ||
Depreciation expenses | $962 | $314 |
Due_from_Related_Parties_Narra
Due from Related Parties (Narrative) (Details) (USD $) | 3 Months Ended | ||
Mar. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Related Party Transaction [Line Items] | |||
Net funds provided to related party | $58,058 | $58,058 | |
Amount owned to related party | 60,476 | 55,641 | |
Debt maturity date | 30-Jul-15 | ||
Promissory note interest rate | 2.00% | ||
George Shen [Member] | |||
Related Party Transaction [Line Items] | |||
Amount owned to related party | 60,476 | 55,642 | |
Office rent under the month-to-month lease agreement | 3,360 | ||
Proceeds from related party debt | 2,000 | ||
Debt maturity date | 30-Jul-15 | ||
Promissory note interest rate | 2.00% | ||
Shareholder [Member] | |||
Related Party Transaction [Line Items] | |||
Proceeds from related party debt | 5,000 | ||
Debt maturity date | 30-Jul-13 | ||
EarthBlock Technologies Inc [Member] | |||
Related Party Transaction [Line Items] | |||
Net funds provided to related party | $56,958 | $58,058 |
Notes_Payable_Shortterm_loans_
Notes Payable (Short-term loans) (Details) (USD $) | Mar. 31, 2015 | Dec. 31, 2014 |
Total | $0 | $3,000 |
Promissory notes due to unrelated parties [Member] | ||
Total | $0 | $3,000 |
Notes_Payable_Narrative_Detail
Notes Payable (Narrative) (Details) | 3 Months Ended |
Mar. 31, 2015 | |
Notes Payable [Abstract] | |
Interest rate | 2.00% |
Interest rate default | 5.00% |
Debt maturity date | 30-Jul-15 |
Convertible_Note_Narrative_Det
Convertible Note (Narrative) (Details) (USD $) | 0 Months Ended | 3 Months Ended | ||
Dec. 15, 2014 | Oct. 29, 2014 | Sep. 30, 2014 | Mar. 31, 2015 | |
Short-term Debt [Line Items] | ||||
Interest rate (as a percent) | 5.00% | |||
Debt maturity date | 30-Jul-15 | |||
Beneficial conversion feature recorded as a debt discount | $16,376 | |||
Convertible Notes Payable [Member] | ||||
Short-term Debt [Line Items] | ||||
Face amount | 7,000 | 36,000 | 40,000 | |
Interest rate (as a percent) | 2.00% | 5.00% | 5.00% | |
Debt maturity date | 30-Jul-15 | 15-Dec-15 | 15-Sep-15 | |
Conversion price (in dollars per share) | $0.07 | $0.07 | $0.10 | |
Default interest rate (as a percent) | 5.00% | 2.00% | 2.00% | |
Intrinsic value of the beneficial conversion feature of debt | 63,000 | |||
Last sale price used to calculate intrinsic value of the beneficial conversion feature of debt (in dollars per share) | $0.15 | |||
Beneficial conversion feature recorded as a debt discount | $63,000 |
Stockholders_Equity_Summary_of
Stockholders' Equity (Summary of Status of Warrants Outstanding) (Details) | Mar. 31, 2015 | Dec. 31, 2014 |
Number of Shares | ||
Outstanding at December 31, 2014 | 7,202,000 | 7,202,000 |
Outstanding at March 31, 2015 | 7,202,000 | 7,202,000 |
Exercisable at March 31, 2015 | 7,202,000 |
Stockholders_Equity_Summary_of1
Stockholders' Equity (Summary of Information about Warrants Outstanding) (Details) (USD $) | 3 Months Ended | |
Mar. 31, 2015 | Dec. 31, 2014 | |
Options and Warrants Outstanding | ||
Number Outstanding | 7,202,000 | 7,202,000 |
Weighted Average Remaining Contractual Life | 1 year 8 months 16 days | |
Weighted Average Exercise Price | $0.04 | |
Options and Warrants Exercisable | ||
Number Exercisable | 7,202,000 | |
Weighted Average Exercise Price | $0.04 | |
Exercise Price One [Member] | ||
Options and Warrants Outstanding | ||
Number Outstanding | 7,000,000 | |
Weighted Average Remaining Contractual Life | 1 year 8 months 16 days | |
Weighted Average Exercise Price | $0.03 | |
Options and Warrants Exercisable | ||
Number Exercisable | 7,000,000 | |
Weighted Average Exercise Price | $0.03 | |
Exercise Price Two [Member] | ||
Options and Warrants Outstanding | ||
Number Outstanding | 202,000 | |
Weighted Average Remaining Contractual Life | 1 year 6 months | |
Weighted Average Exercise Price | $0.50 | |
Options and Warrants Exercisable | ||
Number Exercisable | 202,000 | |
Weighted Average Exercise Price | $0.50 |
Stockholders_Equity_Narrative_
Stockholders' Equity (Narrative) (Details) (USD $) | 1 Months Ended | ||
Mar. 27, 2014 | Mar. 31, 2015 | Dec. 31, 2014 | |
Equity [Abstract] | |||
Common stock, shares authorized | 690,000,000 | 690,000,000 | |
Common stock, par value (in dollars per share) | $0.00 | $0.00 | |
Preferred stock, shares authorized | 10,000,000 | 10,000,000 | |
Preferred stock, par value | $0.00 | $0.00 | |
Reverse stock split ratio | 1-for-25 | ||
Stock authorized | 700,000,000 | ||
Stock authorized before amendment to the articles of incorporation | 3,000,000,000 | ||
Common stock, shares issued | 75,794,151 | 75,080,817 | |
Common stock, shares outstanding | 75,794,151 | 75,080,817 |
Stockholders_Equity_Private_Pl
Stockholders' Equity (Private Placements of Common Stock) (Narrative) (Details) (USD $) | 3 Months Ended | |
Mar. 31, 2015 | Dec. 31, 2014 | |
Class of Stock [Line Items] | ||
Subscriptions payable received | $28,000 | |
Investor [Member] | ||
Class of Stock [Line Items] | ||
Shares of common stock issued | 713,334 | |
Aggregate amount of shares of common stock issued | 105,500 | |
Commissions paid | 0 | |
Subscriptions payable received | $28,000 | |
Subscriptions to issue common stock shares | 253,167 | |
Investor [Member] | Minimum [Member] | ||
Class of Stock [Line Items] | ||
Offering price (in dollars per share) | $0.08 | |
Investor [Member] | Maximum [Member] | ||
Class of Stock [Line Items] | ||
Offering price (in dollars per share) | $0.15 |
Stockholders_Equity_Restricted
Stockholders' Equity (Restricted Stock Awards Issued for Service) (Narrative) (Details) (USD $) | 3 Months Ended | 12 Months Ended | |
Mar. 31, 2015 | Mar. 31, 2014 | Dec. 31, 2014 | |
Class of Stock [Line Items] | |||
Awards granted to various consultants for their services | 0 | ||
Unrecognized compensation cost | $0 | ||
Stock-based compensation expense | 0 | 66,590 | |
Restricted Stock [Member] | |||
Class of Stock [Line Items] | |||
Awards granted to various consultants for their services | 3,299,267 | ||
Unrecognized compensation cost | $0 |
Stockholders_Equity_Warrants_N
Stockholders' Equity (Warrants) (Narrative) (Details) (USD $) | 3 Months Ended | ||||
Mar. 31, 2015 | Mar. 31, 2014 | Sep. 12, 2013 | Aug. 01, 2013 | Mar. 20, 2014 | |
Class of Warrant or Right [Line Items] | |||||
Exercise price of warrants (in dollars per share) | $0.04 | ||||
Total cash proceeds from warrants exercise | $50,500 | ||||
Warrant 2013 Private Placements [Member] | |||||
Class of Warrant or Right [Line Items] | |||||
Warrants issued | 1,600,000 | 6,400,000 | |||
Number of shares that can be purchased by holder of each warrant | 1 | ||||
Exercise price of warrants (in dollars per share) | $0.03 | $0.03 | $0.03 | ||
Warrants exercised | 1,000,000 | ||||
Total cash proceeds from warrants exercise | $31,250 | ||||
Warrant January 2014 Private Placements [Member] | |||||
Class of Warrant or Right [Line Items] | |||||
Warrants issued | 202,000 | ||||
Number of shares that can be purchased by holder of each warrant | 1 | ||||
Exercise price of warrants (in dollars per share) | $0.50 |
Commitments_and_Contingencies_
Commitments and Contingencies (Narrative) (Details) (USD $) | 3 Months Ended |
Mar. 31, 2015 | |
ha | |
Commitments and Contingencies Disclosure [Abstract] | |
Farm land leased (in hectares) | 136 |
Term of lease | 12 years |
Renewal term of lease | 12 years |
Maximum taxes on the land which company is obligated to pay in excess of that amount are the obligation of the landowner | $1,000 |
Compensation to the landowner per metric ton of castor beans harvested | 50 |
Additional area leased | 103 |
Subsequent_Events_Narrative_De
Subsequent Events (Narrative) (Details) (USD $) | 3 Months Ended | 2 Months Ended | |
Mar. 31, 2015 | Mar. 31, 2014 | 18-May-15 | |
Subsequent Event [Line Items] | |||
Proceeds from issuance of common stock | $105,500 | $621,130 | |
Subsequent Event [Member] | |||
Subsequent Event [Line Items] | |||
Proceeds from issuance of common stock | $101,500 | ||
Shares of common stock issued | 1,450,000 | ||
Offering price (in dollars per share) | $0.07 |