Document and Entity Information
Document and Entity Information - shares | 6 Months Ended | |
Jun. 30, 2017 | Dec. 19, 2017 | |
Document And Entity Information | ||
Entity Registrant Name | Elite Data Services, Inc. | |
Entity Central Index Key | 704,366 | |
Document Type | 10-Q | |
Document Period End Date | Jun. 30, 2017 | |
Amendment Flag | false | |
Current Fiscal Year End Date | --12-31 | |
Is Entity a Well-known Seasoned Issuer | No | |
Is Entity a Voluntary Filer | No | |
Is Entity's Reporting Status Current | No | |
Entity Filer Category | Smaller Reporting Company | |
Entity Common Stock, Shares Outstanding | 205,450,287 | |
Document Fiscal Period Focus | Q2 | |
Document Fiscal Year Focus | 2,017 |
CONDENSED CONSOLIDATED BALANCE
CONDENSED CONSOLIDATED BALANCE SHEETS - USD ($) | Jun. 30, 2017 | Dec. 31, 2016 |
CURRENT ASSETS: | ||
Cash | $ 540 | |
Total Current Assets | 540 | |
OTHER ASSET: | ||
WOD membership | 17,261 | 20,000 |
Total Assets | 17,261 | 20,540 |
CURRENT LIABILITIES: | ||
Bank overdraft | 126 | |
Accounts payable and accrued liabilities | 1,346,804 | 958,784 |
Convertible notes from related party, net of discount $81,322 and $287,436, respectively | 368,178 | 150,064 |
Derivative instrument liability | 6,130,405 | 5,721,145 |
Convertible notes payable, net of discount of $61,355 and $583,540, respectively | 4,570,090 | 2,929,742 |
Total Current Liabilities | 12,415,603 | 9,759,735 |
LONG TERM DEBT: | ||
Convertible note payable | 500,000 | 2,500,000 |
Convertible note payable, related party, net of discount $0 and $142,773, respectively | 69,227 | |
Total Liabilities | 12,915,603 | 12,328,962 |
STOCKHOLDERS’ DEFICIT: | ||
Common stock, $0.0001 par value; 500,000,000 shares authorized; issued and outstanding 150,018,799 and 136,518,799, respectively | 15,001 | 13,651 |
Subscription stock not issued | 75,000 | 75,000 |
Additional paid-in capital | 17,991,386 | 22,783,785 |
Deficit accumulated | (30,979,839) | (35,181,068) |
Total Stockholders’ Deficit | (12,898,342) | (12,308,422) |
Total Liabilities and Stockholders’ Deficit | 17,261 | 20,540 |
Series B Preferred Stock [Member] | ||
STOCKHOLDERS’ DEFICIT: | ||
Preferred stock, $0.0001 par value; 250,000,000 shares Series B authorized; issued and outstanding 0 | $ 110 | $ 210 |
CONDENSED CONSOLIDATED BALANCE3
CONDENSED CONSOLIDATED BALANCE SHEETS (Parenthetical) - USD ($) | Jun. 30, 2017 | Dec. 31, 2016 |
CURRENT LIABILITIES: | ||
Convertible notes from a related party, net of discount | $ 81,322 | $ 287,436 |
Convertible notes payable, net of discounts | 61,355 | 583,540 |
Convertible note payable, related party, net of discount | $ 0 | $ 142,773 |
STOCKHOLDERS' DEFICIT: | ||
Preferred stock, Par value | $ 0.0001 | |
Preferred stock, Authorized | 250,000,000 | |
Common stock, par value | $ 0.0001 | $ 0.0001 |
Common stock, Authorized | 500,000,000 | 500,000,000 |
Common stock, Issued | 150,018,799 | 136,518,799 |
Common stock, outstanding | 150,018,799 | 136,518,799 |
Series B Preferred Stock [Member] | ||
STOCKHOLDERS' DEFICIT: | ||
Preferred stock, Par value | $ 0.0001 | $ 0.0001 |
Preferred stock, Authorized | 250,000,000 | 250,000,000 |
Preferred stock, Issued | 0 | 0 |
Preferred stock, Outstanding | 0 | 0 |
CONDENSED CONSOLIDATED STATEMEN
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (Unaudited) - USD ($) | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2017 | Jun. 30, 2016 | Jun. 30, 2017 | Jun. 30, 2016 | |
Condensed Consolidated Statements Of Operations | ||||
REVENUES | ||||
OPERATING EXPENSES | ||||
Consulting services | 30,000 | 10,000 | 110,000 | 10,000 |
Asset impairment | 4,900,000 | 4,900,000 | ||
Accounting | 21,000 | 35,558 | ||
Investor relations services | 3,115 | 3,115 | ||
Wages | 38,750 | 50,000 | ||
General and administrative | 6,320 | 35,007 | 9,699 | 42,607 |
Total Operating Expenses | 96,070 | 4,948,122 | 205,257 | 4,955,722 |
LOSS FROM OPERATIONS | (96,070) | (4,948,122) | (205,257) | (4,955,722) |
OTHER INCOME (EXPENSE): | ||||
Gain forgiveness of debt | 695 | 34,177 | ||
Amortization debt discount | (425,808) | (83,799) | (1,544,476) | (291,308) |
Derivative expense | 3,073,163 | (955,045) | 264,504 | (1,124,993) |
(Loss) on derivative settlement | (6,623) | (6,623) | (268,018) | |
Gain on settlement of debt | 1,262,162 | 6,000,000 | 1,262,162 | |
Interest expense - related party | (11,237) | (51,255) | (26,531) | (67,115) |
Interest expense - other | (128,813) | (310,395) | (277,648) | (322,336) |
Total Other Expense | 2,500,682 | (137,637) | 4,409,226 | (777,431) |
NET GAIN (LOSS) | 2,404,612 | (5,085,759) | 4,203,969 | (5,733,153) |
Non-controlling interest | (1,475) | (2,739) | ||
COMPREHENSIVE GAIN (LOSS) BEFORE PROVISION FOR INCOME TAXES | 2,403,137 | 4,201,230 | ||
PROVISION FOR INCOME TAX | ||||
COMPREHENSIVE GAIN (LOSS) | $ 2,403,137 | $ (5,085,759) | $ 4,201,230 | $ (5,733,153) |
Basic and Diluted Per Share Data: Net Loss Per Share - Basic and Diluted | $ 0.02 | $ (0.04) | $ 0.03 | $ (0.06) |
Weighted Average Common Shares Outstanding: Basic and diluted | 140,079,239 | 130,237,299 | 138,308,854 | 97,465,499 |
CONDENSED CONSOLIDATED STATEME5
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited) - USD ($) | 6 Months Ended | |
Jun. 30, 2017 | Jun. 30, 2016 | |
OPERATING ACTIVITIES: | ||
Net loss | $ 4,203,969 | $ (5,733,153) |
Stock issued for accrued interest or penalties | 750 | 281 |
(Gain) on settlement or extinguishment of debt | (6,000,000) | (1,262,162) |
Loss on settlement of derivative | 6,623 | 268,018 |
Forgiven interest and accounts payable converted to notes | 119,964 | |
Accounts payable to notes payable | 120,000 | |
Derivative expenses | (264,504) | 1,124,993 |
Amortization debt discount | 1,544,476 | 291,308 |
Asset impairment | 4,900,000 | |
Changes in operating assets and liabilities: | ||
Accounts payable and bank overdraft | 388,146 | 271,520 |
Net cash (used in) operating activities | (540) | (19,230) |
FINANCING ACTIVITIES: | ||
Proceeds from convertible promissory notes | 17,500 | |
Net cash received from financing activities | 17,500 | |
NET DECREASE IN CASH | (540) | (1,730) |
CASH BEGINNING OF PERIOD | 540 | 1,730 |
CASH END OF PERIOD | ||
SUPPLEMENTAL DISCLOSURES: | ||
Income taxes paid | ||
Interest paid | ||
SUPPLEMENTAL DISCLOSURE OF NON-CASH INVESTING AND FINANCING ACTIVITIES | ||
Issuance of common stock for conversion of debt | 1,448 | 60,687 |
Issuance of common stock for consulting services |
DESCRIPTION OF BUSINESS
DESCRIPTION OF BUSINESS | 6 Months Ended |
Jun. 30, 2017 | |
Notes to Financial Statements | |
NOTE 1 - DESCRIPTION OF BUSINESS | Elite Data Services, Inc., Florida corporation (hereinafter the Company, Our, We or Us) is a retail focused management company which currently owns a 20% minority interest of WOD Market LLC, a Colorado limited liability company, a provider of intelligent retail solutions for gym owners and coaches, including the management of retail sales, up front inventory purchases, ongoing inventory management, payments, marketing, and related services. Prior to March 14, 2017, the Company was a technology driven management company which owned and operated online marketing and gaming businesses: Elite Data Marketing LLC, and Elite Gaming Ventures LLC, from 2013 and 2014, respectively. During the year ending December 31, 2016, we made limited progress with our online marketing platforms due to lack of funding to complete required programming and coding enhancements. During the year ending December 31, 2016, we anticipated obtaining additional funding which would have afforded us the ability of bringing certain new marketing offerings to our platforms in hopes of increasing traffic flow, capturing new users and generating revenues. Due to the Company not being a current fully reporting company in 2016, the Company was unable to raise the capital needed to advance the online marketing business resulting in a loss of business opportunities. On March 14, 2017, Company executed a note cancellation agreement and assignment with Baker & Myers & Associates LLC which resulted in Elite Data Marketing LLC no longer being a subsidiary of the Company, with no further operational effect or obligation to the Company. Separately, pursuant to the terms of the Joint Venture with HYHI formed on or about May 18, 2016, we intended to implement the creation of the joint venture relationship using Elite Data Holdings S.A., a Honduras corporation, a wholly-owned subsidiary of Elite Gaming Ventures LLC, a Florida limited liability company ("EVG"), a wholly-owned subsidiary of the Company, and a distributor license from HYHI and El Mar Muerto Beauty Mineral, S.A., a Honduras corporation ("EMBM") to establish gaming operations (the "Purpose") by distributing and maintaining a total of eighty (80) slot machines in the cities of La Lima, Cortes; eighty (80) slot machines in the cities of Trujillo, Colon; and One Hundred and Sixty (160) slot machines in Roatan in the bay island of Honduras. In order to effect the distributor license related to the gaming operations, the Company and EVG was responsible for providing any and all financial and operational resources required to execute on the license granted to the Company, including, but not limited to, the funding for the initial and ongoing operating costs in the minimum amount of Five Hundred Thousand Dollars (USD $500,000) on or before December 31, 2016 (the "Initial Funding"). During the period ending December 31, 2016, the Company was unable to raise the capital required to pay the minimum operational costs of the joint venture which resulted in a loss of business opportunities, and further strained the relationship with HYHI, our joint venture partner. On March 14, 2017, Company executed a joint venture termination agreement with H Y H Investments S.A. which resulted in Elite Gaming Ventures LLC (and, its wholly-owned subsidiary, Elite Data Holdings S.A.) no longer being a subsidiary of the Company, with no further operational effect or obligation to the Company, except for certain amounts owed by the Company under a further amendment to the Amended and Restated Redeemable Note executed on May 18, 2016 at the time the Joint Venture was formed. Separately, the Company intended to expand its operations in the fourth quarter of 2016 to include intelligent retail solutions for gym owners and coaches through the completion of the acquisition of WOD, as set forth in the definitive agreement dated August 26, 2016, at which time the Company acquired a minority interest stake of 20% of WOD, with 100% ownership interest of WOD anticipated to be completed on or before October 15, 2016. WOD serves the fitness community by allowing coaches and trainers to focus on whats important while athletes have access to the products they need to perform at their highest level. WOD aims to relieve gym owners and coaches of the burden of managing retail sales including upfront inventory purchases, ongoing inventory management, payments, marketing, etc. while also providing a service for members to have convenient access to products that help them perform better. WOD intends to forge a mutually beneficial relationship with each gym, customer and vendor to ensure the best possible experience. On January 10, 2017, the Company executed the first amendment to the purchase of WOD to extend the second closing date from on or about September 15, 2016 to on or about March 31, 2017, and further extend the third and final closing date from on or about October 15, 2016 to on or about June 30, 2017, respectively. Pursuant to managements decision to divest itself from its online marketing and gaming businesses, and focus exclusively on the fitness retail sales business, the Company executed the second amendment to the definitive agreement on March 14, 2017, which further amended certain terms of the WOD purchase, including the formation of a joint venture to further develop and manage the current WOD business. Under the terms of the Joint Venture, the initial ownership interest of WOD was 20% owned by the Company, with the remaining 80% owned WODH, with the option of Company to provide additional capital contributions to WOD in increments of not less than $10,000 up to a total of $8 million dollars in the aggregate, which included an equity exchange of up to a total of 800 units (80%) of WOD owned initially by WODH to the Company for a total of approximately 199,000 shares of Series B Preferred Stock and approximately 19,801,000 shares of Common Stock of the Company (the Shares) to be issued to WODH upon the completion of a final closing on or before December 31, 2018. Until a minimum of at least $4 million in additional capital contributions have been made by the Company to WOD, resulting in a controlling ownership interest of not less than 60% of WOD by the Company, all the Shares of Company stock earmarked for the equity exchange with WODH is being held in a Voting Trust (as defined elsewhere in this filing), along with other key shareholder positions, in order to recapitalize the Company post a 1:1000 reverse split (which was previously approved), pending effectiveness after the Company becomes a current and fully-reporting public company. |
BASIS OF PRESENTATION
BASIS OF PRESENTATION | 6 Months Ended |
Jun. 30, 2017 | |
Notes to Financial Statements | |
Note 2 - BASIS OF PRESENTATION | The accompanying unaudited condensed consolidated financial statements of Elite Data Services, Inc. (the "Company") are presented in accordance with the requirements for Form 10-Q and Regulation S-X. Accordingly, they do not include all of the disclosures required by generally accepted accounting principles. In the opinion of management, all adjustments (all of which were of a normal recurring nature) considered necessary to fairly present the financial position, results of operations, and cash flows of the Company on a consistent basis, have been made. The accompanying unaudited interim condensed consolidated financial statements of the Company have been prepared in accordance with accounting principles generally accepted in the United States of America and the rules of the Securities and Exchange Commission ("SEC"), and should be read in conjunction with the audited financial statements and notes thereto contained in our annual 10-K filing, filed with the SEC on December 19, 2017. In the opinion of management, all adjustments, consisting of normal recurring adjustments, necessary for a fair presentation of financial position and the results of operations for the interim periods presented have been reflected herein. The results of operations for interim periods are not necessarily indicative of the results to be expected for the full year. Notes to the financial statements, which would substantially duplicate the disclosure contained in the audited consolidated financial statements for the most recent fiscal year ended December 31, 2016 have been omitted. Going Concern The Company has accumulated a deficit of $30,979,839. The Company currently has only limited working capital with which to continue its operating activities. The amount of capital required to sustain operations is subject to future events and uncertainties. The Company must secure additional working capital through loans, sale of equity securities, or a combination, in order to implement its current business plans. There can be no assurance that such funding will be available in the future, or available on commercially reasonable terms favorable to the Company. These conditions raise substantial doubt about the Company's ability to continue as a going concern. The accompanying condensed consolidated financial statements have been presented on the basis of the continuation of the Company as a going concern and do not include any adjustments relating to the recoverability and classification of recorded asset amounts or the amounts and classifications of liabilities that might be necessary should the Company be unable to continue as a going concern. |
SUMMARY OF SIGNIFICANT ACCOUNTI
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | 6 Months Ended |
Jun. 30, 2017 | |
Notes to Financial Statements | |
NOTE 3 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | Principles of Consolidation The consolidated financial statements have been prepared in accordance with generally accepted accounting principles and include the accounts of the Company and its subsidiaries, Dynamic Energy Development Corp. and Transformation Consulting, Inc. All intercompany balances 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 and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. The Company regularly evaluates estimates and assumptions related to intangible assets and deferred income tax asset valuation allowances. The Company bases its estimates and assumptions on current facts, historical experience and various other factors that it believes to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities and the accrual of costs and expenses that are not readily apparent from other sources. The actual results experienced by the Company may differ materially and adversely from the Companys estimates. To the extent there are material differences between the estimates and the actual results, future results of operations will be affected. Reclassifications Certain reclassifications have been made in Statement of Operations for the year 2016 to the period ended March 31, 2017. These reclassifications impacted the classification of certain items within the Statement of Operations: relating to classification of interest expense. The reclassifications had no impact on previously reported total operating expenses, net loss, or stockholders' deficit. Development Costs Development costs are expensed in the period they are incurred unless they meet specific criteria related to technical, market and financial feasibility, as determined by management, including but not limited to the establishment of a clearly defined future market for the product, and the availability of adequate resources to complete the project. If all criteria are met, the costs are deferred and amortized over the expected useful life, or written off if a product is abandoned. For the six months ended June 30, 2017, the Company incurred no development costs. As of June 30, 2017, the Company had no deferred product development costs. Income Taxes Potential benefits of income tax losses are not recognized in the accounts until realization is more likely than not. The Company has adopted the accounting standards codified in ASC 740, Income Taxes as of its inception. Pursuant to those standards, the Company is required to compute tax asset benefits for net operating losses carried forward. Potential benefit of net operating losses have not been recognized in these financial statements because the Company cannot be assured it is more likely than not that it will utilize the net operating losses carried forward in future years. ASC 740-10-25 prescribes recognition thresholds that must be met before a tax position is recognized in the financial statements and provides guidance on de-recognition, classification, interest and penalties, accounting in interim periods, disclosure, and transition. An entity may only recognize or continue to recognize tax positions that meet a "more likely than not" threshold. Based on its evaluation, the Company has concluded that there are no significant uncertain tax positions requiring recognition in its financial statements. The Company does not have any unrecognized tax benefits as of June 30, 2017 that, if recognized, would affect the Company's effective income tax rate. The Company's policy is to recognize interest and penalties related to income tax issues as components of income tax expense. The Company did not recognize or have any accrual for interest and penalties relating to income taxes as of June 30, 2017 and December 31, 2016. Cash and Cash Equivalents Cash include all highly liquid instruments with an original maturity of three months or less at the date of purchase. The Company maintains its cash in cash deposit accounts, which are insured by the Federal Deposit Insurance Corporation (FDIC) up to $250,000 per legal ownership. At times, the Companys accounts may exceed federally insured limits. To date, the Company has not experienced any losses in such accounts. At June 30, 2017, the Company had no cash equivalents. Fair Value of Financial Instruments The Companys financial instruments consist of cash, accounts payable, accrued liabilities, line of credit payable, loans from a related party, contingent consideration payable, and convertible note payable. The carrying amount of these financial instruments approximates fair value due either to length of maturity or interest rates that approximate prevailing market rates unless otherwise disclosed in these financial statements. Fair Value Measurement The Company values its derivative instruments under FASB ASC 820 which defines fair value, establishes a framework for measuring fair value, and expands disclosures about fair value measurements. Fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date (exit price). The Company utilizes market data or assumptions that market participants would use in pricing the asset or liability, including assumptions about risk and the risks inherent in the inputs to the valuation technique. These inputs can be readily observable, market corroborated, or generally unobservable. The Company classifies fair value balances based on the observability of those inputs. ASC 820 establishes a fair value hierarchy that prioritizes the inputs used to measure fair value. The hierarchy gives the highest priority to unadjusted quoted prices in active markets for identical assets or liabilities (level 1 measurement) and the lowest priority to unobservable inputs (level 3 measurement). The three levels of the fair value hierarchy are as follows: Level 1 Quoted prices are available in active markets for identical assets or liabilities as of the reporting date. Active markets are those in which transactions for the asset or liability occur in sufficient frequency and volume to provide pricing information on an ongoing basis. Level 1 primarily consists of financial instruments such as exchange-traded derivatives, marketable securities and listed equities. Level 2 Pricing inputs are other than quoted prices in active markets included in level 1, which are either directly or indirectly observable as of the reported date. Level 3 Pricing inputs include significant inputs that are generally less observable from objective sources. These inputs may be used with internally developed methodologies that result in managements best estimate of fair value. The Company's financial instruments consisted of cash, prepaid expense, deposit, accounts payable and accrued liabilities, line of credit, loan from stockholders and convertible debt. The estimated fair value of cash, prepaid expense, deposit, accounts payable and accrued liabilities, line of credit, loan from stockholders approximates its carrying amount due to the short maturity of these instruments. The recognition of the derivative values of convertible debt are based on the weighted-average Black-Scholes option pricing model. Revenue Recognition The Company recognizes revenue in accordance with the FASB ASC Section 605-10-S99, Revenue Recognition, Overall, SEC Materials ("Section 605-10-S99"). Section 605-10-S99 requires that four basic criteria must be met before revenue can be recognized: (1) persuasive evidence of an arrangement exists; (2) delivery has occurred or services rendered; (3) the fee is fixed and determinable; and (4) collectability is reasonably assured. Impairment of Long-Lived Intangible Assets We review our long-lived assets, including intangible assets subject to amortization, for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. Impairment, if any, is measured as the excess of the carrying amount over the fair value based on market value (when available) or discounted expected cash flows of those assets, and is recorded in the period in which the determination is made. Intangible assets not subject to amortization are tested annually for impairment and more frequently if events or changes in circumstances indicate that it is more likely than not that the asset is impaired. Net Income (Loss) Per Common Share Basic loss per common share (EPS) is calculated by dividing the net loss available to common shareholders by the weighted average number of common shares outstanding for the period. Diluted EPS reflects the potential dilution that could occur if securities or other contracts to issue common stock were exercised or converted into common stock. The number of common shares that are exercisable or converted into common stock is not material to affect diluted EPS results. Further, since the Company shows losses for the periods presented basic and diluted loss per share are the same for all periods presented. Common Share Non-Monetary Consideration In situations where common shares are issued and the fair value of the goods or services received is not readily determinable, the fair value of the common shares is used to measure and record the transaction. The fair value of the common shares issued in exchange for the receipt of goods and services is based on the stock price as of the earliest of the date at which: i The counterpartys performance is complete; ii. commitment for performance by the counterparty to earn the common shares is reached; or iii. the common shares are issued if they are fully vested and non-forfeitable at that date. Stock-Based Compensation On December 1, 2005, the Company adopted the fair value recognition provisions codified in ASC 718, Compensation-Stock Compensation. The Company adopted those provisions using the modified-prospective-transition method. Under this method, compensation cost recognized for all periods prior to December 1, 2005 includes: a) compensation cost for all share-based payments granted prior to, but not yet vested as of November 30, 2005, based on the grant-date fair value and b) compensation cost for all share-based payments granted subsequent to November 30, 2005, based on the grant-date fair value. In addition, deferred stock compensation related to non-vested options is required to be eliminated against additional paid-in capital. The results for periods prior to December 1, 2005 were not restated. The Company accounts for equity instruments issued in exchange for the receipt of goods or services from parties other than employees in accordance with ASC 505, Equity. Costs are measured at the estimated fair market value of the consideration received or the estimated fair value of the equity instruments issued, whichever is more reliably measurable. The value of equity instruments issued for consideration other than employee services is determined on the earliest of a performance commitment or completion of performance by the counterparty. Share Purchase Warrants The Company accounts for common share purchase warrants at fair value in accordance with ASC 815, Derivatives and Hedging. The Black-Scholes option pricing valuation method is used to determine fair value of these warrants. Use of this method requires that the Company make assumptions regarding stock volatility, dividend yields, expected term of the warrants and risk-free interest rates. Recently Issued Accounting Pronouncements Other than as set forth below, management does not believe that any recently issued, but not yet effective accounting pronouncements, if adopted, would have a material effect on the accompanying financial statements. None. |
RELATED PARTY CONVERTIBLE PROMI
RELATED PARTY CONVERTIBLE PROMISSORY NOTE | 6 Months Ended |
Jun. 30, 2017 | |
Notes to Financial Statements | |
NOTE 4 - RELATED PARTY CONVERTIBLE PROMISSORY NOTE | Myers Line of Credit (LOC) The principal amount due Sarah Myers (director and executive officer of the Company, the related party) at June 30, 2016 and 2015 was $175,000 and $151,000, respectively, represents an unsecured promissory note and addendums (Myers - LOC). These amounts are unsecured and bear interest at the rate of 10% and 12% per annum, respectively. The Myers - LOC has been amended to be due and payable on December 31, 2016 The accrued interest under the Myers - LOC as of June 30, 2016 and 2015 was $45,147 and $27,540, respectively. The amount due under the Myers - LOC at June 30, 2017 was $149,500. The amount is unsecured and bears interest at 10% per annum. At June 30, 2017, accrued interest on the amount was $67,622 and a debt discount balance of $33,250. Baker Myers Note and Share Cancellation and Exchange Agreement On May 18, 2016, the Elite Data Services, Inc. (the "Company") Company and Baker Myers and Associates LLC, a Nevada limited liability company ("Baker Myers," an entity owned by Sarah Myers, the President, Chief Operating Officer and Director of the Company ) executed a Note and Share Cancellation and Exchange Agreement (the "Share Exchange Agreement"), with respect to that certain unsecured Promissory Note (the "Original Baker Myers Note") dated on or about January 13, 2013, in the original amount of $587,500 (the "Original Amount"), pursuant to which Baker Myers agreed to forego and waive any and all right in, entitlement to or interest in (A) a total of $87,500 in principal, a total of $92,465 in accrued interest, late charges, reimbursable attorneys' fees, reimbursable expenses and any other sums due and payable under the Original Baker Myers Note totaling $179,965 (the "Cancelled Amount") as of the date of execution (the "Effective Date"), any future payments due under the Original Baker Myers Note and all or any other of Baker Myers's rights under the Cancelled Amount of the Original Baker Myers Note, thereby extinguishing and canceling the Cancelled Amount of the Original Baker Myers Note and terminating any and all of Company's obligations thereunder, (B) the Shares (hereinafter also referred to as the "Cancelled Shares") in exchange for the issuance an Option Agreement (the "Option Agreement"), registered in the Baker Myers's name to purchase up to a certain number of membership interests (the "EDM Membership Interest") of Elite Data Marketing LLC, a Florida limited liability company (the "EDM"), in an amount totaling one hundred percent (100%) of the ownership interest in EDM (the "Option 1"), (B) the issuance by Company to Baker Myers of a three-year "cashless" common stock purchase warrant (the "Warrant No. BM-1") for the right to purchase a total of 3,000,000 shares of Series B Preferred Stock of the Company (the "Preferred Warrant Shares"), at a purchase price of $0.001 per share, with certain rights and preferences as set forth in the certificate of designation (the "Certificate of Designation of Series B Preferred), in exchange for the Cancelled Shares, as referenced in the Share Exchange Agreement, and (C) the issuance of an amended and restated convertible redeemable note (the "Redeemable Note") in the aggregate principal face amount of Five Hundred Thousand Dollars (US$500,000), at ten percent (10%) interest per annum commencing on date of execution (the "Effective Date"), due and payable by the Company in eight (8) separate equal quarterly payments of Sixty-Two Thousand Five Hundred Dollars (USD $62,500), plus accrued interest to date, due on the first day of each quarter beginning on the date of the first quarter following the date of execution of this Original Baker Myers Note, convertible into shares of the Company's common stock at a conversion price equal to the lesser of $0.01 per share or a discount of fifty-eight percent (58%) of the lowest trading price for the ten (10) prior trading days, subject to aggregate conversion limitations of 4.99% and other terms and conditions set forth therein. On or about March 14, 2017, the Company and Baker & Myers & Associates LLC, a Nevada limited liability company ("Baker Myers," an entity owned by Sarah Myers, a former Secretary, Treasurer and Director of the Company) executed a Note Cancellation and Extinguishment Agreement (the Note Cancellation Agreement), pursuant to which Baker Myers (also herein referred to as Releasor) decided to exercise the entire Option Agreement for the acquisition of Elite Data Marketing LLC, a Florida limited liability company (the "EDM"), as set forth in the Share Exchange Agreement, dated May 18, 2016, in which Releasor agreed to forego and waive any and all right in, entitlement to or interest in any principal, interest, late charges, reimbursable attorneys fees, reimbursable expenses and any other sums due and payable with respect to a total of Two Hundred Thousand Dollars (US$200,000) of the final two (2) quarterly payments of the Redeemable Note dated May 18, 2016 (the Cancelled Sum), and any future payments due under the Cancelled Sum of the Redeemable Note and all or any other of Releasors rights under the Cancelled Sum of the Redeemable Note, thereby extinguishing and canceling the Cancelled Sum of the Redeemable Note and terminating any and all of Releasees obligations thereunder Cancelled Sum of the Redeemable Note, effective as of March 14, 2017 (the Effective Date), in exchange for the assignment and transfer by the Company of any and all of the issued and outstanding membership interests owned and held by Releasee representing a total of One Hundred Percent (100%) of the ownership interest of EDM to Releasor on the Effective Date (the Cancellation Transaction), pursuant to the Assignment of Membership Interests (the Assignment), attached as Exhibit A to the Note Cancellation Agreement, and including other terms and conditions set forth therein. The Cancellation Transaction and Assignment resulted in Elite Data Marketing LLC, which was created in May of 2016 to hold the assets of www.classifiedride.com originally acquired by the Company from Baker Myers, no longer being a subsidiary of the Company, with no further operational effect or obligation to the Company. The principal amount due on the Baker Myers Note at June 30, 2017 was $300,000. These amounts are unsecured and bear interest at the rate of 12% per annum. The balance of the note and accrued interest at June 30, 2017 was $401,333 and a debt discount balance of $48,072. At June 30, 2017, the principal was $300,000 with the accrued interest on the amount at $101,333 and a debt discount of $48,072. |
CONVERTIBLE PROMISSORY NOTES
CONVERTIBLE PROMISSORY NOTES | 6 Months Ended |
Jun. 30, 2017 | |
Notes to Financial Statements | |
NOTE 5 - CONVERTIBLE PROMISSORY NOTES | Tarpon Bay Partners Line of Credit In conjunction with the Equity Line as discussed in Note 15 below, the Company issued a promissory note to Tarpon Bay Partners for $50,000, due on January 31, 2016, with 10% interest per annum as consideration for transaction costs incurred by Tarpon. The $50,000 of transaction costs will be treated as a note discount under current Generally Accepted Accounting Principles and the discount will be amortized as costs related to equity financing issuances. Tarpon Bay Partners Line of Credit Termination Agreement and Convertible Note On May 24, 2016, the Company and Tarpon Bay Partners LLC ("Tarpon") executed a Termination Agreement (the "Termination Agreement"), in which the parties agreed to cancel the original Equity Purchase Agreement (the "Original Purchase Agreement"), dated July 14, 2015 (except for the original Promissory Notes (the "Original Tarpon Note") which was amended and restated as set forth below), in the original amount of USD $50,000.00, issued by the Company to Tarpon as additional compensation pursuant to Original Purchase Agreement), which gave the Company the right to issue and sell to Tarpon any of the Five Million Dollars ($5,000,000) of the Company's common stock. In exchange for the Termination Agreement, the Company agreed to (a) amend and restate the terms of the Original Tarpon Note, in the form of the issuance of an amended and restated convertible redeemable note (the "Amended Tarpon Note"), in the principal amount of $50,000.00, at ten percent (10%) interest per annum commencing on July 14, 2015 (the "Effective Date"), to be due and payable to Tarpon by Company in four (4) separate equal quarterly payments of Twelve Thousand Five Hundred Dollars (USD $12,500), plus accrued interest to date, due on the first day of each quarter beginning on July 1, 2016, convertible into shares of the Company's common stock at a conversion price equal to fifty-eight percent (58%) of the lowest trading price for the ten (10) prior trading days, subject to aggregate conversion limitations of 9.99% and other terms and conditions set forth therein , and (b) execute a new Equity Purchase Agreement (the "New Purchase Agreement"), pursuant to which the Company would have the right to issue and sell to Tarpon a total of Fifteen Million Dollars ($15,000,000) of the Company's common stock, under the same terms as the Original Purchase Agreement, except for no additional compensation in lieu of the Amended Tarpon Note, to be executed on such mutually agreed upon date in the future after the Company is current on all SEC filings and is relisted on the Over-the-Counter (OTC) OTCBB and OTCQB markets. On June 30, 2017, the principal outstanding was $50,000 with accrued interest at $9,610. Convertible Redeemable Note for Unpaid Invoices On May 18, 2016, the Company and JMS Law Group PLLC ("JMS") executed a settlement letter (the "Settlement Letter") in which the parties agreed to settle unpaid invoices for services rendered by JMS to the Company in the amount of $20,000, and further agreed to pay JSM a total of $7,500 for continued services to the Company until July 31, 2016. Pursuant to the terms of the Settlement Letter, the Company issued to JMS a six month convertible redeemable note (the "Note") in the principal amount of USD $ 27,500, at a rate of ten percent (10%) per annum commencing on date of issuance , convertible into shares of the Company's common stock at a conversion price equal to the lesser of $0.01 per share or a discount of fifty-eight percent (58%) of the lowest trading price for the ten (10) prior trading days, and other customary and standard terms and conditions set forth therein. The balance of the note and accrued interest at June 30, 2017 was $31,633. Termination Agreement to Definitive Agreement for the acquisition of a new subsidiary Company and Properties of Merit Inc. ("POM") are parties to that certain Definitive Agreement, dated May 20, 2016, incorporated by reference in Form 8K filed with the SEC on May 24, 2016, pursuant to which the Company agreed to acquire one hundred percent (100%)of the ownership interest in POM, in the form of three (3) separate closings with the first closing originally anticipated on or before May 27, 2016, subject to certain performance requirements of both parties prior to each closing. The Company issued to POM a six month convertible redeemable note (the "Note") in the principal amount of USD $ 17,500, at a rate of ten percent (10%) per annum commencing on date of issuance , convertible into shares of the Company's common stock at a conversion price equal to the lesser of $0.01 per share or a discount of fifty-eight percent (58%) of the lowest trading price for the ten (10) prior trading days, and other customary and standard terms and conditions set forth therein. The balance of the note and accrued interest at June 30, 2017 was $19,910. JSJ Investments Inc. On June 11, 2015, the Company issued a 12% Convertible Note (the JSJ Note) to JSJ Investments, Inc, (JSJ) in the principal amount of $100,000 receiving cash proceeds of $88,000 after payment of related legal and broker fees. The JSJ Note bears interest at the rate of 12% per annum, and was due December 11, 2015 (the Maturity Date). The embedded conversion option qualifies for derivative accounting and bifurcation under ASC 815-15 Derivatives and Hedging Derivatives and Hedging LG Capital Funding, LLC On June 16, 2015, the Company issued a 6% Convertible Note (the LG Note) to LG Capital Funding, LLC (LG) in the principal amount of $52,500 receiving cash proceeds of $45,000 after payment or related legal and broker fees. The LG Note bears interest at the rate of 6% per annum and is due June 16, 2016 (the Maturity Date). The embedded conversion option qualifies for derivative accounting and bifurcation under ASC 815-15 Derivatives and Hedging. Pursuant to ASC 815, Derivatives and Hedging. Adar Bays, LLC On June 16, 2015, the Company issued a 6% Convertible Note (the Adar Note) to Adar Bays, LLC (Adar) in the principal amount of $52,500 receiving cash proceeds of $45,000 after payment or related legal and broker fees. The Adar Note bears interest at the rate of 6% per annum and is due June 16, 2016 (the Maturity Date). The embedded conversion option qualifies for derivative accounting and bifurcation under ASC 815-15 Derivatives and Hedging. Pursuant to ASC 815, Derivatives and Hedging. EMA Financial, LLC On July 14, 2015, (the "Note Issuance Date"), the Company entered into a Securities Purchase Agreement (the "SPA") with EMA Financial, LLC ("EMA"), whereby EMA agreed to invest $156,500 (the "Note Purchase Price") in our Company in exchange for a convertible promissory note (the "Note"). The Company netted cash proceeds $135,000 after brokerage and legal fees aggregating $21,500 was disbursed at closing. Additionally, the Company issued to EMA 100,000 shares of Common Stock of the Company as a loan fee. Pursuant to the SPA, on July 14, 2015, we issued a convertible promissory note (the "Note") to EMA, in the original principal amount of $156,500 (the "Note Purchase Price"), which bears interest at 12% per annum. All outstanding principal and accrued interest on the Note is due and payable on the maturity date, which is July 14, 2016 (the " Maturity Date"). EMA may extend the Note Maturity Date by providing written notice at least five days before the Note Maturity Date. However, EMA may only extend the Note Maturity Date for up to an additional one-year period. Any amount of principal or interest that is due under the Note, which is not paid by the Note Maturity Date, will bear interest at the rate of 24% per annum until it is paid (the "Note Default Interest"). The Note is convertible by EMA into shares of our common stock at any time on the date which is six (6) months following the Issue Date ("Prepayment Termination Date"). At any time before the Prepayment Termination Date, the Company shall have the right, exercisable on not less than five (5) Trading Days prior written notice to EMA of this Note, to prepay the outstanding balance on this Note (principal and accrued interest), in full. The conversion price is the lower of: i) the closing sale price of the Common Stock on the Principal Market on the Trading Day immediately preceding the closing date, and (ii) 60% of the lowest sale price for the Common Stock on the Principal Market during the 20 consecutive Trading Days immediately preceding the Conversion Date. EMA does not have the right to convert the Note into Common Stock if such conversion would result in EMA's beneficial ownership exceeding 4.9% of our outstanding Common Stock at that time. At the time of the filing of this Report, EMA has converted a total of $16,391 of principal into shares of the Companys common stock, resulting in a principal balance remaining of $140,109 with accrued interest at $34,940. EMA has notified the Company of a potential default and the Company has contacted them to settle the matter. No financial impact has been reported in this filing as it is indeterminate as to the reason for the default notice. The potential risk to the Company is that the default interest rate rises to 24% and the debt discount becomes 70%. Birch First Capital Fund, LLC Litigation On August 16, 2013, Birch First Capital Fund, LLC, a Delaware limited liability company, and/or Birch First Capital Management, LLC, as its manager (collectively, Birch First Capital) filed a complaint against the Company in the 15th Judicial Circuit of Florida (2013 CA 012838) alleging breach of contract under a Line of Credit Agreement (LOC) totaling $151,000. On November 18, 2013, Birch First brought a lawsuit in the 15th Judicial Circuit of Florida against Mr. Charles Cronin and Dr. Earl Beaver (former officers and directors of the Company), naming the Company as a nominal defendant. A motion to dismiss was filed by the Company concerning this derivative lawsuit, which is still currently pending. On July 23, 2015, the Parties finalized the settlement agreements, which lead to the conclusion of Case 2013 CA 012838. Settlement On July 23, 2015, the Company and Birch First Capital Fund LLC (Birch First Capital), a Delaware limited liability company and Birch First Advisors LLC, a Delaware limited liability company (Birch Advisors), executed a Settlement and Stipulation Agreement (the Settlement Agreement) dated July 21, 2015, pursuant to which the parties dismissed, with no liability admitted or deemed to be admitted by any party, any and all claims that have been, or could have been, raised in the outstanding litigation between the parties (the Litigation). On July 23, 2015, pursuant to the terms and conditions of the Settlement Agreement, the Company executed an amended and restated convertible debenture (the Amended and Restated Note) dated July 21, 2015 in the total amount of $300,000 bearing two percent (2%) interest per annum for a period of two years for the benefit of Birch First Capital. Pursuant to the terms of the Amended and Restated Note, $75,000 of the principal balance would be immediately converted at $0.10 per share for a total of 750,000 shares of the Companys Common Stock issued within five (5) days from the date of execution of the Settlement Agreement. The remaining $225,000 in principal and interest of the Amended and Restated Note will be convertible on a quarterly basis in the amount of $37,500 into shares of the Companys Common Stock at a share price equal to the lesser of $0.10 per share, or fifty percent (50%) of the three (3) lowest intraday trading average for the twenty (20) day trading period prior to each conversion date, until paid in full, with accrued and unpaid interested due and payable in the final payment, under certain terms and conditions set forth in the Amended and Restated Note. The Company recognized and expensed non-cash settlement fees aggregating $85,842. The original note contains an embedded conversion option and is separated from the Note and accounted for as a derivative instrument at fair value and discount to the Note. Using the Black-Scholes option pricing model, the fair market value of the of the of the embedded conversion option at inception was determined to be $472,028 with the following assumptions: risk-free rate of interest of .711%, expected life of 2.0 years, expected stock price volatility of 175.371%, and expected dividend yield of zero. The initial carrying value of the embedded conversion option was $472,028 exceeded the note and $225,000 was attributed to the note discount and $247,028 to a one day derivative loss. The parties agreed to amend certain parts of the Amended and Restated Note. As of December 31, 2015, Birch and the Company had not specified the terms of any such amendment, but, at the mutual agreement of the parties, no shares have been issued pursuant to the Amended and Restated Note. As of June 30, 2017, the balance outstanding on the Note was $400,000, accrued interest was $75,287. Birch Advisors, LLC On July 23, 2015, pursuant to the terms and conditions of the Settlement Agreement referenced herein, the Company executed a new Consulting and Advisory Agreement (the Agreement) dated July 21, 2015 with Birch Advisors, LLC (Consultant) for a period of twenty-four (24) months to commence upon the execution date of the signed Agreement, payable in the form of a convertible debenture (New Note) in the amount of $300,000 at two percent (2%) interest per annum for a period of two years. Pursuant to the Agreement, Consultant shall be paid $37,500 each quarter in the form of a reduction of the outstanding principal balance of the New Note, convertible into shares of the Companys Common Stock at a share price equal to the lesser of $0.10 per share or a twenty-five (25%) discount of the three (3) lowest intraday trading average for the twenty (20) day trading period prior to each conversion date, until paid in full, with accrued and unpaid interest due and payable in the final payment. The Consultant will perform advisory and consultation services to the Company, including, but not limited to, assisting Companys management with general corporate operations, business development strategies, marketing and business plans, SEC compliance and advising the Company on other ad-hoc matters as appropriate. The parties agreed that either the Company or Consultant may request a quarterly review by a designated third party reviewer, whom shall determine if the Company has the right to terminate the Agreement earlier for non-performance by the Consultant. The Agreement also contains other customary and standard provisions. The convertible note liability will be recorded as the quarterly benchmarks are reached. The original note contains an embedded conversion option and is separated from the Note and accounted for as a derivative instrument at fair value and discount to the Note. Using the Black-Scholes option pricing model, the fair market value of the of the of the embedded conversion option at inception was determined to be $84,267 with the following assumptions: risk-free rate of interest of .711%, expected life of 1.69 years, expected stock price volatility of 170.599%, and expected dividend yield of zero. The initial carrying value of the embedded conversion option was $84,267 and exceeded the note and $72,267 was attributed to the note discount and $12,000 was recorded one day derivative loss. The parties agreed to amend certain parts of the New Note that would mutually benefit each party. As of December 31, 2015, the Consultant and the Company had not specified the terms of any such amendment, but, at the request of the Consultant, no shares have been issued pursuant to the New Note. Birch completed the services during the six months for the period ended December 31, 2015, and the parties have mutually agreed to not issue the shares payable at this time. The Note payable is accrued by quarter since it depends on the services being performed. At June 30, 2017, the principal and accrued interest under the Note was $300,000 and $56,702, respectively. First Amendment to the Settlement Agreement On May 18, 2016, the Company and Birch First Capital Fund LLC ("Birch First Capital") and Birch First Advisors LLC ("Birch Advisors") executed the First Amendment to the Settlement Agreement (the "First Amendment"), pursuant to which the parties mutually agreed to amend and restate the amended and restated convertible debenture (the "Original Amended Note") in the original amount of USD $300,000 (the "Original Amended Note Amount"), the convertible debenture (the "Original New Note") in the original amount of USD $300,000 (the "Original New Note Amount") and the original consulting agreement (the "Original Consulting Agreement") dated on or about July 23, 2015, to reflect the following: (a) the execution of an Amended and Restated Convertible Redeemable Note (the "Amended and Restated Redeemable Note No.1") in the principal amount of USD $400,000, at a rate of ten percent (10%) per annum with interest commencing on July 23, 2015, convertible into shares of the Company's common stock at a conversion price equal to the lesser of $0.01 per share or a discount of fifty-eight percent (58%) of the lowest trading price for the ten (10) prior trading days, and other terms and conditions set forth therein, (b) the issuance by Company to Birch First Capital a three-year "cashless" stock purchase warrant (the "Warrant No.1") for the right to purchase a total of 4,000,000 shares of Series B preferred Stock of the Company (the "Preferred Warrant Shares"), at a purchase price of $0.001 per share, on the terms and conditions set forth therein, (c) the execution of an Amended and Restated Convertible Redeemable Note (the "Amended and Restated Redeemable Note No. 2") in the principal amount of USD $300,000, at a rate of ten percent (10%) per annum commencing on July 23, 2015, convertible into shares of the Company's common stock at a conversion price equal to the lesser of $0.01 per share or a discount of fifty-eight percent (58%) of the lowest trading price for the ten (10) prior trading days, subject to aggregate conversion limitations of 4.99% and other terms and conditions set forth therein, (d) the execution of an Amended and Restated Consulting Agreement (the "Amended and Restated Consulting Agreement") on the terms and conditions set forth therein, including, but not limited to, for a period of twenty-four (24) months, with consideration payable to Birch Advisors and/or its assigns in cash in the amount of Ten Thousand Dollars ($10,000.00) per month, including, any and all payments set forth Amended and Restated Redeemable Note No.2, and the issuance by the Company to Birch First Advisors and/or assigns a three-year "cashless" stock purchase warrant (the "Warrant No.2") for the right to purchase up to 1,000,000 shares of common stock of the Company (the "Common Warrant Shares") each month a strike price of $0.001 per share (the "Exercise Price"), and (e) the acceptance by the Company of the execution of the Assignment of Amended and Restated Redeemable Note No.2 (hereinafter referred to as the "Assigned Note") between Birch Advisors and Birch First Capital, in which Birch Advisors agreed to assign the ownership interest of Assigned Note to Birch First Capital, on the terms and conditions set forth therein, of which the Company was not a party, however, provided consent at the request of Birch Advisors and Birch First Capital. In addition, each of the agreements contains customary representations and warranties provisions. Third Amendment; Securities Purchase Agreement and Joint Venture Agreement On May 20, 2016, the Company and H Y H Investments, S.A. ("HYHI") executed the Third Amendment to the Securities Purchase Agreement (the "Third Amendment"), pursuant to which the parties agreed to further clarify and amend and restate certain provisions of the Original Purchase Agreement, First Amendment and Second Amendment (the "Original Purchase Agreement"). Pursuant to the terms of the Third Amendment, the parties mutually agreed to cancel the Original Purchase Agreement dated April 6, 2015, in exchange for a new Joint Venture Agreement (the "Joint Venture") executed on even date therewith, pursuant to which the Company and HYHI agreed to create a joint venture relationship using Elite Data Holdings S.A., a Honduras corporation, a wholly-owned subsidiary of Elite Gaming Ventures LLC, a Florida limited liability company ("EVG"), a wholly-owned subsidiary of the Company, and a distributor license from HYHI and El Mar Muerto Beauty Mineral, S.A., a Honduras corporation ("EMBM") to establish gaming operations (the "Purpose") by distributing and maintaining a total of eighty (80) slot machines in the cities of La Lima, Cortes; eighty (80) slot machines in the cities of Trujillo, Colon; and One Hundred and Sixty (160) slot machines in Roatan in the bay island of Honduras. In addition, the Company and EVG agreed to pay HYHI consideration in the total amount of USD $10,000,000 (the "Total Consideration"), including, but not limited to a convertible note, a revenue share plan, and an initial amount of $100,000, which was paid in the Original Purchase Agreement, as amended, and is the same $100,000 deposit described in this Note 4. Joint Venture Termination Agreement, Note Modification, and Assignment; Transfer of Subsidiary On or about March 14, 2017, the Company and H Y H Investments, S.A. (HYHI), a Honduras corporation executed a Joint Venture Termination Agreement (the JV Termination Agreement), in which the entire Joint Venture set forth in the original Joint Venture Agreement (the Joint Venture), dated May 20, 2016, was rendered null and void, except for the validity and enforceability of a total of Three Million Nine Hundred Thousand Dollars (US$3,900,000) represented by the first eight (8) quarterly payments of the original Amended and Restated Redeemable Note issued on or about May 20, 2016 in the amended principal amount of Four Million Nine Hundred Thousand Dollars (USD $4,900,000), in relation to the following payments: (A) two (2) separate payments of Four Hundred Fifty Thousand Dollars (USD $450,000), plus accrued interest to date, due on July 1, 2016 and October 1, 2016, respectively, for a total of Nine Hundred Thousand Dollars (USD $900,000), and payable in cash or convertible into shares of common stock of DEAC at a conversion price equal to the lesser of $0.01 per share or fifty percent (50%) to the five (5) trading day average closing price immediately preceding the payment date, and (B) the remaining balance of Four Million (USD $4,000,000) payable in cash in a total of eight (8) equal quarterly installments of Five Hundred Thousand Dollars (USD $500,000), plus accrued interest to date, on the first day of each quarter beginning with January 1, 2017 and ending on January 1, 2019, convertible into shares of common stock of DEAC at fifty percent (50%) discount to the five (5) trading day average closing price immediately preceding the payment date, and other terms more fully described in the amended note set forth in the Amended and Restate Redeemable Note, thus cancelling the final two (2) quarterly payments (seventh and eighth quarterly payments) of Five Hundred Thousand Dollars (USD $500,000) each for a reduction of One Million Dollars (UD$1,000,000) of the principal amount of the Amended and Restated Redeemable Note, pursuant to the terms of the Note Cancellation and Extinguishment Agreement (the Note Cancellation Agreement), attached as Exhibit A to the JV Termination Agreement, and any and all existing operations, including, but not limited to, all of the assets and liabilities of the Joint Venture remained in Elite Data Holdings S.A., a Honduras corporation (EDH), as a wholly-owned subsidiary of Elite Gaming Ventures LLC, a Florida limited liability company (EGV), with the ownership interest of EGV assigned and transferred to HYHI and/or its assigns as set forth in the Assignment (the Assignment), attached as Exhibit A-1 to the Note Cancellation Agreement, including other terms and conditions set forth therein. The termination of the Joint Venture resulted in Elite Gaming Ventures LLC (and, its wholly-owned subsidiary, Elite Data Holdings S.A.) no longer being a subsidiary of the Company, with no further operational effect or obligation to the Company, except for certain amounts owed by the Company under a further amendment to the Amended and Restated Redeemable Note. The reduction of $1,000,000 of the Note is recorded in these financial statements as a gain on settlement. The Note balance and accrued interest were $3,900,000 and $705,278, respectively at June 30, 2017. Rimlinger Note On or about January 10, 2017, the Company and Charles Rimlinger, an individual (the former Chief Executive Officer and Director of the Company) (the "Rimlinger") executed a Separation and Settlement Agreement (the Rimlinger Settlement Agreement), pursuant to the termination of his service as an officer and director of the Company, in exchange for the issuance of a one year Convertible Redeemable Note (the "Rimlinger Note") in the principal amount of USD $40,000, at a rate of ten percent (10%) per annum commencing on date of issuance, convertible into shares of the Company's common stock at a conversion price equal to the lesser of $0.01 per share or a discount of fifty-eight percent (58%) of the lowest trading price for the ten (10) prior trading days, and other terms and conditions set forth therein. The Note balance and accrued interest at June 30, 2017 were $40,000 and $1,900, respectively. Ricketts Note On or about January 10, 2017, the Company and Dr. James G. Ricketts, an individual (the former Chairman of the Board and VP of Investor Relations of the Company) (the "Ricketts") executed a Separation and Settlement Agreement (the Ricketts Settlement Agreement) in which the parties terminated both the Contractor Agreement (Ricketts Contractor) dated on or about May 18, 2016, and the Board Member Service Agreement (Ricketts Board Agreement) dated on or about May 18, 2016, in exchange for the issuance of a one year Convertible Redeemable Note (the "Ricketts Note") in the principal amount of USD $40,000, at a rate of ten percent (10%) per annum commencing on date of issuance, convertible into shares of the Company's common stock at a conversion price equal to the lesser of $0.01 per share or a discount of fifty-eight percent (58%) of the lowest trading price for the ten (10) prior trading days, and other terms and conditions set forth therein. The Note balance and accrued interest at June 30, 2017 were $40,000 and $1,900, respectively. Ricketts returned 500,000 Series B Preferred shares in settlement valued at $2,500,000 recorded as a gain on settlement in the financial statements included in this filing. Antol Note On January 10, 2017, the Company and Stephen Antol, an individual (the former Chief Financial Officer, Secretary and Treasurer of the Company) (the "Ricketts") executed a Separation and Settlement Agreement (the Settlement Agreement) in which the parties terminated the Contractor Agreement (Antol Contractor) dated on or about May 18, 2016, in exchange for the issuance of a one year Convertible Redeemable Note (the "Antol Note") in the principal amount of USD $40,000, at a rate of ten percent (10%) per annum commencing on date of issuance, convertible into shares of the Company's common stock at a conversion price equal to the lesser of $0.01 per share or a discount of fifty-eight percent (58%) of the lowest trading price for the ten (10) prior trading days, and other terms and conditions set forth therein. The Note balance and accrued interest at June 30, 2017 were $40,000 and $1,900, respectively. Antol returned 500,000 Series B Preferred shares in settlement valued at $2,500,000 recorded as a gain on settlement in the financial statements included in this filing. WOD Note On August 26, 2016, WOD Markets LLC advanced a total of Forty Thousand Dollars ($40,000) to DEAC for the purposes of funding the completion of DEACs audit and required SEC filings, secured by two (2) separately executed Convertible Redeemable Notes (WOD Notes). These notes bear no interest and are repayable should the acquisition of WOD Markets LLC fails to be completed within the terms of the amended purchase agreement and subsequent joint venture agreement that terminates if not funded December 31, 2018. At June 30, 2017, the Note balance and accrued interest were $40,000 and $3,395, respectively. Current portion $ 5,080,945 Convertible notes, long term portion HYHI $ 500,000 |
DERIVATIVE INSTRUMENT LIABILITI
DERIVATIVE INSTRUMENT LIABILITIES | 6 Months Ended |
Jun. 30, 2017 | |
Notes to Financial Statements | |
NOTE 6 - DERIVATIVE INSTRUMENT LIABILITIES | The fair market value of the derivative instruments liabilities at June 30, 2017, was determined to be $6,130,405 with the following assumptions: (1) risk free interest rate of .84%, (2) remaining contractual life of .01 years to .54 years, (3) expected stock price volatility of 409% to 627%, and (4) expected dividend yield of zero. Based upon the change in fair value, the Company has recorded a gain on derivative instruments for the six months ended June 30, 2017, of $264,504 and a corresponding decrease in the derivative instruments liability. The entire amount of derivative instrument liabilities are classified as current due to the fact that settlement of the derivative instruments could be required within twelve months of the balance sheet date. |
FAIR VALUE MEASUREMENT
FAIR VALUE MEASUREMENT | 6 Months Ended |
Jun. 30, 2017 | |
Notes to Financial Statements | |
NOTE 7 - FAIR VALUE MEASUREMENT | The Company values its derivative instruments under FASB ASC 820 which defines fair value, establishes a framework for measuring fair value, and expands disclosures about fair value measurements. Fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date (exit price). The Company utilizes market data or assumptions that market participants would use in pricing the asset or liability, including assumptions about risk and the risks inherent in the inputs to the valuation technique. These inputs can be readily observable, market corroborated, or generally unobservable. The Company classifies fair value balances based on the observability of those inputs. ASC 820 establishes a fair value hierarchy that prioritizes the inputs used to measure fair value. The hierarchy gives the highest priority to unadjusted quoted prices in active markets for identical assets or liabilities (level 1 measurement) and the lowest priority to unobservable inputs (level 3 measurement). The three levels of the fair value hierarchy are as follows: Level 1 - Quoted prices are available in active markets for identical assets or liabilities as of the reporting date. Active markets are those in which transactions for the asset or liability occur in sufficient frequency and volume to provide pricing information on an ongoing basis. Level 1 primarily consists of financial instruments such as exchange-traded derivatives, marketable securities and listed equities. Level 2 - Pricing inputs are other than quoted prices in active markets included in level 1, which are either directly or indirectly observable as of the reported date. Level 3 - Pricing inputs include significant inputs that are generally less observable from objective sources. These inputs may be used with internally developed methodologies that result in managements best estimate of fair value. The Company's financial instruments consisted of cash, prepaid expense, deposit, accounts payable and accrued liabilities, line of credit, loan from stockholders and convertible debt. The estimated fair value of cash, prepaid expense, deposit, accounts payable and accrued liabilities, line of credit, loan from stockholders approximates its carrying amount due to the short maturity of these instruments. The recognition of the derivative values of convertible debt are based on the weighted-average Black-Scholes option pricing model, which the Companys classifies as a level three of the fair value measurement hierarchy. The derivative liabilities are measured at fair value using quoted market prices and estimated volatility factors based on historical quoted market prices for the Company's common stock, and are classified within Level 3 of the valuation hierarchy. The following table provides the assets and liabilities carried at fair value measured on a recurring basis as of December 31, 2016. Level 1 Level 2 Level 3 Total Derivative Liabilities $ - $ - $ 5,721,145 $ 5,721,145 The following table provides the assets and liabilities carried at fair value measured on a recurring basis as of June 30, 2017. Level 1 Level 2 Level 3 Total Derivative Liabilities $ - $ - $ 6,130,405 $ 6,130,405 As of June 30, 2017, the Company had a derivative liability amount of $6,130,405 which was classified as a Level 3 financial instrument. |
EQUITY INCENTIVE PLAN
EQUITY INCENTIVE PLAN | 6 Months Ended |
Jun. 30, 2017 | |
Notes to Financial Statements | |
NOTE 8 - EQUITY INCENTIVE PLAN | Effective October 15, 2015, the Company adopted the Equity Incentive Plan (the Plan) whereby the Company may issue common stock, not to exceed 25,000,000 shares of common stock of the Company (the Stock Award Stock Awards Option Options Stock ISOs Code NQSOs Pursuant to the Plan, the exercise price of stock awards or options granted under the plan which are designated as NQSOs shall not be less than 85% of the fair market value of the stock subject to the Option on the date of grant, and not less than 65% of the fair market value of the stock subject to the Stock Award on the date of grant. To the extent required by applicable laws, rules and regulations, the exercise price of a NQSO granted to any person who owns, directly or by attribution of stock possessing more than ten percent of the total combined voting power of all classes of stock of the Company or of any Subsidiary (a Ten Percent Stockholder) shall in no event be less than 110% of the fair market value of the stock covered by the Stock Award or Option at the time the Stock Award or Option is granted. Pursuant to the Plan, the exercise price of stock awards or options granted under the Plan which are designated as ISOs shall not be less than the fair market value of the stock covered by the stock award or option at the time the option is granted. The exercise price of an ISO granted to any Ten Percent Stockholder shall in no event be less than 110% of the fair market value. The fair market value is defined as the closing price of such stock on the date before the date the value is to be determined on the principal recognized securities exchange or recognized securities market on which such stock is reported. If selling prices are not reported, its fair market value shall be the mean between the high bid and low asked prices for such stock on the date before the date the value is to be determined (or if there are no quoted prices for such date, then for the last preceding business day on which there were quoted prices). If there is no established market for the stock, the fair market value will be determined in good faith by the Administer. The Administer will either be the Board of Directors or an Administer appointed by the Board of Directors. We do not have outstanding stock awards or options to purchase shares of our common stock under the Plan at June 30, 2017. |
STOCKHOLDERS' DEFICIT
STOCKHOLDERS' DEFICIT | 6 Months Ended |
Jun. 30, 2017 | |
Notes to Financial Statements | |
Note 9 - STOCKHOLDERS' DEFICIT | Authorized The Company is authorized to issue 250,000,000 shares of preferred stock, having a par value of $0.0001 per share, and 500,000,000 shares of common stock, having a par value of $0.0001 per share. Effective October 15, 2015, the Company Restated its Articles of Incorporation and Bylaws, and Equity Incentive Plan increasing the total number of shares of stock of all classes which we shall have authority to issue from 60,000,000 shares to 750,000,000 shares, of which the Common Stock, $0.0001 par value per share, was increased from 50,000,000 shares to 500,000,000 shares (hereinafter called "Common Stock") and of which the Preferred Stock, $0.0001 par value per share, was increased from 10,000,000 shares to 250,000,000 shares (hereinafter called "Preferred Stock"). On May 17, 2016, the Company filed a Designation of Rights and Preferences for Series B Preferred stock authorizing 100,000,000 share to be issued under this designation. The Series B Preferred shares have a par value $.0001 and are senior to all other shares authorized by the Company. These share vote as if converted at a ratio of 1:1,000 and vote as a single class. Issued and Outstanding Preferred Stock At June 30, 2017, the Company there had 1,100,000 Preferred Series B shares outstanding. On May 18, 2016, the Company authorized the issuance of 2,000,000 shares of Series B Preferred Stock to two (2) separate parties in the amount of 1,000,000 shares each to Ricketts and Antol, respectively, pursuant to the executed Ricketts Subscription Agreement and Antol Subscription Agreement. The Series B Preferred shares were offered and sold to the parties in a private placement transaction in reliance upon exemptions from registration pursuant to Section 4(2) of the Securities Act of 1933, as amended. The Company based such reliance on certain representations made by each of the parties to the Company including that each of the parties were accredited investor s as defined in Rule 501 of Regulation D. These shares were not issued in this quarter and have been recorded in the financial statements for the year ended December 31, 2016. On January 10, 2017, Antol and Ricketts returned 500,000 Series B Preferred shares each to the Company with a gain on the transaction to the Company of $5,000,000. Voting Trust - Change of Control The deposit of the Series B Preferred Stock on March 14, 2017 from Ricketts and Antol into the Voting Trust creates a change of control with the Trustee having voting rights of 1,100,000,000 shares as a class pursuant to the preferences in the Series B Preferred Stock designation. This also makes the Voting Trust a related party. Common Stock At June 30, 2017, the Company has 150,018,799 shares of common stock issued and outstanding. During the period from January 1, 2016 through June 30, 2017, the Company issued 114,015,033 shares of common stock for the conversion of $661,854 and $ 281 in accrued interest. Warrants Issued for Services As of June 30, 2017, the Company had no outstanding warrants for services. The following table summarizes the warrant activity for the six months ended June 30, 2017: Balance December 31, 2016 - - $ - Granted Exercised Expired/ Cancelled - (259 ) Balance June 30, 2017 - $ - Warrants Issued In Settlements Balance December 31, 2016 7,000,000 700 Granted Preferred Granted Common Exercised Expired/ Cancelled Balance June 30, 2017 7,000,000 700 |
JOINT VENTURE
JOINT VENTURE | 6 Months Ended |
Jun. 30, 2017 | |
Notes to Financial Statements | |
NOTE 10 - Joint Venture | On or about March 14, 2017, the Company WOD Holdings Inc., a Delaware corporation (WODH) executed a Joint Venture Agreement (the Joint Venture Agreement) pursuant to Exhibit I of the Amendment No. 2 to the Definitive Agreement (the Amendment No. 2), whereby the parties agreed to form a Joint Venture (the Joint Venture) to further develop and manage the current business of WOD Market LLC, a Colorado limited liability company, as a provider of intelligent retail solutions for gym owners and coaches, including the management of retail sales, up front inventory purchases, ongoing inventory management, payments, marketing, and related services. This Joint Venture Agreement began immediately upon signing on March 14, 2017. Under the terms of the Joint Venture, the initial ownership interest of WOD was 20% owned by the Company, with the remaining 80% owned WODH, with the option of Company to provide additional capital contributions to WOD in increments of not less than $10,000 up to a total of $8 million dollars in the aggregate, which included an equity exchange of up to a total of 800 units (80%) of WOD owned initially by WODH to the Company for a total of approximately 199,000 shares of Series B Preferred Stock and approximately 18,801,000 shares of Common Stock of the Company (the Shares) to be issued to WODH upon the completion of a final closing on or before December 31, 2018, under the terms set forth in Amendment No. 2. The Joint Venture terminates at the earlier of the completion of the final closing equity exchange or December 31, 2018, whichever occurs first. Until a minimum of at least $4 million in additional capital contributions have been made by the Company to WOD, resulting in a controlling ownership interest of not less than 60% of WOD by the Company, all the Shares of Company stock earmarked for the equity exchange with WODH is being held in a Voting Trust (as defined elsewhere in this filing), along with other key shareholder positions, in order to recapitalize the Company post a 1:1000 reverse split (which was previously approved), pending effectiveness after the Company becomes a current and fully-reporting public company. WOD MARKETS LLC WOD MARKETS LLC Three Months Year BALANCE SHEET INCOME STATEMENT June 30, To June 30, 2017 June 30, 2017 2017 Date ASSETS SALES $ 21,962 $ 43,427 Cash $ 3,141 COST OF GOODS 12,731 26,448 Note receivable 30,000 GROSS PROFIT 9,231 16,978 Inventory 18,801 Total Current Assets 51,942 EXPENSES Interest 3,193 4,603 Fixed Assets, net 43,953 Depreciation 1,614 3,228 Total Assets $ 95,895 Rent 7,420 14,094 General and Administrative 4,380 8,751 LIABILITIES Total Expense 16,607 30,676 Accounts payable $ 47,685 Net Loss $ (7,376 ) $ (13,698 ) Notes payable 35,593 Total Liabilities 83,278 EQUITY Membership 19,600 Retained earnings (6,983 ) Total Membership 12,617 Total Liabilities and Equity $ 95,895 Contractor Agreements On or about March 14, 2017, the Company and Brenton Mix, an individual (and, also the Chairman, Chief Executive Officer, President and Chief Financial Officer of the Company) (Mix) executed a Contractor Agreement (the "Mix Agreement") to formalize the engagement Mix (pursuant to his original appointment dated January 10, 2017) for his continued services to the Company and for such other services, as deemed necessary by the Board of Directors, from time to time, for a period of three (3) years from the date of execution, and renewal for two (2) successive one (1) year terms unless terminated early. The Company agreed to compensate Mix in the form of (a) a total of $10,000 per month for the first year, $12,500 per month for the second year, $15,000 per month for the third year, and $20,000 per month for subsequent terms, payable in cash or converted into restricted common stock of the Company, at Mixs discretion, pursuant to the Company's Stock Option Plan then in effect, and (b) the right to participate in future stock options then in effect, including other terms and conditions set forth therein. On or about March 14, 2017, the Company and Richard Phillips, an individual (and, also the Secretary, Treasurer and Director of the Company) (Phillips) executed a Contractor Agreement (the "Phillips Agreement") to formalize the engagement Phillips (pursuant to his original appointment dated January 10, 2107 and further appointment on March 14, 2017) for his continued services to the Company and for such other services, as deemed necessary by the Board of Directors, from time to time, for a period of two (2) years from the date of execution, and renewal for three (3) successive one (1) year terms unless terminated early. The Company agreed to compensate Phillips in the form of (a) a total of $1,250 per month for the first six months of the first year, $2,500 per month for the second six months of the first year, $5,000 per month for the second year and for subsequent terms, payable in cash or converted into restricted common stock of the Company, at Phillipss discretion, pursuant to the Company's Stock Option Plan then in effect, and (b) the right to participate in future stock options then in effect, including other terms and conditions set forth therein. |
SUBSEQUENT EVENTS
SUBSEQUENT EVENTS | 6 Months Ended |
Jun. 30, 2017 | |
Notes to Financial Statements | |
NOTE 11 - SUBSEQUENT EVENTS | Subsequent to our six months ended June 30, 2017 and the date of this Report, the Company issued the following shares of common stock in connection with the convertible notes and took the following actions: On August 29, 2017, the Company filed a Definitive 14C with the following provisions. The purpose of this Information Statement is to inform the holders of record, as of the close of business on August 4, 2017 (the Record Date), of shares of all series of stock with voting power of Elite Data Services, Inc., a Florida corporation (the Company, or the Corporation), that our Board of Directors and majority shareholder of approximately 100.00% of our Series B preferred stock , having voting rights equal to 1000:1 and representing approximately 88.00% of total voting rights, as of the Record Date have giving written consent as of August 4, 2017, to approve the following: (a) To change of corporate name from Elite Data Services Inc. to WOD Retail Solutions Inc. (b) To increase the authorized capital stock of the Corporation to 10,500,000,000 shares, of which 10,000,000,000 shares shall be Common stock, par value $ 0.0001, and 500,000,000 shares shall be preferred stock, par value $0.0001, as set forth on the proposed Amendment to the Amend and Restated Articles of Incorporation, attached hereto as Exhibit A; (c) To pre-approve up to 1 for 10,000 reverse stock split, which shall be effected at the sole discretion of the Board of Directors at any time on or before December 31, 2017, and after the date that is 20 calendar days after the mailing of this Information Statement. On August 4, 2017, our Board of Directors and one shareholder who holds a majority of our outstanding Series B Preferred Stock, having voting rights equal to 1000:1 and representing approximately 88.00% of total voting rights, executed a written consent in favor of the actions described above that is described in greater detail in the Information Statement accompanying this notice. This consent will satisfy the stockholder approval requirement for the proposed action. The foregoing actions will not become effective before a date, which is twenty (20) calendar days after this Information Statement is first provided to Stockholders. The entire cost of furnishing this Information Statement will be borne by the Company. On October 26, 2017, the Company issued 7,363,900 common shares for the conversion of $736.39 of convertible debt. On November 17, 2017, the Company issued 7,491,667 common shares for the conversion of $1,123.75 of convertible debt. On December 1, 2017, the Company issued 8,175,000 common shares for the conversion of $408.75 of convertible debt. On December 13, 2017, the Company issued 24,350,921 common shares for the conversion of $1,483.41 of convertible debt. On December 14, 2017, the Company issued 8,050,000 common shares for the conversion of $402.50 of convertible debt. |
SUMMARY OF SIGNIFICANT ACCOUN17
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Policies) | 6 Months Ended |
Jun. 30, 2017 | |
Summary Of Significant Accounting Policies Policies | |
Principles of Consolidation | The consolidated financial statements have been prepared in accordance with generally accepted accounting principles and include the accounts of the Company and its subsidiaries, Dynamic Energy Development Corp. and Transformation Consulting, Inc. All intercompany balances 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 and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. The Company regularly evaluates estimates and assumptions related to intangible assets and deferred income tax asset valuation allowances. The Company bases its estimates and assumptions on current facts, historical experience and various other factors that it believes to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities and the accrual of costs and expenses that are not readily apparent from other sources. The actual results experienced by the Company may differ materially and adversely from the Companys estimates. To the extent there are material differences between the estimates and the actual results, future results of operations will be affected. |
Reclassifications | Certain reclassifications have been made in Statement of Operations for the year 2016 to the period ended March 31, 2017. These reclassifications impacted the classification of certain items within the Statement of Operations: relating to classification of interest expense. The reclassifications had no impact on previously reported total operating expenses, net loss, or stockholders' deficit. |
Development Costs | Development costs are expensed in the period they are incurred unless they meet specific criteria related to technical, market and financial feasibility, as determined by management, including but not limited to the establishment of a clearly defined future market for the product, and the availability of adequate resources to complete the project. If all criteria are met, the costs are deferred and amortized over the expected useful life, or written off if a product is abandoned. For the six months ended June 30, 2017, the Company incurred no development costs. As of June 30, 2017, the Company had no deferred product development costs. |
Income Taxes | Potential benefits of income tax losses are not recognized in the accounts until realization is more likely than not. The Company has adopted the accounting standards codified in ASC 740, Income Taxes as of its inception. Pursuant to those standards, the Company is required to compute tax asset benefits for net operating losses carried forward. Potential benefit of net operating losses have not been recognized in these financial statements because the Company cannot be assured it is more likely than not that it will utilize the net operating losses carried forward in future years. ASC 740-10-25 prescribes recognition thresholds that must be met before a tax position is recognized in the financial statements and provides guidance on de-recognition, classification, interest and penalties, accounting in interim periods, disclosure, and transition. An entity may only recognize or continue to recognize tax positions that meet a "more likely than not" threshold. Based on its evaluation, the Company has concluded that there are no significant uncertain tax positions requiring recognition in its financial statements. The Company does not have any unrecognized tax benefits as of June 30, 2017 that, if recognized, would affect the Company's effective income tax rate. The Company's policy is to recognize interest and penalties related to income tax issues as components of income tax expense. The Company did not recognize or have any accrual for interest and penalties relating to income taxes as of June 30, 2017 and December 31, 2016. |
Cash and Cash Equivalents | Cash include all highly liquid instruments with an original maturity of three months or less at the date of purchase. The Company maintains its cash in cash deposit accounts, which are insured by the Federal Deposit Insurance Corporation (FDIC) up to $250,000 per legal ownership. At times, the Companys accounts may exceed federally insured limits. To date, the Company has not experienced any losses in such accounts. At June 30, 2017, the Company had no cash equivalents. |
Fair Value of Financial Instruments | The Companys financial instruments consist of cash, accounts payable, accrued liabilities, line of credit payable, loans from a related party, contingent consideration payable, and convertible note payable. The carrying amount of these financial instruments approximates fair value due either to length of maturity or interest rates that approximate prevailing market rates unless otherwise disclosed in these financial statements. |
Fair Value Measurement | The Company values its derivative instruments under FASB ASC 820 which defines fair value, establishes a framework for measuring fair value, and expands disclosures about fair value measurements. Fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date (exit price). The Company utilizes market data or assumptions that market participants would use in pricing the asset or liability, including assumptions about risk and the risks inherent in the inputs to the valuation technique. These inputs can be readily observable, market corroborated, or generally unobservable. The Company classifies fair value balances based on the observability of those inputs. ASC 820 establishes a fair value hierarchy that prioritizes the inputs used to measure fair value. The hierarchy gives the highest priority to unadjusted quoted prices in active markets for identical assets or liabilities (level 1 measurement) and the lowest priority to unobservable inputs (level 3 measurement). The three levels of the fair value hierarchy are as follows: Level 1 Quoted prices are available in active markets for identical assets or liabilities as of the reporting date. Active markets are those in which transactions for the asset or liability occur in sufficient frequency and volume to provide pricing information on an ongoing basis. Level 1 primarily consists of financial instruments such as exchange-traded derivatives, marketable securities and listed equities. Level 2 Pricing inputs are other than quoted prices in active markets included in level 1, which are either directly or indirectly observable as of the reported date. Level 3 Pricing inputs include significant inputs that are generally less observable from objective sources. These inputs may be used with internally developed methodologies that result in managements best estimate of fair value. The Company's financial instruments consisted of cash, prepaid expense, deposit, accounts payable and accrued liabilities, line of credit, loan from stockholders and convertible debt. The estimated fair value of cash, prepaid expense, deposit, accounts payable and accrued liabilities, line of credit, loan from stockholders approximates its carrying amount due to the short maturity of these instruments. The recognition of the derivative values of convertible debt are based on the weighted-average Black-Scholes option pricing model. |
Revenue Recognition | The Company recognizes revenue in accordance with the FASB ASC Section 605-10-S99, Revenue Recognition, Overall, SEC Materials ("Section 605-10-S99"). Section 605-10-S99 requires that four basic criteria must be met before revenue can be recognized: (1) persuasive evidence of an arrangement exists; (2) delivery has occurred or services rendered; (3) the fee is fixed and determinable; and (4) collectability is reasonably assured. |
Impairment of Long-Lived Intangible Assets | We review our long-lived assets, including intangible assets subject to amortization, for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. Impairment, if any, is measured as the excess of the carrying amount over the fair value based on market value (when available) or discounted expected cash flows of those assets, and is recorded in the period in which the determination is made. Intangible assets not subject to amortization are tested annually for impairment and more frequently if events or changes in circumstances indicate that it is more likely than not that the asset is impaired. |
Net Income (Loss) Per Common Share | Basic loss per common share (EPS) is calculated by dividing the net loss available to common shareholders by the weighted average number of common shares outstanding for the period. Diluted EPS reflects the potential dilution that could occur if securities or other contracts to issue common stock were exercised or converted into common stock. The number of common shares that are exercisable or converted into common stock is not material to affect diluted EPS results. Further, since the Company shows losses for the periods presented basic and diluted loss per share are the same for all periods presented. |
Common Share Non-Monetary Consideration | In situations where common shares are issued and the fair value of the goods or services received is not readily determinable, the fair value of the common shares is used to measure and record the transaction. The fair value of the common shares issued in exchange for the receipt of goods and services is based on the stock price as of the earliest of the date at which: i The counterpartys performance is complete; ii. commitment for performance by the counterparty to earn the common shares is reached; or iii. the common shares are issued if they are fully vested and non-forfeitable at that date. |
Stock-Based Compensation | On December 1, 2005, the Company adopted the fair value recognition provisions codified in ASC 718, Compensation-Stock Compensation. The Company adopted those provisions using the modified-prospective-transition method. Under this method, compensation cost recognized for all periods prior to December 1, 2005 includes: a) compensation cost for all share-based payments granted prior to, but not yet vested as of November 30, 2005, based on the grant-date fair value and b) compensation cost for all share-based payments granted subsequent to November 30, 2005, based on the grant-date fair value. In addition, deferred stock compensation related to non-vested options is required to be eliminated against additional paid-in capital. The results for periods prior to December 1, 2005 were not restated. The Company accounts for equity instruments issued in exchange for the receipt of goods or services from parties other than employees in accordance with ASC 505, Equity. Costs are measured at the estimated fair market value of the consideration received or the estimated fair value of the equity instruments issued, whichever is more reliably measurable. The value of equity instruments issued for consideration other than employee services is determined on the earliest of a performance commitment or completion of performance by the counterparty. |
Share Purchase Warrants | The Company accounts for common share purchase warrants at fair value in accordance with ASC 815, Derivatives and Hedging. The Black-Scholes option pricing valuation method is used to determine fair value of these warrants. Use of this method requires that the Company make assumptions regarding stock volatility, dividend yields, expected term of the warrants and risk-free interest rates. |
Recently Issued Accounting Pronouncements | Other than as set forth below, management does not believe that any recently issued, but not yet effective accounting pronouncements, if adopted, would have a material effect on the accompanying financial statements. None. |
CONVERTIBLE PROMISSORY NOTE (Ta
CONVERTIBLE PROMISSORY NOTE (Tables) | 6 Months Ended |
Jun. 30, 2017 | |
Convertible Promissory Note Tables | |
WOD Note | Current portion $ 5,080,945 Convertible notes, long term portion HYHI $ 500,000 |
FAIR VALUE MEASUREMENT (Tables)
FAIR VALUE MEASUREMENT (Tables) | 6 Months Ended |
Jun. 30, 2017 | |
Fair Value Measurement Tables | |
Fair value of derivative liabilities | The following table provides the assets and liabilities carried at fair value measured on a recurring basis as of December 31, 2016. Level 1 Level 2 Level 3 Total Derivative Liabilities $ - $ - $ 5,721,145 $ 5,721,145 The following table provides the assets and liabilities carried at fair value measured on a recurring basis as of June 30, 2017. Level 1 Level 2 Level 3 Total Derivative Liabilities $ - $ - $ 6,130,405 $ 6,130,405 |
STOCKHOLDERS' DEFICIT (Tables)
STOCKHOLDERS' DEFICIT (Tables) | 6 Months Ended |
Jun. 30, 2017 | |
Stockholders Deficit Tables | |
Summarizes the warrant activity | Balance December 31, 2016 - - $ - Granted Exercised Expired/ Cancelled - (259 ) Balance June 30, 2017 - $ - |
Warrants Issued In Settlements | Balance December 31, 2016 7,000,000 700 Granted Preferred Granted Common Exercised Expired/ Cancelled Balance June 30, 2017 7,000,000 700 |
JOINT VENTURE (Table)
JOINT VENTURE (Table) | 6 Months Ended |
Jun. 30, 2017 | |
Joint Venture Table | |
Schedule of joint venture financial tables | WOD MARKETS LLC WOD MARKETS LLC Three Months Year BALANCE SHEET INCOME STATEMENT June 30, To June 30, 2017 June 30, 2017 2017 Date ASSETS SALES $ 21,962 $ 43,427 Cash $ 3,141 COST OF GOODS 12,731 26,448 Note receivable 30,000 GROSS PROFIT 9,231 16,978 Inventory 18,801 Total Current Assets 51,942 EXPENSES Interest 3,193 4,603 Fixed Assets, net 43,953 Depreciation 1,614 3,228 Total Assets $ 95,895 Rent 7,420 14,094 General and Administrative 4,380 8,751 LIABILITIES Total Expense 16,607 30,676 Accounts payable $ 47,685 Net Loss $ (7,376 ) $ (13,698 ) Notes payable 35,593 Total Liabilities 83,278 EQUITY Membership 19,600 Retained earnings (6,983 ) Total Membership 12,617 Total Liabilities and Equity $ 95,895 |
DESCRIPTION OF BUSINESS (Detail
DESCRIPTION OF BUSINESS (Details Narratvie) - WOD [Member] - USD ($) | 1 Months Ended | 6 Months Ended |
Aug. 26, 2016 | Jun. 30, 2017 | |
Ownership percentage | 20.00% | |
Amount of initial funding to execute on license granted | $ 500,000 | |
Description of ownership percentage | The Company acquired a minority interest stake of 20% of WOD, with 100% ownership interest of WOD anticipated to be completed on or before October 15, 2016. | |
Ownership percentage owned by WODH | 80.00% | |
Shares exchanged under business aquisition | 800 | |
Description of joint venture under business acquisition | Under the terms of the Joint Venture, the initial ownership interest of WOD was 20% owned by the Company, with the remaining 80% owned WODH, with the option of Company to provide additional capital contributions to WOD in increments of not less than $10,000 up to a total of $8 million dollars in the aggregate, which included an equity exchange of up to a total of 800 units (80%) of WOD owned initially by WODH to the Company for a total of approximately 199,000 shares of Series B Preferred Stock and approximately 19,801,000 shares of Common Stock of the Company (the Shares) to be issued to WODH upon the completion of a final closing on or before December 31, 2018. | |
Reverse stock split | 1:1000 | |
Description of capital contributions under business acquisition | Until a minimum of at least $4 million in additional capital contributions have been made by the Company to WOD, resulting in a controlling ownership interest of not less than 60% of WOD by the Company, all the Shares of Company stock earmarked for the equity exchange with WODH is being held in a Voting Trust (as defined elsewhere in this filing), along with other key shareholder positions, in order to recapitalize the Company post a 1:1000 reverse split (which was previously approved), pending effectiveness after the Company becomes a current and fully-reporting public company. | |
Joint Venture Agreement [Member] | December 31, 2018 [Member] | ||
Series B Preferred Stock exchange | 199,000 | |
New shares | 19,801,000 | |
Minimum [Member] | ||
Capital contributions | $ 10,000 | |
Maximum [Member] | ||
Capital contributions | $ 8,000,000 |
BASIS OF PRESENTATION (Details
BASIS OF PRESENTATION (Details Narrative) - USD ($) | Jun. 30, 2017 | Dec. 31, 2016 |
Basis Of Presentation Details Narrative | ||
Deficit accumulated | $ (30,979,839) | $ (35,181,068) |
SUMMARY OF SIGNIFICANT ACCOUN24
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Details Narrative) | 3 Months Ended |
Jun. 30, 2017USD ($) | |
FDIC [Member] | |
Cash deposit accounts | $ 250,000 |
RELATED PARTY CONVERTIBLE PRO25
RELATED PARTY CONVERTIBLE PROMISSORY NOTE (Details Narrative) | Mar. 14, 2017USD ($)Machine | May 18, 2016USD ($)Machine$ / sharesshares | Jun. 30, 2017USD ($) | Jun. 30, 2016USD ($) | Jun. 30, 2015USD ($) |
Baker Myers [Member] | |||||
Accrued interest | $ 401,333 | $ 101,333 | |||
Interest rate | 10.00% | 12.00% | |||
Principal amount | $ 500,000 | $ 300,000 | 300,000 | ||
Debt discount | 48,072 | 48,072 | |||
Debt instrument periodic payment, per installment | $ 62,500 | ||||
Number of installments | Machine | 8 | ||||
Conversion price | Equal to the lesser of $0.01 per share or a discount of fifty-eight percent (58%) of the lowest trading price for the ten (10) prior trading days, subject to aggregate conversion limitations of 4.99% and other terms and conditions set forth therein | ||||
Cancelled Amount | $ 179,965 | ||||
Baker Myers [Member] | Elite Data Marketing LLC [Member] | |||||
Membership interest | 100.00% | ||||
Baker Myers [Member] | Series B Preferred Stock [Member] | |||||
Common stock purchase warrant | shares | 3,000,000 | ||||
Purchase price | $ / shares | $ 0.001 | ||||
Baker & Myers & Associates LLC [Member] | Note Cancellation and Extinguishment Agreement [Member] | |||||
Business acquisition, forgiven amount as consideration | $ 200,000 | ||||
Number of installments | Machine | 2 | ||||
Ownership percentage to be transferred under agreement | 100.00% | ||||
January 13, 2013 [Member] | Baker Myers [Member] | |||||
Accrued interest | $ 92,465 | ||||
Promissory note original amount | 587,500 | ||||
Principal amount | $ 87,500 | ||||
Myers Note [Member] | |||||
Accrued interest | $ 67,622 | ||||
Interest rate | 10.00% | ||||
Principal amount | $ 149,500 | ||||
Debt discount | $ 33,250 | ||||
Revolving Line of Credit Agreement [Member] | Sarah Myer [Member] | |||||
Accrued interest | $ 45,147 | $ 27,540 | |||
Interest rate | 10.00% | 12.00% | |||
Principal amount | $ 175,000 | $ 151,000 |
CONVERTIBLE PROMISSORY NOTE (De
CONVERTIBLE PROMISSORY NOTE (Details) - USD ($) | Jun. 30, 2017 | Dec. 31, 2016 |
Convertible notes payable | $ 500,000 | $ 2,500,000 |
Convertible notes current portion | ||
Convertible notes payable | 5,080,945 | |
Convertible notes long term portion | ||
Convertible notes payable | $ 500,000 |
CONVERTIBLE PROMISSORY NOTES (D
CONVERTIBLE PROMISSORY NOTES (Details Narrative) - USD ($) | Mar. 14, 2017 | Jan. 10, 2017 | Jul. 14, 2015 | Jun. 11, 2015 | May 24, 2016 | May 20, 2016 | May 18, 2016 | Jan. 28, 2016 | Dec. 31, 2015 | Dec. 16, 2015 | Jul. 23, 2015 | Jun. 16, 2015 | Jun. 30, 2017 | Jun. 30, 2016 | Dec. 31, 2016 | Aug. 26, 2016 | Dec. 11, 2015 | Aug. 16, 2013 |
Common stock share issue | 150,018,799 | 136,518,799 | ||||||||||||||||
Proceeds from issuance of convertible debt | $ 17,500 | |||||||||||||||||
Convertible notes payable | $ 500,000 | $ 2,500,000 | ||||||||||||||||
Risk-free interest rate | 84.00% | |||||||||||||||||
Expected dividend yield | 0.00% | |||||||||||||||||
Tarpon Bay Partners [Member] | Line of Credit [Member] | Promissory Note [Member] | ||||||||||||||||||
Convertible Note Balance | $ 50,000 | |||||||||||||||||
Convertible note due date | Jan. 31, 2016 | |||||||||||||||||
Debt conversion converted rate | 10.00% | |||||||||||||||||
Transaction costs | $ 50,000 | |||||||||||||||||
Termination Agreement to Definitive Agreement [Member] | ||||||||||||||||||
Accrued interest | 19,910 | |||||||||||||||||
Principal amount | $ 17,500 | |||||||||||||||||
Common stock conversion price | $ 0.01 | |||||||||||||||||
Termination Agreement, Description | The parties to that certain Definitive Agreement, dated May 20, 2016, incorporated by reference in Form 8K filed with the SEC on May 24, 2016, pursuant to which the Company agreed to acquire one hundred percent (100%)of the ownership interest in POM | |||||||||||||||||
Membership interest | 100.00% | |||||||||||||||||
Terms of conversion feature, Discription | Convertible into shares of the Company's common stock at a conversion price equal to the lesser of $0.01 per share or a discount of fifty-eight percent (58%) of the lowest trading price for the ten (10) prior trading days | |||||||||||||||||
Consecutive trading days | 10 days | |||||||||||||||||
Settlement Letter [Member] | Convertible Redeemable Note [Member] | ||||||||||||||||||
Convertible Note Balance | $ 20,000 | |||||||||||||||||
Convertible note due date | Jul. 31, 2016 | |||||||||||||||||
Debt conversion converted rate | 10.00% | |||||||||||||||||
Accrued interest | 31,633 | |||||||||||||||||
Principal amount | $ 27,500 | |||||||||||||||||
Common stock conversion price | $ 0.01 | |||||||||||||||||
Continued services | $ 7,500 | |||||||||||||||||
Terms of conversion feature, Discription | Convertible into shares of the Company's common stock at a conversion price equal to the lesser of $0.01 per share or a discount of fifty-eight percent (58%) of the lowest trading price for the ten (10) prior trading days | |||||||||||||||||
Consecutive trading days | 10 days | |||||||||||||||||
Termination Agreement [Member] | Tarpon Bay Partners [Member] | Line of Credit [Member] | ||||||||||||||||||
Convertible Note Balance | $ 50,000 | |||||||||||||||||
Convertible note due date | Jul. 14, 2015 | |||||||||||||||||
Debt conversion converted rate | 10.00% | |||||||||||||||||
Accrued interest | 9,610 | |||||||||||||||||
Outstanding balance | 50,000 | |||||||||||||||||
Proceeds from Issuance of Common Stock | $ 5,000,000 | |||||||||||||||||
Principal amount | $ 50,000 | |||||||||||||||||
Termination Agreement, Description | on July 14, 2015 (the "Effective Date"), to be due and payable to Tarpon by Company in four (4) separate equal quarterly payments of Twelve Thousand Five Hundred Dollars (USD $12,500), plus accrued interest to date, due on the first day of each quarter beginning on July 1, 2016, convertible into shares of the Company's common stock at a conversion price equal to fifty-eight percent (58%) of the lowest trading price for the ten (10) prior trading days, subject to aggregate conversion limitations of 9.99% | |||||||||||||||||
New Purchase Agreement [Member] | Tarpon Bay Partners [Member] | Line of Credit [Member] | ||||||||||||||||||
Proceeds from Issuance of Common Stock | $ 15,000,000 | |||||||||||||||||
Stephen Antol [Member] | Separation and Settlement Agreement [Member] | ||||||||||||||||||
Accrued interest | 1,900 | |||||||||||||||||
Outstanding balance | 40,000 | |||||||||||||||||
Terms of conversion feature, Discription | Common stock at a conversion price equal to the lesser of $0.01 per share or a discount of fifty-eight percent (58%) of the lowest trading price for the ten (10) prior trading days, and other terms and conditions set forth therein | |||||||||||||||||
Execution of the settlement agreement | Ten (10) prior trading days | |||||||||||||||||
Consecutive trading days | 10 days | |||||||||||||||||
Stephen Antol [Member] | Separation and Settlement Agreement [Member] | Series B Preferred Stock [Member] | ||||||||||||||||||
Principal amount | $ 40,000 | |||||||||||||||||
Common stock conversion price | $ 0.01 | |||||||||||||||||
Interest rate | 10.00% | |||||||||||||||||
Return shares in settlement shares | 500,000 | |||||||||||||||||
Return shares in settlement value | $ 2,500,000 | |||||||||||||||||
Dr. James G. Ricketts [Member] | Separation and Settlement Agreement [Member] | ||||||||||||||||||
Accrued interest | 1,900 | |||||||||||||||||
Outstanding balance | 40,000 | |||||||||||||||||
Terms of conversion feature, Discription | Common stock at a conversion price equal to the lesser of $0.01 per share or a discount of fifty-eight percent (58%) of the lowest trading price for the ten (10) prior trading days, and other terms and conditions set forth therein | |||||||||||||||||
Execution of the settlement agreement | Ten (10) prior trading days | |||||||||||||||||
Consecutive trading days | 10 days | |||||||||||||||||
Dr. James G. Ricketts [Member] | Separation and Settlement Agreement [Member] | Series B Preferred Stock [Member] | ||||||||||||||||||
Principal amount | $ 40,000 | |||||||||||||||||
Common stock conversion price | $ 0.01 | |||||||||||||||||
Interest rate | 10.00% | |||||||||||||||||
Return shares in settlement shares | 500,000 | |||||||||||||||||
Return shares in settlement value | $ 2,500,000 | |||||||||||||||||
Charles Rimlinger [Member] | Separation and Settlement Agreement [Member] | ||||||||||||||||||
Accrued interest | 1,900 | |||||||||||||||||
Outstanding balance | 40,000 | |||||||||||||||||
Principal amount | $ 40,000 | |||||||||||||||||
Common stock conversion price | $ 0.01 | |||||||||||||||||
Terms of conversion feature, Discription | Common stock at a conversion price equal to the lesser of $0.01 per share or a discount of fifty-eight percent (58%) of the lowest trading price for the ten (10) prior trading days, and other terms and conditions set forth therein | |||||||||||||||||
Interest rate | 10.00% | |||||||||||||||||
Execution of the settlement agreement | Ten (10) prior trading days | |||||||||||||||||
Consecutive trading days | 10 days | |||||||||||||||||
HYHI [Member] | Joint Venture Termination Agreement [Member] | ||||||||||||||||||
Accrued interest | 705,278 | |||||||||||||||||
Outstanding balance | 3,900,000 | |||||||||||||||||
Principal amount | $ 4,900,000 | |||||||||||||||||
Terms of conversion feature, Discription | equal to the lesser of $0.01 per share or fifty percent (50%) to the five (5) trading day average closing price immediately preceding the payment date, and (B) the remaining balance of Four Million (USD $4,000,000) payable in cash in a total of eight (8) equal quarterly installments of Five Hundred Thousand Dollars (USD $500,000), plus accrued interest to date, on the first day of each quarter beginning with January 1, 2017 and ending on January 1, 2019, convertible into shares of common stock of DEAC at fifty percent (50%) discount to the five (5) trading day average closing price immediately preceding the payment date, and other terms more fully described in the amended note set forth in the Amended and Restate Redeemable Note, thus cancelling the final two (2) quarterly payments (seventh and eighth quarterly payments) of Five Hundred Thousand Dollars (USD $500,000) each for a reduction of One Million Dollars (UD$1,000,000) of the principal amount of the Amended and Restated Redeemable Note | |||||||||||||||||
Quarterly payments | $ 3,900,000 | |||||||||||||||||
Principle reductions | 1,000,000 | |||||||||||||||||
HYHI [Member] | Joint Venture Termination Agreement [Member] | July 1, 2016 [Member] | ||||||||||||||||||
Separate payments | 450,000 | |||||||||||||||||
HYHI [Member] | Joint Venture Termination Agreement [Member] | October 1, 2016 [Member] | ||||||||||||||||||
Separate payments | $ 900,000 | |||||||||||||||||
H Y H I [Member] | Third Amendment [Member] | Securities Purchase Agreement and Joint Venture Agreement [Member] | ||||||||||||||||||
Principal amount | $ 10,000,000 | |||||||||||||||||
Initial amount and deposit | $ 100,000 | |||||||||||||||||
First Amendment to the Settlement Agreement [Member] | ||||||||||||||||||
Convertible debenture | $ 300,000 | |||||||||||||||||
First Amendment to the Settlement Agreement [Member] | Birch First Capital Fund LLC [Member] | ||||||||||||||||||
Common stock conversion price | $ 0.01 | |||||||||||||||||
Interest rate | 10.00% | |||||||||||||||||
Original amount | $ 300,000 | |||||||||||||||||
Convertible debenture | $ 400,000 | |||||||||||||||||
Consecutive trading days | 10 days | |||||||||||||||||
First Amendment to the Settlement Agreement [Member] | Birch First Capital Fund LLC [Member] | Warrant [Member] | ||||||||||||||||||
Common stock purchase warrant | 1,000,000 | |||||||||||||||||
Purchase price | $ 0.001 | |||||||||||||||||
First Amendment to the Settlement Agreement [Member] | Series B Preferred Stock [Member] | Birch First Capital Fund LLC [Member] | ||||||||||||||||||
Debt conversion converted rate | 4.99% | |||||||||||||||||
Common stock conversion price | $ 0.01 | |||||||||||||||||
Interest rate | 10.00% | |||||||||||||||||
Original amount | $ 300,000 | |||||||||||||||||
Convertible debenture | $ 10,000 | |||||||||||||||||
Common stock purchase warrant | 4,000,000 | |||||||||||||||||
Purchase price | $ 0.001 | |||||||||||||||||
Execution of the settlement agreement | period of twenty-four (24) months | |||||||||||||||||
Consecutive trading days | 10 days | |||||||||||||||||
Birch Advisor LLC [Member] | ||||||||||||||||||
Debt conversion converted rate | 2.00% | |||||||||||||||||
Accrued interest | 56,702 | |||||||||||||||||
Outstanding balance | $ 37,500 | |||||||||||||||||
Principal amount | 300,000 | |||||||||||||||||
Note discount balance | $ 72,267 | |||||||||||||||||
Terms of conversion feature, Discription | the three (3) lowest intraday trading average for the twenty (20) day trading period prior to each conversion date | |||||||||||||||||
Derivative liability | $ 12,000 | |||||||||||||||||
Fair value market price | $ 84,267 | |||||||||||||||||
Risk-free interest rate | 0.711% | |||||||||||||||||
Expected life | 1 year 8 months 9 days | |||||||||||||||||
Expected stock price volatility | 170.599% | |||||||||||||||||
Expected dividend yield | 0.00% | |||||||||||||||||
Convertible debenture | $ 300,000 | |||||||||||||||||
Purchase price | $ 0.10 | |||||||||||||||||
Execution of the settlement agreement | period of twenty-four (24) months | |||||||||||||||||
Consecutive trading days | 20 days | |||||||||||||||||
Birch First Capital Fund LLC [Member] | ||||||||||||||||||
Line of Credit Agreement | $ 151,000 | |||||||||||||||||
Birch First Capital Fund LLC [Member] | Amended and Restated [Member] | ||||||||||||||||||
Convertible Note Balance | $ 300,000 | |||||||||||||||||
Outstanding balance | 225,000 | 400,000 | ||||||||||||||||
Proceeds from Issuance of Common Stock | $ 37,500 | |||||||||||||||||
Common stock share issue | 750,000 | |||||||||||||||||
Principal amount | $ 75,000 | |||||||||||||||||
Common stock conversion price | $ 0.10 | |||||||||||||||||
Convertible notes payable | $ 472,028 | |||||||||||||||||
Note discount balance | $ 225,000 | |||||||||||||||||
Terms of conversion feature, Discription | Common Stock at a share price equal to the lesser of $0.10 per share, or fifty percent (50%) of the three (3) lowest intraday trading average for the twenty (20) day trading period prior to each conversion date | |||||||||||||||||
Interest rate | 2.00% | |||||||||||||||||
Derivative liability | $ 247,028 | |||||||||||||||||
Debt discount | 75,287 | |||||||||||||||||
Non cash settlement expense fee | 85,842 | |||||||||||||||||
Fair value market price | $ 472,028 | |||||||||||||||||
Risk-free interest rate | 0.711% | |||||||||||||||||
Expected life | 2 years | |||||||||||||||||
Expected stock price volatility | 175.371% | |||||||||||||||||
Expected dividend yield | 0.00% | |||||||||||||||||
EMA Financial, LLC [Member] | ||||||||||||||||||
Convertible Note Balance | 16,391 | |||||||||||||||||
Convertible note due date | Jul. 14, 2016 | |||||||||||||||||
Accrued interest | 34,940 | |||||||||||||||||
Common stock share issue | 100,000 | |||||||||||||||||
Principal amount | $ 156,500 | $ 140,109 | ||||||||||||||||
Proceeds from issuance of convertible debt | 135,000 | |||||||||||||||||
Legal fees | $ 21,500 | |||||||||||||||||
Terms of conversion feature, Discription | The Note is convertible by EMA into shares of our common stock at any time on the date which is six (6) months following the Issue Date ("Prepayment Termination Date"). At any time before the Prepayment Termination Date, the Company shall have the right, exercisable on not less than five (5) Trading Days prior written notice to EMA of this Note, to prepay the outstanding balance on this Note (principal and accrued interest), in full. The conversion price is the lower of: i) the closing sale price of the Common Stock on the Principal Market on the Trading Day immediately preceding the closing date, and (ii) 60% of the lowest sale price for the Common Stock on the Principal Market during the 20 consecutive Trading Days immediately preceding the Conversion Date. | |||||||||||||||||
Interest rate | 12.00% | |||||||||||||||||
Convertable note purchase price | $ 156,500 | |||||||||||||||||
Ownership exceeding to common stock percentage | 4.90% | |||||||||||||||||
Event of default, interest rate | 24.00% | |||||||||||||||||
Debt discount, Percentage | 70.00% | |||||||||||||||||
Adar Bays, LLC [Member] | ||||||||||||||||||
Accrued interest | $ 2,427 | |||||||||||||||||
Outstanding balance | 14,787 | |||||||||||||||||
Convertible note | 37,713 | |||||||||||||||||
Debt discount | 0 | |||||||||||||||||
Adar Bays, LLC [Member] | After Conversion [Member] | ||||||||||||||||||
Accrued interest | 3,342 | |||||||||||||||||
Principal amount | 14,787 | |||||||||||||||||
Adar Bays, LLC [Member] | 6% Convertible Note [Member] | ||||||||||||||||||
Convertible note due date | Jun. 16, 2016 | |||||||||||||||||
Debt conversion converted rate | 58.00% | |||||||||||||||||
Principal amount | $ 52,500 | |||||||||||||||||
Proceeds from issuance of convertible debt | $ 45,000 | |||||||||||||||||
Terms of conversion feature, Discription | The conversion features of the note are at price equal to 58% of the lowest closing bid price of our common stock for the ten trading days on or prior to the date upon which notice of conversion is received | |||||||||||||||||
Interest rate | 6.00% | |||||||||||||||||
Derivative liability | $ 73,459 | |||||||||||||||||
Debt discount | 48,412 | |||||||||||||||||
Derivative expense | $ 25,047 | |||||||||||||||||
LG Capital Funding, LLC [Member] | 6% Convertible Note [Member] | ||||||||||||||||||
Convertible note due date | Jun. 16, 2016 | |||||||||||||||||
Accrued interest | 2,669 | |||||||||||||||||
Outstanding balance | 42,239 | |||||||||||||||||
Principal amount | $ 52,500 | |||||||||||||||||
Proceeds from issuance of convertible debt | $ 45,000 | |||||||||||||||||
Terms of conversion feature, Discription | The conversion features of the note are at price equal to 58% of the lowest closing bid price of our common stock for the ten trading days on or prior to the date upon which notice of conversion is received | |||||||||||||||||
Interest rate | 6.00% | |||||||||||||||||
Derivative liability | $ 73,459 | |||||||||||||||||
Debt conversion converted amount, principal | 10,261 | |||||||||||||||||
Debt conversion converted amount, accrued interest | 281 | |||||||||||||||||
Debt discount | 48,412 | 0 | ||||||||||||||||
Derivative expense | $ 25,047 | |||||||||||||||||
LG Capital Funding, LLC [Member] | 6% Convertible Note [Member] | After Conversion [Member] | ||||||||||||||||||
Accrued interest | 5,251 | |||||||||||||||||
Principal amount | 42,239 | |||||||||||||||||
JSJ Investments Inc [Member] | 12% Convertible Note [Member] | ||||||||||||||||||
Accrued interest | $ 6,625 | 11,912 | ||||||||||||||||
Outstanding balance | 85,583 | 79,310 | ||||||||||||||||
Principal amount | $ 100,000 | |||||||||||||||||
Description of event of default | JSJ could enforce the Company to redeem all or any portion of the Note so demanded (including all accrued and unpaid interest), in cash, at a price equal to 150% of the outstanding balance, plus accrued Interest and Default Interest and any other amounts then due under this Note | |||||||||||||||||
Interest rate | 12.00% | |||||||||||||||||
Derivative liability | $ 91,388 | |||||||||||||||||
Debt conversion converted amount, principal | $ 14,417 | 20,690 | ||||||||||||||||
Loan discount balance | 0 | |||||||||||||||||
JSJ Investments Inc [Member] | 12% Convertible Note [Member] | After Conversion [Member] | ||||||||||||||||||
Accrued interest | 21,425 | |||||||||||||||||
Outstanding balance | 79,310 | |||||||||||||||||
JSJ Investments Inc [Member] | 12% Convertible Note [Member] | ||||||||||||||||||
Convertible note due date | Dec. 11, 2015 | |||||||||||||||||
Proceeds from issuance of convertible debt | $ 88,000 | |||||||||||||||||
Terms of conversion feature, Discription | JSJ is entitled to convert all the outstanding and unpaid principal amount of the Note into Common Stock at a 45% discount to the lowest trading price during the previous twenty (20) trading days to the date of the conversion notice | |||||||||||||||||
WOD Markets LLC [Member] | WOD [Member] | ||||||||||||||||||
Accrued interest | 3,395 | |||||||||||||||||
Outstanding balance | $ 40,000 | |||||||||||||||||
Principal amount | $ 40,000 |
DERIVATIVE INSTRUMENT LIABILI28
DERIVATIVE INSTRUMENT LIABILITIES (Details Narrative) - USD ($) | 6 Months Ended | ||
Jun. 30, 2017 | Jun. 30, 2016 | Dec. 31, 2016 | |
Derivative liabilities | $ 6,130,405 | $ 5,721,145 | |
Risk free interest rate | 84.00% | ||
Dividend yield | 0.00% | ||
Increase in derivative instruments liability | $ (264,504) | $ 1,124,993 | |
Minimum [Member] | |||
Remaining contractual life | 4 days | ||
Expected stock price volatility | 409.00% | ||
Maximum [Member] | |||
Remaining contractual life | 6 months 14 days | ||
Expected stock price volatility | 627.00% |
FAIR VALUE MEASUREMENT (Details
FAIR VALUE MEASUREMENT (Details) - USD ($) | Jun. 30, 2017 | Dec. 31, 2016 |
Derivative liabilities | $ 6,130,405 | $ 5,721,145 |
Level 1 | ||
Derivative liabilities | ||
Level 2 | ||
Derivative liabilities | ||
Level 3 | ||
Derivative liabilities | $ 6,130,405 | $ 5,721,145 |
FAIR VALUE MEASUREMENT (Detai30
FAIR VALUE MEASUREMENT (Details Narrative) - USD ($) | Jun. 30, 2017 | Dec. 31, 2016 |
Fair Value Measurement Details Narrative | ||
Derivative liabilities | $ 6,130,405 | $ 5,721,145 |
EQUITY INCENTIVE PLAN (Details
EQUITY INCENTIVE PLAN (Details Narrative) - Equity Incentive Plan [Member] | Oct. 15, 2015shares |
Exercise price of stock awards description | NQSOs shall not be less than 85% of the fair market value of the stock subject to the Option on the date of grant, and not less than 65% of the fair market value of the stock subject to the Stock Award on the date of grant |
Ten Percent Stockholder [Member] | |
Exercise price of stock awards description | Shall in no event be less than 110% of the fair market value of the stock covered by the Stock Award or Option at the time the Stock Award or Option is granted |
Maximum [Member] | |
Common stock, shares subscribed but unissued | 25,000,000 |
STOCKHOLDERS_ DEFICIT (Details)
STOCKHOLDERS’ DEFICIT (Details) - Warrants Issued for Services [Member] | 6 Months Ended |
Jun. 30, 2017shares | |
Number of warrants shares, Beginning | |
Granted warrants | |
Exercised warrants | |
Expired/Cancelled warrants | |
Number of warrants shares, Ending | |
Weighted Average Exercise Price warrants, Beginning | |
Weighted Average Exercise Price warrants, Granted | |
Weighted Average Exercise Price warrants, Exercised | |
Weighted Average Exercise Price warrants, Expired/Cancelled | (259) |
Weighted Average Exercise Price warrants, Ending |
STOCKHOLDERS_ DEFICIT (Details
STOCKHOLDERS’ DEFICIT (Details 1) - Warrants Issued In Settlements [Member] | 6 Months Ended |
Jun. 30, 2017shares | |
Number of warrants shares, Beginning | 7,000,000 |
Granted Preferred Warrants | |
Granted Common Warrants | |
Expired/Cancelled warrants | |
Number of warrants shares, Ending | 7,000,000 |
Weighted Average Exercise Price warrants, Beginning | 700 |
Weighted Average Exercise Price warrants, Granted Preferred | |
Weighted Average Exercise Price warrants, Granted Common | |
Weighted Average Exercise Price warrants, Expired/Cancelled | |
Weighted Average Exercise Price warrants, Ending | 700 |
STOCKHOLDERS_ DEFICIT (Detail34
STOCKHOLDERS’ DEFICIT (Details Narrative) - USD ($) | 1 Months Ended | 6 Months Ended | |||||
May 17, 2016 | Jun. 30, 2017 | Mar. 14, 2017 | Jan. 10, 2017 | Dec. 31, 2016 | May 18, 2016 | Oct. 15, 2015 | |
Preferred stock, par value | $ 0.0001 | ||||||
Preferred stock, authorized | 250,000,000 | ||||||
Common stock, par value | $ 0.0001 | $ 0.0001 | |||||
Common stock, Authorized | 500,000,000 | 500,000,000 | |||||
Common stock share issue | 150,018,799 | 136,518,799 | |||||
Common stock, outstanding | 150,018,799 | 136,518,799 | |||||
Issuance of common stock for conversion of debt, shares | 114,015,033 | ||||||
Issuance of common stock for conversion of debt, Amount | $ 661,854 | ||||||
Accrued interest | $ 281 | ||||||
Series B Preferred Stock [Member] | |||||||
Preferred stock, par value | $ 0.0001 | $ 0.0001 | |||||
Preferred stock, authorized | 250,000,000 | 250,000,000 | |||||
Preferred stock, issued | 0 | 0 | |||||
Preferred stock, outstanding | 0 | 0 | |||||
Birch First Warrant Transfer - Voting Trust [Member] | Series B Preferred Stock [Member] | |||||||
Voting rights | 1,100,000,000 | ||||||
Voting Trust - Change of Control [Member] | Series B Preferred Stock [Member] | |||||||
Preferred stock, outstanding | 1,100,000 | ||||||
Ricketts and Antol Stock [Member] | Series B Preferred Stock [Member] | |||||||
Return shares in settlement shares | 500,000 | ||||||
Return shares in settlement value | $ 5,000,000 | ||||||
Series B Preferred Stock [Member] | |||||||
Preferred stock, par value | $ 0.0001 | ||||||
Preferred stock, authorized | 100,000,000 | ||||||
Preferred stock, issued | 2,000,000 | ||||||
Preferred stock designated shares | 100,000,000 | ||||||
Reverse stock split | 1:1000 | ||||||
Series B Preferred Stock [Member] | Ricketts [Member] | |||||||
Preferred stock, issued | 1,000,000 | ||||||
Series B Preferred Stock [Member] | Antol [Member] | |||||||
Preferred stock, issued | 1,000,000 | ||||||
Minimum [Member] | |||||||
Preferred stock, par value | $ 0.0001 | ||||||
Increased share of preferred stock | 10,000,000 | ||||||
Common stock, par value | $ 0.0001 | ||||||
Common stock share issue | 60,000,000 | ||||||
Increased share of common stock | 50,000,000 | ||||||
Maximum [Member] | |||||||
Preferred stock, par value | $ 0.0001 | ||||||
Increased share of preferred stock | 250,000,000 | ||||||
Common stock, par value | $ 0.0001 | ||||||
Common stock share issue | 750,000,000 | ||||||
Increased share of common stock | 500,000,000 |
Joint Venture (Details)
Joint Venture (Details) - USD ($) | Jun. 30, 2017 | Dec. 31, 2016 | Jun. 30, 2016 | Dec. 31, 2015 |
ASSETS | ||||
Cash | $ 540 | $ 1,730 | ||
Total Current Assets | 540 | |||
Total Assets | 17,261 | 20,540 | ||
LIABILITIES | ||||
Accounts payable | 1,346,804 | 958,784 | ||
Total Liabilities | 12,915,603 | 12,328,962 | ||
EQUITY | ||||
Retained earnings | (30,979,839) | (35,181,068) | ||
Total Liabilities and Equity | 17,261 | $ 20,540 | ||
WOD Markets LLC [Member] | ||||
ASSETS | ||||
Cash | 3,141 | |||
Note receivable | 30,000 | |||
Inventory | 18,801 | |||
Total Current Assets | 51,942 | |||
Fixed Assets, net | 43,953 | |||
Total Assets | 95,895 | |||
LIABILITIES | ||||
Accounts payable | 47,685 | |||
Notes payable | 35,593 | |||
Total Liabilities | 83,278 | |||
EQUITY | ||||
Membership | 19,600 | |||
Retained earnings | (6,983) | |||
Total Membership | 12,617 | |||
Total Liabilities and Equity | $ 95,895 |
Joint Venture (Details1)
Joint Venture (Details1) - USD ($) | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2017 | Jun. 30, 2016 | Jun. 30, 2017 | Jun. 30, 2016 | |
EXPENSES | ||||
Interest | $ 11,237 | $ 51,255 | $ 26,531 | $ 67,115 |
NET LOSS | 2,404,612 | $ (5,085,759) | 4,203,969 | $ (5,733,153) |
WOD Markets LLC [Member] | ||||
SALES | 21,962 | 43,427 | ||
COST OF GOODS | 12,731 | 26,448 | ||
GROSS PROFIT | 9,231 | 16,978 | ||
EXPENSES | ||||
Interest | 3,193 | 4,603 | ||
Depreciation | 1,614 | 3,228 | ||
Rent | 7,420 | 14,094 | ||
General and Administrative | 4,380 | 8,751 | ||
Total Expense | 16,607 | 30,676 | ||
NET LOSS | $ (7,376) | $ (13,698) |
Joint Venture (Details Narrativ
Joint Venture (Details Narrative) | Mar. 14, 2017USD ($)Machineshares | Jun. 30, 2017 | Aug. 26, 2016 |
WOD [Member] | |||
Ownership interest | 20.00% | ||
Reverse stock split | 1:1000 | ||
Brenton Mix [Member] | Contractor Agreements [Member] | Transaction One [Member] | |||
Monthly compensation | $ 10,000 | ||
Brenton Mix [Member] | Contractor Agreements [Member] | Transaction Two [Member] | |||
Monthly compensation | 12,500 | ||
Brenton Mix [Member] | Contractor Agreements [Member] | Transaction Three [Member] | |||
Monthly compensation | 15,000 | ||
Brenton Mix [Member] | Contractor Agreements [Member] | Transaction Four [Member] | |||
Monthly compensation | 20,000 | ||
Richard Phillips [Member] | Contractor Agreements [Member] | Transaction One [Member] | |||
Monthly compensation | 1,250 | ||
Richard Phillips [Member] | Contractor Agreements [Member] | Transaction Two [Member] | |||
Monthly compensation | 2,500 | ||
Richard Phillips [Member] | Contractor Agreements [Member] | Transaction Three [Member] | |||
Monthly compensation | $ 5,000 | ||
Joint Venture Agreement [Member | WOD [Member] | |||
Ownership interest | 20.00% | ||
Series B Preferred Stock exchange | shares | 199,000 | ||
Additional capital contributions | $ 4,000,000 | ||
Equity exchange units | Machine | 800 | ||
Joint Venture Agreement [Member | WOD [Member] | Minimum [Member] | |||
Additional capital contributions | $ 10,000 | ||
Joint Venture Agreement [Member | WOD [Member] | Maximum [Member] | |||
Additional capital contributions | $ 8,000,000 | ||
Joint Venture Agreement [Member | WODH [Member] | |||
Ownership interest | 80.00% | ||
New shares | shares | 18,801,000 | ||
Reverse stock split | 1:1000 |
SUBSEQUENT EVENTS (Details Narr
SUBSEQUENT EVENTS (Details Narrative) - USD ($) | Aug. 04, 2017 | Aug. 29, 2017 | Jun. 30, 2017 | Dec. 14, 2017 | Dec. 13, 2017 | Dec. 01, 2017 | Nov. 17, 2017 | Oct. 26, 2017 | Dec. 31, 2016 | Aug. 26, 2016 |
Common stock, par value | $ 0.0001 | $ 0.0001 | ||||||||
Preferred stock, Par value | $ 0.0001 | |||||||||
Subsequent Event [Member] | ||||||||||
Shares issued | 8,050,000 | 24,350,921 | 8,175,000 | 7,491,667 | 7,363,900 | |||||
Convertable debt amount | $ 403 | $ 1,483 | $ 409 | $ 1,124 | $ 736 | |||||
Subsequent Event [Member] | Preferred Class B [Member] | ||||||||||
Ownership interest | 100.00% | |||||||||
Stock split | 1000:1 | |||||||||
Voting rights | 88.00% of total voting rights | |||||||||
WOD [Member] | ||||||||||
Ownership interest | 20.00% | |||||||||
Reverse stock split | 1:1000 | |||||||||
WOD [Member] | Subsequent Event [Member] | ||||||||||
Reverse stock split | 1:10,000 | |||||||||
Amended to capital stock authorized increase | 10,500,000,000 | |||||||||
Amended Common stock, Authorized increase | 10,000,000,000 | |||||||||
Common stock, par value | $ 0.0001 | |||||||||
Preferred stock, Par value | $ 0.0001 | |||||||||
Amended Preferred stock, Authorized increase | 500,000,000 | |||||||||
WOD [Member] | Subsequent Event [Member] | Preferred Class B [Member] | ||||||||||
Stock split | 1000:1 | |||||||||
Voting rights | 88.00% of total voting rights |