ITEM 1. BUSINESS.
Corporate History
Team 360 Sports, Inc. formerly, TSI Sports Inc., was incorporated in the State of Nevada on February 26, 2013, and amended its name to TEAM 360 SPORTS INC., (“Team 360 Sports”) on April 4, 2016 with the State of Nevada. TSI Sports Inc was formed for the purpose of developing software to facilitate sports team management.
The Company has its Nevada registered office at 711 S. Carson Street, Suite 4, Carson City, Nevada 89701. The Company’s main phone number is 775-882-4641. Its principal operations are conducted from its office at 163 Killian Rd., Maple, Ontario L6A 1A8. We are located on the Internet at www.team360apps.com.
Business
The Amateur sports market is a multi-billion dollar industry. We plan to address the need to make life easier and save time of amateur sports administrators and coaches by providing easy to use app for them to manage their team mobile web app service to coaches and sports.
Team 360 Sports is planning to fulfill the need for time saving team management app for today’s busy sports volunteer to help them better organize, coach and administer a team.
Developing easy to use web and mobile applications with powerful time saving tools. In amateur sports, volunteers are coaches and administrators who make up the backbone of the organization. The biggest challenge facing them is the time commitment required to do their job effectively while maintaining regular jobs, family and kids. Our goal is to help coaches and managers effectively administer their teams and save time doing it by providing easy to use tools.
Leverage off managements' experience. The Team 360 Sports management has been involved in the past with sports administrative services and were the founders of a company that sold its primary asset in 2016, which was software somewhat similar to the software being produced by the Company in 2016. Its customers were some of the largest leagues and clubs in North America representing over 300,000 players. See the biography of Mr. Miklos on page 18.
Maximizing profits by selling services online. The Company plans to make the entire sales funnel automated and online therefore maximizing profit margins.
Maintaining low overhead costs. The Company plans to outsource certain front end design, and coding/programming services overseen by the company CTO. An offshore call center will be used for customer service.
Effective Marketing. We have an outstanding product and to "tell" the amateur sports world about it we will utilize, print, media, content, and online marketing.
E web and mobile applications with powerful time saving tools. In amateur sports, volunteers are coaches and administrators who make up the backbone of the organization. The biggest challenge facing them is the time commitments required to do their job effectively while maintaining regular jobs, family and kids. Our goal is to help coaches and managers effectively administer their teams and save time doing it by providing easy to use tools.
Team 360 Sports has its Nevada registered office in Carson City Nevada and operates its administrative office in Ontario, Canada. The company addresses a unique need in the Sports Industry that has over 60 million players and revenues in excess of $400 billion dollars.
Team 360 Sports offers several proven solutions for the Sports Industry:
Team360Apps
The Company’s app is located at www.team360apps.com.
The Company has a customized mobile website to manage teams. (Web, Native IOS and Android app). Available as "freemium" with limited functions or as a pay account. The full features include: drag and drop templates for customized team mobile website; Blog section for team specific content; Communications function to custom or auto notify participants by email or text of events, practice and game schedules and track who will or will not be attending; Schedule practices, games and events; Collect dues and fees and track who paid and who did not.
The software features include an auto prompt that is delivered by email or text to those who have not paid. The customer (typically a team) is charged a monthly recurring fee of $4.99. Another feature is Team mobile website builder which is designed to provide an easy and quick means to create and maintain a mobile team website and integrate with a league, club or federation (if the league using Team360Clubs software). A team coach, administrator or manager signs up by quickly and easily by providing an email address or an existing social media account. The software allows the team to use a team logo and photos upload (the freemium version limits the number of photos); and provides space for a description and history of the team and using 40 different drag and drop templates to create a Team mobile website (the freemium version allows only one set template. Players may provide additional information. (Contact details, photos, videos) and may provide their own unique content and blog.
Activities are easily scheduled, players auto notified via text or email. Confirmation of attendance is sent back to administrator who then sets a roster for practice or a game.
The team site may be integrated with each member’s social media to allow for a wider audience and fan base.
A fundraising campaign option is available for teams to make use of the company's crowdfunding platform. A fundraising campaign is initiated and managed by the administrator. The platform leverages the team's social media to help them achieve their goal.
The cost of the packages is:
Freemium Version. No cost
Full Coaching Package $4.99 per month.
Crowdfunding Add On $9.99 per month and 5% of funds raised.
The primary app for Team 360 Sports Inc. is Team 360 apps.
Team360Funding
The Team 360 Funding part of the app may be used in web format, Native IOS and Android app format. Social media is integrated into the Team crowdfunding platform. A registered user of any of the Company's products automatically gets a Team crowdfunding profile. The account may be activated at any time to launch a donation or reward based crowdfunding campaign and leverage social media contacts of the team. The platform will keep track of funds raised, from whom, what and when the reward was shipped, keep the whole process compliant with regulations. For use of the Team360Funding feature, the Company charges a recurring monthly fee of $9.99 and 5 % of the funds raised. This software is in development and is not operational at this time.
Team360Clubs. The Team360Clubs software provides an online suite of professional tools for managers of sports leagues and clubs to effectively administer their organizations consisting of hundreds of teams and thousands of players. The App features include: Coaches, Certification maintenance, training, scheduling and pay; Players. Signup, team roster referees, schedules, tournaments. It functions in web format, Native IOS and Android app. This software is in development and is not operational at this time.
Overview
Amateur sports teams are typically coached, administered, and managed by volunteers with day jobs, families, and busy lives. As such they lack time and resources to effectively manage their teams. The Company provides an easy to use time saving web and native apps to help coach or administrator effectively manage the team. A coach or administrator can easily create a mobile team website, upload team logo, photos, and videos to customize it using drag and drop templates, collect fees, schedule games and events, auto notify all participants, keep track of who is attending and communicate with team members.
Another big challenge for amateur sports organizations is fundraising. The Company provides a donation and rewards based "crowdfunding" portal help to raise money for trips, equipment and uniforms by leveraging and utilizing participants’ social media connections.
The founders of the Company have over 35 years experience with team coaching and sports management software administration and development.
Team 360 Sports Inc is Nevada Corporation. Sandor Miklos is the Chief Executive Officer and he and Mario Discepola own the majority of the Company. We are located on the Internet at www.team360apps.com.
See Mr. Miklos' biography for more details at pages 18.
Customers, Distribution and Marketing
The world of amateur athletics goes far beyond the confines of high school and collegiate sports and is changing rapidly in size and demographics. Amateur athletics and their corresponding leagues create industries which not only continue to increase membership, but generate billions of dollars in revenues in the U.S. and Canada. While the amateur segment is fragmented at the commercial level, youth athletics alone (including all sports) represents an industry that generates an estimated $5 billion (in the U.S.) in annual revenues and provides services to an estimated 44 million youth between the ages of 6 and 17 annually.[1]
Adults in the U.S. spend more than $100 billion on recreational sports and sports-related sectors each year, with a large part going to league/association memberships as dues and subscriptions. There is strong potential for companies that can capitalize on underrepresented market niches including sports team management and data collection services.
Youth Sports
Source: Humphreys Ruesky Sports Industry Study
Adult Participation in Youth Sports (in millions)
Source: National Council on Youth Sports
___________________________
[1] As reported in a report by the North American Association of Sports Economists, IASE/NAASE Working Paper Series, No. 08-11. The abstract of the report states: "We estimate the economic scope of the sports industry in the United States. Drawing on a variety of data sources, we investigate the economic size of sport participation, sports viewing, and the supply and demand side of the sports market in the United States. Estimates of the size of the sports industry based on aggregate demand and aggregate supply range from $44 to $73 billion in 2005. In addition, participation in sports and the opportunity time cost of attending sporting events are important, but hard to value, components of the industry."
Estimated Adult Team Sport Participants (in millions)
Source: BRFS Survey
Numbers of Players on a Team
The Humphreys and Ruesky Sports Industry Report (2008) estimates that 50% of the US population participates in some sport regularly and a more significant number participates in a sport irregularly.
The Company's target market is US/Canadian amateur sports team market (with players of any age).
The Company plans to develop the market through social media, email, pay per click marketing and through developing a strong presence at industry tradeshows.
Marketing
Our target markets are U.S. amateur sports teams and more specifically the team coach or assistant coach. Volunteers coach most amateur sports teams. In youth sports specifically parents typically take on the coaching roles while their children play on the team. On average these volunteers come with no previous coaching experience and not a lot of excess time to devote to learning difficult to use software. They may volunteer to coach or assist the coach because they want to help out; there is no one else who will take on the role; (not necessarily for the love of the game). In adult team sports, coaches are also players.
Amateur coaches need a time saving solution as they have jobs, families, and lives.
Amateur coaches need an easy to learn and use product as they are not interested in taking on a huge learning curve.
Amateur coaches need to efficiently schedule games, venues and tournaments rather than using spreadsheets and paper based notes.
Amateur coaches need an automated and efficient way to collect dues and fees from players. Collecting money from participants consumes much time and is a major hassle.
Amateur coaches need help to fundraise for team trips and equipment. Lack of funding and difficulty in achieving fundraising goals is one of the major obstacles facing sports organizations.
The Company services the needs of the market with a robust solution that is:
Easy to learn and use
Robust and customizable
Web based or native (IOS and Android) application
Provides a crowdfunding optional package unique to the industry
Competition
The Company is engaged in the amateur sports administration market in which there are many competitors. Some competitors focus on the top of the pyramid, for example; sports federations, leagues and clubs providing data storage and manipulation for the league and club management. Other competitors focus on providing more specific services at the lower end of the pyramid to amateur sports teams. These services typically include player sign up, scheduling and communications, data collection, storage and data manipulation. The services are typically provided using downloadable native applications. There are some companies that address both markets the leagues and providing federations, leagues and clubs and teams.
The most significant competitors are Teamsnap and Sportsngn. They are both well funded organizations competing in the same marketplace. Their products are well designed and popular in the market place. However, from a user’s prospective, their services are not as easy to identify. We intend to compete by making our products easy to use and understand. Our prices and services are clearly listed on the website. They do not have to search and go through a series of hoops to find out the actual cost of our services. Our main competitors have large marketing budgets and will be difficult to compete with. Some competitors to a lesser extent are Eteamz and Sportslogic. Their product is equally concentrated on larger sports organizations leagues and clubs versus teams. These companies also provide a mix of applications that are similar to ours. They are also well capitalized with large marketing budgets and will be difficult to compete with.
Other competitors: There is a myriad of small companies that provide some or all or more of the services we provide.
Overall there is a barrier to entry to this market due to the amount of time and effort required to develop a robust software platform and design and create native applications.
Employees
As of the date of this filing, Team 360 Sports employed a total of 2 people, which include the Chief Executive Officer and the Chief Operating Officer. Team 360 Sports considers its relationship with its employees to be stable.
Facilities and Logistics
Team 360 Sports Inc is headquartered with its executive offices located in the residence of Sandor Miklos at 163 Killian Road, Maple, Ontario, Canada L6A 1A8. The Company does not have a formal lease, but expects that as it grows, it will lease offices as needed.
Involvement in Certain Legal Proceedings
The Company and none of our officer nor directors, promoters or control persons have been involved in the past ten years in any of the following:
(1) Any bankruptcy petition filed by or against any business of which such person was a general partner or executive officer either at the time of the bankruptcy or within two years prior to that time;
(2) Any conviction in a criminal proceeding or being subject to a pending criminal proceeding (excluding traffic violations and other minor offenses);
(3) Being subject to any order, judgment or decree, not subsequently reversed, suspended or vacated, or any court of competent jurisdiction, permanently or temporarily enjoining, barring, suspending or otherwise limiting his involvement in any type of business, securities or banking activities; or
(4) Being found by a court of competent jurisdiction (in a civil action), the Commission or the Commodity Futures Trading Commission to have violated a federal or state securities or commodities law, and the judgment has not been reversed, suspended, or vacated.
Patents
The Company has no current patents or trademarks.
Seasonality
We generally do not have a strong seasonality trend to our business.
ITEM 1B.
ITEM 1B. UNRESOLVED STAFF COMMENTS.
None.
ITEM 2.
ITEM 2. PROPERTIES.
None.
ITEM 3.
ITEM 3. LEGAL PROCEEDINGS.
None.
ITEM 4.
ITEM 4. MINE SAFETY DISCLOSURES.
Not applicable.
PART II
ITEM 5.
ITEM 5. MARKET FOR REGISTRANT’S COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES.
Market Information
There is no established public trading market for our securities and a regular trading market may not develop, or if developed, may not be sustained. A stockholder in all likelihood, therefore, will not be able to resell his or her securities should he or he desire to do so when eligible for public resale. Furthermore, it is unlikely that a lending institution will accept our securities as pledged collateral for loans unless a regular trading market develops. We have no plans, proposals, arrangements, or understandings with any person with regard to the development of a trading market in any of our securities.
Penny Stock Considerations
Our shares likely will be “penny stocks” as that term is generally defined in the Exchange Act and the rules and regulations promulgated thereunder to mean equity securities with a price of less than $5.00. Our shares thus will be subject to rules that impose sales practice and disclosure requirements on broker-dealers who engage in certain transactions involving a penny stock.
Under the penny stock regulations, a broker-dealer selling a penny stock to anyone other than an established customer or accredited investor must make a special suitability determination regarding the purchaser and must receive the purchaser’s written consent to the transaction prior to the sale. Generally, an individual with a net worth in excess of $1,000,000 or annual income exceeding $200,000 individually or $300,000 together with his or her spouse is considered an accredited investor. In addition, under the penny stock regulations the broker-dealer is required to:
· Deliver, prior to any transaction involving a penny stock, a disclosure schedule prepared by the SEC relating to the penny stock market, unless the broker-dealer or the transaction is otherwise exempt;
· Disclose commissions payable to the broker-dealer and our registered representatives and current bid and offer quotations for the securities;
· Send monthly statements disclosing recent price information pertaining to the penny stock held in a customer’s account, the account’s value and information regarding the limited market in penny stocks; and
· Make a special written determination that the penny stock is a suitable investment for the purchaser and receive the purchaser’s written agreement to the transaction, prior to conducting any penny stock transaction in the customer’s account.
Because of these regulations, broker-dealers may encounter difficulties in their attempt to sell shares of our Common Stock, which may affect the ability of Selling Stockholders or other holders to sell their shares in the secondary market and have the effect of reducing the level of trading activity in the secondary market. These additional sales practice and disclosure requirements could impede the sale of our securities, if our securities become publicly traded. In addition, the liquidity for our securities may be decreased, with a corresponding decrease in the price of our securities. Our shares in all probability will be subject to such penny stock rules and our stockholders will, in all likelihood, find it difficult to sell their securities.
OTC Bulletin Board Qualification for Quotation
To have our shares of Common Stock on the OTC Bulletin Board, a market maker must file an application on our behalf in order to make a market for our Common Stock. We have not had conversations with nor engaged any market maker to file our application on Form 211 with FINRA. No Assurances can be made that we will be able to obtain a sponsor to file our application.
Stockholders
As of the date of this Annual Report, we had 50 holders of record of our Common Stock.
Dividends
We have not declared any cash dividends on our Common Stock since our inception and do not anticipate paying such dividends in the foreseeable future. Any decisions as to future payments of dividends will depend on our earnings and financial position and such other facts, as the Board of Directors deems relevant.
ITEM 6.
ITEM 6. SELECTED FINANCIAL DATA.
We are a smaller reporting company as defined by Rule 12b-2 of the Securities Exchange Act of 1934 and are not required to provide the information under this item.
ITEM 7.
ITEM 7. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS.
This discussion summarizes the significant factors affecting the operating results, financial condition, liquidity and cash flows of the Company for the fiscal years ended December 31, 2019 and 2018. The discussion and analysis that follows should be read together with our financial statements and the notes to the financial statements included elsewhere in this Annual Report on Form 10-K. Except for historical information, the matters discussed in this section are forward looking statements that involve risks and uncertainties and are based upon judgments concerning various factors that are beyond the Company’s control. Consequently, and because forward-looking statements are inherently subject to risks and uncertainties, the actual results and outcomes may differ materially from the results and outcomes discussed in the forward-looking statements. You are urged to carefully review and consider the various disclosures made by us in this report.
Overview
We were incorporated in Nevada on February 26, 2013, and on April 4, 2016, amended the Articles of Incorporation to change the name of the company to Team 360 Sports Inc. The Company provides amateur sports clubs, leagues and teams with easy to use robust digital administration management systems.
The Company has had minimal revenues as the Company has been developing its technology and platform. The trend in the marketplace is to provide services to teams versus large organizations such as leagues and clubs. The Company is planning to move into that marketplace, however there can be no assurances that it will succeed.
Results of Operations
Comparison of twelve-month periods ended December 31, 2019 and 2018
Revenue
We have generated $2,557 and $2,557 in revenues for the year ended December 31, 2019 and 2018, respectively.
Expenses
General and administration expenses for the year ended December 31, 2019, amounted to $55,353, compared to $26,532 during the year ended December 31, 2018. The increase is due to increased consulting fees incurred in 2019 and certain marketing related costs.
Compensation expenses amounted to $450,000 and $450,000 for the year ended December 31, 2019 and 2018, respectively. The Company is paying $450,000 in share-based compensation to its Chief Executive Officer.
Impairment loss for the year ended December 31, 2019, amounted to $350,000. This is due to write down in value of domain name software acquired in October 2019.
Other expense for the year ended December 31, 2019 amounted to $37,091, compared to $4,342 during the year ended December 31, 2018. The increase is primarily due to an increase in interest expense as a result of amortization of the discount on notes payable associated with the Company’s convertible note.
Net Loss
For the year ended December 31, 2019, we incurred a net loss of $889,887, compared to a net loss of $478,717 for the year ended December 31, 2018. The increase is primarily attributable to the impairment loss assessed on the Company’s domain names acquired in October 2019.
Liquidity and Capital Resources
As of December 31, 2019, we have $214 in current assets and $837,819 in current liabilities. Our total assets were $214 and our total liabilities were $837,819. We had $214 in cash and our working capital deficit was $837,605.
Cash Flows:
There was $54,672 used in operations during the year ended December 31, 2019 and $24,587 net cash used in operating activities during the year ended December 31, 2018, $54,672 provided by financing activities during the year ended December 31, 2019, and $6,638 cash provided through financing activities during the year ended December 31, 2018. This resulted in no changes in net cash during the year ended December 31, 2019 and $17,949 decrease in cash during the year ended December 31, 2018.
Off-Balance Sheet Arrangements
We have no off-balance sheet arrangements.
Critical Accounting Policies and Estimates
The preparation of financial statements in conformity with generally accepted accounting principles of the United States (GAAP) requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the year. The more significant areas requiring the use of estimates include asset impairment, stock-based compensation, and future income tax amounts. Management bases its estimates on historical experience and on other assumptions considered to be reasonable under the circumstances. However, actual results may differ from the estimates.
We believe the following is among the most critical accounting policies that impact or consolidated financial statement. We suggest that our significant accounting policies, as described in our financial statements in the Summary of Significant Accounting Policies, be read in conjunction with this Management’s Discussion and Analysis of Financial Condition and Results of Operations.
ITEM 7A.
ITEM 7A. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK.
Not applicable.
ITEM 8.
ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA.
The financial statements annexed to this Form 10-K for the year ended December 31, 2019 begin on page and have been audited by our independent accountants, Heaton & Company, PLLC (dba Pinnacle Accountancy Group of Utah).
ITEM 9.
ITEM 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE
None.
ITEM 9A.
ITEM 9A. CONTROLS AND PROCEDURES.
Evaluation of Disclosure Controls and Procedures
Under the supervision and with the participation of our management, Sandor Miklos, who is our Chief executive officer and Chief financial officer, as of December 31, 2019, we conducted an evaluation of our disclosure controls and procedures, as such term is defined under Rule 13a-15(e) and Rule 15d-15(e) promulgated under the Securities Exchange Act of 1934, as amended. Based on this evaluation, our Chief Executive Officer has concluded that, based on the material weaknesses discussed below, our disclosure controls and procedures were not effective as of such date to ensure that information required to be disclosed by us in reports filed or submitted under the Securities Exchange Act were recorded, processed, summarized, and reported within the time periods specified in the Securities and Exchange Act Commission's rules and forms and that our disclosure controls are not effectively designed to ensure that information required to be disclosed by us in the reports that we file or submit under the Securities Exchange Act is accumulated and communicated to management, including our Chief Executive Officer, as appropriate to allow timely decisions regarding required disclosure.
Management's Annual Report on Internal Control over Financial Reporting
Management is responsible for establishing and maintaining adequate internal control over financial reporting. As defined in Rules 13a-15(f) under the Securities Exchange Act of 1934, internal control over financial reporting is a process designed by, or under the supervision of, Sandor Miklos, the Company's Chief Executive Officer, and effected by the Company's board of directors, management and other personnel, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with GAAP.
The Company's internal control over financial reporting includes those policies and procedures that (1) pertain to the maintenance of records, that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the Company's assets; (2) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the Company are being made only in accordance with authorizations of the Company's management and directors; and (3) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use or disposition of the Company's assets that could have a material effect on the financial statements.
Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.
Our management, including our principal executive officer and principal financial officer, assessed the effectiveness of our internal control over financial reporting at December 31, 2019. In making this assessment, management used the criteria set forth by the Committee of Sponsoring Organizations of the Treadway Commission (COSO) in Internal Control-Integrated Framework (2013). Based on that assessment under those criteria, management has determined that, as of December 31, 2019, our internal control over financial reporting was not effective.
Our internal controls are not effective for the following reasons: (i) there is an inadequate segregation of duties consistent with control objectives as management is comprised of only two persons, one of which is the Company's principal executive officer and principal financial officer and, (ii) the Company does not have an audit committee with a financial expert, and thus the Company lacks the board oversight role within the financial reporting process.
In order to mitigate the foregoing material weakness, we have engaged an outside accounting consultant with significant experience in the preparation of financial statements in conformity with GAAP to assist us in the preparation of our financial statements to ensure that these financial statements are prepared in conformity with GAAP. We will continue to monitor the effectiveness of this action and make any changes that our management deems appropriate.
We would need to hire additional staff to provide greater segregation of duties. Currently, it is not feasible to hire additional staff to obtain optimal segregation of duties. Management will continue to reassess this matter to determine whether improvement in segregation of duty is feasible. In addition, we would need to expand our board to include independent members.
Going forward, we intend to evaluate our processes and procedures and, where practicable and resources permit, implement changes in order to have more effective controls over financial reporting.
This Annual Report does not include an attestation report of our registered public accounting firm regarding internal control over financial reporting. Management's report was not subject to attestation by the Company's registered public accounting firm pursuant to the exemption provided to issuers that are not "large accelerated filers" nor "accelerated filers" under the Dodd-Frank Wall Street Reform and Consumer Protection Act.
Changes in Internal Control over Financial Reporting
There have been no changes in our internal control over financial reporting that occurred during our fourth fiscal quarter that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.
ITEM 9B.
ITEM 9B. OTHER INFORMATION.
None.
PART III
ITEM 10.
ITEM 10. DIRECTORS, EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE.
Neither the Company, its property, nor any of its directors or officers is a party to any pending legal proceeding, nor have they been subject to a bankruptcy petition filed against them. None of its officers or directors have been convicted in, nor is subject to, any criminal proceeding.
The names and ages of the directors and executive officers of the Company and their positions with the Company are as follows:
Sandor (Alex) Miklos -- President, Chief Executive Officer, Chief Financial Officer (Principal Accounting Officer), Chairman of the Board of Directors
Mr. Miklos started his post high school education Seneca College in Toronto and graduated with a science diploma. His financial career began in 1987 with a bank owned investment firm managing currency and interest rate risk for large institutions utilizing, futures, options, and other derivatives. Later in his career he was selected as the manager of Ontario Secondary School Teachers Federation’s funds. His ongoing education include business at Laurier University in Waterloo; Wharton School of Business in conjunction with the Investment Management Consultants Association (IMCA where he earned the Certified Investment Management Consultant (CIMA) designation and utilized it until 2004 when he left the professional advisory investment business. Since 2004 he has been an angel investor and business consultant specializing in sales and marketing. In the past, he has held real estate, securities, futures, options and derivatives, partners and officers’ licenses and a CIMA designation. He is a part owner and an employee of a Florida Company named Casavue, LLC, also a technology and software development company that is based in Florida. Mr. Miklos intends to devote between 10 and 20 hours per week or more if needed to manage and direct the operations of the Company. Mr. Miklos has a compensation agreement with the Company.
Simon Smith, Vice President and Chief Technical Officer
Simon is a Science graduate with a M.Sc. in Physics from Queens University in Canada and a B.Sc. from Warwick University in the U.K. After graduation Simon worked as a researcher for Oil and Gas companies in the fields of electromagnetics and ultrasound. 1996-2002 Simon worked in Europe and the Middle East managing ERP implementations for Chemical, Utility and Mining companies. In 2002 Simon became the CTO of Detectent, a US based company providing software and analytics for the utility industry, Simon was one of the founders of this company which grew to over 50 employees until it was sold to Silver Springs Networks in 2014. Simon also started his own IT company based in Vietnam and Thailand in 2005 which provides IT programming and Quality Assurance services as well as global sourcing software to the Oil and Gas industry. He is a part owner and an employee of a Florida Company named Casavue, LLC, also a technology and software development company that is based in Florida. Mr. Smith intends to devote between 10 and 20 hours per week or more if needed to manage and direct the operations of the Company. Mr. Smith has a compensation agreement with the Company.
ITEM 11.
ITEM 11. EXECUTIVE COMPENSATION.
Summary Compensation. The following table summarizes, for each of 2019 and 2018 the compensation awarded, paid to or earned by our President, CEO and Chairman of the Board of Directors, Sandor Miklos and our Vice President and Chief Technical Officer Simon Smith who are compensated for their services to the Company; no other officer receives compensation from the Company. Until the Company acquires additional capital, it is not anticipated that any other officer other than these two individuals will receive compensation from the Company other than reimbursement for out-of-pocket expenses incurred on behalf of the Company.
(1) The Company has entered into an employment agreement with Mr. Miklos dated January 1, 2015 which provides for compensation for Mr. Miklos in the form of 100,000 shares of the Company's common stock for each year of his service to the Company and any other financial compensation, however, no monetary compensation has been paid to date. The Agreement was amended as of January 1, 2017 to provide the annual compensation at the annual rate of 200,000 shares of Company common stock for services rendered after January 1, 2017, together with a cash payment of $75,000 for each year after January 1, 2017. During the year ended December 31, 2017, no compensation has been paid or accrued to Mr. Miklos in addition to the 200,000 shares of common stock issued at a value of $1 per share. On January 1, 2018, The Company amended the January 1, 2015 Executive and Consulting Agreement with Sandor Miklos, President and member of the Board of Directors for services rendered. The amended agreement calls for annual compensation of 450,000 common shares of the Company fully earned immediately to be assigned and registered fully as at the end of the fiscal year. As of December 31, 2019, 450,000 shares valued at $1.00 per share for a total of $450,000 was accrued as compensation for Sandor Miklos.
(2) The Company has entered into an employment agreement with Mr. Smith dated January 1, 2016 which provides for compensation for Mr. Smith in the form of 100,000 shares of the Company's common stock for each year of his service to the Company and any other financial compensation, however, no monetary compensation has been paid to date. The Agreement was amended as of January 1, 2017 to provide the annual compensation at the annual rate of 200,000 shares of Company common stock for services rendered after January 1, 2017. A payment was made to Mr. Smith in 2015 for the complete development of the software by payment to software developers from Vietnam and Thailand, some of which is compensation to him in conjunction with such development. During the year ended December 31, 2018, the Company issued Mr. Smith 200,000 shares of common stock issued at a value of $1 per share.
The Company has no stock option, retirement, pension, or profit sharing programs for the benefit of directors, officers or other employees, but our officers and directors may recommend adoption of one or more such programs in the future.
The Company does not have a standing compensation committee, audit committee, nomination committee, or committees performing similar functions. We anticipate that we will form such committees of the Board of Directors once we have a full Board of Directors.
ITEM 12.
ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED STOCKHOLDER MATTERS.
The following table sets forth certain information as of April 14, 2020, with respect to the beneficial ownership of our common stock for (i) each director and officer, (ii) all of our directors and officers as a group, and (iii) each person known to us to own beneficially five percent (5%) or more of the outstanding shares of our common stock. As of April 14, 2020 there were 5,131,612 shares of common stock outstanding.
Name and Address of
Beneficial Owner (1)
Class of
Securities
Shares Beneficially
Owned
Percentage
Owned (2)
Directors and Executive Officers
Sandor Alex Miklos, Chief Executive Officer, Chief Financial Officer, President and Director Common Stock 1,800,000 33.12%
Simon Smith, Vice President and Chief Technical Officer Common Stock 500,000 6.21%
All Officers and Directors
Common Stock
2,300,000
39.33%
5% Stockholders
Mario Discepola Common Stock 1,500,000 31.05%
Brookside Investments Ltd. Common Stock 375,000 7.76%
0815423 BC Ltd Common Stock 375,000 7.76%
Hartswood Limited Common Stock 375,000 7.76%
(1) Beneficial ownership has been determined in accordance with Rule 13d-3 under the Exchange Act. Pursuant to the rules of the SEC, shares of common stock which an individual or group has a right to acquire within 60 days pursuant to the exercise of options or warrants are deemed to be outstanding for the purpose of computing the percentage ownership of such individual or group, but are not deemed to be beneficially owned and outstanding for the purpose of computing the percentage ownership of any other person shown in the table.
(2) Based on 5,131,612 shares of our Common Stock issued and outstanding as of April 14, 2020.
ITEM 13.
ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS, AND DIRECTOR INDEPENDENCE.
Family relationships between any of the selling shareholders and Sandor Miklos, our President, CEO and Chairman of the Board of Directors:
The following table shows the relationship of stockholders of the Company's common stock and their relationship to officers, directors and principal stockholders of the Company:
*shares are held by family and former family members who are not residing in the same household as the parent or former spouse and such shares are not deemed to be beneficially owned by the parent or former spouse.
Related Party Transactions
On January 1, 2018, The Company amended the January 1, 2015 Executive and Consulting Agreement with Sandor Miklos, President and member of the Board of Directors for services rendered. The amended agreement calls for annual compensation of 450,000 common shares of the Company fully earned immediately to be assigned and registered fully as at the end of the fiscal year. As of December 31, 2019, 450,000 shares valued at $1.00 per share for a total of $450, 000 was accrued as compensation for Sandor Miklos.
ITEM 14.
ITEM 14. PRINCIPAL ACCOUNTING FEES AND SERVICES.
The following table shows the fees paid or accrued by us for the audit and other services provided by Heaton & Company, PLLC (dba Pinnacle Accountancy Group of Utah), for the fiscal periods shown.
Audit fees consist of fees billed for professional services rendered for the audit of our financial statements and review of the interim financial statements included in quarterly reports and services that are normally provided by the above auditors in connection with statutory and regulatory fillings or engagements.
Audit-Related Fees" are fees for assurance and related services by the principal accountant that are traditionally performed by the principal accountant and which are "reasonably related to the performance of the audit or review of the registrant's financial statements.
In the absence of a formal audit committee, the full Board of Directors pre-approves all audit and non-audit services to be performed by the independent registered public accounting firm in accordance with the rules and regulations promulgated under the Securities Exchange Act of 1934, as amended. The Board of Directors pre-approved 100% of the audit, audit-related and tax services performed by the independent registered public accounting firm for the fiscal years ended December 31, 2019 and 2018. The percentage of hours expended on the principal accountant’s engagement to audit the Company’s financial statements for the most recent fiscal year that were attributed to work performed by persons other than the principal accountant’s full-time, permanent employees was 0%.
PART IV
ITEM 15.
ITEM 15. EXHIBITS AND FINANCIAL STATEMENT SCHEDULES.
The following documents are filed as part of this Annual Report:
(a) Financial Statements:
(b) Exhibits:
REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
To the Board of Directors and Stockholders
Team 360 Sports, Inc.
Maple, Ontario, Canada
Opinion on the Financial Statements
We have audited the accompanying balance sheets of Team 360 Sports, Inc. (the Company) as of December 31, 2019 and 2018, and the related statements of operations, stockholders’ equity (deficit), and cash flows for the years then ended, and the related notes (collectively referred to as the financial statements). In our opinion, the financial statements present fairly, in all material respects, the financial position of the Company as of December 31, 2019 and 2018, and the results of its operations and its cash flows for the years then ended, in conformity with accounting principles generally accepted in the United States of America.
Consideration of the Company’s Ability to Continue as a Going Concern
The accompanying financial statements have been prepared assuming that the Company will continue as a going concern. The Company has suffered recurring losses and has no operations which raise substantial doubt about its ability to continue as a going concern. Management’s plans in regard to these matters are described in Note 3. The financial statements do not include any adjustments that might result from the outcome of this uncertainty.
Basis for Opinion
These financial statements are the responsibility of the Company’s management. Our responsibility is to express an opinion on the Company’s financial statements based on our audits. We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) (PCAOB) and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.
We conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audits to obtain reasonable assurance about whether the financial statements are free of material misstatement, whether due to error or fraud. The Company is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting. As part of our audits, we are required to obtain an understanding of internal control over financial reporting, but not for the purpose of expressing an opinion on the effectiveness of the Company’s internal control over financial reporting. Accordingly, we express no such opinion.
Our audits included performing procedures to assess the risks of material misstatement of the financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements. Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the financial statements. We believe that our audits provide a reasonable basis for our opinion.
/s/ Pinnacle Accountancy Group of Utah
We have served as the Company’s auditor since 2017.
Pinnacle Accountancy Group of Utah
a dba of Heaton & Company, PLLC
Farmington, Utah
April 15, 2020
Team 360 Sports Inc.
Balance Sheets
The accompanying notes are an integral part of these audited financial statements.
Team 360 Sports Inc.
Statements of Operations
The accompanying notes are an integral part of these financial statements.
Team 360 Sport Inc.
Statement of Stockholders’ Deficit
For the Years ended December 31, 2019 and
The accompanying notes are an integral part of these audited financial statements.
Team 360 Sports Inc.
Statements of Cash Flows
The accompanying notes are an integral part of these financial statements.
Team 360 Sports Inc.
Notes to the Financial Statements
For the Years ended December 31, 2019 and December 31, 2018
Note 1 - Organization
Organization
TSI Sports Inc. (the Company) incorporated in the State of Nevada on February 26, 2013. Effective April 4, 2016, the Company changed its name to Team 360 Sports, Inc. The Company will provide amateur sports clubs, leagues and teams with easy to use robust digital administration management systems.
Note 2 - Summary of significant accounting policies
Cash and Cash Equivalents
For purposes of reporting within the statements of cash flows, the Company considers all cash on hand, cash accounts not subject to withdrawal restrictions or penalties, and all highly liquid debt instruments purchased with a maturity of three months or less to be cash and cash equivalents.
Software Development Costs
Costs incurred to develop computer software products to be sold or otherwise marketed are charged to expense until technological feasibility of the product has been established. Once technological feasibility has been established, computer software development costs (consisting primarily of internal labor costs) are capitalized and reported at the lower of amortized cost or estimated realizable value. Purchased software development cost is capitalized and recorded at its estimated fair market value. When a product is ready for general release, its capitalized costs are amortized on a product-by-product basis. The annual amortization is the greater of the amounts of: the ratio that current gross revenues for a product bear to the total of current and anticipated future gross revenues for that product and, the straight-line method over the remaining estimated economic life (a period of three to ten years) of the product including the period being reported on.
Revenue Recognition
The Company records revenue in accordance with FASB Accounting Standards Codification (“ASC”) as topic 606 (“ASC 606”). The revenue recognition standard in ASC 606 outlines a single comprehensive model for recognizing revenue as performance obligations, defined in a contract with a customer as goods or services transferred to the customer in exchange for consideration, are satisfied. The standard also requires expanded disclosures regarding the Company’s revenue recognition policies and significant judgments employed in the determination of revenue.
On November 1, 2016 the Company entered into a Licensing Agreement. The agreement grants the Licensee rights to grant sublicenses to third parties. The license agreement calls for a one-time nonrefundable fee of $10,000 and a $3,000 set up and training fee. The license agreement also calls for a five percent (5%) royalty on further sales by licensees, but no royalty fees have been received to date. All fees and royalty payments are to be recognized over the life of the agreement, which terminates on December 1, 2021.
The setup and training services are essential in allowing the licensee the ability to license the software to third parties. As a result, the license and set up and training fees are not distinct from one another, and constitute a single performance obligation under the contract. Therefore, the one-time non-refundable fee and the set up and training fees are being recognized over time.
The Company recognized $2,557 and $2,557 of revenue during the twelve months ended December 31, 2019 and 2018, respectively. As of December 31, 2019 and December 31, 2018, there was deferred revenue of $4,902 and $7,460, respectively.
Income Taxes
The Company accounts for income taxes pursuant to FASB ASC Topic 740, Income Taxes. Under FASB ASC Topic 740, deferred tax assets and liabilities are determined based on temporary differences between the bases of certain assets and liabilities for income tax and financial reporting purposes. The deferred tax assets and liabilities are classified according to the financial statement classification of the assets and liabilities generating the differences.
The Company maintains a valuation allowance with respect to deferred tax assets. The Company establishes a valuation allowance based upon the potential likelihood of realizing the deferred tax asset and taking into consideration the Company’s financial position and results of operations for the current period. Future realization of the deferred tax benefit depends on the existence of sufficient taxable income within the carry-forward period under the Federal tax laws.
Changes in circumstances, such as the Company generating taxable income, could cause a change in judgment about the reliability of the related deferred tax asset. Any change in the valuation allowance will be included in income in the year of the change in estimate.
Interest and Penalties Policies
We classify tax-related penalties and net interest on income taxes as income tax expense. As of December 31, 2019 and December 31, 2018, no income tax expense had been incurred.
Estimates
The financial statements are prepared on the basis of accounting principles generally accepted in the United States of America. The preparation of financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities as of December 31, 2019 and December 31, 2018. Actual results could differ from those estimates made by management.
Earnings (loss) per share
Basic earnings (loss) per share calculations are determined by dividing net income (loss) by the weighted average number of shares outstanding during the year. Diluted earnings (loss) per share calculations are determined by dividing net income (loss) by the weighted average number of shares. The Company does not have any potentially dilutive instruments related to convertible notes and liabilities to be settled with stock for the years ended December 31, 2019 and December 31, 2018 because their effect is anti-dilutive.
Recent Accounting Pronouncements
On May 15, 2019, the FASB issued ASU 2019-05, 9 which provides transition relief for entities adopting the Board’s credit losses standard, ASU 2016-13. Specifically, ASU 2019-05 amends ASU 2016-13 to allow companies to irrevocably elect, upon adoption of ASU 2016-13, the fair value option for financial instruments that (1) were previously recorded at amortized cost and (2) are within the scope of the credit losses guidance in ASC 326-20, (3) are eligible for the fair value option under ASC 825-10, and (4) are not held-to-maturity debt securities. For entities that have adopted ASU 2016-13, the amendments in ASU 2019-05 are effective for fiscal years beginning after December 15, 2019, including interim periods therein. An entity may early adopt the ASU in any interim period after its issuance if the entity has adopted ASU 2016-13. For all other entities, the effective date will be the same as the effective date of ASU 2016-13. The Company does not believe that this will have an impact on its financial statements.
On March 21, 2019, the FASB issued ASU 2019-03, 2 which amends the definition of the term “collections” in U.S. GAAP by aligning it with the definition used in the Code of Ethics for Museums of the American Alliance of Museums. The amendments in the ASU “require that a collection-holding entity disclose its policy for the use of proceeds from when collection items are deaccessioned (that is, removed from a collection).” Next Steps: The ASU’s amendments are effective prospectively for annual financial statements issued for fiscal years beginning after December 15, 2019, and for interim periods within fiscal years beginning after December 15, 2020. Early adoption is permitted. The Company does not believe that this will have an impact on its financial statements.
Recently Adopted Accounting Pronouncements
In February 2016, the FASB issued an accounting standards update for leases. The ASU introduces a lessee model that brings most leases on the balance sheet. The new standard also aligns many of the underlying principles of the new lessor model with those in the current accounting guidance as well as the FASB's new revenue recognition standard. However, the ASU eliminates the use of bright-line tests in determining lease classification as required in the current guidance. The ASU also requires additional qualitative disclosures along with specific quantitative disclosures to better enable users of financial statements to assess the amount, timing, and uncertainty of cash flows arising from leases. The pronouncement is effective for annual reporting periods beginning after December 15, 2019, and interim periods within fiscal years beginning after December 15, 2020, for nonpublic entities using a modified retrospective approach. We adopted ASU 2016-02 as of January 1, 2019 using the modified retrospective method which leaves the comparative period reporting unchanged. The adoption of this standard did not have an impact on the Company’s financial statements.
On June 20, 2018, the FASB issued ASU 2018-07,1 which simplifies the accounting for share-based payments granted to nonemployees for goods and services. Under the ASU, most of the guidance on such payments to nonemployees would be aligned with the requirements for share-based payments granted to employees. For public business entities (PBEs), the amendments in ASU 2018-07 are effective for fiscal years beginning after December 15, 2018, including interim periods therein. For all other entities, the amendments are effective for fiscal years beginning after December 15, 2019, and interim periods within fiscal years beginning after December 15, 2020. Early adoption is permitted if financial statements have not yet been issued (for PBEs) or have not yet been made available for issuance (for all other entities), but no earlier than an entity’s adoption date of ASC 606. If early adoption is elected, all amendments in the ASU that apply must be adopted in the same period. In addition, if early adoption is elected in an interim period, any adjustments should be reflected as of the beginning of the fiscal year that includes that interim period. The adoption of this standard did not have an impact on the Company’s financial statements.
Note 3 - Going Concern
The accompanying financial statements have been prepared on a going concern basis, which contemplates the realization of assets and the satisfaction of liabilities in the normal course of business. The Company has had minimal revenue and has accumulated a deficit of $2,188,337 as of December 31, 2019. The Company requires capital for its contemplated operational and marketing activities. The Company’s ability to raise additional capital through the future issuances of common stock is unknown. The attainment of additional financing, the successful development of the Company’s contemplated plan of operations, and its transition, ultimately, to the attainment of profitable operations are necessary for the Company to continue operations. These conditions and the ability to successfully resolve these factors raise substantial doubt about the Company’s ability to continue as a going concern within one year from the date these financial statements are issued. The financial statements of the Company do not include any adjustments that may result from the outcome of these uncertainties.
The Company has discussed ways in order to mitigate conditions or events that may raise substantial doubt about its ability to continue as a going concern, there are no assurances that any of these measures will successfully mitigate or be effective at all. (1) The Company shall pursue financing plans to raise funds to judiciously spend towards operational expenses, (2) The Company shall continue to employ low cost measures to operate its business and analyze any unnecessary cost or expense, (3) The Company will seek to avoid unnecessary expenditures, travel, and lodging costs that are not mission critical to its business, (4) The Company shall seek to continuously maximize its assets and business licensing strategies to increase revenue as well as to gain new customers.
Note 4 - Intangible assets
On October 31, 2019, the Company acquired the rights to four domain names from a third party. The cost to acquire the domain names was 350,000 shares of common stock valued at $1.00 per share for a total value of $350,000. The domain names were recorded as an intangible asset with a indefinite useful life. The Company’s management evaluated the domain names at December 31, 2019 and determined, based on economic factors as well as other internal factors, that the domain names be considered fully impaired and we recorded an impairment loss of $350,000 as of December 31, 2019. These shares have not bee been issued and are recorded on the balance sheet under liability to be settled with stock.
Note 5 - Loans Payable
During the year ended 2018, the Company received a total of $3,857 in loan funds for operating expenses from the same party. The total outstanding balance on the note at December 31, 2018 was $47,747 which included $43,405 of principal and $4,342 in accrued interest.
On July 6, 2019, the holder of this note demanded payment on the outstanding principle and interest of the note in the amount of $66,240. On July 8, 2019, the holder of the noted agreed to refinance the outstanding amount into a convertible note (see Note 6).
During the year ended December 31, 2019, the Company received a total of $53,335. The total outstanding balance on the note as of December 31, 2019 after the convertible note refinance of $66,240 was $38,757 which included $37,420 of principal and $1,337 in accrued interest. The Company recorded $1,337 of interest expense on this note for year ended December 31, 2019.
Note 6 - Convertible Note Payable
On July 9, 2018, the Company entered into a convertible note agreement with the holder of the promissory note, whereby the holder agreed to refinance for an aggregate principal amount of $66,240 and $25,000 for administrative and consulting fees for a total note amount of $91,240.
The note earns an interest rate equal to 10% per annum and matures after 180 days on January 9, 2020. The Company recorded a debt discount of $25,000 as result of the original issue discount. The note is convertible at fixed rate of $0.005 of common stock. Because of the fixed nature of the conversion the Company determined that there was no beneficial conversion feature which would have qualified it for derivative accounting under ASC 815-15, Derivatives and Hedging.
For the year ended December 31, 2019, the Company recorded $24,321 amortization of the debt discount on the note leaving $695 unamortized. The Company also recorded accrued interest expense of $4,207.
Note 7 - Stockholders’ Equity
As of December 31, 2019 and 2018 a total of 5,131,612 shares of common stock are issued and outstanding.
Note 8 - Income Taxes
The Company provides for income taxes under FASB ASC 740, Accounting for Income Taxes. FASB ASC 740 requires the use of an asset and liability approach in accounting for income taxes. Deferred tax assets and liabilities
are recorded based on the differences between the financial statement and tax bases of assets and liabilities and the tax rates in effect currently.
FASB ASC 740 requires the reduction of deferred tax assets by a valuation allowance, if, based on the weight of available evidence, it is more likely than not that some or all of the deferred tax assets will not be realized. In the Company’s opinion, it is uncertain whether they will generate sufficient taxable income in the future to fully utilize the net deferred tax asset.
Accordingly, a valuation allowance equal to the deferred tax asset has been recorded. The cumulative deferred tax asset for the years 2019 and 2018 is $120,237 and $33,905, respectively, which is calculated by multiplying the estimated tax rate by the cumulative net operating loss (NOL) adjusted for the following items:
Details of valuation allowance for the last two years are as follows:
Rate Reconciliation:
Uncertain Tax Positions
Unrecognized income tax benefits represent income tax positions taken on income tax returns but not yet recognized in the financial statements. If recognized, substantially all of the unrecognized tax benefits for the Company’s fiscal years ended December 31, 2019 and 2018 would affect the effective income tax rate. There were no unrecognized income tax benefits as of December 31, 2019 and 2018.
The Company recognizes the interest and penalties accrued related to unrecognized tax benefits in income tax expense. The Company did not recognize any expenses any interest and penalties as of December 31, 2019 and 2018, respectively.
All tax years since inception are open for examination by taxing authorities.
Note 9 - Related party transactions
On January 1, 2018, the Company amended the January 1, 2015 Executive and Consulting Agreement with Sandor Miklos, President and member of the Board of Directors for services rendered. The amended agreement calls for annual compensation of 450,000 common shares of the Company fully earned immediately to be assigned and registered fully as at the end of the fiscal year.
On November 20, 2018, the Company received a loan payable in the amount of $2,781 from a more than 5% shareholder for the payment of Company expenses. This loan is unsecured, non-interest bearing, and has no specific terms for repayment. As of December 31, 2019, the Company had a loan payable of $2,781 to the same party.
On June 1, 2019, Sandor Miklos forgave accrued stock compensation owed to him valued at $562,500, which represents the compensation for the full year 2018 ($450,000) and the three months ended March 31, 2019 ($112,500). For the remaining nine months ended December 31, 2019, 337,500 shares valued at $1.00 per share for a total of $337,500 was accrued as compensation for Sandor Miklos. As of December 31, 2019, there is accrued stock compensation owed to Sandor Miklos valued at $337,500.
Note 10 - Subsequent Events
The Company’s management evaluated subsequent events through the date the financial statements were issued and there were no subsequent events to report except as noted below.
On January 2, 2020, the Company amended a convertible note payable (convertible note payable, see Note 6) to extend the due date to January 1, 2021.
SIGNATURES
Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.