Document and Entity Information
Document and Entity Information - shares | 9 Months Ended | |
Sep. 30, 2020 | Nov. 03, 2020 | |
Cover [Abstract] | ||
Entity Registrant Name | WYTEC INTERNATIONAL INC | |
Entity Central Index Key | 0001560143 | |
Document Type | 10-Q | |
Document Period End Date | Sep. 30, 2020 | |
Amendment Flag | false | |
Current Fiscal Year End Date | --12-31 | |
Is Entity's Reporting Status Current? | Yes | |
Entity Filer Category | Non-accelerated Filer | |
Entity Common Stock, Shares Outstanding | 5,525,291 | |
Document Fiscal Period Focus | Q3 | |
Document Fiscal Year Focus | 2020 | |
Entity Small Business | true | |
Entity Emerging Growth | false | |
Entity Interactive data current | Yes | |
Entity File Number | 001-39478 | |
Entity Incorporation State Code | NV | |
Entity shell company | false |
Consolidated Balance Sheets (Un
Consolidated Balance Sheets (Unaudited) - USD ($) | Sep. 30, 2020 | Dec. 31, 2019 |
Current Assets: | ||
Cash | $ 290,884 | $ 619,104 |
Accounts receivable | 38,214 | 93,800 |
Inventory | 1,098 | 0 |
Work in process | 71,378 | 0 |
Prepaid expense and other current assets | 2,391 | 13,286 |
Total current assets | 403,965 | 726,190 |
Property and equipment, net | 64,504 | 80,273 |
Operating lease, right-of-use assets | 151,704 | 386,742 |
Total Assets | 620,173 | 1,193,205 |
Current Liabilities: | ||
Accounts payable and accrued expenses | 147,590 | 68,614 |
Accounts payable, related party | 103,024 | 76,280 |
Other payable | 895,000 | 895,000 |
Operating lease, right-of-use obligation, current portion | 91,368 | 150,909 |
Note payable, current portion | 140,000 | 0 |
Long-term debt, net of unamortized discount, current portion | 573,735 | 0 |
Total current liabilities | 1,950,717 | 1,190,803 |
Long-term liabilities: | ||
Operating lease, right-of-use obligation, long term portion | 68,778 | 237,042 |
Note payable, long term portion | 178,158 | 0 |
Total long-term liabilities | 246,936 | 237,042 |
Total Liabilities | 2,197,653 | 1,427,845 |
Stockholders' equity: | ||
Common stock, $0.001 par value, 495,000,000 shares authorized, 29,762,702 shares and 29,564,014 shares issued, 5,504,291 shares and 5,429,566 shares outstanding | 29,762 | 29,564 |
Additional paid-in capital | 25,874,719 | 25,207,137 |
Accumulated deficit | (21,803,842) | (20,118,169) |
Treasury Stock: | ||
Common stock, at cost, 24,174,448 shares and 24,134,448 shares | (5,325,042) | (5,100,218) |
Total stockholders' deficit | (1,577,480) | (234,640) |
Total liabilities and stockholders' deficit | 620,173 | 1,193,205 |
Series A Convertible Preferred Stock [Member] | ||
Stockholders' equity: | ||
Preferred stock, $0.001 par value 20,000,000 shares authorized | 2,520 | 2,560 |
Treasury Stock: | ||
Common stock, at cost, 24,174,448 shares and 24,134,448 shares | (179,368) | (179,368) |
Series B Convertible Preferred Stock [Member] | ||
Stockholders' equity: | ||
Preferred stock, $0.001 par value 20,000,000 shares authorized | 3,652 | 3,735 |
Treasury Stock: | ||
Common stock, at cost, 24,174,448 shares and 24,134,448 shares | $ (179,882) | $ (79,882) |
Consolidated Balance Sheets (_2
Consolidated Balance Sheets (Unaudited) (Parenthetical) - $ / shares | Sep. 30, 2020 | Dec. 31, 2019 |
Preferred stock, par value | $ .001 | $ .001 |
Preferred stock, shares authorized | 20,000,000 | 20,000,000 |
Common stock, par value | $ 0.001 | $ 0.001 |
Common stock, shares authorized | 495,000,000 | 495,000,000 |
Common stock, shares issued | 29,634,568 | 29,564,014 |
Common stock, shares outstanding | 5,460,120 | 5,429,566 |
Treasury stock | 24,174,448 | 24,134,448 |
Series A Convertible Preferred Stock [Member] | ||
Preferred stock, par value | $ 0.001 | $ 0.001 |
Preferred stock, shares authorized | 4,100,000 | 4,100,000 |
Preferred stock, shares issued | 2,520,000 | 2,560,000 |
Preferred stock, shares outstanding | 2,420,000 | 2,460,000 |
Treasury stock | 100,000 | 100,000 |
Series B Convertible Preferred Stock [Member] | ||
Preferred stock, par value | $ 0.001 | $ 0.001 |
Preferred stock, shares authorized | 6,650,000 | 6,650,000 |
Preferred stock, shares issued | 3,734,784 | 3,735,784 |
Preferred stock, shares outstanding | 3,691,249 | 3,691,249 |
Treasury stock | 84,535 | 44,535 |
Series C Convertible Preferred Stock [Member] | ||
Preferred stock, par value | $ 0.001 | $ 0.001 |
Preferred stock, shares authorized | 1,000 | 1,000 |
Preferred stock, shares issued | 1,000 | 1,000 |
Preferred stock, shares outstanding | 1,000 | 1,000 |
Consolidated Statements of Oper
Consolidated Statements of Operations (Unaudited) - USD ($) | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2020 | Sep. 30, 2019 | Sep. 30, 2020 | Sep. 30, 2019 | |
Income Statement [Abstract] | ||||
Revenue | $ 111,625 | $ 131,942 | $ 444,390 | $ 259,730 |
Cost of sales | 50,340 | 67,708 | 361,087 | 173,674 |
Gross profit | 61,285 | 64,234 | 83,303 | 86,056 |
Expenses: | ||||
Selling, general and administrative | 472,464 | 554,491 | 1,675,332 | 1,952,049 |
Research and development | 5,852 | 0 | 10,577 | 4,500 |
Depreciation and amortization | 9,229 | 27,513 | 28,808 | 126,515 |
Operating expenses, net | 487,545 | 582,004 | 1,714,717 | 2,083,064 |
Net operating loss | (426,260) | (517,770) | (1,631,414) | (1,997,008) |
Other income (expense): | ||||
Interest income | 9 | 23 | 40 | 106 |
Interest expense | (23,617) | (38) | (54,309) | (38) |
Total other income (expense) | (23,608) | (15) | (54,269) | 68 |
Net loss | $ (449,868) | $ (517,785) | $ (1,685,683) | $ (1,996,940) |
Weighted average number of common shares outstanding - basic and fully diluted | 5,482,206 | 5,192,045 | 5,469,502 | 5,071,058 |
Net loss per share - basic and fully diluted | $ (0.08) | $ (0.10) | $ (0.31) | $ (0.39) |
Consolidated Statement Of Stock
Consolidated Statement Of Stockholders' Equity (Deficit) (Unaudited) - USD ($) | Class A Preferred Stock | Class B Preferred Stock | Class C Preferred Stock | Common Stock | Treasury Stock | Class A Preferred Treasury Stock | Class B Preferred Treasury Stock | Additional Paid-In Capital | Accumulated (Deficit) | Total |
Beginning balance, shares at Dec. 31, 2018 | 2,560,000 | 3,735,784 | 1,000 | 29,106,868 | 24,134,448 | 100,000 | 44,535 | |||
Beginning balance, value at Dec. 31, 2018 | $ 2,560 | $ 3,735 | $ 1 | $ 29,107 | $ (5,100,218) | $ (179,368) | $ (79,882) | $ 23,131,864 | $ (17,264,788) | $ 543,011 |
Issuance of common stock, shares | 28,140 | |||||||||
Issuance of common stock, value | $ 28 | 115,023 | 115,051 | |||||||
Net loss | (625,982) | (625,982) | ||||||||
Ending balance, shares at Mar. 31, 2019 | 2,560,000 | 3,735,784 | 1,000 | 29,135,008 | 24,134,448 | 100,000 | 44,535 | |||
Ending balance, value at Mar. 31, 2019 | $ 2,560 | $ 3,735 | $ 1 | $ 29,135 | $ (5,100,218) | $ (179,368) | $ (79,882) | 23,246,887 | (17,890,770) | 32,080 |
Beginning balance, shares at Dec. 31, 2018 | 2,560,000 | 3,735,784 | 1,000 | 29,106,868 | 24,134,448 | 100,000 | 44,535 | |||
Beginning balance, value at Dec. 31, 2018 | $ 2,560 | $ 3,735 | $ 1 | $ 29,107 | $ (5,100,218) | $ (179,368) | $ (79,882) | 23,131,864 | (17,264,788) | 543,011 |
Net loss | (1,996,940) | |||||||||
Ending balance, shares at Sep. 30, 2019 | 2,560,000 | 3,735,784 | 1,000 | 29,384,391 | 24,134,448 | 100,000 | 44,535 | |||
Ending balance, value at Sep. 30, 2019 | $ 2,560 | $ 3,735 | $ 1 | $ 29,385 | $ (5,100,218) | $ (179,368) | $ (79,882) | 24,509,760 | (19,261,728) | (75,755) |
Beginning balance, shares at Mar. 31, 2019 | 2,560,000 | 3,735,784 | 1,000 | 29,135,008 | 24,134,448 | 100,000 | 44,535 | |||
Beginning balance, value at Mar. 31, 2019 | $ 2,560 | $ 3,735 | $ 1 | $ 29,135 | $ (5,100,218) | $ (179,368) | $ (79,882) | 23,246,887 | (17,890,770) | 32,080 |
Issuance of common stock, shares | 149,210 | |||||||||
Issuance of common stock, value | $ 149 | 704,618 | 704,767 | |||||||
Net loss | (853,173) | (853,173) | ||||||||
Ending balance, shares at Jun. 30, 2019 | 2,560,000 | 3,735,784 | 1,000 | 29,284,218 | 24,134,448 | 100,000 | 44,535 | |||
Ending balance, value at Jun. 30, 2019 | $ 2,560 | $ 3,735 | $ 1 | $ 29,284 | $ (5,100,218) | $ (179,368) | $ (79,882) | 23,951,505 | (18,743,943) | (116,326) |
Issuance of common stock, shares | 86,635 | |||||||||
Issuance of common stock, value | $ 87 | 490,579 | 490,666 | |||||||
Conversion of warrants, shares | 13,538 | |||||||||
Conversion of warrants, value | $ 14 | 67,676 | 67,690 | |||||||
Net loss | (517,785) | (517,785) | ||||||||
Ending balance, shares at Sep. 30, 2019 | 2,560,000 | 3,735,784 | 1,000 | 29,384,391 | 24,134,448 | 100,000 | 44,535 | |||
Ending balance, value at Sep. 30, 2019 | $ 2,560 | $ 3,735 | $ 1 | $ 29,385 | $ (5,100,218) | $ (179,368) | $ (79,882) | 24,509,760 | (19,261,728) | (75,755) |
Beginning balance, shares at Dec. 31, 2019 | 2,560,000 | 3,735,784 | 1,000 | 29,564,014 | 24,134,448 | 100,000 | 44,535 | |||
Beginning balance, value at Dec. 31, 2019 | $ 2,560 | $ 3,735 | $ 1 | $ 29,564 | $ (5,100,218) | $ (179,368) | $ (79,882) | 25,207,137 | (20,118,169) | (234,640) |
Issuance of common stock for services, shares | 10,554 | |||||||||
Issuance of common stock for services, value | $ 11 | 52,759 | 52,770 | |||||||
Issuance of common stock, shares | 20,000 | |||||||||
Issuance of common stock, value | $ 20 | 99,980 | 100,000 | |||||||
Issuance of warrants for service | 89,155 | 89,155 | ||||||||
Issuance of detachable warrants with debt | 80,053 | 80,053 | ||||||||
Net loss | (874,164) | (874,164) | ||||||||
Ending balance, shares at Mar. 31, 2020 | 2,560,000 | 3,735,784 | 1,000 | 29,594,568 | 24,134,448 | 100,000 | 44,535 | |||
Ending balance, value at Mar. 31, 2020 | $ 2,560 | $ 3,735 | $ 1 | $ 29,595 | $ (5,100,218) | $ (179,368) | $ (79,882) | 25,529,084 | (20,992,333) | (786,826) |
Beginning balance, shares at Dec. 31, 2019 | 2,560,000 | 3,735,784 | 1,000 | 29,564,014 | 24,134,448 | 100,000 | 44,535 | |||
Beginning balance, value at Dec. 31, 2019 | $ 2,560 | $ 3,735 | $ 1 | $ 29,564 | $ (5,100,218) | $ (179,368) | $ (79,882) | 25,207,137 | (20,118,169) | (234,640) |
Net loss | (1,685,683) | |||||||||
Ending balance, shares at Sep. 30, 2020 | 2,520,000 | 3,652,451 | 1,000 | 29,762,072 | 24,174,448 | 100,000 | 84,535 | |||
Ending balance, value at Sep. 30, 2020 | $ 2,520 | $ 3,652 | $ 1 | $ 29,762 | $ (5,325,042) | $ (179,368) | $ (179,882) | 25,874,719 | (21,803,842) | (1,577,480) |
Beginning balance, shares at Mar. 31, 2020 | 2,560,000 | 3,735,784 | 1,000 | 29,594,568 | 24,134,448 | 100,000 | 44,535 | |||
Beginning balance, value at Mar. 31, 2020 | $ 2,560 | $ 3,735 | $ 1 | $ 29,595 | $ (5,100,218) | $ (179,368) | $ (79,882) | 25,529,084 | (20,992,333) | (786,826) |
Conversion of Preferred Stock to Common Stock, shares converted | (40,000) | |||||||||
Conversion of Preferred Stock to Common Stock, amount converted | $ (40) | |||||||||
Conversion of Preferred Stock to Common Stock, shares issued | 40,000 | |||||||||
Conversion of Preferred Stock to Common Stock, value issued | $ 40 | |||||||||
Repurchase of Series B preferred and common stock, in exchange for note payable, shares | 40,000 | 40,000 | ||||||||
Repurchase of Series B preferred and common stock, in exchange for note payable, value | $ (100,000) | $ (100,000) | (200,000) | |||||||
Net loss | (361,641) | (361,641) | ||||||||
Ending balance, shares at Jun. 30, 2020 | 2,520,000 | 3,735,784 | 1,000 | 29,634,568 | 24,174,448 | 100,000 | 84,535 | |||
Ending balance, value at Jun. 30, 2020 | $ 2,520 | $ 3,735 | $ 1 | $ 29,635 | $ (5,200,218) | $ (179,368) | $ (179,882) | 25,529,084 | (21,353,974) | (1,348,467) |
Issuance of common stock for services, shares | 2,296 | |||||||||
Issuance of common stock for services, value | $ 2 | 11,478 | 11,480 | |||||||
Issuance of common stock, shares | 41,375 | |||||||||
Issuance of common stock, value | $ 41 | 206,834 | 206,875 | |||||||
Conversion of warrants, shares | 500 | |||||||||
Conversion of warrants, value | $ 1 | 2,499 | 2,500 | |||||||
Conversion of Preferred Stock to Common Stock, shares converted | (83,333) | |||||||||
Conversion of Preferred Stock to Common Stock, amount converted | $ (83) | |||||||||
Conversion of Preferred Stock to Common Stock, shares issued | 83,333 | |||||||||
Conversion of Preferred Stock to Common Stock, value issued | $ 83 | |||||||||
Dissolution of subsidiaries | $ (124,824) | 124,824 | ||||||||
Net loss | (449,868) | (449,868) | ||||||||
Ending balance, shares at Sep. 30, 2020 | 2,520,000 | 3,652,451 | 1,000 | 29,762,072 | 24,174,448 | 100,000 | 84,535 | |||
Ending balance, value at Sep. 30, 2020 | $ 2,520 | $ 3,652 | $ 1 | $ 29,762 | $ (5,325,042) | $ (179,368) | $ (179,882) | $ 25,874,719 | $ (21,803,842) | $ (1,577,480) |
Consolidated Statements of Cash
Consolidated Statements of Cash Flows (Unaudited) - USD ($) | 9 Months Ended | |
Sep. 30, 2020 | Sep. 30, 2019 | |
Cash flows from operating activities | ||
Net loss | $ (1,685,683) | $ (1,996,940) |
Adjustments to reconcile net loss to net cash used in operating activities: | ||
Depreciation | 28,807 | 126,515 |
Amortization of debt discount | 28,788 | 0 |
Stock based payments | 153,405 | 10,260 |
Non-cash lease expense | 100,538 | 94,350 |
Change in assets and liabilities: | ||
Accounts receivable | 55,881 | (106,110) |
Inventory | (1,098) | 0 |
Work in Process | (71,378) | 0 |
Prepaid expenses and other current assets | 10,606 | (47,093) |
Accounts payable and accrued expenses | 78,977 | (55,856) |
Accounts payable, related party | 26,744 | 0 |
Operating lease liability | (93,304) | (95,233) |
Net cash used in operating activities | (1,367,717) | (2,070,107) |
Cash flows from investing activities | ||
Purchase of equipment | (13,039) | 0 |
Net cash used in investing activities | (13,039) | 0 |
Cash flows from financing activities | ||
Payments on stock repurchase note payable | (60,000) | 0 |
Proceeds from issuance of debt | 803,158 | 0 |
Proceeds from exercise of warrants | 2,500 | 528,698 |
Proceeds from issuance of common stock | 306,878 | 555,406 |
Net cash provided by financing activities | 1,052,536 | 1,084,104 |
Net increase (decrease) in cash | (328,220) | (986,003) |
Cash - beginning | 619,104 | 1,721,135 |
Cash - ending | 290,884 | 735,132 |
Supplemental Disclosures | ||
Interest paid | 0 | 38 |
Income taxes | $ 0 | $ 0 |
Non-Cash Financing Activities | ||
Conversion of Series A preferred stock to common stock | 40 | 0 |
Conversion of series B preferred stock to common stock | $ 83 | |
Cancellation and renegotiation of leases | 134,616 | $ 0 |
Issuance of Stock Repurchase Note Payable | 200,000 | 0 |
Issuance of detachable warrants with Debt | 80,053 | 0 |
Issuance of common stock in exchange for registered link and equipment | 0 | 25,000 |
Issuance of common stock in lieu of deferred revenue | 0 | 105,000 |
ROU assets and operating lease obligations recognized | $ 0 | $ 408,649 |
A. Significant Accounting Polic
A. Significant Accounting Policies | 9 Months Ended |
Sep. 30, 2020 | |
Accounting Policies [Abstract] | |
Significant Accounting Policies | NOTE A – SIGNIFICANT ACCOUNTING POLICIES Basis of Presentation: Description of Business: On or about August 20, 2020, Capaciti Networks, Inc., our former subsidiary, was dissolved and on or about September 22, 2020, Wylink, Inc., our former subsidiary, was dissolved. No consideration was exchanged in either transaction. As a result of the dissolutions, we acquired the net assets and liabilities of both Wylink, Inc, and Capaciti Networks, Inc. and their operations continue as part of the Company. Basis of Accounting: Revenue and Cost Recognition The Company earns revenues from contracts with customers for (i) sales and installation of cellular enhancement equipment and (ii) support agreements. Revenue from the sale and installation of cellular enhancement equipment is recognized either when the installation is completed or as the company installs the cellular enhancement equipment, depending on the complexity of the system, such as the degree of customization of the equipment being installed, and the agreement with the customer. The less complex systems installed by the Company where management believes the installed equipment has an alternative use, due to the standard nature of the equipment sourced from our vendors that can be used in other projects, revenue from such contacts is recognized for completed installations upon customer acceptance. This assessment, at contract inception, is a management judgment based on the combination of equipment ordered, the services performed and whether or not material effort, within the context of the contract, would be required to rework the equipment for another project, and the term and terms of the contract with the customer. For example, such contracts are usually completed within 30-45 days. In larger more complex projects where the Company is creating an asset for the customer with no alternative use and has an enforceable right to payment for performance prior to contract completion, we recognize revenue utilizing the percentage of completion method. This method measures completion based on management’s estimate of total costs to complete each contract because management considers total costs to be the best available measure of progress on the contract. Support agreements entered into with customers are generally for a period of one year, during which the Company stands ready to provide service and support for installed systems at the customer site. Support agreement amounts are billed in advance to the customer, as agreed in the contract, and recorded as a contract liability. During the period, the Company provides unspecified firmware upgrades to installed client equipment as they are available. Management estimates that straight line recognition of revenue over the period of the support agreement contract is a faithful representation of the pattern of delivery on the Company’s obligation under these agreements. Sales tax is recorded on a net basis and excluded from revenue. Allowance for Doubtful Accounts: Operating Leases Right-of-use Assets and Operating Lease Obligations: We adopted obligations on these provisions on January 1, 2019 using the optional transition method that permits us to apply the new disclosure requirements in 2019 and continue to present comparative period information as required under FASB ASC Topic 840, "Leases." We did not have a cumulative-effect adjustment to the opening balance of retained earnings at the date of adoption. We elected the package of practical expedients permitted under the transition guidance within the new standard, which, among other things, allowed us to exclude leases with an initial term of 12 months or less from the right-of-use assets and obligations. Adoption of the standards had no impact on results of operations or liquidity. If we determine that an arrangement is or contains a lease, we recognize a right-of-use (“ROU”) asset and lease obligation at the commencement date of the lease. ROU assets represent our right to use an underlying asset for the lease term and lease obligations represent our lease payments arising from the lease. Operating lease ROU assets and obligations are recognized at commencement date based on the present value of lease payments over the lease term. As most of our leases do not provide an implicit rate, we use our incremental borrowing rate based on the information available at commencement date in determining the present value of lease payments. The operating lease ROU asset also includes any lease payments made and excludes lease incentives. Our lease terms may include options to extend or terminate the lease when it is reasonably certain that we will exercise that option. Lease expense for lease payments is recognized on a straight-line basis over the lease term. Inventories |
B. Going Concern
B. Going Concern | 9 Months Ended |
Sep. 30, 2020 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Going Concern | NOTE B – GOING CONCERN Our consolidated financial statements are prepared using accounting principles generally accepted in the United States of America applicable to a going concern, which contemplate the realization of assets and liquidation of liabilities in the normal course of business. We have incurred continuous losses from operations, have an accumulated deficit of $21,803,842 at September 30, 2020, and have reported negative cash flows from operations. In addition, we do not currently have the cash resources to meet our operating commitments for the next twelve months. The Company’s ability to continue as a going concern must be considered in light of the problems, expenses, and complications frequently encountered by entrance into established markets and the competitive nature in which we operate. These conditions raise substantial doubt about the Company’s ability to continue as a going concern. Our ability to continue as a going concern is dependent on our ability to generate sufficient cash from operations to meet our cash needs and/or to raise funds to finance ongoing operations and repay debt. However, there can be no assurance that we will be successful in our efforts to raise additional debt or equity capital and/or that our cash generated by our operations will be adequate to meet our needs. These factors, among others, indicate that we may be unable to continue as a going concern for a reasonable period of time. Management expects to continue to seek additional funding through private or public equity sources and will seek debt financing. |
C. Revenue and Accounts Receiva
C. Revenue and Accounts Receivable | 9 Months Ended |
Sep. 30, 2020 | |
Revenue from Contract with Customer [Abstract] | |
Revenue and Accounts Receivable | NOTE C – REVENUE AND ACCOUNTS RECEIVABLE The Company recognizes revenue in accordance with its accounting policy. The Company invoices customers and recognizes accounts receivable in an amount equivalent to which it has an unconditional right and expects to receive aligned with the agreement with the customer. The Company has contracted payment terms with its customer of net 15 days. The Company recognized revenue from performance obligations satisfied as of a point in time and over time as disaggregated in the table below. Timing of Revenue Recognition For the Nine Months Ended September 30, September 30, 2020 2019 Point in Time $ 444,322 $ 259,730 Over Time 68 – $ 444,390 $ 259,730 Due to the Company billing service agreements in advance and recognizing revenue for service agreements over time as more fully described in its accounting policy the Company carries a contract liability balance proportional to the time remaining on each customer agreement. The Company issues invoices to customers for completed work as performance obligations satisfied as of a point in time are fulfilled and does not carry a contract asset balance for these performance obligations. Contract Assets and Liabilities September 30, December 31, 2020 2019 Contract Liability $ (751 ) $ – $ (751 ) $ – The Company’s contracts for support services are typically for terms of one year or less. The aggregate amount of contract performance obligation as of September 30, 2020 and December 31, 2019 that the Company expects to recognize over the next year is $751 and $0, respectively. The Company is under no obligation and is not in the practice of providing customers with returns, rebates, discounts, or refunds and has not in an amount material to the financial statements. The Company, accordingly, does not recognize these obligations at the time of revenue recognition. The Company may receive consideration from customers who enter into support agreements in the future for incremental services provided to such customers. Those services are delivered as of a point in time when the customer requests the service. Future consideration as described is excluded from the transaction price calculated for support agreement performance obligations. The Company has applied the practical expedient that permits the Company to recognize revenue without regard to significant financing components based on the Company’s expectations about the transfer of services and the receipt of payment from customers. The effect of this practical expedient is not material to the Company’s financial statements. |
D. Property and Equipment
D. Property and Equipment | 9 Months Ended |
Sep. 30, 2020 | |
Property, Plant and Equipment [Abstract] | |
Property and Equipment | NOTE D – PROPERTY AND EQUIPMENT Property and equipment consist of the following: Property and Equipment September 30, December 31, 2020 2019 Telecommunication equipment and computers $ 1,105,939 $ 1,092,901 Less: accumulated depreciation (1,041,435 ) (1,012,628 ) $ 64,504 $ 80,273 Depreciation expense for the nine months ended September 30, 2020 and 2019 was $28,808 and $126,515, respectively. |
E. Debt
E. Debt | 9 Months Ended |
Sep. 30, 2020 | |
Debt Disclosure [Abstract] | |
Debt | NOTE E – DEBT As of September 30, 2020, the Company’s debt consists of the following: $200,000 of 0% unsecured notes payable due March 2021 $ 140,000 $625,000 of 7% unsecured notes payable due August 2021, net of unamortized discount of $51,265 573,735 $178,158 of 1% unsecured notes payable due April 2022 178,158 $ 891,893 In February 2020, we issued a note in the amount of $625,000 bearing simple interest at a rate of 7% per annum to one investor due August 2021. The note contains a feature that allows the Company to extend the maturity date up to six months, twice, in the Company’s sole discretion. This note was issued along with 62,500 common stock purchase warrants that were determined to have a fair market value of $80,053 on the issuance date, which was recorded as a debt discount and amortized over the term of the notes, with $28,788 amortized in the nine months ended September 2020 and reported in the statement of operations as interest expense. In April 2020, we entered into a Repurchase and General Release Agreement with one shareholder pursuant to which we issued a note payable in the amount of $200,000 bearing no interest and due on September 30, 2020. The note is payable in $10,000 monthly installments with the balance payable on the maturity date. The note contains a feature that allows the Company to extend the maturity date of the note to March 31, 2021 in the Company’s sole discretion, and if the Company exercises this option, the $10,000 monthly installments will continue until the extended maturity date on which date the balance of the note will be due. During the quarter, the Company extended the maturity date of the note under the terms of the note to March 2021. The Company made payments in the amount of $60,000 on the note during the period and the balance as of September 30, 2020 is $140,000. In April 2020, we received a loan pursuant to the Paycheck Protection Program (“PPP”) under the Coronavirus Aid, Relief, and Economic Security Act (the “CARES Act”) in the amount of $178,158. The loan bears interest at a fixed rate of 1% per annum after a six-month deferral period. The loan contains a feature pursuant to which the Small Business Administration (“SBA”) will forgive the balance of the loan under statutory authority and conditions set forth in the CARES Act. We anticipate forgiveness of 100% of the loan balance, but any portion not forgiven will be due in April 2022. The following is a summary of principal maturities during the next five years: 2020 (three months remaining) $ 30,000 2021 735,000 2022 178,158 $ 943,158 |
F. Leases
F. Leases | 9 Months Ended |
Sep. 30, 2020 | |
Leases [Abstract] | |
Leases | NOTE F – LEASES The Company leases facilities and office equipment under various operating leases, which generally are expected to be renewed or replaced by other leases. For the nine-month periods ended September 30, 2020 and 2019, operating lease expense totaled $115,363 and $130,443, respectively. For the three-month periods ended September 30, 2020 and 2019, operating lease expense totaled $24,474 and $35,599, respectively. The weighted average remaining lease term is 2.57 years and weighted average discount rate is 5.5% as of September 30, 2020. Future minimum lease payments as of September 30, 2020 are as follows: 2020 (three months remaining) $ 25,194 2021 85,695 2022 24,695 2023 23,536 2024 6,930 Thereafter 7,200 Total minimum lease payments 173,250 Less: imputed interest (13,104 ) Present value of minimum lease payments 160,146 Less: current portion of least obligation (91,368 ) Long-term lease obligation $ 68,778 |
G. Warrants
G. Warrants | 9 Months Ended |
Sep. 30, 2020 | |
Warrants and Rights Note Disclosure [Abstract] | |
Warrants | NOTE G – WARRANTS The Company has common stock purchase warrants outstanding at September 30, 2020 to purchase 2,409,675 shares of common stock exercisable until various dates through December 31, 2022. The warrants are exercisable at the following amounts and rates: 2,000,000 of which are exercisable at an exercise price of $1.00 per share and 155,000 of which are exercisable at an exercise price of $5.00 per share, and 254,675 of which are exercisable at an exercise price of the greater of $5.00 per share or (ii) 85% of the average closing price of our common stock, as quoted on the public securities trading market on which our common stock is then traded with the highest volume, for ten (10) consecutive trading days immediately prior to the date of exercise. To calculate the fair value of stock warrants at the date of grant, we use the Black-Scholes option pricing model. The volatility used is based on historical volatilities of selected peer group companies. Management estimates the average volatility considering current and future expected market conditions. The risk-free interest rate for periods within the contractual life of the option is based on the U.S. Treasury yield curve in effect at the time of grant. Each issuance is individually valued according to this procedure as of the date of issue with maturity dates between December 31, 2021 and December 31, 2022, volatility estimates between 35% to 44% and risk-free rates 0.38% to 1.44% in the period. On February 25, 2020, we issued a note in the amount of $625,000 bearing simple interest at a rate of 7% per annum to one shareholder. This note was issued along with 62,500 common stock purchase warrants that were determined to have a fair market value of $80,053 on the issuance date, which was recorded as a debt discount and amortized over the term of the notes, with $12,680 amortized in the current quarter, and $28,788 in the nine months ended September 30, 2020. On March 3, 2020, we issued 92,500 warrants for services rendered with a fair market value on the issuance date of $89,155 recorded as an expense in the period. On March 13, 2020, we issued 20,000 common stock purchase warrants to two investors as part of our offering of units, each unit consisting of one share of our common stock and one common stock purchase warrant. There were no warrants issued in the second quarter of 2020. During the third quarter we issued 41,375 common stock purchase warrants to six investors as part of our offering of units, each unit consisting of one share of our common stock and one common stock purchase warrant. The following is a summary of activity and outstanding common stock warrants: # of Warrants Balance, December 31, 2019 2,383,256 Warrants granted 216,375 Warrants exercised (500 ) Warrants expired (189,456 ) Outstanding, September 30, 2020 2,409,675 Exercisable, September 30, 2020 2,409,675 |
H. Stockholders' Equity
H. Stockholders' Equity | 9 Months Ended |
Sep. 30, 2020 | |
Equity [Abstract] | |
Stockholders' Equity | NOTE H – STOCKHOLDERS’ EQUITY Holders of common stock are entitled to one vote per share. The common stock does not have cumulative voting rights in the election of directors. Accordingly, the holders of a majority of the outstanding shares of common stock entitled to vote in any election of directors may elect all of the directors standing for election. Subject to preferential rights with respect to any series of preferred stock that may be issued, holders of the common stock are entitled to receive ratably such dividends as may be declared by the board of directors on the common stock out of funds legally available therefore and, in the event of liquidation, dissolution or winding-up of affairs, are entitled to share equally and ratably in all the remaining assets and funds. Series A preferred stock is nonvoting capital stock but may be converted into voting common stock. Each share of series A preferred stock is convertible at the option of the holder at any time after the issuance into one share of common stock, subject to adjustment from time to time in the event (i) the Company subdivides or combines its outstanding common stock into a greater or smaller number of shares, including stock splits and stock dividends; or (ii) of a reorganization or reclassification of common stock, the consolidation or merger with or into another company, the sale, conveyance or other transfer of substantially all of the Company assets to another corporation or other similar event, whereby securities or other assets are issuable or distributable to the holders of the outstanding common stock upon the occurrence of any such event; or (iii) of the issuance to the holders of Company common stock of securities convertible into, or exchangeable for, such shares of common stock. Each outstanding share of series A preferred stock will automatically convert into one share of common stock (a) if the common stock commences public trading on the NASDAQ capital market or better, (b) if the series A preferred stockholder receives distributions from the net profits pool equal to the original purchase price paid for their registered links, or (c) five years after the date of issuance of the series A preferred stock. The Company does not have any other right to require a conversion of the series A preferred stock into common stock. The Company does not have the option to redeem outstanding shares of series A preferred stock. A holder of the series A preferred stock has no preemptive rights to subscribe for any additional shares of any class of stock or for any issue of bonds, notes or other securities convertible into any class of stock. In the event of a liquidation, dissolution or winding-up whether voluntary or otherwise, after payment of debts and other liabilities, the holders of the series A preferred stock will be entitled to receive from the remaining net assets, before any distribution to the holders of the common stock, the amount of $1.50 per share. After payment of the liquidation preference to the holders of series A preferred stock and payment of any other distributions that may be required with respect to any other series of preferred stock, the remaining assets, if any, will be distributed ratably to the holders of the common stock and the holders of the series A preferred stock on an as-if converted basis. The series B preferred stock is voting capital stock. The holders of the series B preferred stock will vote on an as-converted basis with the common stock on all matters submitted to a vote of the shareholders. The holders of the series B preferred stock are not entitled to any dividends unless and until the series B preferred stock is converted into common stock. Each share of series B preferred stock is convertible at the option of the holder at any time after issuance into one share of common stock, subject to adjustment from time to time in the event (i) the Company subdivides or combines into outstanding common stock into a greater or smaller number of shares, including stock splits and stock dividends; or (ii) of a reorganization or reclassification of common stock, the consolidation or merger with or into another company, the sale, conveyance or other transfer of substantially all of the Company assets to another corporation or other similar event, whereby securities or other assets are issuable or distributable to the holders of the outstanding common stock upon the occurrence of any such event; or (iii) of the issuance by us to the holders of common stock of securities convertible into, or exchangeable for, such shares of common stock. Each outstanding share of series B preferred stock will automatically convert into one share of common stock at a conversion rate equal to the lesser of $3.00 per share or 75% of the average closing price of the Company’s common stock as quoted on the public securities trading market on which our common stock is then traded with the highest volume, for ten (10) consecutive trading days immediately after the first day of public trading of common stock if common stock commences public trading on the NASDAQ capital market or better, but in any event no less than $2.50 per share or at $3.00 per share five years after the date of issuance of the series B preferred stock. In the event of a liquidation, dissolution or winding-up whether voluntary or otherwise, after payment of debts and other liabilities, the holders of the series B preferred stock will be entitled to receive from the remaining net assets, before any distribution to the holders of the common stock, and pari pasu with the payment of a liquidation preference of $1.50 per share to the holders of the series A preferred stock, the amount of $3.00 per share. After payment of the liquidation preference to the holders of the series A preferred stock and the series B preferred stock, and payment of any other distribution that may be required with respect to any other series of preferred stock, the remaining assets, if any, will be distributed ratably to the holders of the common stock, the holders of the series A preferred stock, and the holders of the series B preferred stock on an as-if converted basis. The series C preferred stock is voting capital stock. For so long as any shares of the series C preferred stock remain issued and outstanding, the holders thereof, voting separately as a class, shall have the right, on or after July 20, 2016, to vote in an amount equal to 51% of the total vote (representing a super majority voting power) with respect to all matters submitted to a vote of the shareholders of Wytec. Such vote shall be determined by the holder(s) of a majority of the then issued and outstanding shares of series C preferred stock. For example, if there are 10,000 shares of our common stock issued and outstanding at the time of such shareholder vote, the holders of the series C preferred stock, voting separately as a class, will have the right to vote an aggregate of 10,408 shares, out of a total number of 20,408 shares voting. Additionally, the Company is prohibited from adopting any amendments to the Company’s bylaws or articles of incorporation, as amended, making any changes to the certificate of designation establishing the series C preferred stock, or effecting any reclassification of the series C preferred stock, without the affirmative vote of at least 66-2/3% of the outstanding shares of series C preferred stock. The Company may, however, by any means authorized by law and without any vote of the holders of shares of series C preferred stock, make technical, corrective, administrative or similar changes to such certificate of designation that do not, individually or in the aggregate, adversely affect the rights or preferences of the holders of shares of series C preferred stock. The holders of the series C preferred stock are not entitled to any dividends. Holders of the series C preferred stock have no conversion rights. The shares of the series C preferred stock shall be automatically redeemed by us at their par value on the first to occur of the following: (i) on the date that Mr. Gray ceases, for any reason, to serve as officer, director or consultant of Wytec, or (ii) on the date that our shares of common stock first trade on any national securities exchange provided that the listing rules of any such exchange prohibit preferential voting rights of a class of securities of Wytec, or listing on any such national securities exchange is conditioned upon the elimination of the preferential voting rights of the series C preferred stock set forth in the certificate of designation. A holder of the series C preferred stock has no preemptive rights to subscribe for any additional shares of any class of stock of Wytec or for any issue of bonds, notes or other securities convertible into any class of stock of Wytec. The holders of the Series C Preferred Stock are not entitled to any liquidation preference. In January 2020, the Company issued 554 shares of common stock to one vendor for services rendered at fair value of $2,770. In March 2020, the Company issued 20,000 shares of common stock to two investors for cash at $5.00 per share as part of the Company’s offering of units, each unit consisting of one share of the Company’s common stock and one common stock purchase warrant. In February 2020, the Company issued 10,000 shares of common stock at fair value of $50,000 to one employee pursuant to a severance agreement. In April 2020, the Company issued 40,000 shares of common stock in consideration for the conversion of 40,000 shares of Series A Preferred Stock by one shareholder. In April 2020, the Company entered into a Repurchase and General Release Agreement with one investor to repurchase 40,000 shares of common stock and 40,000 shares of series B preferred stock at $2.50 per share in exchange for a note payable in the amount of $200,000 bearing no interest and due on March 31, 2021 as extended under the terms of the note. No portion of the agreement with the investor was treated as an expense. The shares are held in treasury stock until cancelled or reissued by the Company. In July 2020, the Company issued 12,000 shares of common stock to two investors for cash at $5.00 per share as part of the Company’s offering of units, each unit consisting of one share of the Company’s common stock and one common stock purchase warrant. In August 2020, the Company issued 25,000 shares of common stock to four investors for cash at $5.00 per share as part of the Company’s offering of units, each unit consisting of one share of the Company’s common stock and one common stock purchase warrant. In September 2020, the Company issued 4,375 shares of common stock to one investor in lieu of making an accrued interest payment in cash at $5.00 per share as part of the Company’s offering of units, each unit consisting of one share of the Company’s common stock and one common stock purchase warrant. In September 2020, one investor exercised 500 common stock purchase warrants for which the Company issued 500 shares of common stock for cash at $5.00 per share. During the quarter, the Company issued 2,296 shares of common stock to one vendor for services rendered at fair value of $11,484. |
I. Related Party Transactions
I. Related Party Transactions | 9 Months Ended |
Sep. 30, 2020 | |
Related Party Transactions [Abstract] | |
Related Party Transactions | NOTE I – RELATED PARTY TRANSACTIONS The Company has an accounts payable balance owed to Richardson & Associates in the amount of $103,024 as of September 30, 2020, and $76,280 as of December 31, 2019. The Company incurred expense of $47,285 and $79,934 with Richardson & Associates as of the nine months ended September 30, 2020 and September 30, 2019, respectively. Mark Richardson is the owner of Richardson & Associates and he was appointed as a director of Wytec International, Inc. in September 2019. |
J. Concentrations
J. Concentrations | 9 Months Ended |
Sep. 30, 2020 | |
Risks and Uncertainties [Abstract] | |
Concentrations | NOTE J – CONCENTRATIONS The Company derived $365,692, 82%, and $0, 0%, of revenue in the nine months ended September 2020 and September 2019, respectively, from a single customer. The Company derived $0, 0%, and $70,585, 28%, and $0, 0%, and $61,781, 24%, and $0, 0%, and $40,864, 16%, of revenue in the nine months ended September 2020 and September 2019, respectively, from three additional customers. We continue to endeavor to diversify our customer base and make efforts to mitigate the risk associated with excess concentration of sales from a limited number of customers. |
K. Subsequent Events
K. Subsequent Events | 9 Months Ended |
Sep. 30, 2020 | |
Subsequent Events [Abstract] | |
Subsequent Events | NOTE K – SUBSEQUENT EVENTS During the fourth quarter of 2020, Wytec issued 21,000 shares of common stock and 21,000 common stock purchase warrants to seven investors for which Wytec has received $105,000 pursuant to Wytec’s offering of units under Rule 506(c) of Regulation D of the Securities Act, as amended, each unit consisting of one share of common stock and one common stock purchase warrant at a purchase price of $5.00 per unit. These warrants are exercisable for cash until December 31, 2021 at an exercise price equal to the greater of (i) $5.00 or (ii) 85% of the average closing price of our common stock as quoted on the public securities trading market on which our common stock is then traded with the highest volume, for ten (10) consecutive trading days immediately prior to the date of exercise. |
A. Significant Accounting Pol_2
A. Significant Accounting Policies (Policies) | 9 Months Ended |
Sep. 30, 2020 | |
Accounting Policies [Abstract] | |
Basis of Presentation | Basis of Presentation: |
Description of Business | Description of Business: On or about August 20, 2020, Capaciti Networks, Inc., our former subsidiary, was dissolved and on or about September 22, 2020, Wylink, Inc., our former subsidiary, was dissolved. No consideration was exchanged in either transaction. As a result of the dissolutions, we acquired the net assets and liabilities of both Wylink, Inc, and Capaciti Networks, Inc. and their operations continue as part of the Company. |
Basis of Accounting | Basis of Accounting: |
Revenue and Cost Recognition | Revenue and Cost Recognition The Company earns revenues from contracts with customers for (i) sales and installation of cellular enhancement equipment and (ii) support agreements. Revenue from the sale and installation of cellular enhancement equipment is recognized either when the installation is completed or as the company installs the cellular enhancement equipment, depending on the complexity of the system, such as the degree of customization of the equipment being installed, and the agreement with the customer. The less complex systems installed by the Company where management believes the installed equipment has an alternative use, due to the standard nature of the equipment sourced from our vendors that can be used in other projects, revenue from such contacts is recognized for completed installations upon customer acceptance. This assessment, at contract inception, is a management judgment based on the combination of equipment ordered, the services performed and whether or not material effort, within the context of the contract, would be required to rework the equipment for another project, and the term and terms of the contract with the customer. For example, such contracts are usually completed within 30-45 days. In larger more complex projects where the Company is creating an asset for the customer with no alternative use and has an enforceable right to payment for performance prior to contract completion, we recognize revenue utilizing the percentage of completion method. This method measures completion based on management’s estimate of total costs to complete each contract because management considers total costs to be the best available measure of progress on the contract. Support agreements entered into with customers are generally for a period of one year, during which the Company stands ready to provide service and support for installed systems at the customer site. Support agreement amounts are billed in advance to the customer, as agreed in the contract, and recorded as a contract liability. During the period, the Company provides unspecified firmware upgrades to installed client equipment as they are available. Management estimates that straight line recognition of revenue over the period of the support agreement contract is a faithful representation of the pattern of delivery on the Company’s obligation under these agreements. Sales tax is recorded on a net basis and excluded from revenue. |
Allowance for Doubtful Accounts | Allowance for Doubtful Accounts: |
Operating Leases Right-of-use Assets and Operating Lease Obligations | Operating Leases Right-of-use Assets and Operating Lease Obligations: We adopted obligations on these provisions on January 1, 2019 using the optional transition method that permits us to apply the new disclosure requirements in 2019 and continue to present comparative period information as required under FASB ASC Topic 840, "Leases." We did not have a cumulative-effect adjustment to the opening balance of retained earnings at the date of adoption. We elected the package of practical expedients permitted under the transition guidance within the new standard, which, among other things, allowed us to exclude leases with an initial term of 12 months or less from the right-of-use assets and obligations. Adoption of the standards had no impact on results of operations or liquidity. If we determine that an arrangement is or contains a lease, we recognize a right-of-use (“ROU”) asset and lease obligation at the commencement date of the lease. ROU assets represent our right to use an underlying asset for the lease term and lease obligations represent our lease payments arising from the lease. Operating lease ROU assets and obligations are recognized at commencement date based on the present value of lease payments over the lease term. As most of our leases do not provide an implicit rate, we use our incremental borrowing rate based on the information available at commencement date in determining the present value of lease payments. The operating lease ROU asset also includes any lease payments made and excludes lease incentives. Our lease terms may include options to extend or terminate the lease when it is reasonably certain that we will exercise that option. Lease expense for lease payments is recognized on a straight-line basis over the lease term. |
Inventories | Inventories |
C. Revenue Recognition (Tables)
C. Revenue Recognition (Tables) | 9 Months Ended |
Sep. 30, 2020 | |
Revenue from Contract with Customer [Abstract] | |
Disaggregation of Revenue | Timing of Revenue Recognition For the Nine Months Ended September 30, September 30, 2020 2019 Point in Time $ 444,322 $ 259,730 Over Time 68 – $ 444,390 $ 259,730 |
Contract Assets and Liabilities | Contract Assets and Liabilities September 30, December 31, 2020 2019 Contract Liability $ (751 ) $ – $ (751 ) $ – |
D. Property and Equipment (Tabl
D. Property and Equipment (Tables) | 9 Months Ended |
Sep. 30, 2020 | |
Property, Plant and Equipment [Abstract] | |
Schedule of Property and Equipment | Property and equipment consist of the following: Property and Equipment September 30, December 31, 2020 2019 Telecommunication equipment and computers $ 1,105,939 $ 1,092,901 Less: accumulated depreciation (1,041,435 ) (1,012,628 ) $ 64,504 $ 80,273 |
E. Debt (Tables)
E. Debt (Tables) | 9 Months Ended |
Sep. 30, 2020 | |
Debt Disclosure [Abstract] | |
Schedule of debt | As of September 30, 2020, the Company’s debt consists of the following: $200,000 of 0% unsecured notes payable due March 2021 $ 140,000 $625,000 of 7% unsecured notes payable due August 2021, net of unamortized discount of $51,265 573,735 $178,158 of 1% unsecured notes payable due April 2022 178,158 $ 891,893 |
Schedule of long term debt maturities | The following is a summary of principal maturities during the next five years: 2020 (three months remaining) $ 30,000 2021 735,000 2022 178,158 $ 943,158 |
F. Leases (Tables)
F. Leases (Tables) | 9 Months Ended |
Sep. 30, 2020 | |
Leases [Abstract] | |
Minimum Lease Payments | Future minimum lease payments as of September 30, 2020 are as follows: 2020 (three months remaining) $ 25,194 2021 85,695 2022 24,695 2023 23,536 2024 6,930 Thereafter 7,200 Total minimum lease payments 173,250 Less: imputed interest (13,104 ) Present value of minimum lease payments 160,146 Less: current portion of least obligation (91,368 ) Long-term lease obligation $ 68,778 |
G. Warrants (Tables)
G. Warrants (Tables) | 9 Months Ended |
Sep. 30, 2020 | |
Warrants and Rights Note Disclosure [Abstract] | |
Schedule of warrant activity | The following is a summary of activity and outstanding common stock warrants: # of Warrants Balance, December 31, 2019 2,383,256 Warrants granted 216,375 Warrants exercised (500 ) Warrants expired (189,456 ) Outstanding, September 30, 2020 2,409,675 Exercisable, September 30, 2020 2,409,675 |
A. Significant Accounting Pol_3
A. Significant Accounting Policies (Details Narrative) - USD ($) | Sep. 30, 2020 | Dec. 31, 2019 |
Accounting Policies [Abstract] | ||
Allowance for doubtful accounts | $ 0 | $ 0 |
B. Going Concern (Details Narra
B. Going Concern (Details Narrative) - USD ($) | Sep. 30, 2020 | Dec. 31, 2019 |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | ||
Accumulated deficit | $ (21,803,842) | $ (20,118,169) |
C. Revenue Recognition (Details
C. Revenue Recognition (Details - Disaggregation of Revenue) - USD ($) | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2020 | Sep. 30, 2019 | Sep. 30, 2020 | Sep. 30, 2019 | |
Revenue | $ 111,625 | $ 131,942 | $ 444,390 | $ 259,730 |
Transferred at Point in Time [Member] | ||||
Revenue | 444,322 | 259,730 | ||
Transferred over Time [Member] | ||||
Revenue | $ 68 | $ 0 |
C. Revenue Recognition (Detai_2
C. Revenue Recognition (Details - Contract Assets and Liabilities) - USD ($) | Sep. 30, 2020 | Dec. 31, 2019 |
Revenue from Contract with Customer [Abstract] | ||
Contract Liability | $ (751) | $ 0 |
D. Property and Equipment (Deta
D. Property and Equipment (Details) - USD ($) | Sep. 30, 2020 | Dec. 31, 2019 |
Property, Plant and Equipment [Abstract] | ||
Telecommunication equipment and computers | $ 1,105,939 | $ 1,092,901 |
Less: accumulated depreciation | (1,041,435) | (1,012,628) |
Property and equipment, net | $ 64,504 | $ 80,273 |
D. Property and Equipment (De_2
D. Property and Equipment (Details Narrative) - USD ($) | 9 Months Ended | |
Sep. 30, 2020 | Sep. 30, 2019 | |
Property, Plant and Equipment [Abstract] | ||
Depreciation expense | $ 28,807 | $ 126,515 |
E. Debt (Details - Debt)
E. Debt (Details - Debt) | Sep. 30, 2020USD ($) |
Debt outstanding | $ 891,893 |
Note Payable 1 [Member] | |
Debt outstanding | 140,000 |
Note Payable 2 [Member] | |
Debt outstanding | 573,735 |
Note Payable 3 [Member] | |
Debt outstanding | $ 178,158 |
E. Debt (Details - Debt maturit
E. Debt (Details - Debt maturity) | Sep. 30, 2020USD ($) |
Debt Disclosure [Abstract] | |
Future maturity of debt due 2020 (three months remaining) | $ 30,000 |
Future maturity of debt due 2021 | 735,000 |
Future maturity of debt due 2022 | 178,158 |
Long-term Debt | $ 943,158 |
E. Debt (Details Narrative)
E. Debt (Details Narrative) - USD ($) | 9 Months Ended | |||
Sep. 30, 2020 | Sep. 30, 2019 | Apr. 30, 2020 | Feb. 28, 2020 | |
Amortization of warrant discount | $ 28,788 | $ 0 | ||
Note Payable 2 [Member] | ||||
Debt face amount | $ 625,000 | |||
Debt stated interest rate | 7.00% | |||
Debt maturity date | Aug. 31, 2021 | |||
Warrants issued with debt, shares | 62,500 | |||
Warrants issued with debt, value | $ 80,053 | |||
Amortization of warrant discount | $ 28,788 | |||
Note Payable 1 [Member] | ||||
Debt face amount | $ 200,000 | |||
Debt maturity date | Mar. 31, 2021 | |||
Note Payable 3 [Member] | ||||
Debt face amount | $ 178,158 | |||
Debt stated interest rate | 1.00% | |||
Debt maturity date | Apr. 30, 2022 |
F. Leases (Details)
F. Leases (Details) - USD ($) | Sep. 30, 2020 | Dec. 31, 2019 |
Operating lease future minimum due | ||
2020 (three months remaining) | $ 25,194 | |
2021 | 85,695 | |
2022 | 24,695 | |
2023 | 23,536 | |
2024 | 6,930 | |
Thereafter | 7,200 | |
Total minimum lease payments | 173,250 | |
Less imputed interest | (13,104) | |
Total operating lease obligation | 160,146 | |
Less: current portion of lease obligation | (91,368) | $ (150,909) |
Long-term lease obligation | $ 68,778 | $ 237,042 |
F. Leases (Details Narrative)
F. Leases (Details Narrative) - USD ($) | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2020 | Sep. 30, 2019 | Sep. 30, 2020 | Sep. 30, 2019 | |
Leases [Abstract] | ||||
Operating lease expense | $ 24,474 | $ 35,599 | $ 115,363 | $ 130,443 |
Operating lease weighted average remaining lease term | 2 years 6 months 25 days | 2 years 6 months 25 days | ||
Weighted average discount rate | 5.50% | 5.50% |
G. Warrants (Details)
G. Warrants (Details) - Warrants [Member] | 9 Months Ended |
Sep. 30, 2020shares | |
Number of warrants outstanding, beginning balance | 2,383,256 |
Number of warrants granted | 216,375 |
Number of warrants exercised | (500) |
Number of warrants expired | (189,456) |
Number of warrants outstanding, ending balance | 2,409,675 |
Number of warrants exercisable | 2,409,675 |
G. Warrants (Details Narrative)
G. Warrants (Details Narrative) - USD ($) | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2020 | Sep. 30, 2020 | Sep. 30, 2019 | Dec. 31, 2019 | |
Amortization of warrant discount | $ 28,788 | $ 0 | ||
Warrants issued | 41,375 | |||
Warrants Issued for Services [Member] | ||||
Number of warrants granted | 92,500 | |||
Fair value of warrants granted | $ 89,155 | |||
Warrants Issued for Services [Member] | Two Investors [Member] | ||||
Number of warrants granted | 20,000 | |||
Note Payable 2 [Member] | ||||
Number of warrants granted | 62,500 | |||
Fair value of warrants granted | $ 80,053 | |||
Amortization of warrant discount | $ 28,788 | |||
Warrants [Member] | ||||
Warrants outstanding | 2,409,675 | 2,409,675 | 2,383,256 | |
Warrants exercisable | 2,409,675 | 2,409,675 | ||
Warrant expiration date | Dec. 31, 2022 | Dec. 31, 2022 | ||
Number of warrants granted | 216,375 | |||
Warrants [Member] | $1.00 Price [Member] | ||||
Warrants exercisable | 2,000,000 | 2,000,000 | ||
Exercise price | $ 1 | $ 1 | ||
Warrants [Member] | $5.00 Price [Member] | ||||
Warrants exercisable | 155,000 | 155,000 | ||
Exercise price | $ 5 | $ 5 | ||
Warrants [Member] | Greater than 5% or other [Member] | ||||
Warrants exercisable | 254,675 | 254,675 | ||
Exercise price | $ 5 | $ 5 |
H. Stockholders' Equity (Detail
H. Stockholders' Equity (Details Narrative) - USD ($) | 1 Months Ended | 2 Months Ended | 3 Months Ended | 4 Months Ended | 7 Months Ended | 8 Months Ended | 9 Months Ended | |
Jan. 31, 2020 | Feb. 28, 2020 | Sep. 30, 2020 | Mar. 31, 2020 | Apr. 30, 2020 | Jul. 30, 2020 | Aug. 31, 2020 | Sep. 30, 2020 | |
Stock issued for services, value | $ 11,480 | $ 52,770 | ||||||
Series A Convertible Preferred Stock [Member] | ||||||||
Stock converted, shares converted | 40,000 | |||||||
Stock converted, shares issued | 40,000 | |||||||
One Vendor [Member] | ||||||||
Stock issued for services, shares | 554 | 2,296 | ||||||
Stock issued for services, value | $ 2,770 | $ 11,484 | ||||||
Two Investors [Member] | ||||||||
Stock issued for cash, shares | 20,000 | 12,000 | ||||||
One Employee [Member] | ||||||||
Stock issued for services, shares | 10,000 | |||||||
Stock issued for services, value | $ 50,000 | |||||||
Repurchase and General Release Agr [Member] | ||||||||
Note payable issued | $ 200,000 | |||||||
Repurchase and General Release Agr [Member] | Common Stock | ||||||||
Stock repurchased | 40,000 | |||||||
Repurchase and General Release Agr [Member] | Series B Convertible Preferred Stock [Member] | ||||||||
Stock repurchased | 40,000 | |||||||
Four Investors [Member] | ||||||||
Stock issued for cash, shares | 25,000 | |||||||
One Investor [Member] | ||||||||
Stock issued for cash, shares | 500 | |||||||
Warrants exercised | 500 | |||||||
Stock issued in lieu of accrued interest | 4,375 |
J. Related Party Transactions (
J. Related Party Transactions (Details Narrative) - USD ($) | 9 Months Ended | ||
Sep. 30, 2020 | Sep. 30, 2019 | Dec. 31, 2019 | |
Accounts payable - related parties | $ 103,024 | $ 76,280 | |
Richardson and Associates [Member] | |||
Accounts payable - related parties | 103,024 | $ 76,280 | |
Related party expenses | $ 47,285 | $ 79,934 |
K. Concentrations (Details Narr
K. Concentrations (Details Narrative) - USD ($) | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2020 | Sep. 30, 2019 | Sep. 30, 2020 | Sep. 30, 2019 | |
Revenues | $ 111,625 | $ 131,942 | $ 444,390 | $ 259,730 |
Sales Revenue Net [Member] | One Customer [Member] | ||||
Concentration risk percentage | 82.00% | 0.00% | ||
Revenues | $ 365,692 | $ 0 | ||
Sales Revenue Net [Member] | Another Customer [Member] | ||||
Concentration risk percentage | 0.00% | |||
Revenues | $ 0 | $ 61,781 | ||
Sales Revenue Net [Member] | Another Customer [Member] | ||||
Concentration risk percentage | 28.00% | 0.00% | ||
Revenues | $ 70,585 | $ 0 | ||
Sales Revenue Net [Member] | Another Customer [Member] | ||||
Concentration risk percentage | 16.00% | |||
Revenues | $ 40,864 |