Document and Entity Information |
9 Months Ended | |
|---|---|---|
Sep. 30, 2013 |
Nov. 18, 2013 |
|
| Document And Entity Information | ||
Entity Registrant Name |
5Barz International, Inc. | |
Entity Central Index Key |
0001454124 | |
Document Type |
10-Q | |
Document Period End Date |
Sep. 30, 2013 | |
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 |
160,038,990 | |
Document Fiscal Period Focus |
Q3 | |
Document Fiscal Year Focus |
2013 |
Condensed Consolidated Balance Sheets (USD $) |
Sep. 30, 2013 |
Dec. 31, 2012 |
|---|---|---|
| CURRENT ASSETS: | ||
Cash |
$ 143,754 | $ 48,308 |
Prepaid expenses and deposits |
61,075 | 22,156 |
TOTAL CURRENT ASSETS |
204,829 | 70,464 |
Equipment, net |
7,015 | 4,406 |
| OTHER ASSETS: | ||
Intangible assets |
3,387,406 | 3,387,406 |
Goodwill |
1,140,246 | 1,140,246 |
Total other assets |
4,527,652 | 4,527,652 |
TOTAL ASSETS |
4,739,496 | 4,602,522 |
| CURRENT LIABILITIES: | ||
Accounts payable and accrued expenses |
2,562,262 | 2,445,410 |
Due to escrow agent |
52,321 | 52,321 |
Accrued derivative liabilities |
60,772 | |
Notes payable (net of discount) |
1,089,882 | 993,554 |
TOTAL CURRENT LIABILITIES |
3,765,237 | 3,491,285 |
Related party loans |
472 | 19,850 |
TOTAL LIABILITIES |
3,765,709 | 3,511,135 |
| STOCKHOLDERS' EQUITY | ||
Common stock, $.001 par value, 250,000,000 shares authorized; 138,403,772 and 117,418,281 shares issued and outstanding as of September 30, 2013 and December 31, 2012, respectively |
138,404 | 117,418 |
Capital in excess of par value |
5,179,130 | 3,226,802 |
Deficit accumulated during the development stage |
(4,989,290) | (2,971,099) |
Accumulated other comprehensive income |
27,250 | 4,272 |
Non-controlling interest |
618,293 | 713,994 |
Total stockholders' equity |
973,787 | 1,091,387 |
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY |
$ 4,739,496 | $ 4,602,522 |
Condensed Consolidated Balance Sheets (Parenthetical) (USD $) |
Sep. 30, 2013 |
Dec. 31, 2012 |
|---|---|---|
| Statement of Financial Position [Abstract] | ||
Common stock, par value |
$ 0.001 | $ 0.001 |
Common stock, authorized |
250,000,000 | 250,000,000 |
Common stock, issued |
138,403,772 | 117,418,281 |
Common stock,outstanding |
138,403,772 | 117,418,281 |
Condensed Consolidated Statements of Operations (USD $) |
3 Months Ended | 9 Months Ended | 59 Months Ended | ||
|---|---|---|---|---|---|
Sep. 30, 2013 |
Sep. 30, 2012 |
Sep. 30, 2013 |
Sep. 30, 2012 |
Sep. 30, 2013 |
|
| Income Statement [Abstract] | |||||
Sales |
|||||
Cost of Sales |
|||||
| Selling general and administrative expenses: | |||||
Amortization and depreciation |
495 | 831 | 1,623 | 2,689 | 6,196 |
Bank charges and interest |
15,889 | 2,957 | 44,857 | 140,881 | 280,720 |
Sales and marketing expenses |
36,514 | 7,871 | 127,882 | 94,635 | 472,295 |
Research & development |
201,958 | 305,958 | 0 | 305,958 | |
General and administrative expenses |
770,506 | 332,403 | 1,753,912 | 1,507,354 | 4,388,309 |
Total operating expenses |
1,025,362 | 344,062 | 2,234,231 | 1,745,559 | 5,453,477 |
(Loss) from operations |
(1,025,362) | (344,062) | (2,234,231) | (1,745,559) | (5,453,477) |
| Other income (expense): | |||||
Interest income |
(1,128) | 1,212 | 16,666 | ||
Currency gains (losses) |
(567) | ||||
Change in fair value of derivative liability |
(1,346) | (147,530) | (52,594) | (75,556) | 577,492 |
Amortization of debt discount on derivative liability |
(74,623) | (92,288) | (132,897) | ||
Loss on termination of finance agreements |
(152,676) | ||||
Other |
86,060 | 172,933 | (1,537) | 169,797 | |
Total Other income (expense) |
84,715 | (225,195) | 120,339 | (168,169) | 477,815 |
Net (loss) before non-controlling interest |
(940,647) | (569,258) | (2,113,892) | (1,915,642) | (4,975,662) |
Non-controlling interest share of net loss |
(4,577) | 139 | (95,701) | 446,013 | 13,628 |
Net loss after non-controlling interest |
(936,070) | (569,397) | (2,018,191) | (2,361,655) | (4,989,290) |
Basic (loss) per common share |
$ (0.0075) | $ (0.0052) | $ (0.0178) | $ (0.0188) | |
Weighted average number of shares outstanding |
125,414,735 | 108,607,401 | 118,545,298 | 102,081,180 | |
| Other comprehensive income | |||||
Foreign currency translation gain (loss) |
11,227 | (2,054) | 22,979 | (1,735) | |
Other comprehensive income |
11,227 | (2,054) | 22,979 | (1,735) | |
Comprehensive (loss) |
$ (924,843) | $ (571,451) | $ (1,995,212) | $ (2,363,390) | |
Condensed Consolidated Statements of Cash Flows (USD $) |
9 Months Ended | 59 Months Ended | |
|---|---|---|---|
Sep. 30, 2013 |
Sep. 30, 2012 |
Sep. 30, 2013 |
|
| CASH FLOWS FROM OPERATING ACTIVITIES: | |||
Net loss |
$ (2,113,892) | $ (1,915,642) | $ (4,975,662) |
| Adjustments to reconcile net loss to net cash used in operating activities: | |||
Depreciation and amortization |
1,623 | 2,689 | 5,612 |
Stock based compensation |
515,123 | 522,236 | |
Change in fair value of derivative liability |
60,772 | 240,478 | (480,678) |
Change in debt discount on convertible notes |
1,336,129 | 152,821 | |
Change in warrant liability |
5,120 | 14,968 | |
Common shares issued for services |
220,139 | 452,990 | 1,064,852 |
| Changes in operating assets and liabilities: | |||
Change in accounts payable and accrued expenses |
319,260 | 506,279 | 891,747 |
Change in prepaid expenses and deposits |
(38,920) | 3,053 | (41,700) |
Change in unpaid interest and penalties on notes payable |
(44,545) | 91,507 | 342,096 |
Change in amount due to escrow agent |
52,322 | ||
Net cash from (used in) operating activities |
(1,080,440) | (479,913) | (2,451,387) |
| CASH FLOWS FROM INVESTING ACTIVITIES: | |||
Deposit on investment in Cellynx |
(170,000) | ||
Cash in Cellynx - date of acquisition |
3,260 | ||
Acquisition of intangible assets |
(4,808) | ||
Purchase of furniture and equipment assets |
(3,103) | (7,756) | |
Net cash used in investing activities |
(3,103) | (179,304) | |
| CASH FLOWS FROM FINANCING ACTIVITIES: | |||
Payments under line of credit agreement Cellynx |
(83,156) | (250,152) | |
Payment of amount due to Cellynx - intellectual property acquisition |
(242,865) | ||
Proceeds from issuance of convertible notes |
35,000 | 258,500 | 442,139 |
Payments of amounts due to related party |
(19,378) | (97,612) | (463,701) |
Proceeds used to settle notes payable |
(151,584) | (95,942) | (219,901) |
Proceeds from issuance of common stock |
1,196,750 | 279,628 | 3,106,597 |
Proceeds from issuance of common stock by subsidiary - 5BARz AG |
95,222 | 221,615 | 375,078 |
Net cash provided by financing activities |
1,156,010 | 483,033 | 2,747,194 |
Effect of foreign currency exchange |
22,979 | (1,735) | 27,251 |
NET INCREASE IN CASH |
95,446 | 1,385 | 143,754 |
CASH, BEGINNING OF PERIOD |
48,308 | 49,209 | |
CASH, END OF PERIOD |
143,754 | 50,594 | 143,754 |
| Supplementary disclosure of cash flow information | |||
Cash paid for interest |
13,374 | 15,534 | 70,194 |
| NON-CASH INVESTING AND FINANCING ACTIVITIES | |||
Common stock issued upon acquisition of Cellynx Group, Inc. |
250,000 | 250,000 | |
Settlement of prepaid deposit upon acquisition of Cellynx Group, Inc. |
170,000 | 170,000 | |
Fair market value of notes converted upon acquisition of Cellynx Group, Inc. |
455,000 | 521,200 | |
Fair market value of net assets acquired |
875,000 | 875,000 | |
Conversion of notes payable - Cellynx Group,Inc |
7,200 | 81,000 | 76,200 |
Investment in Cellynx intellectual property for shares |
1,800,000 | 1,800,000 | |
Replacement of common shares acquired with a convertible note |
80,000 | 80,000 | |
Issuance of convertible note in lieu of accounts payable |
147,428 | 147,428 | |
Shares issued to settle interest on notes payable |
7,500 | 7,500 | |
Settlement of accounts payable with common stock |
$ 31,250 | $ 31,250 | |
Organization, Going Concern and Development Stage |
9 Months Ended |
|---|---|
Sep. 30, 2013 | |
| Notes to Financial Statements | |
Organization, Going Concern and Development Stage |
Note 1 Organization, Going Concern and Development Stage
The Company was incorporated under the laws of the State of Nevada on November 14, 2008. The Company was originally named Bio-Stuff and was a designated shell corporation from inception to the date of acquisition of the 5BARz assets.
On December 29, 2010 the Company changed its name to 5BARz International, Inc. and on December 30, 2010, the Company acquired from CelLynx Group, Inc. the rights to certain intellectual property underlying the 5BARz products, a highly engineered wireless technology referred to as a cellular network infrastructure device. The 5BARz device captures cell signal and provides a smart amplification and resend of that cell signal giving the user improved cellular reception in their home, office or while mobile. On March 29, 2012, 5BARz International, Inc. acquired a 60% controlling interest in CelLynx Group, Inc.
On November 6, 2011, the Company incorporated a subsidiary Company in Zurich, Switzerland called 5BARz AG which is a 94.4% held subsidiary at September 30, 2013. This entity has been granted the license for the marketing and distribution rights for 5BARz products in Germany, Austria and Switzerland.
These financial statements reflect the financial position for the Company and its subsidiary companies 5BARz AG, CelLynx Group Inc. and its wholly owned subsidiary CelLynx Inc. as at September 30, 2013. Results of operations include those operations for subsidiaries acquired from the date of acquisition.
Going concern
The accompanying consolidated financial statements have been prepared on a going concern basis, which contemplates the realization of assets and the satisfaction of liabilities in the normal course of business. The Company is a development stage company and has not commenced planned principal operations. As shown in the accompanying consolidated financial statements, the Company has incurred recurring losses for the period from November 14, 2008 (date of inception) through September 30, 2013 of $4,975,662. The Company has negative cash flows from operations since inception of $2,451,387 and has an accumulated deficit of $4,989,290 at September 30, 2013. The Company has made no revenue to date. The Company is seeking additional sources of equity or debt financing, and there is no assurance these activities will be successful. These factors raise substantial doubt about the Companys ability to continue as a going concern and the Companys continued existence is dependent upon adequate additional financing being raised to develop its sales and marketing program for the sales of 5BARz product and commence its planned operations.
The Company is in default on certain notes payable. Accordingly, any penalties and interest has been accrued as of September 30, 2013 (see Note 7).
The accompanying consolidated financial statements do not include any adjustments related to the recoverability or classification of asset-carrying amounts or the amounts and classification of liabilities that may result should the Company be unable to continue as a going concern.
Development stage
The Company is considered to be a development stage entity as defined by the Financial Accounting Standards Board (FASB) Accounting Standards Codification (ASC) Topic 915. The Company has been a development stage entity since November 14, 2008 its inception. The Company has not generated any revenues to date. |
Summary of significant accounting policies |
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Sep. 30, 2013 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Accounting Policies [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Summary of significant accounting policies |
Note 2 - Summary of significant accounting policies
Basis of presentation
The accompanying unaudited condensed consolidated financial statements have been prepared in accordance with generally accepted accounting principles for interim financial information and with the instructions to Form 10-Q and Article 10 of Regulation S-X. Accordingly, they do not include all of the information and footnotes required by accounting principles generally accepted in the United States of America for complete financial statements. In the opinion of management, all adjustments (consisting of normal recurring accruals) considered necessary for a fair presentation have been included. Operating results for the nine months ended September 30, 2013, are not necessarily indicative of the results that may be expected for the year ending December 31, 2013. For further information, refer to the consolidated financial statements and footnotes thereto included in the Company's Annual Report on Form 10-K filed on May 13, 2013 for the fiscal year ended December 31, 2012.
The accompanying consolidated financial statements include the accounts of 5BARz International Inc., and its 94.4% owned subsidiary, 5BARz AG, and its 60% owned subsidiary CelLynx Group, Inc. and that Companys 100% owned subsidiary CelLynx, Inc. All intercompany accounts and transactions have been eliminated in consolidation.
Use of estimates
The preparation of these financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosures of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Significant estimates include impairment analysis for long lived assets, income taxes, litigation and valuation of derivative instruments. Actual results could differ from those estimates.
Intangible assets
Acquired patented and unpatented technology, licensing rights and trademarks are capitalized at their fair value. The legal costs, patent registration fees, and models and drawings required for filing patent applications are capitalized if they relate to commercially viable technologies. Commercially viable technologies are those technologies that are projected to generate future positive cash flows in the near term. Legal costs associated with applications that are not determined to be commercially viable are expensed as incurred. All research and development costs incurred in developing the patentable idea are expensed as incurred. Legal fees from the costs incurred in successful defense to the extent of an evident increase in the value of the patents are capitalized.
Capitalized costs for patents are amortized on a straight-line basis over the remaining twenty-year legal life of each patent after the costs have been incurred. Once each patent or trademark is issued, capitalized costs are amortized on a straight-line basis over a period not to exceed 20 years and 10 years, respectively. All research and development costs incurred in developing the patentable idea are expensed as incurred. The licensing right is amortized on a straight-line basis over a period of 10 years. Based on its review, the Company concluded that as of September 30, 2013 and December 31, 2012 there was no impairment of its intangible assets.
Goodwill
Generally accepted accounting principles in the United States require the Company to perform a goodwill impairment test annually and more frequently when negative conditions or a triggering event arise. After an assessment of certain qualitative factors, if it is determined to be more likely than not that the fair value of a reporting unit is less than its carrying amount, entities must perform the quantitative analysis of the goodwill impairment test. Based on its review, the Company concluded that as of September 30, 2013 there was no impairment of its goodwill.
Foreign currency translation
Transactions in foreign currencies have been translated into US dollars using the temporal method. The functional currency of the Companys subsidiary 5BARz AG, is its local currency (Swiss Franc CHF). Under this method, monetary assets and liabilities are translated at the year-end exchange rate. Non-monetary assets have been translated at the historical rate of exchange prevailing at the date of the transaction. Expenses have been translated at the exchange rate at the time of the transaction. Realized and unrealized foreign exchange gains and losses are included in operations.
Fair value of financial instruments The carrying amounts of cash and cash equivalents, accounts receivable, accounts payable and accrued expenses and other current liabilities, approximate fair value due to the short-term nature of these instruments. Fair value is defined as an exit price, representing the amount that would be received upon the sale of an asset or payment to transfer a liability in an orderly transaction between market participants. Fair value is a market-based measurement that is determined based on assumptions that market participants would use in pricing an asset or liability. A three-tier fair value hierarchy is used to prioritize the inputs in measuring fair value as follows:
The assets or liabilitys fair value measurement within the fair value hierarchy is based upon the lowest level of any input that is significant to the fair value measurement. The following table provides a summary of the assets that are measured at fair value on a recurring basis.
The following table sets forth a summary of the changes in the fair value of the Companys Level 3 financial liabilities that are measured at fair value on a recurring basis:
The derivative conversion feature liabilities are measured at fair value using the Black-Scholes pricing model and are classified within Level 3 of the valuation hierarchy. The significant assumptions and valuation methods that the Company used to determine fair value and the change in fair value of the Companys derivative financial instruments are provided below:
Level 3 liabilities are valued using unobservable inputs to the valuation methodology that are significant to the measurement of the fair value of the derivate liabilities. For fair value measurements categorized within Level 3 of the fair value hierarchy, the Companys accounting and finance department, which reports to the Chief Financial Officer, determines its valuation policies and procedures. The development and determination of the unobservable inputs for Level 3 fair value measurements and fair value calculations are the responsibility of the Companys accounting and finance department with support from the Companys consultants and which are approved by the Chief Financial Officer.
Level 3 financial liabilities consist of the derivative liabilities for which there is no current market such that the determination of fair value requires significant judgment or estimation. Changes in fair value measurements categorized within Level 3 of the fair value hierarchy are analyzed each period based on changes in estimates or assumptions and recorded as appropriate.
The Company uses the Black-Scholes option valuation model to value Level 3 financial liabilities at inception and on subsequent valuation dates. This model incorporates transaction details such as the Companys stock price, contractual terms, maturity, risk free rates, as well as, volatility.
As of September 30, 2013 there were no transfers in or out of Level 3 from other levels in the fair value hierarchy.
Derivative instruments
The Company evaluates its convertible instruments, options, warrants or other contracts to determine if those contracts or components of those contracts qualify as derivatives to be separately accounted for under ASC Topic 815, Derivatives and Hedging. The result of this accounting treatment is that the fair value of the derivative is marked-to-market each balance sheet date and recorded as a liability. In the event that the fair value is recorded as a liability, the change in fair value is recorded in the statement of operations as other income (expense). Upon conversion or exercise of a derivative instrument, the instrument is marked to fair value at the conversion date and then that fair value is reclassified to equity. Equity instruments that are initially classified as equity that become subject to reclassification under ASC Topic 815 are reclassified to liability at the fair value of the instrument on the reclassification date.
Net loss per share
The Company reports loss per share in accordance with the ASC Topic 260, Earnings Per Share., which requires presentation of basic and diluted EPS on the face of the income statement for all entities with complex capital structures and requires a reconciliation of the numerator and denominator of the basic EPS computation to the numerator and denominator of the diluted EPS computation. In the accompanying financial statements, basic earnings per share of common stock is computed by dividing net income by the weighted average number of shares of common stock outstanding during the period plus the issuance of common shares, if dilutive, that could result from the exercise of outstanding stock options and warrants. These potentially dilutive securities were not included in the calculation of loss per common share for the three and nine months ended September 30, 2013 or 2012 because their effect would be anti-dilutive. The weighted average number of shares outstanding does not include reciprocal shareholdings, held by the Companys subsidiary, CelLynx Group, Inc. which is reflected as a reduction in capital in excess of par value on the Companys balance sheet.
Stock Based Compensation The Company reports stock-based compensation under ASC 718 Compensation Stock Compensation. ASC 718 requires all share-based payments to employees, including grants of employee stock options, warrants to be recognized in the consolidated financial statements based on their fair values. The Company accounts for equity instruments issued to non-employees as compensation in accordance with the provisions of ASC 718, which require that each such equity instrument be recorded at its fair value on the measurement date, which is typically the date the services are performed. The Black-Scholes option valuation model is used to estimate the fair value of the warrants or options granted. The model includes subjective input assumptions that can materially affect the fair value estimates. The model was developed for use in estimating the fair value of traded options or warrants. The expected volatility is estimated based on the most recent historical period of time equal to the weighted average life of the warrants or options granted
Reclassifications
Certain reclassifications have been made in the financial statements at September 30, 2012 and for the three and nine months then ended to conform to the September 30, 2013 presentation. The reclassifications had no effect on net loss.
Recent accounting pronouncements
FASB, the Emerging Issues Task Force and the SEC have issued certain other accounting standards, updates, and regulations as of September 30, 2013 that will become effective in subsequent periods; however, management does not believe that any of those updates would have significantly affected our financial accounting measures or disclosures had they been in effect during 2013 or 2012, and it does not believe that any of those pronouncements will have a significant impact on our consolidated financial statements at the time they become effective.
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Acquisition of CelLynx Group, Inc. |
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| Notes to Financial Statements | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Acquisition of CelLynx Group, Inc. |
Note 3 Acquisition of CelLynx Group, Inc.
On January 7, 2011 the Company entered into a stock purchase agreement with two founding shareholders of CelLynx Group, Inc. to acquire in aggregate 63,412,638 shares of the capital stock of CelLynx Group, Inc. for total proceeds of $634,126. At that date the Company had paid $170,000 as a deposit made under that agreement. On March 29, 2012 the Company entered into a securities exchange agreement and settlement agreement with each of the two founding shareholders of CelLynx Group, Inc. whereby in addition to the $170,000 paid, the Company issued 1,250,000 shares of its common stock in exchange for the 63,412,638 shares of CelLynx Group, Inc. and mutual releases were signed between the parties releasing each from any further obligation.
On March 29, 2012, the Company acquired a further interest in CelLynx Group, Inc. by conversion of $73,500 of convertible debt in CelLynx Group, Inc for the issuance of 350,000,000 shares in the capital stock of CelLynx Group, Inc. As a result, in combination with the shares acquired from existing shareholders referred to above, the registrant acquired a 60% controlling interest in CelLynx Group, Inc. and has accounted for that acquisition as a consolidated subsidiary of the registrant effective March 29, 2012.
The purchase price, which was settled in cash, shares, and the settlement of convertible debt was $875,000, as follows:
The amounts recognized for each class of the acquirees assets and liabilities recognized at the acquisition date, March 29, 2012 are as follows;
On April 13, 2012 the Company exercised $7,700 under the terms of the convertible line of credit agreement with CelLynx Group, Inc. to acquire a further 51,333,333 shares in the capital stock of CelLynx Group, Inc. On May 15, 2012 the Company exercised a further $58,500 to acquire a further 390,000,000 shares and on May 21, 2013 the Company acquired 375,000,000 shares on the conversion of $9,375 under the convertible line of credit agreement. Each conversion increased the percentage ownership that the Company holds in CelLynx Group, Inc. to a 60% interest, subsequent to dilution arising from 3rd party convertible note conversions. At September 30, 2013 the Company had a 60% equity ownership in CelLynx Group, Inc. |
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Investment in 5BARz AG |
9 Months Ended |
|---|---|
Sep. 30, 2013 | |
| Notes to Financial Statements | |
Investment in 5BARz AG |
Note 4 Investment in 5BARz AG
On October 6, 2011, the Company incorporated a subsidiary Company under the laws of Switzerland, in the Canton of Zurich, called 5BARz AG. 5BARz AG issued 10,000,000 common shares of which 5,100,000 are held by the Company, 450,000 are held by officers and a consultant to the Company and 4,450,000 were held in escrow for resale, by an independent escrow agent under the control of the Company. 5BARz AG issued the shares with a stated or par value of CHF 0.01 per share for proceeds of CHF 100,000 (US - $108,752). The net proceeds received on re-sale above the stated or par value of the shares, is paid into 5BARz AG as additional paid in capital. During the period from inception (October 6, 2011) to September 30, 2013, sales of those securities aggregated 122,000 shares sold for proceeds of $366,000 CHF ($372,728 USD). At September 30, 2012 the Company holds a 94.3% controlling interest in 5BARz AG represented by 9,428,000 shares. During the 9 month period ended September 30, 2013 the Company sold 30,000 of the securities that it holds in 5BARz AG and the controlling interest in 5BARz AG was reduced by 0.3% to a 94.3% controlling interest.
On October 19, 2011, the registrant, 5BARz International Inc. entered into a Marketing and Distribution agreement with 5BARz AG, through which 5BARz AG holds the exclusive rights for the marketing and distribution of products produced under the 5BARz brand for markets in Switzerland, Austria and Germany. That agreement does not have a royalty payment requirement, and remains effective as long as 5BARz AG is controlled by the Company. 5BARz AG is a consolidated subsidiary of the Company in these financial statements. |
Intangible assets and goodwill |
9 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Intangible assets and goodwill |
Note 5 Intangible assets and goodwill
Intangible assets are comprised of patented and unpatented technology, trademarks and license rights which are recorded at cost, comprised of legal fees and acquisition costs. Once each patent or trademark is issued, capitalized costs are amortized on a straight-line basis over a period not to exceed 20 years and 10 years, respectively. License rights are amortized over the period of the respective license agreement.
During the nine months ended September 30, 2013 and year ended December 31, 2012 no amortization has been recorded on technology and other intangibles. The intangible assets acquired on December 29, 2011 related to the 5BARz technology will commence amortization with the initial commercial production (commercial viability) of products incorporating the related technology. The Companys estimated patented and unpatented technology amortization over the next five years is expected to be $886,998.
Marketing and distribution agreement will commence amortization with the initial commercial production of products. Trademark and license amortization is calculated straight line over a 10 year period. The Companys estimated amortization on trademarks and licenses over the next five years is expected to be $806 and $806 for the remaining life of those assets.
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Common Stock |
9 Months Ended |
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Sep. 30, 2013 | |
| Notes to Financial Statements | |
Common Stock |
Note 6 Common Stock Since its inception, the Company has issued shares of common stock as follows: On November 14, 2008, the Companies Directors authorized the issuance of 7,100,000 founder shares at par value of $0.001. These shares are restricted under rule 144 of the Securities Exchange Commission. On various days in December 2008, our Directors authorized the issuance of 1,776,100 shares of common stock at a price of $0.01 per share as fully paid and non-assessable to the subscriber. These shares are not restricted and are free trading. On November 15, 2010, our Directors initiated a forward stock split of 18:1 and increased the authorized shares from 100,000,000 to 250,000,000 On December 30, 2010, the Directors approved the cancellation of 87,800,000 shares of common stock. On December 31, 2010, the Directors issued 15,600,000 shares in conjunction with the acquisition of certain assets, more fully described in Note 9.
On January 10, 2011 the Company issued 300,000 shares of common stock at a price of $1.00 per share for aggregate proceeds of $300,000.
On January 15, 2011 the Company issued 200,000 shares of common stock at a price of $1.00 per share for aggregate proceeds of $200,000.
On March 9, 2011 the Company issued 150,000 shares of common stock at a price of $1.00 per share for aggregate proceeds of $150,000.
On April 4, 2011 the Company issued 350,000 shares of common stock at a price of $1.00 per share for aggregate proceeds of $350,000.
On April 7, 2011 the Company issued 200,000 shares of common stock at a price of $1.00 per share for aggregate proceeds of $200,000.
On June 3, 2011 the Company issued 5,000 shares of common stock at a price of $0.70 per share for aggregate proceeds of $3,500.
On July 18, 2011 the Company issued 25,000 shares of common stock at a price of $1.00 per share for aggregate proceeds of $25,000.
On July 21, 2011 the Company issued 69,610 shares of common stock at a price of $0.20 per share for aggregate proceeds of $13,922.
On July 24, 2011 the Company issued 40,000 shares of common stock at a price of $0.50 per share for aggregate proceeds of $20,000.
On October 20, 2011 the Company issued 37,500 shares of common stock at a price of $0.20 per share for aggregate proceeds of $7,500
On November 8, 2011 the Company issued 200,000 shares of common stock at a price of $0.15 per share for aggregate proceeds of $30,000.
On December 7, 2011 the Company issued 75,000 shares of common stock at a price of $0.10 per share for services provided in the amount of $7,500.
On December 15, 2011 the Company issued 455,180 shares of common stock at a price of $0.10 per share for aggregate proceeds of $45,518.
On December 1, 2011 the Company issued 355,695 shares of common stock at a price of $0.20 per share for conversion of a Convertible Debenture Agreement, dated August 15,2011 for a principal amount of Fifty Thousand Euros (50,000), which bears interest at a rate of 8.5%. The aggregate proceeds amounted to $67,513.
On December 19, 2011 the Company issued 150,000 shares of common stock at a price of $0.10 per share for aggregate proceeds of $15,000.
In December 2011, 5BARz AG sold 21,000 common shares with a par value of 0.01 per share, at a price of CHF 3.00 ($3.26 US) per share, for aggregate proceeds of CHF 63,000 (US $75,840). The proceeds received have been credited to additional paid in capital in these consolidated financial statements.
On January 12, 2012 the Company issued 300,000 shares of common stock at a price of $0.10 per share for services for aggregate proceeds of $30,000.
On February 1, 2012 the Company issued 1,500,000 shares of common stock at a price of $0.10 per share for services for aggregate proceeds of $150,000.
On February 1, 2012 the Company issued 50,000 shares of common stock at a price of $0.10 per share for services for aggregate proceeds of $5,000.
On February 7, 2012 the Company issued 500,000 shares of common stock at a price of $0.10 per share for aggregate proceeds of $50,000.
On February 29, 2012 the Company issued 100,000 shares of common stock for services at a price of $0.4799 per share for aggregate proceeds of $47,990.
On February 29, 2012 the Company issued 200,000 shares of common stock for services at a price of $0.10 per share for aggregate proceeds of $20,000.
On March 6, 2012 the Company issued 433,334 shares of common stock at a price of $0.12 per share for aggregate proceeds of $52,000.
On March 7, 2012 the Company issued 150,000 shares of common stock at a price of $0.12 per share for aggregate proceeds of $18,000.
On March 20, 2012 the Company issued 333,334 shares of common stock at a price of $0.15 per share for aggregate proceeds of $50,000.
On March 22, 2012 the Company issued 170,000 shares of common stock at a price of $0.15 per share for aggregate proceeds of $25,500.
On March 26, 2012 the Company issued 50,000 shares of common stock at a price of $0.12 per share for aggregate proceeds of $6,000.
On March 29, 2012 the Company issued 9,000,000 shares of common stock at a price of $0.20 per share in payment to CelLynx Group, Inc. for a 60% for aggregate proceeds of $1,800,000. The shares were issued to acquire the 5BARz cellular technology rights. These consolidated financial statements do not reflect the shares as issued.
On March 29, 2012 the Company issued 1,250,000 shares of 5BARz common stock at a price of $0.20 per share for aggregate proceeds of $250,000, plus $170,000 cash, in payment to two founders of CelLynx Group Inc. for 63,412,638 common shares of CelLynx Group, Inc.
On April 2, 2012 the Company issued 250,000 shares of common stock for services, at a price of $0.12 per share for an aggregate value of $30,270.
On April 18, 2012 the Company issued 100,000 shares of common stock at a price of $0.15 per share for aggregate proceeds of $15,000.
On April 30, 2012 the Company issued 125,000 shares of common stock at a price of $0.12 per share for services for an aggregate value of $14,977.
On April 30, 2012 the Company issued 66,667 shares of common stock at a price of $0.15 per share for services for an aggregate value of $10,000.
On May 3, 2012 the Company issued 80,000 shares of common stock at a price of $0.10 per share for aggregate proceeds of $8,000.
On May 14, 2012 the Company issued 20,000 shares of common stock at a price of $0.10 per share for aggregate proceeds of $2,000.
On June 12, 2012 the Company issued 95,000 shares of common stock at a price of $0.10 per share for aggregate proceeds of $9,500.
On June 21, 2012 the Company issued 2,150,000 shares of common stock at a price of $0.10 per share for services for an aggregate value of $212,685.
On June 27, 2012 the Company issued 50,000 shares of common stock at a price of $0.10 per share for aggregate proceeds of $5,000.
On July 9, 2012 the Company issued 520,000 shares of common stock at a price of $0.10 per share for aggregate proceeds of $52,000.
On July 20, 2012 the Company issued 250,000 shares of common stock at a price of $0.20 per share for services for an aggregate value of $50,000.
On August 10, 2012 the Company issued 500,000 shares of common stock at a price of $0.05 per share for aggregate proceeds of $25,000.
On August 14, 2012 the Company issued 500,000 shares of common stock at a price of $0.05 per share for aggregate proceeds of $25,000.
On August 14, 2012 the Company issued 140,000 units at a price of $0.05 per unit for aggregate proceeds of $7,000. Each unit is comprised of one share and one warrant to acquire a second share at a price of $0.20 per share acquired, with a two year warrant term.
On September 5, 2012 the Company issued 100,000 units at a price of $0.05 per unit for aggregate proceeds of $5,000. Each unit is comprised of one share and one warrant to acquire a second share at a price of $0.20 per share acquired, with a two year warrant term.
On September 10, 2012 the Company issued 401,338 shares of common stock at a price of $0.0299 per share as partial conversion of a note payable in settlement of $12,000 due under that note.
On September 14, 2012 the Company issued 300,000 shares of common stock at a price of $0.05 per share for aggregate proceeds of $15,000.
On October 12, 2012 the Company issued 300,000 units at a price of $0.05 per unit for aggregate proceeds of $15,000. Each unit is comprised of one share and one warrant to acquire a second share at a price of $0.20 per share acquired, with a two year warrant term.
On October 26, 2012 the Company issued 100,000 shares of common stock at a price of $0.05 per share for aggregate proceeds of $5,000.
On December 7, 2012 the Company issued 3,300,824 shares of common stock at a price of $0.05 per share, for services with a total value of $165,041.
On December 12, 2012 the Company issued 400,000 units at a price of $0.05 per unit for aggregate proceeds of $20,000. Each unit is comprised of one share and one warrant to acquire a second share at a price of $0.20 per share acquired, with a two year warrant term. On December 17, 2012 the Company issued 1,200,000 units at a price of $0.05 per unit for aggregate proceeds of $60,000. Each unit is comprised of one share and one warrant to acquire a second share at a price of $0.20 per share acquired, with a two year warrant term. During the quarter ended March 31, 2013 the Company entered into an amending agreement with the unit holder and agreed to cancel the shares and warrants in lieu of the issuance of a convertible debenture.
On December 31, 2012 the Company issued 2,250,000 shares for services at a price of $0.05 per share, for a total value of $112,500.
On January 25, 2013 the Company issued 100,000 shares and warrants in settlement of accounts payable for services rendered in the amount of $5,000.
On February 12, 2013 the Company issued 125,000 shares of common stock at a price of $0.06 per share as partial settlement of $7,500 due under a note payable.
On February 15, 2013 the Company issued 1,440,000 shares of common stock at a price of $0.05 per share, for services with a total value of $72,000.
On February 26, 2013 the Company issued 250,000 shares of common stock at a price of $0.04 per share, for services with a total value of $10,000.
On February 26, 2013 the Company issued 91,780 shares of common stock at a price of $0.05 per share, for services with a total value of $4,589.
On March 1, 2013 the Company issued 175,000 shares of common stock at a price of $0.05 per share, for services with a total value of $8,750.
On March 1, 2013 the Company issued 600,000 shares of common stock at a price of $0.05 per share, for aggregate proceeds of $30,000.
On March 17, 2013 the Company issued 513,827 shares of common stock at a price of $0.05 per share, for services with a total value of $25,691.
On March 31, 2013 the Company issued 100,000 shares of common stock at a price of $0.05 per share, for services with a total value of $5,000.
On various days during the period from January 1, 2013 to June 30, 2013 the Company issued 11,735,000 units at a price of $0.05 per unit for aggregate proceeds of $586,750. Each unit is comprised of one share and one share purchase warrant to acquire a second share at a price of $0.20 per share acquired, with a two year warrant term.
On April 1, 2013 the Company issued 425,000 shares and warrants, with a two year term and $0.20 exercise price, in settlement of accounts payable with a total value of $21,250.
On April 10, 2013 the Company issued 600,000 shares of common stock at a price of $0.05 per share, for aggregate proceeds of $30,000.
On May 15, 2013 the Company issued 200,000 shares of common stock at a price of $0.05 per share for services with a total value of $10,000.
On May 23, 2013 the Company issued 200,000 shares and warrants, with a two year term and $0.20 exercise price, in settlement of accounts payable with a total value of $10,000.
On May 28, 2013 the Company issued 100,000 shares of common stock at a price of $0.05 per share, for services with a total value of $5,000.
On July 1, 2013 the Company issued 331,200 shares and warrants, with a two year term and $0.20 exercise price, for services with a total value of $66,240.
On various days during the period July 25, 2013 to November 18, 2013 the Company issued 27,213,904 units at a price of $0.10 per unit for an aggregate amount of $2,721,390. Of that amount, $2,116,980 was paid in cash and $604,410 was paid by way of settlement of accounts payable and notes payable. Each unit is comprised of one share and one share purchase warrant to acquire a second share at a price of $0.30 per share acquired, with a two year term on the attached warrant. The private placement includes proceeds of $1,566,980 which was raised subsequent to September 30, 2013, and is not included in the balance sheet at September 30, 2013.
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Convertible Securities |
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Convertible Securities |
Note 7 Convertible Securities Convertible Promissory Notes
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Options and Warrants |
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Options and Warrants |
Note 8 Options and Warrants Options 5BARz International Inc.
On May 17, 2013 the Company established the 2013 stock incentive plan for the Company. On that date 4,000,000 stock options were issued to officers of the Company to acquire common stock at a price of $0.10 per share. The Company reports stock-based compensation under ASC 718 Compensation Stock Compensation. ASC 718 requires all share-based payments to employees, including grants of employee stock options, warrants to be recognized in the consolidated financial statements based on their fair values. The Company amortizes the fair value of employee stock options on a straight-line basis over the requisite service period of the awards. The Company accounts for equity instruments issued to non-employees as compensation in accordance with the provisions of ASC 718, which require that each such equity instrument be recorded at its fair value on the measurement date, which is typically the date the services are performed. The Black-Scholes option valuation model is used to estimate the fair value of the warrants or options granted. At May 17, 2013, the Company measured the stock options issued at fair value using the Black-Scholes pricing model and are classified within Level 3 of the valuation hierarchy. The significant assumptions and valuation methods that the Company used to determine fair value and the change in fair value of the Companys derivative financial instruments are provided below:
In addition to the stock options issued pursuant to the 2013 stock option plan as provided above, the Company granted 2,000,000 shares (valued at $160,000) to be provided to the CTO of the Company, to be vested over a period which is the sooner of (i) 12 months of engagement with the Company as CTO, or (ii) the successful completion of the beta test unit as specified in working with the Companys collaborative partner, a multi-national wireless operator. At May 17, 2013, the fair value of the options were determined to be $367,925 based upon the assumption provided above. The option valuations are being amortized over vesting terms ranging from 1-3 years. The stock commitment is being amortized over a one year vesting term. For the nine months ended September 30, 2013, $135,653 was amortized to expense. Warrants 5BARz International Inc.
The following table summarizes the warrant activity to September 30, 2013:
During the nine months ended September 30, 2013 the Company granted 21,819,885 warrants of which 17,194.885 were issued as part of a unit in various equity raises. On September 1, 2013 the Company issued 4,625,000 warrants to a consultant of the Company to acquire common stock at a price of $0.20 per share. At September 1, 2013, the Company measured the warrants issued at fair value using the Black-Scholes pricing model and are classified within Level 3 of the valuation hierarchy. The significant assumptions and valuation methods that the Company used to determine fair value and the change in fair value of the Companys derivative financial instruments are provided below:
At September 1, 2013, the fair value of the 4,625,000 warrants were determined to be $370,979 based upon the assumption provided above. For the period ended September 30, 2013, $370,979 was charged as an expense.
Options CelLynx Group, Inc.
At September 30, 2013, CelLynx Group Inc. has the following Options outstanding;
The number and weighted average exercise prices of all options and warrants exercisable as of September 30, 2013, are as follows:
On August 28, 2013, the Board of Directors of CelLynx Group, Inc. extended the terms and granted additional options to various former employees and directors. The options were expiring as a result of the termination of term of employment of each option holder. The Company has re-valued those options as a result of the significant change in terms thereof. At August 28, 2013, the Company measured the options issued at fair value using the Black-Scholes pricing model and are classified within Level 3 of the valuation hierarchy. The significant assumptions and valuation methods that the Company used to determine fair value and the change in fair value of the Companys derivative financial instruments are provided below:
The fair value of the options to purchase 65,000,000 shares of CelLynx common stock were determined to be $4,500 based upon the assumption provided above. The option valuations are being fully vesting at the date of issuance. For the period ended September 30, 2013, $4,500 was amortized to expense. Warrants CelLynx Group, Inc.
The following table summarizes the warrant activity to September 30, 2013:
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Related Party Transaction |
9 Months Ended |
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Sep. 30, 2013 | |
| Notes to Financial Statements | |
Related Party Transaction |
Note 9 - Related party transactions On December 30, 2010 the Company acquired by way of an assignment agreement all right title and interest in a set of agreements from a Company of which the President and Director is also the President and Director of the reporting Company. The proceeds to be paid for that assignment agreement was comprised of a note payable in the amount of $370,000, and the issuance of 15,600,000 shares of common stock. That amount was paid in full along with interest at a rate of 5% per annum. That note payable was paid in full by June 30, 2012. At September 30, 2013 the Company had a balance due to the related party in the amount of $472 (December 31, 2012 - $19,850). |
Commitments |
9 Months Ended |
|---|---|
Sep. 30, 2013 | |
| Commitments and Contingencies Disclosure [Abstract] | |
Commitments |
Note 10 Commitments
Lease Agreements
On July 1, 2013, the Company entered into an office lease agreement for an office facility in New York, NY. The office lease provides for a monthly payment of $1,371. The lease term is 15 months ending September 30, 2014.
On July 24, 2013 the Company entered into a lease agreement in San Diego, which commenced on October 1, 2013. Pursuant to the terms of that lease, the Company s committed over a period of 39 months to minimum lease payments of $281,154. |
Litigation |
9 Months Ended |
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Sep. 30, 2013 | |
| Commitments and Contingencies Disclosure [Abstract] | |
Litigation |
Note 11 - Litigation
Prior to the Companys investment in CelLynx, on November 8, 2011 CelLynx Group, Inc. was a Defendant in an action brought by Dophinshire L.P., a California Limited Partnership(the Plaintiff) regarding its office space in Mission Viejo, CA. That action has since been dismissed. On November 8, 2011, plaintiff brought suit against the Company for unlawful detainer of offices located at 25910 Acero, Suite 370, Mission Viejo, CA 92691 pursuant to a lease agreement, seeking an unspecified amount of damages not to exceed $25,000. The Company has engaged in settlement negotiations with the plaintiff and management expected to settle has since, by agreement, vacated the leased premises and continues to negotiate a payout of past due rent and penalties and has moved the general office to 4014 Calle Isabella, San Clemente, CA 92672. Past due rents have been included in accounts payable at September 31, 2013 and are subject to adjustments based on the outcome of negotiation.
On August 27, 2012, an action was brought against CelLynx Inc. and Does 1-10, in the Superior Court of California, El Dorado County, Case No. PCL20120700. On August 27, 2012, CSS Properties brought suit against CelLynx, Inc. for unlawful detainer of offices located at 5047 Robert J Matthews Parkway, El Dorado Hills, CA 95762 pursuant to a lease agreement, seeking damages of $24,699, legal fees of $3,000 and late charges of $2,041. The Company had by agreement, vacated the leased premises and continues to negotiate a payout of past due rent and penalties. Past due rents have been included in accounts payable at September 30, 2013 and are subject to adjustments based on the outcome of negotiation.
Prior to the Companys investment in CelLynx, on July 19, 2010 certain claims for unpaid wages were filed against CelLynx. Judgments were obtained commencing in August 2011 for back wages by some of its former employees. Some of those claims have been partially paid and others were expected to be paid in the normal course of business or were to be otherwise defended. Those claims have now been incorporated into California Labor Commission awards in favor of those former employees. Those awards total approximately $263,023 depending on interest charges. It is the intention of Cellynx, Inc. to pay these amounts when proceeds are available.
On October 16, 2012, a complaint was filed in the federal court for the Northern District of California against 5BARz International Inc. and Does 1 - 10, claiming breach of contract and seeking compensatory damages and alleged loss of profits of in excess of $2,500,000, based upon a $150,000 investment made by LA Jolla Cove Investors under certain putative agreements. La Jolla Cove Investors Inc. v. 5BARz International, Inc., 3:12-CV-5333 (N.D. Cal.). On January 3, 2013, the Company and La Jolla Cove Investors, Inc. entered into an agreement for the settlement of the lawsuit for proceeds of $300,000 plus accrued interest from the date of the settlement agreement at a rate of 9%, plus the delivery of 125,000 shares of the common stock of the Company.
On January 13, 2013 a stipulation dismissing action without prejudice and without award of attorneys fees or costs was entered. The Company issued the 125,000 shares but was unable to meet the payment schedule as provided in the settlement agreement. On March 8, 2013 as a result of the default, La Jolla Cove was awarded a judgment in the amount of $300,000 plus accrued interest at a rate of 9% from the date of the settlement agreement plus 125,000 shares which have been issued. On May 22, 2013 the Company made an initial repayment on the loan in the amount of $10,000. During the quarter ended September 30, 2013 the Company repaid $70,000, leaving a balance of $249,307 payable at September 30, 2013. Subsequent to September 30, 2013 the Company paid $50,000 on October 23, 2013 and $50,000 on November 12, 2013, leaving a residual balance due of $149,307.
On March 22, 2013 a complaint was filed in the Supreme Court of the State of New York, County of Nassau against 5BARz International Inc, Daniel Bland and James Vandeberg, by Asher Enterprises, Inc. claiming repayment of three Promissory notes in the principal amount of $81,000, penalties and interest. Asher Enterprises, Inc. vs. 5BARz International Inc., Daniel Bland and James Vandeberg 13-003472(County of Nassau). The claims allege that damages in the amount of the greater of; (i) 200% x $81,000, the remaining outstanding principal amount of the Note, together with accrued and unpaid interest in the unpaid principal amount of the Notes, plus default interest; or (ii) the parity value of the default amount paid in shares as defined in the terms of the agreements. On October 14, 2013 the lawsuit was settled by payment of $70,805.30, paid by the defendant on October 15, 2013.
On March 29, 2011, the Companys subsidiary CelLynx Group, Inc. received a Cease Trading Order from the British Columbia Securities Commission (BCSC) alleging that the Company is in violation of the British Colombia reporting requirements. The BCSC assumed that since two the Company's Directors were domiciled in BC that the company is controlled out of BC and therefore subject to its reporting requirements. The Company denies that premise and is appealing the issuance of the CTO. The effect of the cease trade order was that Cellynx Group, Inc. shares could not be traded by British Columbia residents. At September 30, 2013, the Companys sole Director is not domiciled in BC.
In addition to the above, the Company may become involved in legal proceedings in the ordinary course of business. Such matters are subject to many uncertainties, and outcomes are not predictable with assurance. |
Subsequent Events |
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Subsequent Events |
Note 12 Subsequent events
Issuance of Common Stock
During the period from October 1, 2013 to November 12, 2013, the Company sold the following equity securities;
On November 18, 2013 the Company completed a private placement in the aggregate amount of $2,721,390 by the issuance of 27,213,904 units at a price of $0.10 per unit for aggregate cash proceeds of $2,116,980 and shares issued to settle accounts payable and notes payable of $604,410. Each unit is comprised of one share and one warrant to acquire a second share at a price of $0.30 per share acquired, with a two year warrant term. The cash proceeds received on this private placement after September 30, 2013 was $1,566,980 and the debt component settled after September 30, 2013 was $596,541.
Settlement of Debts
On September 30, 2013, the Company entered into an agreement with CelLynx Group, Inc. for the transfer of liabilities and notes payable in the aggregate amount of $1,440,768 to the Company under the Line of Credit agreement established between the Companies. During the period October 1 to November 18, 2013, the Company settled those liabilities by way of the issuance of $511,957 in securities comprised of the issuance of 5,119,574 units, at a price of $0.10 per unit. Each unit is comprised of one share and one share purchase warrant to acquire a share at a price of $0.30 per unit for a period of 2 years. In addition the Company settled accounts payable in the amount of $92,453 for units on the same terms. As a result, the Company incurred a gain of $928,811 on the settlement of debts.
Lease Agreement
On October 1, 2013 the Company commenced a lease agreement for a 4,337 square foot, Research and Development facility in San Diego, California. The facility lease provides for a monthly payment of $8,023. The lease term is 39 months ending December 31, 2016. The future minimum lease payments are $312,897 over the term of the lease.
Line of Credit Agreement
On September 30, 2013 5BARz International Inc. extended the terms of the line of credit agreement that had been entered into with CelLynx Group, Inc., prior to the maturity date of that agreement of October 5, 2013. In conjunction with the extension of that agreement, CelLynx transferred liabilities and notes payable in the aggregate amount of $1,440,768 to the Company under the Line of Credit agreement. This resulted in an aggregate funding under the terms of the Line of Credit agreement of $2,504,106 to date. The terms of the revised line of credit agreement remained unchanged except that the conversion rights were amended to be at 51% to market, and that the conversion privileges may be amended when the Company CelLynx Group, Inc. no longer have further 3rd party convertible notes
Pro-Forma Financial Information
The financial results reflected in the balance sheet of the Company at September 30, 2013, do not reflect certain debt settlements or the completion of the private placement which was in process at September 30, 2013 and referred to above. The below pro-forma Balance Sheet, integrates the completion of the private placement and debt settlement agreements which were subsequent to September 30, 2013.
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Summary of significant accounting policies (Policies) |
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| Accounting Policies [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Basis of Presentation |
Basis of presentation
The accompanying unaudited condensed consolidated financial statements have been prepared in accordance with generally accepted accounting principles for interim financial information and with the instructions to Form 10-Q and Article 10 of Regulation S-X. Accordingly, they do not include all of the information and footnotes required by accounting principles generally accepted in the United States of America for complete financial statements. In the opinion of management, all adjustments (consisting of normal recurring accruals) considered necessary for a fair presentation have been included. Operating results for the nine months ended September 30, 2013, are not necessarily indicative of the results that may be expected for the year ending December 31, 2013. For further information, refer to the consolidated financial statements and footnotes thereto included in the Company's Annual Report on Form 10-K filed on May 13, 2013 for the fiscal year ended December 31, 2012.
The accompanying consolidated financial statements include the accounts of 5BARz International Inc., and its 94.4% owned subsidiary, 5BARz AG, and its 60% owned subsidiary CelLynx Group, Inc. and that Companys 100% owned subsidiary CelLynx, Inc. All intercompany accounts and transactions have been eliminated in consolidation. |
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Use of estimates |
Use of estimates
The preparation of these financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosures of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Significant estimates include impairment analysis for long lived assets, income taxes, litigation and valuation of derivative instruments. Actual results could differ from those estimates. |
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Intangible assets |
Intangible assets
Acquired patented and unpatented technology, licensing rights and trademarks are capitalized at their fair value. The legal costs, patent registration fees, and models and drawings required for filing patent applications are capitalized if they relate to commercially viable technologies. Commercially viable technologies are those technologies that are projected to generate future positive cash flows in the near term. Legal costs associated with applications that are not determined to be commercially viable are expensed as incurred. All research and development costs incurred in developing the patentable idea are expensed as incurred. Legal fees from the costs incurred in successful defense to the extent of an evident increase in the value of the patents are capitalized.
Capitalized costs for patents are amortized on a straight-line basis over the remaining twenty-year legal life of each patent after the costs have been incurred. Once each patent or trademark is issued, capitalized costs are amortized on a straight-line basis over a period not to exceed 20 years and 10 years, respectively. All research and development costs incurred in developing the patentable idea are expensed as incurred. The licensing right is amortized on a straight-line basis over a period of 10 years. Based on its review, the Company concluded that as of September 30, 2013 and December 31, 2012 there was no impairment of its intangible assets. |
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Goodwill |
Goodwill
Generally accepted accounting principles in the United States require the Company to perform a goodwill impairment test annually and more frequently when negative conditions or a triggering event arise. After an assessment of certain qualitative factors, if it is determined to be more likely than not that the fair value of a reporting unit is less than its carrying amount, entities must perform the quantitative analysis of the goodwill impairment test. Based on its review, the Company concluded that as of September 30, 2013 there was no impairment of its goodwill. |
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Foreign currency translation |
Foreign currency translation
Transactions in foreign currencies have been translated into US dollars using the temporal method. The functional currency of the Companys subsidiary 5BARz AG, is its local currency (Swiss Franc CHF). Under this method, monetary assets and liabilities are translated at the year-end exchange rate. Non-monetary assets have been translated at the historical rate of exchange prevailing at the date of the transaction. Expenses have been translated at the exchange rate at the time of the transaction. Realized and unrealized foreign exchange gains and losses are included in operations. |
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Fair value of financial instruments |
Fair value of financial instruments The carrying amounts of cash and cash equivalents, accounts receivable, accounts payable and accrued expenses and other current liabilities, approximate fair value due to the short-term nature of these instruments. Fair value is defined as an exit price, representing the amount that would be received upon the sale of an asset or payment to transfer a liability in an orderly transaction between market participants. Fair value is a market-based measurement that is determined based on assumptions that market participants would use in pricing an asset or liability. A three-tier fair value hierarchy is used to prioritize the inputs in measuring fair value as follows:
The assets or liabilitys fair value measurement within the fair value hierarchy is based upon the lowest level of any input that is significant to the fair value measurement. The following table provides a summary of the assets that are measured at fair value on a recurring basis.
The following table sets forth a summary of the changes in the fair value of the Companys Level 3 financial liabilities that are measured at fair value on a recurring basis:
The derivative conversion feature liabilities are measured at fair value using the Black-Scholes pricing model and are classified within Level 3 of the valuation hierarchy. The significant assumptions and valuation methods that the Company used to determine fair value and the change in fair value of the Companys derivative financial instruments are provided below:
Level 3 liabilities are valued using unobservable inputs to the valuation methodology that are significant to the measurement of the fair value of the derivate liabilities. For fair value measurements categorized within Level 3 of the fair value hierarchy, the Companys accounting and finance department, which reports to the Chief Financial Officer, determines its valuation policies and procedures. The development and determination of the unobservable inputs for Level 3 fair value measurements and fair value calculations are the responsibility of the Companys accounting and finance department with support from the Companys consultants and which are approved by the Chief Financial Officer.
Level 3 financial liabilities consist of the derivative liabilities for which there is no current market such that the determination of fair value requires significant judgment or estimation. Changes in fair value measurements categorized within Level 3 of the fair value hierarchy are analyzed each period based on changes in estimates or assumptions and recorded as appropriate.
The Company uses the Black-Scholes option valuation model to value Level 3 financial liabilities at inception and on subsequent valuation dates. This model incorporates transaction details such as the Companys stock price, contractual terms, maturity, risk free rates, as well as, volatility.
As of September 30, 2013 there were no transfers in or out of Level 3 from other levels in the fair value hierarchy. |
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Derivative Instruments |
Derivative instruments
The Company evaluates its convertible instruments, options, warrants or other contracts to determine if those contracts or components of those contracts qualify as derivatives to be separately accounted for under ASC Topic 815, Derivatives and Hedging. The result of this accounting treatment is that the fair value of the derivative is marked-to-market each balance sheet date and recorded as a liability. In the event that the fair value is recorded as a liability, the change in fair value is recorded in the statement of operations as other income (expense). Upon conversion or exercise of a derivative instrument, the instrument is marked to fair value at the conversion date and then that fair value is reclassified to equity. Equity instruments that are initially classified as equity that become subject to reclassification under ASC Topic 815 are reclassified to liability at the fair value of the instrument on the reclassification date. |
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Net loss per share |
Net loss per share
The Company reports loss per share in accordance with the ASC Topic 260, Earnings Per Share., which requires presentation of basic and diluted EPS on the face of the income statement for all entities with complex capital structures and requires a reconciliation of the numerator and denominator of the basic EPS computation to the numerator and denominator of the diluted EPS computation. In the accompanying financial statements, basic earnings per share of common stock is computed by dividing net income by the weighted average number of shares of common stock outstanding during the period plus the issuance of common shares, if dilutive, that could result from the exercise of outstanding stock options and warrants. These potentially dilutive securities were not included in the calculation of loss per common share for the three and nine months ended September 30, 2013 or 2012 because their effect would be anti-dilutive. The weighted average number of shares outstanding does not include reciprocal shareholdings, held by the Companys subsidiary, CelLynx Group, Inc. which is reflected as a reduction in capital in excess of par value on the Companys balance sheet.
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Stock-based Compensation |
Stock Based Compensation The Company reports stock-based compensation under ASC 718 Compensation Stock Compensation. ASC 718 requires all share-based payments to employees, including grants of employee stock options, warrants to be recognized in the consolidated financial statements based on their fair values. The Company accounts for equity instruments issued to non-employees as compensation in accordance with the provisions of ASC 718, which require that each such equity instrument be recorded at its fair value on the measurement date, which is typically the date the services are performed. The Black-Scholes option valuation model is used to estimate the fair value of the warrants or options granted. The model includes subjective input assumptions that can materially affect the fair value estimates. The model was developed for use in estimating the fair value of traded options or warrants. The expected volatility is estimated based on the most recent historical period of time equal to the weighted average life of the warrants or options granted
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Reclassifications |
Reclassifications
Certain reclassifications have been made in the financial statements at September 30, 2012 and for the three and nine months then ended to conform to the September 30, 2013 presentation. The reclassifications had no effect on net loss. |
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Recent accounting pronouncements |
Recent accounting pronouncements
FASB, the Emerging Issues Task Force and the SEC have issued certain other accounting standards, updates, and regulations as of September 30, 2013 that will become effective in subsequent periods; however, management does not believe that any of those updates would have significantly affected our financial accounting measures or disclosures had they been in effect during 2013 or 2012, and it does not believe that any of those pronouncements will have a significant impact on our consolidated financial statements at the time they become effective.
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Summary of Accounting Policies (Tables) |
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| Summary Of Accounting Policies Tables | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Fair Value of Financial instruments Assets and Liabilities |
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Fair Value of Financial instruments Black-Scholes option pricing models |
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Acquisition of CelLynx Group, Inc. (Tables) |
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Acquistion of Cellynx Group, Inc. |
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Assets and Liabilities recognized at acquisition date |
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Convertible Securities (Tables) |
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| Convertible Securities Tables | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Convertible Promissory Note |
Convertible Promissory Notes
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Options and Warrants (Tables) |
9 Months Ended | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Sep. 30, 2013 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Options And Warrants Tables | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Options- 5BARz International Inc. |
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Weighted Average Exercise Price of all Options |
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Warrants - 5BARz International Inc. |
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Significant Assumptions and valuation methods - 5BARz International Inc. |
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Options-CelLynx Group, Inc. |
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Significant Assumptions and valuation methods - CelLynx Group, Inc. |
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Warrants - CelLynx Group, Inc. |
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Subsequent Events (Tables) (USD $) |
9 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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| Subsequent Events Tables Usd | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Pro-forma Financial Information |
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Organization and Basis of Reporting (Details) |
9 Months Ended | |
|---|---|---|
|
Sep. 30, 2013
5BARz AG
|
Sep. 30, 2012
CelLynx Group, Inc.
|
|
| Business Acquisition [Line Items] | ||
Agreement date |
Nov. 06, 2011 | Mar. 29, 2012 |
Acquired interest |
94.30% | |
Ownership in Entity |
CeLlynx Inc. | |
Percentage Owned |
60.00% | 100.00% |
Going concern (Details) (USD $) |
59 Months Ended |
|---|---|
Sep. 30, 2013 | |
| Going Concern Details | |
Net loss |
$ 4,975,662 |
Negative Cash Flows |
2,451,387 |
Accumulated Deficit |
$ 4,989,290 |
Summary of Accounting Policies (Details) (USD $) |
9 Months Ended |
|---|---|
Sep. 30, 2013 | |
Derivative Liabilities |
$ 60,772 |
Level 3 |
|
| Level 3 Valuation Methodolgy | |
Stock Price |
$ 0.14 |
Expected volatility |
240.00% |
Risk-free Interest |
0.04% |
Annual Dividend Yield |
0.00% |
Exepected Life (years) |
2 days |
Acquisition of CelLynx Group, Inc.Description (Details Narrative) (USD $) |
1 Months Ended | 0 Months Ended | 3 Months Ended |
|---|---|---|---|
Mar. 29, 2012 |
Jan. 07, 2011
CelLynx Group, Inc.
|
Mar. 29, 2012
CelLynx Group, Inc.
|
|
Common Stock recieved from CelLynx Group, Inc. |
63,412,638 | ||
Purchase Price for common stok of CelLynx Group, Inc. |
$ 634,126 | ||
Cash consideration paid |
170,000 | 170,000 | |
Common Share of the registrant issued |
1,250,000 | ||
Amount of credit facility converted to capital stock of CelLynx Group, Inc. |
$ 73,500 | ||
Amount of Shares of CelLynx Group, Inc. resulting from conversion of credit facility |
350,000,000 |
Investment in CelLynx Group, Inc. (Details) (USD $) |
1 Months Ended |
|---|---|
Mar. 29, 2012 | |
| Business Combinations [Abstract] | |
Cash consideration paid |
$ 170,000 |
1,250,000 common shares of the registrant issued at a market price of $0.20 per share |
250,000 |
Redemption of convertible debt for 350 million shares of Cellynx Group Inc. common stock |
455,000 |
Fair market value of consideration paid |
$ 875,000 |
Investment in CelLynx Group, Inc. (Details) (Parenthetical) (USD $) |
1 Months Ended |
|---|---|
Mar. 29, 2012 | |
Common Stock For Cellynx |
|
Common Share of the registrant issued |
1,250,000 |
Common Stock recieved from Cellynx Group, Inc. |
63,412,638 |
Common Stock |
|
Price Per Unit |
$ 0.20 |
Investment in CelLynx Group, Inc. - Assets and Liabilites recognized (Details) (USD $) |
Sep. 30, 2013 |
Dec. 31, 2012 |
Mar. 29, 2012
Net book Value of Cellynx
|
Mar. 29, 2012
Adjustments
|
Mar. 29, 2012
Valuation attributed to assets acquired
|
|---|---|---|---|---|---|
Current assets |
$ 3,260 | $ 3,260 | |||
Patents, trademarks, and license |
44,718 | 1,155,282 | 1,200,000 | ||
Investment in 5BARz |
1,800,000 | 1,800,000 | |||
Furniture and equipment |
2,113 | 2,113 | |||
Accounts payable and accruals |
(1,756,628) | (1,756,628) | |||
Notes payable (net of discount) |
(403,076) | (403,076) | |||
Accrued Interest |
(62,250) | (62,250) | |||
Derivative liability |
(5,495,425) | (5,026,093) | (469,332) | ||
LOC payable-5BARz (net) |
(586,525) | (586,525) | 0 | ||
Fair value non-controlling interest |
(583,333) | (583,333) | |||
Totals |
(6,449,813) | 6,184,567 | (265,246) | ||
Goodwill |
1,140,246 | 1,140,246 | 1,140,246 | ||
Purchase price |
$ 875,000 |
Acquisition of CelLynx Group, Inc. (Details Narrative) (CelLynx Group, Inc., USD $) |
0 Months Ended | ||
|---|---|---|---|
May 21, 2013 |
May 15, 2012 |
Apr. 13, 2012 |
|
CelLynx Group, Inc. |
|||
Conversion of debt |
$ 9,375 | $ 58,500 | $ 7,700 |
Common Stock Recieved, share |
375,000,000 | 390,000,000 | 51,333,333 |
Investment in 5BARz AG (Details Narrative) (5BARz AG, USD $) |
0 Months Ended | 9 Months Ended |
|---|---|---|
Oct. 06, 2011 |
Sep. 30, 2013 |
|
5BARz AG |
||
| Subsidiary or Equity Method Investee [Line Items] | ||
5BARz AG Common stock issued, shares |
10,000,000 | |
5BARz AG Common stock issued held by company, shares |
5,100,000 | 9,458,000 |
5BARz AG Common stock issued held by officers and a consultant, shares |
450,000 | |
5BARz AG Common stock in escrow, shares |
4,450,000 | |
5BARz AG Common stock, Par Value |
0.01 CHF | 0.01 CHF |
Common Stock Sold, in shares |
122,000 | |
Proceeds of Common Stock |
$ 108,752 | $ 372,728 |
Acquired interest |
94.30% |
Intangible Assets (Details) (USD $) |
Sep. 30, 2013 |
Dec. 31, 2012 |
|---|---|---|
Intangible Assets, Gross |
$ 3,387,406 | $ 3,387,406 |
Accumulated amortization |
||
Intangibles Assets, net |
3,387,406 | 3,387,406 |
Patented and unpatented technology |
||
Intangible Assets, Gross |
3,015,794 | 3,015,794 |
Marketing and distribution agreement |
||
Intangible Assets, Gross |
370,000 | 370,000 |
Trademarks |
||
Intangible Assets, Gross |
264 | 264 |
License rights |
||
Intangible Assets, Gross |
$ 1,348 | $ 1,348 |
Intangible Assets (Details Narrative) (USD $) |
12 Months Ended |
|---|---|
Dec. 31, 2013 | |
Patented and unpatented technology |
|
Life of amortization |
5 years |
Amortization over the next five years |
$ 866,998 |
Trademarks |
|
Life of amortization |
5 years |
Amortization over the next five years |
806 |
Amortization thereafter |
$ 806 |
Maximum |
|
Life of amortization |
20 years |
Minimum |
|
Life of amortization |
10 years |
Cumulative Sales of Stock 2008-2010 (Details) |
1 Months Ended | 1 Months Ended | ||
|---|---|---|---|---|
|
Nov. 13, 2008
Founders Shares
|
Dec. 31, 2010
Common Stock
|
Dec. 31, 2008
Common Stock
|
Nov. 30, 2010
Stock Split
|
|
Issuance of restricted common stock/founders shares |
7,100,000 | 1,776,100 | ||
Forward stock split |
18 | |||
Authorized Shares-before stock split |
100,000,000 | |||
Authorized Shares-After Stock split |
250,000,000 | |||
Cancellation of Common Stock, shares |
87,800,000 | |||
Common stock issued forAcquistions (in shares) |
15,600,000 |
Cumulative Sales of Stock 2011 (Details) (USD $) |
3 Months Ended | 0 Months Ended | 1 Months Ended | ||||||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
|
Dec. 31, 2011
Conversion Of Convertible Debenture
|
Dec. 19, 2011
Common Stock
|
Dec. 15, 2011
Common Stock
|
Dec. 07, 2011
Common Stock
|
Nov. 08, 2011
Common Stock
|
Oct. 20, 2011
Common Stock
|
Jul. 24, 2011
Common Stock
|
Jul. 21, 2011
Common Stock
|
Jul. 18, 2011
Common Stock
|
Jun. 03, 2011
Common Stock
|
Apr. 07, 2011
Common Stock
|
Apr. 04, 2011
Common Stock
|
Mar. 09, 2011
Common Stock
|
Jan. 15, 2011
Common Stock
|
Jan. 10, 2011
Common Stock
|
Dec. 31, 2011
5BARz
|
Sep. 30, 2013
5BARz
|
|
Issuance of common stock (in shares) |
150,000 | 455,180 | 75,000 | 200,000 | 37,500 | 40,000 | 69,610 | 25,000 | 5,000 | 200,000 | 350,000 | 150,000 | 200,000 | 300,000 | 21,000 | ||
Issuance of common stock |
$ 15,000 | $ 45,581 | $ 7,500 | $ 30,000 | $ 7,500 | $ 20,000 | $ 14,000 | $ 25,000 | $ 3,000 | $ 200,000 | $ 350,000 | $ 150,000 | $ 200,000 | $ 300,000 | $ 75,840 | ||
Conversion of Convertible Debenture Agreement (in shares) |
335,695 | ||||||||||||||||
Conversion of Convertible Debenture Agreement (Euro's) |
$ 67,513 | ||||||||||||||||
Price Per Unit |
$ 0.10 | $ 0.10 | $ 0.10 | $ 0.15 | $ 0.20 | $ 0.50 | $ 0.20 | $ 1.00 | $ 0.70 | $ 1.00 | $ 1.00 | $ 1.00 | $ 1.00 | $ 1.00 | $ 3.26 | ||
Cumulative Sales of Stock 2012 -2013 (Details) (USD $) |
0 Months Ended | 4 Months Ended | 9 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Jul. 03, 2013 |
Jun. 30, 2013 |
May 23, 2013 |
May 15, 2013 |
Apr. 10, 2013 |
Apr. 02, 2013 |
Mar. 31, 2013 |
Mar. 17, 2013 |
Mar. 01, 2013 |
Feb. 26, 2013 |
Feb. 15, 2013 |
Feb. 12, 2013 |
Jan. 25, 2013 |
Dec. 31, 2012 |
Dec. 17, 2012 |
Dec. 12, 2012 |
Dec. 07, 2012 |
Oct. 26, 2012 |
Oct. 12, 2012 |
Sep. 14, 2012 |
Sep. 10, 2012 |
Sep. 05, 2012 |
Aug. 14, 2012 |
Aug. 10, 2012 |
Jul. 20, 2012 |
Jul. 09, 2012 |
Jun. 27, 2012 |
Jun. 21, 2012 |
Jun. 12, 2012 |
May 14, 2012 |
May 03, 2012 |
Apr. 30, 2012 |
Apr. 18, 2012 |
Apr. 02, 2012 |
Mar. 26, 2012 |
Mar. 22, 2012 |
Mar. 20, 2012 |
Mar. 07, 2012 |
Mar. 05, 2012 |
Feb. 29, 2012 |
Feb. 07, 2012 |
Feb. 01, 2012 |
Jan. 12, 2012 |
Nov. 18, 2013 |
Sep. 30, 2013 |
|||||
Common Stock |
|||||||||||||||||||||||||||||||||||||||||||||||||
Issuance of common stock (in shares) |
200,000 | 600,000 | 600,000 | 100,000 | 401,338 | 500,000 | 500,000 | 250,000 | 200,000 | 50,000 | 95,000 | 20,000 | 80,000 | 100,000 | 50,000 | 170,000 | 333,334 | 150,000 | 433,334 | 200,000 | 500,000 | 4,540,000 | |||||||||||||||||||||||||||
Units Issued (in shares) |
200,000 | 425,000 | 400,000 | 1,200,000 | 400,000 | 300,000 | 300,000 | 100,000 | 27,213,904 | [1] | 11,735,000 | [1] | |||||||||||||||||||||||||||||||||||||
Issuance of common stock |
$ 586,750 | $ 10,000 | $ 10,000 | $ 30,000 | $ 21,250 | $ 30,000 | $ 20,000 | $ 60,000 | $ 20,000 | $ 5,000 | $ 15,000 | $ 15,000 | $ 12,000 | $ 5,000 | $ 25,000 | $ 25,000 | $ 52,000 | $ 52,000 | $ 5,000 | $ 9,500 | $ 2,000 | $ 8,000 | $ 15,000 | $ 6,000 | $ 25,500 | $ 50,000 | $ 18,000 | $ 52,000 | $ 20,000 | $ 50,000 | $ 2,721,390 | $ 227,000 | |||||||||||||||||
Common stock issued for services (in shares) |
331,200 | 100,000 | 513,827 | 175,000 | 250,000 | 14,400,000 | 100,000 | 2,250,000 | 3,300,824 | 2,150,000 | 125,000 | 250,000 | 100,000 | 1,500,000 | 300,000 | ||||||||||||||||||||||||||||||||||
Common stock issued for services |
66,240 | 5,000 | 25,691 | 8,750 | 10,000 | 72,000 | 5,000 | 112,500 | 165,041 | 212,620 | 14,977 | 30,000 | 47,990 | 150,000 | 30,000 | ||||||||||||||||||||||||||||||||||
Stock Issued During Period, Shares |
125,000 | ||||||||||||||||||||||||||||||||||||||||||||||||
Stock Issued During Period |
7,500 | 1,566,980 | |||||||||||||||||||||||||||||||||||||||||||||||
Price Per Unit |
$ 0.20 | $ 0.05 | $ 0.05 | $ 0.05 | $ 0.05 | $ 0.05 | $ 0.04 | $ 0.05 | $ 0.06 | $ 0.05 | $ 0.05 | $ 0.05 | $ 0.05 | $ 0.05 | $ 0.05 | $ 0.05 | $ 0.0299 | $ 0.20 | $ 0.05 | $ 0.05 | $ 0.20 | $ 0.10 | $ 0.10 | $ 0.10 | $ 0.10 | $ 0.10 | $ 0.10 | $ 0.12 | $ 0.15 | $ 0.12 | $ 0.12 | $ 0.15 | $ 0.15 | $ 0.12 | $ 0.12 | $ 0.4799 | $ 0.10 | $ 0.10 | $ 0.10 | $ 0.10 | $ 0.05 | ||||||||
Warrant price |
0.20 | 0.20 | 0.20 | 0.30 | 0.20 | ||||||||||||||||||||||||||||||||||||||||||||
Cash received for issuance of stock |
2,116,980 | ||||||||||||||||||||||||||||||||||||||||||||||||
Settlement of debt for common stock |
604,410 | ||||||||||||||||||||||||||||||||||||||||||||||||
Common Stock Additional |
|||||||||||||||||||||||||||||||||||||||||||||||||
Units Issued (in shares) |
140,000 | ||||||||||||||||||||||||||||||||||||||||||||||||
Issuance of common stock |
7,000 | ||||||||||||||||||||||||||||||||||||||||||||||||
Common stock issued for services (in shares) |
91,780 | 66,667 | 50,000 | ||||||||||||||||||||||||||||||||||||||||||||||
Common stock issued for services |
$ 4,589 | $ 10,000 | $ 5,000 | ||||||||||||||||||||||||||||||||||||||||||||||
Price Per Unit |
$ 0.05 | $ 0.05 | $ 0.15 | $ 0.10 | |||||||||||||||||||||||||||||||||||||||||||||
| |||||||||||||||||||||||||||||||||||||||||||||||||
Cumulative Sales of Stock Prices (Details) (USD $) |
Nov. 18, 2013
Common Stock
|
Sep. 30, 2013
Common Stock
|
Jul. 03, 2013
Common Stock
|
May 15, 2013
Common Stock
|
Apr. 10, 2013
Common Stock
|
Mar. 31, 2013
Common Stock
|
Mar. 17, 2013
Common Stock
|
Mar. 01, 2013
Common Stock
|
Feb. 26, 2013
Common Stock
|
Feb. 15, 2013
Common Stock
|
Feb. 12, 2013
Common Stock
|
Dec. 31, 2012
Common Stock
|
Dec. 17, 2012
Common Stock
|
Dec. 12, 2012
Common Stock
|
Dec. 07, 2012
Common Stock
|
Oct. 26, 2012
Common Stock
|
Oct. 12, 2012
Common Stock
|
Sep. 14, 2012
Common Stock
|
Sep. 10, 2012
Common Stock
|
Sep. 05, 2012
Common Stock
|
Aug. 14, 2012
Common Stock
|
Aug. 10, 2012
Common Stock
|
Jul. 20, 2012
Common Stock
|
Jul. 09, 2012
Common Stock
|
Jun. 27, 2012
Common Stock
|
Jun. 21, 2012
Common Stock
|
Jun. 12, 2012
Common Stock
|
May 14, 2012
Common Stock
|
May 03, 2012
Common Stock
|
Apr. 30, 2012
Common Stock
|
Apr. 18, 2012
Common Stock
|
Apr. 02, 2012
Common Stock
|
Mar. 26, 2012
Common Stock
|
Mar. 22, 2012
Common Stock
|
Mar. 20, 2012
Common Stock
|
Mar. 07, 2012
Common Stock
|
Mar. 05, 2012
Common Stock
|
Feb. 29, 2012
Common Stock
|
Feb. 07, 2012
Common Stock
|
Feb. 01, 2012
Common Stock
|
Jan. 12, 2012
Common Stock
|
Sep. 30, 2013
Conversion Of Convertible Debenture
|
Mar. 31, 2012
Common Stock for Services
|
Mar. 31, 2012
Excess of Par Value
|
Sep. 30, 2013
Minimum
|
Sep. 30, 2013
Minimum
Common Stock
|
Dec. 31, 2012
Minimum
Common Stock
|
Sep. 30, 2012
Minimum
Common Stock
|
Jun. 30, 2012
Minimum
Common Stock
|
Mar. 31, 2012
Minimum
Common Stock
|
Sep. 30, 2011
Minimum
Common Stock
|
Jun. 30, 2011
Minimum
Common Stock
|
Mar. 30, 2011
Minimum
Common Stock
|
Sep. 30, 2013
Maximum
|
Sep. 30, 2013
Maximum
Common Stock
|
Dec. 31, 2012
Maximum
Common Stock
|
Sep. 30, 2012
Maximum
Common Stock
|
Jun. 30, 2012
Maximum
Common Stock
|
Mar. 31, 2012
Maximum
Common Stock
|
Sep. 30, 2011
Maximum
Common Stock
|
Jun. 30, 2011
Maximum
Common Stock
|
Mar. 30, 2011
Maximum
Common Stock
|
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Price Per Unit |
$ 0.10 | $ 0.05 | $ 0.20 | $ 0.05 | $ 0.05 | $ 0.05 | $ 0.05 | $ 0.05 | $ 0.04 | $ 0.05 | $ 0.06 | $ 0.05 | $ 0.05 | $ 0.05 | $ 0.05 | $ 0.05 | $ 0.05 | $ 0.05 | $ 0.0299 | $ 0.20 | $ 0.05 | $ 0.05 | $ 0.20 | $ 0.10 | $ 0.10 | $ 0.10 | $ 0.10 | $ 0.10 | $ 0.10 | $ 0.12 | $ 0.15 | $ 0.12 | $ 0.12 | $ 0.15 | $ 0.15 | $ 0.12 | $ 0.12 | $ 0.4799 | $ 0.10 | $ 0.10 | $ 0.10 | $ 0.20 | $ 0.10 | $ 3.26 | $ 0.10 | $ 0.10 | $ 0.05 | $ 0.5 | $ 0.10 | $ 0.10 | $ 0.20 | $ 0.70 | $ 1.00 | $ 0.20 | $ 0.20 | $ 0.05 | $ 0.20 | $ 0.15 | $ 0.15 | $ 1.00 | $ 1.00 | $ 1.00 |
Convertible Promissory Notes (Details) (USD $) (USD $) |
9 Months Ended | |
|---|---|---|
Sep. 30, 2013 |
Dec. 31, 2012 |
|
Unpaid Note Principal |
$ 757,784 | |
Unpaid Interest & penalty |
332,098 | |
Notes Payable |
1,089,882 | 993,554 |
Note a |
||
Issue Date |
Feb. 27, 2012 | |
Unpaid Note Principal |
37,500 | |
Unpaid Interest & penalty |
2,771 | |
Notes Payable |
2,771 | 40,832 |
Note b |
||
Issue Date |
May 03, 2012 | |
Unpaid Note Principal |
42,500 | |
Unpaid Interest & penalty |
9,380 | |
Notes Payable |
51,880 | 67,131 |
Note c |
||
Issue Date |
Sep. 18, 2012 | |
Unpaid Note Principal |
13,500 | |
Unpaid Interest & penalty |
2,654 | |
Notes Payable |
16,154 | 20,712 |
Note d |
||
Issue Date |
Feb. 03, 2012 | |
Unpaid Note Principal |
30,000 | |
Unpaid Interest & penalty |
112,649 | |
Notes Payable |
142,649 | 207,500 |
Note d-2 |
||
Issue Date |
Jun. 08, 2012 | |
Unpaid Note Principal |
50,000 | |
Unpaid Interest & penalty |
56,658 | |
Notes Payable |
106,658 | 100,000 |
Note e |
||
Issue Date |
Dec. 17, 2012 | |
Unpaid Note Principal |
80,000 | |
Unpaid Interest & penalty |
5,032 | |
Notes Payable |
85,032 | |
Note f |
||
Issue Date |
Jan. 08, 2013 | |
Unpaid Note Principal |
147,428 | |
Unpaid Interest & penalty |
8,563 | |
Notes Payable |
155,991 | |
5BARz |
||
Unpaid Note Principal |
363,428 | |
Unpaid Interest & penalty |
197,707 | |
Notes Payable |
$ 561,135 | $ 436,175 |
Convertible Promissory Notes (Details Narrative) (USD $) |
9 Months Ended | |
|---|---|---|
Sep. 30, 2013 |
Dec. 31, 2012 |
|
Principal Amount |
$ 757,784 | |
Note Payable |
1,089,882 | 993,554 |
Note a |
||
Issue Date |
Feb. 27, 2012 | |
Principal Amount |
37,500 | |
Date of Maturity |
Nov. 29, 2012 | |
Interest Rate per annum |
8.00% | |
Date |
Sep. 10, 2012 | |
Note paid off |
12,000.00 | |
Common stock issued for debt |
401,338 | |
Date of arrangement |
Sep. 28, 2012 | |
Date Due |
Dec. 31, 2012 | |
Aggregate payments |
25,000 | |
Price per share |
$ 0.0299 | |
Note Payable |
2,771 | 40,832 |
Note b |
||
Issue Date |
May 03, 2012 | |
Principal Amount |
42,500 | |
Date of Maturity |
Feb. 03, 2013 | |
Interest Rate per annum |
8.00% | |
Note Payable |
51,880 | 67,131 |
Note c |
||
Issue Date |
Sep. 18, 2012 | |
Principal Amount |
13,500 | |
Date of Maturity |
Mar. 17, 2013 | |
Interest Rate per annum |
8.00% | |
Accrued interest |
16,154 | |
Note Payable |
16,154 | 20,712 |
Note d |
||
Issue Date |
Feb. 03, 2012 | |
Principal Amount |
30,000 | |
Note Payable |
142,649 | 207,500 |
Convertible Debenture Agreement |
500,000 | |
Convertible Debenture issued to investor |
150,000 | |
Note Receivable exchange for convertible debenture |
400,000 | |
Interest Rate |
8.00% | |
Alleged damages |
2,500,000 | |
Note d-2 |
||
Issue Date |
Jun. 08, 2012 | |
Principal Amount |
50,000 | |
Note Payable |
106,658 | 100,000 |
Note e |
||
Issue Date |
Dec. 17, 2012 | |
Principal Amount |
80,000 | |
Interest Rate per annum |
8.00% | |
Common stock issued for debt |
1,600,000 | |
Accrued interest |
5,032 | |
Note Payable |
85,032 | |
Derivative Liability |
21,440 | |
Note f |
||
Issue Date |
Jan. 08, 2013 | |
Principal Amount |
147,428 | |
Price per share |
$ 0.05 | |
Accrued interest |
8,563 | |
Note Payable |
155,991 | |
Derivative Liability |
$ 39,332 |
Convertible Promissory Notes (Details Narrative) (Parenthetical) |
9 Months Ended | |
|---|---|---|
Sep. 30, 2013 | ||
Note payments |
||
Terms of note |
The Company may settle that note within the first 90 days following the issue date by paying to the Lender 140% of the principle amount of the note plus accrued interest. The Company may settle the note during the period which is 91 days from the issue date of the note to 180 days from the issue date of the note by payment of 150% of the principle amount of the note plus accrued interest. In the event that the note is not repaid 180 days from the date of issue, the note is convertible into common stock. |
|
Note d |
||
Terms of note |
|
Cellynx Group, Inc. - Convertibles Promissory Notes (Details) (USD $) |
9 Months Ended | |
|---|---|---|
Sep. 30, 2013 |
Dec. 31, 2012 |
|
Unpaid Note Principal |
$ 757,784 | |
UnpaidInterestPenalty |
33209800.00% | |
Notes Payable |
1,089,882 | 993,554 |
Note g |
||
Issue Date |
Nov. 10, 2007 | |
Unpaid Note Principal |
262,356 | |
UnpaidInterestPenalty |
6184400.00% | |
Notes Payable |
324,200 | 316,693 |
Note h |
||
Issue Date |
Apr. 05, 2011 | |
Unpaid Note Principal |
50,000 | |
UnpaidInterestPenalty |
3496200.00% | |
Notes Payable |
84,962 | 98,613 |
Note i |
||
Issue Date |
Jan. 05, 2012 | |
Unpaid Note Principal |
50,000 | |
UnpaidInterestPenalty |
3194800.00% | |
Notes Payable |
81,948 | 80,438 |
Note j |
||
Issue Date |
May 24, 2012 | |
Unpaid Note Principal |
19,500 | |
UnpaidInterestPenalty |
458800.00% | |
Notes Payable |
24,088 | 42,433 |
Note k |
||
Issue Date |
Sep. 12, 2012 | |
Unpaid Note Principal |
12,500 | |
UnpaidInterestPenalty |
104900.00% | |
Notes Payable |
13,549 | 19,202 |
CelLnyx |
||
Unpaid Note Principal |
394,356 | |
UnpaidInterestPenalty |
13439100.00% | |
Notes Payable |
$ 528,747 | $ 557,379 |
Cellynx Group, Inc. - Convertibles Promissory Notes (Details Narrative) (USD $) |
9 Months Ended | |
|---|---|---|
Sep. 30, 2013 |
Dec. 31, 2012 |
|
Face Amount |
$ 757,784 | |
Note Payable |
1,089,882 | 993,554 |
Note g |
||
Issue Date |
Nov. 10, 2007 | |
Promissory Note |
250,000 | |
Face Amount |
262,356 | |
Interest Rate per annum |
4.00% | |
Settlement of debt |
27,500 | |
Common stock issued for debt, shares |
275,000 | |
Price per share |
$ 0.10 | |
Note Payable |
324,200 | 316,693 |
Note h |
||
Issue Date |
Apr. 05, 2011 | |
Face Amount |
50,000 | |
Interest Rate per annum |
8.00% | |
Common stock issued for debt, shares |
603,780 | |
Price per share |
$ 0.10 | |
Note Payable |
84,962 | 98,613 |
Note i |
||
Issue Date |
Jan. 05, 2012 | |
Face Amount |
50,000 | |
Interest Rate per annum |
8.00% | |
Settlement of debt |
170,000 | |
Common stock issued for debt, shares |
440,000 | |
Price per share |
$ 0.10 | |
Note Payable |
81,948 | 80,438 |
Note j |
||
Issue Date |
May 24, 2012 | |
Promissory Note |
37,500 | |
Face Amount |
19,500 | |
Interest Rate per annum |
8.00% | |
Settlement of debt |
18,000 | |
Note Payable |
24,088 | 42,433 |
Note k |
||
Issue Date |
Sep. 12, 2012 | |
Face Amount |
12,500 | |
Interest Rate per annum |
8.00% | |
Note Payable |
$ 13,549 | $ 19,202 |
Cellynx Group, Inc. - Convertibles Promissory Notes (Details Narrative) (Parenthetical) |
9 Months Ended |
|---|---|
Sep. 30, 2013 | |
Note g |
|
Terms |
All unpaid principal, together with any then accrued but unpaid interest, shall be due and payable upon the earlier of (i) November 9, 2010 at the written request of the holder to the Company, or (ii) when, upon or after the occurrence of an event of default. The principal amount is convertible into 4.8% of the Company shares outstanding. |
Note h |
|
Terms |
convert principal and unpaid interest on the note into shares of the Companys common stock, with the number of shares issuable determined by dividing the amount to be converted by the conversion price which is equal to 63% of the average of the three lowest trading prices of the Companys common stock over the ten trading days prior to the date of the conversion. |
Note i |
|
Terms |
Holder may convert principal and unpaid interest on the note into shares of the Companys common stock, with the number of shares issuable determined to be the amount obtained by dividing the amount to be converted by the conversion price which is the lesser of $0.0013 per share or 63% of the average of the three lowest trading prices of the Companys common stock over the ten trading days prior to the date of the conversion. |
Options Exercisable 5BARz (Details) (USD $) (5BARz, USD $) |
9 Months Ended |
|---|---|
Sep. 30, 2013 | |
5BARz |
|
| Options exercisable [Abstract] | |
Beginning, Number of Options |
0 |
Options, Granted |
4,000,000 |
Options, Exercised |
|
Options, Cancelled |
|
Ending,Number of Options, outstanding and exercisable |
4,000,000 |
| Weighted Average Exercise Price | |
Weighted Average Exercise Price |
$ 0 |
Weighted Average Exercise Price, Granted |
$ 0.10 |
Weighted Average Exercise Price, Exercised |
|
Weighted Average Exercise Price, Cancelled |
$ 0 |
Weighted Average Exercise Price |
$ 0.10 |
Weighted Average Remaining Contractual Life |
2 years 6 months 3 days |
Options and Warrants 5BARz (Details) (5BARz, USD $) |
0 Months Ended | 1 Months Ended |
|---|---|---|
Sep. 01, 2013 |
May 17, 2013 |
|
5BARz |
||
Stock Price |
$ 0.092 | $ 0.097 |
Expected volatility |
240.00% | 225.00% |
Risk-free Interest |
0.04% | 0.04% |
Annual Dividend Yield |
0.00% | 0.00% |
Exepected Life (years) |
2 years | 3 years |
Stock commitment, shares |
4,625,000 | 2,000,000 |
Fair value of stock options |
$ 370,979 | $ 367,925 |
Share price |
$ 0.20 | $ 0.08 |
Stock options commitment expense |
$ 370,979 | $ 135,653 |
Warrant Activity - 5BARz International Inc. (Details) (USD $) (5BARz, USD $) |
9 Months Ended |
|---|---|
Sep. 30, 2013 | |
5BARz |
|
| Warrant Activity | |
Outstanding at December 31, 2012, Number of Warrants |
2,140,000 |
Granted, Number of shares |
21,819,885 |
Cancelled, Number of shares |
1,600,000 |
Outstanding and exercisable, Number of Warrants |
22,359,885 |
| Weighted Average Exericse Price | |
Outstanding at December31, 2012 |
$ 0.20 |
Granted, Weighted average exercise price |
$ 0.25 |
Cancelled, Weighted average exercise price |
$ 0.20 |
Outstanding and exercisable, Weighted average exercise price |
$ 0.25 |
Outstanding, Average Remaining Contractual Life |
1 year 7 months 1 day |
Options Exercisable CelLynx (Details) (CelLynx, USD $) |
9 Months Ended |
|---|---|
Sep. 30, 2013 | |
CelLynx |
|
| Options exercisable [Abstract] | |
Beginning, Number of Options |
6,400,000 |
Options, Granted |
65,000,000 |
Options, Cancelled |
6,400,000 |
Ending,Number of Options, outstanding and exercisable |
65,000,000 |
| Weighted Average Exercise Price | |
Weighted Average Exercise Price |
$ 0.0008 |
Weighted Average Exercise Price, Granted |
$ 0.0002 |
Weighted Average Exercise Price, Cancelled |
$ 0.0008 |
Weighted Average Exercise Price |
$ 0.0002 |
Weighted Average Remaining Contractual Life |
4 years 5 months 0 days |
Options Assumptions CelLynx (Details) (CelLynx, USD $) (CelLynx, USD $) |
1 Months Ended |
|---|---|
Aug. 28, 2013 | |
CelLynx |
|
Stock Price |
$ 0.0002 |
Expected volatility |
479.00% |
Risk-free Interest |
0.04% |
Annual Dividend Yield |
0.00% |
Exepected Life (years) |
4 years 5 months |
Stock commitment, shares |
5,000,000 |
Fair value of stock options |
$ 4,500 |
Stock options commitment expense |
$ 4,500 |
Warrant Activity - CelLynx Group, Inc. (Details) (USD $) (CelLynx Group, Inc., USD $) |
9 Months Ended |
|---|---|
Sep. 30, 2013 | |
CelLynx Group, Inc. |
|
| Warrant Activity | |
Outstanding at December 31, 2012, Number of Warrants |
5,930,000 |
Granted, Number of shares |
|
Exercised, Number of shares |
|
Expired, Number of shares |
1,430,000 |
Outstanding and exercisable, Number of Warrants |
4,500,000 |
| Weighted Average Exericse Price | |
Outstanding at December31, 2012 |
$ 0.79 |
Granted, Weighted average exercise price |
|
Exercised, Weighted average exercise price |
|
Expired, Weighted average exercise price |
$ 0.10 |
Outstanding and exercisable, Weighted average exercise price |
$ 0.96 |
Outstanding, Average Remaining Contractual Life |
1 year 4 months 0 days |
Related Party transactions (Details) (USD $) |
9 Months Ended | 59 Months Ended | ||
|---|---|---|---|---|
Sep. 30, 2013 |
Sep. 30, 2012 |
Sep. 30, 2013 |
Dec. 31, 2012 |
|
| Related Party Transactions [Abstract] | ||||
Date of Agreement |
Dec. 30, 2010 | |||
Proceeds from Note Payable |
$ 370,000 | |||
Issuance of Common Stock |
15,600,000 | |||
Payment on Note |
19,378 | 97,612 | 463,701 | |
Payment due to Related Party |
$ 472 | $ 472 | $ 19,850 | |
Commitments (Details Narrative) (USD $) |
Jul. 24, 2013 |
|---|---|
| Commitments and Contingencies Disclosure [Abstract] | |
Lease montlhly payments |
$ 1,371 |
Minimum lease payments |
$ 281,154 |
Litigation (Details Narrative) (USD $) |
9 Months Ended |
|---|---|
Sep. 30, 2013 | |
CSS Properties #1 |
|
Date |
10/21/2010 |
Allegations |
Past due rent |
Alleged Damages |
$ 25,000 |
CSS Properties #2 |
|
Date |
8/27/2012 |
Allegations |
Past due rent |
Alleged Damages |
24,699 |
Legal Fees |
3,000 |
Late Charges |
2,041 |
Labor Commission |
|
Date |
7/19/2010 |
Allegations |
Unpaid Wages |
Alleged Damages |
263,023 |
LaJolla Cove Investors Inc. |
|
Date |
10/16/2012 |
Allegations |
Breach of contract |
Alleged Damages |
2,500,000 |
Legal Fees |
300,000 |
La Jolla Cove Dimissal |
|
Date |
1/13/2013 |
Allegations |
Dimssing Action |
Alleged Damages |
300,000 |
Late Charges |
302,796 |
Interest Rate per annum |
9.00% |
Stock Issued During Period, Shares |
125,000 |
Payment on Loan |
10,000 |
Asher Enterprises, Inc. |
|
Date |
3/22/2013 |
Allegations |
Repayment of notes |
Alleged Damages |
$ 81,000 |
Litigation (Details Narrative) (Parenthetical) |
9 Months Ended |
|---|---|
Sep. 30, 2013 | |
LaJolla Cove Investors Inc. |
|
Damages Sought |
Seeking compensatory damages and alleged loss of profits of in excess of $2,500,000, based upon a $150,000 investment made by LA Jolla Cove Investors under certain putative agreements. La Jolla Cove Investors Inc. v. 5Barz International, Inc., 3:12-CV-5333 (N.D. Cal.). On January 3, 2013, the Company and La Jolla Cove Investors, Inc. entered into an agreement for the settlement of the lawsuit for proceeds of $300,000 plus accrued interest from the date of the settlement agreement at a rate of 9%, plus the delivery of 125,000 shares of the common stock of the Company. On January 13, 2013 a stipulation dismissing action without prejudice and without award of attorneys fees or costs was entered. The Company issued the 125,000 shares but was unable to meet the payment schedule as provided in the settlement agreement. On March 8, 2013 as a result of the default, La Jolla Cove was awarded a judgment in the amount of $300,000 plus accrued interest at a rate of 9% from the date of the settlement agreement. The Company intends to pay the balance due once funded. |
Asher Enterprises, Inc. |
|
Damages Sought |
The claims allege that damages in the amount of the greater of; (i) 200% x $81,000, the remaining outstanding principle amount of the Note, together with accrued and unpaid interest in the unpaid principle amount of the Notes, plus default interest; or (ii) the parity value of the default amount paid in shares as defined in the terms of the agreements. The Company intends to file an appearance and defend against the law suit. |
Subsequent Events (Details Narrative) (USD $) |
0 Months Ended | 9 Months Ended | |||
|---|---|---|---|---|---|
|
Nov. 18, 2013
Subsequent Event
|
Sep. 30, 2013
Office Lease
|
||||
Units Issued |
27,213,904 | ||||
Proceeds from Sale of Warrants |
$ 2,721,390 | ||||
Aggregate Proceeds |
2,116,980 | ||||
Line of credit |
1,440,768 | ||||
Aggregate funding of line of credit |
2,504,106 | ||||
Common stock issued for debt |
5,119,574 | ||||
Account payable settlement |
92,453 | ||||
Gain on settlement of debt |
928,811 | ||||
Price of Stock |
$ 0.30 | ||||
Price per share |
$ 0.10 | [1] | |||
Monthly Lease Expense |
8,023 | ||||
Future minimum lease payments |
312,897 | ||||
Stock Issued During Period |
1,566,980 | ||||
Settlement of debt for common stock |
$ 596,541 | ||||
| |||||
Subsequent Events (Details) (USD $) |
Sep. 30, 2013 |
Dec. 31, 2012 |
|---|---|---|
| CURRENT ASSETS: | ||
Cash |
$ 143,754 | $ 48,308 |
Prepaid expenses and deposits |
61,075 | 22,156 |
TOTAL CURRENT ASSETS |
204,829 | 70,464 |
Equipment, net |
7,015 | 4,406 |
| OTHER ASSETS: | ||
Intangible assets |
3,387,406 | 3,387,406 |
Goodwill |
1,140,246 | 1,140,246 |
Total other assets |
4,527,652 | 4,527,652 |
TOTAL ASSETS |
4,739,496 | 4,602,522 |
| CURRENT LIABILITIES: | ||
Accounts payable and accrued expenses |
2,562,262 | 2,445,410 |
Due to escrow agent |
52,321 | 52,321 |
Accrued derivative liabilities |
60,772 | |
Notes payable (net of discount) |
1,089,882 | 993,554 |
TOTAL CURRENT LIABILITIES |
3,765,237 | 3,491,285 |
Related party loans |
472 | 19,850 |
TOTAL LIABILITIES |
3,765,709 | 3,511,135 |
| STOCKHOLDERS' EQUITY | ||
Common stock, $.001 par value, 250,000,000 shares authorized; 160,117,625 shares issued and outstanding as of September 30, 2013 on a pro-forma basis |
138,404 | 117,418 |
Capital in excess of par value |
5,179,130 | 3,226,802 |
Deficit accumulated during the development stage |
(4,989,290) | (2,971,099) |
Accumulated other comprehensive income |
27,250 | 4,272 |
Non-controlling interest |
618,293 | 713,994 |
Total stockholders' equity |
973,787 | 1,091,387 |
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY |
4,739,496 | 4,602,522 |
Adjustments |
||
| CURRENT ASSETS: | ||
Cash |
(1,566,980) | |
| CURRENT LIABILITIES: | ||
Accounts payable and accrued expenses |
(1,018,823) | |
Notes payable (net of discount) |
(514,398) | |
| STOCKHOLDERS' EQUITY | ||
Common stock, $.001 par value, 250,000,000 shares authorized; 160,117,625 shares issued and outstanding as of September 30, 2013 on a pro-forma basis |
21,714 | |
Capital in excess of par value |
2,149,676 | |
Deficit accumulated during the development stage |
928,811 | |
Pro-Forma |
||
| CURRENT ASSETS: | ||
Cash |
1,710,734 | |
Prepaid expenses and deposits |
61,075 | |
TOTAL CURRENT ASSETS |
1,771,809 | |
Equipment, net |
7,015 | |
| OTHER ASSETS: | ||
Intangible assets |
3,387,406 | |
Goodwill |
1,140,246 | |
Total other assets |
4,527,652 | |
TOTAL ASSETS |
6,306,476 | |
| CURRENT LIABILITIES: | ||
Accounts payable and accrued expenses |
1,543,439 | |
Due to escrow agent |
52,321 | |
Accrued derivative liabilities |
60,772 | |
Notes payable (net of discount) |
575,484 | |
TOTAL CURRENT LIABILITIES |
2,232,016 | |
Related party loans |
472 | |
TOTAL LIABILITIES |
2,232,488 | |
| STOCKHOLDERS' EQUITY | ||
Common stock, $.001 par value, 250,000,000 shares authorized; 160,117,625 shares issued and outstanding as of September 30, 2013 on a pro-forma basis |
160,118 | |
Capital in excess of par value |
7,328,806 | |
Deficit accumulated during the development stage |
(4,060,479) | |
Accumulated other comprehensive income |
27,250 | |
Non-controlling interest |
618,293 | |
Total stockholders' equity |
4,073,988 | |
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY |
$ 6,306,476 |