Document and Entity Information
Document and Entity Information - shares | 9 Months Ended | |
Sep. 30, 2018 | Dec. 19, 2018 | |
Document and Entity Information [Abstract] | ||
Entity Registrant Name | Cuentas Inc. | |
Entity Central Index Key | 1,424,657 | |
Document Type | 10-Q/A | |
Trading Symbol | CUEN | |
Amendment Flag | true | |
Amendment Description | Cuentas Inc. (the "Company") is filing this Amendment No. 1 on Form 10-Q/A (the "Amendment No. 1") to its Quarterly Report on Form 10-Q for the period ended September 30, 2018, filed with the Securities and Exchange Commission on December 19, 2018 (the "Form 10-Q"), to correct an error on the face of the Form 10-Q to reflect that the Company has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months prior to the filing date. In connection with the foregoing, and pursuant to the rules of the SEC, we are including with this Amendment No. 1 new certifications by our principal executive officer and principal financial officer. Accordingly, Part II, Item 6 of the Form 10-Q is being amended to reflect the filing of a new Exhibits 31.1, 31.2, 32.1 and 32.2. Other than with respect to the foregoing, this Amendment No. 1 does not modify or update in any way the disclosures made in the Form 10-Q. This Amendment No. 1 speaks as of the original filing date of the Form 10-Q and does not reflect events that may have occurred subsequent to such original filing date. | |
Document Period End Date | Sep. 30, 2018 | |
Current Fiscal Year End Date | --12-31 | |
Document Fiscal Period Focus | Q3 | |
Document Fiscal Year Focus | 2,018 | |
Entity Filer Category | Non-accelerated Filer | |
Entity Small Business | true | |
Entity Emerging Growth Company | false | |
Entity Ex Transition Period | false | |
Entity Common Stock, Shares Outstanding | 1,454,615 |
Condensed Consolidated Balance
Condensed Consolidated Balance Sheets - USD ($) $ in Thousands | Sep. 30, 2018 | Dec. 31, 2017 |
CURRENT ASSETS: | ||
Cash and cash equivalents | $ 48 | $ 93 |
Trade account receivables | 4,366 | 7,632 |
Other current assets | 128 | 210 |
Total current assets | 4,542 | 7,935 |
Property and Equipment | 15 | 6 |
Intangible assets | 2,614 | 2,970 |
Investments | 81 | 250 |
Goodwill | 1,334 | 1,334 |
Total assets | 8,586 | 12,495 |
CURRENT LIABILITIES: | ||
Accounts payable | 3,483 | 5,568 |
Other accounts liabilities | 1,491 | 1,962 |
Dividends payable | 30 | 30 |
Deferred revenue | 561 | 686 |
Notes and Loan payable | 100 | 146 |
Convertible notes payable, net of discounts and debt issue costs | 49 | |
Derivative liability | 212 | |
Related parties payables | 5,733 | 3,033 |
Stock based liabilities | 1,059 | 2,963 |
Total current liabilities | 12,457 | 14,649 |
Related party payables - Long term | 2,536 | |
Derivative liabilities - long term | 64 | 362 |
Other long-term liabilities | 97 | 120 |
TOTAL LIABILITIES | 12,618 | 17,667 |
STOCKHOLDERS’ DEFICIENCY | ||
Common stock subscribed | 140 | 400 |
Common stock, authorized 360,000,000 shares, $0.001 par value; 1,269,446 and 1,140,398 issued and outstanding as of September 30, 2018 and December 31, 2017, respectively | 1 | 1 |
Additional paid in capital | 10,885 | 9,555 |
Accumulated deficit | (14,419) | (14,208) |
Accumulated other comprehensive income | (300) | |
Total Cuestas Inc. stockholders' deficit | (3,383) | (4,542) |
Non-controlling interest in subsidiaries | (649) | (630) |
Total stockholders' deficit | (4,032) | (5,172) |
Total liabilities and stockholders' deficit | 8,586 | 12,495 |
Series B preferred stock | ||
STOCKHOLDERS’ DEFICIENCY | ||
Series B preferred stock, $0.001 par value, designated 10,000,000; 10,000,000 issued and outstanding as of September 30, 2018 and December 31, 2017, respectively | $ 10 | $ 10 |
Condensed Consolidated Balanc_2
Condensed Consolidated Balance Sheets (Parenthetical) - $ / shares | Sep. 30, 2018 | Dec. 31, 2017 |
Common stock, shares authorized | 360,000,000 | 360,000,000 |
Common stock, par value | $ 0.001 | $ 0.001 |
Common stock, shares issued | 1,269,446 | 1,140,398 |
Common stock, shares outstanding | 1,269,446 | 1,140,398 |
Series B preferred stock | ||
Preferred stock, par value | $ 0.001 | $ 0.001 |
Preferred stock, shares designated | 10,000,000 | 10,000,000 |
Preferred stock, shares issued | 10,000,000 | 10,000,000 |
Preferred stock, shares outstanding | 10,000,000 | 10,000,000 |
Condensed Consolidated Statemen
Condensed Consolidated Statements of Operations and Comprehensive Income (Loss) (Unaudited) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||||
Sep. 30, 2018 | Sep. 30, 2017 | Sep. 30, 2018 | Sep. 30, 2017 | |||
Consolidated Statements of Comprehensive Income (Loss) [Abstract] | ||||||
REVENUE | $ 20,563 | $ 625 | $ 61,472 | $ 1,700 | ||
COST OF REVENUE | 20,458 | 503 | 60,372 | 1,289 | ||
GROSS PROFIT | 105 | 122 | 1,100 | 411 | ||
OPERATING EXPENSES | ||||||
General and administrative | 1,119 | 522 | 2,817 | 2,249 | ||
TOTAL OPERATING EXPENSES | 1,119 | 522 | 2,817 | 2,249 | ||
OPERATING LOSS | (1,014) | (400) | (1,717) | (1,838) | ||
OTHER INCOME (EXPENSE) | ||||||
Other income | 197 | 550 | 197 | 730 | ||
Other expense | (184) | (279) | ||||
Interest expense | (156) | (150) | (904) | (748) | ||
Gain (loss) on derivative liability | 56 | 1,687 | 483 | (306) | ||
Gain from Change in extinguishment of debt | 99 | |||||
Gain from Change in fair value of stock-based liabilities | 632 | 2,191 | ||||
TOTAL OTHER INCOME (EXPENSE) | 545 | 2,087 | 1,787 | (324) | ||
Loss from discontinued operations | (328) | |||||
NET INCOME (LOSS) BEFORE CONTROLLING INTEREST | (469) | 1,687 | 70 | (2,490) | ||
NET INCOME ATTRIBUTILE TO NON-CONTROLLING INTEREST | 3 | 2 | 19 | 12 | ||
NET LOSS ATTRIBUTILE TO NET INCOME (LOSS) ATTRIBUTILE TO CUENTAS INC. | $ (466) | $ 1,689 | $ 89 | $ (2,478) | ||
Net income (loss) per basic share | $ (0.39) | $ 1.78 | [1] | $ 0.06 | $ (2.75) | [1] |
Net income (loss) per diluted share | $ (0.39) | $ 1.42 | [1] | $ (1.50) | $ (2.75) | [1] |
Weighted average number of basic common shares outstanding | 1,201,083 | 948,341 | [1] | 1,188,418 | 906,151 | [1] |
Weighted average number of diluted common shares outstanding | 1,201,083 | 1,191,609 | [1] | 1,301,258 | 906,151 | [1] |
[1] | Retrospectively adjusted to reflect the 300-for-1 reverse stock split. |
Condensed Consolidated Statem_2
Condensed Consolidated Statements of Cash Flows (Unaudited) - USD ($) $ in Thousands | 9 Months Ended | |
Sep. 30, 2018 | Sep. 30, 2017 | |
Cash Flows from Operating Activities: | ||
Net loss before non-controlling interest | $ 70 | $ (2,490) |
Adjustments to reconcile net income (loss) to net cash used in operating activities: | ||
Stock based compensation and shares issued for services | 617 | 1,098 |
Imputed interest | 179 | 179 |
Gain on extinguishment of debt | (99) | |
Debt discount amortization | 72 | 352 |
Gain on derivative fair value adjustment | (483) | 306 |
Loss on settlements | 84 | |
Amortization of debt issue costs | 13 | |
Loss on disposal of business | 328 | |
Available for sale securities received as other income | 169 | (550) |
Gain from Change in on fair value of stock-based liabilities | (2,191) | |
Write off of finance deposit | 25 | |
Depreciation and amortization expense | 37 | 63 |
Amortization of intangible assets | 321 | |
Changes in Operating Assets and Liabilities: | ||
Accounts receivable | 3,266 | (199) |
Other receivable | 141 | 40 |
Short term loan from 3rd parties | ||
Accounts payable | (2,174) | 459 |
Other Accounts payable | (92) | |
Deferred revenue | (125) | (8) |
Net Cash Used by Operating Activities | (208) | (384) |
Cash Flows from Investing Activities: | ||
Purchase of equipment | (11) | |
Net Cash Provided by Investing Activities | (11) | |
Cash Flows from Financing Activities: | ||
Proceeds from (repayments of) loans payable | (46) | 116 |
Repayments of convertible notes | (12) | |
Proceeds from related party loans | 92 | 170 |
Repayments of related party loans | (101) | |
Proceeds from common stock subscriptions | 140 | |
Net Cash Provided by Financing Activities | 174 | 185 |
Net Increase (Decrease) in Cash | (45) | (199) |
Cash at Beginning of Period | 93 | 256 |
Cash at End of Period | 48 | 57 |
Supplemental disclosure of cash flow information | ||
Cash paid for interest | 28 | |
Supplemental disclosure of non-cash financing activities | ||
Common stock issued as related party loan and accrued interest repayment | 295 | |
Common stock issued for conversion of convertible note principal | 27 | 345 |
Common stock issued for conversion of convertible accrued interest | 19 | |
Change in derivative liability written off to additional paid in capital due to conversion of convertible notes payable | 558 | |
Initial measurement of derivative liabilities recorded as debt discount | 185 | |
Common stock issued for settlement of stock-based liabilities | 490 | |
Common stock issued for settlement of common stock subscribed | $ 400 |
General
General | 9 Months Ended |
Sep. 30, 2018 | |
General [Abstract] | |
GENERAL | NOTE 1 – GENERAL Organizational Background: Cuentas, Inc. (formerly Next Group Holdings, Inc., the “Company”) was incorporated under the laws of the State of Florida on September 21, 2005 to act as a holding company for its subsidiaries, both current and future. Its subsidiaries are Meimoun and Mammon, LLC (100% owned), Next Cala, Inc (94% owned), NxtGn, Inc. (65% owned), Next Mobile 360, Inc. (100% owned) and SDI Next Distribution, LLC (51% owned). Additionally, Next Cala, Inc. has a 60% interest in NextGlocal, a subsidiary incorporated in May 2016. During the year ended December 31, 2016, the Company acquired a business segment, Tel3, from an existing corporation. Tel3 was merged into Meimoun and Mammon, LLC effective as of January 1, 2017. On October 23, 2017, the Company acquired 100% of the outstanding interests in Limecom, Inc. In September 2018, the Company changed its name to Cuentas, Inc. to better position its intended business activities. The Company invests in financial technology and currently derives its revenues from the sales of prepaid and wholesale calling minutes. Additionally, the Company has an agreement with Incomm, a leading processor of general purpose reloadable (“GPR”) debit cards, to market and distribute a line of GPR cards targeted towards the Latin American market. The Company intends to launch the cards upon successful completion of appropriate financing and has yet to generate revenues from this activity. The Company through it fully owned subsidiary, Meimoun and Mammon, LLC (“M&M”), provides telecom services to the retail and wholesale markets including sales of prepaid long-distance telecom services and Mobile Virtual Network Operator (MVNO) services. The services are sold under the brand name Next Mobile 360. Next Cala, Inc, (“Cala”) offers prepaid and reloadable debit cards to the retail market. Cala serves consumers in the underbanked and unbanked populations through Incomm, a leading provider of payment remittance services worldwide. NxtGn, Inc. (“NxtGn”) develops a High Definition telepresence product (“AVYDA”) which allows users to connect with celebrities, public figures, healthcare and education applications via a mobile phone, tablet or personal computer. NxtGn has entered into a joint venture with telephony platform industry leader Telarix, Inc. to develop and market the AVYDA Powered by Telarix™ HD telepresence platform. The AVYDA Powered by Telarix™ product is marketed throughout the world by the Telarix sales force. Since September 17, 2016 the Company has a Market Partner Agreement with InsightPOS, LLC. InsightPOS is a “State of the Art”, “Super Functional Point of Sale” system that has a combination of tools that we believe makes the retail experience quicker and better both for the shopper and for store management. The Company previously installed about 10 units including training by InsightPOS. These units were withdrawn due to required programming development and improved network interconnections. On October 23, 2017, the Company closed the acquisition of Limecom, Inc. (“Limecom”). Limecom is a global telecommunication company, providing services to telecommunication providers from all over the world. Limecom operates a network built on internet protocol (“IP”) switching equipment. On December 6, 2017, the Company completed its formation of SDI NEXT Distribution LLC in which it holds a 51% interest, previously announced August 24, 2017 as a Letter of Intent with Fisk Holdings, LLC. As Managing Member of the newly formed LLC, the Company will contribute a total of $500, to be paid per an agreed-upon schedule over a twelve-month period beginning December 2017. Fisk Holdings, LLC will contribute 30,000 active Point of Sale locations for distribution of retail telecommunications and prepaid financial products and services to include, but not be limited to: prepaid general-purpose reloadable cards, prepaid gift cards, prepaid money transfer, prepaid utility payments, and other prepaid products. There has been no activity in or cash contributions to this entity since formation. The Company, through its affiliate, Next Communications, Inc., has the right to sell STI Mobile, Next Cala and any Next products to 8,800 locations that were serviced by a prepaid distribution network. The Company will offer the InsightPOS system to clients of this distribution network as well via direct sales through its own sales force and affiliates. When a system is installed, the Company receives 50% of the gross profits received by InsightPOS after retailer commissions are paid. GOING CONCERN The accompanying financial statements have been prepared assuming that the Company will continue as a going concern. As of September 30, 2018, the Company had approximately $48 in cash and cash equivalents, approximately $7,915 in negative working capital, a stockholders’ deficiency of approximately $4,032 and an accumulated deficit of approximately $14,419. These conditions raise substantial doubt about the Company’s ability to continue as a going concern. Company’s ability to continue as a going concern is dependent upon raising capital from financing transactions and revenue from operations. Management anticipates their business will require substantial additional investments that have not yet been secured. Management is continuing in the process of fund raising in the private equity and capital markets as the Company will need to finance future activities. These financial statements do not include any adjustments that may be necessary should the Company be unable to continue as a going concern. REVERSE SPLIT The Company completed a reverse stock split of its common stock, by filing articles of amendment to its Articles of Incorporation (the “Articles of Amendment”) with the Secretary of State of Florida to effect the Reverse Stock Split on August 8, 2018. As a result of the reverse stock split, the following changes have occurred (i) every three hundred shares of common stock have been combined into one share of common stock; (ii) the number of shares of common stock underlying each common stock option, common stock warrant or any other convertible instrument of the Company have been proportionately decreased on a 300-for-1 basis, and the exercise price of each such outstanding stock option, common warrant or any other convertible instrument of the Company have been proportionately increased on a 300-for-1 basis. Accordingly, all option numbers, share numbers, warrant numbers, share prices, warrant prices, exercise prices and losses per share have been adjusted within these consolidated financial statements, on a retroactive basis, to reflect this 300-for-1 reverse stock split. No fractional shares were issued as a result of the reverse stock split. In lieu of issuing fractional shares, each holder of common stock who would otherwise have been entitled to a fraction of a share was entitled to receive one full share for the fraction of a share to which he or she was entitled. |
Summary of Significant Accounti
Summary of Significant Accounting Policies and Basis of Presentation | 9 Months Ended |
Sep. 30, 2018 | |
Summary of Significant Accounting Policies and Basis of Presentation [Abstract] | |
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES AND BASIS OF PRESENTATION | NOTE 2 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES AND BASIS OF PRESENTATION Unaudited Interim Financial Statements The accompanying unaudited consolidated financial statements include the accounts of the Company and its subsidiaries, prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”) and with the instructions to Form 10-Q and Article 10 of U.S. Securities and Exchange Commission Regulation S-X. Accordingly, they do not include all the information and footnotes required by generally accepted accounting principles for complete financial statements. In the opinion of management, the financial statements presented herein have not been audited by an independent registered public accounting firm but include all material adjustments (consisting of normal recurring adjustments) which are, in the opinion of management, necessary for a fair statement of the financial condition, results of operations and cash flows for the for the nine- months and three-months ended September 30, 2018. However, these results are not necessarily indicative of results for any other interim period or for the year ended December 31, 2018. The preparation of financial statements in conformity with GAAP requires the Company to make certain estimates and assumptions for the reporting periods covered by the financial statements. These estimates and assumptions affect the reported amounts of assets, liabilities, revenues and expenses. Actual amounts could differ from these estimates. Certain information and footnote disclosures normally included in financial statements in accordance with generally accepted accounting principles have been omitted pursuant to the rules of the U.S. Securities and Exchange Commission (“SEC”). The accompanying unaudited consolidated financial statements should be read in conjunction with the consolidated financial statements and notes thereto included in our Annual Report on Form 10-K for the fiscal year ended December 31, 2017, filed with the SEC on June 4, 2018 (the “Annual Report”). For further information, reference is made to the consolidated financial statements and footnotes thereto included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2017. Principles of Consolidation The consolidated financial statements are prepared in accordance with US GAAP. The consolidated financial statements of the Company include the Company and its wholly-owned and majority-owned subsidiaries. All inter-company balances and transactions have been eliminated. Use of Estimates The preparation of unaudited condensed consolidated financial statements in conformity with accounting principles generally accepted in the United States requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, certain revenues and expenses, and disclosure of contingent assets and liabilities as of the date of the financial statements. Actual results could differ from those estimates. Estimates are used when accounting for allowances for bad debts, stock-based compensation, collectability of loans receivable, potential impairment losses of intangible assets and goodwill, and fair value calculations related to embedded derivative features of outstanding convertible notes payable and other financial instruments. Revenue recognition The Company follows ASC 606 of the FASB Accounting Standards Codification for revenue recognition. Adoption of ASC 606 did not have a significant impact on the Company’s financial statements. The Company recognizes revenue upon transfer of control of promised products or services to customers in an amount that reflects the consideration expected to be received in exchange for those products or services. Revenue is recognized net of allowances for returns and any taxes collected from customers, which are subsequently remitted to governmental authorities. The Company primarily generates revenues through the sale of prepaid calling minutes to consumers through its Tel3 division and the sale of wholesale telecom minutes through its Limecom subsidiary. While the Company collects payment for prepaid consumer minutes in advance, revenue is recognized upon delivery to and consumption of minutes by the consumer or upon the forfeiture of minutes with forfeitures occurring after 12 consecutive months of non-use. Consumer Prepaid Minutes Revenues The Company recognizes revenues from the sale of prepaid telecommunications minutes directly to consumers at the retail level. While the Company collects payment for prepaid consumer minutes in advance, revenue is recognized upon delivery to and consumption of minutes by the consumer or upon the forfeiture of minutes with forfeitures occurring after 12 consecutive months of non-use. Generally, consumers will prepay a fixed dollar amount then consume the prepayment upon making telephone calls on the Company’s telecommunications network. Revenues from direct to consumer retail sales were $266 and $469 and $1,118 and $1,463 during the three and nine months ended September 30, 2018 and 2017, respectively. Wholesale Telecommunications Revenues The Company recognizes revenues from the brokering of sales of minutes from one telecommunications carrier to another. The Company receives an order for a defined number of minutes to a defined geographic region at which point it sources those minutes and purchases them with an immediate resale to the customer. Revenues from wholesale telecommunications minutes were $20,297 and $0 and $60,352 and $0 during the three and nine months ended September 30, 2018 and 2017, respectively. Deferred Revenue Deferred revenue is comprised mainly of unearned revenue related to prepayments from retail consumers for telecommunications minutes. The following table represents the changes in deferred revenue for the nine months ended September 30, 2018: Deferred Revenue Balance at December 31, 2017 686 Deferred revenue 993 Recognition of deferred revenue (1,118 ) Balance at September 30, 2018 561 Revenue allocated to remaining performance obligations represent contracted revenue that has not yet been recognized (“contracted not recognized”). Contracted not recognized revenue was $561 as of September 30, 2018, of which the Company expects to recognize 100% of the revenue over the next 12 months. Assets Recognized from the Costs to Obtain a Contract with a Customer The Company has elected to immediately expense contract acquisition costs that would be amortized in one year or less. The Company recognizes an asset for the incremental costs of obtaining a contract with a customer if the benefit of those costs is expected to be longer than one year. There were no capitalized contract acquisition costs as of September 30, 2018. Goodwill and Intangible Assets Goodwill represents the excess cost over the fair value of the assets of an acquired business. Goodwill and intangible assets acquired in a business combination accounted for as a purchase and determined to have an indefinite useful life are not amortized but are tested for impairment at least annually. Intangible assets with estimable useful lives are amortized over their respective estimated useful lives to their estimated residual values and reviewed periodically for impairment. The Company evaluates the possible impairment of goodwill annually as part of its reporting process for the fourth quarter of each fiscal year. The Company determines the fair value of each subsidiary the goodwill relates to and compares the fair value to the carrying amount of the subsidiary. To the extent the carrying amount of the subsidiary exceeds the fair value of it, an impairment loss is recorded. Amortization of intangible assets for each of the next five years and thereafter is expected to be as follows: Year ended December 31, 2018 107 2019 429 2020 429 2021 429 2022 429 Thereafter 791 Total 2,614 Amortization expense was $107 and $356 and $0 and $0 for the three and nine months ended September 30, 2018 and 2017, respectively. Amortization expense for each period is included in cost of revenue. Derivative and Fair Value of Financial Instruments Fair value accounting requires bifurcation of embedded derivative instruments such as conversion features in convertible debt or equity instruments and measurement of their fair value for accounting purposes. In assessing the convertible debt instruments, management determines if the convertible debt host instrument is conventional convertible debt and further if there is a beneficial conversion feature requiring measurement. If the instrument is not considered conventional convertible debt under ASC 470, the Company will continue its evaluation process of these instruments as derivative financial instruments under ASC 815. Once determined, derivative liabilities are adjusted to reflect fair value at each reporting period end, with any increase or decrease in the fair value being recorded in results of operations as an adjustment to fair value of derivatives. Fair value of certain of the Company’s financial instruments including cash, accounts receivable, accounts payable, accrued expenses, notes payables, and other accrued liabilities approximate cost because of their short maturities. The Company measures and reports fair value in accordance with ASC 820, “Fair Value Measurements and Disclosure” defines fair value, establishes a framework for measuring fair value in accordance with generally accepted accounting principles and expands disclosures about fair value measurements. Fair value, as defined in ASC 820, is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. The fair value of an asset should reflect its highest and best use by market participants, principal (or most advantageous) markets, and an in-use or an in-exchange valuation premise. The fair value of a liability should reflect the risk of nonperformance, which includes, among other things, the Company’s credit risk. Valuation techniques are generally classified into three categories: the market approach; the income approach; and the cost approach. The selection and application of one or more of the techniques may require significant judgment and are primarily dependent upon the characteristics of the asset or liability, and the quality and availability of inputs. Valuation techniques used to measure fair value under ASC 820 must maximize the use of observable inputs and minimize the use of unobservable inputs. ASC 820 also provides fair value hierarchy for inputs and resulting measurement as follows: Level 1: Quoted prices (unadjusted) in active markets that are accessible at the measurement date for identical assets or liabilities. Level 2: Quoted prices for similar assets or liabilities in active markets; quoted prices for identical or similar assets or liabilities in markets that are not active; inputs other than quoted prices that are observable for the asset or liability; and inputs that are derived principally from or corroborated by observable market data for substantially the full term of the assets or liabilities; and Level 3: Unobservable inputs for the asset or liability that are supported by little or no market activity, and that are significant to the fair values. Fair value measurements are required to be disclosed by the Level within the fair value hierarchy in which the fair value measurements in their entirety fall. Fair value measurements using significant unobservable inputs (in Level 3 measurements) are subject to expanded disclosure requirements including a reconciliation of the beginning and ending balances, separately presenting changes during the period attributable to the following: (i) total gains or losses for the period (realized and unrealized), segregating those gains or losses included in earnings, and a description of where those gains or losses included in earning are reported in the statement of income. The Company’s financial assets and liabilities that are measured at fair value on a recurring basis by level within the fair value hierarchy are as follows: Balance as of September 30, 2018 Level 1 Level 2 Level 3 Total Liabilities: Stock based liabilities 1,059 — — 1,059 Short term derivative value — — — — Long term derivative value 64 — — 64 Total liabilities 1,123 — — 1,123 Balance as of December 31, 2017 Level 1 Level 2 Level 3 Total Liabilities: Stock based liabilities 2,963 — — 2,963 Short term derivative value 212 — — 212 Long term derivative value 362 — — 362 Total liabilities 3,537 — — 3,537 Basic Income (Loss) Per Share Basic income (loss) per share is calculated by dividing the Company’s net loss applicable to common shareholders by the weighted average number of common shares during the period. Diluted earnings per share is calculated by dividing the Company’s net income available to common shareholders by the diluted weighted average number of shares outstanding during the year. The diluted weighted average number of shares outstanding is the basic weighted average number of shares adjusted for any potentially dilutive debt or equity. At September 30, 2018, the Company had one outstanding convertible note payable with conversion rights that are exercisable. The amount of outstanding principal on this convertible note is $0 plus accrued interest of $5 for total convertible debt as of September 30, 2018 of $5 representing 2,506 new dilutive common shares if converted at the applicable rates. Additionally, the Company has committed to issue a total of 179,851 shares of common stock for the settlement of a related party note payable and services which are not yet issued or outstanding. The effects of this note and total common shares committed to be issued have been excluded from net income per diluted share for the three and nine months ended September 30, 2018. At September 30, 2017, the Company had eighteen outstanding convertible notes payable with conversion rights that are exercisable. The amount of outstanding principal on these convertible notes total $985 plus accrued interest of $388 for total convertible debts as of September 30, 2017 of $1,328 representing 243,268 new dilutive common shares if converted at the applicable rates. The effects of these notes have been included in net income per diluted share for the three months ended September 30, 2017 and excluded from the nine months ended September 30, 2017. The Net income (loss) attributable to common shareholders for the period ended September 30, 2018 is as the follow: Net income (loss) before controlling interest 70 Reallocation of stock-based compensation 164 Reallocation of Gain from Change in fair value of stock-based liabilities (2,191 ) Net income (loss) attributable to common shareholders (1,957 ) For the nine months ended September 30, 2018, potentially dilutive securities consisted of 179,851 shares which the Company is obligated to issue and 162,044 options to purchase of common stock at prices ranging from $3 to $54 per share. Of these potentially dilutive securities, only 179,851 shares which the Company is obligated to issue and 90,000 options to purchase of common stock at price of $3 per share are included in the computation of diluted earnings per share because the effect of including the remaining instruments would be anti-dilutive. Reclassified Amounts Certain prior year amounts have been reclassified for consistency with the current year presentation. These reclassifications did not have material effect on the reported results of operations, shareholder’s deficit or cash flows. Recent Accounting Standards announced In August 2018, the FASB issued ASU 2018-13, Fair Value Measurement (Topic 820): Disclosure Framework – Changes to the Disclosure Requirements for Fair Value Measurement. The amendments apply to reporting entities that are required to make disclosures about recurring or nonrecurring fair value measurements and should improve the cost, benefit, and effectiveness of the disclosures. ASU 2018-13 categorized the changes into those disclosures that were removed, those that were modified, and those that were added. The primary disclosures that were removed related to transfers between Level 1 and Level 2 investments, along with the policy for timing of transfers between levels. In addition, disclosing the valuation processes for Level 3 fair value measurements was removed. The amendments are effective for all organizations for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2019. Early adoption is permitted. The Company notes that this guidance will impact its disclosures beginning January 1, 2020. Recently adopted accounting pronouncements In January 2016, the FASB issued Accounting Standards Update No. 2016-01 (ASU 2016-01) “Financial Instruments-Overall (Subtopic 825-10): Recognition and Measurement of Financial Assets and Financial Liabilities,” which amends various aspects of the recognition, measurement, presentation, and disclosure of financial instruments. We adopted ASU 2016-01 as of January 1, 2018 which resulted in a $300 reclassification of net unrealized gains from accumulated other comprehensive income to the retained earnings. The adoption of ASU 2016-01 increases the volatility of our other income (expense), net, as a result of the remeasurement of our equity securities. |
Notes Payable and Convertible N
Notes Payable and Convertible Notes Payable | 9 Months Ended |
Sep. 30, 2018 | |
Notes Payable and Convertible Notes Payable [Abstract] | |
NOTES PAYABLE AND CONVERTIBLE NOTES PAYABLE | NOTE 3 – NOTES PAYABLE AND CONVERTIBLE NOTES PAYABLE Notes Payable During the year ended December 31, 2017, the Company entered into two separate loans to be paid by collection of its future accounts receivable and secured by substantially all assets of the Company including accounts receivable, cash, equipment, intangible assets, inventory and other receivables. The first loan resulted in cash proceeds of $125 to the Company for future payments totaling $169 from future receivables and requires daily repayments of $1. The second resulted in cash proceeds of $50 for future payments totaling $68 from future receivables and requires daily cash repayments of $10. There was $0 and $46 due for the agreements as of September 30, 2018 and December 31, 2017, respectively, included in current notes payable. On May 1, 2017, the Company received a loan from an unrelated party for $25. The loan is due on demand and as such is included in current notes payable. The note does not accrue interest and had a principal balance due of $25 as of September 30, 2018 and December 31, 2017, respectively. On April 25, 2018, the Company entered into a loan agreement to be paid by collection of its future accounts receivable and secured by substantially all assets of the Company including accounts receivable, cash, equipment, intangible assets, inventory and other receivables. The loan resulted in cash proceeds to the Company of $180 for future payments totaling $234 from future receivables and requires daily repayments of $2. There was $0 and $0 due as of September 30, 2018 and December 31, 2017, respectively, included in current notes payable. Convertible Notes Payable The Company has entered into a series of convertible notes payable to fund operations. While with differing noteholders, the terms of the outstanding convertible notes are substantially similar and accrue interest at 8% annually with a default interest rate of 24% and allow for the conversion of outstanding principal and interest to common stock at a price equal to 45% to 50% from the lowest trading price in the preceding 20 days. The Company settled the majority of its convertible notes payable in December 2017 for a combination of cash and shares of common stock. An additional convertible note payable was settled in January 2018 for a combination of cash and shares of common stock. The following table summarizes all convertible notes payable activity for the nine months ended September 30, 2018: Holder Issue Date Due Date Original Principal Balance, December 31, Repayments Conversions to Common Stock Forgiveness of Principal Balance, September 30, Noteholder 5 11/9/2015 11/9/201 100 49 (12 ) (27 ) (10 ) - Totals 100 49 (12 ) (27 ) (10 ) - The following is a summary of all convertible notes outstanding as of September 30, 2018: Holder Issue Date Due Date Principal Discount Unamortized Debt Issue Costs Carrying Value Accrued Interest Noteholder 6 11/2/2016 11/2/2017 - - - - 5 Totals - - - - 5 |
Derivative Liabilities
Derivative Liabilities | 9 Months Ended |
Sep. 30, 2018 | |
Derivative Liabilities [Abstract] | |
DERIVATIVE LIABILITIES | NOTE 4 – DERIVATIVE LIABILITIES The Company analyzed the conversion features of the convertible notes payable as discussed in Note 3 – Notes Payable and Convertible Notes Payable As of September 30, 2018, the Company had a $64 derivative liability on the balance sheet and recorded gains from derivative liability fair value adjustments of $27 and $483 during the three and nine months ended September 30, 2018. The derivative liability activity comes from convertible notes payable as discussed in Note 3 Notes Payable and Convertible Notes Payable Note 9 – Stockholders’ Equity A summary of the changes in derivative liabilities balance for the nine months ended September 30, 2018 is as follows: Fair Value of Embedded Derivative Liabilities Balance, December 31, 2017 574 Change in fair value (483 ) Change due to conversion (27 ) Balance, September 30, 2018 64 The value of the embedded derivative liabilities for the convertible notes payable and outstanding option awards was determined using the Black-Scholes option pricing model based on the following assumptions: September 30, December 31, Common stock price 5.00 17.40 Expected volatility 211 % 178% - 334 % Expected term 1.51 years .01 - 2.25 years Risk free rate 2.81 % 0.97% - 1.89 % Forfeiture rate 0 % 0 % Expected dividend yield 0 % 0 % |
Stock Options
Stock Options | 9 Months Ended |
Sep. 30, 2018 | |
Stock Options [Abstract] | |
STOCK OPTIONS | NOTE 5 – STOCK OPTIONS The following table summarizes all stock option activity for the nine months ended September 30, 2018: Shares Weighted- Outstanding, December 31, 2017 105,378 $ 39.27 Granted 90,000 3.00 Forfeited (33,334 ) 54.00 Outstanding, September 30, 2018 162,044 $ 16.09 The following table discloses information regarding outstanding and exercisable options at September 30, 2018: Outstanding Exercisable Exercise Number of Weighted Average Weighted Average Number of Weighted Average $ 54.00 25,000 $ 54.00 1.5 25,000 $ 54.00 21.00 47,044 21.00 1.74 47,044 21.00 3.00 90,000 3.00 4.96 30,000 3.00 162,044 $ 16.09 2.98 102,044 $ 23.79 On September 13, 2018, the Company issued 60,000 options to its President and Chief Executive Office. The options carry an exercise price of $3 per share. A third of the options vested immediately with the remaining vesting over the course of two years. The Options are exercisable until September 12, 2023. The Company has estimated the fair value of such options at a value of $302 at the date of issuance using the Black-Scholes option pricing model using the following assumptions: Common stock price 5.05 Dividend yield 0 % Risk-free interest rate 2.87 % Expected term (years) 5 Expected volatility 374.26 % On September 13, 2018, the Company issued 30,000 options to its member of the Board. The options carry an exercise price of $3 per share. Third of the options vested immediately with the remaining vesting over the course of two years. The Options are exercisable until September 12, 2023. The Company has estimated the fair value of such options at a value of $151 at the date of issuance using the Black-Scholes option pricing model using the following assumptions: Common stock price 5.05 Dividend yield 0 % Risk-free interest rate 2.87 % Expected term (years) 5 Expected volatility 374.26 % During the nine months ended September 30, 2018, the Company recorded an option-based compensation expense of $164 associated with these grants. |
Stockholders' Equity
Stockholders' Equity | 9 Months Ended |
Sep. 30, 2018 | |
Stockholders' Equity [Abstract] | |
STOCKHOLDERS' EQUITY | NOTE 6 – STOCKHOLDERS’ EQUITY Common Stock The following summarizes the common stock activity for the nine months ended September 30, 2018: Summary of common stock activity for the nine months ended September 30, 2018 Outstanding shares Balance, December 31, 2017 1,140,398 Shares issued for common stock subscriptions 38,096 Shares issued as settlement of stock-based liabilities 72,485 Shares issued for services 13,333 Shares issued for rounding from 1:300 reverse stock split 967 Shares issued for settlement of convertible notes payable and accrued interest 4,167 Balance, September 30, 2018 1,269,446 On January 9, 2018, the Company issued 11,483 shares of its common stock pursuant to a settlement of stock-based liabilities. The fair market value of the shares was $155. On January 12, 2018, the Company issued 2,000 shares of its common stock to a note holder in connection with outstanding convertible note payable and convertible accrued interest on convertible notes payable in accordance with a settlement agreement. The fair market value of the shares was $27. On February 7, 2018, the Company issued 38,096 shares of its common stock pursuant to a common stock subscription. The fair market value of the shares at the subscription date was $400. On September 11, 2018, the Company issued 2,167 shares of its common stock to a note holder in connection with outstanding convertible note payable and convertible accrued interest on convertible notes payable in accordance with a settlement agreement. The fair market value of the shares was $11. On September 27, 2018, the Company issued 13,333 shares of its common stock to a consultant, pursuant to a consulting agreement dated September 18, 2018, in consideration for consulting services. The fair market value of the shares at grant date was $60. On September 27, 2018, the Company issued 61,002 shares of its common stock pursuant to a settlement of stock-based liabilities. The fair market value of the shares was $335. On September 21 st |
Related Party Transactions
Related Party Transactions | 9 Months Ended |
Sep. 30, 2018 | |
Related Party Transactions [Abstract] | |
RELATED PARTY TRANSACTIONS | NOTE 7 – RELATED PARTY TRANSACTIONS The Company has had extensive dealings with related parties including those in which our Chief Executive Officer holds a significant ownership interest as well as an executive position during the nine months ended September 30, 2018 and year ended December 31, 2017. Due to our operational losses, the Company has relied to a large extent on funding received from Next Communications, Inc., an organization in which the Company’s Chief Executive Officer holds a controlling equity interest and an executive position. During the first calendar quarter of 2017, Next Communications, Inc. filed for bankruptcy protection. As a result, the related party payable is being handled by a court appointed trustee as an asset of Next Communications, Inc. and the Company may be compelled to repay the amounts due. With the exception of the Company’s purchase of a 9% interest in Next Cala, Inc. from a related party and the related party payable to Orlando Taddeo for the acquisition of Limecom as described below, amounts scheduled below as “due to related parties” and “due from related parties” have not had their terms, including amounts, collection or repayment terms or similar provisions memorialized in formalized written agreements. Related party balances at September 30, 2018 and December 31, 2017 consisted of the following: Due from related parties September 30, December 31, (a) Glocal Card Services 36 36 Total Due from related parties 36 36 Related party payables, net of discounts September 30, (unaudited) December 31, (b) Due to Next Communications, Inc. (current) 2,972 2,920 (c) Due to Asiya Communications SAPI de C.V. (current) 36 6 (d) Michael DePrado (current) 100 100 (e) Orlando Taddeo, net of discount of $0 and $72 (due July 21, 2019) 2,613 2,536 (f) Next Cala 360 (current) 12 7 Total related party payables 5,733 5,569 (a) Glocal Card Services is our partner in the Glocal Joint Venture (b) Next Communication, Inc. is a corporation in which our Chief Executive Officer holds a controlling interest and serves as the Chief Executive Officer. The balance with Next Communication, Inc. accrues an annual interest of 8%. (c) Asiya Communications SAPI de C.V.is a telecommunications company organized under the laws of Mexico, in which our Chief Executive Officer holds a substantial interest and is involved in active management. (d) Michael DePrado is the Company’s Chief Operating Officer (e) Amount due to Orlando Taddeo from the acquisition of Limecom (f) Next Cala 360, is a Florida corporation established and managed by our Chief Executive Officer. Accounts Receivable, Related Party The Company had outstanding accounts receivable of $78 from related parties as of September 30, 2018 of which $71 was due from Next Communications, $6 was due from Next Cala 360 and $14 was due from Asiya Communications SAPI de C.V. The accounts receivable was recorded as a result of the sale of wholesale telecommunications minutes to these entities. As of September 30, 2018 Limecom, had outstanding accounts receivable of $4,094 from Airtime Sp.z.o.o., which is a subsidiary of one the Company’s shareholders of the Company and a former owner of Limecom. The accounts receivable was recorded as a result of the sale of wholesale telecommunications minutes to this entity. Accounts Payable, Related Party The Company had outstanding accounts payable of $507 to related parties as of September 30, 2018 all of which was to Asiya Communications SAPI de C.V. Revenues (Related Party) The Company made sales to and generated revenues from related parties of $15,942 and $155 during the three months ended September 30, 2018 and 2017 as itemized below: For the Three Months Ended 2018 2017 Next Communications, Inc. 4,208 155 VTX Corporation (a) 1,587 Airtime Sp.z.o.o. 5,095 - Asiya Communications SAPI de C.V. 5,052 - Total 15,942 155 (a) A corporation that is owned by one of the Company’s shareholders and a former owner of Limecom The Company made sales to and generated revenues from related parties of $36,850 and $233 during the nine months ended September 30, 2018 and 2017 as itemized below: For the Nine Months Ended 2018 2017 Next Communications, Inc. 10,021 227 VTX Corporation 11,305 - Airtime Sp.z.o.o. 5,095 - Asiya Communications SAPI de C.V. 10,429 2 Next Cala 360 - 4 Total 36,850 233 Costs of Revenues (Related Party) The Company made purchases from related parties totaling $8,954and $0 during the three months ended September 30, 2018 and 2017 which are included in cost of revenues as itemized below: For the Three Months Ended 2018 2017 Next Communications, Inc. 4,736 - Asiya Communications SAPI de C.V. 4,218 - Total 8,954 - The Company made purchases from related parties totaling $20,389 and $0 during the nine months ended September 30, 2018 and 2017 which are included in cost of revenues as itemized below: For the Nine Months Ended 2018 2017 Next Communications, Inc. 9,438 - Asiya Communications SAPI de C.V. 10,951 - Total 20,389 - |
Customer Concentration
Customer Concentration | 9 Months Ended |
Sep. 30, 2018 | |
Customer Concentration [Abstract] | |
CUSTOMER CONCENTRATION | NOTE 8 – CUSTOMER CONCENTRATION The Company generated approximately 70% of its revenues for the three months ended September 30, 2018 and 52% of its revenues for the nine months ended September 30, 2018 from three related parties. The Company did not have any one customer account for more than 10% of its revenues during the three or nine months ended September 30, 2017. As of September 30, 2018, three separate customers accounted for approximately 98% of the Company’s total accounts receivable. As of December 31, 2017, three separate customers accounted for approximately 78% of the Company’s total accounts receivable. |
Restatement of the Three and Ni
Restatement of the Three and Nine Months Ended September 30, 2017 | 9 Months Ended |
Sep. 30, 2018 | |
Restatement Of The Three And Nine Months Ended September 30, 2017 [Abstract] | |
RESTATEMENT OF THE THREE AND NINE MONTHS ENDED SEPTEMBER 30, 2017 | NOTE 9 – RESTATEMENT OF THE THREE AND NINE MONTHS ENDED SEPTEMBER 30, 2017 The Company has restated its statement of operations and statement of cash flows for the nine months ended September 30, 2017 to correct an error in the treatment of the disposal of a subsidiary. The Company had originally recorded the elimination of the non-controlling interest component of equity of the sold subsidiary as an equity only transaction by absorbing $2,541 of non-controlling interest equity into that of the Company. The correct treatment of the disposal necessitates the amount of non-controlling interest to be included in the calculation of the gain or loss on the disposal of a subsidiary recognized through the income statement. The impact to the financial statements is an increase in loss from discontinued operations and net loss by $2,541 for the nine months ended September 30, 2017 and no change for the three months ended September 30, 2017. Net loss per common share increased from $0.00 as originally stated to $2.73 as restated for the nine months ended September 30, 2017 with no change for the three months ended September 30, 2017. There was no impact on the net cash used in operations during the nine months ended September 30, 2017 as a result of the restatement. Although not presented, the impact of the restatement on the Company’s consolidated balance sheet as of September 30, 2017 is an increase to additional paid in capital and increase to accumulated deficit of $ . |
Commitments and Contingencies
Commitments and Contingencies | 9 Months Ended |
Sep. 30, 2018 | |
Commitments and Contingencies [Abstract] | |
COMMITMENTS AND CONTINGENCIES | NOTE 10 – COMMITMENTS AND CONTINGENCIES If the assessment of a contingency indicates that it is probable that a material loss has been incurred and the amount of the liability can be estimated, then the estimated liability would be accrued in the Company’s consolidated financial statements. If the assessment indicates that a potential material loss contingency is not probable but is reasonably possible, or is probable but cannot be estimated, then the nature of the contingent liability, and an estimate of the range of possible losses, if determinable and material, would be disclosed. On April 7, 2016, the Company executed an agreement with a service provider to provide certain services for the Company. In addition to cash and stock compensation, the agreement requires 1% of the outstanding common share equivalent to be issued to the third party when the market capitalization of the Company reaches $500 and an additional 1% when it reaches $750. The Company recorded an expense associated with the non-variable portion of the agreement. However, the probability of the Company’s market capitalization reaching these thresholds is uncertain at present and the Company has not accrued a contingent fee as of September 30, 2018 or December 31, 2017 as a result. On October 14, 2014, one of our operating subsidiaries, NxtGn Inc., and Next Communications, Inc., an entity controlled by our CEO, (collectively the “Plaintiffs”) filed suit in the United States District Court for the Southern district of New York against Viber Media, Inc. (“Viber”). Plaintiffs filed an Amended Complaint asserting four claims: misappropriation of a business idea, misappropriation of trade secrets, breach of contract, and unjust enrichment. Viber moved the Court to dismiss the Amended Complaint. On March 30, 2016, U.S. District Judge Richard Sullivan issued an opinion and order on Viber’s motion to dismiss. Specifically, Judge Sullivan ordered that Viber’s motion to dismiss is granted on Plaintiffs’ misappropriation of a business idea claim, but denied as to their misappropriation of trade secrets, breach of contract, and unjust enrichment claims. The Company has not accrued any gains associated with this case as it would be a contingent gain and recorded when received. On February 12, 2018, the Company was served with a complaint from Viber Media, Inc. (“Viber”) for reimbursement of attorney’s fees and costs totaling $528 arising from a past litigation with Viber. The Company is vigorously defending their rights in this case as we believe this demand is premature as litigation is ongoing. The Company has not accrued an estimated loss related to this complaint as of September 30, 2018 or December 31, 2017 given the premature nature of the motion. On October 20, 2016, the Company received a notice it has been named as a defendant in a suit brought against Next Communications, an entity controlled by our CEO. In addition to being named a defendant, it was requested the Company provide certain documents for the discovery process. Due to the original suit being filed against a related party and not against the Company or its subsidiaries, we believe it likely the Company and its subsidiaries will be dismissed as defendants and has not accrued a contingent loss as of September 30, 2018 or December 31, 2017 as a result. On July 6, 2017, the Company received notice an existing legal claim against Accent InterMedia (“AIM”) had been amended to include claims against the Company. The claims brought against the Company include failure to comply with certain judgments for collection of funds by the plaintiff while having a controlling interest in AIM via its ownership of Transaction Processing Products (“TPP”). The Company believes the amended case is without merit and that, per its agreement to sell its interest in TPP, any claims brought against AIM or TPP would be the responsibilities of the current interest holders. Due to the original suit being filed against AIM and amended to include the Company after it disposed of its interest in TPP, which had a controlling interest in AIM, we believe it likely the Company and its subsidiaries will be dismissed as defendants. On December 20, 2017, a Complaint was filed by J. P. Carey Enterprises, Inc., alleging a claim for $473 related to the Franjose Yglesias-Bertheau filed lawsuit against PLKD listed above. Even though the Company made the agreed payment of $10 on January 2, 2017 and issued 12,002 shares as conversion of the $70 note as agreed in the settlement agreement, the Plaintiff alleges damages which the Company claims are without merit because they received full compensation as agreed. The Company is in the process of defending itself against these claims. The Company has not accrued losses related to this claim due to the early stages of litigation. During 2016, Limecom had disputed accounts payable with three (3) carriers, for which the Company entered into separate settlement agreements, totaling approximately $1,147. Under the terms of these settlement agreements, the Company was provided with extended payment terms on the outstanding balances. These settlement agreements are non-interest bearing and include certain default provisions as disclosed in the related agreements. On October 23, 2017, this liability was $676. Limecom repaid $10 from the date of acquisition through December 31, 2017 and $95 during the nine months ended September 30, 2018. The remaining outstanding principal balance of these settlement agreements amounted to approximately $571 and $666 as of September 30, 2018 and December 31, 2017, respectively. Of these totals, $571 and $546 is current and included in accrued liabilities and $0 and $120 is long term and represented by other long-term liabilities as of September 30, 2018 and December 31, 2017, respectively. Prior to October 23, 2017 (the date of Limecom acquisition), Limecom had entered into a settlement agreement with American Express . On August 9, 2018, Limecom was served with a complaint by Spectrum Intelligence Communications Agency LLC (SICA) whereby SICA claims that Limecom owes them a total of $439. Limecom is in the process of defending and potentially negotiating a settlement with SICA. On September 28, 2018, the Company was notified of a complaint filed against it by a former supplier. The Company has not yet received formal service of the complaint and is awaiting such service at which time it can fully assess the complaint. The Company has not accrued any losses as of September 30, 2018 related to the complaint given the early nature of the process. The Company executed a lease for office space effective July 10, 2018 with a term to October 31, 2018. The lease requires monthly rental payments of $5. Total future guaranteed payments under this lease are $5. |
Pro Forma Statements of Operati
Pro Forma Statements of Operations | 9 Months Ended |
Sep. 30, 2018 | |
Pro Forma Statements of Operations [Abstract] | |
PRO FORMA STATEMENTS OF OPERATIONS | NOTE 11 – PRO FORMA STATEMENTS OF OPERATIONS On October 23, 2017, the Company completed its acquisition of Limecom as discussed in Note 1 – Organization and Description of Business CUENTAS, INC. (FORMERLY NEXT GROUP HOLDINGS, INC.) COMBINED PRO FORMA STATEMENTS OF OPERATIONS NINE MONTHS ENDED SEPTEMBER 30, 2017 Cuentas Limecom Pro Forma Adjustments Pro Forma Revenue $ 1,700 $ 65,743 $ - $ 67,443 Cost of revenue 1,289 63,653 321 (a) 65,263 Gross margin 411 2,090 (321 ) 2,180 Operating expenses General and administrative 2,249 1,491 - 3,740 Total operating expenses 2,249 1,491 - 3,740 Income (loss) from operations (1,838 ) 599 (321 ) (1,560 ) Other income (expense) Other income 730 92 - 822 Interest expense (748 ) (242 ) - (990 ) Loss on derivative liability (306 ) - - (306 ) Total other income (expense) (324 ) (150 ) - (474 ) Net income (loss) from continuing operations $ (2,162 ) $ 449 $ (321 ) $ (2,034 ) (a) Amortization of acquired intangible assets from acquisition |
Subsequent Events
Subsequent Events | 9 Months Ended |
Sep. 30, 2018 | |
Subsequent Events [Abstract] | |
SUBSEQUENT EVENTS | NOTE 12 – SUBSEQUENT EVENTS On October 20, 2018, J. P. Carey Enterprises, Inc. voluntarily withdrew its claim against the Company. On October 25, 2018, the Company received $108 under a private placement of securities closed on October 25, 2018 and issued 35,834 shares of its common stock. The issuance cost was $8. October 25, 2018, the Company was notified by its registered agent in the state of Florida it had received notification of a filed complaint by a former employee that alleges breach of contract. The Company is in the early stages of discovery with a response to the complaint due on November 14, 2018. The Company has not accrued any losses as of September 30, 2018 related to the complaint given the early nature of the process. On November 6, 2018, the Company, through Limecom, the Company’s wholly owned subsidiary, finalized an accounts receivable factoring agreement whereby the factor agent will purchase outstanding accounts receivable at its sole discretion less certain commissions. The factoring agent commission due under the agreement is 1.19% of the face value of the purchased accounts receivable for the twenty days immediately following invoice issuance plus 0.59% for each twenty days thereafter. The factoring agent may advance cash to the Company at its sole discretion up to 90% of the purchase price with an initial maximum advance capacity of $4,000. The Company may request increases to the maximum advance allowed under the agreement not to exceed an additional $1,000 during each 90-day period immediately following execution for up to a maximum advance of $8,000. The Company agreed to pay ThinkEquity, a division of Fordham Financial Management Inc. (“Think”), a 2.5% fee on the initial $4 million factoring limit, equal to $100 in 4 installments for acting as a financial advisor to the Company with respect to the Agreement. Think will be paid additional fees of 3% of any increase in the facility size above the $4,000 facility up to the $8,000 total amount of the factoring facility. Think will also receive a warrant, valid for 5 years, entitling it to purchase a number of shares equal to 3.5% of the maximum facility size. The warrant shall have an exercise price equal to the five (5) day volume weighted average price of common shares on the date of closing, or if the Company is not publicly traded, equal to the per share price paid by investors in the Company’s most recent equity investment round prior to the execution of the Agreement. The shares underlying the warrant shall entitle the holder to one-time “piggyback” registration rights (unless Rule 144 is then available). The warrant may be exchanged without the payment of any additional consideration for the Company’s stock based upon the values of the warrant and the stock at the time of the exchange. On November 20, 2018 and November 28, 2018, the Company received $100 under a private placement of securities closed on December 13, 2018 and issued 36,667 shares of its common stock and warrants to purchase up to 36,667 shares of its common stock at an exercise price equal to $3.25 per share. The issuance cost was $10. On November 26, 2018, the Company received notice of a complaint through its registered agent regarding a Complaint by American Express claiming damages incurred by Limecom for the amount of $507. On December 18, 2018, Limecom had entered into a second Amendment of the Settlement Agreement with American Express. Under the second Amendment Limecom paid $25 on December 19, 2018 and the remaining balance in 13 installments through December 15, 2019. During December, 2018, the Company received $248 under a private placement of securities closed on December 13, 2018 and issued 82,667 shares of its common stock and warrants to purchase up to 82,667 shares of its common stock at an exercise price equal to $3.25 per share. On December 13, the Company issued 30,001 shares of its common stock for the consideration of $90 which it received of under the Securities Purchase Agreement which it entered on September 21 st |
Summary of Significant Accoun_2
Summary of Significant Accounting Policies and Basis of Presentation (Policies) | 9 Months Ended |
Sep. 30, 2018 | |
Summary of Significant Accounting Policies and Basis of Presentation [Abstract] | |
Principles of Consolidation | Principles of Consolidation The consolidated financial statements are prepared in accordance with US GAAP. The consolidated financial statements of the Company include the Company and its wholly-owned and majority-owned subsidiaries. All inter-company balances and transactions have been eliminated. |
Use of Estimates | Use of Estimates The preparation of unaudited condensed consolidated financial statements in conformity with accounting principles generally accepted in the United States requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, certain revenues and expenses, and disclosure of contingent assets and liabilities as of the date of the financial statements. Actual results could differ from those estimates. Estimates are used when accounting for allowances for bad debts, stock-based compensation, collectability of loans receivable, potential impairment losses of intangible assets and goodwill, and fair value calculations related to embedded derivative features of outstanding convertible notes payable and other financial instruments. |
Revenue recognition | Revenue recognition The Company follows ASC 606 of the FASB Accounting Standards Codification for revenue recognition. Adoption of ASC 606 did not have a significant impact on the Company’s financial statements. The Company recognizes revenue upon transfer of control of promised products or services to customers in an amount that reflects the consideration expected to be received in exchange for those products or services. Revenue is recognized net of allowances for returns and any taxes collected from customers, which are subsequently remitted to governmental authorities. The Company primarily generates revenues through the sale of prepaid calling minutes to consumers through its Tel3 division and the sale of wholesale telecom minutes through its Limecom subsidiary. While the Company collects payment for prepaid consumer minutes in advance, revenue is recognized upon delivery to and consumption of minutes by the consumer or upon the forfeiture of minutes with forfeitures occurring after 12 consecutive months of non-use. Consumer Prepaid Minutes Revenues The Company recognizes revenues from the sale of prepaid telecommunications minutes directly to consumers at the retail level. While the Company collects payment for prepaid consumer minutes in advance, revenue is recognized upon delivery to and consumption of minutes by the consumer or upon the forfeiture of minutes with forfeitures occurring after 12 consecutive months of non-use. Generally, consumers will prepay a fixed dollar amount then consume the prepayment upon making telephone calls on the Company’s telecommunications network. Revenues from direct to consumer retail sales were $266 and $469 and $1,118 and $1,463 during the three and nine months ended September 30, 2018 and 2017, respectively. Wholesale Telecommunications Revenues The Company recognizes revenues from the brokering of sales of minutes from one telecommunications carrier to another. The Company receives an order for a defined number of minutes to a defined geographic region at which point it sources those minutes and purchases them with an immediate resale to the customer. Revenues from wholesale telecommunications minutes were $20,297 and $0 and $60,352 and $0 during the three and nine months ended September 30, 2018 and 2017, respectively. Deferred Revenue Deferred revenue is comprised mainly of unearned revenue related to prepayments from retail consumers for telecommunications minutes. The following table represents the changes in deferred revenue for the nine months ended September 30, 2018: Deferred Revenue Balance at December 31, 2017 686 Deferred revenue 993 Recognition of deferred revenue (1,118 ) Balance at September 30, 2018 561 Revenue allocated to remaining performance obligations represent contracted revenue that has not yet been recognized (“contracted not recognized”). Contracted not recognized revenue was $561 as of September 30, 2018, of which the Company expects to recognize 100% of the revenue over the next 12 months. Assets Recognized from the Costs to Obtain a Contract with a Customer The Company has elected to immediately expense contract acquisition costs that would be amortized in one year or less. The Company recognizes an asset for the incremental costs of obtaining a contract with a customer if the benefit of those costs is expected to be longer than one year. There were no capitalized contract acquisition costs as of September 30, 2018. |
Goodwill and Intangible Assets | Goodwill and Intangible Assets Goodwill represents the excess cost over the fair value of the assets of an acquired business. Goodwill and intangible assets acquired in a business combination accounted for as a purchase and determined to have an indefinite useful life are not amortized but are tested for impairment at least annually. Intangible assets with estimable useful lives are amortized over their respective estimated useful lives to their estimated residual values and reviewed periodically for impairment. The Company evaluates the possible impairment of goodwill annually as part of its reporting process for the fourth quarter of each fiscal year. The Company determines the fair value of each subsidiary the goodwill relates to and compares the fair value to the carrying amount of the subsidiary. To the extent the carrying amount of the subsidiary exceeds the fair value of it, an impairment loss is recorded. Amortization of intangible assets for each of the next five years and thereafter is expected to be as follows: Year ended December 31, 2018 107 2019 429 2020 429 2021 429 2022 429 Thereafter 791 Total 2,614 Amortization expense was $107 and $356 and $0 and $0 for the three and nine months ended September 30, 2018 and 2017, respectively. Amortization expense for each period is included in cost of revenue. |
Derivative and Fair Value of Financial Instruments | Derivative and Fair Value of Financial Instruments Fair value accounting requires bifurcation of embedded derivative instruments such as conversion features in convertible debt or equity instruments and measurement of their fair value for accounting purposes. In assessing the convertible debt instruments, management determines if the convertible debt host instrument is conventional convertible debt and further if there is a beneficial conversion feature requiring measurement. If the instrument is not considered conventional convertible debt under ASC 470, the Company will continue its evaluation process of these instruments as derivative financial instruments under ASC 815. Once determined, derivative liabilities are adjusted to reflect fair value at each reporting period end, with any increase or decrease in the fair value being recorded in results of operations as an adjustment to fair value of derivatives. Fair value of certain of the Company’s financial instruments including cash, accounts receivable, accounts payable, accrued expenses, notes payables, and other accrued liabilities approximate cost because of their short maturities. The Company measures and reports fair value in accordance with ASC 820, “Fair Value Measurements and Disclosure” defines fair value, establishes a framework for measuring fair value in accordance with generally accepted accounting principles and expands disclosures about fair value measurements. Fair value, as defined in ASC 820, is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. The fair value of an asset should reflect its highest and best use by market participants, principal (or most advantageous) markets, and an in-use or an in-exchange valuation premise. The fair value of a liability should reflect the risk of nonperformance, which includes, among other things, the Company’s credit risk. Valuation techniques are generally classified into three categories: the market approach; the income approach; and the cost approach. The selection and application of one or more of the techniques may require significant judgment and are primarily dependent upon the characteristics of the asset or liability, and the quality and availability of inputs. Valuation techniques used to measure fair value under ASC 820 must maximize the use of observable inputs and minimize the use of unobservable inputs. ASC 820 also provides fair value hierarchy for inputs and resulting measurement as follows: Level 1: Quoted prices (unadjusted) in active markets that are accessible at the measurement date for identical assets or liabilities. Level 2: Quoted prices for similar assets or liabilities in active markets; quoted prices for identical or similar assets or liabilities in markets that are not active; inputs other than quoted prices that are observable for the asset or liability; and inputs that are derived principally from or corroborated by observable market data for substantially the full term of the assets or liabilities; and Level 3: Unobservable inputs for the asset or liability that are supported by little or no market activity, and that are significant to the fair values. Fair value measurements are required to be disclosed by the Level within the fair value hierarchy in which the fair value measurements in their entirety fall. Fair value measurements using significant unobservable inputs (in Level 3 measurements) are subject to expanded disclosure requirements including a reconciliation of the beginning and ending balances, separately presenting changes during the period attributable to the following: (i) total gains or losses for the period (realized and unrealized), segregating those gains or losses included in earnings, and a description of where those gains or losses included in earning are reported in the statement of income. The Company’s financial assets and liabilities that are measured at fair value on a recurring basis by level within the fair value hierarchy are as follows: Balance as of September 30, 2018 Level 1 Level 2 Level 3 Total Liabilities: Stock based liabilities 1,059 — — 1,059 Short term derivative value — — — — Long term derivative value 64 — — 64 Total liabilities 1,123 — — 1,123 Balance as of December 31, 2017 Level 1 Level 2 Level 3 Total Liabilities: Stock based liabilities 2,963 — — 2,963 Short term derivative value 212 — — 212 Long term derivative value 362 — — 362 Total liabilities 3,537 — — 3,537 |
Basic Income (Loss) Per Share | Basic Income (Loss) Per Share Basic income (loss) per share is calculated by dividing the Company’s net loss applicable to common shareholders by the weighted average number of common shares during the period. Diluted earnings per share is calculated by dividing the Company’s net income available to common shareholders by the diluted weighted average number of shares outstanding during the year. The diluted weighted average number of shares outstanding is the basic weighted average number of shares adjusted for any potentially dilutive debt or equity. At September 30, 2018, the Company had one outstanding convertible note payable with conversion rights that are exercisable. The amount of outstanding principal on this convertible note is $0 plus accrued interest of $5 for total convertible debt as of September 30, 2018 of $5 representing 2,506 new dilutive common shares if converted at the applicable rates. Additionally, the Company has committed to issue a total of 179,851 shares of common stock for the settlement of a related party note payable and services which are not yet issued or outstanding. The effects of this note and total common shares committed to be issued have been excluded from net income per diluted share for the three and nine months ended September 30, 2018. At September 30, 2017, the Company had eighteen outstanding convertible notes payable with conversion rights that are exercisable. The amount of outstanding principal on these convertible notes total $985 plus accrued interest of $388 for total convertible debts as of September 30, 2017 of $1,328 representing 243,268 new dilutive common shares if converted at the applicable rates. The effects of these notes have been included in net income per diluted share for the three months ended September 30, 2017 and excluded from the nine months ended September 30, 2017. The Net income (loss) attributable to common shareholders for the period ended September 30, 2018 is as the follow: Net income (loss) before controlling interest 70 Reallocation of stock-based compensation 164 Reallocation of Gain from Change in fair value of stock-based liabilities (2,191 ) Net income (loss) attributable to common shareholders (1,957 ) For the nine months ended September 30, 2018, potentially dilutive securities consisted of 179,851 shares which the Company is obligated to issue and 162,044 options to purchase of common stock at prices ranging from $3 to $54 per share. Of these potentially dilutive securities, only 179,851 shares which the Company is obligated to issue and 90,000 options to purchase of common stock at price of $3 per share are included in the computation of diluted earnings per share because the effect of including the remaining instruments would be anti-dilutive. |
Reclassified Amounts | Reclassified Amounts Certain prior year amounts have been reclassified for consistency with the current year presentation. These reclassifications did not have material effect on the reported results of operations, shareholder’s deficit or cash flows. |
Recent Accounting Standards announced | Recent Accounting Standards announced In August 2018, the FASB issued ASU 2018-13, Fair Value Measurement (Topic 820): Disclosure Framework – Changes to the Disclosure Requirements for Fair Value Measurement. The amendments apply to reporting entities that are required to make disclosures about recurring or nonrecurring fair value measurements and should improve the cost, benefit, and effectiveness of the disclosures. ASU 2018-13 categorized the changes into those disclosures that were removed, those that were modified, and those that were added. The primary disclosures that were removed related to transfers between Level 1 and Level 2 investments, along with the policy for timing of transfers between levels. In addition, disclosing the valuation processes for Level 3 fair value measurements was removed. The amendments are effective for all organizations for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2019. Early adoption is permitted. The Company notes that this guidance will impact its disclosures beginning January 1, 2020. |
Recently adopted accounting pronouncements | Recently adopted accounting pronouncements In January 2016, the FASB issued Accounting Standards Update No. 2016-01 (ASU 2016-01) “Financial Instruments-Overall (Subtopic 825-10): Recognition and Measurement of Financial Assets and Financial Liabilities,” which amends various aspects of the recognition, measurement, presentation, and disclosure of financial instruments. We adopted ASU 2016-01 as of January 1, 2018 which resulted in a $300 reclassification of net unrealized gains from accumulated other comprehensive income to the retained earnings. The adoption of ASU 2016-01 increases the volatility of our other income (expense), net, as a result of the remeasurement of our equity securities. |
Summary of Significant Accoun_3
Summary of Significant Accounting Policies and Basis of Presentation (Tables) | 9 Months Ended |
Sep. 30, 2018 | |
Summary of Significant Accounting Policies and Basis of Presentation [Abstract] | |
Schedule of changes in deferred revenue | Deferred Revenue Balance at December 31, 2017 686 Deferred revenue 993 Recognition of deferred revenue (1,118 ) Balance at September 30, 2018 561 |
Schedule of amortization of intangible assets | Year ended December 31, 2018 107 2019 429 2020 429 2021 429 2022 429 Thereafter 791 Total 2,614 |
Schedule of financial assets and liabilities are measured at fair value on a recurring basis | Balance as of September 30, 2018 Level 1 Level 2 Level 3 Total Liabilities: Stock based liabilities 1,059 — — 1,059 Short term derivative value — — — — Long term derivative value 64 — — 64 Total liabilities 1,123 — — 1,123 Balance as of December 31, 2017 Level 1 Level 2 Level 3 Total Liabilities: Stock based liabilities 2,963 — — 2,963 Short term derivative value 212 — — 212 Long term derivative value 362 — — 362 Total liabilities 3,537 — — 3,537 |
Schedule of net income (loss) attributable to common shareholders | Net income (loss) before controlling interest 70 Reallocation of stock-based compensation 164 Reallocation of Gain from Change in fair value of stock-based liabilities (2,191 ) Net income (loss) attributable to common shareholders (1,957 ) |
Notes Payable and Convertible_2
Notes Payable and Convertible Notes Payable (Tables) | 9 Months Ended |
Sep. 30, 2018 | |
Notes Payable and Convertible Notes Payable [Abstract] | |
Schedule of convertible notes payable activity | Holder Issue Date Due Date Original Principal Balance, December 31, Repayments Conversions to Common Stock Forgiveness of Principal Balance, September 30, Noteholder 5 11/9/2015 11/9/201 100 49 (12 ) (27 ) (10 ) - Totals 100 49 (12 ) (27 ) (10 ) - |
Schedule of convertible notes outstanding | Holder Issue Date Due Date Principal Discount Unamortized Debt Issue Costs Carrying Value Accrued Interest Noteholder 6 11/2/2016 11/2/2017 - - - - 5 Totals - - - - 5 |
Derivative Liabilities (Tables)
Derivative Liabilities (Tables) | 9 Months Ended |
Sep. 30, 2018 | |
Derivative Liabilities [Abstract] | |
Schedule of changes in derivative liabilities | Fair Value of Embedded Derivative Liabilities Balance, December 31, 2017 574 Change in fair value (483 ) Change due to conversion (27 ) Balance, September 30, 2018 64 |
Schedule of Black-Scholes option pricing model | September 30, December 31, Common stock price 5.00 17.40 Expected volatility 211 % 178% - 334 % Expected term 1.51 years .01 - 2.25 years Risk free rate 2.81 % 0.97% - 1.89 % Forfeiture rate 0 % 0 % Expected dividend yield 0 % 0 % |
Stock Options (Tables)
Stock Options (Tables) | 9 Months Ended |
Sep. 30, 2018 | |
Stock Options [Abstract] | |
Schedule of stock option activity | Shares Weighted- Outstanding, December 31, 2017 105,378 $ 39.27 Granted 90,000 3.00 Forfeited (33,334 ) 54.00 Outstanding, September 30, 2018 162,044 $ 16.09 |
Schedule of information regarding outstanding and exercisable options | Outstanding Exercisable Exercise Number of Weighted Average Weighted Average Number of Weighted Average $ 54.00 25,000 $ 54.00 1.5 25,000 $ 54.00 21.00 47,044 21.00 1.74 47,044 21.00 3.00 90,000 3.00 4.96 30,000 3.00 162,044 $ 16.09 2.98 102,044 $ 23.79 |
Schedule of Black-Scholes option pricing model | Common stock price 5.05 Dividend yield 0 % Risk-free interest rate 2.87 % Expected term (years) 5 Expected volatility 374.26 % Common stock price 5.05 Dividend yield 0 % Risk-free interest rate 2.87 % Expected term (years) 5 Expected volatility 374.26 % |
Stockholders' Equity (Tables)
Stockholders' Equity (Tables) | 9 Months Ended |
Sep. 30, 2018 | |
Stockholders' Equity [Abstract] | |
Schedule of common stock activity | Summary of common stock activity for the nine months ended September 30, 2018 Outstanding shares Balance, December 31, 2017 1,140,398 Shares issued for common stock subscriptions 38,096 Shares issued as settlement of stock-based liabilities 72,485 Shares issued for services 13,333 Shares issued for rounding from 1:300 reverse stock split 967 Shares issued for settlement of convertible notes payable and accrued interest 4,167 Balance, September 30, 2018 1,269,446 |
Related Party Transactions (Tab
Related Party Transactions (Tables) | 9 Months Ended |
Sep. 30, 2018 | |
Related Party Transaction [Line Items] | |
Schedule of of related party balance | Due from related parties September 30, December 31, (a) Glocal Card Services 36 36 Total Due from related parties 36 36 Related party payables, net of discounts September 30, (unaudited) December 31, (b) Due to Next Communications, Inc. (current) 2,972 2,920 (c) Due to Asiya Communications SAPI de C.V. (current) 36 6 (d) Michael DePrado (current) 100 100 (e) Orlando Taddeo, net of discount of $0 and $72 (due July 21, 2019) 2,613 2,536 (f) Next Cala 360 (current) 12 7 Total related party payables 5,733 5,569 (a) Glocal Card Services is our partner in the Glocal Joint Venture (b) Next Communication, Inc. is a corporation in which our Chief Executive Officer holds a controlling interest and serves as the Chief Executive Officer. The balance with Next Communication, Inc. accrues an annual interest of 8%. (c) Asiya Communications SAPI de C.V.is a telecommunications company organized under the laws of Mexico, in which our Chief Executive Officer holds a substantial interest and is involved in active management. (d) Michael DePrado is the Company’s Chief Operating Officer (e) Amount due to Orlando Taddeo from the acquisition of Limecom (f) Next Cala 360, is a Florida corporation established and managed by our Chief Executive Officer. |
Related Party Revenues [Member] | |
Related Party Transaction [Line Items] | |
Schedule of generated revenues from related parties | For the Three Months Ended 2018 2017 Next Communications, Inc. 4,208 155 VTX Corporation (a) 1,587 Airtime Sp.z.o.o. 5,095 - Asiya Communications SAPI de C.V. 5,052 - Total 15,942 155 (a) A corporation that is owned by one of the Company’s shareholders and a former owner of Limecom For the Nine Months Ended 2018 2017 Next Communications, Inc. 10,021 227 VTX Corporation 11,305 - Airtime Sp.z.o.o. 5,095 - Asiya Communications SAPI de C.V. 10,429 2 Next Cala 360 - 4 Total 36,850 233 |
Related Party Costs of Revenues [Member] | |
Related Party Transaction [Line Items] | |
Schedule of generated revenues from related parties | For the Three Months Ended 2018 2017 Next Communications, Inc. 4,736 - Asiya Communications SAPI de C.V. 4,218 - Total 8,954 - For the Nine Months Ended 2018 2017 Next Communications, Inc. 9,438 - Asiya Communications SAPI de C.V. 10,951 - Total 20,389 - |
Pro Forma Statements of Opera_2
Pro Forma Statements of Operations (Tables) | 9 Months Ended |
Sep. 30, 2018 | |
Pro Forma Statements of Operations [Abstract] | |
Schedule of pro forma statements | Cuentas Limecom Pro Forma Adjustments Pro Forma Revenue $ 1,700 $ 65,743 $ - $ 67,443 Cost of revenue 1,289 63,653 321 (a) 65,263 Gross margin 411 2,090 (321 ) 2,180 Operating expenses General and administrative 2,249 1,491 - 3,740 Total operating expenses 2,249 1,491 - 3,740 Income (loss) from operations (1,838 ) 599 (321 ) (1,560 ) Other income (expense) Other income 730 92 - 822 Interest expense (748 ) (242 ) - (990 ) Loss on derivative liability (306 ) - - (306 ) Total other income (expense) (324 ) (150 ) - (474 ) Net income (loss) from continuing operations $ (2,162 ) $ 449 $ (321 ) $ (2,034 ) (a) Amortization of acquired intangible assets from acquisition |
General (Details)
General (Details) - USD ($) $ in Thousands | Dec. 06, 2017 | Aug. 23, 2018 | Sep. 21, 2005 | Sep. 30, 2018 | Jan. 02, 2018 | Dec. 31, 2017 | Oct. 23, 2017 | Sep. 30, 2017 | Dec. 31, 2016 | May 31, 2016 |
General (Textual) | ||||||||||
Accumulated deficit | $ (14,419) | $ (14,208) | ||||||||
Stockholders' deficiency | (4,032) | (5,172) | ||||||||
Negative working capital | 7,915 | |||||||||
Reverse stock split, description | (i) every three hundred shares of common stock have been combined into one share of common stock; (ii) the number of shares of common stock underlying each common stock option, common stock warrant or any other convertible instrument of the Company have been proportionately decreased on a 300-for-1 basis, and the exercise price of each such outstanding stock option, common warrant or any other convertible instrument of the Company have been proportionately increased on a 300-for-1 basis. Accordingly, all option numbers, share numbers, warrant numbers, share prices, warrant prices, exercise prices and losses per share have been adjusted within these consolidated financial statements, on a retroactive basis, to reflect this 300-for-1 reverse stock split. | |||||||||
Cash and cash equivalents | $ 48 | $ 93 | $ 93 | $ 57 | $ 256 | |||||
Transaction Processing Products, Inc. [Member] | ||||||||||
General (Textual) | ||||||||||
Ownership percentage in subsidiaries | 100.00% | |||||||||
Next Cala, Inc [Member] | ||||||||||
General (Textual) | ||||||||||
Ownership percentage in subsidiaries | 94.00% | |||||||||
Percentage of interests and shares received | 60.00% | |||||||||
NxtGn, Inc. [Member] | ||||||||||
General (Textual) | ||||||||||
Ownership percentage in subsidiaries | 65.00% | |||||||||
Next Mobile 360, Inc. [Member] | ||||||||||
General (Textual) | ||||||||||
Ownership percentage in subsidiaries | 100.00% | |||||||||
Limecom, Inc. [Member] | ||||||||||
General (Textual) | ||||||||||
Percentage of interests and shares received | 100.00% | |||||||||
Meimoun and Mammon, LLC [Member] | ||||||||||
General (Textual) | ||||||||||
Ownership percentage in subsidiaries | 100.00% | |||||||||
Fisk Holdings, LLC [Member] | ||||||||||
General (Textual) | ||||||||||
Business acquisition contribute | $ 500 | |||||||||
Contribution of point sales | 30,000 | |||||||||
SDI NEXT Distribution LLC [Member] | ||||||||||
General (Textual) | ||||||||||
Ownership percentage in subsidiaries | 51.00% | |||||||||
Next Communications, Inc. [Member] | ||||||||||
General (Textual) | ||||||||||
Percentage of acquisition | 50.00% |
Summary of Significant Accoun_4
Summary of Significant Accounting Policies and Basis of Presentation (Details) $ in Thousands | 9 Months Ended |
Sep. 30, 2018USD ($) | |
Summary of Significant Accounting Policies and Basis of Presentation [Abstract] | |
Balance beginning, Deferred revenue | $ 686 |
Deferred revenue | 993 |
Recognition of deferred revenue | (1,118) |
Balance ending, Deferred revenue | $ 561 |
Summary of Significant Accoun_5
Summary of Significant Accounting Policies and Basis of Presentation (Details 1) $ in Thousands | Sep. 30, 2018USD ($) |
Summary of Significant Accounting Policies and Basis of Presentation [Abstract] | |
2,018 | $ 107 |
2,019 | 429 |
2,020 | 429 |
2,021 | 429 |
2,022 | 429 |
Thereafter | 791 |
Total | $ 2,614 |
Summary of Significant Accoun_6
Summary of Significant Accounting Policies and Basis of Presentation (Details 2) - USD ($) $ in Thousands | Sep. 30, 2018 | Dec. 31, 2017 |
Liabilities, Fair Value Disclosure [Abstract] | ||
Total liabilities | $ 1,123 | $ 3,537 |
Stock based liabilities [Member] | ||
Liabilities, Fair Value Disclosure [Abstract] | ||
Total liabilities | 1,059 | 2,963 |
Short term derivative value [Member] | ||
Liabilities, Fair Value Disclosure [Abstract] | ||
Total liabilities | 212 | |
Long term derivative value [Member] | ||
Liabilities, Fair Value Disclosure [Abstract] | ||
Total liabilities | 64 | 362 |
Level 1 [Member] | ||
Liabilities, Fair Value Disclosure [Abstract] | ||
Total liabilities | 1,123 | 3,537 |
Level 1 [Member] | Stock based liabilities [Member] | ||
Liabilities, Fair Value Disclosure [Abstract] | ||
Total liabilities | 1,059 | 2,963 |
Level 1 [Member] | Short term derivative value [Member] | ||
Liabilities, Fair Value Disclosure [Abstract] | ||
Total liabilities | 212 | |
Level 1 [Member] | Long term derivative value [Member] | ||
Liabilities, Fair Value Disclosure [Abstract] | ||
Total liabilities | 64 | 362 |
Level 2 [Member] | ||
Liabilities, Fair Value Disclosure [Abstract] | ||
Total liabilities | ||
Level 2 [Member] | Stock based liabilities [Member] | ||
Liabilities, Fair Value Disclosure [Abstract] | ||
Total liabilities | ||
Level 2 [Member] | Short term derivative value [Member] | ||
Liabilities, Fair Value Disclosure [Abstract] | ||
Total liabilities | ||
Level 2 [Member] | Long term derivative value [Member] | ||
Liabilities, Fair Value Disclosure [Abstract] | ||
Total liabilities | ||
Level 3 [Member] | ||
Liabilities, Fair Value Disclosure [Abstract] | ||
Total liabilities | ||
Level 3 [Member] | Stock based liabilities [Member] | ||
Liabilities, Fair Value Disclosure [Abstract] | ||
Total liabilities | ||
Level 3 [Member] | Short term derivative value [Member] | ||
Liabilities, Fair Value Disclosure [Abstract] | ||
Total liabilities | ||
Level 3 [Member] | Long term derivative value [Member] | ||
Liabilities, Fair Value Disclosure [Abstract] | ||
Total liabilities |
Summary of Significant Accoun_7
Summary of Significant Accounting Policies and Basis of Presentation (Details 3) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2018 | Sep. 30, 2017 | Sep. 30, 2018 | Sep. 30, 2017 | |
Summary of Significant Accounting Policies and Basis of Presentation [Abstract] | ||||
Net income (loss) before controlling interest | $ (469) | $ 1,687 | $ 70 | $ (2,490) |
Reallocation of stock-based compensation | 164 | |||
Reallocation of Gain from Change in fair value of stock-based liabilities | (2,191) | |||
Net income (loss) attributable to common shareholders | $ (1,957) |
Summary of Significant Accoun_8
Summary of Significant Accounting Policies and Basis of Presentation (Details Textual) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | 9 Months Ended | |||||
Sep. 30, 2018 | Sep. 30, 2017 | Sep. 30, 2018 | Sep. 30, 2017 | Dec. 31, 2017 | |||
Summary of Significant Accounting Policies and Basis of Presentation (Textual) | |||||||
Revenues | $ 20,563 | $ 625 | $ 61,472 | $ 1,700 | |||
Revenue allocated to remaining performance obligations | Revenue allocated to remaining performance obligations represent contracted revenue that has not yet been recognized ("contracted not recognized"). Contracted not recognized revenue was $561 as of September 30, 2018, of which the Company expects to recognize 100% of the revenue over the next 12 months. | ||||||
Amortization expense | $ 321 | ||||||
Number of new dilutive common shares | 1,201,083 | 1,191,609 | [1] | 1,301,258 | 906,151 | [1] | |
Additional shares of common stock | 1,269,446 | 1,269,446 | 1,140,398 | ||||
Potentially dilutive securities | 179,851 | ||||||
Common stock at prices | $ 3 | $ 3 | |||||
Purchase of common stock | 90,000 | ||||||
Option [Member] | |||||||
Summary of Significant Accounting Policies and Basis of Presentation (Textual) | |||||||
Potentially dilutive securities | 179,851 | ||||||
Purchase of common stock | 162,044 | ||||||
Option [Member] | Minimum [Member] | |||||||
Summary of Significant Accounting Policies and Basis of Presentation (Textual) | |||||||
Common stock at prices | 3 | $ 3 | |||||
Option [Member] | Maximum [Member] | |||||||
Summary of Significant Accounting Policies and Basis of Presentation (Textual) | |||||||
Common stock at prices | $ 54 | $ 54 | |||||
Convertible notes payable [Member] | |||||||
Summary of Significant Accounting Policies and Basis of Presentation (Textual) | |||||||
Convertible notes outstanding | $ 0 | $ 985 | $ 0 | $ 985 | |||
Accrued interest | 5 | 388 | 5 | 388 | |||
Convertible debts amount | $ 5 | 1,328 | $ 5 | $ 1,328 | |||
Number of new dilutive common shares | 2,506 | 243,268 | |||||
Additional shares of common stock | 179,851 | 179,851 | |||||
Consumer retail sales [Member] | |||||||
Summary of Significant Accounting Policies and Basis of Presentation (Textual) | |||||||
Revenues | $ 266 | 469 | $ 1,118 | $ 1,463 | |||
Wholesale telecommunications [Member] | |||||||
Summary of Significant Accounting Policies and Basis of Presentation (Textual) | |||||||
Revenues | $ 20,297 | $ 0 | $ 60,352 | $ 0 | |||
[1] | Retrospectively adjusted to reflect the 300-for-1 reverse stock split. |
Notes Payable and Convertible_3
Notes Payable and Convertible Notes Payable (Details) - USD ($) $ in Thousands | 9 Months Ended | |
Sep. 30, 2018 | Sep. 30, 2017 | |
Short-term Debt [Line Items] | ||
Repayments | $ (12) | |
Note issued on 11/9/2015 [Member] | ||
Short-term Debt [Line Items] | ||
Holder | Noteholder 5 | |
Issue Date | Nov. 9, 2015 | |
Due Date | Nov. 9, 2016 | |
Original Principal | $ 100 | |
Balance | 49 | |
Repayments | (12) | |
Conversions to Common Stock | (27) | |
Forgiveness of Principal | (10) | |
Balance | ||
Totals [Member] | ||
Short-term Debt [Line Items] | ||
Original Principal | 100 | |
Balance | 49 | |
Repayments | (12) | |
Conversions to Common Stock | (27) | |
Forgiveness of Principal | (10) | |
Balance |
Notes Payable and Convertible_4
Notes Payable and Convertible Notes Payable (Details 1) - USD ($) $ in Thousands | 9 Months Ended | |
Sep. 30, 2018 | Dec. 31, 2017 | |
Short-term Debt [Line Items] | ||
Carrying Value | $ 49 | |
Note issued on 11/2/2016 [Member] | ||
Short-term Debt [Line Items] | ||
Holder | Noteholder 6 | |
Issue Date | Nov. 2, 2016 | |
Due Date | Nov. 2, 2017 | |
Principal | ||
Discount | ||
Unamortized Debt Issue Costs | ||
Carrying Value | ||
Accrued Interest | 5 | |
Totals [Member] | ||
Short-term Debt [Line Items] | ||
Principal | ||
Discount | ||
Unamortized Debt Issue Costs | ||
Carrying Value | ||
Accrued Interest | $ 5 |
Notes Payable and Convertible_5
Notes Payable and Convertible Notes Payable (Details Textual) - USD ($) $ in Thousands | Oct. 23, 2017 | May 01, 2017 | Sep. 30, 2018 | Dec. 31, 2017 | Apr. 25, 2018 |
Notes Payable and Convertible Notes Payable (Textual) | |||||
Loan from an unrelated party | $ 25 | ||||
Cash proceeds | $ 180 | ||||
Future payments from future receivables | $ 234 | ||||
Repayments | $ 385 | $ 95 | $ 10 | ||
Current notes payable | 0 | 46 | |||
Principal balance | $ 25 | ||||
Loan agreement [Member] | |||||
Notes Payable and Convertible Notes Payable (Textual) | |||||
Current notes payable | $ 0 | 0 | |||
Convertible Notes Payable [Member] | |||||
Notes Payable and Convertible Notes Payable (Textual) | |||||
Annual interest rate | 8.00% | ||||
Description of debt conversion terms | The terms of the outstanding convertible notes are substantially similar and accrue interest at 8% annually with a default interest rate of 24% and allow for the conversion of outstanding principal and interest to common stock at a price equal to 45% to 50% from the lowest trading price in the preceding 20 days. | ||||
First loan resulted [Member] | |||||
Notes Payable and Convertible Notes Payable (Textual) | |||||
Cash proceeds | 125 | ||||
Future payments from future receivables | 169 | ||||
Repayments | 1 | ||||
Second resulted [Member] | |||||
Notes Payable and Convertible Notes Payable (Textual) | |||||
Cash proceeds | 50 | ||||
Future payments from future receivables | 68 | ||||
Repayments | $ 10 |
Derivative Liabilities (Details
Derivative Liabilities (Details) | 9 Months Ended |
Sep. 30, 2018USD ($) | |
Fair Value of Embedded Derivative Liabilities: | |
Balance, Beginning | $ 574 |
Change in fair value | (483) |
Change due to conversion | (27) |
Balance, Ending | $ 64 |
Derivative Liabilities (Detai_2
Derivative Liabilities (Details 1) - $ / shares | 9 Months Ended | 12 Months Ended |
Sep. 30, 2018 | Dec. 31, 2017 | |
Derivative [Line Items] | ||
Common stock price | $ 5 | $ 17.40 |
Expected volatility | 211.00% | |
Expected term | 1 year 6 months 3 days | |
Risk free rate | 2.81% | |
Forfeiture rate | 0.00% | 0.00% |
Expected dividend yield | 0.00% | 0.00% |
Maximum [Member] | ||
Derivative [Line Items] | ||
Expected volatility | 334.00% | |
Expected term | 2 years 2 months 30 days | |
Risk free rate | 1.89% | |
Minimum [Member] | ||
Derivative [Line Items] | ||
Expected volatility | 178.00% | |
Expected term | 0 years | |
Risk free rate | 0.97% |
Derivative Liabilities (Detai_3
Derivative Liabilities (Details Textual) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2018 | Sep. 30, 2017 | Sep. 30, 2018 | Sep. 30, 2017 | |
Derivative Liabilities (Textual) | ||||
Derivative liability | $ 64 | $ 64 | ||
Gain from derivative fair value adjustment | $ 56 | $ 1,687 | $ 483 | $ (306) |
Derivative liability exercisable, description | The options are exercisable at $54 per share unless the Company's common stock is quoted at a price greater than $150 per share at which point the options are exercisable at $90 per share. |
Stock Options (Details)
Stock Options (Details) - Stock Option [Member] | 9 Months Ended |
Sep. 30, 2018$ / sharesshares | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Outstanding, Beginning | shares | 105,378 |
Granted | shares | 90,000 |
Forfeited | shares | (33,334) |
Outstanding, Ending | shares | 162,044 |
Weighted - Average Exercise Price Per Share Outstanding, Beginning | $ / shares | $ 39.27 |
Weighted - Average Exercise Price Per Share, Granted | $ / shares | 3 |
Weighted - Average Exercise Price Per Share, Forfeited | $ / shares | 54 |
Weighted - Average Exercise Price Per Share Outstanding, Ending | $ / shares | $ 16.09 |
Stock Options (Details 1)
Stock Options (Details 1) - Stock Option [Member] - $ / shares | 9 Months Ended | ||
Sep. 30, 2018 | Jan. 02, 2018 | Dec. 31, 2017 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Outstanding, Number of Option Shares | 162,044 | 105,378 | 105,378 |
Outstanding, Weighted Average Exercise Price | $ 16.09 | $ 39.27 | $ 39.27 |
Outstanding, Weighted Average Remaining Life (Years) | 2 years 11 months 23 days | ||
Exercisable, Number of Option Shares | 102,044 | ||
Exercisable, Weighted Average Exercise Price | $ 23.79 | ||
54.00 Exercise Prices [Member] | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Exercise Prices | $ 54 | ||
Outstanding, Number of Option Shares | 25,000 | ||
Outstanding, Weighted Average Exercise Price | $ 54 | ||
Outstanding, Weighted Average Remaining Life (Years) | 1 year 6 months | ||
Exercisable, Number of Option Shares | 25,000 | ||
Exercisable, Weighted Average Exercise Price | $ 54 | ||
21.00 Exercise Prices [Member] | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Exercise Prices | $ 21 | ||
Outstanding, Number of Option Shares | 47,044 | ||
Outstanding, Weighted Average Exercise Price | $ 21 | ||
Outstanding, Weighted Average Remaining Life (Years) | 1 year 8 months 26 days | ||
Exercisable, Number of Option Shares | 47,044 | ||
Exercisable, Weighted Average Exercise Price | $ 21 | ||
3.00 Exercise Prices [Member] | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Exercise Prices | $ 3 | ||
Outstanding, Number of Option Shares | 90,000 | ||
Outstanding, Weighted Average Exercise Price | $ 3 | ||
Outstanding, Weighted Average Remaining Life (Years) | 4 years 11 months 15 days | ||
Exercisable, Number of Option Shares | 30,000 | ||
Exercisable, Weighted Average Exercise Price | $ 3 |
Stock Options (Details 2)
Stock Options (Details 2) - $ / shares | Sep. 13, 2018 | Sep. 30, 2018 | Dec. 31, 2017 |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Common stock price | $ 5 | $ 17.40 | |
60,000 options [Member] | Chief Executive Office [Member] | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Common stock price | $ 5.05 | ||
Dividend yield | 0.00% | ||
Risk-free interest rate | 2.87% | ||
Expected term (years) | 5 years | ||
Expected volatility | 374.26% | ||
30,000 options [Member] | Board [Member] | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Common stock price | $ 5.05 | ||
Dividend yield | 0.00% | ||
Risk-free interest rate | 2.87% | ||
Expected term (years) | 5 years | ||
Expected volatility | 374.26% |
Stock Options (Details Textual)
Stock Options (Details Textual) - Stock Option [Member] - USD ($) $ / shares in Units, $ in Thousands | Sep. 13, 2018 | Sep. 30, 2018 |
Stock Options (Textual) | ||
Options exercise price per share | $ 23.79 | |
Stock based expense | $ 164 | |
Board [Member] | ||
Stock Options (Textual) | ||
Options issued | 30,000 | |
Exercise price of options | $ 3 | |
Option value | $ 151 | |
Chief Executive Officer [Member] | ||
Stock Options (Textual) | ||
Options issued | 60,000 | |
Exercise price of options | $ 3 | |
Option value | $ 302 |
Stockholders' Equity (Details)
Stockholders' Equity (Details) | 9 Months Ended |
Sep. 30, 2018shares | |
Reclassification Adjustment out of Accumulated Other Comprehensive Income [Line Items] | |
Balance, September 30, 2018 | 1,269,446 |
Common Stock [Member] | |
Reclassification Adjustment out of Accumulated Other Comprehensive Income [Line Items] | |
Balance, December 31, 2017 | 1,140,398 |
Shares issued for common stock subscriptions | 38,096 |
Shares issued as settlement of stock based liabilities | 72,485 |
Shares issued for services | 13,333 |
Shares issued for rounding from 1:300 reverse stock split | 967 |
Shares issued for settlement of convertible notes payable and accrued interest | 4,167 |
Balance, September 30, 2018 | 1,269,446 |
Stockholders' Equity (Details T
Stockholders' Equity (Details Textual) - USD ($) $ / shares in Units, $ in Thousands | Sep. 11, 2018 | Feb. 07, 2018 | Jan. 12, 2018 | Jan. 09, 2018 | Dec. 31, 2018 | Nov. 28, 2018 | Nov. 20, 2018 | Oct. 25, 2018 | Sep. 27, 2018 | Sep. 21, 2018 | Aug. 23, 2018 | Sep. 30, 2018 | Dec. 13, 2018 | Dec. 31, 2017 |
Stockholders' Equity (Textual) | ||||||||||||||
Common stock, shares authorized | 360,000,000 | 360,000,000 | ||||||||||||
Common stock, par value | $ 0.001 | $ 0.001 | ||||||||||||
Options to purchase common stock issued | 105,378 | |||||||||||||
Convertible notes payable and accrued interest | 1,472 | |||||||||||||
Reverse stock split of common stock, description | (i) every three hundred shares of common stock have been combined into one share of common stock; (ii) the number of shares of common stock underlying each common stock option, common stock warrant or any other convertible instrument of the Company have been proportionately decreased on a 300-for-1 basis, and the exercise price of each such outstanding stock option, common warrant or any other convertible instrument of the Company have been proportionately increased on a 300-for-1 basis. Accordingly, all option numbers, share numbers, warrant numbers, share prices, warrant prices, exercise prices and losses per share have been adjusted within these consolidated financial statements, on a retroactive basis, to reflect this 300-for-1 reverse stock split. | |||||||||||||
Common Stock, Shares, Issued | 1,269,446 | 1,140,398 | ||||||||||||
Fair market value | $ 335 | |||||||||||||
Securities Purchase Agreement [Member] | Limecom, Inc. [Member] | ||||||||||||||
Stockholders' Equity (Textual) | ||||||||||||||
Common stock shares issued | 16,667 | |||||||||||||
Securities Purchase Agreement [Member] | President and CEO[Member] | ||||||||||||||
Stockholders' Equity (Textual) | ||||||||||||||
Common stock shares issued | 146,669 | 16,667 | ||||||||||||
Common stock shares issued in consideration | $ 440 | |||||||||||||
Cash received | $ 140 | |||||||||||||
Subsequent Event [Member] | ||||||||||||||
Stockholders' Equity (Textual) | ||||||||||||||
Common stock consultant, pursuant | 82,667 | 36,667 | 36,667 | 35,834 | ||||||||||
Subsequent Event [Member] | Securities Purchase Agreement [Member] | ||||||||||||||
Stockholders' Equity (Textual) | ||||||||||||||
Common Stock, Shares, Issued | 30,001 | |||||||||||||
Series B Preferred Stock [Member] | ||||||||||||||
Stockholders' Equity (Textual) | ||||||||||||||
Preferred stock, par value | $ 0.001 | $ 0.001 | ||||||||||||
Preferred stock, shares designated | 10,000,000 | 10,000,000 | ||||||||||||
Preferred stock, shares outstanding | 10,000,000 | 10,000,000 | ||||||||||||
Preferred stock, shares issued | 10,000,000 | 10,000,000 | ||||||||||||
Issuance of common stock in conversion of convertible notes payable | ||||||||||||||
Common Stock [Member] | ||||||||||||||
Stockholders' Equity (Textual) | ||||||||||||||
Issuance of common stock in conversion of convertible notes payable | $ 2,167 | $ 2,000 | ||||||||||||
Stock issued for settlement of stock based liabilities | 11,483 | |||||||||||||
Common stock committed to subscribed for cash | 38,096 | |||||||||||||
Common stock issued exercisable | 13,333 | |||||||||||||
Fair market value | $ 11 | $ 400 | $ 27 | $ 155 | $ 60 | |||||||||
Common stock consultant, pursuant | 61,002 |
Related Party Transactions (Det
Related Party Transactions (Details) - USD ($) $ in Thousands | Sep. 30, 2018 | Dec. 31, 2017 | |
Due from related parties | |||
Glocal Card Services | [1] | $ 36 | $ 36 |
Total Due from related parties | 36 | 36 | |
Related party payables, net of discounts | |||
Due to Next Communications, Inc. (current) | [2] | 2,972 | 2,920 |
Due to Asiya Communications SAPI de C.V. (current) | [3] | 36 | 6 |
Michael DePrado (current) | [4] | 100 | 100 |
Orlando Taddeo, net of discount of $0 and $72 (due July 21, 2019) | [5] | 2,613 | 2,536 |
Next Cala 360 (current) | [6] | 12 | 7 |
Total related party payables | $ 5,733 | $ 5,569 | |
[1] | Glocal Card Services is our partner in the Glocal Joint Venture | ||
[2] | Next Communication, Inc. is a corporation in which our Chief Executive Officer holds a controlling interest and serves as the Chief Executive Officer. The balance with Next Communication, Inc. accrues an annual interest of 8%. | ||
[3] | Asiya Communications SAPI de C.V.is a telecommunications company organized under the laws of Mexico, in which our Chief Executive Officer holds a substantial interest and is involved in active management. | ||
[4] | Michael DePrado is the Company's Chief Operating Officer | ||
[5] | Amount due to Orlando Taddeo from the acquisition of Limecom | ||
[6] | Next Cala 360, is a Florida corporation established and managed by our Chief Executive Officer. |
Related Party Transactions (D_2
Related Party Transactions (Details 1) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | |||
Sep. 30, 2018 | Sep. 30, 2017 | Sep. 30, 2018 | Sep. 30, 2017 | ||
Related Party Transaction [Line Items] | |||||
Total | $ 15,942 | $ 155 | $ 36,850 | $ 233 | |
Related Party Revenues [Member] | |||||
Related Party Transaction [Line Items] | |||||
Next Communications, Inc. | 4,208 | 155 | 10,021 | 227 | |
VTX Corporation | 1,587 | [1] | 11,305 | ||
Airtime Sp.z.o.o. | 5,095 | 5,095 | |||
Asiya Communications SAPI de C.V. | 5,052 | 10,429 | 2 | ||
Next Cala 360 | 4 | ||||
Total | 15,942 | 155 | 36,850 | 233 | |
Related Party Costs of Revenues [Member] | |||||
Related Party Transaction [Line Items] | |||||
Next Communications, Inc. | 4,736 | 9,438 | |||
Asiya Communications SAPI de C.V. | 4,218 | 10,951 | |||
Total | $ 8,954 | $ 20,389 | |||
[1] | A corporation that is owned by one of the Company's shareholders and a former owner of Limecom |
Related Party Transactions (D_3
Related Party Transactions (Details Textual) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | |||
Sep. 30, 2018 | Sep. 30, 2017 | Sep. 30, 2018 | Sep. 30, 2017 | Dec. 31, 2017 | |
Related Party Transactions (Textual) | |||||
Interest rate of related party | 9.00% | ||||
Revenues from related parties | $ 15,942 | $ 155 | $ 36,850 | $ 233 | |
Purchases from related parties | 8,954 | $ 0 | 20,389 | $ 0 | |
Outstanding accounts receivable | 78 | 78 | |||
Related party net of discount | 0 | $ 0 | $ 72 | ||
Related party long term due | Jul. 21, 2019 | ||||
Asiya Communications SAPI de C.V. [Member] | |||||
Related Party Transactions (Textual) | |||||
Outstanding accounts receivable | 14 | $ 14 | |||
Accounts payable, related party | 507 | $ 507 | |||
Next Communications, Inc. [Member] | |||||
Related Party Transactions (Textual) | |||||
Interest rate of related party | 8.00% | 8.00% | |||
Outstanding accounts receivable | 71 | $ 71 | |||
Next Cala 360 [Member] | |||||
Related Party Transactions (Textual) | |||||
Outstanding accounts receivable | 6 | 6 | |||
Limecom, Inc. [Member] | |||||
Related Party Transactions (Textual) | |||||
Outstanding accounts receivable | $ 4,094 | $ 4,094 |
Customer Concentration (Details
Customer Concentration (Details) | 3 Months Ended | 9 Months Ended | 12 Months Ended | ||
Sep. 30, 2018SeparateCustomer | Sep. 30, 2017Customers | Sep. 30, 2018SeparateCustomer | Sep. 30, 2017Customers | Dec. 31, 2017SeparateCustomer | |
Related party [Member] | |||||
Customer Concentration (Textual) | |||||
Concentration risk, percentage | 70.00% | 52.00% | |||
Revenues [Member] | |||||
Customer Concentration (Textual) | |||||
Concentration risk, percentage | 10.00% | 10.00% | |||
Number of customers | Customers | 1 | 1 | |||
Accounts receivable [Member] | |||||
Customer Concentration (Textual) | |||||
Concentration risk, percentage | 98.00% | 78.00% | |||
Number of customers | SeparateCustomer | 3 | 3 | 3 |
Restatement of the Three and _2
Restatement of the Three and Nine Months Ended September 30, 2017 (Details) | 9 Months Ended |
Sep. 30, 2018 | |
Restatement of the Three and Nine Months Ended September 30, 2017 (Textual) | |
Restatement, description | The Company has restated its statement of operations and statement of cash flows for the nine months ended September 30, 2017 to correct an error in the treatment of the disposal of a subsidiary. The Company had originally recorded the elimination of the non-controlling interest component of equity of the sold subsidiary as an equity only transaction by absorbing $2,541 of non-controlling interest equity into that of the Company. The correct treatment of the disposal necessitates the amount of non-controlling interest to be included in the calculation of the gain or loss on the disposal of a subsidiary recognized through the income statement. The impact to the financial statements is an increase in loss from discontinued operations and net loss by $2,541 for the nine months ended September 30, 2017 and no change for the three months ended September 30, 2017. Net loss per common share increased from $0.00 as originally stated to $2.73 as restated for the nine months ended September 30, 2017 with no change for the three months ended September 30, 2017. There was no impact on the net cash used in operations during the nine months ended September 30, 2017 as a result of the restatement. Although not presented, the impact of the restatement on the Company's consolidated balance sheet as of September 30, 2017 is an increase to additional paid in capital and increase to accumulated deficit of $2,541. |
Commitments and Contingencies (
Commitments and Contingencies (Details) - USD ($) $ in Thousands | Aug. 09, 2018 | Feb. 12, 2018 | Oct. 23, 2017 | Apr. 07, 2016 | Dec. 18, 2018 | Dec. 20, 2017 | Sep. 30, 2018 | Dec. 31, 2017 | Dec. 31, 2016 |
Commitments and Contingencies (Textual) | |||||||||
Commitments, description | The agreement requires 1% of the outstanding common share equivalent to be issued to the third party when the market capitalization of the Company reaches $500 and an additional 1% when it reaches $750. | ||||||||
Legal settlement alleging claim, description | Even though NGH made the agreed payment of $10 on January 2, 2017 and issued 12,002 shares as conversion of the $70 note as agreed in the settlement agreement. | ||||||||
Reimbursement of attorneys fees and costs | $ 528 | ||||||||
Accrued liabilities | $ 676 | $ 571 | $ 546 | ||||||
Long term accrued liabilities | 0 | 120 | |||||||
Monthly rental payments of lease | 5 | ||||||||
Future guaranteed payments under lease | $ 5 | ||||||||
Lease expiration date | Oct. 31, 2018 | ||||||||
Claim for related party | $ 473 | ||||||||
Settlement agreement | The Company entered into separate settlement agreements, totaling approximately $1,147. | ||||||||
Repayments | 385 | $ 95 | 10 | ||||||
Outstanding balance | 571 | 666 | |||||||
Acquisition outstanding balance | $ 892 | 507 | |||||||
Other long-term accounts liabilities | 97 | $ 120 | |||||||
Other accounts liabilities | $ 410 | ||||||||
Limecom owes total amount | $ 439 | ||||||||
Subsequent Event [Member] | |||||||||
Commitments and Contingencies (Textual) | |||||||||
Settlement agreement | Limecom had entered into a second Amendment of the Settlement Agreement with American Express. Under the second Amendment Limecom paid $25 on December 19, 2018 and the remaining balance in 13 installments through December 15, 2019. |
Pro Forma Statements of Opera_3
Pro Forma Statements of Operations (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | |||
Sep. 30, 2018 | Sep. 30, 2017 | Sep. 30, 2018 | Sep. 30, 2017 | ||
Business Acquisition [Line Items] | |||||
Cost of revenue | $ 20,458 | $ 503 | $ 60,372 | $ 1,289 | |
Gross margin | 105 | 122 | 1,100 | 411 | |
Operating expenses | |||||
General and administrative | 1,119 | 522 | 2,817 | 2,249 | |
Total operating expenses | 1,119 | 522 | 2,817 | 2,249 | |
Loss from operations | (1,014) | (400) | (1,717) | (1,838) | |
Other income (expense) | |||||
Other income | 197 | 550 | 197 | 730 | |
Interest expense | (156) | (150) | (904) | (748) | |
Loss on derivative liability | 56 | 1,687 | 483 | (306) | |
Total other income (expense) | 545 | 2,087 | 1,787 | (324) | |
Net income (loss) from continuing operations | $ (469) | 1,687 | $ 70 | $ (2,490) | |
Pro Forma Adjustments [Member] | |||||
Business Acquisition [Line Items] | |||||
Revenue | |||||
Cost of revenue | [1] | 321 | |||
Gross margin | (321) | ||||
Operating expenses | |||||
General and administrative | |||||
Total operating expenses | |||||
Loss from operations | (321) | ||||
Other income (expense) | |||||
Other income | |||||
Interest expense | |||||
Loss on derivative liability | |||||
Total other income (expense) | |||||
Net income (loss) from continuing operations | (321) | ||||
Pro Forma [Member] | |||||
Business Acquisition [Line Items] | |||||
Revenue | 67,443 | ||||
Cost of revenue | 65,263 | ||||
Gross margin | 2,180 | ||||
Operating expenses | |||||
General and administrative | 3,740 | ||||
Total operating expenses | 3,740 | ||||
Loss from operations | (1,560) | ||||
Other income (expense) | |||||
Other income | 822 | ||||
Interest expense | (990) | ||||
Loss on derivative liability | (306) | ||||
Total other income (expense) | (474) | ||||
Net income (loss) from continuing operations | (2,034) | ||||
Cuentas [Member] | |||||
Business Acquisition [Line Items] | |||||
Revenue | 1,700 | ||||
Cost of revenue | 1,289 | ||||
Gross margin | 411 | ||||
Operating expenses | |||||
General and administrative | 2,249 | ||||
Total operating expenses | 2,249 | ||||
Loss from operations | (1,838) | ||||
Other income (expense) | |||||
Other income | 730 | ||||
Interest expense | (748) | ||||
Loss on derivative liability | (306) | ||||
Total other income (expense) | (324) | ||||
Net income (loss) from continuing operations | (2,162) | ||||
Limecom [Member] | |||||
Business Acquisition [Line Items] | |||||
Revenue | 65,743 | ||||
Cost of revenue | 63,653 | ||||
Gross margin | 2,090 | ||||
Operating expenses | |||||
General and administrative | 1,491 | ||||
Total operating expenses | 1,491 | ||||
Loss from operations | 599 | ||||
Other income (expense) | |||||
Other income | 92 | ||||
Interest expense | (242) | ||||
Loss on derivative liability | |||||
Total other income (expense) | (150) | ||||
Net income (loss) from continuing operations | $ 449 | ||||
[1] | Amortization of acquired intangible assets from acquisition |
Subsequent Events (Details)
Subsequent Events (Details) - USD ($) $ / shares in Units, $ in Thousands | Nov. 06, 2018 | Dec. 31, 2018 | Dec. 18, 2018 | Nov. 28, 2018 | Nov. 26, 2018 | Nov. 20, 2018 | Oct. 25, 2018 | Dec. 31, 2016 | Dec. 13, 2018 | Sep. 30, 2018 | Dec. 31, 2017 |
Subsequent Events (Textual) | |||||||||||
Common stock, shares issued | 1,269,446 | 1,140,398 | |||||||||
Settlement agreement | The Company entered into separate settlement agreements, totaling approximately $1,147. | ||||||||||
Subsequent Events [Member] | |||||||||||
Subsequent Events (Textual) | |||||||||||
Accounts receivable factoring agreement, description | The Company, through Limecom, the Company's wholly owned subsidiary, finalized an accounts receivable factoring agreement whereby the factor agent will purchase outstanding accounts receivable at its sole discretion less certain commissions. The factoring agent commission due under the agreement is 1.19% of the face value of the purchased accounts receivable for the twenty days immediately following invoice issuance plus 0.59% for each twenty days thereafter. The factoring agent may advance cash to the Company at its sole discretion up to 90% of the purchase price with an initial maximum advance capacity of $4,000. The Company may request increases to the maximum advance allowed under the agreement not to exceed an additional $1,000 during each 90-day period immediately following execution for up to a maximum advance of $8,000. | ||||||||||
Line of credit, description | The Company agreed to pay ThinkEquity, a division of Fordham Financial Management Inc. ("Think"), a 2.5% fee on the initial $4 million factoring limit, equal to $100 in 4 installments for acting as a financial advisor to the Company with respect to the Agreement. Think will be paid additional fees of 3% of any increase in the facility size above the $4,000 facility up to the $8,000 total amount of the factoring facility. Think will also receive a warrant, valid for 5 years, entitling it to purchase a number of shares equal to 3.5% of the maximum facility size. The warrant shall have an exercise price equal to the five (5) day volume weighted average price of common shares on the date of closing, or if the Company is not publicly traded, equal to the per share price paid by investors in the Company's most recent equity investment round prior to the execution of the Agreement. The shares underlying the warrant shall entitle the holder to one-time "piggyback" registration rights (unless Rule 144 is then available). The warrant may be exchanged without the payment of any additional consideration for the Company's stock based upon the values of the warrant and the stock at the time of the exchange. | ||||||||||
Received under a private placement of securities | $ 248 | $ 100 | $ 100 | $ 108 | |||||||
Shares, issued | 82,667 | 36,667 | 36,667 | 35,834 | |||||||
Warrants to purchase of common stock | 82,667 | 36,667 | 36,667 | ||||||||
Warrants exercise price | $ 3.25 | $ 3.25 | $ 3.25 | ||||||||
Issuance cost | $ 10 | $ 10 | $ 8 | ||||||||
Settlement agreement | Limecom had entered into a second Amendment of the Settlement Agreement with American Express. Under the second Amendment Limecom paid $25 on December 19, 2018 and the remaining balance in 13 installments through December 15, 2019. | ||||||||||
Claiming damages amount of Limecom | $ 507 | ||||||||||
Subsequent Events [Member] | Securities Purchase Agreement [Member] | |||||||||||
Subsequent Events (Textual) | |||||||||||
Common stock, shares issued | 30,001 | ||||||||||
Common Stock consideration | $ 90 |