Document and Entity Information
Document and Entity Information - shares | 6 Months Ended | |
Jun. 30, 2019 | Aug. 15, 2019 | |
Document and Entity Information [Abstract] | ||
Entity Registrant Name | Arista Financial Corp. | |
Entity Central Index Key | 0001498122 | |
Amendment Flag | false | |
Current Fiscal Year End Date | --12-31 | |
Document Type | 10-Q | |
Document Period End Date | Jun. 30, 2019 | |
Document Fiscal Period Focus | Q2 | |
Document Fiscal Year Focus | 2019 | |
Entity Current Reporting Status | Yes | |
Entity Filer Category | Non-accelerated Filer | |
Entity Small Business | true | |
Entity Shell Company | false | |
Entity Emerging Growth Company | false | |
Entity Ex Transition Period | false | |
Entity Common Stock, Shares Outstanding | 4,502,410 | |
Entity File Number | 333-169802 | |
Entity Interactive Data Current | Yes | |
Entity Incorporation State Country Code | NV |
Condensed Consolidated Balance
Condensed Consolidated Balance Sheets - USD ($) | Jun. 30, 2019 | Dec. 31, 2018 |
CURRENT ASSETS: | ||
Cash | $ 1,175 | $ 10,357 |
Financing leases receivable, net | 37,160 | 61,655 |
Due from lease service provider | 6,801 | 6,306 |
Prepaid expenses | 1,721 | |
Total Current Assets | 45,136 | 80,039 |
LONG-TERM ASSETS: | ||
Financing leases receivable, net | 1,062 | 16,431 |
Total Long-term Assets | 1,062 | 16,431 |
Total Assets | 46,198 | 96,470 |
CURRENT LIABILITIES: | ||
Notes payable - related parties, net | 10,000 | 12,500 |
Accounts payable | 297,972 | 204,590 |
Line of credit - related party | 70,000 | 70,000 |
Accrued interest payable | 57,922 | 13,167 |
Accrued interest payable - related parties | 5,508 | 3,113 |
Convertible notes payable, net | 416,439 | |
Accrued expenses | 211,016 | 153,448 |
Total Current Liabilities | 1,068,857 | 456,818 |
LONG-TERM LIABILITIES: | ||
Convertible notes payable, net | 210,835 | 479,174 |
Total Long-term Liabilities | 210,835 | 479,174 |
Total Liabilities | 1,279,692 | 935,992 |
Redeemable Series A Preferred stock, $0.0001 par value; 51 shares authorized 51 and 51 shares issued and outstanding as of June 30, 2019 and December 31, 2018, respectively | 51,000 | 51,000 |
Commitments and Contingencies (See Note 8) | ||
STOCKHOLDERS' DEFICIT: | ||
Preferred stock, $0.0001 par value, 10,000,000 shares authorized; | ||
Common stock: $0.0001 par value, 200,000,000 shares authorized; 3,668,410 and 3,433,083 shares issued and outstanding at June 30, 2019 and December 31, 2018, respectively | 367 | 343 |
Additional paid-in capital | 1,468,825 | 1,208,320 |
Accumulated deficit | (2,753,686) | (2,099,185) |
Total Stockholders' Deficit | (1,284,494) | (890,522) |
Total Liabilities and Stockholders' Deficit | $ 46,198 | $ 96,470 |
Condensed Consolidated Balanc_2
Condensed Consolidated Balance Sheets (Parenthetical) - $ / shares | Jun. 30, 2019 | Dec. 31, 2018 |
Statement of Financial Position [Abstract] | ||
Redeemable Series A Preferred stock, par value | $ 0.0001 | $ 0.0001 |
Redeemable Series A Preferred stock, shares authorized | 51 | 51 |
Redeemable Series A Preferred stock, shares issued | 51 | 51 |
Redeemable Series A Preferred stock, shares outstanding | 51 | 51 |
Preferred stock, par value | $ 0.0001 | $ 0.0001 |
Preferred stock, shares authorized | 10,000,000 | 10,000,000 |
Common stock, per share | $ 0.0001 | $ 0.0001 |
Common stock, shares authorized | 200,000,000 | 200,000,000 |
Common stock, shares issued | 3,668,410 | 3,433,083 |
Common stock, shares outstanding | 3,668,410 | 3,433,083 |
Condensed Consolidated Statemen
Condensed Consolidated Statements of Operations (Unaudited) - USD ($) | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2019 | Jun. 30, 2018 | Jun. 30, 2019 | Jun. 30, 2018 | |
REVENUES: | ||||
Interest on lease financings | $ 2,454 | $ 2,781 | $ 5,826 | $ 6,454 |
Total revenues | 2,454 | 2,781 | 5,826 | 6,454 |
OPERATING EXPENSES: | ||||
Compensation and benefits | 94,920 | 101,661 | 238,764 | 202,283 |
Professional fees | 100,644 | 105,768 | 143,367 | 192,648 |
Provision for lease losses | (2,650) | (4,037) | (3,840) | (8,213) |
General and administrative expenses | 44,657 | 18,974 | 58,821 | 29,937 |
Total operating expenses | 237,571 | 222,366 | 437,112 | 416,655 |
LOSS FROM OPERATIONS | (235,117) | (219,585) | (431,286) | (410,201) |
OTHER (INCOME) EXPENSES: | ||||
Interest expense | 96,272 | 31,313 | 218,087 | 62,816 |
Interest expense - related parties | 2,537 | 8,538 | 5,127 | 18,173 |
Gain on sale of equipment | (1,605) | (1,605) | ||
Total other expenses | 98,809 | 38,246 | 223,214 | 79,384 |
LOSS BEFORE INCOME TAXES | (333,926) | (257,831) | (654,500) | (489,585) |
PROVISION FOR INCOME TAXES | ||||
NET LOSS | $ (333,926) | $ (257,831) | $ (654,500) | $ (489,585) |
NET LOSS PER COMMON SHARE: | ||||
Basic and Diluted | $ (0.1) | $ (0.25) | $ (0.19) | $ (0.16) |
WEIGHTED AVERAGE COMMON SHARES OUTSTANDING: | ||||
Basic and Diluted | 3,467,544 | 1,042,000 | 3,506,720 | 3,147,608 |
Condensed Consolidated Statem_2
Condensed Consolidated Statements of Changes In Stockholders' Deficit (Unaudited) - USD ($) | Preferred Stock | Common Stock | Additional Paid-in Capital | Accumulated Deficit | Total |
Balance at Dec. 31, 2017 | $ 309 | $ 534,353 | $ (934,493) | $ (399,831) | |
Balance, shares at Dec. 31, 2017 | 3,088,333 | ||||
Shares issued for services | $ 7 | 145,803 | 145,810 | ||
Shares issued for services, shares | 70,000 | ||||
Shares issued upon conversion of debt | $ 11 | 90,534 | 90,545 | ||
Shares issued upon conversion of debt, shares | 113,750 | ||||
Warrants issued in connection with convertible notes | 16,939 | 16,939 | |||
Net loss | (489,585) | (489,585) | |||
Balance at Jun. 30, 2018 | $ 327 | 787,629 | (1,424,078) | (636,122) | |
Balance, shares at Jun. 30, 2018 | 3,272,083 | ||||
Balance at Mar. 31, 2018 | $ 315 | 637,751 | (1,166,247) | (528,181) | |
Balance, shares at Mar. 31, 2018 | 3,148,333 | ||||
Shares issued for services | $ 1 | 42,404 | 42,405 | ||
Shares issued for services, shares | 10,000 | ||||
Shares issued upon conversion of debt | $ 11 | 90,534 | 90,545 | ||
Shares issued upon conversion of debt, shares | 113,750 | ||||
Warrants issued in connection with convertible notes | 16,940 | 16,940 | |||
Net loss | (257,831) | (257,831) | |||
Balance at Jun. 30, 2018 | $ 327 | 787,629 | (1,424,078) | (636,122) | |
Balance, shares at Jun. 30, 2018 | 3,272,083 | ||||
Balance at Dec. 31, 2018 | $ 343 | 1,208,320 | (2,099,185) | (890,522) | |
Balance, shares at Dec. 31, 2018 | 3,433,083 | ||||
Shares issued for services | $ 9 | 136,254 | 136,263 | ||
Shares issued for services, shares | 84,000 | ||||
Shares issued upon conversion of debt | $ 15 | 11,685 | 11,700 | ||
Shares issued upon conversion of debt, shares | 151,327 | ||||
Warrants issued in connection with convertible notes | 16,427 | 16,427 | |||
Beneficial conversion feature on convertible notes | 96,139 | 96,139 | |||
Net loss | (654,500) | (654,500) | |||
Balance at Jun. 30, 2019 | $ 367 | 1,468,825 | (2,753,685) | (1,284,494) | |
Balance, shares at Jun. 30, 2019 | 3,668,410 | ||||
Balance at Mar. 31, 2019 | $ 349 | 1,369,747 | (2,419,759) | (1,049,663) | |
Balance, shares at Mar. 31, 2019 | 3,490,577 | ||||
Shares issued for services | $ 3 | 48,133 | 48,136 | ||
Shares issued for services, shares | 32,000 | ||||
Shares issued upon conversion of debt | $ 15 | 9,185 | 9,200 | ||
Shares issued upon conversion of debt, shares | 145,833 | ||||
Warrants issued in connection with convertible notes | 2,893 | 2,893 | |||
Beneficial conversion feature on convertible notes | 38,867 | 38,867 | |||
Net loss | (333,926) | (333,926) | |||
Balance at Jun. 30, 2019 | $ 367 | $ 1,468,825 | $ (2,753,685) | $ (1,284,494) | |
Balance, shares at Jun. 30, 2019 | 3,668,410 |
Condensed Consolidated Statem_3
Condensed Consolidated Statements of Cash Flows (Unaudited) - USD ($) | 6 Months Ended | |
Jun. 30, 2019 | Jun. 30, 2018 | |
CASH FLOWS FROM OPERATING ACTIVITIES: | ||
Net loss | $ (654,500) | $ (489,585) |
Adjustments to reconcile net loss to net cash used in operating activities: | ||
Stock-based compensation | 136,262 | 117,059 |
Amortization of debt discount to interest expense | 159,366 | 53,833 |
Bad debt recovery | (4,176) | |
Change in operating assets and liabilities: | ||
Financing leases receivable | 39,864 | 28,679 |
Due from lease service provider | (495) | 1,316 |
Prepaid expenses | 1,721 | (3,287) |
Accounts payable | 93,382 | 78,619 |
Accrued interest payable | 44,755 | 94 |
Accrued interest payable - related parties | 2,395 | 3,012 |
Accrued expenses | 57,568 | 67,329 |
NET CASH USED IN OPERATING ACTIVITIES | (119,682) | (147,107) |
CASH FLOWS FROM INVESTING ACTIVITIES: | ||
Proceeds from sale of equipment held for sale | 15,000 | |
NET CASH PROVIDED BY INVESTING ACTIVITIES | 15,000 | |
CASH FLOWS FROM FINANCING ACTIVITIES: | ||
Proceeds from line of credit - related party | 35,000 | |
Proceeds from note payable subscription receivable | 50,000 | |
Proceeds from notes payable - related parties | (2,500) | |
Proceeds from convertible notes | 113,000 | 50,000 |
NET CASH PROVIDED BY FINANCING ACTIVITIES | 110,500 | 135,000 |
NET INCREASE (DECREASE) IN CASH | (9,182) | 2,893 |
CASH, beginning of period | 10,357 | 728 |
CASH, end of period | 1,175 | 3,621 |
SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION | ||
Interest paid | 16,198 | 27,096 |
Income taxes paid | ||
SUPPLEMENTAL DISCLOSURE OF NON-CASH INVESTING AND FINANCING ACTIVITIES: | ||
Increase in debt discount for warrants | 16,427 | |
Shares issued upon conversion of debt | 11,700 | |
Beneficial conversion feature on convertible notes | 96,139 | |
Issuance of common stock for services | 77,000 | |
Reclassification of due to related party to line of credit - related party | $ 15,000 |
Organization and Nature of Oper
Organization and Nature of Operations | 6 Months Ended |
Jun. 30, 2019 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
ORGANIZATION AND NATURE OF OPERATIONS | NOTE 1 – ORGANIZATION AND NATURE OF OPERATIONS Organization Arista Financial Corp. (the “Company”) was incorporated in Nevada on December 15, 2009. Effective February 21, 2012, the Company filed with the State of Nevada a Certificate of Amendment to the Articles of Incorporation changing the Company’s name from Hunt for Travel, Inc. to Praco Corporation (“Praco”) and on January 2, 2018, the Company changed its name to Arista Financial Corp. On April 19, 2017, the Company entered into the Share Exchange Agreement with Arista Capital Ltd. (“Arista Capital”), a Nevada corporation formed on June 10, 2014, and the Arista Capital Shareholders (the “Share Exchange Agreement”). Under generally accepted accounting principles, the acquisition by the Company of Arista Capital is considered to be a capital transaction in substance, rather than a business combination. That is, the acquisition is equivalent to the acquisition by Arista Capital of the Company with the issuance of stock by Arista Capital for the net assets of the Company. This transaction is reflected as a recapitalization and is accounted for as a change in capital structure. Accordingly, the accounting for the acquisition is identical to that resulting from a reverse acquisition. Under reverse merger accounting, the comparative historical financial statements of the Company, as the legal acquirer, are those of the accounting acquirer, Arista Capital. Accordingly, the Company’s financial statements prior to the closing of the reverse acquisition, reflect only the business of Arista Capital. The Company is a finance company that provides financing to other small finance companies that do not have significant access to the capital markets. Typically, the Company does this by acquiring lease portfolios from such lenders at a purchase price that yields the Company an annual return and these lenders continue to service the portfolios purchased by the Company. The Company is currently focused on leases for trucks and construction equipment. |
Going Concern Analysis and Mana
Going Concern Analysis and Management Plans | 6 Months Ended |
Jun. 30, 2019 | |
Going Concern Analysis and Management Plans [Abstract] | |
GOING CONCERN ANALYSIS AND MANAGEMENT PLANS | NOTE 2 – GOING CONCERN ANALYSIS AND MANAGEMENT PLANS These condensed consolidated financial statements have been prepared on a going concern basis, which contemplates the realization of assets and the settlement of liabilities and commitments in the normal course of business. As reflected in our accompanying condensed consolidated financial statements, for the six months ended June 30, 2019, the Company had a net loss of $654,500 and used cash in operating activities of $119,682. Additionally, the Company had an accumulated deficit of $2,753,686, a stockholders' deficit of $1,284,494, and a working capital deficit of $1,023,721 at June 30, 2019, and minimal revenues for the six months ended June 30, 2019. Management believes that these matters raise substantial doubt about the Company's ability to continue as a going concern for twelve months from the issuance date of this report. Management cannot provide assurance that the Company will ultimately achieve profitable operations or become cash flow positive or raise additional debt and/or equity capital. Management believes that its capital resources are not currently adequate to continue operating and maintaining its business strategy for a period of twelve months from the issuance date of this report. Although the Company has historically raised capital from the issuance of promissory notes, there is no assurance that it will be able to continue to do so. Management believes that its ability to attract debt and equity financing in the capital markets is enhanced as a public reporting company. If the Company is unable to raise additional capital or secure additional lending in the near future, management expects that the Company will need to curtail or cease operations. These condensed consolidated financial statements do not include any adjustments related to the recoverability and classification of recorded asset amounts and classification of liabilities that might be necessary should the Company be unable to continue as a going concern. |
Summary of Significant Accounti
Summary of Significant Accounting Policies | 6 Months Ended |
Jun. 30, 2019 | |
Accounting Policies [Abstract] | |
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | NOTE 3 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES The management of the Company is responsible for the selection and use of appropriate accounting policies and their application. Critical accounting policies and practices are those that are both most important to the portrayal of the Company's financial condition and results and require management's most difficult, subjective, or complex judgments, often as a result of the need to make estimates about the effects of matters that are inherently uncertain. The Company's significant and critical accounting policies and practices are disclosed below as required by generally accepted accounting principles. Basis of presentation The Company prepares its condensed consolidated financial statements in conformity with accounting principles generally accepted in the United States ("U.S. GAAP") and include the accounts of the Company and its wholly-owned subsidiary. All intercompany balances and transactions have been eliminated upon consolidation. Use of estimates The preparation of 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 and disclosure of contingent assets and liabilities at the date of the condensed consolidated financial statements and the reported amounts of revenue and expenses during the reporting period. Actual results could differ from those estimates. Significant estimates for the six months ended June 30, 2019 include estimates of allowances for uncollectible finance leases receivable, the useful life of property and equipment, and the fair value of non-cash equity transactions. Credit risk and concentrations The Company maintains its cash in bank and financial institution deposits that at times may exceed federally insured limits. At June 30, 2019 and December 31, 2018, cash in bank did not exceed federally insured limits. The Company has not experienced any losses in such accounts through June 30, 2019. Financing leases receivable represent amounts due from lessees in various industries, related to equipment on direct financing leases. Currently, the Company relies on one source to acquire financing leases and to service such leases. The Company believes that other lenders are available to acquire lease portfolios if the Company cannot acquire additional financing lease receivable portfolios from its single source. Additionally, as of June 30, 2019, the Company's portfolio of financing leases consists of seven leases. A default on or loss of any of these leases would have a material adverse effect on the Company's results of operations and financial condition. Cash and cash equivalent For purposes of the statements of cash flows, the Company considers all highly liquid instruments with a maturity of three months or less at the purchase date and money market accounts to be cash equivalents. At June 30, 2019 and December 31, 2018, the Company did not have any cash equivalents. Financing leases receivable Financing leases receivable are recorded at the aggregate future minimum lease payments, estimated unguaranteed residual value of the leased equipment less unearned income. Residual values, which are reviewed periodically, represent the estimated amount the Company expects to receive at lease termination from the disposition of the leased equipment. Actual residual values realized could differ from these estimates. The unearned income is recognized in revenues in the statements of operations over the lease term, in a manner that produces a constant rate of return on the lease. Financing leases receivable due after twelve months from the balance sheet date are reflected as a long-term asset. Financing leases receivables are periodically evaluated based on individual creditworthiness of customers. Based on this evaluation, the Company records allowance for estimated losses on these receivables. Impairment of long-lived assets In accordance with ASC Topic 360, the Company reviews long-lived assets for impairment whenever events or changes in circumstances indicate that the carrying amount of the assets may not be fully recoverable, or at least annually. The Company recognizes an impairment loss when the sum of expected undiscounted future cash flows is less than the carrying amount of the asset. The amount of impairment is measured as the difference between the asset's estimated fair value and its book value. Fair value of financial instruments and fair value measurements The Company follows ASC 820-10 of the FASB Accounting Standards Codification to measure the fair value of its financial instruments and disclosures about fair value of its financial instruments. ASC 820-10 establishes a framework for measuring fair value in accounting principles generally accepted in the United States of America (U.S. GAAP), and expands disclosures about fair value measurements. To increase consistency and comparability in fair value measurements and related disclosures, ASC 820-10 establishes a fair value hierarchy which prioritizes the inputs to valuation techniques used to measure fair value into three (3) broad levels. The three (3) levels of fair value hierarchy defined by ASC 820-10 are described below: Level 1 Quoted market prices available in active markets for identical assets or liabilities as of the reporting date. Level 2 Pricing inputs other than quoted prices in active markets included in Level 1, which are either directly or indirectly observable as of the reporting date. Level 3 Pricing inputs that are generally unobservable inputs and not corroborated by market data. Financial assets are considered Level 3 when their fair values are determined using pricing models, discounted cash flow methodologies or similar techniques and at least one significant model assumption or input is unobservable. The fair value hierarchy gives the highest priority to quoted prices (unadjusted) in active markets for identical assets or liabilities and the lowest priority to unobservable inputs. If the inputs used to measure the financial assets and liabilities fall within more than one level described above, the categorization is based on the lowest level input that is significant to the fair value measurement of the instrument. The carrying amounts reported in the consolidated balance sheets for cash, financing lease receivables, due from lease service provider, accrued interest receivables, prepaid expenses, notes payable, accounts payable, accrued expenses, accrued interest payable and amounts due to related party approximate their fair market value based on the short-term maturity of these instruments. The Company does not account for any instruments at fair value using level 3 valuation. ASC 825-10 " Financial Instruments , Revenue recognition Income from direct financing lease transactions is reported using the financing method of accounting, in which the Company's investment in the leased property is reported as a receivable from the lessee to be recovered through future rentals. The interest income portion of each rental payment is calculated so as to generate a constant rate of return on the net receivable outstanding. Allowances for losses on direct financing leases are typically established based on historical charge-off and collection experience and the collectability of specifically identified lessees and billed and unbilled receivables. Direct financing leases are charged off to the allowance as they are deemed uncollectible. Direct financing leases are generally placed in a nonaccrual status (i.e., no revenue is recognized) and deemed impaired when payments are more than 90 days past due. Additionally, management periodically reviews the creditworthiness of all direct finance lessees with payments outstanding less than 90 days. Based upon management's judgment, the related direct financing leases may be placed on nonaccrual status. Leases placed on nonaccrual status are only returned to an accrual status when the account has been brought current and management believes recovery of the remaining unpaid lease payments is probable. Until such time, all payments received are applied only against outstanding principal balances. Stock-based compensation Stock-based compensation is accounted for based on the requirements of the Share-Based Payment Topic of ASC 718 which requires recognition in the financial statements of the cost of employee and director services received in exchange for an award of equity instruments over the period the employee or director is required to perform the services in exchange for the award (presumptively, the vesting period). The ASC also requires measurement of the cost of employee and director services received in exchange for an award based on the grant-date fair value of the award. Through March 31, 2018, pursuant to ASC 505-50 – "Equity-Based Payments to Non-Employees" Improvements to Nonemployee Share-Based Payment Accounting, Basic and diluted loss per share Pursuant to ASC 260-10-45, basic loss per common share is computed by dividing net loss by the weighted average number of shares of common stock outstanding for the periods presented. Diluted loss per share is computed by dividing net loss by the weighted average number of shares of common stock, common stock equivalents and potentially dilutive securities outstanding during the period. Potentially dilutive common shares consist of common stock issuable for stock warrants (using the treasury stock method) and common shares issuable upon the conversion of convertible notes payable (using the as-if converted method). These common stock equivalents may be dilutive in the future. All potentially dilutive common shares were excluded from the computation of diluted shares outstanding as they would have an anti-dilutive impact on the Company's net losses and consisted of the following: June 30, June 30, Stock warrants 1,395,909 1,293,749 Stock options 300,000 300,000 Convertible debt 703,585 200,000 2,399,494 1,793,749 Related parties Parties are considered to be related to the Company if the parties, directly or indirectly, through one or more intermediaries, control, are controlled by, or are under common control with the Company. Related parties also include principal owners of the Company, its management, members of the immediate families of principal owners of the Company and its management and other parties with which the Company may deal with if one party controls or can significantly influence the management or operating policies of the other to an extent that one of the transacting parties might be prevented from fully pursuing its own separate interests. Recent accounting pronouncements In May 2014, FASB issued an update ("ASU 2014-09") establishing Accounting Standards Codification ("ASC") Topic 606, Revenue from Contracts with Customers In February 2016, the FASB issued ASU 2016-02, "Leases" In October 2016, the FASB issued ASU 2016-16, "Income Taxes (Topic 740): Intra-Entity Transfers of Assets Other than Inventory", In June 2018, the FASB issued Accounting Standards Update 2018-07, "Compensation – Stock Compensation (Topic 718): Improvements to Nonemployee Share-Based Payment Accounting ("ASU 2018-07")". Revenue from Contracts with In August 2018, the FASB issued Accounting Standards Update (ASU) 2018-13, "Fair Value Measurement (Topic 820): Disclosure Framework - Changes to the Disclosure Requirements for Fair Value Measurement", Management does not believe that any other recently issued, but not yet effective accounting pronouncements, if adopted, would have a material effect on the accompanying condensed consolidated financial statements. |
Financing Leases Receivable
Financing Leases Receivable | 6 Months Ended |
Jun. 30, 2019 | |
Leases [Abstract] | |
FINANCING LEASES RECEIVABLE | NOTE 3 – FINANCING LEASES RECEIVABLE The seller is responsible for administrating the leases, collecting all payments, and distributing funds to the Company. On a monthly basis, the Company shall pay the seller an administrative fee equal to 2% of the scheduled payment amount of each lease, 50% of all penalties or late fee charges collected, and 50% of all default interest collected. The seller shall remit the remaining amount received from the lessees to the Company. The finance leases require 36 monthly/weekly or bi-weekly payments through April 2020. Each lease is secured by ownership of the related transportation equipment. At June 30, 2019 and December 31, 2018, financing leases receivable consisted of the following: June 30, December 31, Total minimum financing leases receivable $ 46,975 $ 96,505 Unearned income (2,298 ) (8,124 ) Total financing leases receivable 44,677 88,381 Less: allowance for uncollectible financing leases receivable (6,455 ) (10,295 ) Financing leases receivable, net 38,222 78,086 Less: current portion of financing leases receivable, net (37,160 ) (61,655 ) Financing leases receivable, net – long-term $ 1,062 $ 16,431 For the six months ended June 30, 2019 and 2018, activities in the Company's allowance for uncollectible financing leases receivable were are follows: For the Six Months Ended 2019 2018 Allowance for uncollectible financing leases receivable at beginning of period $ 10,295 $ 25,405 Provisions for credit losses - Bad debt recovery (3,840 ) (8,213 ) Allowance for uncollectible financing leases receivable at end of period $ 6,455 $ 17,192 At June 30, 2019, the aggregate amounts of future minimum gross lease payments receivable are as follows: Amount Year 1 $ 45,913 Year 2 1,062 Future minimum gross financing leases receivable $ 46,975 |
Convertible Debt
Convertible Debt | 6 Months Ended |
Jun. 30, 2019 | |
Debt Disclosure [Abstract] | |
CONVERTIBLE DEBT | NOTE 4 – CONVERTIBLE DEBT On January 28, 2019, the Company issued a convertible note to a third-party lender totaling $35,000 (the "January 2019 Note"). The company received cash of $31,500, original issue discounts of $2,100 and debt issuances costs of $1,400. The January 2019 Note accrues interest at 12% per annum and matures with interest and principal both due on October 28, 2019. The January 2019 Note is convertible into the Company's common stock at a rate of 60% discount to the Company's common stock with a lookback of 20 trading days. The conversion feature of the January 2019 Note provides for an effective conversion price that is below market value on the date of issuance. Such feature is normally characterized as a beneficial conversion feature ("BCF"). When the Company records a BCF the relative fair value of the BCF is recorded as a debt discount against the face amount of the respective debt instrument. The Company recorded a BCF of $25,985. The total discounts on the note is $28,085. The total issuances costs are $1,400. The debt discount and debt issuances costs are being accreted over the life of the note to interest expense. On February 11, 2019, the Company issued a convertible note to a third-party lender totaling $35,000 (the "February 2019 Note"). The company received cash of $31,500, original issue discounts of $2,100 and debt issuances costs of $1,400. The February 2019 Note accrues interest at 12% per annum and matures with interest and principal both due on November 6, 2019. The February 2019 Note is convertible into the Company's common stock at a rate of 60% discount to the Company's common stock with a lookback of 20 trading days. In addition, the Company issued a warrant to purchase 20,250 shares of Company common stock. The warrant entitles the holder to purchase the Company's common stock at a purchase price of $2.00 per share for a period of three years from the issue date. The Company recorded a $13,534 debt discount relating to the warrants issued to the investor based on the relative fair value of each equity instrument on the dates of issuance. The conversion feature of the February 2019 Note provides for an effective conversion price that is below market value on the date of issuance. Such feature is normally characterized as a beneficial conversion feature ("BCF"). When the Company records a BCF the relative fair value of the BCF is recorded as a debt discount against the face amount of the respective debt instrument. The Company recorded a BCF of $31,288. The total discounts on the note is $46,922. The total issuances costs are $1,400. Due to the fact the total discounts exceeded the face value of the note $16,822 were expensed to interest expense upon issuance. The debt discount and debt issuances costs are being accreted over the life of the note to interest expense. On April 1, 2019, the Company issued a convertible note to a third-party lender totaling $58,300 (the "April 2019 Note"). The company received cash of $50,000, original issue discounts of $5,300 and debt issuances costs of $3,000. The April 2019 Note accrues interest at 10% per annum and matures with interest and principal both due on March 28, 2020. The April 2019 Note is convertible into the Company's common stock at a rate of 60% discount to the Company's common stock with a lookback of 25 trading days. In addition, the Company issued a warrant to purchase 11,660 shares of Company common stock. The warrant entitles the holder to purchase the Company's common stock at a purchase price of $2.00 per share for a period of three years from the issue date. The Company recorded a $2,893 debt discount relating to the warrants issued to the investor based on the relative fair value of each equity instrument on the dates of issuance. The conversion feature of the April 2019 Note provides for an effective conversion price that is below market value on the date of issuance. Such feature is normally characterized as a beneficial conversion feature ("BCF"). When the Company records a BCF the relative fair value of the BCF is recorded as a debt discount against the face amount of the respective debt instrument. The Company recorded a BCF of $38,867. The total discounts on the note is $ 47,059. The total issuances costs are $3,000. The debt discount and debt issuances costs are being accreted over the life of the note to interest expense. During the six months ended June 30, 2019 the lenders converted $11,700 in principal into 151,327 shares of the Company's common stock. For the six months ended June 30, 2019 and 2018, amortization of debt discount related to these convertible notes amounted to $157,085 and $23,225, respectively, which has been included in interest expense on the accompanying condensed consolidated statements of operations. As of June 30, 2019 and December 31, 2018, accrued interest payable amounted to $57,922 and $34,933, respectively. The weighted average interest rate for the six months ended June 30, 2019 and December 31, 2018 was approximately 10% and 10%, respectively. At June 30, 2019 and December 31, 2018, the convertible debt consisted of the following: June 30, December 31, Principal amount $ 744,600 $ 628,000 Less: unamortized debt issuance costs (3,519 ) - Less: unamortized debt discount (13,807 ) (148,826 ) 627,274 479,174 Less: Current Debt (409,688 ) - Convertible note payable, net – long-term $ 217,587 $ 479,174 At June 30, 2019, future debt maturities are $494,600 through June 30, 2020 and $250,000 thereafter. |
Related Party Transactions
Related Party Transactions | 6 Months Ended |
Jun. 30, 2019 | |
Related Party Transactions [Abstract] | |
RELATED PARTY TRANSACTIONS | NOTE 5 – RELATED PARTY TRANSACTIONS Notes payable – related parties At June 30, 2019 and December 31, 2018, notes payable – related parties consisted of the following: June 30, December 31, Principal amount $ 10,000 $ 12,500 Less: unamortized debt discount - - Notes payable – related parties, net $ 10,000 $ 12,500 During the six months ended the Company repaid $2,500 in principal and $733 in accrued and unpaid interest. As of June 30, 2019 and December 31, 2018, accrued interest payable amounted to $501 and $544, respectively. Line of credit – related party As of June 30, 2019 and December 31, 2018, the line of credit related party amounted to $70,000. As of June 30, 2019 and December 31, 2018, accrued interest payable related party amounted to $5,508 and $2,842, respectively. Office rent - related party The Company rents its office space from a Director of the Company on a month-to-month basis for $445 per month. For the six months ended June 30, 2019 and 2018, rent expense – related party amounted to $6,750 and $ 4,500, respectively, and is included in general and administrative expenses on the accompanying statements of operations. |
Redeemable Series A Preferred
Redeemable Series A Preferred | 6 Months Ended |
Jun. 30, 2019 | |
Redeemable Series A Preferred [Abstract] | |
REDEEMABLE SERIES A PREFERRED | NOTE 6 – REDEEMABLE SERIES A PREFERRED Preferred Stock The Company has 10,000,000 shares of preferred stock authorized. Preferred stock may be issued in one or more series. The Company's board of directors is authorized to issue the shares of preferred stock in such series and to fix from time to time before issuance thereof the number of shares to be included in any such series and the designation, powers, preferences and relative, participating, optional or other rights, and the qualifications, limitations or restrictions thereof, of such series. On September 4, 2018, the Company filed a Certificate of Designation with the Secretary of State of Nevada (the "Certificate of Designation") designating 51 shares of its authorized preferred stock as Series A Super Voting Preferred Stock ("Series A Preferred"). The shares of Series A Preferred have a par value of $0.0001 per share. The Series A Preferred is not entitled to receive any dividends or liquidation preference and is not convertible into shares of the Company's common stock. The holders of the Series A Preferred shall in the aggregate have a voting power equal to 51% of the total votes of all of the outstanding common and preferred stock of the Company entitled to vote. Accordingly, each share of Series A Preferred shall have voting rights equal to (x) 0.019607 multiplied by the total issued and outstanding shares of common stock and preferred stock eligible to vote on a matter (the "Numerator") divided by (y) 0.49, minus (z) the Numerator. For example, if the total issued and outstanding shares of common stock and preferred stock equal 5,000,000 shares, then the voting rights of one share of the Series A Preferred shall be equal to 102,036 ((5,000,000 x 0.019607) / 0.49) – (5,000,000 x 0.019607). With respect to all matters upon which stockholders are entitled to vote or give consent, the holders of the outstanding shares of Series A Preferred shall vote with the holders of the common stock and any outstanding preferred stock without regard to class, except as to those matters on which separate class voting is required by applicable law or the Company's Articles of Incorporation or Bylaws. The holders of a majority of the outstanding Series A Preferred may require the Company to redeem all of the outstanding shares of Series A Preferred at any time at a redemption price of $1,000 per share. In addition, the Series A Preferred shall be automatically, and without required action by the Company or the holders thereof, be redeemed by the Company at $1,000 per share on the date that Paul Patrizio ceases, for any reason, to serve as an officer, director or consultant of the Company, it being understand that if Mr. Patrizio continues without interruption to serve in at least one such capacity, this shall not be considered a cessation of service. As of June 30, 2019 and December 31, 2018 the Company had 51 shares of Series A Preferred issued and outstanding with a stated valued of $51,000. |
Stockholders' Deficit
Stockholders' Deficit | 6 Months Ended |
Jun. 30, 2019 | |
Equity [Abstract] | |
STOCKHOLDERS' DEFICIT | NOTE 7 – STOCKHOLDERS' DEFICIT Common stock issued for services On February 1, 2019 the Company entered into a three-month consulting agreement for investor relations services. In connection with the consulting agreement, the Company agreed to issued 20,000 shares of its common stock on the first of each month for the next three months. The shares were valued at their fair value of $56,500 which was the fair value on the date of grant based on the closing quoted share price on the date of grant. Common stock issued for note conversion During the six months ended June 30, 2019 a lender converted $11,700 in principal into 151,327 shares of the Company's common stock. Stock options Stock option activities for the six months ended June 30, 2019 is summarized as follows: Number of Options Weighted Average Exercise Price Weighted Average Remaining Contractual Term (Years) Aggregate Intrinsic Value Balance Outstanding December 31, 2018 300,000 1.00 4.76 Granted - - - Balance Outstanding June 30, 2019 300,000 $ 1.00 3.51 $ - Exercisable, June 30, 2019 100,000 $ 1.00 3.51 $ - Warrants The Company applied fair value accounting for all share-based payments awards. The fair value of each warrant granted is estimated on the date of grant using the Black-Scholes option-pricing model. The assumptions used for warrants granted during the six months ended June 30, 2019 are as follows: June 30, 2019 Exercise price $ 2.00 Expected dividends - % Expected volatility 100 % Risk free interest rate 2.31 – 2.47 % Expected life of warrant 3 years Warrant activities for the six months ended June 30, 2019 are summarized as follows: Number of Weighted Weighted Average Balance Outstanding December 31, 2018 1,363,999 2.36 4.10 Granted in connection with debt 31,910 2.00 3.00 Balance Outstanding June 30, 2019 1,395,909 2.35 3.59 $ 34,500 Exercisable, June 30, 2019 1,395,909 2.35 3.59 $ 34,500 |
Commitments and Contincengies
Commitments and Contincengies | 6 Months Ended |
Jun. 30, 2019 | |
Commitments and Contingencies Disclosure [Abstract] | |
COMMITMENTS AND CONTINCENGIES | NOTE 8 – COMMITMENTS AND CONTINCENGIES Employment agreement On December 14, 2017 and effective on January 1, 2018 (the "Effective Date"), the Company entered into a new employment agreement with its CEO. For all services rendered by CEO pursuant to this Agreement, during the term of this Agreement the Company shall pay the CEO a salary at the following annual rates based upon the financial statements of the Company: (i) Upon the Effective Date, the CEO's base compensation shall be at the annual rate of $150,000; (ii) Thereafter; upon the first $500,000 of gross proceeds in a financing raised by the Company during the term of the Agreement the CEO's base salary compensation shall be raised to $200,000; (iii) Thereafter; upon the next $500,000 of gross proceeds in financings raised by the Company during the term of the Agreement the CEO's base salary compensation shall be raised to $250,000; (iv) Thereafter; for each additional $1,000,000 of gross proceeds in financings raised by the Company during the term of the Agreement the CEO's base salary compensation shall be increased by $12,000. The CEO's base salary shall be increased on each January 1st during the term of this Agreement by not less than five percent (5%) of the then annual compensation amount. The Company will provide the CEO with an allowance equal to $2,000 per month for health insurance with such allowance increased on each anniversary date of this Agreement at the same rate as the CEO's base compensation in addition to any amounts provided to employees generally. The CEO will earn an annual bonus as follows: nine percent (9%) of the Company's annual EBITDA (Earnings before interest expense, taxes, depreciation, and amortization and all other non-cash charges) up to the first $5,000,000 of EBITDA, then 5% on amounts thereafter, based on the audited consolidated results of the Company. This bonus shall be payable in cash within thirty days after the audit has been completed. In addition, the CEO was entitled to a transaction bonus in the amount of $20,000 payable in cash at the closing of the Share Exchange in addition to any amounts outstanding to him from Arista at that time. In addition, effective January 1, 2018, the CEO was granted options to purchase 300,000 shares of the Corporation's common stock at an exercise price of $1.00 per share which shall vest annually on a pro rata basis over the 3-year period commencing January 1, 2019. Unless earlier terminated in accordance with the terms hereof, the term of the Agreement shall be for the period commencing as of the Effective Date and ending December 31, 2022; provided, however, that on each anniversary date of the Agreement, this Agreement shall automatically be extended for successive one-year periods unless the Company or the CEO shall have given the other written notice of its or his intention to terminate this Agreement at least six months prior to the anniversary date in any such year. In the event of termination of employment by the Company pursuant to the Agreement, without cause, the Company shall continue for a period equal to the greater of (A) the balance of the term of the Agreement, or (B) two (2) years, the following: (i) the CEO's base salary at its then annual rate, and (ii) provide to the Executive the benefits. In the event of termination of the CEO's employment by the Company in the first year of the Agreement for any reason whatsoever excluding a termination with cause, the Company shall pay as severance to CEO, no later than thirty days following the date of termination, the greater of (i) 300% of the maximum allowable bonus payable to the Executive pursuant to Section 4(b); or (ii) the sum of $300,000. Future minimum commitment payments under an employment agreement at June 30, 2019 are as follows: Years ending December 31, Amount 2019 (remainder of year) $ 110,250 2020 231,525 2021 243,101 2023 255,256 Total minimum commitment employment agreement payments $ 840,133 Consulting agreements On March 1, 2018, the Company entered into a one-year consulting agreement with a third-party entity for assistance with corporate strategy, investor relations, and financial advisory and business development services. In connection with this consulting agreement, the Company paid the consultant $5,000. Upon fulfillment of the term of the agreement, the agreement shall convert to either an "at will" agreement or shall extend for an additional period of time as mutually determined by the Company and consultant. Investment agreement On July 19, 2018, the Company entered into an investment agreement with a third-party entity to invest up to $5,000,000 over a commitment period of three years by purchasing the Company's common stock under Section 4(a)(2) of the Securities Act of 1933. The third-party entity's obligation to purchase the Company's common stock is subject to the filing and effectiveness of an S-1 registration statement by the Company. |
Subsequent Events
Subsequent Events | 6 Months Ended |
Jun. 30, 2019 | |
Subsequent Events [Abstract] | |
SUBSEQUENT EVENTS | NOTE 9 – SUBSEQUENT EVENTS Subsequent to June 30, 2019, the Company entered into two convertible note agreements with investors. The Company received proceeds of $65,000. As additional consideration for entering in the convertible note agreements, the investors were granted warrants to purchase 75,000 shares of the Company's common stock. Subsequent to June 30, 2019, the Company's lenders converted a portion of the Company's outstanding convertible notes into 862,000 shares of the Company's common stock. Subsequent to June 30, 2019, the Company was served with a summons and complaint relating to a lawsuit filed by CFO Oncall, Inc. in the Circuit Court of the Seventeenth Judicial Circuit, Broward County, Florida on June 18, 2019 against the Company alleging that the Company owes the plaintiff approximately $15,000 in connection with certain consulting services provided by the plaintiff in 2018. The Company has engaged legal counsel and intends to defend itself vigorously. |
Summary of Significant Accoun_2
Summary of Significant Accounting Policies (Policies) | 6 Months Ended |
Jun. 30, 2019 | |
Accounting Policies [Abstract] | |
Basis of presentation | Basis of presentation The Company prepares its condensed consolidated financial statements in conformity with accounting principles generally accepted in the United States ("U.S. GAAP") and include the accounts of the Company and its wholly-owned subsidiary. All intercompany balances and transactions have been eliminated upon consolidation. |
Use of estimates | Use of estimates The preparation of 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 and disclosure of contingent assets and liabilities at the date of the condensed consolidated financial statements and the reported amounts of revenue and expenses during the reporting period. Actual results could differ from those estimates. Significant estimates for the six months ended June 30, 2019 include estimates of allowances for uncollectible finance leases receivable, the useful life of property and equipment, and the fair value of non-cash equity transactions. |
Credit risk and concentrations | Credit risk and concentrations The Company maintains its cash in bank and financial institution deposits that at times may exceed federally insured limits. At June 30, 2019 and December 31, 2018, cash in bank did not exceed federally insured limits. The Company has not experienced any losses in such accounts through June 30, 2019. Financing leases receivable represent amounts due from lessees in various industries, related to equipment on direct financing leases. Currently, the Company relies on one source to acquire financing leases and to service such leases. The Company believes that other lenders are available to acquire lease portfolios if the Company cannot acquire additional financing lease receivable portfolios from its single source. Additionally, as of June 30, 2019, the Company's portfolio of financing leases consists of seven leases. A default on or loss of any of these leases would have a material adverse effect on the Company's results of operations and financial condition. |
Cash and cash equivalent | Cash and cash equivalent For purposes of the statements of cash flows, the Company considers all highly liquid instruments with a maturity of three months or less at the purchase date and money market accounts to be cash equivalents. At June 30, 2019 and December 31, 2018, the Company did not have any cash equivalents. |
Financing leases receivable | Financing leases receivable Financing leases receivable are recorded at the aggregate future minimum lease payments, estimated unguaranteed residual value of the leased equipment less unearned income. Residual values, which are reviewed periodically, represent the estimated amount the Company expects to receive at lease termination from the disposition of the leased equipment. Actual residual values realized could differ from these estimates. The unearned income is recognized in revenues in the statements of operations over the lease term, in a manner that produces a constant rate of return on the lease. Financing leases receivable due after twelve months from the balance sheet date are reflected as a long-term asset. Financing leases receivables are periodically evaluated based on individual creditworthiness of customers. Based on this evaluation, the Company records allowance for estimated losses on these receivables. |
Impairment of long-lived assets | Impairment of long-lived assets In accordance with ASC Topic 360, the Company reviews long-lived assets for impairment whenever events or changes in circumstances indicate that the carrying amount of the assets may not be fully recoverable, or at least annually. The Company recognizes an impairment loss when the sum of expected undiscounted future cash flows is less than the carrying amount of the asset. The amount of impairment is measured as the difference between the asset's estimated fair value and its book value. |
Fair value of financial instruments and fair value measurements | Fair value of financial instruments and fair value measurements The Company follows ASC 820-10 of the FASB Accounting Standards Codification to measure the fair value of its financial instruments and disclosures about fair value of its financial instruments. ASC 820-10 establishes a framework for measuring fair value in accounting principles generally accepted in the United States of America (U.S. GAAP), and expands disclosures about fair value measurements. To increase consistency and comparability in fair value measurements and related disclosures, ASC 820-10 establishes a fair value hierarchy which prioritizes the inputs to valuation techniques used to measure fair value into three (3) broad levels. The three (3) levels of fair value hierarchy defined by ASC 820-10 are described below: Level 1 Quoted market prices available in active markets for identical assets or liabilities as of the reporting date. Level 2 Pricing inputs other than quoted prices in active markets included in Level 1, which are either directly or indirectly observable as of the reporting date. Level 3 Pricing inputs that are generally unobservable inputs and not corroborated by market data. Financial assets are considered Level 3 when their fair values are determined using pricing models, discounted cash flow methodologies or similar techniques and at least one significant model assumption or input is unobservable. The fair value hierarchy gives the highest priority to quoted prices (unadjusted) in active markets for identical assets or liabilities and the lowest priority to unobservable inputs. If the inputs used to measure the financial assets and liabilities fall within more than one level described above, the categorization is based on the lowest level input that is significant to the fair value measurement of the instrument. The carrying amounts reported in the consolidated balance sheets for cash, financing lease receivables, due from lease service provider, accrued interest receivables, prepaid expenses, notes payable, accounts payable, accrued expenses, accrued interest payable and amounts due to related party approximate their fair market value based on the short-term maturity of these instruments. The Company does not account for any instruments at fair value using level 3 valuation. ASC 825-10 " Financial Instruments , |
Revenue recognition | Revenue recognition Income from direct financing lease transactions is reported using the financing method of accounting, in which the Company's investment in the leased property is reported as a receivable from the lessee to be recovered through future rentals. The interest income portion of each rental payment is calculated so as to generate a constant rate of return on the net receivable outstanding. Allowances for losses on direct financing leases are typically established based on historical charge-off and collection experience and the collectability of specifically identified lessees and billed and unbilled receivables. Direct financing leases are charged off to the allowance as they are deemed uncollectible. Direct financing leases are generally placed in a nonaccrual status (i.e., no revenue is recognized) and deemed impaired when payments are more than 90 days past due. Additionally, management periodically reviews the creditworthiness of all direct finance lessees with payments outstanding less than 90 days. Based upon management's judgment, the related direct financing leases may be placed on nonaccrual status. Leases placed on nonaccrual status are only returned to an accrual status when the account has been brought current and management believes recovery of the remaining unpaid lease payments is probable. Until such time, all payments received are applied only against outstanding principal balances. |
Stock-based compensation | Stock-based compensation Stock-based compensation is accounted for based on the requirements of the Share-Based Payment Topic of ASC 718 which requires recognition in the financial statements of the cost of employee and director services received in exchange for an award of equity instruments over the period the employee or director is required to perform the services in exchange for the award (presumptively, the vesting period). The ASC also requires measurement of the cost of employee and director services received in exchange for an award based on the grant-date fair value of the award. Through March 31, 2018, pursuant to ASC 505-50 – "Equity-Based Payments to Non-Employees" Improvements to Nonemployee Share-Based Payment Accounting, |
Basic and diluted loss per share | Basic and diluted loss per share Pursuant to ASC 260-10-45, basic loss per common share is computed by dividing net loss by the weighted average number of shares of common stock outstanding for the periods presented. Diluted loss per share is computed by dividing net loss by the weighted average number of shares of common stock, common stock equivalents and potentially dilutive securities outstanding during the period. Potentially dilutive common shares consist of common stock issuable for stock warrants (using the treasury stock method) and common shares issuable upon the conversion of convertible notes payable (using the as-if converted method). These common stock equivalents may be dilutive in the future. All potentially dilutive common shares were excluded from the computation of diluted shares outstanding as they would have an anti-dilutive impact on the Company's net losses and consisted of the following: June 30, June 30, Stock warrants 1,395,909 1,293,749 Stock options 300,000 300,000 Convertible debt 703,585 200,000 2,399,494 1,793,749 |
Related parties | Related parties Parties are considered to be related to the Company if the parties, directly or indirectly, through one or more intermediaries, control, are controlled by, or are under common control with the Company. Related parties also include principal owners of the Company, its management, members of the immediate families of principal owners of the Company and its management and other parties with which the Company may deal with if one party controls or can significantly influence the management or operating policies of the other to an extent that one of the transacting parties might be prevented from fully pursuing its own separate interests. |
Recent accounting pronouncements | Recent accounting pronouncements In May 2014, FASB issued an update ("ASU 2014-09") establishing Accounting Standards Codification ("ASC") Topic 606, Revenue from Contracts with Customers In February 2016, the FASB issued ASU 2016-02, "Leases" In October 2016, the FASB issued ASU 2016-16, "Income Taxes (Topic 740): Intra-Entity Transfers of Assets Other than Inventory", In June 2018, the FASB issued Accounting Standards Update 2018-07, "Compensation – Stock Compensation (Topic 718): Improvements to Nonemployee Share-Based Payment Accounting ("ASU 2018-07")". Revenue from Contracts with In August 2018, the FASB issued Accounting Standards Update (ASU) 2018-13, "Fair Value Measurement (Topic 820): Disclosure Framework - Changes to the Disclosure Requirements for Fair Value Measurement", Management does not believe that any other recently issued, but not yet effective accounting pronouncements, if adopted, would have a material effect on the accompanying condensed consolidated financial statements. |
Summary of Significant Accoun_3
Summary of Significant Accounting Policies (Tables) | 6 Months Ended |
Jun. 30, 2019 | |
Accounting Policies [Abstract] | |
Schedule of anti-dilutive impact on net losses | June 30, June 30, Stock warrants 1,395,909 1,293,749 Stock options 300,000 300,000 Convertible debt 703,585 200,000 2,399,494 1,793,749 |
Financing Leases Receivable (Ta
Financing Leases Receivable (Tables) | 6 Months Ended |
Jun. 30, 2019 | |
Leases [Abstract] | |
Summary of financing leases receivable | June 30, December 31, Total minimum financing leases receivable $ 46,975 $ 96,505 Unearned income (2,298 ) (8,124 ) Total financing leases receivable 44,677 88,381 Less: allowance for uncollectible financing leases receivable (6,455 ) (10,295 ) Financing leases receivable, net 38,222 78,086 Less: current portion of financing leases receivable, net (37,160 ) (61,655 ) Financing leases receivable, net – long-term $ 1,062 $ 16,431 |
Summary of uncollectible financing leases receivable | For the Six Months Ended 2019 2018 Allowance for uncollectible financing leases receivable at beginning of period $ 10,295 $ 25,405 Provisions for credit losses - Bad debt recovery (3,840 ) (8,213 ) Allowance for uncollectible financing leases receivable at end of period $ 6,455 $ 17,192 |
Summary of future minimum gross lease payments receivable | Amount Year 1 $ 45,913 Year 2 1,062 Future minimum gross financing leases receivable $ 46,975 |
Convertible Debt (Tables)
Convertible Debt (Tables) | 6 Months Ended |
Jun. 30, 2019 | |
Debt Disclosure [Abstract] | |
Schedule of convertible debt | June 30, December 31, Principal amount $ 744,600 $ 628,000 Less: unamortized debt issuance costs (3,519 ) - Less: unamortized debt discount (13,807 ) (148,826 ) 627,274 479,174 Less: Current Debt (409,688 ) - Convertible note payable, net – long-term $ 217,587 $ 479,174 |
Related Party Transactions (Tab
Related Party Transactions (Tables) | 6 Months Ended |
Jun. 30, 2019 | |
Related Party Transactions [Abstract] | |
Schedule of notes payable - related parties | June 30, December 31, Principal amount $ 10,000 $ 12,500 Less: unamortized debt discount - - Notes payable – related parties, net $ 10,000 $ 12,500 |
Stockholders' Deficit (Tables)
Stockholders' Deficit (Tables) | 6 Months Ended |
Jun. 30, 2019 | |
Stockholders Deficit | |
Schedule of stock option activity | Number of Options Weighted Average Exercise Price Weighted Average Remaining Contractual Term (Years) Aggregate Intrinsic Value Balance Outstanding December 31, 2018 300,000 1.00 4.76 Granted - - - Balance Outstanding June 30, 2019 300,000 $ 1.00 3.51 $ - Exercisable, June 30, 2019 100,000 $ 1.00 3.51 $ - |
Schedule of assumptions used for warrants granted | June 30, 2019 Exercise price $ 2.00 Expected dividends - % Expected volatility 100 % Risk free interest rate 2.31 – 2.47 % Expected life of warrant 3 years |
Schedule of warrant activities | Number of Weighted Weighted Average Balance Outstanding December 31, 2018 1,363,999 2.36 4.10 Granted in connection with debt 31,910 2.00 3.00 Balance Outstanding June 30, 2019 1,395,909 2.35 3.59 $ 34,500 Exercisable, June 30, 2019 1,395,909 2.35 3.59 $ 34,500 |
Commitments and Contincengies (
Commitments and Contincengies (Tables) | 6 Months Ended |
Jun. 30, 2019 | |
Commitments and Contingencies Disclosure [Abstract] | |
Schedule of future minimum commitment payments under an employment agreement | Years ending December 31, Amount 2019 (remainder of year) $ 110,250 2020 231,525 2021 243,101 2023 255,256 Total minimum commitment employment agreement payments $ 840,133 |
Going Concern Analysis and Ma_2
Going Concern Analysis and Management Plans (Details) - USD ($) | 3 Months Ended | 6 Months Ended | |||
Jun. 30, 2019 | Jun. 30, 2018 | Jun. 30, 2019 | Jun. 30, 2018 | Dec. 31, 2018 | |
Going Concern Analysis And Management Plans (Textual) | |||||
Net loss | $ (333,926) | $ (257,831) | $ (654,500) | $ (489,585) | |
Cash used in operations activities | (119,682) | $ (147,107) | |||
Accumulated deficit | (2,753,686) | (2,753,686) | $ (2,099,185) | ||
Working capital deficit | $ 1,023,721 | $ 1,023,721 |
Summary of Significant Accoun_4
Summary of Significant Accounting Policies (Details) - shares | 6 Months Ended | |
Jun. 30, 2019 | Jun. 30, 2018 | |
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Potentially dilutive shares of common stock | 2,399,494 | 1,793,749 |
Stock warrants [Member] | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Potentially dilutive shares of common stock | 1,395,909 | 1,293,749 |
Stock options [Member] | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Potentially dilutive shares of common stock | 300,000 | 300,000 |
Convertible debt [Member] | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Potentially dilutive shares of common stock | 703,585 | 200,000 |
Financing Leases Receivable (De
Financing Leases Receivable (Details) - USD ($) | Jun. 30, 2019 | Dec. 31, 2018 |
Leases [Abstract] | ||
Total minimum financing leases receivable | $ 46,975 | $ 96,505 |
Unearned income | (2,298) | (8,124) |
Total financing leases receivable | 44,677 | 88,381 |
Less: allowance for uncollectible financing leases receivable | (6,455) | (10,295) |
Financing leases receivable, net | 38,222 | 78,086 |
Less: current portion of financing leases receivable, net | (37,160) | (61,655) |
Financing leases receivable, net - long-term | $ 1,062 | $ 16,431 |
Financing Leases Receivable (_2
Financing Leases Receivable (Details 1) - USD ($) | 6 Months Ended | |
Jun. 30, 2019 | Jun. 30, 2018 | |
Leases [Abstract] | ||
Allowance for uncollectible financing leases receivable at beginning of period | $ 10,295 | $ 25,405 |
Provisions for credit losses | ||
Bad debt recovery | (3,840) | (8,213) |
Allowance for uncollectible financing leases receivable at end of period | $ 6,455 | $ 17,192 |
Financing Leases Receivable (_3
Financing Leases Receivable (Details 2) | Jun. 30, 2019USD ($) |
Leases [Abstract] | |
Year 1 | $ 45,913 |
Year 2 | 1,062 |
Future minimum gross financing leases receivable | $ 46,975 |
Financing Leases Receivable (_4
Financing Leases Receivable (Details Textual) | 6 Months Ended |
Jun. 30, 2019 | |
Financing Leases Receivable (Textual) | |
Financing lease transaction, description | The Company shall pay the seller an administrative fee equal to 2% of the scheduled payment amount of each lease, 50% of all penalties or late fee charges collected, and 50% of all default interest collected. The seller shall remit the remaining amount received from the lessees to the Company. The finance leases require 36 monthly/weekly or bi-weekly payments through April 2020. |
Convertible Debt (Details)
Convertible Debt (Details) - Convertible Debt [Member] - USD ($) | Jun. 30, 2019 | Dec. 31, 2018 |
Extinguishment of Debt [Line Items] | ||
Principal amount | $ 744,600 | $ 628,000 |
Less: unamortized debt issuance costs | (3,519) | |
Less: unamortized debt discount | (13,807) | (148,826) |
Notes Payable Total | 627,274 | 479,174 |
Less: Current Debt | (409,688) | |
Convertible note payable, net - long-term | $ 217,587 | $ 479,174 |
Convertible Debt (Details Textu
Convertible Debt (Details Textual) - USD ($) | Apr. 03, 2019 | Feb. 11, 2019 | Jan. 28, 2019 | Jun. 30, 2019 | Jun. 30, 2018 | Jun. 30, 2019 | Jun. 30, 2018 | Apr. 02, 2019 | Dec. 31, 2018 |
Convertible Debt (Textual) | |||||||||
Interest rate | 10.00% | ||||||||
Number of value issued upon conversion | $ 9,200 | $ 90,545 | $ 11,700 | $ 90,545 | |||||
Convertible debt due, description | The lenders converted $11,700 in principal into 151,327 shares of the Company's common stock. | ||||||||
Amortization of debt discount | $ 159,366 | 53,833 | |||||||
Common stock price per share | $ 2 | ||||||||
Common stock ,values | $ 50,000 | ||||||||
Fair value of the warrants | $ 2,893 | ||||||||
Debt instrument, maturity date | Jun. 30, 2020 | ||||||||
Warrant to purchase | 11,660 | ||||||||
Common stock shares issue | $ 3,000 | $ 11,700 | |||||||
Original issue discount | 5,300 | ||||||||
Company received cash | 113,000 | 50,000 | |||||||
Debt issuances costs | $ 3,000 | ||||||||
Company recorded a BCF | 38,867 | $ 96,139 | |||||||
Conversion amount | 58,300 | ||||||||
Conversion Shares | 862,000 | ||||||||
Interest expense | 96,272 | $ 31,313 | $ 218,087 | 62,816 | |||||
Debt discount relating to warrant | $ 2,893 | ||||||||
January 2019 Note [Member] | |||||||||
Convertible Debt (Textual) | |||||||||
Convertible debt conversion, percentage | 60.00% | ||||||||
Aggregate amount | $ 35,000 | ||||||||
Interest rate | 12.00% | ||||||||
Debt instrument, maturity date | Oct. 28, 2019 | ||||||||
Original issue discount | $ 2,100 | 28,085 | |||||||
Company received cash | 31,500 | ||||||||
Debt issuances costs | $ 1,400 | ||||||||
Company recorded a BCF | 25,985 | ||||||||
Conversion amount | 2,500 | ||||||||
February 2019 Note [Member] | |||||||||
Convertible Debt (Textual) | |||||||||
Convertible debt conversion, percentage | 60.00% | ||||||||
Aggregate amount | $ 35,000 | ||||||||
Interest rate | 12.00% | ||||||||
Amortization of debt discount | $ 13,534 | $ 23,225 | |||||||
Interest payable | $ 57,922 | $ 57,922 | $ 34,933 | ||||||
Weighted average interest rate | 10.00% | 10.00% | 10.00% | ||||||
Debt maturities in 2019 | $ 494,600 | $ 494,600 | $ 250,000 | ||||||
Common stock price per share | $ 2 | ||||||||
Debt instrument, maturity date | Nov. 6, 2019 | ||||||||
Warrant to purchase | 20,250 | ||||||||
Original issue discount | $ 2,100 | 46,922 | |||||||
Company received cash | 31,500 | ||||||||
Debt issuances costs | $ 1,400 | ||||||||
Company recorded a BCF | 31,288 | ||||||||
Interest expense | 46,922 | ||||||||
April 2019 Note [Member] | |||||||||
Convertible Debt (Textual) | |||||||||
Amortization of debt discount | 157,085 | ||||||||
Original issue discount | 47,059 | ||||||||
Company recorded a BCF | $ 38,867 |
Related Party Transactions (Det
Related Party Transactions (Details) - USD ($) | Jun. 30, 2019 | Dec. 31, 2018 |
Related Party Transaction [Line Items] | ||
Notes payable - related parties, net | $ 10,000 | $ 12,500 |
Notes Payable Related Parties [Member] | ||
Related Party Transaction [Line Items] | ||
Principal amount | 10,000 | 12,500 |
Less: unamortized debt discount | ||
Notes payable - related parties, net | $ 10,000 | $ 12,500 |
Related Party Transactions (D_2
Related Party Transactions (Details Textual) - USD ($) | 6 Months Ended | 12 Months Ended | |
Jun. 30, 2019 | Jun. 30, 2018 | Dec. 31, 2018 | |
Related Party Transactions (Textual) | |||
Office rent - related party, description | The Company rents its office space from a Director of the Company on a month-to-month basis for $445 per month. | ||
Rent expense - related party | $ 6,750 | $ 4,500 | |
Line of credit - related party | 70,000 | $ 70,000 | |
Accrued interest payable | 57,922 | 13,167 | |
accrued unpaid interest | 2,500 | 733 | |
Notes Payable Related Parties [Member] | |||
Related Party Transactions (Textual) | |||
Principal amount | 10,000 | 12,500 | |
Accrued interest payable - related parties | $ 5,508 | $ 2,842 |
Redeemable Series A Preferred (
Redeemable Series A Preferred (Details) - USD ($) | Sep. 04, 2018 | Jun. 30, 2019 | Dec. 31, 2018 |
Redeemable Series A Preferred Textual [Abstract] | |||
Preferred stock, par value | $ 0.0001 | $ 0.0001 | |
Preferred stock, shares authorized | 10,000,000 | 10,000,000 | |
Redemption price per share | $ 1,000 | ||
Redeemable preferred stock stated value | $ 51,000 | $ 51,000 | |
Series A Preferred Stock [Member] | |||
Redeemable Series A Preferred Textual [Abstract] | |||
Preferred stock, par value | $ 0.0001 | ||
Preferred stock, shares authorized | 51 | 51 | 51 |
Preferred stock voting rights | The holders of the Series A Preferred shall in the aggregate have a voting power equal to 51% of the total votes of all of the outstanding common and preferred stock of the Company entitled to vote. Accordingly, each share of Series A Preferred shall have voting rights equal to (x) 0.019607 multiplied by the total issued and outstanding shares of common stock and preferred stock eligible to vote on a matter (the "Numerator") divided by (y) 0.49, minus (z) the Numerator. For example, if the total issued and outstanding shares of common stock and preferred stock equal 5,000,000 shares, then the voting rights of one share of the Series A Preferred shall be equal to 102,036 ((5,000,000 x 0.019607) / 0.49) ? (5,000,000 x 0.019607). With respect to all matters upon which stockholders are entitled to vote or give consent, the holders of the outstanding shares of Series A Preferred shall vote with the holders of the common stock and any outstanding preferred stock without regard to class, except as to those matters on which separate class voting is required by applicable law or the Company's Articles of Incorporation or Bylaws. | ||
Redemption price per share | $ 1,000 |
Stockholders' Deficit (Details)
Stockholders' Deficit (Details) | 6 Months Ended |
Jun. 30, 2019USD ($)$ / sharesshares | |
Warrant [Member] | |
Number of Warrants/Options | |
Balance Outstanding December 31, 2018 | 1,363,999 |
Granted in connection with debt | 31,910 |
Balance Outstanding June 30, 2019 | 1,395,909 |
Exercisable, June 30, 2019 | 1,395,909 |
Weighted Average Exercise Price | |
Balance Outstanding December 31, 2018 | $ / shares | $ 2.36 |
Granted | $ / shares | 2 |
Balance Outstanding June 30, 2019 | $ / shares | 2.35 |
Exercisable, June 30, 2019 | $ / shares | $ 2.35 |
Weighted Average Remaining Contractual Term (Years) | |
Balance Outstanding December 31, 2018 | 4 years 1 month 6 days |
Granted in connection with debt | 3 years 7 months 2 days |
Average Intrinsic Value | |
Balance Outstanding June 30, 2019 | $ | $ 34,500 |
Exercisable, June 30, 2019 | $ | $ 34,500 |
Stock Option [Member] | |
Number of Warrants/Options | |
Balance Outstanding December 31, 2018 | 300,000 |
Granted | |
Balance Outstanding June 30, 2019 | 300,000 |
Weighted Average Exercise Price | |
Balance Outstanding June 30, 2019 | $ / shares | $ 1 |
Exercisable, June 30, 2019 | $ / shares | $ 1 |
Weighted Average Remaining Contractual Term (Years) | |
Balance Outstanding December 31, 2018 | 4 years 9 months 3 days |
Granted in connection with debt | 3 years |
Balance Outstanding June 30, 2019 | 3 years 6 months 3 days |
Exercisable, June 30, 2019 | 3 years 6 months 3 days |
Average Intrinsic Value | |
Balance Outstanding June 30, 2019 | $ | |
Exercisable, June 30, 2019 | $ |
Stockholders' Deficit (Details
Stockholders' Deficit (Details 1) | 6 Months Ended |
Jun. 30, 2019$ / shares | |
Exercise price | $ 2 |
Expected dividends | |
Expected volatility | 100.00% |
Expected life of warrant | 3 years |
Minimum [Member] | |
Risk free interest rate | 2.31% |
Maximum [Member] | |
Risk free interest rate | 2.47% |
Stockholders' Deficit (Detail_2
Stockholders' Deficit (Details Textual) - USD ($) | Feb. 01, 2019 | Jun. 30, 2019 | Jun. 30, 2018 | Jun. 30, 2019 | Jun. 30, 2018 | Dec. 31, 2018 |
Stockholders' Deficit (Textual) | ||||||
Preferred stock, shares authorized | 10,000,000 | 10,000,000 | 10,000,000 | |||
Preferred stock, par value | $ 0.0001 | $ 0.0001 | $ 0.0001 | |||
Fair value of shares issued | $ 56,500 | $ 48,136 | $ 42,405 | $ 136,263 | $ 145,810 | |
Common stock, shares issued | 3,668,410 | 3,668,410 | 3,433,083 | |||
Common stock, per share | $ 0.0001 | $ 0.0001 | $ 0.0001 | |||
Common Stock [Member] | ||||||
Stockholders' Deficit (Textual) | ||||||
Number of common stock issued for services | 20,000 | 32,000 | 10,000 | 84,000 | 70,000 | |
Fair value of shares issued | $ 3 | $ 1 | $ 9 | $ 7 |
Commitments and Contincengies_2
Commitments and Contincengies (Details) | Jun. 30, 2019USD ($) |
Commitments and Contingencies Disclosure [Abstract] | |
2019 (remainder of year) | $ 110,250 |
2020 | 231,525 |
2021 | 243,101 |
2023 | 255,256 |
Total minimum commitment employment agreement payments | $ 840,133 |
Commitments and Contincengies_3
Commitments and Contincengies (Details Textual) - USD ($) | Dec. 14, 2017 | Jan. 02, 2019 | Jul. 19, 2018 | Mar. 01, 2018 |
Commitments and Contincengies (Textual) | ||||
Other commitments, description | The Company entered into an investment agreement with a third-party entity to invest up to $5,000,000 over a commitment period of three years by purchasing the Company's common stock. | |||
Paid to consultant | $ 5,000 | |||
Chief Executive Officer [Member] | ||||
Commitments and Contincengies (Textual) | ||||
Other commitments, description | The CEO will earn an annual bonus as follows: nine percent (9%) of the Company's annual EBITDA (Earnings before interest expense, taxes, depreciation, and amortization and all other non-cash charges) up to the first $5,000,000 of EBITDA, then 5% on amounts thereafter, based on the audited consolidated results of the Company. | |||
Bonus payable agreement, description | The Company shall pay as severance to CEO, no later than thirty days following the date of termination, the greater of (i) 300% of the maximum allowable bonus payable to the Executive pursuant to Section 4(b); or (ii) the sum of $300,000. | The CEO was granted options to purchase 300,000 shares of the Corporation's common stock at an exercise price of $1.00 per share which shall vest annually on a pro rata basis over the 3-year period commencing January 1, 2019. | ||
Amount of bonus transaction | $ 20,000 | |||
Health insurance | $ 2,000 | |||
Chief Executive Officer [Member] | Employment agreement [Member] | ||||
Commitments and Contincengies (Textual) | ||||
Agreement of annual salary, description | (i) Upon the Effective Date, the CEO's base compensation shall be at the annual rate of $150,000; (ii) Thereafter; upon the first $500,000 of gross proceeds in a financing raised by the Company during the term of the Agreement the CEO's base salary compensation shall be raised to $200,000; (iii) Thereafter; upon the next $500,000 of gross proceeds in financings raised by the Company during the term of the Agreement the CEO's base salary compensation shall be raised to $250,000; (iv) Thereafter; for each additional $1,000,000 of gross proceeds in financings raised by the Company during the term of the Agreement the CEO's base salary compensation shall be increased by $12,000. |
Subsequent Events (Details)
Subsequent Events (Details) - USD ($) | Aug. 15, 2019 | Jun. 30, 2019 | Jun. 30, 2018 |
Subsequent Events (Textual) | |||
Subsequent event, description | The Company was served with a summons and complaint relating to a lawsuit filed by CFO Oncall, Inc. in the Circuit Court of the Seventeenth Judicial Circuit, Broward County, Florida on June 18, 2019 against the Company alleging that the Company owes the plaintiff approximately $15,000 in connection with certain consulting services provided by the plaintiff in 2018. The Company has engaged legal counsel and intends to defend itself vigorously. | ||
Proceeds from convertible debt | $ 113,000 | $ 50,000 | |
Outstanding convertible notes into shares | 862,000 | ||
Two Convertible Note Agreement [Member] | |||
Subsequent Events (Textual) | |||
Proceeds from convertible debt | $ 65,000 | ||
Granted warrants to purchase shares | 75,000 | ||
Two Convertible Note Agreement [Member] | Subsequent Event [Member] | |||
Subsequent Events (Textual) | |||
Granted warrants to purchase shares | 128,048 |