Document and Entity Information
Document and Entity Information - shares | 6 Months Ended | |
Jun. 30, 2020 | Aug. 13, 2020 | |
Cover [Abstract] | ||
Entity Registrant Name | TPT GLOBAL TECH, INC. | |
Entity Central Index Key | 0001661039 | |
Document Type | 10-Q | |
Document Period End Date | Jun. 30, 2020 | |
Amendment Flag | false | |
Current Fiscal Year End Date | --12-31 | |
Is Entity's Reporting Status Current? | Yes | |
Is Entity Emerging Growth Company? | true | |
Elected Not To Use the Extended Transition Period | false | |
Entity Filer Category | Non-accelerated Filer | |
Entity Small Business | true | |
Entity Shell Company | false | |
Entity Common Stock, Shares Outstanding | 857,562,371 | |
Document Fiscal Period Focus | Q2 | |
Document Fiscal Year Focus | 2020 | |
Entity Interactive Data Current | Yes | |
Entity Incorporation State Country Code | FL | |
Entity File Number | 333-222094 |
CONDENSED CONSOLIDATED BALANCE
CONDENSED CONSOLIDATED BALANCE SHEETS - USD ($) | Jun. 30, 2020 | Dec. 31, 2019 |
CURRENT ASSETS | ||
Cash and cash equivalents | $ 108,874 | $ 192,172 |
Accounts receivable, net | 110,696 | 379,805 |
Prepaid expenses and other current assets | 82,544 | 48,648 |
Total current assets | 302,114 | 620,625 |
NON-CURRENT ASSETS | ||
Property and equipment, net | 4,176,920 | 4,423,148 |
Operating lease right of use assets | 4,808,632 | 3,886,045 |
Intangible assets, net | 5,003,613 | 5,369,083 |
Goodwill | 1,050,366 | 1,050,366 |
Deposits and other assets | 104,486 | 104,486 |
Total non-current assets | 15,144,017 | 14,833,128 |
Total assets | 15,446,131 | 15,453,753 |
CURRENT LIABILITIES | ||
Accounts payable and accrued expenses | 6,834,684 | 6,543,635 |
Deferred revenue | 335,109 | 305,741 |
Customer liability | 338,725 | 338,725 |
Current portion of loans, advances and agreements | 1,794,497 | 344,758 |
Current portion of convertible notes payable, net of discounts | 1,711,098 | 2,101,649 |
Notes payable - related parties, net of discount | 10,111,240 | 9,297,078 |
Current portion of convertible notes payable - related parties, net of discounts | 781,581 | 534,381 |
Derivative liabilities | 6,805,480 | 8,836,514 |
Current portion of operating lease liabilities | 2,108,909 | 1,921,843 |
Financing lease liabilities - related party | 640,597 | 626,561 |
Total current liabilities | 31,461,920 | 30,850,885 |
NON-CURRENT LIABILITIES | ||
Loans, advances and agreements, net of current portion and discounts | 960,573 | 1,000,500 |
Convertible notes payable - related parties, net of current portion and discounts | 141,300 | 388,500 |
Long term portion of operating lease liabilities | 2,820,892 | 2,009,737 |
Total non-current liabilities | 3,922,765 | 3,398,737 |
Total liabilities | 35,384,685 | 34,249,622 |
Commitments and contingencies - See Note 8 | ||
Total mezzanine equity | 4,794,473 | 0 |
STOCKHOLDERS' DEFICIT | ||
Common stock, $.001 par value, 1,000,000,000 shares authorized, 857,562,371 and 177,629,939 shares issued and outstanding as of June 30, 2020 and December 31, 2019, respectively | 857,563 | 177,630 |
Subscriptions payable | 777,380 | 574,256 |
Additional paid-in capital | 9,959,111 | 13,279,749 |
Accumulated deficit | (36,327,081) | (32,831,093) |
Total stockholders' deficit | (24,773,027) | (18,795,869) |
Total liabilities and stockholders' deficit | 15,446,131 | 15,453,753 |
Series A Preferred Stock | ||
NON-CURRENT LIABILITIES | ||
Total mezzanine equity | 3,117,000 | 0 |
STOCKHOLDERS' DEFICIT | ||
Preferred stock, $.001 par value 100,000,000 shares authorized | 0 | 1,000 |
Series B Preferred Stock | ||
NON-CURRENT LIABILITIES | ||
Total mezzanine equity | 1,677,473 | 0 |
STOCKHOLDERS' DEFICIT | ||
Preferred stock, $.001 par value 100,000,000 shares authorized | 0 | 2,589 |
Series C Preferred Stock | ||
STOCKHOLDERS' DEFICIT | ||
Preferred stock, $.001 par value 100,000,000 shares authorized | 0 | 0 |
Series D Preferred Stock | ||
STOCKHOLDERS' DEFICIT | ||
Preferred stock, $.001 par value 100,000,000 shares authorized | $ 0 | $ 0 |
CONDENSED CONSOLIDATED BALANC_2
CONDENSED CONSOLIDATED BALANCE SHEETS (Parenthetical) - $ / shares | Jun. 30, 2020 | Dec. 31, 2019 | Jun. 30, 2019 |
Preferred stock, par value | $ 0.001 | $ 0.001 | |
Preferred stock, authorized | 100,000,000 | 100,000,000 | |
Common stock, par value | $ 0.001 | $ 0.001 | |
Common stock, authorized | 1,000,000,000 | 1,000,000,000 | |
Common stock, issued | 587,562,371 | 177,629,939 | |
Common stock, outstanding | 587,562,371 | 177,629,939 | |
Series A Preferred Stock | |||
Mezzanine stock, authorized | 1,000,000 | 1,000,000 | |
Mezzanine stock, issued | 1,000,000 | 1,000,000 | |
Mezzanine stock, outstanding | 1,000,000 | 1,000,000 | |
Preferred stock, authorized | 1,000,000 | 1,000,000 | |
Preferred stock, issued | 1,000,000 | 1,000,000 | |
Preferred stock, outstanding | 1,000,000 | 1,000,000 | |
Series B Preferred Stock | |||
Mezzanine stock, authorized | 3,000,000 | 3,000,000 | |
Mezzanine stock, issued | 2,588,693 | 2,588,693 | |
Mezzanine stock, outstanding | 2,588,693 | 2,588,693 | |
Preferred stock, authorized | 3,000,000 | 3,000,000 | |
Preferred stock, issued | 2,588,693 | 2,588,693 | |
Preferred stock, outstanding | 2,588,693 | 2,588,693 | |
Series C Preferred Stock | |||
Preferred stock, authorized | 3,000,000 | 3,000,000 | |
Preferred stock, issued | 0 | 0 | |
Preferred stock, outstanding | 0 | 0 | |
Series D Preferred Stock | |||
Preferred stock, authorized | 20,000,000 | 20,000,000 | |
Preferred stock, issued | 0 | 0 | |
Preferred stock, outstanding | 0 | 0 |
CONDENSED CONSOLIDATED STATEMEN
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS - USD ($) | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2020 | Jun. 30, 2019 | Jun. 30, 2020 | Jun. 30, 2019 | |
REVENUES: | ||||
Total revenues | $ 2,756,771 | $ 2,428,455 | $ 5,832,744 | $ 2,589,931 |
COST OF SALES: | ||||
Total costs of sales | 1,628,260 | 1,487,948 | 3,737,677 | 1,750,316 |
Gross profit | 1,114,111 | 940,507 | 2,095,067 | 839,615 |
EXPENSES: | ||||
Sales and marketing | 39,107 | 44,317 | 65,007 | 44,317 |
Professional | 410,755 | 483,913 | 754,722 | 996,453 |
Payroll and related | 584,136 | 367,017 | 1,246,138 | 564,558 |
General and administrative | 421,869 | 394,256 | 884,712 | 616,267 |
Research and development | 1,000,000 | 0 | 1,000,000 | 0 |
Depreciation | 259,964 | 128,000 | 517,367 | 199,707 |
Amortization | 182,735 | 354,129 | 365,470 | 560,131 |
Total expenses | 2,898,566 | 1,771,632 | 4,833,416 | 2,981,433 |
Income (loss) from operations | (1,784,455) | (831,125) | (2,738,349) | (2,141,818) |
OTHER INCOME (EXPENSE) | ||||
Derivative gain (expense) | 3,496,653 | (6,565,485) | (400,019) | (8,105,901) |
Gain (loss) on debt extinguishment | 1,252,131 | 0 | 1,252,131 | 0 |
Loss on debt conversions | (206,775) | 0 | (775,650) | 0 |
Interest expense | (287,344) | (1,147,201) | (834,101) | (1,277,438) |
Total other income (expenses) | 4,254,665 | (7,712,686) | (757,639) | (9,383,339) |
Net income (loss) before income taxes | 2,470,210 | (8,543,811) | (3,495,988) | (11,525,157) |
Income taxes | 0 | 0 | 0 | 0 |
Net income (loss) | $ 2,470,210 | $ (8,543,811) | $ (3,495,988) | $ (11,525,157) |
Income (loss) per common share: basic and diluted | $ .00 | $ (0.06) | $ (0.01) | $ (0.08) |
Weighted-average common shares outstanding: basic and diluted | 839,198,568 | 136,953,904 | 614,826,873 | 136,953,904 |
Products | ||||
REVENUES: | ||||
Total revenues | $ 16,940 | $ 15,086 | $ 28,091 | $ 33,769 |
COST OF SALES: | ||||
Total costs of sales | 14,400 | 15,100 | 27,300 | 35,600 |
Services | ||||
REVENUES: | ||||
Total revenues | 2,739,831 | 2,413,369 | 5,804,653 | 2,556,162 |
COST OF SALES: | ||||
Total costs of sales | $ 1,628,260 | $ 1,472,848 | $ 3,710,377 | $ 1,714,716 |
CONDENSED CONSOLIDATED STATEM_2
CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS' DEFICIT - USD ($) | Series A Preferred Stock | Series B Preferred Stock | Common Stock | Subscription Payable | Additional Paid-in Capital | Accumulated Deficit | Total |
Beginning balance, shares at Dec. 31, 2018 | 1,000,000 | 2,588,693 | 136,953,904 | ||||
Beginning balance, amount at Dec. 31, 2018 | $ 1,000 | $ 2,589 | $ 136,954 | $ 168,006 | $ 12,567,881 | $ (18,802,928) | $ (5,926,498) |
Issuance of stock and stock options for services | 203,126 | 113,488 | 316,614 | ||||
Net income (loss) | (11,525,157) | (11,525,157) | |||||
Ending balance, shares at Jun. 30, 2019 | 1,000,000 | 2,588,693 | 136,953,904 | ||||
Ending balance, amount at Jun. 30, 2019 | $ 1,000 | $ 2,589 | $ 136,954 | 371,132 | 12,681,369 | (30,328,085) | (17,135,041) |
Beginning balance, shares at Mar. 31, 2019 | 1,000,000 | 2,588,693 | 136,953,904 | ||||
Beginning balance, amount at Mar. 31, 2019 | $ 1,000 | $ 2,589 | $ 136,954 | 269,569 | 12,640,597 | (21,784,274) | (8,733,565) |
Issuance of stock and stock options for services | 101,563 | 40,772 | 142,335 | ||||
Net income (loss) | (8,543,811) | (8,543,811) | |||||
Ending balance, shares at Jun. 30, 2019 | 1,000,000 | 2,588,693 | 136,953,904 | ||||
Ending balance, amount at Jun. 30, 2019 | $ 1,000 | $ 2,589 | $ 136,954 | 371,132 | 12,681,369 | (30,328,085) | (17,135,041) |
Beginning balance, shares at Dec. 31, 2019 | 1,000,000 | 2,588,693 | 177,629,939 | ||||
Beginning balance, amount at Dec. 31, 2019 | $ 1,000 | $ 2,589 | $ 177,630 | 574,256 | 13,279,749 | (32,831,093) | (18,795,869) |
Common stock issuable for director services | 203,124 | 203,124 | |||||
Reclassification of preferred stock as mezzanine, shares | (1,000,000) | (2,588,693) | |||||
Reclassification of preferred stock as mezzanine, amount | $ (1,000) | $ (2,589) | (4,790,884) | (4,794,473) | |||
Common stock issued for convertible promissory note, shares | 679,932,432 | ||||||
Common stock issued for convertible promissory note, amount | $ 679,933 | 1,470,246 | 2,150,179 | ||||
Net income (loss) | (3,495,988) | (3,495,988) | |||||
Ending balance, shares at Jun. 30, 2020 | 0 | 0 | 857,562,371 | ||||
Ending balance, amount at Jun. 30, 2020 | $ 0 | $ 0 | $ 857,563 | 777,380 | 9,959,111 | (36,327,081) | (24,773,027) |
Beginning balance, shares at Mar. 31, 2020 | 1,000,000 | 2,588,693 | 737,324,774 | ||||
Beginning balance, amount at Mar. 31, 2020 | $ 1,000 | $ 2,589 | $ 737,325 | 675,818 | 14,473,982 | (38,797,291) | (22,906,577) |
Common stock issuable for director services | 101,562 | 101,562 | |||||
Reclassification of preferred stock as mezzanine, shares | (1,000,000) | (2,588,693) | |||||
Reclassification of preferred stock as mezzanine, amount | $ (1,000) | $ (2,589) | (4,790,884) | (4,794,473) | |||
Common stock issued for convertible promissory note, shares | 120,237,597 | ||||||
Common stock issued for convertible promissory note, amount | $ 120,238 | 276,013 | 396,251 | ||||
Net income (loss) | 2,470,210 | 2,470,210 | |||||
Ending balance, shares at Jun. 30, 2020 | 0 | 0 | 857,562,371 | ||||
Ending balance, amount at Jun. 30, 2020 | $ 0 | $ 0 | $ 857,563 | $ 777,380 | $ 9,959,111 | $ (36,327,081) | $ (24,773,027) |
CONDENSED CONSOLIDATED STATEM_3
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) | 6 Months Ended | |
Jun. 30, 2020 | Jun. 30, 2019 | |
Cash Flows from Operating Activities: | ||
Net loss | $ (3,495,988) | $ (11,525,157) |
Adjustments to reconcile net loss to net cash used in operating activities: | ||
Depreciation | 517,367 | 199,707 |
Amortization | 365,470 | 560,131 |
Amortization of debt discounts | 450,661 | 539,796 |
Promissory note issued for research and development | 1,000,000 | 0 |
Loss on conversion of notes payable | 775,650 | 0 |
Derivative expense | 400,019 | 8,105,901 |
Gain on extinguishment of debt | (1,252,131) | 0 |
Interest expense default penalty | 0 | 635,507 |
Share-based compensation: common stock | 203,124 | 203,126 |
Share-based compensation: stock options | 0 | 113,488 |
Changes in operating assets and liabilities: | ||
Accounts receivable | 269,109 | (189,829) |
Prepaid expenses and other assets | (33,895) | 44,646 |
Accounts payable and accrued expenses | 375,847 | 285,798 |
Operating lease right of use assets and liabilities | 75,634 | 0 |
Other liabilities | 30,238 | (55,322) |
Net cash used in operating activities | (318,895) | (1,082,208) |
Cash Flows from Investing Activities: | ||
Cash paid for acquisition of assets of SpeedConnect | 0 | (1,000,000) |
Purchase of equipment | (271,138) | 0 |
Net cash used in investing activities | (271,138) | (1,000,000) |
Cash Flows from Financing Activities: | ||
Proceeds from convertible notes and notes payable - related parties | 2,400 | 456,390 |
Proceeds from convertible notes, loans and advances | 1,311,800 | 2,659,181 |
Payment on loans, advances and agreements | (619,227) | (913,978) |
Payments on convertible notes and amounts payable - related parties | (188,238) | (39,807) |
Payments on financing lease liabilities | 0 | (9,889) |
Net cash provided by financing activities | 506,735 | 2,151,897 |
Net change in cash | (83,298) | 69,689 |
Cash and cash equivalents - beginning of period | 192,172 | 31,786 |
Cash and cash equivalents - end of period | 108,874 | 101,475 |
Supplemental Cash Flow Information: | ||
Cash paid for: interest | 115,493 | 9,857 |
Cash paid for: taxes | 0 | 0 |
Non-Cash Investing and Financing Activities: | ||
Debt discount on factoring agreement | 216,720 | 2,011,600 |
Acquisition of assets of SpeedConnect - liabilities assumed | 0 | 1,662,013 |
Common stock issued in conversion of convertible notes | 2,258,637 | 0 |
Convertible preferred Series A and B reclassified to mezzanine equity | $ 4,790,884 | $ 0 |
DESCRIPTION OF BUSINESS AND SUM
DESCRIPTION OF BUSINESS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | 6 Months Ended |
Jun. 30, 2020 | |
Accounting Policies [Abstract] | |
DESCRIPTION OF BUSINESS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | Nature of Operations The Company was originally incorporated in 1988 in the state of Florida. TPT Global, Inc., a Nevada corporation formed in June 2014, merged with Ally Pharma US, Inc., a Florida corporation, (“Ally Pharma”, formerly known as Gold Royalty Corporation) in a “reverse merger” wherein Ally Pharma issued 110,000,000 shares of Common Stock, or 80% ownership, to the owners of TPT Global, Inc. in exchange for all outstanding common stock of TPT Global Inc. and Ally Pharma agreed to change its name to TPT Global Tech, Inc. (jointly referred to as “the Company” or “TPTG”). The following acquisitions have resulted in entities which have been consolidated into TPTG. In 2014 the Company acquired all the assets of K Telecom and Wireless LLC (“K Telecom”) and Global Telecom International LLC (“Global Telecom”). Effective January 31, 2015, TPTG completed its acquisition of 100% of the outstanding stock of Copperhead Digital Holdings, Inc. (“Copperhead Digital”) and Subsidiaries, TruCom, LLC (“TruCom”), Nevada Utilities, Inc. (“Nevada Utilities”) and CityNet Arizona, LLC (“CityNet”). Effective September 30, 2016, the company acquired 100% ownership in San Diego Media Inc. (“SDM”). In October 2017, we entered into agreements to acquire Blue Collar, Inc. (“Blue Collar”) which closed as of September 1, 2018. On May 7, 2019 we completed the acquisition of a majority of the assets of SpeedConnect, LLC, which assets were conveyed into our wholly owned subsidiary TPT SpeedConnect, LLC (“TPT SC” or “TPT SpeedConnect”) which was formed on April 16, 2019. On January 8, 2020 we formed TPT Federal, LLC (“TPT Federal”), on March 7, 2020 we acquired 75% interest in Bridget Internet, LLC (“Bridge Internet” or “BIC”), On March 30, 2020 we formed TPT MedTech, LLC (“TPT MedTech”) and on June 6, 2020 we formed InnovaQor, Inc (“InnovaQor”). We are based in San Diego, California, and operate as a Media Content Hub for Domestic and International syndication Technology/Telecommunications company operating on our own proprietary Global Digital Media TV and Telecommunications infrastructure platform and also provide technology solutions to businesses domestically and worldwide. We are a rural Broadband Wireless Access (BWA) provider, Software as a Service (SaaS), Technology Platform as a Service (PAAS), Cloud-based Unified Communication as a Service (UCaaS) and carrier-grade performance and support for businesses over our private IP MPLS fiber and wireless network in the United States. Our cloud-based UCaaS services allow businesses of any size to enjoy all the latest voice, data, media and collaboration features in today's global technology markets. We also operate as a Master Distributor for Nationwide Mobile Virtual Network Operators (MVNO) and Independent Sales Organization (ISO) as a Master Distributor for Pre-Paid Cellphone services, Mobile phones, Cellphone Accessories and Global Roaming Cellphones. In addition, we create media marketing materials and content. Significant Accounting Policies Please refer to Note 1 of the Notes to the Consolidated Financial Statements in the Company's most recent Form 10-K for all significant accounting policies of the Company, with the exception of those discussed below. Basis of Presentation The accompanying unaudited condensed consolidated financial statements have been prepared according to the instructions to Form 10-Q and Section 210.8-03(b) of Regulation S-X of the Securities and Exchange Commission (“SEC”) and, therefore, certain information and footnote disclosures normally included in financial statements prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”) have been omitted. In the opinion of management, all adjustments (consisting of normal recurring accruals) considered necessary for a fair presentation have been included. Operating results for the three and six months ended June 30, 2020 are not necessarily indicative of the results that may be expected for the year ending December 31, 2020. These condensed consolidated financial statements should be read in conjunction with the Company’s consolidated financial statements for the year ended December 31, 2019. The condensed consolidated balance sheet at June 30, 2020, has been derived from the consolidated financial statements at that date, but does not include all of the information and footnotes required by GAAP. Our condensed consolidated financial statements include the accounts of K Telecom, Copperhead Digital, SDM, Blue Collar, TPT SpeedConnect, BIC, TPT Federal, TPT MedTech and InnovaQor. All intercompany accounts and transactions have been eliminated in consolidation. Consideration has also been given to the minority interest of 25% in BIC. Revenue Recognition On January 1, 2018, we adopted the new accounting standard ASC 606, Revenue from Contracts with Customers Identify the contract with the customer Identify the performance obligations in the contract Determine the transaction price Allocate the transaction price to performance obligations in the contract Recognize revenue when or as we satisfy a performance obligation. Reserves are recorded as a reduction in net sales and are not considered material to our consolidated statements of income for the six months ended June 30, 2020 and 2019. In addition, we invoice our customers for taxes assessed by governmental authorities such as sales tax and value added taxes, where applicable. We present these taxes on a net basis. The Company’s revenue generation for the six months ended June 30, 2020 and 2019 came from the following sources disaggregated by services and products, which sources are explained in detail below. For the six months ended June 30, 2020 For the six months ended June 30, 2019 TPT SpeedConnect $ 5,264,486 $ 1,946,820 Copperhead Digital — 128,130 K Telecom 28,091 33,769 San Diego Media 7,365 17,165 Blue Collar 526,092 464,047 Other 6,710 — Total Revenue $ 5,832,744 $ 2,589,931 TPT SpeedConnect: ISP and Telecom Revenue TPT SpeedConnect is a rural Internet provider operating in 10 Midwestern States under the trade name SpeedConnect. TPT SC’s primary business model is subscription based, pre-paid monthly reoccurring revenues, from wireless delivered, high-speed internet connections. In addition, the company resells third-party satellite and DSL internet and IP telephony services. Revenue generated from sales of telecommunications services is recognized as the transaction with the customer is considered closed and the customer receives and accepts the services that were the result of the transaction. There are no financing terms or variable transaction prices. Due date is detailed on monthly invoices distributed to customer. Services billed monthly in advance are deferred to the proper period as needed. Deferred revenue are contract liabilities for cash received before performance obligations for monthly services are satisfied. Deferred revenue at June 30, 2020 and December 31, 2019 are $335,109 and $305,741, respectively. Certain of our products require specialized installation and equipment. For telecom products that include installation, if the installation meets the criteria to be considered a separate element, product revenue is recognized upon delivery, and installation revenue is recognized when the installation is complete. The Installation Technician collects the signed quote containing terms and conditions when installing the site equipment at customer premises. Revenue for installation services and equipment is billed separately from recurring ISP and telecom services and is recognized when equipment is delivered and installation is completed. Revenue from ISP and telecom services is recognized monthly over the contractual period, or as services are rendered and accepted by the customer. The overwhelming majority of our revenue continues to be recognized when transactions occur. Since installation fees are generally small relative to the size of the overall contract and because most contracts are for two years or less, the impact of not recognizing installation fees over the contract is immaterial. Copperhead Digital: ISP and Telecom Revenue Copperhead Digital is a regional internet and telecom services provider operating in Arizona under the trade name Trucom. Copperhead Digital operates as a wireless telecommunications Internet Service Provider (“ISP”) facilitating both residential and commercial accounts. Copperhead Digital’s primary business model is subscription based, pre-paid monthly reoccurring revenues, from wireless delivered, high-speed internet connections. In addition, the company resells third-party satellite and DSL internet and IP telephony services. Revenue generated from sales of telecommunications services is recognized as the transaction with the customer is considered closed and the customer receives and accepts the services that were the result of the transaction. There are no financing terms or variable transaction prices. Due date is detailed on monthly invoices distributed to customer. Services billed monthly in advance are deferred to the proper period as needed. Deferred revenue are contract liabilities for cash received before performance obligations for monthly services are satisfied. Certain of our products require specialized installation and equipment. For telecom products that include installation, if the installation meets the criteria to be considered a separate element, product revenue is recognized upon delivery, and installation revenue is recognized when the installation is complete. The Installation Technician collects the signed quote containing terms and conditions when installing the site equipment at customer premises. Revenue for installation services and equipment is billed separately from recurring ISP and telecom services and is recognized when equipment is delivered and installation is completed. Revenue from ISP and telecom services is recognized monthly over the contractual period, or as services are rendered and accepted by the customer. The overwhelming majority of our revenue continues to be recognized when transactions occur. Since installation fees are generally small relative to the size of the overall contract and because most contracts are for a year or less, the impact of not recognizing installation fees over the contract is immaterial. K Telecom: Prepaid Phones and SIM Cards Revenue K Telecom generates revenue from reselling prepaid phones, SIM cards, and rechargeable minute traffic for prepaid phones to its customers (primarily retail outlets). Product sales occur at the customer’s locations, at which time delivery occurs and cash or check payment is received. The Company recognizes the revenue when they receive payment at the time of delivery. There are no financing terms or variable transaction prices. SDM: Ecommerce, Email Marketing and Web Design Services SDM generates revenue by providing ecommerce, email marketing and web design solutions to small and large commercial businesses, complete with monthly software support, updates and maintenance. Services are billed monthly. There are no financing terms or variable transaction prices. Platform infrastructure support is a prepaid service billed in monthly recurring increments. The services are billed a month in advance and due prior to services being rendered. The revenue is deferred when invoiced and booked in the month the service is provided. There is no deferred revenue at June 30, 2020 and December 31, 2019. Software support services (including software upgrades) are billed in real time, on the first of the month. Web design service revenues are recognized upon completion of specific projects. Revenue is booked in the month the services are rendered and payments are due on the final day of the month. There are usually no contract revenues that are deferred until services are performed. Blue Collar: Media Production Services Blue Collar creates original live action and animated content productions and has produced hundreds of hours of material for the television, theatrical, home entertainment and new media markets. Blue Collar designs branding and marketing campaigns and has had agreements with some of the world’s largest companies including PepsiCo, Intel, HP, WalMart and many other Fortune 500 companies. Additionally, they create motion picture, television and home entertainment marketing campaigns for studios including Sony, DreamWorks, Twentieth Century Fox, Universal Studios, Paramount Studios, and Warner Brothers. With regard to revenue recognition, Blue Collar receives an agreement from each client to perform defined work. Some agreements are written, some are verbal. Work may include creation of marketing materials and/or content creation. Some work may be short term and take weeks to create and some work may be longer and take months to create. There are instances where customer agreements segregate identifiable obligations (like filming on site vs. film editing and final production) with separate transaction pricing. The performance obligation is generally satisfied upon delivery of such film or production products, at which time revenue is recognized. There are no financing terms or variable transaction prices. Basic and Diluted Net Loss Per Share The Company computes net income (loss) per share in accordance with ASC 260, “Earning per Share”. ASC 260 requires presentation of both basic and diluted earnings per share (“EPS”) on the face of the income statement. Basic EPS is computed by dividing net income (loss) available to common shareholder (numerator) by the weighted average number of shares outstanding (denominator) during the period. Diluted EPS gives effect to all dilutive potential common shares outstanding during the period using the treasury stock method for options and warrants and using the if-converted method for preferred stock and convertible notes. In computing diluted EPS, the average stock price for the period is used in determining the number of shares assumed to be purchased from the exercise of stock options or warrants. Diluted EPS excludes all dilutive potential shares if their effect is anti-dilutive. As of June 30, 2020, the Company had shares that were potentially common stock equivalents as follows: 2020 Convertible Promissory Notes 1,201,118,785 Series A Preferred Stock (1) 1,219,627,539 Series B Preferred Stock 2,588,693 Stock Options and Warrants 4,333,333 2,427,668,350 (1) Holder of the Series A Preferred Stock which is Stephen J. Thomas, is guaranteed 60% of outstanding common stock upon conversion. The Company would have to authorize additional shares for this to occur as only 1,000,000,000 shares are currently authorized. Financial Instruments and Fair Value of Financial Instruments Our primary financial instruments at June 30, 2020 and December 31, 2019 consisted of cash equivalents, accounts receivable, accounts payable, notes payable and derivative liabilities. We apply fair value measurement accounting to either record or disclose the value of our financial assets and liabilities in our financial statements. Fair value is defined as the exchange price that would be received for an asset or paid to transfer a liability (an exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date. A fair value hierarchy requires an entity to maximize the use of observable inputs, where available, and minimize the use of unobservable inputs when measuring fair value. Described below are the three levels of inputs that may be used to measure fair value: Level 1 Level 2 Level 3 We consider our derivative financial instruments as Level 3. The balances for our derivative financial instruments as of June 30, 2020 are the following: Derivative Instrument Fair Value Fair value of Auctus Convertible Promissory Note $ 5,423,940 Fair value of EMA Financial Convertible Promissory Note 1,350,573 Fair value of Warrants issued with the derivative instruments 30,967 $ 6,805,480 Principles of Consolidation Our consolidated financial statements include the wholly-owned accounts of K Telecom and Global, Copperhead Digital, SDM, Blue Collar, TPT SpeedConnect, TPT Federal, TPT MedTech, and InnovaQor. The consolidated financial statements also include the accounts of Bridge Internet and as they become material will present the effects of a 25% noncontrolling interest. All intercompany accounts and transactions have been eliminated in consolidation. Use of Estimates The preparation of financial statements in conformity with United States generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, disclosures of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ materially from those estimates. The Company’s consolidated financial statements reflect all adjustments that management believes are necessary for the fair presentation of their financial condition and results of operations for the periods presented. Recently Adopted Accounting Pronouncements In June 2018, the FASB issued ASU No. 2018-07, Improvements to Nonemployee Share-Based Payment Accounting, which amends ASC 718, Compensation – Stock Compensation. This ASU requires that most of the guidance related to stock compensation granted to employees be followed for non-employees, including the measurement date, valuation approach, and performance conditions. The expense is recognized in the same period as though cash were paid for the good or service. The effective date is the first quarter of fiscal year 2020, with early adoption permitted, including in interim periods. The ASU has been adopted using a modified-retrospective transition approach. The adoption did not have a material effect on the consolidated financial statements. Management has reviewed other recently issued accounting pronouncements and have determined there are not any that would have a material impact on the condensed consolidated financial statements. |
ACQUISITIONS
ACQUISITIONS | 6 Months Ended |
Jun. 30, 2020 | |
Business Combinations [Abstract] | |
ACQUISITIONS | SpeedConnect Asset Acquisition Effective April 2, 2019, the Company entered into an Asset Purchase Agreement with SpeedConnect, LLC (“SpeedConnect”) to acquire substantially all of the assets of SpeedConnect. On May 7, 2019, the Company closed the transaction underlying the Asset Purchase Agreement with SpeedConnect to acquire substantially all of the assets of SpeedConnect for $2 million and the assumption of certain liabilities. The Asset Purchase Agreement required a deposit of $500,000 made in April and an additional $500,000 payment to close. The additional $500,000 was paid and all other conditions were met to effectuate the sale of substantially all of the assets of SpeedConnect to the Company. As part of the closing, the Company entered into a Promissory Note to pay SpeedConnect $1,000,000 in two equal installments of $500,000 plus applicable interest at 10% per annum with the first installment payable within 30 days of closing and the second installment payable within 60 days of closing (but no later than July 6, 2019). The Company paid off the Promissory Note by June 11, 2019 and by amendment dated May 7, 2019, SpeedConnect forgave $250,000 of the Promissory Note. The Company treated the asset acquisition as a business combination and has allocated the fair market value to assets received in excess of goodwill. Purchase Price Allocation: TPT Global Tech Effective May 7, 2019 Purchaser TPT Global Tech Consideration Given: Cash paid $ 1,000,000 Liabilities: Promissory Note $ 750,000 Deferred revenue 230,000 Operating lease liabilities 5,162,077 Unfavorable leases 323,000 Accounts and other payables 591,964 Total liabilities $ 7,057,041 Total Consideration Value $ 8,057,041 Assets Acquired: Customer base $ 350,000 Current assets: Cash 201,614 Prepaid and other receivables 99,160 Deposits 13,190 Operating lease right of use asset 5,162,077 Favorable leases 95,000 Property and equipment 1,939,000 Total Assets Acquired $ 7,860,041 Goodwill $ 197,000 Had the acquisition occurred on January 1, 2019, condensed proforma results of operations for the six months ended June 30, 2019 would be as follows: 2019 Revenue $ 7,352,758 Cost of Sales 4,754,166 Gross Profit $ 2,598,592 Expenses (4,514,097 ) Derivative Expense (8,105,901 ) Interest Expense (1,277,438 ) Income Taxes — Net Loss $ (11,298,844 ) Loss per share $ (0.08 ) The unaudited proforma results of operations are presented for information purposes only. The unaudited proforma results of operations are not intended to present actual results that would have been attained had the asset acquisition been completed as of January 1, 2019 or to project potential operating results as of any future date or for any future periods. The revenue and net income of TPT SpeedConnect from January 1, 2020 to June 30, 2020 included in the consolidated income statement amounted to $5,264,486 and $742,373, respectively. Bridge Internet Acquisition On March 6, 2020, the Company executed an Acquisition and Purchase Agreement (“BIC Agreement”) with Bridge Internet, a Florida Limited Liability Company, formed on February 27, 2020. The Company acquired 75% of Bridge Internet (which had no assets or liabilities and no material operations) for 8,000,000 shares of common stock of TPT Global Tech, Inc., 4,000,000 common shares issued to Sydney “Trip” Camper immediately and 4,000,000 common shares which vest equally over two years. As sufficient funding is raised by the Company, defined as approximately $3,000,000, marketing funds of up to $200,000 per quarter for the next year from date of signing the BIC Agreement will be provided and a formal employment agreement will be finalized. Tower industry Veteran, Founder and CEO of Bridge Internet, Sydney “Trip” Camper, will retain the remaining 25% of Bridge Internet and stay on as the CEO, as well as become the acting CEO of TPT Speed Connect. The Company entered into this transaction in order to expand its revenue base. The Company evaluated this acquisition in accordance with ASC 805-10-55-4 to discern whether the transaction met the definition of a business. The company concluded there were not a sufficient number of key processes that developed the inputs into outputs. Accordingly, the Company accounted for this transaction as the hiring of a key member of management. As such, 4,000,000 shares valued at $6,400 will be expensed and 4,000,000 additional shares valued at $6,400 will be amortized equally over 2 years. As operations become material, the Company will present the effects of the 25% noncontrolling interest. |
GOING CONCERN
GOING CONCERN | 6 Months Ended |
Jun. 30, 2020 | |
Going Concern [Abstract] | |
GOING CONCERN | The accompanying consolidated financial statements have been prepared assuming that the Company will continue as a going concern. Cash flows generated from operating activities were not enough to support all working capital requirements for the six months ended June 30, 2020 and 2019. We incurred $2,495,988 and $11,525,157, respectively, in losses, and we used $318,895 and $1,082,208, respectively, in cash for operations for the six months June 30, 2020 and 2019. Cash flows from financing activities were $506,735 and $2,151,897 for the same periods. These factors raise substantial doubt about the ability of the Company to continue as a going concern for a period of one year from the issuance of these financial statements. The financial statements do not include any adjustments that might result from the outcome of this uncertainty. In December 2019, COVID-19 emerged and has subsequently spread worldwide. The World Health Organization has declared COVID-19 a pandemic resulting in federal, state and local governments and private entities mandating various restrictions, including travel restrictions, restrictions on public gatherings, stay at home orders and advisories and quarantining of people who may have been exposed to the virus. After close monitoring and responses and guidance from federal, state and local governments, in an effort to mitigate the spread of COVID-19, around March 18, 2020 for an indefinite period of time, the Company closed its Blue Collar office in Los Angeles, California and its TPT SpeedConnect offices in Michigan, Idaho and Arizona. Most employees are working remotely, however this is not possible with certain employees and all subcontractors that work for Blue Collar. The Company continues to monitor developments, including government requirements and recommendations at the national, state, and local level to evaluate possible extensions to all or part of such closures. The Company has taken advantage of the stimulus offerings and received $722,200 in April 2020 and believes it has used these funds as is prescribed by the stimulus offerings to have the entire amount forgiven. A portion of the loan to Blue Collar is under the automatic forgiveness amount of $150,000. The Company is also in the process of trying to raise debt and equity financing, some of which may have to be used for working capital shortfalls if revenues decrease significantly because of the COVID-19 closures. As the COVID-19 pandemic is complex and rapidly evolving, the Company's plans as described above may change. At this point, we cannot reasonably estimate the duration and severity of this pandemic, which could have a material adverse impact on our business, results of operations, financial position and cash flows. In order for us to continue as a going concern for a period of one year from the issuance of these financial statements, we will need to obtain additional debt or equity financing and look for companies with cash flow positive operations that we can acquire. There can be no assurance that we will be able to secure additional debt or equity financing, that we will be able to acquire cash flow positive operations, or that, if we are successful in any of those actions, those actions will produce adequate cash flow to enable us to meet all our future obligations. Most of our existing financing arrangements are short-term. If we are unable to obtain additional debt or equity financing, we may be required to significantly reduce or cease operations. |
PROPERTY AND EQUIPMENT
PROPERTY AND EQUIPMENT | 6 Months Ended |
Jun. 30, 2020 | |
Property, Plant and Equipment [Abstract] | |
PROPERTY AND EQUIPMENT | Property and equipment and related accumulated depreciation as of June 30, 2020 and December 31, 2019 are as follows: 2020 2019 Property and equipment: Telecommunications fiber and equipment $ 5,421,920 5,203,000 Film production equipment 369,903 369,903 Office furniture and equipment 86,899 85,485 Medical equipment 50,805 — Leasehold improvements 18,679 18,679 Accumulated depreciation (1,771,286 ) (1,253,919 ) Property and equipment, net $ 4,176,920 4,423,148 Depreciation expense was $517,367 and $199,707 for the six months ended June 30, 2020 and 2019, respectively. |
DEBT FINANCING ARRANGEMENTS
DEBT FINANCING ARRANGEMENTS | 6 Months Ended |
Jun. 30, 2020 | |
Debt Disclosure [Abstract] | |
DEBT FINANCING ARRANGEMENTS | Financing arrangements as of June 30, 2020 and December 31, 2019 are as follows: 2020 2019 Business loans and advances (1) $ 2,284,196 1,121,640 Convertible notes payable (2) 1,711,098 2,101,649 Factoring agreements (3) 470,874 223,618 Debt – third party $ 4,466,168 3,446,907 Line of credit, related party secured by assets (4) $ 3,043,390 3,043,390 Debt– other related party, net of discounts (5) 6,950,000 5,950,000 Convertible debt – related party (6) 922,881 922,881 Shareholder debt (7) 117,850 303,688 Debt – related party $ 11,034,121 10,219,959 Total financing arrangements $ 15,500,289 13,666,866 Less current portion: Loans, advances and agreements – third party $ (1,794,497 ) (344,758 ) Convertible notes payable third party (1,711,098 ) (2,101,649 Debt – related party, net of discount (10,111,240 ) (9,297,078 ) Convertible notes payable– related party (781,581 ) (534,381 ) (14,398,416 ) (12,277,866 ) Total long term debt $ 1,101,873 1,389,000 (1) The terms of $40,000 of this balance are similar to that of the Line of Credit which bears interest at adjustable rates, 1 month Libor plus 2%, 2.2% as of June 30, 2020, and is secured by assets of the Company, is due August 31, 2020, as amended, and included 8,000 stock options as part of the terms which options expired December 31, 2019 (see Note 7). $500,500 is a line of credit that Blue Collar has with a bank, bears interest at Prime plus 1.125%, 4.38% as of June 30, 2020, and is due March 25, 2021. $480,954 is a bank loan dated May 28, 2019 which bears interest at Prime plus 6%, 9.25% as of June 30, 2020, is interest only for the first year, thereafter beginning in June of 2020 payable monthly of principal and interest of $22,900 until the due date of May 1, 2022. The bank loan is collateralized by assets of the Company. $722,219 represents loans under the COVID-19 Pandemic Paycheck Protection Program (“PPP”) originated in April of 2020. The Company believes that it has used the funds such that 100% will be forgiven when it applies for forgiveness in the third or fourth quarter of 2020. $119,371 of this amount relates to a PPP loan for Blue Collar which falls under the automatic forgiveness provisions approved by Congress of all loans under $150,000. If any of the PPP loans are not forgiven then, per the PPP, the unforgiven loan amounts will be payable monthly over a five year period of which payment are to begin no later than 10 months after the covered period as defined at a 2% annual interest rate. On June 4, 2019, the Company consummated a Securities Purchase Agreement with Odyssey Capital Funding, LLC. (“Odyssey”) for the purchase of a $525,000 Convertible Promissory Note (“Odyssey Convertible Promissory Note”). The Odyssey Convertible Promissory Note was due June 3, 2020, paid interest at the rate of 12% ( 24% default) per annum and gave the holder the right from time to time, and at any time during the period beginning six months from the issuance date to convert all of the outstanding balance into common stock of the Company limited to 4.99% of the outstanding common stock of the Company. The conversion price was 55% multiplied by the average of the two lowest trading prices for the common stock during the previous 20 trading days prior to the applicable conversion date. The Odyssey Convertible Promissory Note could be prepaid in full at 125% to 145% up to 180 days from origination. Through June 3, 2020, Odyssey converted $49,150 of principal and $4,116 of accrued interest into 52,961,921 shares of common stock of the Company. On June 8, 2020, Odyssey agreed to convert the remaining principal and accrued interest balance on the Odyssey Convertible Promissory Note of $475,850 and $135,000, respectively, to a term loan payable in six months in the form of a balloon payment, earlier if the Company has a funding event, bearing simple interest on the unpaid balance of 0% for the first three months and then 10% per annum thereafter. The remaining balances generally bear interest at approximately 10%, have maturity dates that are due on demand or are past due, are unsecured and are classified as current in the balance sheets. (2) During 2017, the Company issued convertible promissory notes in the amount of $67,000 (comprised of $62,000 from two related parties and $5,000 from a former officer of CDH), all which were due May 1, 2020 and bear 6% annual interest (12% default interest rate). The convertible promissory notes are convertible, as amended, at $0.25 per share. These convertible promissory notes were not repaid May 1, 2020. Management is working to extend the due dates. During 2019, the Company consummated Securities Purchase Agreements dated March 15, 2019, April 12, 2019, May 15, 2019, June 6, 2019 and August 22, 2019 with Geneva Roth Remark Holdings, Inc. (“Geneva Roth”) for the purchase of convertible promissory notes in the amounts of $68,000, $65,000, $58,000, $53,000 and $43,000 (“Geneva Roth Convertible Promissory Notes”). The Geneva Roth Convertible Promissory Notes are due one year from issuance, pays interest at the rate of 12% (principal amount increases 150%-200% and interest rate increases to 24% under default) per annum and gives the holder the right from time to time, and at any time during the period beginning 180 days from the origination date to the maturity date or date of default to convert all or any part of the outstanding balance into common stock of the Company limited to 4.99% of the outstanding common stock of the Company. The conversion price is 61% multiplied by the average of the two lowest trading prices for the common stock during the previous 20 trading days prior to the applicable conversion date. The Geneva Roth Convertible Promissory Notes may be prepaid in whole or in part of the outstanding balance at 125% to 140% up to 180 days from origination. Geneva Roth converted a total of $244,000 of principal and $8,680 of accrued interest through June 30, 2020 from its various Securities Purchase Agreements into 125,446,546 shares of common stock of the Company leaving no outstanding principal balances as of June 30, 2020. On February 13, 2020, the August 22, 2019 Securities Purchase Agreement was repaid for $63,284, including a premium and accrued interest. On March 25, 2019, the Company consummated a Securities Purchase Agreement dated March 18, 2019 with Auctus Fund, LLC. (“Auctus”) for the purchase of a $600,000 Convertible Promissory Note (“Auctus Convertible Promissory Note”). The Auctus Convertible Promissory Note is due December 18, 2019, pays interest at the rate of 12% (24% default) per annum and gives the holder the right from time to time, and at any time during the period beginning 180 days from the origination date or at the effective date of the registration of the underlying shares of common stock, which the holder has registration rights for, to convert all of the outstanding balance into common stock of the Company limited to 4.99% of the outstanding common stock of the Company. The conversion price is the lessor of the lowest trading price during the previous 25 trading days prior the date of the Auctus Convertible Promissory Note or 50% multiplied by the average of the two lowest trading prices for the common stock during the previous 25 trading days prior to the applicable conversion date. The Auctus Convertible Promissory Note may be prepaid in full at 135% to 150% up to 180 days from origination. Auctus converted $33,180 of principal and $142,004 of accrued interest into 376,000,000 shares of common stock of the Company prior to June 30, 2020. 2,000,000 warrants were issued in conjunction with the issuance of this debt. See Note 7. On June 6, 2019, the Company consummated a Securities Purchase Agreement with JSJ Investments Inc. (“JSJ”) for the purchase of a $112,000 Convertible Promissory Note (“JSJ Convertible Promissory Note”). The JSJ Convertible Promissory Note is due June 6, 2020, pays interest at the rate of 12% per annum and gives the holder the right from time to time, and at any time during the period beginning 180 days from the origination date to convert all of the outstanding balance into common stock of the Company limited to 4.99% of the outstanding common stock of the Company. The conversion price is the lower of the market price, as defined, or 55% multiplied by the average of the two lowest trading prices for the common stock during the previous 20 trading days prior to the applicable conversion date. The JSJ Convertible Promissory Note may be prepaid in full at 135% to 150% up to 180 days from origination. JSJ converted $43,680 of principal into 18,500,000 shares of common stock of the Company prior to June 30, 2020. In addition, on February 25, 2020 the Company repaid for $97,000, including a premium and accrued interest, for all remaining principal and accrued interest balances as of that day. 333,333 warrants were issued in conjunction with the issuance of this debt. See Note 7. On June 11, 2019, the Company consummated a Securities Purchase Agreement with EMA Financial, LLC. (“EMA”) for the purchase of a $250,000 Convertible Promissory Note (“EMA Convertible Promissory Note”). The EMA Convertible Promissory Note is due June 11, 2020, pays interest at the rate of 12% (principal amount increases 200% and interest rate increases to 24% under default) per annum and gives the holder the right from time to time to convert all of the outstanding balance into common stock of the Company limited to 4.99% of the outstanding common stock of the Company. The conversion price is 55% multiplied by the lowest traded price for the common stock during the previous 25 trading days prior to the applicable conversion date. The EMA Convertible Promissory Note may be prepaid in full at 135% to 150% up to 180 days from origination. Prior to June 30, 2020, EMA converted $35,366 of principal into 147,700,000 shares of common stock of the Company. 1,000,000 warrants were issued in conjunction with the issuance of this debt. See Note 7. The Company is in default under its derivative financial instruments and received notice of such from Auctus and EMA for not reserving enough shares for conversion and for not having filed a Form S-1 Registration Statement with the Securities and Exchange Commission. It was the intent of the Company to pay back all derivative securities prior to the due dates but that has not occurred in case of Auctus or EMA. As such, the Company is currently in negotiations with Auctus and EMA and relative to extending due dates and changing terms on the Notes. On February 14, 2020, the Company agreed to a Secured Promissory Note with a third party for $90,000. The Secured Promissory Note was secured by the assets of the Company and was due June 14, 2020 or earlier in case the Company is successful in raising other monies and carried an interest charge of 10% payable with the principal. The Secured Promissory Note was also convertible at the option of the holder into an equivalent amount of Series D Preferred Stock. The Secured Promissory Note also included a guaranty by the CEO of the Company, Stephen J. Thomas III. This Secured Promissory Note was paid off in June 2020, including $9,000 of interest in June and $1,000 in July 2020. (3) The Factoring Agreement with full recourse, due February 29, 2020, as amended, was established in June 2016 with a company that is controlled by a shareholder and is personally guaranteed by an officer of the Company. The Factoring Agreement is such that the Company pays a discount of 2% per each 30-day period for each advance received against accounts receivable or future billings. The Company was advanced funds from the Factoring Agreement for which $101,244 and $101,244 in principal remained unpaid as of June 30, 2020 and December 31, 2019, respectively. On May 8, 2019, the Company entered into a factoring agreement with Advantage Capital Funding (“2019 Factoring agreement”). $500,000, net of expenses, was funded to the Company with a promise to pay $18,840 per week for 40 weeks until a total of $753,610 is paid which occurred in February 2020. On February 25, 2020, the Company entered into an Agreement for the Purchase and Sale of Future Receipts (“2020 Factoring Agreement”). The balance to be purchased and sold is $716,720 for which the Company received $500,000, net of fees. Under the 2020 Factoring Agreement, the Company was to pay $14,221 per week for 50 weeks at an effective interest rate of approximately 43% annually. However, due to COVID-19 the payments under the 2020 Factoring Agreement were reduced temporarily, to between $9,000 and $10,500 weekly, of which $54,360 in payments have been deferred to be paid at the end of the 50-week term. The 2020 Factoring Agreement includes a guaranty by the CEO of the Company, Stephen J. Thomas III. (4) The Line of Credit originated with a bank and was secured by the personal assets of certain shareholders of Copperhead Digital. During 2016, the Line of Credit was assigned to the Copperhead Digital shareholders, who subsequent to the Copperhead Digital acquisition by TPTG became shareholders of TPTG, and the secured personal assets were used to pay off the bank. The Line of Credit bears a variable interest rate based on the 1 Month LIBOR plus 2.0%, 2.16% as of June 30, 2020, is payable monthly, and is secured by the assets of the Company. 1,000,000 shares of Common Stock of the Company have been reserved to accomplish raising the funds to pay off the Line of Credit. Since assignment of the Line of Credit to certain shareholders, which balance on the date of assignment was $2,597,790, those shareholders have loaned the Company $445,600 under the similar terms and conditions as the line of credit but most of which were also given stock options totaling $85,120 which expired as of December 31, 2019 (see Note 7) and is due, as amended, August 31, 2020. During the year ended December 31, 2019 and 2018, those same shareholders and one other have loaned the Company money in the form of convertible loans of $136,400 and $537,200, respectively, described in (2) and (6). (5) $350,000 represents cash due to the prior owners of the technology acquired in December 2016 from the owner of the Lion Phone which is due to be paid as agreed by TPTG and the former owners of the Lion Phone technology and has not been determined. $4,000,000 represents a promissory note included as part of the consideration of ViewMe Live technology acquired in 2017, later agreed to as being due and payable in full, with no interest with $2,000,000 from debt proceeds and the remainder from proceeds from the second Company public offering. $1,000,000 represents a promissory note which was entered into on May 6, 2020 for the acquisition of Media Live One Platform from . This $1,000,000 promissory note is On September 1, 2018, the Company closed on its acquisition of Blue Collar. Part of the acquisition included a promissory note of $1,600,000 and interest at 3% from the date of closure. The promissory note is secured by the assets of Blue Collar. (6) During 2016, the Company acquired SDM which consideration included a convertible promissory note for $250,000 due February 29, 2019, as amended, does not bear interest, unless delinquent in which the interest is 12% per annum, and is convertible into common stock at $1.00 per share. The SDM balance is $182,381 as of June 30, 2020. As of March 1, 2020, this convertible promissory note is delinquent. During 2018, the Company issued convertible promissory notes in the amount of $537,200 to related parties and $10,000 to a non-related party which bear interest at 6% (11% default interest rate), are due 30 months from issuance and are convertible into Series C Preferred Stock at $1.00 per share. Because the Series C Preferred Stock has a conversion price of $0.15 per share, the issuance of Series C Preferred Stock promissory notes will cause a beneficial conversion feature of approximately $38,479 upon exercise of the convertible promissory notes. (7) The shareholder debt represents funds given to TPTG or subsidiaries by officers and managers of the Company as working capital. There are no written terms of repayment or interest that is being accrued to these amounts and they will only be paid back, according to management, if cash flows support it. They are classified as current in the balance sheets. See Lease financing arrangement in Note 8. |
DERIVATIVE FINANCIAL INSTRUMENT
DERIVATIVE FINANCIAL INSTRUMENTS | 6 Months Ended |
Jun. 30, 2020 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
DERIVATIVE FINANCIAL INSTRUMENTS | The Company previously adopted the provisions of ASC subtopic 825-10, Financial Instruments The derivative liability as of June 30, 2020, in the amount of $6,805,480 has a level 3 classification under ASC 825-10. The following table provides a summary of changes in fair value of the Company’s Level 3 financial liabilities as of June 30, 2020. Debt Derivative Liabilities Balance, December 31, 2018 $ — Debt discount from initial derivative 1,774,000 Initial fair value of derivative liabilities 2,601,631 Change in derivative liability from conversion of notes payable (407,654 ) Change in fair value of derivative liabilities at end of period 4,868,537 Balance, December 31, 2019 $ 8,836,514 Change in derivative liabilities from conversion of notes payable (1,144,290 ) Change in derivative liabilities from the Odyssey conversion to a term loan (1,286,763 ) Change in fair value of derivative liabilities at end of period 400,019 Balance, June 30, 2020 $ 6,805,480 Derivative expense for the six months ended June 30, 2020 $ 400,019 Convertible notes payable and warrant derivatives – As of June 30, 2020, the Company marked to market the fair value of the debt derivatives and determined a fair value of $6,805,480 ($6,774,513 from the convertible notes and $30,968 from the warrants) in Note 5 (2) above. The Company recorded a loss from change in fair value of debt derivatives of $400,019 for the six months ended June 30, 2020. The fair value of the embedded derivatives was determined using Monte Carlo simulation method based on the following assumptions: (1) dividend yield of 0%, (2) expected volatility of 314.2% to 350.3%, (3) weighted average risk-free interest rate of 0.16% to 0.24% (4) expected life of 0.72 to 5.0 years, and (5) the quoted market price of $0.029 to $0.029 for the Company’s common stock. See Financing lease arrangements in Note 8. |
STOCKHOLDERS' DEFICIT
STOCKHOLDERS' DEFICIT | 6 Months Ended |
Jun. 30, 2020 | |
STOCKHOLDERS' DEFICIT | |
STOCKHOLDERS' DEFICIT | Preferred Stock As of June 30, 2020, we had authorized 100,000,000 shares of Preferred Stock, of which certain shares had been designated as Series A Preferred Stock, Series B Preferred Stock, Series C and Series D Preferred Stock. During the six months ended June 30, 2020, the Series A Preferred Stock and the Series B Preferred Stock were reclassified as mezzanine debt as a result of the Company not having enough authorized common shares to be able to issue common shares upon their conversion. Series A Convertible Preferred Stock In February 2015, the Company designated 1,000,000 shares of Preferred Stock as Series A Preferred Stock. The Series A Preferred Stock was designated in February 2016, has a par value of $.001, is redeemable at the Company’s option at $100 per share, is senior to any other class or series of outstanding Preferred Stock or Common Stock and does not bear dividends. The Series A Preferred Stock has a liquidation preference immediately after any Senior Securities, as defined and amended, of an amount equal to amounts payable owing, including contingency amounts where Holders of the Series A have personally guaranteed obligations of the Company. Holders of the Series A Preferred Stock shall, collectively have the right to convert all of their Series A Preferred Stock when conversion is elected into that number of shares of Common Stock of the Company, determined by the following formula: 60% of the issued and outstanding Common Shares as computed immediately after the transaction for conversion. For further clarification, the 60% of the issued and outstanding common shares includes what the holders of the Series A Preferred Stock may already hold in common shares at the time of conversion. The Series A Preferred Stock, collectively, shall have the right to vote as if converted prior to the vote to an number of shares equal to 60% of the outstanding Common Stock of the Company. In February 2015, the Board of Directors authorized the issuance of 1,000,000 shares of Series A Preferred Stock to Stephen Thomas, Chairman, CEO and President of the Company, valued at $3,117,000 for compensation expense. Series B Convertible Preferred Stock In February 2015, the Company designated 3,000,000 shares of Preferred Stock as Series B Convertible Preferred Stock. There are 2,588,693 shares of Series B Convertible Preferred Stock outstanding as of June 30, 2020. The Series B Preferred Stock was designated in February 2015, has a par value of $.001, is not redeemable, is senior to any other class or series of outstanding Preferred Stock, except the Series A Preferred Stock, or Common Stock and does not bear dividends. The Series B Preferred Stock has a liquidation preference immediately after any Senior Securities, as defined and currently the Series A Preferred Stock, and of an amount equal to $2.00 per share. Holders of the Series B Preferred Stock have a right to convert all or any part of the Series B Preferred Shares and will receive and equal number of common shares at the conversion price of $2.00 per share. The Series B Preferred Stockholders have a right to vote on any matter with holders of Common Stock and shall have a number of votes equal to that number of Common Shares on a one to one basis. Series C Convertible Preferred Stock In May 2018, the Company designated 3,000,000 shares of Preferred Stock as Series C Convertible Preferred Stock. There are no shares of Series C Convertible Preferred Stock outstanding as of June 30, 2020. The Series C Preferred Stock was designated in May 2018, has a par value of $.001, is not redeemable, is senior to any other class or series of outstanding Preferred Stock, except the Series A and Series B Preferred Stock, or Common Stock and does not bear dividends. The Series C Preferred Stock has a liquidation preference immediately after any Senior Securities, as defined and currently the Series A and B Preferred Stock, and of an amount equal to $2.00 per share. Holders of the Series C Preferred Stock have a right to convert all or any part of the Series C Preferred Shares and will receive an equal number of common shares at the conversion price of $0.15 per share. The Series C Preferred Stockholders have a right to vote on any matter with holders of Common Stock and shall have a number of votes equal to that number of Common Shares on a one to one basis. Series D Convertible Preferred Stock On June 15, 2020, the Company amended its Series D Designation from January 14, 2020. This Amendment changed the number of shares to 10,000,000 shares of the authorized 100,000,000 shares of the Company's $0.001 par value preferred stock as the Series D Convertible Preferred Stock ("the Series D Preferred Shares.") As of the date hereof, there are no Series D Preferred shares outstanding as amended. Series D Preferred shares have the following features: (i) 6% Cumulative Annual Dividends payable on the purchase value in cash or common stock of the Company at the discretion of the Board and payment is also at the discretion of the Board, which may decide to cumulate to future years; (ii) Any time after 18 months from issuance an option to convert to common stock at the election of the holder 80% of the 30 day average market closing price (for previous 30 business days) divided into $5.00. ; (iii) Automatic conversion of the Series D Preferred Stock shall occur without consent of holders upon any national exchange listing approval and the registration effectiveness of common stock underlying the conversion rights. The automatic conversion to common from Series D Preferred shall be on a one for one basis, which shall be post-reverse split as may be necessary for any Exchange listing (iv) Registration Rights – the Company has granted Piggyback Registration Rights for common stock underlying conversion rights in the event it files any other Registration Statement (other than an S-1 that the Company may file for certain conversion common shares for the convertible note financing that was arranged and funded in 2019). Further, the Company will file, and pursue to effectiveness, a Registration Statement or offering statement for common stock underlying the Automatic Conversion event triggered by an exchange listing. (v) Liquidation Rights - $5.00 per share plus any accrued unpaid dividends – subordinate to Series A, B, and C Preferred Stock receiving full liquidation under the terms of such series. The Company has redemption rights for the first year following the Issuance Date to redeem all or part of the principal amount of the Series D Preferred Stock at between 115% and 140%. Common Stock and Capital Contributions As of June 30, 2020, we had authorized 1,000,000,000 shares of Common Stock, of which 857,562,371 common shares are issued and outstanding. Common Stock Issued for Conversion of Debt During the six months ended June 30, 2020, the Company issued 679,932,432 of common shares for $232,430 of principal and $104,300 of interest, resulting in a loss on extinguishment of $1,252,131. Subscription Payable As of June 30, 2020, the Company has recorded $777,380 in stock subscription payable, which equates to the fair value on the date of commitment, of the Company’s commitment to issue the following common shares: Unissued shares under consulting and director agreements 6,000,000 Unissued shares for conversion of debt 16,667 Unissued shares for acquisition of Bridge Internet 4,000,000 Shares receivable under prior terminated acquisition agreement (3,096,181 ) Net commitment 6,920,486 During the six months ended June 30, 2020, the Company acquired 75% of Bridge Internet for 8,000,000 shares of common stock of TPT Global Tech, Inc., 4,000,000 common shares issued to Sydney “Trip” Camper immediately and 4,000,000 common shares which vest equally over two years. See Note 2. During 2018, a note payable of $2,000 was forgiven for 16,667 common shares. In 2018, Arkady Shkolnik and Reginald Thomas (family member of CEO) were added as members of the Board of Directors. In accordance with agreements with the Company for his services as a director, Mr. Shkolnik is to receive $25,000 per quarter and 5,000,000 shares of restricted common stock valued at approximately $692,500 vesting quarterly over twenty-four months. The quarterly cash payments of $25,000 will be paid in unrestricted common shares if the Company has not been funded adequately to make such payments. Mr. Thomas is to receive $10,000 per quarter and 1,000,000 shares of restricted common stock valued at approximately $120,000 vesting quarterly over twenty-four months. The quarterly payment of $10,000 may be suspended by the Company if the Company has not been adequately funded. As of June 30, 2020, $165,500 and $55,000 has been accrued as accounts payable in the balance sheet for Mr. Shkolnik and Mr. Thomas, respectively. For the six months ended June 30, 2020 and 2019, $203,124 and $203,124, respectively, have been expensed under these agreements. Effective November 1 and 3, 2017, an officer of the Company contributed 9,765,000 shares of restricted Common Stock to the Company for the acquisition of Blue Collar and HRS. These shares were subsequently issued as consideration for these acquisitions in November 2017. In March 2018, the HRS acquisition was rescinded and 3,625,000 shares of common stock are being returned by the recipients. The other transaction involved 6,500,000 shares for the acquisition of Blue Collar which closed in 2018. As such, as of June 30, 2020 the 3,265,000 shares for the HRS transaction are reflected as subscriptions receivable based on their par value. Stock Options Options Outstanding Vested Vesting Period Exercise Price Expiration Date December 31, 2018 3,093,120 1,954,230 100% at issue and 12 to 18 months $ 0.05 to $0.22 12-31-19 to 3-21-21 Expired (93,120 ) $ 0.05 to $0.22 12-31-19 December 31, 2019 3,000,000 3,000,000 12 to 18 months $ 0.10 3-1-20 to 3-21-21 Expired (2,000,000 ) June 30, 2020 1,000,000 1,000,000 12 months $ 0.10 3-1-20 to 3-21-21 During the year ended December 31, 2018, the company entered into consulting arrangements primarily for legal work and general business support that included the issuance of stock options to purchase 3,000,000 options to purchase common shares at $0.10 per share. 2,000,000 of these expired. The remaining 1,000,000 are fully vested as of June 30, 2020. The Black-Scholes options pricing model was used to value the stock options. The inputs included the following: (1) Dividend yield of 0% (2) expected annual volatility of 307% - 311% (3) discount rate of 2.2% to 2.3% (4) expected life of 2 years, and (5) estimated fair value of the Company’s common $0.125 to $0.155 per share. 93,120 options expired in 2019. Expense recorded in the six months ended June 30, 2020 and 2019 was $0 and $113,488 related to stock options. No further expense will be incurred to the consolidated statement of operations for the existing stock options. Warrants As of June 30, 2020, there were 3,333,333 warrants outstanding that expire in five years or in the year ended December 31, 2024. As part of the Convertible Promissory Notes payable – third party issuance in Note 5, the Company issued 3,333,333 warrants to purchase 3,333,333 common shares of the Company at 70% of the current market price. Current market price means the average of the three lowest trading prices for our common stock during the ten-trading day period ending on the latest complete trading day prior to the date of the respective exercise notice. However, if a required registration statement, registering the underlying shares of the Convertible Promissory Notes, is declared effective on or before June 11, 2019 to September 11, 2019, then, while such Registration Statement is effective, the current market price shall mean the lowest volume weighted average price for our common stock during the ten-trading day period ending on the last complete trading day prior to the conversion date. The warrants issued were considered derivative liabilities valued at $30,968 of the total $6,805,480, derivative liabilities as of June 30, 2020. See Note 6. Common Stock Reservations The Company has reserved 1,000,000 shares of Common Stock of the Company for the purpose of raising funds to be used to pay off debt described in Note 5. We have reserved 20,000,000 shares of Common Stock of the Company to grant to certain employee and consultants as consideration for services rendered and that will be rendered to the Company. There are Transfer Agent common stock reservations that have been approved by the Company relative to the outstanding derivative financial instruments, the outstanding Form S-1 Registration Statement and general treasury of 142,437,629. |
COMMITMENTS AND CONTINGENCIES
COMMITMENTS AND CONTINGENCIES | 6 Months Ended |
Jun. 30, 2020 | |
Commitments and Contingencies Disclosure [Abstract] | |
COMMITMENTS AND CONTINGENCIES | Accounts Payable and Accrued Expenses Accounts payable: 2020 2019 Related parties (1) $ 1,094,360 $ 1,141,213 General operating 3,109,190 3,342,952 Accrued interest on debt (2) 1,023,376 793,470 Credit card balances 180,993 183,279 Accrued payroll and other expenses 611,710 207,108 Taxes and fees payable 633,357 633,357 Unfavorable lease liability 181,698 242,256 Total $ 6,834,684 $ 6,543,635 (1) (2) Relates to amounts due to management and members of the Board of Directors according to verbal and written agreements that have not been paid as of period end. Portion relating to related parties is $575,192 and $481,942 for June 30, 2020 and December 31, 2019, respectively. Operating lease obligations We have various non-cancelable lease agreements for certain of our tower locations with original lease periods expiring between 2020 and 2044. Our lease terms may include options to extend or terminate the lease when it is reasonably certain we will exercise that option. Certain of the arrangements contain escalating rent payment provisions. The Company has determined that the identified operating leases did not contain non-lease components and require no further allocation of the total lease cost. Additionally, the agreements in place did not contain information to determine the rate implicit in the leases, so we used our estimated incremental borrowing rate as the discount rate. Our weighted average discount rate is 12.0% and the weighted average lease term of 6 years. Our Michigan main office lease and an equipment lease described below and leases with an initial term of twelve months have not been recorded on the consolidated balance sheets. We recognize rent expense on a straight-line basis over the lease term. As of June 30, 2020, operating lease right-of-use assets and liabilities arising from operating leases were $4,808,632 and $4,929,801, respectively. During the six months ended June 30, 2020, cash paid for amounts included for the measurement of lease liabilities was $1,406,101 and the Company recorded lease expense in the amount of $1,406,101 in costs of goods sold. The following is a schedule showing the future minimum lease payments under operating leases by years and the present value of the minimum payments as of June 30, 2020. 2020 $ 1,177,726 2021 1,920,224 2022 1,299,098 2023 784,887 2024 537,162 Thereafter 318,501 Total operating lease liabilities $ 6,037,598 Amount representing interest $ (1,107,797 ) Total net present value $ 4,929,801 Office lease used by CEO The Company entered into a lease of 12 months or less for living space which is occupied by Stephen Thomas, Chairman, CEO and President of the Company. Mr. Thomas lives in the space and uses it as his corporate office. The company has paid $15,000 and $15,500 in rent and utility payments for this space for the six months ended June 30, 2020 and 2019, respectively. Financing lease obligations Future minimum lease payments are as follows: Obligation 2020 In Default Total Telecom Equipment Finance (1) $ 449,103 — $ 449,103 (1) The Telecom Equipment Lease is with an entity owned and controlled by shareholders of the Company and is due August 31, 2020, as amended. Other Commitments and Contingencies The Company has employment agreements with certain employees of SDM and K Telecom. The agreements are such that SDM and K Telecom, on a standalone basis in each case, must provide sufficient cash flow to financially support the financial obligations within the employment agreements. The Company has been named in a lawsuit by a former employee who was terminated by management in 2016. The employee was working under an employment agreement but was terminated for breach of the agreement. The former employee is suing for breach of contract and is seeking around $75,000 in back pay and benefits. Management believes it has good and meritorious defenses and does not believe the outcome of the lawsuit will have any material effect on the financial position of the Company. As of June 30, 2020, the company has collected $338,725 from one customer in excess of amounts due from that customer in accordance with the customer’s understanding of the appropriate billings activity. The customer has filed a written demand for repayment by the Company of amounts owed. Management believes that the customer agreement allows them to keep the amounts under dispute. Given the dispute, the Company has reflected the amounts in dispute as a customer liability on the consolidated balance sheet as of June 30, 2020 and December 31, 2019 and does not believe the outcome of the dispute will have a material effect on the financial position of the Company. On May 6, 2020, the Company entered into an agreement to employ Ms. Bing Caudle as Vice President of Product Development of the Media One Live platform for an annual salary of $250,000 for five years, including customary employee benefits. The payment is guaranteed for five years whether or not Ms. Caudle is dismissed with cause. |
RELATED PARTY ACTIVITY
RELATED PARTY ACTIVITY | 6 Months Ended |
Jun. 30, 2020 | |
Related Party Transactions [Abstract] | |
RELATED PARTY ACTIVITY | Accounts Payable and Accrued Expenses There are amounts outstanding due to related parties of the Company of $1,094,360 and $1,141,213, respectively, as of June 30, 2020 and December 31, 2019 related to amounts due to employees, management and members of the Board of Directors according to verbal and written agreements that have not been paid as of period end which are included in accounts payable and accrued expenses on the balance sheet. See Note 8. As is mentioned in Note 7, Reginald Thomas was appointed to the Board of Directors of the Company in August 2018. Mr. Thomas is the brother to the CEO Stephen J. Thomas III. According to an agreement with Mr. Reginald Thomas, he is to receive $10,000 per quarter and 1,000,000 shares of restricted common stock valued at approximately $120,000 vesting quarterly over twenty-four months. The quarterly payment of $10,000 may be suspended by the Company if the Company has not been adequately funded. Leases See Note 8 for office lease used by CEO. Debt Financing and Amounts Payable/Receivable As of June 30, 2020, there are amounts due to management/shareholders of $117,850 included in financing arrangements, of which $106,645 is payable from the Company to Stephen J. Thomas III, CEO of the Company. See Note 5. In addition, as of June 30, 2020 and December 31, 2019, amounts receivable from Mark Rowen, CEO of Blue Collar were $7,395 and $0, respectively, consisting of a net balance in advances and reimbursable expenses. Revenue Transactions Blue Collar provided production services to an entity controlled by the Blue Collar CEO (355 LA, LLC or “355”) for which it recorded revenues of $235,150 and $0, respectively, for the six months ended June 30, 2020 and 2019. 355 was formed in October 2019 by the CEO of Blue Collar for the purpose of production of certain additional footage for a 355 customer. 355 has opportunity to engage with other production relationships outside of using Blue Collar. Accounts receivable from 355 as of June 30, 2020 and December 31, 2019 is $0 and $169,439, respectively. Other Agreements On April 17, 2018, the CEO of the Company, Stephen Thomas, signed an agreement with New Orbit Technologies, S.A.P.I. de C.V., a Mexican corporation, (“New Orbit”), majority owned and controlled by Stephen Thomas, related to a license agreement for the distribution of TPT licensed products, software and services related to Lion Phone and ViewMe Live within Mexico and Latin America (“License Agreement”). The License Agreement provides for New Orbit to receive a fully paid-up, royalty-free, non-transferable license for perpetuity with termination only under situations such as bankruptcy, insolvency or material breach by either party and provides for New Orbit to pay the Company fees equal to 50% of net income generated from the applicable activities. The transaction was approved by the Company’s Board of Directors in June 2018. There has been no activity on this agreement. |
GOODWILL AND INTANGIBLE ASSETS
GOODWILL AND INTANGIBLE ASSETS | 6 Months Ended |
Jun. 30, 2020 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
GOODWILL AND INTANGIBLE ASSETS | Goodwill and intangible assets are comprised of the following: June 30, 2020 Gross carrying amount (1) Accumulated Amortization Net Book Value Useful Life Customer Base $ 1,197,200 $ (415,677 ) $ 781,523 3-10 Developed Technology 4,595,600 (1,361,663 ) 3,233,937 9 Film Library 957,000 (141,000 ) 816,000 11 Trademarks and Tradenames 132,000 (20,927 ) 111,073 12 Favorable leases 95,000 (33,920 ) 61,080 3 6,976,800 (1,973,187 ) 5,003,613 Goodwill $ 1,050,366 $ — $ 1,050,366 — Amortization expense was $365,470 and $560,131 for the six months ended June 30, 2020 and 2019, respectively. December 31, 2019 Gross carrying amount (1) Accumulated Amortization Net Book Value Useful Life Customer Base $ 1,197,200 $ (364,383 ) $ 832,817 3-10 Developed Technology 4,595,600 (1,106,351 ) 3,489,249 9 Film Library 957,000 (104,900 ) 852,100 11 Trademarks and Tradenames 132,000 (15,123 ) 116,877 12 Favorable leases 95,000 (16,960 ) 78,040 3 6,976,800 (2,707,717 ) 5,369,083 Goodwill $ 1,050,366 $ — $ 1,050,366 — Remaining amortization of the intangible assets is as following for the next five years and beyond: 2020 2020 $ 356,961 2021 732,431 2022 732,431 2023 729,063 2024 712,079 Thereafter 1,740,648 $ 5,003,613 On May 6, 2020, the Company entered into an agreement with Steve and Yuanbing Caudle for the acquisition of the Media One Live platform for $1,000,000 in the form of a promissory note, non-interest bearing, due after funding has been received by the Company from its various investors and other sources. Mr. Caudle is a principal with the ViewMe technology that is being developed by the Company. This technology is considered to be the social media add on to the ViewMe live streaming engine platform. The Company evaluated this acquisition in accordance with ASC 985-20 Costs of Software to be Sold, Leased or Marketed and concluded that the cost of the acquisition is to be treated as an expense as research and development. |
SEGMENT REPORTING
SEGMENT REPORTING | 6 Months Ended |
Jun. 30, 2020 | |
Segment Reporting [Abstract] | |
SEGMENT REPORTING | ASC 280, “Segment Reporting”, establishes standards for reporting information about operating segments on a basis consistent with the Company's internal organizational structure as well as information about geographical areas, business segments and major customers in financial statements for details on the Company's business segments. The Company's chief operating decision maker (“CODM”) has been identified as the CEO who reviews the financial information of separate operating segments when making decisions about allocating resources and assessing performance of the group. Based on management's assessment, the Company considers its most significant segments for 2020 and 2019 are those in which it is providing Broadband Internet through TPT SpeedConnect and Media Production services through Blue Collar. The following table presents summary information by segment for the six months ended June 30, 2020 and 2019 respectively: 2020 TPT Speed Connect Blue Collar Corporate and other Total Revenue $ 5,264,486 $ 526,092 $ 42,166 $ 5,832,744 Cost of revenue $ 3,228,092 $ 288,838 $ 220,747 $ 3,737,677 Net income (loss) $ 742,373 $ (245,955 ) $ (2,992,406 ) $ (2,495,988 ) Depreciation and amortization $ 239,988 $ 64,946 $ 577,903 $ 882,837 Derivative expense $ — $ — $ 400,019 $ 400,019 Interest expense $ 80,453 $ 19,644 $ 734,004 $ 834,101 2019 TPT Speed Connect Blue Collar Corporate and other Total Revenue $ 1,946,820 $ 464,047 $ 179,064 $ 2,589,931 Cost of revenue $ 1,227,989 $ 304,154 $ 218,173 $ 1,750,316 Net loss $ 186,725 $ (245,349 ) $ (11,466,533 ) $ (11,525,157 ) Depreciation and amortization $ 63,551 $ 10,281 $ 686,006 $ 759,838 Derivative expense $ — $ — $ 8,105,901 $ 8,105,901 Interest expense $ — $ 57,223 $ 1,220,215 $ 1,277,438 |
SUBSEQUENT EVENTS
SUBSEQUENT EVENTS | 6 Months Ended |
Jun. 30, 2020 | |
Subsequent Events [Abstract] | |
SUBSEQUENT EVENTS | Acquisition of The Fitness Container, LLC On June 1, 2020 the Company signed an agreement for the acquisition of a majority interest in San Diego based manufacturing company The Fitness Container, LL dba “Aire Fitness” www.airefitness.com Rennova Subsidiaries Merger with InnovaQor On June 10, 2020, the Company entered into an agreement with Rennova Health, Inc. (“Rennova Health”) The parties anticipate the steps as defined in the agreement to be completed in the 3rd quarter resulting in the target public company being called InnovaQor, Inc. and filing whatever documents are required to be a fully reporting public company. The public company (“InnovaQor”) will own certain assets and technology from TPTW’s proprietary live streaming communication technology and the technology and software developed and owned by HTS and AMSG. The combination of these fully developed assets will facilitate the creation of a next generation telehealth type platform. This platform will combine telehealth with EHR like capabilities and facilitate a patient’s immediate access to healthcare including their local hospital or doctors, for initial consultation, scheduling of appointments and follow on care. Completion of the agreement is subject to a number of approvals and consents which need to be secured to complete the transaction. Subject to the relevant SEC approvals it is intended that TPTW shareholders will receive approximately 5M common shares in InnovaQor. TPTW’s intent is to distribute 2.5M of these common shares to its shareholders at a date to be determined in the future. Rennova Health will receive 1M Class A Supermajority Voting Preferred Shares, as well as 2.2M of Series B non-voting shares, except in certain circumstances, with certain designation rights, lock up agreements and other specifications as outlined in the agreement in return for the equity in HTS and AMSG. All debts and liabilities of HTS and AMSG owed to Rennova Health of approximately $22M will be eliminated as part of the equity issuance in InnovaQor. TPTW will deliver to InnovaQor a standalone backend and front-end telemedicine technology platform utilizing code from TPTW’s TV and Social Media Platform. TPTW is also to grant to InnovaQor a license to utilize and further develop a portion of TPTW’s Streaming Platform to create a telemedicine application for InnovaQor. This is estimated to cost approximately $3.5M, which InnovaQor will pay to TPTW as a licensing deal outlined in the agreement. Rennova Health is a vertically integrated provider of industry-leading diagnostics and supportive software solutions to healthcare providers that has transitioned its core business from diagnostics to rural hospital ownership over the past three years. Software Licensing Agreement On July 10, 2020, the Company entered into a Software Licensing Agreement (“Licensing Agreement”) with its newly formed subsidiary InnovaQor, Inc (“InnovaQor”). The Agreement allows InnovaQor to unitize features from TPTW’s TV and Social Media platform “Viewme Live.” InnovaQor will incorporate streaming features with a Laboratory Information System platform. The Software Licensing Agreement is estimated to cost approximately $3.5M, which funds are anticipated to come from future capital raising activities. The Company also received 5,000,000 common shares of InnovaQor as part of the formation of InnovaQor and Licensing Agreement. The Software Licensing Agreement with InnovaQor is another step to the relationship created recently with Rennova Health, Inc. in which both TPTW and Rennova Health, Inc. are working together to create a telemedicine joint venture announced June 11, 2020, which joint venture is intended to be part of a public company as a vehicle for raising capital InnovaQor Merger with Southern Plains On July 21, 2020, InnovaQor, a wholly-owned subsidiary of the Company, entered into a Merger Agreement with the publicly traded company Southern Plains Oil Corp. (OTCBB: SPLN). Subject to closing conditions which are primarily consents and approvals from SPLN’s Board of Directors, the SPLN Merger moves the Company’s subsidiary InnovaQor one step closer to completing the recently executed Asset Purchase Agreement with Rennova Health Inc. The Merger Agreement when closed, also positions InnovaQor to trade on the OTC Market Exchange once the closing conditions are met, merger is completed, and TPT Global Tech and InnovaQor file for a name change, new trading symbol and receive final approval from the FINRA. After closing of the SPLN Merger, the Company will end up with 5,000,000 common shares out of a total of 5,401,567 common shares to be outstanding. Acquisition of EPIC Reference Labs, Inc. On August 6, 2020, TPT MedTech signed a binding letter of intent with Rennova to acquire EPIC Reference Labs, Inc. (“EPIC”), wholly owned subsidiary of Rennova, for $750,000, comprised of a deposit of $25,000 within five days of signing and the remainder due either from 20% of net proceeds received from fund raising that the Company has initiated and as evidence by SEC Filings or a minimum payment of $25,000 per month until paid in full. The first $25,000 payment under the second option will be payable in September 2020. All defined laboratory equipment and a $100,000 lease deposit were excluded from the sales price. All liabilities incurred up to signing are to be discharged. Receivables existing at signing are to be 100% ownership of Rennova. There are no other significant assets. This acquisition will allow TPT MedTech to own a license to operate medical testing facilities. Subsequent events were reviewed through the date the financial statements were issued. |
DESCRIPTION OF BUSINESS AND S_2
DESCRIPTION OF BUSINESS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Policies) | 6 Months Ended |
Jun. 30, 2020 | |
Accounting Policies [Abstract] | |
Nature of Operations | The Company was originally incorporated in 1988 in the state of Florida. TPT Global, Inc., a Nevada corporation formed in June 2014, merged with Ally Pharma US, Inc., a Florida corporation, (“Ally Pharma”, formerly known as Gold Royalty Corporation) in a “reverse merger” wherein Ally Pharma issued 110,000,000 shares of Common Stock, or 80% ownership, to the owners of TPT Global, Inc. in exchange for all outstanding common stock of TPT Global Inc. and Ally Pharma agreed to change its name to TPT Global Tech, Inc. (jointly referred to as “the Company” or “TPTG”). The following acquisitions have resulted in entities which have been consolidated into TPTG. In 2014 the Company acquired all the assets of K Telecom and Wireless LLC (“K Telecom”) and Global Telecom International LLC (“Global Telecom”). Effective January 31, 2015, TPTG completed its acquisition of 100% of the outstanding stock of Copperhead Digital Holdings, Inc. (“Copperhead Digital”) and Subsidiaries, TruCom, LLC (“TruCom”), Nevada Utilities, Inc. (“Nevada Utilities”) and CityNet Arizona, LLC (“CityNet”). Effective September 30, 2016, the company acquired 100% ownership in San Diego Media Inc. (“SDM”). In October 2017, we entered into agreements to acquire Blue Collar, Inc. (“Blue Collar”) which closed as of September 1, 2018. On May 7, 2019 we completed the acquisition of a majority of the assets of SpeedConnect, LLC, which assets were conveyed into our wholly owned subsidiary TPT SpeedConnect, LLC (“TPT SC” or “TPT SpeedConnect”) which was formed on April 16, 2019. On January 8, 2020 we formed TPT Federal, LLC (“TPT Federal”), on March 7, 2020 we acquired 75% interest in Bridget Internet, LLC (“Bridge Internet” or “BIC”), On March 30, 2020 we formed TPT MedTech, LLC (“TPT MedTech”) and on June 6, 2020 we formed InnovaQor, Inc (“InnovaQor”). We are based in San Diego, California, and operate as a Media Content Hub for Domestic and International syndication Technology/Telecommunications company operating on our own proprietary Global Digital Media TV and Telecommunications infrastructure platform and also provide technology solutions to businesses domestically and worldwide. We are a rural Broadband Wireless Access (BWA) provider, Software as a Service (SaaS), Technology Platform as a Service (PAAS), Cloud-based Unified Communication as a Service (UCaaS) and carrier-grade performance and support for businesses over our private IP MPLS fiber and wireless network in the United States. Our cloud-based UCaaS services allow businesses of any size to enjoy all the latest voice, data, media and collaboration features in today's global technology markets. We also operate as a Master Distributor for Nationwide Mobile Virtual Network Operators (MVNO) and Independent Sales Organization (ISO) as a Master Distributor for Pre-Paid Cellphone services, Mobile phones, Cellphone Accessories and Global Roaming Cellphones. In addition, we create media marketing materials and content. |
Significant Accounting Policies | Please refer to Note 1 of the Notes to the Consolidated Financial Statements in the Company's most recent Form 10-K for all significant accounting policies of the Company, with the exception of those discussed below. |
Basis of Presentation | The accompanying unaudited condensed consolidated financial statements have been prepared according to the instructions to Form 10-Q and Section 210.8-03(b) of Regulation S-X of the Securities and Exchange Commission (“SEC”) and, therefore, certain information and footnote disclosures normally included in financial statements prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”) have been omitted. In the opinion of management, all adjustments (consisting of normal recurring accruals) considered necessary for a fair presentation have been included. Operating results for the three and six months ended June 30, 2020 are not necessarily indicative of the results that may be expected for the year ending December 31, 2020. These condensed consolidated financial statements should be read in conjunction with the Company’s consolidated financial statements for the year ended December 31, 2019. The condensed consolidated balance sheet at June 30, 2020, has been derived from the consolidated financial statements at that date, but does not include all of the information and footnotes required by GAAP. Our condensed consolidated financial statements include the accounts of K Telecom, Copperhead Digital, SDM, Blue Collar, TPT SpeedConnect, BIC, TPT Federal, TPT MedTech and InnovaQor. All intercompany accounts and transactions have been eliminated in consolidation. Consideration has also been given to the minority interest of 25% in BIC. |
Revenue Recognition | On January 1, 2018, we adopted the new accounting standard ASC 606, Revenue from Contracts with Customers Identify the contract with the customer Identify the performance obligations in the contract Determine the transaction price Allocate the transaction price to performance obligations in the contract Recognize revenue when or as we satisfy a performance obligation. Reserves are recorded as a reduction in net sales and are not considered material to our consolidated statements of income for the six months ended June 30, 2020 and 2019. In addition, we invoice our customers for taxes assessed by governmental authorities such as sales tax and value added taxes, where applicable. We present these taxes on a net basis. The Company’s revenue generation for the six months ended June 30, 2020 and 2019 came from the following sources disaggregated by services and products, which sources are explained in detail below. For the six months ended June 30, 2020 For the six months ended June 30, 2019 TPT SpeedConnect $ 5,264,486 $ 1,946,820 Copperhead Digital — 128,130 K Telecom 28,091 33,769 San Diego Media 7,365 17,165 Blue Collar 526,092 464,047 Other 6,710 — Total Revenue $ 5,832,744 $ 2,589,931 TPT SpeedConnect: ISP and Telecom Revenue TPT SpeedConnect is a rural Internet provider operating in 10 Midwestern States under the trade name SpeedConnect. TPT SC’s primary business model is subscription based, pre-paid monthly reoccurring revenues, from wireless delivered, high-speed internet connections. In addition, the company resells third-party satellite and DSL internet and IP telephony services. Revenue generated from sales of telecommunications services is recognized as the transaction with the customer is considered closed and the customer receives and accepts the services that were the result of the transaction. There are no financing terms or variable transaction prices. Due date is detailed on monthly invoices distributed to customer. Services billed monthly in advance are deferred to the proper period as needed. Deferred revenue are contract liabilities for cash received before performance obligations for monthly services are satisfied. Deferred revenue at June 30, 2020 and December 31, 2019 are $335,109 and $305,741, respectively. Certain of our products require specialized installation and equipment. For telecom products that include installation, if the installation meets the criteria to be considered a separate element, product revenue is recognized upon delivery, and installation revenue is recognized when the installation is complete. The Installation Technician collects the signed quote containing terms and conditions when installing the site equipment at customer premises. Revenue for installation services and equipment is billed separately from recurring ISP and telecom services and is recognized when equipment is delivered and installation is completed. Revenue from ISP and telecom services is recognized monthly over the contractual period, or as services are rendered and accepted by the customer. The overwhelming majority of our revenue continues to be recognized when transactions occur. Since installation fees are generally small relative to the size of the overall contract and because most contracts are for two years or less, the impact of not recognizing installation fees over the contract is immaterial. Copperhead Digital: ISP and Telecom Revenue Copperhead Digital is a regional internet and telecom services provider operating in Arizona under the trade name Trucom. Copperhead Digital operates as a wireless telecommunications Internet Service Provider (“ISP”) facilitating both residential and commercial accounts. Copperhead Digital’s primary business model is subscription based, pre-paid monthly reoccurring revenues, from wireless delivered, high-speed internet connections. In addition, the company resells third-party satellite and DSL internet and IP telephony services. Revenue generated from sales of telecommunications services is recognized as the transaction with the customer is considered closed and the customer receives and accepts the services that were the result of the transaction. There are no financing terms or variable transaction prices. Due date is detailed on monthly invoices distributed to customer. Services billed monthly in advance are deferred to the proper period as needed. Deferred revenue are contract liabilities for cash received before performance obligations for monthly services are satisfied. Certain of our products require specialized installation and equipment. For telecom products that include installation, if the installation meets the criteria to be considered a separate element, product revenue is recognized upon delivery, and installation revenue is recognized when the installation is complete. The Installation Technician collects the signed quote containing terms and conditions when installing the site equipment at customer premises. Revenue for installation services and equipment is billed separately from recurring ISP and telecom services and is recognized when equipment is delivered and installation is completed. Revenue from ISP and telecom services is recognized monthly over the contractual period, or as services are rendered and accepted by the customer. The overwhelming majority of our revenue continues to be recognized when transactions occur. Since installation fees are generally small relative to the size of the overall contract and because most contracts are for a year or less, the impact of not recognizing installation fees over the contract is immaterial. K Telecom: Prepaid Phones and SIM Cards Revenue K Telecom generates revenue from reselling prepaid phones, SIM cards, and rechargeable minute traffic for prepaid phones to its customers (primarily retail outlets). Product sales occur at the customer’s locations, at which time delivery occurs and cash or check payment is received. The Company recognizes the revenue when they receive payment at the time of delivery. There are no financing terms or variable transaction prices. SDM: Ecommerce, Email Marketing and Web Design Services SDM generates revenue by providing ecommerce, email marketing and web design solutions to small and large commercial businesses, complete with monthly software support, updates and maintenance. Services are billed monthly. There are no financing terms or variable transaction prices. Platform infrastructure support is a prepaid service billed in monthly recurring increments. The services are billed a month in advance and due prior to services being rendered. The revenue is deferred when invoiced and booked in the month the service is provided. There is no deferred revenue at June 30, 2020 and December 31, 2019. Software support services (including software upgrades) are billed in real time, on the first of the month. Web design service revenues are recognized upon completion of specific projects. Revenue is booked in the month the services are rendered and payments are due on the final day of the month. There are usually no contract revenues that are deferred until services are performed. Blue Collar: Media Production Services Blue Collar creates original live action and animated content productions and has produced hundreds of hours of material for the television, theatrical, home entertainment and new media markets. Blue Collar designs branding and marketing campaigns and has had agreements with some of the world’s largest companies including PepsiCo, Intel, HP, WalMart and many other Fortune 500 companies. Additionally, they create motion picture, television and home entertainment marketing campaigns for studios including Sony, DreamWorks, Twentieth Century Fox, Universal Studios, Paramount Studios, and Warner Brothers. With regard to revenue recognition, Blue Collar receives an agreement from each client to perform defined work. Some agreements are written, some are verbal. Work may include creation of marketing materials and/or content creation. Some work may be short term and take weeks to create and some work may be longer and take months to create. There are instances where customer agreements segregate identifiable obligations (like filming on site vs. film editing and final production) with separate transaction pricing. The performance obligation is generally satisfied upon delivery of such film or production products, at which time revenue is recognized. There are no financing terms or variable transaction prices. |
Basic and Diluted Net Loss Per Share | The Company computes net income (loss) per share in accordance with ASC 260, “Earning per Share”. ASC 260 requires presentation of both basic and diluted earnings per share (“EPS”) on the face of the income statement. Basic EPS is computed by dividing net income (loss) available to common shareholder (numerator) by the weighted average number of shares outstanding (denominator) during the period. Diluted EPS gives effect to all dilutive potential common shares outstanding during the period using the treasury stock method for options and warrants and using the if-converted method for preferred stock and convertible notes. In computing diluted EPS, the average stock price for the period is used in determining the number of shares assumed to be purchased from the exercise of stock options or warrants. Diluted EPS excludes all dilutive potential shares if their effect is anti-dilutive. As of June 30, 2020, the Company had shares that were potentially common stock equivalents as follows: 2020 Convertible Promissory Notes 1,201,118,785 Series A Preferred Stock (1) 1,219,627,539 Series B Preferred Stock 2,588,693 Stock Options and Warrants 4,333,333 2,427,668,350 (1) Holder of the Series A Preferred Stock which is Stephen J. Thomas, is guaranteed 60% of outstanding common stock upon conversion. The Company would have to authorize additional shares for this to occur as only 1,000,000,000 shares are currently authorized. |
Financial Instruments and Fair Value of Financial Instruments | Our primary financial instruments at June 30, 2020 and December 31, 2019 consisted of cash equivalents, accounts receivable, accounts payable, notes payable and derivative liabilities. We apply fair value measurement accounting to either record or disclose the value of our financial assets and liabilities in our financial statements. Fair value is defined as the exchange price that would be received for an asset or paid to transfer a liability (an exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date. A fair value hierarchy requires an entity to maximize the use of observable inputs, where available, and minimize the use of unobservable inputs when measuring fair value. Described below are the three levels of inputs that may be used to measure fair value: Level 1 Level 2 Level 3 We consider our derivative financial instruments as Level 3. The balances for our derivative financial instruments as of June 30, 2020 are the following: Derivative Instrument Fair Value Fair value of Auctus Convertible Promissory Note $ 5,423,940 Fair value of EMA Financial Convertible Promissory Note 1,350,573 Fair value of Warrants issued with the derivative instruments 30,967 $ 6,805,480 |
Principles of Consolidation | Our consolidated financial statements include the wholly-owned accounts of K Telecom and Global, Copperhead Digital, SDM, Blue Collar, TPT SpeedConnect, TPT Federal, TPT MedTech, and InnovaQor. The consolidated financial statements also include the accounts of Bridge Internet and as they become material will present the effects of a 25% noncontrolling interest. All intercompany accounts and transactions have been eliminated in consolidation. |
Use of Estimates | The preparation of financial statements in conformity with United States generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, disclosures of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ materially from those estimates. The Company’s consolidated financial statements reflect all adjustments that management believes are necessary for the fair presentation of their financial condition and results of operations for the periods presented. |
Recently Adopted Accounting Pronouncements | In June 2018, the FASB issued ASU No. 2018-07, Improvements to Nonemployee Share-Based Payment Accounting, which amends ASC 718, Compensation – Stock Compensation. This ASU requires that most of the guidance related to stock compensation granted to employees be followed for non-employees, including the measurement date, valuation approach, and performance conditions. The expense is recognized in the same period as though cash were paid for the good or service. The effective date is the first quarter of fiscal year 2020, with early adoption permitted, including in interim periods. The ASU has been adopted using a modified-retrospective transition approach. The adoption did not have a material effect on the consolidated financial statements. Management has reviewed other recently issued accounting pronouncements and have determined there are not any that would have a material impact on the condensed consolidated financial statements. |
DESCRIPTION OF BUSINESS AND S_3
DESCRIPTION OF BUSINESS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Tables) | 6 Months Ended |
Jun. 30, 2020 | |
Accounting Policies [Abstract] | |
Disaggregation of revenue | For the six months ended June 30, 2020 For the six months ended June 30, 2019 TPT SpeedConnect $ 5,264,486 $ 1,946,820 Copperhead Digital — 128,130 K Telecom 28,091 33,769 San Diego Media 7,365 17,165 Blue Collar 526,092 464,047 Other 6,710 — Total Revenue $ 5,832,744 $ 2,589,931 |
Potentially dilutive securities | 2020 Convertible Promissory Notes 1,201,118,785 Series A Preferred Stock (1) 1,219,627,539 Series B Preferred Stock 2,588,693 Stock Options and Warrants 4,333,333 2,427,668,350 (1) Holder of the Series A Preferred Stock which is Stephen J. Thomas, is guaranteed 60% of outstanding common stock upon conversion. The Company would have to authorize additional shares for this to occur as only 1,000,000,000 shares are currently authorized. |
Derivative financial instruments | Derivative Instrument Fair Value Fair value of Auctus Convertible Promissory Note $ 5,423,940 Fair value of EMA Financial Convertible Promissory Note 1,350,573 Fair value of Warrants issued with the derivative instruments 30,967 $ 6,805,480 |
ACQUISITIONS (Tables)
ACQUISITIONS (Tables) | 6 Months Ended |
Jun. 30, 2020 | |
Business Combinations [Abstract] | |
Purchase price allocation | TPT Global Tech Effective May 7, 2019 Purchaser TPT Global Tech Consideration Given: Cash paid $ 1,000,000 Liabilities: Promissory Note $ 750,000 Deferred revenue 230,000 Operating lease liabilities 5,162,077 Unfavorable leases 323,000 Accounts and other payables 591,964 Total liabilities $ 7,057,041 Total Consideration Value $ 8,057,041 Assets Acquired: Customer base $ 350,000 Current assets: Cash 201,614 Prepaid and other receivables 99,160 Deposits 13,190 Operating lease right of use asset 5,162,077 Favorable leases 95,000 Property and equipment 1,939,000 Total Assets Acquired $ 7,860,041 Goodwill $ 197,000 |
Proforma results | 2019 Revenue $ 7,352,758 Cost of Sales 4,754,166 Gross Profit $ 2,598,592 Expenses (4,514,097 ) Derivative Expense (8,105,901 ) Interest Expense (1,277,438 ) Income Taxes — Net Loss $ (11,298,844 ) Loss per share $ (0.08 ) |
PROPERTY AND EQUIPMENT (Tables)
PROPERTY AND EQUIPMENT (Tables) | 6 Months Ended |
Jun. 30, 2020 | |
Property, Plant and Equipment [Abstract] | |
Property and equipment | 2020 2019 Property and equipment: Telecommunications fiber and equipment $ 5,421,920 5,203,000 Film production equipment 369,903 369,903 Office furniture and equipment 86,899 85,485 Medical equipment 50,805 — Leasehold improvements 18,679 18,679 Accumulated depreciation (1,771,286 ) (1,253,919 ) Property and equipment, net $ 4,176,920 4,423,148 |
DEBT FINANCING ARRANGEMENTS (Ta
DEBT FINANCING ARRANGEMENTS (Tables) | 6 Months Ended |
Jun. 30, 2020 | |
Debt Disclosure [Abstract] | |
Debt financing arrangements | 2020 2019 Business loans and advances (1) $ 2,284,196 1,121,640 Convertible notes payable (2) 1,711,098 2,101,649 Factoring agreements (3) 470,874 223,618 Debt – third party $ 4,466,168 3,446,907 Line of credit, related party secured by assets (4) $ 3,043,390 3,043,390 Debt– other related party, net of discounts (5) 6,950,000 5,950,000 Convertible debt – related party (6) 922,881 922,881 Shareholder debt (7) 117,850 303,688 Debt – related party $ 11,034,121 10,219,959 Total financing arrangements $ 15,500,289 13,666,866 Less current portion: Loans, advances and agreements – third party $ (1,794,497 ) (344,758 ) Convertible notes payable third party (1,711,098 ) (2,101,649 Debt – related party, net of discount (10,111,240 ) (9,297,078 ) Convertible notes payable– related party (781,581 ) (534,381 ) (14,398,416 ) (12,277,866 ) Total long term debt $ 1,101,873 1,389,000 (1) The terms of $40,000 of this balance are similar to that of the Line of Credit which bears interest at adjustable rates, 1 month Libor plus 2%, 2.2% as of June 30, 2020, and is secured by assets of the Company, is due August 31, 2020, as amended, and included 8,000 stock options as part of the terms which options expired December 31, 2019 (see Note 7). $500,500 is a line of credit that Blue Collar has with a bank, bears interest at Prime plus 1.125%, 4.38% as of June 30, 2020, and is due March 25, 2021. $480,954 is a bank loan dated May 28, 2019 which bears interest at Prime plus 6%, 9.25% as of June 30, 2020, is interest only for the first year, thereafter beginning in June of 2020 payable monthly of principal and interest of $22,900 until the due date of May 1, 2022. The bank loan is collateralized by assets of the Company. $722,219 represents loans under the COVID-19 Pandemic Paycheck Protection Program (“PPP”) originated in April of 2020. The Company believes that it has used the funds such that 100% will be forgiven when it applies for forgiveness in the third or fourth quarter of 2020. $119,371 of this amount relates to a PPP loan for Blue Collar which falls under the automatic forgiveness provisions approved by Congress of all loans under $150,000. If any of the PPP loans are not forgiven then, per the PPP, the unforgiven loan amounts will be payable monthly over a five year period of which payment are to begin no later than 10 months after the covered period as defined at a 2% annual interest rate. On June 4, 2019, the Company consummated a Securities Purchase Agreement with Odyssey Capital Funding, LLC. (“Odyssey”) for the purchase of a $525,000 Convertible Promissory Note (“Odyssey Convertible Promissory Note”). The Odyssey Convertible Promissory Note was due June 3, 2020, paid interest at the rate of 12% ( 24% default) per annum and gave the holder the right from time to time, and at any time during the period beginning six months from the issuance date to convert all of the outstanding balance into common stock of the Company limited to 4.99% of the outstanding common stock of the Company. The conversion price was 55% multiplied by the average of the two lowest trading prices for the common stock during the previous 20 trading days prior to the applicable conversion date. The Odyssey Convertible Promissory Note could be prepaid in full at 125% to 145% up to 180 days from origination. Through June 3, 2020, Odyssey converted $49,150 of principal and $4,116 of accrued interest into 52,961,921 shares of common stock of the Company. On June 8, 2020, Odyssey agreed to convert the remaining principal and accrued interest balance on the Odyssey Convertible Promissory Note of $475,850 and $135,000, respectively, to a term loan payable in six months in the form of a balloon payment, earlier if the Company has a funding event, bearing simple interest on the unpaid balance of 0% for the first three months and then 10% per annum thereafter. The remaining balances generally bear interest at approximately 10%, have maturity dates that are due on demand or are past due, are unsecured and are classified as current in the balance sheets. (2) During 2017, the Company issued convertible promissory notes in the amount of $67,000 (comprised of $62,000 from two related parties and $5,000 from a former officer of CDH), all which were due May 1, 2020 and bear 6% annual interest (12% default interest rate). The convertible promissory notes are convertible, as amended, at $0.25 per share. These convertible promissory notes were not repaid May 1, 2020. Management is working to extend the due dates. During 2019, the Company consummated Securities Purchase Agreements dated March 15, 2019, April 12, 2019, May 15, 2019, June 6, 2019 and August 22, 2019 with Geneva Roth Remark Holdings, Inc. (“Geneva Roth”) for the purchase of convertible promissory notes in the amounts of $68,000, $65,000, $58,000, $53,000 and $43,000 (“Geneva Roth Convertible Promissory Notes”). The Geneva Roth Convertible Promissory Notes are due one year from issuance, pays interest at the rate of 12% (principal amount increases 150%-200% and interest rate increases to 24% under default) per annum and gives the holder the right from time to time, and at any time during the period beginning 180 days from the origination date to the maturity date or date of default to convert all or any part of the outstanding balance into common stock of the Company limited to 4.99% of the outstanding common stock of the Company. The conversion price is 61% multiplied by the average of the two lowest trading prices for the common stock during the previous 20 trading days prior to the applicable conversion date. The Geneva Roth Convertible Promissory Notes may be prepaid in whole or in part of the outstanding balance at 125% to 140% up to 180 days from origination. Geneva Roth converted a total of $244,000 of principal and $8,680 of accrued interest through June 30, 2020 from its various Securities Purchase Agreements into 125,446,546 shares of common stock of the Company leaving no outstanding principal balances as of June 30, 2020. On February 13, 2020, the August 22, 2019 Securities Purchase Agreement was repaid for $63,284, including a premium and accrued interest. On March 25, 2019, the Company consummated a Securities Purchase Agreement dated March 18, 2019 with Auctus Fund, LLC. (“Auctus”) for the purchase of a $600,000 Convertible Promissory Note (“Auctus Convertible Promissory Note”). The Auctus Convertible Promissory Note is due December 18, 2019, pays interest at the rate of 12% (24% default) per annum and gives the holder the right from time to time, and at any time during the period beginning 180 days from the origination date or at the effective date of the registration of the underlying shares of common stock, which the holder has registration rights for, to convert all of the outstanding balance into common stock of the Company limited to 4.99% of the outstanding common stock of the Company. The conversion price is the lessor of the lowest trading price during the previous 25 trading days prior the date of the Auctus Convertible Promissory Note or 50% multiplied by the average of the two lowest trading prices for the common stock during the previous 25 trading days prior to the applicable conversion date. The Auctus Convertible Promissory Note may be prepaid in full at 135% to 150% up to 180 days from origination. Auctus converted $33,180 of principal and $142,004 of accrued interest into 376,000,000 shares of common stock of the Company prior to June 30, 2020. 2,000,000 warrants were issued in conjunction with the issuance of this debt. See Note 7. On June 6, 2019, the Company consummated a Securities Purchase Agreement with JSJ Investments Inc. (“JSJ”) for the purchase of a $112,000 Convertible Promissory Note (“JSJ Convertible Promissory Note”). The JSJ Convertible Promissory Note is due June 6, 2020, pays interest at the rate of 12% per annum and gives the holder the right from time to time, and at any time during the period beginning 180 days from the origination date to convert all of the outstanding balance into common stock of the Company limited to 4.99% of the outstanding common stock of the Company. The conversion price is the lower of the market price, as defined, or 55% multiplied by the average of the two lowest trading prices for the common stock during the previous 20 trading days prior to the applicable conversion date. The JSJ Convertible Promissory Note may be prepaid in full at 135% to 150% up to 180 days from origination. JSJ converted $43,680 of principal into 18,500,000 shares of common stock of the Company prior to June 30, 2020. In addition, on February 25, 2020 the Company repaid for $97,000, including a premium and accrued interest, for all remaining principal and accrued interest balances as of that day. 333,333 warrants were issued in conjunction with the issuance of this debt. See Note 7. On June 11, 2019, the Company consummated a Securities Purchase Agreement with EMA Financial, LLC. (“EMA”) for the purchase of a $250,000 Convertible Promissory Note (“EMA Convertible Promissory Note”). The EMA Convertible Promissory Note is due June 11, 2020, pays interest at the rate of 12% (principal amount increases 200% and interest rate increases to 24% under default) per annum and gives the holder the right from time to time to convert all of the outstanding balance into common stock of the Company limited to 4.99% of the outstanding common stock of the Company. The conversion price is 55% multiplied by the lowest traded price for the common stock during the previous 25 trading days prior to the applicable conversion date. The EMA Convertible Promissory Note may be prepaid in full at 135% to 150% up to 180 days from origination. Prior to June 30, 2020, EMA converted $35,366 of principal into 147,700,000 shares of common stock of the Company. 1,000,000 warrants were issued in conjunction with the issuance of this debt. See Note 7. The Company is in default under its derivative financial instruments and received notice of such from Auctus and EMA for not reserving enough shares for conversion and for not having filed a Form S-1 Registration Statement with the Securities and Exchange Commission. It was the intent of the Company to pay back all derivative securities prior to the due dates but that has not occurred in case of Auctus or EMA. As such, the Company is currently in negotiations with Auctus and EMA and relative to extending due dates and changing terms on the Notes. On February 14, 2020, the Company agreed to a Secured Promissory Note with a third party for $90,000. The Secured Promissory Note was secured by the assets of the Company and was due June 14, 2020 or earlier in case the Company is successful in raising other monies and carried an interest charge of 10% payable with the principal. The Secured Promissory Note was also convertible at the option of the holder into an equivalent amount of Series D Preferred Stock. The Secured Promissory Note also included a guaranty by the CEO of the Company, Stephen J. Thomas III. This Secured Promissory Note was paid off in June 2020, including $9,000 of interest in June and $1,000 in July 2020. (3) The Factoring Agreement with full recourse, due February 29, 2020, as amended, was established in June 2016 with a company that is controlled by a shareholder and is personally guaranteed by an officer of the Company. The Factoring Agreement is such that the Company pays a discount of 2% per each 30-day period for each advance received against accounts receivable or future billings. The Company was advanced funds from the Factoring Agreement for which $101,244 and $101,244 in principal remained unpaid as of June 30, 2020 and December 31, 2019, respectively. On May 8, 2019, the Company entered into a factoring agreement with Advantage Capital Funding (“2019 Factoring agreement”). $500,000, net of expenses, was funded to the Company with a promise to pay $18,840 per week for 40 weeks until a total of $753,610 is paid which occurred in February 2020. On February 25, 2020, the Company entered into an Agreement for the Purchase and Sale of Future Receipts (“2020 Factoring Agreement”). The balance to be purchased and sold is $716,720 for which the Company received $500,000, net of fees. Under the 2020 Factoring Agreement, the Company was to pay $14,221 per week for 50 weeks at an effective interest rate of approximately 43% annually. However, due to COVID-19 the payments under the 2020 Factoring Agreement were reduced temporarily, to between $9,000 and $10,500 weekly, of which $54,360 in payments have been deferred to be paid at the end of the 50-week term. The 2020 Factoring Agreement includes a guaranty by the CEO of the Company, Stephen J. Thomas III. (4) The Line of Credit originated with a bank and was secured by the personal assets of certain shareholders of Copperhead Digital. During 2016, the Line of Credit was assigned to the Copperhead Digital shareholders, who subsequent to the Copperhead Digital acquisition by TPTG became shareholders of TPTG, and the secured personal assets were used to pay off the bank. The Line of Credit bears a variable interest rate based on the 1 Month LIBOR plus 2.0%, 2.16% as of June 30, 2020, is payable monthly, and is secured by the assets of the Company. 1,000,000 shares of Common Stock of the Company have been reserved to accomplish raising the funds to pay off the Line of Credit. Since assignment of the Line of Credit to certain shareholders, which balance on the date of assignment was $2,597,790, those shareholders have loaned the Company $445,600 under the similar terms and conditions as the line of credit but most of which were also given stock options totaling $85,120 which expired as of December 31, 2019 (see Note 7) and is due, as amended, August 31, 2020. During the year ended December 31, 2019 and 2018, those same shareholders and one other have loaned the Company money in the form of convertible loans of $136,400 and $537,200, respectively, described in (2) and (6). (5) $350,000 represents cash due to the prior owners of the technology acquired in December 2016 from the owner of the Lion Phone which is due to be paid as agreed by TPTG and the former owners of the Lion Phone technology and has not been determined. $4,000,000 represents a promissory note included as part of the consideration of ViewMe Live technology acquired in 2017, later agreed to as being due and payable in full, with no interest with $2,000,000 from debt proceeds and the remainder from proceeds from the second Company public offering. $1,000,000 represents a promissory note which was entered into on May 6, 2020 for the acquisition of Media Live One Platform from . This $1,000,000 promissory note is On September 1, 2018, the Company closed on its acquisition of Blue Collar. Part of the acquisition included a promissory note of $1,600,000 and interest at 3% from the date of closure. The promissory note is secured by the assets of Blue Collar. (6) During 2016, the Company acquired SDM which consideration included a convertible promissory note for $250,000 due February 29, 2019, as amended, does not bear interest, unless delinquent in which the interest is 12% per annum, and is convertible into common stock at $1.00 per share. The SDM balance is $182,381 as of June 30, 2020. As of March 1, 2020, this convertible promissory note is delinquent. During 2018, the Company issued convertible promissory notes in the amount of $537,200 to related parties and $10,000 to a non-related party which bear interest at 6% (11% default interest rate), are due 30 months from issuance and are convertible into Series C Preferred Stock at $1.00 per share. Because the Series C Preferred Stock has a conversion price of $0.15 per share, the issuance of Series C Preferred Stock promissory notes will cause a beneficial conversion feature of approximately $38,479 upon exercise of the convertible promissory notes. (7) The shareholder debt represents funds given to TPTG or subsidiaries by officers and managers of the Company as working capital. There are no written terms of repayment or interest that is being accrued to these amounts and they will only be paid back, according to management, if cash flows support it. They are classified as current in the balance sheets. See Lease financing arrangement in Note 8. |
DERIVATIVE FINANCIAL INSTRUME_2
DERIVATIVE FINANCIAL INSTRUMENTS (Tables) | 6 Months Ended |
Jun. 30, 2020 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
Changes in fair value of Company's Level 3 financial liabilities | Debt Derivative Liabilities Balance, December 31, 2018 $ — Debt discount from initial derivative 1,774,000 Initial fair value of derivative liabilities 2,601,631 Change in derivative liability from conversion of notes payable (407,654 ) Change in fair value of derivative liabilities at end of period 4,868,537 Balance, December 31, 2019 $ 8,836,514 Change in derivative liabilities from conversion of notes payable (1,144,290 ) Change in derivative liabilities from the Odyssey conversion to a term loan (1,286,763 ) Change in fair value of derivative liabilities at end of period 400,019 Balance, June 30, 2020 $ 6,805,480 Derivative expense for the six months ended June 30, 2020 $ 400,019 |
STOCKHOLDERS' DEFICIT (Tables)
STOCKHOLDERS' DEFICIT (Tables) | 6 Months Ended |
Jun. 30, 2020 | |
STOCKHOLDERS' DEFICIT | |
Subscription payable | Unissued shares under consulting and director agreements 6,000,000 Unissued shares for conversion of debt 16,667 Unissued shares for acquisition of Bridge Internet 4,000,000 Shares receivable under prior terminated acquisition agreement (3,096,181 ) Net commitment 6,920,486 |
Stock option activity | Options Outstanding Vested Vesting Period Exercise Price Expiration Date December 31, 2018 3,093,120 1,954,230 100% at issue and 12 to 18 months $ 0.05 to $0.22 12-31-19 to 3-21-21 Expired (93,120 ) $ 0.05 to $0.22 12-31-19 December 31, 2019 3,000,000 3,000,000 12 to 18 months $ 0.10 3-1-20 to 3-21-21 Expired (2,000,000 ) June 30, 2020 1,000,000 1,000,000 12 months $ 0.10 3-1-20 to 3-21-21 |
Stock options, valuation assumptions | (1) Dividend yield of 0% (2) expected annual volatility of 307% - 311% (3) discount rate of 2.2% to 2.3% (4) expected life of 2 years, and (5) estimated fair value of the Company’s common $0.125 to $0.155 per share. |
COMMITMENTS AND CONTINGENCIES (
COMMITMENTS AND CONTINGENCIES (Tables) | 6 Months Ended |
Jun. 30, 2020 | |
Commitments and Contingencies Disclosure [Abstract] | |
Accounts payable and accrued expenses | Accounts payable: 2020 2019 Related parties (1) $ 1,094,360 $ 1,141,213 General operating 3,109,190 3,342,952 Accrued interest on debt (2) 1,023,376 793,470 Credit card balances 180,993 183,279 Accrued payroll and other expenses 611,710 207,108 Taxes and fees payable 633,357 633,357 Unfavorable lease liability 181,698 242,256 Total $ 6,834,684 $ 6,543,635 (1) (2) Relates to amounts due to management and members of the Board of Directors according to verbal and written agreements that have not been paid as of period end. Portion relating to related parties is $575,192 and $481,942 for June 30, 2020 and December 31, 2019, respectively. |
Maturity of lease liabilities | 2020 $ 1,177,726 2021 1,920,224 2022 1,299,098 2023 784,887 2024 537,162 Thereafter 318,501 Total operating lease liabilities $ 6,037,598 Amount representing interest $ (1,107,797 ) Total net present value $ 4,929,801 |
Future minimum lease payments | Obligation 2020 In Default Total Telecom Equipment Finance (1) $ 449,103 — $ 449,103 (1) The Telecom Equipment Lease is with an entity owned and controlled by shareholders of the Company and is due August 31, 2020, as amended. |
GOODWILL AND INTANGIBLE ASSETS
GOODWILL AND INTANGIBLE ASSETS (Tables) | 6 Months Ended |
Jun. 30, 2020 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Goodwill and intangible assets | June 30, 2020 Gross carrying amount (1) Accumulated Amortization Net Book Value Useful Life Customer Base $ 1,197,200 $ (415,677 ) $ 781,523 3-10 Developed Technology 4,595,600 (1,361,663 ) 3,233,937 9 Film Library 957,000 (141,000 ) 816,000 11 Trademarks and Tradenames 132,000 (20,927 ) 111,073 12 Favorable leases 95,000 (33,920 ) 61,080 3 6,976,800 (1,973,187 ) 5,003,613 Goodwill $ 1,050,366 $ — $ 1,050,366 — December 31, 2019 Gross carrying amount (1) Accumulated Amortization Net Book Value Useful Life Customer Base $ 1,197,200 $ (364,383 ) $ 832,817 3-10 Developed Technology 4,595,600 (1,106,351 ) 3,489,249 9 Film Library 957,000 (104,900 ) 852,100 11 Trademarks and Tradenames 132,000 (15,123 ) 116,877 12 Favorable leases 95,000 (16,960 ) 78,040 3 6,976,800 (2,707,717 ) 5,369,083 Goodwill $ 1,050,366 $ — $ 1,050,366 — |
Amortization of intangible assets | 2020 2020 $ 356,961 2021 732,431 2022 732,431 2023 729,063 2024 712,079 Thereafter 1,740,648 $ 5,003,613 |
SEGMENT REPORTING (Tables)
SEGMENT REPORTING (Tables) | 6 Months Ended |
Jun. 30, 2020 | |
Segment Reporting [Abstract] | |
Summary information by segment | 2020 TPT Speed Connect Blue Collar Corporate and other Total Revenue $ 5,264,486 $ 526,092 $ 42,166 $ 5,832,744 Cost of revenue $ 3,228,092 $ 288,838 $ 220,747 $ 3,737,677 Net income (loss) $ 742,373 $ (245,955 ) $ (2,992,406 ) $ (2,495,988 ) Depreciation and amortization $ 239,988 $ 64,946 $ 577,903 $ 882,837 Derivative expense $ — $ — $ 400,019 $ 400,019 Interest expense $ 80,453 $ 19,644 $ 734,004 $ 834,101 2019 TPT Speed Connect Blue Collar Corporate and other Total Revenue $ 1,946,820 $ 464,047 $ 179,064 $ 2,589,931 Cost of revenue $ 1,227,989 $ 304,154 $ 218,173 $ 1,750,316 Net loss $ 186,725 $ (245,349 ) $ (11,466,533 ) $ (11,525,157 ) Depreciation and amortization $ 63,551 $ 10,281 $ 686,006 $ 759,838 Derivative expense $ — $ — $ 8,105,901 $ 8,105,901 Interest expense $ — $ 57,223 $ 1,220,215 $ 1,277,438 |
DESCRIPTION OF BUSINESS AND S_4
DESCRIPTION OF BUSINESS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Details) - USD ($) | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2020 | Jun. 30, 2019 | Jun. 30, 2020 | Jun. 30, 2019 | |
Total revenues | $ 2,756,771 | $ 2,428,455 | $ 5,832,744 | $ 2,589,931 |
TPT SpeedConnect | ||||
Total revenues | 5,264,486 | 1,946,820 | ||
Copperhead Digital | ||||
Total revenues | 0 | 128,130 | ||
K Telecom | ||||
Total revenues | 28,091 | 33,769 | ||
San Diego Media | ||||
Total revenues | 7,365 | 17,165 | ||
Blue Collar | ||||
Total revenues | 526,092 | 464,047 | ||
Other | ||||
Total revenues | $ 6,710 | $ 0 |
DESCRIPTION OF BUSINESS AND S_5
DESCRIPTION OF BUSINESS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Details 1) | 6 Months Ended |
Jun. 30, 2020shares | |
Potentially dilutive securities | 2,427,668,350 |
Convertible Promissory Notes | |
Potentially dilutive securities | 1,201,118,785 |
Series A Preferred Stock | |
Potentially dilutive securities | 1,219,627,539 |
Series B Preferred Stock | |
Potentially dilutive securities | 2,588,693 |
Stock Options and Warrants | |
Potentially dilutive securities | 4,333,333 |
DESCRIPTION OF BUSINESS AND S_6
DESCRIPTION OF BUSINESS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Details 2) | Jun. 30, 2020USD ($) |
Fair value of derivative instrument | $ 6,805,480 |
Auctus Convertible Promissory Notes | |
Fair value of derivative instrument | 5,423,940 |
EMA Financial Convertible Promissory Notes | |
Fair value of derivative instrument | 1,350,573 |
Warrants Issued with the Derivative Instruments | |
Fair value of derivative instrument | $ 30,967 |
ACQUISITIONS (Details)
ACQUISITIONS (Details) - SpeedConnect, LLC | 6 Months Ended |
Jun. 30, 2020USD ($) | |
Cash paid | $ 1,000,000 |
Liabilities: | |
Promissory note | 750,000 |
Deferred revenue | 230,000 |
Operating lease liabilities | 5,162,077 |
Unfavorable leases | 323,000 |
Accounts and other payables | 591,964 |
Total liabilities | 7,057,041 |
Total consideration value | 8,057,041 |
Assets | |
Customer base | 350,000 |
Cash | 201,614 |
Prepaid and other receivables | 99,160 |
Deposits | 13,190 |
Operating lease right of use asset | 5,162,077 |
Favorable leases | 95,000 |
Property and equipment | 1,939,000 |
Total assets acquired | 7,860,041 |
Goodwill | $ 197,000 |
ACQUISITIONS (Details 1)
ACQUISITIONS (Details 1) - USD ($) | 6 Months Ended | |
Jun. 30, 2020 | Jun. 30, 2019 | |
Derivative expense | $ 400,019 | $ 8,105,901 |
SpeedConnect, LLC | ||
Revenue | 7,352,758 | |
Cost of sales | 4,754,166 | |
Gross profit (loss) | 2,598,592 | |
Expenses | (4,514,097) | |
Derivative expense | (8,105,901) | |
Interest expense | (1,277,438) | |
Income taxes | 0 | |
Net loss | $ (11,298,844) | |
Loss per share | $ (.08) |
GOING CONCERN (Details Narrativ
GOING CONCERN (Details Narrative) - USD ($) | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2020 | Jun. 30, 2019 | Jun. 30, 2020 | Jun. 30, 2019 | |
Going Concern [Abstract] | ||||
Net loss | $ 2,470,210 | $ (8,543,811) | $ (3,495,988) | $ (11,525,157) |
Net cash used in operating activities | (318,895) | (1,082,208) | ||
Net cash provided by financing activities | $ 506,735 | $ 2,151,897 |
PROPERTY AND EQUIPMENT (Details
PROPERTY AND EQUIPMENT (Details) - USD ($) | Jun. 30, 2020 | Dec. 31, 2019 |
Accumulated depreciation | $ (1,771,286) | $ (1,253,919) |
Property and equipment, net | 4,176,920 | 4,423,148 |
Telecommunications Fiber and Equipment | ||
Property, plant and equipment, gross | 5,421,920 | 5,203,000 |
Film Production Equipment | ||
Property, plant and equipment, gross | 369,903 | 369,903 |
Office Furniture and Equipment | ||
Property, plant and equipment, gross | 86,899 | 85,485 |
Medical Equipment | ||
Property, plant and equipment, gross | 50,805 | 0 |
Leasehold Improvements | ||
Property, plant and equipment, gross | $ 18,679 | $ 18,679 |
PROPERTY AND EQUIPMENT (Detai_2
PROPERTY AND EQUIPMENT (Details Narrative) - USD ($) | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2020 | Jun. 30, 2019 | Jun. 30, 2020 | Jun. 30, 2019 | |
Property, Plant and Equipment [Abstract] | ||||
Depreciation expense | $ 259,964 | $ 128,000 | $ 517,367 | $ 199,707 |
DEBT FINANCING ARRANGEMENTS (De
DEBT FINANCING ARRANGEMENTS (Details) - USD ($) | Jun. 30, 2020 | Dec. 31, 2019 |
Debt Disclosure [Abstract] | ||
Business loans and advances, net of discounts | $ 2,284,196 | $ 1,121,640 |
Convertible notes payable, net of discounts | 1,711,098 | 2,101,649 |
Factoring agreement | 470,874 | 223,618 |
Debt - third party | 4,466,168 | 3,446,907 |
Line of credit, related party secured by assets | 3,043,390 | 3,043,390 |
Debt - other related party, net of discounts | 6,950,000 | 5,950,000 |
Convertible debt - related party | 922,881 | 922,881 |
Shareholder debt | 117,850 | 303,688 |
Debt - related party | 11,034,121 | 10,219,959 |
Total financing arrangements | 15,500,289 | 13,666,866 |
Less current liabilities: | ||
Loans, advances and agreements - third party | (1,794,497) | (344,758) |
Convertible notes payable, third party | (1,711,098) | (2,101,649) |
Debt - related party, net of discount | (10,111,240) | (9,297,078) |
Convertible notes payable - related party | (781,581) | (534,381) |
Total | (14,398,416) | (12,277,866) |
Total long term debt | $ 1,101,873 | $ 1,389,000 |
DERIVATIVE FINANCIAL INSTRUME_3
DERIVATIVE FINANCIAL INSTRUMENTS (Details) - USD ($) | 6 Months Ended | 12 Months Ended | |
Jun. 30, 2020 | Jun. 30, 2019 | Dec. 31, 2019 | |
Derivative expense | $ (400,019) | $ (8,105,901) | |
Level 3 | |||
Derivative liability, beginning | 8,836,514 | $ 0 | $ 0 |
Debt discount from initial derivative | 1,774,000 | ||
Initial fair value of derivative liabilities | 2,601,631 | ||
Change in derivative liability from conversion of notes payable | (1,144,290) | (407,654) | |
Change in derivative liabilities from the Odyssey conversion to a term loan | (1,286,763) | ||
Change in fair value of derivative liabilities at end of period | 400,019 | 4,868,537 | |
Derivative liability, ending | 6,805,480 | $ 8,836,514 | |
Derivative expense | $ 400,019 |
DERIVATIVE FINANCIAL INSTRUME_4
DERIVATIVE FINANCIAL INSTRUMENTS (Details Narrative) - USD ($) | 6 Months Ended | 12 Months Ended | |
Jun. 30, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Dividend yield | 0.00% | ||
Expected life | 2 years | ||
Minimum | |||
Expected volatility | 307.00% | ||
Quoted market price | $ .125 | ||
Maximum | |||
Expected volatility | 311.00% | ||
Quoted market price | $ .155 | ||
Derivative Liability | |||
Dividend yield | 0.00% | ||
Derivative Liability | Minimum | |||
Expected volatility | 314.20% | ||
Weighted average risk-free interest rate | 0.16% | ||
Expected life | 8 months 19 days | ||
Quoted market price | $ .029 | ||
Derivative Liability | Maximum | |||
Expected volatility | 350.30% | ||
Weighted average risk-free interest rate | 0.24% | ||
Expected life | 5 years | ||
Quoted market price | $ .029 | ||
Level 3 | |||
Derivative liability | $ 6,805,480 | $ 8,836,514 | $ 0 |
Change in fair value of derivative liabilities | $ 400,019 | $ 4,868,537 |
STOCKHOLDERS' DEFICIT (Details)
STOCKHOLDERS' DEFICIT (Details) | Jun. 30, 2020shares |
STOCKHOLDERS' DEFICIT | |
Unissued shares under consulting and director agreements | 6,000,000 |
Unissued shares for conversion of debt | 16,667 |
Unissued shares for acquisition of Bridge Internet | 4,000,000 |
Shares receivable under prior terminated acquisition agreement | (3,096,181) |
Net commitment | 6,920,486 |
STOCKHOLDERS' DEFICIT (Details
STOCKHOLDERS' DEFICIT (Details 1) - $ / shares | 6 Months Ended | 12 Months Ended | |
Jun. 30, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Options outstanding, beginning | 3,000,000 | 3,093,120 | |
Options expired | (2,000,000) | (93,120) | |
Options outstanding, ending | 1,000,000 | 3,000,000 | 3,093,120 |
Options vested | 1,000,000 | 3,000,000 | 1,954,230 |
Vesting period percentage | 100.00% | ||
Vesting period in months | 12 months | ||
Exercise price outstanding and exercisable, beginning | $ .10 | ||
Exercise price expired | |||
Exercise price outstanding and exercisable, ending | $ .10 | $ .10 | |
Minimum | |||
Vesting period in months | 12 months | 12 months | |
Exercise price outstanding and exercisable, beginning | $ .05 | ||
Exercise price expired | $ 0.05 | ||
Exercise price outstanding and exercisable, ending | $ .05 | ||
Expiration date | Mar. 1, 2020 | Mar. 1, 2020 | Dec. 31, 2019 |
Maximum | |||
Vesting period in months | 18 months | 18 months | |
Exercise price outstanding and exercisable, beginning | $ .22 | ||
Exercise price expired | $ 0.22 | ||
Exercise price outstanding and exercisable, ending | $ .22 | ||
Expiration date | Mar. 21, 2021 | Mar. 21, 2021 | Mar. 21, 2021 |
STOCKHOLDERS' DEFICIT (Detail_2
STOCKHOLDERS' DEFICIT (Details 2) | 6 Months Ended |
Jun. 30, 2020$ / shares | |
Dividend yield | 0.00% |
Expected life | 2 years |
Minimum | |
Expected annual volatility | 307.00% |
Discount rate | 2.20% |
Estimated fair value of the Company's common stock | $ .125 |
Maximum | |
Expected annual volatility | 311.00% |
Discount rate | 2.30% |
Estimated fair value of the Company's common stock | $ .155 |
STOCKHOLDERS' DEFICIT (Detail_3
STOCKHOLDERS' DEFICIT (Details Narrative) - USD ($) | 6 Months Ended | ||
Jun. 30, 2020 | Jun. 30, 2019 | Dec. 31, 2019 | |
Preferred stock, par value | $ 0.001 | $ 0.001 | |
Preferred stock, authorized | 100,000,000 | 100,000,000 | |
Common stock, par value | $ 0.001 | $ 0.001 | |
Common stock, authorized | 1,000,000,000 | 1,000,000,000 | |
Common stock, issued | 587,562,371 | 177,629,939 | |
Common stock, outstanding | 587,562,371 | 177,629,939 | |
Stock-based compensation related to the stock options | $ 0 | $ 113,488 | |
Series A Preferred Stock | |||
Mezzanine stock, authorized | 1,000,000 | 1,000,000 | |
Mezzanine stock, issued | 1,000,000 | 1,000,000 | |
Mezzanine stock, outstanding | 1,000,000 | 1,000,000 | |
Preferred stock, authorized | 1,000,000 | 1,000,000 | |
Preferred stock, issued | 1,000,000 | 1,000,000 | |
Preferred stock, outstanding | 1,000,000 | 1,000,000 | |
Series B Preferred Stock | |||
Mezzanine stock, authorized | 3,000,000 | 3,000,000 | |
Mezzanine stock, issued | 2,588,693 | 2,588,693 | |
Mezzanine stock, outstanding | 2,588,693 | 2,588,693 | |
Preferred stock, authorized | 3,000,000 | 3,000,000 | |
Preferred stock, issued | 2,588,693 | 2,588,693 | |
Preferred stock, outstanding | 2,588,693 | 2,588,693 | |
Series C Preferred Stock | |||
Preferred stock, authorized | 3,000,000 | 3,000,000 | |
Preferred stock, issued | 0 | 0 | |
Preferred stock, outstanding | 0 | 0 | |
Series D Preferred Stock | |||
Preferred stock, authorized | 20,000,000 | 20,000,000 | |
Preferred stock, issued | 0 | 0 | |
Preferred stock, outstanding | 0 | 0 |
COMMITMENTS AND CONTINGENCIES_2
COMMITMENTS AND CONTINGENCIES (Details) - USD ($) | Jun. 30, 2020 | Dec. 31, 2019 |
Commitments and Contingencies Disclosure [Abstract] | ||
Related parties | $ 1,094,360 | $ 1,141,213 |
General operating | 3,109,190 | 3,342,952 |
Accrued interest on debt | 1,023,376 | 793,470 |
Credit card balances | 180,993 | 183,279 |
Accrued payroll and other expenses | 611,710 | 207,108 |
Taxes and fees payable | 633,357 | 633,357 |
Unfavorable lease liability | 181,698 | 242,256 |
Total | $ 6,834,684 | $ 6,543,635 |
COMMITMENTS AND CONTINGENCIES_3
COMMITMENTS AND CONTINGENCIES (Details 1) | Jun. 30, 2020USD ($) |
Commitments and Contingencies Disclosure [Abstract] | |
2020 | $ 1,177,726 |
2021 | 1,920,224 |
2022 | 1,299,098 |
2023 | 784,887 |
2024 | 537,162 |
Thereafter | 318,501 |
Total lease payments | 6,037,598 |
Less imputed interest | (1,107,797) |
Present value of minimum lease payments | $ 4,929,801 |
COMMITMENTS AND CONTINGENCIES_4
COMMITMENTS AND CONTINGENCIES (Details 2) - Telecom Equipment Finance | Jun. 30, 2020USD ($) |
2020 | $ 449,103 |
In default | 0 |
Total | $ 449,103 |
COMMITMENTS AND CONTINGENCIES_5
COMMITMENTS AND CONTINGENCIES (Details Narrative) - USD ($) | 6 Months Ended | ||
Jun. 30, 2020 | Jun. 30, 2019 | Dec. 31, 2019 | |
Commitments and Contingencies Disclosure [Abstract] | |||
Operating lease right-of-use assets | $ 4,808,632 | $ 3,886,045 | |
Operating lease liabilities | 4,929,801 | ||
Lease expense | 1,406,101 | ||
Rent and utility | 15,000 | $ 15,500 | |
Customer liability | $ 338,725 | $ 338,725 |
RELATED PARTY ACTIVITY (Details
RELATED PARTY ACTIVITY (Details Narrative) - USD ($) | Jun. 30, 2020 | Dec. 31, 2019 |
Related Party Transactions [Abstract] | ||
Due to related parties | $ 1,094,360 | $ 1,141,213 |
GOODWILL AND INTANGIBLE ASSET_2
GOODWILL AND INTANGIBLE ASSETS (Details) - USD ($) | 6 Months Ended | 12 Months Ended |
Jun. 30, 2020 | Dec. 31, 2019 | |
Gross carrying amount | $ 6,976,800 | $ 6,976,800 |
Accumulated amortization | (1,973,187) | (2,707,717) |
Net book value | 5,003,613 | 5,369,083 |
Goodwill | 1,050,366 | 1,050,366 |
Customer Base | ||
Gross carrying amount | 1,197,200 | 1,197,200 |
Accumulated amortization | (415,677) | (364,383) |
Net book value | $ 781,523 | $ 832,817 |
Customer Base | Minimum | ||
Useful life | 3 years | 3 years |
Customer Base | Maximum | ||
Useful life | 10 years | 10 years |
Developed Technology | ||
Gross carrying amount | $ 4,595,600 | $ 4,595,600 |
Accumulated amortization | (1,361,663) | (1,106,351) |
Net book value | $ 3,233,937 | $ 3,489,249 |
Useful life | 9 years | 9 years |
Film Library | ||
Gross carrying amount | $ 957,000 | $ 957,000 |
Accumulated amortization | (141,000) | (104,900) |
Net book value | $ 816,000 | $ 852,100 |
Useful life | 11 years | 11 years |
Trademarks and Tradenames | ||
Gross carrying amount | $ 132,000 | $ 132,000 |
Accumulated amortization | (20,927) | (15,123) |
Net book value | $ 111,073 | $ 116,877 |
Useful life | 12 years | 12 years |
Favorable Leases | ||
Gross carrying amount | $ 95,000 | $ 95,000 |
Accumulated amortization | (33,920) | (16,960) |
Net book value | $ 61,080 | $ 78,040 |
Useful life | 3 years | 3 years |
GOODWILL AND INTANGIBLE ASSET_3
GOODWILL AND INTANGIBLE ASSETS (Details 1) - USD ($) | Jun. 30, 2020 | Dec. 31, 2019 |
Goodwill and Intangible Assets Disclosure [Abstract] | ||
2020 | $ 356,961 | |
2021 | 732,431 | |
2022 | 732,431 | |
2023 | 729,063 | |
2024 | 712,079 | |
Thereafter | 1,740,648 | |
Total | $ 5,003,613 | $ 5,369,083 |
GOODWILL AND INTANGIBLE ASSET_4
GOODWILL AND INTANGIBLE ASSETS (Details Narrative) - USD ($) | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2020 | Jun. 30, 2019 | Jun. 30, 2020 | Jun. 30, 2019 | |
Goodwill and Intangible Assets Disclosure [Abstract] | ||||
Amortization expense | $ 182,735 | $ 354,129 | $ 365,470 | $ 560,131 |
SEGMENT REPORTING (Details)
SEGMENT REPORTING (Details) - USD ($) | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2020 | Jun. 30, 2019 | Jun. 30, 2020 | Jun. 30, 2019 | |
Revenues | $ 2,756,771 | $ 2,428,455 | $ 5,832,744 | $ 2,589,931 |
Cost of revenue | 1,628,260 | 1,487,948 | 3,737,677 | 1,750,316 |
Net income (loss) | (2,495,988) | (11,525,157) | ||
Depreciation and amortization | 882,837 | 759,838 | ||
Derivative expense | 400,019 | 8,105,901 | ||
Interest expense | $ 287,344 | $ 1,147,201 | 834,101 | 1,277,438 |
TPT Speed Connect | ||||
Revenues | 5,264,486 | 1,946,820 | ||
Cost of revenue | 3,228,092 | 1,227,989 | ||
Net income (loss) | 742,373 | 186,725 | ||
Depreciation and amortization | 239,988 | 63,551 | ||
Derivative expense | 0 | 0 | ||
Interest expense | 80,453 | 0 | ||
Blue Collar | ||||
Revenues | 526,092 | 464,047 | ||
Cost of revenue | 288,838 | 304,154 | ||
Net income (loss) | (245,955) | (245,349) | ||
Depreciation and amortization | 64,946 | 10,281 | ||
Derivative expense | 0 | 0 | ||
Interest expense | 19,644 | 57,223 | ||
Corporate and Other | ||||
Revenues | 42,166 | 179,064 | ||
Cost of revenue | 220,747 | 218,173 | ||
Net income (loss) | (2,992,406) | (11,466,533) | ||
Depreciation and amortization | 577,903 | 686,006 | ||
Derivative expense | 400,019 | 8,105,901 | ||
Interest expense | $ 734,004 | $ 1,220,215 |