Document_and_Entity_Informatio
Document and Entity Information (USD $) | 12 Months Ended | ||
Dec. 31, 2014 | Apr. 15, 2015 | Jun. 30, 2014 | |
Document And Entity Information | |||
Entity Registrant Name | Elite Data Services, Inc. | ||
Entity Central Index Key | 704366 | ||
Document Type | 10-K | ||
Document Period End Date | 31-Dec-14 | ||
Amendment Flag | FALSE | ||
Current Fiscal Year End Date | -19 | ||
Is Entity a Well-known Seasoned Issuer | No | ||
Is Entity a Voluntary Filer | No | ||
Is Entity's Reporting Status Current | Yes | ||
Entity Filer Category | Smaller Reporting Company | ||
Entity Public Float | $0 | ||
Entity Common Stock, Shares Outstanding | 21,773,282 | ||
Document Fiscal Period Focus | FY | ||
Document Fiscal Year Focus | 2014 |
CONSOLIDATED_BALANCE_SHEETS
CONSOLIDATED BALANCE SHEETS (USD $) | Dec. 31, 2014 | Dec. 31, 2013 | |
Current Assets | |||
Cash | $659 | $2,884 | |
Prepaid expense | 820,882 | ||
Total Assets | 821,541 | 2,884 | |
Current Liabilities | |||
Accounts payable and accrued liabilities | 606,221 | 313,202 | |
Line of credit payable | 151,000 | 151,000 | |
Loans from a related party | 139,029 | 37,424 | |
Loan payable | 13,325 | ||
Contingent consideration payable | 566,212 | 906,574 | |
Total Current Liabilities | 1,475,787 | 1,408,200 | |
LONG TERM DEBT: | |||
Note payable, related party | 587,564 | ||
Total Liabilities | 2,063,351 | 1,408,200 | |
Stockholders' Deficit | |||
Preferred stock, $0.0001 par value; 10,000,000 shares Series A authorized; issued and outstanding 0, respectively | |||
Common stock, $0.0001 par value; 50,000,000 shares authorized; issued and outstanding 19,219,070 and 150,488, respectively | 1,922 | 15 | [1] |
Stock subscriptions | 155,000 | ||
Additional paid-in capital | 7,581,444 | 4,907,380 | |
Deficit accumulated | -8,825,176 | -6,467,711 | |
Total Stockholders' Deficit | -1,241,810 | -1,405,316 | |
Total Liabilities and Stockholders' Deficit | $821,541 | $2,884 | |
[1] | On the effective date of the reverse split, all outstanding shares of the Company's common stock were converted at the reverse split ratio of 1 for 1,300. This has been presented on a retroactive basis in the consolidated financial statements. |
CONSOLIDATED_BALANCE_SHEETS_Pa
CONSOLIDATED BALANCE SHEETS (Parenthetical) (USD $) | Dec. 31, 2014 | Dec. 31, 2013 |
Stockholders' Deficit | ||
Preferred stock Series A, par value | $0.00 | $0.00 |
Preferred stock Series A, Authorized | 10,000,000 | 10,000,000 |
Preferred stock Series A, Issued | 0 | 0 |
Preferred stock Series A, outstanding | 0 | 0 |
Common stock, par value | $0.00 | $0.00 |
Common stock, Authorized | 50,000,000 | 50,000,000 |
Common stock, Issued | 19,219,070 | 150,488 |
Common stock, outstanding | 19,219,070 | 150,488 |
CONSOLIDATED_STATEMENTS_OF_OPE
CONSOLIDATED STATEMENTS OF OPERATIONS (USD $) | 12 Months Ended | ||
Dec. 31, 2014 | Dec. 31, 2013 | ||
Consolidated Statements Of Operations | |||
REVENUES | $15,015 | ||
OPERATING EXPENSES | |||
Project development costs | 29,139 | 21,999 | |
Consulting services | 43,840 | 261,536 | |
Investor relations | 75,274 | ||
General and administrative | 182,871 | 147,434 | |
Total Operating Expenses | 331,124 | 430,969 | |
LOSS FROM OPERATIONS | -316,109 | -430,969 | |
OTHER INCOME (EXPENSE): | |||
Impairment of intangible assets | -589,041 | ||
Loss on extinguishment of debt | 1,361,448 | ||
Interest expense - related party | -58,842 | -41,185 | |
Interest expense - other | -32,025 | ||
Total Other Expense | -2,041,356 | -41,185 | |
LOSS BEFORE PROVISION FOR INCOME TAXES | -2,357,465 | -472,154 | |
PROVISION FOR INCOME TAX (BENEFIT) | |||
NET LOSS | ($2,357,465) | ($472,154) | |
Basic and Diluted Per Share Data: Net Loss Per Share - basic and diluted | ($0.14) | ($5.70) | |
Weighted Average Common Shares Outstanding: Basic and diluted | 16,393,316 | 85,640 | [1] |
[1] | On the effective date of the reverse split, all outstanding shares of the Company's common stock were converted at the reverse split ratio of 1 for 1,300. This has been presented on a retroactive basis in the consolidated financial statements. |
CONSOLIDATED_STATEMENT_OF_STOC
CONSOLIDATED STATEMENT OF STOCKHOLDERS' DEFICIT (USD $) | Preferred Stock | Common Stock | Stock Subscriptions | Additional Paid-In Capital | Accumulated Deficit | Total |
Beginning balance, amount at Dec. 31, 2012 | $1 | $2 | $4,389,052 | ($5,995,557) | ($1,606,502) | |
Beginning balance, shares at Dec. 31, 2012 | 8,811 | 63,486 | ||||
Issuance of warrants | 140,000 | 140,000 | ||||
Issuance of preferred stock | 40 | 40 | ||||
Cashless conversion of warrants to common stock, shares | 385 | |||||
Conversion of warrants to common stock, amount | 1 | 298,299 | 298,300 | |||
Conversion of warrants to common stock, shares | 16,923 | |||||
Issuance of common stock in exchange for preferred stock, amount | -1 | 2 | -1 | |||
Issuance of common stock in exchange for preferred stock, shares | -9,113 | 70,032 | ||||
Subscription agreements | 155,000 | 155,000 | ||||
Effect of reverse stock split, shares | -320 | |||||
Forgiveness of debt by former CEO | 80,000 | 80,000 | ||||
Net loss for the year | -472,154 | -472,154 | ||||
Ending balance, amount at Dec. 31, 2013 | 15 | 155,000 | 4,907,380 | -6,467,711 | -1,405,316 | |
Ending balance, shares at Dec. 31, 2013 | 150,488 | |||||
Rounding adjustment, shares | 38 | |||||
Common stock issued for debt conversion, amount | 340 | 1,701,470 | 1,701,810 | |||
Common stock issued for debt conversion, shares | 3,403,620 | |||||
Common stock issued for services, amount | 75 | 374,925 | 375,000 | |||
Common stock issued for services, shares | 750,000 | |||||
Warrants issued | 522,684 | 522,684 | ||||
Shares issued for intangible assets, amount | 1,477 | 1,477 | ||||
Shares issued for intangible assets, shares | 14,765,000 | |||||
Subscription agreements exercised, amount | 15 | -75,000 | 74,985 | |||
Subscription agreements exercised, shares | 150,000 | |||||
Subscription agreements not exercised | -80,000 | -80,000 | ||||
Net loss for the year | -2,357,465 | -2,357,465 | ||||
Ending balance, amount at Dec. 31, 2014 | $1,922 | $7,581,444 | ($8,825,176) | ($1,241,810) | ||
Ending balance, shares at Dec. 31, 2014 | 19,219,070 |
CONSOLIDATED_STATEMENTS_OF_CAS
CONSOLIDATED STATEMENTS OF CASH FLOWS (USD $) | 12 Months Ended | |
Dec. 31, 2014 | Dec. 31, 2013 | |
OPERATING ACTIVITIES: | ||
Net loss | ($2,357,465) | ($472,154) |
Adjustments to reconcile net loss to net cash used in opearting activities | ||
Impairment of intangible assets | 589,041 | |
Loss on extinguishment of debt | 1,361,448 | |
Non-cash consulting expenses | 35,274 | 40 |
Warrants issued for services | 41,528 | 140,000 |
Changes in operating assets and liabilities: | ||
Accounts payable and accrued expenses | 213,019 | 69,435 |
Income taxes payable | -1,750 | |
Loans payable to related parties | 30,922 | |
Net cash used in operating activities | -117,155 | -233,507 |
Financing Activities: | ||
Proceeds from subscription agreements | 155,000 | |
Proceeds from notes payable | 13,325 | |
Proceeds from related parties | 101,605 | 80,799 |
Net cash provided by financing activities | 114,930 | 235,799 |
NET (DECREASE) INCREASE IN CASH | -2,225 | 2,292 |
CASH BEGINNING OF THE YEAR | 2,884 | 592 |
CASH END OF THE YEAR | 659 | 2,884 |
SUPPLEMENTAL DISCLOSURES: | ||
Cash paid for interest | ||
Cash paid for taxes | ||
SUPPLEMENTAL DISCLOSURE OF NON-CASH INVESTING AND FINANCING ACTIVITIES: | ||
Issuance of common stock in connection with the purchase of Classifiedride.com | 1,400 | |
Issuance of common stock in connection with the purchase of Autoglance, LLC | 77 | |
Issuance of common stock for conversion of debt | 1,701,810 | |
Note payable for the purchase of classifiedride.com (NOTE 4) | 587,564 | |
Issuance of common stock for Investor relation service | $375,000 |
DESCRIPTION_OF_BUSINESS
DESCRIPTION OF BUSINESS | 12 Months Ended | ||||
Dec. 31, 2014 | |||||
Description Of Business | |||||
NOTE 1 - DESCRIPTION OF BUSINESS | Overview | ||||
Elite Data Services, Inc. (hereinafter the “Company”, “Our”, “We” or “Us”) is a technology Company whose software applications are developed to market and advertise assets that the Company owns and controls. Currently, we have been focused on the development of our automotive platforms and have begun expanding into the hospitality and gaming arena, focalizing our efforts on the island of Roatan, the largest of the bay islands of Honduras. On April 6, 2015, we acquired a gaming distribution license for two cities on the Honduras mainland and Roatan, the largest of the bay islands. The Company will be focusing on implementing gaming machines and continue to use its existing platform technologies to maximize its revenue under its business plan. –See NOTE 9. | |||||
History | |||||
Elite Data Services, Inc. changed its name from Dynamic Energy Alliance Corporation on November 4, 2013. Prior to that, we were formerly Mammatech Corporation, and were incorporated in the State of Florida on November 23, 1981 under the name Mammathetics Corp. From 1981 through the first quarter of 2011, the Company’s business was that of a marketer of tumor detection equipment. | |||||
Merger Acquisition by way of Share Exchange | |||||
On March 9, 2011, the Company effectively completed a merger transaction whereby it entered into a Share Exchange Agreement (“SEA”) with DEDC, becoming a wholly-owned subsidiary of the Company. The share transactions to complete the merger transaction are hereinafter collectively referred to as the “Merger.” All costs incurred in connection with the Merger have been expensed. In addition, the director and officer of the Company was replaced by the directors and officers of DEDC. Following the Merger, the Company abandoned its prior business and concurrently adopted DEDC’s business plan in the recoverable energy sector. In connection with this, the Company planned to develop, commercialize, and sell innovative technologies relating to the energy sector. | |||||
History of Transformation Consulting, Inc. | |||||
In conjunction with the acquisition of DEDC, the Company acquired Transformation Consulting (‘TC”), a wholly-owned subsidiary of DEDC. TC provides business development, marketing, and administrative consulting services. Through a January 2010 management services and a related agency agreement (“Agency Agreement”), TC received revenues from a related party based on billings received from TC’s direct consumer membership club products that were transferred to the related party under the Agency Agreement. | |||||
In March 9, 2011, DEDC acquired all of the outstanding shares, of TC pursuant to a Stock Purchase Agreement between a former director of the Company (“the Director”) and DEDC, dated February 25, 2011 and Amendments No. 1, 2 and 3 to Stock Purchase Agreement, dated December 30, 2011, March 31, 2012 and September 26, 2012, respectively. The purchase price for the Shares was $2,000,000, payable from the gross revenues (pre-tax) of TC, as received, subject to the following contingent reduction or increase of the purchase price. Under the original agreement (which is not currently in effect to date), if TC’s gross revenues during the two years following the closing were less than $2,000,000, then the purchase price for the shares would be reduced to the actual revenue received by TC during the two year period. If TC’s revenues during the same two year period exceed $2,000,000, then the purchase price for the shares would be increased by one-half of the excess revenues over $2,000,000 (“contingent consideration”). At the time of the acquisition, TC had minimal tangible assets and the entire $2,000,000 purchase price was allocated to a customers’ list intangible asset. | |||||
Through December 31, 2012, TC’s gross revenues under the Stock Purchase Agreement totaled approximately $2,000,000. Through December 31, 2012, payments of the purchase price, net of refunds, totaled $984,638. At December 31, 2012 and 2013, the contingent consideration payable was $1,015,362 and $906,574, respectively. Under an amended payment schedule, the contingent consideration owing was due December 15, 2012. Under this original agreement, the Company needed funding to fulfill its financial obligations and was in default for non-payment. | |||||
Habanero Properties Purchase of Controlling Ownership of Company | |||||
On September 30, 2013 Habanero Properties LTD entered into an Assignment and Assumption Agreement with Harvey Dale Cheek, and Charles R. Cronin, Jr. (the “Assignment”). Pursuant to the Assignment, Habanero Properties LTD acquired 102,693,795 shares of Common Stock equal to 52.38% of the Company. As a result of the acquisition of these shares pursuant to the Assignment, a change of control of the Company occurred and Habanero Properties LTD became a majority shareholder. | |||||
Additionally, on September 30, 2013, the Company entered into a series of repurchase agreements (the “Repurchase”) with each of the holders of its Series A Convertible Preferred Stock. The Company entered into the Repurchase in order to eliminate future dilutive issuances as a result of the make good provisions in the Company’s Series A Preferred Stock. By entering into the Repurchase, the Company was also able to reduce its convertible share exposure by 33% and eliminate the 75% override control held by the Series A Preferred Stock holders. In exchange for the Repurchase, each of the Series A Preferred Stock holders were issued common stock in the Company based on a weighted average conversion rate of 67% of the conversion rate owed to each of the Series A Preferred Stock holders pursuant to the current terms of the Series A Preferred Stock. | |||||
Pursuant to the terms of the Repurchase, the following individuals were issued shares of common stock in exchange for the repurchase of their Series A Preferred Stock. The issued 91,042,112 shares of common stock to the Preferred Holders set forth in the table below based on a weighted average conversion rate of 67% of the conversion rate owed to Preferred Holders pursuant to the current terms of the Series A Preferred Stock. A total of 91,041,112 shares of Common Stock of the Company were issued pursuant to the Repurchase. The Repurchase shares were exempt from registration pursuant to Section 3(a)(9) of the Securities Act of 1933, as amended. | |||||
Name | Shares of | ||||
Common Stock | |||||
Charles R. Cronin Jr. | 54,953,990 | ||||
James Michael Whitfield | 15,094,386 | ||||
Harvey Dale Cheek | 17,725,860 | ||||
Dr. Earl Beaver | 3,267,876 | ||||
TOTAL | 91,042,112 | ||||
On September 30, 2013, in connection with the acquisition by Habanero Properties of approximately 52.38% of the issued and outstanding shares of common stock of the Company, each of the Officers and Directors of the Company tendered their resignation, with the understanding that such resignation would be effective immediately for the Officers. Immediately prior to tendering their resignation, the Board of directors unanimously approved the appointment of three new Officers and three new Directors effective immediately. | |||||
Additionally, on September 30, 2013, the Board of Directors of the Company voted to adopt a new set of bylaws for the Company. The new bylaws became effective immediately upon adoption. As the market for high end financing suffered due to the downtown in the economy, the Company’s prior management assessed the future of the Company for acquisitions relating to TC’s marketing and advertising strategies. | |||||
During this period, the Board of Directors assessed DEDC’s business plans and progress in order to determine the feasibility of going forward on DEDC’s business plan and determined conclusively it was not in the Company’s best interest based on past operations and significant reliance on external financing. The Company then concentrated on the marketing and advertising solutions under its TC business model that had generated the most revenue for the Company in the past. Since September 30, 2013, the Company focused on TC’s business model involving advertising and marketing services. | |||||
Related Party Transactions with Baker Myers & Associates, LLC | |||||
On January 13, 2014, the Company entered into an asset purchase agreement with Baker Myers and Associates, LLC (“Baker Myers LLC”) to acquire www.classifiedride.com, an online selling and buying platform for automotive markets. As consideration for the sale, the Company entered into a promissory note for $3,000,000 with an interest rate calculated at $17,500 per month and issued 14,000,000 shares of the Company’s common stock. Ms. Myers is the sole managing member of Baker Myers LLC and currently serves the Company as both an Officer and Director. At June 30, 2014, the carrying value of the asset was reduced pursuant to the transaction being made by a related party under GAAP ASC 805-50-30, thereby reducing the value of the asset by $2,412,436. As a result, the Baker Myers note was restated such that the principal amount was reduced to $587,564 and interest re-calculated from the contract date based on the reduced principal balance of the note. | |||||
Launched to the public in February 2012, ClassifiedRide provides a classified listing platform where users list their vehicle, truck, boat (i.e. anything that has a motor) to the Company’s website (either by free or paid listing options). The main premise of the website is to aid the private seller in selling or trading their vehicle. The Company, in turn, then works as the community leader to establish relationships between buyers and sellers using social media platforms and consumer customer support incentives. These relationships are used to generate revenue from private sellers, dealerships, affiliate lead providers, and third party advertisers. The Company has currently been in the process of implementing some coding changes and debugging its interface. – See NOTE 4. | |||||
On January 15, 2014, the Company entered into an Asset Purchase Agreement with Baker Myers LLC for 51% of the membership interest of Autoglance, LLC, a Tennessee Limited Liability Company, and with it majority control over all owned assets of Autoglance, LLC, including the website www.autoglance.com (collectively “Autoglance”) for 765,000 shares of the Company’s common stock as consideration. Autoglance is a search engine of used cars that prioritizes and compares inventory in individualized markets by displaying the best deals first while hiding listings that are older, more expensive, and have more mileage. More specifically, Autoglance’s algorithm groups vehicles of the same make and model per demographic area to determine the best price based on the market value of the vehicle. Vehicles that are deemed worse deals are hidden from the user. The user can easily see hidden cars if he/she wishes by the click of a button. -- See NOTE 4. | |||||
Securities Purchase Agreement and Promissory Note with H y H Investments, S.A. | |||||
The Company entered in an Option Purchase Agreement with H y H Investments, S.A. (“H y H”) on November 30, 2014, giving the Company the option to purchase Inversiones Turisticas Gaming Unlimited S.A., a Honduras corporation whose sole assets consisted of a casino license with five tables and one hundred and fifty gaming machines for use in the municipality of Roatan. On January 12, 2015, the Company entered into an amended option purchase agreement, which extended the option date to February 28, 2015. The Company did not choose to exercise the option, in part, because of a potential gaming distributor license that H y H had available that aligned more fluently with the Company’s business model. | |||||
On April 6, 2015, the Company acquired a distributor license to operate gaming machines from H y H for select cities in Honduras and Roatan, the largest of the bay islands. Pursuantly, the Company entered into a Securities Purchase and Promissory Note with H y H Investments, S.A to acquire all of the capital stock of its Honduras corporation, whose sole assets consist of a license to operate a total of Three Hundred and Twenty (320) gaming machines distributable at Eighty (80) machines each for the cities of La Lima and Trujillo (located on the Honduras mainland), and One Hundred and Sixty (160) gaming machines distributable in the bay island of Roatan. -- See NOTE 9. | |||||
Principles of Consolidation | |||||
The consolidated financial statements include the accounts of the Company and its wholly-owned subsidiaries, Dynamic Energy Development Corporation (DEDC), which is inactive and Transformation Consulting (TC), which is also inactive. All significant inter-company accounts have been eliminated in consolidation. |
GOING_CONCERN
GOING CONCERN | 12 Months Ended |
Dec. 31, 2014 | |
Going Concern | |
Note 2 - GOING CONCERN | Since inception, the Company has a cumulative net loss of $8,825,176. The Company currently has only limited working capital with which to continue its operating activities. The amount of capital required to sustain operations is subject to future events and uncertainties. The Company must secure additional working capital through loans, sale of equity securities, or a combination, in order to implement its current business plans. There can be no assurance that such funding will be available in the future, or available on commercially reasonable terms favorable to the Company. These conditions raise substantial doubt about the Company's ability to continue as a going concern. |
The accompanying financial statements have been presented on the basis of the continuation of the Company as a going concern and do not include any adjustments relating to the recoverability and classification of recorded asset amounts or the amounts and classifications of liabilities that might be necessary should the Company be unable to continue as a going concern. | |
Prior management continued to manage its costs for 2014 to ensure appropriate funding is on hand for its operation. |
SUMMARY_OF_SIGNIFICANT_ACCOUNT
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | 12 Months Ended | ||
Dec. 31, 2014 | |||
Summary Of Significant Accounting Policies | |||
NOTE 3 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | Basis of Presentation | ||
The consolidated financial statements have been prepared in accordance with generally accepted accounting principles and include the accounts of the Company and its subsidiaries, Dynamic Energy Development Corporation and Transformation Consulting, Inc.. All intercompany balances and transactions have been eliminated. | |||
Reclassifications | |||
Certain reclassifications have been made in Statement of Operations during the year ended December 31, 2014. These reclassifications impacted the classification of certain items within the Statement of Operations: relating to classification of consulting expenses and project development costs. The reclassifications had no impact on previously reported total operating expenses, net loss, or stockholders' equity. | |||
Valuation of Intangible Assets and Note Payable to Related Party | |||
The Company’s intangible asset value and note balance to a related party were reduced to the appropriate carrying value of $587,564 as of June 30, 2014. An impairment loss of $589,041 has been charged to intangible assets since the fair value is less than the carrying amount as of the year end. As of December 31 2014, the intangible assets carrying value is $0. | |||
Development Costs | |||
Development costs are expensed in the period they are incurred unless they meet specific criteria related to technical, market and financial feasibility, as determined by management, including but not limited to the establishment of a clearly defined future market for the product, and the availability of adequate resources to complete the project. If all criteria are met, the costs are deferred and amortized over the expected useful life, or written off if a product is abandoned. For the years ended December 31, 2014 and 2013, total development costs amounted to $29,139 and $21,999, respectively. At December 31, 2014 and 2013, the Company had no deferred product development costs. | |||
Cash | |||
Cash and cash equivalents, if any, include all highly liquid instruments with an original maturity of three months or less at the date of purchase. At December 31, 2014 and 2013, the Company had no cash equivalents. | |||
Financial Instruments and Concentration of Risk | |||
The fair values of financial instruments, which include cash, accounts payable and accrued liabilities and convertible notes, were estimated to approximate their carrying values due to the immediate or relatively short maturity of these instruments. Management does not believe that the Company is subject to significant interest, currency or credit risks arising from these financial instruments. | |||
Impairment of Long-Lived Intangible Assets | |||
We review our long-lived assets, including intangible assets subject to amortization, for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. When such factors and circumstances exist, we compare the projected undiscounted future cash flows associated with the future use and disposal of the related assets or group of assets to their respective carrying amounts. Impairment, if any, is measured as the excess of the carrying amount over the fair value based on market value (when available) or discounted expected cash flows of those assets, and is recorded in the period in which the determination is made. Intangible assets not subject to amortization are tested annually for impairment and more frequently if events or changes in circumstances indicate that it is more likely than not that the asset is impaired. These tests were performed for the year ended December 31, 2014 and an impairment loss of $589,041 has been charged to intangible assets since the fair value is less than the carrying amount as of the year end. | |||
Fair Value of Financial Instruments | |||
The Company accounts for the fair value of financial instruments in accordance with the FASB ASC Topic 820, Fair Value Measurements and Disclosures ("Topic 820"). Topic 820 defines fair value, establishes a three-level valuation hierarchy for disclosures of fair value measurement and enhances disclosure requirements for fair value measures. | |||
The three levels are defined as follows: | |||
Level 1 | inputs to the valuation methodology are quoted prices (unadjusted) for identical assets or liabilities in active markets. | ||
Level 2 | inputs to the valuation methodology include quoted prices for similar assets and liabilities in active markets, and inputs that are observable for the asset or liability, either directly or indirectly, for substantially the full term of the financial instrument. | ||
Level 3 | inpuinputs to the valuation methodology are unobservable and significant to the fair measurement. | ||
The fair value of the Company's cash, accounts payable, and accrued expenses approximate carrying value because of the short-term nature of these items. | |||
Management believes it is not practical to estimate the fair value of loan to related parties because the transactions cannot be assumed at arm's length, the terms are not deemed to be market terms, there are no quoted values available for these instruments, and an independent valuation would not be practical due to the lack of data regarding similar instruments, if any, and the associated potential costs. | |||
Revenue Recognition | |||
The Company recognizes revenue in accordance with the FASB ASC Section 605-10-S99, Revenue Recognition, Overall, SEC Materials ("Section 605-10-S99"). Section 605-10-S99 requires that four basic criteria must be met before revenue can be recognized: (1) persuasive evidence of an arrangement exists; (2) delivery has occurred or services rendered; (3) the fee is fixed and determinable; and (4) collectability is reasonably assured. | |||
Loss Per Common Share | |||
Basic loss per common share (“EPS”) is calculated by dividing the net loss available to common shareholders by the weighted average number of common shares outstanding for the period. Diluted EPS reflects the potential dilution that could occur if securities or other contracts to issue common stock were exercised or converted into common stock. The number of common shares that are exercisable or converted into common stock is not material to effect diluted EPS results. Further, since the Company shows losses for the periods presented basic and diluted loss per share are the same for all periods presented. As of December 31, 2014 and 2013, there were no outstanding dilutive securities. | |||
Income Taxes | |||
Potential benefits of income tax losses are not recognized in the accounts until realization is more likely than not. The Company has adopted the accounting standards codified in ASC 740, Income Taxes as of its inception. Pursuant to those standards, the Company is required to compute tax asset benefits for net operating losses carried forward. Potential benefit of net operating losses have not been recognized in these financial statements because the Company cannot be assured it is more likely than not that it will utilize the net operating losses carried forward in future years. | |||
ASC 740-10-25 prescribes recognition thresholds that must be met before a tax position is recognized in the financial statements and provides guidance on de-recognition, classification, interest and penalties, accounting in interim periods, disclosure, and transition. An entity may only recognize or continue to recognize tax positions that meet a "more likely than not" threshold. Based on its evaluation, the Company has concluded that there are no significant uncertain tax positions requiring recognition in its financial statements. | |||
The Company does not have any unrecognized tax benefits as of December 31, 2014 and 2013 that, if recognized, would affect the Company's effective income tax rate. The Company's policy is to recognize interest and penalties related to income tax issues as components of income tax expense. The Company did not recognize or have any accrual for interest and penalties relating to income taxes as of December 31, 2014 and 2013. | |||
Common Share Non-Monetary Consideration | |||
In situations where common shares are issued and the fair value of the goods or services received is not readily determinable, the fair value of the common shares is used to measure and record the transaction. The fair value of the common shares issued in exchange for the receipt of goods and services is based on the stock price as of the earliest of the date at which: | |||
i. | the counterparty’s performance is complete; | ||
ii. | commitment for performance by the counterparty to earn the common shares is reached; or | ||
iii. | the common shares are issued if they are fully vested and non-forfeitable at that date. | ||
Stock-Based Compensation | |||
On December 1, 2005, the Company adopted the fair value recognition provisions codified in ASC 718, Compensation-Stock Compensation. The Company adopted those provisions using the modified-prospective-transition method. Under this method, compensation cost recognized for all periods prior to December 1, 2005 includes: a) compensation cost for all share-based payments granted prior to, but not yet vested as of November 30, 2005, based on the grant-date fair value and b) compensation cost for all share-based payments granted subsequent to November 30, 2005, based on the grant-date fair value. In addition, deferred stock compensation related to non-vested options is required to be eliminated against additional paid-in capital. The results for periods prior to December 1, 2005 were not restated. | |||
The Company accounts for equity instruments issued in exchange for the receipt of goods or services from parties other than employees in accordance with ASC 505, Equity. Costs are measured at the estimated fair market value of the consideration received or the estimated fair value of the equity instruments issued, whichever is more reliably measurable. The value of equity instruments issued for consideration other than employee services is determined on the earliest of a performance commitment or completion of performance by the counterparty. | |||
Share Purchase Warrants | |||
The Company accounts for common share purchase warrants at fair value in accordance with ASC 815, Derivatives and Hedging. The Black-Scholes option pricing valuation method is used to determine fair value of these warrants. Use of this method requires that the Company make assumptions regarding stock volatility, dividend yields, expected term of the warrants and risk-free interest rates. | |||
Recently and Issued Accounting Pronouncements | |||
In May 2014, the FASB issued ASU 2014-09, “Revenue from Contracts with Customers.” ASU 2014-09 requires an entity to recognize the amount of revenue to which it expects to be entitled for transfer of promised goods or services to customers. ASU-2014-09 will replace most existing revenue recognition guidance in U.S. GAAP when it becomes effective. The amendments in this update also require disclosure of sufficient information to allow users to understand the nature, amount, timing and uncertainty of revenue and cash flow arising from contracts. ASU-2014-09 is effective for annual and interim reporting periods beginning after December 15, 2016, using one of two retrospective application methods. Early application is not permitted. The Company is currently evaluating the effect that the adoption of ASU 2014-09 will have on the Company’s consolidated financial statements. | |||
In August 2014, the FASB issued ASU No. 2014-15, “Disclosure of Uncertainties about an Entity’s Ability to Continue as a Going Concern” (Subtopic 205-40), which defines management's responsibility to evaluate whether there are conditions or events that raise substantial doubt about the entity’s ability to continue as a going concern and to provide related disclosures. Currently, this evaluation has only been an auditor requirement. Specifically, the amendments (1) provide a definition of the term “substantial doubt,” (2) require an evaluation every reporting period, (3) provide principles for considering the mitigating effect of management’s plans, (4) require certain disclosures when substantial doubt is alleviated as a result of the consideration of management’s plans, (5) require an express statement and other disclosures when substantial doubt is not alleviated, and (6) require an assessment for a period of one year after the date that financial statements are issued. This amended guidance will be effective for us beginning January 1, 2016. The Company does not expect the adoption of this amended guidance to have a significant impact on its Consolidated Financial Statements. | |||
Other recent accounting pronouncements issued by the FASB (including its Emerging Issues Task Force), the AICPA, and the SEC during the current reporting period did not, or are not, believed by management to have a material impact on the Company’s present or future consolidated financial statements. |
RELATED_PARTY_TRANSACTIONS_AND
RELATED PARTY TRANSACTIONS AND AMOUNTS OWING | 12 Months Ended | ||||||||
Dec. 31, 2014 | |||||||||
Related Party Transactions And Amounts Owing | |||||||||
NOTE 4 - RELATED PARTY TRANSACTIONS AND AMOUNTS OWING | Myers - LOC | ||||||||
The principle amount due Sarah Myers (director and executive officer of the Company, the related party) at December 31, 2014 and December 31, 2013 was $139,029 and $37,424, respectively, represents an unsecured promissory note and addendums (“Myers – LOC”). These amounts are unsecured and bear interest at the rate of 12% per annum. The Myers – LOC has been amended to be due and payable on December 31, 2015. The accrued interest under the Myers – LOC as of December 31, 2014 and 2013 was $18,562 and $3,924, respectively. | |||||||||
January 13, 2014 Agreement - ClassifiedRide | |||||||||
On January 13, 2014, the Company entered into an asset purchase agreement with Baker Myers and Associates, LLC (“Baker Myers”) to acquire certain assets including, www.classifiedride.com, an online classified listing website where private sellers can buy, sell, and trade their vehicle. Ms. Myers is the managing member and sole owner of Baker Myers, and also serves as an Officer and Director of the Company. As consideration for the sale, the Company entered into a promissory note for $3,000,000 with an interest rate of 7% per annum and issued 14,000,000 shares of the Company’s common stock. At June 30, 2014, the carrying value of the assets was reduced pursuant to the transaction being made by a related party under GAAP ASC 805-50-30, thereby reducing the value of the asset by $2,412,436 to $587,564. As a result, the Baker Myers note was restated such that the principal amount was reduced to $587,564, the interest rate was set at 8% per annum, and interest re-calculated from the contract date based on the reduced principal balance of the note. At December 31, 2014, the note balance and accrued interest was $587,487 and $44,203, respectively. | |||||||||
January 15, 2014 Agreement – Autoglance | |||||||||
On January 15, 2014, the Company entered into an Agreement with Baker Myers for 51% of the membership interest of Autoglance, LLC, a Tennessee Limited Liability Company, and with it majority control over all owned assets of Autoglance, LLC, including the website www.autoglance.com (collectively “Autoglance”) for 765,000 shares the Company’s common stock as consideration. | |||||||||
Contingent Consideration Payable | |||||||||
Pursuant to Stock Purchase Agreement between a former director of the Company (“the Director”) and DEDC, dated February 25, 2011 and Amendments No. 1, No. 2 and No. 3 to Stock Purchase Agreement, dated December 30, 2011, March 31, 2012 and September 26, 2012, respectively, DEDC acquired all of the outstanding shares, of Transformation Consulting, Inc. (“TC”). The purchase price for the shares was $2,000,000, payable from the gross revenues of TC, subject to the following contingent reduction or increase of the purchase price. If TC’s gross revenues during the two years following the closing was less than $2,000,000, then the purchase price for the shares would be reduced to the actual revenue received by TC during the two year period. If TC’s revenues during the same two year period exceed $2,000,000, then the purchase price for the shares would be increased by one-half of the excess revenues over $2,000,000 (“contingent consideration”). | |||||||||
TC’s revenues were primarily related to revenues received from an entity controlled by the Director (“related entity”) under a January 2010, Management Services and Agency Agreement (“Agency Agreement”). Under the Agency Agreement, TC received revenues based on billings received from certain of TC’s direct to consumer membership club products that were transferred to the related entity under the Agency Agreement. Pursuant to the Agency Agreement, TC agreed to (1) transfer to the related entity the ownership of certain TC current direct to consumer membership products upon TC receiving a total of $1,000,000 in revenues; (2) introduce the related entity to TC’s existing and potential vendors for use in managing the TC current programs on behalf of TC; and (3) have the related entity act as TC’s sales agent for new product sales. In consideration, TC receives all gross receipts of existing sales, less the related entity’s management fee of 20% of gross sales. Separately, TC and the related entity would each be entitled to 50% of new business sales. After total payments of $2,000,000 to TC from all related revenues under the Agency Agreement, the related entity would no longer be obligated to pay TC any further compensation. | |||||||||
Pursuant to the contingent consideration of $2,000,000 due to the Director from TC, all revenues generated by TC under the Agency Agreement were disbursed to the former Director. Contingent consideration is payable based on a payment schedule, as amended, as follows: | |||||||||
Payment one: the first $900,000 of gross revenues paid on receipt; | |||||||||
Payment two: the next $115,944 of gross revenues paid at the later of 90 days of receipt or June 30, 2012; | |||||||||
For the years ended December 31, 2013 and 2012, TC gross revenues totaled $-0- and $1,580,302, respectively. Through December 31, 2012, TC gross revenues under the TC Stock Purchase Agreement totaled approximately $2,000,000. | |||||||||
Through December 31, 2013, payments, net of refunds, made to Director under the TC Stock Purchase Agreement totaled $984,638. Part of the outstanding balance owed at the time of exercise of the warrants was offset towards the payment of the warrants exercised at their strike price and aggregated $108,788. As part of the Assignment and Assumption Agreement entered into by Charles Cronin, Harvey Dale Cheek and Habanero Properties dated September 30, 2013, TC assigned this debt to Habanero Properties. At December 31, 2014 and 2013, the contingent consideration payable is as follows: | |||||||||
As of | As of | ||||||||
December 31, | December 31, | ||||||||
2014 | 2013 | ||||||||
Contingent consideration due | $ | 2,000,000 | $ | 2,000,000 | |||||
Less payments, net of refunds, to Director | (984,638 | ) | (984,638 | ) | |||||
Payment of exercise of warrants | (449,150 | ) | (108,788 | ) | |||||
$ | 566,212 | $ | 906,574 |
NOTE_PAYABLE
NOTE PAYABLE | 12 Months Ended |
Dec. 31, 2014 | |
Note Payable | |
NOTE 5 - NOTE PAYABLE | On April 14, 2014, the Company entered into a promissory note with Stephen Frye, former Chief Executive Officer, President, CFO, and Director of the Company, for $13,500. The principle amount due Mr. Frye as of December 31, 2014 was $13,325. These amounts are unsecured and bear interest at the rate of 12% per annum. The note is due and payable December 31, 2015. The accrued interest under the Note as of December 31, 2014 was $1,154. On December 6, 2014, Mr. Frye resigned as Chief Executive Officer, Chief Financial Officer, President, and Director of the Company. |
COMMITMENTS_AND_CONTRACTUAL_OB
COMMITMENTS AND CONTRACTUAL OBLIGATIONS | 12 Months Ended |
Dec. 31, 2014 | |
Commitments And Contractual Obligations | |
NOTE 6 - COMMITMENTS AND CONTRACTUAL OBLIGATIONS | Loans Payable Related Party |
The amounts due to a related party at December 31, 2014 of $139,029, represents an unsecured promissory note (“Myers – LOC”) due to a shareholder and director of the Company. These amounts are unsecured and bear interest at 12% per annum and $18,562 interest is accrued at December 31, 2014. On December 31, 2014, the loan due date was extended to December 31, 2015. | |
Birch First Capital Fund, LLC | |
On August 16, 2013, Birch First Capital Fund, LLC and/or Birch First Capital Management, LLC (“Birch First”) filed a complaint against the Company in the 15th Judicial Circuit of Florida (2013 CA 012838) alleging breach of contract under a Line of Credit Agreement (LOC). At December 31, 2014, the disputed liability including accrued interest under the LOC, was $201,469. The principle balance of the LOC being $151,000 is classified as a line of credit and the related accrued interest at December 31, 2014, of $50,469 is classified in accrued liabilities. On September 5, 2013, the Company filed a response and counterclaim alleging a minimum of $200,000 damages to be accumulated at trial. In response, Birch First amended his original complaint to include breach of contract concerning a 2011 and 2013 Consulting Agreement, alleging $300,000 in unpaid fees. The Company does not recognize the consulting contracts currently under dispute as such agreements were not accounted for nor acknowledged by the former Board of Directors. On November 18, 2013, Birch brought a lawsuit in the 15th Judicial Circuit of Florida against Mr. Charles Cronin and Dr. Earl Beaver, naming the Company as a nominal defendant. A motion to dismiss was filed by the Company concerning this derivative lawsuit. As of the date of this report, both lawsuits are still pending as the Company and Birch engage in settlement negotiations. At this point any amount of settlement is not determinable. | |
EraStar, Inc. Consulting Contract | |
The Company entered into an Investor Relations Consulting Agreement with EraStar Inc. (“EraStar”) for advisement purposes regarding the Company's current and proposed activities relating to, but not limited to, investor communications, public relations with shareholders, brokers, dealers, and other investment professionals. The duties of EraStar include, but are not limited to: advising, consulting and assisting the Company in developing and implementing appropriate plans and means for presenting the Company and its business plans, strategizing and introducing personnel to the financial community, assisting in establishing an image for the Company in the financial community, and assisting in creating the foundation for subsequent financial public relation efforts. As consideration for the services described in the Agreement, the Company has agreed to pay EraStar a one-time retainer of Twenty-Five Thousand Dollars ($25,000) within twenty (20) business days from the signing of the Agreement and Fifteen Thousand ($15,000) per month upon signing of the Agreement. The Company may issue stock in lieu of any cash payment if the Company is unable to fulfill their payment obligation. As consideration for the Agreement, the Company issued EraStar 500,000 shares of the Company’s common stock with Three Hundred Sixty-Nine Thousand Four Hundred and Forty-One (369,411) shares to be payable upon completion of the six month term absent a challenge of performance, and (b) warrant to purchase One Million (1,000,000) shares of Common Stock of the Company at an exercise price of $2.00 per share for a period of one year. Upon mutual consent by both the Company and the EraStar the Agreement will be extended for another six (6) months, and if extended the Company will issue to the EraStar Eight Hundred Sixty Nine Thousand Four Hundred Forty One (869,441) shares of the Company’s Common Stock within ten (10) business days thereafter. | |
Under the terms of the Agreement, the Company has the ability to challenge performance under the contract to an independent referee within certain timelines, which the Company initiated. Both EraStar and the Company have agreed to restructure the Agreement in which the Company intends to do in the upcoming quarter. The Company has issued the required 500,000 shares of Common Stock and has accrued the $40,000 in accrued liabilities, which consists of the $25,000 retainer and $15,000 monthly fee for December 2014. |
CAPITAL_STOCK
CAPITAL STOCK | 12 Months Ended | ||||||||
Dec. 31, 2014 | |||||||||
Capital Stock | |||||||||
NOTE 7 - CAPITAL STOCK | Authorized | ||||||||
The Company is authorized to issue 10,000,000 shares of preferred stock, having a par value of $0.0001 per share, and 50,000,000 shares of common stock, having a par value of $0.0001 per share. | |||||||||
Forward Stock Split and Authorized Capital Stock | |||||||||
Effective September 15, 2011, by Articles of Amendment, the Company effected the following changes: | |||||||||
-1 | forward split all outstanding shares of the Corporation’s common stock on a 3 for 1 basis. Accordingly, common share disclosure has been presented on a post split basis, except where noted. | ||||||||
-2 | increased authorized capital stock to 500,000,000 shares, of which 300,000,000 shares shall be common stock, par value $0.00003, and 200,000,000 shares shall be preferred stock, par value $0.0001, and to give the Board of Directors the power to fix by resolution the rights, preferences and privileges of preferred stock. | ||||||||
On October 5, 2011, by approval of shareholders of the Company and the Florida Secretary of State, the authorized number of Series A Convertible Preferred Stock was changed to 50,000,000 shares from the previously authorized 200,000,000 shares of preferred stock. The Certificate of Designation for these shares provides among other rights and privileges the requirement that 75% of the outstanding Series A Convertible Preferred must give their prior consent, before the Company can elect members to the Board of Directors, issue any securities of the Company or affect any fundamental transaction (defined as acquisitions, mergers, sale or purchase of substantially all assets, etc.). The Company effectuated these amendments during the fourth fiscal quarter of 2011. | |||||||||
The shareholders of convertible preferred stock are voted equally with the shares of the Company’s common stock. Each share of the convertible preferred stock is convertible into two fully paid and non-assessable shares of common stock, subject to certain adjustments, as follows: | |||||||||
i. | During the period commencing on October 10, 2013 and terminating on October 10, 2015 (“the quarterly conversion period”), each holder of convertible preferred stock may elect to convert, on each March 31, June 30, September 30 and December 31 occurring during the quarterly conversion period, that number of shares of convertible preferred stock equal to 25% of the total number of shares of convertible preferred stock initially issued to such Holder into full paid and non-assessable shares of common stock; and | ||||||||
ii. | After the quarterly conversion period, each Holder may elect to convert all or any portion of its shares of convertible preferred stock then outstanding into full paid and non-assessable shares of common stock. | ||||||||
iii. | At any time after the issue date and while the convertible preferred stock are outstanding, the Company sells or grants any option to purchase or otherwise disposes or issues any common stock and/or common stock equivalents entitling any person to acquire shares of common stock at a price per share that is lower than $2.50 (such issuances, collectively, then the Company is required to issue additional shares of preferred shares “Dilutive Issuance”), based on the ratio of the number of shares of common stock and equivalents divided by the number of shares of common stock prior to the dilutive issuance, times the number of shares of preferred stock prior to the dilutive issuance. Each preferred stock shareholder is entitled to receive a pro rate portion of the dilutive issuance based on the number of its shares of preferred stock held prior to the dilutive issuance. | ||||||||
Reverse Stock Split and Change in Authorized Capital Stock | |||||||||
Effective November 4, 2013, the Company received an affirmative vote by the shareholders for a reverse split of all the outstanding shares of the Company at a reverse split ratio of 1:1,300. No fractional shares were issued and cash was paid in lieu of the fractional shares. As a result of the fractional shares, outstanding shares were reduced by 320 post split shares. | |||||||||
Effective January 29, 2014 by Board Resolution (the “Effective Date”) pursuant to the Articles of Amendment to the Company’s Article of Incorporation, the Company adopted the following amendment to the Company’s Articles of Incorporation and affected the following changes: | |||||||||
i. | Decreased authorized capital stock to 60,000,000 shares (originally 500,000,000), of which 50,000,000 shares shall be common stock (originally 300,000,000), par value $0.0001, and 10,000,000 shares shall be preferred stock (originally 200,000,000), par value $0.0001. | ||||||||
Issued and Outstanding | |||||||||
Preferred Stock | |||||||||
At December 31, 2014 and 2013, shares of preferred stock issued and outstanding totaled -0- and -0-, respectively. | |||||||||
During the year ended December 31, 2013, the Company issued 302 shares of preferred stock, at par value of $.0001 per share, for a dilutive issuance under the preferred share agreement to the shareholders of preferred stock. Each preferred stock shareholder is entitled to receive a pro rate portion of the dilutive issuance based on the number of its shares of preferred stock held prior to the dilutive issuance. | |||||||||
On September 30, 2013, the Company entered into a series of repurchasing agreements with each of the shareholders of its Series A Convertible Preferred Stock. The Company entered into the agreement to eliminate future dilutive issuance as a result the Company was able to reduce its convertible share exposure by 33% and eliminate 75% control held by the Series A Preferred Stock. In exchange for the agreement, each of the Series A Preferred Stock holders were issued common stock in the Company based on weighted average conversation rate of 67% of the conversion rate. As a result the Company issued 70,032 shares of common stocks at par value of $.0001 in exchange for the repurchase each of the Series A Preferred Stock. | |||||||||
Common Stock | |||||||||
At December 31, 2014 and 2013, shares of common stock issued and outstanding totaled 19,219,070 and 150,488, respectively. | |||||||||
During the year ended December 31, 2014, the Company issued 19,068,582 shares of common stock as follows: | |||||||||
On January 13, 2014, the Company issued 14,000,000 shares of the Company’s Common Stock in conjunction with its asset purchase agreement to acquire www.classifiedride.com.See further discussion at Note 1 and 4. | |||||||||
On January 15, 2014, the Company issued 765,000 shares of the Company’s Common Stock for 51% of the membership interests of Autoglance, LLC, a Tennessee Limited Liability Company. See discussion at Note 1. | |||||||||
On May 22, 2014, the Board of Directors approved three subscription agreements aggregating $55,000 and authorized issuance of 110,000 shares of common stock pursuant to the terms of the subscription agreements. Cash proceeds of $55,000 were received in November 2013. | |||||||||
On November 19, 2014, the Company issued 250,000 shares of the Company’s Common Stock relating to a consulting contract. The shares were valued at the fair value of services to be rendered at $125,000. | |||||||||
On December 2, 2014, the Company issued 500,000 shares of the Company’s Common Stock relating to a consulting contract. The shares were valued at the fair value of services to be rendered at $250,000. | |||||||||
On December 20, 2014, the Board of Directors approved a subscription agreement for $20,000 and authorized issuance of 40,000 shares of common stock pursuant to the terms of the subscription agreements. Cash proceeds of $20,000 was received in November 2013. | |||||||||
During 2014, the Company entered into four note conversion agreements with Rocky Road Capital, Inc. to convert a total of $340,362 of the note balance, which was due to a former director and subsequently assigned to Rocky Road Capital, Inc., into 3,403,620 shares of Common Stock at $0.10 per share, as partial payment on the note, thereby reducing the balance owed to $566,212. The Company recognized a loss of $1,361,448 on extinguishment of the debt as a result of the transactions. | |||||||||
During the year ended December 31, 2013, the Company issued 87,340 shares of common stock as follows: | |||||||||
On September 30, 2013, in conjunction with the repurchase agreements with the holders of the Series A Convertible Preferred Stock, Mr. Cronin exercised his warrants and those of TMDS at their strike price and 17,308 shares of common stock were issued for $298,300. The purchase price offset amounts due him under his line of credit and amount due under the contingent liability amount from the Company. | |||||||||
On September 30, 2013, the Company issued 70,032 shares of common stock under the repurchase agreements in exchange all of the outstanding Series A Convertible Preferred Stock. | |||||||||
In September 2013, the Company entered into subscription agreements with Cape Mackinnon, Inc. and EV Tech LLC in exchange for $80,000. The Company agreed to settle this sum, either with common stock at $0.50 per share by September 2014 or repay the sum of $80,000 plus interest at an annual rate of 8%. As of December 31, 2014 the Company had not issued common stock for this subscription and reclassified the full sum to current liabilities. The Company also has accrued interest of $8,222 as of December 31, 2014 related to these agreements. | |||||||||
Stock Purchase Warrants | |||||||||
As of December 31, 2014 and 2013 were 1,002,307 and 1,538 warrants outstanding, respectively. | |||||||||
On December 3, 2014, pursuant to the terms of a one year consulting contract, the Company issued a warrant for the purchase of 1,000,000 shares of common stock with a strike price of $2.00, exercisable immediately through December 1, 2015. Using the Black-Scholes option pricing model, the fair market value of the warrants at the time of issuance was determined to be $522,684. The warrants were valued using the following significant assumptions: (1) a risk free interest rate of 0.14%, (2) expected life of 1.0 year, (3) expected stock price volatility of 92.083% and (4) expected dividend yield of zero. The amount will expensed over the life of the contract and $41,528 was expensed as stock compensation during the year ended December 31, 2014, and $481,156 remains to be expensed over the remaining life of the contract. | |||||||||
On January 2, 2014, the Company issued a warrant for the purchase of 769 shares of common stock to an independent contractor (“Contractor”), per a January 1, 2012 four year Stock Purchase Warrant Agreement that gives the Contractor the right to purchase 769 shares of common stock at an exercise price of $390.00 a share, as consideration for services rendered per an Independent Contractor Agreement with the Company. Based on the January 2, 2012, Stock Purchase Warrant, the warrant will expire on January 1, 2016. The fair value of the issued warrant is $-0-, based on Black-Scholes option-pricing model using risk free interest rate of 0.389%, expected life of 2 years and expected volatility of 0.00%. | |||||||||
During the year ended December 31, 2013, the Company issued a total of four warrants for the purchase of 3,077 shares of common stock with a total value of $140,000. The following discusses the issuance of warrants during 2013: | |||||||||
On January 1, 2013, the Company incurred a warrant share issuance for the purchase of 769 Shares of common stock by an independent contractor , per a January 1, 2012 Stock Purchase Warrant Agreement that gives the Contractor the right to purchase 769 shares of common stock, at an exercise price of $260.00 per share. Based on the January 2, 2012, Stock Purchase Warrant, the warrant will expire on January 1, 2016. The fair value of the issued warrant is $60,000, based on Black-Scholes option-pricing model using risk free interest rate of 0.72%, expected life of 4 years and expected volatility of 534.55%. | |||||||||
On January 11, 2013, the Company issued a warrant for the purchase of 769 shares of common stock to TMDS. As discussed above, TMDS receives a warrant to purchase 769 shares of common stock every ninety days during the term of the Contractor Agreement for a total of five (5) years. The fair value of the issued warrant is $50,000, based on Black-Scholes option-pricing model using risk free interest rate of 0.80%, expected life of 4 years and expected volatility of 529.81%. | |||||||||
On April 11, 2013, the Company issued a warrant for the purchase of 769 shares of common stock to TMDS. As discussed above, TMDS receives a warrant to purchase 769 shares of common stock every ninety days during the term of the Contractor Agreement for a total of five (5) years. The fair value of the issued warrant is $20,000, based on Black-Scholes option-pricing model using risk free interest rate of 0.74%, expected life of 4 years and expected volatility of 429.77%. On July 15, 2013, the Company issued a warrant for the purchase of 769 shares of common stock to TMDS. As discussed above, TMDS receives a warrant to purchase 769 shares of common stock every ninety days during the term of the Contractor Agreement for a total of five (5) years. The fair value of the issued warrant is $10,000, based on Black-Scholes option-pricing model using risk free interest rate of 0.34%, expected life of 2 years and expected volatility of 420.04%. On September 30, 2013, in conjunction with the repurchase agreements with the holders of the Series A Convertible Preferred Stock, Mr. Cronin exercised his warrants and those of TMDS at their strike price and 17,308 shares of common stock were issued for $298,800. The purchase price offset amounts due him under his line of credit and amount due under the contingent liability amount from the Company. | |||||||||
The following table summarizes the warrant activity for the years ended December 31, 2014 and 2013: | |||||||||
Warrants Outstanding | |||||||||
Weighted | |||||||||
Average | |||||||||
Number of | Exercise | ||||||||
Shares | Price | ||||||||
Balance, December 31, 2012 | 15,769 | $ | 25.27 | ||||||
Granted | 3,077 | $ | 65.1 | ||||||
Exercised | (17,308 | ) | $ | (17.26 | ) | ||||
Expired/Cancelled | — | — | |||||||
Balance, December 31, 2013 | 1,538 | $ | 195 | ||||||
Granted | 1,000,769 | $ | 2.29 | ||||||
Exercised | — | — | |||||||
Expired/Cancelled | — | — | |||||||
Balance, December 31, 2014 | 1,002,307 | $ | 259 | ||||||
Exercisable at December 31, 2014 | 1,002,307 | $ | 259 | ||||||
The range of exercise prices and the weighted average exercise price and remaining weighted average life of the warrants outstanding at December 31, 2014 were $2.00 to 390.00, $2.59 and .918 years, respectively. The aggregate intrinsic value of the outstanding warrants at December 31, 2014 was $-0-. |
INCOME_TAXES
INCOME TAXES | 12 Months Ended | ||||||||
Dec. 31, 2014 | |||||||||
Income Taxes | |||||||||
NOTE 8 - INCOME TAXES | Potential benefits of income tax losses and other tax assets are not recognized in the accounts until realization is more likely than not. As of December 31, 2014 and 2013, the Company has net operating losses carryforwards of approximately $3,966,516 and $1,609,051, respectively, for tax purposes in various jurisdictions subject to expiration as described below. Pursuant to ASC 740, Income Taxes, the Company is required to compute tax asset benefits for net operating losses carried forward and other items giving rise to deferred tax assets. Future tax benefits which may arise as a result of these losses and other items have not been recognized in these financial statements, as their realization is determined not likely to occur and accordingly, the Company has recorded a valuation allowance for the deferred tax asset relating to these items. | ||||||||
The actual income tax provisions differ from the expected amounts calculated by applying the combined income tax statutory rates applicable in each jurisdiction to the Company’s loss before income taxes and non-controlling interest. The components of these differences are as follows: | |||||||||
For the Years Ended | |||||||||
December 31, | |||||||||
2014 | 2013 | ||||||||
Corporate income tax rate | 35 | % | 35 | % | |||||
Expected income tax (recovery) | $ | (825,113 | ) | $ | (165,632 | ) | |||
Non-deductible finance costs and other | 14,535 | 47,600 | |||||||
Change in valuation allowance | 810,578 | 118,032 | |||||||
Income tax (benefit) provision | $ | - | $ | - | |||||
The Company’s tax-effected deferred income tax asset is estimated as follows: | |||||||||
As of December 31, | |||||||||
2014 | 2013 | ||||||||
Net operating loss carryforward | $ | 1,357,655 | 547,077 | ||||||
Total deferred tax asset | 1,357,655 | 547,077 | |||||||
Less: Valuation allowance | (1,357,655 | ) | (547,077 | ) | |||||
Net deferred tax asset after valuation allowance | $ | - | $ | - | |||||
The Company has approximately $ 3,966,516 in net operating losses carried forward for United States income tax purposes which will expire, if not utilized in various amounts through 2034. |
SUBSEQUENT_EVENTS
SUBSEQUENT EVENTS | 12 Months Ended |
Dec. 31, 2014 | |
Subsequent Events | |
NOTE 9 - SUBSEQUENT EVENTS | On January 8, 2015, the Company entered into a subscription agreement with shareholder for $25,000 issuing 25,000 shares at $1.00 per share. |
On February 4, 2015, the Company entered into a note conversion agreement with Rocky Road Capital, Inc. to convert $94,200 of the principal balance, which was due to a former director and subsequently assigned to Rocky Road Capital, Inc., into 942,000 shares of Common Stock (at $0.10 per share), thereby reducing the balance owed under the note to $472,012. On February 20, 2015, the Company entered into a note conversion agreement with Rocky Road Capital Inc. to convert $150,000 of the principal balance, which was due to a former director and subsequently assigned to Rocky Road capital, Inc., into 1,500,000 shares of Common Stock (at $.10 per share), thereby reducing the balance owed under the note to $322,012. | |
On March 16, 2015, the Company entered into a Note Purchase Agreement for a Convertible Debenture Promissory Note (hereafter “Note”) in the amount of $120,000 (net $100,000 after Original Issuance Discount and Fees) with Iconic Holdings, LLC (hereafter “Iconic”). Pursuant to the Note, the Company may repay the Note at any time on or before 180 days from March 16, 2015 pursuant to the prepayment schedule: Between 1 and 30 days from the date of execution, the Note may be prepaid for 107.5% of face value. Between 31 and 60 days from the date of execution, the Note may be prepaid for 115% of face value. Between 61 and 90 days from the date of execution, the Note may be prepaid for 120% of face value. Between 91 and 120 days from the date of execution, the Note may be prepaid for 125% of face value. Between 121 and 180 days from the date of execution, the Note may be prepaid for 130% of face value. After 180 days from the date of execution until the Due Date, the Note may not be prepaid without written consent from Iconic. If the Company repays a payment of consideration on or before 180 days from the Effective Date of that payment, the interest rate on that payment of consideration shall be zero percent (0%). If the Company does not repay a payment of consideration on or before the Maturity Date, a one-time interest charge of 10% shall be applied to the Principal Sum. Both the principal and interest shall be deemed earned as of the date of payment of consideration by the Holder as of the Maturity Date, to the extent such principal amount and interest have been repaid or converted into the Company's Common Stock, $0.0001 par value per share, equal to 60% of the lowest trading price of the Company’s common stock during the 20 consecutive trading days prior to the date on which Iconic elects to convert all or part of the Note. | |
On March 22, 2014, Steven Frye signed an addendum to the Promissory Note with the principal balance of $13,500 extending the maturity date from April 15, 2015 to December 31, 2015. | |
On April 6, 2015, the Company entered into a Securities Purchase Agreement and Promissory Note with H y H to acquire all of the capital stock of El Mar Muerto Beauty Mineral, Sociedad Anonima (hereafter “EMBM”) a Honduras corporation, whose sole assets consist of a license to operate gaming machines in the following distributions: eighty (80) slot machines in the county of La Lima, Cortes; eighty (80) slot machines in the county of Trujillo, Colon; and One Hundred and Sixty (160) slot machines in Roatan for a total sum of Ten Million Dollars ($10,000,000) payable as follows: 1) One Hundred Thousand Dollars ($100,000) as a non-refundable payment payable in cash within 10 business days (the “Initial Payment”); Nine Hundred Thousand Dollars ($900,000) payable on or before April 6, 2016 in the form of cash or shares of common stock of the Company at H y H’s option, at the average closing price of the common stock of the Company for the five trading days immediately preceding April 6, 2016; 3) Nine Million Dollars ($9,000,0000) payable up to Two Million Five Hundred Thousand Dollars ($2,500,000) per year thereafter through March 31, 2021 by either cash payments or out of the revenues received EMBM during this time, at an amount equal to Twenty Five (25%) percent of the net revenues of EMBM during such time period. In the event that H y H has not received the full amount due on or before March 31, 2021, such amount due may be payable, at H y H’s option, via the issuance of shares of common stock of the Company, at the average closing price of the common stock of the Company for the five trading days immediately preceding March 31, 2021. At H y H’s option beginning on or after April 17, 2017, payments tendered in the Company’s common stock may be repurchased by the Company. As conditions to purchase, H y H will be permitted to receive a license granting it the usage of twenty-five (25) machines in the municipality of Roatan and be permitted to have online gaming distribution rights once and if the appropriate approvals have been granted. So long as the Company fulfills the conditions to purchase, H y H shall waive applicable interest payments of 3.85% per annum due and payable in monthly installments. |
SUMMARY_OF_SIGNIFICANT_ACCOUNT1
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Policies) | 12 Months Ended | ||
Dec. 31, 2014 | |||
Summary Of Significant Accounting Policies Policies | |||
Basis Of Presentation | The consolidated financial statements have been prepared in accordance with generally accepted accounting principles and include the accounts of the Company and its subsidiaries, Dynamic Energy Development Corporation and Transformation Consulting, Inc.. All intercompany balances and transactions have been eliminated. | ||
Reclassifications | Certain reclassifications have been made in Statement of Operations during the year ended December 31, 2014. These reclassifications impacted the classification of certain items within the Statement of Operations: relating to classification of consulting expenses and project development costs. The reclassifications had no impact on previously reported total operating expenses, net loss, or stockholders' equity. | ||
Valuation of Intangible Assets and Note Payable to Related Party | The Company’s intangible asset value and note balance to a related party were reduced to the appropriate carrying value of $587,564 as of June 30, 2014. An impairment loss of $589,041 has been charged to intangible assets since the fair value is less than the carrying amount as of the year end. As of December 31 2014, the intangible assets carrying value is $0. | ||
Development Costs | Development costs are expensed in the period they are incurred unless they meet specific criteria related to technical, market and financial feasibility, as determined by management, including but not limited to the establishment of a clearly defined future market for the product, and the availability of adequate resources to complete the project. If all criteria are met, the costs are deferred and amortized over the expected useful life, or written off if a product is abandoned. For the years ended December 31, 2014 and 2013, total development costs amounted to $29,139 and $21,999, respectively. At December 31, 2014 and 2013, the Company had no deferred product development costs. | ||
Cash | Cash and cash equivalents, if any, include all highly liquid instruments with an original maturity of three months or less at the date of purchase. At December 31, 2014 and 2013, the Company had no cash equivalents. | ||
Financial Instruments and Concentration of Risk | The fair values of financial instruments, which include cash, accounts payable and accrued liabilities and convertible notes, were estimated to approximate their carrying values due to the immediate or relatively short maturity of these instruments. Management does not believe that the Company is subject to significant interest, currency or credit risks arising from these financial instruments. | ||
Impairment of Long-Lived Intangible Assets | We review our long-lived assets, including intangible assets subject to amortization, for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. When such factors and circumstances exist, we compare the projected undiscounted future cash flows associated with the future use and disposal of the related assets or group of assets to their respective carrying amounts. Impairment, if any, is measured as the excess of the carrying amount over the fair value based on market value (when available) or discounted expected cash flows of those assets, and is recorded in the period in which the determination is made. Intangible assets not subject to amortization are tested annually for impairment and more frequently if events or changes in circumstances indicate that it is more likely than not that the asset is impaired. These tests were performed for the year ended December 31, 2014 and an impairment loss of $589,041 has been charged to intangible assets since the fair value is less than the carrying amount as of the year end. | ||
Fair Value of Financial Instruments | The Company accounts for the fair value of financial instruments in accordance with the FASB ASC Topic 820, Fair Value Measurements and Disclosures ("Topic 820"). Topic 820 defines fair value, establishes a three-level valuation hierarchy for disclosures of fair value measurement and enhances disclosure requirements for fair value measures. | ||
The three levels are defined as follows: | |||
Level 1 | inputs to the valuation methodology are quoted prices (unadjusted) for identical assets or liabilities in active markets. | ||
Level 2 | inputs to the valuation methodology include quoted prices for similar assets and liabilities in active markets, and inputs that are observable for the asset or liability, either directly or indirectly, for substantially the full term of the financial instrument. | ||
Level 3 | inpuinputs to the valuation methodology are unobservable and significant to the fair measurement. | ||
The fair value of the Company's cash, accounts payable, and accrued expenses approximate carrying value because of the short-term nature of these items. | |||
Management believes it is not practical to estimate the fair value of loan to related parties because the transactions cannot be assumed at arm's length, the terms are not deemed to be market terms, there are no quoted values available for these instruments, and an independent valuation would not be practical due to the lack of data regarding similar instruments, if any, and the associated potential costs. | |||
Revenue Recognition | The Company recognizes revenue in accordance with the FASB ASC Section 605-10-S99, Revenue Recognition, Overall, SEC Materials ("Section 605-10-S99"). Section 605-10-S99 requires that four basic criteria must be met before revenue can be recognized: (1) persuasive evidence of an arrangement exists; (2) delivery has occurred or services rendered; (3) the fee is fixed and determinable; and (4) collectability is reasonably assured. | ||
Loss Per Common Share | Basic loss per common share (“EPS”) is calculated by dividing the net loss available to common shareholders by the weighted average number of common shares outstanding for the period. Diluted EPS reflects the potential dilution that could occur if securities or other contracts to issue common stock were exercised or converted into common stock. The number of common shares that are exercisable or converted into common stock is not material to effect diluted EPS results. Further, since the Company shows losses for the periods presented basic and diluted loss per share are the same for all periods presented. As of December 31, 2014 and 2013, there were no outstanding dilutive securities. | ||
Income Taxes | Potential benefits of income tax losses are not recognized in the accounts until realization is more likely than not. The Company has adopted the accounting standards codified in ASC 740, Income Taxes as of its inception. Pursuant to those standards, the Company is required to compute tax asset benefits for net operating losses carried forward. Potential benefit of net operating losses have not been recognized in these financial statements because the Company cannot be assured it is more likely than not that it will utilize the net operating losses carried forward in future years. | ||
ASC 740-10-25 prescribes recognition thresholds that must be met before a tax position is recognized in the financial statements and provides guidance on de-recognition, classification, interest and penalties, accounting in interim periods, disclosure, and transition. An entity may only recognize or continue to recognize tax positions that meet a "more likely than not" threshold. Based on its evaluation, the Company has concluded that there are no significant uncertain tax positions requiring recognition in its financial statements. | |||
The Company does not have any unrecognized tax benefits as of December 31, 2014 and 2013 that, if recognized, would affect the Company's effective income tax rate. The Company's policy is to recognize interest and penalties related to income tax issues as components of income tax expense. The Company did not recognize or have any accrual for interest and penalties relating to income taxes as of December 31, 2014 and 2013. | |||
Common Share Non-Monetary Consideration | In situations where common shares are issued and the fair value of the goods or services received is not readily determinable, the fair value of the common shares is used to measure and record the transaction. The fair value of the common shares issued in exchange for the receipt of goods and services is based on the stock price as of the earliest of the date at which: | ||
i. | the counterparty’s performance is complete; | ||
ii. | commitment for performance by the counterparty to earn the common shares is reached; or | ||
iii. | the common shares are issued if they are fully vested and non-forfeitable at that date. | ||
Stock-Based Compensation | On December 1, 2005, the Company adopted the fair value recognition provisions codified in ASC 718, Compensation-Stock Compensation. The Company adopted those provisions using the modified-prospective-transition method. Under this method, compensation cost recognized for all periods prior to December 1, 2005 includes: a) compensation cost for all share-based payments granted prior to, but not yet vested as of November 30, 2005, based on the grant-date fair value and b) compensation cost for all share-based payments granted subsequent to November 30, 2005, based on the grant-date fair value. In addition, deferred stock compensation related to non-vested options is required to be eliminated against additional paid-in capital. The results for periods prior to December 1, 2005 were not restated. | ||
The Company accounts for equity instruments issued in exchange for the receipt of goods or services from parties other than employees in accordance with ASC 505, Equity. Costs are measured at the estimated fair market value of the consideration received or the estimated fair value of the equity instruments issued, whichever is more reliably measurable. The value of equity instruments issued for consideration other than employee services is determined on the earliest of a performance commitment or completion of performance by the counterparty. | |||
Share Purchase Warrants | The Company accounts for common share purchase warrants at fair value in accordance with ASC 815, Derivatives and Hedging. The Black-Scholes option pricing valuation method is used to determine fair value of these warrants. Use of this method requires that the Company make assumptions regarding stock volatility, dividend yields, expected term of the warrants and risk-free interest rates. | ||
Recently and Issued Accounting Pronouncements | In May 2014, the FASB issued ASU 2014-09, “Revenue from Contracts with Customers.” ASU 2014-09 requires an entity to recognize the amount of revenue to which it expects to be entitled for transfer of promised goods or services to customers. ASU-2014-09 will replace most existing revenue recognition guidance in U.S. GAAP when it becomes effective. The amendments in this update also require disclosure of sufficient information to allow users to understand the nature, amount, timing and uncertainty of revenue and cash flow arising from contracts. ASU-2014-09 is effective for annual and interim reporting periods beginning after December 15, 2016, using one of two retrospective application methods. Early application is not permitted. The Company is currently evaluating the effect that the adoption of ASU 2014-09 will have on the Company’s consolidated financial statements. | ||
In August 2014, the FASB issued ASU No. 2014-15, “Disclosure of Uncertainties about an Entity’s Ability to Continue as a Going Concern” (Subtopic 205-40), which defines management's responsibility to evaluate whether there are conditions or events that raise substantial doubt about the entity’s ability to continue as a going concern and to provide related disclosures. Currently, this evaluation has only been an auditor requirement. Specifically, the amendments (1) provide a definition of the term “substantial doubt,” (2) require an evaluation every reporting period, (3) provide principles for considering the mitigating effect of management’s plans, (4) require certain disclosures when substantial doubt is alleviated as a result of the consideration of management’s plans, (5) require an express statement and other disclosures when substantial doubt is not alleviated, and (6) require an assessment for a period of one year after the date that financial statements are issued. This amended guidance will be effective for us beginning January 1, 2016. The Company does not expect the adoption of this amended guidance to have a significant impact on its Consolidated Financial Statements. | |||
Other recent accounting pronouncements issued by the FASB (including its Emerging Issues Task Force), the AICPA, and the SEC during the current reporting period did not, or are not, believed by management to have a material impact on the Company’s present or future consolidated financial statements. |
DESCRIPTION_OF_BUSINESS_Tables
DESCRIPTION OF BUSINESS (Tables) | 12 Months Ended | ||||
Dec. 31, 2014 | |||||
Description Of Business Tables | |||||
Common stock issued pursuant to the repurchase | Name | Shares of | |||
Common Stock | |||||
Charles R. Cronin Jr. | 54,953,990 | ||||
James Michael Whitfield | 15,094,386 | ||||
Harvey Dale Cheek | 17,725,860 | ||||
Dr. Earl Beaver | 3,267,876 | ||||
TOTAL | 91,042,112 |
RELATED_PARTY_TRANSACTIONS_AND1
RELATED PARTY TRANSACTIONS AND AMOUNTS OWING (Tables) | 12 Months Ended | ||||||||
Dec. 31, 2014 | |||||||||
Related Party Transactions And Amounts Owing Tables | |||||||||
Contingent Consideration to Director | At December 31, 2014 and 2013, the contingent consideration payable is as follows: | ||||||||
As of | As of | ||||||||
December 31, | December 31, | ||||||||
2014 | 2013 | ||||||||
Contingent consideration due | $ | 2,000,000 | $ | 2,000,000 | |||||
Less payments, net of refunds, to Director | (984,638 | ) | (984,638 | ) | |||||
Payment of exercise of warrants | (449,150 | ) | (108,788 | ) | |||||
$ | 566,212 | $ | 906,574 |
CAPITAL_STOCK_Tables
CAPITAL STOCK (Tables) | 12 Months Ended | ||||||||
Dec. 31, 2014 | |||||||||
Capital Stock Tables | |||||||||
Warrants Outstanding | The following table summarizes the warrant activity for the years ended December 31, 2014 and 2013: | ||||||||
Warrants Outstanding | |||||||||
Weighted | |||||||||
Average | |||||||||
Number of | Exercise | ||||||||
Shares | Price | ||||||||
Balance, December 31, 2012 | 15,769 | $ | 25.27 | ||||||
Granted | 3,077 | $ | 65.1 | ||||||
Exercised | (17,308 | ) | $ | (17.26 | ) | ||||
Expired/Cancelled | — | — | |||||||
Balance, December 31, 2013 | 1,538 | $ | 195 | ||||||
Granted | 1,000,769 | $ | 2.29 | ||||||
Exercised | — | — | |||||||
Expired/Cancelled | — | — | |||||||
Balance, December 31, 2014 | 1,002,307 | $ | 259 | ||||||
Exercisable at December 31, 2014 | 1,002,307 | $ | 259 |
INCOME_TAXES_Tables
INCOME TAXES (Tables) | 12 Months Ended | ||||||||
Dec. 31, 2014 | |||||||||
Income Taxes Tables | |||||||||
Expected Amount of Income tax Statuary | The components of these differences are as follows: | ||||||||
For the Years Ended | |||||||||
December 31, | |||||||||
2014 | 2013 | ||||||||
Corporate income tax rate | 35 | % | 35 | % | |||||
Expected income tax (recovery) | $ | (825,113 | ) | $ | (165,632 | ) | |||
Non-deductible finance costs and other | 14,535 | 47,600 | |||||||
Change in valuation allowance | 810,578 | 118,032 | |||||||
Income tax (benefit) provision | $ | - | $ | - | |||||
Deferred Income Tax Assets And Liability | The Company’s tax-effected deferred income tax asset is estimated as follows: | ||||||||
As of December 31, | |||||||||
2014 | 2013 | ||||||||
Net operating loss carryforward | $ | 1,357,655 | 547,077 | ||||||
Total deferred tax asset | 1,357,655 | 547,077 | |||||||
Less: Valuation allowance | (1,357,655 | ) | (547,077 | ) | |||||
Net deferred tax asset after valuation allowance | $ | - | $ | - |
DESCRIPTION_OF_BUSINESS_Detail
DESCRIPTION OF BUSINESS (Details) (USD $) | Dec. 31, 2014 |
Shares of Common Stock | $91,042,112 |
Charles R. Cronin Jr. [Member] | |
Shares of Common Stock | 54,953,990 |
James Michael Whitfield [Member] | |
Shares of Common Stock | 15,094,386 |
Harvey Dale Cheek [Member] | |
Shares of Common Stock | 17,725,860 |
Dr. Earl Beaver [Member] | |
Shares of Common Stock | $3,267,876 |
DESCRIPTION_OF_BUSINESS_Detail1
DESCRIPTION OF BUSINESS (Details Narrative) (USD $) | Dec. 31, 2014 | Dec. 31, 2013 |
Description Of Business Details Narrative | ||
Contingent consideration payable | $566,212 | $906,574 |
GOING_CONCERN_Details_Narrativ
GOING CONCERN (Details Narrative) (USD $) | 12 Months Ended | 397 Months Ended | |
Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2014 | |
Going Concern Details Narrative | |||
Cumulative net loss | ($2,357,465) | ($472,154) | $8,825,176 |
SUMMARY_OF_SIGNIFICANT_ACCOUNT2
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Details Narrative) (USD $) | 12 Months Ended | |
Dec. 31, 2014 | Dec. 31, 2013 | |
Summary Of Significant Accounting Policies Details Narrative | ||
Impairment loss | $589,041 | |
Intangible assets carrying value | 0 | |
Development Costs | 29,139 | 21,999 |
Deferred product development costs | $0 | $0 |
RELATED_PARTY_TRANSACTIONS_AND2
RELATED PARTY TRANSACTIONS AND AMOUNTS OWING (Details) (USD $) | Dec. 31, 2014 | Dec. 31, 2013 |
Related Party Transactions And Amounts Owing Details | ||
Contingency consideration due | $2,000,000 | $2,000,000 |
Less: payments, net of refunds, to Director | -984,638 | -984,638 |
Payment of exercise of warrants | -449,150 | -108,788 |
Contingency consideration payable, net | $566,212 | $906,574 |
RELATED_PARTY_TRANSACTIONS_AND3
RELATED PARTY TRANSACTIONS AND AMOUNTS OWING (Details Narrative) (USD $) | 12 Months Ended | |
Dec. 31, 2014 | Dec. 31, 2013 | |
Related Party Transactions And Amounts Owing Details Narrative | ||
Amounts due to a related party for Myers - LOC | $139,029 | $37,424 |
Accrued interest under the Myers | 18,562 | 3,924 |
Accrued interest | 44,203 | |
Note balance | 587,487 | |
TC Stock Purchase Agreement | 984,638 | |
Gross revenues | $0 |
NOTE_PAYABLE_Details_Narrative
NOTE PAYABLE (Details Narrative) (USD $) | Dec. 31, 2014 | Dec. 31, 2013 |
Note Payable Details Narrative | ||
Loan payable | $13,325 | |
Accrued interest | $1,154 |
COMMITMENTS_AND_CONTRACTUAL_OB1
COMMITMENTS AND CONTRACTUAL OBLIGATIONS (Details Narrative) (USD $) | 12 Months Ended | |
Dec. 31, 2014 | Dec. 31, 2013 | |
Commitments And Contractual Obligations Details Narrative | ||
Amounts due to a related party | $139,029 | $37,424 |
Interest rate | 12.00% | |
Loans Payable Related Party | 18,562 | |
Loan due date | 31-Dec-15 | |
Line of credit payable | 151,000 | 151,000 |
Related party accrued interest | 50,469 | |
Disputed liability | $201,469 |
CAPITAL_STOCK_Details
CAPITAL STOCK (Details) (Warrant [Member], USD $) | 12 Months Ended | |
Dec. 31, 2014 | Dec. 31, 2013 | |
Warrant [Member] | ||
Number of warrants shares, Beginning | 1,538 | 15,769 |
Granted warrants | 1,000,769 | 3,077 |
Exercised warrants | -17,308 | |
Number of warrants shares, Ending | 1,002,307 | 1,538 |
Exercisable warrants | 1,002,307 | |
Weighted Average Exercise Price warrants, Beginning | 195 | 25.27 |
Weighted Average Exercise Price warrants, Granted | 2.29 | 65.1 |
Weighted Average Exercise Price warrants, Exercised | -17.26 | |
Weighted Average Exercise Price warrants, Ending | 259 | 195 |
Weighted Average Exercise Price warrants, Exercisable | $259 |
CAPITAL_STOCK_Details_Narrativ
CAPITAL STOCK (Details Narrative) (USD $) | 12 Months Ended | |
Dec. 31, 2014 | Dec. 31, 2013 | |
Capital Stock Details Narrative | ||
Preferred stock issued | 0 | 0 |
Preferred stock Outstanding | 0 | 0 |
Company share issued | 302 | |
preferred stock, at par value | $0.00 | $0.00 |
Common stock issued | 19,219,070 | 150,488 |
Common stock Outstanding | 19,219,070 | 150,488 |
Common stock share issued | 19,068,582 | 87,340 |
Accrued interest | $8,222 | |
Stock Purchase Warrants outstanding | 1,002,307 | 1,538 |
Stock compensation | 41,528 | |
Future warrants purchase | 481,156 | |
Stock Purchase Warrant Expire | 1-Jan-16 | |
Purchase of common stock fair value | 140,000 | 570,000 |
Purchase of common stock fair value, Shares | 3,077 | 4,231 |
Range of exercise prices, Minimum | $2 | |
Range of exercise prices, Maximum | $390 | |
Weighted average exercise price | $2.59 | |
Weighted average life of the warrants outstanding | 11 months | |
Aggregate intrinsic value of the outstanding | $0 |
INCOME_TAXES_Details
INCOME TAXES (Details) (USD $) | 12 Months Ended | |
Dec. 31, 2014 | Dec. 31, 2013 | |
Income Taxes Details | ||
Corporate income tax rate | 35.00% | 35.00% |
Expected income tax (recovery) | ($825,113) | ($165,632) |
Non-deductible finance costs and other | 14,535 | 47,600 |
Change in valuation allowance | 810,578 | 118,032 |
Income tax (benefit) provision |
INCOME_TAXES_Details_1
INCOME TAXES (Details 1) (USD $) | Dec. 31, 2014 | Dec. 31, 2013 |
Income Taxes Details 1 | ||
Net operating loss carryforward | $1,357,655 | $547,077 |
Total deferred tax assets | 1,357,655 | 547,077 |
Less: Valuation allowance | -1,357,655 | -547,077 |
Net deferred tax asset after valuation allowance |
INCOME_TAXES_Details_Narrative
INCOME TAXES (Details Narrative) (USD $) | 12 Months Ended | |
Dec. 31, 2014 | Dec. 31, 2013 | |
Income Taxes Details Narrative | ||
Net operating losses carried forward | $3,966,516 | $1,609,051 |
Expiration date | 2034 |