10-Q

U.S. SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

[X] QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended September 30, 2016

[   ]TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

Commission file number:  000-55205

Alpine 4 Technologies Ltd.

(Exact name of registrant as specified in its charter)

Delaware	46-5482689
(State or Other Jurisdiction of Incorporation or Organization)	(I.R.S. Employer Identification No.)
4742 N. 24th Street Suite 300
Phoenix, AZ	85016
(Address of Principal Executive Offices)	(Zip Code)

Registrant's telephone number, including area code: 855-777-0077 ext 801

 (Former name, former address and former fiscal year, if changed since last report)

Indicate by check mark whether the registrant (1) filed all reports required to be filed by Section 13 or 15(d) of the Exchange Act during the past 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 ☐

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 ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company.

Large accelerated filer	☐	Accelerated filer	☐
Non-accelerated filer	☐	Smaller reporting company	☒

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).  Yes ☐       No ☒

State the number of shares outstanding of each of the issuer's classes of common equity, as of the latest practicable date:  As of November 14, 2016, the issuer had 21,281,117 shares of its Class A common stock issued and outstanding and 1,600,000 shares of its Class B common stock issued and outstanding.

TABLE OF CONTENTS

PART I		Page
Item 1.	Financial Statements	3
Item 2.	Management's Discussion and Analysis of Financial Condition and Results of Operations	20
Item 3.	Quantitative and Qualitative Disclosures About Market Risk	27
Item 4.	Controls and Procedures	27
PART II
Item 1.	Legal Proceedings	28
Item 1A.	Risk Factors	28
Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	28
Item 3.	Defaults Upon Senior Securities	29
Item 4.	Mine Safety Disclosures	29
Item 5.	Other Information	29
Item 6.	Exhibits	29
	Signatures	30

2

PART I - FINANCIAL INFORMATION

Item 1.  Financial Statements.

Alpine 4 Technologies Ltd.

Financial Statements

(Unaudited)

Contents

Financial Statements	PAGE
Consolidated Balance Sheets (Unaudited)	4
Consolidated Statements of Operations (Unaudited)	5
Consolidated Statements of Cash Flows (Unaudited)	6
Notes to Consolidated Financial Statements (Unaudited)	7

3

ALPINE 4 TECHNOLOGIES, LTD. and SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
(Unaudited)
	Successor			Predecessor
	September 30, 2016			December 31, 2015
ASSETS
CURRENT ASSETS:
Cash	$	117,782		$	365,221
Accounts receivable		1,348,290			1,091,953
Inventory		994,061			949,362
Prepaid expenses and other current assets		144,500			12,193
Total current assets		2,604,633			2,418,729
Property and equipment, net		4,976,261			166,263
Intangible asset, net		439,433			-
Goodwill		2,491,945			-
Other non-current assets		579,636			-
Total non-current assets		8,487,275			166,263
TOTAL ASSETS	$	11,091,908		$	2,584,992
LIABILITIES AND STOCKHOLDERS' EQUITY (DEFICIT)
CURRENT LIABILITIES:
Accounts payable	$	1,307,264		$	655,942
Accrued expenses		366,272			116,984
Deferred Revenue		-			202,049
Deposits		2,530			-
Notes payable		844,042			19,940
Notes payable, related parties		30,000			10,000
Convertible notes payable, net of discount of $49,319 and $0		361,457
Financing Lease Obligation		13,562
Total current liabilities		2,925,127			1,004,915
NON-CURRENT LIABILITIES:
Long-term debt		148,823			39,522
Convertible notes payable		1,801,551
Financing Lease Obligation		6,540,225			-
Deferred tax liability		346,310			66,970
Total non-current liabilities		8,836,909			106,492
TOTAL LIABILITIES		11,762,036			1,111,407
STOCKHOLDERS' EQUITY (DEFICIT):
Preferred stock, $0.0001 par value, 5,000,000 shares authorized, none issued and outstanding		-
Class A Common stock, $0.0001 par value, 500,000,000 shares authorized, 21,281,117 shares issued and outstanding		2,128
Class B Common stock, $0.0001 par value, 100,000,000 shares authorized, 1,600,000 and 0 shares issued and outstanding		160
Predecessor Common stock					240,000
Additional paid-in capital		15,652,220
Dividends		-			(129,253	)
Accumulated earnings/(deficit)		(16,324,636	)		1,362,838
Total stockholders' equity/(deficit)		(670,128	)		1,473,585
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY (DEFICIT)	$	11,091,908		$	2,584,992

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

4

ALPINE 4 TECHNOLOGIES, LTD. and SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS
(unaudited)
	Successor			Predecessor
	Three Months Ended  September 30, 2016			Three Months  Ended  September 30, 2015
Revenue	$	2,258,099		$	1,824,719
Cost of revenue		1,410,772			1,427,514
Gross Profit		847,327			397,205
Operating expenses:
General and administrative expenses		937,449			279,856
Depreciation		104,455			33,492
Amortization		10,901			-
Total operating expenses		1,052,805			313,348
Gain (Loss) from operations		(205,478	)		83,857
Other expenses
Interest expense		366,825			555
Other expenses/(income)		(49,173	)
Total other expenses		317,652			555
Gain (Loss) before income tax		(523,130	)		83,302
Income tax expense (benefit)		(964	)		43,339
Net Income (loss)	$	(522,166	)	$	39,963
Weighted average shares outstanding :
Basic		22,842,265
Diluted		22,842,265			-
Loss per share
Basic	$	(0.02	)	$
Diluted	$	(0.02	)	$

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

5

ALPINE 4 TECHNOLOGIES, LTD. and SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS
(unaudited)
	Nine month period
	Successor			Predecessor
	Period from April, 1, 2016 to September 30,  2016			Period from January, 1, 2016 to  March 31, 2016			Nine Months  Ended September 30, 2015
Revenue	$	4,294,535		$	1,788,654		$	5,971,309
Cost of revenue		2,730,395			1,337,083			4,615,800
Gross Profit		1,564,140			451,571			1,355,509
Operating expenses:
General and administrative expenses		2,858,163			490,091			1,189,649
Depreciation		175,625			33,492			100,475
Amortization		21,734			-			-
Total operating expenses		3,055,522			523,583			1,290,124
Gain (Loss) from operations		(1,491,382	)		(72,012	)		65,385
Other expenses
Interest expense		627,515			456			1,822
Other expenses/(income)		(101,121	)
Total other expenses		526,394			456			1,822
Gain (Loss) before income tax		(2,017,776	)		(72,468	)		63,563
Income tax expense (benefit)		7,411			(31,770	)		78,277
Net loss	$	(2,025,187	)	$	(40,698	)	$	(14,714	)
Weighted average shares outstanding :
Basic		22,760,422
Diluted		22,760,422			-			-
Loss per share
Basic	$	(0.09	)	$			$
Diluted	$	(0.09	)	$			$

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

6

ALPINE 4 TECHNOLOGIES, LTD. and SUBSIDIARIES
CONSOLIDATED STATEMENT OF CASH FLOWS
(unaudited)
	Nine month period
	Successor			Predecessor
	Period from April, 1, 2016 to  September 30, 2016			Period from January, 1, 2016 to March 31, 2016			Nine Months Ended September 30, 2015
OPERATING ACTIVITIES:
Net loss	$	(2,025,187	)	$	(40,698	)	$	(14,714	)
Adjustments to reconcile net loss to net cash used in operating activities:
Depreciation		175,625			33,492			100,475
Amortization		21,734
Employee stock compensation		1,062,500
Stock issued for services		406,740
Amortization of debt issuance		4,493
Amortization of debt discounts		226,913
Change in current assets and liabilities:
Accounts receivable		(303,735	)		(3,466	)		(83,595	)
Inventory		179,293			(423	)		(304	)
Prepaids		(110,748	)		(41,342	)		(17,352	)
Accounts payable		149,813			(3,314	)		143,689
Accrued expenses		244,388			24,461			(27,531	)
Deferred revenue		(998	)		-			202,049
Taxes payable		-			(41,645	)		(164,068	)
Net cash provided (used) in operating activities		30,831			(72,935	)		138,649
INVESTING ACTIVITIES:
Capital expenditures		(169,500	)					(14,024	)
Acquisition, net of cash acquired		(2,800,000	)
Net cash used by investing activities		(2,969,500	)		-			(14,024	)
FINANCING ACTIVITIES:
Proceeds from issuances of notes payable, related party		-						45,000
Proceeds from issuances of notes payable, non-related party		2,499,847
Repayments issuances of notes payable, non-related party		(1,834,482	)
Repayments of notes, related party		(1,535	)		(10,000	)		-
Repayments of notes payable, non-related party		(43,323	)		(59,461	)		(14,437	)
Proceeds from convertible notes payable		12,500
Proceeds from the sale of common stock		6,000
Net Proceeds from financing lease obligation, net of commissions and financing charges		2,704,260
Change in restricted cash		(532,969	)
Cash paid for rent deposit on lease of building		(46,667	)
Cash paid on financing lease obligation		(49,966	)
Net cash provided (used) by financing activities		2,713,665			(69,461	)		30,563
NET INCREASE (DECREASE) IN CASH		(225,004	)		(142,396	)		155,188
CASH, BEGINNING BALANCE		342,786			365,221			224,290
CASH, ENDING BALANCE	$	117,782		$	222,825		$	379,478
CASH PAID FOR:
Interest	$	217,791		$	456		$	1,841
Income taxes	$	-		$	47,500		$	308,652
SUPPLEMENTAL DISCLOSURE OF NON-CASH FINANCING ACTIVITIES:
Common stock issued for convertible note payable and accrued interest	$	159,830		$	-		$	-
Issuance of note payable for acquisition of QCA	$	2,000,000		$	-		$	-
Purchase of building from lease proceeds	$	3,895,000		$	-		$	-
Debt discount from convertible note payable	$	113,810		$	-		$	-

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

7

Alpine 4 Technologies Ltd.

Notes to Consolidated Financial Statements

For the Nine Months Ended September 30, 2016

(Unaudited)

Note 1 – Organization and Basis of Presentation

The unaudited financial statements were prepared by Alpine 4 Technologies Ltd. (the "Company"), pursuant to the rules and regulations of the Securities Exchange Commission ("SEC"). The information furnished herein reflects all adjustments (consisting of normal recurring accruals and adjustments) which are, in the opinion of management, necessary to fairly present the operating results for the respective periods. Certain information and footnote disclosures normally present in annual financial statements prepared in accordance with accounting principles generally accepted in the United States of America ("U.S. GAAP") were omitted pursuant to such rules and regulations. These financial statements should be read in conjunction with the audited financial statements and footnotes included in the Company's Annual Report on Form 10-K filed with the SEC on March 28, 2016. The results for the nine months ended September 30, 2016, are not necessarily indicative of the results to be expected for the year ending December 31, 2016.

Description of Business

Alpine 4 Technologies Ltd. (the "Company") was incorporated under the laws of the State of Delaware on April 22, 2014.  The Company was formed to serve as a vehicle to affect an asset acquisition, merger, exchange of capital stock, or other business combination with a domestic or foreign business.  As of the date of this Report, the Company was a technology holding company with a heavy concentration in the automotive industry. The Company provides a distinctive and powerful advantage to management, sales, finance, and service departments at automotive dealerships in order to increase productivity, profitability and customer retention through the Company's flagship program, 6th Sense Auto. The 6th Sense Auto program uses disruptive technology to improve inventory management, reduce costs, increase sales and enhance service. The 6th Sense Auto program serves a two-fold solution addressing both business to business and business to consumer market needs.

Acquisition Reporting

As discussed in note 9, the Company entered into a stock purchase transaction with Quality Circuit Assembly, Inc. ("QCA") in which the Company purchased 100% of QCA's stock.

The consolidated financial statements herein are presented under predecessor entity reporting and because the acquiring entity had nominal operations as compared with the acquired company, QCA, prior historical information of the acquirer is not presented.

This new basis of accounting was created on April 1, 2016, the effective date for financial reporting purposes of the stock purchase agreement.  In the following discussion, the results of the operations and cash flows for the periods ended on or prior to March 31, 2016, and the financial position of QCA as of balance sheet date on or prior to March 31, 2016 are referred to as "Predecessor" financial information, and the results of operations and cash flows of the Company for periods beginning April 1, 2016 and the financial position of the Company as of April 1, 2016 and subsequent balance sheet dates are referred to herein as "Successor" consolidated financial information.

8

Note 2 - Summary of Significant Accounting Policies

Principles of consolidation

The consolidated financial statements include the accounts of the Company and its wholly-owned subsidiaries as of September 30, 2016 (Successor) and December 31, 2015 (Predecessor).  Significant intercompany balances and transactions have been eliminated.

Basis of presentation

The accompanying financial statements present the balance sheets, statements of operations, stockholders' deficit and cash flows of the Company. The financial statements have been prepared in accordance with U.S. GAAP.

Use of estimates

The preparation of financial statements in conformity with U.S. GAAP requires the Company to make estimates and judgments that affect the reported amounts of assets and liabilities, revenues and expenses, and related disclosures of contingent assets and liabilities.  These estimates and judgments are based on historical information, information that is currently available to the Company and on various other assumptions that the Company believes to be reasonable under the circumstances.  Actual results could differ from those estimates.

Cash

Cash and cash equivalents consist of cash and short-term investments with original maturities of less than 90 days.  Cash equivalents are placed with high credit quality financial institutions and are primarily in money market funds.  The carrying value of those investments approximates fair value.

Major Customers

For all periods presented the Company had two customers that made up approximately 50% of total revenues.  All other customers were less than 10% each of total revenues in each period.

For all periods presented the Company had two customers that made up approximately 50% of outstanding accounts receivable.  All other customers were less than 10% each of total accounts receivable for each period presented.

Accounts Receivable

The Company maintains reserves for potential credit losses on accounts receivable. Management reviews the composition of accounts receivable and analyzes historical bad debts, customer concentrations, customer credit worthiness, current economic trends and changes in customer payment patterns to evaluate the adequacy of these reserves. Reserves are recorded primarily on a specific identification basis.

Inventory

Inventory is valued at the lower of the inventory's cost (weighted average basis) or market. Management compares the cost of inventory with its market value and an allowance is made to write down inventory to market value, if lower.  Inventory is segregated into four areas, raw materials, WIP, finished goods, and In-Transit.  Below is a breakdown of how much inventory is in each area as of September 30, 2016 (Successor) and December 31, 2015 (Predecessor).

	Sep 30, 2016 (Successor)		December 31, 2015 (Predecessor)
Raw materials	$	421,970	$	391,845
WIP		246,226		351,697
Finished goods		312,865		192,820
In Transit		13,000		13,000
	$	994,061	$	949,362

9

Property and Equipment

Property and equipment are carried at cost less depreciation. Depreciation and amortization are provided principally on the straight-line method over the estimated useful lives of the assets, which range from five years to 39 years as follows:

Buildings	39 years
Equipment	5 years

Maintenance and repair costs are charged against income as incurred.  Significant improvements or betterments are capitalized and depreciated over the estimated life of the asset.

Below is a table of Property and Equipment

Property and Equipment
	Sep 30, 2016 (Successor)			Dec 31, 2015 (Predecessor)
Machinery & Equipment	$	1,256,885		$	1,191,843
Office furniture & fixtures		-			164,868
Building		3,895,000			-
Less: Accumulated Depreciation		(175,624	)		(1,190,448	)
	$	4,976,261		$	166,263

Purchased Intangibles and Other Long-Lived Assets

The Company amortizes intangible assets with finite lives over their estimated useful lives, which range between five and fifteen years as follows:

Leasehold Improvements	15 years
Non-compete agreements	5 years
Software development	5 years

Below are tables for Intangibles and Other Long-Lived Assets

Intangibles
	Sep 30, 2016 (Successor)			Dec 31, 2015 (Predecessor)
Leasehold Improvements	$	140,200		$	-
Software		179,300			-
Noncompete		100,000			-
Other		50,000			-
Less: Accumulated Amortization		(30,067	)		-
	$	439,433		$	-

10

Other Intangibles consist of QCA's trade name, long lived customer relationships and customer lists.

Other Non-Current Assets
	Sep 30, 2016 (Successor)		Dec 31, 2015 (Predecessor)
Restricted Cash	$	525,270	$	-
Deposits		54,366		-
	$	579,636	$	-

Impairment of Long-Lived Assets

The Company accounts for long-lived assets in accordance with the provisions of FASB Topic 360, "Accounting for the Impairment of Long-Lived Assets".  This statement requires that long-lived assets and certain identifiable intangibles be reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable.  An impairment loss would be recognized when the estimated future cash flows from the use of the asset are less than the carrying amount of that asset.  During the three and six months ended September 30, 2016 (Successor), the period from January 1, 2016 through March 31, 2016 (Predecessor) and the nine months ended September 30, 2015 (Predecessor), there have been no impairment losses.

Goodwill

In financial reporting goodwill is not amortized, but is tested for impairment annually in the fourth quarter of the fiscal year or whenever events or changes in circumstances indicate that the carrying amount may not be recoverable.  Events that result in an impairment review include significant changes in the business climate, declines in our operating results, or an expectation that the carrying amount may not be recoverable.  We assess potential impairment by considering present economic conditions as well as future expectations.

We review goodwill for impairment by performing a two-step goodwill impairment test.  The first step of the two-step goodwill impairment test is to compare the fair value of the reporting unit to its carrying amount, including goodwill.  If the carrying amount of the reporting unit exceeds its fair value, the second step of the two-step goodwill impairment test is required to measure the goodwill impairment loss.

The second step includes valuing all the tangible and intangible assets of the reporting unit as if the reporting unit had been acquired in a business combination.  Then, the implied fair value of the reporting unit's goodwill is compared to the carrying amount of that goodwill.  If the carrying amount of the reporting unit's goodwill exceeds the implied fair value of the goodwill, we recognize an impairment loss in an amount equal to the excess, not to exceed the carrying amount.

The Company has recorded no impairment of goodwill in any period presented.

Fair Value Measurement

The Company's financial instruments consist of cash and cash equivalents, accounts receivable, accounts payable, accrued expenses, convertible notes, notes and line of credit.  The carrying amount of these financial instruments approximates fair value due either to length of maturity or interest rates that approximate prevailing market rates unless otherwise disclosed in these financial statements.

Revenue Recognition

The Company has a portfolio of consumer and professional software applications called 6thSenseAuto, which consists primarily of the Company's two products previously branded as LotWatch™ and ServiceWatch™.

11

LotWatch™ is a product for dealerships to give them vehicle inventory information. Our telematics devices use information gathered from the OBD (On Board Diagnostics) port, and by utilizing both GPS technology and cellular based service, the LotWatch™ module provides specific, real-time, accurate information about a dealership's fleet of new vehicles. This information can be easily accessed and viewed on Alpine 4's interface anywhere the dealership have internet access.

ServiceWatch™ is a product for the driving consumer that also uses information gathered from the OBD port.  By utilizing both GPS technology and cellular based service, the ServiceWatch™ module provides vehicle specific real-time, accurate information to a dealership's service department to increase sales all while improving their level of service.

When the Company enters into an agreement with a car dealership that wants to utilize its LotWatch™ service, a telematics device must be installed in each vehicle.  The Company will generally charge the car dealership a flat fee to install its telematics device in each vehicle.  The Company recognizes revenue when all the devices have been installed.  At the end of each month, the Company will charge the dealership a fee based on the average number of cars on the dealer's lot during the month and revenue is recognized at that time (end of the month).

The Company will account for its revenue per the guidance in ASC 605-25-25 by allocating the total contract amount between the product and service elements.  When a vehicle is sold to the driving consumer who purchases the ServiceWatch™ service, the cost of the service is added to the price of the car and the amount collected by the dealership for this service is remitted to the Company.  At the time of the vehicle is purchased, the Company recognizes revenue for the retail value of the telematics device that has been installed in the vehicle and the remaining amount is recognized over the service period of generally 24 to 36 months.

The Company also derives revenue from the sale of circuit boards and wire harnesses and recognizes revenue either FOB Origin or FOB Destination dependent upon the contract with the customer.

We consider revenue recognizable when persuasive evidence of an arrangement exists, the price is fixed or determinable, goods or services have been shipped or delivered, and collectability is reasonably assured. These criteria are assumed to have been met if a customer orders an item, the goods or services have been shipped or delivered to the customer, and we have sufficient evidence of collectability, such a payment history with the customer.  Our records for all periods presented have been sufficient to satisfy all of the four requirements.

Leases

Leases are reviewed by management and examined to see if they are required to be categorized as an operating lease, a capital lease or a financing transaction.

Earnings (loss) per share

Basic earnings (loss) per common share is computed by dividing net income (loss) available to common shareholders by the weighted-average number of shares of common stock outstanding during the period. Diluted earnings per common share is computed by dividing income available to common shareholders by the weighted-average number of shares of common stock outstanding during the period increased to include the number of additional shares of common stock that would have been outstanding if potentially dilutive securities had been issued. The only potentially dilutive securities outstanding during the periods presented were the convertible notes payable , but they are anti-dilutive due to the net loss incurred.

Stock-based compensation

The Company accounts for equity instruments issued in exchange for the receipt of goods or services from other than employees in accordance with Financial Accounting Standards Board ("FASB") Accounting Standards Codification ("ASC") 718-10, Compensation – Stock Compensation, and the conclusions reached by FASB ASC 505-50, Equity – Equity-Based Payments to Non-Employees. Costs are measured at the estimated fair market value of the consideration received or the estimated fair value of the equity instruments issued, whichever is more reliably measurable. The value of equity instruments issued for consideration other than employee services is determined on the earliest of a performance commitment is reached or completion of performance by the provider of goods or services as defined by FASB ASC 505-50.

12

Income taxes

The Company records income taxes under the asset and liability method, whereby deferred tax assets and liabilities are recognized based on the future tax consequences attributable to temporary differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases, and attributable to operating loss and tax credit carry forwards. Accounting standards regarding income taxes requires a reduction of the carrying amounts of deferred tax assets by a valuation allowance, if based on the available evidence, it is more likely than not that such assets will not be realized. Accordingly, the need to establish valuation allowances for deferred tax assets is assessed at each reporting period based on a more-likely-than-not realization threshold. This assessment considers, among other matters, the nature, frequency and severity of current and cumulative losses, forecasts of future profitability, the duration of statutory carry forward periods, the Company's experience with operating loss and tax credit carry forwards not expiring unused, and tax planning alternatives.

The Company recorded valuation allowances on the net deferred tax assets.  Management will reassess the realization of deferred tax assets based on the accounting standards for income taxes each reporting period. To the extent that the financial results of operations improve and it becomes more likely than not that the deferred tax assets are realizable, the Company will be able to reduce the valuation allowance.

Significant judgment is required in evaluating the Company's tax positions and determining its provision for income taxes. During the ordinary course of business, there are many transactions and calculations for which the ultimate tax determination is uncertain. Accounting standards regarding uncertainty in income taxes provides a two-step approach to recognizing and measuring uncertain tax positions. The first step is to evaluate the tax position for recognition by determining if the weight of available evidence indicates it is more likely than not that the position will be sustained on audit, including resolution of related appeals or litigation processes, if any. The second step is to measure the tax benefit as the largest amount which is more than 50% likely, based solely on the technical merits, of being sustained on examinations. The Company considers many factors when evaluating and estimating its tax positions and tax benefits, which may require periodic adjustments and which may not accurately anticipate actual outcomes.

Embedded Conversion Features

The Company evaluates embedded conversion features within convertible debt under ASC 815 "Derivatives and Hedging" to determine whether the embedded conversion feature(s) should be bifurcated from the host instrument and accounted for as a derivative at fair value with changes in fair value recorded in earnings.  If the conversion feature does not require derivative treatment under ASC 815, the instrument is evaluated under ASC 470-20 "Debt with Conversion and Other Options" for consideration of any beneficial conversion features.

Related Party Disclosure

FASB ASC 850, "Related Party Disclosures" requires companies to include in their financial statements disclosures of material related party transactions. The Company discloses all material related party transactions. Related parties are defined to include any principal owner, director or executive officer of the Company and any immediate family members of a principal owner, director or executive officer.

Recent Accounting Pronouncements

In May 2014, the FASB issued Accounting Standards Update ("ASU") No. 2014-09 (ASU 2014-09), Revenue from Contracts with Customers. ASU 2014-09 will eliminate transaction- and industry-specific revenue recognition guidance under current US GAAP and replace it with a principle based approach for determining revenue recognition. ASU 2014-09 will require that companies recognize revenue based on the value of transferred goods or services as they occur in the contract. The ASU also will require additional disclosure about the nature, amount, timing and uncertainty of revenue and cash flows arising from customer contracts, including significant judgments and changes in judgments and assets recognized from costs incurred to obtain or fulfill a contract. ASU 2014-09 is effective for reporting periods beginning after December 15, 2016, and early adoption is not permitted. Entities can transition to the standard either retrospectively or as a cumulative-effect adjustment as of the date of adoption. Management is currently assessing the impact the adoption of ASU 2014-09 and has not determined the effect of the standard on our ongoing financial reporting.

13

In August 2015, the FASB issued ASU No. 2015-14, Revenue from Contracts with Customers (Topic 606): Deferral of the Effective Date. The amendment in this ASU defers the effective date of ASU No. 2014-09 for all entities for one year. Public business entities, certain not-for-profit entities, and certain employee benefit plans should apply the guidance in ASU 2014-09 to annual reporting periods beginning December 15, 2017, including interim reporting periods within that reporting period. Earlier application is permitted only as of annual reporting periods beginning after December 15, 2016, including interim reporting periods with that reporting period.

In February 2015, the FASB issued ASU No. 2015-02, Consolidation (Topic 810): Amendments to the Consolidation Analysis. ASU 2015-02 provides guidance on the consolidation evaluation for reporting organizations that are required to evaluate whether they should consolidate certain legal entities such as limited partnerships, limited liability corporations, and securitization structures (collateralized debt obligations, collateralized loan obligations, and mortgage-backed security transactions). ASU 2015-02 is effective for periods beginning after December 15, 2015. The adoption of ASU 2015-02 is not expected to have a material effect on the Company's financial statements. Early adoption is permitted.

In September, 2015, the FASB issued ASU No. 2015-16, Business Combinations (Topic 805).  Topic 805 requires that an acquirer retrospectively adjust provisional amounts recognized in a business combination, during the measurement period. To simplify the accounting for adjustments made to provisional amounts, the amendments in the Update require that the acquirer recognize adjustments to provisional amounts that are identified during the measurement period in the reporting period in which the adjustment amount is determined. The acquirer is required to also record, in the same period's financial statements, the effect on earnings of changes in depreciation, amortization, or other income effects, if any, as a result of the change to the provisional amounts, calculated as if the accounting had been completed at the acquisition date.  In addition, an entity is required to present separately on the face of the income statement or disclose in the notes to the financial statements the portion of the amount recorded in current-period earnings by line item that would have been recorded in previous reporting periods if the adjustment to the provisional amounts had been recognized as of the acquisition date.  The adoption of ASU 2015-016 is not expected to have a material effect on the Company's financial statements.

In November 2015, the FASB issued ASU No. 2015-17, Balance Sheet Classification of Deferred Taxes. The new guidance requires that all deferred tax assets and liabilities, along with any related valuation allowance, be classified as noncurrent on the balance sheet. This update is effective for annual periods beginning after December 15, 2016 and interim periods within those annual periods. The Company does not anticipate the adoption of this ASU will have a significant impact on its financial position, results of operations, or cash flows.

In February 2016, the FASB issued ASU No. 2016-02, Leases (Topic 842). The guidance in ASU No. 2016-02 supersedes the lease recognition requirements in ASC Topic 840, Leases (FAS 13). ASU 2016-02 requires an entity to recognize assets and liabilities arising from a lease for both financing and operating leases, along with additional qualitative and quantitative disclosures. ASU 2016-02 is effective for fiscal years beginning after December 15, 2018, with early adoption permitted. The Company is currently evaluating the effect this standard will have on its financial statements.

Other recent accounting pronouncements issued by the FASB, including its Emerging Issues Task Force, the American Institute of Certified Public Accountants, and the Securities and Exchange Commission did not or are not believed by management to have a material impact on the Company's present or future financial statements.

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Note 3 – Going Concern

The accompanying financial statements have been prepared on a going concern basis, which contemplates the realization of assets and the satisfaction of liabilities in the normal course of business. The Company has incurred losses since inception.  The Company requires capital for its contemplated operational and marketing activities.  The Company's ability to raise additional capital through the future issuances of common stock is unknown. The obtainment of additional financing, the successful development of the Company's contemplated plan of operations, and its transition, ultimately, to the attainment of profitable operations are necessary for the Company to continue operations. The ability to successfully resolve these factors raise some doubt about the Company's ability to continue as a going concern. The financial statements of the Company do not include any adjustments that may result from the outcome of these aforementioned uncertainties.

In order to mitigate the risk related with this uncertainty, the Company has a three-fold plan to resolve these risks.  First the acquisition of QCA has allowed for an increased level of cash flow to the Company as demonstrated in the sales for Q2 and Q3.  Second, the Company is close to acquiring another company that, like QCA, will increase income and cash flow to the Company.  Third, the Company plans to issue additional shares of common stock for cash and services during the next 12 months and has engaged MCAP, LLC to provide advisory services to that capital raise.

Note 4 – Leases

During the nine months ending September 30, 2016 (Successor) the Company entered into a financing transaction for a building.  The Company bought ($3,895,000) and sold ($7,000,000) the property to an unrelated third-party real estate company and simultaneously entered into an arrangement with the third-party real estate company to lease back the property.  Since the leaseback was not a normal leaseback this transaction is recorded as a financing transaction with the asset and related financing obligation recorded on the balance sheet.  The lease has a 15-year term expiring in 2031 and certain default provisions requiring the Company to perform repairs and maintenance, make timely rent payments and insure the building.  The Company also issued a letter of credit for $525,270 in favor of the landlord; the letter of credit is collateralized by a savings account which is classified as restricted cash under non-current assets.  The liability under the financing transaction as of September 30, 2016 (Successor) totals $9,855,790.  Imputed interest of $3,302,003 is being amortized over the lease term.  The Company paid costs of $54,898 and a commission of $350,000 in conjunction with the transaction, which is characterized as debt issuance costs and will be amortized over the lease term.  The current unamortized balance of the debt issuance costs is $349,028 and in accordance with ASU 2015-03 debt issuance costs are reflected as a contra-liability reducing the related financing lease obligation.

As of September 30, 2016 (Successor) the future minimum capital lease and financing transaction payments, net of amortization of debt issuance costs, are as follows:

Fiscal Year
2016	$	140,999
2017		571,499
2018		584,763
2019		599,382
2020		614,366
Thereafter		7,344,781
Total		9,855,790
Less: Current leases financing obligation		(13,562	)
Less: imputed interest		(3,302,003	)
Noncurrent leases financing obligation	$	6,540,225

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The Company also has a commitment to pay $276,000 towards Leasehold Improvements of which $138,000 has been satisfied and reflected on the balance sheet as of September 30, 2016 (Successor).

The money received from the sale of the building was used to purchase Quality Circuit Assembly.  Since this is a financing transaction the sale is recorded under financing obligation lease on the Balance Sheet and amortized over the 15-year term of the lease.

Note 5 – Notes Payable

During the nine months ended September 30, 2016 (Successor) the Company secured a line of credit with a third-party lender, of which $327,500 was received in Q1.  The line of credit is collateralized by QCA's outstanding accounts receivable, up to 80%, and inventory with maximum draws of $2,000,000 and $125,000, respectively, and a variable interest rate.  The Company also secured a five-year variable interest rate term loan with Celtic which is collateralized by QCA's equipment.  As of September 30, 2016 (Successor) the outstanding balances for the loans are as follows:

	September 30,  2016 (Successor)
Line of credit current	$	713,265
Inventory current		96,000
Equipment current		34,777
Total Current	$	844,042
Equipment noncurrent		148,823
Total Notes	$	992,865

Note 6 – Notes Payable, Related Parties

At September 30, 2016 (Successor), and December 31, 2015 (Predecessor), notes payable consisted of the following:

	September 30,		December 31,
	2016 (Successor)		2015 (Predecessor)
Note payable; non-interest bearing; due upon demand; unsecured		0		10,000
Note payable; non-interest bearing; due upon demand; unsecured		15,000		0
Note payable; non-interest bearing; due upon demand; unsecured		15,000		0
	$	30,000	$	10,000

During the three months ended September 30, 2016 (Successor) a note with a related party was amended with a conversion option (see Note 7 for convertible notes description).  The amendment resulted in extinguishment of the original note because a conversion feature was added.  Management has evaluated the conversion option for derivative accounting consideration under ASC Topic 815-40, Derivatives and Hedging – Contracts in Entity's Own Stock and concluded that the conversion option meets the criteria for classification in stockholders' equity. Therefore, derivative accounting is not applicable for the conversion option.  Management also evaluated the conversion feature for whether it was beneficial as described in ASC Topic 470-30 and concluded it was beneficial because the conversion price at commitment date was less than the fair value of the Company's common stock.  The note converted during the three months ended September 30, 2016 (Successor) and thus the BCF discount was expensed to interest expense in its entirety.

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Note 7 – Convertible Notes Payable

During the nine months ended September 30, 2016 (Successor) and year ended December 31, 2015 (Predecessor), the Company entered into convertible note agreements with investors.  The convertible notes are unsecured; bear interest at 5-20% annually, and are due from April 27, 2016, to July 1, 2019.  All of the convertible notes payable contain a provision that allows the note holder to convert the outstanding balance into shares of the Company's common stock.  Notes are convertible at $1.00 per share, except for those issued for a business acquisition, which are convertible at $10.00 per share.  The debt discount, which arises from a beneficial conversion feature ("BCF") on the $1 per share investor notes, is being amortized over the terms of the convertible notes payable.  Total BCF discount is $113,810 for the six months ended September 30, 2016 (Successor).  For the three months ended September 30, 2016 (Successor), the Company recognized interest expense of $139,748 related to the amortization of the debt discount.  Company has evaluated Embedded Conversion Feature for convertible notes and BCF discount has a balance of $49,319 at September 30, 2016.

Convertible notes payable at September 30, 2016 (Successor) and December 31, 2015 (Predecessor), consisted of the following:

	Sep 30, 2016 (Successor)			Dec 31, 2015 (Predecessor)
Convertible Note - current	$	410,776		$	-
Debt discount		(49,319	)		-
Net current	$	361,457		$	-
Convertible Note - noncurrent		1,801,551			-
Total Convertible Note	$	2,163,008		$	-

See Note 9 "Business Combination" for details on $2,000,000 convertible note.

A roll forward of the convertible notes payable is provided below:

Balance outstanding, April 1, 2016 (Successor)	$	131,928
Issuance of convertible notes payable for acquisition		2,000,000
Issuance of convertible notes payable for cash		12,500
Notes paid		(43,323	)
Conversion of notes payable to common stock		(51,200	)
Discount from beneficial conversion feature		(113,810	)
Amortization of debt discount		226,913
Balance outstanding, September 30, 2016 (Successor)               $		2,163,008

Note 8 – Stockholders' Equity

Preferred Stock

The Company is authorized to issue 5,000,000 shares of $.0001 par value preferred stock. As of November 11, 2016, no shares of preferred stock were outstanding.

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Common Stock

Pursuant to the Second Amended and Restated Certificate of Incorporation, the Company is authorized to issue two classes of common stock: Class A common stock, which will have one vote per share, and Class B common stock, which will have ten votes per share. Any holder of Class B common stock may convert his or her shares at any time into shares of Class A common stock on a share-for-share basis. Otherwise the rights of the two classes of common stock will be identical.

The Company had the following transactions in its common stock during the six months ended September 30, 2016:

· issued 200,548 (157,000 to related parties) shares of its Class A common stock for services, of the related party shares 107,000 are fully vested with 50,000 vesting from April 18, 2016 to April 18, 2017.  Unrecognized compensation for the unvested share is $212,500 which will be recognized over the vesting period;

· issued 159,830 (101,310 to a related party on conversion of principal of $92,100 and accrued interest of $9,210) shares of its Class A common stock in connection with the conversion of convertible notes payable and accrued interest;

· issued 670 shares of the Company's restricted Class A common stock in private placement transactions to investors, in exchange for capital raised of $6,000.

There were no equity transactions related to the Predecessor Company during any Predecessor period presented.

Reverse Stock Split

On July 29, 2016 the Company adopted a resolution approved by the shareholders to issue a reverse stock split at a ratio of one (1) new share for each ten (10) old shares of the Company's commons stock (the "Reverse Split").  By its terms, the Reverse Split would only reduce the number of outstanding shares of Class A and Class B common stock, and would not correspondingly reduce the number of Class A and Class B common shares authorized for issuance, which remained at 500,000,000 and 100,000,000, respectively.

The financial statements have been retrospectively restated to reflect the reverse split.

Note 9 – Business Combination

Effective April 1, 2016 the Company Purchased 100% of the stock of Quality Circuit Assembly, Inc., a California company ("QCA").

The purchase price paid by the Company for the QCA Shares consists of cash, and a convertible promissory note.   The "Cash Consideration" paid was the aggregate amount of $3,000,000.  The "Promissory Note Consideration" consists of a secured promissory note (the "Quality Circuit Assembly Note") in the amount of $2,000,000 ($160,126 current, $1,801,551 noncurrent), secured by a subordinated security interest in the assets of QCA.  Additionally, the Sellers have the opportunity to convert the Quality Circuit Assembly Note into shares of the Company's Class A common stock at a conversion price of $10 per share after 12 months.  The Quality Circuit Assembly Note will bear interest at 5% with first payment due July 1, 2016, and will be payable in full in 36-months (namely, July 1, 2019).

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A summary of the preliminary purchase price allocation at fair value is below.

	Purchase Allocation
Cash	$	200,000
Accounts Receivable		1,044,375
Inventory		950,424
Property, Plant & Equipment		1,256,885
Prepaid		53,535
Intangibles		150,000
Goodwill		2,491,945
Accounts Payable		(672,410	)
Accrued Expenses		(128,444	)
Deferred Tax Liability		(346,310	)
	$	5,000,000

Preliminary purchase price allocation is pending finalization of tax effect on intangibles.  During three months ended September 30, 2016 (Predecessor) an adjustment was made to the purchase price allocation based on additional information.  Accounts receivable decreased by $51,044, Inventory increased by $19,641, Accounts Payable increased by $19,782 and Goodwill increased by $51,185.

Unaudited pro forma result of operations for the three months ended March 31, 2016 and the three and nine months ended September 30, 2015 as if the Companies had been combined as of January 1, 2015, follow.  The pro forma results include estimates and assumptions which management believes are reasonable.  However, pro forma results do not include any anticipated cost savings or other effects of the planned integration of these entities, and are not necessarily indicative of the results that would have occurred if the business combination had been in effect on the dates indicated or which may result in the future.  For periods ending June 30, 2016 and September 30, 2016 pro forma information is not provided because the results after March 31, 2016 are post-acquisition.

	Pro Forma Combined Financials
	Three Months  Ended  March 31, 2016			Three Months  Ended September 30, 2015			Nine Months Ended September 30, 2015
Revenue	$	1,795,769		$	1,827,630		$	5,974,220
Net (Loss) Income	$	(330,933	)	$	(2,371,293	)	$	(11,036,240	)
Net (Loss) Income per Common Share - Basic and Diluted	$	(0.02	)	$	(0.35	)	$	(1.39	)

For the three months and six months ending September 30, 2016 QCA has contributed $2,244,498 and $4,213,114 of revenue, respectively and $106,555 and $147,337 of net income, respectively.

Note 10 – Subsequent Events

None

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Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations

There are statements in this Report that are not historical facts. These "forward-looking statements" can be identified by use of terminology such as "believe," "hope," "may," "anticipate," "should," "intend," "plan," "will," "expect," "estimate," "project," "positioned," "strategy" and similar expressions. You should be aware that these forward-looking statements are subject to risks and uncertainties that are beyond our control. For a discussion of these risks, you should read this entire Report carefully, especially the risks discussed under "Risk Factors." Although management believes that the assumptions underlying the forward looking statements included in this Report are reasonable, they do not guarantee our future performance, and actual results could differ from those contemplated by these forward looking statements. The assumptions used for purposes of the forward-looking statements specified in the following information represent estimates of future events and are subject to uncertainty as to possible changes in economic, legislative, industry, and other circumstances. As a result, the identification and interpretation of data and other information and their use in developing and selecting assumptions from and among reasonable alternatives require the exercise of judgment. To the extent that the assumed events do not occur, the outcome may vary substantially from anticipated or projected results, and, accordingly, no opinion is expressed on the achievability of those forward-looking statements. In the light of these risks and uncertainties, there can be no assurance that the results and events contemplated by the forward-looking statements contained in this Report will in fact transpire. You are cautioned not to place undue reliance on these forward-looking statements, which speak only as of their dates. We expressly disclaim any obligation to update or revise any forward-looking statements.

Overview and Highlights

Company Background

Alpine 4 Technologies Ltd. (formerly ALPINE 4 Inc. and Alpine 4 Automotive Technologies Ltd.) (the "Company") was incorporated in the State of Delaware on April 22, 2014.  Between inception and August 2014, the Company was in the developmental stage and conducted virtually no business operations.  On August 5, 2014, the Company entered into a Licensing Agreement (the "License Agreement") with AutoTek Incorporated ("AutoTek").  Pursuant to the License Agreement, AutoTek granted to Alpine 4 an exclusive, transferable (including sub licensable) worldwide perpetual license of the source code that could be developed into the LotWatch and ServiceWatch Products, to make, use, and sell products incorporating the LotWatch and ServiceWatch products (the "Licensed Products").  The Company was required to pay to AutoTek royalty payments equal to $10 per ServiceWatch device activated using the Licensed Technology.

The Company and AutoTek worked together to complete the asset purchase transaction, which closed on February 4, 2016. Also on February 4, 2016, the Company closed a share exchange transaction with the AutoTek shareholders, pursuant to which AutoTek shareholders exchanged an aggregate of 25,000,000 shares of AutoTek common stock for 15,000,000 shares of the Company's Class A common stock.

Following the closing of the asset purchase transaction, the Company has continued to use the source code acquired from AutoTek, as well as targeting and acquiring other potential businesses and assets, and deploying those assets to the Company's customer base which consists of automotive dealerships in the United States.  The Company 4 has used AutoTek's source code to design, develop and market telematics devices and software for the Automotive Industry, as discussed in more detail below.  

Business Strategy

Who We Are

Alpine 4 is a publicly held enterprise with four principles at the core of its business: Synergy, Innovation, Drive, and Excellence (S.I.D.E).  At Alpine 4, we believe synergistic innovation drives excellence. By anchoring these words to our combined experience and capabilities, we are able to aggressively pursue opportunities within and across vertical markets. We deliver solutions that not only drive industry standards, but also increase value for our shareholders.

At Alpine 4, we understand the nature of how technology and innovation can accentuate a business. We strive to develop strategic synergies between our holdings to create value and operational excellence within a unique long-term perspective.

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Our Core Business

We are a technology holding company with a heavy concentration in the automotive industry. We provide a distinctive and powerful advantage to management, sales, finance and service departments at automotive dealerships in order to increase productivity, profitability and customer retention through our flagship program, 6thSenseAuto ("6SA") (formerly LotWatch and ServiceWatch, discussed in more detail below), which uses disruptive technology to improve inventory management, reduce costs, increase sales and enhance service. The 6SA program serves a two-fold solution addressing both business to business and business to consumer market needs. The 6SA product is discussed in more detail below.

Market Size and Growth

There are approximately 60,000 auto dealerships in the United States. This includes new car dealerships affiliated with an auto manufacturer and independent used car dealerships ranging from small lots to megadealers such as AutoNation. In 2014, 40.5 million used vehicles were sold, representing approximately two and half times the number of new vehicles sold. Moreover, total used vehicle sales by new car dealers increased 8 percent in 2014 to 15 million units in 2015, the highest level since 2005.  As such, with almost 55.5 million vehicles sold domestically each year, the Company's management believes that our 6SA program has a $12-billion-dollar market opportunity.

Diversification

In addition to our push for marketplace adoption of our 6SA product, we have also been actively pursuing diversification through planned acquisitions of other businesses, including the recent acquisition of Quality Circuit Assembly, Inc., a California corporation ("QCA") (discussed more below).   It is our goal to help drive Alpine 4 into a leading multi-faceted holding company with diverse products and services that not only benefit from one another as whole but also have the benefit of independence.  This type of corporate structure is about having our subsidiaries prosper through strong onsite leadership, while working synergistically with other Alpine 4 holdings.   Alpine 4 has been set up with a holding company model, with Presidents who will run each business, and Managers with specific industry related experience who, along with Kent Wilson, the CEO of Alpine 4, will help guide our portfolio of companies as needed.  Alpine 4 will work with our Presidents and Managers to ensure that our motto of S.I.D.E (Synergistic, Innovation, Drives, Excellence) is utilized.  Further, we plan to work with our subsidiaries and capital partners to provide the proper capital allocation and to work to make sure each business is executing at high levels.  

For the greater part of 2016, Alpine 4's primary interests will lie in the following: software, automotive technologies, electronics manufacturing, energy services and fabrication technologies; or those companies that support these industries.  At the core of our acquisition strategy is our focus on existing smaller middle market operating companies with revenues of $5 to $50 million.  In this target-rich environment, we believe that businesses generally sell at more reasonable multiples, present greater opportunities for operational and strategic improvements and have greater potential for growth.

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Developed Products

Alpine 4 has a portfolio of consumer and professional software applications called 6thSenseAuto ("6SA"), which consists primarily of the Company's two products previously branded as LotWatch™ and ServiceWatch™, which together are now presented as 6SA.

6th Sense Auto ("6SA") can provide automobile dealerships with industry-leading sales team management information.  Utilizing our proprietary business intelligence platform, 6SA can help dealership sales departments; track customers from the time they enter a dealer's lot; let sales managers know in real-time when a salesperson is with a customer, on a test drive; or permit dealers and managers to review vehicles in inventory.  The 6SA system delivers a wide range of operational efficiencies, which the Company believes will maximize everything dealership sales managers need to know into one unique dashboard.

- Sales Personnel Management System:  6SA comes with a revolutionary Sales Personnel App for IOS, Windows and Android, which gives a dealership's sales team the ability to search for any car in inventory, know exactly where it is at, and check to see if the battery is charged and if it has fuel.  This revolutionary app also allows dealership sales teams to intake information about the "deal" such as customer profile info, driver's license information, and all needed vehicle trade information (including pictures), and then simultaneously push that information to the sales department, used car manager, or whoever the dealership or management designates.

- Sales KPI Management Dashboards:  Anyone in management knows the challenges of managing multitudes of individuals.  The 6SA Sales Management Dashboard is essentially an enhanced virtual deal board.  It permits dealership management to get the latest up-to-date information on the sales team, how many customers are on the dealer's lot, how many test drives have occurred or are occurring, how many deals have been submitted, and much more.

- Remote Management:  This component allows dealership personnel to manage the team and inventory from their smartphones, computers, or tablets. The 6SA app and web based UI lets the management team manage from anywhere, on or off of the lot.

Inventory Management and Vehicle Location:  The 6SA Inventory Management System easily allows dealership personnel to locate vehicles in inventory so their sales team can easily guide a customer to the exact car they are looking for, which allows them to:

- Locate the exact vehicle(s) they are looking for and not have to search the lot;

- See if the vehicle has fuel and the battery is charged (Dead batteries kill deals!); and

- Respond to customer's inquiries more quickly and as a result, drive sales.

Customer Retention & Fix Ops Management:  The 6SA Customer Retention Platform ("CRP") provides vehicle-specific, real-time, accurate information to a dealership's service department.   According to data provided by the National Automobile Dealers Association, it is estimated that at least 30% percent of a new car dealership's profit comes from its service department, and as such, new car dealerships spend roughly $34 per month retaining a new customer!

6th Sense Auto Customer Retention Platform reduces that monthly expense by passing that expense to the consumer.

The CRP lets the service department know in real-time the status of a customer's vehicle.  The system can track information with respect to any Diagnostic Trouble codes ("DTC") or check engine lights, actual mileage of the vehicle, and if there are any recommended services that are needed at the time, and also communicates that information to the consumer via email, text, or phone.

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Management believes that this will increases a dealership's profitability by:

- Increasing quantity of Repair Orders;

- Bringing the customer back to the dealership more often; and

- Connecting the Customer and the Service Advisor in real-time every time their vehicle needs service or when a notification alert is sent.

Customer Vehicle Knowledge & Location System:  The 6SA Vehicle Knowledge & Location System is a consumer product that gives automobile owners real-time information about their car such as:

- Vehicle Location;

- DTC & Check Engine Lights;

- Service Alerts;

- Battery & Fuel Information Alerts;

- If their car is being towed;

- Exiting or Entering a Geo Fence; and

- Speed History.

As of the date of this Report, Alpine 4 had concluded installations at four automobile dealerships in Arizona, California, and Indiana for the 6SA system.

Alpine 4 personnel provide training in the installation of the devices, creation of the customized user interface, and use of the inventory management system.  Additionally, personnel introduce and explain the details of the products to a dealership's sales staff, train the finance managers on the benefits of ServiceWatch and the registration process, and provide other training and support as agreed upon with the dealership.

Going Concern

The accompanying financial statements have been prepared on a going concern basis, which contemplates the realization of assets and the satisfaction of liabilities in the normal course of business. The Company has incurred losses since inception.  The Company requires capital for its contemplated operational and marketing activities.  The Company's ability to raise additional capital through the future issuances of common stock is unknown. The obtainment of additional financing, the successful development of the Company's contemplated plan of operations, and its transition, ultimately, to the attainment of profitable operations are necessary for the Company to continue operations. The ability to successfully resolve these factors raises some doubt about the Company's ability to continue as a going concern. The financial statements of the Company do not include any adjustments that may result from the outcome of these aforementioned uncertainties.

In order to mitigate the risk related with this uncertainty, the Company has a three-fold plan to resolve these risks.  First the acquisition of QCA has allowed for an increased level of cash flow to the Company as demonstrated in the sales for Q2 and Q3.  Second, the Company is close to acquiring another company that, like QCA, will increase income and cash flow to the Company.  Third, the Company plans to issue additional shares of common stock for cash and services during the next 12 months and has engaged MCAP, LLC to provide advisory services to that capital raise.

Results of Operations 

Revenue

Our revenues were $4,294,535 for the six months ended September 30, 2016 (Successor) with the majority being from QCA and $1,788,654 for the three months ended March 31, 2016 (Predecessor).  This compares with $5,971,309 generated during the nine months ended September 30, 2015 (Predecessor).  Predecessor revenue is from circuit board and wire harness sales.  Successor revenues include these as well as the 6SA products and services.  The Company began selling the 6SA products and services during the second half of 2015, and expect our revenue to grow significantly over the next 12 months. Management's expectations of growth in revenues is based on management's contacts within the automobile dealership industry, and the anticipated increase in interest in Alpine 4's products and services as Alpine 4 increases its advertising and brand and product/service awareness campaigns beginning in the second quarter of 2015 and which will continue through 2016.   Management also expects revenue from circuit board and wire harness sales to increase over the next 12 months.  These expectations are a result of increased focus on acquiring new customers and growing current customer's orders.

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Cost of Revenue

Our cost of revenues was $2,730,395 for the six months ended September 30, 2016 (Successor) and $1,337,083 for the three months ended March 31, 2016 (Predecessor).  This compares with $4,615,800 for the nine months ended September 30, 2015 (Predecessor). We expect our cost of revenue to increase over the next 12 months as our revenue increases.  

General and administrative expenses

Our general and administrative expenses were $2,858,163 for the six months ended September 30, 2016 (Successor) and $490,091 for the three months ended March 31, 2016 (Predecessor).  This compares with $1,189,649 for the nine months ended September 30, 2015 (Predecessor).  For the nine months ended September 30, 2016 (Successor) and 2015 (Predecessor), $1,469,240 and $0 of our general and administrative expenses was a non-cash expense related to the issuance of our common stock for services, of which $1,062,500 was for employee stock compensation.  We expect that our overall general and administrative expenses will decrease over the next 12 months as we have completed awarding most of our anticipated employee stock plan.  As Alpine 4 increases its advertising and brand and product/service awareness campaigns beginning in the second half of 2016, and as Alpine 4 hires additional personnel as needed and as operations permit, management anticipates that such actions will result in increased expenses in these areas to the Company.  

Interest expense

Our interest expense was $627,515 for the six months ended September 30, 2016 (Successor) and $456 for the three months ended March 31, 2016 (Predecessor).  This compares with $1,822 for the nine months ended September 30, 2015 (Predecessor).   The increase in interest expense is due to the increase in debt, including convertible notes, along with interest costs associated with the purchase of QCA.  Interest expense includes the interest on the convertible debentures and the amortization of the debt discounts associated with the conversion features embedded in the convertible debentures.

Liquidity and Capital Resources

We have financed our operations since inception from the sale of common stock, capital contributions from stockholders, issuance of notes payable and convertible notes payable.  We expect to continue to finance our operations by selling shares of our common stock and by generating income from the sale of our products.  As noted above, management's expectations of growth in revenues is based on management's contacts within the automobile dealership industry, and the anticipated increase in interest in Alpine 4's products and services as Alpine 4 increases its advertising and brand and product/service awareness campaigns beginning in the third and fourth quarters of 2016.  Additionally, management anticipates that the new campaigns will result in the Company's adding new dealerships each month, which began in the second quarter and which should continue through the end of 2016.

Management expects to have sufficient working capital for continuing operations from either the sale of its products, its subsidiaries product and services' revenue, or through the raising of additional capital through private offerings of our securities. Additionally, as of the date of this Report, the Company was in negotiations to acquire two businesses, which management believes will provide additional operating revenues to the Company.  There can be no guarantee that the planned acquisitions will close or that they will produce the anticipated revenues on the schedule anticipated by management, or at all.

The Company generated cash from operating activities of $30,831 for the six months ended September 30, 2016 (Successor) and used cash of $72,935 for the three months ended March 31, 2016 (Predecessor).  This compares with cash generated of $138,649 for the nine months ended September 30, 2015 (Predecessor).  The increase is due to the increase of accounts receivable.

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The Company used cash from investing activities of $2,969,500 for the six months ended September 30, 2016 (Successor) and $0 for the three months ended March 31, 2016 (Predecessor).  This compares with $14,024 for the nine months ended September 30, 2015 (Predecessor).  The increase is due to the purchase of QCA.

The Company generated cash from financing activities of $2,713,665 for the six months ended September 30, 2016 (Successor) and used $69,461 for the three months ended March 31, 2016 (Predecessor).  This compares with generation of $30,563 for the nine months ended September 30, 2015 (Predecessor).  The increase is due to the financing transaction of the building and notes payable in the acquisition of QCA.

Off-Balance Sheet Arrangements

The Company has not entered into any transactions with unconsolidated entities whereby the Company has financial guarantees, subordinated retained interests, derivative instruments, or other contingent arrangements that expose the Company to material continuing risks, contingent liabilities, or any other obligation under a variable interest in an unconsolidated entity that provides financing, liquidity, market risk, or credit risk support to the Company.

Critical Accounting Policies and Estimates

The preparation of financial statements and related disclosures in conformity with U.S. generally accepted accounting principles ("GAAP") and the Company's discussion and analysis of its financial condition and operating results require the Company's management to make judgments, assumptions, and estimates that affect the amounts reported in its condensed consolidated financial statements and accompanying notes.  Note 2, "Summary of Significant Accounting Policies" of this Form 10-Q describes the significant accounting policies and methods used in the preparation of the Company's condensed consolidated financial statements. Management bases its estimates on historical experience and on various other assumptions it believes to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities. Actual results may differ from these estimates and such differences may be material.

Management believes the Company's critical accounting policies and estimates are those related to revenue recognition, inventory valuation and lease accounting. Management considers these policies critical because they are both important to the portrayal of the Company's financial condition and operating results, and they require management to make judgments and estimates about inherently uncertain matters.

Revenue Recognition

The Company has a portfolio of consumer and professional software applications called 6thSenseAuto, which consists primarily of the Company's two products previously branded as LotWatch™ and ServiceWatch™.

LotWatch™ is a product for dealerships to give them vehicle inventory information. Our telematics devices use information gathered from the OBD (On Board Diagnostics) port, and by utilizing both GPS technology and cellular based service, the LotWatch™ module provides specific, real-time, accurate information about a dealership's fleet of new vehicles. This information can be easily accessed and viewed on Alpine 4's interface anywhere the dealership have internet access.

ServiceWatch™ is a product for the driving consumer that also uses information gathered from the OBD port.  By utilizing both GPS technology and cellular based service, the ServiceWatch™ module provides vehicle specific real-time, accurate information to a dealership's service department to increase sales all while improving their level of service.

When the Company enters into an agreement with a car dealership that wants to utilize its LotWatch™ service, a telematics device must be installed in each vehicle.  The Company will generally charge the car dealership a flat fee to install its telematics device in each vehicle.  The Company recognizes revenue when all the devices have been installed.  At the end of each month, the Company will charge the dealership a fee based on the average number of cars on the dealer's lot during the month and revenue is recognized at that time (end of the month).

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The Company will account for its revenue per the guidance in ASC 605-25-25 by allocating the total contract amount between the product and service elements.  When a vehicle is sold to the driving consumer who purchases the ServiceWatch™ service, the cost of the service is added to the price of the car and the amount collected by the dealership for this service is remitted to the Company.  At the time of the vehicle is purchased, the Company recognizes revenue for the retail value of the telematics device that has been installed in the vehicle and the remaining amount is recognized over the service period of generally 24 to 36 months.

The Company also derives revenue from the sale of circuit boards and wire harnesses and recognizes revenue either FOB Origin or FOB Destination dependent upon the contract with the customer.

We consider revenue recognizable when persuasive evidence of an arrangement exists, the price is fixed or determinable, goods or services have been shipped or delivered, and collectability is reasonably assured. These criteria are assumed to have been met if a customer orders an item, the goods or services have been shipped or delivered to the customer, and we have sufficient evidence of collectability, such a payment history with the customer.  Our records for all periods presented have been sufficient to satisfy all of the four requirements.

Inventory

Inventory is valued at the lower of the inventory's cost (weighted average basis) or the current market price of the inventory. Management compares the cost of inventory with its market value and an allowance is made to write down inventory to market value, if lower.  

Recent Developments

Acquisition of Quality Circuit Assembly

Effective April 1, 2016 the Company Purchased 100% of the stock of Quality Circuit Assembly, Inc., a California company ("QCA").

The purchase price paid by the Company for the QCA Shares consists of cash, and a convertible promissory note.   The "Cash Consideration" paid was the aggregate amount of $3,000,000, with $1,650,000 being paid to Mr. Moss, and $1,350,000 being paid to Mr. Hargreaves.  The "Promissory Note Consideration" consists of a secured promissory note (the "Quality Circuit Assembly Note") in the amount of $2,000,000, secured by a subordinated security interest in the assets of QCA.  Additionally, the Sellers have the opportunity to convert the Quality Circuit Assembly Note into shares of the Company's Class A common stock at a conversion price of $10 per share after 12 months.  The Quality Circuit Assembly Note will bear interest at 5%, and will be payable in full on the 39-month anniversary of the closing date of the transaction (namely, July 1, 2019).

Appointment of Chief Financial Officer

On October 25, 2016, the Board of Directors of Alpine 4 Technologies Ltd., a Delaware corporation (the "Company"), approved the appointment of David Schmitt as the Company's new Chief Financial Officer.

Mr. Schmitt, age 38, had been serving as the Company's VP of Finance and the Controller, prior to his appointment as the Company's new CFO.

- Over the past five years Mr. Schmitt has held roles as the VP of Finance for Alpine 4 Technologies, Ltd., Director of Accounting, Associate Director of Accounting, and Accounting Manager;

- Mr. Schmitt has an active CPA license from the Arizona State Board of Accountancy since May of 2013;

- He has his undergraduate degree in Finance from the University of Richmond and his Masters of Accountancy from University of Phoenix;

- Compensation is $150,000 annually, and Mr. Schmitt is eligible for the executive bonus pool.

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There are no family relationships between Mr. Schmitt and any of the other executive officers or directors of the Company, or anyone nominated to become an executive officer or director of the Company.

As of the date of this Report, there were no related party transactions between Mr. Schmitt and the Company or any of its executive officers or directors.

Adoption of 2016 Stock Option and Stock Award Plan

On November 10, 2016, the Company's Board of Directors adopted the Company's 2016 Stock Option and Stock Award Plan (the "Plan").  Pursuant to the Plan, the Company may issue stock options, including incentive stock options and non-qualifying stock options, and stock grants to employees and consultants of the Company, as set forth in the Plan, a copy of which is included as an exhibit to this Report.  The Company reserved 2,000,000 shares of the Company's Class A common stock for issuance under the Plan.

The Company intends to seek shareholder approval of the Plan at the Company's next annual meeting. Additional information about the Plan will be provided in connection with seeking that approval.

Item 3. Quantitative and Qualitative Disclosures about Market Risk.

None.

Item 4. Controls and Procedures.

Evaluation of Disclosure Controls and Procedures

As required by Rule 13a-15 under the Securities Exchange Act of 1934, we have carried out an evaluation of the effectiveness of our disclosure controls and procedures as of the end of the period covered by this quarterly report, September 30, 2016. This evaluation was carried out under the supervision and with the participation of our management, including our Chief Executive Officer and Chief Financial Officer.

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Disclosure controls and procedures are controls and other procedures that are designed to ensure that information required to be disclosed in our reports filed or submitted under the Securities Exchange Act of 1934 is recorded, processed, summarized and reported, within the time periods specified in the Securities and Exchange Commission's rules and forms. Disclosure controls and procedures include controls and procedures designed to ensure that information required to be disclosed in our company's reports filed under the Securities Exchange Act of 1934 is accumulated and communicated to management, including our Chief Executive Officer and Chief Financial Officer, to allow timely decisions regarding required disclosure.

Based upon that evaluation, including our Chief Executive Officer and Chief Financial Officer, we have concluded that our disclosure controls and procedures were ineffective as of the end of the period covered by this report due to the following material weaknesses in our internal control over financial reporting, which are indicative of many small companies with small staff: (i) inadequate segregation of duties and effective risk assessment; (ii) inadequate control activities and monitoring processes; and (iii) failure in the process for identification and disclosure of related party transactions; and (iv) insufficient written policies and procedures for accounting and financial reporting with respect to the requirements and application of both U.S. GAAP and SEC guidelines.

We plan to take steps to enhance and improve the design of our internal control over financial reporting. During the period covered by this quarterly report on Form 10-Q, we have not been able to remediate the material weaknesses identified above. To remediate such weaknesses, we hope to implement the following changes during our fiscal year ending December 31, 2016: (i) appoint additional qualified personnel to address inadequate segregation of duties and ineffective risk management; and (ii) adopt sufficient written policies and procedures for accounting and financial reporting. The remediation efforts set out in (i) and (ii) are largely dependent upon our securing additional financing to cover the costs of implementing the changes required. If we are unsuccessful in securing such funds, remediation efforts may be adversely affected in a material manner.

Changes in Internal Control over Financial Reporting

There were no changes in our internal control over financial reporting during the quarter ended September 30, 2016, that have materially affected or are reasonably likely to materially affect, our internal control over financial reporting.

Subsequent to the period covered by this Report, the Board of Directors of the Company appointed David Schmitt as the Company's new Chief Financial Officer. The Company's management anticipates that the appointment of Mr. Schmitt will help remediate the material weaknesses described above. Additional information will be provided in subsequent reports.

PART II - OTHER INFORMATION

Item 1.                      Legal Proceedings.

There are not presently any material pending legal proceedings to which the Company is a party or as to which any of its property is subject, and no such proceedings are known to the Company to be threatened or contemplated against it.

Item 1A. Risk Factors

Not required for Smaller Reporting Companies.  Investors may review the Company's Annual Report on Form 10-K for the year ended December 31, 2015, as amended, filed with the U.S. Securities and Exchange Commission, which includes risk factors relating to the Company, its business and operations, and ownership of the Company's securities.

Item 2.                      Unregistered Sales of Equity Securities and Use of Proceeds.

During the quarter ended June 30, 2016, the Company sold an aggregate of 670 shares of its restricted Class A common stock in private offerings.  The Company raised an aggregate of approximately $6,000.  The Company issued 159,830 shares of its restricted class A common stock in connection with the conversion of convertible notes payable.  Additionally, the Company issued 200,548 (157,000 to employees) shares of its Class A common stock for services.

The shares of common stock were issued without registration under the 1933 Act in reliance on Section 4(a)(2) of the 1933 Act and the rules and regulations promulgated thereunder.

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Item 3.                      Defaults Upon Senior Securities

None.

Item 4.                      Mining Safety Disclosures

Not applicable.

Item 5.                      Other Information.

None. 

Item 6.                      Exhibits.

3.1	Certificate of Incorporation (previously filed with the Commission as an exhibit to the Company's Form 10 and incorporated herein by reference)
3.2	Bylaws (previously filed with the Commission as an exhibit to the Company's Form 10 and incorporated herein by reference)
3.3	Certificate of Amendment to Certificate of Incorporation (previously filed with the Commission as an exhibit to the Company's Form 8-K on July 18, 2014, and incorporated herein by reference)
3.4	Certificate of Amendment to Certificate of Incorporation (previously filed with the Commission as an exhibit to the Company's Form 8-K on July 18, 2014, and incorporated herein by reference)
10.5	QCA Stock Purchase Agreement, dated as of March 15, 2016 (incorporated by reference to the Company's Current Report on Form 8-K filed with the Commission on March 15, 2016)
10.6	Reverse stock slip of 1 to 10 as of July 29, 2016 (incorporated by reference to the Company's Current Report on Form 8-K filed with the Commission on August 3, 2016)
10.7	2016 Stock Option and Stock Award Plan
31.1	Certification of Chief Executive Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
31.2	Certification of Chief Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
32.1	Certification of the Chief Executive Officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
32.2	Certification of the Chief Financial Officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
101.INS*	XBRL Instance Document
101.SCH*	XBRL Taxonomy Extension Schema Document
101.CAL*	XBRL Taxonomy Extension Calculation Linkbase Document
101.LAB*	XBRL Taxonomy Extension Label Linkbase Document
101.PRE*	XBRL Taxonomy Extension Presentation Linkbase Document
101.DEF*	XBRL Taxonomy Extension Definition Linkbase Definition

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SIGNATURES

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

	Alpine 4 Technologies Ltd.
Dated: November 14, 2016
	By: /s/ Kent B. Wilson
	Kent B. Wilson
	Chief Executive Officer, President, and Secretary (Principal Executive Officer)

Dated: November 14, 2016
	By: /s/ David G. Schmitt
	David G. Schmitt
	Chief Financial Officer, (Principal Financial Officer)

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EX-10.7

Exhibit 10.7

ALPINE 4 TECHNOLOGIES LTD.

2016 STOCK OPTION AND STOCK AWARD PLAN

1.Establishment, Purpose and Term of Plan.

1.1Establishment.  This Alpine 4 Technologies Ltd. 2016 Stock Option and Stock Award Plan (the "Plan") shall become effective upon the date that it is approved by the stockholders of Alpine 4 Technologies Ltd. (the "Company").

1.2Purpose.  The purpose of the Plan is to advance the interests of the Company and its shareholders by providing an incentive to attract, retain and reward persons performing services for the Company and by motivating such persons to contribute to the growth and profitability of the Company.

1.3Term of Plan.  The Plan shall continue in effect until the earlier of its termination by the Board or the date on which all of the shares of Stock available for issuance under the Plan have been issued and all restrictions on such shares under the terms of the Plan and the agreements evidencing Awards granted under the Plan have lapsed.  However, all Awards shall be granted, if at all, within ten (10) years from the earlier of the date the Plan is adopted by the Board or the date the Plan is duly approved by the shareholders of the Company.

2.Definitions and Construction.

2.1Definitions.  Whenever used herein, the following terms shall have their respective meanings set forth below:

(a)"Administrator" means the Board or, with respect to any matter as to which responsibility has been delegated to the Committee, the term Administrator shall mean the Committee.

(b)"Award" means any award or benefit granted to any participant under the Plan, including, without limitation, the grant of an Option, Restricted Stock Grant or Stock Appreciation Right.

(c) "Board" means the Board of Directors of the Company.  If one or more Committees have been appointed by the Board to administer the Plan, "Board" also means such Committee(s).

(d)"Code" means the Internal Revenue Code of 1986, as amended, and any applicable regulations promulgated thereunder.

(e) "Committee" means the any committee of the Board duly appointed to administer the Plan and having such powers as shall be specified by the Board.  The Committee must be comprised of at least two (2) members of the Board.  Unless the powers of the Committee have been specifically limited, the Committee shall have all of the powers of the Board granted herein, including, without limitation, the power to amend or terminate the Plan at any time, subject to the terms of the Plan and any applicable limitations imposed by law.  Once appointed, the Committee shall continue to serve in its designated capacity until otherwise directed by the Board. From time to time the Board may increase the size of the Committee and appoint additional members thereof, remove members (with or without cause) and appoint new members in substitution therefor, fill vacancies, however caused, and remove all members of the Committee and thereafter directly administer the Plan.

(f)"Company" means Alpine 4 Technologies Ltd., a Delaware corporation, or any successor corporation thereto.

(g) "Consultant" means any person, including an advisor, engaged by Company to render services other than as an Employee or a Director.

(h)"Director" means a member of the Board.

(i)"Disability" means, with respect to a Grantee, that the Grantee has any medically determinable physical or mental impairment which can be expected to result in death or which has lasted or can be expected to last for a continuous period of not less than twelve (12) months, and which renders the Grantee unable to engage in any substantial gainful activity.  A Grantee shall not be considered to have a Disability unless Grantee furnishes proof of the existence thereof in such form and manner, and at such time, as the Administrator may require, and the Administrator determines in its discretion that the Grantee has such a medically determinable physical or mental impairment.

(j)"Employee" means any person treated as an employee (including an Officer or a Director who is also treated as an employee) in the records of Company and, with respect to any Incentive Stock Option granted to such person, who is an employee for purposes of Section 422 of the Code; provided, however, that neither service as a Director nor payment of a director's fee shall be sufficient to constitute employment for purposes of the Plan.

(k)"Exchange Act" means the Securities Exchange Act of 1934, as amended.

(l)"Fair Market Value" means, as of any date, the value of a share of Stock or other property as determined by the Administrator, in its discretion, or by the Company, in its discretion, if such determination is expressly allocated to the Company herein, subject to the following:

(i)If, on such date, the Stock is listed on any established stock exchange or a national market system, including without limitation the National  Market System of the National Association of Securities Dealers, Inc. Automated Quotation ("NASDAQ") System, the Fair Market Value of a share of Stock shall be the closing price of a share of Stock (or the mean of the closing bid and asked prices of a share of Stock if the Stock is so quoted instead) as reported in The Wall Street Journal or such other source as the Administrator deems reliable.  If the relevant date does not fall on a day on which the Stock has traded on such securities exchange or market system, the date on which the Fair Market Value shall be established shall be the last day on which the Stock was so traded prior to the relevant date, or such other appropriate day as shall be determined by the Administrator, in its discretion.  If the Stock is listed on a market system but is not actively traded in such amounts and as frequently as the Administrator deems necessary, in its sole discretion, to determine the Fair Market Value of a share of Stock, then the Administrator shall determine, in its sole discretion, the value of a share of Stock.

(ii)If, on such date, there is no public market for the Stock, the Fair Market Value of a share of Stock shall be as determined by the Administrator in good faith without regard to any restriction other than a restriction which, by its terms, will never lapse.

(m)"Grant Agreement" means a written agreement, including any related form of stock option grant agreement, restricted stock grant agreement or stock appreciation right grant agreement, between the Company and a Grantee setting forth the terms, conditions and restrictions of the Award granted to the Grantee and any shares acquired upon the exercise thereof.

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(n)"Grantee" means a person who has been granted one or more Awards.

(o)"Incentive Stock Option" means an Option intended to be (as set forth in the Grant Agreement) and which qualifies as an incentive stock option within the meaning of Section 422(b) of the Code.  An Option shall only be treated as an Incentive Stock Option pursuant to the Plan if it is originally designated as an Incentive Stock Option in the Grant Agreement.  An Option originally designated in a Grant Agreement as an Incentive Stock Option may nonetheless be treated as a Nonstatutory Stock Option if the Option at any time after grant fails to meet to requirements for incentive stock option treatment under Section 422 of the Code.

(p)"Nonstatutory Stock Option" means an Option not intended to be (as set forth in the Grant Agreement) or which does not qualify as an Incentive Stock Option.  An Option which is designated as a Nonstatutory Stock Option in the Grant Agreement pursuant to which the Option was granted shall in all events be treated as a Nonstatutory Stock Option.  Furthermore, an Option originally designated as an Incentive Stock Option may subsequently become a Nonstatutory Stock Option upon the Option subsequently failing the meet the requirements for incentive stock option under Section 422 of the Code.

(q)"Officer" means a person who is an officer of the Company within the meaning of Section 16 of the Exchange Act and the rules and regulations promulgated thereunder.

(r)"Option" means a right to purchase a specified number of shares of Stock (subject to adjustment as provided in Section 4.2) pursuant to the terms and conditions of the Plan.  An Option may be either an Incentive Stock Option or a Nonstatutory Stock Option.

(s)"Plan" means this Influence International, Inc. Stock Option and Stock Award Plan, as amended from time to time in accordance with the terms hereof.

(t)"Restricted Stock" means shares of Stock granted under the Plan that are subject to the restrictions set forth in Section 7 hereof.

(u)"Restricted Stock Grant" means an Award representing the right to receive a specified number of shares of Restricted Stock (subject to adjustment as provided in Section 4.2) pursuant to the terms and conditions of the Plan. 

(v)"Securities Act" means the Securities Act of 1933, as amended.

(w)"Service" means a Grantee's employment or service with Company, whether in the capacity of an Employee, a Director or a Consultant.  The Grantee's Service shall not be deemed to have terminated merely because of a change in the capacity in which the Grantee renders Service to Company, provided that there is no interruption or termination of the Grantee's Service.  Furthermore, a Grantee's Service with Company shall not be deemed to have terminated if the Grantee takes any military leave, sick leave, or other bona fide leave of absence approved by Company; provided, however, that if any such leave exceeds ninety (90) days, on the ninety-first (91st) day of such leave the Grantee's Service shall be deemed to have terminated unless the Grantee's right to return to Service with Company is guaranteed by statute or contract.  Notwithstanding the foregoing, unless otherwise designated by Company or required by law, a leave of absence shall not be treated as Service for purposes of determining vesting under the Grantee's Grant Agreement.  The Grantee's Service shall be deemed to have terminated upon an actual termination of Service.  Subject to the foregoing, the Company, in its discretion, shall determine whether the Grantee's Service has terminated and the effective date of such termination.

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(x)"Stock" means the Class A common stock of the Company, as adjusted from time to time in accordance with Section 4.2.

(y)"Stock Appreciation Right" means the right to receive an amount determined in accordance with Section 8 hereof.

(z)"Stock Appreciation Right Grant" means an Award representing the right to receive Stock Appreciation Rights with respect to a specified number of shares of Stock (subject to adjustment as provided in Section 4.2) pursuant to the terms and conditions of the Plan.

(aa)"Ten Percent Owner" means a Grantee who, at the time an Award is granted to the Grantee, owns, or is deemed within the meaning of Section 422(b)(6) of the Code to own, stock possessing more than ten percent (10%) of the total combined voting power of all classes of stock of Company within the meaning of Section 422(b)(6) of the Code.

2.2Construction.  To the extent any provision herein conflicts with the conditions of any relevant tax law or regulation which are relied upon for tax relief in respect of a particular Award or Stock granted to a Grantee pursuant to this Plan, the provisions of said law or regulation shall prevail over those of the Plan, and the Administrator is empowered to interpret and enforce the said prevailing provisions.  Captions and titles contained herein are for convenience only and shall not affect the meaning or interpretation of any provision of the Plan.  Except when otherwise indicated by the context, the singular shall include the plural and the plural shall include the singular.  Use of the term "or" is not intended to be exclusive, unless the context clearly requires otherwise.

3.Administration.

3.1Administration by the Administrator.  The Plan shall be administered by the Board, which may delegate such responsibilities in whole or in part to a Committee.  Members of the Committee may be appointed from time to time by, and shall serve at the pleasure of, the Board.  The Board may limit the composition of the Committee to those persons necessary to comply with the requirements of Section 162(m) of the Code and Section 16 of the Exchange Act.  All questions of interpretation of the Plan or of any Award shall be determined by the Administrator (the Board, or to the Committee to which the Board has delegated such responsibility), and such determinations shall be final and binding upon all persons having an interest in the Plan or such Option.

3.2Powers of the Administrator.  In addition to any other powers set forth in the Plan and subject to the provisions of the Plan, the Administrator shall have the full and final power and authority, in its discretion:

(a)to determine the persons to whom, and the time or times at which, Awards shall be granted and the number of shares of Stock to which each Award relates;

(b)to designate Options as Incentive Stock Options or Nonstatutory Stock Options;

(c)to determine the Fair Market Value of shares of Stock or other property;

(d)to determine the terms, conditions and restrictions, not inconsistent with the terms of the Plan, applicable to each Award (which need not be identical) and any shares acquired upon the exercise thereof, including, without limitation, (i) the exercise price of an Option, (ii) the Grant Value of a Stock Appreciation Right, (iii) the method of payment for shares purchased upon the exercise of an Option, (iv) the method of payment for the amount due upon exercise of a Stock Appreciation Right, (v) the method for satisfaction of any tax withholding obligation arising in connection with the grant or exercise of an Award, including by the withholding or delivery of shares of stock, (vi) the timing, terms and conditions of the exercisability of the Award or the vesting of any shares acquired upon the exercise thereof, (vii) the time of the expiration of the Award, (viii) the effect of the Grantee's termination of Service with the Company on any of the foregoing, and (ix) all other terms, conditions and restrictions applicable to the Award or such shares not inconsistent with the terms of the Plan;

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(e)to approve one or more forms of Grant Agreement;

(f)to reduce the exercise price of any Option to the then current Fair Market Value if the Fair Market Value of the Stock covered by such Option shall have declined since the date the Option was granted;

(g)to amend, modify, extend, cancel, renew, reprice or otherwise adjust the exercise price of, or grant a new Award in substitution for, any Award or to waive any restrictions or conditions applicable to any Award or any shares acquired upon the exercise thereof;

(h)to accelerate, continue, extend or defer the exercisability of any Award or the vesting of any shares acquired upon the exercise thereof, including with respect to the period following a Grantee's termination of Service with the Company;

(i)to prescribe, amend or rescind rules, guidelines and policies relating to the Plan, or to adopt supplements to, or alternative versions of, the Plan, including, without limitation, as the Administrator deems necessary or desirable to comply with the laws of, or to accommodate the tax policy or custom of, foreign jurisdictions whose citizens may be granted Awards; and

(j)to correct any defect, supply any omission or reconcile any inconsistency in the Plan or any Grant Agreement and to make all other determinations and take such other actions with respect to the Plan or any Award as the Board may deem advisable to the extent consistent with the Plan and applicable law.

3.3Effect of Administrator's Decision.  Whether explicitly provided elsewhere in this Plan with respect to any matter, all decisions, determinations and interpretations of the Administrator provided in this Plan shall be made in the Administrator's sole and absolute discretion, and shall be final and binding on all Grantees and any other holders of any Awards.  No member of the Committee or the Board shall be liable for any action taken or determination made in good faith with respect to the Plan or any Award granted hereunder. All such interpretations, rules, determinations, terms and conditions shall be made and prescribed in the context of preserving the tax status under Section 422 of the Code of those Options which are designated as Incentive Stock Options.

4.Shares Subject to Plan.

4.1Maximum Number of Shares Issuable.  Subject to adjustment as provided in Section 4.2, the maximum aggregate number of (i) shares of Stock that may be issued under the Plan and (ii) shares of Stock with respect to which Options or Stock Appreciation Rights may be granted, shall be Two Million (2,000,000) and shall consist of authorized but unissued or reacquired shares of Stock or any combination thereof.  Such number of shares of Stock may be issued under this Plan pursuant to Incentive Stock Options, Nonstatutory Stock Options, Restricted Stock Grants, Stock Appreciation Right Grants, or any combination thereof, so long as the aggregate number of shares so issued does not exceed such number of shares, as adjusted.  If an outstanding Award for any reason expires or is terminated or canceled or if shares of Stock are acquired upon the exercise of an Award subject to a Company repurchase option and are repurchased by the Company at the Grantee's exercise price, the shares of Stock allocable to the unexercised portion of such Award or such repurchased shares of Stock shall again be available for issuance under the Plan.  

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4.2Adjustments for Changes in Capital Structure.  In the event of any stock dividend, stock split, reverse stock split, recapitalization, combination, reclassification or similar change in the capital structure of the Company, appropriate adjustments shall be made in the number and class of shares subject to the Plan and to any outstanding Awards and in the exercise price per share of any outstanding Awards.  If a majority of the shares which are of the same class as the shares that are subject to outstanding Awards are exchanged for, converted into, or otherwise become (whether or not pursuant to an Ownership Change Event, as defined in Section 10.1) shares of another corporation (the "New Shares"), the Administrator may unilaterally amend the outstanding Awards to provide that such Awards are exercisable for New Shares.  In the event of any such amendment, the number of shares subject to, and the exercise price per share of, the outstanding Awards shall be adjusted in a fair and equitable manner as determined by the Administrator, in its discretion.  Notwithstanding the foregoing, any fractional share resulting from an adjustment pursuant to this Section 4.2 shall be rounded down to the nearest whole number, and in no event may the exercise price of any Award be decreased to an amount less than the par value, if any, of the stock subject to the Award.  The adjustments determined by the Administrator pursuant to this Section 4.2 shall be final, binding and conclusive.

5.Eligibility and Award Limitations.

5.1Persons Eligible for Awards.  Awards may be granted only to Employees, Consultants, and Directors.  For purposes of the foregoing sentence, "Employees," "Consultants" and "Directors" shall include prospective Employees, prospective Consultants and prospective Directors to whom Awards are granted in connection with written offers of an employment or other service relationships with the Company.  Eligible persons may be granted more than one (1) Award.

5.2Award Grant Restrictions.  Any person who is not an Employee on the effective date of the grant of an Award to such person may not be granted an Incentive Stock Option.  An Incentive Stock Option granted to a prospective Employee upon the condition that such person become an Employee shall be deemed granted effective on the date such person commences Service with Company, with an exercise price determined as of such date in accordance with Section 6.1.

5.3Fair Market Value Limitation.  To the extent that options designated as Incentive Stock Options become exercisable by a Grantee for the first time during any calendar year for stock having a Fair Market Value greater than One Hundred Thousand Dollars ($100,000), the portions of such options which exceed such amount shall be treated as Nonstatutory Stock Options.  For purposes of this Section 5.3, options designated as Incentive Stock Options shall be taken into account in the order in which they were granted, and the Fair Market Value of stock shall be determined as of the time the option with respect to such stock is granted.  If the Code is amended to provide for a different limitation from that set forth in this Section 5.3, such different limitation shall be deemed incorporated herein effective as of the date and with respect to such Options as required or permitted by such amendment to the Code.  If an Option is treated as an Incentive Stock Option in part and as a Nonstatutory Stock Option in part by reason of the limitation set forth in this Section 5.3, the Grantee may designate which portion of such Option the Grantee is exercising.  In the absence of such designation, the Grantee shall be deemed to have exercised the Incentive Stock Option portion of the Option first.  Separate certificates representing each such portion shall be issued upon the exercise of the Option.

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5.4Non-Uniform Determinations. The Administrator's determinations under the Plan (including without limitation determinations of the persons to receive Awards, the form, amount and timing of such Awards, the terms and provisions of such Awards and the agreements evidencing same) need not be uniform and may be made by it selectively among persons who receive, or are eligible to receive, Awards under the Plan, whether or not such persons are similarly situated.

6.Terms and Conditions of Options.

Options shall be evidenced by Grant Agreements specifying the number of shares of Stock covered thereby, in such form as the Administrator shall from time to time establish.  No Option or purported Option shall be a valid and binding obligation of the Company unless evidenced by a fully executed Grant Agreement.  Grant Agreements may incorporate all or any of the terms of the Plan by reference and shall comply with and be subject to the following terms and conditions:

6.1Procedure for Exercise; Rights as a Shareholder.  Any Option granted hereunder shall be exercisable at such times and under such conditions as determined by the Administrator, including performance criteria with respect to the Company and/or the Grantee, and as shall be permissible under the terms of the Plan. An Option may not be exercised for a fraction of a Share. An Option shall be deemed to be exercised when written notice of such exercise has been given to the Company in accordance with the terms of the Grant Agreement by the person entitled to exercise the Option and full payment for the Stock with respect to which the Option is exercised has been received by the Company. Full payment may, as authorized by the Administrator, consist of any consideration and method of payment allowable under Section 6.4 of the Plan. Until the issuance (as evidenced by the appropriate entry on the books of the Company or of a duly authorized transfer agent of the Company) of the stock certificate evidencing such Stock, no right to vote or receive dividends or any other rights as a shareholder shall exist with respect to the Stock, notwithstanding the exercise of the Option. The Company shall issue (or cause to be issued) such stock certificate promptly upon exercise of the Option. No adjustment will be made for a dividend or other right for which the record date is prior to the date the stock certificate is issued, except as provided in Section 10 hereof. Exercise of an Option in any manner shall result in a decrease in the number shares of Stock which thereafter may be available, both for purposes of the Plan and for sale under the Option, by the number of shares of Stock as to which the Option is exercised.

6.2Exercise Price.  The exercise price for each Option shall be established in the discretion of the Administrator; provided, however, that (a) the exercise price per share for an Incentive Stock Option granted to a Ten Percent Owner shall not be less than one hundred ten percent (110%) of the Fair Market Value of a share of Stock on the effective date of grant of the Option and (b) the exercise price per share for either an Incentive Stock Option granted to a person other than a Ten Percent Owner or a Nonstatutory Stock Option granted to any person shall not be less than the Fair Market Value of a share of Stock on the effective date of grant of the Option. Notwithstanding the foregoing, an Option (whether an Incentive Stock Option or a Nonstatutory Stock Option) may be granted with an exercise price lower than the minimum exercise price set forth above if such Option is granted pursuant to an assumption or substitution for another option in a manner qualifying under the provisions of Section 424(a) of the Code.

6.3Exercise Period.  Options shall be exercisable at such time or times, or upon such event or events, and subject to such terms, conditions, performance criteria, and restrictions as shall be determined by the Administrator and set forth in the Grant Agreement evidencing such Option; provided, however, that (a) no Option shall be exercisable after the expiration of ten (10) years after the effective date of grant of such Option, (b) no Incentive Stock Option granted to a Ten Percent Owner shall be exercisable after the expiration of five (5) years after the effective date of grant of such Option, (c) no Option granted to a prospective Employee, prospective Consultant or prospective Director may become exercisable prior to the date on which such person commences Service with the Company, and (d) unless otherwise permitted by applicable law, and with the exception of an Option granted to an officer, Director or Consultant, no Option shall become exercisable at a rate less than twenty percent (20%) per year over a period of five (5) years from the effective date of grant of such Option, subject to the Grantee's continued Service.  Subject to the foregoing, unless otherwise specified by the Administrator in the grant of an Option, any Option granted hereunder shall have a term of ten (10) years from the effective date of grant of the Option.

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6.4Payment of Exercise Price.

(a)Forms of Consideration Authorized.  Except as otherwise provided below, payment of the exercise price for the number of shares of Stock being purchased pursuant to any Option shall be made (i) in cash, by check or cash equivalent, (ii) by tender to the Company, or attestation to the ownership, of shares of Stock owned by the Grantee having a Fair Market Value (as determined by the Administrator without regard to any restrictions on transferability applicable to such stock by reason of federal or state securities laws or agreements with an underwriter for the Company) not less than the exercise price, (iii) by the assignment of the proceeds of a sale or loan with respect to some or all of the shares being acquired upon the exercise of the Option (including, without limitation, through an exercise complying with the provisions of Regulation T as promulgated from time to time by the Board of Governors of the Federal Reserve System) (a "Cashless Exercise"), (iv) by such other consideration as may be approved by the Administrator from time to time to the extent permitted by applicable law, or (v) by any combination of the foregoing.  The Administrator may at any time or from time to time, by adoption of or by amendment to the standard forms of Grant Agreement described in Section 9, or by other means, grant Options which do not permit all of the foregoing forms of consideration to be used in payment of the exercise price or which otherwise restrict one or more forms of consideration.

(b)Limitations on Forms of Consideration.

(i)Tender of Stock.  Notwithstanding the foregoing, an Option may not be exercised by tender to the Company, or attestation to the ownership, of shares of Stock to the extent such tender or attestation would constitute a violation of the provisions of any law, regulation or agreement restricting the redemption of the Company's stock.  Unless otherwise provided by the Administrator, an Option may not be exercised by tender to the Company, or attestation to the ownership, of shares of Stock unless such shares either have been owned by the Grantee for more than six (6) months or were not acquired, directly or indirectly, from the Company.

(ii)Cashless Exercise.  The Company reserves, at any and all times, the right, in the Company's sole and absolute discretion, to establish, decline to approve or terminate any program or procedures for the exercise of Options by means of a Cashless Exercise.

6.5Tax Withholding.  The Company shall have the right, but not the obligation, to deduct from the shares of Stock issuable upon the exercise of an Option, or to accept from the Grantee the tender of, a number of whole shares of Stock having a Fair Market Value, as determined by the Administrator, equal to all or any part of the federal, state, local and foreign taxes, if any, required by law to be withheld by the Company with respect to such Option or the shares acquired upon the exercise thereof.  Alternatively or in addition, in its discretion, the Administrator shall have the right to require the Grantee, through payroll withholding, cash payment or otherwise, including by means of a Cashless Exercise, to make adequate provision for any such tax withholding obligations of the Company arising in connection with the Option or the shares acquired upon the exercise thereof.  The Company shall have no obligation to deliver shares of Stock or to release shares of Stock from an escrow established pursuant to the Grant Agreement until the Company's tax withholding obligations have been satisfied by the Grantee.

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6.6Repurchase Rights.  Stock acquired by the exercise of an Option granted under the Plan may be subject to a right of first refusal, one or more repurchase options, or other conditions and restrictions as set forth in any shareholders, buy-sell or similar agreement, and as determined by the Board in its discretion at the time the Option is granted.  In exercising its right of first refusal or other repurchase right, the repurchase price may be paid by the Company, or its assignee, by cash, check, or cancellation of indebtedness.  The Company shall have the right to assign at any time any repurchase right it may have, whether or not such right is then exercisable, to one or more persons as may be selected by the Company.  Upon request by the Company, each Grantee shall execute any agreement evidencing such transfer restrictions prior to the receipt of shares of Stock hereunder, and shall promptly present to the Company any and all certificates representing shares of Stock acquired hereunder for the placement on such certificates of appropriate legends evidencing any such transfer restrictions.  

6.7Effect of Termination of Service.

(a)Option Exercisability.  Subject to earlier termination of the Option as otherwise provided herein, an Option shall be exercisable after a Grantee's termination of Service as follows:

(i)Disability.  If the Grantee's Service with the Company is terminated because of the Disability of the Grantee, the Option, to the extent unexercised and exercisable on the date on which the Grantee's Service terminated, may be exercised by the Grantee (or the Grantee's guardian or legal representative) at any time prior to the expiration of six (6) months (or such longer period of time as determined by the Administrator, in its discretion) after the date on which the Grantee's Service terminated, but in any event no later than the date of expiration of the Option's term as set forth in the Grant Agreement evidencing such Option (the "Option Expiration Date").

(ii)Death.  If the Grantee's Service with the Company is terminated because of the death of the Grantee, the Option, to the extent unexercised and exercisable on the date on which the Grantee's Service terminated, may be exercised by the Grantee's legal representative or other person who acquired the right to exercise the Option by reason of the Grantee's death at any time prior to the expiration of six (6) months (or such longer period of time as determined by the Administrator, in its discretion) after the date on which the Grantee's Service terminated, but in any event no later than the Option Expiration Date.  The Grantee's Service shall be deemed to have terminated on account of death if the Grantee dies within thirty (30) days (or such longer period of time as determined by the Administrator, in its discretion) after the Grantee's termination of Service.

(iii)Termination After Change in Control.  The Administrator may, in its discretion, provide in any Grant Agreement that if the Grantee's Service with the Company ceases as a result of "Termination After Change in Control" (as defined in such Grant Agreement), then (1) the Option, to the extent unexercised and exercisable on the date on which the Grantee's Service terminated, may be exercised by the Grantee (or the Grantee's guardian or legal representative) at any time prior to the expiration of six (6) months (or such longer period of time as determined by the Administrator, in its discretion) after the date on which the Grantee's Service terminated, but in any event no later than the Option Expiration Date, and (2) the exercisability and vesting of the Option and any shares acquired upon the exercise thereof shall be accelerated effective as of the date on which the Grantee's Service terminated to such extent, if any, as shall have been determined by the Administrator, in its discretion, and set forth in the Grant Agreement.

(iv)Other Termination of Service.  If the Grantee's Service with the Company terminates for any reason, except Disability or death, the Option, to the extent unexercised and exercisable by the Grantee on the date on which the Grantee's Service terminated, may be exercised by the Grantee within ninety (90) days (or such longer period of time as determined by the Administrator, in its discretion) after the date on which the Grantee's Service terminated, but in any event no later than the Option Expiration Date.

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 (b)Extension if Exercise Prevented by Law.  Notwithstanding the foregoing, if the exercise of an Option within the applicable time periods set forth in Section 6.7(a) is prevented by the provisions of Section 13 below, the Option shall remain exercisable until thirty (30) days (or such longer period of time as determined by the Administrator, in its discretion) after the date the Grantee is notified by the Company that the Option is exercisable, but in any event no later than the Option Expiration Date.

(c)Extension if Grantee Subject to Section 16(b).  Notwithstanding the foregoing, if a sale within the applicable time periods set forth in Section 6.7(a) of shares acquired upon the exercise of the Option would subject the Grantee to suit under Section 16(b) of the Exchange Act, the Option shall remain exercisable until the earliest to occur of (i) the tenth (10th) day following the date on which a sale of such shares by the Grantee would no longer be subject to such suit, (ii) the one hundred and ninetieth (190th) day after the Grantee's termination of Service, or (iii) the Option Expiration Date.

6.8Buyout Provisions.  The Administrator may at any time offer to buy out, for a payment in cash or shares of Stock, an Option previously granted, based on such terms and conditions as the Administrator shall establish and communicate to the Grantee at the time that such offer is made.

7.Terms and Conditions of Restricted Stock Grants

Restricted Stock Grants shall be evidenced by Grant Agreements specifying the number of shares of Restricted Stock covered thereby, in such form as the Administrator shall from time to time establish.  No Restricted Stock Grant or purported Restricted Stock Grant shall be a valid and binding obligation of the Company unless evidenced by a fully executed Grant Agreement.  Grant Agreements may incorporate all or any of the terms of the Plan by reference and shall comply with and be subject to the following terms and conditions:

7.1Restrictions. Shares of Restricted Stock may not be sold, assigned, transferred, pledged, hypothecated or otherwise disposed of, except by will or the laws of descent and distribution, for such period as the Administrator shall determine from the date on which the Award is granted (the "Restricted Period"). The Administrator may also impose such additional or alternative restrictions and conditions on the shares of Restricted Stock as it deems appropriate, including but not limited to the satisfaction of performance including performance criteria with respect to the Company, the Company and/or the Grantee, and as shall be permissible under the terms of the Plan. Certificates for shares of Restricted Stock shall bear an appropriate legend referring to such restrictions, and any attempt to dispose of any such shares in contravention of such restrictions shall be null and void ab initio and without effect. During the Restricted Period, such certificates shall be held with an agent designated by the Administrator under the terms and conditions of escrow and security agreements approved by the Administrator. In determining the Restricted Period of an Award the Administrator may provide that the foregoing restrictions shall lapse with respect to specified percentages of the awarded shares on successive anniversaries of the date of such Award.

7.2Adjustment of Performance Goals.  The Administrator may adjust performance goals for any shares of Restricted Stock to take into account changes in law and accounting and tax rules and to make such adjustments as the Administrator deems necessary or appropriate to reflect the inclusion or the exclusion of the impact of extraordinary or unusual items, events or circumstances. The Administrator also may adjust the performance goals by reducing the amount to be received by any Grantee pursuant to an Award if and to the extent that the Administrator deems it appropriate.

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7.3Repurchase Rights.  Restricted Stock granted under the Plan may be subject to a right of first refusal, one or more repurchase options, or other conditions and restrictions as set forth in a shareholders, buy-sell or other similar agreement and as determined by the Board in its discretion at the time the Restricted Stock is granted.  In exercising its right of first refusal or other repurchase right, the repurchase price may be paid by the Company, or its assignee, by cash, check, or cancellation of indebtedness.  The Company shall have the right to assign at any time any repurchase right it may have, whether or not such right is then exercisable, to one or more persons as may be selected by the Company.  Upon request by the Company, each Grantee shall execute any agreement evidencing such transfer restrictions prior to the receipt of shares of Restricted Stock hereunder, and shall promptly present to the Company any and all certificates representing shares of Restricted Stock acquired hereunder for the placement on such certificates of appropriate legends evidencing any such transfer restrictions.  

7.4Forfeiture. Subject to such exceptions as may be determined by the Administrator, upon the termination of the Grantee's Service for any reason prior to the expiration of the Restricted Period of an Award, any shares remaining subject to restrictions (after taking into account the provisions of Section 7.6) shall thereupon be forfeited by the Grantee and transferred to, and reacquired by, the Company at no cost to the Company, subject to all applicable law.

7.5Ownership. During the Restricted Period the Grantee shall possess all incidents of ownership of such shares of Restricted Stock, subject to Section 7.1, including the right to receive dividends with respect to such shares and to vote such shares.

8.Terms and Conditions of Stock Appreciation Right Grants

Stock Appreciation Rights shall be evidenced by Grant Agreements specifying the number of rights grants, in such form as the Administrator shall from time to time establish.  No Stock Appreciation Right or purported Stock Appreciation Right shall be a valid and binding obligation of the Company unless evidenced by a fully executed Grant Agreement.  Grant Agreements may incorporate all or any of the terms of the Plan by reference and shall comply with and be subject to the following terms and conditions:

8.1Value of Stock Appreciation Right.  Each Stock Appreciation Right shall entitle the Grantee to receive, subject to the terms and conditions of this Plan and the Grant Agreement relating thereto, a payment in an amount equal to the positive difference, if any, obtained by deducting (i) the Fair Market Value of one share of Stock as of the Stock Appreciation Right's grant date or such greater amount as may be set forth by the Committee in the Grant Agreement (the "Grant Value"), subject to adjustment in accordance with this Plan from (ii) the Fair Market Value of one share of Stock as of the exercise date for the Stock Appreciation Right.

8.2Exercise of Stock Appreciation Rights.  

(a)Election to Exercise Vested Stock Appreciation Right.  Any Stock Appreciation Right granted hereunder shall be exercisable at such times and under such conditions as determined by the Administrator, including performance criteria with respect to the Company, the Company and/or the Grantee, and as shall be permissible under the terms of the Plan. A Stock Appreciation Right may not be exercised with respect to a fraction of a Share. A Stock Appreciation Right shall be deemed to be exercised when written notice of such exercise has been given to the Company in accordance with the terms of the Grant Agreement by the person entitled to exercise the Stock Appreciation Right, which notice will specify the number of vested Stock Appreciation Rights which Grantee is electing to exercise.

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(b)Deemed Exercise of Stock Appreciation Rights.  Except as otherwise provided in the Grant Agreement and subject to any additional restrictions set forth in the Grant Agreement, upon the Grantee's termination of Service (whether due to death, Disability or any other reason) or upon a Change in Control, the Grantee will be deemed to have exercised all vested Stock Appreciation Rights.

8.3Exercise Period.  Stock Appreciation Rights shall be exercisable at such time or times, or upon such event or events, and subject to such terms, conditions, performance criteria, and restrictions as shall be determined by the Administrator and set forth in the Grant Agreement evidencing such Stock Appreciation Right; provided, however, that no Stock Appreciation Right shall be exercisable after the expiration of ten (10) years after the effective date of grant of such Stock Appreciation Right and unless otherwise permitted by applicable law, and with the exception of a Stock Appreciation Right granted to an officer, Director or Consultant, no Stock Appreciation Right shall become exercisable at a rate less than twenty percent (20%) per year over a period of five (5) years from the effective date of grant of such Stock Appreciation Right, subject to the Grantee's continued Service.  Subject to the foregoing, unless otherwise specified by the Administrator in the grant of a Stock Appreciation Right, any Stock Appreciation Right granted hereunder shall have a term of ten (10) years from the effective date of grant of the Stock Appreciation Right.

8.4Payment of Amount Due.  Payment of the amount due upon exercise of a Stock Appreciation Right shall be made (i) in cash, by check or cash equivalent, (ii) shares of Stock, (iii) by such other consideration as may be approved by the Administrator from time to time to the extent permitted by applicable law, or (iv) by any combination of the foregoing.  The Company shall pay the amount due within thirty (30) days of the exercise of the Stock Appreciation Right.

8.5Tax Withholding.  The Company shall have the right, but not the obligation, to deduct from the amount due upon exercise of a Appreciation Right an amount equal to all or any part of the federal, state, local and foreign taxes, if any, required by law to be withheld by the Company with respect to such Appreciation Right upon the exercise thereof.  Alternatively or in addition, in its discretion, the Administrator shall have the right to require the Grantee, through payroll withholding, cash payment or otherwise, to make adequate provision for any such tax withholding obligations of the Company arising in connection with the Appreciation Right upon the exercise thereof.  The Company shall have no obligation to pay any amounts due until the Company's tax withholding obligations have been satisfied by the Grantee.

8.6Adjustments.  If the Committee determines, in its sole discretion, that any distribution, merger, consolidation, reorganization, split-up, spin-off, subdivision, combination, share exchange, dividend, contribution, disposition or acquisition (either of equity or assets), warrants or rights offering to purchase interests in the Company or the Company, or other extraordinary event affects the Stock Appreciation Rights authorized and granted under this Plan such that an adjustment in such Stock Appreciation Rights is required in order to preserve the level of benefits or potential benefits (without enlargement or dilution of such benefits) intended to accrue to the Grantees under this Plan, then the Committee, in its sole discretion, shall make such adjustments in the Stock Appreciation Rights (including increases or decreases to the Grant Value of a Stock Appreciation Right, increases or decreases to the number of Stock Appreciation Rights granted and/or changes to the equity to which the value of a Stock Appreciation Right is tied) and/or the terms of this Plan relating to the valuation of a Stock Appreciation Right in such manner as the Committee, in its sole discretion, deems appropriate and equitable.  The Committee may make any such adjustment for all Grantees and all Stock Appreciation Rights, or the Committee, in its sole discretion, may make such adjustments only for such Grantees or such Stock Appreciation Rights as it deems appropriate; provided that any such adjustment is made in compliance with the requirements ofCode Section 409A relating to "stock rights" that do not constitute nonqualified deferred compensation for purposes of Code Section 409A.  In addition, the Committee may, without the consent of any Grantee, convert or exchange the Stock Appreciation Rights granted pursuant to this Plan for an equity award that is based on or tied to the value of any person whose assets include the ownership of 50% or more of the Company; provided that any such conversion or exchange is made in compliance with the requirements ofCode Section 409A relating to "stock rights" that do not constitute nonqualified deferred compensation for purposes of Code Section 409A.

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8.7No Rights as a Shareholder.  At no time with the Grantee be considered a shareholder of the Company or have any rights as a shareholder; the right to vote or receive dividends or any other rights as a shareholder shall never exist with respect to a Stock Appreciation Right, notwithstanding the exercise of the Stock Appreciation Right. Exercise of a Stock Appreciation Right in any manner shall result in a decrease in the number rights which thereafter may be available, both for purposes of the Plan and for exercise under the Stock Appreciation Right, by the number of rights to which the Stock Appreciation Right is exercised.

8.8Buyout Provisions.  The Administrator may at any time offer to buy out, for a payment in cash or shares of Stock, a Stock Appreciation Right previously granted, based on such terms and conditions as the Administrator shall establish and communicate to the Grantee at the time that such offer is made.

9.Standard Forms of Grant Agreement.

9.1General.  Unless otherwise provided by the Administrator at the time the Award is granted, an Award shall comply with and be subject to the terms and conditions set forth in the standard form of Grant Agreement in effect at the time of the grant.

9.2Authority to Vary Terms.  The Administrator shall have the authority from time to time to vary the terms of any of the standard form of Grant Agreement described in this Section 9 either in connection with the grant or amendment of an individual Award or in connection with the authorization of a new standard form or forms; provided, however, that the terms and conditions of any such new, revised or amended standard form or forms of Grant Agreement are not inconsistent with the terms of the Plan.

10.Change in Control.

10.1Definitions.

(a)An "Ownership Change Event" shall be deemed to have occurred if any of the following occurs with respect to the Company: (i) the direct or indirect sale or exchange in a single or series of related transactions by the shareholders of the Company of more than fifty percent (50%) of the voting stock of the Company; (ii) a merger or consolidation in which the Company is a party; (iii) the sale, exchange, or transfer of all or substantially all of the assets of the Company; or (iv) a liquidation or dissolution of the Company.

(b)A "Change in Control" shall mean an Ownership Change Event or a series of related Ownership Change Events (collectively, a "Transaction") wherein the shareholders of the Company immediately before the Transaction do not retain immediately after the Transaction, in substantially the same proportions as their ownership of shares of the Company's voting stock immediately before the Transaction, direct or indirect beneficial ownership of more than fifty percent (50%) of the total combined voting power of the outstanding voting stock of the Company or the corporation or corporations to which the assets of the Company were transferred (the "Transferee Corporation(s)"), as the case may be.  For purposes of the preceding sentence, indirect beneficial ownership shall include, without limitation, an interest resulting from ownership of the voting stock of one or more corporations which, as a result of the Transaction, own the Company or the Transferee Corporation(s), as the case may be, either directly or through one or more subsidiary corporations.  The Board shall have the right to determine whether multiple sales or exchanges of the voting stock of the Company or multiple Ownership Change Events are related, and its determination shall be final, binding and conclusive.

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10.2Effect of Change in Control on Options.  In the event of a Change in Control, the surviving, continuing, successor, or purchasing corporation or parent corporation thereof, as the case may be (the "Acquiring Corporation"), may either assume the Company's rights and obligations under outstanding Options or substitute for outstanding Options substantially equivalent options for the Acquiring Corporation's stock.  In the event the Acquiring Corporation elects not to assume or substitute for outstanding Options in connection with a Change in Control, any unexercisable or unvested portions of outstanding Options and any shares acquired upon the exercise thereof held by Grantees whose Service has not terminated prior to such date shall be immediately exercisable and vested in full as of the date ten (10) days prior to the date of the Change in Control.  The exercise or vesting of any Option and any shares acquired upon the exercise thereof that was permissible solely by reason of this Section 10.2 shall be conditioned upon the consummation of the Change in Control.  Any Options which are neither assumed or substituted for by the Acquiring Corporation in connection with the Change in Control nor exercised as of the date of the Change in Control shall terminate and cease to be outstanding effective as of the date of the Change in Control.  Notwithstanding the foregoing, shares acquired upon exercise of an Option prior to the Change in Control and any consideration received pursuant to the Change in Control with respect to such shares shall continue to be subject to all applicable provisions of the Grant Agreement evidencing such Option except as otherwise provided in such Grant Agreement.  Furthermore, notwithstanding the foregoing, if the corporation the stock of which is subject to the outstanding Options immediately prior to an Ownership Change Event described in Section 10.1(a)(i) constituting a Change in Control is the surviving or continuing corporation and immediately after such Ownership Change Event less than fifty percent (50%) of the total combined voting power of its voting stock is held by another corporation or by other corporations that are members of an affiliated group within the meaning of Section 1504(a) of the Code without regard to the provisions of Section 1504(b) of the Code, the outstanding Options shall not terminate unless the Board otherwise provides in its discretion.

10.3Effect of Change in Control on Restricted Stock.  In the event of a Change in Control, all restrictions then outstanding with respect to shares of Restricted Stock awarded hereunder shall automatically expire and be of no further force and effect. The Administrator shall have the authority (and the Grant Agreement may so provide) to cancel all or any portion of any outstanding restrictions prior to the expiration of the Restricted Period with respect to any or all of the shares of Restricted Stock awarded on such terms and conditions as the Administrator shall deem appropriate.

10.4Effect of Change in Control on Stock Appreciation Rights.  In the event of a Change in Control, all outstanding Stock Appreciation Rights shall become fully vested.

11.Provision of Information.

Unless not required by applicable law, at least annually, copies of the Company's balance sheet and income statement for the just completed fiscal year shall be made available to each Grantee and purchaser of shares of Stock upon the exercise of an Option.  The Company shall not be required to provide such information to key employees whose duties in connection with the Company assure them access to equivalent information.

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12.Nontransferability of Awards.

During the lifetime of the Grantee, an Award shall be exercisable only by the Grantee or the Grantee's guardian or legal representative.  No Award shall be assignable or transferable by the Grantee, except by will or by the laws of descent and distribution.  Any unauthorized attempt at assignment, transfer, pledge or other disposition shall be without effect and void ab initio and without effect.

13.Compliance with Securities Law.

The grant of Awards and the issuance of shares of Stock pursuant to Awards shall be subject to compliance with all applicable requirements of federal, state and foreign law with respect to such securities.  Awards may not be exercised if the issuance of shares of Stock upon exercise would constitute a violation of any applicable federal, state or foreign securities laws or other law or regulations or the requirements of any stock exchange or market system upon which the Stock may then be listed.  In addition, no Award may be exercised unless (a) a registration statement under the Securities Act shall at the time of exercise of the Award be in effect with respect to the shares issuable upon exercise of the Award or (b) in the opinion of legal counsel to the Company, the shares issuable upon exercise of the Award may be issued in accordance with the terms of an applicable exemption from the registration requirements of the Securities Act.  The inability of the Company to obtain from any regulatory body having jurisdiction the authority, if any, deemed by the Company's legal counsel to be necessary to the lawful issuance and sale of any shares hereunder shall relieve the Company of any liability in respect of the failure to issue or sell such shares as to which such requisite authority shall not have been obtained.  As a condition to the exercise of any Award or the receipt of any Stock pursuant to this Plan, the Company may require the Grantee to satisfy any qualifications that may be necessary or appropriate, to evidence compliance with any applicable law or regulation and to make any representation or warranty with respect thereto as may be requested by the Company.

14.Indemnification.

In addition to such other rights of indemnification as they may have as members of the Board or officers or employees of the Company, members of the Board and any officers or employees of the Company to whom authority to act for the Board or the Company is delegated shall be indemnified by the Company against all reasonable expenses, including attorneys' fees, actually and necessarily incurred in connection with the defense of any action, suit or proceeding, or in connection with any appeal therein, to which they or any of them may be a party by reason of any action taken or failure to act under or in connection with the Plan, or any right granted hereunder, and against all amounts paid by them in settlement thereof (provided such settlement is approved by independent legal counsel selected by the Company) or paid by them in satisfaction of a judgment in any such action, suit or proceeding, except in relation to matters as to which it shall be adjudged in such action, suit or proceeding that such person is liable for gross negligence, bad faith or intentional misconduct in duties; provided, however, that within sixty (60) days after the institution of such action, suit or proceeding, such person shall offer to the Company, in writing, the opportunity at its own expense to handle and defend the same.

15.Termination or Amendment of Plan.

The Board may terminate or amend the Plan at any time.  However, subject to changes in applicable law, regulations or rules that would permit otherwise, without the approval of the Company's shareholders, there shall be (a) no increase in the maximum aggregate number of shares of Stock that may be issued under the Plan (except by operation of the provisions of Section 4.2), (b) no change in the class of persons eligible to receive Incentive Stock Options, and (c) no other amendment of the Plan that would require approval of the Company's shareholders under any applicable law, regulation or rule.  No termination or amendment of the Plan may adversely affect any then outstanding Award or any unexercised portion thereof, without the consent of the Grantee, unless such termination or amendment is required to enable an Award designated as an Incentive Stock Option to qualify as an Incentive Stock Option or is necessary to comply with any applicable law, regulation or rule.

15

16.No Enlargement of Employee Rights.

This Plan is strictly a voluntary undertaking on the part of the Company and shall not be deemed to constitute a contract between the Company and any Grantee to be consideration for, or an inducement to, or a condition of, the employment of any Grantee.  Nothing contained in the Plan shall be deemed to give the right to any Grantee to be retained as an employee of the Company or to interfere with the right of the Company to discharge any Grantee at any time.

17.Application of Funds.

The proceeds received by the Company from the sale of Stock pursuant to Grant Agreements, except as otherwise provided herein, will be used for general corporate purposes.

18.Shareholder Approval.

The Plan or any increase in the maximum aggregate number of shares of Stock issuable thereunder as provided in Section 4.1 (the "Authorized Shares") shall be approved by the shareholders of the Company within twelve (12) months of the date of adoption thereof by the Board.  Awards granted prior to shareholder approval of the Plan or in excess of the Authorized Shares previously approved by the shareholders shall become exercisable no earlier than the date of shareholder approval of the Plan or such increase in the Authorized Shares, as the case may be.

19.Reservation of Stock.

The Company, during the term of this Plan, will at all times reserve and keep available such number of shares of Stock as shall be sufficient to satisfy the requirements of the Plan. The inability of the Company to obtain authority from any regulatory body having jurisdiction, which authority is deemed by the Company's counsel to be necessary to the lawful issuance and sale of any Stock hereunder, shall relieve the Company of any liability in respect of the failure to issue or sell such Stock as to which such requisite authority shall not have been obtained.

20.Information to Grantees and Purchasers.

The Company shall make available to each Grantee, during the period such Grantee has one or more Awards outstanding, copies of annual financial statements.  The Company shall not be required to provide such statements to key employees whose duties in connection with the Company assure their access to equivalent information.

21.Certain Tax Matters.

The Administrator may require the holder of any Award or Stock received pursuant to this Plan to remit to the Company, regardless of when such liability arises, an amount sufficient to satisfy any Federal, state and local tax withholding requirements associated with such Award or Stock.  The Administrator may, in its discretion, permit the holder of Stock to satisfy any such obligation by having withheld from the shares (or where applicable, cash) to be delivered to the holder of upon exercise of an Option a number of shares (or, where applicable, amount of cash) sufficient to meet any such withholding requirement.  If a Grantee makes an election under Section 83(b) of the Code with respect to the receipt of any Award, or disposes of Stock acquired pursuant to the exercise of an Incentive Stock Option in a transaction deemed to be a disqualifying disposition under Section 421 of the Code, then, within thirty (30) days of such Section 83(b) election or disqualifying disposition, the Participant shall inform the Company of such actions.

16

22.Repurchase Rights.

The Administrator may, in its discretion, subject any Award to repurchase rights provisions.  The terms and conditions of any repurchase rights will be established by the Administrator in its sole discretion and shall be set forth in the Grant Agreement representing the Award.  To ensure that shares of Stock subject to a repurchase right under this Section 22 will be available for repurchase, the Administrator may require the holder of an Award to deposit the certificate or certificates evidencing such shares with an agent designated by the Administrator under the terms and conditions of escrow and security agreements approved by the Administrator.

23.Right of First Refusal.

The Administrator may, in its discretion, subject any Award to right of first refusal provisions.  The terms and conditions of any right of first refusal provisions will be established by the Administrator in its sole discretion and set forth in the Grant Agreement representing the Award.

24.Non-Exclusivity of the Plan.

Neither the adoption of the Plan by the Board nor the submission of the Plan to stockholders of the Company for approval shall be construed as creating any limitations on the power or authority of the Board to adopt such other or additional incentive or other compensation arrangements of whatever nature as the Board may deem necessary or desirable or preclude or limit the continuation of any other plan, practice or arrangement for the payment of compensation or fringe benefits to employees generally, or to any class or group of employees, which the Company now has lawfully put into effect, including, without limitation, any retirement, pension, savings and stock purchase plan, insurance, death and disability benefits and executive short-term or long-term incentive plans.

17

EX-31.1

Exhibit 31.1

CERTIFICATIONS

I, Kent B. Wilson, certify that:

1.            I have reviewed this Quarterly Report on Form 10-Q of Alpine 4 Technologies Ltd.;

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 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 report;

4.            The registrant's other certifying officer(s) and I are 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 15d-15(f)) for the registrant and have:

a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our 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; and

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 registrant's fourth fiscal quarter in the case of the annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and

5.            The registrant's other certifying officer(s) and I have disclosed, based on our 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) All significant 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:  November 14, 2016

By: /s/ Kent B. Wilson

Kent B. Wilson

Chief Executive Officer

(Principal Executive Officer)

EX-31.2

Exhibit 32.1

CERTIFICATIONS

I, David G. Schmitt, certify that:

1.            I have reviewed this Quarterly Report on Form 10-Q of Alpine 4 Technologies Ltd.;

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 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 report;

4.            The registrant's other certifying officer(s) and I are 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 15d-15(f)) for the registrant and have:

a)  Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our 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; and

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 registrant's fourth fiscal quarter in the case of the annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and

5.            The registrant's other certifying officer(s) and I have disclosed, based on our 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)  All significant 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:  November 14, 2016

By: /s/ David G. Schmitt

David G. Schmitt

Chief Financial Officer

(Principal Financial Officer)

EX-32.1

Exhibit 32.1

CERTIFICATION PURSUANT TO

18 U.S.C. SECTION 1350,

AS ADOPTED PURSUANT TO

SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

In connection with the Quarterly Report on Form 10-Q of Alpine 4 Technologies Ltd. (the "Company") for the quarter ending September 30, 2016, as filed with the Securities and Exchange Commission on the date hereof (the "Report"), Kent B. Wilson, Chief Executive Officer of the Company, hereby certifies, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that to his knowledge:

(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 the Company.

Dated:  November 14, 2016	By: /s/ Kent B. Wilson
	Kent B. Wilson
	Chief Executive Officer

This certification accompanies each Report pursuant to § 906 of the Sarbanes-Oxley Act of 2002 and shall not, except to the extent required by the Sarbanes-Oxley Act of 2002, be deemed filed by the Company for purposes of §18 of the Securities Exchange Act of 1934, as amended.

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

EX-32.1

Exhibit 32.2

CERTIFICATION PURSUANT TO

18 U.S.C. SECTION 1350,

AS ADOPTED PURSUANT TO

SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

In connection with the Quarterly Report on Form 10-Q of Alpine 4 Technologies Ltd. (the "Company") for the quarter ending September 30, 2016, as filed with the Securities and Exchange Commission on the date hereof (the "Report"), David G. Schmitt, Chief Financial Officer of the Company, hereby certifies, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that to his knowledge:

(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 the Company.

Dated:  November 14, 2016	By: /s/ David G. Schmitt
	David G. Schmitt
	Chief Financial Officer

This certification accompanies each Report pursuant to § 906 of the Sarbanes-Oxley Act of 2002 and shall not, except to the extent required by the Sarbanes-Oxley Act of 2002, be deemed filed by the Company for purposes of §18 of the Securities Exchange Act of 1934, as amended.

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

XML

Document and Entity Information - shares	9 Months Ended
	Sep. 30, 2016	Nov. 14, 2016
Entity Registrant Name	Alpine 4 Technologies Ltd.
Document Type	10-Q
Document Period End Date	Sep. 30, 2016
Trading Symbol	alpine
Amendment Flag	false
Entity Central Index Key	0001606698
Current Fiscal Year End Date	--12-31
Entity Filer Category	Smaller Reporting Company
Entity Current Reporting Status	Yes
Entity Voluntary Filers	No
Entity Well-known Seasoned Issuer	No
Document Fiscal Year Focus	2016
Document Fiscal Period Focus	Q3
Common Class A
Entity Common Stock, Shares Outstanding		21,281,117
Common Class B
Entity Common Stock, Shares Outstanding		1,600,000

XML

CONSOLIDATED BALANCE SHEET - USD ($)	Sep. 30, 2016	Dec. 31, 2015
CURRENT LIABILITIES:
Financing Obligation Lease: current	$ 13,562
NON-CURRENT LIABILITIES:
Financing Obligation Lease: non-current	6,540,225
Successor
CURRENT ASSETS:
Cash	117,782
Accounts receivable	1,348,290
Inventory	994,061
Prepaid expenses and other current assets	144,500
Total current assets	2,604,633
Property and equipment, net	4,976,261
Intangible asset, net	439,433
Goodwill	2,491,945
Other non-current assets	579,636
Total non-current assets	8,487,275
TOTAL ASSETS	11,091,908
CURRENT LIABILITIES:
Accounts payable	1,307,264
Accrued expenses	366,272
Deferred revenue
Deposits	2,530
Notes payable	844,042
Notes payable, related parties	30,000
Convertible notes payable, net of discount of $49,319 and $0	361,457
Financing Obligation Lease: current	13,562
Total Current Liabilities	2,925,127
NON-CURRENT LIABILITIES:
Long-term debt	148,823
Convertible notes payable	1,801,551
Financing Obligation Lease: non-current	6,540,225
Deferred tax liability	346,310
Total non-current liabilities	8,836,909
TOTAL LIABILITIES	11,762,036
STOCKHOLDERS' EQUITY (DEFICIT):
Preferred stock, $0.0001 par value, 5,000,000 shares authorized,none issued and outstanding
Common stock
Predecessor Common stock
Additional paid-in capital	15,652,220
Dividends
Accumulated earnings/(deficit)	(16,324,636)
Total stockholders' equity/(deficit)	(670,128)
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY (DEFICIT)	11,091,908
Successor | Class A Common Stock
STOCKHOLDERS' EQUITY (DEFICIT):
Common stock	2,128
Successor | Class B Common Stock
STOCKHOLDERS' EQUITY (DEFICIT):
Common stock	$ 160
Predecessor
CURRENT ASSETS:
Cash		$ 365,221
Accounts receivable		1,091,953
Inventory		949,362
Prepaid expenses and other current assets		12,193
Total current assets		2,418,729
Property and equipment, net		166,263
Intangible asset, net
Goodwill
Other non-current assets
Total non-current assets		166,263
TOTAL ASSETS		2,584,992
CURRENT LIABILITIES:
Accounts payable		655,942
Accrued expenses		116,984
Deferred revenue		202,049
Deposits
Notes payable		19,940
Notes payable, related parties		10,000
Convertible notes payable, net of discount of $49,319 and $0
Financing Obligation Lease: current
Total Current Liabilities		1,004,915
NON-CURRENT LIABILITIES:
Long-term debt		39,522
Convertible notes payable
Financing Obligation Lease: non-current
Deferred tax liability		66,970
Total non-current liabilities		106,492
TOTAL LIABILITIES		1,111,407
STOCKHOLDERS' EQUITY (DEFICIT):
Preferred stock, $0.0001 par value, 5,000,000 shares authorized,none issued and outstanding
Common stock
Predecessor Common stock		240,000
Additional paid-in capital
Dividends		(129,253)
Accumulated earnings/(deficit)		1,362,838
Total stockholders' equity/(deficit)		1,473,585
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY (DEFICIT)		2,584,992
Predecessor | Class A Common Stock
STOCKHOLDERS' EQUITY (DEFICIT):
Common stock
Predecessor | Class B Common Stock
STOCKHOLDERS' EQUITY (DEFICIT):
Common stock

XML

CONSOLIDATED BALANCE SHEETS PARENTHETICAL - USD ($)	Sep. 30, 2016	Dec. 31, 2015
Debt Discount, Convertible Debt	$ 49,319
Preferred stock par value	$ 0.0001	$ 0.0001
Preferred stock shares authorized	5,000,000	5,000,000
Preferred stock shares issued
Preferred stock shares outstanding
Class A Common Stock
Common stock par value	$ 0.0001	$ 0.0001
Common stock shares authorized	500,000,000	500,000,000
Common stock shares issued	21,281,117	6,730,162
Common stock shares outstanding	21,281,117	6,730,162
Class B Common Stock
Common stock par value	$ 0.0001	$ 0.0001
Common stock shares authorized	100,000,000	100,000,000
Common stock shares issued	1,600,000
Common stock shares outstanding	1,600,000

XML

CONSOLIDATED STATEMENT OF OPERATIONS - USD ($)	3 Months Ended			6 Months Ended	9 Months Ended
	Sep. 30, 2016	Mar. 31, 2016	Sep. 30, 2015	Sep. 30, 2016	Sep. 30, 2015
Successor
Revenue	$ 2,258,099			$ 4,294,535
Cost of revenue	1,410,772			2,730,395
Gross Profit	847,327			1,564,140
Operating expenses:
General and administrative expenses	937,449			2,858,163
Depreciation	104,455			175,625
Amortization	10,901			21,734
Total operating expenses	1,052,805			3,055,522
Loss from operations	(205,478)			(1,491,382)
Other expenses
Interest expense	366,825			627,515
Other expenses/(income)	(49,173)			(101,121)
Total other expenses	317,652			526,394
Loss before income tax	(523,130)			(2,017,776)
Income tax	(964)			7,411
Net loss	$ (522,166)			$ (2,025,187)
Weighted average shares outstanding :
Weighted average shares outstanding: Basic	22,842,265			22,760,422
Weighted average shares outstanding: Diluted	22,842,265			22,760,422
Loss per share
Loss per share: Basic	$ (0.02)			$ (0.09)
Loss per share: Diluted	$ (0.02)			$ (0.09)
Predecessor
Revenue		$ 1,788,654	$ 1,824,719		$ 5,971,309
Cost of revenue		1,337,083	1,427,514		4,615,800
Gross Profit		451,571	397,205		1,355,509
Operating expenses:
General and administrative expenses		490,091	279,856		1,189,649
Depreciation		33,492	33,492		100,475
Amortization
Total operating expenses		523,583	313,348		1,290,124
Loss from operations		(72,012)	83,857		65,385
Other expenses
Interest expense		456	555		1,822
Other expenses/(income)
Total other expenses		456	555		1,822
Loss before income tax		(72,468)	83,302		63,563
Income tax		(31,770)	43,339		78,277
Net loss		$ (40,698)	$ 39,963		$ (14,714)
Weighted average shares outstanding :
Weighted average shares outstanding: Basic
Weighted average shares outstanding: Diluted
Loss per share
Loss per share: Basic		$ 0.00	$ 0.00		$ 0.00
Loss per share: Diluted		$ 0.00	$ 0.00		$ 0.00

XML

CONSOLIDATED STATEMENT OF CASH FLOWS - USD ($)	3 Months Ended		6 Months Ended	9 Months Ended
	Sep. 30, 2016	Mar. 31, 2016	Sep. 30, 2016	Sep. 30, 2015
Adjustments to reconcile net loss to net cash used in operating activities:
Amortization of debt discounts	$ 139,748
SUPPLEMENTAL DISCLOSURE OF NON-CASH FINANCING ACTIVITIES:
Issuance of note payable for acquisition of QCA	2,000,000
Successor
OPERATING ACTIVITIES:
Net loss	(522,166)		$ (2,025,187)
Adjustments to reconcile net loss to net cash used in operating activities:
Depreciation	104,455		175,625
Amortization	10,901		21,734
Employee stock compensation			1,062,500
Stock issued for services			406,740
Amortization of debt issuance			4,493
Amortization of debt discounts			226,913
Change in current assets and liabilities:
Change in Accounts receivable			(303,735)
Change in Inventory			179,293
Change in Prepaids			(110,748)
Change in Accounts payable			149,813
Change in Accrued expenses			244,388
Change in Deferred revenue			(998)
Change in Taxes payable
Net cash provided (used) in operating activities			30,831
INVESTING ACTIVITIES:
Capital expenditures			(169,500)
Acquisition, net of cash acquired			(2,800,000)
Net cash used by investing activities			(2,969,500)
FINANCING ACTIVITIES:
Proceeds from issuances of notes payable, related party
Proceeds from issuances of notes payable, non-related party			2,499,847
Repayments issuances of notes payable, non-related party			(1,834,482)
Repayments of notes, related party			(1,535)
Repayments of notes payable, non-related party			(43,323)
Proceeds from convertible notes payable	12,500		12,500
Proceeds from the sale of common stock			6,000
Net Proceeds from financing lease obligation, net of commissions and financing charges			2,704,260
Change in restricted cash			(532,969)
Cash paid for rent deposit on lease of building			(46,667)
Cash paid on financing lease obligation			(49,966)
Net cash provided (used) by financing activities			2,713,665
NET INCREASE (DECREASE) IN CASH			(225,004)
CASH, BEGINNING BALANCE			342,786
CASH, ENDING BALANCE	117,782	$ 342,786	117,782
CASH PAID FOR:
Interest			217,791
Income taxes
SUPPLEMENTAL DISCLOSURE OF NON-CASH FINANCING ACTIVITIES:
Common stock issued for convertible note payable and accrued interest			159,830
Issuance of note payable for acquisition of QCA	2,000,000		2,000,000
Purchase of building from lease proceeds			3,895,000
Debt discount from convertible note payable	$ (113,810)		113,810
Predecessor
OPERATING ACTIVITIES:
Net loss		(40,698)		$ (14,714)
Adjustments to reconcile net loss to net cash used in operating activities:
Depreciation		33,492		100,475
Amortization
Employee stock compensation
Stock issued for services
Amortization of debt issuance
Amortization of debt discounts
Change in current assets and liabilities:
Change in Accounts receivable		(3,466)		(83,595)
Change in Inventory		(423)		(304)
Change in Prepaids		(41,342)		(17,352)
Change in Accounts payable		(3,314)		143,689
Change in Accrued expenses		24,461		(27,531)
Change in Deferred revenue				202,049
Change in Taxes payable		(41,645)		(164,068)
Net cash provided (used) in operating activities		(72,935)		138,649
INVESTING ACTIVITIES:
Capital expenditures				(14,024)
Acquisition, net of cash acquired
Net cash used by investing activities				(14,024)
FINANCING ACTIVITIES:
Proceeds from issuances of notes payable, related party				45,000
Proceeds from issuances of notes payable, non-related party
Repayments issuances of notes payable, non-related party
Repayments of notes, related party		(10,000)
Repayments of notes payable, non-related party		(59,461)		(14,437)
Proceeds from convertible notes payable
Proceeds from the sale of common stock
Net Proceeds from financing lease obligation, net of commissions and financing charges
Change in restricted cash
Cash paid for rent deposit on lease of building
Cash paid on financing lease obligation
Net cash provided (used) by financing activities		(69,461)		30,563
NET INCREASE (DECREASE) IN CASH		(142,396)		155,188
CASH, BEGINNING BALANCE		365,221	$ 222,825	224,290
CASH, ENDING BALANCE		222,825		379,478
CASH PAID FOR:
Interest		456		1,841
Income taxes		47,500		308,652
SUPPLEMENTAL DISCLOSURE OF NON-CASH FINANCING ACTIVITIES:
Common stock issued for convertible note payable and accrued interest
Issuance of note payable for acquisition of QCA
Purchase of building from lease proceeds
Debt discount from convertible note payable

XML

Note 1 - Organization and Basis of Presentation

9 Months Ended

Sep. 30, 2016

Notes

Note 1 - Organization and Basis of Presentation

Note 1 – Organization and Basis of Presentation

The unaudited financial statements were prepared by Alpine 4 Technologies Ltd. (the “Company”), pursuant to the rules and regulations of the Securities Exchange Commission (“SEC”). The information furnished herein reflects all adjustments (consisting of normal recurring accruals and adjustments) which are, in the opinion of management, necessary to fairly present the operating results for the respective periods. Certain information and footnote disclosures normally present in annual financial statements prepared in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”) were omitted pursuant to such rules and regulations. These financial statements should be read in conjunction with the audited financial statements and footnotes included in the Company’s Annual Report on Form 10-K filed with the SEC on March 28, 2016. The results for the nine months ended September 30, 2016, are not necessarily indicative of the results to be expected for the year ending December 31, 2016.

Description of Business

Alpine 4 Technologies Ltd. (the "Company") was incorporated under the laws of the State of Delaware on April 22, 2014.  The Company was formed to serve as a vehicle to affect an asset acquisition, merger, exchange of capital stock, or other business combination with a domestic or foreign business.  As of the date of this Report, the Company was a technology holding company with a heavy concentration in the automotive industry. The Company provides a distinctive and powerful advantage to management, sales, finance, and service departments at automotive dealerships in order to increase productivity, profitability and customer retention through the Company's flagship program, 6th Sense Auto. The 6th Sense Auto program uses disruptive technology to improve inventory management, reduce costs, increase sales and enhance service. The 6th Sense Auto program serves a two-fold solution addressing both business to business and business to consumer market needs.

Acquisition Reporting

As discussed in note 9, the Company entered into a stock purchase transaction with Quality Circuit Assembly, Inc. (“QCA”) in which the Company purchased 100% of QCA’s stock.

The consolidated financial statements herein are presented under predecessor entity reporting and because the acquiring entity had nominal operations as compared with the acquired company, QCA, prior historical information of the acquirer is not presented.

This new basis of accounting was created on April 1, 2016, the effective date for financial reporting purposes of the stock purchase agreement.  In the following discussion, the results of the operations and cash flows for the periods ended on or prior to March 31, 2016, and the financial position of QCA as of balance sheet date on or prior to March 31, 2016 are referred to as “Predecessor” financial information, and the results of operations and cash flows of the Company for periods beginning April 1, 2016 and the financial position of the Company as of April 1, 2016 and subsequent balance sheet dates are referred to herein as “Successor” consolidated financial information.

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Note 2 - Summary of Significant Accounting Policies

9 Months Ended

Sep. 30, 2016

Notes

Note 2 - Summary of Significant Accounting Policies

Note 2 - Summary of Significant Accounting Policies

Principles of consolidation

The consolidated financial statements include the accounts of the Company and its wholly-owned subsidiaries as of September 30, 2016 (Successor) and December 31, 2015 (Predecessor).  Significant intercompany balances and transactions have been eliminated.

Basis of presentation

The accompanying financial statements present the balance sheets, statements of operations, stockholders’ deficit and cash flows of the Company. The financial statements have been prepared in accordance with U.S. GAAP.

Use of estimates

The preparation of financial statements in conformity with U.S. GAAP requires the Company to make estimates and judgments that affect the reported amounts of assets and liabilities, revenues and expenses, and related disclosures of contingent assets and liabilities.  These estimates and judgments are based on historical information, information that is currently available to the Company and on various other assumptions that the Company believes to be reasonable under the circumstances.  Actual results could differ from those estimates.

Cash

Cash and cash equivalents consist of cash and short-term investments with original maturities of less than 90 days.  Cash equivalents are placed with high credit quality financial institutions and are primarily in money market funds.  The carrying value of those investments approximates fair value.

Major Customers

For all periods presented the Company had two customers that made up approximately 50% of total revenues.  All other customers were less than 10% each of total revenues in each period.

For all periods presented the Company had two customers that made up approximately 50% of outstanding accounts receivable.  All other customers were less than 10% each of total accounts receivable for each period presented.

Accounts Receivable

The Company maintains reserves for potential credit losses on accounts receivable. Management reviews the composition of accounts receivable and analyzes historical bad debts, customer concentrations, customer credit worthiness, current economic trends and changes in customer payment patterns to evaluate the adequacy of these reserves. Reserves are recorded primarily on a specific identification basis.

Inventory

Inventory is valued at the lower of the inventory’s cost (weighted average basis) or market. Management compares the cost of inventory with its market value and an allowance is made to write down inventory to market value, if lower.  Inventory is segregated into four areas, raw materials, WIP, finished goods, and In-Transit.  Below is a breakdown of how much inventory is in each area as of September 30, 2016 (Successor) and December 31, 2015 (Predecessor).

	Sep 30, 2016 (Successor)	December 31, 2015 (Predecessor)
Raw materials	$         421,970	$                 391,845
WIP	246,226	351,697
Finished goods	312,865	192,820
In Transit	13,000	13,000
	$         994,061	$                 949,362

Property and Equipment

Property and equipment are carried at cost less depreciation. Depreciation and amortization are provided principally on the straight-line method over the estimated useful lives of the assets, which range from five years to 39 years as follows:

Buildings                                                               39 years

Equipment                                                            5 years

Maintenance and repair costs are charged against income as incurred.  Significant improvements or betterments are capitalized and depreciated over the estimated life of the asset.

Below is a table of Property and Equipment

Property and Equipment
		Sep 30, 2016 (Successor)		Dec 31, 2015 (Predecessor)
Machinery & Equipment	$	1,256,885	$	1,191,843
Office furniture & fixtures		-		164,868
Building		3,895,000		-
Less: Accumulated Depreciation		(175,624)		(1,190,448)
	$	4,976,261	$	166,263

Purchased Intangibles and Other Long-Lived Assets

The Company amortizes intangible assets with finite lives over their estimated useful lives, which range between five and fifteen years as follows:

Leasehold Improvements                                  15 years

Non-compete agreements                                  5 years

Software development                                       5 years

Below are tables for Intangibles and Other Long-Lived Assets

Intangibles
		Sep 30, 2016 (Successor)			Dec 31, 2015 (Predecessor)
Leasehold Improvements	$	140,200	$		-
Software		179,300			-
Noncompete		100,000			-
Other		50,000			-
Less: Accumulated Amortization		(30,067)		-
	$	439,433	$		-

Other Intangibles consist of QCA’s trade name, long lived customer relationships and customer lists.

Other Non-Current Assets
		Sep 30, 2016 (Successor)		Dec 31, 2015 (Predecessor)
Restricted Cash	$	525,270	$	-
Deposits		54,366		-
	$	579,636	$	-

Impairment of Long-Lived Assets

The Company accounts for long-lived assets in accordance with the provisions of FASB Topic 360, “Accounting for the Impairment of Long-Lived Assets”.  This statement requires that long-lived assets and certain identifiable intangibles be reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable.  An impairment loss would be recognized when the estimated future cash flows from the use of the asset are less than the carrying amount of that asset.  During the three and six months ended September 30, 2016 (Successor), the period from January 1, 2016 through March 31, 2016 (Predecessor) and the nine months ended September 30, 2015 (Predecessor), there have been no impairment losses.

Goodwill

In financial reporting goodwill is not amortized, but is tested for impairment annually in the fourth quarter of the fiscal year or whenever events or changes in circumstances indicate that the carrying amount may not be recoverable.  Events that result in an impairment review include significant changes in the business climate, declines in our operating results, or an expectation that the carrying amount may not be recoverable.  We assess potential impairment by considering present economic conditions as well as future expectations.

We review goodwill for impairment by performing a two-step goodwill impairment test.  The first step of the two-step goodwill impairment test is to compare the fair value of the reporting unit to its carrying amount, including goodwill.  If the carrying amount of the reporting unit exceeds its fair value, the second step of the two-step goodwill impairment test is required to measure the goodwill impairment loss.

The second step includes valuing all the tangible and intangible assets of the reporting unit as if the reporting unit had been acquired in a business combination.  Then, the implied fair value of the reporting unit’s goodwill is compared to the carrying amount of that goodwill.  If the carrying amount of the reporting unit’s goodwill exceeds the implied fair value of the goodwill, we recognize an impairment loss in an amount equal to the excess, not to exceed the carrying amount.

The Company has recorded no impairment of goodwill in any period presented.

Fair Value Measurement

The Company’s financial instruments consist of cash and cash equivalents, accounts receivable, accounts payable, accrued expenses, convertible notes, notes and line of credit.  The carrying amount of these financial instruments approximates fair value due either to length of maturity or interest rates that approximate prevailing market rates unless otherwise disclosed in these financial statements.

Revenue Recognition

The Company has a portfolio of consumer and professional software applications called 6thSenseAuto, which consists primarily of the Company's two products previously branded as LotWatch and ServiceWatch .

LotWatch is a product for dealerships to give them vehicle inventory information. Our telematics devices use information gathered from the OBD (On Board Diagnostics) port, and by utilizing both GPS technology and cellular based service, the LotWatch module provides specific, real-time, accurate information about a dealership's fleet of new vehicles. This information can be easily accessed and viewed on Alpine 4's interface anywhere the dealership have internet access.

ServiceWatch is a product for the driving consumer that also uses information gathered from the OBD port.  By utilizing both GPS technology and cellular based service, the ServiceWatch module provides vehicle specific real-time, accurate information to a dealership's service department to increase sales all while improving their level of service.

When the Company enters into an agreement with a car dealership that wants to utilize its LotWatch service, a telematics device must be installed in each vehicle.  The Company will generally charge the car dealership a flat fee to install its telematics device in each vehicle.  The Company recognizes revenue when all the devices have been installed.  At the end of each month, the Company will charge the dealership a fee based on the average number of cars on the dealer’s lot during the month and revenue is recognized at that time (end of the month).

The Company will account for its revenue per the guidance in ASC 605-25-25 by allocating the total contract amount between the product and service elements.  When a vehicle is sold to the driving consumer who purchases the ServiceWatch service, the cost of the service is added to the price of the car and the amount collected by the dealership for this service is remitted to the Company.  At the time of the vehicle is purchased, the Company recognizes revenue for the retail value of the telematics device that has been installed in the vehicle and the remaining amount is recognized over the service period of generally 24 to 36 months.

The Company also derives revenue from the sale of circuit boards and wire harnesses and recognizes revenue either FOB Origin or FOB Destination dependent upon the contract with the customer.

We consider revenue recognizable when persuasive evidence of an arrangement exists, the price is fixed or determinable, goods or services have been shipped or delivered, and collectability is reasonably assured. These criteria are assumed to have been met if a customer orders an item, the goods or services have been shipped or delivered to the customer, and we have sufficient evidence of collectability, such a payment history with the customer.  Our records for all periods presented have been sufficient to satisfy all of the four requirements.

Leases

Leases are reviewed by management and examined to see if they are required to be categorized as an operating lease, a capital lease or a financing transaction.

Earnings (loss) per share

Basic earnings (loss) per common share is computed by dividing net income (loss) available to common shareholders by the weighted-average number of shares of common stock outstanding during the period. Diluted earnings per common share is computed by dividing income available to common shareholders by the weighted-average number of shares of common stock outstanding during the period increased to include the number of additional shares of common stock that would have been outstanding if potentially dilutive securities had been issued. The only potentially dilutive securities outstanding during the periods presented were the convertible notes payable, but they are anti-dilutive due to the net loss incurred.

Stock-based compensation

The Company accounts for equity instruments issued in exchange for the receipt of goods or services from other than employees in accordance with Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) 718-10, Compensation – Stock Compensation, and the conclusions reached by FASB ASC 505-50, Equity – Equity-Based Payments to Non-Employees. Costs are measured at the estimated fair market value of the consideration received or the estimated fair value of the equity instruments issued, whichever is more reliably measurable. The value of equity instruments issued for consideration other than employee services is determined on the earliest of a performance commitment is reached or completion of performance by the provider of goods or services as defined by FASB ASC 505-50.

Income taxes

The Company records income taxes under the asset and liability method, whereby deferred tax assets and liabilities are recognized based on the future tax consequences attributable to temporary differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases, and attributable to operating loss and tax credit carry forwards. Accounting standards regarding income taxes requires a reduction of the carrying amounts of deferred tax assets by a valuation allowance, if based on the available evidence, it is more likely than not that such assets will not be realized. Accordingly, the need to establish valuation allowances for deferred tax assets is assessed at each reporting period based on a more-likely-than-not realization threshold. This assessment considers, among other matters, the nature, frequency and severity of current and cumulative losses, forecasts of future profitability, the duration of statutory carry forward periods, the Company’s experience with operating loss and tax credit carry forwards not expiring unused, and tax planning alternatives.

The Company recorded valuation allowances on the net deferred tax assets.  Management will reassess the realization of deferred tax assets based on the accounting standards for income taxes each reporting period. To the extent that the financial results of operations improve and it becomes more likely than not that the deferred tax assets are realizable, the Company will be able to reduce the valuation allowance.

Significant judgment is required in evaluating the Company’s tax positions and determining its provision for income taxes. During the ordinary course of business, there are many transactions and calculations for which the ultimate tax determination is uncertain. Accounting standards regarding uncertainty in income taxes provides a two-step approach to recognizing and measuring uncertain tax positions. The first step is to evaluate the tax position for recognition by determining if the weight of available evidence indicates it is more likely than not that the position will be sustained on audit, including resolution of related appeals or litigation processes, if any. The second step is to measure the tax benefit as the largest amount which is more than 50% likely, based solely on the technical merits, of being sustained on examinations. The Company considers many factors when evaluating and estimating its tax positions and tax benefits, which may require periodic adjustments and which may not accurately anticipate actual outcomes.

Embedded Conversion Features

The Company evaluates embedded conversion features within convertible debt under ASC 815 “Derivatives and Hedging” to determine whether the embedded conversion feature(s) should be bifurcated from the host instrument and accounted for as a derivative at fair value with changes in fair value recorded in earnings.  If the conversion feature does not require derivative treatment under ASC 815, the instrument is evaluated under ASC 470-20 “Debt with Conversion and Other Options” for consideration of any beneficial conversion features.

Related Party Disclosure

FASB ASC 850, "Related Party Disclosures" requires companies to include in their financial statements disclosures of material related party transactions. The Company discloses all material related party transactions. Related parties are defined to include any principal owner, director or executive officer of the Company and any immediate family members of a principal owner, director or executive officer.

Recent Accounting Pronouncements

In May 2014, the FASB issued Accounting Standards Update (“ASU”) No. 2014-09 (ASU 2014-09), Revenue from Contracts with Customers. ASU 2014-09 will eliminate transaction- and industry-specific revenue recognition guidance under current US GAAP and replace it with a principle based approach for determining revenue recognition. ASU 2014-09 will require that companies recognize revenue based on the value of transferred goods or services as they occur in the contract. The ASU also will require additional disclosure about the nature, amount, timing and uncertainty of revenue and cash flows arising from customer contracts, including significant judgments and changes in judgments and assets recognized from costs incurred to obtain or fulfill a contract. ASU 2014-09 is effective for reporting periods beginning after December 15, 2016, and early adoption is not permitted. Entities can transition to the standard either retrospectively or as a cumulative-effect adjustment as of the date of adoption. Management is currently assessing the impact the adoption of ASU 2014-09 and has not determined the effect of the standard on our ongoing financial reporting.

In August 2015, the FASB issued ASU No. 2015-14, Revenue from Contracts with Customers (Topic 606): Deferral of the Effective Date. The amendment in this ASU defers the effective date of ASU No. 2014-09 for all entities for one year. Public business entities, certain not-for-profit entities, and certain employee benefit plans should apply the guidance in ASU 2014-09 to annual reporting periods beginning December 15, 2017, including interim reporting periods within that reporting period. Earlier application is permitted only as of annual reporting periods beginning after December 15, 2016, including interim reporting periods with that reporting period.

In February 2015, the FASB issued ASU No. 2015-02, Consolidation (Topic 810): Amendments to the Consolidation Analysis. ASU 2015-02 provides guidance on the consolidation evaluation for reporting organizations that are required to evaluate whether they should consolidate certain legal entities such as limited partnerships, limited liability corporations, and securitization structures (collateralized debt obligations, collateralized loan obligations, and mortgage-backed security transactions). ASU 2015-02 is effective for periods beginning after December 15, 2015. The adoption of ASU 2015-02 is not expected to have a material effect on the Company’s financial statements. Early adoption is permitted.

In September, 2015, the FASB issued ASU No. 2015-16, Business Combinations (Topic 805).  Topic 805 requires that an acquirer retrospectively adjust provisional amounts recognized in a business combination, during the measurement period. To simplify the accounting for adjustments made to provisional amounts, the amendments in the Update require that the acquirer recognize adjustments to provisional amounts that are identified during the measurement period in the reporting period in which the adjustment amount is determined. The acquirer is required to also record, in the same period’s financial statements, the effect on earnings of changes in depreciation, amortization, or other income effects, if any, as a result of the change to the provisional amounts, calculated as if the accounting had been completed at the acquisition date.  In addition, an entity is required to present separately on the face of the income statement or disclose in the notes to the financial statements the portion of the amount recorded in current-period earnings by line item that would have been recorded in previous reporting periods if the adjustment to the provisional amounts had been recognized as of the acquisition date.  The adoption of ASU 2015-016 is not expected to have a material effect on the Company’s financial statements.

In November 2015, the FASB issued ASU No. 2015-17, Balance Sheet Classification of Deferred Taxes. The new guidance requires that all deferred tax assets and liabilities, along with any related valuation allowance, be classified as noncurrent on the balance sheet. This update is effective for annual periods beginning after December 15, 2016 and interim periods within those annual periods. The Company does not anticipate the adoption of this ASU will have a significant impact on its financial position, results of operations, or cash flows.

In February 2016, the FASB issued ASU No. 2016-02, Leases (Topic 842). The guidance in ASU No. 2016-02 supersedes the lease recognition requirements in ASC Topic 840, Leases (FAS 13). ASU 2016-02 requires an entity to recognize assets and liabilities arising from a lease for both financing and operating leases, along with additional qualitative and quantitative disclosures. ASU 2016-02 is effective for fiscal years beginning after December 15, 2018, with early adoption permitted. The Company is currently evaluating the effect this standard will have on its financial statements.

Other recent accounting pronouncements issued by the FASB, including its Emerging Issues Task Force, the American Institute of Certified Public Accountants, and the Securities and Exchange Commission did not or are not believed by management to have a material impact on the Company's present or future financial statements.

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Note 3 - Going Concern

9 Months Ended

Sep. 30, 2016

Notes

Note 3 - Going Concern

Note 3 – Going Concern

The accompanying financial statements have been prepared on a going concern basis, which contemplates the realization of assets and the satisfaction of liabilities in the normal course of business. The Company has incurred losses since inception.  The Company requires capital for its contemplated operational and marketing activities.  The Company’s ability to raise additional capital through the future issuances of common stock is unknown. The obtainment of additional financing, the successful development of the Company’s contemplated plan of operations, and its transition, ultimately, to the attainment of profitable operations are necessary for the Company to continue operations. The ability to successfully resolve these factors raise some doubt about the Company’s ability to continue as a going concern. The financial statements of the Company do not include any adjustments that may result from the outcome of these aforementioned uncertainties.

In order to mitigate the risk related with this uncertainty, the Company has a three-fold plan to resolve these risks.  First the acquisition of QCA has allowed for an increased level of cash flow to the Company as demonstrated in the sales for Q2 and Q3.  Second, the Company is close to acquiring another company that, like QCA, will increase income and cash flow to the Company.  Third, the Company plans to issue additional shares of common stock for cash and services during the next 12 months and has engaged MCAP, LLC to provide advisory services to that capital raise.

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Note 4 - Leases

9 Months Ended

Sep. 30, 2016

Notes

Note 4 - Leases

Note 4 – Leases

During the nine months ending September 30, 2016 (Successor) the Company entered into a financing transaction for a building.  The Company bought ($3,895,000) and sold ($7,000,000) the property to an unrelated third-party real estate company and simultaneously entered into an arrangement with the third-party real estate company to lease back the property.  Since the leaseback was not a normal leaseback this transaction is recorded as a financing transaction with the asset and related financing obligation recorded on the balance sheet.  The lease has a 15-year term expiring in 2031 and certain default provisions requiring the Company to perform repairs and maintenance, make timely rent payments and insure the building.  The Company also issued a letter of credit for $525,270 in favor of the landlord; the letter of credit is collateralized by a savings account which is classified as restricted cash under non-current assets.  The liability under the financing transaction as of September 30, 2016 (Successor) totals $9,855,790.  Imputed interest of $3,302,003 is being amortized over the lease term.  The Company paid costs of $54,898 and a commission of $350,000 in conjunction with the transaction, which is characterized as debt issuance costs and will be amortized over the lease term.  The current unamortized balance of the debt issuance costs is $349,028 and in accordance with ASU 2015-03 debt issuance costs are reflected as a contra-liability reducing the related financing lease obligation.

As of September 30, 2016 (Successor) the future minimum capital lease and financing transaction payments, net of amortization of debt issuance costs, are as follows:

Fiscal Year
2016	$	140,999
2017		571,499
2018		584,763
2019		599,382
2020		614,366
Thereafter		7,344,781
Total		9,855,790
Less: Current leases financing obligation		(13,562)
Less: imputed interest		(3,302,003)
Noncurrent leases financing obligation	$	6,540,225

The Company also has a commitment to pay $276,000 towards Leasehold Improvements of which $138,000 has been satisfied and reflected on the balance sheet as of September 30, 2016 (Successor).

The money received from the sale of the building was used to purchase Quality Circuit Assembly.  Since this is a financing transaction the sale is recorded under financing obligation lease on the Balance Sheet and amortized over the 15-year term of the lease.

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Note 5 - Notes Payable

9 Months Ended

Sep. 30, 2016

Notes

Note 5 - Notes Payable

Note 5 – Notes Payable

During the nine months ended September 30, 2016 (Successor) the Company secured a line of credit with a third-party lender, of which $327,500 was received in Q1.  The line of credit is collateralized by QCA’s outstanding accounts receivable, up to 80%, and inventory with maximum draws of $2,000,000 and $125,000, respectively, and a variable interest rate.  The Company also secured a five-year variable interest rate term loan with Celtic which is collateralized by QCA’s equipment.  As of September 30, 2016 (Successor) the outstanding balances for the loans are as follows:

		September 30, 2016 (Successor)
Line of credit current	$	713,265
Inventory current		96,000
Equipment current		34,777
Total Current	$	844,042
Equipment noncurrent		148,823
Total Notes	$	992,865

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Note 6 - Notes Payable, Related Parties

9 Months Ended

Sep. 30, 2016

Notes

Note 6 - Notes Payable, Related Parties

Note 6 – Notes Payable, Related Parties

At September 30, 2016 (Successor), and December 31, 2015 (Predecessor), notes payable consisted of the following:

		September 30,		December 31,
		2016 (Successor)		2015 (Predecessor)
Note payable; non-interest bearing; due upon demand; unsecured		0		10,000
Note payable; non-interest bearing; due upon demand; unsecured		15,000		0
Note payable; non-interest bearing; due upon demand; unsecured		15,000		0
	$	30,000	$	10,000

During the three months ended September 30, 2016 (Successor) a note with a related party was amended with a conversion option (see Note 7 for convertible notes description).  The amendment resulted in extinguishment of the original note because a conversion feature was added.  Management has evaluated the conversion option for derivative accounting consideration under ASC Topic 815-40, Derivatives and Hedging – Contracts in Entity's Own Stock and concluded that the conversion option meets the criteria for classification in stockholders' equity. Therefore, derivative accounting is not applicable for the conversion option.  Management also evaluated the conversion feature for whether it was beneficial as described in ASC Topic 470-30 and concluded it was beneficial because the conversion price at commitment date was less than the fair value of the Company's common stock.  The note converted during the three months ended September 30, 2016 (Successor) and thus the BCF discount was expensed to interest expense in its entirety.

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Note 7 - Convertible Notes Payable

9 Months Ended

Sep. 30, 2016

Notes

Note 7 - Convertible Notes Payable

Note 7 – Convertible Notes Payable

During the nine months ended September 30, 2016 (Successor) and year ended December 31, 2015 (Predecessor), the Company entered into convertible note agreements with investors.  The convertible notes are unsecured; bear interest at 5-20% annually, and are due from April 27, 2016, to July 1, 2019.  All of the convertible notes payable contain a provision that allows the note holder to convert the outstanding balance into shares of the Company's common stock.  Notes are convertible at $1.00 per share, except for those issued for a business acquisition, which are convertible at $10.00 per share.  The debt discount, which arises from a beneficial conversion feature (“BCF”) on the $1 per share investor notes, is being amortized over the terms of the convertible notes payable.  Total BCF discount is $113,810 for the six months ended September 30, 2016 (Successor).  For the three months ended September 30, 2016 (Successor), the Company recognized interest expense of $139,748 related to the amortization of the debt discount.  Company has evaluated Embedded Conversion Feature for convertible notes and BCF discount has a balance of $49,319 at September 30, 2016.

Convertible notes payable at September 30, 2016 (Successor) and December 31, 2015 (Predecessor), consisted of the following:

		Sep 30, 2016 (Successor)		Dec 31, 2015 (Predecessor)
Convertible Note - current	$	410,776	$	-
Debt discount		(49,319)		-
Net current	$	361,457	$	-
Convertible Note - noncurrent		1,801,551		-
Total Convertible Note	$	2,163,008	$	-

See Note 9 “Business Combination” for details on $2,000,000 convertible note.

A roll forward of the convertible notes payable is provided below:

Balance outstanding, April 1, 2016 (Successor)	$	131,928
Issuance of convertible notes payable for acquisition		2,000,000
Issuance of convertible notes payable for cash		12,500
Notes paid		(43,323)
Conversion of notes payable to common stock		(51,200)
Discount from beneficial conversion feature		(113,810)
Amortization of debt discount		226,913
Balance outstanding, September 30, 2016 (Successor)	$	2,163,008

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Note 8 - Stockholders' Equity

9 Months Ended

Sep. 30, 2016

Notes

Note 8 - Stockholders' Equity

Note 8 – Stockholders’ Equity

Preferred Stock

The Company is authorized to issue 5,000,000 shares of $.0001 par value preferred stock. As of November 11, 2016, no shares of preferred stock were outstanding.

Common Stock

Pursuant to the Second Amended and Restated Certificate of Incorporation, the Company is authorized to issue two classes of common stock: Class A common stock, which will have one vote per share, and Class B common stock, which will have ten votes per share. Any holder of Class B common stock may convert his or her shares at any time into shares of Class A common stock on a share-for-share basis. Otherwise the rights of the two classes of common stock will be identical.

The Company had the following transactions in its common stock during the six months ended September 30, 2016:

·         issued 200,548 (157,000 to related parties) shares of its Class A common stock for services, of the related party shares 107,000 are fully vested with 50,000 vesting from April 18, 2016 to April 18, 2017.  Unrecognized compensation for the unvested share is $212,500 which will be recognized over the vesting period;

·         issued 159,830 (101,310 to a related party on conversion of principal of $92,100 and accrued interest of $9,210) shares of its Class A common stock in connection with the conversion of convertible notes payable and accrued interest;

·         issued 670 shares of the Company’s restricted Class A common stock in private placement transactions to investors, in exchange for capital raised of $6,000.

There were no equity transactions related to the Predecessor Company during any Predecessor period presented.

Reverse Stock Split

On July 29, 2016 the Company adopted a resolution approved by the shareholders to issue a reverse stock split at a ratio of one (1) new share for each ten (10) old shares of the Company’s commons stock (the “Reverse Split”).  By its terms, the Reverse Split would only reduce the number of outstanding shares of Class A and Class B common stock, and would not correspondingly reduce the number of Class A and Class B common shares authorized for issuance, which remained at 500,000,000 and 100,000,000, respectively.

The financial statements have been retrospectively restated to reflect the reverse split.

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Note 9 - Business Combination

9 Months Ended

Sep. 30, 2016

Notes

Note 9 - Business Combination

Note 9 – Business Combination

Effective April 1, 2016 the Company Purchased 100% of the stock of Quality Circuit Assembly, Inc., a California company ("QCA").

The purchase price paid by the Company for the QCA Shares consists of cash, and a convertible promissory note.   The “Cash Consideration” paid was the aggregate amount of $3,000,000.  The “Promissory Note Consideration” consists of a secured promissory note (the “Quality Circuit Assembly Note”) in the amount of $2,000,000 ($160,126 current, $1,801,551 noncurrent), secured by a subordinated security interest in the assets of QCA.  Additionally, the Sellers have the opportunity to convert the Quality Circuit Assembly Note into shares of the Company’s Class A common stock at a conversion price of $10 per share after 12 months.  The Quality Circuit Assembly Note will bear interest at 5% with first payment due July 1, 2016, and will be payable in full in 36-months (namely, July 1, 2019).

A summary of the preliminary purchase price allocation at fair value is below.

	Purchase Allocation
Cash	$                             200,000
Accounts Receivable	1,044,375
Inventory	950,424
Property, Plant & Equipment	1,256,885
Prepaid	53,535
Intangibles	150,000
Goodwill	2,491,945
Accounts Payable	(672,410)
Accrued Expenses	(128,444)
Deferred Tax Liability	(346,310)
	$                             5,000,000

Preliminary purchase price allocation is pending finalization of tax effect on intangibles.  During three months ended September 30, 2016 (Predecessor) an adjustment was made to the purchase price allocation based on additional information.  Accounts receivable decreased by $51,044, Inventory increased by $19,641, Accounts Payable increased by $19,782 and Goodwill increased by $51,185.

Unaudited pro forma result of operations for the three months ended March 31, 2016 and the three and nine months ended September 30, 2015 as if the Companies had been combined as of January 1, 2015, follow.  The pro forma results include estimates and assumptions which management believes are reasonable.  However, pro forma results do not include any anticipated cost savings or other effects of the planned integration of these entities, and are not necessarily indicative of the results that would have occurred if the business combination had been in effect on the dates indicated or which may result in the future.  For periods ending June 30, 2016 and September 30, 2016 pro forma information is not provided because the results after March 31, 2016 are post-acquisition.

		Pro Forma Combined Financials
		Three Months Ended March 31, 2016		Three Months Ended September 30, 2015		Nine Months Ended September 30, 2015
Revenue	$	1,795,769	$	1,827,630	$	5,974,220
Net (Loss) Income	$	(330,933)	$	(2,371,293)	$	(11,036,240)
Net (Loss) Income per Common Share - Basic and Diluted	$	(0.02)	$	(0.35)	$	(1.39)

For the three months and six months ending September 30, 2016 QCA has contributed $2,244,498 and $4,213,114 of revenue, respectively and $106,555 and $147,337 of net income, respectively.

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Note 10 - Subsequent Events

9 Months Ended

Sep. 30, 2016

Notes

Note 10 - Subsequent Events

Note 10 – Subsequent Events

None

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Note 2 - Summary of Significant Accounting Policies: Principles of Consolidation (Policies)

9 Months Ended

Sep. 30, 2016

Policies

Principles of Consolidation

Principles of consolidation

The consolidated financial statements include the accounts of the Company and its wholly-owned subsidiaries as of September 30, 2016 (Successor) and December 31, 2015 (Predecessor).  Significant intercompany balances and transactions have been eliminated.

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Note 2 - Summary of Significant Accounting Policies: Basis of Presentation (Policies)

9 Months Ended

Sep. 30, 2016

Policies

Basis of Presentation

Basis of presentation

The accompanying financial statements present the balance sheets, statements of operations, stockholders’ deficit and cash flows of the Company. The financial statements have been prepared in accordance with U.S. GAAP.

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Note 2 - Summary of Significant Accounting Policies: Use of Estimates, Policy (Policies)

9 Months Ended

Sep. 30, 2016

Policies

Use of Estimates, Policy

Use of estimates

The preparation of financial statements in conformity with U.S. GAAP requires the Company to make estimates and judgments that affect the reported amounts of assets and liabilities, revenues and expenses, and related disclosures of contingent assets and liabilities.  These estimates and judgments are based on historical information, information that is currently available to the Company and on various other assumptions that the Company believes to be reasonable under the circumstances.  Actual results could differ from those estimates.

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Note 2 - Summary of Significant Accounting Policies: Cash, Policy (Policies)

9 Months Ended

Sep. 30, 2016

Policies

Cash, Policy

Cash

Cash and cash equivalents consist of cash and short-term investments with original maturities of less than 90 days.  Cash equivalents are placed with high credit quality financial institutions and are primarily in money market funds.  The carrying value of those investments approximates fair value.

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Note 2 - Summary of Significant Accounting Policies: Major Customers (Policies)

9 Months Ended

Sep. 30, 2016

Policies

Major Customers

Major Customers

For all periods presented the Company had two customers that made up approximately 50% of total revenues.  All other customers were less than 10% each of total revenues in each period.

For all periods presented the Company had two customers that made up approximately 50% of outstanding accounts receivable.  All other customers were less than 10% each of total accounts receivable for each period presented.

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Note 2 - Summary of Significant Accounting Policies: Accounts Receivable (Policies)

9 Months Ended

Sep. 30, 2016

Policies

Accounts Receivable

Accounts Receivable

The Company maintains reserves for potential credit losses on accounts receivable. Management reviews the composition of accounts receivable and analyzes historical bad debts, customer concentrations, customer credit worthiness, current economic trends and changes in customer payment patterns to evaluate the adequacy of these reserves. Reserves are recorded primarily on a specific identification basis.

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Note 2 - Summary of Significant Accounting Policies: Inventory (Policies)

9 Months Ended

Sep. 30, 2016

Policies

Inventory

Inventory

Inventory is valued at the lower of the inventory’s cost (weighted average basis) or market. Management compares the cost of inventory with its market value and an allowance is made to write down inventory to market value, if lower.  Inventory is segregated into four areas, raw materials, WIP, finished goods, and In-Transit.  Below is a breakdown of how much inventory is in each area as of September 30, 2016 (Successor) and December 31, 2015 (Predecessor).

	Sep 30, 2016 (Successor)	December 31, 2015 (Predecessor)
Raw materials	$         421,970	$                 391,845
WIP	246,226	351,697
Finished goods	312,865	192,820
In Transit	13,000	13,000
	$         994,061	$                 949,362

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Note 2 - Summary of Significant Accounting Policies: Property and Equipment (Policies)

9 Months Ended

Sep. 30, 2016

Policies

Property and Equipment

Property and Equipment

Property and equipment are carried at cost less depreciation. Depreciation and amortization are provided principally on the straight-line method over the estimated useful lives of the assets, which range from five years to 39 years as follows:

Buildings                                                               39 years

Equipment                                                            5 years

Maintenance and repair costs are charged against income as incurred.  Significant improvements or betterments are capitalized and depreciated over the estimated life of the asset.

Below is a table of Property and Equipment

Property and Equipment
		Sep 30, 2016 (Successor)		Dec 31, 2015 (Predecessor)
Machinery & Equipment	$	1,256,885	$	1,191,843
Office furniture & fixtures		-		164,868
Building		3,895,000		-
Less: Accumulated Depreciation		(175,624)		(1,190,448)
	$	4,976,261	$	166,263

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Note 2 - Summary of Significant Accounting Policies: Purchased Intangibles and Other Long-lived Assets (Policies)

9 Months Ended

Sep. 30, 2016

Policies

Purchased Intangibles and Other Long-lived Assets

Purchased Intangibles and Other Long-Lived Assets

The Company amortizes intangible assets with finite lives over their estimated useful lives, which range between five and fifteen years as follows:

Leasehold Improvements                                  15 years

Non-compete agreements                                  5 years

Software development                                       5 years

Below are tables for Intangibles and Other Long-Lived Assets

Intangibles
		Sep 30, 2016 (Successor)			Dec 31, 2015 (Predecessor)
Leasehold Improvements	$	140,200	$		-
Software		179,300			-
Noncompete		100,000			-
Other		50,000			-
Less: Accumulated Amortization		(30,067)		-
	$	439,433	$		-

Other Intangibles consist of QCA’s trade name, long lived customer relationships and customer lists.

Other Non-Current Assets
		Sep 30, 2016 (Successor)		Dec 31, 2015 (Predecessor)
Restricted Cash	$	525,270	$	-
Deposits		54,366		-
	$	579,636	$	-

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Note 2 - Summary of Significant Accounting Policies: Impairment of Long-lived Assets (Policies)

9 Months Ended

Sep. 30, 2016

Policies

Impairment of Long-lived Assets

Impairment of Long-Lived Assets

The Company accounts for long-lived assets in accordance with the provisions of FASB Topic 360, “Accounting for the Impairment of Long-Lived Assets”.  This statement requires that long-lived assets and certain identifiable intangibles be reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable.  An impairment loss would be recognized when the estimated future cash flows from the use of the asset are less than the carrying amount of that asset.  During the three and six months ended September 30, 2016 (Successor), the period from January 1, 2016 through March 31, 2016 (Predecessor) and the nine months ended September 30, 2015 (Predecessor), there have been no impairment losses.

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Note 2 - Summary of Significant Accounting Policies: Goodwill (Policies)

9 Months Ended

Sep. 30, 2016

Policies

Goodwill

Goodwill

In financial reporting goodwill is not amortized, but is tested for impairment annually in the fourth quarter of the fiscal year or whenever events or changes in circumstances indicate that the carrying amount may not be recoverable.  Events that result in an impairment review include significant changes in the business climate, declines in our operating results, or an expectation that the carrying amount may not be recoverable.  We assess potential impairment by considering present economic conditions as well as future expectations.

We review goodwill for impairment by performing a two-step goodwill impairment test.  The first step of the two-step goodwill impairment test is to compare the fair value of the reporting unit to its carrying amount, including goodwill.  If the carrying amount of the reporting unit exceeds its fair value, the second step of the two-step goodwill impairment test is required to measure the goodwill impairment loss.

The second step includes valuing all the tangible and intangible assets of the reporting unit as if the reporting unit had been acquired in a business combination.  Then, the implied fair value of the reporting unit’s goodwill is compared to the carrying amount of that goodwill.  If the carrying amount of the reporting unit’s goodwill exceeds the implied fair value of the goodwill, we recognize an impairment loss in an amount equal to the excess, not to exceed the carrying amount.

The Company has recorded no impairment of goodwill in any period presented.

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Note 2 - Summary of Significant Accounting Policies: Fair Value Measurement (Policies)

9 Months Ended

Sep. 30, 2016

Policies

Fair Value Measurement

Fair Value Measurement

The Company’s financial instruments consist of cash and cash equivalents, accounts receivable, accounts payable, accrued expenses, convertible notes, notes and line of credit.  The carrying amount of these financial instruments approximates fair value due either to length of maturity or interest rates that approximate prevailing market rates unless otherwise disclosed in these financial statements.

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Note 2 - Summary of Significant Accounting Policies: Revenue Recognition (Policies)

9 Months Ended

Sep. 30, 2016

Policies

Revenue Recognition

Revenue Recognition

The Company has a portfolio of consumer and professional software applications called 6thSenseAuto, which consists primarily of the Company's two products previously branded as LotWatch and ServiceWatch .

LotWatch is a product for dealerships to give them vehicle inventory information. Our telematics devices use information gathered from the OBD (On Board Diagnostics) port, and by utilizing both GPS technology and cellular based service, the LotWatch module provides specific, real-time, accurate information about a dealership's fleet of new vehicles. This information can be easily accessed and viewed on Alpine 4's interface anywhere the dealership have internet access.

ServiceWatch is a product for the driving consumer that also uses information gathered from the OBD port.  By utilizing both GPS technology and cellular based service, the ServiceWatch module provides vehicle specific real-time, accurate information to a dealership's service department to increase sales all while improving their level of service.

When the Company enters into an agreement with a car dealership that wants to utilize its LotWatch service, a telematics device must be installed in each vehicle.  The Company will generally charge the car dealership a flat fee to install its telematics device in each vehicle.  The Company recognizes revenue when all the devices have been installed.  At the end of each month, the Company will charge the dealership a fee based on the average number of cars on the dealer’s lot during the month and revenue is recognized at that time (end of the month).

The Company will account for its revenue per the guidance in ASC 605-25-25 by allocating the total contract amount between the product and service elements.  When a vehicle is sold to the driving consumer who purchases the ServiceWatch service, the cost of the service is added to the price of the car and the amount collected by the dealership for this service is remitted to the Company.  At the time of the vehicle is purchased, the Company recognizes revenue for the retail value of the telematics device that has been installed in the vehicle and the remaining amount is recognized over the service period of generally 24 to 36 months.

The Company also derives revenue from the sale of circuit boards and wire harnesses and recognizes revenue either FOB Origin or FOB Destination dependent upon the contract with the customer.

We consider revenue recognizable when persuasive evidence of an arrangement exists, the price is fixed or determinable, goods or services have been shipped or delivered, and collectability is reasonably assured. These criteria are assumed to have been met if a customer orders an item, the goods or services have been shipped or delivered to the customer, and we have sufficient evidence of collectability, such a payment history with the customer.  Our records for all periods presented have been sufficient to satisfy all of the four requirements.

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Note 2 - Summary of Significant Accounting Policies: Leases (Policies)

9 Months Ended

Sep. 30, 2016

Policies

Leases

Leases

Leases are reviewed by management and examined to see if they are required to be categorized as an operating lease, a capital lease or a financing transaction.

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Note 2 - Summary of Significant Accounting Policies: Earnings Per Share Policy, Basic (Policies)

9 Months Ended

Sep. 30, 2016

Policies

Earnings Per Share Policy, Basic

Earnings (loss) per share

Basic earnings (loss) per common share is computed by dividing net income (loss) available to common shareholders by the weighted-average number of shares of common stock outstanding during the period. Diluted earnings per common share is computed by dividing income available to common shareholders by the weighted-average number of shares of common stock outstanding during the period increased to include the number of additional shares of common stock that would have been outstanding if potentially dilutive securities had been issued. The only potentially dilutive securities outstanding during the periods presented were the convertible notes payable, but they are anti-dilutive due to the net loss incurred.

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Note 2 - Summary of Significant Accounting Policies: Share-based Compensation, Option and Incentive Plans Policy (Policies)

9 Months Ended

Sep. 30, 2016

Policies

Share-based Compensation, Option and Incentive Plans Policy

Stock-based compensation

The Company accounts for equity instruments issued in exchange for the receipt of goods or services from other than employees in accordance with Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) 718-10, Compensation – Stock Compensation, and the conclusions reached by FASB ASC 505-50, Equity – Equity-Based Payments to Non-Employees. Costs are measured at the estimated fair market value of the consideration received or the estimated fair value of the equity instruments issued, whichever is more reliably measurable. The value of equity instruments issued for consideration other than employee services is determined on the earliest of a performance commitment is reached or completion of performance by the provider of goods or services as defined by FASB ASC 505-50.

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Note 2 - Summary of Significant Accounting Policies: Income Tax, Policy (Policies)

9 Months Ended

Sep. 30, 2016

Policies

Income Tax, Policy

Income taxes

The Company records income taxes under the asset and liability method, whereby deferred tax assets and liabilities are recognized based on the future tax consequences attributable to temporary differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases, and attributable to operating loss and tax credit carry forwards. Accounting standards regarding income taxes requires a reduction of the carrying amounts of deferred tax assets by a valuation allowance, if based on the available evidence, it is more likely than not that such assets will not be realized. Accordingly, the need to establish valuation allowances for deferred tax assets is assessed at each reporting period based on a more-likely-than-not realization threshold. This assessment considers, among other matters, the nature, frequency and severity of current and cumulative losses, forecasts of future profitability, the duration of statutory carry forward periods, the Company’s experience with operating loss and tax credit carry forwards not expiring unused, and tax planning alternatives.

The Company recorded valuation allowances on the net deferred tax assets.  Management will reassess the realization of deferred tax assets based on the accounting standards for income taxes each reporting period. To the extent that the financial results of operations improve and it becomes more likely than not that the deferred tax assets are realizable, the Company will be able to reduce the valuation allowance.

Significant judgment is required in evaluating the Company’s tax positions and determining its provision for income taxes. During the ordinary course of business, there are many transactions and calculations for which the ultimate tax determination is uncertain. Accounting standards regarding uncertainty in income taxes provides a two-step approach to recognizing and measuring uncertain tax positions. The first step is to evaluate the tax position for recognition by determining if the weight of available evidence indicates it is more likely than not that the position will be sustained on audit, including resolution of related appeals or litigation processes, if any. The second step is to measure the tax benefit as the largest amount which is more than 50% likely, based solely on the technical merits, of being sustained on examinations. The Company considers many factors when evaluating and estimating its tax positions and tax benefits, which may require periodic adjustments and which may not accurately anticipate actual outcomes.

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Note 2 - Summary of Significant Accounting Policies: New Accounting Pronouncements, Policy (Policies)

9 Months Ended

Sep. 30, 2016

Policies

New Accounting Pronouncements, Policy

Recent Accounting Pronouncements

In May 2014, the FASB issued Accounting Standards Update (“ASU”) No. 2014-09 (ASU 2014-09), Revenue from Contracts with Customers. ASU 2014-09 will eliminate transaction- and industry-specific revenue recognition guidance under current US GAAP and replace it with a principle based approach for determining revenue recognition. ASU 2014-09 will require that companies recognize revenue based on the value of transferred goods or services as they occur in the contract. The ASU also will require additional disclosure about the nature, amount, timing and uncertainty of revenue and cash flows arising from customer contracts, including significant judgments and changes in judgments and assets recognized from costs incurred to obtain or fulfill a contract. ASU 2014-09 is effective for reporting periods beginning after December 15, 2016, and early adoption is not permitted. Entities can transition to the standard either retrospectively or as a cumulative-effect adjustment as of the date of adoption. Management is currently assessing the impact the adoption of ASU 2014-09 and has not determined the effect of the standard on our ongoing financial reporting.

In August 2015, the FASB issued ASU No. 2015-14, Revenue from Contracts with Customers (Topic 606): Deferral of the Effective Date. The amendment in this ASU defers the effective date of ASU No. 2014-09 for all entities for one year. Public business entities, certain not-for-profit entities, and certain employee benefit plans should apply the guidance in ASU 2014-09 to annual reporting periods beginning December 15, 2017, including interim reporting periods within that reporting period. Earlier application is permitted only as of annual reporting periods beginning after December 15, 2016, including interim reporting periods with that reporting period.

In February 2015, the FASB issued ASU No. 2015-02, Consolidation (Topic 810): Amendments to the Consolidation Analysis. ASU 2015-02 provides guidance on the consolidation evaluation for reporting organizations that are required to evaluate whether they should consolidate certain legal entities such as limited partnerships, limited liability corporations, and securitization structures (collateralized debt obligations, collateralized loan obligations, and mortgage-backed security transactions). ASU 2015-02 is effective for periods beginning after December 15, 2015. The adoption of ASU 2015-02 is not expected to have a material effect on the Company’s financial statements. Early adoption is permitted.

In September, 2015, the FASB issued ASU No. 2015-16, Business Combinations (Topic 805).  Topic 805 requires that an acquirer retrospectively adjust provisional amounts recognized in a business combination, during the measurement period. To simplify the accounting for adjustments made to provisional amounts, the amendments in the Update require that the acquirer recognize adjustments to provisional amounts that are identified during the measurement period in the reporting period in which the adjustment amount is determined. The acquirer is required to also record, in the same period’s financial statements, the effect on earnings of changes in depreciation, amortization, or other income effects, if any, as a result of the change to the provisional amounts, calculated as if the accounting had been completed at the acquisition date.  In addition, an entity is required to present separately on the face of the income statement or disclose in the notes to the financial statements the portion of the amount recorded in current-period earnings by line item that would have been recorded in previous reporting periods if the adjustment to the provisional amounts had been recognized as of the acquisition date.  The adoption of ASU 2015-016 is not expected to have a material effect on the Company’s financial statements.

In November 2015, the FASB issued ASU No. 2015-17, Balance Sheet Classification of Deferred Taxes. The new guidance requires that all deferred tax assets and liabilities, along with any related valuation allowance, be classified as noncurrent on the balance sheet. This update is effective for annual periods beginning after December 15, 2016 and interim periods within those annual periods. The Company does not anticipate the adoption of this ASU will have a significant impact on its financial position, results of operations, or cash flows.

In February 2016, the FASB issued ASU No. 2016-02, Leases (Topic 842). The guidance in ASU No. 2016-02 supersedes the lease recognition requirements in ASC Topic 840, Leases (FAS 13). ASU 2016-02 requires an entity to recognize assets and liabilities arising from a lease for both financing and operating leases, along with additional qualitative and quantitative disclosures. ASU 2016-02 is effective for fiscal years beginning after December 15, 2018, with early adoption permitted. The Company is currently evaluating the effect this standard will have on its financial statements.

Other recent accounting pronouncements issued by the FASB, including its Emerging Issues Task Force, the American Institute of Certified Public Accountants, and the Securities and Exchange Commission did not or are not believed by management to have a material impact on the Company's present or future financial statements.

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Note 2 - Summary of Significant Accounting Policies: Inventory: Schedule of Inventory, Current (Tables)

9 Months Ended

Sep. 30, 2016

Tables/Schedules

Schedule of Inventory, Current

	Sep 30, 2016 (Successor)	December 31, 2015 (Predecessor)
Raw materials	$         421,970	$                 391,845
WIP	246,226	351,697
Finished goods	312,865	192,820
In Transit	13,000	13,000
	$         994,061	$                 949,362

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Note 2 - Summary of Significant Accounting Policies: Property and Equipment: Property, Plant and Equipment (Tables)

9 Months Ended

Sep. 30, 2016

Tables/Schedules

Property, Plant and Equipment

Property and Equipment
		Sep 30, 2016 (Successor)		Dec 31, 2015 (Predecessor)
Machinery & Equipment	$	1,256,885	$	1,191,843
Office furniture & fixtures		-		164,868
Building		3,895,000		-
Less: Accumulated Depreciation		(175,624)		(1,190,448)
	$	4,976,261	$	166,263

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Note 2 - Summary of Significant Accounting Policies: Purchased Intangibles and Other Long-lived Assets: Schedule of Intangible Assets (Tables)

9 Months Ended

Sep. 30, 2016

Tables/Schedules

Schedule of Intangible Assets

Intangibles
		Sep 30, 2016 (Successor)			Dec 31, 2015 (Predecessor)
Leasehold Improvements	$	140,200	$		-
Software		179,300			-
Noncompete		100,000			-
Other		50,000			-
Less: Accumulated Amortization		(30,067)		-
	$	439,433	$		-

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Note 2 - Summary of Significant Accounting Policies: Purchased Intangibles and Other Long-lived Assets: Schedule of Other Assets, Noncurrent (Tables)

9 Months Ended

Sep. 30, 2016

Tables/Schedules

Schedule of Other Assets, Noncurrent

Other Non-Current Assets
		Sep 30, 2016 (Successor)		Dec 31, 2015 (Predecessor)
Restricted Cash	$	525,270	$	-
Deposits		54,366		-
	$	579,636	$	-

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Note 4 - Leases: Schedule of Future Minimum Lease Payments for Capital Leases (Tables)

9 Months Ended

Sep. 30, 2016

Tables/Schedules

Schedule of Future Minimum Lease Payments for Capital Leases

Fiscal Year
2016	$	140,999
2017		571,499
2018		584,763
2019		599,382
2020		614,366
Thereafter		7,344,781
Total		9,855,790
Less: Current leases financing obligation		(13,562)
Less: imputed interest		(3,302,003)
Noncurrent leases financing obligation	$	6,540,225

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Note 5 - Notes Payable: Schedule of Notes Payable (Tables)

9 Months Ended

Sep. 30, 2016

Tables/Schedules

Schedule of Notes Payable

		September 30, 2016 (Successor)
Line of credit current	$	713,265
Inventory current		96,000
Equipment current		34,777
Total Current	$	844,042
Equipment noncurrent		148,823
Total Notes	$	992,865

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Note 6 - Notes Payable, Related Parties: Schedule of Notes Payable, Related Parties (Tables)

9 Months Ended

Sep. 30, 2016

Tables/Schedules

Schedule of Notes Payable, Related Parties

		September 30,		December 31,
		2016 (Successor)		2015 (Predecessor)
Note payable; non-interest bearing; due upon demand; unsecured		0		10,000
Note payable; non-interest bearing; due upon demand; unsecured		15,000		0
Note payable; non-interest bearing; due upon demand; unsecured		15,000		0
	$	30,000	$	10,000

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Note 7 - Convertible Notes Payable: Schedule of Convertible Notes Payable (Tables)

9 Months Ended

Sep. 30, 2016

Tables/Schedules

Schedule of Convertible Notes Payable

		Sep 30, 2016 (Successor)		Dec 31, 2015 (Predecessor)
Convertible Note - current	$	410,776	$	-
Debt discount		(49,319)		-
Net current	$	361,457	$	-
Convertible Note - noncurrent		1,801,551		-
Total Convertible Note	$	2,163,008	$	-

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Note 7 - Convertible Notes Payable: Roll forward of the convertible notes payable (Tables)

9 Months Ended

Sep. 30, 2016

Tables/Schedules

Roll forward of the convertible notes payable

Balance outstanding, April 1, 2016 (Successor)	$	131,928
Issuance of convertible notes payable for acquisition		2,000,000
Issuance of convertible notes payable for cash		12,500
Notes paid		(43,323)
Conversion of notes payable to common stock		(51,200)
Discount from beneficial conversion feature		(113,810)
Amortization of debt discount		226,913
Balance outstanding, September 30, 2016 (Successor)	$	2,163,008

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Note 9 - Business Combination: Schedule of Finite-Lived Intangible Assets Acquired as Part of Business Combination (Tables)

9 Months Ended

Sep. 30, 2016

Tables/Schedules

Schedule of Finite-Lived Intangible Assets Acquired as Part of Business Combination

	Purchase Allocation
Cash	$                             200,000
Accounts Receivable	1,044,375
Inventory	950,424
Property, Plant & Equipment	1,256,885
Prepaid	53,535
Intangibles	150,000
Goodwill	2,491,945
Accounts Payable	(672,410)
Accrued Expenses	(128,444)
Deferred Tax Liability	(346,310)
	$                             5,000,000

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Note 9 - Business Combination: Business Acquisition, Pro Forma Information (Tables)

9 Months Ended

Sep. 30, 2016

Tables/Schedules

Business Acquisition, Pro Forma Information

		Pro Forma Combined Financials
		Three Months Ended March 31, 2016		Three Months Ended September 30, 2015		Nine Months Ended September 30, 2015
Revenue	$	1,795,769	$	1,827,630	$	5,974,220
Net (Loss) Income	$	(330,933)	$	(2,371,293)	$	(11,036,240)
Net (Loss) Income per Common Share - Basic and Diluted	$	(0.02)	$	(0.35)	$	(1.39)

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Note 2 - Summary of Significant Accounting Policies: Major Customers (Details)	9 Months Ended
	Sep. 30, 2016
Credit Concentration Risk
Concentration Risk, Customer	the Company had two customers that made up approximately 50% of total revenues. All other customers were less than 10% each of total revenues
Accounts Receivable Concentration Risk
Concentration Risk, Customer	the Company had two customers that made up approximately 50% of outstanding accounts receivable. All other customers were less than 10% each of total accounts receivable

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Note 2 - Summary of Significant Accounting Policies: Inventory: Schedule of Inventory, Current (Details) - USD ($)	Sep. 30, 2016	Dec. 31, 2015
Successor
Inventory, Raw Materials, Gross	$ 421,970
Inventory, Work in Process, Gross	246,226
Inventory, Finished Goods, Gross	312,865
Inventory, In Transit, Gross	13,000
Inventory	$ 994,061
Predecessor
Inventory, Raw Materials, Gross		$ 391,845
Inventory, Work in Process, Gross		351,697
Inventory, Finished Goods, Gross		192,820
Inventory, In Transit, Gross		13,000
Inventory		$ 949,362

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Note 2 - Summary of Significant Accounting Policies: Property and Equipment (Details)	9 Months Ended
	Sep. 30, 2016
Building
Property, Plant and Equipment, Useful Life	39 years
Equipment
Property, Plant and Equipment, Useful Life	5 years

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Note 2 - Summary of Significant Accounting Policies: Property and Equipment: Property, Plant and Equipment (Details) - USD ($)	Sep. 30, 2016	Dec. 31, 2015
Successor
Property and equipment, net	$ 4,976,261
Accumulated Depreciation, Depletion and Amortization, Property, Plant, and Equipment	(175,624)
Successor | Machinery and Equipment
Property and equipment, net	1,256,885
Successor | Building
Property and equipment, net	$ 3,895,000
Predecessor
Property and equipment, net		$ 166,263
Accumulated Depreciation, Depletion and Amortization, Property, Plant, and Equipment		(1,190,448)
Predecessor | Machinery and Equipment
Property and equipment, net		1,191,843
Predecessor | Furniture and Fixtures
Property and equipment, net		$ 164,868

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Note 2 - Summary of Significant Accounting Policies: Purchased Intangibles and Other Long-lived Assets (Details)	9 Months Ended
	Sep. 30, 2016
Noncompete Agreements
Finite-Lived Intangible Asset, Useful Life	5 years
Leaseholds and Leasehold Improvements
Finite-Lived Intangible Asset, Useful Life	15 years
Software Development
Finite-Lived Intangible Asset, Useful Life	5 years

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Note 2 - Summary of Significant Accounting Policies: Purchased Intangibles and Other Long-lived Assets: Schedule of Intangible Assets (Details) - Successor	Sep. 30, 2016 USD ($)
Intangible Assets, Gross (Excluding Goodwill)	$ 439,433
Finite-Lived Intangible Assets, Accumulated Amortization	(30,067)
Computer Software, Intangible Asset
Intangible Assets, Gross (Excluding Goodwill)	179,300
Noncompete Agreements
Intangible Assets, Gross (Excluding Goodwill)	100,000
Other Intangible Assets
Intangible Assets, Gross (Excluding Goodwill)	50,000
Leaseholds and Leasehold Improvements
Intangible Assets, Gross (Excluding Goodwill)	$ 140,200

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Note 2 - Summary of Significant Accounting Policies: Purchased Intangibles and Other Long-lived Assets: Schedule of Other Assets, Noncurrent (Details) - USD ($)	Sep. 30, 2016	Dec. 31, 2015
Successor
Other non-current assets	$ 579,636
Successor | Deposits
Other non-current assets	54,366
Successor | Restricted Cash
Other non-current assets	$ 525,270
Predecessor
Other non-current assets

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Note 4 - Leases: Schedule of Future Minimum Lease Payments for Capital Leases (Details)	Sep. 30, 2016 USD ($)
Details
Capital Leases, Future Minimum Payments Due, Next Twelve Months	$ 140,999
Capital Leases, Future Minimum Payments Due in Two Years	571,499
Capital Leases, Future Minimum Payments Due in Three Years	584,763
Capital Leases, Future Minimum Payments Due in Four Years	599,382
Capital Leases, Future Minimum Payments Due in Five Years	614,366
Capital Leases, Future Minimum Payments Due Thereafter	7,344,781
Capital Leases, Future Minimum Payments Due	9,855,790
Capital Lease: current	(13,562)
Imputed Interest on Capital Lease	(3,302,003)
Financing Obligation Lease: non-current	$ 6,540,225

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Note 5 - Notes Payable: Schedule of Notes Payable (Details) - Successor	Sep. 30, 2016 USD ($)
Notes payable	$ 844,042
Long-term debt	148,823
Notes payable	992,865
Line of Credit - Current
Notes payable	713,265
Inventory - current
Notes payable	96,000
Equipment - current
Notes payable	34,777
Equipment - noncurrent
Long-term debt	$ 148,823

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Note 6 - Notes Payable, Related Parties: Schedule of Notes Payable, Related Parties (Details) - USD ($)	Sep. 30, 2016	Dec. 31, 2015
Successor
Notes payable, related parties	$ 30,000
Successor | Notes Payable 1
Notes payable, related parties	0
Successor | Notes Payable 2
Notes payable, related parties	15,000
Successor | Notes Payable 3
Notes payable, related parties	$ 15,000
Predecessor
Notes payable, related parties		$ 10,000
Predecessor | Notes Payable 1
Notes payable, related parties		10,000
Predecessor | Notes Payable 2
Notes payable, related parties		0
Predecessor | Notes Payable 3
Notes payable, related parties		$ 0

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Note 7 - Convertible Notes Payable (Details)	3 Months Ended
	Sep. 30, 2016 USD ($)
Details
Amortization of debt discounts	$ 139,748
Debt Discount, Convertible Debt	$ 49,319

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Note 7 - Convertible Notes Payable: Schedule of Convertible Notes Payable (Details) - USD ($)	Sep. 30, 2016	Mar. 31, 2016	Dec. 31, 2015
Debt Discount, Convertible Debt	$ (49,319)
Successor
Long-term Debt, Gross	410,776
Debt Discount, Convertible Debt	(49,319)
Convertible notes payable, net of discount of $49,319 and $0	361,457
Convertible notes payable	1,801,551
Convertible notes payable	$ 2,163,008	$ 131,928
Predecessor
Convertible notes payable, net of discount of $49,319 and $0
Convertible notes payable

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Note 7 - Convertible Notes Payable: Roll forward of the convertible notes payable (Details) - USD ($)	3 Months Ended	6 Months Ended
	Sep. 30, 2016	Sep. 30, 2016	Mar. 31, 2016
Issuance of note payable for acquisition of QCA	$ 2,000,000
Amortization of debt discounts	139,748
Successor
Convertible notes payable	2,163,008	$ 2,163,008	$ 131,928
Issuance of note payable for acquisition of QCA	2,000,000	2,000,000
Proceeds from convertible notes payable	12,500	12,500
Notes paid	(43,323)
Common stock issued for convertible note payable	(51,200)
Debt discount from convertible note payable	(113,810)	113,810
Amortization of debt discounts		$ 226,913
Successor | Convertible Notes Payable
Amortization of debt discounts	$ 226,913

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Note 8 - Stockholders' Equity (Details) - USD ($)	3 Months Ended	9 Months Ended
	Sep. 30, 2016	Sep. 30, 2016	Dec. 31, 2015
Preferred stock shares authorized	5,000,000	5,000,000	5,000,000
Preferred stock par value	$ 0.0001	$ 0.0001	$ 0.0001
Stockholders' Equity, Reverse Stock Split		On July 29, 2016 the Company adopted a resolution approved by the shareholders to issue a reverse stock split at a ratio of one (1) new share for each ten (10) old shares of the Company’s commons stock (the “Reverse Split”). By its terms, the Reverse Split would only reduce the number of outstanding shares of Class A and Class B common stock, and would not correspondingly reduce the number of Class A and Class B common shares authorized for issuance, which remained at 500,000,000 and 100,000,000, respectively.
Stock Issuance 1
Stock Issued During Period, Shares, New Issues	200,548
Stock Issuance 2
Stock Issued During Period, Shares, New Issues	159,830
Stock Issuance 3
Stock Issued During Period, Shares, New Issues	670
Proceeds from the sale of common stock	$ 6,000

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Note 9 - Business Combination (Details)	3 Months Ended
	Sep. 30, 2016 USD ($)
Details
Issuance of note payable for acquisition of QCA	$ 2,000,000

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Note 9 - Business Combination: Schedule of Finite-Lived Intangible Assets Acquired as Part of Business Combination (Details)	9 Months Ended
	Sep. 30, 2016 USD ($)
Business Combination, Step Acquisition, Equity Interest in Acquiree, Fair Value	$ 5,000,000
Business Acquisition, Cash
Business Combination, Step Acquisition, Equity Interest in Acquiree, Fair Value	200,000
Business Acquisition, Accounts Receivable
Business Combination, Step Acquisition, Equity Interest in Acquiree, Fair Value	1,044,375
Business Acquisition, Inventory
Business Combination, Step Acquisition, Equity Interest in Acquiree, Fair Value	950,424
Business Acquisition, Property, Plant & Equipment
Business Combination, Step Acquisition, Equity Interest in Acquiree, Fair Value	1,256,885
Business Acquisition, Prepaid
Business Combination, Step Acquisition, Equity Interest in Acquiree, Fair Value	53,535
Business Acquisition, Intangibles
Business Combination, Step Acquisition, Equity Interest in Acquiree, Fair Value	150,000
Business Acquisition, Goodwill
Business Combination, Step Acquisition, Equity Interest in Acquiree, Fair Value	2,491,945
Business Acquisition, Accounts Payable
Business Combination, Step Acquisition, Equity Interest in Acquiree, Fair Value	(672,410)
Business Acquisition, Accrued Expenses
Business Combination, Step Acquisition, Equity Interest in Acquiree, Fair Value	(128,444)
Business Acquisition, Deferred Tax Liability
Business Combination, Step Acquisition, Equity Interest in Acquiree, Fair Value	$ (346,310)

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Note 9 - Business Combination: Business Acquisition, Pro Forma Information (Details) - USD ($)	3 Months Ended		9 Months Ended
	Sep. 30, 2016	Sep. 30, 2015	Sep. 30, 2016
Details
Business Acquisition, Pro Forma Revenue	$ 1,795,769	$ 1,827,630	$ 5,974,220
Business Acquisition, Pro Forma Net Income (Loss)	$ (330,933)	$ (2,371,293)	$ (11,036,240)
Business Acquisition, Pro Forma Loss Per Share	$ (0.02)	$ (0.35)	$ (1.39)