0001477932-17-002912.txt : 20170620 0001477932-17-002912.hdr.sgml : 20170620 20170620161510 ACCESSION NUMBER: 0001477932-17-002912 CONFORMED SUBMISSION TYPE: 10-K PUBLIC DOCUMENT COUNT: 46 CONFORMED PERIOD OF REPORT: 20161231 FILED AS OF DATE: 20170620 DATE AS OF CHANGE: 20170620 FILER: COMPANY DATA: COMPANY CONFORMED NAME: Sputnik Enterprises, Inc CENTRAL INDEX KEY: 0001326917 STANDARD INDUSTRIAL CLASSIFICATION: COMPUTER COMMUNICATIONS EQUIPMENT [3576] IRS NUMBER: 522348956 STATE OF INCORPORATION: NV FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 10-K SEC ACT: 1934 Act SEC FILE NUMBER: 000-52366 FILM NUMBER: 17920994 BUSINESS ADDRESS: STREET 1: 10781 SATELLITE BLVD CITY: ORLANDO STATE: FL ZIP: 32837 BUSINESS PHONE: 407-203-7032 MAIL ADDRESS: STREET 1: 10781 SATELLITE BLVD CITY: ORLANDO STATE: FL ZIP: 32837 FORMER COMPANY: FORMER CONFORMED NAME: Sputnik, Inc. DATE OF NAME CHANGE: 20050512 10-K 1 spni_10k.htm FORM 10-K spni_10k.htm

 

U.S. SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

 

Form 10-K

 

(Mark One)

 

[X] ANNUAL REPORT UNDER SECTION 13 OR 15(d)

OF THE SECURITIES EXCHANGE ACT OF 1934

 

For the fiscal year ended December 31, 2016

 

[ ] TRANSITION REPORT UNDER SECTION 13 OR 15(d)

OF THE SECURITIES EXCHANGE ACT OF 1934

 

For the transition period from ______________ to ______________

 

Commission File Number 000-52366

 


 

Sputnik Enterprises Inc.

 (Exact name of registrant as specified in its charter)

 


 

Nevada   52-2348956
(State or other jurisdiction of   (I.R.S. Employer
incorporation or organization)   Identification No.)

 

10781 Satellite Blvd

Orlando, Florida 34786

(Address of principal executive offices)

 

407.377.5880

(Registrant’s telephone number, including area code)

 


 

Securities registered under Section 12(b) of the Exchange Act:

 

None.

 

Securities registered under Section 12(g) of the Exchange Act:

 

 

 
 

Common Stock, $0.001 par value per share

(Title of Class)

 

Check whether the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act.  Yes [ ]  No [X]

 

Check whether the registrant is not required to file reports pursuant to Section 13 or 15(d) of the Exchange Act. [ ]

 


 

Check whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Exchange Act during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes [ ] No [X]

 

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§ 232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files). Yes [ ]     No [ ]

 

Check if there is no disclosure of delinquent filers in response to Item 405 of Regulation S-K (§229.405 of this chapter) contained herein, and no disclosure will be contained, to the best of registrant's knowledge, in definitive proxy or information statements incorporated by reference in Part III of this Form 10-K or any amendment to this Form 10-K. [ ]

 

Check whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company.  See definitions of “large accelerated filer,” “accelerated filer” and “smaller reporting company” in Rule 12b-2 of the Exchange Act. (Check one):

 

Large Accelerated Filer [ ] Accelerated Filer [ ]
     
Non-accelerated Filer    [ ] Smaller Reporting Company [X]
(Do not check if a smaller reporting company.)    

 

Check whether the issuer is a shell company (as defined in Rule 12b-2 of the Exchange Act).  Yes x  No

 

The aggregate market value of the Registrant’s Common Stock held by non-affiliates of the Registrant (based upon the closing price of the Registrant’s Common Stock as of June 30, 2016 was approximately $201,751 (based on 115,286 shares of common stock outstanding held by non-affiliates on such date, at $1.75 per share).  Shares of the Registrant’s Common Stock held by each executive officer and director and by each entity or person that, to the Registrant’s knowledge, owned 5% or more of the Registrant’s outstanding Common Stock as of June 30, 2016 have been excluded in that such persons may be deemed to be affiliates of the Registrant.  This determination of affiliate status is not necessarily a conclusive determination for other purposes.

 

 

APPLICABLE ONLY TO CORPORATE REGISTRANTS

 

As of May 31, 2017, there were 1,015,286 shares of common stock, par value $.001, outstanding.

 

 
 

INDEX

 

      Page Number
Item Number   PART I  
Item 1   Business 4
Item 1A   Risk Factors 5
Item 1B   Unresolved Staff Comments 5
Item 2   Properties 5
Item 3   Legal Proceedings 5
Item 4   Mine Safety Disclosures 5
       
    PART II  
       
Item 5   Market for Registrant’s Common Equity,  Related Stockholder Matters and Issuer Purchase of Equity Securities 5
Item 6   Selected Financial Data 6
Item 7   Management’s Discussion and Analysis of Financial Condition and Results of Operations 6
Item 7A   Quantitative and Qualitative Disclosures about Market Risk 8
Item 8   Financial Statements and Supplementary Data 8
Item 9     Changes in and Disagreements with Accountants on Accounting and Financial Disclosure 9
Item 9A     Controls and Procedures 9
Item 9B   Other Information 10
    PART III  
       
Item 10   Directors, Executive Officers, Promoters and Corporate Governance 10
Item 11     Executive Compensation 12
Item 12     Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters 12
Item 13     Certain Relationships and Related Transactions, and Director Independence 13
    PART IV  
Item 14     Principal Accounting Fees and Services 14
Item 15     Exhibits, Financial Statement Schedules 14
Signatures       15

 

 

 
 

 
PART I

 

Item 1. Description of Business.

 

Sputnik Enterprises Inc. was incorporated in the State of Delaware on September 27, 2001 under the name Sputnik, Inc. On February 10, 2005, the Company filed Articles of Conversion and new Articles of Incorporation in Nevada and became a Nevada corporation. From that time until February 29, 2008 the Company developed and marketed Wi-Fi software, services, and hardware for the public access wireless networking market.

 

On November 13, 2007 the Company formed a wholly owned subsidiary, Laika, Inc., and transferred all of our assets and liabilities to Laika.

 

On February 6, 2008, the Company amended its Articles of Incorporation to change the name of Sputnik, Inc. to Sputnik Enterprises, Inc. upon conclusion of the sale of the stock of Laika, Inc. to AstroChimp, Inc.

 

On February 29, 2008, the Company closed the sale of the stock of our wholly owned subsidiary, Laika, Inc. to AstroChimp, Inc. for cancellation of a loan of $65,000 from David LaDuke to us, leaving us as a shell company. AstroChimp is wholly-owned by Mr. LaDuke. Subsequently, AstroChimp, Inc. changed its name to Sputnik, Inc. and continues to own and operate its business as a private entity.

 

On September 30, 2015, Sport Venture Group, LLC and Windy River Group, LLC acquired 5,000 shares (2,500 shares each) of Convertible Preferred Stock of the Company from R. Thomas Kidd for $250,000. If converted, this would represent 94.26% of the issued and outstanding common stock of the Company, representing a change in control of the Company. By amendment, the Series A Convertible Preferred Stock, not registered under Section 12(g), is currently convertible into common shares, which are registered under Section 12(g), at the rate of one share of Series A Convertible Preferred for 10,000 shares of common. 

 

At December 31, 2015, the Company was still a shell company.

 

An Agreement was made on February 5, 2016 between FV Corporation ("FV" or "Seller") and Sputnik Enterprises, Inc. ("SPNI" or "Buyer"). The Agreement provides that, subject to all the terms and conditions of this Agreement, at the Closing, FV agrees to receive from SPNI, and SPNI agrees to issue to the shareholders of the Seller (each, a "Shareholder") an aggregate of 45,170,085 shares of Common Stock ("SPNI Common Stock") and such number of shares of Series A Convertible Preferred Stock that convert into an additional 45,170,085 shares of Common Stock of SPNI ("SPNI Preferred Stock") (the SPNI Common Stock and the SPNI Preferred Stock collectively, the "Share Consideration") in exchange for the transfer of all of the issued and outstanding shares of the Common Stock of FV ("FV Shareholder's Shares") to SPNI. Each FV Shareholder's Share that is issued and outstanding immediately before the Closing shall entitle the holder thereof to receive one share of SPNI Common Stock and 0.0001 shares of SPNI Preferred Stock which equates to one share of common stock (together, the "Exchange Ratio"), such that when all shares of Common Stock and SPNI Preferred Stock have been issued under this Agreement and all shares Preferred Stock issued under this Agreement have been converted to common stock, an aggregate of 90,340,170 shares of SPNI Common Stock shall have been issued to FV's Shareholders under this Agreement. Notwithstanding the foregoing, prior to Closing, the parties shall adjust the number of FV Shareholder's Shares to be transferred to SPNI to such number of shares of FV Common Stock as is actually issued and outstanding as of the Closing Date and the aggregate number shares of SPNI Common Stock and SPNI Preferred Stock to be issued to the FV Shareholders shall be adjusted accordingly pursuant to the Exchange Ratio.

 

Closing of the Agreement is contingent upon a number of terms and conditions described in the Agreement, including completion of an audit of FV and the filing of the Form 8-K (“Super 8-K”) required to be filed at closing. Upon closing, the Company will no longer be deemed a shell company.

 

 

Item 1A. Risk Factors

 

As a “smaller reporting company” as defined by Item 10 of Regulation S-K, the Company is not required to provide this information.

 

Item 1B.  Unresolved Staff Comments

 

Not applicable as the Company is neither an accelerated filer nor a large accelerated filer.

 

Item 2. Description of Property.

 

The Company neither rents nor owns any properties. The Company utilizes the office space and equipment of its management at no cost. Management estimates such amounts to be immaterial.  The Company currently has no policy with respect to investments or interests in real estate, real estate mortgages or securities of, or interests in, persons primarily engaged in real estate activities.

 

Item 3. Legal Proceedings.

 

To the best knowledge of our officers and directors, the Company is not a party to any legal proceeding or litigation.

 

Item 4. Mine Safety Disclosures.

Not applicable.

  

PART II

 

Item 5. Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities.

 

Trading History

 

Our common stock was quoted on the Over-The-Counter Bulletin Board under the symbol “SPNI” until May 17, 2016 when it was moved to Over-The-Counter Pink Limited Information.
 

Bid Information*

Financial Quarter Ended   High Bid     Low Bid  
December 31, 2016   $ 2.00     $ 1.08  
September 30, 2016                                                                                                       $ 2.00     $ 1.16  
June 30, 2016   $ 1.75     $ 1.75  
March 31, 2016   $ 1.75     $ 1.75  
December 31, 2015   $ 1.75     $ 1.75  
September 30, 2015   $ 2.00     $ 2.00  
June 30, 2015   $ 4.00     $ 4.00  
March 31, 2015   $ 10.00     $ 5.00  

 

* The quotation do not reflect inter-dealer prices, without retail mark-up, mark-down or commission and may not represent actual transactions.

  

Common Stock

 

Our Certificate of Incorporation authorizes the issuance of up to 50,000,000 shares of common stock, par value $.001 per share (the “Common Stock”).  The Common Stock is listed on the OTC-Pink Limited Information with the symbol SPNI.OB.As of December 31, 2016, there were 93 shareholders of record of the Common Stock.

 

 

Preferred Stock

 

On February 6, 2008, Sputnik amended our Articles of Incorporation to authorize the issuance of 10,000,000 shares which will be designated “Preferred Stock.” The Company has issued 5,250 of its preferred stock, series A.  On December 22, 2015, the Company filed an Amendment to Certificate of Designation, which modified the rights of the holders of Series A Convertible Preferred Stock by changing the conversion ratio to 10,000 shares of common stock for one share of Series A Convertible Preferred Stock and eliminating any holding requirement before conversion.

 

There are only 50,000,000 shares of common stock authorized. This is an insufficient number of common shares for the conversion of the Series A Convertible Preferred Stock. It is the current intention of the Company following the filing of this report on Form 10-K and thereafter when the Company becomes current in all SEC filings to file an Information Statement on Schedule 14C to, among other things, increase the number of authorized shares of Common Stock to one billion shares.

 

Dividend Policy

 

The Company has not declared or paid any cash dividends on its common stock and does not intend to declare or pay any cash dividend in the foreseeable future. The payment of dividends, if any, is within the discretion of the Board of Directors and will depend on the Company’s earnings, if any, its capital requirements and financial condition and such other factors as the Board of Directors may consider.

 

Securities Authorized for Issuance under Equity Compensation Plans

 

The Company does not have any equity compensation plans or any individual compensation arrangements with respect to its common stock or preferred stock. The issuance of any of our common or preferred stock is within the discretion of our Board of Directors, which has the power to issue any or all of our authorized but unissued shares without stockholder approval.

 

Recent Sales of Unregistered Securities

 

None

 

Issuer Purchases of Equity Securities

 

None.

 

Item 6.  Selected Financial Data

 

As a “smaller reporting company” as defined by Item 10 of Regulation S-K, the Company is not required to provide this information. 

 

Item 7.  Management’s Discussion and Analysis of Financial Condition and Results of Operations

 

At December 31, 2016, Sputnik Enterprises was a “blank check company” in that it is a development stage company with an indicated business plan to engage in a merger or acquisition with an unidentified company or companies, or other entity or person

 

During the next twelve months, the Company anticipates incurring costs related to the following:

 

  (i) filing Exchange Act reports, and

 

  (ii) consummating a  share exchange with FV

 

The Company believes it will be able to meet these costs through use of funds loaned to or invested in us by our stockholders, management or other investors.

 

 

 

Liquidity

 

For the year ended December 31, 2016, the Company had net cash used in operations of $98,717 compared to $15,169 for the year ended December 31, 2015. Net cash provided by investing activities for the year ended December 31, 2016 and 2015 was $123,768 and $15,424, respectively. Financing activities consisted of shareholder loans, purchase of preferred stock in 2016, shareholder loans, and repayments in 2015.

 

On December 31, 2016, the Company had total assets of $26,136 compared to assets of $309 at December 31, 2015.

 

The Company had total liabilities of $150,143 as of December 31, 2016, which consisted of accounts payable and accrued expenses of $44,259, shareholder notes aggregating $98,768, accrued interest of $2,116 and advance from shareholder of $5,000. At December 31, 2015, the Company had accounts payable and accrued expenses in the amount of $4,914 and shareholder advance of $5,000.

 

Through December 31, 2016, the Company had an accumulated deficit of $2,773,818.

 

Capital Resources

 

The Company has financed its limited operations through funds loaned or advanced from its shareholders to meet minimum operating cash requirements. There is no written agreement for future funding.

 

Results of Operations

 

The Company’s net loss for the year ended December 31, 2016 was $139,402, which was an increase of $106,518 over our net loss for the year ended December 31, 2015 of $32,884. The change was primarily increased legal and professional fees expense of approximately $106,016 and an increase in other general and administrative expenses of $12,812, net of a decrease in interest expense of $11,534.

 

Off-Balance Sheet Arrangements

 

The Company does not have any off-balance sheet arrangements that have or are reasonably likely to have a current or future effect on the Company’s financial condition, changes in financial condition, revenues or expenses, results of operations, liquidity, capital expenditures or capital resources that is material to investors.  

 

Contractual Obligations

 

As a “smaller reporting company” as defined by Item 10 of Regulation S-K, the Company is not required to provide this information.

 

Critical Accounting Policies

 

The Company prepares its financial statements in conformity with GAAP, which requires management to make certain estimates and assumptions and apply judgments. We base our estimates and judgments on historical experience, current trends and other factors that management believes to be important at the time the financial statements are prepared and actual results could differ from our estimates and such differences could be material. We have identified below the critical accounting policies that are assumptions made by management about matters that are highly uncertain and that are of critical importance in the presentation of our financial position, results of operations and cash flows. On a regular basis, we review our accounting policies and how they are applied and disclosed in our financial statements.

 

 

Use of Estimates

 

The preparation of financial statements in conformity with GAAP in the United States of America 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 revenue and expenses during the reporting period. Actual results could differ from those estimates.

 

Financial Instruments

The Company’s balance sheet includes certain financial instruments. The carrying amounts of current assets and current liabilities approximate their fair value because of the relatively short period of time between the origination of these instruments and their expected realization.

 

Item 7A.  Quantitative and Qualitative Disclosures about Market Risk.

 

As a “smaller reporting company” as defined by Item 10 of Regulation S-K, the Company is not required to provide this information.

 

Item 8.  Financial Statements and Supplementary Data.

 

 

 

SPUTNIK ENTERPRISES INC.

INDEX TO FINANCIAL STATEMENTS

 

  Page
   
Report of Independent Registered Public Accounting Firm F-2
   
Financial Statements:  
   
Balance Sheets F-3
   
Statements of Operations F-4
   

Statement of Changes in Stockholders' Deficit  

F-5
   
Statements of Cash Flows F-6
   
Notes to Financial Statements F-7

 

 

 
 

 

 

REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

 

To the Board of Directors and Shareholders of:

Sputnik Enterprises, Inc.

Orlando, Florida

 

We have audited the accompanying balance sheets of Sputnik Enterprises, Inc. as of December 31, 2016 and December 31, 2015, and the related statements of operations, stockholders' deficit and cash flows for each of the years then ended. These financial statements are the responsibility of the Company's management. Our responsibility is to express an opinion on these financial statements based on our audits.

 

We conducted our audits in accordance with standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audits to obtain reasonable assurance about whether the financial statements are free of material misstatement. The Company was not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting. Our audits included consideration of internal control over financial reporting as a basis for designing audit procedures that are appropriate in the circumstances, 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. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audits provide a reasonable basis for our opinion.

 

In our opinion, the financial statements referred to above present fairly, in all material respects, the financial position of Sputnik Enterprises, Inc. as of December 31, 2016 and December 31, 2015, and the results of its operations and its cash flows for each of the years then ended in conformity with accounting principles generally accepted in the United States of America.

 

The accompanying financial statements have been prepared assuming that the Company will continue as a going concern. As discussed in Note 3 to the financial statements, the Company has recurring losses, negative cash flows from operating activities and working capital deficiencies. These conditions raise substantial doubt about its ability to continue as a going concern. Management's plans in regard to these matters are also described in Note 3. The financial statements do not include any adjustments that might result from the outcome of this uncertainty.

 

/s/Anton & Chia, LLP

Newport Beach, California

June 20, 2017

 

 

 

SPUTNIK ENTERPRISES, INC.

Balance Sheets

As of December 31, 2016 and 2015

 

    December 31,   December 31,
   

2016

 

2015

         
ASSETS                
  Current assets:                
    Cash   $ 676     $ 309  
    Loans to related party     24,684       —    
    Loan interest receivable     776       —    
      Total current assets     26,136       309  
                 
      Total assets   $ 26,136     $ 309  
                 
                 
LIABILITIES                
  Current liabilities:                
    Accounts payable and accrued expenses   $ 44,259     $ 4,914  
    Accrued interest     2,116       —    
    Note payable, related party     98,768       —    
    Advance from shareholder     5,000       5,000  
      Total current liabilities     150,143       9,914  
                 
  Long-term liabilities:                
                 
STOCKHOLDERS' DEFICIT                
  Preferred stock, $10.00 par value, 10,000,000 authorized;                
   5,250 and 5,200 shares issued and outstanding, respectively     52,500       52,000  
  Common stock, $.001 par value, 50,000,000 authorized;                
   1,015,286 shares issued and outstanding in both periods     1,015       1,015  
  Additional paid in capital- preferred stock     24,500       —    
  Additional paid in capital- common stock     2,571,796       2,571,796  
  Accumulated deficit     (2,773,818 )     (2,634,416 )
      Total stockholders' deficit     (124,007 )     (9,605 )
      Total liabilities and stockholders' deficit   $ 26,136     $ 309  

 

The accompanying notes are an integral part of these financial statements.

 

SPUTNIK ENTERPRISES, INC.

Statements of Operations

Years Ended December 31, 2016 and 2015

 

    Twelve Months   Twelve Months
    Ended   Ended
    December 31, 2016   December 31, 2015
         
Revenue   $

-

  $

-

         
General and administrative expenses:                
  Legal and professional fees     121,810       15,794  
  Other general and administrative     16,252       3,440  
    Total operating expenses     138,062       19,234  
    (Loss) from operations     (138,062 )     (19,234 )
                 
Other income (expense):                
  Interest income     776          
  Interest  expense     (2,116 )     (13,650 )
    (Loss) before taxes     (139,402 )     (32,884 )
                 
Provision (credit) for taxes on income     —         —    
    Net loss   $ (139,402 )   $ (32,884 )
                 
                 
 Basic earnings (loss) per common share   $ (0.14 )   $ (0.07 )
                 
Weighted average number of shares outstanding     1,015,286       478,742  

  

The accompanying notes are an integral part of these financial statements.

 

SPUTNIK ENTERPRISES, INC.

Statement of Changes in Stockholders’ Deficit

Years Ended December 31, 2016 and 2015 

 

                    Additional   Additional        
                    Paid In   Paid In        
    Preferred Stock   Common Stock   Capital-   Capital-   Accumulated   Total
    Shares   Amount   Shares   Amount   Preferred Stock   Common Stock   Deficit   Deficit
Balance, December 31, 2014     5,200     $ 52,000       295,286     $ 295     $ —       $ 1,984,653     $ (2,601,532 )   $ (564,584 )
                                                                 
Common stock issued for                                                                
debt extinguishment                     720,000       720               1,439,280               1,440,000  
                                                                 
Extinguishment of debt, related party                                             (852,137 )             (852,137 )
                                                                 
Net income (loss)                                                     (32,884 )     (32,884 )
                                                                 
Balance, December 31, 2015     5,200     $ 52,000       1,015,286     $ 1,015     $ —       $ 2,571,796     $ (2,634,416 )   $ (9,605 )
                                                                 
Preferred stock issued     50       500                       24,500                       25,000  
                                                                 
Net income (loss)                                                     (139,402 )     (139,402 )
                                                                 
Balance, December 31, 2016     5,250     $ 52,500     1,015,286   $ 1,015     $ 24,500     $ 2,571,796     $ (2,773,818 )   $ (124,007 )

 

The accompanying notes are an integral part of these financial statements.

 

 

SPUTNIK ENTERPRISES, INC.

Statements of Cash Flows

Years Ended December 31, 2016 and 2015        

 

    Twelve Months   Twelve Months
    Ended   Ended
    December 31, 2016   December 31, 2015
         
 Cash flows from operating activities:                
  Net (loss)   $ (139,402 )   $ (32,884 )
                 
  Change in current assets and liabilities:                
     Accounts payable and accrued expenses     40,685       17,715  
       Net cash flows used in operating activities     (98,717 )     (15,169 )
                 
 Cash flows from investing activities:                
    Loans to shareholder  and related party     (24,684 )     —    
                 
 Cash flows from financing activities:                
    Loans from shareholder  and related party     98,768       17,924  
    Loan repayments to shareholders and related parties     —         (2,500 )
    Preferred stock issuance     25,000       —    
       Net cash flows from investing activities     123,768       15,424  
                 
      Net increase in cash     367       255  
                 
 Cash, beginning of year     309       54  
 Cash, end of year   $ 676     $ 309  
                 
 Non- Cash Activities                
     Common stock issued for debt extinguishment   $ -     $ 1,440,000  
      Extinguishment of debt,  related party   $ -   $ (852,137
                 
 Supplemental cash flow disclosures:                
   Cash paid for interest   $ —       $ —    
   Cash paid for income taxes   $ —       $ —    

 

The accompanying notes are an integral part of these financial statements.

 

SPUTNIK ENTERPRISES, INC.

NOTES TO FINANCIAL STATEMENTS

 

 

NOTE 1 - ORGANIZATION

 

Sputnik Enterprises Inc. incorporated in the State of Delaware on September 27, 2001 under the name Sputnik, Inc. On February 10, 2005, we filed Articles of Conversion and new Articles of Incorporation in Nevada and became a Nevada corporation. From that time until February 29, 2008, the Company developed and marketed Wi-Fi software, services, and hardware for the public access wireless networking market.

 

On November 13, 2007 we formed a wholly owned subsidiary, Laika, Inc., and transferred all of our assets and liabilities to Laika.

 

On February 6, 2008, the Company amended its Articles of Incorporation to change the name of Sputnik, Inc. to Sputnik Enterprises, Inc. upon conclusion of the sale of the stock of Laika, Inc. to AstroChimp, Inc.

 

On February 29, 2008, we closed the sale of the stock of our wholly owned subsidiary, Laika, Inc. to AstroChimp, Inc. for cancellation of a loan of $65,000 from David LaDuke to us, leaving us as a shell company. AstroChimp is wholly owned by Mr. LaDuke. Subsequently AstroChimp, Inc. changed its name to Sputnik, Inc. and continues to own and operate its business as a private entity.

 

On September 30, 2015, Sport Venture Group, LLC and Windy River Group, LLC acquired 5,000 shares (2,500 shares each) of Convertible Preferred Stock of the Company from R. Thomas Kidd for $250,000. If converted, this would represent 94% of the issued and outstanding common stock of the Company, indicating a change in control of the Company. On June 15, 2016 Peter Grieve acquired 50 shares of Convertible Preferred Stock of the Company from the Company. Peter Grieve is the owner/manager of Windy River Group, LLC.

 

NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

 

Basis of Presentation

 

The Financial Statements and related disclosures have been prepared pursuant to the rules and regulations of the SEC. The Financial Statements have been prepared using the accrual basis of accounting in accordance with Generally Accepted Accounting Principles (“GAAP”) of the United States (See Note 3 regarding the assumption that the Company is a “going concern”).

 

Use of Estimates

 

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, the disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting periods. Actual results could differ from those estimates and assumptions.

 

Fiscal Year End

 

The Company elected December 31 as its fiscal year.

 

Cash and Cash Equivalents

 

The Company considers all highly liquid investments purchased with an original maturity of three months or less to be cash equivalents. Cash was $676 and $309 at December 31, 2016 and 2015, respectively and the Company had no cash equivalents for either of the periods ending December 31, 2016 and 2015.

 

 

Fair Value of Financial Instruments

 

The Company’s balance sheet includes certain financial instruments. The carrying amounts of current assets and current liabilities approximate their fair value because of the relatively short period of time between the origination of these instruments and their expected realization.

 

ASC 820, Fair Value Measurements and Disclosures, defines fair value as the exchange price that would be received for an asset or paid to transfer a liability (an exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date. ASC 820 also establishes a fair value hierarchy that distinguishes between (1) market participant assumptions developed based on market data obtained from independent sources (observable inputs) and (2) an entity’s own assumptions about market participant assumptions developed based on the best information available in the circumstances (unobservable inputs). The fair value hierarchy consists of three broad levels, which gives the highest priority to unadjusted quoted prices in active markets for identical assets or liabilities (Level 1) and the lowest priority to unobservable inputs (Level 3). The three levels of the fair value hierarchy are described below:

 

· Level 1 - Unadjusted quoted prices in active markets that are accessible at the measurement date for identical, unrestricted assets or liabilities
· Level 2 - Inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly or indirectly, including quoted prices for similar assets or liabilities in active markets; quoted prices for identical or similar assets or liabilities in markets that are not active; inputs other than quoted prices that are observable for the asset or liability (e.g., interest rates); and inputs that are derived principally from or corroborated by observable market data by correlation or other means.
· Level 3 - Inputs that are both significant to the fair value measurement and unobservable.

Fair value estimates discussed herein are based upon certain market assumptions and pertinent information available to management as of December 31, 2016. The respective carrying value of certain on-balance-sheet financial instruments approximated their fair values due to the short-term nature of these instruments.

 

Income Taxes

 

The Company accounts for income taxes under ASC 740 Income Taxes.  Under the asset and liability method of ASC 740, deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial statements carrying amounts of existing assets and liabilities and their respective tax bases.  Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled.  The effect on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period the enactment occurs.  A valuation allowance is provided for certain deferred tax assets if it is more likely than not that the Company will not realize tax assets through future operations.  No deferred tax assets or liabilities were recognized as of December 31, 2016 or 2015.

 

 

Basic and Diluted Net Loss per Share

 

The Company computes basic and diluted earnings per share amounts in accordance with ASC Topic 260, Earnings per Share. Basic earnings per share is computed by dividing net income (loss) available to common shareholders by the weighted average number of common shares outstanding during the reporting period. Diluted earnings per share reflects the potential dilution that could occur if stock options and other commitments to issue common stock were exercised or equity awards vest resulting in the issuance of common stock that could share in the earnings of the Company. 

 

The Company has incurred a net operating loss for December 31, 2016 and 2015, and dilutive earnings per share would be anti-dilutive, therefore, dilutive earnings per share have not been presented. There are no options or warrants outstanding. The Company has common stock equivalents, in the form or convertible preferred stock, series A. Common stock equivalents were 52,500,000 and 52,000,000 for the years ending December 31, 2016 and December 31, 2015, respectively. There are only 50,000,000 shares of common stock authorized. It is the current intention of the Company following the filing of this report on Form 10-K and thereafter when the Company becomes current in all SEC filings to file an Information Statement on Schedule 14C to, among other things, increase the number of authorized shares of Common Stock to one billion shares.

 

Commitments and Contingencies

 

The Company follows ASC 450, Loss Contingencies, to report accounting for contingencies. Liabilities for loss contingencies arising from claims, assessments, litigation, fines and penalties and other sources are recorded when it is probable that a liability has been incurred and the amount of the assessment can be reasonably estimated. There were no commitments or contingencies as of December 31, 2016 and 2015.

 

Related Parties

 

The Company follows subtopic ASC 850, Related Party Disclosure, for the identification of related parties and disclosure of related party transactions. See Note 5 for related party transactions.

 

Cash Flows Reporting

 

The Company follows ASC 230, Statement of Cash Flows, for cash flows reporting, classifies cash receipts and payments according to whether they stem from operating, investing, or financing activities and provides definitions of each category, and uses the indirect or reconciliation method (“Indirect method”) as defined by ASC 230, Statement of Cash Flows, to report net cash flow from operating activities by adjusting net income to reconcile it to net cash flow from operating activities by removing the effects of (a) all deferrals of past operating cash receipts and payments and all accruals of expected future operating cash receipts and payments and (b) all items that are included in net income that do not affect operating cash receipts and payments. The Company reports the reporting currency equivalent of foreign currency cash flows, using the current exchange rate at the time of the cash flows and the effect of exchange rate changes on cash held in foreign currencies is reported as a separate item in the reconciliation of beginning and ending balances of cash and cash equivalents and separately provides information about investing and financing activities not resulting in cash receipts or payments in the period.

 

Share-based Expense

 

ASC 718, Compensation – Stock Compensation, prescribes accounting and reporting standards for all share-based payment transactions in which employee services are acquired. Transactions include incurring liabilities, or issuing or offering to issue shares, options, and other equity instruments such as employee stock ownership plans and stock appreciation rights. Share-based payments to employees, including grants of employee stock options, are recognized as compensation expense in the financial statements based on their fair values. That expense is recognized over the period during which an employee is required to provide services in exchange for the award, known as the requisite service period (usually the vesting period).

 

 

The Company accounts for stock-based compensation issued to non-employees and consultants in accordance with the provisions of ASC 505-50, Equity – Based Payments to Non-Employees.  Measurement of share-based payment transactions with non-employees is based on the fair value of whichever is more reliably measurable:  (a) the goods or services received; or (b) the equity instruments issued.  The fair value of the share-based payment transaction is determined at the earlier of performance commitment date or performance completion date.  

 

There was no share-based expense for the years ending December 31, 2016 and 2015.

 

RECENT ACCOUNTING PRONOUNCEMENTS

 

From time to time, new accounting pronouncements issued by the FASB or other standard setting bodies are adopted by the Company as of the specified effective date. Unless otherwise discussed, we believe that the impact of recently issued standards that are not yet effective will not have a material impact on our financial position or results of operations upon adoption.

 

In May 2014, the Financial Accounting Standards Board, or FASB, issued Accounting Standards Update No. 2014-09, Revenue from Contracts with Customers (Topic 606) , or ASU 606. ASU 606 provides guidance outlining a single comprehensive model for entities to use in accounting for revenue arising from contracts with customers that supersedes most current revenue recognition guidance. This guidance requires us to recognize revenue when we transfer promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. The original effective date of the guidance would have required us to adopt at the beginning of our first quarter of fiscal 2017; however, the FASB approved an optional one-year deferral of the effective date. Additionally, the new guidance requires enhanced disclosures, including revenue recognition policies to identify performance obligations to customers and significant judgments in measurement and recognition. The new guidance may be applied retrospectively to each prior period presented or retrospectively with the cumulative effect recognized as of the date of adoption.

 

In June 2014, the Financial Accounting Standards Board issued Accounting Standards Update No. 2014-10, which eliminated certain financial reporting requirements of companies previously identified as "Development Stage Entities" (Topic 915). The amendments in this ASU simplify accounting guidance by removing all incremental financial reporting requirements for development stage entities. The amendments also reduce data maintenance and, for those entities subject to audit, audit costs by eliminating the requirement for development stage entities to present inception-to-date information in the statements of income, cash flows, and shareholder equity. Early application of each of the amendments is permitted for any annual reporting period or interim period for which the entity's financial statements have not yet been issued (public business entities) or made available for issuance (other entities). Upon adoption, entities will no longer present or disclose any information required by Topic 915. The Company has adopted this standard.

 

In June 2014, FASB issued Accounting Standards Update (ASU) No. 2014-12 Compensation — Stock Compensation (Topic 718), Accounting for Share-Based Payments When the Terms of an Award Provide That a Performance Target Could Be Achieved after the Requisite Service Period. A performance target in a share-based payment that affects vesting and that could be achieved after the requisite service period should be accounted for as a performance condition under Accounting Standards Codification (ASC) 718, Compensation — Stock Compensation. As a result, the target is not reflected in the estimation of the award's grant date fair value. Compensation cost would be recognized over the required service period, if it is probable that the performance condition will be achieved. The guidance is effective for annual periods beginning after 15 December 2015 and interim periods within those annual periods. Early adoption is permitted. Management has reviewed the ASU and believes that they currently account for these awards in a manner consistent with the new guidance, therefore there is no anticipation of any effect to the financial statements.

 

 

In August 2014, FASB issued Accounting Standards Update (ASU) No. 2014-15 Preparation of Financial Statements – Going Concern (Subtopic 205-40), Disclosure of Uncertainties about an Entity's Ability to Continue as a Going Concern. Under generally accepted accounting principles (GAAP), continuation of a reporting entity as a going concern is presumed as the basis for preparing financial statements unless and until the entity's liquidation becomes imminent. Preparation of financial statements under this presumption is commonly referred to as the going concern basis of accounting. If and when an entity's liquidation becomes imminent, financial statements should be prepared under the liquidation basis of accounting in accordance with Subtopic 205-30, Presentation of Financial Statements—Liquidation Basis of Accounting. Even when an entity's liquidation is not imminent, there may be conditions or events that raise substantial doubt about the entity's ability to continue as a going concern. In those situations, financial statements should continue to be prepared under the going concern basis of accounting, but the amendments in this Update should be followed to determine whether to disclose information about the relevant conditions and events. The amendments in this Update are effective for the annual period ending after December 15, 2016, and for annual periods and interim periods thereafter. Early application is permitted. The Company will evaluate the going concern considerations in this ASU however, at the current period, management does not believe that it has met conditions which would subject these financial statements for additional disclosure.

 

In August 2014, FASB issued ASU 2014-15, Disclosure of Uncertainties about an Entity’s Ability to Continue as a Going Concern, or ASU 2014-15. ASU 2014-15 explicitly requires a company’s management to assess an entity’s ability to continue as a going concern, and to provide related footnote disclosures in certain circumstances. The new standard will be effective in the first annual period ending after December 15, 2016, although early application is permitted. We do not expect the adoption of this standard to have a material impact on our statements of financial position, results of operations or cash flows.

 

In April 2015, FASB issued ASU No. 2015-03, Interest – Imputation of Interest (Subtopic 835-30): Simplifying the presentation of Debt Issuance Costs, to reduce the complexity of having different balance sheet presentation requirements for debt issuance costs and debt discounts and premiums. The guidance requires debt issuance costs related to a recognized debt liability be reported on the balance sheet as a direct deduction from the carrying amount of that debt liability. ASU 2015-03 is effective for public companies for annual reporting periods beginning after December 15, 2015, and interim periods within those fiscal years. The Company has adopted the amendments of ASU 2015-03 effective January 1, 2016.

 

In November 2015, FASB issued ASU No. 2015-17, Balance Sheet Classification of Deferred Taxes. ASU 2015-17 simplifies the presentation of deferred taxes by requiring deferred tax assets and liabilities be classified as noncurrent on the balance sheet. ASU 2015-17 is effective for public companies for annual reporting periods beginning after December 15, 2016, and interim periods within those fiscal years. The guidance may be adopted prospectively or retrospectively and early adoption is permitted. We believe the adoption of this standard will have no material impact on our statements of financial position, results of operations or cash flows.

 

In February 2016, FASB issued ASU No. 2016-02, Leases (Topic 842). The core principle of Topic 842 is that a lessee should recognize the assets and liabilities that arise from leases. ASU 2016-02 is effective for public companies for annual reporting periods beginning after December 15, 2018, and interim periods within those fiscal years. The guidance may be adopted prospectively or retrospectively and early adoption is permitted. The Company is currently assessing the impact the adoption of ASU 2016-02 will have on its financial statements.

 

NOTE 3 - GOING CONCERN

 

The Company incurred a net loss of $139,402 during the year ended December 31, 2016 and had net cash used in operating activities of $98,717 for the same period. Additionally, the Company had an accumulated deficit of $2,773,818 at December 31, 2016. In view of these matters, the Company's ability to continue as a going concern is dependent upon the Company's ability to achieve a level of profitability or to obtain adequate financing through the issuance of debt or equity in order to finance its operations. Upon securing an operating entity, through merger, Management intends to raise additional funds by way of a public or private offering. Management believes that the actions presently being taken to further implement its business plan and generate revenues provide the opportunity for the Company to continue as a going concern. The financial statements of the Company do not include any adjustments relating to the recoverability and classification of recorded assets, or the amounts and classifications of liabilities that might be necessary should the Company be unable to continue as a going concern.

 

 

While the Company is attempting to commence operations and produce revenues, the Company’s cash position may not be significant enough to support the Company’s daily operations. While the Company believes in the viability of its strategy to increase revenues and in its ability to raise additional funds, there can be no assurances to that effect. The ability of the Company to continue as a going concern is dependent upon the Company’s ability to further implement its business plan and generate revenues.

 

NOTE 4 – LOANS TO RELATED PARTY

 

Summary of loans to related party (Sport Venture Group, LLC) are:

 

    December 31,   December 31,
Date Issued  

2016

 

2015

May 27, 2016   $ 6,500     $ —    
June 27, 2016     4,000       —    
July 8, 2016     2,000       —    
July 20, 2016     300       —    
December 9, 2016     11,884       —    
    $ 24,684     $ —    

 

These notes bear interest at 10% with maturity dates one year from issuance. If notes are paid before maturity, a minimum interest of 10% is due at that time. Interest of $406 was accrued in 2016. The assets of the business, secure these notes second to any credit facility entered into by Sport Venture Group, LLC.

 

NOTE 5 – NOTES PAYABLE, RELATED PARTY

 

Summary of notes payable, related party (Windy River Group, LLC) are:          

 

    December 31,   December 31,
Date Issued  

2016

 

2015

May 26, 2016   $ 25,000     $ —    
November 29, 2016     50,000       —    
December 9, 2016     23,768       —    
    $ 98,768     $ —    

 

These notes bear interest at 10% with maturity dates one year from issuance. If notes are paid before maturity, a minimum interest of 10% is due at that time. Interest of $2,116 was accrued in 2016. The assets of the business secure these notes, second to any credit facility entered into by the Company.

 

On September 30, 2015, effective with a change in control of the Company on the same date, the Company issued 720,000 shares of common stock, valued at $1,440,000, in exchange for the extinguishment of $525,000 in notes payable, $34,889 in related interest, and $27,974 owed to Mr. Kidd, payable on demand (see Note 6). The Company has relied upon guidance provided in ASC 470-50-40, which states that entities must determine whether the difference between the fair value of the equity issued and the carrying value of the debt extinguished should be recognized a gain or loss or characterized as a capital transaction when with a related party. The Company issued the shares to its prior CEO and controlling shareholder and therefore the Company has recognized a decrease of $852,137 to additional paid in capital for the difference.

 

 

NOTE 6 - RELATED PARTY TRANSACTIONS

 

Loans to related party

 

During 2016, Sport Venture Group, LLC, was provided funding by the Company in the form of loans totaling $24,684 (see Note 4). At December 31, 2016 Sport Venture Group, LLC owns 2,500 shares of Convertible Preferred Stock of the Company. If converted, this would represent 47% of the issued and outstanding common stock of the Company.

 

Notes payable and Convertible Preferred Stock

 

During 2016, Windy River Group, LLC, provided funding to the Company in the form of notes payable totaling $98,768 (see Note 5) and Peter Grieve purchased 50 shares of Convertible Preferred Stock for $25,000. Peter Grieve is the owner/manager of Windy River Group, LLC. Mr. Grieve holds voting and investment power over any pecuniary interests in shares of the Company held by Windy River Group, LLC. At December 31, 2016 Windy River Group, LLC and Peter Grieve own 2,550 shares of Convertible Preferred Stock of the Company. If converted, this would represent 48% of the issued and outstanding common stock of the Company.

 

On September 30, 2015, effective with a change in control of the Company on the same date, the Company issued 720,000 shares of common stock, valued at $1,440,000, in exchange for the extinguishment of $525,000 in notes payable, $34,889 in related interest, and $26,474 owed to Mr. Kidd, payable on demand (see Note 5). Prior to January 20, 2014, Mr. Kidd was CEO and a Director of the Company and controlling shareholder. The Company has relied upon guidance provided in ASC 470-50-40, which states that entities must determine whether the difference between the fair value of the equity issued and the carrying value of the debt extinguished should be recognized a gain or loss or characterized as a capital transaction when with a related party. The Company issued the shares to its prior CEO and controlling shareholder and therefore the Company has recognized a decrease of $852,137 to additional paid in capital for the difference.

 

Severance and Release Agreements

 

Pursuant to a Release Agreement made effective September 29, 2015, and in connection with a change in control of the Company, the Company was released and forever discharged from any and all manner of action or actions against the Company in connection with any and all agreements entered into by and between the Company and R. Thomas Kidd on January 20, 2014.

 

Effective January 20, 2014, Mr. Kidd retired from his position with the Company, thereby terminating his Employment Agreement. For and as consideration of Kidd's resignation as CEO and Director and retirement from services to the Company, the Company agreed to compensate Mr. Kidd in the form of a severance package.

 

Upon execution of the agreement, and receipt of all documentation, Kidd shall immediately do the following:

 

  · Agree to return 5,000 shares of Convertible preferred stock of the Company to Company for cancelation upon closing of merger transaction.
  · Resign all positions, as applicable, with the Company.

 

On January 20, 2014, the Company entered into a consulting agreement with their former executive, R. Thomas Kidd (“Consultant”), effective upon the completion of a merger or acquisition. Under the agreement, the Company shall compensate Consultant in the form of two million (2,000,000) shares of unrestricted common stock of the Company with issuance to occur in installments of 250,000 shares per month for a period of 8 months. The Consultant shall be entitled to receive the shares as earned and in the event of termination of the agreement, Company shall be obligated to continue the issuance of shares until the entire 2 million shares are issued to Consultant.

 

 

Pursuant to a Release Agreement made effective September 29, 2015, and in connection with a change in control of the Company, the Company was released and forever discharged from any and all manner of action or actions against the Company in connection with any and all agreements entered into by and between the Company and R. Thomas Kidd.

 

Other

 

The Company does not own or lease property or lease office space. The office space used by the Company was arranged by the Officers of the Company to use at no charge.

 

The amounts and terms of the above transactions may not necessarily be indicative of the amounts and terms that would have been incurred had comparable transactions been entered into with independent third parties.

 

NOTE 7– EQUITY

 

On February 14, 2013, the Company and Dutchess Opportunity Fund, II, LP (“Duchess”) entered into an Investment Agreement and a Registration Rights Agreement, which provides for the investment by Dutchess of up to $25 million over a period of 36 months. Under the terms of the Investment Agreement and Registration Rights Agreement, Dutchess will purchase common stock of the Company, subject to and wholly conditioned upon the Company filing an S-1 registration statement to register the shares acquired by Dutchess and the registration statement of the shares declared effective by the Securities and Exchange Commission. The Investment Agreement sets forth the terms and conditions under which Dutchess will purchase the common stock of the Issuer and other material conditions to the agreement between the parties. As of December 31, 2016, there has been no funding under the agreement.

 

Common Stock

 

The Company has authority to issue fifty million (50,000,000) common with a par value of $.001. The Company intends to issue additional shares in an effort to fund its operations.

 

No holder of shares of stock of any class is entitled, as a matter of right, to subscribe for or purchase or receive any part of any new or additional issue of shares of stock of any class, or of securities convertible into shares of stock of any class, whether now hereafter authorized or whether issued for money, for consideration other than money, or by way of dividend.

 

On January 20, 2014, the Company entered into a consulting agreement, effective upon completion of a merger or acquisition, with their former executive, R. Thomas Kidd. Under the agreement, the Company shall compensate Consultant in the form of two million (2,000,000) shares of unrestricted common stock of the Company with issuance to occur in installments of 250,000 shares per month for a period of 8 months. Under contractual agreement, the shares are to be issued as unrestricted shares. Pursuant to a Release Agreement made effective September 29, 2015, and in connection with a change in control of the Company, the Company was released and forever discharged from all agreements entered into by and between the Company and R. Thomas Kidd, thereby nullifying this agreement.

 

On September 29, 2015, the Company issued 720,000 shares of common stock in exchange for the release of debt and other agreements entered into with R. Thomas Kidd, the Company's former Chief Executive Officer and Director. The excess of the fair value of consideration paid ($1,440,000) over the debt and accrued interest extinguished ($552,974) was $852,137 and was recorded as a decrease to additional paid in capital on the extinguishment of debt to a related party pursuant to ASC 470-50-40. (see Note 6.)

 

Total common shares issued and outstanding at both December 31, 2016 and 2015 were 1,015,286.

 

 

If the Series A Convertible Preferred Stock was converted into common shares that would add additional shares of common stock of 52,500,000 as of December 31, 2016, more than the 50,000,000 shares of common stock currently authorized. It is the current intention of the Company following the filing of this report on Form 10-K and thereafter when the Company becomes current in all SEC filings to file an Information Statement on Schedule 14C to, among other things, increase the number of authorized shares of Common Stock to one billion shares.

 

Preferred stock

 

The Company amended its Articles of Incorporation in May 2013 and subsequently has authority to issue ten million (10,000,000) Series A Convertible Preferred with a par value of $10.00, of which 5,250 shares have been issued as of December 31, 2016. This class of stock may be convertible into common shares at the rate of one share of Series A Convertible Preferred for 1,000 shares of common. There are no liquidation preferences over common shares, but the Series A Convertible Preferred may be voted as if converted and are entitled to dividend treatment as if converted to common. Series A Convertible Preferred may be converted to common shares at any time after one year from the date of issuance at the option of the holder.

 

On September 30, 2015, Sport Venture Group, LLC and Windy River Group, LLC acquired 5,000 shares (2,500 shares each) of Convertible Preferred Stock of the Company from R. Thomas Kidd for $250,000. If converted, this would represent 94.26% of the issued and outstanding common stock of the Company, indicating a change in control of the Company.

 

On December 22, 2015, the Company filed an Amendment to the Certificate of Designation that modified the rights of the holders of Series A Convertible Preferred Stock by changing the conversion ratio to 10,000 shares of common stock for one share of Series A Convertible Preferred Stock and eliminating any holding requirement before conversion.

 

On June 15, 2016, Peter Grieve purchased 50 shares of Convertible Preferred Stock for $25,000. Peter Grieve is the owner/manager of Windy River Group, LLC. Mr. Grieve holds voting and investment power over any pecuniary interests in shares of the Company held by Windy River Group, LLC.

 

Sport Venture Group, LLC

 

Sport Venture Group, LLC was incorporated in the State of South Carolina. The principal business of SVG is that of a sport investment and holding company that seeks to invest, hold and manage its various multisport interests. Ron Konersmann is the Owner/Manager of Sport Venture Group, LLC. Mr. Konersmann holds voting and investment power over any pecuniary interests in shares of the Company held by Sport Venture Group, LLC.

 

Windy River Group, LLC

 

Windy River Group, LLC was incorporated in the State of Massachusetts. The principal business of WRG is that of a private investment firm with interests in international football, banking, wealth management, and technology. Peter Grieve is the owner/manager of Windy River Group, LLC. Mr. Grieve holds voting and investment power over any pecuniary interests in shares of the Company held by WRG.

 

Total preferred shares, series A, issued and outstanding as of December 31, 2016 and December 31, 2015 were 5,250 and 5,200, respectively.

 

 

NOTE 8 - INCOME TAXES

 

The Company uses the liability method, where deferred tax assets and liabilities are determined based on the expected future tax consequences of temporary differences between the carrying amounts of assets and liabilities for financial and income tax reporting purposes. During fiscal 2016 and 2015, the Company incurred a net loss and therefore has no tax liability. The net deferred tax asset generated by the loss carry-forward has been fully reserved. The cumulative net operating loss carry-forward was approximately $2,774,000 and $2,634,000 at December 31, 2016 and 2015, respectively, and will begin to expire in the year 2025.

 

At December 31, 2016 and 2015, deferred tax assets at the statutory rate consisted of the following:

 

Deferred tax assets   2016   2015
Tax benefit   $ 943,098     $ 895,701  
Less: valuation allowance     (943,098 )     (895,701 )
Net deferred tax asset   $ —       $ —    

 

NOTE 9 – COMMITMENTS AND CONTINGENCIES

 

Some of the officers and directors of the Company are involved in other business activities and may in the future, become involved in other business opportunities that become available. They may face a conflict in selecting between the Company and other business interests. The Company has not formulated a policy for the resolution of such conflicts.

 

In the normal course of business, the Company may become a party to litigation matters involving claims against the Company.   The Company's management is unaware of any pending or threatened assertions and there are no current matters that would have a material effect on the Company’s financial position or results of operations.

 

The Company’s operations are subject to significant risks and uncertainties including financial, operational and regulatory risks, including the potential risk of business failure.

 

NOTE 10 - DEFINITIVE AGREEMENT FOR REVERSE MERGER TRANSACTION

 

An Agreement was made on February 5, 2016 between FV Corporation ("FV" or "Seller") and Sputnik Enterprises, Inc. ("SPNI" or "Buyer"). The Agreement provides that, subject to all the terms and conditions of this Agreement, at the Closing, FV agrees to receive from SPNI, and SPNI agrees to issue to the shareholders of the Seller (each, a "Shareholder") an aggregate of 45,170,085 shares of Common Stock ("SPNI Common Stock") and such number of shares of Series A Convertible Preferred Stock that convert into an additional 45,170,085 shares of Common Stock of SPNI ("SPNI Preferred Stock") (the SPNI Common Stock and the SPNI Preferred Stock collectively, the "Share Consideration") in exchange for the transfer of all of the issued and outstanding shares of the Common Stock of FV ("FV Shareholder's Shares") to SPNI. Each FV Shareholder's Share that is issued and outstanding immediately before the Closing shall entitle the holder thereof to receive one share of SPNI Common Stock and 0.0001 shares of SPNI Preferred Stock which equates to one share of common stock (together, the "Exchange Ratio"), such that when all shares of Common Stock and SPNI Preferred Stock have been issued under this Agreement and all shares Preferred Stock issued under this Agreement have been converted to common stock, an aggregate of 90,340,170 shares of SPNI Common Stock shall have been issued to FV's Shareholders under this Agreement. Notwithstanding the foregoing, prior to Closing, the parties shall adjust the number of FV Shareholder's Shares to be transferred to SPNI to such number of shares of FV Common Stock as is actually issued and outstanding as of the Closing Date and the aggregate number shares of SPNI Common Stock and SPNI Preferred Stock to be issued to the FV Shareholders shall be adjusted accordingly pursuant to the Exchange Ratio.

  

Sport Venture Group, LLC and Windy River Group, LLC own 62% and 3%, respectively of FV as of December 31, 2016.

 

Closing of the Agreement is contingent upon a number of terms and conditions described in the Agreement, including FV securing shareholder approval as required under the laws of South Carolina and completion of an audit of FV Corporation. As of the filing of this report, shareholder approval has been acquired by FV and the Company anticipates the conclusion of FV’s audit on or before June 30, 2017.

 

 

Item 9. Changes in and Disagreements with Accountants on Accounting and Financial Disclosure.

 

None.

 

Item 9A. Controls and Procedures.

 

Evaluation of Disclosure Controls and Procedures

 

The Company's Chief Executive Officer/Chief Financial Officer has evaluated the effectiveness of the Company's disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e) under the Exchange Act) as of December 31, 2016. Based upon such evaluation, the Chief Executive Officer/Chief Financial Officer has concluded that, as of December 31, 2016, the Company's disclosure controls and procedures were not effective. This conclusion by the Company's Chief Executive Officer/Chief Financial Officer does not relate to reporting periods after December 31, 2016.

 

Management's Report on Internal Control over Financial Reporting

 

Under the supervision and with the participation of our management, including our Chief Executive Officer/Chief Financial Officer, we conducted an evaluation of the effectiveness of our internal control over financial reporting as of December 31, 2016 based on the framework stated by the Committee of Sponsoring Organizations of the Treadway Commission. Furthermore, due to our financial situation, we will be implementing further internal controls as we become operative in order to be fully compliant with the standards set by the Committee of Sponsoring Organizations of the Treadway Commission.

 

Our management is responsible for establishing and maintaining adequate internal control over financial reporting, as such term is defined in Rules 13a-15(f) and 15d-15(f) of the Exchange Act. Our internal control system was designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes, in accordance with generally accepted accounting principles. Because of inherent limitations, a system of 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 due to change in conditions, or that the degree of compliance with the policies or procedures may deteriorate.

 

Based on its evaluation as of December 31, 2016, our management concluded that our internal controls over financial reporting were not effective as of December 31, 2016 due to the material weaknesses set forth below. A material weakness is a deficiency, or a combination of control deficiencies, in internal control over financial reporting such that there is a reasonable possibility that a material misstatement of the Company's annual or interim financial statements will not be prevented or detected on a timely basis.

 

The material weaknesses relates to the following:

 

1. As of December 31, 2016, the Company did not maintain effective controls over the control environment. Specifically, the Company has fully not developed its accounting policies and procedures and effectively communicated those to its employees. This has resulted in inconsistent practices.  Further, the Board of Directors does not currently have any independent members and no director qualifies as an audit committee financial expert as defined in Item 407(d)(5)(ii) of Regulation S-K. Since these entity level programs have a pervasive effect across the organization, management has determined that these circumstances constitute a material weakness.

 

2. As of December 31, 2016, the Company did not maintain effective controls over financial statement disclosure. Specifically, controls were not designed and in place to ensure that all disclosures required were originally addressed in our financial statements.   Accordingly, management has determined that this control deficiency constitutes a material weakness.

 

 

3. As of December 31, 2016, management is dominated by a single individual serving as both our CEO and CFO, resulting in inadequate segregation of duties consistent with control objectives and ineffective oversight of the entity’s financial reporting and internal control by those charged with governance.

 

Because of these material weaknesses, management has concluded that the Company did not maintain effective internal control over financial reporting as of December 31, 2016, based on the criteria established in "Internal Control-Integrated Framework" issued by the COSO.

 

Change In Internal Control Over Financial Reporting

 

There were no changes in our internal control over financial reporting that occurred during our last fiscal year that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

 

Item 9B. Other Information.

 

None.

 

PART III

 

Item 10. Directors, Executive Officers, and Corporate Governance

 

(a)  Identification of Directors and Executive Officers.  The following table sets forth certain information regarding the Company’s directors and executive officers:

 

Name   Age   Position
         
Anthony Gebbia   47   Director, Chief Executive Officer, President, Chief Financial Officer and Secretary

 

The following is information on the business experience of each director and officer.

 

Mr. Gebbia, age 47, is now and will continue to be our sole officer and director. On August 15, 2011 he joined Armada Sports and Entertainment as Chief Operating Officer and currently holds the position of Chairman & CEO. From May 2009 to March 2010, he was General Manager of T&B Equipment Company, a company in the business of Bleachers, Scaffolding, and Tent Flooring. From February 1988 to May 2009, he was Event Manager/Event Director for Walt Disney Company. Mr. Gebbia brings to the board a diverse career, most notably, gaining 21 years of experience at The Walt Disney Company, a world leader in family and sports entertainment. During his tenure at Disney, Mr. Gebbia was immersed in the Disney culture of Guest service, creativity and innovation and his experience includes transportation operations, theme park operations, administration, merchandise operations, finance, business development, international marketing, program development, telecast operations, domestic marketing and alliance marketing. Mr. Gebbia created the Logistics Operation for Disney’s Wide World of Sports (now ESPN Wide World of Sports) and led the logistics teams for such events as the Walt Disney World Golf Classic and The Walt Disney World Marathon. For eight years of his Disney career, Mr. Gebbia developed and oversaw signature events with multi-million dollar operating budgets, leading the project team of members from Finance, Entertainment, Operations, Talent Relations, Security, Legal, Business Development, Merchandise and Food and Beverage. Mr. Gebbia’s other career experience includes convention sales and operations, restaurant operations and project management on such projects as the Doha Tribeca Film Festival, Doha, Qatar and on the build-out of several PGA Tour events. Mr. Gebbia is currently on the Board of Directors of the non-profit Kids Beating Cancer and has been a member of the Board of Directors of the Woman’s Professional Billiards Association.

 

 

(b)  Significant Employees.

 

As of the date hereof, the Company has no significant employees.

 

(c)  Family Relationships.

 

There are no family relationships among directors, executive officers, or persons nominated or chosen by the issuer to become directors or executive officers.

 

(d)   Involvement in Certain Legal Proceedings.

 

There have been no events under any bankruptcy act, no criminal proceedings and no judgments, injunctions, orders or decrees material to the evaluation of the ability and integrity of any director, executive officer, promoter or control person of Registrant during the past five years.

 

Compliance with Section 16(a) of the Exchange Act

 

Section 16(a) of the Exchange Act requires the Company’s directors and officers, and persons who beneficially own more than 10% of a registered class of the Company’s equity securities, to file reports of beneficial ownership and changes in beneficial ownership of the Company’s securities with the SEC on Forms 3, 4 and 5. Officers, directors and greater than 10% stockholders are required by SEC regulation to furnish the Company with copies of all Section 16(a) forms they file.

 

Based solely on the Company’s review of the copies of the forms received by it during the fiscal year ended December 31, 2015 and written representations that no other reports were required, the Company believes that no person(s), who at any time during such fiscal year, was a director, officer or beneficial owner of more than 10% of the Company’s common stock failed to comply with all Section 16(a) filing requirements during such fiscal years.

 

Code of Ethics

 

The Company does not have a code of ethics for our principal executive and financial officers. The Company's management intends to promote honest and ethical conduct, full and fair disclosure in our reports to the SEC, and compliance with applicable governmental laws and regulations

 

Nominating Committee

 

The Company has not adopted any procedures by which security holders may recommend nominees to its Board of Directors.

 

Audit Committee

 

The Board of Directors acts as the audit committee. The Company does not have a qualified financial expert at this time because it has not been able to hire a qualified candidate. Further, the Company believes that it has inadequate financial resources at this time to hire such an expert.  The Company intends to continue to search for a qualified individual for hire.

 

 

Item 11. Executive Compensation-

 

Summary of Cash and Certain Other Compensation

 

The named executive officers received the following compensation from the Company during the fiscal years ended December 31, 2016 and December 31, 2015.

Name and principal position Year Salary
($)
Bonus
($)
Stock awards
($)
Option awards
($)
Non-equity
incentive plan compensation
($)
Change in pension value and nonqualified deferred compensation earnings
($)
All other compensation
($)
Total
($)
Anthony Gebbia,  CEO and CFO, sole Director

2016

2015

0

0

0

0

0

0

0

0

0

0

0

0

0

0

0

0

                   

 

Director Compensation

 

The Company does not currently pay and has not paid in fiscal years ended December 31, 2016 and December 31, 2015 any cash fees to our directors, nor does the Company pay directors’ expenses in attending board meetings.

 

Item 12. Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters.

 

(a) The following tables set forth certain information as of December 31, 2016, regarding (i) each person known by the Company to be the beneficial owner of more than 5% of the outstanding shares of Common Stock, (ii) each director, nominee and executive officer of the Company and (iii) all officers and directors as a group.

 

 

 

 

 

 

As Converted

 

 

Total Common and As

 

 

 

Common Shares

 

 

Preferred Shares

 

 

Converted Shares

 

Names and Address of Beneficial Owner

 

Number

 

 

Percent

 

 

Number

 

 

Percent

 

 

Number

 

 

Percent

 

Sport Venture Group LLC [1]

 

 

0

 

 

 

0 %

 

 

25,000,000

 

 

 

48 %

 

 

25,000,000

 

 

 

96 %

Windy River Group LLC [2]

 

 

0

 

 

 

0 %

 

 

25,500,000

 

 

 

49 %

 

 

25,000,000

 

 

 

96 %

Anthony Gebbia [3]

 

 

0

 

 

 

0 %

 

 

2,000,000

 

 

 

4 %

 

 

2,000,000

 

 

 

66 %

Thomas Kidd [4]

 

 

900,000

 

 

 

89 %

 

 

0

 

 

 

0 %

 

 

900,000

 

 

 

89 %

All Directors and Officers as a Group [1 person]

 

 

0

 

 

 

0 %

 

 

2,000,000

 

 

 

4 %

 

 

2,000,000

 

 

 

66 %

_____________ 

[1] Sport Venture Group LLC is a wholly-owned subsidiary of The O’Lynch Family Revocable Living Trust with equal beneficial ownership by fifteen descendants of Mr. Jake Lynch. The descendants of Mr. Jake Lynch may be deemed to share beneficial ownership of the shares held by Sport Venture Group, LLC as a result of their equal beneficial ownership in The O’Lynch Family Revocable Living Trust. Ron Konersmann is the Trustee of The O’Lynch Family Revocable Living Trust and Chairman of Sport Venture Group, LLC and holds sole voting and investment power over any pecuniary interests in shares of the Company held by Sport Venture Group, LLC which includes 2,500 shares of Series A convertible preferred stock of the Registrant, which is currently convertible into 25,000,000 shares of common stock. The percent ownership is calculated by dividing the Total Common and As Converted Shares for Sport Venture Group LLC by the sum of the total common shares outstanding (1,015,286) and the Total Common and As Converted Shares for Sport Venture Group LLC [1,015,286 plus 25,000,000]. The business address for each of the entities identified in this footnote is 3022 Morgans Point Rd, Suite 196, Mount Pleasant, SC 29466.

 

[2] Peter Grieve as he owner/manager of Windy River Group, LLC. Mr. Grieve holds voting and investment power over any pecuniary interests in shares of the Company held by Windy River Group, LLC. Windy River Group, LLC is the beneficial owner of 2,550 shares of Series A convertible preferred stock of the Registrant, which is currently convertible into 25,500,000 shares of common stock. The percent ownership is calculated by dividing the Total Common and As Converted Shares for Windy River Group, LLC by the sum of the total common shares outstanding (1,015,286) and the Total Common and As Converted Shares for Windy River Group, LLC [1,015,286 plus 25,500,000]. The business address of Windy River Group is 10 State Street, Newburyport, MA 01950.

 

[3] Anthony Gebbia is the Sole Director, Chief Executive Officer, President, Chief Financial Officer and Secretary of the Registrant. Mr. Gebbia is the beneficial owner of 200 shares of Series A convertible preferred stock of the Registrant, which is currently convertible into 2,000,000 shares of common stock. The percent ownership is calculated by dividing the Total Common and As Converted Shares for Mr. Gebbia by the sum of the total common shares outstanding (1,015,286) and the Total Common and As Converted Shares [1,015,286 plus 2,000,000] for Mr. Gebbia.

 

[4] Roy Thomas Kidd was the former Chief Executive Officer of the Registrant. Mr. Kidd is the beneficial owner of 900,000 shares of common stock. The percent ownership is calculated by dividing the 900,000 shares of Common Stock by the total common shares outstanding (1,015,286).

 

 

Item 13. Certain Relationships and Related Transactions and Director Independence.

 

During the year ending December 31, 2016, the Company has not entered into any material transactions with any director, executive officer, promoter, or beneficial owner of five percent or more of our common stock, or family members of such persons except as follows:

 

Loans to related party

 

During 2016, Sport Venture Group, LLC, was provided funding by the Company in the form of loans totaling $24,684 (see Note 4). At December 31, 2016 Sport Venture Group, LLC owns 2,500 shares of Convertible Preferred Stock of the Company. If converted, this would represent 47% of the issued and outstanding common stock of the Company.

 

Notes payable and Convertible Preferred Stock

 

During 2016, Windy River Group, LLC, provided funding to the Company in the form of notes payable totaling $98,768 (see Note 5) and Peter Grieve purchased 50 shares of Convertible Preferred Stock for $25,000. Peter Grieve is the owner/manager of Windy River Group, LLC. Mr. Grieve holds voting and investment power over any pecuniary interests in shares of the Company held by Windy River Group, LLC. At December 31, 2016 Windy River Group, LLC and Peter Grieve own 2,550 shares of Convertible Preferred Stock of the Company. If converted, this would represent 48% of the issued and outstanding common stock of the Company.

 

On September 30, 2015, effective with a change in control of the Company on the same date, the Company issued 720,000 shares of common stock, valued at $1,440,000, in exchange for the extinguishment of $525,000 in notes payable, $34,889 in related interest, and $26,474 owed to Mr. Kidd, payable on demand (see Note 5). Prior to January 20, 2014, Mr. Kidd was CEO and a Director of the Company and controlling shareholder. The Company has relied upon guidance provided in ASC 470-50-40, which states that entities must determine whether the difference between the fair value of the equity issued and the carrying value of the debt extinguished should be recognized a gain or loss or characterized as a capital transaction when with a related party. The Company issued the shares to its prior CEO and controlling shareholder and therefore the Company has recognized a decrease of $852,137 to additional paid in capital for the difference.

 

Severance and Release Agreements

 

Pursuant to a Release Agreement made effective September 29, 2015, and in connection with a change in control of the Company, the Company was released and forever discharged from any and all manner of action or actions against the Company in connection with any and all agreements entered into by and between the Company and R. Thomas Kidd on January 20, 2014.

 

Effective January 20, 2014, Mr. Kidd retired from his position with the Company, thereby terminating his Employment Agreement. For and as consideration of Kidd's resignation as CEO and Director and retirement from services to the Company, the Company agreed to compensate Mr. Kidd in the form of a severance package.

 

Upon execution of the agreement, and receipt of all documentation, Kidd shall immediately do the following:

 

•       Agree to return 5,000 shares of Convertible preferred stock of the Company to Company for cancelation upon closing of merger transaction.

•       Resign all positions, as applicable, with the Company.

  

 

On January 20, 2014, the Company entered into a consulting agreement with their former executive, R. Thomas Kidd (“Consultant”), effective upon the completion of a merger or acquisition. Under the agreement, the Company shall compensate Consultant in the form of two million (2,000,000) shares of unrestricted common stock of the Company with issuance to occur in installments of 250,000 shares per month for a period of 8 months. The Consultant shall be entitled to receive the shares as earned and in the event of termination of the agreement, Company shall be obligated to continue the issuance of shares until the entire 2 million shares are issued to Consultant.

 

Pursuant to a Release Agreement made effective September 29, 2015, and in connection with a change in control of the Company, the Company was released and forever discharged from any and all manner of action or actions against the Company in connection with any and all agreements entered into by and between the Company and R. Thomas Kidd.

 

Item 14.  Principal Accounting Fees and Services.

 

The aggregate fees billed by our principal accounting firm, Anton& Chia, LLP and for fees billed for fiscal years ended December 31, 2016 and 2015 are as follows:

 

Name   Audit Fees(1)   Audit Related Fees   Tax Fees   All Other Fees

 

For fiscal year ended:

December 31, 2016

  $31,500   $           0   $              0    $              0 

For fiscal year ended:

December 31, 2015

     $28,685     $           0       

 

$               0 

       $              0 

________________________________________

 

(1) Includes audit fees for the annual financial statements of the Company, and review of financial statements included in the Company's Form 10-Q quarterly reports and Form 10-K annual reports, and fees normally provided in connection with statutory and regulatory filings for those fiscal years

 

The Company does not currently have an audit committee. As a result, our board of directors performs the duties and functions of an audit committee. The Company's Board of Directors will evaluate and approve in advance, the scope and cost of the engagement of an auditor before the auditor renders audit and non-audit services. The Company do not rely on pre-approval policies and procedures.

 

Part IV

 

Item 15. Exhibits, Financial Statement Schedules

 

Copies of the following documents are included as exhibits to this report pursuant to Item 601 of Regulation S-B.

 

Exhibit   Description
31   Certification of Principal Executive Officer and Principal Financial Officer pursuant to Section 302 of Sarbanes-Oxley Act of 2002
32  

Certification of Principal Executive Officer and Principal Financial Officer pursuant to Section 906 of Sarbanes-Oxley Act of 2002

 

SIGNATURES

 

In accordance with the requirements of the Exchange Act, the registrant caused this report to be signed on its behalf by the undersigned, hereunto duly authorized.

 

SPUTNIK ENTERPRISES INC.

 

Dated: June 20, 2017 By:   /s/Anthony Gebbia

Anthony Gebbia, Chief Executive Officer and President

 

 

Dated: June 20, 2017 By:   /s/ Anthony Gebbia

Anthony Gebbia, Director

EX-31 2 spni_ex31.htm CERTIFICATION spni_ex31.htm

Exhibit 31

CERTIFICATION

 

I, Anthony Gebbia, certify that:

 

1. I have reviewed this report on Form 10-K of Sputnik Enterprises Inc.

 

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this annual report;

 

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this annual report;

 

4. I am responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15(d)-15(f)) for the registrant and have:

 

a) designed such disclosure controls and procedures, or caused such internal control over financing reporting to be designed under my supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
   
 b) designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
   
c) evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation;
   
d) disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the small business issuer’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

 

5. I have disclosed, based on my most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

 

a) any deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and
   
b)   any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.

 

 

Dated: June 20, 2017 By:   /s/Anthony Gebbia
    Anthony Gebbia, Chief Executive Officer and Chief Financial Officer

 

 

EX-32 3 spni_ex32.htm CERTIFICATION spni_ex32.htm

Exhibit 32

 

CERTIFICATION PURSUANT TO 18 U.S.C., ss.1350 AS ADOPTED

PURSUANT TO SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

 

In connection with the annual report on Form 10-K of Sputnik Enterprises Inc. (the “Company”) for the year ended December 31, 2016, as filed with the Securities and Exchange Commission on the date hereof (the “Report”), the undersigned Chief Executive Officer and Chief Financial Officer of the Company, hereby certifies pursuant to 18 U.S.C. ss.1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that:

 

1. The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

 

2. The information contained in the Report fairly presents in all material respects the financial condition and results of operations of Sputnik Enterprises Inc.

 

Dated: June 20, 2017 By:   /s/Anthony Gebbia
    Anthony Gebbia, Chief Executive Officer and Chief Financial Officer

 

A signed original of this written statement required by Section 906 has been provided to Sputnik Enterprises Inc., and will be retained by Sputnik Enterprises Inc., and furnished to the Securities and Exchange Commission or its staff upon request.

 

 

 

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May 31, 2017
Jun. 30, 2016
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Entity Registrant Name Sputnik Enterprises, Inc    
Entity Central Index Key 0001326917    
Document Type 10-K    
Document Period End Date Dec. 31, 2016    
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Current Fiscal Year End Date --12-31    
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Entity a Voluntary Filer No    
Entity's Reporting Status Current No    
Entity Filer Category Smaller Reporting Company    
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Entity Public Float     $ 201,751
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Document Fiscal Year Focus 2016    
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Revenue
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Dec. 31, 2015
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Net cash flows used in operating activities (98,717) (15,169)
Cash flows from investing activities:    
Loans to shareholder and related party (24,684)
Net cash flows from investing activities (24,684)
Cash flows from financing activities:    
Loans from shareholder and related party 98,768 17,924
Loan repayments to shareholders and related parties (2,500)
Preferred stock issuance 25,000
Net cash flows from financing activities 123,768 15,424
Net increase in cash 367 255
Cash, beginning of year 309 54
Cash, end of year 676 309
 Non- Cash Activities    
Common stock issued for debt extinguishment 1,440,000
Extinguishment of debt, related party (852,137)
Supplemtal cash flow disclosure    
Cash paid for interest
Cash paid for income taxes
XML 16 R7.htm IDEA: XBRL DOCUMENT v3.7.0.1
ORGANIZATION
12 Months Ended
Dec. 31, 2016
Notes to Financial Statements  
NOTE 1 - ORGANIZATION

Sputnik Enterprises Inc. incorporated in the State of Delaware on September 27, 2001 under the name Sputnik, Inc. On February 10, 2005, we filed Articles of Conversion and new Articles of Incorporation in Nevada and became a Nevada corporation. From that time until February 29, 2008, the Company developed and marketed Wi-Fi software, services, and hardware for the public access wireless networking market.

 

On November 13, 2007 we formed a wholly owned subsidiary, Laika, Inc., and transferred all of our assets and liabilities to Laika.

 

On February 6, 2008, the Company amended its Articles of Incorporation to change the name of Sputnik, Inc. to Sputnik Enterprises, Inc. upon conclusion of the sale of the stock of Laika, Inc. to AstroChimp, Inc.

 

On February 29, 2008, we closed the sale of the stock of our wholly owned subsidiary, Laika, Inc. to AstroChimp, Inc. for cancellation of a loan of $65,000 from David LaDuke to us, leaving us as a shell company. AstroChimp is wholly owned by Mr. LaDuke. Subsequently AstroChimp, Inc. changed its name to Sputnik, Inc. and continues to own and operate its business as a private entity.

 

On September 30, 2015, Sport Venture Group, LLC and Windy River Group, LLC acquired 5,000 shares (2,500 shares each) of Convertible Preferred Stock of the Company from R. Thomas Kidd for $250,000. If converted, this would represent 94% of the issued and outstanding common stock of the Company, indicating a change in control of the Company. On June 15, 2016 Peter Grieve acquired 50 shares of Convertible Preferred Stock of the Company from the Company. Peter Grieve is the owner/manager of Windy River Group, LLC.

XML 17 R8.htm IDEA: XBRL DOCUMENT v3.7.0.1
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
12 Months Ended
Dec. 31, 2016
Notes to Financial Statements  
NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Basis of Presentation

 

The Financial Statements and related disclosures have been prepared pursuant to the rules and regulations of the SEC. The Financial Statements have been prepared using the accrual basis of accounting in accordance with Generally Accepted Accounting Principles (“GAAP”) of the United States (See Note 3 regarding the assumption that the Company is a “going concern”).

 

Use of Estimates

 

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, the disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting periods. Actual results could differ from those estimates and assumptions.

 

Fiscal Year End

 

The Company elected December 31 as its fiscal year.

 

Cash and Cash Equivalents

 

The Company considers all highly liquid investments purchased with an original maturity of three months or less to be cash equivalents. Cash was $676 and $309 at December 31, 2016 and 2015, respectively and the Company had no cash equivalents for either of the periods ending December 31, 2016 and 2015.

 

Fair Value of Financial Instruments

 

The Company’s balance sheet includes certain financial instruments. The carrying amounts of current assets and current liabilities approximate their fair value because of the relatively short period of time between the origination of these instruments and their expected realization.

 

ASC 820, Fair Value Measurements and Disclosures, defines fair value as the exchange price that would be received for an asset or paid to transfer a liability (an exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date. ASC 820 also establishes a fair value hierarchy that distinguishes between (1) market participant assumptions developed based on market data obtained from independent sources (observable inputs) and (2) an entity’s own assumptions about market participant assumptions developed based on the best information available in the circumstances (unobservable inputs). The fair value hierarchy consists of three broad levels, which gives the highest priority to unadjusted quoted prices in active markets for identical assets or liabilities (Level 1) and the lowest priority to unobservable inputs (Level 3). The three levels of the fair value hierarchy are described below:

 

  · Level 1 - Unadjusted quoted prices in active markets that are accessible at the measurement date for identical, unrestricted assets or liabilities

 

  · Level 2 - Inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly or indirectly, including quoted prices for similar assets or liabilities in active markets; quoted prices for identical or similar assets or liabilities in markets that are not active; inputs other than quoted prices that are observable for the asset or liability (e.g., interest rates); and inputs that are derived principally from or corroborated by observable market data by correlation or other means.

 

  · Level 3 - Inputs that are both significant to the fair value measurement and unobservable.

 

Fair value estimates discussed herein are based upon certain market assumptions and pertinent information available to management as of December 31, 2016. The respective carrying value of certain on-balance-sheet financial instruments approximated their fair values due to the short-term nature of these instruments.

 

Income Taxes

 

The Company accounts for income taxes under ASC 740 Income Taxes.  Under the asset and liability method of ASC 740, deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial statements carrying amounts of existing assets and liabilities and their respective tax bases.  Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled.  The effect on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period the enactment occurs.  A valuation allowance is provided for certain deferred tax assets if it is more likely than not that the Company will not realize tax assets through future operations.  No deferred tax assets or liabilities were recognized as of December 31, 2016 or 2015.

 

Basic and Diluted Net Loss per Share

 

The Company computes basic and diluted earnings per share amounts in accordance with ASC Topic 260, Earnings per Share. Basic earnings per share is computed by dividing net income (loss) available to common shareholders by the weighted average number of common shares outstanding during the reporting period. Diluted earnings per share reflects the potential dilution that could occur if stock options and other commitments to issue common stock were exercised or equity awards vest resulting in the issuance of common stock that could share in the earnings of the Company. 

 

The Company has incurred a net operating loss for December 31, 2016 and 2015, and dilutive earnings per share would be anti-dilutive, therefore, dilutive earnings per share have not been presented. There are no options or warrants outstanding. The Company has common stock equivalents, in the form or convertible preferred stock, series A. Common stock equivalents were 52,500,000 and 52,000,000 for the years ending December 31, 2016 and December 31, 2015, respectively. There are only 50,000,000 shares of common stock authorized. It is the current intention of the Company following the filing of this report on Form 10-K and thereafter when the Company becomes current in all SEC filings to file an Information Statement on Schedule 14C to, among other things, increase the number of authorized shares of Common Stock to one billion shares.

 

Commitments and Contingencies

 

The Company follows ASC 450, Loss Contingencies, to report accounting for contingencies. Liabilities for loss contingencies arising from claims, assessments, litigation, fines and penalties and other sources are recorded when it is probable that a liability has been incurred and the amount of the assessment can be reasonably estimated. There were no commitments or contingencies as of December 31, 2016 and 2015.

 

Related Parties

 

The Company follows subtopic ASC 850, Related Party Disclosure, for the identification of related parties and disclosure of related party transactions. See Note 5 for related party transactions.

 

Cash Flows Reporting

 

The Company follows ASC 230, Statement of Cash Flows, for cash flows reporting, classifies cash receipts and payments according to whether they stem from operating, investing, or financing activities and provides definitions of each category, and uses the indirect or reconciliation method (“Indirect method”) as defined by ASC 230, Statement of Cash Flows, to report net cash flow from operating activities by adjusting net income to reconcile it to net cash flow from operating activities by removing the effects of (a) all deferrals of past operating cash receipts and payments and all accruals of expected future operating cash receipts and payments and (b) all items that are included in net income that do not affect operating cash receipts and payments. The Company reports the reporting currency equivalent of foreign currency cash flows, using the current exchange rate at the time of the cash flows and the effect of exchange rate changes on cash held in foreign currencies is reported as a separate item in the reconciliation of beginning and ending balances of cash and cash equivalents and separately provides information about investing and financing activities not resulting in cash receipts or payments in the period.

 

Share-based Expense

 

ASC 718, Compensation – Stock Compensation, prescribes accounting and reporting standards for all share-based payment transactions in which employee services are acquired. Transactions include incurring liabilities, or issuing or offering to issue shares, options, and other equity instruments such as employee stock ownership plans and stock appreciation rights. Share-based payments to employees, including grants of employee stock options, are recognized as compensation expense in the financial statements based on their fair values. That expense is recognized over the period during which an employee is required to provide services in exchange for the award, known as the requisite service period (usually the vesting period).

 

The Company accounts for stock-based compensation issued to non-employees and consultants in accordance with the provisions of ASC 505-50, Equity – Based Payments to Non-Employees.  Measurement of share-based payment transactions with non-employees is based on the fair value of whichever is more reliably measurable:  (a) the goods or services received; or (b) the equity instruments issued.  The fair value of the share-based payment transaction is determined at the earlier of performance commitment date or performance completion date.  

 

There was no share-based expense for the years ending December 31, 2016 and 2015.

 

RECENT ACCOUNTING PRONOUNCEMENTS

 

From time to time, new accounting pronouncements issued by the FASB or other standard setting bodies are adopted by the Company as of the specified effective date. Unless otherwise discussed, we believe that the impact of recently issued standards that are not yet effective will not have a material impact on our financial position or results of operations upon adoption.

 

In May 2014, the Financial Accounting Standards Board, or FASB, issued Accounting Standards Update No. 2014-09, Revenue from Contracts with Customers (Topic 606) , or ASU 606. ASU 606 provides guidance outlining a single comprehensive model for entities to use in accounting for revenue arising from contracts with customers that supersedes most current revenue recognition guidance. This guidance requires us to recognize revenue when we transfer promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. The original effective date of the guidance would have required us to adopt at the beginning of our first quarter of fiscal 2017; however, the FASB approved an optional one-year deferral of the effective date. Additionally, the new guidance requires enhanced disclosures, including revenue recognition policies to identify performance obligations to customers and significant judgments in measurement and recognition. The new guidance may be applied retrospectively to each prior period presented or retrospectively with the cumulative effect recognized as of the date of adoption.

 

In June 2014, the Financial Accounting Standards Board issued Accounting Standards Update No. 2014-10, which eliminated certain financial reporting requirements of companies previously identified as "Development Stage Entities" (Topic 915). The amendments in this ASU simplify accounting guidance by removing all incremental financial reporting requirements for development stage entities. The amendments also reduce data maintenance and, for those entities subject to audit, audit costs by eliminating the requirement for development stage entities to present inception-to-date information in the statements of income, cash flows, and shareholder equity. Early application of each of the amendments is permitted for any annual reporting period or interim period for which the entity's financial statements have not yet been issued (public business entities) or made available for issuance (other entities). Upon adoption, entities will no longer present or disclose any information required by Topic 915. The Company has adopted this standard.

 

In June 2014, FASB issued Accounting Standards Update (ASU) No. 2014-12 Compensation — Stock Compensation (Topic 718), Accounting for Share-Based Payments When the Terms of an Award Provide That a Performance Target Could Be Achieved after the Requisite Service Period. A performance target in a share-based payment that affects vesting and that could be achieved after the requisite service period should be accounted for as a performance condition under Accounting Standards Codification (ASC) 718, Compensation — Stock Compensation. As a result, the target is not reflected in the estimation of the award's grant date fair value. Compensation cost would be recognized over the required service period, if it is probable that the performance condition will be achieved. The guidance is effective for annual periods beginning after 15 December 2015 and interim periods within those annual periods. Early adoption is permitted. Management has reviewed the ASU and believes that they currently account for these awards in a manner consistent with the new guidance, therefore there is no anticipation of any effect to the financial statements.

 

In August 2014, FASB issued Accounting Standards Update (ASU) No. 2014-15 Preparation of Financial Statements – Going Concern (Subtopic 205-40), Disclosure of Uncertainties about an Entity's Ability to Continue as a Going Concern. Under generally accepted accounting principles (GAAP), continuation of a reporting entity as a going concern is presumed as the basis for preparing financial statements unless and until the entity's liquidation becomes imminent. Preparation of financial statements under this presumption is commonly referred to as the going concern basis of accounting. If and when an entity's liquidation becomes imminent, financial statements should be prepared under the liquidation basis of accounting in accordance with Subtopic 205-30, Presentation of Financial Statements—Liquidation Basis of Accounting. Even when an entity's liquidation is not imminent, there may be conditions or events that raise substantial doubt about the entity's ability to continue as a going concern. In those situations, financial statements should continue to be prepared under the going concern basis of accounting, but the amendments in this Update should be followed to determine whether to disclose information about the relevant conditions and events. The amendments in this Update are effective for the annual period ending after December 15, 2016, and for annual periods and interim periods thereafter. Early application is permitted. The Company will evaluate the going concern considerations in this ASU however, at the current period, management does not believe that it has met conditions which would subject these financial statements for additional disclosure.

 

In August 2014, FASB issued ASU 2014-15, Disclosure of Uncertainties about an Entity’s Ability to Continue as a Going Concern, or ASU 2014-15. ASU 2014-15 explicitly requires a company’s management to assess an entity’s ability to continue as a going concern, and to provide related footnote disclosures in certain circumstances. The new standard will be effective in the first annual period ending after December 15, 2016, although early application is permitted. We do not expect the adoption of this standard to have a material impact on our statements of financial position, results of operations or cash flows.

 

In April 2015, FASB issued ASU No. 2015-03, Interest – Imputation of Interest (Subtopic 835-30): Simplifying the presentation of Debt Issuance Costs, to reduce the complexity of having different balance sheet presentation requirements for debt issuance costs and debt discounts and premiums. The guidance requires debt issuance costs related to a recognized debt liability be reported on the balance sheet as a direct deduction from the carrying amount of that debt liability. ASU 2015-03 is effective for public companies for annual reporting periods beginning after December 15, 2015, and interim periods within those fiscal years. The Company has adopted the amendments of ASU 2015-03 effective January 1, 2016.

 

In November 2015, FASB issued ASU No. 2015-17, Balance Sheet Classification of Deferred Taxes. ASU 2015-17 simplifies the presentation of deferred taxes by requiring deferred tax assets and liabilities be classified as noncurrent on the balance sheet. ASU 2015-17 is effective for public companies for annual reporting periods beginning after December 15, 2016, and interim periods within those fiscal years. The guidance may be adopted prospectively or retrospectively and early adoption is permitted. We believe the adoption of this standard will have no material impact on our statements of financial position, results of operations or cash flows.

 

In February 2016, FASB issued ASU No. 2016-02, Leases (Topic 842). The core principle of Topic 842 is that a lessee should recognize the assets and liabilities that arise from leases. ASU 2016-02 is effective for public companies for annual reporting periods beginning after December 15, 2018, and interim periods within those fiscal years. The guidance may be adopted prospectively or retrospectively and early adoption is permitted. The Company is currently assessing the impact the adoption of ASU 2016-02 will have on its financial statements.

XML 18 R9.htm IDEA: XBRL DOCUMENT v3.7.0.1
GOING CONCERN
12 Months Ended
Dec. 31, 2016
Notes to Financial Statements  
NOTE 3 - GOING CONCERN

The Company incurred a net loss of $139,402 during the year ended December 31, 2016 and had net cash used in operating activities of $98,717 for the same period. Additionally, the Company had an accumulated deficit of $2,773,818 at December 31, 2016. In view of these matters, the Company's ability to continue as a going concern is dependent upon the Company's ability to achieve a level of profitability or to obtain adequate financing through the issuance of debt or equity in order to finance its operations. Upon securing an operating entity, through merger, Management intends to raise additional funds by way of a public or private offering. Management believes that the actions presently being taken to further implement its business plan and generate revenues provide the opportunity for the Company to continue as a going concern. The financial statements of the Company do not include any adjustments relating to the recoverability and classification of recorded assets, or the amounts and classifications of liabilities that might be necessary should the Company be unable to continue as a going concern.

 

While the Company is attempting to commence operations and produce revenues, the Company’s cash position may not be significant enough to support the Company’s daily operations. While the Company believes in the viability of its strategy to increase revenues and in its ability to raise additional funds, there can be no assurances to that effect. The ability of the Company to continue as a going concern is dependent upon the Company’s ability to further implement its business plan and generate revenues.

XML 19 R10.htm IDEA: XBRL DOCUMENT v3.7.0.1
LOANS TO RELATED PARTY
12 Months Ended
Dec. 31, 2016
Notes to Financial Statements  
NOTE 4 - LOANS TO RELATED PARTY

Summary of loans to related party (Sport Venture Group, LLC) are:

 

    December 31,   December 31,
Date Issued   2016   2015
May 27, 2016   $ 6,500     $ —    
June 27, 2016     4,000       —    
July 8, 2016     2,000       —    
July 20, 2016     300       —    
December 9, 2016     11,884       —    
    $ 24,684     $ —    

 

These notes bear interest at 10% with maturity dates one year from issuance. If notes are paid before maturity, a minimum interest of 10% is due at that time. Interest of $406 was accrued in 2016. The assets of the business, secure these notes second to any credit facility entered into by Sport Venture Group, LLC.

XML 20 R11.htm IDEA: XBRL DOCUMENT v3.7.0.1
NOTES PAYABLE, RELATED PARTY
12 Months Ended
Dec. 31, 2016
Notes to Financial Statements  
NOTE 5 - NOTES PAYABLE, RELATED PARTY

Summary of notes payable, related party (Windy River Group, LLC) are:

 

    December 31,   December 31,
Date Issued   2016   2015
May 26, 2016   $ 25,000     $ —    
November 29, 2016     50,000       —    
December 9, 2016     23,768       —    
    $ 98,768     $ —    

 

These notes bear interest at 10% with maturity dates one year from issuance. If notes are paid before maturity, a minimum interest of 10% is due at that time. Interest of $2,116 was accrued in 2016. The assets of the business secure these notes, second to any credit facility entered into by the Company.

 

On September 30, 2015, effective with a change in control of the Company on the same date, the Company issued 720,000 shares of common stock, valued at $1,440,000, in exchange for the extinguishment of $525,000 in notes payable, $34,889 in related interest, and $27,974 owed to Mr. Kidd, payable on demand (see Note 6). The Company has relied upon guidance provided in ASC 470-50-40, which states that entities must determine whether the difference between the fair value of the equity issued and the carrying value of the debt extinguished should be recognized a gain or loss or characterized as a capital transaction when with a related party. The Company issued the shares to its prior CEO and controlling shareholder and therefore the Company has recognized a decrease of $852,137 to additional paid in capital for the difference.

XML 21 R12.htm IDEA: XBRL DOCUMENT v3.7.0.1
RELATED PARTY TRANSACTIONS
12 Months Ended
Dec. 31, 2016
Notes to Financial Statements  
NOTE 6 - RELATED PARTY TRANSACTIONS

Loans to related party

 

During 2016, Sport Venture Group, LLC, was provided funding by the Company in the form of loans totaling $24,684 (see Note 4). At December 31, 2016 Sport Venture Group, LLC owns 2,500 shares of Convertible Preferred Stock of the Company. If converted, this would represent 47% of the issued and outstanding common stock of the Company.

 

Notes payable and Convertible Preferred Stock

 

During 2016, Windy River Group, LLC, provided funding to the Company in the form of notes payable totaling $98,768 (see Note 5) and Peter Grieve purchased 50 shares of Convertible Preferred Stock for $25,000. Peter Grieve is the owner/manager of Windy River Group, LLC. Mr. Grieve holds voting and investment power over any pecuniary interests in shares of the Company held by Windy River Group, LLC. At December 31, 2016 Windy River Group, LLC and Peter Grieve own 2,550 shares of Convertible Preferred Stock of the Company. If converted, this would represent 48% of the issued and outstanding common stock of the Company.

 

On September 30, 2015, effective with a change in control of the Company on the same date, the Company issued 720,000 shares of common stock, valued at $1,440,000, in exchange for the extinguishment of $525,000 in notes payable, $34,889 in related interest, and $26,474 owed to Mr. Kidd, payable on demand (see Note 5). Prior to January 20, 2014, Mr. Kidd was CEO and a Director of the Company and controlling shareholder. The Company has relied upon guidance provided in ASC 470-50-40, which states that entities must determine whether the difference between the fair value of the equity issued and the carrying value of the debt extinguished should be recognized a gain or loss or characterized as a capital transaction when with a related party. The Company issued the shares to its prior CEO and controlling shareholder and therefore the Company has recognized a decrease of $852,137 to additional paid in capital for the difference.

 

Severance and Release Agreements

 

Pursuant to a Release Agreement made effective September 29, 2015, and in connection with a change in control of the Company, the Company was released and forever discharged from any and all manner of action or actions against the Company in connection with any and all agreements entered into by and between the Company and R. Thomas Kidd on January 20, 2014.

 

Effective January 20, 2014, Mr. Kidd retired from his position with the Company, thereby terminating his Employment Agreement. For and as consideration of Kidd's resignation as CEO and Director and retirement from services to the Company, the Company agreed to compensate Mr. Kidd in the form of a severance package.

 

Upon execution of the agreement, and receipt of all documentation, Kidd shall immediately do the following:

 

  · Agree to return 5,000 shares of Convertible preferred stock of the Company to Company for cancelation upon closing of merger transaction.
  · Resign all positions, as applicable, with the Company.

 

On January 20, 2014, the Company entered into a consulting agreement with their former executive, R. Thomas Kidd (“Consultant”), effective upon the completion of a merger or acquisition. Under the agreement, the Company shall compensate Consultant in the form of two million (2,000,000) shares of unrestricted common stock of the Company with issuance to occur in installments of 250,000 shares per month for a period of 8 months. The Consultant shall be entitled to receive the shares as earned and in the event of termination of the agreement, Company shall be obligated to continue the issuance of shares until the entire 2 million shares are issued to Consultant.

 

Pursuant to a Release Agreement made effective September 29, 2015, and in connection with a change in control of the Company, the Company was released and forever discharged from any and all manner of action or actions against the Company in connection with any and all agreements entered into by and between the Company and R. Thomas Kidd.

 

Other

 

The Company does not own or lease property or lease office space. The office space used by the Company was arranged by the Officers of the Company to use at no charge.

 

The amounts and terms of the above transactions may not necessarily be indicative of the amounts and terms that would have been incurred had comparable transactions been entered into with independent third parties.

XML 22 R13.htm IDEA: XBRL DOCUMENT v3.7.0.1
EQUITY
12 Months Ended
Dec. 31, 2016
Notes to Financial Statements  
NOTE 7 - EQUITY

On February 14, 2013, the Company and Dutchess Opportunity Fund, II, LP (“Duchess”) entered into an Investment Agreement and a Registration Rights Agreement, which provides for the investment by Dutchess of up to $25 million over a period of 36 months. Under the terms of the Investment Agreement and Registration Rights Agreement, Dutchess will purchase common stock of the Company, subject to and wholly conditioned upon the Company filing an S-1 registration statement to register the shares acquired by Dutchess and the registration statement of the shares declared effective by the Securities and Exchange Commission. The Investment Agreement sets forth the terms and conditions under which Dutchess will purchase the common stock of the Issuer and other material conditions to the agreement between the parties. As of December 31, 2016, there has been no funding under the agreement.

 

Common Stock

 

The Company has authority to issue fifty million (50,000,000) common with a par value of $.001. The Company intends to issue additional shares in an effort to fund its operations.

 

No holder of shares of stock of any class is entitled, as a matter of right, to subscribe for or purchase or receive any part of any new or additional issue of shares of stock of any class, or of securities convertible into shares of stock of any class, whether now hereafter authorized or whether issued for money, for consideration other than money, or by way of dividend.

 

On January 20, 2014, the Company entered into a consulting agreement, effective upon completion of a merger or acquisition, with their former executive, R. Thomas Kidd. Under the agreement, the Company shall compensate Consultant in the form of two million (2,000,000) shares of unrestricted common stock of the Company with issuance to occur in installments of 250,000 shares per month for a period of 8 months. Under contractual agreement, the shares are to be issued as unrestricted shares. Pursuant to a Release Agreement made effective September 29, 2015, and in connection with a change in control of the Company, the Company was released and forever discharged from all agreements entered into by and between the Company and R. Thomas Kidd, thereby nullifying this agreement.

 

On September 29, 2015, the Company issued 720,000 shares of common stock in exchange for the release of debt and other agreements entered into with R. Thomas Kidd, the Company's former Chief Executive Officer and Director. The excess of the fair value of consideration paid ($1,440,000) over the debt and accrued interest extinguished ($552,974) was $852,137 and was recorded as a decrease to additional paid in capital on the extinguishment of debt to a related party pursuant to ASC 470-50-40. (see Note 6.)

 

Total common shares issued and outstanding at both December 31, 2016 and 2015 were 1,015,286.

 

If the Series A Convertible Preferred Stock was converted into common shares that would add additional shares of common stock of 52,500,000 as of December 31, 2016, more than the 50,000,000 shares of common stock currently authorized. It is the current intention of the Company following the filing of this report on Form 10-K and thereafter when the Company becomes current in all SEC filings to file an Information Statement on Schedule 14C to, among other things, increase the number of authorized shares of Common Stock to one billion shares.

 

Preferred stock

 

The Company amended its Articles of Incorporation in May 2013 and subsequently has authority to issue ten million (10,000,000) Series A Convertible Preferred with a par value of $10.00, of which 5,250 shares have been issued as of December 31, 2016. This class of stock may be convertible into common shares at the rate of one share of Series A Convertible Preferred for 1,000 shares of common. There are no liquidation preferences over common shares, but the Series A Convertible Preferred may be voted as if converted and are entitled to dividend treatment as if converted to common. Series A Convertible Preferred may be converted to common shares at any time after one year from the date of issuance at the option of the holder.

 

On September 30, 2015, Sport Venture Group, LLC and Windy River Group, LLC acquired 5,000 shares (2,500 shares each) of Convertible Preferred Stock of the Company from R. Thomas Kidd for $250,000. If converted, this would represent 94.26% of the issued and outstanding common stock of the Company, indicating a change in control of the Company.

 

On December 22, 2015, the Company filed an Amendment to the Certificate of Designation that modified the rights of the holders of Series A Convertible Preferred Stock by changing the conversion ratio to 10,000 shares of common stock for one share of Series A Convertible Preferred Stock and eliminating any holding requirement before conversion.

 

On June 15, 2016, Peter Grieve purchased 50 shares of Convertible Preferred Stock for $25,000. Peter Grieve is the owner/manager of Windy River Group, LLC. Mr. Grieve holds voting and investment power over any pecuniary interests in shares of the Company held by Windy River Group, LLC.

 

Sport Venture Group, LLC

 

Sport Venture Group, LLC was incorporated in the State of South Carolina. The principal business of SVG is that of a sport investment and holding company that seeks to invest, hold and manage its various multisport interests. Ron Konersmann is the Owner/Manager of Sport Venture Group, LLC. Mr. Konersmann holds voting and investment power over any pecuniary interests in shares of the Company held by Sport Venture Group, LLC.

 

Windy River Group, LLC

 

Windy River Group, LLC was incorporated in the State of Massachusetts. The principal business of WRG is that of a private investment firm with interests in international football, banking, wealth management, and technology. Peter Grieve is the owner/manager of Windy River Group, LLC. Mr. Grieve holds voting and investment power over any pecuniary interests in shares of the Company held by WRG.

 

Total preferred shares, series A, issued and outstanding as of December 31, 2016 and December 31, 2015 were 5,250 and 5,200, respectively.

XML 23 R14.htm IDEA: XBRL DOCUMENT v3.7.0.1
INCOME TAXES
12 Months Ended
Dec. 31, 2016
Notes to Financial Statements  
NOTE 8 - INCOME TAXES

The Company uses the liability method, where deferred tax assets and liabilities are determined based on the expected future tax consequences of temporary differences between the carrying amounts of assets and liabilities for financial and income tax reporting purposes. During fiscal 2016 and 2015, the Company incurred a net loss and therefore has no tax liability. The net deferred tax asset generated by the loss carry-forward has been fully reserved. The cumulative net operating loss carry-forward was approximately $2,774,000 and $2,634,000 at December 31, 2016 and 2015, respectively, and will begin to expire in the year 2025.

 

At December 31, 2016 and 2015, deferred tax assets at the statutory rate consisted of the following:

 

Deferred tax assets   2016   2015
Tax benefit   $ 943,098     $ 895,701  
Less: valuation allowance     (943,098 )     (895,701 )
Net deferred tax asset   $ —       $ —    
XML 24 R15.htm IDEA: XBRL DOCUMENT v3.7.0.1
COMMITMENTS AND CONTINGENCIES
12 Months Ended
Dec. 31, 2016
Notes to Financial Statements  
NOTE 9 - COMMITMENTS AND CONTINGENCIES

Some of the officers and directors of the Company are involved in other business activities and may in the future, become involved in other business opportunities that become available. They may face a conflict in selecting between the Company and other business interests. The Company has not formulated a policy for the resolution of such conflicts.

 

In the normal course of business, the Company may become a party to litigation matters involving claims against the Company.   The Company's management is unaware of any pending or threatened assertions and there are no current matters that would have a material effect on the Company’s financial position or results of operations.

 

The Company’s operations are subject to significant risks and uncertainties including financial, operational and regulatory risks, including the potential risk of business failure.

XML 25 R16.htm IDEA: XBRL DOCUMENT v3.7.0.1
DEFINITIVE AGREEMENT FOR REVERSE MERGER TRANSACTION
12 Months Ended
Dec. 31, 2016
Notes to Financial Statements  
NOTE 10 - DEFINITIVE AGREEMENT FOR REVERSE MERGER TRANSACTION

An Agreement was made on February 5, 2016 between FV Corporation ("FV" or "Seller") and Sputnik Enterprises, Inc. ("SPNI" or "Buyer"). The Agreement provides that, subject to all the terms and conditions of this Agreement, at the Closing, FV agrees to receive from SPNI, and SPNI agrees to issue to the shareholders of the Seller (each, a "Shareholder") an aggregate of 45,170,085 shares of Common Stock ("SPNI Common Stock") and such number of shares of Series A Convertible Preferred Stock that convert into an additional 45,170,085 shares of Common Stock of SPNI ("SPNI Preferred Stock") (the SPNI Common Stock and the SPNI Preferred Stock collectively, the "Share Consideration") in exchange for the transfer of all of the issued and outstanding shares of the Common Stock of FV ("FV Shareholder's Shares") to SPNI. Each FV Shareholder's Share that is issued and outstanding immediately before the Closing shall entitle the holder thereof to receive one share of SPNI Common Stock and 0.0001 shares of SPNI Preferred Stock which equates to one share of common stock (together, the "Exchange Ratio"), such that when all shares of Common Stock and SPNI Preferred Stock have been issued under this Agreement and all shares Preferred Stock issued under this Agreement have been converted to common stock, an aggregate of 90,340,170 shares of SPNI Common Stock shall have been issued to FV's Shareholders under this Agreement. Notwithstanding the foregoing, prior to Closing, the parties shall adjust the number of FV Shareholder's Shares to be transferred to SPNI to such number of shares of FV Common Stock as is actually issued and outstanding as of the Closing Date and the aggregate number shares of SPNI Common Stock and SPNI Preferred Stock to be issued to the FV Shareholders shall be adjusted accordingly pursuant to the Exchange Ratio.

 

Sport Venture Group, LLC and Windy River Group, LLC own 62% and 3%, respectively of FV as of December 31, 2016.

 

Closing of the Agreement is contingent upon a number of terms and conditions described in the Agreement, including FV securing shareholder approval as required under the laws of South Carolina and completion of an audit of FV Corporation. As of the filing of this report, shareholder approval has been acquired by FV and the Company anticipates the conclusion of FV’s audit on or before June 30, 2017.

XML 26 R17.htm IDEA: XBRL DOCUMENT v3.7.0.1
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Policies)
12 Months Ended
Dec. 31, 2016
Summary Of Significant Accounting Policies Policies  
Basis of Presentation

The Financial Statements and related disclosures have been prepared pursuant to the rules and regulations of the SEC. The Financial Statements have been prepared using the accrual basis of accounting in accordance with Generally Accepted Accounting Principles (“GAAP”) of the United States (See Note 3 regarding the assumption that the Company is a “going concern”).

Use of Estimates

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, the disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting periods. Actual results could differ from those estimates and assumptions.

Fiscal Year End

The Company elected December 31 as its fiscal year.

Cash and Cash Equivalents

The Company considers all highly liquid investments purchased with an original maturity of three months or less to be cash equivalents. Cash was $676 and $309 at December 31, 2016 and 2015, respectively and the Company had no cash equivalents for either of the periods ending December 31, 2016 and 2015.

Fair Value of Financial Instruments

The Company’s balance sheet includes certain financial instruments. The carrying amounts of current assets and current liabilities approximate their fair value because of the relatively short period of time between the origination of these instruments and their expected realization.

 

ASC 820, Fair Value Measurements and Disclosures, defines fair value as the exchange price that would be received for an asset or paid to transfer a liability (an exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date. ASC 820 also establishes a fair value hierarchy that distinguishes between (1) market participant assumptions developed based on market data obtained from independent sources (observable inputs) and (2) an entity’s own assumptions about market participant assumptions developed based on the best information available in the circumstances (unobservable inputs). The fair value hierarchy consists of three broad levels, which gives the highest priority to unadjusted quoted prices in active markets for identical assets or liabilities (Level 1) and the lowest priority to unobservable inputs (Level 3). The three levels of the fair value hierarchy are described below:

 

  · Level 1 - Unadjusted quoted prices in active markets that are accessible at the measurement date for identical, unrestricted assets or liabilities

 

  · Level 2 - Inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly or indirectly, including quoted prices for similar assets or liabilities in active markets; quoted prices for identical or similar assets or liabilities in markets that are not active; inputs other than quoted prices that are observable for the asset or liability (e.g., interest rates); and inputs that are derived principally from or corroborated by observable market data by correlation or other means.

 

  · Level 3 - Inputs that are both significant to the fair value measurement and unobservable.

 

Fair value estimates discussed herein are based upon certain market assumptions and pertinent information available to management as of December 31, 2016. The respective carrying value of certain on-balance-sheet financial instruments approximated their fair values due to the short-term nature of these instruments.

Income taxes

The Company accounts for income taxes under ASC 740 Income Taxes.  Under the asset and liability method of ASC 740, deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial statements carrying amounts of existing assets and liabilities and their respective tax bases.  Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled.  The effect on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period the enactment occurs.  A valuation allowance is provided for certain deferred tax assets if it is more likely than not that the Company will not realize tax assets through future operations.  No deferred tax assets or liabilities were recognized as of December 31, 2016 or 2015.

Basic and Diluted Net Loss per Share

The Company computes basic and diluted earnings per share amounts in accordance with ASC Topic 260, Earnings per Share. Basic earnings per share is computed by dividing net income (loss) available to common shareholders by the weighted average number of common shares outstanding during the reporting period. Diluted earnings per share reflects the potential dilution that could occur if stock options and other commitments to issue common stock were exercised or equity awards vest resulting in the issuance of common stock that could share in the earnings of the Company. 

 

The Company has incurred a net operating loss for December 31, 2016 and 2015, and dilutive earnings per share would be anti-dilutive, therefore, dilutive earnings per share have not been presented. There are no options or warrants outstanding. The Company has common stock equivalents, in the form or convertible preferred stock, series A. Common stock equivalents were 52,500,000 and 52,000,000 for the years ending December 31, 2016 and December 31, 2015, respectively. There are only 50,000,000 shares of common stock authorized. It is the current intention of the Company following the filing of this report on Form 10-K and thereafter when the Company becomes current in all SEC filings to file an Information Statement on Schedule 14C to, among other things, increase the number of authorized shares of Common Stock to one billion shares.

Commitments and contingencies

The Company follows ASC 450, Loss Contingencies, to report accounting for contingencies. Liabilities for loss contingencies arising from claims, assessments, litigation, fines and penalties and other sources are recorded when it is probable that a liability has been incurred and the amount of the assessment can be reasonably estimated. There were no commitments or contingencies as of December 31, 2016 and 2015.

Related parties

The Company follows subtopic ASC 850, Related Party Disclosure, for the identification of related parties and disclosure of related party transactions. See Note 5 for related party transactions.

Cash Flows Reporting

The Company follows ASC 230, Statement of Cash Flows, for cash flows reporting, classifies cash receipts and payments according to whether they stem from operating, investing, or financing activities and provides definitions of each category, and uses the indirect or reconciliation method (“Indirect method”) as defined by ASC 230, Statement of Cash Flows, to report net cash flow from operating activities by adjusting net income to reconcile it to net cash flow from operating activities by removing the effects of (a) all deferrals of past operating cash receipts and payments and all accruals of expected future operating cash receipts and payments and (b) all items that are included in net income that do not affect operating cash receipts and payments. The Company reports the reporting currency equivalent of foreign currency cash flows, using the current exchange rate at the time of the cash flows and the effect of exchange rate changes on cash held in foreign currencies is reported as a separate item in the reconciliation of beginning and ending balances of cash and cash equivalents and separately provides information about investing and financing activities not resulting in cash receipts or payments in the period.

Share-based Expense

ASC 718, Compensation – Stock Compensation, prescribes accounting and reporting standards for all share-based payment transactions in which employee services are acquired. Transactions include incurring liabilities, or issuing or offering to issue shares, options, and other equity instruments such as employee stock ownership plans and stock appreciation rights. Share-based payments to employees, including grants of employee stock options, are recognized as compensation expense in the financial statements based on their fair values. That expense is recognized over the period during which an employee is required to provide services in exchange for the award, known as the requisite service period (usually the vesting period).

 

The Company accounts for stock-based compensation issued to non-employees and consultants in accordance with the provisions of ASC 505-50, Equity – Based Payments to Non-Employees.  Measurement of share-based payment transactions with non-employees is based on the fair value of whichever is more reliably measurable:  (a) the goods or services received; or (b) the equity instruments issued.  The fair value of the share-based payment transaction is determined at the earlier of performance commitment date or performance completion date.

Recent Accounting Pronouncements

From time to time, new accounting pronouncements issued by the FASB or other standard setting bodies are adopted by the Company as of the specified effective date. Unless otherwise discussed, we believe that the impact of recently issued standards that are not yet effective will not have a material impact on our financial position or results of operations upon adoption.

 

In May 2014, the Financial Accounting Standards Board, or FASB, issued Accounting Standards Update No. 2014-09, Revenue from Contracts with Customers (Topic 606) , or ASU 606. ASU 606 provides guidance outlining a single comprehensive model for entities to use in accounting for revenue arising from contracts with customers that supersedes most current revenue recognition guidance. This guidance requires us to recognize revenue when we transfer promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. The original effective date of the guidance would have required us to adopt at the beginning of our first quarter of fiscal 2017; however, the FASB approved an optional one-year deferral of the effective date. Additionally, the new guidance requires enhanced disclosures, including revenue recognition policies to identify performance obligations to customers and significant judgments in measurement and recognition. The new guidance may be applied retrospectively to each prior period presented or retrospectively with the cumulative effect recognized as of the date of adoption.

 

In June 2014, the Financial Accounting Standards Board issued Accounting Standards Update No. 2014-10, which eliminated certain financial reporting requirements of companies previously identified as "Development Stage Entities" (Topic 915). The amendments in this ASU simplify accounting guidance by removing all incremental financial reporting requirements for development stage entities. The amendments also reduce data maintenance and, for those entities subject to audit, audit costs by eliminating the requirement for development stage entities to present inception-to-date information in the statements of income, cash flows, and shareholder equity. Early application of each of the amendments is permitted for any annual reporting period or interim period for which the entity's financial statements have not yet been issued (public business entities) or made available for issuance (other entities). Upon adoption, entities will no longer present or disclose any information required by Topic 915. The Company has adopted this standard.

 

In June 2014, FASB issued Accounting Standards Update (ASU) No. 2014-12 Compensation — Stock Compensation (Topic 718), Accounting for Share-Based Payments When the Terms of an Award Provide That a Performance Target Could Be Achieved after the Requisite Service Period. A performance target in a share-based payment that affects vesting and that could be achieved after the requisite service period should be accounted for as a performance condition under Accounting Standards Codification (ASC) 718, Compensation — Stock Compensation. As a result, the target is not reflected in the estimation of the award's grant date fair value. Compensation cost would be recognized over the required service period, if it is probable that the performance condition will be achieved. The guidance is effective for annual periods beginning after 15 December 2015 and interim periods within those annual periods. Early adoption is permitted. Management has reviewed the ASU and believes that they currently account for these awards in a manner consistent with the new guidance, therefore there is no anticipation of any effect to the financial statements.

 

In August 2014, FASB issued Accounting Standards Update (ASU) No. 2014-15 Preparation of Financial Statements – Going Concern (Subtopic 205-40), Disclosure of Uncertainties about an Entity's Ability to Continue as a Going Concern. Under generally accepted accounting principles (GAAP), continuation of a reporting entity as a going concern is presumed as the basis for preparing financial statements unless and until the entity's liquidation becomes imminent. Preparation of financial statements under this presumption is commonly referred to as the going concern basis of accounting. If and when an entity's liquidation becomes imminent, financial statements should be prepared under the liquidation basis of accounting in accordance with Subtopic 205-30, Presentation of Financial Statements—Liquidation Basis of Accounting. Even when an entity's liquidation is not imminent, there may be conditions or events that raise substantial doubt about the entity's ability to continue as a going concern. In those situations, financial statements should continue to be prepared under the going concern basis of accounting, but the amendments in this Update should be followed to determine whether to disclose information about the relevant conditions and events. The amendments in this Update are effective for the annual period ending after December 15, 2016, and for annual periods and interim periods thereafter. Early application is permitted. The Company will evaluate the going concern considerations in this ASU however, at the current period, management does not believe that it has met conditions which would subject these financial statements for additional disclosure.

 

In August 2014, FASB issued ASU 2014-15, Disclosure of Uncertainties about an Entity’s Ability to Continue as a Going Concern, or ASU 2014-15. ASU 2014-15 explicitly requires a company’s management to assess an entity’s ability to continue as a going concern, and to provide related footnote disclosures in certain circumstances. The new standard will be effective in the first annual period ending after December 15, 2016, although early application is permitted. We do not expect the adoption of this standard to have a material impact on our statements of financial position, results of operations or cash flows.

 

In April 2015, FASB issued ASU No. 2015-03, Interest – Imputation of Interest (Subtopic 835-30): Simplifying the presentation of Debt Issuance Costs, to reduce the complexity of having different balance sheet presentation requirements for debt issuance costs and debt discounts and premiums. The guidance requires debt issuance costs related to a recognized debt liability be reported on the balance sheet as a direct deduction from the carrying amount of that debt liability. ASU 2015-03 is effective for public companies for annual reporting periods beginning after December 15, 2015, and interim periods within those fiscal years. The Company has adopted the amendments of ASU 2015-03 effective January 1, 2016.

 

In November 2015, FASB issued ASU No. 2015-17, Balance Sheet Classification of Deferred Taxes. ASU 2015-17 simplifies the presentation of deferred taxes by requiring deferred tax assets and liabilities be classified as noncurrent on the balance sheet. ASU 2015-17 is effective for public companies for annual reporting periods beginning after December 15, 2016, and interim periods within those fiscal years. The guidance may be adopted prospectively or retrospectively and early adoption is permitted. We believe the adoption of this standard will have no material impact on our statements of financial position, results of operations or cash flows.

 

In February 2016, FASB issued ASU No. 2016-02, Leases (Topic 842). The core principle of Topic 842 is that a lessee should recognize the assets and liabilities that arise from leases. ASU 2016-02 is effective for public companies for annual reporting periods beginning after December 15, 2018, and interim periods within those fiscal years. The guidance may be adopted prospectively or retrospectively and early adoption is permitted. The Company is currently assessing the impact the adoption of ASU 2016-02 will have on its financial statements.

XML 27 R18.htm IDEA: XBRL DOCUMENT v3.7.0.1
LOANS TO RELATED PARTY (Table)
12 Months Ended
Dec. 31, 2016
Loans To Related Party Table  
LOANS TO RELATED PARTY
    December 31,   December 31,
Date Issued   2016   2015
May 27, 2016   $ 6,500     $ —    
June 27, 2016     4,000       —    
July 8, 2016     2,000       —    
July 20, 2016     300       —    
December 9, 2016     11,884       —    
    $ 24,684     $ —    
XML 28 R19.htm IDEA: XBRL DOCUMENT v3.7.0.1
NOTES PAYABLE, RELATED PARTY (Tables)
12 Months Ended
Dec. 31, 2016
Notes Payable Related Party Tables  
Summary of notes payable

Summary of notes payable, related party (Windy River Group, LLC) are:

 

    December 31,   December 31,
Date Issued   2016   2015
May 26, 2016   $ 25,000     $ —    
November 29, 2016     50,000       —    
December 9, 2016     23,768       —    
    $ 98,768     $ —    

XML 29 R20.htm IDEA: XBRL DOCUMENT v3.7.0.1
INCOME TAXES (Tables)
12 Months Ended
Dec. 31, 2016
Income Taxes Tables  
Deferred tax assets

Deferred tax assets   2016   2015
Tax benefit   $ 943,098     $ 895,701  
Less: valuation allowance     (943,098 )     (895,701 )
Net deferred tax asset   $ —       $ —    

XML 30 R21.htm IDEA: XBRL DOCUMENT v3.7.0.1
ORGANIZATION (Details Narrative) - USD ($)
12 Months Ended
Dec. 31, 2016
Sep. 30, 2015
Jun. 15, 2015
Feb. 29, 2008
Entity Incorporation, State Country Name State of Delaware      
Entity Incorporation, Date of Incorporation Sep. 27, 2001      
Cancellation of loan       $ 65,000
Convertible Preferred Stock [Member]        
Acquired shares   5,000    
Acquired shares value   $ 250,000    
Convertible Preferred Stock [Member] | Windy River Group, LLC [Member]        
Acquired shares   2,500    
Convertible Preferred Stock [Member] | Sport Venture Group, LLC [Member]        
Acquired shares   2,500    
Convertible Preferred Stock [Member] | Peter Grieve [Member]        
Acquired shares     50  
XML 31 R22.htm IDEA: XBRL DOCUMENT v3.7.0.1
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Details Narrative) - USD ($)
12 Months Ended
Dec. 31, 2016
Dec. 31, 2015
Dec. 31, 2014
Summary Of Significant Accounting Policies Details Narrative      
Cash and cash equivalents $ 676 $ 309 $ 54
Common stock equivalents 52,500,000 5,200,000  
Common stock, authorized shares 50,000,000 50,000,000  
Share-based expense $ 0 $ 0  
XML 32 R23.htm IDEA: XBRL DOCUMENT v3.7.0.1
GOING CONCERN (Details Narrative) - USD ($)
12 Months Ended
Dec. 31, 2016
Dec. 31, 2015
Going Concern Details Narrative    
Net loss $ (139,402) $ (32,884)
Net cash flows used in operating activities (98,717) (15,169)
Accumulated deficit $ (2,773,818) $ (2,634,416)
XML 33 R24.htm IDEA: XBRL DOCUMENT v3.7.0.1
LOANS TO RELATED PARTY (Details) - USD ($)
Dec. 31, 2016
Dec. 31, 2015
Loans to related party $ 24,684
May 27, 2016 [Member]    
Loans to related party 6,500
June 27, 2016 [Member]    
Loans to related party 4,000
July 8, 2016 [Member]    
Loans to related party 2,000
July 20, 2016 [Member]    
Loans to related party 300
December 9, 2016 [Member]    
Loans to related party $ 11,884
XML 34 R25.htm IDEA: XBRL DOCUMENT v3.7.0.1
LOANS TO RELATED PARTY (Details Narrative) - Sport Venture Group, LLC [Member]
12 Months Ended
Dec. 31, 2016
USD ($)
Interest rate 10.00%
Accrued interest $ 406
XML 35 R26.htm IDEA: XBRL DOCUMENT v3.7.0.1
NOTES PAYABLE, RELATED PARTY (Details) - USD ($)
Dec. 31, 2016
Dec. 31, 2015
Notes Payable $ 98,768
November 29, 2016 [Member]    
Notes Payable 50,000  
May 26, 2016 [Member]    
Notes Payable 25,000
December 9, 2016 [Member]    
Notes Payable $ 23,768
XML 36 R27.htm IDEA: XBRL DOCUMENT v3.7.0.1
NOTES PAYABLE, RELATED PARTY (Details Narrative) - USD ($)
1 Months Ended 12 Months Ended
Sep. 30, 2015
Sep. 29, 2015
Dec. 31, 2016
Dec. 31, 2015
Extinguishment of debt $ 525,000 $ 552,974 $ (852,137)
Extinguishment of interest 34,889      
Extinguishment of demand payable 27,974      
Decrease in additional paid in capital $ 852,137      
Common shares issued 720,000 720,000    
Common shares issued, value $ 1,440,000 $ 1,440,000 $ 1,015 $ 1,015
Windy River Group, LLC [Member]        
Interest rate     10.00%  
Accrued interest     $ 2,116  
XML 37 R28.htm IDEA: XBRL DOCUMENT v3.7.0.1
RELATED PARTY TRANSACTIONS (Details Narrative) - USD ($)
1 Months Ended 12 Months Ended
Sep. 30, 2015
Sep. 29, 2015
Jan. 20, 2014
Dec. 31, 2016
Dec. 31, 2015
Stock purchase, amount       $ 25,000  
Convertible Promissory Note       98,768
Extinguishment of debt $ 525,000 $ 552,974   (852,137)
Extinguishment of interest 34,889        
Extinguishment of demand payable 27,974        
Decrease in additional paid in capital $ 852,137        
Common shares issued 720,000 720,000      
Common shares issued, value $ 1,440,000 $ 1,440,000   1,015 1,015
Imputed interest       $ 0 $ 675
Peter Grieve [Member] | Convertible Preferred Stock [Member]          
Stock purchase, shares       50  
Stock purchase, amount       $ 25,000  
Windy River Group, LLC [Member]          
Total loans       $ 98,768  
Interest rate       10.00%  
Windy River Group, LLC [Member] | Peter Grieve [Member]          
Convertible preferred stock, shares       2,550  
Conversion description       If converted, this would represent 48% of the issued and outstanding common stock of the Company  
Sport Venture Group, LLC [Member]          
Total loans       $ 24,684  
Convertible preferred stock, shares       2,500  
Conversion description       If converted, this would represent 47% of the issued and outstanding common stock of the Company  
Interest rate       10.00%  
Consultant [Member]          
Compensation for services, shares     2,000,000    
Compensation for services per month, shares     250,000    
Mr. Kidd [Member]          
Convertible Promissory Note     $ 400,000    
Extinguishment of demand payable $ 26,474        
Life policy premium     $ 500,000    
Compensation for services, shares     2,000,000    
Cancellation of Convertible preferred stock     5,000    
XML 38 R29.htm IDEA: XBRL DOCUMENT v3.7.0.1
EQUITY (Details Narrative) - USD ($)
1 Months Ended 12 Months Ended
Dec. 22, 2015
Sep. 30, 2015
Sep. 29, 2015
Jan. 20, 2014
Feb. 14, 2013
Dec. 31, 2016
Dec. 31, 2015
Common stock, issued shares           50,000,000 50,000,000
Common stock, par value           $ 0.001 $ 0.001
Common stock, issued           1,015,286 1,015,286
Common stock, outstanding shares           1,015,286 1,015,286
Investment description        

The investment by Dutchess of up to $25 million over a period of 36 months

   
Reverse stock split          

The number of shares outstanding has been understated by eight (8) shares since the Company undertook a 1 for 50 reverse stock split

 
Decrease in additional paid in capital     $ 852,137        
Common shares issued   720,000 720,000        
Common shares issued, value   $ 1,440,000 $ 1,440,000     $ 1,015 $ 1,015
Extinguishment of debt, related party   $ 525,000 $ 552,974     $ (852,137)
Preferred Stock Series A, authorized shares           10,000,000 10,000,000
Preferred Stock Series A, par value           $ 10.00 $ 10.00
Preferred Stock Series A, issued shares           5,250 5,200
Preferred Stock Series A, outstanding shares           5,250 5,200
Consultant [Member]              
Compensation for services, shares       2,000,000      
Compensation for services per month, shares       250,000      
Sport Venture Group, LLC [Member]              
Conversion description           If converted, this would represent 47% of the issued and outstanding common stock of the Company  
Series A Preferred Stock [Member]              
Reverse stock split

10,000 shares of common stock for one share of Series A Convertible Preferred Stock

       

The rate of one share of Series A Convertible Preferred for 1,000 shares of common

 
Convertible Preferred Stock [Member]              
Acquired shares   5,000          
Acquired shares value   $ 250,000          
Convertible Preferred Stock [Member] | Windy River Group, LLC [Member]              
Acquired shares   2,500          
Convertible Preferred Stock [Member] | Sport Venture Group, LLC [Member]              
Acquired shares   2,500          
XML 39 R30.htm IDEA: XBRL DOCUMENT v3.7.0.1
INCOME TAXES (Details) - USD ($)
Dec. 31, 2016
Dec. 31, 2015
Deferred tax assets    
Tax benefit $ 943,098 $ 895,701
Less: valuation allowance (943,098) (895,701)
Net deferred tax asset
XML 40 R31.htm IDEA: XBRL DOCUMENT v3.7.0.1
INCOME TAXES (Details Narrative) - USD ($)
12 Months Ended
Dec. 31, 2016
Dec. 31, 2015
Income Taxes Details    
Operating loss carry-forward $ 2,774,000 $ 2,634,000
Operating loss carry-forward expiration year 2025  
XML 41 R32.htm IDEA: XBRL DOCUMENT v3.7.0.1
Definitive Agreement for Reverse Merger Transaction (Details Narrative) - shares
Feb. 05, 2016
Sep. 30, 2015
Sep. 29, 2015
Shares issued   720,000 720,000
Common Stock | SPNI [Member]      
Shares issued 45,170,085    
Exchange ratio description

One share of SPNI Common Stock and 0.0001 shares of SPNI Preferred Stock which equates to one share of common stock (together, the "Exchange Ratio")

   
Converted shares 90,340,170    
Preferred Stock | SPNI [Member]      
Preferred stock issued description

Such number of shares of Series A Convertible Preferred Stock that convert into an additional 45,170,085 shares of Common Stock of SPNI

   
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