Document and Entity Information
Document and Entity Information - shares | 9 Months Ended | |
Sep. 30, 2016 | Nov. 17, 2016 | |
Document And Entity Information | ||
Entity Registrant Name | EnergyTEK Corp. | |
Entity Central Index Key | 748,268 | |
Document Type | 10-Q | |
Document Period End Date | Sep. 30, 2016 | |
Amendment Flag | false | |
Current Fiscal Year End Date | --12-31 | |
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 Common Stock, Shares Outstanding | 431,333,964 | |
Document Fiscal Period Focus | Q3 | |
Document Fiscal Year Focus | 2,016 |
CONDENSED CONSOLIDATED BALANCE
CONDENSED CONSOLIDATED BALANCE SHEETS (Unaudited) - Balance Sheets - USD ($) | Sep. 30, 2016 | Dec. 31, 2015 | |
Current Assets: | |||
Cash | $ 774,363 | $ 3,165 | |
Escrow fund | 214,750 | ||
Deferred contract software development costs - related party | 55,938 | ||
Prepaid expenses and other current assets | 10,971 | 3,000 | |
Total current assets | 1,000,084 | 62,103 | |
Other Assets: | |||
Goodwill | 6,160,229 | ||
Property and equipment, net | 41,887 | 42,297 | |
Deposit | 44,876 | ||
Total Assets | 7,247,076 | 104,400 | |
Current Liabilities: | |||
Accounts payable and accrued expenses | 35,829 | 2,617 | |
Notes payable - related party | 174,058 | ||
Unearned revenue - related party | 156,000 | ||
Loans from officer | 161,800 | ||
Total current liabilities | 209,887 | 320,417 | |
Long Term Liabilities: | |||
Convertible notes payable | 25,000 | ||
Accrued interest | 1,593 | ||
Derivative liability | 1,103,276 | ||
Total long term liabilities | 1,103,276 | 26,593 | |
Total liabilities | 1,313,163 | 347,010 | |
Commitments and Contingencies | |||
Mezzanine Equity | |||
Preferred Series A stock, par value $.01 per share, 134,000 shares authorized; 133,334 and 0 shares issued and outstanding at September 30, 2016 and December 31, 2015, respectively . Stated at redemption value net of discount. | 396,728 | ||
Shareholders' Equity/(Deficit): | |||
Preferred Stock, par value $.01, 10,000,000 shares authorized all series | [1] | 212 | |
Common stock, par value $.001 per share, 500,000,000 shares authorized; 430,087,964 and 414,000,000 shares issued and outstanding at September 30, 2016 and December 31, 2015, respectively | 430,088 | 414,000 | |
Additional paid-in capital | 6,372,596 | (164,000) | |
Accumulated deficit | (1,265,711) | (492,610) | |
Total shareholders' equity/(deficit) | 5,537,185 | (242,610) | |
Total Liabilities and Shareholders' Equity/(Deficit) | $ 7,247,076 | $ 104,400 | |
[1] | Preferred Series A-1 stock, par value $.01 per share, 21,000 shares authorized; 20,371 and 0 shares issued and outstanding at September 30, 2016 and December 31, 2015, respectively; Preferred Series B stock, par value $.01 per share, 300,000 shares authorized; no shares issued and outstanding at September 30, 2016 and December 31, 2015, respectively; Series C stock, par value $.01 per share, 753 and 0 shares issued and outstanding at September 30, 2016 and December 31, 2015, respectively |
CONDENSED CONSOLIDATED BALANCE3
CONDENSED CONSOLIDATED BALANCE SHEETS (Parenthetical) - $ / shares | Sep. 30, 2016 | Dec. 31, 2015 |
Preferred Series A stock | ||
Preferred stock, shares authorized | 134,000 | 134,000 |
Preferred stock, shares issued | 133,334 | |
Preferred stock, shares outstanding | 133,334 | |
Preferred Series A-1 stock | ||
Preferred stock, shares authorized | 21,000 | 21,000 |
Preferred stock, shares issued | 20,371 | |
Preferred stock, shares outstanding | 20,371 | |
Preferred Series B stock | ||
Preferred stock, shares authorized | 300,000 | 300,000 |
Preferred stock, shares issued | ||
Preferred stock, shares outstanding | ||
Series C stock | ||
Preferred stock, shares issued | 753 | |
Preferred stock, shares outstanding | 753 | |
Balance Sheets | ||
Preferred stock, par value | $ 0.01 | $ 0.01 |
Preferred stock, shares authorized | 10,000,000 | 10,000,000 |
Preferred stock, shares issued | 21,124 | |
Preferred stock, shares outstanding | 21,124 | |
Common stock, par value | $ 0.001 | $ 0.001 |
Common stock, shares authorized | 500,000,000 | 500,000,000 |
Common stock, shares issued | 430,087,964 | 414,000,000 |
Common stock, shares outstanding | 430,087,964 | 414,000,000 |
CONDENSED CONSOLIDATED STATEMEN
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (Unaudited) - Statements of Operations - USD ($) | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2016 | Sep. 30, 2015 | Sep. 30, 2016 | Sep. 30, 2015 | |
Revenues | $ 203,640 | $ 6,500 | ||
Operating expenses: | ||||
Research and development | 205,503 | 119,345 | 544,235 | 279,640 |
Occupancy | 10,114 | 7,500 | 27,595 | 7,500 |
Depreciation | 3,152 | 2,715 | 9,147 | 6,731 |
Other operating expenses | 373,769 | 2,836 | 385,365 | 12,094 |
Total operating expenses | 592,538 | 132,396 | 966,342 | 305,965 |
Loss from operations | (592,538) | (132,396) | (762,702) | (299,465) |
Other income (expense): | ||||
Interest expense | (4,286) | (687) | (10,399) | (1,154) |
Total other income (expense) | (4,286) | (687) | (10,399) | (1,154) |
Loss before income taxes | (596,824) | (133,083) | (773,101) | (300,619) |
Income tax expense | ||||
Net loss | (596,824) | (133,083) | (773,101) | (300,619) |
Accretion on Series A preferred stock | (397,591) | (397,591) | ||
Net loss attributed to common shareholders | $ (994,415) | $ (133,083) | $ (1,170,692) | $ (300,619) |
Basic net loss per common share | $ 0 | $ 0 | $ 0 | $ 0 |
Diluted net loss per common share | $ 0 | $ 0 | $ 0 | $ 0 |
Basic weighted average common shares outstanding | 415,691,123 | 414,000,000 | 414,567,822 | 414,000,000 |
Diluted weighted average common shares outstanding | 415,691,123 | 414,000,000 | 414,567,822 | 414,000,000 |
CONDENSED CONSOLIDATED STATEME5
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited) - Statements of Cash Flows - USD ($) | 9 Months Ended | 12 Months Ended | |
Sep. 30, 2016 | Sep. 30, 2015 | Dec. 31, 2015 | |
Operating Activites: | |||
Net loss | $ (773,101) | $ (300,619) | |
Adjustments to reconcile net loss to net cash used in operating activities: | |||
Stock based compensation | 78,472 | ||
Depreciation | 9,147 | 6,731 | |
Changes in operating assets and liabilities: | |||
Prepaid expenses and other current assets | (7,971) | ||
Deferred contracted software development costs - related party | 55,938 | ||
Escrow fund payments | 250 | ||
Deposits | (44,876) | ||
Accrued interest | 8,040 | 1,030 | |
Accounts payable and accrued expenses | 2,112 | 5,284 | |
Unearned revenue - related party | (156,000) | 81,000 | |
Net Cash Used in Operating Activities | (827,989) | (206,574) | |
Investing Activities: | |||
Purchases of property and equipment | (8,737) | (22,781) | |
Cash acquired in merger | 420 | ||
Net Cash Used in Investing Activities | (8,317) | (22,781) | |
Financing Activities: | |||
Proceeds from sale of Series A Preferred stock | 1,500,004 | ||
Escrow fund cash received | (215,000) | ||
Capital contributions | 325,000 | 25,000 | |
Proceeds from notes payable | 25,000 | ||
Payments on notes payable | (27,500) | ||
Proceeds from convertible notes payable - members | 25,000 | ||
Proceeds from officer loans | 111,300 | ||
Net Cash Provided by Financing Activities | 1,607,504 | 161,300 | |
Net Increase (Decrease) in Cash | 771,198 | (68,055) | |
Cash - Beginning of Period | 3,165 | 85,163 | $ 85,163 |
Cash - End of Period | 774,363 | 17,108 | $ 3,165 |
Net assets acquired in reverse acquisition: | |||
Goodwill | 6,160,229 | ||
Accounts payable | (31,100) | ||
Notes payable - related party | (174,058) | ||
Net assets acquired | 5,955,071 | ||
Derivative liability | 1,103,276 | ||
Common stock issued for officers loans, related party notes and accrued interest | 193,933 | ||
Conversion of Series C Preferred stock to common stock | 10,000 | ||
Supplemental disclosure of cash flow information: | |||
Interest paid in cash | 1,268 | ||
Income taxes paid in cash |
Summary of Significant Accounti
Summary of Significant Accounting Policies and Use of Estimates | 9 Months Ended |
Sep. 30, 2016 | |
Accounting Policies [Abstract] | |
Summary of Significant Accounting Policies and Use of Estimates | 1. Summary of Significant Accounting Policies and Use of Estimates Basis of Presentation and Organization and Reorganization EnergyTek Corp., is a Nevada corporation which has two wholly-owned subsidiaries, Texas Gulf Exploration & Production, Inc., and Legal Capital Corp. In January 2015, EnergyTek Corp. entered into a Joint Venture with Wagley Offshore-Onshore, Inc. to acquire distressed energy assets. In July 2016, the Company entered into an agreement to terminate this Joint Venture and it was dissolved on September 26, 2016. Effective September 13, 2016, EnergyTek Corp. entered into an Agreement and Plan of Merger ("Merger Agreement") through which it acquired Timefire, LLC (Timefire), a Phoenix-based virtual reality content developer that is an Arizona Limited Liability Company. As consideration for the merger, EnergyTek Corp. issued the equity holders of Timefire a total of 414,000,000 shares of its common stock, and 28,000,000 five year warrants exercisable at $0.058 per share for 100% of the membership interests of Timefire. As a result, the former members of Timefire owned approximately 99% of the then outstanding shares of common stock. The consolidated entities hereinafter are referred to as the Company. The operations of the Company from the acquisition date represent the business of Timefire. For accounting purposes the transaction is being recorded as a reverse acquisition, with Timefire as the accounting acquirer. The 414,000,000 shares of common stock issued in the transaction are shown as outstanding for all periods presented in the same manner as a stock split. The accompanying consolidated financial statements reflect the consolidated operations of the company from September 13, 2016. Unaudited Interim Financial Statements The interim condensed consolidated financial statements of the Company as of September 30, 2016 and 2015, and for the periods then ended, are prepared in accordance with the instructions to Form 10-Q. Accordingly, the accompanying condensed consolidated financial statements and notes thereto do not reflect all disclosures required under accounting principles generally accepted in the United States of America. However, in the opinion of management, the interim financial statements include all adjustments, consisting of only normal recurring adjustments, necessary to present fairly the Companys financial position as of September 30, 2016 and the results of its operations and its cash flows for the periods ended September 30, 2016 and 2015. These results are not necessarily indicative of the results expected for the year ended December 31, 2016. The financial statements should be read in conjunction with the latest annual financial statements. Principles of Consolidation The consolidated financial statements include the accounts of the Company and its wholly-owned subsidiaries. All significant intercompany transactions and balances have been eliminated. Equity investments through which we exercise significant influence over but do not control the investee and are not the primary beneficiary of the investee's activities are accounted for using the equity method where applicable. Accounting Estimates The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America (U.S. GAAP) requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenue and expenses during the reporting period. Actual results could materially differ from those estimates. Significant estimates of the Company include accounting for depreciation and amortization, derivative liability, accruals and contingencies, the fair value of Company common stock and the estimated fair value of warrants. Revenue Recognition The Company uses Financial Accounting Standards Board (FASB) Accounting Standards Codification (ASC) No. 605 for revenue recognition. The Company recognizes revenue when it is realized or realizable and earned. The Company considers revenue realized or realizable and earned when all of the following criteria are met: (i) persuasive evidence of an arrangement exists, (ii) the sales price is fixed or determinable, and (iii) collectability is reasonably assured. Cash and Cash Equivalents The Company considers all highly liquid instruments, with original maturity of three months or less when purchased, to be cash equivalents. Escrow Fund Pursuant to the Series A Preferred Stock Securities Purchase Agreement ("SPA") (see Note 7), the Company was required to hold an initial amount of $215,000 in cash in escrow. The cash is restricted to be used for certain expenses as defined in the agreement. In addition, for the 24 months following the closing of the SPA, the Company is required to deposit 15% of the gross proceeds of any offering of securities with the Company or any cash exercise of any common stock equivalents, including cash proceeds from the exercise of any warrants issued to investors involved with the SPA. As of September 30, 2016, $250 has been disbursed from the escrow account, leaving a remaining balance of $214,750. Property and Equipment Property and equipment are recorded at cost. Depreciation is provided for on the straight-line method, over the estimated useful lives of the assets. Maintenance and repairs that neither materially add to the value of the property nor appreciably prolong its life are charged to expense as incurred. Betterments or renewals are capitalized when incurred. Gains and losses on the disposition of property and equipment are recorded in the period incurred. The estimated useful lives of property and equipment are: Of 5 years Impairment of Long-Lived Assets and Amortizable Intangible Assets The Company follows ASC 360-10, "Property, Plant, and Equipment," "primary asset" Intangible Assets - Goodwill The excess of the purchase price over net tangible and identifiable intangible assets of the business acquired is carried as Goodwill on the balance sheet. Goodwill is not amortized, but instead is assessed for impairment at least annually and upon the occurrence of certain triggering events or substantive changes in circumstances that indicate that the fair value of goodwill may be impaired. Measurement of the impairment loss, if any, is based on the difference between the carrying value and fair value of reporting unit. The goodwill impairment test follows a two-step process. In the first step, the fair value of a reporting unit is compared to its carrying value. If the carrying value of a reporting unit exceeds its fair value, the second step of the impairment test is performed for purposes of measuring the impairment. In the second step, the fair value of the reporting unit is allocated to all of the assets and liabilities of the reporting unit to determine an implied goodwill value. If the carrying amount of the reporting unit's goodwill exceeds the implied fair value of goodwill, an impairment loss will be recognized in an amount equal to that excess. During the quarter ended September 30, 2016, the Company did not recognize any impairment charges. Business segments ASC 280, "Segment Reporting" "management approach" Income Taxes The Company accounts for income taxes under FASB ASC 740, Income Taxes Net Loss per Share Basic earnings per share does not include dilution and is computed by dividing income available to common stockholders by the weighted average number of common shares outstanding for the period. Diluted earnings per share reflect the potential dilution of securities that could share in the earnings of an entity. Dilutive securities are not included in the weighted average number of shares when inclusion would be anti-dilutive. Due to the net losses for the periods ended September 30, 2016 and 2015, basic and diluted loss per common share were the same, as the effect of potentially dilutive securities would have been anti-dilutive. As of September 30, 2016, there was a total of 221,199,427 shares of common stock issuable upon conversion of preferred stock and the exercise of warrants and vesting of restricted stock units that were not included in the earnings per share calculation as they were anti-dilutive. Fair Value Measurements ASC 820 Fair Value Measurements defines fair value, establishes a framework for measuring fair value in generally accepted accounting principles, and expands disclosure about fair value measurements. The following provides an analysis of financial instruments that are measured subsequent to initial recognition at fair value, grouped into Levels 1 to 3 based on the degree to which fair value is observable: Level 1- fair value measurements are those derived from quoted prices (unadjusted in active markets for identical assets or liabilities); Level 2- fair value measurements are those derived from inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly (i.e. as prices) or indirectly (i.e. derived from prices); and Level 3- fair value measurements are those derived from valuation techniques that include inputs for the asset or liability that are not based on observable market data (unobservable inputs). Financial instruments classified as Level 1 - quoted prices in active markets include cash. These financial instruments are measured using managements best estimate of fair value, where the inputs into the determination of fair value require significant management judgment to estimation. Valuations based on unobservable inputs are highly subjective and require significant judgments. Changes in such judgments could have a material impact on fair value estimates. In addition, since estimates are as of a specific point in time, they are susceptible to material near-term changes. Changes in economic conditions may also dramatically affect the estimated fair values. Fair value estimates discussed herein are based upon certain market assumptions and pertinent information available to management as of September 30, 2016. The respective carrying value of certain financial instruments approximated their fair values due to the short-term nature of these instruments. These financial instruments include cash, accounts payable and accrued expenses. Subsequent Events In accordance with ASC 855 Subsequent Events the Company evaluated subsequent events after the balance sheet date. |
Going Concern
Going Concern | 9 Months Ended |
Sep. 30, 2016 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Going Concern | 2. Going Concern The Company has incurred losses since inception and requires additional funds for future operating activities. The Companys selling activity has not reached a level of revenue sufficient to fund its operating activities. These factors create an uncertainty as to how the Company will fund its operations and maintain sufficient cash flow to operate as a going concern. The combination of these factors, among others, raise doubt about the Companys ability to continue as a going concern. The Companys ability to meet its cash requirements in the next year is dependent upon obtaining additional financing. If this is not achieved, the Company may be unable to obtain sufficient cash flow to fund its operations and obligations, and as a result there is substantial doubt the Company will be able to continue as a going concern. The accompanying condensed consolidated financial statements have been prepared on a going concern basis, and accordingly, do not include any adjustments relating to the recoverability and classification of recorded asset amounts; nor do they include adjustments to the amounts and classification of liabilities that might be necessary should the Company be unable to continue operations or be required to sell its assets. |
Reverse Acquisition
Reverse Acquisition | 9 Months Ended |
Sep. 30, 2016 | |
Business Combinations [Abstract] | |
Reverse Acquisition | 3. Reverse Acquisition The Company accounted for the Merger Agreement with Timefire as a reverse acquisition, with Timefire being the accounting acquirer. In its determination that Timefire was the accounting acquirer, the Company considered pertinent facts and circumstances, including the following: (i) the Timefire owners received the largest portion of the voting rights of the combined entity; (ii) the management team of the combined entity is primarily comprised of owners or management of Timefire; (iii) the Board of Directors of the combined entity is primarily comprised of owners, management or affiliates of Timefire; (iv) the continuing business of the combined entity will be the business of Timefire. In accounting for the reverse acquisition, the Company considered the market price of its common stock to be the most reliable measure of the consideration effectively transferred. On the acquisition date the price of the Company's common stock was $0.0452 per share and the number of shares of common stock outstanding, including common stock issuable upon the conversion of outstanding convertible preferred stock, amounted to 131,758,655 shares which resulted in the fair value of the consideration equaling $5,955,491. The net liabilities at the acquisition date totaled $204,738, resulting in goodwill of $6,160,229. None of the goodwill is expected to be deductible for income tax purposes. The amount of net loss of the accounting acquiree included in the Company's consolidated statements of operations from the acquisition date, September 13, 2016, to the period ending September 30, 2016 are as follows: For the Three Months Ended For the Nine Months Ended September 30, September 30, 2016 2015 2016 2015 Revenues $ $ $ $ Net loss $ (310,971 ) $ $ (310,971 ) $ Basic and diluted loss per share $ (0.00 ) $ $ (0.00 ) $ The following supplemental pro forma information presents the consolidated financial results as if the acquisition of the accounting acquiree had occurred January 1, 2015. For the Three Months Ended For the Nine Months Ended September 30, September 30, 2016 2015 2016 2015 Revenues $ $ 19,101 $ 203,640 $ 65,904 Net loss $ (768,717 ) $ (2,530,475 ) $ (1,038,301 ) $ (2,798,515 ) Basic and diluted loss per share $ (0.00 ) $ (0.01 ) $ (0.00 ) $ (0.01 ) |
Notes Payable to Related Partie
Notes Payable to Related Parties | 9 Months Ended |
Sep. 30, 2016 | |
Debt Disclosure [Abstract] | |
Notes Payable to Related Parties | 4. Notes Payable to Related Parties Notes payable to related parties consist of amounts owed by Texas Gulf Exploration & Production, Inc. to parties related to the Company. As a term of the Merger Agreement, Texas Gulf Exploration & Production, Inc. will become a wholly-owned subsidiary of Litigation Capital, Inc, a non-related entity, once certain requirements have been met, and the debt will be assumed by that entity. |
Related Party Transactions
Related Party Transactions | 9 Months Ended |
Sep. 30, 2016 | |
Related Party Transactions [Abstract] | |
Related Party Transactions | 5. Related Party Transactions During the year ended December 31, 2015, the Company entered into an agreement with a related party, an entity in which two of the Timefire members have significant ownership, to provide software development services. During 2015, the Company received $156,000 in payments for these services. The contracted services had not yet been completed as of December 31, 2015, and all amounts received were classified as unearned revenue. During the nine months ended September 30, 2016, the Company completed this work, recognizing the previously unearned revenue from 2015 as well as an additional $46,500, for a total of $202,500 in revenue from the related party. |
Commitments and Contingencies
Commitments and Contingencies | 9 Months Ended |
Sep. 30, 2016 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | 6. Commitments and Contingencies Employment Agreements Effective September 13, 2016, the Company entered into an employment agreement with its Chief Executive Officer ("CEO"). The agreement is for a two year period at the rate of $150,000 per annum. The agreement will be automatically extended for additional terms of one year each unless terminated by either party. In addition to other customary benefits, the CEO was granted 5,000,000 restricted stock units ("RSUs"). The RSUs vest over a 2 year period (see Note 7). Effective September 13, 2016, the Company entered into an employment agreement with its new President. The agreement is for a two year period at the rate of $150,000 per annum. The agreement will be automatically extended for additional terms of one year each unless terminated by either party. Effective September 13, 2016, the Company entered into an employment agreement with its new Chief Strategy Officer. The agreement is for a two year period at the rate of $150,000 per annum. The agreement will be automatically extended for additional terms of one year each unless terminated by either party. Lease Agreements On September 23, 2016, the Company entered into an office lease agreement commencing October 1, 2016 for a new location, after having outgrown the prior facility. This lease expires December 31, 2018. A concession of the first five months rent was provided. After that time, the monthly rent will be $8,121 for months 6 through 17, and $8,375 for months 18 through 27. The Company continues to be obligated to pay the monthly rent of $2,596 on its prior facility lease, which expires January 2017, unless the landlord enters into a lease with a new tenant prior to that date. |
Shareholders' Deficit and Serie
Shareholders' Deficit and Series A Preferred Stock | 9 Months Ended |
Sep. 30, 2016 | |
Equity [Abstract] | |
Shareholders' Deficit and Series A Preferred Stock | 7. Shareholders Deficit and Series A Preferred Stock Common Stock There is currently only one class of common stock. Each share common stock is entitled to one vote. The authorized number of shares of common stock of the Company at September 30, 2016 was 500,000,000 shares with a par value per share of $0.001. Authorized shares that have been issued and fully paid amounted to 430,087,964 as of September 30, 2016. On September 13, 2016, the Company entered into a Merger Agreement through which the Company acquired Timefire (See Note 1). As consideration for the merger, the Company issued the equity holders of Timefire a total of 414,000,000 shares of the Companys common stock, and 28,000,000 five year warrants exercisable at $0.058 per share for 100% of the membership interests of Timefire. The members of Timefire may also be entitled to additional warrants contingent on certain future financings, as defined in the Merger Agreement. Preferred Stock The Company is authorized to issue 10,000,000 shares of Preferred stock with a par value of $0.01 per share, with rights, preferences and limitations as may be decided from time-to-time by the Board of Directors. Series C In 2014, the Board of Directors approved the issuance of Series C Preferred Stock ("Series C"). 900 Shares of Series C Preferred Stock were issued in exchange for 900 Shares of previously issued Series A Preferred Stock ("Prior Series A"). Each share of Series C shall be convertible at the option of the holder at any time, into 100,000 shares of common stock. Each holder of Series C shall be entitled to one vote for each share of Series C held. Holders cannot convert their Series C to the extent that after such conversion, they and their affiliates would beneficially own in excess of 9.99% of the Companys common stock, which limitation is waivable upon 61 days notice to the Company. In 2015, 10 Series C shares were converted into 1,000,000 shares of our common stock. In 2016, holders of 137 shares of Series C converted them into 13,700,000 shares of our common stock. At September 30, 2016, there are 753 shares of Series C outstanding. Series A-1 Effective August 24, 2016, the Board of Directors approved the issuance of Series A-1 Preferred Stock ("Series A-1"). The Company entered into agreements with certain note holders under which the note holders agreed to convert an aggregate of $229,170 in principal and accrued interest into a total of 20,371 shares of Series A-1 Preferred Stock. Each share of Series A-1 shall be convertible at the option of the holder at any time, into 1,000 shares of common stock. The Series A-1 ranks senior to the common stock and junior to the Series C. Holders of Series A-1 are entitled to receive dividends and vote together with holders of the common stock on an as-converted basis. Holders cannot convert their Series A-1 to the extent that after such conversion, they and their affiliates would beneficially own in excess of 2.49% of the Companys common stock, which limitation is waivable upon 61 days notice to the Company. At September 30, 2016, there are 20,371 shares of Series A-1 outstanding. Series A Effective September 13, 2016, the Company closed on a Securities Purchase Agreement and the Board of Directors approved the issuance of a newly designated Series A Convertible Preferred Stock ("New Series A"). Pursuant to the agreement the Company issued and sold approximately 133,334 shares of New Series A to certain investors for gross proceeds of $1,500,004 and 25,862,069 five-year Warrants exercisable at $0.058 per share. The New Series A are convertible into approximately 66,666,844 shares of common stock. Holders cannot convert their New Series A to the extent that after such conversion, they and their affiliates would beneficially own in excess of 2.49% of the Companys common stock, which limitation is waivable upon 61 days notice to the Company. In addition, the investors were issued a total of 25,862,069 five-year warrants exercisable at $0.058 per share containing a similar 2.49% ownership blocker. At any time after the earlier of (i) the Company having affected a one-for-six reverse stock split or combination or (ii) November 30, 2016, each share of New Series A shall be convertible into shares of Company common stock. New Series A shall be convertible, at the option of the holder, into 500 shares of common stock, subject to certain adjustments. The New Series A ranks senior to all other classes and series of the Company's capital stock. Holders of New Series A are entitled to receive dividends and vote together with holders of the common stock on an as-converted basis. At September 30, 2016, there are 133,334 shares of New Series A outstanding. The Company recorded a discount of $1,500,004 as a result of a New Series A beneficial conversion feature. The beneficial conversion feature is being amortized as a deemed dividend over the period from issuance to the earliest date the New Series A becomes convertible, which the Company considers to be November 30, 2016 for this calculation. As of September 30, 2016, $397,591 has been accreted as a dividend, and due to the lack of retained earnings has been offset to additional paid-in capital. New Series A contains certain provisions that are outside the Company's control and which the Company believes cause the New Series A to be classified as mezzanine equity. Warrants The balance of warrants outstanding for purchase of the Companys common stock as of September 30, 2016 is as follows: Common Shares Exercise Date Issued Expiration Date Balance of warrants at December 31, 2015 Issued per Merger Agreement (1) 28,000,000 $ .058 9/9/2016 9/9/2021 Issued per Securities Purchase Agreement (2) 25,862,069 $ .058 9/9/2016 9/9/2021 Balance of warrants at September 30, 2016 53,862,069 (1) On September 13, 2016, per the terms of the Merger Agreement (see Note 1), the Company issued five-year warrants at $.058 to purchase 28,000,000 shares of common stock to the original Timefire investors. Fair value of $1,194,480 is recorded in recapitalization. (2) On September 13, 2016, per the terms of the Securities Purchase Agreement, the Company issued five-year warrants at $.058 to purchase 25,862,069 shares of common stock (see above). Fair value of $1,103,276 is recorded as a derivative liability and a reduction in Series A Preferred additional paid-in capital September 30, 2016. The fair value of the warrants, an aggregate of $2,297,756, is estimated using the Black-Scholes pricing model using the following assumptions: dividend yield 0%; risk-free interest rate - 1.23%; expected life 5 years; volatility 174.401%. 2016 Equity Incentive Plan Effective September 13, 2016, the Company adopted the 2016 Equity Incentive Plan (the "2016 Plan") to provide an incentive to our employees, consultants, officers and directors who are responsible for or contribute to our long range success. A total of 33,000,000 shares of our common stock have been reserved for the implementation of the 2016 Plan, either through the issuance of incentive stock options, non-qualified stock options, stock appreciation rights ("SARs"), restricted awards, or restricted stock units ("RSUs"). Whenever practical, the 2016 Plan is to be administered by a committee of not less than two members of the Board of Directors appointed by the full Board, and the 2016 Plan has a term of ten years, unless sooner terminated by the Board. As of September 30, 2016, 28,000,000 shares of common stock are available for issuance under the 2016 Plan. Effective September 13, 2016, pursuant to his employment agreement, the Company entered into a Restricted Stock Unit Agreement with its CEO which granted the CEO 5,000,000 RSUs pursuant to the 2016 Plan. The RSUs vest in three approximately equal increments with the first tranche being fully vested on the grant date and the remaining tranches vesting on the first-year and second-year anniversaries of the grant date. The fair value of the award was calculated based on the price of the common stock on the grant date and is being charged to operations over the vesting period. The expense recorded in the nine months ended September 30, 2016 is $78,472. Shareholders' Equity/(Deficit) Post Merger The shareholders' equity/(deficit) post-merger is presented as follows: Preferred Common Additional Shareholders Stock Stock Paid in Accumulated Equity Shares Amount Shares Amount Capital Deficit (Deficit) Balance at December 31, 2014 $ 414,000,000 $ 414,000 $ (189,000 ) $ (110,875 ) $ 114,125 Capital contribution 25,000 25,000 Net loss (381,735 ) (381,735 ) Balance at December 31, 2015 414,000,000 414,000 (164,000 ) (492,610 ) (242,610 ) Reverse acquisition September 13, 2016 21,224 213 6,087,964 6,088 6,468,123 6,474,424 Preferred Series C stock converted to common (100 ) (1 ) 10,000,000 10,000 (9,999 ) Stock-based compensation - restricted stock units 78,472 78,472 Net loss (773,101 ) (773,101 ) Balance at September 30, 2016 (unaudited) 21,124 $ 212 430,087,964 $ 430,088 $ 6,372,596 $ (1,265,711 ) $ 5,537,185 |
Fair Value Measurements
Fair Value Measurements | 9 Months Ended |
Sep. 30, 2016 | |
Fair Value Disclosures [Abstract] | |
Fair Value Measurements | 8. Fair Value Measurements The following summarizes the Company's financial liabilities that are measured at fair value on a recurring basis at September 30, 2016. Level 1 Level 2 Level 3 Total Liabilities Derivative liabilities $ $ $ 1,103,276 $ 1,103,276 |
Subsequent Events
Subsequent Events | 9 Months Ended |
Sep. 30, 2016 | |
Subsequent Events [Abstract] | |
Subsequent Events | 9. Subsequent Events On November 7, 2016, the Company issued 1,246,000 shares of common stock in exchange for 12.46 shares of Series C Preferred. On November 14, 2016, the Company filed a Certificate of Amendment to its Articles of Incorporation with the Secretary of State of Nevada to change the Company's name to TimefireVR Inc. and implement a reverse stock split of its common stock at a ratio of one-for-10. The name change and reverse stock split will each become effective November 21, 2016. |
Summary of Significant Accoun15
Summary of Significant Accounting Policies and Use of Estimates (Policies) | 9 Months Ended |
Sep. 30, 2016 | |
Accounting Policies [Abstract] | |
Basis of Presentation and Organization and Reorganization | Basis of Presentation and Organization and Reorganization EnergyTek Corp., is a Nevada corporation which has two wholly-owned subsidiaries, Texas Gulf Exploration & Production, Inc., and Legal Capital Corp. In January 2015, EnergyTek Corp. entered into a Joint Venture with Wagley Offshore-Onshore, Inc. to acquire distressed energy assets. In July 2016, the Company entered into an agreement to terminate this Joint Venture and it was dissolved on September 26, 2016. Effective September 13, 2016, EnergyTek Corp. entered into an Agreement and Plan of Merger ("Merger Agreement") through which it acquired Timefire, LLC (Timefire), a Phoenix-based virtual reality content developer that is an Arizona Limited Liability Company. As consideration for the merger, EnergyTek Corp. issued the equity holders of Timefire a total of 414,000,000 shares of its common stock, and 28,000,000 five year warrants exercisable at $0.058 per share for 100% of the membership interests of Timefire. As a result, the former members of Timefire owned approximately 99% of the then outstanding shares of common stock. The consolidated entities hereinafter are referred to as the Company. The operations of the Company from the acquisition date represent the business of Timefire. For accounting purposes the transaction is being recorded as a reverse acquisition, with Timefire as the accounting acquirer. The 414,000,000 shares of common stock issued in the transaction are shown as outstanding for all periods presented in the same manner as a stock split. The accompanying consolidated financial statements reflect the consolidated operations of the company from September 13, 2016. |
Unaudited Interim Financial Statements | Unaudited Interim Financial Statements The interim condensed consolidated financial statements of the Company as of September 30, 2016 and 2015, and for the periods then ended, are prepared in accordance with the instructions to Form 10-Q. Accordingly, the accompanying condensed consolidated financial statements and notes thereto do not reflect all disclosures required under accounting principles generally accepted in the United States of America. However, in the opinion of management, the interim financial statements include all adjustments, consisting of only normal recurring adjustments, necessary to present fairly the Companys financial position as of September 30, 2016 and the results of its operations and its cash flows for the periods ended September 30, 2016 and 2015. These results are not necessarily indicative of the results expected for the year ended December 31, 2016. The financial statements should be read in conjunction with the latest annual financial statements. |
Principles of Consolidation | Principles of Consolidation The consolidated financial statements include the accounts of the Company and its wholly-owned subsidiaries. All significant intercompany transactions and balances have been eliminated. Equity investments through which we exercise significant influence over but do not control the investee and are not the primary beneficiary of the investee's activities are accounted for using the equity method where applicable. |
Accounting Estimates | Accounting Estimates The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America (U.S. GAAP) requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenue and expenses during the reporting period. Actual results could materially differ from those estimates. Significant estimates of the Company include accounting for depreciation and amortization, derivative liability, accruals and contingencies, the fair value of Company common stock and the estimated fair value of warrants. |
Revenue Recognition | Revenue Recognition The Company uses Financial Accounting Standards Board (FASB) Accounting Standards Codification (ASC) No. 605 for revenue recognition. The Company recognizes revenue when it is realized or realizable and earned. The Company considers revenue realized or realizable and earned when all of the following criteria are met: (i) persuasive evidence of an arrangement exists, (ii) the sales price is fixed or determinable, and (iii) collectability is reasonably assured. |
Cash and Cash Equivalents | Cash and Cash Equivalents The Company considers all highly liquid instruments, with original maturity of three months or less when purchased, to be cash equivalents. |
Escrow Fund | Escrow Fund Pursuant to the Series A Preferred Stock Securities Purchase Agreement ("SPA") (see Note 7), the Company was required to hold an initial amount of $215,000 in cash in escrow. The cash is restricted to be used for certain expenses as defined in the agreement. In addition, for the 24 months following the closing of the SPA, the Company is required to deposit 15% of the gross proceeds of any offering of securities with the Company or any cash exercise of any common stock equivalents, including cash proceeds from the exercise of any warrants issued to investors involved with the SPA. As of September 30, 2016, $250 has been disbursed from the escrow account, leaving a remaining balance of $214,750. |
Property and Equipment | Property and Equipment Property and equipment are recorded at cost. Depreciation is provided for on the straight-line method, over the estimated useful lives of the assets. Maintenance and repairs that neither materially add to the value of the property nor appreciably prolong its life are charged to expense as incurred. Betterments or renewals are capitalized when incurred. Gains and losses on the disposition of property and equipment are recorded in the period incurred. The estimated useful lives of property and equipment are: Of 5 years |
Impairment of Long-Lived Assets and Amortizable Intangible Assets | Impairment of Long-Lived Assets and Amortizable Intangible Assets The Company follows ASC 360-10, "Property, Plant, and Equipment," "primary asset" |
Intangible Assets - Goodwill | Intangible Assets - Goodwill The excess of the purchase price over net tangible and identifiable intangible assets of the business acquired is carried as Goodwill on the balance sheet. Goodwill is not amortized, but instead is assessed for impairment at least annually and upon the occurrence of certain triggering events or substantive changes in circumstances that indicate that the fair value of goodwill may be impaired. Measurement of the impairment loss, if any, is based on the difference between the carrying value and fair value of reporting unit. The goodwill impairment test follows a two-step process. In the first step, the fair value of a reporting unit is compared to its carrying value. If the carrying value of a reporting unit exceeds its fair value, the second step of the impairment test is performed for purposes of measuring the impairment. In the second step, the fair value of the reporting unit is allocated to all of the assets and liabilities of the reporting unit to determine an implied goodwill value. If the carrying amount of the reporting unit's goodwill exceeds the implied fair value of goodwill, an impairment loss will be recognized in an amount equal to that excess. During the quarter ended September 30, 2016, the Company did not recognize any impairment charges. |
Business segments | Business segments ASC 280, "Segment Reporting" "management approach" |
Income Taxes | Income Taxes The Company accounts for income taxes under FASB ASC 740, Income Taxes |
Net Loss per Share | Net Loss per Share Basic earnings per share does not include dilution and is computed by dividing income available to common stockholders by the weighted average number of common shares outstanding for the period. Diluted earnings per share reflect the potential dilution of securities that could share in the earnings of an entity. Dilutive securities are not included in the weighted average number of shares when inclusion would be anti-dilutive. Due to the net losses for the periods ended September 30, 2016 and 2015, basic and diluted loss per common share were the same, as the effect of potentially dilutive securities would have been anti-dilutive. As of September 30, 2016, there was a total of 221,199,427 shares of common stock issuable upon conversion of preferred stock and the exercise of warrants and vesting of restricted stock units that were not included in the earnings per share calculation as they were anti-dilutive. |
Fair Value Measurements | Fair Value Measurements ASC 820 Fair Value Measurements defines fair value, establishes a framework for measuring fair value in generally accepted accounting principles, and expands disclosure about fair value measurements. The following provides an analysis of financial instruments that are measured subsequent to initial recognition at fair value, grouped into Levels 1 to 3 based on the degree to which fair value is observable: Level 1- fair value measurements are those derived from quoted prices (unadjusted in active markets for identical assets or liabilities); Level 2- fair value measurements are those derived from inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly (i.e. as prices) or indirectly (i.e. derived from prices); and Level 3- fair value measurements are those derived from valuation techniques that include inputs for the asset or liability that are not based on observable market data (unobservable inputs). Financial instruments classified as Level 1 - quoted prices in active markets include cash. These financial instruments are measured using managements best estimate of fair value, where the inputs into the determination of fair value require significant management judgment to estimation. Valuations based on unobservable inputs are highly subjective and require significant judgments. Changes in such judgments could have a material impact on fair value estimates. In addition, since estimates are as of a specific point in time, they are susceptible to material near-term changes. Changes in economic conditions may also dramatically affect the estimated fair values. Fair value estimates discussed herein are based upon certain market assumptions and pertinent information available to management as of September 30, 2016. The respective carrying value of certain financial instruments approximated their fair values due to the short-term nature of these instruments. These financial instruments include cash, accounts payable and accrued expenses. |
Subsequent Events | Subsequent Events In accordance with ASC 855 Subsequent Events the Company evaluated subsequent events after the balance sheet date. |
Reverse Acquisition (Tables)
Reverse Acquisition (Tables) | 9 Months Ended |
Sep. 30, 2016 | |
Business Combinations [Abstract] | |
Net loss of the accounting acquiree included in the Company's consolidated statements of operations from the acquisition date | For the Three Months Ended For the Nine Months Ended September 30, September 30, 2016 2015 2016 2015 Revenues $ $ $ $ Net loss $ (310,971 ) $ $ (310,971 ) $ Basic and diluted loss per share $ (0.00 ) $ $ (0.00 ) $ |
Supplemental pro forma information of consolidated financial results as if the acquisition of the accounting acquiree had occurred January 1, 2015 | For the Three Months Ended For the Nine Months Ended September 30, September 30, 2016 2015 2016 2015 Revenues $ $ 19,101 $ 203,640 $ 65,904 Net loss $ (768,717 ) $ (2,530,475 ) $ (1,038,301 ) $ (2,798,515 ) Basic and diluted loss per share $ (0.00 ) $ (0.01 ) $ (0.00 ) $ (0.01 ) |
Shareholders' Deficit and Ser17
Shareholders' Deficit and Series A Preferred Stock (Tables) | 9 Months Ended |
Sep. 30, 2016 | |
Equity [Abstract] | |
Balance of warrants outstanding for purchase of Company's common stock | Common Shares Exercise Date Issued Expiration Date Balance of warrants at December 31, 2015 Issued per Merger Agreement (1) 28,000,000 $ .058 9/9/2016 9/9/2021 Issued per Securities Purchase Agreement (2) 25,862,069 $ .058 9/9/2016 9/9/2021 Balance of warrants at September 30, 2016 53,862,069 |
Shareholders' equity/(deficit) post-merger | Preferred Common Additional Shareholders Stock Stock Paid in Accumulated Equity Shares Amount Shares Amount Capital Deficit (Deficit) Balance at December 31, 2014 $ 414,000,000 $ 414,000 $ (189,000 ) $ (110,875 ) $ 114,125 Capital contribution 25,000 25,000 Net loss (381,735 ) (381,735 ) Balance at December 31, 2015 414,000,000 414,000 (164,000 ) (492,610 ) (242,610 ) Reverse acquisition September 13, 2016 21,224 213 6,087,964 6,088 6,468,123 6,474,424 Preferred Series C stock converted to common (100 ) (1 ) 10,000,000 10,000 (9,999 ) Stock-based compensation - restricted stock units 78,472 78,472 Net loss (773,101 ) (773,101 ) Balance at September 30, 2016 (unaudited) 21,124 $ 212 430,087,964 $ 430,088 $ 6,372,596 $ (1,265,711 ) $ 5,537,185 |
Fair Value Measurements (Tables
Fair Value Measurements (Tables) | 9 Months Ended |
Sep. 30, 2016 | |
Fair Value Disclosures [Abstract] | |
Financial liabilities measure at fair value on a recurring basis | Level 1 Level 2 Level 3 Total Liabilities Derivative liabilities $ $ $ 1,103,276 $ 1,103,276 |
Summary of Significant Accoun19
Summary of Significant Accounting Policies and Use of Estimates (Details Narrative) - USD ($) | 1 Months Ended | 9 Months Ended |
Sep. 30, 2016 | Sep. 30, 2016 | |
Escrow | ||
Initial amount of cash held in escrow pursuant to SPA | $ 215,000 | |
Escrow account disbursed | 250 | |
Escrow balance | $ 214,750 | $ 214,750 |
Useful life of property and equipment | 5 years | |
Impairment charges recognized | ||
Antidilutive securities excluded from calculation of earnings per share | 221,199,427 | |
Merger Agreement | ||
Company common stock issued to equity holders of Timefire, shares | 414,000,000 | |
Warrants issued to equity holders of Timefire, shares | 28,000,000 | |
Warrants issued to equity holders of Timefire, exercise price | $ 0.058 | |
Membership interest of Timefire acquired | 100.00% | |
Company voting interest owned by former Timeshare members | 99.00% |
Reverse Acquisition - Net loss
Reverse Acquisition - Net loss of the accounting acquiree included in the Company's consolidated statements of operations from the acquisition date (Details) - Acquiree - USD ($) | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2016 | Sep. 30, 2015 | Sep. 30, 2016 | Sep. 30, 2015 | |
Revenues | ||||
Net loss | $ (310,971) | $ (310,971) | ||
Basic and diluted loss per share | $ 0 | $ 0 |
Reverse Acquisition - Supplemen
Reverse Acquisition - Supplemental pro forma information of consolidated financial results (Details) - Pro forma information - USD ($) | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2016 | Sep. 30, 2015 | Sep. 30, 2016 | Sep. 30, 2015 | |
Revenues | $ 19,101 | $ 203,640 | $ 65,904 | |
Net loss | $ (768,717) | $ (2,530,475) | $ (1,038,301) | $ (2,798,515) |
Basic and diluted loss per share | $ 0 | $ (0.01) | $ 0 | $ (0.01) |
Reverse Acquisition (Details Na
Reverse Acquisition (Details Narrative) | Sep. 13, 2016USD ($)$ / sharesshares |
Business Combinations [Abstract] | |
Common stock outstanding on acquisition date, price | $ / shares | $ 0.0452 |
Common stock outstanding on acquisition date, shares | shares | 131,758,655 |
Common stock outstanding on acquisition date, fair value of consideration | $ 5,955,491 |
Net liabilities at acquisition date | 204,738 |
Goodwill | $ 6,160,229 |
Related Party Transactions (Det
Related Party Transactions (Details Narrative) - USD ($) | 9 Months Ended | 12 Months Ended |
Sep. 30, 2016 | Dec. 31, 2015 | |
Related Party Transactions [Abstract] | ||
Recognition of unearned revenue received from related parties for software development services | $ 202,500 | |
Unearned revenue received from related party | $ 156,000 |
Commitments and Contingencies (
Commitments and Contingencies (Details Narrative) - USD ($) | 4 Months Ended | 10 Months Ended | 12 Months Ended | 24 Months Ended |
Dec. 31, 2016 | Dec. 31, 2018 | Feb. 28, 2018 | Sep. 13, 2018 | |
Monthly rent | $ 8,375 | $ 8,121 | ||
Prior facility lease monthly rent obligation | $ 2,596 | |||
CEO | ||||
Annual compensation | $ 150,000 | |||
Grants of restricted stock to CEO | 5,000,000 | |||
President | ||||
Annual compensation | $ 150,000 | |||
Chief Strategy Officer | ||||
Annual compensation | $ 150,000 |
Shareholders' Deficit and Ser25
Shareholders' Deficit and Series A Preferred Stock - Balance of warrants outstanding for purchase of Company's common stock (Details) | 9 Months Ended |
Sep. 30, 2016$ / sharesshares | |
Balance of warrants | |
Common shares issuable upon exercise of warrants, beginning | |
Common shares issuable upon exercise of warrants, ending | 53,862,069 |
Issued per Merger Agreement | |
Warrants issued | 28,000,000 |
Exercise price of warrants | $ / shares | $ 0.058 |
Date issued | Sep. 9, 2016 |
Expiration date | Sep. 9, 2021 |
Issued per Securities Purchase Agreement | |
Warrants issued | 25,862,069 |
Exercise price of warrants | $ / shares | $ 0.058 |
Date issued | Sep. 9, 2016 |
Expiration date | Sep. 9, 2021 |
Shareholders' Deficit and Ser26
Shareholders' Deficit and Series A Preferred Stock - Shareholders' equity/(deficit) post-merger (Details) (Unaudited) - USD ($) | 9 Months Ended | 12 Months Ended |
Sep. 30, 2016 | Dec. 31, 2015 | |
Preferred Stock | ||
Beginning balance, shares | ||
Beginning balance, amount | ||
Capital contribution | ||
Reverse acquisition, shares | 21,224 | |
Reverse acquisition, amount | $ 213 | |
Preferred Series C stock converted to common, shares | (100) | |
Preferred Series C stock converted to common, amount | $ (1) | |
Stock-based compensation - restricted stock units | ||
Net loss | ||
Ending balance, shares | 21,124 | |
Ending balance, amount | $ 212 | |
Common stock | ||
Beginning balance, shares | 414,000,000 | 414,000,000 |
Beginning balance, amount | $ 414,000 | $ 414,000 |
Capital contribution | ||
Reverse acquisition, shares | 6,087,964 | |
Reverse acquisition, amount | $ 6,088 | |
Preferred Series C stock converted to common, shares | 10,000,000 | |
Preferred Series C stock converted to common, amount | $ 10,000 | |
Stock-based compensation - restricted stock units | ||
Net loss | ||
Ending balance, shares | 430,087,964 | 414,000,000 |
Ending balance, amount | $ 430,088 | $ 414,000 |
Additional Paid in Capital | ||
Beginning balance, amount | (164,000) | (189,000) |
Capital contribution | 25,000 | |
Reverse acquisition, amount | 6,468,123 | |
Preferred Series C stock converted to common, amount | (9,999) | |
Stock-based compensation - restricted stock units | 78,472 | |
Net loss | ||
Ending balance, amount | 6,372,596 | (164,000) |
Accumulated Deficit | ||
Beginning balance, amount | (492,610) | (110,875) |
Capital contribution | ||
Reverse acquisition, amount | ||
Preferred Series C stock converted to common, amount | ||
Stock-based compensation - restricted stock units | ||
Net loss | (773,101) | (381,735) |
Ending balance, amount | (1,265,711) | (492,610) |
Shareholders' Equity/(Deficit) | ||
Beginning balance, amount | (242,610) | 114,125 |
Capital contribution | 25,000 | |
Reverse acquisition, amount | 6,474,424 | |
Preferred Series C stock converted to common, amount | ||
Stock-based compensation - restricted stock units | 78,472 | |
Net loss | (773,101) | (381,735) |
Ending balance, amount | $ 5,537,185 | $ (242,610) |
Shareholders' Deficit and Ser27
Shareholders' Deficit and Series A Preferred Stock (Details Narrative) - USD ($) | 9 Months Ended | |
Sep. 30, 2016 | Dec. 31, 2015 | |
Preferred Stock | ||
Principal and accrued interest on note converted to Series A-1 Preferred Stock, amount | $ 229,170 | |
Warrants | ||
Fair value of warrants | $ 2,297,756 | |
Assumptions used to determine fair value of warrants, dividend yield | 0.00% | |
Assumptions used to determine fair value of warrants, risk-free interest rate | 1.23% | |
Assumptions used to determine fair value of warrants, expected life | 5 years | |
Assumptions used to determine fair value of warrants, volatility | 174.401% | |
2016 Equity Incentive Plan | ||
Common stock reserved for implementation of 2016 Equity Incentive Plan, shares | 33,000,000 | |
Common stock available for issuance under 2016 Plan, shares | 28,000,000 | |
Expense recorded on grant of restricted stock units to CEO | $ 78,472 | |
Merger Agreement | ||
Warrants | ||
Company common stock issued, shares | 414,000,000 | |
Warrants issued, shares | 28,000,000 | |
Warrants issued, exercise price | $ 0.058 | |
Fair value of warrants | $ 1,194,480 | |
Securities Purchase Warrant | ||
Preferred Stock | ||
New Series A Preferred Stock issued and sold, shares | 133,334 | |
New Series A Preferred Stock issued and sold, gross proceeds | $ 1,500,004 | |
Common stock that New Series A Preferred Stock issued and sold are convertible to, shares | 66,666,844 | |
Discount recorded as result of New Series A beneficial conversion feature | $ (1,500,004) | |
Warrants | ||
Warrants issued, shares | 25,862,069 | |
Warrants issued, exercise price | $ 0.058 | |
Fair value of warrants | $ 1,103,276 | |
Balance Sheets | ||
Common Stock | ||
Common stock, par value | $ 0.001 | $ 0.001 |
Common stock, shares authorized | 500,000,000 | 500,000,000 |
Common stock, shares issued | 430,087,964 | 414,000,000 |
Common stock, shares outstanding | 430,087,964 | 414,000,000 |
Preferred Stock | ||
Preferred stock, par value | $ 0.01 | $ 0.01 |
Preferred stock, shares authorized | 10,000,000 | 10,000,000 |
Fair Value Measurements - Finan
Fair Value Measurements - Financial liabilities measure at fair value on a recurring basis (Details) | Sep. 30, 2016USD ($) |
Level 1 | |
Liabilities | |
Derivative liabilities | |
Level 2 | |
Liabilities | |
Derivative liabilities | |
Level 3 | |
Liabilities | |
Derivative liabilities | 1,103,276 |
Total | |
Liabilities | |
Derivative liabilities | $ 1,103,276 |
Subsequent Events (Details Narr
Subsequent Events (Details Narrative) - Subsequent Event - shares | Nov. 21, 2016 | Nov. 07, 2016 |
Common stock exchanged for Series C Preferred, shares | 1,246,000 | |
Series C Preferred stock received in exchange for common stock, shares | 12.46 | |
Reverse stock split | 1:10 |