Delaware
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5960
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22-3956444
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(State or other jurisdiction of
incorporation or organization)
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(Primary Standard Industrial
Classification Code Number)
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(I.R.S. Employer
Identification No.)
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Large accelerated filer
¨
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Accelerated filer
¨
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Non-accelerated filer
¨
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Smaller reporting company
þ
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(Do not check if a smaller reporting company)
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Proposed
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Amount to
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Proposed
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Maximum
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Title of Each Class
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be
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Maximum
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Aggregate
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Amount of
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of Securities to be
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Registered
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Offering Price
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Offering Price
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Registration
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Registered
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(1)
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per Share ($)
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($)(2)
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Fee($)
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Shares of Common
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|||||
Stock, par value
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8,346,076
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$
0.
45
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$3,755,734
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$483.74
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$0.001
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|||||
1
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8,346,076 shares are being offered by a direct offering at the price of $
0.
45 per share.
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||||
2
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Estimated solely for purposes of calculating the registration fee in accordance with Rule 457(o) of the Securities Act, based upon the fixed price of the direct offering.
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·
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Up to 2,090,000 are issuable upon conversion of $95,000 of the $370,000 of the senior convertible notes issued to Cobrador Multi-Strategy Partners LP between June 2013 and June 2014 (collectively, the “Cobrador Notes”) and 6,000,000 shares upon partial exercise of the 22,200,000 warrants issued in conjunction with the Cobrador Notes (the “Cobrador Warrants”), subject to the terms and conditions of said Cobrador Notes and Cobrador Warrants. Under the current terms of the Cobrador Notes and Cobrador Warrants, Cobrador Multi-Strategy Partners LP does not have the right to beneficially own (through the conversion of Cobrador Notes or the exercise of Cobrador Warrants) more than 4.99% of our outstanding shares of common stock within sixty (60) days following the date of this Registration Statement. Such aggregate amount of shares as of the date of this Registration Statement is based on (i) 28% of the common stock initially issuable upon conversion of the Cobrador Notes, and (ii) 27% of the number of other shares of common stock otherwise initially issuable upon exercise of the Cobrador Warrants. In addition to both economic and customary anti-dilution adjustments, the conversion price of the Cobrador Notes and the exercise prices of and number of shares issuable pursuant to the Cobrador Warrants are subject to additional adjustments including, but not limited to stock splits, stock dividends, stock combinations, recapitalizations or other similar transactions, and the results of the Measuring Period (80% of the average of the Volume Weighted Average Price (VWAP) for the 10 trading days immediately following the date that the Registration Statement covering the resale of all the shares underlying the Notes and Warrants is declared effective). The conversion price of the Cobrador Notes are subject to a floor price of $0.03 per share. For the purposes of this Registration Statement, no Measuring Period adjustments were assumed.
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·
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256,076 shares of common stock issuable upon exercise of warrants issued to Automated Retail Leasing Partners, LLP (the “ARLP Warrants”) and their designees in connection with providing certain equipment leases to the Company. Such aggregate amount of shares calculated by the Company as of the date of this Registration Statement represents 15% of the number of shares of common stock issuable upon exercise of the ARLP Warrants granted in connection with the lease financing transactions.
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1.
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On April 30, 2014, the Exchange of Securities Agreement by and among Internet Media Services, Inc. and U-Vend Canada Inc. effective January 7, 2014, was amended to reflect the proposed reverse stock split ratio of 1 for 200. Prior to the amendment the January 2014 Agreement used an estimated reverse stock ratio of 1 for 133.
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2.
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The first three issued Cobrador notes and warrant agreements were amended to reflect the proposed stock split ratio of 1 for 200. A reverse stock split ratio of 1 for 50 and 1 for 133 was used in the first three Cobrador notes and warrants. This registration statement reflects the amendment and has adjusted the shares being registered under the Cobrador Notes to be reflective of the 1 for 200 reverse stock split.
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Page
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ABOUT THIS PROSPECTUS
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4
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CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS
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4
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PROSPECTUS DELIVERY REQUIREMENTS
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4
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PROSPECTUS SUMMARY
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4
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SUMMARY FINANCIAL INFORMATION
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6
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RECENT DEVELOPMENTS
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6
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RISK FACTORS
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14
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USE OF PROCEEDS
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21
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SELLING STOCKHOLDERS
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21
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PLAN OF DISTRIBUTION
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22
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BUSINESS
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24
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MARKET FOR COMMON EQUITY AND RELATED STOCKHOLDER MATTERS
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26
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MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
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29
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MANAGEMENT
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34
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EXECUTIVE COMPENSATION
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36
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PRINCIPAL STOCKHOLDERS
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37
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SECURITY OWNERSHIP OF MANAGEMENT | 38 |
CERTAIN RELATIONSHIPS AND RELATED PARTY TRANSACTIONS
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38
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DESCRIPTION OF SECURITIES
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39
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LEGAL MATTERS
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41 |
EXPERTS
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41 |
AVAILABLE INFORMATION | 42 |
DISCLOSURE OF SEC POSITION ON INDEMNIFICATION FOR SECURITIES ACT LIABILITIES
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42 |
INDEX TO FINANCIAL STATEMENTS
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F-1
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Common stock offered by selling stockholders
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8,346,076 shares of common stock.
(1)
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Common stock outstanding on September 1, 2014
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9,371,082 shares of common stock.
(2)
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Terms of the Offering
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The selling stockholders will determine when and how they will sell the common stock offered in this prospectus.
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Use of Proceeds
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We will not receive any proceeds from the sale of common stock offered by the selling stockholders under this prospectus. We may receive proceeds in connection with the exercise of the Warrants, if exercised for cash. We intend to use any such proceeds for working capital and other general corporate purposes. There is no assurance that any of the Warrants will ever be exercised for cash, if at all.
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Risk Factors
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The common stock offered hereby involves a high degree of risk and should not be purchased by investors who cannot afford the loss of their entire investment. Risk Factors relating to our business and prospects include:
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·
the limited operating history with our current business; significant losses incurred to date and “ going concern ” explanatory paragraph in our auditors’ report;
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·
the need for substantial additional financing to become commercially viable;
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·
restrictions on incurring additional debt and pledging our assets;
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·
dependence upon the successful development, commercial launch and acceptance of our planned products and in the successful license of our technology;
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·
effectiveness of the Company’s marketing strategy;
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·
competition; and
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·
our reliance on key members of management.
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(1)
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Of the 8,346,076 shares registered hereunder, up to 8,090,000 shares are issuable to Cobrador Multi-Strategy Partners LP upon conversion of the Cobrador Notes (up to 2,090,000 shares) and upon exercise of the Cobrador Warrants (up to 6,000,000 shares), subject to the terms and conditions of said Cobrador Notes and Cobrador Warrants, calculated by the Company as of the date of this registration statement based on the partial number of shares of common stock issuable upon conversion of the Cobrador Notes and the number of other shares of common stock issuable pursuant to the Notes, and (i) 256,076 shares of common stock representing shares initially issuable upon exercise of the ARLP Warrants.
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(2)
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Does not include (i) 13,250 shares of common stock issuable upon the exercise of outstanding warrants from the 2011-2012 private placement of securities, (ii) 1,350,669 shares of common stock issuable upon the exercise of outstanding warrants held by the pre-acquisition U-Vend Canada shareholders, (iii) 208,334 shares of common stock issuable upon the conversion of outstanding subordinated convertible notes (excluding the Cobrador Notes), (iv)1,716,702 shares of common stock issuable upon the exercise of outstanding warrants related to lease financing obligations with ARLP, (v) 41,667 shares of common stock issuable upon the exercise of outstanding warrants held by ARLP issued in connection with a short term 2014 Promissory Note, (vi) 1,911,480 shares of common stock issuable upon the exercise of outstanding warrants granted in financial advisors in connection with the merger with U-Vend Canada, Inc. on January 7, 2014, (vii) 360,650 shares of common stock issuable upon exercise of stock options granted under the Company’s 2011 Equity Incentive Plan, (viii) 4,639,350 additional shares of common stock reserved for issuance under the Company’s 2011 Equity Incentive Plan, (ix) 4,522,850 shares of common stock issuable under certain earn-out provisions of the January 2014 Exchange of Securities Agreement between Internet Media Services, Inc and U-Vend Canada, Inc., and (x) 22,200,000 shares of common stock issuable upon the exercise of outstanding warrants held by Cobrador Multi-Strategy Partners, LP. and (xi) 520,833 shares of common stock issuable upon the exercise of outstanding warrants held by a director.
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June 30,
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December 31,
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|||||||||||
2014
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2013
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2012
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||||||||||
(unaudited)
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||||||||||||
Balance Sheet Data:
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||||||||||||
Cash
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$
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31,366
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$
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14,620
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$
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1,262
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||||||
Total assets
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$
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1,685,152
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$
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197,603
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$
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226,983
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||||||
Total liabilities
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$
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2,399,175
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$
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526,690
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$
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818,540
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||||||
Total stockholders’ deficiency
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$
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(714,023)
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$
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(329,087
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)
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$
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(591,557
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)
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||||
Total liabilities and stockholders’ deficiency
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$
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1,685,152
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$
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197,603
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$
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226,983
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·
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the date the Registrable Securities may first be sold under Rule 144; and
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·
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the date that any of the Registrable Securities are registered in a registration statement.
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·
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the existing conversion price; and
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·
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80% of the average of the volume-weighted average prices for each of the preceding 10 consecutive trading days.
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·
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November 1, 2013 986,250 warrants with an exercise price of $0.12 per share and a three year term
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·
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March 5, 2014 246,563 warrants with an exercise price of $0.20 per share and a three year term
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·
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June 1, 2014 483,889 warrants with an exercise price of $0.18 per share and a three year term.
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% of Offering
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Dates the underlying securities received
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Dollar Value of the Shares Registered
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Net Proceeds Received
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Discount on underlying securities
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Cobrador Multi-Strategy Partners, LP
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97%
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June 18, 2013 – June 3, 2014
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$4,406,000
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$404,500
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$4,001,500
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Automated Retail Leasing Partners, LLP
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3%
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November 1, 2013 – June 1, 2014
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$588,979
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none
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none
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Types of Payment related to the Cobrador Notes
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Total Payments Made
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Total Potential Payments
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||
Interest Payment
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$ 13,642
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$ 28,992
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Finder’s Fees or Commission
(1)
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$ 29,600
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$ 44,600
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(1)
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Represents a Placement Agent Fee of $29,600 and Cobrador administrative fees of $15,000.
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Market price per share @ issuance
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Conversion price
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Maximum shares @ $0.05
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Face Value
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Market value
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Discount to market
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June 18, 2013
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$ 1.42
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$ 0.05
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1,000,000
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$ 50,000
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$ 1,420,000
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$ 1,370,000
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August 21, 2013
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$ 0.60
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$ 0.05
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1,000,000
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$ 50,000
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$ 600,000
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$ 550,000
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October 17, 2013
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$ 0.28
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$ 0.05
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1,000,000
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$ 50,000
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$ 280,000
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$ 230,000
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November 15, 2013
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$ 0.32
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$ 0.05
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400,000
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$ 20,000
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$ 128,000
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$ 108,000
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December 26, 2013
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$ 0.14
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$ 0.05
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600,000
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$ 30,000
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$ 84,000
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$ 54,000
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January 8, 2014
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$ 0.14
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$ 0.05
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1,000,000
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$ 50,000
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$ 140,000
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$ 90,000
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February 19, 2014
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$ 0.16
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$ 0.05
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500,000
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$ 25,000
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$ 80,000
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$ 55,000
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March 7, 2014
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$ 0.32
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$ 0.05
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500,000
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$ 25,000
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$ 160,000
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$ 135,000
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April 1, 2014
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$ 0.32
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$ 0.05
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500,000
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$ 25,000
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$ 160,000
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$ 135,000
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May 1, 2014
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$ 0.28
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$ 0.05
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500,000
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$ 25,000
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$ 140,000
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$ 115,000
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June 3, 2014
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$ 0.30
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$ 0.05
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400,000
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$ 20,000
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$ 120,000
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$ 100,000
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Total
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7,400,000
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$ 370,000
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$ 3,312,000
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$ 2,942,000
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SERIES A WARRANTS
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Market price per share @ issuance
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Exercise price
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Maximum shares @ $0.05
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Market value
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Exercise cost of warrants
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Possible Discount to market
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June 18, 2013
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$ 1.42
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$ 0.05
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1,500,000
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$ 2,130,000
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$ 75,000
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$ 2,055,000
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August 21, 2013
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$ 0.60
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$ 0.05
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1,500,000
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$ 900,000
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$ 75,000
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$ 825,000
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October 17, 2013
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$ 0.28
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$ 0.05
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1,500,000
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$ 420,000
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$ 75,000
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$ 345,000
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November 15, 2013
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$ 0.32
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$ 0.05
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600,000
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$ 192,000
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$ 30,000
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$ 162,000
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December 26, 2013
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$ 0.14
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$ 0.05
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900,000
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$ 126,000
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$ 45,000
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$ 81,000
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January 8, 2014
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$ 0.14
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$ 0.05
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1,500,000
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$ 210,000
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$ 75,000
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$ 135,000
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February 19, 2014
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$ 0.16
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$ 0.05
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750,000
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$ 120,000
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$ 37,500
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$ 82,500
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March 7, 2014
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$ 0.32
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$ 0.05
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750,000
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$ 240,000
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$ 37,500
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$ 202,500
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April 1, 2014
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$ 0.32
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$ 0.05
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750,000
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$ 240,000
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$ 37,500
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$ 202,500
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May 1, 2014
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$ 0.28
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$ 0.05
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750,000
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$ 210,000
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$ 37,500
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$ 172,500
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June 3, 2014
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$ 0.30
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$ 0.05
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600,000
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$ 180,000
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$ 30,000
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$ 150,000
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Total
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11,100,000
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$ 4,968,000
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$ 555,000
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$ 4,413,000
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SERIES B WARRANTS
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Market price per share @ issuance
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Exercise price
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Maximum shares @ $0.06
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Market value
|
Exercise cost of warrants
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Possible Discount to market
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June 18, 2013
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$ 1.42
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$ 0.06
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1,500,000
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$ 2,130,000
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$ 90,000
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$ 2,040,000
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August 21, 2013
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$ 0.60
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$ 0.06
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1,500,000
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$ 900,000
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$ 90,000
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$ 810,000
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October 17, 2013
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$ 0.28
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$ 0.06
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1,500,000
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$ 420,000
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$ 90,000
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$ 330,000
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November 15, 2013
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$ 0.32
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$ 0.06
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600,000
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$ 192,000
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$ 36,000
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$ 156,000
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December 26, 2013
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$ 0.14
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$ 0.06
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900,000
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$ 126,000
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$ 54,000
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$ 72,000
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January 8, 2014
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$ 0.14
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$ 0.06
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1,500,000
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$ 210,000
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$ 90,000
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$ 120,000
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February 19, 2014
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$ 0.16
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$ 0.06
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750,000
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$ 120,000
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$ 45,000
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$ 75,000
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March 7, 2014
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$ 0.32
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$ 0.06
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750,000
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$ 240,000
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$ 45,000
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$ 195,000
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April 1, 2014
|
$ 0.32
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$ 0.06
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750,000
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$ 240,000
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$ 45,000
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$ 195,000
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May 1, 2014
|
$ 0.28
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$ 0.06
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750,000
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$ 210,000
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$ 45,000
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$ 165,000
|
June 3, 2014
|
$ 0.30
|
$ 0.06
|
600,000
|
$ 180,000
|
$ 36,000
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$ 144,000
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Total
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11,100,000
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$ 4,968,000
|
$ 666,000
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$ 4,302,000
|
|
-
|
the then existing exercise price; and
|
|
-
|
80% of the average of the volume-weighted average prices for each of the 10 consecutive trading days after the registration statement is declared
effective divided by 10.
|
Series A
|
Series B
|
|
Range of market price of the Company’s common stock on the date issuance
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$1.42 to $0.14
|
$1.42 to $0.14
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Exercise price
|
$0.05
|
$0.06
|
Maximum underlying shares
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11,100,000
|
11,100,000
|
Market price for underlying shares
|
$4,968,000
|
$4,968,000
|
Conversion cost of Cobrador warrants
|
$555,000
|
$666,000
|
Total possible discount to market price
|
$4,413,000
|
$4,302,000
|
Series A
|
Series B
|
|
Range of market price of the Company’s common stock on the date issuance
|
$1.42 to $0.14
|
$1.42 to $0.14
|
Exercise price
|
$ 0.05
|
$ 0.06
|
Maximum underlying shares
|
18,500,000
|
18,500,000
|
Market price for underlying shares
|
$8,280,000
|
$8,280,000
|
Conversion cost of Cobrador warrants
|
$925,000
|
$1,110,000
|
Total possible discount to market price
|
$7,355,000
|
$7,170,000
|
November 1, 2013
|
March 5, 2014
|
June 1, 2014
|
Total
|
|
Market price of the Company’s common stock on the date issuance
|
$ 0.40
|
$ 0.20
|
$ 0.30
|
|
Exercise price
|
$ 0.12
|
$ 0.20
|
$ 0.18
|
|
Maximum underlying shares
|
986,250
|
246,563
|
483,889
|
1,716,702
|
Market price for underlying shares
|
$394,500
|
$49,313
|
$145,167
|
$588,980
|
Conversion cost of ARLP warrants
|
$118,350
|
$49,313
|
$87,100
|
$254,763
|
Total possible discount to market price
|
$276,150
|
0
|
$58,067
|
$334,217
|
Initial investment Cobrador Notes
|
Initial Investment Cobrador Notes and warrant exercise @ original prices
|
Initial Investment Cobrador Notes and warrants using floor @ $ 0.03
|
|
Gross proceeds paid
|
$ 370,000
|
$ 370,000
|
$ 370,000
|
Exercise Series A warrant proceeds
|
-
|
$ 555,000
|
$ 925,000
|
Exercise Series B warrant proceeds
|
-
|
$ 666,000
|
$ 1,110,000
|
Less: required payments
|
$ 44,600
|
$ 44,600
|
$ 44,600
|
Possible net proceeds
|
$ 325,400
|
$ 1,546,400
|
$ 2,360,400
|
Combined possible profit from conversion
|
$ 2,942,000
|
$ 11,657,000
|
$ 19,674,998
|
Potential payments
|
$ 73,592
|
$ 73,592
|
$ 73,592
|
Total discount and potential payments
|
$,3,015,592
|
$ 11,730,592
|
$ 19,601,406
|
Discount and potential payment as a % of net proceeds
|
926%
|
759%
|
830%
|
Average discount and potential payment as a % of net proceeds over the term of the Cobrador notes
|
926%
|
759%
|
830%
|
Initial date of transaction with Cobrador
|
June 18,2013
|
Shares owned by non-affiliated owners
|
233,601
|
Number of shares registered for resale by the selling shareholders or affiliates in prior registration statements
|
0
|
Number of shares registered for resale by the selling shareholders or affiliates continued to be held
|
0
|
Number of shares sold in registered resale transactions by the selling shareholders or affiliates
|
0
|
Number of shares registered for resale on behalf of the selling shareholders in the current transaction
|
8,346,076
|
□
|
diversion of our attention from normal daily operations of our vending business to acquiring and assimilating new businesses;
|
|
□
|
the use of substantial portions of any cash we have available;
|
|
□
|
failure to understand the needs and behaviors of users for a newly acquired business or other product;
|
|
□
|
redundancy or overlap between existing products and services, on the one hand, and acquired products and services, on the other hand;
|
|
□
|
difficulty assimilating operations, technologies, products and policies of acquired businesses; and
|
|
□
|
assuming liabilities, including unknown and contingent liabilities, of acquired businesses.
|
|
•
|
fluctuations in revenue generated by kiosk businesses;
|
|
•
|
fluctuations in operating expenses, such as transaction fees and commissions we pay to our host locations;
|
|
•
|
our ability to establish or maintain effective relationships with significant partners, host locations and suppliers on acceptable terms;
|
|
•
|
the amount of service fees that we pay to our host locations;
|
|
•
|
the transaction fees we charge consumers to use our services;
|
|
•
|
the commercial success of our host locations, which could be affected by such factors as general economic conditions, severe weather or strikes;
|
|
•
|
the successful use and integration of assets and businesses acquired or invested in;
|
|
•
|
the level of product and price competition;
|
|
•
|
the timing and cost of, and our ability to develop and successfully commercialize, new or enhanced products and services;
|
|
•
|
activities of, and acquisitions or announcements by, competitors; and;
|
|
•
|
the impact from any impairment of inventory, goodwill, fixed assets or intangibles related to our acquisitions and divestitures.
|
|
·
|
the trading volume of our shares;
|
|
·
|
the number of securities analysts, market-makers and brokers following our common stock;
|
|
·
|
changes in, or failure to achieve, financial estimates by securities analysts;
|
|
·
|
new products or services introduced or announced by us or our competitors;
|
|
·
|
actual or anticipated variations in quarterly operating results;
|
|
·
|
conditions or trends in our business industries;
|
|
·
|
announcements by us of significant contracts, acquisitions, strategic partnerships, joint ventures or capital commitments;
|
|
·
|
additions or departures of key personnel;
|
|
·
|
sales of our common stock; and
|
|
·
|
general stock market price and volume fluctuations of publicly-traded, and particularly microcap, companies.
|
□
|
A standardized risk disclosure document identifying the risks inherent in investment in penny stocks;
|
|
□
|
All compensation received by the broker-dealer in connection with the transaction;
|
|
□
|
Current quotation prices and other relevant market data; and a Monthly account statements reflecting the fair market value of the securities.
|
Name of Selling
Stockholder
)
|
Number of Shares of
Common
Stock Beneficially Owned Prior to
Offering
|
Maximum
Number of
Shares of
Common Stock
to
be Sold Pursuant
to this Prospectus
|
Number of Shares of
Common Stock Owned
After Offering
|
|||||||||||||||||
Number
|
Percent
|
Number
|
Number
|
Percent
|
||||||||||||||||
Cobrador Multi Strategy Partners, LP
(1)
|
467,617
|
4.99%
|
8,090,000
|
0
|
0
|
|||||||||||||||
Automated Retail Leasing Partners
(2)
|
467,617
|
4.99%
|
256,076
|
0
|
0
|
(1)
|
Includes 28% of the shares of common stock which may be issued upon conversion of the Cobrador Notes. This total also includes the shares of common stock which may be issued upon exercise of the Cobrador Warrants, based on the Conversion and Exercise Prices in effect as of the date of this prospectus, based on expected amendments, and assumes that the Measuring Period and any common share adjustment has not occurred. In addition to both economic and standard anti-dilution adjustments, the conversion price of the Cobrador Notes and the exercise prices of and number of shares issuable pursuant to the Cobrador Warrants are subject to additional adjustments including, but not limited to stock splits, stock dividends, stock combinations, recapitalizations or other similar transactions, and the results of the Measuring Period (80% of the average of the VWAPs for the 10 trading days immediately following the date that the registration Statement covering the resale of all the shares underlying the Note and Warrant is declared effective, subject to a floor price of $0.03 per share). No note or warrant shall be convertible or exercisable, as applicable, if after such exercise the note holders would beneficially own more than 4.99% of such shares of common stock then outstanding (as defined under Section 13(d) of the Securities Act of 1933, as amended). If these limits were disregarded the maximum number of shares that could be acquired upon conversion of the notes is 7.4 million and the maximum number of shares that could be acquired upon exercise of the underlying warrants is 22.2 million.
David E. Graber, in his capacity as manager of the general partner of Cobrador Multi Strategy Partners, LP, may be deemed to have investment and voting power over these shares.
|
(2)
|
256,076 shares of common stock representing 15% of shares issuable upon exercise of the ARLP Warrants.
No warrant shall be exercisable if after such exercise the holder would beneficially own more that 4.99% of common stock then outstanding. If this limit was disregarded the maximum number of shares that could be acquired by ARLP is 1,758,369 through warrant conversions.
Ms. Marilyn Kane makes the investment decision on behalf of Automated Retail Leasing Partners, LLP.
|
·
|
on any national securities exchange or quotation service on which the securities may be listed or quoted at the time of sale;
|
|
·
|
in the over-the-counter market;
|
|
·
|
in transactions otherwise than on these exchanges or systems or in the over-the-counter market;
|
|
·
|
through the writing or settlement of options, whether such options are listed on an options exchange or otherwise;
|
|
·
|
ordinary brokerage transactions and transactions in which the broker-dealer solicits purchasers;
|
|
·
|
block trades in which the broker-dealer will attempt to sell the shares as agent but may position and resell a portion of the block as principal to facilitate the transaction;
|
|
·
|
purchases by a broker-dealer as principal and resale by the broker-dealer for its account;
|
|
·
|
an exchange distribution in accordance with the rules of the applicable exchange;
|
|
·
|
privately negotiated transactions;
|
|
·
|
short sales made after the date the Registration Statement is declared effective by the SEC;
|
|
·
|
broker-dealers may agree with a selling security holder to sell a specified number of such shares at a stipulated price per share;
|
|
·
|
a combination of any such methods of sale; and
|
|
·
|
any other method permitted pursuant to applicable law.
|
High
|
Low
|
|||||||
Year ending December 31, 2014
|
||||||||
First Quarter
|
$
|
0.
36
|
$
|
0.
06
|
||||
Second Quarter
|
$
|
0.
40
|
$
|
0.
14
|
High
|
Low
|
|||||||
Year ending December 31, 2013
|
||||||||
First Quarter
|
$
|
1.90
|
$
|
1.60
|
||||
Second Quarter
|
$
|
6.40
|
$
|
0.
80
|
||||
Third Quarter
|
$
|
1.60
|
$
|
0.40
|
||||
Fourth Quarter
|
$
|
0.
40
|
$
|
0.
20
|
High
|
Low
|
|||||||
Year ending December 31, 2012
|
||||||||
First Quarter
|
$
|
30.00
|
$
|
8.00
|
||||
Second Quarter
|
$
|
8.00
|
$
|
4
.00
|
||||
Third Quarter
|
$
|
2.00
|
$
|
2.00
|
||||
Fourth Quarter
|
$
|
2
.00
|
$
|
2.00
|
Plan Category
|
Number of securities
to be issued upon
exercise of outstanding
options, warrants and
rights
|
Weighted average
exercise price of
outstanding
options, warrants
and rights
|
Number of securities remaining available for
future issuance under
equity compensation
Plans (excluding
securities reflected in
column (a))
|
|||||||||
(a)
|
(b)
|
(c)
|
||||||||||
Equity compensation plans approved by securities holders (1)
|
360,650
|
$
|
2.04
|
4,639,350
|
||||||||
Total
|
360,650
|
4,639,350
|
(1)
|
Pursuant to our 2011 Equity Incentive Plan
|
●
|
Our limited operating history with our business model.
|
●
|
The low cash balance and limited financing currently available to us. We may in the near future have a number of obligations that we will be unable to meet without generating additional income or raising additional capital.
|
●
|
Our limited cash resources may not be sufficient to fund continuing losses from operations
|
●
|
Our ability to effect a financing transaction to fund our operations which could adversely affect the value of our stock.
|
●
|
The failure of our products and services to achieve market acceptance.
|
·
|
Level 1, defined as observable inputs such as quoted prices for identical instruments in active markets;
|
·
|
Level 2, defined as inputs other than quoted prices in active markets that are either directly or indirectly observable such as quoted prices for similar instruments in active markets or quoted prices for identical or similar instruments in markets that are not active; and
|
·
|
Level 3, defined as unobservable inputs in which little or no market data exists, therefore requiring an entity to develop its own assumptions, such as valuations derived from valuation techniques in which one or more significant inputs or significant value drivers are unobservable.
|
Name
|
Age
|
Position
|
Director/Officer Since
|
Raymond Meyers
|
57
|
Chief Executive Officer, President,
|
April 2008
|
Treasurer, and Director
|
|||
Paul Neelin
|
54
|
Chief Operations Officer, Secretary and Director
|
January 2014
|
Kathleen Browne
|
59
|
Chief Financial Officer
|
June 2014
|
Alexander A. Orlando
|
51
|
Director
|
April 2008
|
Patrick White
|
61
|
Director
|
October 2009
|
Philip Jones
|
45
|
Director
|
October 2009
|
Name and Principal Position
|
Year
|
Salary
|
Bonus
|
Stock Awards
|
Option Awards
|
All Other Compensation
|
Total
|
|||||||||||||||||||
Raymond J Meyers,
|
2013
|
$
|
180,000
|
$
|
-
|
$
|
-
|
$
|
-
|
$
|
-
|
$
|
180,000
|
|||||||||||||
Chief Executive Officer, then acting Chief Financial Officer
|
2012
|
$
|
-
|
$
|
-
|
$
|
-
|
$
|
-
|
$
|
-
|
$
|
-
|
|||||||||||||
Michael Buechler,
|
2013
|
$
|
-
|
$
|
-
|
$
|
-
|
$
|
-
|
$
|
-
|
$
|
-
|
|||||||||||||
Former Executive Vice President
|
2012
|
$
|
-
|
$
|
-
|
$
|
-
|
$
|
-
|
$
|
-
|
$
|
-
|
Name
|
Number of
Securities
Underlying
Unexercised
Options
|
Number of
Securities
Underlying
Unexercised
Options
|
Option
Exercise
Price
|
Option Expiration
Date
|
||||
(Exercisable)
|
(Un-exercisable)
|
|||||||
Raymond Meyers
|
2,500
|
-
|
$60.00
|
7/21/2016
|
||||
Kathleen Browne
|
350,000
|
100,000
|
$0.30
|
9/10/2019
|
Name of Beneficial Owner
|
Common Shares Beneficially Owned
|
Percentage Beneficially Owned
|
|||
Executive officers and directors
|
|||||
Raymond J. Meyers (1)
|
2,021,409
|
21.6
|
%
|
||
Paul Neelin (2)
|
259,162
|
2.8
|
%
|
||
Patrick White (3)
|
941,652
|
9.7
|
%
|
||
Philip Jones (1)
|
2,552
|
*
|
|||
Alexander A. Orlando (1)
|
2,506
|
*
|
|||
Kathleen Browne (8)
|
250,000
|
2.6
|
%
|
||
All executive officers and directors
|
|||||
as a group (six persons)
|
3,477,280
|
35.0
|
%
|
||
Greater than 5% stockholders
|
|||||
Bohlen Enterprises LLC (4)
|
525,564
|
5.6
|
%
|
||
2800 Middle Country Road
|
|||||
Lake Grove, NY 11755
|
|||||
Kevin and Barb Brady (5)
|
842,375
|
8.2
|
%
|
||
4214 Kane Crescent
|
|||||
Burlington, Ontario, Canada L7M-5C1
|
|||||
QSR Group, Inc. (6)
|
800,000
|
8.5
|
%
|
||
312 Grays Road, PO Box 56013, Fiesta RPO2
|
|||||
Stoney Creek, Ontario, Canada L8G-5C9
|
|||||
Dave Young (2) (7)
|
480,000
|
5.1
|
%
|
||
312 Grays Road, PO Box 56013, Fiesta RPO2
|
|||||
Stoney Creek, Ontario, Canada L8G-5C9
|
|||||
*Less than 1%
|
|
(1)
|
Includes 2,500 shares issuable upon exercise of options.
|
|
(2)
|
Does not include Mr. Neelin’s percentage of any shares issuable under certain earn-out provisions of the Agreement. This amount also does not include any shares that would be transferred to Mr. Neelin in the event of forfeiture by Dave Young. Mr. Young has 480,000 issued and outstanding shares that are subject to a three year vesting schedule through 2017. Any shares not vested are transferable to Mr. Neelin.
|
|
(3)
|
Includes 2,500 shares issuable upon exercise of options and 312,500 issuable upon exercise of warrants.
|
|
(4)
|
Includes 12,500 shares issuable upon exercise of warrants. Mr. Stephen Bohlen makes the investment decisions on behalf of Bohlen Enterprises LLC.
|
|
(5)
|
Includes 416,667 shares issuable upon exercise of warrants and 425,708 shares issuable upon conversion of debt.
|
|
(6)
|
Mr. Greg Hogarth makes the investment decision on behalf of QSR Group, Inc.
|
|
(7)
|
Includes 480,000 shares issued and outstanding that are subject to a three year vesting schedule. Any shares that are not vested are transferable to Mr. Paul Neelin.
|
|
(8)
|
Total options granted of 350,000 shares: 250,000 of which were vested as of September 10, 2014.
|
Face amount of notes
|
Interest rate
|
Maturity Dates
|
Debt Conversion price
|
Warrant coverage and terms
|
|
Cobrador Senior Secured Convertible Notes
|
$370,000
|
7%
|
December 2014 – June 2015
|
$0.05
|
11.1 million Series A with 2 year term and $0.05 exercise price and
11.1 million Series B with 5 year term and $0.06 exercise price
|
Convertible Promissory Note
|
$100,000
|
18%
|
September 2014
|
80% VWAP at conversion
|
416,667 warrants expiring September 2015 with an exercise price of $0.24
|
Convertible Promissory Note
|
$25,000
|
18%
|
Currently due and in discussion for revised due date
|
80% VWAP at conversion
|
104,167 warrants expiring July 2015 with an exercise price of $0.24
|
Subordinated Convertible Promissory Note
|
$50,000
|
10%
|
August 2015
|
$0.30
|
83,334 warrants with a 5 year term and $0.35 exercise price
|
Subordinated Convertible Promissory Note
|
$75,000
|
10%
|
August 2015
|
$0.30
|
125,000 warrants with a 5 year term and $0.35 exercise price
|
Warrants
|
Exercise Price
|
Expiration
|
|||||||
Warrants acquired in U-Vend merger 1/7/14
|
1,350,669
|
$
|
0.24
|
September 2015 – December 2016
|
|||||
2011 Common share private placement warrants
|
12,500
|
$
|
60.00
|
March 2018
|
|||||
2012 Private placements warrants
|
750
|
$
|
30.00
|
March - April 2015
|
|||||
2013 Series A warrants Senior Convertible Notes
|
6,000,000
|
$
|
0.05
|
June - December 2015
|
|||||
2013 Series B warrants Senior Convertible Notes
|
6,000,000
|
$
|
0.06
|
June - December 2018
|
|||||
2013 Lease obligation warrants
|
986,250
|
$
|
0.20
|
November 2016
|
|||||
2014 Warrants for services
|
834,000
|
$
|
0.05
|
July 2015
|
|||||
2014 Warrants for services
|
1,024,000
|
$
|
0.06
|
January 2019
|
|||||
2014 Warrants for services
|
35,000
|
$
|
0.24
|
January 2016
|
|||||
2014 Warrants for services
|
18,480
|
$
|
0.01
|
January 2016
|
|||||
2014 Series A warrants Senior Convertible Notes
|
5,100,000
|
$
|
0.05
|
January 2016- June 2016
|
|||||
2014 Series B warrants Senior Convertible Notes
|
5,100,000
|
$
|
0.06
|
January 2019- June 2019
|
|||||
2014 Lease obligation warrants
|
246,563
|
$
|
0.20
|
March 2017
|
|||||
2014 Lease obligation warrants
|
483,889
|
$
|
0.18
|
May 2017
|
|||||
2014 Issued with Promissory Note
|
41,667
|
$
|
0.24
|
May 2016
|
|||||
2014 Subordinated Convertible Notes
|
208,334
|
|
$
|
0.35
|
July-August 2019
|
||||
2014 Issued in exchange for debt converted
|
312,500
|
$
|
0.24
|
July 2017
|
|||||
2014 Issued with Note Payable - Director | 208,333 | $ | 0.24 | February 2017 |
U-Vend, Inc (formerly Internet Media Services, Inc.) - Audited Consolidated Financial Statements
:
|
|
Report of Independent Registered Public Accounting Firm
|
F-2
|
Consolidated Balance Sheets at December 31, 2013 and 2012
|
F-3
|
Statements of Operations for the Years Ended December 31, 2013 and 2012
|
F-4
|
Statements of Changes in Stockholders' Deficit for the Years Ended December 31, 2013 and 2012
|
F-5
|
Statements of Cash Flows for the Years Ended December 31, 2013 and 2012
|
F-6
|
Notes to Consolidated Financial Statements
|
F-7
|
U-Vend Canada, Inc. - Audited Consolidated Financial Statements
:
|
|
Report of Independent Registered Public Accounting Firm
|
F-18
|
Consolidated Balance Sheets at November 30, 2013 and 2012
|
F-19
|
Statements of Operations for the Years Ended November 30, 2013 and 2012
|
F-20
|
Statements of Changes in Stockholders' Deficit for the Years Ended November 30, 2013 and 2012
|
F-21
|
Statements of Cash Flows for the Years Ended November 30, 2013 and 2012
|
F-22
|
Notes to Consolidated Financial Statements
|
F-23
|
U
-Vend, Inc. Condensed Consolidated Financial Statements (Unaudited) as of March 31, 2014 and 2013 and for the three month periods then ended
|
F-32
|
U-Vend, Inc. Condensed Consolidated Financial Statements (Unaudited) as of June 30, 2014 and 2013 and for the three and six month periods then ended
|
F-44
|
As of
|
||||||||
December 31,
|
December 31,
|
|||||||
2013
|
2012
|
|||||||
ASSETS
|
||||||||
Current assets:
|
||||||||
Cash
|
$
|
14,620
|
$
|
1,262
|
||||
Prepaid expenses and other assets
|
4,114
|
10,169
|
||||||
Receivable from U-Vend, Canada, Inc.
|
162,536
|
-
|
||||||
Current assets of discontinued operations
|
-
|
116,460
|
||||||
Total current assets
|
181,270
|
127,891
|
||||||
Deferred financing costs, net
|
16,333
|
-
|
||||||
Non-current assets of discontinued operations
|
-
|
99,092
|
||||||
Total assets
|
$
|
197,603
|
$
|
226,983
|
||||
LIABILITIES AND STOCKHOLDERS' DEFICIENCY
|
||||||||
Current liabilities:
|
||||||||
Accounts payable
|
$
|
35,192
|
$
|
39,026
|
||||
Accrued expenses
|
28,032
|
61,340
|
||||||
Accrued salary - officer
|
142,608
|
-
|
||||||
Note payable - director
|
50,000
|
-
|
||||||
Senior convertible notes, net of discount of $143,751
|
56,249
|
-
|
||||||
Convertible notes payable
|
-
|
280,034
|
||||||
Revolving note from related party
|
-
|
281,228
|
||||||
Current liabilities of discontinued operations
|
-
|
156,912
|
||||||
Total current liabilities
|
312,081
|
818,540
|
||||||
Warrant liabilities
|
214,609
|
-
|
||||||
Commitments and contingencies (Note 9)
|
-
|
-
|
||||||
Stockholders' deficiency:
|
||||||||
Common stock, $.001 par value, 600,000,000 shares
|
||||||||
authorized, 489,255,193 shares issued and outstanding (24,637,893 - 2012)
|
489,255
|
24,638
|
||||||
Additional paid-in capital
|
955,920
|
770,786
|
||||||
Accumulated deficit
|
(1,774,262
|
)
|
(1,386,981
|
)
|
||||
Total stockholders' deficiency
|
(329,087
|
)
|
(591,557
|
)
|
||||
Total liabilities and stockholders' deficiency
|
$
|
197,603
|
$
|
226,983
|
For the Years Ended
|
||||||||
December 31, 2013
|
December 31, 2012
|
|||||||
Revenue
|
$
|
-
|
$
|
-
|
||||
Operating expenses:
|
||||||||
Salaries and benefits
|
220,421
|
73,716
|
||||||
Professional fees
|
65,780
|
47,219
|
||||||
Other
|
53,684
|
121,571
|
||||||
339,885
|
242,506
|
|||||||
Operating loss
|
(339,885
|
)
|
(242,506
|
)
|
||||
Other income (expenses):
|
||||||||
Loss from change in fair value of notes payable
|
-
|
(105,009
|
)
|
|||||
Amortization of debt discount and deferred financing costs
|
(63,417
|
)
|
-
|
|||||
Interest expense
|
(35,882
|
)
|
(37,440
|
)
|
||||
Gain on extinguishment of debt
|
31,090
|
-
|
||||||
(68,209
|
)
|
(142,449
|
)
|
|||||
Loss before income taxes
|
(408,094
|
)
|
(384,955
|
)
|
||||
Income tax provision
|
(2,200
|
)
|
(4,185
|
)
|
||||
Loss from continuing operations
|
(410,294
|
)
|
(389,140
|
)
|
||||
Discontinued operations:
|
||||||||
Gain from disposal of discontinued operations
|
3,839
|
-
|
||||||
Net income (loss) from discontinued operations
|
19,174
|
(2,858
|
)
|
|||||
Write-down of assets associated with a discounted component, net of income tax effect
|
-
|
(35,000
|
)
|
|||||
23,013
|
(37,858
|
)
|
||||||
Net loss
|
$
|
(387,281
|
)
|
$
|
(426,998
|
)
|
||
Net loss from continuing operations per share- basic and diluted
|
$
|
(0.01
|
)
|
$
|
(0.02
|
)
|
||
Net income (loss) from discontinued operations per share- basic and diluted
|
0.00
|
(0.00
|
)
|
|||||
Net loss per share - basic and diluted
|
$
|
(0.01
|
)
|
$
|
(0.02
|
)
|
||
Weighted average common shares
|
||||||||
outstanding - basic and diluted
|
71,373,884
|
24,313,958
|
Additional
|
Total
|
|||||||||||||||||||
Shares
|
Common
|
Paid-in
|
Accumulated
|
Stockholders’
|
||||||||||||||||
Outstanding
|
Stock
|
Capital
|
Deficit
|
Deficiency
|
||||||||||||||||
Balance at December 31, 2011
|
23,821,000
|
$
|
23,821
|
$
|
685,317
|
$
|
(959,983
|
)
|
$
|
(250,845
|
)
|
|||||||||
Issuance of common stock and warrants for cash
|
200,000
|
200
|
10,300
|
-
|
10,500
|
|||||||||||||||
Stock-based compensation expense
|
-
|
-
|
24,796
|
-
|
24,796
|
|||||||||||||||
Shares issued upon conversion of convertible notes and accrued interest
|
616,893
|
617
|
50,373
|
-
|
50,990
|
|||||||||||||||
Net loss
|
-
|
-
|
-
|
(426,998
|
)
|
(426,998
|
)
|
|||||||||||||
Balance at December 31, 2012
|
24,637,893
|
24,638
|
770,786
|
(1,386,981
|
)
|
(591,557
|
)
|
|||||||||||||
Stock-based compensation expense
|
-
|
-
|
23,496
|
-
|
23,496
|
|||||||||||||||
Shares issued upon conversion of convertible notes and accrued interest
|
464,617,300
|
464,617
|
130,533
|
-
|
595,150
|
|||||||||||||||
Beneficial conversion feature on senior convertible notes
|
-
|
-
|
31,105
|
-
|
31,105
|
|||||||||||||||
Net loss
|
-
|
-
|
-
|
(387,281
|
)
|
(387,281
|
)
|
|||||||||||||
Balance at December 31, 2013
|
489,255,193
|
$
|
489,255
|
$
|
955,920
|
$
|
(1,774,262
|
)
|
$
|
(329,087
|
)
|
For the Years Ended
|
||||||||
December 31, 2013
|
December
31, 2012
|
|||||||
Cash flows from operating activities:
|
||||||||
Net loss
|
$
|
(387,281
|
)
|
$
|
(426,998
|
)
|
||
(Income) loss from discontinued operations
|
(23,013
|
)
|
37,858
|
|||||
Adjustments to reconcile net loss to netcash used by operating activities:
|
||||||||
Stock based compensation
|
23,496
|
24,796
|
||||||
Amortization of debt discount and deferred financing costs
|
63,417
|
-
|
||||||
Gain on extinguishment of debt
|
(31,090
|
)
|
-
|
|||||
Change in provisions for deferred tax liability
|
-
|
541
|
||||||
Impairment of property and equipment
|
-
|
38,200
|
||||||
Loss from change in fair value of notes payable
|
-
|
105,009
|
||||||
(Increase) decrease in assets:
|
||||||||
Prepaid expenses and other assets
|
6,055
|
(222
|
)
|
|||||
Increase in liabilities:
|
||||||||
Accounts payable and accrued expenses
|
48,851
|
53,410
|
||||||
Accrued salary - officer
|
142,608
|
-
|
||||||
Net cash used by continuing operations
|
(156,957
|
)
|
(167,406
|
)
|
||||
Net cash provided by discontinued operations
|
7,653
|
90,621
|
||||||
Net cash used by operating activities
|
(149,304
|
)
|
(76,785
|
)
|
||||
Cash flows from investing activities:
|
||||||||
Advances to U-Vend Canada, Inc.
|
(116,822
|
)
|
-
|
|||||
Net proceeds from sale of LegalStore.com
|
74,000
|
-
|
||||||
Net cash used by investing activities
|
(42,822
|
)
|
-
|
|||||
Cash flows from financing activities:
|
||||||||
Proceeds from sale of common stock
|
-
|
10,500
|
||||||
Proceeds from senior convertible notes, net of financing costs
|
176,500
|
-
|
||||||
Proceeds from notes payable - director
|
50,000
|
-
|
||||||
Net (repayments) borrowings on revolving note from related party
|
(21,016
|
)
|
66,739
|
|||||
Net cash provided by financing activities
|
205,484
|
77,239
|
||||||
Net increase in cash
|
13,358
|
454
|
||||||
Cash - beginning of year
|
1,262
|
808
|
||||||
Cash - end of year
|
$
|
14,620
|
$
|
1,262
|
||||
Cash paid for :
|
||||||||
Income taxes
|
$
|
2,200
|
$
|
3,400
|
||||
Interest
|
$
|
1,711
|
$
|
-
|
||||
Non-cash financing activities:
|
||||||||
Note payable and accrued interest converted to shares of common stock
|
$
|
599,051
|
$
|
50,990
|
||||
Debt discount related to warrant liability and beneficial conversion feature
|
$
|
200,000
|
$
|
-
|
||||
Derivative warrant liability issued for equipment leasing
|
$
|
45,714
|
$
|
-
|
·
|
Level 1, defined as observable inputs such as quoted prices for identical instruments in active markets;
|
·
|
Level 2, defined as inputs other than quoted prices in active markets that are either directly or indirectly observable such as quoted prices for similar instruments in active markets or quoted prices for identical or similar instruments in markets that are not active; and
|
·
|
Level 3, defined as unobservable inputs in which little or no market data exists, therefore requiring an entity to develop its own assumptions, such as valuations derived from valuation techniques in which one or more significant inputs or significant value drivers are unobservable.
|
Net cash proceeds after brokerage fee of $21,000
|
$
|
74,000
|
||
LegalStore.com liabilities assumed
|
136,241
|
|||
Total purchase price
|
210,241
|
|||
LegalStore.com assets
|
206,402
|
|||
Gain on sale
|
$
|
3,839
|
Cash
|
$
|
379
|
||
Account receivable, net
|
26,641
|
|||
Inventory
|
89,440
|
|||
Current assets of discontinued operations
|
$
|
116,460
|
||
Property and equipment, net
|
$
|
1,532
|
||
Other intangibles, net
|
97,560
|
|||
Noncurrent assets of discontinued operations
|
$
|
99,092
|
||
Accounts payable
|
$
|
92,684
|
||
Accrued expenses
|
64,228
|
|||
$
|
156,912
|
December 31, 2013
|
December 31, 2012
|
|||||||
Revenue
|
$
|
95,241
|
$
|
511,283
|
||||
Cost of revenue
|
40,535
|
276,617
|
||||||
Gross profit
|
54,706
|
234,666
|
||||||
Operating expenses
|
35,532
|
237,524
|
||||||
Net income (loss) from discontinued operations
|
19,174
|
(2,858
|
)
|
|||||
Write-down of assets associated with a discontinued component, net of taxes
|
-
|
(35,000
|
)
|
|||||
Gain on disposal of discontinued operations
|
3,839
|
-
|
||||||
$
|
23,013
|
$
|
(37,858
|
)
|
Fair value as of December 31, 2011
|
$
|
223,224
|
||
Changes in fair value and adjustment for default provision
|
105,009
|
|||
Adjustments for conversion
|
(48,199
|
)
|
||
Fair value as of December 31, 2012
|
280,034
|
|||
Adjustments for conversion
|
(280,034
|
)
|
||
Fair value as of December 31, 2013
|
$
|
-
|
Fair value as of December 31, 2012
|
$
|
-
|
||
Derivative warrant liabilities issued
|
214,609
|
|||
Change in fair value
|
-
|
|||
Fair value as of December 31, 2013
|
$
|
214,609
|
Exercise
|
|||||||||
Warrants
|
Price
|
Expiration
|
|||||||
2011 Common share private placement warrants
|
2,500,000
|
$
|
0.30
|
March 2018
|
|||||
2011 Convertible notes warrants
|
16,667
|
$
|
0.30
|
June 2014
|
|||||
2012 Private placements warrants
|
150,000
|
$
|
0.15
|
March - April 2015
|
|||||
2013 Series A warrants Senior Convertible Notes
|
225,000,000
|
$
|
0.001
|
October-November 2014
|
|||||
2013 Series A warrants Senior Convertible Notes
|
300,000,000
|
$
|
0.00025
|
January 2014 - March 2015
|
|||||
2013 Series B warrants Senior Convertible Notes
|
225,000,000
|
$
|
0.0012
|
June-August 2018
|
|||||
2013 Series B warrants Senior Convertible Notes
|
300,000,000
|
$
|
0.0003
|
October - December 2018
|
|||||
2013 Lease obligation with U-Vend
|
197,250,000
|
$
|
0.006
|
November 2016
|
|||||
1,249,916,667
|
Warrants
|
Exercise Price
|
Expiration
|
|||||||
2011 Common share private placement warrants
|
2,500,000
|
$
|
0.30
|
March 2018
|
|||||
2011 Convertible Notes warrants
|
16,667
|
$
|
0.30
|
June 2014
|
|||||
2012 Private Placements warrants
|
150,000
|
$
|
0.15
|
March - April 2015
|
|||||
2,666,667
|
Weighted Average
|
Weighted Average
|
Aggregate Intrinsic
|
||||||||||
Options
|
Exercise Price
|
Contractual life
|
Value
|
|||||||||
Outstanding at December 31, 2011
|
3,015,000
|
$
|
0.27
|
|||||||||
Options cancelled
|
(355,000)
|
0.10
|
||||||||||
Outstanding at December 31, 2012
|
2,660,000
|
0.29
|
||||||||||
Options cancelled
|
(30,000)
|
0.10
|
||||||||||
Outstanding at December 31, 2013
|
2,630,000
|
0.29
|
5.7 years
|
$
|
-
|
|||||||
Exercisable at December 31, 2013
|
1,753,333
|
$
|
0.29
|
5.7 years
|
$
|
-
|
2013
|
2012
|
|||||||
Current:
|
||||||||
Federal
|
$
|
-
|
$
|
-
|
||||
State
|
2,200
|
3,644
|
||||||
Total current
|
2,200
|
3,644
|
||||||
Deferred
|
||||||||
Federal
|
(128,472
|
)
|
(119,282
|
)
|
||||
State
|
(15,983
|
)
|
(37,514
|
)
|
||||
Total deferred
|
(144,455
|
)
|
(156,796
|
)
|
||||
Less increase in allowance
|
144,455
|
157,337
|
||||||
Net deferred
|
-
|
541
|
||||||
Total income tax provision
|
$
|
2,200
|
$
|
4,185
|
2013
|
2012
|
|||||||
Deferred tax assets (liabilities):
|
||||||||
Net operating loss carryforwards
|
$
|
499,696
|
$
|
419,720
|
||||
Depreciable and amortizable assets
|
-
|
20,938
|
||||||
Prepaid expense
|
(888
|
)
|
(1,001
|
)
|
||||
Fair market value adjustments
|
-
|
52,580
|
||||||
Stock based compensation
|
15,769
|
9,437
|
||||||
Beneficial conversion feature
|
(8,623
|
)
|
-
|
|||||
Bad debt reserve
|
-
|
766
|
||||||
Accrued salary
|
54,519
|
-
|
||||||
Total
|
560,473
|
502,440
|
||||||
Less valuation allowance
|
(560,473
|
)
|
(502,440
|
)
|
||||
Net deferred tax (liabilities)
|
$
|
-
|
$
|
-
|
2013
|
2012
|
||
Statutory United States Federal rate
|
34.0%
|
34.0%
|
|
State income taxes net of federal benefit
|
2.2%
|
3.6%
|
|
Change in valuation reserves
|
(36.2%)
|
(40.5%)
|
|
Permanent differences
|
(0.6%)
|
(1.5%)
|
|
Other
|
-
|
3.3%
|
|
Effective tax rate (provision)
|
(0.6%)
|
(1.1%)
|
2014
|
$
|
57,200
|
||
2015
|
57,200
|
|||
2016
|
52,434
|
|||
Total minimum lease payments
|
166,834
|
|||
Guaranteed residual value
|
86,191
|
|||
$
|
253,025
|
2013
|
2012
|
|||||||
Revenue
|
$
|
23,592
|
$
|
5,094
|
||||
Operating loss
|
$
|
(683,615
|
)
|
$
|
(345,120
|
)
|
||
Net loss
|
$
|
(808,354
|
)
|
$
|
(509,160
|
)
|
||
Basic and diluted earnings per share
|
$
|
(0.00
|
)
|
$
|
(0.00
|
)
|
U-VEND CANADA, INC.
|
||||||||
CONSOLIDATED BALANCE SHEETS
|
||||||||
(expressed in Canadian dollars)
|
||||||||
As of
|
||||||||
November 30,
|
November 30,
|
|||||||
2013
|
2012
|
|||||||
ASSETS
|
||||||||
Current assets:
|
||||||||
Cash
|
$
|
9,763
|
$
|
59
|
||||
Prepaid expenses and other assets
|
274
|
-
|
||||||
Inventory (net)
|
11,715
|
-
|
||||||
Total current assets
|
21,752
|
59
|
||||||
Property and equipment (net)
|
232,657
|
-
|
||||||
Security deposits
|
6,631
|
-
|
||||||
Total noncurrent assets
|
239,288
|
-
|
||||||
Total assets
|
$
|
261,040
|
$
|
59
|
||||
LIABILITIES AND STOCKHOLDERS' DEFICIENCY
|
||||||||
Current liabilities:
|
||||||||
Accounts payable
|
$
|
54,329
|
$
|
22,150
|
||||
Accrued expenses
|
35,901
|
69,330
|
||||||
Convertible notes payable, net of unamortized discount
|
164,370
|
31,979
|
||||||
Payable to Internet Media Services, Inc.
|
147,323
|
-
|
||||||
Due to officers
|
49,812
|
50,274
|
||||||
Current portion of capital lease obligations
|
32,082
|
-
|
||||||
Total current liabilities
|
483,817
|
173,733
|
||||||
Long term capital lease obligations (net of unamortized discount)
|
117,238
|
-
|
||||||
Total liabilities
|
601,055
|
173,733
|
||||||
Commitments and contingencies (Note 9)
|
-
|
-
|
||||||
Stockholders' deficiency
|
||||||||
Class A common stock, no par value, unlimited authorized shares;
|
||||||||
11,117,737 issued and outstanding (10,329,404 at November 30, 2012)
|
||||||||
Additional paid-in capital
|
539,393
|
307,674
|
||||||
Accumulated deficit
|
(879,408
|
)
|
(481,348
|
)
|
||||
Total stockholders' deficiency
|
(340,015
|
)
|
(173,674
|
)
|
||||
Total liabilities and stockholders' deficiency
|
$
|
261,040
|
$
|
59
|
U-VEND CANADA, INC.
|
||||||||
CONSOLIDATED STATEMENTS OF OPERATIONS
|
||||||||
(expressed in Canadian dollars)
|
||||||||
For the Years Ended
|
||||||||
November 30,
|
November 30,
|
|||||||
2013
|
2012
|
|||||||
Revenue
|
$
|
14,308
|
$
|
5,094
|
||||
Costs of revenue
|
11,682
|
2,871
|
||||||
Gross profit
|
2,626
|
2,223
|
||||||
Operating expenses:
|
||||||||
Selling, general and administrative
|
346,356
|
104,837
|
||||||
Operating loss
|
(343,730
|
)
|
(102,614
|
)
|
||||
Other expenses:
|
||||||||
Interest expense
|
30,641
|
16,367
|
||||||
Other
|
23,689
|
1,039
|
||||||
54,330
|
17,406
|
|||||||
Loss before income tax provision
|
(398,060
|
)
|
(120,020
|
)
|
||||
Income tax provision
|
-
|
-
|
||||||
Net loss
|
$
|
(398,060
|
)
|
$
|
(120,020
|
)
|
||
Net loss per share - basic and diluted
|
$
|
(0.04
|
)
|
$
|
(0.01
|
)
|
||
Weighted average common shares
|
||||||||
outstanding - basic and diluted
|
10,673,737
|
10,272,338
|
U-VEND CANADA, INC.
|
||||||||||||||||
CONSOLIDATED STATEMENTS OF STOCKHOLDERS' DEFICIENCY
|
||||||||||||||||
(expressed in Canadian dollars)
|
||||||||||||||||
For the Years Ended November 30, 2013 and 2012
|
||||||||||||||||
Common Stock
|
Additional Paid-in
|
Accumulated
|
Total
Stockholders
|
|||||||||||||
Shares
|
Capital
|
Deficit
|
Deficiency
|
|||||||||||||
Balances at November 30, 2011
|
10,196,238
|
263,000
|
(361,328
|
)
|
(98,328
|
)
|
||||||||||
Sale of common stock and warrants
|
87,333
|
24,000
|
-
|
24,000
|
||||||||||||
Stock based compensation
|
45,833
|
11,000
|
-
|
11,000
|
||||||||||||
Warrants and beneficial conversion feature issued with convertible notes
|
-
|
9,674
|
-
|
9,674
|
||||||||||||
Net loss
|
-
|
-
|
(120,020
|
)
|
(120,020
|
)
|
||||||||||
Balances at November 30, 2012
|
10,329,404
|
307,674
|
(481,348
|
)
|
(173,674
|
)
|
||||||||||
Sale of common stock and warrants
|
334,166
|
85,000
|
-
|
85,000
|
||||||||||||
Stock based compensation
|
203,645
|
55,021
|
-
|
55,021
|
||||||||||||
Beneficial conversion feature issued with convertible notes
|
-
|
31,573
|
-
|
31,573
|
||||||||||||
Common stock issued to settle accrued expenses
|
250,522
|
60,125
|
-
|
60,125
|
||||||||||||
Net loss
|
-
|
-
|
(398,060
|
)
|
(398,060
|
)
|
||||||||||
Balances at November 30, 2013
|
11,117,737
|
$
|
539,393
|
$
|
(879,408
|
)
|
$
|
(340,015
|
)
|
U-VEND CANADA, INC.
|
||||||||
CONSOLIDATED STATEMENTS OF CASH FLOWS
|
||||||||
(expressed in Canadian dollars)
|
||||||||
For the Years Ended
|
||||||||
November 30,
|
November 30,
|
|||||||
2013
|
2012
|
|||||||
Cash flows from operating activities:
|
||||||||
Net loss
|
$
|
(398,060
|
)
|
$
|
(120,020
|
)
|
||
Adjustments to reconcile net loss to net
|
||||||||
cash used by operating activities:
|
||||||||
Depreciation expense
|
3,857
|
-
|
||||||
Stock based compensation
|
55,021
|
11,000
|
||||||
Provision for inventory reserve
|
2,000
|
-
|
||||||
Amortization of debt discounts
|
11,526
|
5,653
|
||||||
Amortization of capital lease debt discount
|
1,270
|
-
|
||||||
Change in fair value of convertible notes payable
|
23,438
|
-
|
||||||
Changes in operating assets and liabilities:
|
||||||||
Increase in prepaid and other assets
|
(274
|
)
|
-
|
|||||
Increase in inventory
|
(13,715
|
)
|
-
|
|||||
Increase in security deposit
|
(6,631
|
)
|
-
|
|||||
Increase in accounts payable and accrued expenses
|
58,875
|
41,323
|
||||||
Net cash used by operating activities
|
(262,693
|
)
|
(62,044
|
)
|
||||
Cash flows from investing activities:
|
||||||||
Purchase of property and equipment
|
(40,284
|
)
|
-
|
|||||
Net cash used by investing activities
|
(40,284
|
)
|
-
|
|||||
Cash flows from financing activities:
|
||||||||
Proceeds from sale of common stock and warrants
|
85,000
|
24,000
|
||||||
Proceeds from issuance of convertible notes
|
129,000
|
36,000
|
||||||
(Repayments) advances from officers
|
(462
|
)
|
2,089
|
|||||
Advances from Internet Media Services, Inc.
|
101,609
|
-
|
||||||
Principal payments under lease obligations
|
(2,466
|
)
|
-
|
|||||
Net cash provided by financing activities
|
312,681
|
62,089
|
||||||
Net increase in cash
|
9,704
|
45
|
||||||
Cash - beginning of year
|
59
|
14
|
||||||
Cash - end of year
|
$
|
9,763
|
$
|
59
|
||||
Cash paid for:
|
||||||||
Interest
|
$
|
10,663
|
$
|
9,004
|
||||
Income taxes
|
$
|
-
|
$
|
-
|
||||
Non-cash financing activities:
|
||||||||
Issuance of debt discounts on convertible notes
|
$
|
31,573
|
$
|
9,674
|
||||
Issuance of debt discounts on capital leases
|
$
|
45,714
|
$
|
-
|
||||
Common stock used to settle accrued expenses
|
$
|
60,125
|
$
|
-
|
||||
Property and equipment financed by capital leases
|
$
|
196,230
|
$
|
-
|
Life
|
|||||
Electronic kiosks
|
7 years
|
$
|
25,484
|
||
Freezers
|
5 years
|
14,800
|
|||
Capitalized lease equipment
|
7 years
|
196,230
|
|||
236,514
|
|||||
Less: Accumulated depreciation
|
(3,857
|
)
|
|||
Property and equipment (net)
|
$
|
232,657
|
2014
|
$
|
57,200
|
||
2015
|
57,200
|
|||
2016
|
52,434
|
|||
Total minimum lease payments
|
166,834
|
|||
Guaranteed residual value
|
86,191
|
|||
253,025
|
||||
Less: Amount represented interest
|
(59,261
|
)
|
||
Present value of minimum lease payments and guaranteed residual value
|
193,764
|
|||
Less: Current portion of capital lease obligations
|
(32,082
|
)
|
||
Long term capital lease obligations and guaranteed residual value
|
161,682
|
|||
Less: Unamortized debt discount on capital leases
|
(44,444
|
)
|
||
Long term capital lease obligations and guaranteed residual value, net
|
$
|
117,238
|
2013
|
2012
|
|||||||
Convertible notes payable outstanding 12/1
|
$
|
31,979
|
$
|
-
|
||||
Convertible notes issued during the year
|
129,000
|
36,000
|
||||||
Change in fair value of convertible notes
|
23,438
|
-
|
||||||
Debt discounts issued
|
(31,573
|
)
|
(9,674
|
)
|
||||
Amortization of debt discounts
|
11,526
|
5,653
|
||||||
Convertible notes payable outstanding 11/30
|
$
|
164,370
|
$
|
31,979
|
Exercise Price
|
2013
|
2012
|
Expiration
|
||||
Class A Common Stock Warrant
|
$0.12
|
400,000
|
400,000
|
May 20, 2015
|
|||
Class A Common Stock Warrant
|
$0.24
|
104,167
|
-
|
September 14, 2015
|
|||
Class A Common Stock Warrant
|
$0.24
|
20,833
|
20,833
|
December 22, 2015
|
|||
Class A Common Stock Warrant
|
$0.24
|
909,001
|
132,667
|
January 7, 2016
|
|||
Class A Common Stock Warrant
|
$1.00
|
5,000
|
5,000
|
September 16, 2015
|
|||
Class A Common Stock Warrant
|
$1.00
|
16,000
|
16,000
|
October 18, 2015
|
|||
Class A Common Stock Warrant
|
$1.00
|
4,000
|
4,000
|
December 8, 2015
|
|||
1,459,001
|
578,500
|
2013
|
2012
|
|||||||
Current
|
||||||||
Federal and provincial
|
$
|
-
|
$
|
-
|
||||
Deferred
|
||||||||
Federal
|
(26,629
|
)
|
(12,294
|
)
|
||||
Provincial
|
(17,753
|
)
|
(8,195
|
)
|
||||
Less increase in valuation allowance
|
44,382
|
20,489
|
||||||
Net deferred
|
-
|
-
|
||||||
Total income tax provision
|
$
|
-
|
$
|
-
|
2013
|
2012
|
|||||||
Deferred tax assets (liabilities)
|
||||||||
Net operating loss carryforwards
|
$
|
107,356
|
$
|
62,974
|
||||
Less valuation allowance
|
(107,356
|
)
|
(62,974
|
)
|
||||
Gross deferred tax assets (liabilities)
|
$
|
-
|
$
|
-
|
2013
|
2012
|
|||||||
Statutory Federal rate
|
15.0
|
%
|
15.0
|
%
|
||||
Provincial rate
|
10.0
|
%
|
10.0
|
%
|
||||
Permanent difference
|
(12
|
)%
|
(7.9
|
)%
|
||||
Change in valuation reserve
|
(13
|
)%
|
(17.1
|
)%
|
||||
Effective tax rate
|
0.0
|
%
|
0.0
|
%
|
2014
|
$
|
31,007
|
||
2015
|
29,095
|
|||
2016
|
29,516
|
|||
2017
|
28,602
|
|||
2018
|
22,325
|
|||
2019
|
8,280
|
|||
$
|
148,825
|
As of
|
||||||||
March 31,
|
December 31,
|
|||||||
2014
|
2013
|
|||||||
(Unaudited)
|
||||||||
ASSETS
|
||||||||
Current assets:
|
||||||||
Cash
|
$ | 17,899 | $ | 14,620 | ||||
Accounts receivable
|
1,385 | - | ||||||
Inventory (net)
|
15,692 | - | ||||||
Prepaid expenses and other assets
|
3,637 | 4,114 | ||||||
Receivable from U-Vend, Canada, Inc.
|
- | 162,536 | ||||||
Total current assets
|
38,613 | 181,270 | ||||||
Other assets:
|
||||||||
Property and equipment (net)
|
326,144 | - | ||||||
Security deposits
|
6,631 | - | ||||||
Deferred financing costs (net)
|
20,208 | 16,333 | ||||||
Intangible asset (net)
|
412,300 | - | ||||||
Goodwill
|
732,260 | - | ||||||
Total noncurrent assets
|
1,497,543 | 16,333 | ||||||
Total assets
|
$ | 1,536,156 | $ | 197,603 | ||||
LIABILITIES AND STOCKHOLDERS' DEFICIENCY
|
||||||||
Current liabilities:
|
||||||||
Accounts payable
|
$ | 144,060 | $ | 35,192 | ||||
Accrued expenses
|
87,559 | 28,032 | ||||||
Accrued salary - officer
|
142,390 | 142,608 | ||||||
Note payable - director
|
121,070 | 50,000 | ||||||
Convertible notes payable
|
135,221 | - | ||||||
Promissory notes payable
|
55,770 | - | ||||||
Senior convertible notes, net of unamortized discount
|
124,999 | 56,249 | ||||||
Warrant liabilities
|
138,147 | - | ||||||
Capital lease obligation, net of unamortized discount
|
63,564 | - | ||||||
Total current liabilities
|
1,012,780 | 312,081 | ||||||
Noncurrent liabilities:
|
||||||||
Capital Lease obligation net of unamortized discount
|
172,753 | - | ||||||
Liability for contingent consideration
|
212,048 | - | ||||||
Deferred tax liability
|
164,920 | - | ||||||
Warrant liabilities
|
203,213 | 214,609 | ||||||
Total noncurrent liabilities
|
752,934 | 214,609 | ||||||
Commitments and contingencies (Note 9)
|
- | - | ||||||
Stockholders' deficiency:
|
||||||||
Common stock, $.001 par value, 600,000,000 shares
|
||||||||
authorized, 7,913,528 shares issued and outstanding
|
||||||||
(2,446,276 - 2013)
|
7,914 | 2,446 | ||||||
Additional paid-in capital
|
2,127,166 | 1,442,729 | ||||||
Accumulated deficit
|
(2,364,638 | ) | (1,774,262 | ) | ||||
Total stockholders' deficiency
|
(229,558 | ) | (329,087 | ) | ||||
Total liabilities and stockholders' deficiency
|
$ | 1,536,156 | $ | 197,603 |
For the Three Months Ended
|
||||||||
March 31, 2014
|
March 31, 2013
|
|||||||
Revenue
|
$ | 33,628 | $ | - | ||||
Cost of revenue
|
41,710 | - | ||||||
Gross loss
|
(8,082 | ) | - | |||||
Operating expenses:
|
||||||||
Selling
|
63,232 | - | ||||||
General and administrative
|
433,685 | 75,876 | ||||||
496,917 | 75,876 | |||||||
Operating loss
|
(504,999 | ) | (75,876 | ) | ||||
Other expenses:
|
||||||||
Gain on the fair market value of warrant liabilities
|
38,687 | - | ||||||
Amortization of debt discount and deferred financing costs
|
(103,779 | ) | - | |||||
Interest expense
|
(20,285 | ) | (10,562 | ) | ||||
(85,377 | ) | (10,562 | ) | |||||
Loss from continuing operations
|
(590,376 | ) | (86,438 | ) | ||||
Discontinued operations:
|
||||||||
Gain from disposal of discontinued operations
|
- | 3,839 | ||||||
Net income from discontinued operations
|
- | 19,174 | ||||||
Income from discontinued operations
|
- | 23,013 | ||||||
Net loss
|
$ | (590,376 | ) | $ | (63,425 | ) | ||
Net loss from continuing operations per share- basic and diluted
|
$ | (0.08 | ) | $ | (0.68 | ) | ||
Net income from discontinued operations per share- basic and diluted
|
0.00 | 0.18 | ||||||
Net loss per share - basic and diluted
|
$ | (0.08 | ) | $ | (0.50 | ) | ||
Weighted average common shares
|
||||||||
outstanding - basic and diluted
|
7,351,933 | 127,675 |
For the Three Months Ended
|
||||||||
March 31, 2014
|
March 31, 2013
|
|||||||
Cash flows from operating activities:
|
||||||||
Net loss
|
$ | (590,376 | ) | $ | (63,425 | ) | ||
(Income) loss from discontinued operations
|
- | (23,013 | ) | |||||
Adjustments to reconcile net loss to net cash used by operating activities:
|
||||||||
Stock based compensation
|
57,091 | 5,949 | ||||||
Common shares issued for advisor fees
|
189,575 | - | ||||||
Warrants issued for advisor fees
|
23,000 | - | ||||||
Depreciation
|
7,918 | - | ||||||
Amortization of intangible assets
|
21,700 | - | ||||||
Amortization of debt discount and deferred financing costs
|
103,780 | - | ||||||
Gain on fair market value of warrant liabilities
|
(38,687 | ) | - | |||||
Conversion of accrued interest to common stock
|
500 | - | ||||||
(Increase) decrease in assets:
|
||||||||
Accounts receivable
|
(1,385 | ) | - | |||||
Inventory
|
(439 | ) | - | |||||
Prepaid expenses and other assets
|
825 | (407 | ) | |||||
Increase (decrease) in liabilities:
|
||||||||
Accounts payable and accrued expenses
|
73,412 | 38,121 | ||||||
Accrued salary - officer
|
(218 | ) | - | |||||
Net cash used by continuing operations
|
(153,304 | ) | (42,775 | ) | ||||
Net cash provided by discontinued operations
|
- | 7,653 | ||||||
Net cash used by operating activities
|
(153,304 | ) | (35,122 | ) | ||||
Cash flows from investing activities:
|
||||||||
Purchase of property and equipment
|
(3,110 | ) | ||||||
Net proceeds from sale of LegalStore.com
|
- | 74,000 | ||||||
Acquisition of business | 11,130 | - | ||||||
Net cash used by investing activities
|
8,020 | 74,000 | ||||||
Cash flows from financing activities:
|
||||||||
Proceeds from exercise of common stock warrants
|
13,600 | - | ||||||
Proceeds from senior convertible notes, net of financing costs
|
87,000 | - | ||||||
Proceeds from convertible note
|
50,000 | - | ||||||
Principal payments on promissory notes
|
(2,037 | ) | - | |||||
Net cash provided by financing activities
|
148,563 | - | ||||||
Net increase in cash
|
3,279 | 38,878 | ||||||
Cash - beginning of period
|
14,620 | 1,262 | ||||||
Cash - end of period
|
$ | 17,899 | $ | 40,140 | ||||
Cash paid for :
|
||||||||
Income taxes
|
$ | - | $ | 600 | ||||
Non-cash investing and financing activities:
|
||||||||
Note payable and accrued interest converted to shares of common stock
|
$ | - | $ | 13,983 | ||||
Acquisition of U-Vend for issuance of shares and effective settlement of inter-company
|
$ | 808,349 | $ | - | ||||
Debt discount related to warrant liability and beneficial conversion feature | $ | 132,547 | $ | - | ||||
Property and equipment financed by capital leases | $ | 98,117 | $ | - | ||||
Issuance of promissory notes offsetting accrued expenses | $ | 57,807 | $ | - |
·
|
Level 1, defined as observable inputs such as quoted prices for identical instruments in active markets;
|
·
|
Level 2, defined as inputs other than quoted prices in active markets that are either directly or indirectly observable such as quoted prices for similar instruments in active markets or quoted prices for identical or similar instruments in markets that are not active; and
|
·
|
Level 3, defined as unobservable inputs in which little or no market data exists, therefore requiring an entity to develop its own assumptions, such as valuations derived from valuation techniques in which one or more significant inputs or significant value drivers are unobservable.
|
Consideration:
|
||||
Fair value of 3,500,000 shares of IMS common stock
issued at $0.14 on January 7, 2014
|
$ | 490,000 | ||
Fair value of 4,522,850 shares of IMS common stock measured at
$0.14, discounted for the probability of achievement
|
246,568 | |||
736,568 | ||||
Discount for restrictions
|
(103,118 | ) | ||
Effective settlement of intercompany payable due to IMS
|
174,899 | |||
Total estimated purchase price
|
$ | 808,349 |
Cash
|
$ | 11,132 | ||
Inventory
|
15,253 | |||
Prepaid expense
|
350 | |||
Property and equipment
|
232,835 | |||
Security deposits
|
6,631 | |||
Intangible assets- Operating Agreement
|
434,000 | |||
Goodwill
|
732,260 | |||
Accounts payable and accrued expenses
|
(135,634 | ) | ||
Notes payable
|
(170,517 | ) | ||
Capital lease obligations
|
(153,041 | ) | ||
Deferred tax liability
|
(164,920 | ) | ||
Total purchase price
|
$ | 808,349 |
Unaudited Pro Forma Results
|
For the quarter ended March 31, 2014
|
|||
Revenues
|
$ | 33,628 | ||
Gross loss
|
8,082 | |||
Net loss
|
(590,376 | ) | ||
Basic and fully diluted loss per share
|
(0.08 | ) |
2014
|
$
|
86,869
|
||
2015
|
85,801
|
|||
2016
|
79,226
|
|||
2017
|
5,506
|
|||
Total minimum lease payments
|
257,402
|
|||
Guaranteed residual value
|
130,185
|
|||
387,587
|
||||
Less: Amount represented interest
|
(93,240
|
)
|
||
Present value of minimum lease payments and guaranteed residual value
|
294,347
|
|||
Less: Current portion of capital lease obligations
|
(63,564
|
)
|
||
Long term capital lease obligations and guaranteed residual value
|
230,783
|
|||
Less: Unamortized debt discount on capital leases
|
(58,030
|
)
|
||
Long term capital lease obligations and guaranteed residual value, net
|
$
|
172,753
|
Shares Outstanding
|
Common Stock
|
Additional Paid-in Capital
|
Accumulated Deficit
|
Total Stockholders’ Deficit
|
||||||||||||||||
Balance at December 31, 2013
|
2,446,276 | $ | 2,446 | $ | 1,442,729 | $ | (1,774,262 | ) | $ | (329,087 | ) | |||||||||
Stock based compensation
|
389,520 | 390 | 56,701 | - | 57,091 | |||||||||||||||
Common shares issued for advisor fees
|
1,354,111 | 1,354 | 188,221 | - | 189,575 | |||||||||||||||
Shares issued in satisfaction of accrued interest
|
8,621 | 9 | 491 | - | 500 | |||||||||||||||
Warrants exercised
|
215,000 | 215 | 13,385 | - | 13,600 | |||||||||||||||
Debt discount related to beneficial conversion feature
|
- | - | 7,739 | - | 7,739 | |||||||||||||||
Shares issued in acquisition of U-Vend
|
3,500,000 | 3,500 | 417,900 | - | 421,400 | |||||||||||||||
Net loss
|
- | - | - | (590,376 | ) | (590,376 | ) | |||||||||||||
Balance at March 31, 2014
|
7,913,528 | $ | 7,914 | $ | 2,127,166 | $ | (2,364,638 | ) | $ | (229,558 | ) |
Exercise
|
|||||||||
Warrants
|
Price
|
Expiration
|
|||||||
2011 Common share private placement warrants
|
12,500
|
$
|
60.00
|
March 2018
|
|||||
2011 Convertible notes warrants
|
83
|
$
|
60.00
|
June 2014
|
|||||
2012 Private placements warrants
|
750
|
$
|
30.00
|
March - April 2015
|
|||||
2013 Series A warrants Senior Convertible Notes
|
1,125,000
|
$
|
0.20
|
October-November 2014
|
|||||
2013 Series A warrants Senior Convertible Notes
|
1,500,000
|
$
|
0.05
|
January 2014 - March 2015
|
|||||
2013 Series B warrants Senior Convertible Notes
|
1,125,000
|
$
|
0.24
|
June-August 2018
|
|||||
2013 Series B warrants Senior Convertible Notes
|
1,500,000
|
$
|
0.06
|
October - December 2018
|
|||||
2013 Lease obligation warrants
|
986,250
|
$
|
1.20
|
November 2016
|
|||||
2014 Warrants for services
|
920,000
|
$
|
0.05
|
July 2015
|
|||||
2014 Warrants for services
|
1,120,000
|
$
|
0.05
|
January 2019
|
|||||
2014 Warrants for services
|
35,000
|
$
|
0.24
|
January 2016
|
|||||
2014 Warrants for services
|
18,480
|
$
|
0.01
|
January 2016
|
|||||
2014 Series A warrants Senior Convertible Notes
|
3,000,000
|
$
|
0.05
|
April 2015- June 2015
|
|||||
2014 Series B warrants Senior Convertible Notes
|
3,000,000
|
$
|
0.06
|
January 2019- March 2019
|
|||||
2014 Lease obligation warrants
|
246,563
|
$
|
0.20
|
March 2017
|
Net cash proceeds after brokerage fee of $21,000
|
$
|
74,000
|
||
LegalStore.com liabilities assumed
|
136,241
|
|||
Total purchase price
|
210,241
|
|||
LegalStore.com assets
|
206,402
|
|||
Gain on sale
|
$
|
3,839
|
2014
|
$
|
31,007
|
||
2015
|
29,095
|
|||
2016
|
29,516
|
|||
2017
|
28,602
|
|||
2018
|
22,325
|
|||
2019
|
8,280
|
|||
$
|
148,825
|
As of
|
||||||||
June 30,
|
December 31,
|
|||||||
2014
|
2013
|
|||||||
(Unaudited)
|
||||||||
ASSETS
|
||||||||
Current assets:
|
||||||||
Cash
|
$ | 31,366 | $ | 14,620 | ||||
Inventory (net)
|
23,279 | - | ||||||
Prepaid expenses and other assets
|
2,211 | 4,114 | ||||||
Receivable from U-Vend, Canada, Inc.
|
- | 162,536 | ||||||
Total current assets
|
56,856 | 181,270 | ||||||
Noncurrent assets:
|
||||||||
Property and equipment (net)
|
485,312 | - | ||||||
Security deposits
|
6,631 | - | ||||||
Deferred financing costs (net)
|
13,492 | 16,333 | ||||||
Intangible asset (net)
|
390,601 | - | ||||||
Goodwill
|
732,260 | - | ||||||
Total noncurrent assets
|
1,628,296 | 16,333 | ||||||
Total assets
|
$ | 1,685,152 | $ | 197,603 | ||||
LIABILITIES AND STOCKHOLDERS' DEFICIENCY
|
||||||||
Current liabilities:
|
||||||||
Accounts payable
|
$ | 124,924 | $ | 35,192 | ||||
Accrued expenses
|
108,938 | 28,032 | ||||||
Accrued interest
|
51,271 | - | ||||||
Amounts due to officers
|
209,311 | 142,608 | ||||||
Note payable - director, net of discount
|
139,402 | 50,000 | ||||||
Convertible notes payable, net of discount
|
142,847 | - | ||||||
Promissory notes payable
|
63,411 | - | ||||||
Senior convertible notes, net of discount
|
123,035 | 56,249 | ||||||
Current capital lease obligation
|
92,117 | - | ||||||
Total current liabilities
|
1,055,256 | 312,081 | ||||||
Noncurrent liabilities:
|
||||||||
Capital lease obligation, net of discount
|
306,653 | - | ||||||
Liability for contingent consideration
|
212,048 | - | ||||||
Deferred tax liability
|
164,920 | - | ||||||
Warrant liabilities
|
660,298 | 214,609 | ||||||
Total noncurrent liabilities
|
1,343,919 | 214,609 | ||||||
Total liabilities
|
2,399,175 | 526,690 | ||||||
Commitments and contingencies (Note 10)
|
- | - | ||||||
Stockholders' deficiency:
|
||||||||
Common stock, $.001 par value, 600,000,000 shares
|
||||||||
authorized, 8,346,076 shares issued and outstanding
|
||||||||
(2,446,276 - 2013)
|
8,346 | 2,446 | ||||||
Additional paid-in capital
|
2,217,383 | 1,442,729 | ||||||
Accumulated deficit
|
(2,939,752 | ) | (1,774,262 | ) | ||||
Total stockholders' deficiency
|
(714,023 | ) | (329,087 | ) | ||||
Total liabilities and stockholders' deficiency
|
$ | 1,685,152 | $ | 197,603 |
For the Three Months Ended
|
For the Six Months Ended
|
|||||||||||||||
June 30, 2014
|
June 30, 2013
|
June 30, 2014
|
June 30, 2013
|
|||||||||||||
Revenue
|
$ | 62,008 | $ | - | $ | 95,636 | $ | - | ||||||||
Cost of revenue
|
33,971 | - | 53,981 | - | ||||||||||||
Gross profit
|
28,037 | - | 41,655 | - | ||||||||||||
Operating expenses:
|
||||||||||||||||
Selling
|
104,392 | - | 189,324 | - | ||||||||||||
General and administrative
|
128,663 | 103,115 | 562,348 | 178,991 | ||||||||||||
233,055 | 103,115 | 751,672 | 178,991 | |||||||||||||
Operating loss
|
(205,018 | ) | (103,115 | ) | (710,017 | ) | (178,991 | ) | ||||||||
Other expenses:
|
||||||||||||||||
Loss on the fair market value of warrant liabilities
|
316,361 | - | 277,674 | - | ||||||||||||
Amortization of debt discount and deferred financing costs
|
131,302 | - | 235,081 | - | ||||||||||||
(Gain) on extinguishment of debt
|
(111,716 | ) | - | (111,716 | ) | - | ||||||||||
Interest expense
|
34,149 | 9,631 | 54,434 | 20,193 | ||||||||||||
370,096 | 9,631 | 455,473 | 20,193 | |||||||||||||
Loss from continuing operations
|
(575,114 | ) | (112,746 | ) | (1,165,490 | ) | (199,184 | ) | ||||||||
Discontinued operations:
|
||||||||||||||||
Gain from disposal of discontinued operations
|
- | - | - | 3,839 | ||||||||||||
Net income from discontinued operations
|
- | - | - | 19,174 | ||||||||||||
Income from discontinued operations
|
- | - | - | 23,013 | ||||||||||||
Net loss
|
$ | (575,114 | ) | $ | (112,746 | ) | $ | (1,165,490 | ) | $ | (176,171 | ) | ||||
Net loss from continuing operations per share- basic and diluted
|
$ | (0.07 | ) | $ | (0.67 | ) | $ | (0.15 | ) | $ | (1.34 | ) | ||||
Net income from discontinued operations per share- basic and diluted
|
- | - | - | 0.15 | ||||||||||||
Net loss per share - basic and diluted
|
$ | (0.07 | ) | $ | (0.67 | ) | $ | (0.15 | ) | $ | (1.19 | ) | ||||
Weighted average common shares
|
||||||||||||||||
outstanding - basic and diluted
|
7,989,722 | 169,353 | 7,672,590 | 148,597 |
For the Six Months Ended
|
||||||||
June 30, 2014
|
June 30, 2013
|
|||||||
Cash flows from operating activities:
|
||||||||
Net loss
|
$ | (1,165,490 | ) | $ | (176,171 | ) | ||
(Income) from discontinued operations
|
- | (23,013 | ) | |||||
Adjustments to reconcile net loss to net cash used by operating activities:
|
||||||||
Gain on extinguishment of debt
|
(111,716 | ) | - | |||||
Stock based compensation
|
62,110 | 11,798 | ||||||
Common shares issued for advisor fees
|
189,575 | - | ||||||
Warrants issued for advisor fees
|
23,000 | - | ||||||
Depreciation
|
22,205 | - | ||||||
Amortization of intangible assets
|
43,399 | - | ||||||
Amortization of debt discount and deferred financing costs
|
235,081 | - | ||||||
Common shares issued to satisfy loan from lessor
|
10,000 | - | ||||||
Loss on fair market value of warrant liabilities
|
277,674 | - | ||||||
Conversion of accrued interest and debt to common stock
|
500 | - | ||||||
(Increase) decrease in assets:
|
||||||||
Inventory
|
(8,026 | ) | - | |||||
Prepaid expenses and other assets
|
2,251 | (9,713 | ) | |||||
Increase in liabilities:
|
||||||||
Accounts payable and accrued expenses
|
149,015 | 101,021 | ||||||
Amount due to officers
|
54,340 | - | ||||||
Net cash used by continuing operations
|
(216,082 | ) | (96,078 | ) | ||||
Net cash provided by discontinued operations
|
- | 7,653 | ||||||
Net cash used by operating activities
|
(216,082 | ) | (88,425 | ) | ||||
Cash flows from investing activities:
|
||||||||
Purchase of property and equipment
|
(3,110 | ) | - | |||||
Net proceeds from sale of LegalStore.com
|
- | 74,000 | ||||||
Acquisition of business
|
11,132 | - | ||||||
Net cash provided by investing activities
|
8,022 | 74,000 | ||||||
Cash flows from financing activities:
|
||||||||
Proceeds from exercise of common stock warrants
|
23,660 | - | ||||||
Proceeds from senior convertible notes, net of deferred financing costs
|
143,900 | - | ||||||
Proceeds from note payable director
|
50,000 | - | ||||||
Issuance of promissory note
|
10,000 | - | ||||||
Principal payments on promissory notes
|
(2,754 | ) | - | |||||
Net repayments from related party
|
- | (13,827 | ) | |||||
Advance on bridge financing, net
|
- | 43,500 | ||||||
Net cash provided by financing activities
|
224,806 | 29,673 | ||||||
Net increase in cash
|
16,746 | 15,248 | ||||||
Cash - beginning of period
|
14,620 | 1,262 | ||||||
Cash - end of period
|
$ | 31,366 | $ | 16,510 | ||||
Cash paid for :
|
||||||||
Income taxes
|
$ | - | $ | 2,200 | ||||
Interest
|
$ | 6,958 | $ | - | ||||
Non-cash investing and financing activities:
|
||||||||
Note payable and accrued interest converted to shares of common stock
|
$ | - | $ | 95,768 | ||||
Acquisition of U-Vend Canada for issuance of shares and effective settlement of inter-company
|
$ | 808,349 | $ | - | ||||
Debt discount related to warrant liability and beneficial conversion feature
|
$ | 341,947 | $ | - | ||||
Property and equipment financed by capital leases
|
$ | 271,572 | $ | - | ||||
Issuance of promissory notes offsetting accrued expenses
|
$ | 57,807 | $ | - | ||||
Issuance of common shares to satisfy capital lease obligation
|
$ | 23,923 | $ | - |
·
|
Level 1, defined as observable inputs such as quoted prices for identical instruments in active markets;
|
·
|
Level 2, defined as inputs other than quoted prices in active markets that are either directly or indirectly observable such as quoted prices for similar instruments in active markets or quoted prices for identical or similar instruments in markets that are not active; and
|
·
|
Level 3, defined as unobservable inputs in which little or no market data exists, therefore requiring an entity to develop its own assumptions, such as valuations derived from valuation techniques in which one or more significant inputs or significant value drivers are unobservable.
|
Consideration:
|
||||
Fair value of 3,500,000 shares of common stock
issued at $0.14 on January 7, 2014
|
$
|
490,000
|
||
Fair value of 4,522,850 shares of common stock measured at
$0.14, discounted for the probability of achievement
|
246,568
|
|||
736,568
|
||||
Discount for restrictions
|
(103,118
|
)
|
||
Effective settlement of intercompany payable due to U-Vend, Inc.
|
174,899
|
|||
Total estimated purchase price
|
$
|
808,349
|
Cash
|
$
|
11,132
|
||
Inventory
|
15,253
|
|||
Prepaid expense
|
350
|
|||
Property and equipment
|
232,835
|
|||
Security deposits
|
6,631
|
|||
Intangible assets- Operating Agreement
|
434,000
|
|||
Goodwill
|
732,260
|
|||
Accounts payable and accrued expenses
|
(135,634
|
)
|
||
Notes payable
|
(170,517
|
)
|
||
Capital lease obligations
|
(153,041
|
)
|
||
Deferred tax liability
|
(164,920
|
)
|
||
Total purchase price
|
$
|
808,349
|
2014
|
$
|
103,329
|
||
2015
|
136,354
|
|||
2016
|
129,779
|
|||
2017
|
30,782
|
|||
Total minimum lease payments
|
400,244
|
|||
Guaranteed residual value
|
206,833
|
|||
607,077
|
||||
Less: Amount represented interest
|
(153,038
|
)
|
||
Present value of minimum lease payments and guaranteed residual value
|
454,039
|
|||
Less: Current portion of capital lease obligations
|
(92,117
|
)
|
||
Long term capital lease obligations and guaranteed residual value
|
361,922
|
|||
Less: Unamortized debt discount on capital leases
|
(55,269
|
)
|
||
Long term capital lease obligations and guaranteed residual value, net
|
$
|
306,653
|
Shares Outstanding
|
Common Stock
|
Additional Paid-in Capital
|
Accumulated Deficit
|
Total Stockholders’ Deficit
|
||||||||||||||||
Balance at December 31, 2013
|
2,446,276
|
$
|
2,446
|
$
|
1,442,729
|
$
|
(1,774,262)
|
$
|
(329,087)
|
|||||||||||
Stock based compensation
|
389,520
|
389
|
61,721
|
-
|
62,110
|
|||||||||||||||
Common shares issued for advisor fees
|
1,354,111
|
1,354
|
188,221
|
-
|
189,575
|
|||||||||||||||
Shares issued in satisfaction of accrued interest
|
8,621
|
9
|
491
|
-
|
500
|
|||||||||||||||
Common shares issued for services
|
41,667
|
42
|
9,958
|
-
|
10,000
|
|||||||||||||||
Common shares issued for capital lease debt
|
208,881
|
209
|
33,896
|
-
|
34,105
|
|||||||||||||||
Warrants exercised
|
397,000
|
397
|
23,263
|
-
|
23,660
|
|||||||||||||||
Debt discount related to beneficial conversion
|
-
|
-
|
54,424
|
-
|
54,424
|
|||||||||||||||
Warrant liability reclassified to equity as a result of reverse stock split – adequate authorized shares available
|
-
|
-
|
52,833
|
-
|
52,833
|
|||||||||||||||
Warrants granted for debt obligations
|
-
|
-
|
21,947
|
-
|
21,947
|
|||||||||||||||
Repurchase of beneficial conversion feature in connection with debt extinguishment
|
-
|
-
|
(90,000)
|
-
|
(90,000)
|
|||||||||||||||
Shares issued in acquisition of U-Vend Canada
|
3,500,000
|
3,500
|
417,900
|
-
|
421,400
|
|||||||||||||||
Net loss
|
-
|
-
|
-
|
(1,165,490)
|
(1,165,490)
|
|||||||||||||||
Balance at June 30, 2014
|
8,346,076
|
$
|
8,346
|
$
|
2,217,383
|
$
|
(2,939,752)
|
$
|
(714,023)
|
Exercise
|
|||||||||
Warrants
|
Price
|
Expiration
|
|||||||
Warrants acquired in U-Vend merger 1/7/14
|
1,750,669
|
$
|
0.24
|
September 2015 – December 2016
|
|||||
2011 Common share private placement warrants
|
12,500
|
$
|
60.00
|
March 2018
|
|||||
2012 Private placements warrants
|
750
|
$
|
30.00
|
March - April 2015
|
|||||
2013 Series A warrants Senior Convertible Notes
|
6,000,000
|
$
|
0.05
|
June - December 2015
|
|||||
2013 Series B warrants Senior Convertible Notes
|
6,000,000
|
$
|
0.06
|
June - December 2018
|
|||||
2013 Lease obligation warrants
|
986,250
|
$
|
0.20
|
November 2016
|
|||||
2014 Warrants for services
|
834,000
|
$
|
0.05
|
July 2015
|
|||||
2014 Warrants for services
|
1,024,000
|
$
|
0.06
|
January 2019
|
|||||
2014 Warrants for services
|
35,000
|
$
|
0.24
|
January 2016
|
|||||
2014 Warrants for services
|
18,480
|
$
|
0.01
|
January 2016
|
|||||
2014 Series A warrants Senior Convertible Notes
|
5,100,000
|
$
|
0.05
|
January 2016- June 2016
|
|||||
2014 Series B warrants Senior Convertible Notes
|
5,100,000
|
$
|
0.06
|
January 2019- June 2019
|
|||||
2014 Lease obligation warrants
|
246,563
|
$
|
0.20
|
March 2017
|
|||||
2014 Lease obligation warrants
|
483,889
|
$
|
0.18
|
May 2017
|
|||||
2014 Issued with Promissory Note
|
41,667
|
$
|
0.24
|
May 2016
|
|||||
2014 Issued with Note Payable - Director Warrants | 208,333 | $ | 0.24 | February 2017 |
Balance at January 1, 2014
|
$
|
214,609
|
||
Allocation of proceeds related to senior convertible
notes as derivative liabilities due to “down-round provision”
|
255,936
|
|||
Extinguishment of June 18, 2013, August 21, 2013 and
October 17, 2013 senior convertible notes
|
(87,921)
|
|||
Warrants classified as derivative liabilities due to
inadequate shares authorized to accommodate
the exercise of all outstanding equity instruments
|
52,833
|
|||
Adjustment of warrants classified as derivative liabilities
to additional paid-in capital as a result adequate shares
authorized due to reverse stock split on May 16, 2014
|
(52,833)
|
|||
Unrealized loss on fair market value adjustment
|
277,674
|
|||
Balance at June 30, 2014
|
$
|
660,298
|
Net cash proceeds after brokerage fee of $21,000
|
$
|
74,000
|
||
LegalStore.com liabilities assumed
|
136,241
|
|||
Total purchase price
|
210,241
|
|||
LegalStore.com assets
|
206,402
|
|||
Gain on sale
|
$
|
3,839
|
2014
|
$
|
31,007
|
||
2015
|
29,095
|
|||
2016
|
29,516
|
|||
2017
|
28,602
|
|||
2018
|
22,325
|
|||
2019
|
8,280
|
|||
$
|
148,825
|
ITEM 13
.
|
OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION
|
Registration Fees
|
$
|
484
|
||
Accounting Fees and Expenses
|
10,000
|
|||
Legal Fees and Expenses
|
10,000
|
|||
Miscellaneous Fees and Expenses
|
7,500
|
|||
TOTAL
|
$
|
27
,
984
|
ITEM 14
.
|
INDEMNIFICATION OF DIRECTORS AND OFFICERS
|
ITEM 15
.
|
RECENT SALES OF UNREGISTERED SECURITIES
|
ITEM 16
.
|
EXHIBITS
|
3.1
|
Certificate of Incorporation dated March 26, 2007, as amended by Certificate of Amendment dated October 4, 2010 (incorporated by reference to the Company’s Form 8-K (file number 333-165972) filed on October 7, 2010).
|
*
|
|
||
3.2
|
By-laws, as amended (incorporated by reference to exhibit 3.2 to the Company’s Registration Statement on Form S-1 (file number 333-165972) filed on April 9, 2010).
|
*
|
5.1
|
Opinion on legality (to be filed by amendment)
|
**
|
10.1
|
Premise lease agreement dated January 13, 2010 with SC Sunrise LLC for 1434 6th. Street, Unit 9, Santa Monica, CA (incorporated by reference from Company’s Registration Statement on Form S-1 (file number 333-165972) dated April 9, 2010).
|
*
|
10.2
|
Agreements dated October 8, 2009 with Document Security Systems (incorporated by reference from Company’s Registration Statement on Form S-1/A (file number 333-165972) dated June 30, 2010).
|
*
|
10.3
|
Credit Facility Agreement, dated April 8, 2010, between the Company and Raymond Meyers (incorporated by reference from Company’s Registration Statement on Form S-1/A (file number 333-165972) dated June 30, 2010).
|
*
|
10.4
|
Security Agreement, dated April 8, 2010, between the Company and Raymond Meyers (incorporated by reference from Company’s Registration Statement on Form S-1/A (file number 333-165972) dated June 30, 2010).
|
*
|
10.5
|
Secured Promissory Note, dated April 8, 2010, between the Company and Raymond Meyers (incorporated by reference from Company’s Registration Statement on Form S-1/A (file number 333-165972) dated June 30, 2010).
|
*
|
10.6
|
Secured Promissory Note 2, dated June 30, 2010, between the Company and Raymond Meyers (incorporated by reference from Company’s Registration Statement on Form S-1/A (file number 333-165972) dated July 26, 2010).
|
*
|
10.7
|
Form of Warrant to Purchase Common Stock of Internet Media Services, Inc. dated March 17, 2011 (file number 333-165972).
|
*
|
10.8
|
Securities Purchase Agreement by and between Internet Media Services, Inc. and Asher Enterprises, Inc. dated August 26, 2011 (file number 333-165972, filed September 8, 2011).
|
*
|
10.9
|
Securities Purchase Agreement by and between Internet Media Services, Inc. and Asher Enterprises, Inc. dated October 3, 2011 (file number 333-165972, filed October 17, 2011).
|
*
|
10.10
|
Securities Purchase Agreement by and between Internet Media Services, Inc. and Asher Enterprises, Inc dated December 1, 2011 (file number 333-165972, filed December 16, 2011).
|
*
|
10.11
|
Asset Purchase Agreement by and between Internet Media Services, Inc. and Enthusiast Media holdings, Inc. dated March 7, 2012 (file number 333-165972, filed March 13, 2012).
|
*
|
10.12
|
Form of Internet Media Services, Inc. 2011 Equity Incentive Plan dated July 26, 2011 (file number 333-165972, filed July 27, 2011).
|
*
|
10.13
|
Stock Purchase Agreement by and among Western Principal Partners LLC, Internet Media Services, Inc and Raymond Meyers dated March 8, 2013 (file number 333-165972, filed March 19, 2013).
|
*
|
ITEM 17.
|
UNDERTAKINGS
|
U-VEND, INC.
|
||
By:
|
/s/ Raymond Meyers
|
|
Raymond Meyers, Chief Executive Officer
|
||
(Principal Executive Officer)
|
||
Signatures
|
Title(s)
|
Date
|
|||
By:
|
/s/ Raymond Meyers
|
Chief Executive Officer
|
October 1, 2014
|
||
Raymond Meyers
|
(Principal Executive Officer)
|
||||
By:
|
/s/ Paul Neelin
|
Chief Operating Officer, Secretary, and Director
|
October 1, 2014
|
||
Paul Neelin
|
|||||
By:
|
/s/ Kathleen Browne
|
Chief Financial Officer
|
October 1, 2014
|
||
Kathleen Browne
|
|
||||
By:
|
/s/ Philip Jones
|
Director
|
October 1, 2014
|
||
Philip Jones
|
|||||
By:
|
/s/ Alexander Orlando
|
Director
|
October 1, 2014
|
||
Alexander Orlando
|
|||||
By:
|
/s/ Patrick White
|
Director
|
October 1, 2014
|
||
Patrick White
|
|||||
(i)
|
If to the Lender:
|
Automated Retail Leasing Partners, LP
|
|
110 East 40
th
Street, Suite 802
|
|
New York, NY 10016
|
|
(ii)
|
If to Company:
|
U-Vend, Inc.
|
|
1507 7
th
Street, Unit 425
|
|
Santa Monica, CA 90401
|
U-VEND, INC.
|
|
By:
/s/ Raymond Meyers
|
|
Name: Raymond Meyers
|
|
Title: President
|