Annual report pursuant to Section 13 and 15(d)

EQUITY TRANSACTIONS

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EQUITY TRANSACTIONS
12 Months Ended
Sep. 30, 2018
Stockholders' Equity Note [Abstract]  
EQUITY TRANSACTIONS

NOTE 6 -EQUITY TRANSACTIONS

 


Preferred Stock

 

In June 2010, the Board of Directors voted to amend the Company’s Articles of Incorporation in order to authorize the issuance of 200 million shares of Preferred Stock with a par value of $0.00001 per share. Concurrently, the Board designated the preferred stock as Series A Convertible Preferred Stock. Among other things, the Certificate of Designation of Series A Convertible Preferred (i) authorizes 1,250,000 shares of the Corporation’s preferred stock to be designated “Series A Convertible Preferred Stock (ii) is convertible into the Company's common stock after two years at a conversion price of $0.01 per share at the holder's option (iii) each holder of Series A Preferred



Stock is entitled to receive cumulative dividends, payable quarterly in either cash or equivalent shares of common stock at the rate of 8% of $1.00 per annum on each outstanding share of Series A Preferred then held by such Series A Preferred Holder, on a pro rata basis.

 

In August 2012, the Board of Directors voted to amend the Company’s Articles of Incorporation to designate the Series B Preferred Stock setting forth the rights and preferences of the Series B Preferred Stock. Among other things, the Certificate of Designation (i) authorizes 10 (ten) shares of the Corporations preferred stock to be designated as Series B Preferred Stock; (ii)grants no conversion rights to the holders of the Series B Preferred Stock; (iii) provides the holders of Series B Preferred Stock shall vote with the holders of the Corporation’s common stock and any class or series of capital stock of the Corporation hereafter created; and (iv) provides that if at least on share of Series B Preferred Stock is issued and outstanding, then the total aggregate issued shares of Series B Preferred stock at any given time, regardless of their number, shall have voting rights equal to two (2) times the sum of: i) the total number of shares of Common Stock which are issued and outstanding at the time of voting, plus ii)the total number of shares of any Preferred Stocks which are issued and outstanding at the time of voting.

 

In October 2012, the Board of Directors voted to amend the Company’s Articles of Incorporation to designate the Series C and Series D Convertible Preferred Stock setting forth the rights and preferences of the Series C and D Convertible Preferred Stock, par value $.00001 per share. Among other things, the Certificate of Designation for the Series C Preferred (i) authorizes fifty million (50,000,000) shares of the Corporation’s preferred stock to be designated as “Series C Convertible Preferred Stock”; (ii) grants conversion rights to the holders of the Series C Preferred Stock; (iii) provides that each share of Series C Preferred Stock shall ten votes for any election or other vote placed before the shareholders of the Corporation; (iv) provides for anti-dilutive rights; (v) provides for liquidation rights; (vi) establishes the initial price at $2.50 per share; (vii) entitles the holder of the Series C Preferred Stock to receive dividends when, as and if declared by the Board of Directors. Among other things, the Certificate of Designation for the Series D Preferred (i) authorizes ten million (10,000,000) shares of the Corporation’s preferred stock to be designated as “Series D Convertible Preferred Stock”; (ii) grants conversion rights to the holders of the Series D Preferred Stock; (iii) provides that each share of Series D Preferred Stock shall ten votes for any election or other vote placed before the shareholders of the Corporation; (iv) provides for anti-dilutive rights; (v) provides for liquidation rights; (vi) establishes the initial price at $5.00 per share; (vii) entitles the holder of the Series D Preferred Stock to receive dividends when, as and if declared by the Board of Directors.                                                                                                                     

 

Preferred Share Designations

 

In December 2013, the Board of Directors voted to amend the Company’s Articles of Incorporation to change the conversion rights of the Series C and Series D Convertible Preferred Stock. Each share of the Series C and Series D Preferred Stock is convertible into five shares of common stock.

 

In October 2016, the Board of Directors voted to amend the Company’s Articles of Incorporation to designate the Series E Convertible Preferred Stock setting forth the rights and preferences of the Series E Convertible Preferred Stock, par value $.00001 per share. Among other things, the Certificate of Designation for the Series E Preferred (i) authorizes ten million (10,000,000) shares of the Corporation’s preferred stock to be designated as “Series E Convertible Preferred Stock”; (ii) grants conversion rights to the holders of the Series E Preferred Stock; (iii) provides that each share of Series E Preferred Stock shall be ten votes for any election or other vote placed before the shareholders of the Corporation; (iv) provides for anti-dilutive rights; (v) provides for liquidation rights; (vi) establishes the initial price at $1.00 per share; (vii) entitles the holder of the Series E Preferred Stock to receive dividends when, as and if declared by the Board of Directors.



As of September 30, 2018 and 2017, the cumulative arrearage of undeclared dividends for Series A Preferred stock totaled $88,683 and $44,949, respectively


Preferred stock issued for cash

 

In November 2016, the Company sold 525,746 shares of Series A Convertible Preferred stock to a private investor and director for $262,873 in cash.

 

Series A  Convertible Preferred stock exchanged for Series C Convertible Preferred stock

 

In April 2018 a shareholder and director exchanged 53,500 shares of Series A Convertible Preferred stock for 1,070,000 shares of Series C Convertible Preferred Stock.

 

Series B Preferred stock exchanged for Series C Convertible Preferred stock

 

In September 2018 the company’s Chief Financial Officer and director exchanged one share of Series B Preferred stock for 800,000 shares of Series C Convertible Preferred Stock.

 

Preferred stock issued for acquisition of assets

 

In November, 2016, the Board of Directors approved the Asset Purchase Agreement between the Company and Collabria LLC (“Collabria”). Under the terms of the Agreement, the Company acquired all of the intellectual property of Collabria, including its ReadyOp command, control and communication platform trade named ReadyOp (the “ReadyOp Platform”). In addition, the Company acquired Collabria’s customer base (“Collabria Client List”). The Company assumed no liabilities of Collabria under this Agreement. The terms of the Agreement called for the Company to issue 3,000,000 (Three million) shares of restricted Series E Convertible Preferred stock to Collabria with a fair value of $292,240. Shares of the Series E Convertible Preferred have the following conversion rights and provisions: After a period of two (2) years following the date of issuance, each one (1) share of Series E Preferred shall be convertible into one hundred (100) shares of fully paid and non-assessable Common Stock at the sole option of the holder of Series E Preferred.

 

Common Stock

 

On September 13, 2012, the Board of Directors voted to increase the Company’s authorized shares of common stock to 5,000,000,000 shares and to decrease the par value to $.00001 per share.

 

Subscription Agreements between VoiceInterop, Inc., our wholly-owned subsidiary and private investors

 

During the year ended September 30, 2018, VoiceInterop, Inc. committed to sell 600,000 shares of its common stock to private investors for $68,000. The shares issuance is contingent upon a spin-off of the Company from Cleartronic, Inc. into a separate company. As of September 30, 2018, $68,000 is recorded as due to unrelated parties as the spin-off has not been completed and the shares have not been issued. The amount is included in liabilities from discontinued operations ( see Note 9). The capital raised by Voiceinterop, Inc. was used to fund the due diligence on potential acquisition and legal fees associated with the spin-off.