Cover
Cover | 9 Months Ended |
Sep. 30, 2021 | |
Cover [Abstract] | |
Entity Registrant Name | StrikeForce Technologies Inc. |
Entity Central Index Key | 0001285543 |
Document Type | S-1 |
Amendment Flag | false |
Entity Small Business | true |
Entity Emerging Growth Company | false |
Entity Filer Category | Non-accelerated Filer |
Entity File Number | 000-55012 |
Entity Incorporation State Country Code | WY |
Entity Tax Identification Number | 22-3827597 |
Entity Address Address Line 1 | 1090 King Georges Post Road |
Entity Address Address Line 2 | Suite 603 |
Entity Address City Or Town | Edison |
Entity Address State Or Province | NJ |
Entity Address Postal Zip Code | 08837 |
City Area Code | 732 |
Local Phone Number | 661-9641 |
CONDENSED CONSOLIDATED BALANCE
CONDENSED CONSOLIDATED BALANCE SHEETS - USD ($) | Sep. 30, 2021 | Dec. 31, 2020 | Dec. 31, 2019 |
Current Assets: | |||
Cash (includes VIE balances of $2,000 and $2,000, respectively) | $ 3,180,000 | $ 162,000 | $ 75,000 |
Accounts receivable, net | 12,000 | 20,000 | 20,000 |
Prepaid expenses | 11,000 | 21,000 | 4,000 |
Total current assets | 3,203,000 | 203,000 | 99,000 |
Property and equipment, net | 0 | 2,000 | 5,000 |
Operating lease right-of-use asset | 120,000 | 157,000 | 206,000 |
Other assets | 13,000 | 14,000 | 17,000 |
Total Assets | 3,336,000 | 376,000 | 327,000 |
Current Liabilities: | |||
Accounts payable and accrued expenses (includes VIE balances of $5,000 and $3,000, respectively) | 1,029,000 | 1,010,000 | 1,116,000 |
Convertible notes payable (net of discount of $0 and $14,000, respectively; including $1,438,000 and $1,435,000 in default, respectively) | 1,438,000 | 1,469,000 | 1,860,000 |
Convertible notes payable - related parties | 268,000 | 298,000 | 356,000 |
Notes payable (net of discount of $0 and $52,000, respectively; including $1,979,000 and $2,146,000 in default, respectively) (includes VIE balances of $310,000 and $475,000, respectively) | 1,978,000 | 2,250,000 | 2,238,000 |
Notes payable - related parties | 693,000 | 952,000 | 743,000 |
Accrued interest (including $1,467,000 and $1,448,000 due to related parties, respectively) (includes VIE balances of $114,000 and $109,000, respectively) | 5,383,000 | 5,187,000 | 4,842,000 |
Contingent payment obligation | 1,500,000 | 1,500,000 | 1,500,000 |
Financing obligation (includes VIE balance of $1,263,000 and $1,263,000, respectively) | 1,263,000 | 1,263,000 | 1,263,000 |
Operating lease liability, current portion | 39,000 | 38,000 | 47,000 |
Derivative liabilities | 0 | 163,000 | 1,516,000 |
Total current liabilities | 13,591,000 | 14,130,000 | 15,481,000 |
Notes payable, long term portion | 327,000 | 463,000 | 148,000 |
Operating lease liability, long term portion | 86,000 | 125,000 | 162,000 |
Total Liabilities | 14,004,000 | 14,718,000 | 15,791,000 |
Stockholders' Deficit | |||
Preferred stock series not designated par value $0.10: 10,000,000 shares authorized; none issued or outstanding | 0 | 0 | 0 |
Common stock par value $0.0001: 4,000,000,000 shares authorized; 952,896,637 and 718,263,338 shares issued and outstanding, respectively | 95,000 | 72,000 | 1,000 |
Additional paid-in capital | 59,307,000 | 39,814,000 | 28,675,000 |
Accumulated deficit | (70,201,000) | (54,396,000) | (44,353,000) |
Total StrikeForce Technologies, Inc. stockholders' deficit | (9,808,000) | (13,519,000) | (14,686,000) |
Noncontrolling interest in consolidated subsidiary | (860,000) | (823,000) | (778,000) |
Total Stockholders' Deficit | (10,668,000) | (14,342,000) | (15,464,000) |
Total Liabilities and Stockholders' Deficit | 3,336,000 | 376,000 | 327,000 |
Preferred Stock Series A [Member] | |||
Stockholders' Deficit | |||
Preferred stock series not designated par value $0.10: 10,000,000 shares authorized; none issued or outstanding | 987,000 | 987,000 | 987,000 |
Preferred Stock Series B [Member] | |||
Stockholders' Deficit | |||
Preferred stock series not designated par value $0.10: 10,000,000 shares authorized; none issued or outstanding | $ 4,000 | $ 4,000 | $ 4,000 |
CONDENSED CONSOLIDATED BALANC_2
CONDENSED CONSOLIDATED BALANCE SHEETS (Parenthetical) - USD ($) | Sep. 30, 2021 | Dec. 31, 2020 | Dec. 31, 2019 |
Current Assets | |||
Cash VIE | $ 2,000 | $ 2,000 | $ 1,000 |
Current Liabilities | |||
Accounts payables | 5,000 | 3,000 | 27,000 |
Convertible notes payable, net of discount | 0 | 14,000 | 423,000 |
Convertible notes payable, default | 1,438,000 | 1,435,000 | 1,438,000 |
Notes payable VIE | 310,000 | 475,000 | 475,000 |
Notes payable, net of discount | 0 | 52,000 | 0 |
Notes payable, default | 1,979,000 | 2,146,000 | 2,114,000 |
Accrued Interest VIE | 114,000 | 109,000 | 71,000 |
Financing obligation VIE | 1,263,000 | 1,263,000 | 1,263,000 |
Accrued interest due to related parties | $ 1,467,000 | $ 1,448,000 | $ 1,396,000 |
Stockholders' Deficit | |||
Preferred Stock, share par value | $ 0.10 | $ 0.10 | $ 0.10 |
Preferred stock, shares authorized | 10,000,000 | 10,000,000 | 10,000,000 |
Preferred stock, shares issued | 0 | 0 | 0 |
Preferred stock, shares outstanding | 0 | 0 | 0 |
Common stock, shares par value | $ 0.0001 | $ 0.0001 | $ 0.0001 |
Common stock, shares authorized | 4,000,000,000 | 4,000,000,000 | 4,000,000,000 |
Common stock, shares issued | 1,035,000 | 38,116,450 | 5,905,388 |
Common stock, shares outstanding | 952,896,637 | 718,263,338 | 5,905,388 |
Preferred Stock Series A [Member] | |||
Stockholders' Deficit | |||
Preferred stock, shares authorized | 100 | 100 | 100 |
Preferred stock, shares issued | 3 | 3 | 3 |
Preferred stock, shares outstanding | 3 | 3 | 3 |
Preferred Stock Series B [Member] | |||
Stockholders' Deficit | |||
Preferred Stock, share par value | $ 0.10 | $ 0.10 | $ 0.10 |
Preferred stock, shares authorized | 100,000,000 | 100,000,000 | 100,000,000 |
Preferred stock, shares issued | 36,667 | 36,667 | 36,667 |
Preferred stock, shares outstanding | 36,667 | 36,667 | 36,667 |
CONDENSED CONSOLIDATED STATEMEN
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (Unaudited) - USD ($) | 3 Months Ended | 9 Months Ended | 12 Months Ended | |||
Sep. 30, 2021 | Sep. 30, 2020 | Sep. 30, 2021 | Sep. 30, 2020 | Dec. 31, 2020 | Dec. 31, 2019 | |
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (Unaudited) | ||||||
Revenue | $ 40,000 | $ 51,000 | $ 153,000 | $ 162,000 | $ 207,000 | $ 768,000 |
Operating expenses: | ||||||
Cost of revenue | 7,000 | 2,000 | 18,000 | 11,000 | 13,000 | 10,000 |
Selling, general and administrative expenses | 672,000 | 430,000 | 8,120,000 | 1,477,000 | 2,350,000 | 1,839,000 |
Research and development | 112,000 | 126,000 | 386,000 | 373,000 | 520,000 | 520,000 |
Total operating expenses | 791,000 | 558,000 | 8,524,000 | 1,861,000 | 2,883,000 | 2,369,000 |
Loss from operations | (751,000) | (507,000) | (8,371,000) | (1,699,000) | (2,676,000) | (1,601,000) |
Other income (expense): | ||||||
Interest expense (including $91,000 and $98,000 to related parties, respectively) | (102,000) | (177,000) | (344,000) | (510,000) | (654,000) | (505,000) |
Debt discount amortization | 0 | (179,000) | (52,000) | (587,000) | (605,000) | (1,047,000) |
Financing costs | 0 | 0 | (6,569,000) | 0 | ||
Private placement costs | 0 | (37,000) | 0 | 140,000 | (175,000) | (803,000) |
Change in fair value of derivative liabilities | 0 | (47,000) | (219,000) | 165,000 | (1,190,000) | 311,000 |
Gain (loss) on extinguishment of debt, net | 0 | 65,000 | (286,000) | (223,000) | (4,841,000) | 134,000 |
Other income (expense) | 0 | 10,000 | (1,000) | 52,000 | 53,000 | 31,000 |
Other income (expense), net | (102,000) | (365,000) | (7,471,000) | (1,243,000) | (7,412,000) | (2,147,000) |
Loss before income taxes | (10,088,000) | (3,748,000) | ||||
Income tax expense | 0 | 2,000 | ||||
Net loss | (853,000) | (872,000) | (15,842,000) | (2,942,000) | (10,088,000) | (3,750,000) |
Net loss attributable to noncontrolling interest | 20,000 | 9,000 | 37,000 | 30,000 | 45,000 | 222,000 |
Net loss attributable to StrikeForce Technologies, Inc. | $ (833,000) | $ (863,000) | $ (15,805,000) | $ (2,912,000) | $ (10,043,000) | $ (3,528,000) |
Net loss per common share -Basic and diluted | $ 0 | $ (0.04) | $ (0.02) | $ (0.24) | $ (0.14) | $ (0.68) |
Weighted average common shares outstanding -Basic and diluted | 894,767,114 | 22,280,807 | 840,258,105 | 12,169,639 | 73,260,600 | 5,215,411 |
CONDENSED CONSOLIDATED STATEM_2
CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS' DEFICIT (Unaudited) - USD ($) | Total | Series A Preferred Stock | Series B Preferred Stock | Common Stock | Additional Paid-In Capital | Accumulated Deficit | Noncontrolling Interest |
Balance, shares at Dec. 31, 2018 | 3 | 36,667 | 4,747,499 | ||||
Balance, amount at Dec. 31, 2018 | $ (13,802,000) | $ 987,000 | $ 4,000 | $ 1,000 | $ 26,587,000 | $ (40,825,000) | $ (556,000) |
Fair value of common stock issued for services, shares | 60 | ||||||
Fair value of vested options | 21,000 | 21,000 | |||||
Fair value of warrants issued with convertible notes accounted for as debt discount | 60,000 | 60,000 | |||||
Common stock issued upon conversion of notes payable and accrued interest, shares | 1,157,829 | ||||||
Common stock issued upon conversion of notes payable and accrued interest, amount | 2,007,000 | 2,007,000 | |||||
Net loss | (3,750,000) | (3,528,000) | (222,000) | ||||
Balance, shares at Dec. 31, 2019 | 3 | 36,667 | 5,905,388 | ||||
Balance, amount at Dec. 31, 2019 | (15,464,000) | $ 987,000 | $ 4,000 | $ 1,000 | 28,675,000 | (44,353,000) | (777,000) |
Fair value of vested options | 216,000 | 0 | 0 | $ 0 | 216,000 | 0 | 0 |
Net loss | (2,942,000) | (2,912,000) | (30,000) | ||||
Fair value of common stock issued for services, shares | 109,406 | ||||||
Fair value of common stock issued for services, amount | 20,000 | 0 | 0 | $ 0 | 20,000 | 0 | 0 |
Fair value of warrants issued with convertible notes | 53,000 | 0 | 0 | $ 0 | 53,000 | 0 | 0 |
Common stock issued upon conversion of notes and interest, shares | 43,954,085 | ||||||
Common stock issued upon conversion of notes and interest, amount | 2,176,000 | 0 | 0 | $ 4,000 | 2,172,000 | 0 | 0 |
Common stock issued upon conversion of debt settlement, shares | 11,585,725 | ||||||
Common stock issued upon conversion of debt settlement, amount | 333,000 | $ 0 | $ 0 | $ 1,000 | 332,000 | 0 | 0 |
Balance, shares at Sep. 30, 2020 | 3 | 36,667 | 61,554,604 | ||||
Balance, amount at Sep. 30, 2020 | (15,607,000) | $ 987,000 | $ 4,000 | $ 6,000 | 31,468,000 | (47,265,000) | (807,000) |
Balance, shares at Dec. 31, 2019 | 3 | 36,667 | 5,905,388 | ||||
Balance, amount at Dec. 31, 2019 | (15,464,000) | $ 987,000 | $ 4,000 | $ 1,000 | 28,675,000 | (44,353,000) | (777,000) |
Fair value of common stock issued for services, shares | 6,378,671 | ||||||
Fair value of common stock issued for services, amount | 39,000 | $ 1,000 | 38,000 | ||||
Fair value of vested options | 506,000 | 506,000 | |||||
Common stock issued upon conversion of notes payable and accrued interest, shares | 233,674,842 | ||||||
Common stock issued upon conversion of notes payable and accrued interest, amount | 9,112,000 | $ 23,000 | 9,089,000 | ||||
Net loss | (10,088,000) | (10,043,000) | (45,000) | ||||
Common stock issued upon conversion of debt settlement, shares | 35,967,234 | ||||||
Common stock issued upon conversion of debt settlement, amount | 459,000 | $ 3,000 | 456,000 | ||||
Common stock issued for cash, shares | 436,337,203 | ||||||
Common stock issued for cash, amount | 976,000 | $ 44,000 | 932,000 | ||||
Warrants issued with notes payable accounted for as debt discount | 118,000 | 118,000 | |||||
Balance, shares at Dec. 31, 2020 | 3 | 36,667 | 718,263,338 | ||||
Balance, amount at Dec. 31, 2020 | (14,342,000) | $ 987,000 | $ 4,000 | $ 72,000 | 39,814,000 | (54,396,000) | (823,000) |
Balance, shares at Jun. 30, 2020 | 3 | 36,667 | 9,363,610 | ||||
Balance, amount at Jun. 30, 2020 | (15,644,000) | $ 987,000 | $ 4,000 | $ 1,000 | 30,564,000 | (46,402,000) | (798,000) |
Fair value of vested options | 0 | 0 | 0 | $ 0 | 0 | 0 | 0 |
Common stock issued upon conversion of notes payable and accrued interest, shares | 41,039,202 | ||||||
Common stock issued upon conversion of notes payable and accrued interest, amount | 639,000 | 0 | 0 | $ 4,000 | 635,000 | 0 | 0 |
Net loss | (872,000) | 0 | 0 | $ 0 | 0 | (863,000) | (9,000) |
Fair value of common stock issued for services, shares | 10,526 | ||||||
Fair value of common stock issued for services, amount | 0 | 0 | 0 | $ 0 | 0 | 0 | 0 |
Fair value of warrants issued with convertible notes | 35,000 | 0 | 0 | $ 0 | 35,000 | 0 | 0 |
Common stock issued upon conversion of debt settlement, shares | 11,141,266 | ||||||
Common stock issued upon conversion of debt settlement, amount | 235,000 | $ 0 | $ 0 | $ 1,000 | 234,000 | 0 | 0 |
Balance, shares at Sep. 30, 2020 | 3 | 36,667 | 61,554,604 | ||||
Balance, amount at Sep. 30, 2020 | (15,607,000) | $ 987,000 | $ 4,000 | $ 6,000 | 31,468,000 | (47,265,000) | (807,000) |
Balance, shares at Dec. 31, 2020 | 3 | 36,667 | 718,263,338 | ||||
Balance, amount at Dec. 31, 2020 | $ (14,342,000) | $ 987,000 | $ 4,000 | $ 72,000 | 39,814,000 | (54,396,000) | (823,000) |
Fair value of common stock issued for services, shares | 45,150,500 | ||||||
Fair value of vested options | $ 6,387,000 | 0 | 0 | 0 | 6,387,000 | 0 | 0 |
Net loss | (15,842,000) | 0 | 0 | $ 0 | 0 | (15,805,000) | (37,000) |
Fair value of common stock issued for services, shares | 881,550 | ||||||
Fair value of common stock issued for services, amount | 66,000 | 0 | 0 | $ 0 | 66,000 | 0 | 0 |
Common stock issued upon conversion of debt settlement, shares | 460,829 | ||||||
Common stock issued upon conversion of debt settlement, amount | 88,000 | 0 | 0 | $ 0 | 88,000 | 0 | 0 |
Common stock issued for cash, shares | 119,666,450 | ||||||
Common stock issued for cash, amount | 5,368,000 | 0 | 0 | $ 12,000 | 5,356,000 | 0 | 0 |
Fair value of warrants issued for services | 0 | 0 | 0 | $ 0 | 0 | 0 | 0 |
Fair value of common stock issued as a financing cost, shares | 45,150,500 | ||||||
Fair value of common stock issued as a financing cost, amount | 6,569,000 | 0 | 0 | $ 5,000 | 6,564,000 | 0 | 0 |
Common stock issued upon cashless exercise of warrants, shares | 12,349,726 | ||||||
Common stock issued upon cashless exercise of warrants, amount | 0 | 0 | 0 | $ 1,000 | (1,000) | 0 | 0 |
Common stock issued upon cashless exercise of options, shares | 39,955,655 | ||||||
Common stock issued upon cashless exercise of options, amount | 3,000 | 0 | 0 | $ 3,000 | 0 | 0 | 0 |
Common stock issued upon conversion of notes and accrued interest, shares | 16,168,589 | ||||||
Common stock issued upon conversion of notes and accrued interest, amount | 1,035,000 | $ 0 | $ 0 | $ 2,000 | 1,033,000 | 0 | 0 |
Balance, shares at Sep. 30, 2021 | 3 | 36,667 | 952,896,637 | ||||
Balance, amount at Sep. 30, 2021 | (10,668,000) | $ 987,000 | $ 4,000 | $ 95,000 | 59,307,000 | (70,201,000) | (860,000) |
Balance, shares at Jun. 30, 2021 | 3 | 36,667 | 876,169,478 | ||||
Balance, amount at Jun. 30, 2021 | (12,428,000) | $ 987,000 | $ 4,000 | $ 88,000 | 56,701,000 | (69,368,000) | (840,000) |
Fair value of vested options | 0 | 0 | 0 | 0 | 0 | 0 | 0 |
Net loss | (853,000) | 0 | 0 | $ 0 | 0 | (833,000) | (20,000) |
Fair value of common stock issued for services, shares | 179,839 | ||||||
Fair value of common stock issued for services, amount | 9,000 | 0 | 0 | $ 0 | 9,000 | 0 | 0 |
Common stock issued for cash, shares | 53,800,000 | ||||||
Common stock issued for cash, amount | 2,601,000 | 0 | 0 | $ 5,000 | 2,596,000 | 0 | 0 |
Fair value of warrants issued for services | 0 | 0 | 0 | 0 | 0 | 0 | 0 |
Fair value of common stock issued as a financing cost, amount | 0 | 0 | 0 | $ 0 | 0 | ||
Common stock issued upon cashless exercise of options, shares | 22,747,320 | ||||||
Common stock issued upon cashless exercise of options, amount | 3,000 | 0 | 0 | $ 2,000 | 1,000 | 0 | 0 |
Common stock issued upon cashless exercise of warrants | 0 | $ 0 | $ 0 | $ 0 | 0 | ||
Balance, shares at Sep. 30, 2021 | 3 | 36,667 | 952,896,637 | ||||
Balance, amount at Sep. 30, 2021 | $ (10,668,000) | $ 987,000 | $ 4,000 | $ 95,000 | $ 59,307,000 | $ (70,201,000) | $ (860,000) |
CONDENSED CONSOLIDATED STATEM_3
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited) - USD ($) | 9 Months Ended | 12 Months Ended | ||
Sep. 30, 2021 | Sep. 30, 2020 | Dec. 31, 2020 | Dec. 31, 2019 | |
Cash flows from operating activities: | ||||
Net loss | $ (15,842,000) | $ (2,942,000) | $ (10,088,000) | $ (3,750,000) |
Adjustments to reconcile net loss to net cash used in operating activities: | ||||
Depreciation and amortization | 4,000 | 6,000 | 7,000 | 7,000 |
Amortization of discount | 52,000 | 587,000 | 605,000 | 1,047,000 |
Amortization of right-of-use asset | 38,000 | 36,000 | 49,000 | 47,000 |
Fair value of common stock issued for services | 69,000 | 20,000 | 39,000 | 0 |
Fair value of vested options | 6,387,000 | 216,000 | 506,000 | 21,000 |
Fair value of common stock issued for financing services | 6,569,000 | 0 | ||
Change in fair value of derivative liabilities | 219,000 | (165,000) | 1,190,000 | (311,000) |
Private placement costs | 0 | 140,000 | 173,000 | 803,000 |
Loss on extinguishment of debt | 286,000 | 223,000 | 4,841,000 | 134,000 |
Interest expense from debt settlement obligation | 0 | 49,000 | ||
Changes in operating assets and liabilities: | ||||
Accounts receivable | 8,000 | (3,000) | 0 | 1,000 |
Prepaid expenses | 10,000 | (18,000) | (17,000) | 0 |
Accounts payable and accrued expenses | 158,000 | (77,000) | 170,000 | |
Accrued interest | 205,000 | 399,000 | 562,000 | 490,000 |
Operating lease liability | (38,000) | (35,000) | (46,000) | (44,000) |
Net cash used in operating activities | (2,014,000) | (1,329,000) | (2,256,000) | (1,385,000) |
Cash flows from investing activities: | ||||
Purchases of property and equipment | 0 | 2,000 | (1,000) | (1,000) |
Net cash used in investing activities | 0 | (2,000) | (1,000) | (1,000) |
Cash flows from financing activities: | ||||
Proceeds from sale of common stock | 5,368,000 | 0 | 976,000 | 0 |
Proceeds from convertible notes payable | 0 | 689,000 | 803,000 | 985,000 |
Proceeds from notes payable | 177,000 | 543,000 | 673,000 | 315,000 |
Proceeds from notes payable-related parties | 0 | 263,000 | 263,000 | 0 |
Repayment of convertible note payable | 0 | 43,000 | (43,000) | 0 |
Repayment of notes payable | (224,000) | (184,000) | 274,000 | 48,000 |
Repayment of convertible notes payable-related parties | (30,000) | 0 | ||
Repayment of notes payable-related parties | (259,000) | (4,000) | (54,000) | 0 |
Proceeds from finance obligation | 0 | 123,000 | ||
Net cash provided by financing activities | 5,032,000 | 1,264,000 | 2,344,000 | 1,375,000 |
Net decrease in cash | 3,018,000 | (67,000) | 87,000 | (11,000) |
Cash at beginning of the period | 162,000 | 75,000 | 75,000 | 86,000 |
Cash at end of the period | 3,180,000 | 8,000 | 162,000 | 75,000 |
Supplemental disclosure of cash flow information: | ||||
Interest paid | 113,000 | 69,000 | 85,000 | 0 |
Income tax paid | 0 | 0 | 0 | 0 |
Supplemental disclosure of non-cash investing and financing transactions | ||||
Fair value of derivative upon issuance of convertible debt recorded as debt discount | 0 | 636,000 | 744,000 | 985,000 |
Right-of-use assets obtained in exchange for operating lease obligations | 0 | 253,000 | ||
Common stock issued for conversion of notes and accrued interest | 1,035,000 | 2,177,000 | 9,112,000 | 2,007,000 |
Convertible note, accrued interest, and accounts payable assumed by debt settlement obligation | 0 | 198,000 | 198,000 | 0 |
Common shares issued upon conversion of debt settlement | 88,000 | 333,000 | 459,000 | 0 |
Convertible note and accrued interest exchanged for common stock | 0 | 985,000 | 1,180,000 | 659,000 |
Warrants issued with convertible notes | $ 0 | $ 53,000 | ||
Notes payable and accrued interest exchanged for financing obligation | 0 | 315,000 | ||
Warrants issued with convertible notes accounted for as debt discount | $ 118,000 | $ 60,000 |
Organization and Summary of Sig
Organization and Summary of Significant Accounting Policies | 9 Months Ended | 12 Months Ended |
Sep. 30, 2021 | Dec. 31, 2020 | |
Organization and Summary of Significant Accounting Policies | ||
Note 1 - Organization and Summary of Significant Accounting Policies | Note 1 - Organization and Summary of Significant Accounting Policies StrikeForce Technologies, Inc. (the “Company”) is a software development and services company that offers a suite of integrated computer network security products using proprietary technology. The Company’s operations are based in Edison, New Jersey. Basis of Presentation - Unaudited Interim Financial Information The accompanying unaudited condensed consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”) for interim financial information and with the rules and regulations of the United States Securities and Exchange Commission (the “SEC”) to Form 10-Q and Article 8 of Regulation S-X. Accordingly, they do not include all of the information and footnotes required by U.S. GAAP for complete financial statements. In the opinion of management, all adjustments (consisting of normal recurring accruals) considered necessary for a fair presentation of the financial position, results of operations and cash flows for the interim periods have been included. The results of operations for the nine months ended September 30, 2021 are not necessarily indicative of the results of operations to be expected for the full fiscal year ending December 31, 2021. These financial statements should be read in conjunction with the financial statements of the Company for the year ended December 31, 2020 and notes thereto contained in the Annual Report on Form 10-K of the Company as filed with the SEC on April 13, 2021. The consolidated financial statements include the accounts of the Company and its subsidiary, BlockSafe Technologies, Inc. (“BST”). BST is owned 49% by the Company and 31% by three executive officers of the Company. BST meets the definition of a variable interest entity (“VIE”) and based on the determination that the Company is the primary beneficiary of BST, BST’s operating results, assets and liabilities are consolidated by the Company. Intercompany balances and transactions have been eliminated in consolidation. At September 30, 2021, noncontrolling interests represents 51% of BST that the Company does not directly own. The Company and BST have a management agreement pursuant to which BST shall remit a management fee of $36,000 per month to the Company, and when BST reaches a milestone of $1,000,000 in financing, an additional management fee of $5,000,000 shall be owed to the Company, payable monthly over three years. The management fee is currently eliminated in consolidation. At September 30, 2021 and December 31, 2020, the amount of VIE cash on the accompanying consolidated balance cash can be used only to settle obligations of BST, and the amounts of VIE accounts payable, VIE Notes Payable, VIE Accrued Interest, and VIE Financing Obligation have no recourse to the general credit of the Company. COVID-19 In March 2020, the World Health Organization declared coronavirus COVID-19 a global pandemic. This contagious disease outbreak, which has continued to spread, has adversely affected workforces, customers, economies, and financial markets globally. It has also disrupted the normal operations of many businesses. This outbreak could decrease spending, adversely affect demand for the Company’s products, and harm the Company’s business and results of operations. During the nine months ended September 30, 2021 and the year ended December 31, 2020, the Company believes the COVID-19 pandemic did impact its operating results. For the year ended December 31, 2020, sales to customers decreased by 73% as compared to the prior year. However, the Company has not observed any impairments of its assets or a significant change in the fair value of its assets due to the COVID-19 pandemic. At this time, it is not possible for the Company to predict the duration or magnitude of the adverse results of the outbreak and its effects on the Company’s business or results of operations, financial condition, or liquidity. The Company has been following the recommendations of health authorities to minimize exposure risk for its team members during the pandemic, including the temporary closure of its corporate office and having team members work remotely. During the second quarter of 2021, the Company reopened its corporate office while continuing to adhere to the guidelines issued by health authorities. Many customers and vendors have transitioned to electronic submission of invoices and payments. Reverse Split On June 25, 2020, the Company completed a 1:500 reverse stock split of its issued and outstanding shares of common stock and all fractional shares were rounded up. All share and per share amounts have been adjusted retroactively to reflect the reverse stock split as if it had occurred at the beginning of the earliest period presented. Going Concern The accompanying financial statements have been prepared on a going concern basis, which contemplates the realization of assets and the settlement of liabilities and commitments in the normal course of business. As reflected in the accompanying financial statements, for the nine months ended September 30, 2021, the Company incurred a net loss of $15,842,000 and used cash in operating activities of $2,014,000 and at September 30, 2021, the Company had a stockholders’ deficit of $10,668,000. Also, at September 30, 2021, the Company is in default on notes payable and convertible notes payable in the aggregate amount of $3,417,000. These factors, among others, raise substantial doubt about the Company’s ability to continue as a going concern within one year of the date that these financial statements are issued. In addition, the Company’s independent registered public accounting firm, in its report on the Company’s December 31, 2020 financial statements, raised substantial doubt about the Company’s ability to continue as a going concern. The accompanying financial statements do not include any adjustments that might be necessary if the Company is unable to continue as a going concern. At September 30, 2021, the Company had cash on hand in the amount of $3,180,000. Management estimates that the current funds on hand will be sufficient to continue operations through the next eighteen months. The Company’s ability to continue as a going concern is dependent upon its ability to continue to implement its business plan. Currently, management is attempting to increase revenues by selling through a channel of distributors, value added resellers, strategic partners and original equipment manufacturers. While the Company believes in the viability of its strategy to increase revenues, there can be no assurances to that effect. The Company’s ability to continue as a going concern is dependent upon its ability to increase its customer base and realize increased revenues. No assurance can be given that any future financing, if needed, will be available or, if available, that it will be on terms that are satisfactory to the Company. Even if the Company is able to obtain additional financing, if needed, it may contain undue restrictions on its operations, in the case of debt financing, or cause substantial dilution for its stockholders, in the case of equity financing. Use of Estimates The preparation of financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Significant estimates include those related to accounting for financing obligations, assumptions used in valuing stock instruments issued for services, assumptions used in valuing derivative liabilities, the valuation allowance for deferred tax assets, and the accrual of potential liabilities. Actual results could differ from those estimates. Revenue Recognition The Company follows the guidance of Accounting Standards Codification (ASC) 606, Revenue from Contracts with Customers The Company’s revenue consists of revenue from sales and support of our software products. Revenue primarily consists of sales of software licenses of our ProtectID®, GuardedID®, MobileTrust® and SafeVchat™ products. The Company usually recognizes subscription revenue over a one-month period based on a typical monthly renewal cycle in accordance with its customer agreement terms. For service contracts, the Company’s performance obligations are satisfied, and the related revenue is recognized, as services are rendered. The Company offers no discounts, rebates, rights of return, or other allowances to clients which would result in the establishment of reserves against service revenue. Additionally, to date, the Company has not incurred incremental costs in obtaining customer contracts. Cost of revenue includes direct costs and fees related to the sale of our products. The following tables present our revenue disaggregated by major product and service lines: Three months ended September 30, September 30, 2020 Software $ 39,000 $ 49,000 Service 1,000 2,000 Total revenue $ 40,000 $ 51,000 Nine months ended September 30, September 30, 2020 Software $ 148,000 $ 156,000 Service 5,000 6,000 Total revenue $ 153,000 $ 162,000 Fair Value of Financial Instruments The Company follows the authoritative guidance issued by the Financial Accounting Standards Board (“FASB”) for fair value measurements. Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants at the measurement date. A fair value hierarchy was established, which prioritizes the inputs used in measuring fair value into three broad levels as follows: Level 1—Quoted prices in active markets for identical assets or liabilities. Level 2—Inputs, other than the quoted prices in active markets, that are observable either directly or indirectly. Level 3—Unobservable inputs based on the Company's assumptions. The Company is required to use of observable market data if such data is available without undue cost and effort. The Company believes the carrying amounts reported in the balance sheet for accounts receivable, accounts payable, accrued expenses, convertible notes, and notes payables approximate fair values because of the short-term nature of these financial instruments. As of December 31, 2020, the Company’s balance sheet included Level 2 liabilities comprised of the fair value of embedded derivative liabilities of $163,000 (see Note 8). Derivative Financial Instruments The Company evaluates its financial instruments to determine if such instruments are derivatives or contain features that qualify as embedded derivatives. For derivative financial instruments that are accounted for as liabilities, the derivative instrument is initially recorded at its fair value and is then re-valued at each reporting date, with changes in the fair value reported in the statements of operations. The Company evaluates embedded conversion features within its convertible debt to determine whether the embedded conversion features should be bifurcated from the host instrument and accounted for as a derivative. The fair value of the embedded derivatives are determined using Monte Carlo simulation method at inception and on subsequent valuation dates. The classification of derivative instruments, including whether such instruments should be recorded as liabilities or as equity, is evaluated at the end of each reporting period. Stock-Based Compensation The Company periodically issues stock options, warrants, and shares of common stock as share-based compensation to employees and non-employees in non-capital raising transactions for services and for financing costs. The Company accounts for such grants issued and vesting based on FASB ASC 718, Compensation – Stock Compensation The fair value of the Company’s stock options and warrants are estimated using the Black-Scholes-Merton Option Pricing model, which uses certain assumptions related to risk-free interest rates, expected volatility, expected life of the stock options or restricted stock, and future dividends. Compensation expense is recorded based upon the value derived from the Black-Scholes-Merton Option Pricing model and based on actual experience. The assumptions used in the Black-Scholes-Merton Option Pricing model could materially affect compensation expense recorded in future periods. Loss per Share Basic loss per share is computed by dividing net loss available to common stockholders by the weighted average number of common shares outstanding during the period. Diluted loss per share is computed by dividing net loss applicable to common stockholders by the weighted average number of common shares outstanding, plus the number of additional common shares that would have been outstanding if all dilutive potential common shares had been issued using the treasury stock method. Diluted loss per share excludes all potential common shares if their effect is anti-dilutive. The following potentially dilutive shares were excluded from the shares used to calculate diluted earnings per share as their inclusion would be anti-dilutive: Concentrations For the nine months ended September 30, 2021, sales to three customers comprised 35%, 35% and 17% of revenues, respectively. For the nine months ended September 30, 2020, sales to two customers comprised 72% and 14% of revenues, respectively. At September 30, 2021, two customers comprised 63% and 12% of accounts receivable, respectively. The Company maintains the majority of its cash balances with one financial institution, in the form of demand deposits. At September 30, 2021, the Company had cash deposits that exceeded the federally insured limit of $250,000 per account. The Company believes that no significant concentration of credit risk exists with respect to its cash balances because of its assessment of the creditworthiness and financial viability of the financial institution. Segments The Company operates in one segment for the development and distribution of our software products. In accordance with the “Segment Reporting” Topic of the ASC, the Company’s chief operating decision maker has been identified as the Chief Executive Officer and President, who reviews operating results to make decisions about allocating resources and assessing performance for the entire Company. Existing guidance, which is based on a management approach to segment reporting, establishes requirements to report selected segment information quarterly and to report annually entity-wide disclosures about products and services, major customers, and the countries in which the entity holds material assets and reports revenue. All material operating units qualify for aggregation under “Segment Reporting” due to their similar customer base, single sales team, marketing department, customer service department, operations department, finance and accounting department to support its operations and similarities in: economic characteristics; nature of products and services; and procurement, manufacturing and distribution processes. Since the Company operates in one segment, all financial information required by “Segment Reporting” can be found in the accompanying financial statements. Recent Accounting Pronouncements In June 2016, the FASB issued ASU No. 2016-13, Credit Losses - Measurement of Credit Losses on Financial Instruments In August 2020, the FASB issued ASU No. 2020-06, Debt—Debt with Conversion and Other Options (Subtopic 470-20) and Derivatives and Hedging—Contracts in Entity’s Own Equity (Subtopic 815-40): Accounting for Convertible Instruments and Contracts in an Entity’s Own Equity. In May 2021, the FASB issued ASU 2021-04, Earnings Per Share (Topic 260), Debt—Modifications and Extinguishments (Subtopic 470-50), Compensation—Stock Compensation (Topic 718), and Derivatives and Hedging—Contracts in Entity’s Own Equity (Subtopic 815-40): Issuer’s Accounting for Certain Modifications or Exchanges of Freestanding Equity-Classified Written Call Options Other recent accounting pronouncements issued by the FASB, including its Emerging Issues Task Force, the American Institute of Certified Public Accountants, and the Securities and Exchange Commission did not or are not believed by management to have a material impact on the Company's present or future consolidated financial statements. | Note 1 - Organization and Summary of Significant Accounting Policies StrikeForce Technologies, Inc. (the “Company”) is a software development and services company that offers a suite of integrated computer network security products using proprietary technology. The Company’s operations are based in Edison, New Jersey. Going Concern The accompanying consolidated financial statements have been prepared on a going concern basis, which contemplates the realization of assets and the settlement of liabilities and commitments in the normal course of business. As reflected in the accompanying financial statements, for the year ended December 31, 2020, the Company incurred a net loss of $10,088,000 and used cash in operating activities of $2,256,000, and at December 31, 2020, the Company had a stockholders’ deficit of $14,342,000. Also, at December 31, 2020, the Company is in default on notes payable and convertible notes payable in the aggregate amount of $3,604,000. These factors raise substantial doubt about the Company’s ability to continue as a going concern within one year of the date that these financial statements are issued. The consolidated financial statements do not include any adjustments that might be necessary if the Company is unable to continue as a going concern. At December 31, 2020, the Company had cash on hand in the amount of $162,000. Subsequent to December 31, 2020, the Company sold subscriptions for $1,525,000 and issued 38,116,450 shares of its common stock in an offering under Regulation A and received one SBA Paycheck Protection assistance loan for $177,000. Management estimates that the current funds on hand will be sufficient to continue operations through the next six months. The Company’s ability to continue as a going concern is dependent upon its ability to continue to implement its business plan. Currently, management is attempting to increase revenues by selling through a channel of distributors, value added resellers, strategic partners and original equipment manufacturers. While the Company believes in the viability of its strategy to increase revenues, there can be no assurances to that effect. The Company’s ability to continue as a going concern is dependent upon its ability to increase its customer base and realize increased revenues. No assurance can be given that any future financing, if needed, will be available or, if available, that it will be on terms that are satisfactory to the Company. Even if the Company is able to obtain additional financing, if needed, it may contain undue restrictions on its operations, in the case of debt financing, or cause substantial dilution for its stockholders, in the case of equity financing. Basis of presentation and principles of consolidation The accompanying consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America. The consolidated financial statements include the accounts of the Company and its subsidiary, BlockSafe Technologies, Inc. (“BST”). BST is owned 49% by the Company and 31% by three executive officers of the Company. BST meets the definition of a variable interest entity (“VIE”) and based on the determination that the Company is the primary beneficiary of BST. BST’s operating results, assets and liabilities are consolidated by the Company. Intercompany balances and transactions have been eliminated in consolidation. At December 31, 2020, noncontrolling interests represents 51% of BST that the Company does not directly own. The Company and BST have a management agreement pursuant to which BST shall remit a management fee of $36,000 per month to the Company, and when BST reaches a milestone of $1,000,000 in financing, an additional management fee of $5,000,000 shall be owed to the Company, payable monthly over three years. The management fee is eliminated in consolidation. At December 31, 2020 and 2019, the amount of VIE cash on the accompanying consolidated balance sheets can be used only to settle obligations of BST, and the amounts of VIE accounts payable, VIE Notes Payable, VIE Accrued Interest, and VIE Financing Obligation have no recourse to the general credit of the Company. Reverse Stock Split On June 25, 2020, the Company completed a 1:500 reverse stock split of the Company’s issued and outstanding shares of common stock and all fractional shares were rounded up. All share and per share amounts in the accompanying financial statements have been adjusted retroactively to reflect the reverse stock split as if it had occurred at the beginning of the earliest period presented. COVID-19 In March 2020, the World Health Organization declared coronavirus COVID-19 a global pandemic. This contagious disease outbreak, which has continued to spread, has adversely affected workforces, customers, economies, and financial markets globally. It has also disrupted the normal operations of many businesses. This outbreak could decrease spending, adversely affect demand for the Company’s products, and harm the Company’s business and results of operations. During the year ended December 31, 2020, the Company believes the COVID-19 pandemic did impact its operating results as sales to customers were down 73% as compared from the year ended December 31, 2019. However, the Company has not observed any impairments of its assets or a significant change in the fair value of its assets due to the COVID-19 pandemic. At this time, it is not possible for the Company to predict the duration or magnitude of the adverse results of the outbreak and its effects on the Company’s business or results of operations, financial condition, or liquidity. The Company has been following the recommendations of health authorities to minimize exposure risk for its team members, including the temporary closure of its corporate office and having team members work remotely. Most customers and vendors have transitioned to electronic submission of invoices and payments. Use of Estimates The preparation of financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Significant estimates include those related to accounting for financing obligations, assumptions used in valuing stock instruments issued for services, assumptions used in valuing derivative liabilities, the valuation allowance for deferred tax assets, and the accrual of potential liabilities. Actual results could differ from those estimates. Revenue Recognition The Company follows the guidance of Accounting Standards Codification (ASC) 606, Revenue from Contracts with Customers The Company’s revenue consists of revenue from sales and support of our software products. Revenue primarily consists of sales of software licenses of our ProtectID®, GuardedID® and MobileTrust® products. The Company usually recognizes subscription revenue over a one-month period based on a typical monthly renewal cycle in accordance with its customer agreement terms. For service contracts, the Company’s performance obligations are satisfied, and the related revenue is recognized, as services are rendered. The Company offers no discounts, rebates, rights of return, or other allowances to clients which would result in the establishment of reserves against service revenue. Additionally, to date, the Company has not incurred incremental costs in obtaining customer contracts. Cost of revenue includes direct costs and fees related to the sale of our products. The following tables present our revenue disaggregated by major product and service lines: Year ended December 31, December 31, 2019 Software $ 200,000 $ 764,000 Service 7,000 4,000 Total revenue $ 207,000 $ 768,000 Accounts Receivable Accounts receivable consist of trade amounts due from customers, and are recorded at invoiced amounts. The Company maintains an allowance for doubtful accounts receivable based upon our business customers’ financial condition and payment history, and our historical collection experience and expected collectability of accounts receivable. In circumstances where the Company becomes aware of a specific customer’s inability to meet its financial obligations to the Company, a specific reserve for bad debts is estimated and recorded. At December 31, 2020 and 2019, the allowance for doubtful accounts was $20,000 and $20,000, respectively. Property and Equipment Property and equipment are recorded at cost less accumulated depreciation and amortization. Property and equipment are depreciated using the straight-line method over the estimated useful lives of the related assets as follows: Estimated Useful Life (Years) Computer equipment 5 Computer software 3 Furniture and fixture 7 Office equipment 7 Expenditures for major additions and betterments are capitalized. Maintenance and repairs are charged to operations as incurred. Upon sale or retirement of property and equipment, the related cost and accumulated depreciation are removed from the accounts and any gain or loss is reflected in the statements of operations. Management assesses the carrying value of property and equipment whenever events or changes in circumstances indicate that the carrying value may not be recoverable. If there is indication of impairment, management prepares an estimate of future cash flows expected to result from the use of the asset and its eventual disposition. If these cash flows are less than the carrying amount of the asset, an impairment loss is recognized to write down the asset to its estimated fair value. For the years ended December 31, 2020 and 2019, the Company did not recognize any impairment for its property and equipment. Impairment of Long-lived Assets The Company reviews its property and equipment, right-of-use assets, and other long-lived assets, including intangible assets other than goodwill, for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset group may not be recoverable. Recoverability is measured by a comparison of the carrying amount of an asset to the estimated undiscounted future cash flows expected to be generated by the asset. If the carrying amount of an asset exceeds its estimated undiscounted future cash flows, an impairment charge is recognized by the amount by which the carrying amount of the asset exceeds the fair value of the assets. Fair value is generally determined using the asset’s expected future discounted cash flows or market value, if readily determinable. For the years ended December 31, 2020 and 2019, the Company had no impairment of long-lived assets. Income Taxes The Company accounts for income taxes using the asset and liability method whereby deferred tax assets are recognized for deductible temporary differences, and deferred tax liabilities are recognized for taxable temporary differences. Temporary differences are the differences between the reported amounts of assets and liabilities and their tax bases. Deferred tax assets are reduced by a valuation allowance when, in the opinion of management, it is more likely than not that some portion or all of the deferred tax assets will be realized. Deferred tax assets and liabilities are adjusted for the effects of changes in tax laws and rates on the date of enactment. Leases We lease our corporate office space under a lease agreement with monthly payments over a period of 60 months. Pursuant to ASC 840, Leases, lease assets are presented as operating lease right-of-use assets and the related liabilities are presented as lease liabilities in our consolidated balance sheets (see Note 11). Fair Value of Financial Instruments The Company follows the authoritative guidance issued by the Financial Accounting Standards Board (“FASB”) for fair value measurements. Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants at the measurement date. A fair value hierarchy was established, which prioritizes the inputs used in measuring fair value into three broad levels as follows: Level 1—Quoted prices in active markets for identical assets or liabilities. Level 2—Inputs, other than the quoted prices in active markets, that are observable either directly or indirectly. Level 3—Unobservable inputs based on the Company’s assumptions. The Company is required to use of observable market data if such data is available without undue cost and effort. The Company believes the carrying amounts reported in the balance sheet for accounts receivable, accounts payable, accrued expenses, convertible notes, and notes payables approximate fair values because of the short-term nature of these financial instruments. As of December 31, 2020 and 2019, the Company’s balance sheet includes Level 2 liabilities comprised of the fair value of embedded derivative liabilities of $163,000 and $1,516,000, respectively (see Note 10). Derivative Financial Instruments The Company evaluates its financial instruments to determine if such instruments are derivatives or contain features that qualify as embedded derivatives. For derivative financial instruments that are accounted for as liabilities, the derivative instrument is initially recorded at its fair value and is then re-valued at each reporting date, with changes in the fair value reported in the statements of operations. The Company evaluates embedded conversion features within its convertible debt to determine whether the embedded conversion features should be bifurcated from the host instrument and accounted for as a derivative. The fair value of the embedded derivatives are determined using Monte Carlo simulation method at inception and on subsequent valuation dates. The classification of derivative instruments, including whether such instruments should be recorded as liabilities or as equity, is evaluated at the end of each reporting period. Stock-Based Compensation The Company periodically issues stock options, warrants, and shares of common stock as share-based compensation to employees and non-employees in non-capital raising transactions for services and for financing costs. The Company accounts for such grants issued and vesting based on FASB ASC 718, Compensation – Stock Compensation The fair value of the Company’s stock options and warrants are estimated using the Black-Scholes-Merton Option Pricing model, which uses certain assumptions related to risk-free interest rates, expected volatility, expected life of the stock options or restricted stock, and future dividends. Compensation expense is recorded based upon the value derived from the Black-Scholes-Merton Option Pricing model and based on actual experience. The assumptions used in the Black-Scholes-Merton Option Pricing model could materially affect compensation expense recorded in future periods. Loss per Share Basic loss per share is computed by dividing net loss available to common stockholders by the weighted average number of common shares outstanding during the period. Diluted loss per share is computed by dividing net loss applicable to common stockholders by the weighted average number of common shares outstanding, plus the number of additional common shares that would have been outstanding if all dilutive potential common shares had been issued using the treasury stock method. Diluted loss per share excludes all potential common shares if their effect is anti-dilutive. The following potentially dilutive shares were excluded from the shares used to calculate diluted earnings per share as their inclusion would be anti-dilutive: Year ended December 31, 2020 December 31, 2019 Options to purchase common stock 58,133,001 633,001 Warrants to purchase common stock 27,405,476 100,574 Convertible notes 1,156,304 1,554,866 Convertible Series B Preferred stock 791,170 31,548 Total 87,485,950 2,319,989 Advertising, Sales and Marketing Costs Advertising, sales and marketing costs are expensed as incurred and are included in sales and marketing expenses. For the years ended December 31, 2020 and 2019, advertising, sales and marketing expenses were $2,000 and $8,000, respectively. Research and Development Costs Costs incurred for research and development are expensed as incurred. The salaries, benefits, and overhead costs of personnel conducting research and development of the Company’s software products comprise research and development expenses. Purchased materials that do not have an alternative future use are also expensed. Concentrations For the year ended December 31, 2020, sales to two customers comprised 72% and 15% of revenues, respectively. For the year ended December 31, 2019, sales to three customers comprised 58%, 21% and 14% of revenues, respectively. At December 31, 2020, three customers comprised 50%, 24% and 10% of accounts receivable, respectively. At December 31, 2019, three customers comprised 43%, 29% and 12% of accounts receivable, respectively. The Company maintains the majority of its cash balances with one financial institution, in the form of demand deposits. At December 31, 2020, the Company did not have cash deposits that exceeded the federally insured limit of $250,000 per account. The Company believes that no significant concentration of credit risk exists with respect to its cash balances because of its assessment of the creditworthiness and financial viability of the financial institution. Segments The Company operates in one segment for the development and distribution of our software products. In accordance with the “Segment Reporting” Topic of the ASC, the Company’s chief operating decision maker has been identified as the Chief Executive Officer and President, who reviews operating results to make decisions about allocating resources and assessing performance for the entire Company. Existing guidance, which is based on a management approach to segment reporting, establishes requirements to report selected segment information quarterly and to report annually entity-wide disclosures about products and services, major customers, and the countries in which the entity holds material assets and reports revenue. All material operating units qualify for aggregation under “Segment Reporting” due to their similar customer base and similarities in: economic characteristics; nature of products and services; and procurement, manufacturing and distribution processes. Since the Company operates in one segment, all financial information required by “Segment Reporting” can be found in the accompanying financial statements. Recent Accounting Pronouncements In June 2016, the FASB issued ASU No. 2016-13, Credit Losses - Measurement of Credit Losses on Financial Instruments In August 2020, the FASB issued ASU No. 2020-06, Debt—Debt with Conversion and Other Options (Subtopic 470-20) and Derivatives and Hedging—Contracts in Entity’s Own Equity (Subtopic 815-40): Accounting for Convertible Instruments and Contracts in an Entity’s Own Equity. Other recent accounting pronouncements issued by the FASB, including its Emerging Issues Task Force, the American Institute of Certified Public Accountants, and the Securities and Exchange Commission did not or are not believed by management to have a material impact on the Company’s present or future consolidated financial statements. |
Property and Equipment
Property and Equipment | 12 Months Ended |
Dec. 31, 2020 | |
Property and Equipment | |
Note 2 - Property and Equipment | Note 2 - Property and Equipment Property and equipment, stated at cost, less accumulated depreciation consisted of the following: December 31, 2020 December 31, 2019 Computer equipment $ 82,000 $ 82,000 Computer software 44,000 43,000 Furniture and fixtures 10,000 10,000 Office equipment 17,000 17,000 153,000 152,000 Less accumulated depreciation (151,000 ) (147,000 ) $ 2,000 $ 5,000 Depreciation expense for the years ended December 31, 2020 and 2019 was $4,000 and $5,000, respectively. |
Convertible Notes Payable
Convertible Notes Payable | 9 Months Ended | 12 Months Ended |
Sep. 30, 2021 | Dec. 31, 2020 | |
Convertible Notes Payable | ||
Note 2 - Convertible Notes Payable | Note 2 - Convertible Notes Payable Convertible notes payable consisted of the following: September 30, 2021 December 31, 2020 Secured (a) AL-Bank, in default $ 543,000 $ 543,000 Unsecured (b) Convertible notes with fixed conversion prices, in default 895,000 895,000 (c) Convertible notes with adjustable conversion prices - 45,000 Total convertible notes principal outstanding 1,438,000 1,483,000 Debt discount - (14,000 ) Convertible notes, net of discount $ 1,438,000 $ 1,469,000 (a) During fiscal 2005, the Company issued notes payable to DART/Citco Global in the aggregate of $543,000. The notes bear interest at an average rate of 7.5% per annum, matured in December 2010, convertible to common shares at a fixed conversion price of $3.25 per share, as adjusted for applicable reverse stock splits, and secured by all of the Company’s assets. In fiscal 2009, the note holders agreed to the forbearance of any interest on the notes payable to DART/Citco Global. In August 2021, the notes were assigned to Aktieselskabet Arbejdernes Landsbank (“AL-Bank”), a financing institution based in Denmark. In September 2021, the Company executed a repayment agreement with AL-Bank whereby the Company shall make monthly payments of $10,000 to AL-Bank, starting in October 2021 and ending in January 2025, for a total of $400,000. Once the payments are made in full in accordance with the repayment agreement, the remaining balance of $143,000 shall be forgiven and will be accounted at that time. At September 30, 2021 and December 31, 2020, the outstanding balance of convertible notes payable amounted to $543,000, respectively and in default. (b) During fiscals 2005 through 2007, the Company issued notes payable in the aggregate of $895,000. The notes are unsecured, bear interest at a rate starting at 8% up to 18% per annum, were due on various dates from March 2008 to March 2015, and are currently in default. The aggregate notes are convertible into less than one share of the Company’s common stock based on fixed conversion prices adjusted for applicable reverse stock splits. At September 30, 2021 and December 31, 2020, the outstanding balance of convertible notes payable amounted to $895,000, respectively and in default. (c) During fiscal 2020, the Company issued convertible notes payable with adjustable conversion prices for aggregate proceeds of $803,000. The notes bear interest at 8% to 10% per annum, unsecured, and maturing between October 2020 and December 2021. At the option of the holder, the notes are convertible into shares of common stock of the Company at a price per share discount of 58% to 70% of the market price of the Company’s common stock, as defined, for 15 to 25 days preceding a conversion notice. The Company determined that the conversion options of the convertible notes were not considered indexed to the Company’s own stock and characterized the conversion features as derivative liabilities upon issuance (see Note 10). The Company also granted warrants to certain note holders to purchase 638,000 shares of the Company’s common stock. As a result, the Company recorded debt discount of $803,000, to account the fair value of the derivative liabilities of $742,000, the relative fair value of the warrants granted of $53,000 and direct fees incurred of $8,000. At December 31, 2020, the outstanding balance of the notes payable amounted to $45,000 and unamortized discount was $14,000. During the nine months ended September 30, 2021, the remaining notes payable of $45,000 plus unpaid interest and fees of $4,000, for a total of $49,000, were converted into 16,168,589 shares of the Company’s common stock with a fair value of $1,035,000. The Company followed the general extinguishment model to record the conversion and settlement of the debt. Notes payable, accrued interest and fees converted totaled $49,000, the related unamortized debt discount totaled ($14,000), and the derivative liability related to the conversion option of these notes, after final valuation, amounted to $382,000. The fair value of the common shares issued amounted to $1,035,000 and the difference between the total debt settled and fair value of the common shares issued amounted to $618,000 and was recorded as loss on extinguishment of debt. At September 30, 2021, the Company had no more convertible notes with adjustable conversion prices outstanding. | Note 3 - Convertible Notes Payable Convertible notes payable consisted of the following: December 31, 2020 December 31, 2019 Secured (a) Convertible notes due to DART/Citco, in default $ 543,000 $ 543,000 Unsecured (b) Convertible notes with fixed conversion features, in default 895,000 895,000 (c) Convertible notes with adjustable conversion features, $20,000 in default at December 31, 2020 45,000 845,000 Total convertible notes principal outstanding 1,483,000 2,283,000 Debt discount (14,000 ) (423,000 ) Convertible notes, net of discount $ 1,469,000 $ 1,860,000 (a) During fiscal 2005, the Company issued notes payable to DART/Citco Global in the aggregate of $543,000. The notes bear interest at an average rate of 7.5% per annum, matured in December 2010, convertible to common shares at a fixed conversion price of $3.25 per share, as adjusted for applicable reverse stock splits, and secured by all of the Company’s assets. In fiscal 2009, the note holders agreed to the forbearance of any interest on the notes payable to DART/Citco Global. (b) During fiscals 2005 through 2007, the Company issued notes payable in the aggregate of $895,000. The notes are unsecured, bear interest at a rate starting at 8% up to 18% per annum, were due on various dates from March 2008 to March 2015, and are currently in default. The aggregate notes are convertible into less than one share of the Company’s common stock based on fixed conversion prices adjusted for applicable reverse stock splits. At December 31, 2020 and 2019, outstanding balance of convertible notes payable amounted to $895,000, respectively. (c) In fiscal 2018, the Company issued unsecured convertible notes payable, bearing interest at rate of 10% per annum, and maturing through December 2019. At the option of the holder, the notes are convertible into shares of common stock of the Company at a price per share discount of 58% of the lowest closing market price of the Company’s common stock during the twenty days preceding a conversion notice. The Company determined that the conversion options of the convertible notes were not considered indexed to the Company’s own stock and characterized the fair value of the conversion features as derivative liabilities upon issuance (see Note 10) and recorded as a debt discount and is being amortized over the term of the notes payable. As of December 31, 2018, outstanding balance of the notes payable amounted to $695,000 and unamortized debt discount of $522,000. During the year ended December 31, 2019, the Company issued similar convertible notes payable with adjustable conversion features for aggregate proceeds of $985,000. The notes bear interest at a rate of 8% to 10% per annum, unsecured, and matured in January 2020 and November 2020. At the option of the holder, the notes are convertible into shares of common stock of the Company at a price per share discount of 58% to 62% of the market price of the Company’s common stock, as defined, for 15 to 25 days preceding a conversion notice. The Company determined that the conversion options of the convertible notes were not considered indexed to the Company’s own stock and characterized the fair value of the conversion features as derivative liabilities upon issuance with a fair value of $1,728,000, of which $925,000 was recorded as debt discount, and the remainder of $803,000 was recorded as private placement costs. In addition, certain convertible notes were issued with warrants to purchase 100,575 shares of the Company’s common stock at prices ranging from $0.75 to $2.90 per share, adjusted for applicable reverse stock splits (see Note 12). The Company calculated the relative fair value of the warrants to be $60,000 using a Black Scholes option-pricing model, and was recorded as a debt discount. As a result, the Company recorded total debt discount of $985,000 at issuance to account the fair value of the derivative liabilities of $925,000 and the relative fair value of the warrants of $60,000. During 2019, the Company recorded debt discount amortization of $851,000. In addition, convertible notes payable totaling $835,000 plus interest of $57,000, for a total of $892,000 were converted into 1,157,829 shares of common stock. The Company followed the general extinguishment model to record the conversion and settlement of the debt. Notes payable and accrued interest converted totaled $892,000, the related unamortized debt discount totaled ($233,000), and the derivative liability related to the conversion option of these notes, after final valuation, amounted to $1,214,000. The fair value of the common shares issued amounted to $2,007,000 and the difference between the total debt settled and fair value of the common shares issued amounted to $134,000 and was recorded as loss on extinguishment of debt. At December 31, 2019, outstanding balance of convertible notes amounted to $845,000 and the unamortized discount was $423,000. During the year ended December 31, 2020, the Company issued similar convertible notes payable with adjustable conversion prices for aggregate proceeds of $803,000. The notes bear interest at 8% to 10% per annum, unsecured, and maturing between October 2020 and December 2021. At the option of the holder, the notes are convertible into shares of common stock of the Company at a price per share discount of 58% to 70% of the market price of the Company’s common stock, as defined, for 15 to 25 days preceding a conversion notice. The Company determined that the conversion options of the convertible notes were not considered indexed to the Company’s own stock and characterized the conversion features as derivative liabilities upon issuance with a fair value of $917,000 (see Note 10), of which $742,000 was recorded as debt discount to be amortized over the term of the related notes, and the remainder of $175,000 was recorded as private placement costs. The Company also granted warrants to certain note holders to purchase 638,000 shares of the Company’s common stock (see Note 12). The Company determined the relative fair value of the warrants to be $53,000, and was recorded as debt discount to be amortized over the term of the related note. As a result, the Company recorded total debt discount of $803,000, to account the fair value of the derivative liabilities of $742,000, the relative fair value of the warrants granted of $53,000 and direct fees incurred of $8,000. During 2020, the Company recorded debt discount amortization of $598,000. In addition, notes payable totaling $1,088,000 plus unpaid interest and fees of $93,000, for a total of $1,181,000, were converted into 233,748,884 shares of the Company’s common stock. Notes payable in the aggregate of $472,000 and accrued interest of $34,000 for a total of $506,000 were also cancelled and forgiven by certain noteholders. The Company followed the general extinguishment model to record the conversion and settlement of the debt. Notes payable, accrued interest and fees converted and cancelled totaled $1,687,000, the related unamortized debt discount totaled ($614,000), and the derivative liability related to the conversion option of these notes, after final valuation, amounted to $3,249,000. The fair value of the common shares issued amounted to $9,112,000 and the difference between the total debt settled and fair value of the common shares issued amounted to $4,790,000 and was recorded as loss on extinguishment of debt. At December 31, 2020, the outstanding balance of the notes payable amounted to $45,000 and unamortized discount was $14,000. |
Convertible Notes Payable Relat
Convertible Notes Payable Related Parties | 9 Months Ended | 12 Months Ended |
Sep. 30, 2021 | Dec. 31, 2020 | |
Convertible Notes Payable Related Parties | ||
Note 3 - Convertable Notes Payable - Related Parties | Note 3 - Convertible Notes Payable – Related Parties In previous years, the Company issued convertible notes to related parties/officers in exchange for cash and/or services rendered. The notes are unsecured and are due on December 31, 2021, as amended. Certain notes payable are due to the Company’s Chief Executive Officer and have a compounded interest rate of 8% per annum. The aggregate notes are convertible into less than one share of the Company’s common stock at fixed conversion prices adjusted for applicable reverse stock splits. As of December 31, 2020, the outstanding balance of the notes payable amounted to $298,000. During the nine months ended September 30, 2021, notes payable aggregating $30,000 were repaid. At September 30, 2021, the balance of convertible notes payable-related parties totaled $268,000. | Note 4 - Convertible Notes Payable – Related Parties In previous years, the Company issued convertible notes to related parties/officers in exchange for cash and/or services rendered. The notes are unsecured and were due on December 31, 2020. As of December 31, 2018 and 2019, outstanding balance of the notes payable amounted to $356,000, respectively. During the year ended December 31, 2020, two notes aggregating $58,000 held by the Company’s VP of Technology were extinguished as part of a debt settlement obligation transaction (see Note 9). In addition, noteholders also agreed to extend the maturity date to December 31, 2021 with no changes to the other terms of the notes payable. At December 31, 2020, the balance of convertible notes payable-related parties totaled $298,000. The notes are made up of ten convertible note payables, are unsecured, and have extended due dates of December 31, 2021. Six notes totaling $268,000 are due to the Company’s Chief Executive Officer, at a compounded interest rate of 8% per annum; and four notes totaling $30,000 are due to the spouse of the Company’s Chief Technology Officer at a compounded interest rate of 8% per annum. The aggregate notes are convertible into less than one share of the Company’s common stock at fixed conversion prices adjusted for applicable reverse stock splits. |
Notes Payable
Notes Payable | 9 Months Ended | 12 Months Ended |
Sep. 30, 2021 | Dec. 31, 2020 | |
Notes Payable | ||
Note 4 - Notes Payable | Note 4 - Notes Payable Notes payable consisted of the following: September 30, 2021 December 31, 2020 Unsecured notes (a) Notes payable-in default $ 1,639,000 $ 1,699,000 (b) Notes payable issued by BST-in default 310,000 475,000 (c) Note payable-PPP loans 177,000 313,000 (d) Note payable-EID loan 150,000 150,000 Secured notes payable (e) Notes payable-in default 29,000 128,000 Total notes payable principal outstanding 2,305,000 2,765,000 Debt discount - (52,000 ) Less current portion of notes payable, net of discount (1,978,000 ) (2,250,000 ) Long term notes payable $ 327,000 $ 463,000 (a) In previous years, the Company issued notes payable in exchange for cash. The notes are unsecured, bear interest at a rate of 8% through 14% per annum and matured starting in fiscal 2011 up to November 2021. As of December 31, 2020, the outstanding balance of these notes payable amounted to $1,699,000 and unamortized debt discount of $52,000. During the nine months ended September 30, 2021, $60,000 of the notes were paid and the Company amortized the debt discount of $52,000. At September 30, 2021, the outstanding balance of the notes payable was $1,639,000 and deemed in default. (b) In fiscal 2018, the Company’s consolidated subsidiary BlockSafe, issued promissory notes in exchange for cash. The notes are unsecured, bearing interest at a rate of 8% per annum, and matured in September 2019. At December 31, 2020, the outstanding balance of the notes payable amounted to $475,000. During the nine months ended September 30, 2021, $65,000 of the notes were paid, and a note holder agreed to exchange $100,000 of notes payable for 460,829 shares of the Company’s common stock with a fair value of $88,000 (see Note 10). As a result, the Company recognized a gain on extinguishment of debt of $12,000 to account the difference between the note payable settled and fair value of the common stock issued. At September 30, 2021, the outstanding balance of the notes payable amounted to $310,000 and are deemed in default. (c) On April 7, 2020, the Company was granted a loan (the “PPP loan”) of $313,000, pursuant to the Paycheck Protection Program (the “PPP”) under the CARES Act. The PPP loan matures on April 7, 2022, bears interest at a rate of 1% per annum, with the first nine months of interest deferred, is payable monthly commencing on October 2020, and was unsecured and guaranteed by the U.S. Small Business Administration (“SBA”). The loan term may be extended to April 7, 2025, if mutually agreed to by the Company and lender. The PPP loan may be prepaid at any time prior to maturity with no prepayment penalties. Funds from the PPP loan may only be used for qualifying expenses as described in the CARES Act, including qualifying payroll costs, qualifying group health care benefits, qualifying rent and debt obligations, and qualifying utilities. Under the terms of the PPP, certain amounts of the loan may be forgiven if they are used for qualifying expenses. As of December 31, 2020, outstanding balance of the PPP loan amounted to $313,000. In March 2021, the Company obtained a similar PPP loan of $177,000. In June 2021, the April 2020 PPP loan of $313,000 was forgiven by the SBA. Pursuant to ASC 470, Debt, the Company recorded a gain of $313,000 to extinguish the PPP loan and accrued interest of $4,000. As of September 30, 2021, outstanding balance of the PPP loan amounted to $177,000. In November 2021, the March 2021 PPP loan of $177,000 was forgiven by the SBA. (d) On May 15, 2020, the Company received a $150,000 loan (the “EID Loan”) from the SBA under the SBA’s Economic Injury Disaster Loan program. The EID Loan has a thirty-year term and bears interest at a rate of 3.75% per annum. Monthly principal and interest payments of $0.7 per month are deferred for twelve months and commenced in June 2021. The EID Loan may be prepaid at any time prior to maturity with no prepayment penalties. The proceeds from the EID Loan must be used for working capital. The EID Loan contains customary events of default and other provisions customary for a loan of this type. Outstanding balance of note payable as of September 30, 2021 and December 31, 2020 amounted to $150,000, respectively. The Company was in compliance with the terms of the EID loan as of September 30, 2021. The Company was in compliance with the terms of the EID loan as of September 30, 2021. (e) In fiscal 2019 and 2020, the Company issued notes payable aggregating $468,000. The notes bear interest at a rate starting from 8% to 148% per annum, each agreement secured by substantially all of the assets of the Company, maturing between March 2020 and July 2021. The Company also made principal payments of $319,000, and one secured note of $21,000 was extinguished as part of a debt settlement obligation transaction. At December 31, 2020, the outstanding balance of the secured note agreements was $128,000. During the nine months ended September 30, 2021, the Company made principal payments of $99,000. At September 30, 2021, the outstanding balance of the secured notes payable was $29,000 and is deemed in default. The Company and the note holder are in negotiations to extend the due date of the note. | Note 5 - Notes Payable Notes payable consisted of the following: December 31, 2020 December 31, 2019 Unsecured notes (a) Notes payable- $1,639,000 in default $ 1,699,000 $ 1,639,000 (b) Notes payable issued by BST-in default 475,000 475,000 (c) Note payable-PPP loan 313,000 - (d) 150,000 - Secured notes payable (e) Notes payable - $32,000 in default at December 31, 2020 128,000 272,000 Total notes payable principal outstanding 2,765,000 2,386,000 Debt discount (52,000 ) - Less current portion of notes payable, net of discount (2,250,000 ) (2,238,000 ) Long term notes payable $ 463,000 $ 148,000 (a) In previous years, the Company issued notes payable in exchange for cash. The notes are unsecured, bears interest at a rate of 8% through 14% per annum and matured starting in fiscal 2011 up to July 2017. As of December 31, 2019 and 2018, the outstanding balance of these notes payable amounted to $1,639,000. During the year ended December 31, 2020, the Company issued a note payable of $60,000 in exchange for cash. The note is unsecured, bears interest at a rate of 12% per annum and will mature in November 2021. As part of the issuance, the Company granted the noteholder warrants to purchase 26,666,666 shares of the Company’s common stock (see Note 12). The warrants are fully vested, exercisable at $0.005 per share and will expire in five years. The Company determined the relative fair value of the warrants to be $60,000, using the BlackScholes option pricing model and was recorded as debt discount to be amortized over the term of the related note. At December 31, 2020, the outstanding balance of the notes payable was $1,699,000 and unamortized debt discount of $52,000. As of December 31, 2020, total notes payable of $1,639,000 are past due and deemed in default. (b) In fiscal 2018, the Company’s consolidated subsidiary BlockSafe, issued promissory notes in exchange for cash. The notes are unsecured, bearing interest at a rate of 8% per annum, and matured in September 2019. As of December 31, 2018, outstanding balance of the notes payable amounted to $775,000 and unamortized debt discount of $196,000. During the year ended December 31, 2019, the Company amortized the entire debt discount of $196,000, $5,000 of the notes were paid, and note holders agreed to exchange $296,000 of notes payable into a financing obligation (see Note 7). At December 31, 2019, the balance of the unsecured promissory notes was $475,000. At December 31, 2020, the outstanding balance of the notes payable amounted to $475,000 and are currently in default. (c) On April 7, 2020, the Company was granted a loan (the “PPP loan”) from Chase Bank in the aggregate amount of $313,000, pursuant to the Paycheck Protection Program (the “PPP”) under the CARES Act. The PPP matures on April 7, 2022, bears interest at a rate of 1% per annum, with the first six months of interest deferred, is payable monthly commencing on October 2020, and is unsecured and guaranteed by the U.S. Small Business Administration (“SBA”). The loan term may be extended to April 7, 2025, if mutually agreed to by the Company and lender. The Company applied ASC 470, Debt (d) On May 15, 2020, the Company received a $150,000 loan (the “EID Loan”) from the SBA under the SBA’s Economic Injury Disaster Loan program. The EID Loan has a thirty-year term and bears interest at a rate of 3.75% per annum. Monthly principal and interest payments of $0.7 per month are deferred for twelve months and commence in May 2021. The EID Loan may be prepaid at any time prior to maturity with no prepayment penalties. The proceeds from the EID Loan must be used for working capital. The EID Loan contains customary events of default and other provisions customary for a loan of this type. The Company was in compliance with the terms of the EID loan as of December 31, 2020. (e) During the year ended December 31, 2019, the Company issued notes payable aggregating $316,000. The notes bears interest at a rate starting from 31.8% to 148% per annum, each agreement secured by substantially all of the assets of the Company, and maturing between March 2020 and April 2021. The Company also made principal payments of $44,000, and at December 31, 2019, the outstanding balance of the secured note agreements was $272,000. During the year ended December 31, 2020, the Company issued notes payable aggregating $152,000. The notes bear interest rate starting at 8% to 39% per annum, each agreement is secured by substantially all of the assets of the Company, and the notes mature through July 2021. In addition, the Company made principal payments of $275,000, and one secured note of $21,000 was extinguished as part of a debt settlement obligation transaction (see Note 9). At December 31, 2020, the outstanding balance of the secured notes payable was $128,000. One note for $32,000 was due in July 2020 and was not repaid in full when due. The Company and the note holders are in negotiations to extend the due date of the note. |
Notes Payable Related Parties
Notes Payable Related Parties | 9 Months Ended | 12 Months Ended |
Sep. 30, 2021 | Dec. 31, 2020 | |
Notes Payable Related Parties | ||
Note 5 - Notes Payable - Related Parties | Note 5 - Notes Payable – Related Parties Notes payable-related parties notes represent notes payable to the Company’s Chief Executive Officer ranging in interest rates of 0% per annum to 10% per annum. The notes are unsecured and the outstanding balance of these notes payable at December 31, 2020 amounted to $952,000. During the nine months ended September 30, 2021, the Company made payments of $259,000. At September 30, 2021, the balance of notes payable-related parties totaled $693,000 which are all due to the Company’s Chief Executive Officer. The notes are due on December 31, 2021. | Note 6 - Notes Payable – Related Parties Notes payable-related parties notes represent notes payable to the Company’s Chief Executive Officer ranging in interest rates of 0% per annum to 10% per annum. The notes are unsecured and have extended due dates of December 31, 2020. Outstanding balance of these notes payable at December 31, 2019 and 2018, amounted to $743,000. During the year ended December 31, 2020, the Company issued similar notes payable for $263,000 to its Chief Executive Officer in exchange for cash. The notes are unsecured, bears interest at an average rate of 7% per annum and is due on demand. The Company also made payments of $54,000. In addition, the noteholder also agreed to change the maturity date of notes payable issued in previous years with an aggregate balance of $753,000 to December 31, 2021 with no changes to the other original term of the notes payable. At December 31, 2020, the balance of notes payable-related parties totaled $952,000 which are all due to the Company’s Chief Executive Officer. Notes totaling $753,000 are due on December 31, 2021 and notes totaling $199,000 have no specified due date and deemed due on demand. |
Financing Obligation
Financing Obligation | 9 Months Ended | 12 Months Ended |
Sep. 30, 2021 | Dec. 31, 2020 | |
Financing Obligation | ||
Note 6 - Financing Obligation | Note 6 – Financing Obligation The Company is in the process of developing Coins or Tokens which are an envisioned virtual currency. In fiscal 2018, the Company’s consolidated subsidiary BlockSafe (BST), issued promissory notes to unrelated parties aggregating $776,000. As part of issuance, the Company agreed to pay a financing obligation to the note holders equal to the note principal in tokens, as defined, to be issued by BlockSafe. In addition, the Company also agreed to issue tokens to an unrelated party in exchange for cash of $50,000. During the year ended December 31, 2019, BlockSafe agreed to issue tokens to unrelated parties in exchange for cash of $122,000. In addition, certain note holders of promissory notes issued by BlockSafe agreed to exchange $315,000 of outstanding principal and accrued interest into the financing obligation to be paid by tokens to be issued by BlockSafe. At September 30, 2021 and December 31, 2020, the outstanding balance of financing obligations amounted to $1,263,000, respectively, to be paid in tokens, as defined. At September 30, 2021 and through the date of filing, BST has not developed or issued any tokens and there is no assurance as to whether, or at what amount, or on what terms, tokens will be available to be issued, if ever. At September 30, 2021, as the tokens do not exist, and any amounts received for tokens are not considered equity or revenue, management determined that 100% of the obligation of $1,263,000 is a liability to be settled by BST, through the issuance of tokens, or through other means if tokens are never issued. | Note 7 – Financing Obligation The Company is in the process of developing Coins or Tokens which are an envisioned virtual currency. In fiscal 2018, the Company’s consolidated subsidiary BlockSafe (BST), issued promissory notes to unrelated parties aggregating $776,000. As part of issuance, the Company agreed to pay a financing obligation to the note holders equal to the note principal in tokens, as defined, to be issued by BlockSafe. In addition, the Company also agreed to issue tokens to an unrelated party in exchange for cash of $50,000. As of December 31, 2018, outstanding balance of the financing obligation amounted to $826,000 to be paid by tokens to be issued by BlockSafe. During the year ended December 31, 2019, BlockSafe agreed to issue tokens to unrelated parties in exchange for cash of $122,000. In addition, certain note holders of promissory notes issued by BlockSafe agreed to exchange $315,000 of outstanding principal and accrued interest into the financing obligation to be paid by tokens to be issued by BlockSafe. At December 31, 2020 and 2019, the outstanding balance of financing obligations amounted to $1,263,000, respectively, to be paid in tokens, as defined. At December 31, 2020 and through the date of filing, BST has not developed or issued any tokens and there is no assurance as to whether, or at what amount, or on what terms, tokens will be available to be issued, if ever. At December 31, 2020, as the tokens do not exist, and any amounts received for tokens are not considered equity or revenue, management determined that 100% of the obligation of $1,263,000 is a liability to be settled by BST, through the issuance of tokens, or through other means if tokens are never issued. |
Contingent Payment Obligation
Contingent Payment Obligation | 9 Months Ended | 12 Months Ended |
Sep. 30, 2021 | Dec. 31, 2020 | |
Notes Payable | ||
Note 7 - Contingent Payment Obligation | Note 7 – Contingent Payment Obligation On September 6, 2017, the Company entered into a litigation funding agreement with Therium Inc. (subsequently Therium Luxembourg) and VGL Capital, LLC (collectively the “Funders”). Under the agreement, the Company received $1,500,000 from the Funders to allow the Company to pursue patent enforcement actions against infringements of its patents. In exchange, the Funders are entitled to receive, after the payment of legal fees, the first $1,500,000 from the gross proceeds of any claims awarded, 10% of any additional claim proceeds until the Funders have received an additional $7,500,000, and 2.5% of any claim proceeds thereafter. The Funders shall be paid only in the event that the Company achieves recoveries of claim proceeds. At September 30, 2021 and December 31, 2020, the Company has reflected the $1,500,000 received from the Funders as a contingent payment obligation to be paid only if claim proceeds are recovered. | Note 8 – Contingent Payment Obligation On September 6, 2017, the Company entered into a litigation funding agreement with Therium Inc. (subsequently Therium Luxembourg) and VGL Capital, LLC (collectively the “Funders”). Under the agreement, the Company received $1,500,000 from the Funders to allow the Company to pursue patent enforcement actions against infringements of its patents (see Note 15). In exchange, the Funders are entitled to receive, after the payment of legal fees, the first $1,500,000 from the gross proceeds of any claims awarded, 10% of any additional claim proceeds until the Funders have received an additional $7,500,000, and 2.5% of any claim proceeds thereafter. The Funders shall be paid only in the event that the Company achieves recoveries of claim proceeds. At December 31, 2020 and 2019, the Company has reflected the $1,500,000 received from the Funders as a contingent payment obligation to be paid only if claim proceeds are recovered. |
Derivative Financial Instrument
Derivative Financial Instruments | 9 Months Ended | 12 Months Ended |
Sep. 30, 2021 | Dec. 31, 2020 | |
Derivative Financial Instruments | ||
Note 8 - Derivative Financial Instruments | Note 8 – Derivative Financial Instruments In prior years, the Company issued convertible notes payable whose conversion shares were not explicitly limited. As a result, the Company was unable to conclude that it had enough authorized and unissued shares available to settle the conversion option. The result was that the conversion option was bifurcated from the debt host and accounted for as a derivative liability in accordance with ASC 815, and re-measured at the end of every reporting period with the change in value reported in the statement of operations. Furthermore, since the number of shares to be issued to settle the conversion option was potentially unlimited, the Company would be unable to conclude that it has sufficient authorized and available shares to satisfy other commitments to issue shares if it did not have a sequencing policy. The Company has not adopted, documented and disclosed a sequencing approach that allows its other equity linked financial instruments and conversion options to be classified as equity if they meet the requirements of ASC 815. The derivative liability was valued using a Monte Carlo valuation method through the assistance of a valuations specialist. The Monte Carlo valuation method uses certain assumptions related to risk-free interest rates, expected volatility, expected life of the conversion features, and future dividends. The Monte Carlo method is used in corporate finance and mathematical finance to value and analyze (complex) instruments, portfolios and investments by simulating the various sources of uncertainty affecting their value, and then determining the distribution of their value over the range of resultant outcomes. This is usually done by help of stochastic asset models. At December 31, 2020, the balance of the derivative liabilities was $163,000. During the nine months ended September 30, 2021, the corresponding convertible notes payable were converted to equity (see Note 2 and 10). Pursuant to current accounting guidelines, the Company determined the fair value of the derivative liability one last time which amounted to $382,000 and as a result, the Company recorded a change in fair value of $219,000. The Company also extinguished the derivative liability of $382,000 as part of loss on debt extinguishment in accordance with current accounting guidelines. At September 30, 2021, the Company has no more instruments accounted as derivative liabilities. The fair value of the embedded derivative was determined using the following average assumptions: At Extinguishment December 31, 2020 Conversion feature: Risk-free interest rate 0.08 % 0.09 % Expected volatility 424 % 495%-691 % Expected life (in years) 0.41 year 0.25 to 0.57 year Expected dividend yield - - Fair Value: Conversion feature $ 382,000 $ 163,000 The risk-free interest rate was based on rates established by the Federal Reserve Bank. The expected volatility is based on the historical volatility of the Company’s stock. The expected life of the conversion feature of the notes was based on the remaining terms of the related notes. The expected dividend yield was based on the fact that the Company has not customarily paid dividends to its common stockholders in the past and does not expect to pay dividends to its common stockholders in the future. The following table sets forth a summary of the changes in the estimated fair value of our embedded derivative during the nine months ended September 30, 2021 and 2020: Nine months ended September 30, 2021 Nine months ended September 30, 2020 Fair value at beginning of period $ 163,000 $ 1,516,000 Recognition of derivative liabilities upon initial valuation - 776,000 Fair value of derivative liabilities at extinguishment (382,000 ) (1,337,000 ) Net change in the fair value of derivative liabilities 219,000 (165,000 ) Fair value at end of period $ - $ 790,000 | Note 10 – Derivative Financial Instruments In prior years, the Company issued convertible notes payable whose conversion shares was not explicitly limited. As a result, the Company was unable to conclude that it had enough authorized and unissued shares available to settle the conversion option. The result was that the conversion option is bifurcated from the debt host and accounted for as a derivative liability in accordance with ASC 815, and to be re-measured at the end of every reporting period with the change in value reported in the statement of operations. Furthermore, since the number of shares to be issued to settle the conversion option is potentially unlimited, the Company would be unable to conclude that it has sufficient authorized and available shares to satisfy other commitments to issue shares if it did not have a sequencing policy. The Company has not adopted, documented and disclosed a sequencing approach that allows its other equity linked financial instruments and conversion options to be classified as equity if they meet the requirements of ASC 815. The derivative liability is being valued using a Monte Carlo valuation method through the assistance of a valuations specialist. The Monte Carlo valuation method uses certain assumptions related to risk-free interest rates, expected volatility, expected life of the conversion features, and future dividends. The Monte Carlo method is used in corporate finance and mathematical finance to value and analyze (complex) instruments, portfolios and investments by simulating the various sources of uncertainty affecting their value, and then determining the distribution of their value over the range of resultant outcomes. This is usually done by help of stochastic asset models. At December 31, 2018, the balance of the derivative liabilities was $1,314,000. During the year ended December 31, 2019, the Company recorded additions of $1,727,000 related to the conversion features of notes issued during the period (see Note 3), and an decrease in fair value of derivatives of $311,000. In addition, the Company recorded a decrease in derivative liability of $1,214,000 related to derivative liabilities that were extinguished due to conversion and settlement of the corresponding notes payable and recorded as part of loss on debt extinguishment. At December 31, 2019, the balance of the derivative liabilities was $1,516,000. During the year ended December 31, 2020, the Company recorded additions of $917,000 related to the conversion features of notes issued during the period (see Note 3), and an increase in fair value of derivatives of $1,190,000. In addition, the Company recorded a decrease in derivative liability of $3,460,000 related to derivative liabilities that were extinguished when the related convertible note payable was converted into shares of common stock (see Notes 3 and 12) and was recorded as part of loss on debt extinguishment. At December 31, 2020, the balance of the derivative liabilities was $163,000. The fair value of the embedded derivative was determined using the following assumptions: December 31, 2020 January 2020 to December 2020 (dates of inception) December 31, 2019 Conversion feature: Risk-free interest rate 0.09 % 0.11%-0.65 % 1.59 % Expected volatility 495%-691 % 152%-277 % 145%-155 % Expected life (in years) 0.25 to 0.57 year 1 year 0.25 to 1 year Expected dividend yield - - - Fair Value: Conversion feature $ 163,000 $ 917,000 $ 1,516,000 The following table sets forth a summary of the changes in the estimated fair value of our embedded derivative during the years ended December 31, 2020 and 2019: Year ended December 31, 2020 Year ended December 31, 2019 Fair value at beginning of period $ 1,516,000 $ 1,314,000 Recognition of derivative liabilities upon initial valuation 917,000 1,727,000 Extinguishment of derivative liabilities (3,460,000 ) (1,214,000 ) Net change in the fair value of derivative liabilities 1,190,000 (311,000 ) Fair value at end of period $ 163,000 $ 1,516,000 |
Debt Settlement Obligations
Debt Settlement Obligations | 12 Months Ended |
Dec. 31, 2020 | |
Debt Settlement Obligations | |
Note 9 - Debt Settlement Obligation | Note 9 – Debt Settlement Obligation On May 13, 2020, the Company entered into a settlement agreement with Continuation Capital, Inc. (“Continuation”). Continuation paid $198,000 owed to Company creditors, including $140,000 of convertible debt and accrued interest due to a related party (see Note 4), $29,000 of secured notes payable and accrued interest (see Note 5) and $29,000 of accounts payable. In exchange, the Company issued 35,967,234 shares of common stock to Continuation with a fair value of $459,000. The Company accounted this transaction in accordance with ASC 480-10 and the debt settled was measured at fair value. As a result, the Company recorded a loss on debt extinguishment $261,000 to account the difference between the carrying value of the debt settled and the fair value of the common shares issued to Continuation. |
Operating Lease
Operating Lease | 6 Months Ended | 12 Months Ended |
Jun. 30, 2021 | Dec. 31, 2020 | |
Debt Settlement Obligations | ||
Note 9 - Operating Lease | Note 9 - Operating Lease In January 2019, the Company entered into a noncancelable operating lease for its headquarters office requiring payments of approximately $4,000 per month, payments increasing 3% each year, and ending on January 31, 2024. We determine if an arrangement is a lease at inception. Lease assets are presented as operating lease right-of-use assets and the related liabilities are presented as lease liabilities in our consolidated balance sheets pursuant to ASC 842, Leases. Operating lease right-of-use (“ROU”) assets and liabilities are recognized at commencement date based on the present value of lease payments over the lease term. ROU assets represent our right to use an underlying asset for the lease term and lease liabilities represent the Company’s obligation to make lease payments arising from the lease. Generally, the implicit rate of interest in arrangements is not readily determinable and the Company utilizes its incremental borrowing rate in determining the present value of lease payments. The operating lease ROU asset includes any lease payments made and excludes lease incentives. The components of lease expense and supplemental cash flow information related to leases for the period are as follows: Nine months ended September 30, 2021 Nine months ended September 30, 2020 Lease Cost Operating lease cost (included in general and administration in the Company’s statement of operations) $ 42,000 $ 42,000 Other Information Cash paid for amounts included in the measurement of lease liabilities for the nine months ended September 30, 2021 and 2020 $ 42,000 $ 41,000 Weighted average remaining lease term – operating leases (in years) 2.3 3.3 Average discount rate – operating leases 10.0 % 10.0 % The supplemental balance sheet information related to leases for the period is as follows: At September 30, 2021 Operating leases Long-term right-of-use assets $ 120,000 Short-term operating lease liabilities $ 39,000 Long-term operating lease liabilities 86,000 Total operating lease liabilities $ 125,000 Maturities of the Company’s lease liabilities are as follows: Year Ending Operating Leases 2021 (remaining 3 months) 14,000 2022 58,000 2023 59,000 2024 5,000 Total lease payments 136,000 Less: Imputed interest/present value discount (11,000 ) Present value of lease liabilities $ 125,000 Lease expenses were $42,000 and $42,000 during the nine months ended September 30, 2021 and 2020, respectively. | Note 11 - Operating Lease In January 2019, the Company entered into a noncancelable operating lease for its headquarters office requiring payments of approximately $4,000 per month, payments increasing 3% each year, and ending on January 31, 2024. At December 31, 2020, the remaining lease term was 3.08 years. The Company does not have any other leases. Operating lease right-of-use (“ROU”) assets and liabilities are recognized at commencement date based on the present value of lease payments over the lease term. ROU assets represent our right to use an underlying asset for the lease term and lease liabilities represent the Company’s obligation to make lease payments arising from the lease. Generally, the implicit rate of interest in arrangements is not readily determinable and the Company utilizes its incremental borrowing rate in determining the present value of lease payments. The operating lease ROU asset includes any lease payments made and excludes lease incentives. The components of lease expense and supplemental cash flow information related to leases for the period are as follows: Year ended December 31, 2020 Year ended December 31, 2019 Lease Cost Operating lease cost (included in general and administration in the Company’s statement of operations) $ 56,000 $ 56,000 Other Information Cash paid for amounts included in the measurement of lease liabilities for the years ended December 31, 2020 and 2019 $ 55,000 $ 53,000 Weighted average remaining lease term – operating leases (in years) 3.1 4.1 Average discount rate – operating leases 10.0 % 4.0 % The supplemental balance sheet information related to leases for the period is as follows: At December 31, 2020 Operating leases Long-term right-of-use assets $ 157,000 Short-term operating lease liabilities $ 38,000 Long-term operating lease liabilities 125,000 Total operating lease liabilities $ 163,000 Maturities of the Company’s lease liabilities are as follows: Year Ending Operating Leases 2021 56,000 2022 58,000 2023 59,000 2024 5,000 Total lease payments 178,000 Less: Imputed interest/present value discount (15,000 ) Present value of lease liabilities $ 163,000 Lease expenses were $56,000 and $52,000 during the years ended December 31, 2020 and 2019, respectively. |
Stockholders Deficit
Stockholders Deficit | 9 Months Ended | 12 Months Ended |
Sep. 30, 2021 | Dec. 31, 2020 | |
Stockholders Deficit | ||
Note 10 - Stockholders' Deficit | Note 10 – Stockholders’ Deficit Common Stock During the nine months ended September 30, 2021, the Company issued an aggregate of 137,177,418 shares of its common stock as follows: · During the period ended September 30, 2021, pursuant to our offering under Regulation A, the Company issued 119,666,450 shares of common stock in exchange for cash of $5,368,000, net of direct fees and commission. As part of the offering, the Company also issued warrants to certain investors and placement agent to purchase 55 million shares of common stock. The warrants are fully vested, exercisable at $0.05 per share and will expire in five years. · The Company issued 881,550 shares of its common stock for services, with a fair value of $66,000. The common shares were valued at the respective date of issuances. Included in this issuance was 500,000 shares of common stock with a fair value of $36,000, for the purchase of a complimentary business, Cybersecurity Risk Solutions, LLC. At the date of acquisition, Cybersecurity Risk Solutions, LLC had nominal assets and liabilities, no revenues and limited operating history. Furthermore, the Company also determined that the acquisition did not meet the requirement of a significant acquisition pursuant to the regulations of the Securities and Exchange Commission. · The Company issued 16,168,589 shares of common stock with a fair value of $1,035,000 upon conversion of convertible notes payable and accrued interest (see Note 2). · The Company issued 460,829 shares of common stock with a fair value of $88,000 as debt settlement (see Note 4). Warrants The table below summarizes the Company’s warrant activities for the nine months ended September 30, 2021: Number of Warrant Shares Exercise Price Range Per Share Weighted Average Exercise Price Balance, January 1, 2021 27,405,475 $ 0.0045-2.90 $ 0.013132 Granted 55,000,000 0.05 0.05 Canceled/Expired - - - Exercised (13,424,241 ) - - Balance outstanding, September 30, 2021 68,981,234 $ 0.0045-2.90 $ 0.042114 Balance exercisable, September 30, 2021 68,981,234 $ 0.0045-2.90 $ 0.042114 During the nine months ended September 30, 2021, pursuant to the terms of the warrant grant, 13,333,333 warrant shares were exercised on a cashless basis in exchange for 12,349,726 shares of common stock. In addition, 90,908 warrant shares granted to a financing entity in fiscals 2019 and 2020 as part of a financing transaction was exercised. As a result of the exercise, the Company issued 45,150,500 shares of common stock with a fair value of $6,569,000. The common shares issued were valued at the date of issuance and recorded as a finance cost. At September 30, 2021, intrinsic value of the warrants amounted to $2,657,000. The following table summarizes information concerning outstanding and exercisable warrants as of September 30, 2021: Warrants Outstanding and Exercisable Range of Exercise Prices Number Outstanding Average Remaining Contractual Life (in years) Weighted Average Exercise Price $ 0.0045 13,349,242 4.00 $ 0.0045 $ 0.085 588,235 4.00 $ 0.085 $ 0.05 55,000,000 5.00 $ 0.05 $ 0.75 26,515 3.00 $ 0.75 $ 2.90 17,242 3.00 $ 2.90 $ 0.0045 - $2.90 68,981,234 4.00 $ 0.013132 | Note 12 – Stockholders’ Deficit Preferred Stock On October 21, 2010, the Company amended its Articles of Incorporation in New Jersey to authorize 10,000,000 shares of preferred stock, par value $0.10. The designations, rights, and preferences of such preferred stock are to be determined by the Board of Directors. On November 15, 2010, the Company changed its domicile from the State of New Jersey to the State of Wyoming. In addition to the 10,000,000 shares of preferred stock authorized on October 21, 2010, on January 10, 2011, 100 shares of preferred stock were designated as Series A Preferred Stock and 100,000,000 shares were designated as Series B Preferred Stock. The bylaws under the Wyoming Incorporation were amended to reflect the rights and preferences of each additional new designation. The Series A Preferred Stock collectively has voting rights equal to eighty percent of the total current issued and outstanding shares of common stock. If at least one share of Series A Preferred Stock is outstanding, the aggregate shares of Series A Preferred Stock shall have voting rights equal to the number of shares of common stock equal to four times the sum of the total number of shares of common stock issued and outstanding, plus the number of shares of Series B Preferred Stock (or other designated preferred stock) which are issued and outstanding. The Series B Preferred Stock has preferential liquidation rights in the event of any liquidation, dissolution or winding up of the Company, such liquidation rights to be paid from the assets of the Company not delegated to parties with greater priority at $1.00 per share or, in the event an aggregate subscription by a single subscriber of the Series B Preferred Stock is greater than $100,000,000, $0.997 per share. The Series B Preferred Stock shall be convertible to a number of shares of common stock equal to the price of the Series B Preferred Stock divided by the par value of the Series B Preferred Stock. The option to convert the shares of Series B Preferred Stock may not be exercised until three months following the issuance of the Series B Preferred Stock to the recipient shareholder. The Series B Preferred Stock shall have ten votes on matters presented to the shareholders of the Company for one share of Series B Preferred Stock held. The initial price of the Series B Preferred Stock shall be $2.50, (subject to adjustment by the Company’s Board of Directors) until such time, if ever, the Series B Preferred Stock are listed on a secondary and/or public exchange. In February 2014, the Company’s Board of Directors amended the conversion feature of the Series B Preferred Stock, to permit conversion to common shares at a 40% market discount to current market value at the time the Company receives a conversion request. Current market value is defined as the average of the immediately prior five trading day’s closing prices. Additionally, when Series B Preferred Stock shares convert to the Company’s common stock, the minimum price discount floor level is set at $0.005, as decided by the Company’s Board of Directors. Series A Preferred Stock In 2011, the Company issued three shares of non-convertible Series A Preferred Stock valued at $329,000 per share, or $987,000 in aggregate to three members of the management team. The Series A Preferred Stock are convertible into four times the total number of common shares plus the total number of shares of Series B preferred stock issued and outstanding at the time of conversion and have voting rights equal to eighty percent of the total issued and outstanding shares of the Company’s common stock. This effectively provided the management team, upon retention of their Series A Preferred Stock, voting control on matters presented to the shareholders of the Company. The shareholders of the Series A Preferred Stock have each irrevocably waived their conversion rights relating to the Series A Preferred Stock issued. Series B Preferred Stock The Series B Preferred Stock has preferential liquidation rights in the event of any liquidation, dissolution or winding up of the Company, such liquidation rights to be paid from the assets of the Company not delegated to parties with greater priority at $1.00 per share or, in the event an aggregate subscription by a single subscriber of the Series B Preferred Stock is greater than $100,000,000, $0.997 per share. The Series B Preferred Stock shall be convertible to a number of shares of common stock equal to the price of the Series B Preferred Stock divided by the par value of the Series B Preferred Stock. The option to convert the shares of Series B Preferred Stock may not be exercised until three months following the issuance of the Series B Preferred Stock to the recipient shareholder. The Series B Preferred Stock shall have ten votes on matters presented to the shareholders of the Company for one share of Series B Preferred Stock held. The initial price of the Series B Preferred Stock shall be $2.50, (subject to adjustment by the Company’s Board of Directors) until such time, if ever, the Series B Preferred Stock are listed on a secondary and/or public exchange. At December 31, 2019 and 2020, there were 36,667 shares of Series B Preferred Stock outstanding. There were no issuances of Series B Preferred stock during fiscal 2020 and 2019. Common Stock On November 13, 2020, the Company’s filing of an Offering Circular on Form 1-A, pursuant to Regulation A (File Number: 024-11267) was qualified by the Securities and Exchange Commission. The Company registered 668,449,198 shares of common stock estimated proceeds of $2,315,000 (after deducting the maximum broker discount and costs of the offering). During the year ended December 31, 2020, the Company issued an aggregate of 718,337,380 shares of its common stock as follows: • In November 2020, the Company sold 436,337,203 shares of common stock for net proceeds of $976,000 in an offering under Regulation A. • The Company issued 6,378,671 shares of its common stock for services, with a fair value of $39,000. The common shares were valued at the respective date of issuances. • The Company issued 233,748,884 shares of common stock upon conversion of convertible notes payable and accrued interest (see Note 3). • The Company issued 35,967,234 shares of common stock upon conversion of debt settlement (see Note 9). • In December 2020, a decrease of the Company’s authorized common stock to 4,000,000,000 shares was authorized. During the year ended December 31, 2019, the Company issued an aggregate of 5,905,388 shares of its common stock as follows: • The Company issued 60 shares of its common stock for services, with de minimus fair value. • The Company issued 1,157,829 shares of common stock upon conversion of convertible notes payable and accrued interest. Warrants In January and July 2020, in connection with the issuance of convertible notes that aggregated $100,000 (see Note 3) and promissory note of $60,000 (see Note 5), the Company issued warrants to purchase 27,304,901 shares of the Company’s common stock. The warrants were exercisable immediately, at exercise prices from $0.0045 to $0.75 per share, and expire in 5 years. The warrants are classified within stockholders’ deficit, and the proceeds were allocated between the notes and warrants based on their relative fair value. The relative fair value of the warrants was determined to be $118,000 and was recorded as debt discount and additional paid-in-capital. The table below summarizes the Company’s warrant activities for the years ended December 31, 2020 and 2019: Number of Warrant Shares Exercise Price Range Per Share Weighted Average Exercise Price Balance, January 1, 2019 - $ - $ - Granted 100,574 0.75-2.90 1.1185 Canceled/Expired - - - Exercised - - - Balance, January 1, 2020 100,574 0.75-2.90 1.1185 Granted 27,304,901 0.0045 $ 0.0045 Canceled/Expired - - - Exercised - - - Balance, December 31, 2020 27,405,475 $ 0.0045-2.90 $ 0.011676 Balance outstanding and exercisable, December 31, 2020 27,405,475 $ 0.0045-2.90 $ 0.011676 At December 31, 2020 and 2019, there was no intrinsic value of the warrants. The following table summarizes information concerning outstanding and exercisable warrants as of December 31, 2020: Warrants Outstanding and Exercisable Range of Exercise Prices Number Outstanding Average Remaining Contractual Life (in years) Weighted Average Exercise Price $0.0045 26,666,666 5.00 $ 0.0045 $0.085 588,235 5.00 $ 0.085 $0.75 133,333 5.00 $ 0.75 $2.90 17,241 5.00 $ 2.90 $0.0045 - $2.90 27,405,475 5.00 $ 0.011676 |
Stock Options
Stock Options | 9 Months Ended | 12 Months Ended |
Sep. 30, 2021 | Dec. 31, 2020 | |
Stock Options | ||
Note 11 - Stock Options | Note 11 - Stock Options The table below summarizes the Company’s stock option activities for the nine months ended September 30, 2021: Number of Options Shares Exercise Price Range Per Share Weighted Average Exercise Price Balance, January 1, 2021 58,133,001 $ 0.005-1,121,250,000 $ 0.03704 Granted - - - Exercised (42,500,000 ) $ 0.005 $ 0.005 Expired - - - Balance outstanding, September 30, 2021 15,633,001 $ 0.005-1,121,250,000 $ 0.05084 Balance exercisable, September 30, 2021 15,633,001 $ 0.005-1,121,250,000 $ 0.05084 At September 30, 2021, the intrinsic value of outstanding options was $1,168,000. In February 2021, 12,250,000 unvested options granted in fiscal 2020 were modified and such options became fully vested. Pursuant to current accounting guidelines, the Company remeasured the fair value of these options and determined their fair value to be $3,675,000 and was recorded as stock compensation expense. During the period ended September 30, 2021, the Company recorded additional stock compensation expense of $2,712,000 to account for options granted in the prior year that vested. In addition, the Company also issued 39,955,655 shares of the Company’s common stock upon cashless exercise of 42,500,000 options. The following table summarizes information concerning the Company’s stock options as of September 30, 2021: Options Outstanding Options Exercisable Range of Exercise Prices Number Outstanding Average Remaining Contractual Life (in years) Weighted Average Exercise Price Number Exercisable Average Remaining Contractual Life (in years) Weighted Average Exercise Price $ 1,121,250,000 1 2 $ 1,121,250,000 1 2 $ 1,121,250,000 $ 0.005 15,000,000 10 $ 0.005 15,000,000 10 $ 0.005 $ 2.85 126,000 7 $ 2.85 126,000 7 $ 2.85 $ 2.05 115,000 9 $ 2.05 115,000 9 $ 2.05 $ 3.125 392,000 6 $ 3.125 392,000 6 $ 3.125 $ 0.0041 - 975,000,000 15,633,001 6.8 $ 0.05084 15,633,001 6.8 $ 0.05084 |
Income Tax Provision
Income Tax Provision | 12 Months Ended |
Dec. 31, 2020 | |
Income Tax Provision | |
Note 14- Income Tax Provision | Note 14 - Income Tax Provision The income tax provision consists of the following for the year ended: December 31, 2020 December 31, 2019 Federal Current $ - $ - Deferred - - State Current - 2,000 Deferred - - Income tax provision $ - $ 2,000 A reconciliation of the federal statutory income tax rate and the effective income tax rate as a percentage of income before income tax provision is as follows for the year ended: December 31, 2020 December 31, 2019 Federal statutory income tax rate 21.0 % 21.0 % State tax, net of federal benefit 5.0 % 5.0 % Change in valuation allowance on net operating loss carry-forwards (26.0 ) (26.0 ) Effective income tax rate 0.0 % 0.0 % Deferred tax assets and liabilities consist of the following: December 31, 2020 December 31, 2019 Net deferred tax assets: Stock-based compensation $ 702,000 $ 561,000 Private placement costs 366,000 320,000 Operating lease liability 42,000 54,000 Loss on extinguishment of debt 1,697,000 438,000 Net operating loss carryforwards 5,946,000 5,431,000 Gross deferred tax assets 8,753,000 6,804,000 Less valuation allowance (7,255,000 ) (5,775,000 ) Total deferred tax assets 1,498,000 1,029,000 Deferred tax liabilities: Derivative gain 1,455,000 865,000 Debt discount 2,000 110,000 Operating lease right-of-use asset 41,000 54,000 Total deferred tax liabilities 1,498,000 1,029,000 Net deferred tax asset (liability) $ - $ - The provisions of ASC Topic 740, Accounting for Income Taxes, require an assessment of both positive and negative evidence when determining whether it is more likely than not that deferred tax assets are recoverable. For the years ended December 31, 2020 and 2019, based on all available objective evidence, including the existence of cumulative losses, the Company determined that it was more likely than not that the net deferred tax assets were not fully realizable. Accordingly, the Company established a full valuation allowance against its net deferred tax assets. The Company intends to maintain a full valuation allowance on net deferred tax assets until sufficient positive evidence exists to support reversal of the valuation allowance. For the years ended December 31, 2020 and 2019, the valuation allowance increased by $1,480,000 and $795,000, respectively. At December 31, 2020 and 2019, the Company had available Federal and state net operating loss carryforwards (“NOL”s) to reduce future taxable income. For Federal NOL purposes approximately $24.4 million and $21.7 million was available at December 31, 2020 and 2019. For state NOL purposes approximately $12.5 million and $9.8 million was available at December 31, 2020 and 2019, respectively. The Federal carryforwards expire on various dates through 2040 and the state carryforwards expire through 2040. Due to restrictions imposed by Internal Revenue Code Section 382 regarding substantial changes in ownership of companies with loss carryforwards, the utilization of the Company’s NOL may be limited as a result of changes in stock ownership. NOLs incurred subsequent to the latest change in control are not subject to the limitation. The Company’s operations are based in New Jersey and it is subject to Federal and New Jersey state income tax. Tax years after 2015 are open to examination by United States and state tax authorities. The Company adopted the provisions of ASC 740, which requires companies to determine whether it is “more likely than not” that a tax position will be sustained upon examination by the appropriate taxing authorities before any tax benefit can be recorded in the financial statements. ASC 740 also provides guidance on the recognition, measurement, classification and interest and penalties related to uncertain tax positions. As of December 31, 2020 and 2019, no liability for unrecognized tax benefits was required to be recorded or disclosed. |
Commitments and Contingencies
Commitments and Contingencies | 12 Months Ended |
Dec. 31, 2020 | |
Commitments and Contingencies | |
Note 15 - Commitments and Contingencies | Note 15 - Commitments and Contingencies Asset Sale and Licensing Agreement On August 24, 2015, the Company entered into an agreement with Cyber Safety, Inc., a New York corporation (“Cyber Safety”) for Cyber Safety to license, and retain an option to purchase, the patents and intellectual property related to the GuardedID® and MobileTrust® software. Cyber Safety had the option to buy the Company’s GuardedID® patent for $10,000,000 that expires on September 30, 2021. If the purchase price is not paid by September 30, 2021, it will increase to $11,000,000 and be due September 30, 2022. The Company believes, but cannot guarantee, Cyber Safety will exercise its option to purchase GuardedID® based on ongoing constructive discussions with Cyber Safety. There have been no new negotiations with them in regard to the exercise of the option, but there are continuing discussions with them regarding some of their large contracts. The option remains open until September 30, 2022 and Cyber Safety, to the Company’s knowledge, is still contemplating the exercise of the option. Cyber Safety also licensed the Malware Suite until September 30, 2020 and agreed to pay the Company 15% to 20% of the net amount Cyber Safety receives from this product. During the years ended December 31, 2020 and 2019, the Company recorded revenue of $380 and $441,000, respectively, from Cyber Safety. |
Subsequent Events
Subsequent Events | 9 Months Ended | 12 Months Ended |
Sep. 30, 2021 | Dec. 31, 2020 | |
Subsequent Events | ||
Note 12 - Subsequent Events | Note 12 – Subsequent Events Subsequent to September 30, 2021, the Company issued 24,155 shares of common stock for services with a fair value of $2,000. Subsequent to September 30, 2021, the Company granted options to purchase an aggregate of 2,500,000 shares of its common stock to an employee. The options have an exercise price of $0.005 per share, vest over six months, and expire in 10 years. | Note 16 – Subsequent Events Subsequent to December 31, 2020, convertible notes aggregating $45,000 of principal and $6,000 of accrued interest and fees were converted into 16,168,589 shares of common stock at conversion prices ranging from $0.00156 to $0.02 per share. Subsequent to December 31, 2020, the Company issued 460,829 shares of common stock in exchange for the cancellation of accrued interest of $24,000 and the token financing obligation of $100,000. Subsequent to December 31, 2020, the Company issued 34,139,772 shares of common stock upon a cashless exercise of 17,500,000 options shares and 17,045,454 warrants shares. Subsequent to December 31, 2020, the Company issued 128,527 shares of common stock for services with a fair value of $26,000. Subsequent to December 31, 2020, the Company issued 38,116,450 shares of its common stock to investors for cash proceeds of $1,525,000 pursuant to our November 2020 Offering Circular (see Note 12). Subsequent to December 31, 2020, the Company repaid related party convertible notes, secured notes payable and accrued interest in the aggregate of $367,000. Subsequent to December 31, 2020, the Company applied for funding pursuant to the Small Business Administration program. The second round of the Paycheck Protection Program provides forgivable funding for payroll and related costs as well as some non-payroll costs. The Company applied for funding and, to date, have received (on March 16, 2021) funding in the amount of $177,000. |
Organization and Summary of S_2
Organization and Summary of Significant Accounting Policies (Policies) | 9 Months Ended | 12 Months Ended |
Sep. 30, 2021 | Dec. 31, 2020 | |
Organization and Summary of Significant Accounting Policies | ||
Basis of Presentation-Unaudited Interim Financial Information | The accompanying unaudited condensed consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”) for interim financial information and with the rules and regulations of the United States Securities and Exchange Commission (the “SEC”) to Form 10-Q and Article 8 of Regulation S-X. Accordingly, they do not include all of the information and footnotes required by U.S. GAAP for complete financial statements. In the opinion of management, all adjustments (consisting of normal recurring accruals) considered necessary for a fair presentation of the financial position, results of operations and cash flows for the interim periods have been included. The results of operations for the nine months ended September 30, 2021 are not necessarily indicative of the results of operations to be expected for the full fiscal year ending December 31, 2021. These financial statements should be read in conjunction with the financial statements of the Company for the year ended December 31, 2020 and notes thereto contained in the Annual Report on Form 10-K of the Company as filed with the SEC on April 13, 2021. The consolidated financial statements include the accounts of the Company and its subsidiary, BlockSafe Technologies, Inc. (“BST”). BST is owned 49% by the Company and 31% by three executive officers of the Company. BST meets the definition of a variable interest entity (“VIE”) and based on the determination that the Company is the primary beneficiary of BST, BST’s operating results, assets and liabilities are consolidated by the Company. Intercompany balances and transactions have been eliminated in consolidation. At September 30, 2021, noncontrolling interests represents 51% of BST that the Company does not directly own. The Company and BST have a management agreement pursuant to which BST shall remit a management fee of $36,000 per month to the Company, and when BST reaches a milestone of $1,000,000 in financing, an additional management fee of $5,000,000 shall be owed to the Company, payable monthly over three years. The management fee is currently eliminated in consolidation. At September 30, 2021 and December 31, 2020, the amount of VIE cash on the accompanying consolidated balance cash can be used only to settle obligations of BST, and the amounts of VIE accounts payable, VIE Notes Payable, VIE Accrued Interest, and VIE Financing Obligation have no recourse to the general credit of the Company. | The accompanying consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America. The consolidated financial statements include the accounts of the Company and its subsidiary, BlockSafe Technologies, Inc. (“BST”). BST is owned 49% by the Company and 31% by three executive officers of the Company. BST meets the definition of a variable interest entity (“VIE”) and based on the determination that the Company is the primary beneficiary of BST. BST’s operating results, assets and liabilities are consolidated by the Company. Intercompany balances and transactions have been eliminated in consolidation. At December 31, 2020, noncontrolling interests represents 51% of BST that the Company does not directly own. The Company and BST have a management agreement pursuant to which BST shall remit a management fee of $36,000 per month to the Company, and when BST reaches a milestone of $1,000,000 in financing, an additional management fee of $5,000,000 shall be owed to the Company, payable monthly over three years. The management fee is eliminated in consolidation. At December 31, 2020 and 2019, the amount of VIE cash on the accompanying consolidated balance sheets can be used only to settle obligations of BST, and the amounts of VIE accounts payable, VIE Notes Payable, VIE Accrued Interest, and VIE Financing Obligation have no recourse to the general credit of the Company. |
Going Concern | The accompanying financial statements have been prepared on a going concern basis, which contemplates the realization of assets and the settlement of liabilities and commitments in the normal course of business. As reflected in the accompanying financial statements, for the nine months ended September 30, 2021, the Company incurred a net loss of $15,842,000 and used cash in operating activities of $2,014,000 and at September 30, 2021, the Company had a stockholders’ deficit of $10,668,000. Also, at September 30, 2021, the Company is in default on notes payable and convertible notes payable in the aggregate amount of $3,417,000. These factors, among others, raise substantial doubt about the Company’s ability to continue as a going concern within one year of the date that these financial statements are issued. In addition, the Company’s independent registered public accounting firm, in its report on the Company’s December 31, 2020 financial statements, raised substantial doubt about the Company’s ability to continue as a going concern. The accompanying financial statements do not include any adjustments that might be necessary if the Company is unable to continue as a going concern. At September 30, 2021, the Company had cash on hand in the amount of $3,180,000. Management estimates that the current funds on hand will be sufficient to continue operations through the next eighteen months. The Company’s ability to continue as a going concern is dependent upon its ability to continue to implement its business plan. Currently, management is attempting to increase revenues by selling through a channel of distributors, value added resellers, strategic partners and original equipment manufacturers. While the Company believes in the viability of its strategy to increase revenues, there can be no assurances to that effect. The Company’s ability to continue as a going concern is dependent upon its ability to increase its customer base and realize increased revenues. No assurance can be given that any future financing, if needed, will be available or, if available, that it will be on terms that are satisfactory to the Company. Even if the Company is able to obtain additional financing, if needed, it may contain undue restrictions on its operations, in the case of debt financing, or cause substantial dilution for its stockholders, in the case of equity financing. | The accompanying consolidated financial statements have been prepared on a going concern basis, which contemplates the realization of assets and the settlement of liabilities and commitments in the normal course of business. As reflected in the accompanying financial statements, for the year ended December 31, 2020, the Company incurred a net loss of $10,088,000 and used cash in operating activities of $2,256,000, and at December 31, 2020, the Company had a stockholders’ deficit of $14,342,000. Also, at December 31, 2020, the Company is in default on notes payable and convertible notes payable in the aggregate amount of $3,604,000. These factors raise substantial doubt about the Company’s ability to continue as a going concern within one year of the date that these financial statements are issued. The consolidated financial statements do not include any adjustments that might be necessary if the Company is unable to continue as a going concern. At December 31, 2020, the Company had cash on hand in the amount of $162,000. Subsequent to December 31, 2020, the Company sold subscriptions for $1,525,000 and issued 38,116,450 shares of its common stock in an offering under Regulation A and received one SBA Paycheck Protection assistance loan for $177,000. Management estimates that the current funds on hand will be sufficient to continue operations through the next six months. The Company’s ability to continue as a going concern is dependent upon its ability to continue to implement its business plan. Currently, management is attempting to increase revenues by selling through a channel of distributors, value added resellers, strategic partners and original equipment manufacturers. While the Company believes in the viability of its strategy to increase revenues, there can be no assurances to that effect. The Company’s ability to continue as a going concern is dependent upon its ability to increase its customer base and realize increased revenues. No assurance can be given that any future financing, if needed, will be available or, if available, that it will be on terms that are satisfactory to the Company. Even if the Company is able to obtain additional financing, if needed, it may contain undue restrictions on its operations, in the case of debt financing, or cause substantial dilution for its stockholders, in the case of equity financing. |
Reverse Split | On June 25, 2020, the Company completed a 1:500 reverse stock split of its issued and outstanding shares of common stock and all fractional shares were rounded up. All share and per share amounts have been adjusted retroactively to reflect the reverse stock split as if it had occurred at the beginning of the earliest period presented. | On June 25, 2020, the Company completed a 1:500 reverse stock split of the Company’s issued and outstanding shares of common stock and all fractional shares were rounded up. All share and per share amounts in the accompanying financial statements have been adjusted retroactively to reflect the reverse stock split as if it had occurred at the beginning of the earliest period presented. |
COVID-19 | In March 2020, the World Health Organization declared coronavirus COVID-19 a global pandemic. This contagious disease outbreak, which has continued to spread, has adversely affected workforces, customers, economies, and financial markets globally. It has also disrupted the normal operations of many businesses. This outbreak could decrease spending, adversely affect demand for the Company’s products, and harm the Company’s business and results of operations. During the nine months ended September 30, 2021 and the year ended December 31, 2020, the Company believes the COVID-19 pandemic did impact its operating results. For the year ended December 31, 2020, sales to customers decreased by 73% as compared to the prior year. However, the Company has not observed any impairments of its assets or a significant change in the fair value of its assets due to the COVID-19 pandemic. At this time, it is not possible for the Company to predict the duration or magnitude of the adverse results of the outbreak and its effects on the Company’s business or results of operations, financial condition, or liquidity. The Company has been following the recommendations of health authorities to minimize exposure risk for its team members during the pandemic, including the temporary closure of its corporate office and having team members work remotely. During the second quarter of 2021, the Company reopened its corporate office while continuing to adhere to the guidelines issued by health authorities. Many customers and vendors have transitioned to electronic submission of invoices and payments. | In March 2020, the World Health Organization declared coronavirus COVID-19 a global pandemic. This contagious disease outbreak, which has continued to spread, has adversely affected workforces, customers, economies, and financial markets globally. It has also disrupted the normal operations of many businesses. This outbreak could decrease spending, adversely affect demand for the Company’s products, and harm the Company’s business and results of operations. During the year ended December 31, 2020, the Company believes the COVID-19 pandemic did impact its operating results as sales to customers were down 73% as compared from the year ended December 31, 2019. However, the Company has not observed any impairments of its assets or a significant change in the fair value of its assets due to the COVID-19 pandemic. At this time, it is not possible for the Company to predict the duration or magnitude of the adverse results of the outbreak and its effects on the Company’s business or results of operations, financial condition, or liquidity. The Company has been following the recommendations of health authorities to minimize exposure risk for its team members, including the temporary closure of its corporate office and having team members work remotely. Most customers and vendors have transitioned to electronic submission of invoices and payments. |
Use of Estimates | The preparation of financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Significant estimates include those related to accounting for financing obligations, assumptions used in valuing stock instruments issued for services, assumptions used in valuing derivative liabilities, the valuation allowance for deferred tax assets, and the accrual of potential liabilities. Actual results could differ from those estimates. | The preparation of financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Significant estimates include those related to accounting for financing obligations, assumptions used in valuing stock instruments issued for services, assumptions used in valuing derivative liabilities, the valuation allowance for deferred tax assets, and the accrual of potential liabilities. Actual results could differ from those estimates. |
Revenue Recognition | The Company follows the guidance of Accounting Standards Codification (ASC) 606, Revenue from Contracts with Customers The Company’s revenue consists of revenue from sales and support of our software products. Revenue primarily consists of sales of software licenses of our ProtectID®, GuardedID®, MobileTrust® and SafeVchat™ products. The Company usually recognizes subscription revenue over a one-month period based on a typical monthly renewal cycle in accordance with its customer agreement terms. For service contracts, the Company’s performance obligations are satisfied, and the related revenue is recognized, as services are rendered. The Company offers no discounts, rebates, rights of return, or other allowances to clients which would result in the establishment of reserves against service revenue. Additionally, to date, the Company has not incurred incremental costs in obtaining customer contracts. Cost of revenue includes direct costs and fees related to the sale of our products. The following tables present our revenue disaggregated by major product and service lines: Three months ended September 30, September 30, 2020 Software $ 39,000 $ 49,000 Service 1,000 2,000 Total revenue $ 40,000 $ 51,000 Nine months ended September 30, September 30, 2020 Software $ 148,000 $ 156,000 Service 5,000 6,000 Total revenue $ 153,000 $ 162,000 | The Company follows the guidance of Accounting Standards Codification (ASC) 606, Revenue from Contracts with Customers The Company’s revenue consists of revenue from sales and support of our software products. Revenue primarily consists of sales of software licenses of our ProtectID®, GuardedID® and MobileTrust® products. The Company usually recognizes subscription revenue over a one-month period based on a typical monthly renewal cycle in accordance with its customer agreement terms. For service contracts, the Company’s performance obligations are satisfied, and the related revenue is recognized, as services are rendered. The Company offers no discounts, rebates, rights of return, or other allowances to clients which would result in the establishment of reserves against service revenue. Additionally, to date, the Company has not incurred incremental costs in obtaining customer contracts. Cost of revenue includes direct costs and fees related to the sale of our products. The following tables present our revenue disaggregated by major product and service lines: Year ended December 31, December 31, 2019 Software $ 200,000 $ 764,000 Service 7,000 4,000 Total revenue $ 207,000 $ 768,000 |
Property and Equipment | Property and equipment are recorded at cost less accumulated depreciation and amortization. Property and equipment are depreciated using the straight-line method over the estimated useful lives of the related assets as follows: Estimated Useful Life (Years) Computer equipment 5 Computer software 3 Furniture and fixture 7 Office equipment 7 Expenditures for major additions and betterments are capitalized. Maintenance and repairs are charged to operations as incurred. Upon sale or retirement of property and equipment, the related cost and accumulated depreciation are removed from the accounts and any gain or loss is reflected in the statements of operations. Management assesses the carrying value of property and equipment whenever events or changes in circumstances indicate that the carrying value may not be recoverable. If there is indication of impairment, management prepares an estimate of future cash flows expected to result from the use of the asset and its eventual disposition. If these cash flows are less than the carrying amount of the asset, an impairment loss is recognized to write down the asset to its estimated fair value. For the years ended December 31, 2020 and 2019, the Company did not recognize any impairment for its property and equipment. | |
Impairment of Long-lived Assets | The Company reviews its property and equipment, right-of-use assets, and other long-lived assets, including intangible assets other than goodwill, for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset group may not be recoverable. Recoverability is measured by a comparison of the carrying amount of an asset to the estimated undiscounted future cash flows expected to be generated by the asset. If the carrying amount of an asset exceeds its estimated undiscounted future cash flows, an impairment charge is recognized by the amount by which the carrying amount of the asset exceeds the fair value of the assets. Fair value is generally determined using the asset’s expected future discounted cash flows or market value, if readily determinable. For the years ended December 31, 2020 and 2019, the Company had no impairment of long-lived assets. | |
Income Taxes | The Company accounts for income taxes using the asset and liability method whereby deferred tax assets are recognized for deductible temporary differences, and deferred tax liabilities are recognized for taxable temporary differences. Temporary differences are the differences between the reported amounts of assets and liabilities and their tax bases. Deferred tax assets are reduced by a valuation allowance when, in the opinion of management, it is more likely than not that some portion or all of the deferred tax assets will be realized. Deferred tax assets and liabilities are adjusted for the effects of changes in tax laws and rates on the date of enactment. | |
Leases | We lease our corporate office space under a lease agreement with monthly payments over a period of 60 months. Pursuant to ASC 840, Leases, lease assets are presented as operating lease right-of-use assets and the related liabilities are presented as lease liabilities in our consolidated balance sheets (see Note 11). | |
Fair Value of Financial Instruments | The Company follows the authoritative guidance issued by the Financial Accounting Standards Board (“FASB”) for fair value measurements. Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants at the measurement date. A fair value hierarchy was established, which prioritizes the inputs used in measuring fair value into three broad levels as follows: Level 1—Quoted prices in active markets for identical assets or liabilities. Level 2—Inputs, other than the quoted prices in active markets, that are observable either directly or indirectly. Level 3—Unobservable inputs based on the Company's assumptions. The Company is required to use of observable market data if such data is available without undue cost and effort. The Company believes the carrying amounts reported in the balance sheet for accounts receivable, accounts payable, accrued expenses, convertible notes, and notes payables approximate fair values because of the short-term nature of these financial instruments. As of December 31, 2020, the Company’s balance sheet included Level 2 liabilities comprised of the fair value of embedded derivative liabilities of $163,000 (see Note 8). | The Company follows the authoritative guidance issued by the Financial Accounting Standards Board (“FASB”) for fair value measurements. Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants at the measurement date. A fair value hierarchy was established, which prioritizes the inputs used in measuring fair value into three broad levels as follows: Level 1—Quoted prices in active markets for identical assets or liabilities. Level 2—Inputs, other than the quoted prices in active markets, that are observable either directly or indirectly. Level 3—Unobservable inputs based on the Company’s assumptions. The Company is required to use of observable market data if such data is available without undue cost and effort. The Company believes the carrying amounts reported in the balance sheet for accounts receivable, accounts payable, accrued expenses, convertible notes, and notes payables approximate fair values because of the short-term nature of these financial instruments. As of December 31, 2020 and 2019, the Company’s balance sheet includes Level 2 liabilities comprised of the fair value of embedded derivative liabilities of $163,000 and $1,516,000, respectively (see Note 10). |
Derivative Financial Instruments | The Company evaluates its financial instruments to determine if such instruments are derivatives or contain features that qualify as embedded derivatives. For derivative financial instruments that are accounted for as liabilities, the derivative instrument is initially recorded at its fair value and is then re-valued at each reporting date, with changes in the fair value reported in the statements of operations. The Company evaluates embedded conversion features within its convertible debt to determine whether the embedded conversion features should be bifurcated from the host instrument and accounted for as a derivative. The fair value of the embedded derivatives are determined using Monte Carlo simulation method at inception and on subsequent valuation dates. The classification of derivative instruments, including whether such instruments should be recorded as liabilities or as equity, is evaluated at the end of each reporting period. | The Company evaluates its financial instruments to determine if such instruments are derivatives or contain features that qualify as embedded derivatives. For derivative financial instruments that are accounted for as liabilities, the derivative instrument is initially recorded at its fair value and is then re-valued at each reporting date, with changes in the fair value reported in the statements of operations. The Company evaluates embedded conversion features within its convertible debt to determine whether the embedded conversion features should be bifurcated from the host instrument and accounted for as a derivative. The fair value of the embedded derivatives are determined using Monte Carlo simulation method at inception and on subsequent valuation dates. The classification of derivative instruments, including whether such instruments should be recorded as liabilities or as equity, is evaluated at the end of each reporting period. |
Stock-Based Compensation | The Company periodically issues stock options, warrants, and shares of common stock as share-based compensation to employees and non-employees in non-capital raising transactions for services and for financing costs. The Company accounts for such grants issued and vesting based on FASB ASC 718, Compensation – Stock Compensation The fair value of the Company’s stock options and warrants are estimated using the Black-Scholes-Merton Option Pricing model, which uses certain assumptions related to risk-free interest rates, expected volatility, expected life of the stock options or restricted stock, and future dividends. Compensation expense is recorded based upon the value derived from the Black-Scholes-Merton Option Pricing model and based on actual experience. The assumptions used in the Black-Scholes-Merton Option Pricing model could materially affect compensation expense recorded in future periods. | The Company periodically issues stock options, warrants, and shares of common stock as share-based compensation to employees and non-employees in non-capital raising transactions for services and for financing costs. The Company accounts for such grants issued and vesting based on FASB ASC 718, Compensation – Stock Compensation The fair value of the Company’s stock options and warrants are estimated using the Black-Scholes-Merton Option Pricing model, which uses certain assumptions related to risk-free interest rates, expected volatility, expected life of the stock options or restricted stock, and future dividends. Compensation expense is recorded based upon the value derived from the Black-Scholes-Merton Option Pricing model and based on actual experience. The assumptions used in the Black-Scholes-Merton Option Pricing model could materially affect compensation expense recorded in future periods. |
Loss per Share | Basic loss per share is computed by dividing net loss available to common stockholders by the weighted average number of common shares outstanding during the period. Diluted loss per share is computed by dividing net loss applicable to common stockholders by the weighted average number of common shares outstanding, plus the number of additional common shares that would have been outstanding if all dilutive potential common shares had been issued using the treasury stock method. Diluted loss per share excludes all potential common shares if their effect is anti-dilutive. The following potentially dilutive shares were excluded from the shares used to calculate diluted earnings per share as their inclusion would be anti-dilutive: Nine months ended September 30, 2021 September 30, 2020 Options to purchase common stock 15,633,001 633,000 Warrants to purchase common stock 68,981,234 738,810 Convertible notes 21 229,203,829 Convertible Series B Preferred stock 608,886 12,619,167 Total 86,207,129 243,194,806 | Basic loss per share is computed by dividing net loss available to common stockholders by the weighted average number of common shares outstanding during the period. Diluted loss per share is computed by dividing net loss applicable to common stockholders by the weighted average number of common shares outstanding, plus the number of additional common shares that would have been outstanding if all dilutive potential common shares had been issued using the treasury stock method. Diluted loss per share excludes all potential common shares if their effect is anti-dilutive. The following potentially dilutive shares were excluded from the shares used to calculate diluted earnings per share as their inclusion would be anti-dilutive: Year ended December 31, 2020 December 31, 2019 Options to purchase common stock 58,133,001 633,001 Warrants to purchase common stock 27,405,476 100,574 Convertible notes 1,156,304 1,554,866 Convertible Series B Preferred stock 791,170 31,548 Total 87,485,950 2,319,989 |
Advertising, Sales and Marketing Costs | Advertising, sales and marketing costs are expensed as incurred and are included in sales and marketing expenses. For the years ended December 31, 2020 and 2019, advertising, sales and marketing expenses were $2,000 and $8,000, respectively. | |
Research and Development Costs | Costs incurred for research and development are expensed as incurred. The salaries, benefits, and overhead costs of personnel conducting research and development of the Company’s software products comprise research and development expenses. Purchased materials that do not have an alternative future use are also expensed. | |
Concentrations | For the nine months ended September 30, 2021, sales to three customers comprised 35%, 35% and 17% of revenues, respectively. For the nine months ended September 30, 2020, sales to two customers comprised 72% and 14% of revenues, respectively. At September 30, 2021, two customers comprised 63% and 12% of accounts receivable, respectively. The Company maintains the majority of its cash balances with one financial institution, in the form of demand deposits. At September 30, 2021, the Company had cash deposits that exceeded the federally insured limit of $250,000 per account. The Company believes that no significant concentration of credit risk exists with respect to its cash balances because of its assessment of the creditworthiness and financial viability of the financial institution. | For the year ended December 31, 2020, sales to two customers comprised 72% and 15% of revenues, respectively. For the year ended December 31, 2019, sales to three customers comprised 58%, 21% and 14% of revenues, respectively. At December 31, 2020, three customers comprised 50%, 24% and 10% of accounts receivable, respectively. At December 31, 2019, three customers comprised 43%, 29% and 12% of accounts receivable, respectively. The Company maintains the majority of its cash balances with one financial institution, in the form of demand deposits. At December 31, 2020, the Company did not have cash deposits that exceeded the federally insured limit of $250,000 per account. The Company believes that no significant concentration of credit risk exists with respect to its cash balances because of its assessment of the creditworthiness and financial viability of the financial institution. |
Segments | The Company operates in one segment for the development and distribution of our software products. In accordance with the “Segment Reporting” Topic of the ASC, the Company’s chief operating decision maker has been identified as the Chief Executive Officer and President, who reviews operating results to make decisions about allocating resources and assessing performance for the entire Company. Existing guidance, which is based on a management approach to segment reporting, establishes requirements to report selected segment information quarterly and to report annually entity-wide disclosures about products and services, major customers, and the countries in which the entity holds material assets and reports revenue. All material operating units qualify for aggregation under “Segment Reporting” due to their similar customer base, single sales team, marketing department, customer service department, operations department, finance and accounting department to support its operations and similarities in: economic characteristics; nature of products and services; and procurement, manufacturing and distribution processes. Since the Company operates in one segment, all financial information required by “Segment Reporting” can be found in the accompanying financial statements. | The Company operates in one segment for the development and distribution of our software products. In accordance with the “Segment Reporting” Topic of the ASC, the Company’s chief operating decision maker has been identified as the Chief Executive Officer and President, who reviews operating results to make decisions about allocating resources and assessing performance for the entire Company. Existing guidance, which is based on a management approach to segment reporting, establishes requirements to report selected segment information quarterly and to report annually entity-wide disclosures about products and services, major customers, and the countries in which the entity holds material assets and reports revenue. All material operating units qualify for aggregation under “Segment Reporting” due to their similar customer base and similarities in: economic characteristics; nature of products and services; and procurement, manufacturing and distribution processes. Since the Company operates in one segment, all financial information required by “Segment Reporting” can be found in the accompanying financial statements. |
Recent Accounting Pronouncements | In June 2016, the FASB issued ASU No. 2016-13, Credit Losses - Measurement of Credit Losses on Financial Instruments In August 2020, the FASB issued ASU No. 2020-06, Debt—Debt with Conversion and Other Options (Subtopic 470-20) and Derivatives and Hedging—Contracts in Entity’s Own Equity (Subtopic 815-40): Accounting for Convertible Instruments and Contracts in an Entity’s Own Equity. In May 2021, the FASB issued ASU 2021-04, Earnings Per Share (Topic 260), Debt—Modifications and Extinguishments (Subtopic 470-50), Compensation—Stock Compensation (Topic 718), and Derivatives and Hedging—Contracts in Entity’s Own Equity (Subtopic 815-40): Issuer’s Accounting for Certain Modifications or Exchanges of Freestanding Equity-Classified Written Call Options Other recent accounting pronouncements issued by the FASB, including its Emerging Issues Task Force, the American Institute of Certified Public Accountants, and the Securities and Exchange Commission did not or are not believed by management to have a material impact on the Company's present or future consolidated financial statements. | In June 2016, the FASB issued ASU No. 2016-13, Credit Losses - Measurement of Credit Losses on Financial Instruments In August 2020, the FASB issued ASU No. 2020-06, Debt—Debt with Conversion and Other Options (Subtopic 470-20) and Derivatives and Hedging—Contracts in Entity’s Own Equity (Subtopic 815-40): Accounting for Convertible Instruments and Contracts in an Entity’s Own Equity. Other recent accounting pronouncements issued by the FASB, including its Emerging Issues Task Force, the American Institute of Certified Public Accountants, and the Securities and Exchange Commission did not or are not believed by management to have a material impact on the Company’s present or future consolidated financial statements. |
Organization and Summary of S_3
Organization and Summary of Significant Accounting Policies (Tables) | 9 Months Ended | 12 Months Ended |
Sep. 30, 2021 | Dec. 31, 2020 | |
Organization and Summary of Significant Accounting Policies | ||
Schedule of Revenue Recognition | Three months ended September 30, September 30, 2020 Software $ 39,000 $ 49,000 Service 1,000 2,000 Total revenue $ 40,000 $ 51,000 Nine months ended September 30, September 30, 2020 Software $ 148,000 $ 156,000 Service 5,000 6,000 Total revenue $ 153,000 $ 162,000 | Year ended December 31, December 31, 2019 Software $ 200,000 $ 764,000 Service 7,000 4,000 Total revenue $ 207,000 $ 768,000 |
Schedule of loss per share | Nine months ended September 30, 2021 September 30, 2020 Options to purchase common stock 15,633,001 633,000 Warrants to purchase common stock 68,981,234 738,810 Convertible notes 21 229,203,829 Convertible Series B Preferred stock 608,886 12,619,167 Total 86,207,129 243,194,806 | Year ended December 31, 2020 December 31, 2019 Options to purchase common stock 58,133,001 633,001 Warrants to purchase common stock 27,405,476 100,574 Convertible notes 1,156,304 1,554,866 Convertible Series B Preferred stock 791,170 31,548 Total 87,485,950 2,319,989 |
Schedule of Property and Equipment | Estimated Useful Life (Years) Computer equipment 5 Computer software 3 Furniture and fixture 7 Office equipment 7 |
Property and Equipment (Tables)
Property and Equipment (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Property and Equipment | |
Schedule of property and equipment, stated at cost, less accumulated depreciation | December 31, 2020 December 31, 2019 Computer equipment $ 82,000 $ 82,000 Computer software 44,000 43,000 Furniture and fixtures 10,000 10,000 Office equipment 17,000 17,000 153,000 152,000 Less accumulated depreciation (151,000 ) (147,000 ) $ 2,000 $ 5,000 |
Convertible Notes Payable (Tabl
Convertible Notes Payable (Tables) | 9 Months Ended | 12 Months Ended |
Sep. 30, 2021 | Dec. 31, 2020 | |
Convertible Notes Payable (Tables) | ||
Schedule of convertible notes payable | September 30, 2021 December 31, 2020 Secured (a) AL-Bank, in default $ 543,000 $ 543,000 Unsecured (b) Convertible notes with fixed conversion prices, in default 895,000 895,000 (c) Convertible notes with adjustable conversion prices - 45,000 Total convertible notes principal outstanding 1,438,000 1,483,000 Debt discount - (14,000 ) Convertible notes, net of discount $ 1,438,000 $ 1,469,000 | December 31, 2020 December 31, 2019 Secured (a) Convertible notes due to DART/Citco, in default $ 543,000 $ 543,000 Unsecured (b) Convertible notes with fixed conversion features, in default 895,000 895,000 (c) Convertible notes with adjustable conversion features, $20,000 in default at December 31, 2020 45,000 845,000 Total convertible notes principal outstanding 1,483,000 2,283,000 Debt discount (14,000 ) (423,000 ) Convertible notes, net of discount $ 1,469,000 $ 1,860,000 |
Notes Payable (Tables)
Notes Payable (Tables) | 9 Months Ended | 12 Months Ended |
Sep. 30, 2021 | Dec. 31, 2020 | |
Notes Payable (Tables) | ||
Schedule of notes payable | September 30, 2021 December 31, 2020 Unsecured notes (a) Notes payable-in default $ 1,639,000 $ 1,699,000 (b) Notes payable issued by BST-in default 310,000 475,000 (c) Note payable-PPP loans 177,000 313,000 (d) Note payable-EID loan 150,000 150,000 Secured notes payable (e) Notes payable-in default 29,000 128,000 Total notes payable principal outstanding 2,305,000 2,765,000 Debt discount - (52,000 ) Less current portion of notes payable, net of discount (1,978,000 ) (2,250,000 ) Long term notes payable $ 327,000 $ 463,000 | December 31, 2020 December 31, 2019 Unsecured notes (a) Notes payable- $1,639,000 in default $ 1,699,000 $ 1,639,000 (b) Notes payable issued by BST-in default 475,000 475,000 (c) Note payable-PPP loan 313,000 - (d) 150,000 - Secured notes payable (e) Notes payable - $32,000 in default at December 31, 2020 128,000 272,000 Total notes payable principal outstanding 2,765,000 2,386,000 Debt discount (52,000 ) - Less current portion of notes payable, net of discount (2,250,000 ) (2,238,000 ) Long term notes payable $ 463,000 $ 148,000 |
Derivative Financial Instrume_2
Derivative Financial Instruments (Tables) | 9 Months Ended | 12 Months Ended |
Sep. 30, 2021 | Dec. 31, 2020 | |
Derivative Financial Instruments | ||
Schedule of derivative liability | At Extinguishment December 31, 2020 Conversion feature: Risk-free interest rate 0.08 % 0.09 % Expected volatility 424 % 495%-691 % Expected life (in years) 0.41 year 0.25 to 0.57 year Expected dividend yield - - Fair Value: Conversion feature $ 382,000 $ 163,000 | December 31, 2020 January 2020 to December 2020 (dates of inception) December 31, 2019 Conversion feature: Risk-free interest rate 0.09 % 0.11%-0.65 % 1.59 % Expected volatility 495%-691 % 152%-277 % 145%-155 % Expected life (in years) 0.25 to 0.57 year 1 year 0.25 to 1 year Expected dividend yield - - - Fair Value: Conversion feature $ 163,000 $ 917,000 $ 1,516,000 |
Summary of changes in derivative liabilities | Nine months ended September 30, 2021 Nine months ended September 30, 2020 Fair value at beginning of period $ 163,000 $ 1,516,000 Recognition of derivative liabilities upon initial valuation - 776,000 Fair value of derivative liabilities at extinguishment (382,000 ) (1,337,000 ) Net change in the fair value of derivative liabilities 219,000 (165,000 ) Fair value at end of period $ - $ 790,000 | Year ended December 31, 2020 Year ended December 31, 2019 Fair value at beginning of period $ 1,516,000 $ 1,314,000 Recognition of derivative liabilities upon initial valuation 917,000 1,727,000 Extinguishment of derivative liabilities (3,460,000 ) (1,214,000 ) Net change in the fair value of derivative liabilities 1,190,000 (311,000 ) Fair value at end of period $ 163,000 $ 1,516,000 |
Operating Lease (Tables)
Operating Lease (Tables) | 9 Months Ended | 12 Months Ended |
Sep. 30, 2021 | Dec. 31, 2020 | |
Operating Lease (Tables) | ||
Schedule of lease expense and supplemental cash flow information | Nine months ended September 30, 2021 Nine months ended September 30, 2020 Lease Cost Operating lease cost (included in general and administration in the Company’s statement of operations) $ 42,000 $ 42,000 Other Information Cash paid for amounts included in the measurement of lease liabilities for the nine months ended September 30, 2021 and 2020 $ 42,000 $ 41,000 Weighted average remaining lease term – operating leases (in years) 2.3 3.3 Average discount rate – operating leases 10.0 % 10.0 % | Year ended December 31, 2020 Year ended December 31, 2019 Lease Cost Operating lease cost (included in general and administration in the Company’s statement of operations) $ 56,000 $ 56,000 Other Information Cash paid for amounts included in the measurement of lease liabilities for the years ended December 31, 2020 and 2019 $ 55,000 $ 53,000 Weighted average remaining lease term – operating leases (in years) 3.1 4.1 Average discount rate – operating leases 10.0 % 4.0 % |
Schedule of maturities | Year Ending Operating Leases 2021 (remaining 3 months) 14,000 2022 58,000 2023 59,000 2024 5,000 Total lease payments 136,000 Less: Imputed interest/present value discount (11,000 ) Present value of lease liabilities $ 125,000 | Year Ending Operating Leases 2021 56,000 2022 58,000 2023 59,000 2024 5,000 Total lease payments 178,000 Less: Imputed interest/present value discount (15,000 ) Present value of lease liabilities $ 163,000 |
Schedule of supplemental balance sheet information | At September 30, 2021 Operating leases Long-term right-of-use assets $ 120,000 Short-term operating lease liabilities $ 39,000 Long-term operating lease liabilities 86,000 Total operating lease liabilities $ 125,000 | At December 31, 2020 Operating leases Long-term right-of-use assets $ 157,000 Short-term operating lease liabilities $ 38,000 Long-term operating lease liabilities 125,000 Total operating lease liabilities $ 163,000 |
Stockholders Deficit (Tables)
Stockholders Deficit (Tables) | 9 Months Ended | 12 Months Ended |
Sep. 30, 2021 | Dec. 31, 2020 | |
Stockholders Deficit | ||
Schedule of stock warrants activity | Number of Warrant Shares Exercise Price Range Per Share Weighted Average Exercise Price Balance, January 1, 2021 27,405,475 $ 0.0045-2.90 $ 0.013132 Granted 55,000,000 0.05 0.05 Canceled/Expired - - - Exercised (13,424,241 ) - - Balance outstanding, September 30, 2021 68,981,234 $ 0.0045-2.90 $ 0.042114 Balance exercisable, September 30, 2021 68,981,234 $ 0.0045-2.90 $ 0.042114 | Number of Warrant Shares Exercise Price Range Per Share Weighted Average Exercise Price Balance, January 1, 2019 - $ - $ - Granted 100,574 0.75-2.90 1.1185 Canceled/Expired - - - Exercised - - - Balance, January 1, 2020 100,574 0.75-2.90 1.1185 Granted 27,304,901 0.0045 $ 0.0045 Canceled/Expired - - - Exercised - - - Balance, December 31, 2020 27,405,475 $ 0.0045-2.90 $ 0.011676 Balance outstanding and exercisable, December 31, 2020 27,405,475 $ 0.0045-2.90 $ 0.011676 |
Schedule of warrants outstanding and exercisable | Warrants Outstanding and Exercisable Range of Exercise Prices Number Outstanding Average Remaining Contractual Life (in years) Weighted Average Exercise Price $ 0.0045 13,349,242 4.00 $ 0.0045 $ 0.085 588,235 4.00 $ 0.085 $ 0.05 55,000,000 5.00 $ 0.05 $ 0.75 26,515 3.00 $ 0.75 $ 2.90 17,242 3.00 $ 2.90 $ 0.0045 - $2.90 68,981,234 4.00 $ 0.013132 | Warrants Outstanding and Exercisable Range of Exercise Prices Number Outstanding Average Remaining Contractual Life (in years) Weighted Average Exercise Price $0.0045 26,666,666 5.00 $ 0.0045 $0.085 588,235 5.00 $ 0.085 $0.75 133,333 5.00 $ 0.75 $2.90 17,241 5.00 $ 2.90 $0.0045 - $2.90 27,405,475 5.00 $ 0.011676 |
Stock Options (Tables)
Stock Options (Tables) | 9 Months Ended | 12 Months Ended |
Sep. 30, 2021 | Dec. 31, 2020 | |
Stock Options (Tables) | ||
Schedule of stock options plan | Number of Options Shares Exercise Price Range Per Share Weighted Average Exercise Price Balance, January 1, 2021 58,133,001 $ 0.005-1,121,250,000 $ 0.03704 Granted - - - Exercised (42,500,000 ) $ 0.005 $ 0.005 Expired - - - Balance outstanding, September 30, 2021 15,633,001 $ 0.005-1,121,250,000 $ 0.05084 Balance exercisable, September 30, 2021 15,633,001 $ 0.005-1,121,250,000 $ 0.05084 | Number of Options Shares Exercise Price Range Per Share Weighted Average Exercise Price Balance, January 1, 2019 519,001 $ 2.85-1,121,250,000 $ 3.125 Granted 115,000 2.05 2.05 Exercised - - - Expired (1,000 ) 8.00 8.00 Balance, December 31, 2019 633,001 2.05-1,121,250,000 2.93 Granted 57,500,000 0.005 0.005 Exercised - - - Expired - - - Balance outstanding, December 31, 2020 58,133,001 $ 0.005-1,121,250,000 $ 0.03704 Balance exercisable, December 31, 2020 5,031,908 $ 0.005-1,121,250,000 $ 0.03704 |
Schedule of stock option outstanding and exercisable | Options Outstanding Options Exercisable Range of Exercise Prices Number Outstanding Average Remaining Contractual Life (in years) Weighted Average Exercise Price Number Exercisable Average Remaining Contractual Life (in years) Weighted Average Exercise Price $ 1,121,250,000 1 2 $ 1,121,250,000 1 2 $ 1,121,250,000 $ 0.005 15,000,000 10 $ 0.005 15,000,000 10 $ 0.005 $ 2.85 126,000 7 $ 2.85 126,000 7 $ 2.85 $ 2.05 115,000 9 $ 2.05 115,000 9 $ 2.05 $ 3.125 392,000 6 $ 3.125 392,000 6 $ 3.125 $ 0.0041 - 975,000,000 15,633,001 6.8 $ 0.05084 15,633,001 6.8 $ 0.05084 | Options Outstanding Options Exercisable Range of Exercise Prices Number Outstanding Average Remaining Contractual Life (in years) Weighted Average Exercise Price Number Exercisable Average Remaining Contractual Life (in years) Weighted Average Exercise Price $1,121,250,000 1 2 $ 1,121,250,000 1 2 $ 1,121,250,000 $2.85 126,000 7 2.85 126,000 7 2.85 $3.125 392,000 6 3.125 392,000 6 3.125 $2.05 115,000 9 2.05 115,000 9 2.05 $0.005 57,500,000 10 0.005 4,398,907 10 0.005 $0.005 – 1,121,250,000 58,133,001 6.8 $ 0.03704 5,031,908 6.8 $ 0.03704 |
StockBased Compensation (Tables
StockBased Compensation (Tables) | 9 Months Ended | 12 Months Ended |
Sep. 30, 2021 | Dec. 31, 2020 | |
Stock Options (Tables) | ||
Schedule of stock options plan | Number of Options Shares Exercise Price Range Per Share Weighted Average Exercise Price Balance, January 1, 2021 58,133,001 $ 0.005-1,121,250,000 $ 0.03704 Granted - - - Exercised (42,500,000 ) $ 0.005 $ 0.005 Expired - - - Balance outstanding, September 30, 2021 15,633,001 $ 0.005-1,121,250,000 $ 0.05084 Balance exercisable, September 30, 2021 15,633,001 $ 0.005-1,121,250,000 $ 0.05084 | Number of Options Shares Exercise Price Range Per Share Weighted Average Exercise Price Balance, January 1, 2019 519,001 $ 2.85-1,121,250,000 $ 3.125 Granted 115,000 2.05 2.05 Exercised - - - Expired (1,000 ) 8.00 8.00 Balance, December 31, 2019 633,001 2.05-1,121,250,000 2.93 Granted 57,500,000 0.005 0.005 Exercised - - - Expired - - - Balance outstanding, December 31, 2020 58,133,001 $ 0.005-1,121,250,000 $ 0.03704 Balance exercisable, December 31, 2020 5,031,908 $ 0.005-1,121,250,000 $ 0.03704 |
Schedule of stock option outstanding and exercisable | Options Outstanding Options Exercisable Range of Exercise Prices Number Outstanding Average Remaining Contractual Life (in years) Weighted Average Exercise Price Number Exercisable Average Remaining Contractual Life (in years) Weighted Average Exercise Price $ 1,121,250,000 1 2 $ 1,121,250,000 1 2 $ 1,121,250,000 $ 0.005 15,000,000 10 $ 0.005 15,000,000 10 $ 0.005 $ 2.85 126,000 7 $ 2.85 126,000 7 $ 2.85 $ 2.05 115,000 9 $ 2.05 115,000 9 $ 2.05 $ 3.125 392,000 6 $ 3.125 392,000 6 $ 3.125 $ 0.0041 - 975,000,000 15,633,001 6.8 $ 0.05084 15,633,001 6.8 $ 0.05084 | Options Outstanding Options Exercisable Range of Exercise Prices Number Outstanding Average Remaining Contractual Life (in years) Weighted Average Exercise Price Number Exercisable Average Remaining Contractual Life (in years) Weighted Average Exercise Price $1,121,250,000 1 2 $ 1,121,250,000 1 2 $ 1,121,250,000 $2.85 126,000 7 2.85 126,000 7 2.85 $3.125 392,000 6 3.125 392,000 6 3.125 $2.05 115,000 9 2.05 115,000 9 2.05 $0.005 57,500,000 10 0.005 4,398,907 10 0.005 $0.005 – 1,121,250,000 58,133,001 6.8 $ 0.03704 5,031,908 6.8 $ 0.03704 |
Income Tax Provision (Tables)
Income Tax Provision (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Income Tax Provision | |
Schedule of income tax provision | December 31, 2020 December 31, 2019 Federal Current $ - $ - Deferred - - State Current - 2,000 Deferred - - Income tax provision $ - $ 2,000 |
Schedule of reconcilliation of fedral statutory income tax rate | December 31, 2020 December 31, 2019 Federal statutory income tax rate 21.0 % 21.0 % State tax, net of federal benefit 5.0 % 5.0 % Change in valuation allowance on net operating loss carry-forwards (26.0 ) (26.0 ) Effective income tax rate 0.0 % 0.0 % |
Schedule of deferred tax assets and liabilities | December 31, 2020 December 31, 2019 Net deferred tax assets: Stock-based compensation $ 702,000 $ 561,000 Private placement costs 366,000 320,000 Operating lease liability 42,000 54,000 Loss on extinguishment of debt 1,697,000 438,000 Net operating loss carryforwards 5,946,000 5,431,000 Gross deferred tax assets 8,753,000 6,804,000 Less valuation allowance (7,255,000 ) (5,775,000 ) Total deferred tax assets 1,498,000 1,029,000 Deferred tax liabilities: Derivative gain 1,455,000 865,000 Debt discount 2,000 110,000 Operating lease right-of-use asset 41,000 54,000 Total deferred tax liabilities 1,498,000 1,029,000 Net deferred tax asset (liability) $ - $ - |
Organization and Summary of S_4
Organization and Summary of Significant Accounting Policies (Details) - USD ($) | 3 Months Ended | 9 Months Ended | 12 Months Ended | |||
Sep. 30, 2021 | Sep. 30, 2020 | Sep. 30, 2021 | Sep. 30, 2020 | Dec. 31, 2020 | Dec. 31, 2019 | |
Organization and Summary of Significant Accounting Policies | ||||||
Software | $ 39,000 | $ 49,000 | $ 148,000 | $ 156,000 | $ 200,000 | $ 764,000 |
Service | 1,000 | 2,000 | 5,000 | 6,000 | 7,000 | 4,000 |
Total revenue | $ 40,000 | $ 51,000 | $ 153,000 | $ 162,000 | $ 207,000 | $ 768,000 |
Organization and Summary of S_5
Organization and Summary of Significant Accounting Policies (Details 1) | 12 Months Ended |
Dec. 31, 2020 | |
Computer equipment [Member] | |
Estimated Useful Life (Years) | 5 years |
Furniture and fixtures [Member] | |
Estimated Useful Life (Years) | 7 years |
Computer software [Member] | |
Estimated Useful Life (Years) | 3 years |
Office equipment [Member] | |
Estimated Useful Life (Years) | 7 years |
Organization and Summary of S_6
Organization and Summary of Significant Accounting Policies (Details 2) - shares | 9 Months Ended | 12 Months Ended | ||
Sep. 30, 2021 | Sep. 30, 2020 | Dec. 31, 2020 | Dec. 31, 2019 | |
Organization and Summary of Significant Accounting Policies | ||||
Options to purchase common stock | 15,633,001 | 633,000 | 58,133,001 | 633,001 |
Warrants to purchase common stock | 68,981,234 | 738,810 | 27,405,476 | 100,574 |
Convertible notes | 21 | 229,203,829 | 1,156,304 | 1,554,866 |
Convertible Series B Preferred stock | 608,886 | 12,619,167 | 791,170 | 31,548 |
Total | 86,207,129 | 243,194,806 | 87,485,950 | 2,319,989 |
Organization and Summary of S_7
Organization and Summary of Significant Accounting Policies (Details Narrative) - USD ($) | 1 Months Ended | 3 Months Ended | 9 Months Ended | 12 Months Ended | |||||||
Mar. 31, 2021 | Sep. 30, 2021 | Sep. 30, 2020 | Sep. 30, 2021 | Sep. 30, 2020 | Dec. 31, 2020 | Dec. 31, 2019 | Jun. 30, 2021 | Nov. 13, 2020 | Jun. 30, 2020 | Dec. 31, 2018 | |
Net loss | $ (853,000) | $ (872,000) | $ (15,842,000) | $ (2,942,000) | $ (10,088,000) | $ (3,750,000) | |||||
Stockholders deficit | (10,668,000) | $ (15,607,000) | (10,668,000) | $ (15,607,000) | (14,342,000) | (15,464,000) | $ (12,428,000) | $ (15,644,000) | $ (13,802,000) | ||
Net cash used in operating activities | (2,014,000) | 2,256,000 | |||||||||
Cash | 3,180,000 | 3,180,000 | $ 162,000 | ||||||||
Percentage of sales decreased during period | 73.00% | ||||||||||
Derivative liabilities | 0 | 0 | $ 163,000 | $ 1,516,000 | |||||||
Notes payable aggregate amount | 3,417,000 | 3,417,000 | 3,604,000 | ||||||||
FDIC insured limit | $ 250,000 | $ 250,000 | $ 250,000 | ||||||||
Common stock, shares pursuant to an offering under regulation | 1,035,000 | 1,035,000 | 38,116,450 | 5,905,388 | 668,449,198 | ||||||
Cash received from sale of shares | $ 1,525,000 | ||||||||||
Allowance for doubtful debts | 20,000 | $ 20,000 | |||||||||
Advertising, sales and marketing costs | $ 2,000 | $ 8,000 | |||||||||
Proceeds from loan | $ 177,000 | $ 177,000 | |||||||||
One customer [Member] | |||||||||||
Accounts receivables | 63.00% | ||||||||||
Revenues | 35.00% | 72.00% | |||||||||
One customer [Member] | Accounts Receivable [Member] | |||||||||||
Concentration Risk, Percentage | 50.00% | 43.00% | |||||||||
One customer [Member] | Revenues [Member] | |||||||||||
Concentration Risk, Percentage | 72.00% | 58.00% | |||||||||
Three customer [Member] | |||||||||||
Revenues | 17.00% | ||||||||||
Three customer [Member] | Accounts Receivable [Member] | |||||||||||
Concentration Risk, Percentage | 10.00% | 12.00% | |||||||||
Three customer [Member] | Revenues [Member] | |||||||||||
Concentration Risk, Percentage | 14.00% | ||||||||||
Two customer [Member] | |||||||||||
Accounts receivables | 12.00% | ||||||||||
Revenues | 35.00% | 14.00% | |||||||||
Two customer [Member] | Accounts Receivable [Member] | |||||||||||
Concentration Risk, Percentage | 24.00% | 29.00% | |||||||||
Two customer [Member] | Revenues [Member] | |||||||||||
Concentration Risk, Percentage | 15.00% | 21.00% | |||||||||
SBA Paycheck Protection Program [Member] | |||||||||||
Proceeds from loan | $ 177,000 | ||||||||||
BST [Member] | |||||||||||
Ownership interest held by company | 49.00% | 49.00% | 49.00% | ||||||||
Ownership interest held by three executive officers | 31.00% | 31.00% | 31.00% | ||||||||
Percentages of revenue | 16.00% | ||||||||||
Noncontrolling interests percentage | 51.00% | 51.00% | 51.00% | ||||||||
Management fee per month | $ 36,000 | $ 36,000 | $ 36,000 | ||||||||
Financing milestone reached amount | 1,000,000 | 1,000,000 | |||||||||
Additional management fee owed amount | $ 5,000,000 | $ 5,000,000 | |||||||||
Management fee description | The Company and BST have a management agreement pursuant to which BST shall remit a management fee of $36,000 per month to the Company, and when BST reaches a milestone of $1,000,000 in financing, an additional management fee of $5,000,000 shall be owed to the Company, payable monthly over three years | The Company and BST have a management agreement pursuant to which BST shall remit a management fee of $36,000 per month to the Company, and when BST reaches a milestone of $1,000,000 in financing, an additional management fee of $5,000,000 shall be owed to the Company, payable monthly over three years. |
Property and Equipment (Details
Property and Equipment (Details) - USD ($) | Sep. 30, 2021 | Dec. 31, 2020 | Dec. 31, 2019 |
Property and equipment gross | $ 153,000 | $ 152,000 | |
Less accumulated depreciation | (151,000) | (147,000) | |
Property and equipment net | $ 0 | 2,000 | 5,000 |
Computer equipment [Member] | |||
Property and equipment gross | 82,000 | 82,000 | |
Furniture and fixtures [Member] | |||
Property and equipment gross | 10,000 | 10,000 | |
Computer software [Member] | |||
Property and equipment gross | 44,000 | 43,000 | |
Office equipment [Member] | |||
Property and equipment gross | $ 17,000 | $ 17,000 |
Property and Equipment (Detai_2
Property and Equipment (Details Narrative) - USD ($) | 12 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | |
Property and Equipment | ||
Depreciation expense | $ 4,000 | $ 5,000 |
Convertible Notes Payable (Deta
Convertible Notes Payable (Details) - USD ($) | Sep. 30, 2021 | Dec. 31, 2020 | Dec. 31, 2019 |
Secured | |||
(a) AL-Bank, in default | $ 543,000 | $ 543,000 | $ 543,000 |
Unsecured | |||
(b) Convertible notes with fixed conversion features, in default | 895,000 | 895,000 | 895,000 |
(c) Convertible notes with adjustable conversion prices | 0 | 45,000 | 845,000 |
Total convertible notes principal outstanding | 1,438,000 | 1,483,000 | 2,283,000 |
Debt discount | 0 | (14,000) | 423,000 |
Convertible notes, net of discount | $ 1,438,000 | $ 1,469,000 | $ 1,860,000 |
Convertible Notes Payable (De_2
Convertible Notes Payable (Details Narrative) - USD ($) | 3 Months Ended | 9 Months Ended | 12 Months Ended | ||||
Sep. 30, 2021 | Sep. 30, 2020 | Sep. 30, 2021 | Sep. 30, 2020 | Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Unamortized debt discount | $ 196,000 | $ 423,000 | $ 522,000 | ||||
Fair value of the warrants | $ 53,000 | $ 53,000 | |||||
Maturity date description | Maturing October 2020 and December 2021 | maturing between March 2020 and April 2021 | |||||
Fair value of warrant granted | $ 2,657,000 | $ 53,000 | |||||
Warrants issued to purchase common shares | 638,000 | 638,000 | |||||
Fair value of derivative liabilities | $ 742,000 | $ 742,000 | |||||
Direct fees | 8,000 | $ 8,000 | |||||
Interest rate decriptions | The notes are unsecured, bear interest at a rate starting at 8% up to 18% per annum | The notes bears interest at a rate starting from 31.8% to 148% per annum, each agreement secured by substantially all of the assets of the Company | |||||
Convertible notes payable, outstanding balance | $ 845,000 | 695,000 | |||||
Proceeds from convertible notes payable | 0 | $ 689,000 | $ 803,000 | 985,000 | |||
Debt instrument, debt discount | $ 1,727,000 | ||||||
Debt instrument, conversion price description | At the option of the holder, the notes are convertible into shares of common stock of the Company at a price per share discount of 58% to 70% of the market price of the Company’s common stock, as defined, for 15 to 25 days preceding a conversion notice. | ||||||
Private placement costs | $ 0 | $ 37,000 | 0 | (140,000) | $ 175,000 | 803,000 | |
Debt discount amortization | (605,000) | 1,047,000 | |||||
Initial fair value of the embedded conversion feature | 917,000 | ||||||
Fair value of common stock shares | 5,368,000 | $ 0 | 976,000 | 0 | |||
Convertible notes payable, outstanding balance | 1,438,000 | 1,438,000 | 1,469,000 | 1,860,000 | |||
(a) DART/Citco Global, in default | 543,000 | 543,000 | $ 543,000 | 543,000 | |||
Unsecured Convertible Notes Payable [Member] | |||||||
Fair value of the warrants | $ 60,000 | ||||||
Maturity date description | maturing through December 2019. | ||||||
Fair value of warrant granted | $ 60,000 | ||||||
Warrants issued to purchase common shares | 100,575 | ||||||
Fair value of derivative liabilities | $ 925,000 | ||||||
Interest rate decriptions | The notes bear interest at 8% to 10% per annum | The notes bear interest at a rate of 8% to 10% per annum | |||||
Proceeds from convertible notes payable | $ 985,000 | ||||||
Debt instrument, debt discount | 985,000 | ||||||
Private placement costs | $ 803,000 | 803,000 | |||||
Debt discount amortization | 925,000 | ||||||
Initial fair value of the embedded conversion feature | $ 1,728,000 | ||||||
Conversion description | At the option of the holder, the notes are convertible into shares of common stock of the Company at a price per share discount of 58% to 70% of the market price of the Company’s common stock, as defined, for 15 to 25 days preceding a conversion notice | At the option of the holder, the notes are convertible into shares of common stock of the Company at a price per share discount of 58% to 62% of the market price of the Company’s common stock, as defined, for 15 to 25 days preceding a conversion notice. | |||||
Interest rate | 10.00% | ||||||
Debt instrument, description | Company at a price per share discount of 58% of the lowest closing market price of the Company’s common stock during the twenty days preceding a conversion notice. | ||||||
Convertible Notes Payable [Member] | |||||||
Unamortized debt discount | 14,000 | 14,000 | $ (614,000) | ||||
Proceeds from convertible notes payable | 472,000 | ||||||
Debt instrument, debt discount | 1,035,000 | 1,687,000 | 835,000 | ||||
Debt discount amortization | 598,000 | $ 851,000 | |||||
Initial fair value of the embedded conversion feature | 382,000 | 3,249,000 | |||||
Fair value of common stock shares | 9,112,000 | ||||||
Convertible notes payable, outstanding balance | 45,000 | 45,000 | 45,000 | ||||
Debt instrument, forgiveness amount | $ 506,000 | ||||||
Unpaid interest fees | 4,000 | $ 4,000 | |||||
Common stock shares issued upon conversion of debt | 16,168,589 | ||||||
Debt instrument converted amount, shares issued | 1 | 233,748,884 | 1,157,829 | ||||
Debt instrument converted amount, value | $ 1,035,000 | $ 1,181,000 | $ 892,000 | ||||
Loss on extinguishment of debt | 618,000 | 4,790,000 | 134,000 | ||||
Debt instrument, accrued interest | $ 49,000 | 34,000 | 892,000 | ||||
Debt instrument converted amount, interest | 93,000 | 57,000 | |||||
Derivative liability related to conversion of common stock | 2,007,000 | ||||||
Debt and conversion feature liability | 1,214,000 | ||||||
2005 Through 2007 [Member] | |||||||
Maturity date description | due on various dates from March 2008 to March 2015, and are currently in default. | ||||||
Interest rate decriptions | The notes are unsecured, bear interest at a rate starting at 8% up to 18% per annum | ||||||
Proceeds from convertible notes payable | $ 895,000 | 895,000 | |||||
Convertible notes payable, outstanding balance | 895,000 | 895,000 | 895,000 | $ 895,000 | |||
2005 [Member] | |||||||
(a) DART/Citco Global, in default | $ 543,000 | $ 543,000 | $ 543,000 | ||||
Interest rate | 7.50% | 7.50% | |||||
Conversion price | $ 3.25 | $ 3.25 | $ 3.25 | ||||
Total | $ 400,000 | $ 400,000 | |||||
Monyhly payment | 10,000 | ||||||
Remaining balance | $ 143,000 |
Convertible Notes Payable Rel_2
Convertible Notes Payable Related Parties (Details Narrative) - USD ($) | 9 Months Ended | 12 Months Ended | ||
Sep. 30, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Convertible notes payable, outstanding balance | $ 268,000 | $ 298,000 | $ 356,000 | $ 356,000 |
Six Notes [Member] | ||||
Convertible notes | 268,000 | $ 268,000 | ||
Interest rate | 8.00% | |||
Six Notes [Member] | Chief Technology Officer [Member] | ||||
Repayments of note payable | $ 30,000 | |||
Convertible notes | $ 30,000 | |||
Interest rate | 8.00% | 8.00% | ||
Companys VP of Technology [Member] | ||||
Extinguishment of debt | $ 58,000 |
Notes Payable (Details)
Notes Payable (Details) - USD ($) | Sep. 30, 2021 | Dec. 31, 2020 | Dec. 31, 2019 |
Unsecured notes payable-in default | |||
(a) Notes payable-in default | $ 1,639,000 | $ 1,699,000 | $ 1,639,000 |
(b) Notes payable issued by BST-in default | 310,000 | 475,000 | 475,000 |
(c) Note payable-PPP loan | 177,000 | 313,000 | 0 |
(d) Note payable-EID loan | 150,000 | 150,000 | 0 |
Secured notes payable | |||
Notes payable | 29,000 | 128,000 | 272,000 |
Total notes payable principal outstanding | 2,305,000 | 2,765,000 | 2,386,000 |
Debt discount | 0 | (52,000) | 0 |
Less current portion of notes payable | (1,978,000) | (2,250,000) | (2,238,000) |
Long term notes payable | $ 327,000 | $ 463,000 | $ 148,000 |
Notes Payable (Details Narrativ
Notes Payable (Details Narrative) - USD ($) | May 15, 2020 | Apr. 07, 2020 | Mar. 31, 2021 | Sep. 30, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 |
Note payable default | 460,829 | ||||||
PPP laon | $ 177,000 | ||||||
Unamortized debt discount | $ 196,000 | $ 423,000 | $ 522,000 | ||||
Debt discount amortization | $ 196,000 | ||||||
Aggregate amount of paycheck protection | $ 313,000 | 313,000 | 313,000 | ||||
Gain on extinguish of PPP | 12,000 | ||||||
Notes payable exchanged | 100,000 | ||||||
Proceeds from loan | $ 177,000 | 177,000 | |||||
Amount payable | 99,000 | ||||||
Accrued interest on PPP | 4,000 | ||||||
Obligation on debt settlement | 65,000 | 21,000 | |||||
Notes payable, outstanding balance | 310,000 | $ 475,000 | 775,000 | ||||
PPP maturity date | Apr. 7, 2022 | Apr. 7, 2025 | |||||
PPP interest rate | 1.00% | 1.00% | |||||
Secured notes payable | 29,000 | ||||||
Note holder descriptions | 5,000 of the notes were paid, and note holders agreed to exchange $296,000 of notes payable into a financing obligation | ||||||
Unsecured promissory note | $ 475,000 | ||||||
Note issued | $ 152,000 | $ 316,000 | |||||
Interest rate decriptions | The notes are unsecured, bear interest at a rate starting at 8% up to 18% per annum | The notes bears interest at a rate starting from 31.8% to 148% per annum, each agreement secured by substantially all of the assets of the Company | |||||
Maturity date description | Maturing October 2020 and December 2021 | maturing between March 2020 and April 2021 | |||||
Debt instruments, principal payment | $ 275,000 | $ 44,000 | |||||
Outstanding balance of secured note | 128,000 | 272,000 | |||||
Notes payable, outstanding balance | $ 29,000 | $ 128,000 | 272,000 | ||||
Warrants issued to purchase common shares | 638,000 | 638,000 | |||||
Fair value of warrants | $ 53,000 | $ 53,000 | |||||
EID Loan [Member] | |||||||
Notes payable, outstanding balance | 150,000 | $ 150,000 | |||||
Economic Injury Disaster Loan [Member] | |||||||
Loan borrowed amount | $ 150,000 | ||||||
Interest rate on loan | 3.75% | ||||||
Monthly payment on loan, description | Monthly principal and interest payments of $0.7 per month | ||||||
One Note [Member] | |||||||
Maturity date | July 2020 | ||||||
Note issued | 88,000 | $ 32,000 | $ 468,000 | ||||
Secured notes payable | $ 21,000 | ||||||
Interest rate of notes | 148.00% | 8.00% | |||||
Notes payable, outstanding balance | 5,000 | $ 128,000 | |||||
Principal amount | 319,000 | ||||||
Notes Payable [Member] | |||||||
Unamortized debt discount | 29,000 | $ 52,000 | |||||
Obligation on debt settlement | $ 60,000 | ||||||
Interest rate decriptions | The notes are unsecured, bear interest at a rate of 8% through 14% per annum | The notes are unsecured, bears interest at a rate of 8% through 14% per annum | |||||
Maturity date description | matured starting in fiscal 2011 up to July 2017 | ||||||
Debt instrument, interest rate | 12.00% | ||||||
Maturity date | November 2021 | ||||||
Notes payable, outstanding balance | $ 1,699,000 | $ 1,699,000 | $ 1,639,000 | $ 1,639,000 | |||
Notes payable in default | 1,639,000 | ||||||
Amortized debt discount | $ 52,000 | ||||||
Note issued upon exchange for cash | $ 60,000 | ||||||
Warrants issued to purchase common shares | 26,666,666 | ||||||
Warrants, exercise price | $ 0.005 | ||||||
Fair value of warrants | $ 60,000 | ||||||
Unsecured Convertible Notes Payable [Member] | |||||||
Interest rate decriptions | The notes bear interest at 8% to 10% per annum | The notes bear interest at a rate of 8% to 10% per annum | |||||
Maturity date description | maturing through December 2019. | ||||||
Debt instrument, interest rate | 8.00% | ||||||
Maturity date | September 2019 | ||||||
Warrants issued to purchase common shares | 100,575 | ||||||
Fair value of warrants | $ 60,000 |
Notes Payable Related Parties (
Notes Payable Related Parties (Details Narrative) - USD ($) | 9 Months Ended | 12 Months Ended | ||
Sep. 30, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Notes payable | $ 693,000 | $ 952,000 | $ 743,000 | |
Note issued | $ 152,000 | 316,000 | ||
Chief Executive Officer [Member] | ||||
Notes payable | $ 743,000 | $ 743,000 | ||
Due date | December 31, 2021 | December 31, 2021 | ||
Payment for debt instrument | $ 259,000 | $ 54,000 | ||
Notes payable issued to related party | $ 693,000 | $ 263,000 | ||
Interest rate | 7.00% | |||
Proceeds from unsecured notes | $ 753,000 | |||
Chief Executive Officer [Member] | Maximum [Member] | ||||
Interest rate | 0.00% | |||
Chief Executive Officer [Member] | Minimum [Member] | ||||
Interest rate | 10.00% | |||
Chief Executive Officer [Member] | One Note [Member] | ||||
Due date | December 31, 2021 | |||
Note issued | $ 753,000 | |||
Chief Executive Officer [Member] | Two Note [Member] | ||||
Note issued | $ 199,000 |
Financing Obligation (Details N
Financing Obligation (Details Narrative) - USD ($) | 9 Months Ended | 12 Months Ended | ||
Sep. 30, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Financing obligation | $ 1,263,000 | $ 1,263,000 | $ 1,263,000 | |
BST [Member] | ||||
Financing obligation | $ 1,263,000 | $ 1,263,000 | 1,263,000 | |
Financing obligation description | as the tokens do not exist, and any amounts received for tokens are not considered equity or revenue, management determined that 100% of the obligation of $1,263,000 is a liability to be settled by BST | At December 31, 2020, as the tokens do not exist, and any amounts received for tokens are not considered equity or revenue, management determined that 100% of the obligation of $1,263,000 is a liability to be settled by BST, through the issuance of tokens, or through other means if tokens are never issued. | ||
Promissory note - various parties [Member] | Related Party [Member] | ||||
Tokens issued to unrelated parties | 122,000 | |||
Financing obligation | $ 315,000 | |||
Unsecured Convertible Notes Payable [Member] | ||||
Promissory note issued to unrelated parties | $ 776,000 | |||
Tokens issued to unrelated parties | 50,000 | |||
Financing obligation | $ 826,000 |
Contingent Payment Obligation (
Contingent Payment Obligation (Details Narrative) - USD ($) | Sep. 06, 2017 | Sep. 30, 2021 | Dec. 31, 2020 | Dec. 31, 2019 |
Contingent payment obligation | $ 1,500,000 | $ 1,500,000 | $ 1,500,000 | |
Litigation funding agreement [Member] | Therium Inc. and VGL Capital, LLC [Member] | ||||
Contingent payment obligation | $ 1,500,000 | |||
Gross proceeds | $ 1,500,000 | |||
Contingent obligation, description | gross proceeds of any claims awarded, 10% of any additional claim proceeds until the Funders have received an additional $7,500,000, and 2.5% of any claim proceeds thereafter |
Debt Settlement Obligation (Det
Debt Settlement Obligation (Details Narrative) - USD ($) | 9 Months Ended | 12 Months Ended | ||
Sep. 30, 2021 | Sep. 30, 2020 | Dec. 31, 2020 | Dec. 31, 2019 | |
Convertible note, accrued interest, and accounts payable assumed by debt settlement obligation | $ 0 | $ 198,000 | $ 198,000 | $ 0 |
Common stock shares issued during the period for settlement | 38,116,450 | |||
Proceeds from issuance of common stock | $ 5,368,000 | $ 0 | $ 976,000 | $ 0 |
May 13, 2020 [Member] | Continuation Capital, Inc [Member] | ||||
Convertible note, accrued interest, and accounts payable assumed by debt settlement obligation | $ 198,000 | |||
Common stock shares issued during the period for settlement | 35,967,234 | |||
Proceeds from issuance of common stock | $ 459,000 | |||
loss on extinguishment of debt | 261,000 | |||
May 13, 2020 [Member] | Continuation Capital, Inc [Member] | Convertible Debt [Member] | ||||
Convertible note, accrued interest, and accounts payable assumed by debt settlement obligation | 140,000 | |||
May 13, 2020 [Member] | Continuation Capital, Inc [Member] | Secured notes payable [Member] | ||||
Convertible note, accrued interest, and accounts payable assumed by debt settlement obligation | 29,000 | |||
Accounts Payable [Member] | May 13, 2020 [Member] | Continuation Capital, Inc [Member] | ||||
Convertible note, accrued interest, and accounts payable assumed by debt settlement obligation | $ 29,000 |
Derivative Financial Instrume_3
Derivative Financial Instruments (Details) - USD ($) | 9 Months Ended | 12 Months Ended | |
Sep. 30, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Risk-free interest rate | 0.08% | 0.09% | 1.59% |
Expected volatility | 424.00% | ||
Expected life (in years) | 4 months 28 days | ||
Expected dividend yield | 0.00% | 0.00% | |
Fair Value: | |||
Conversion feature | $ 382,000 | $ 163,000 | $ 1,516,000 |
Maximum [Member] | |||
Expected volatility | 691.00% | 155.00% | |
Expected life (in years) | 6 months 25 days | 1 year | |
Minimum [Member] | |||
Expected volatility | 495.00% | 145.00% | |
Expected life (in years) | 3 months | 3 months | |
Dates of Inception [Member] | |||
Expected life (in years) | 1 year | ||
Fair Value: | |||
Conversion feature | $ 917,000 | ||
Dates of Inception [Member] | Maximum [Member] | |||
Risk-free interest rate | 0.65% | ||
Expected volatility | 277.00% | ||
Dates of Inception [Member] | Minimum [Member] | |||
Risk-free interest rate | 0.11% | ||
Expected volatility | 152.00% |
Derivative Financial Instrume_4
Derivative Financial Instruments (Details 1) - USD ($) | 9 Months Ended | 12 Months Ended | ||
Sep. 30, 2021 | Sep. 30, 2020 | Dec. 31, 2020 | Dec. 31, 2019 | |
Debt Settlement Obligation (Details Narrative) | ||||
Fair value at beginning of period | $ 163,000 | $ 1,516,000 | $ 1,516,000 | $ 1,314,000 |
Recognition of derivative liabilities upon initial valuation | 0 | 776,000 | 917,000 | 1,727,000 |
Extinguishment of derivative liabilities | 382,000 | 1,337,000 | 3,460,000 | (1,214,000) |
Net change in the fair value of derivative liabilities | 219,000 | (165,000) | 1,190,000 | (311,000) |
Fair value at end of period | $ 0 | $ 790,000 | $ 163,000 | $ 1,516,000 |
Derivative Financial Instrume_5
Derivative Financial Instruments (Details Narrative) - USD ($) | 9 Months Ended | 12 Months Ended | ||
Sep. 30, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Debt Settlement Obligation (Details Narrative) | ||||
Derivative liabilities | $ 382,000 | $ 163,000 | $ 1,516,000 | $ 1,314,000 |
Change in fair value of derivative liabilities | 219,000 | 1,190,000 | 311,000 | |
Decrease in derivative liability | $ 382,000 | 3,460,000 | 1,214,000 | |
Conversion features | $ 917,000 | $ 1,727,000 |
Operating Lease (Details)
Operating Lease (Details) - USD ($) | 9 Months Ended | 12 Months Ended | ||
Sep. 30, 2021 | Sep. 30, 2020 | Dec. 31, 2020 | Dec. 31, 2019 | |
Lease Cost | ||||
Operating lease cost (included in general and administration in the Company's statement of operations) | $ 42,000 | $ 42,000 | $ 56,000 | $ 56,000 |
Other Information | ||||
Cash paid for amounts included in the measurement of lease liabilities | $ 42,000 | $ 41,000 | $ 55,000 | $ 53,000 |
Weighted average remaining lease term - operating leases (in years) | 2 years 3 months 18 days | 3 years 3 months 18 days | 3 years 1 month 6 days | 4 years 1 month 6 days |
Average discount rate - operating leases | 10.00% | 10.00% | 10.00% | 4.00% |
Operating Lease (Details 1)
Operating Lease (Details 1) - USD ($) | Sep. 30, 2021 | Dec. 31, 2020 | Dec. 31, 2019 |
Operating leases | |||
Long-term right-of-use assets | $ 120,000 | $ 157,000 | $ 206,000 |
Short-term operating lease liabilities | 39,000 | 38,000 | 47,000 |
Long-term operating lease liabilities | 86,000 | 125,000 | $ 162,000 |
Total operating lease liabilities | $ 125,000 | $ 163,000 |
Operating Lease (Details 2)
Operating Lease (Details 2) - USD ($) | Sep. 30, 2021 | Dec. 31, 2020 |
Operating Lease (Details) | ||
2021 | $ 56,000 | |
2021 (remaining 3 months) | $ 14,000 | |
2022 | 58,000 | 58,000 |
2023 | 59,000 | 59,000 |
2024 | 5,000 | 5,000 |
Total lease payments | 136,000 | 178,000 |
Less: Imputed interest/present value discount | (11,000) | 15,000 |
Present value of lease liabilities | $ 125,000 | $ 163,000 |
Operating Lease (Details Narrat
Operating Lease (Details Narrative) - USD ($) | 9 Months Ended | 12 Months Ended | ||
Sep. 30, 2021 | Sep. 30, 2020 | Dec. 31, 2020 | Dec. 31, 2019 | |
Operating Lease (Details) | ||||
Operating lease payments, monthly | $ 4,000 | $ 4,000 | ||
Lease expenses | $ 42,000 | $ 42,000 | $ 56,000 | $ 52,000 |
Remaining operating lease term | 3 years 29 days | |||
Operating lease description | payments increasing 3% each year, and ending on January 31, 2024. |
Stockholders Deficit (Details)
Stockholders Deficit (Details) - USD ($) | 9 Months Ended | 12 Months Ended | |
Sep. 30, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Number of Warrant Shares | |||
Number of warrants Beginning balance | 27,405,475 | 100,574 | |
Number of warrants Granted | $ 5,500,000 | $ 27,304,901 | $ 100,574 |
Number of warrants Exercised | $ (13,424,241) | $ 0 | $ 0 |
Number of warrants Outstsnding Ending | 68,981,234 | 27,405,475 | 100,574 |
Number of warrants exercisable Ending | 68,981,234 | 27,405,475 | |
Exercise price range per share, Granted | $ 0.05 | $ 0.0045 | |
Weighted Average Exercise Price | |||
Weighted Average Exercise Price Beginning Balance | 0.013132 | 1.1185 | |
Weighted Average Exercise Price, Granted | 0.05 | 0.0045 | $ 1.1185 |
Weighted Average Exercise Price Outstanding Ending Balacce | 0.042114 | 0.011676 | 1.1185 |
Weighted Average Exercise Price Exercisable Ending Balacce | 0.042114 | 0.011676 | |
Maximum [Member] | |||
Number of Warrant Shares | |||
Exercise price range per share, Granted | 2.90 | ||
Weighted Average Exercise Price | |||
Exercise Price Range Per Share, Beginning balance | 2.90 | 2.90 | |
Exercise Price Range Per Share Outstanding Ending | 2.90 | 2.90 | 2.90 |
Exercise Price Range Per Share Exercisable Ending balance | 2.90 | 2.90 | |
Minimum [Member] | |||
Number of Warrant Shares | |||
Exercise price range per share, Granted | 0.75 | ||
Weighted Average Exercise Price | |||
Exercise Price Range Per Share, Beginning balance | 0.0045 | 0.75 | |
Exercise Price Range Per Share Outstanding Ending | 0.0045 | 0.0045 | $ 0.75 |
Exercise Price Range Per Share Exercisable Ending balance | $ 0.0045 | $ 0.0045 |
Stockholders Deficit (Details 1
Stockholders Deficit (Details 1) - $ / shares | 9 Months Ended | 12 Months Ended |
Sep. 30, 2021 | Dec. 31, 2020 | |
Warrant [Member] | ||
Average Remaining Contractual Life (in years) | 4 years | 5 years |
Weighted Average Exercise Price | $ 0.0045 | $ 0.0045 |
Number Outstanding | 13,349,242 | 26,666,666 |
Range of Exercise Prices | $ 0.0045 | $ 0.0045 |
Warrant One [Member] | ||
Average Remaining Contractual Life (in years) | 4 years | 5 years |
Weighted Average Exercise Price | $ 0.085 | $ 0.085 |
Number Outstanding | 588,235 | 588,235 |
Range of Exercise Prices | $ 0.085 | $ 0.085 |
Warrant Two [Member] | ||
Average Remaining Contractual Life (in years) | 5 years | 5 years |
Weighted Average Exercise Price | $ 0.05 | $ 0.75 |
Number Outstanding | 55,000,000 | 133,333 |
Range of Exercise Prices | $ 0.05 | $ 0.75 |
Warrant Three [Member] | ||
Average Remaining Contractual Life (in years) | 3 years | 5 years |
Weighted Average Exercise Price | $ 0.75 | $ 2.90 |
Number Outstanding | 26,515 | 17,241 |
Range of Exercise Prices | $ 0.75 | $ 2.90 |
Warrant Total [Member] | ||
Average Remaining Contractual Life (in years) | 4 years | 5 years |
Weighted Average Exercise Price | $ 0.013132 | $ 0.011676 |
Number Outstanding | 68,981,234 | 27,405,475 |
Warrant Total [Member] | Maximum [Member] | ||
Range of Exercise Prices | $ 2.90 | $ 2.90 |
Warrant Four [Member] | ||
Average Remaining Contractual Life (in years) | 3 years | |
Weighted Average Exercise Price | $ 2.90 | |
Number Outstanding | 17,242 | |
Range of Exercise Prices | $ 2.90 | |
Warrant Total [Member] | Minimum [Member] | ||
Range of Exercise Prices | $ 0.0045 | $ 0.0045 |
Stockholders Deficit (Details N
Stockholders Deficit (Details Narrative) - USD ($) | Nov. 13, 2020 | Jan. 10, 2011 | Sep. 30, 2021 | Sep. 30, 2020 | Sep. 30, 2021 | Sep. 30, 2020 | Dec. 31, 2020 | Dec. 31, 2019 |
Common Stock, shares issued | 668,449,198 | 1,035,000 | 1,035,000 | 38,116,450 | 5,905,388 | |||
Intrinsic value of warrants | $ 2,657,000 | $ 53,000 | ||||||
Warrant exercise upon exchange of common stock | 12,349,726 | |||||||
Fair value of common stock issued for services, Value | $ 6,569,000 | |||||||
Fair value of shares issued | $ 2,315,000 | |||||||
Proceed from exercise of warrant grant | 13,333,333 | |||||||
warrant shares granted to financing entity | 90,908 | |||||||
Fair value of common stock issued for services, Shares | 45,150,500 | |||||||
Fair value of common stock | $ 36,000 | $ 36,000 | ||||||
Common stock, aggregate shares issued during period | 137,177,418 | |||||||
Fair value of convertible note issued | $ 0 | $ 689,000 | 803,000 | $ 985,000 | ||||
Note issued | 152,000 | $ 316,000 | ||||||
Debt instrument, debt discount | $ 1,727,000 | |||||||
Warrants issued to purchase common shares | 638,000 | 638,000 | ||||||
Common stock shares issued during the period, amount | $ 1,525,000 | |||||||
Common stock shares issued during the period, shares | 38,116,450 | |||||||
Net proceeds from common stock | $ 1,525,000 | |||||||
Preferred stock, shares authorized | 10,000,000 | 10,000,000 | 10,000,000 | 10,000,000 | ||||
Preferred stock, par value | $ 0.10 | $ 0.10 | $ 0.10 | $ 0.10 | ||||
Preferred stock value | $ 0 | $ 0 | $ 0 | $ 0 | ||||
Preferred stock, shares outstanding | 0 | 0 | 0 | 0 | ||||
Common stock issued for services, amount | $ 9,000 | $ 0 | $ 66,000 | $ 20,000 | ||||
Common stock shares authorized | 4,000,000,000 | 4,000,000,000 | 4,000,000,000 | 4,000,000,000 | ||||
Series A Preferred Stock [Member] | ||||||||
Preferred stock, shares designated | 100 | |||||||
Preferred stock value | $ 329,000 | |||||||
Aggregate amount | $ 987,000 | |||||||
Series B Preferred Stock [Member] | ||||||||
Preferred stock, shares designated | 100,000,000 | |||||||
Preferred stock, description | such liquidation rights to be paid from the assets of the Company not delegated to parties with greater priority at $1.00 per share or, in the event an aggregate subscription by a single subscriber of the Series B Preferred Stock is greater than $100,000,000, $0.997 per share. | |||||||
Initial price of preferred stock | $ 2.50 | |||||||
Preferred stock, shares outstanding | 36,667 | 36,667 | ||||||
January and July 2020 [Member] | Convertible Notes Payable One [Member] | ||||||||
Fair value of convertible note issued | $ 100,000 | |||||||
Note issued | $ 60,000 | |||||||
Maturity period | 5 years | |||||||
Debt instrument, debt discount | $ 118,000 | |||||||
Warrants issued to purchase common shares | 27,304,901 | |||||||
Conversion price | $ 0.0045 | |||||||
Exercise price | $ 0.75 | |||||||
January 2021 [Member] | ||||||||
Common stock shares issued during the period, amount | $ 66,000 | |||||||
Common stock shares issued during the period, shares | 881,550 | |||||||
Sale of common stock shares | 119,666,450 | |||||||
Common stock shares issued upon debt settlement amount | $ 88,000 | |||||||
Common stock shares issued upon conversion of debt | 16,168,589 | |||||||
Common stock shares issued upon debt settlement | 460,829 | |||||||
Net proceeds from common stock | $ 5,368,000 | |||||||
October, 21 2010 [Member] | ||||||||
Preferred stock, shares authorized | 10,000,000 | |||||||
Preferred stock, par value | $ 0.10 | |||||||
Additional shares of preferred stock authorized | 10,000,000 | |||||||
November 2020 [Member] | ||||||||
Common stock, aggregate shares issued during period | 718,337,380 | |||||||
Sale of common stock shares | 436,337,203 | |||||||
Common stock shares issued upon conversion of debt | 233,748,884 | 1,157,829 | ||||||
Common stock shares issued upon debt settlement | 35,967,234 | |||||||
Net proceeds from common stock | $ 976,000 | |||||||
Common stock issued for services, shares | 6,378,671 | 60 | ||||||
Common stock issued for services, amount | $ 39,000 | |||||||
Common stock shares authorized | 4,000,000,000 |
Stock Options (Details)
Stock Options (Details) - $ / shares | 9 Months Ended | 12 Months Ended | |
Sep. 30, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Exercise Price Range Per Share granted | $ 0.05 | $ 0.0045 | |
Minimum [Member] | |||
Exercise Price Range Per Share granted | $ 0.75 | ||
Maximum [Member] | |||
Exercise Price Range Per Share granted | $ 2.90 | ||
Stock Option [Member] | |||
Number of Options Shares beginning balance | 58,133,001 | 633,001 | 519,001 |
Number of Options Shares granted | 57,500,000 | 115,000 | |
Number of Options Shares exercised | (42,500,000) | ||
Number of Options Shares expired | (1,000) | ||
Number of Options Shares ending balance | 15,633,001 | 58,133,001 | 633,001 |
Number of Options Shares ending exercisable | 15,633,001 | 4,398,907 | |
Weighted Average Exercise Price beginning balance | $ 0.03704 | $ 2.93 | $ 3.125 |
Weighted Average Exercise Price granted | 0.005 | 2.05 | |
Weighted Average Exercise Price exercised | 0.005 | ||
Exercise Price Range Per Share granted | 0.005 | 2.05 | |
Exercise Price Range Per Share expired | 8 | ||
Weighted Average Exercise Price expired | 8 | ||
Weighted Average Exercise Price ending balance | 0.05084 | 0.03704 | 2.93 |
Weighted Average Exercise Price ending exercisable | 0.05084 | 0.03704 | |
Stock Option [Member] | Minimum [Member] | |||
Exercise Price Range Per Share beginning balance | 0.005 | 2.05 | 2.85 |
Exercise Price Range Per Share ending balance | 0.005 | 0.005 | 2.05 |
Exercise Price Range Per Share ending exercisable balance | 0.005 | 0.005 | |
Stock Option [Member] | Maximum [Member] | |||
Exercise Price Range Per Share beginning balance | 1,121,250,000 | 1,121,250,000 | 1,121,250,000 |
Exercise Price Range Per Share ending balance | 1,121,250,000 | 1,121,250,000 | $ 1,121,250,000 |
Exercise Price Range Per Share ending exercisable balance | $ 1,121,250,000 | $ 1,121,250,000 |
Stock Options (Details 1)
Stock Options (Details 1) - $ / shares | 9 Months Ended | 12 Months Ended |
Sep. 30, 2021 | Dec. 31, 2020 | |
Options Outstanding [Member] | ||
Number of warrants outstanding | 15,633,001 | 58,133,001 |
Weighted average remaining contractual life (years) | 6 years 9 months 18 days | 6 years 9 months 18 days |
Weighted average exercise price | $ 0.05084 | $ 0.03704 |
Option Exercisable [Member] | ||
Weighted average exercise price | $ 0.05084 | $ 0.03704 |
Weighted average remaining contractual life (years) | 6 years 9 months 18 days | 6 years 9 months 18 days |
Number of warrants exercisable | 15,633,001 | 5,031,908 |
Exercise Prices [Member] | Options Outstanding [Member] | ||
Weighted average exercise price | $ 1,121,250,000 | $ 1,121,250,000 |
Number of warrants outstanding | 1 | 1 |
Weighted average remaining contractual life (years) | 2 years | 2 years |
Exercise Prices [Member] | Option Exercisable [Member] | ||
Weighted average exercise price | $ 1,121,250,000 | $ 1,121,250,000 |
Weighted average remaining contractual life (years) | 2 years | 2 years |
Number of warrants exercisable | 1 | 1 |
Exercise Prices One [Member] | Options Outstanding [Member] | ||
Number of warrants outstanding | 15,000,000 | 126,000 |
Weighted average remaining contractual life (years) | 10 years | 7 years |
Weighted average exercise price | $ 0.005 | $ 2.85 |
Exercise Prices One [Member] | Option Exercisable [Member] | ||
Weighted average remaining contractual life (years) | 10 years | 7 years |
Weighted average exercise price | $ 0.005 | $ 2.85 |
Number of warrants exercisable | 15,000,000 | 126,000 |
Exercise Prices Two [Member] | Options Outstanding [Member] | ||
Number of warrants outstanding | 126,000 | 392,000 |
Weighted average remaining contractual life (years) | 7 years | 6 years |
Weighted average exercise price | $ 2.85 | $ 3.125 |
Exercise Prices Two [Member] | Option Exercisable [Member] | ||
Weighted average exercise price | $ 2.85 | $ 3.125 |
Weighted average remaining contractual life (years) | 7 years | 6 years |
Number of warrants exercisable | 126,000 | 392,000 |
Exercise Prices Three [Member] | Options Outstanding [Member] | ||
Number of warrants outstanding | 115,000 | 115,000 |
Weighted average remaining contractual life (years) | 9 years | 9 years |
Weighted average exercise price | $ 2.05 | $ 2.05 |
Exercise Prices Three [Member] | Option Exercisable [Member] | ||
Weighted average exercise price | $ 2.05 | $ 2.05 |
Weighted average remaining contractual life (years) | 9 years | 9 years |
Number of warrants exercisable | 115,000 | 115,000 |
Exercise Prices Four [Member] | Options Outstanding [Member] | ||
Weighted average exercise price | $ 3.125 | $ 0.005 |
Number of warrants outstanding | 392,000 | 57,500,000 |
Weighted average remaining contractual life (years) | 6 years | 10 years |
Exercise Prices Four [Member] | Option Exercisable [Member] | ||
Weighted average exercise price | $ 3.125 | $ 0.005 |
Number of warrants exercisable | 392,000 | 57,500,000 |
Weighted average remaining contractual life (years) | 6 years | 10 years |
Stock Options (Details Narrativ
Stock Options (Details Narrative) - USD ($) | 9 Months Ended | 12 Months Ended | |
Sep. 30, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Volatility rate | 424.00% | ||
Expected life | 4 months 28 days | ||
Stock Option [Member] | |||
Stock compensation expense, Additional | $ 2,712,000 | ||
Common stock, shares issued upon cashless exercise of options | 39,955,655 | ||
Options, exercises during period | 42,500,000 | ||
Stock Option [Member] | February 2021 [Member] | |||
Options, Outstanding, Average Intrinsic Value | $ 1,168,000 | ||
Share based compensation | $ 3,675,000 | ||
Stock option granted | 12,250,000 | ||
Stock Option [Member] | November 2012 [Member] | |||
Share based compensation | $ 506,000 | $ 21,000 | |
Stock option granted | 57,500,000 | 115,000 | |
Options outstanding, estimated life | 10 years | 10 years | |
Increase the number of shares, descriptions | The number of shares authorized for issuance under the plan was 100,000,000 and was increased to 400,000,000 in November 2017 by unanimous consent of the Board of Directors. | ||
Stock option, exercise price | $ 0.005 | $ 2.05 | |
Volatility rate | 604.00% | 141.00% | |
Discout rate | 0.95% | 1.54% | |
Expected life | 10 years | 5 years 3 months | |
Total fair value | $ 3,853,000 | $ 236,000 |
Income Tax Provision (Details)
Income Tax Provision (Details) - USD ($) | 12 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | |
Federal | ||
Current | $ 0 | $ 0 |
Deferred | 0 | 0 |
State | ||
Current | 0 | 2,000 |
Deferred | 0 | 0 |
Income tax expense | $ 0 | $ 2,000 |
Income Tax Provision (Details 1
Income Tax Provision (Details 1) | 12 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | |
Income Tax Provision | ||
Federal statutory income tax rate | 21.00% | 21.00% |
State tax, net of federal benefit | 5.00% | 5.00% |
Change in valuation allowance on net operating loss carry-forwards | (26.00%) | (26.00%) |
Effective income tax rate | 0.00% | 0.00% |
Income Tax Provision (Details 2
Income Tax Provision (Details 2) - USD ($) | Sep. 30, 2021 | Dec. 31, 2020 | Dec. 31, 2019 |
Debt discount | $ 0 | $ (52,000) | $ 0 |
Income Tax Provision [Member] | |||
Stock-based compensation | 702,000 | 561,000 | |
Private placement costs | 366,000 | 320,000 | |
Operating lease liability | 42,000 | 54,000 | |
Loss on extinguishment of debt | 1,697,000 | 438,000 | |
Net operating loss carryforwards | 5,946,000 | 5,431,000 | |
Gross deferred tax assets | 8,753,000 | 6,804,000 | |
Less valuation allowance | (7,255,000) | (5,775,000) | |
Total deferred tax assets | 1,498,000 | 1,029,000 | |
Derivative gain | 1,455,000 | 865,000 | |
Debt discount | 2,000 | 110,000 | |
Operating lease right-of-use asset | 41,000 | 54,000 | |
Total deferred tax liabilities | 1,498,000 | 1,029,000 | |
Net deferred tax asset (liability) | $ 0 | $ 0 |
Income Tax Provision (Details N
Income Tax Provision (Details Narrative) - USD ($) | 12 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | |
Income tax valuation allowance | $ 1,480,000 | $ 795,000 |
Federal [Member] | ||
Net operating loss carry-forwards | $ 24,400,000 | 21,700,000 |
Carryforwards expiry year | 2040 | |
State [Member] | ||
Net operating loss carry-forwards | $ 12,500,000 | $ 9,800,000 |
Carryforwards expiry year | 2040 |
Commitments and Contingencies (
Commitments and Contingencies (Details Narrative) - USD ($) | 1 Months Ended | 3 Months Ended | 9 Months Ended | 12 Months Ended | |||
Aug. 24, 2015 | Sep. 30, 2021 | Sep. 30, 2020 | Sep. 30, 2021 | Sep. 30, 2020 | Dec. 31, 2020 | Dec. 31, 2019 | |
Revenue | $ 40,000 | $ 51,000 | $ 153,000 | $ 162,000 | $ 207,000 | $ 768,000 | |
Cyber Safety, Inc [Member] | |||||||
Patent expiry year | September 30, 2021 | ||||||
Option to buy patent price | $ 10,000,000 | ||||||
Revenue | $ 380 | $ 441,000 | |||||
Event of default, purchase price | $ 11,000,000 | ||||||
Event of default, maturity date | September 30, 2022 | ||||||
Cyber Safety, Inc [Member] | Minimum [Member] | |||||||
Amount receivable from product percentage | 15.00% | ||||||
Cyber Safety, Inc [Member] | Maximum [Member] | |||||||
Amount receivable from product percentage | 20.00% |
Subsequent Events (Details Narr
Subsequent Events (Details Narrative) - USD ($) | 9 Months Ended | 12 Months Ended | |
Sep. 30, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Common stock shares issued for services, shares | 24,155 | 128,527 | |
Accrued interest | $ 24,000 | ||
Common stock shares issued for services, amount | $ 2,000 | $ 26,000 | |
Common stock shares issued upon cancellation of accrued interest | 460,829 | ||
Financing obligation | $ 100,000 | ||
Common stock shares issued upon Cashless exercise, descriptions | the Company issued 34,139,772 shares of common stock upon a cashless exercise of 17,500,000 options shares and 17,045,454 warrants shares. | ||
Common stock shares issued during the period, shares | 38,116,450 | ||
Common stock shares issued during the period, amount | $ 1,525,000 | ||
Proceeds from funding amount received | 177,000 | ||
Convertible notes payable, outstanding balance | $ 1,438,000 | 1,469,000 | $ 1,860,000 |
Debt conversion converted/convertible amount, principal | $ 1,727,000 | ||
Option [Member] | |||
Granted options to purchase aggregate of common stock | 2,500,000 | ||
Common stock, shares issued upon cashless exercise of options | 13,557,693 | ||
Option, exercises during period | 15,000,000 | ||
Granted options to purchase aggregate of common stock price per share | $ 0.005 | ||
Granted options to purchase aggregate of common stock vesting period | 6 months | ||
Granted options to purchase aggregate of common stock expiration period | 10 years | ||
Convertible Promissory Note [Member] | |||
Debt conversion converted instrument, shares issued | 16,168,589 | ||
Convertible notes payable, outstanding balance | $ 45,000 | ||
Debt conversion converted/convertible amount, principal | 6,000 | ||
Repayment of related party debt | $ 367,000 | ||
Convertible Promissory Note [Member] | Minimum [Member] | |||
Conversion price | $ 0.00156 | ||
Convertible Promissory Note [Member] | Maximum [Member] | |||
Conversion price | $ 0.02 |