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UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

 

FORM 10-Q

 

☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended March 31, 2024

 

☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

 

COMMISSION FILE NO. 000-56586

 

American Picture House Corporation

(Exact name of registrant as specified in its charter)

 

Wyoming

(State or other jurisdiction of incorporation)

 

7812

(Primary Standard Industrial Classification Code Number)

 

85-4154740

(IRS Employer Identification No.)

 

477 Madison Avenue, 6th Floor

New York, NY 10022

1-800-689-6885

(Address and telephone number of registrant’s executive office)

 

Securities registered pursuant to Section 12(b) of the Act:

 

Title of each class   Trading Symbol   Name of each exchange on which registered
None   N/A   N/A

 

Securities registered pursuant to Section 12(g) of the Act: Common Stock

 

Indicate by check mark whether the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act. Yes ☐ No ☒

 

Indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or Section 15(d) of the Act. Yes ☐ No ☒

 

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for shorter period that the registrant as 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 every Interactive Data File required to be submitted 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 such files). Yes ☒ No ☐

 

Indicate by check mark if disclosure of delinquent filers pursuant to Item 405 of Regulation S-K is not contained herein, and will not be contained, to the best of registrant’s knowledge, in definitive proxy or information statements incorporated by reference in Part III of this Form 10-K or any amendment to this Form 10-K. Yes ☒ No ☐

 

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

 

Large accelerated filer ☐ Accelerated filer ☐
Non-accelerated Filer ☒ Smaller reporting company ☒
    Emerging growth company ☐

 

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

 

If securities are registered pursuant to Section 12(b) of the Act, indicate by check mark whether the financial statements of the registrant included in the filing reflect the correction of an error to previously issued financial statements. ☐

 

Indicate by check mark whether any of those error corrections are restatements that required a recovery analysis of incentive-based compensation received by any of the registrant’s executive officers during the relevant recovery period pursuant to §240.10D-1(b). ☐

 

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

 

As of May 2, 2024 the Registrant had 111,399,325 shares of common stock issued and outstanding.

 

 

 

 
 

 

AMERICAN PICTURE HOUSE CORP

FORM 10-Q

FOR THE QUARTER ENDED MARCH 31, 2024

 

TABLE OF CONTENTS

 

  Page No.
GENERAL AND WHERE YOU CAN FIND MORE INFORMATION 1
PART I FINANCIAL INFORMATION F-1
ITEM 1. FINANCIAL STATEMENTS (unaudited) F-1
CONDENSED CONSOLIDATED BALANCE SHEETS – MARCH 31, 2024 AND DECEMBER 31, 2023 F-2
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS - THREE MONTHS ENDED MARCH 31, 2024 AND 2023 F-3
CONDENSED STATEMENTS OF CHANGES IN SHAREHOLDERS’ DEFICIT – THREE MONTHS ENDED MARCH 31, 2024 AND 2023 F-4
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS - THREE MONTHS ENDED MARCH 31, 2024 AND 2023 F-5
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS F-6
ITEM 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS 2
ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK 6
ITEM 4. CONTROLS AND PROCEDURES 6
PART II OTHER INFORMATION 6
ITEM 1. LEGAL PROCEEDINGS 6
ITEM 1A. RISK FACTORS 7
ITEM 2. UNREGISTERED SALES OF EQUITY SECURITIES, USE OF PROCEEDS AND ISSUER PURCHASE OF EQUITY SECURITIES 7
ITEM 3. DEFAULTS UPON SENIOR SECURITIES 7
ITEM 4. MINE SAFETY DISCLOSURES 7
ITEM 5. OTHER INFORMATION 7
ITEM 6. EXHIBITS 7
SIGNATURES 8

 

i
 

 

General and Where You Can Find Other Information

 

Unless otherwise indicated, all references to the “Company,” “we,” “our,” “APH” and “APHP” refer to American Picture House Corporation a Wyoming corporation. References to “revenues” refer to net revenues. References to “U.S. dollars,” “dollars,” “U.S. $” and “$” are to the lawful currency of the United States of America.

 

1

 

 

PART I—FINANCIAL INFORMATION

 

Item 1. Financial Statements.

 

AMERICAN PICTURE HOUSE CORPORATION

 

CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

AS OF MARCH 31, 2024

 

INDEX TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

 

  Page
Condensed Consolidated Balance Sheets, March 31, 2024 (unaudited) and December 31, 2023 F-2
Condensed Consolidated Statements of Operations, for the three months ended March 31, 2024 and 2023 F-3
Condensed Consolidated Statements of Changes in Deficit, for the three months ended March 31, 2024 and 2023 F-4
Condensed Consolidated Statements of Cash Flows, for the three months ended March 31, 2024 and 2023 F-5
Notes to Condensed Consolidated Financial Statements F-6

 

F-1

 

 

AMERICAN PICTURE HOUSE CORPORATION

CONDENSED CONSOLIDATED BALANCE SHEETS

 

   March 31, 2024   December 31, 2023 
   (Unaudited)   * 
ASSETS          
Current Assets          
Cash and cash equivalents  $25,126   $203,971 
Accounts receivable   51,775    31,948 
Prepaid expenses   13,367    29,185 
Receivable - related party   621    1,349 
Total Current Assets   90,889    266,453 
           
Produced and licensed content costs   200,403    210,633 
Loans receivable, film financing arrangements   220,000    - 
Intangible assets, net of accumulated amortization of $1,750 and $1,000 as of March 31, 2024 and December 31, 2023, respectively.   74,114    71,864 
IMM loans receivable, net of allowance of $366,387   -    - 
           
TOTAL ASSETS   585,406    548,950 
           
LIABILITIES AND STOCKHOLDERS’ DEFICIT          
Current Liabilities          
Accounts payable and accrued expenses   48,710    90,377 
Deferred revenue, current portion   50,000    - 
Interest payable - related party   1,641    - 
Interest payable - EIDL loan   10,889    11,580 
Note payable - related party   250,000    - 
           
Total Current Liabilities   361,240    101,957 
           
Economic injury disaster loan, non-current   149,900    149,900 
           
Total Liabilities   511,140    251,857 
           
Stockholders’ Equity (Deficit):          
Common Stock $0.0001 par value. 1,000,000,000 authorized. 109,865,991 and 109,790,991 issued and outstanding as of March 31, 2024 and December 31, 2023, respectively.   471,577    471,569 
Preferred Stock $0.0001 par value. 1,000,000 authorized. 3,829 issued and outstanding as of March 31, 2024 and December 31, 2023.   -    - 
Additional paid in capital   6,120,372    4,847,220 
Accumulated deficit   (6,517,683)   (5,021,696)
Total Stockholders’ Equity (Deficit)   74,266    297,093 
TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY (DEFICIT)  $585,406   $548,950 

 

*Derived from audited information

 

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

 

F-2

 

 

AMERICAN PICTURE HOUSE CORPORATION

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

(Unaudited)

 

   2024   2023 
   Three Months ended March 31, 
   2024   2023 
         
Revenues  $23,003   $169,111 
           
Cost of revenues   -    36,701 
Gross profit   23,003    132,410 
           
Operating Expenses:          
General and administrative   1,501,932    183,603 
Sales and marketing   13,975    - 
Total Operating Expenses   1,515,907    183,603 
Net Operating Loss   (1,492,904)   (51,193)
           
Other Income (Expenses):          
Interest income   102    741 
Interest expense   (3,185)   (1,888)
Net Other Income (Expenses)   (3,083)   (1,147)
Loss before income taxes   (1,495,987)   (52,340)
Income taxes   -    - 
Net loss  $(1,495,987)  $(52,340)
           
Net loss per common share - Basic and Diluted  $(0.01)  $(0.00)
           
Weighted average shares used in per share computation - Basic and Diluted   109,865,001    100,735,159 

 

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

 

F-3

 

 

AMERICAN PICTURE HOUSE CORPORATION

CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN DEFICIT

For the three months ended March 31, 2024 and 2023

(Unaudited)

 

   Shares   Par Value   Shares   Amount   Paid In Capital   Deficit   (Deficit) 
   Common Stock   Preferred Stock    Additional   Accumulated    Total
Stockholders’
Equity		 
   Shares   Par Value   Shares   Amount   Paid In Capital   Deficit   (Deficit) 
                                                                         
Balance, December 31, 2022   100,735,159   $10,074    3,829   $-   $3,577,548   $(3,655,378)  $(67,756)
                                    
Conversion of accrued liabilities totaling $105,000 into options to purchase 1,160,221 shares of Common Stock   -    -    -    -    105,000    -    105,000 
                                    
Net Loss   -    -    -    -    -    (52,340)   (52,340)
                                    
Balance, March 31, 2023   100,735,159   $10,074    3,829   $-   $3,682,548   $(3,707,718)  $(15,096)

 

   Common Stock   Preferred Stock   Additional     Accumulated   Total
Stockholders’
Equity  		 
   Shares   Par Value   Shares   Amount   Paid In Capital   Deficit   (Deficit) 
                                                                         
Balance, December 31, 2023   109,790,991   $10,979    3,829   $-   $5,307,810   $(5,021,696)  $297,093 
                                    
Issuance of Common Stock for cash   75,000    8    -    -    14,992    -    15,000 
                                    
Stock option compensation   -    -    -    -    1,258,160    -    1,258,160 
                                    
Net Loss   -    -    -    -    -    (1,495,987)   (1,495,987)
                                    
Balance, March 31, 2024   109,865,991   $10,987    3,829   $-   $6,580,962   $(6,517,683)  $74,266 

 

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

 

F-4

 

 

AMERICAN PICTURE HOUSE CORPORATION

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(Unaudited)

 

   2024   2023 
   Three Months ended March 31, 
   2024   2023 
Cash Flows from Operating Activities:          
Net Income (Loss)  $(1,495,987)  $(52,340)
Adjustments to Reconcile Net Income (Loss) to Net Cash Flows from Operating Activities:          
Expiration of produced and licensed costs   15,000    - 
Stock option expense   1,258,160    - 
Amortization expense   750    - 
Change in operating assets and liabilities:          
Accounts receivable   (19,827)   109,702 
Prepaid expenses   15,818    17,838 
Other receivables   -    168 
Receivables - related party   728    - 
Loans receivable, film financing arrangements   (220,000)   - 
Accounts payable and accrued expenses   (41,667)   (41,783)
Payable to related party   -    (130,000)
Interest payable - related parties   1,641    111 
Interest payable - EIDL loan   (691)   1,386 
Deferred revenue   50,000    (35,000)
Net Cash Flows from Operating Activities   (436,075)   (129,918)
           
Cash Flows from Investing Activities:          
Produced and licensed costs   (4,770)   (10,016)
Intangible assets   (3,000)   - 
Net Cash Flows from Investing Activities   (7,770)   (10,016)
           
Cash Flows from Financing Activities:          
Proceeds from debt borrowings - related parties   250,000    125,000 
Proceeds from sale of Common Stock   15,000    - 
Net Cash Flows from Financing Activities   265,000    125,000 
           
Net Increase in Cash and Cash Equivalents   (178,845)   (14,934)
Cash and Cash Equivalents, Beginning of Period   203,971    31,573 
Cash and Cash Equivalents, End of Period  $25,126   $16,639 
           
Non-cash Financing and Investing Activities:          
Conversion of accrued expenses into options to purchase Common Stock  $-   $105,000 

 

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

 

F-5

 

 

AMERICAN PICTURE HOUSE CORPORATION

NOTES TO (UNAUDITED) FINANCIAL STATEMENTS

 

NOTE 1 – Organization And Description Of Business

 

American Picture House Corporation. (“the Company,” “we” “us”) was incorporated in the State of Nevada on September 21, 2005, originally under the corporate name of Servinational, Inc. The Company subsequently changed its name to Shikisai International, Inc. in November 2005 and then to Life Design Station, Intl., Inc. in August 2007. The Company changed its state of domicile from Nevada to Wyoming on October 13, 2020. On December 4, 2020, the Company changed its name to American Picture House Corporation.

 

The Company’s year-end is December 31.

 

NOTE 2 – Summary Of Significant Accounting Policies

 

Basis of Presentation

 

The accompanying financial statements have been prepared in accordance with the Financial Accounting Standards Board (“FASB”) “FASB Accounting Standard Codification™” (the “Codification”) which is the source of authoritative accounting principles recognized by the FASB to be applied by nongovernmental entities in the preparation of financial statements in conformity with accepted accounting principles (“GAAP”) in the United States.

 

Principles of Consolidation

 

The condensed consolidated financial statements of the Company include the accounts of American Picture House Corporation and its wholly owned subsidiaries, Devil’s Half-Acre, LLC and Ask Christine Productions, LLC.

 

Going Concern

 

The accompanying financial statements have been prepared assuming the Company will continue as a going concern, which contemplates the realization of assets and the satisfaction of liabilities in the normal course of business for the twelve months following the date of these financial statements. As of March 31, 2024, the Company had a working capital deficit of ($270,351) and an accumulated deficit of $6,517,683.

 

Because the Company does not expect that the existing operational cash flow will be sufficient to fund presently anticipated operations, this raises substantial doubt about the Company’s ability to continue as a going concern. Therefore, the Company will need to raise additional funds and is currently exploring alternative sources of financing. Recently the Company has been funded by related party shareholders and officers. Historically, the Company raised capital through private placements, to finance working capital needs and may attempt to raise capital through the sale of common stock or other securities and obtaining some short-term loans. The Company will be required to continue to do so until its operations become profitable. Also, the Company has, in the past, paid for consulting services with its common stock to maximize working capital, and intends to continue this practice where feasible.

 

Use of Estimates

 

The preparation of financial statements in conformity with US GAAP requires management to make estimates and assumptions that affect the reported amounts of liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. The most significant estimates relate to income taxes and contingencies. The Company bases its estimates on historical experience, known or expected trends, and various other assumptions that are believed to be reasonable given the quality of information available as of the date of these financial statements. The results of these assumptions provide the basis for making estimates about the carrying amount of assets and liabilities that are not readily apparent from other sources. Actual results could differ from these estimates.

 

F-6

 

 

Cash and cash equivalents

 

Cash equivalents are short-term highly liquid investments which include short term bank deposits (up to three months from date of deposit), that are not restricted as to withdrawals or use that are readily convertible to cash with maturities of three months or less as of the date acquired. The Company’s policy is to maintain its cash balances with financial institutions with high credit ratings and in accounts insured by the Federal Deposit Insurance Corporation (the “FDIC”) and/or by the Securities Investor Protection Corporation (the “SIPC”). The Company may periodically have cash balances in financial institutions in excess of the FDIC and SIPC insurance limits of $250,000 and $500,000, respectively. The Company has not experienced any losses to date resulting from this policy.

 

Accounts receivable

 

Accounts receivable primarily consist of trade receivables due from customers for consulting services and from fees derived from licensing of IP to content providers worldwide. As of March 31, 2024, $50,000 (97%) of accounts receivable were related to the grant of a producer credit in a proposed future film. As of December 31, 2023, 100% of accounts receivable were due from the BUFFALOED CAMA (see Assigned Rights to feature film, BUFFALOED below).

 

   March 31, 2024   December 31, 2023 
Accounts receivable, trade  $50,000   $- 
Accounts receivable, related party   1,775    - 
Accounts receivable, CAMA   -    31,948 
Accounts receivable   $51,775   $31,948 

 

Allowance for doubtful accounts

 

The allowance for doubtful accounts is determined with respect to amounts the Company has determined to be doubtful of collection. In determining the allowance for doubtful accounts, the Company considers, among other things, its past experience with customers, the length of time that the balance is past due, the customer’s current ability to pay and available information about the credit risk on such customers. In 2023, the Company wrote off $193,932 of receivables as bad debt based on a review of the customer’s ability to pay, the customer’s Managing Director resigning, and the customer ceasing operations. There was no bad debt expense during the quarter ended March 31, 2024 and no allowance for doubtful accounts at March 31, 2024 or December 31, 2023.

 

Prepaid expenses

 

At March 31, 2024, prepaid expenses consisted of prepaid insurance, prepaid licenses, and prepaid services. Prepaid expenses are amounts paid to secure the use of assets or the receipt of services at a future date or continuously over one or more future periods. When the prepaid expenses are eventually consumed, they are charged to expense. The Company had $13,367 and $29,185 in prepaid expenses as of March 31, 2024 and December 31, 2023, respectively.

 

Produced and Licensed Content Costs

 

Capitalized production costs, whether produced or acquired/ licensed rights, include development costs, direct costs and production overhead. These amounts and licensed content are included in “Produced and Licensed Content Costs” on the balance sheet as follows:

 

   March 31, 2024   December 31, 2023 
Films in development and pre-production stage  $200,403   $210,633 
   $200,403   $210,633 

 

F-7

 

 

Impairment Assessment for Investment in Films and Licensed Program Rights

 

A film group or individual film is evaluated for impairment when an event or change in circumstances indicates that the fair value of an individual film or film group is less than its unamortized cost.

 

During the quarter ended March 31, 2024, the Company allowed options to two screenplays to expire and wrote-off $15,000 of previously capitalized option costs.

 

Assigned rights to the feature film, BUFFALOED.

 

In November 2022, the Company obtained certain limited rights to the feature film BUFFALOED from Bold Crayon, Inc. (“BC”), including a secured position of a one million three hundred eighty-thousand-dollar ($1,380,000.00 USD) receivable against the film’s revenues as per the film’s Cash Asset Management Agreement (“CAMA”) and a 35% share of the profits generated thereafter (“the BC Assets”). During the quarters ended March 31, 2024 and 2023, the Company reported revenues of $23,003 and $0, respectively, from the CAMA. Inception to date, the Company has received $304,875 under the CAMA. Due to uncertainties of any future revenue, if any, no value has been assigned to any potential future revenues.

 

As partial consideration for the BC Assets being acquired by APH hereunder, APHP agreed to pay BC the first one hundred thirty thousand dollars ($130,000.00 USD) that APHP collected from the BUFFALOED and to deliver one Preferred Share to BC for each ten thousand dollars ($10,000.00 USD), in value paid to the APHP from the BUFFALOED receivable above the one hundred thirty thousand dollars ($130,000.00 USD), not to exceed one hundred twenty-five (125) Preferred Shares. As of March 31, 2024, Bold Crayon was due to receive 17 Preferred Shares of APHP.

 

Intangible assets

 

The Company’s intangible assets include in-service and under-development websites and licensed internal use software. During the year ended December 31, 2023 the Company developed an external website that was placed in service during the third quarter of 2023. Additionally, during the fourth quarter of 2023 the Company began developing additional aspects of its website that went live in April 2024. During the fourth quarter of 2023, the Company licensed rights to new internal use software, but subsequently placed that project on hold and has not established a timeline for placing the software in service.

 

The capitalized costs of the Company’s websites placed into service were subject to straight-line amortization over a three-year period. Amortization expense totaled $$750 and $0 for the quarters ended March 31, 2024 and 2023, respectively.

 

Deferred Revenue

 

Deferred revenue represents the amount billed to clients that has not yet been earned, pursuant to agreements entered into in current and prior periods. As of March 31, 2024 and December 31, 2023, total net deferred revenue was $50,000 and $0, respectively. As previously noted, the $50,000 in deferred revenue at March 31, 2024, relates to the grant of a producer credit to a proposed film.

 

Revenues and Costs from Services and Products – Historically, Company’s revenue comes from contracts with customers for consulting services and from the licensing and distribution of film and other entertainment rights. The consulting services typically relate to development of business strategy and monetization of intellectual property rights. The Company accounts for a contract with a customer when there is an enforceable contract between the Company and the customer, the rights of the party are identified, the contract has economic substance, and collectability of the contract is considered probable. Historically, the term of these consulting agreements has been approximately three to six months in duration. The Company’s revenue is measured based on considerations specified in the contract with each customer. Accounting Standards Codification (“ASC”) 606 allows for adoption of an “as invoiced” practical expedient that allows companies to recognize revenue in the amount to which the entity has a right to invoice when they have a right to consideration from a customer in an amount that corresponds directly with the value to the customer of the entity’s performance completed to date. The Company has elected to adopt this practical expedient with regards to its consulting services revenue. Revenues for the three months ended March 31, 2023 totaled $165,000. As discussed in Note 10 – Related Party Transactions, $35,000 of the revenue was from Ribo Music and the remaining $135,000 was from a second client. The Company did not have any consulting revenues in 2024.

 

F-8

 

 

Revenues from Films and Licensed Rights, are calculated based on expected ultimate revenues estimated over a period not to exceed ten years following the date of initial release of the motion picture. For an episodic television series, the period over which ultimate revenues are estimated cannot exceed ten years following the date of delivery of the first episode, or, if still in production, five years from the date of delivery of the most recent episode, if later. For titles included in acquired libraries, ultimate revenue includes estimates over a period not to exceed twenty years following the date of acquisition.

 

Revenue derived from the BUFFALOED CAMA totaled $23,003 and $0 for the quarters ended March 31, 2024 and 2023, respectively.

 

Fair Value Measurements – The Company measures and discloses fair value in accordance with the ASC Topic 820, Fair Value Measurements and Disclosures which defines fair value, establishes a framework and gives guidance regarding the methods used for measuring fair value, and expands disclosures about fair value measurements. Fair value is an exit price, representing the amount that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. As such, fair value is a market-based measurement that should be determined based on assumptions that market participants would use in pricing an asset or liability. As a basis for considering such assumptions there exists a three-tier fair-value hierarchy, which prioritizes the inputs used in measuring fair value as follows:

 

Level 1 - unadjusted quoted prices are available in active markets for identical assets or liabilities that the Company has the ability to access as of the measurement date.

 

Level 2 - pricing inputs are other than quoted prices in active markets that are directly observable for the asset or liability or indirectly observable through corroboration with observable market data.

 

Level 3 - pricing inputs are unobservable for the non-financial asset or liability and only used when there is little, if any, market activity for the non-financial asset or liability at the measurement date. The inputs into the determination of fair value require significant management judgment or estimation. Level 3 inputs are considered as the lowest priority within the fair value hierarchy. The valuation of the right to obtain control over affiliated company, right to acquire shares of other companies, contingent consideration to be paid upon achieving of performance milestone, certain convertible bridge loans (following the maturity date and thereafter) and certain freestanding stock warrants and bifurcated convertible feature of convertible bridge loans issued to the units’ owners, fall under this category.

 

This hierarchy requires the Company to use observable market data, when available, and to minimize the use of unobservable inputs when determining fair value.

 

The fair value of cash and cash equivalents is based on its demand value, which is equal to its carrying value. Additionally, the carrying value of all other short-term monetary assets and liabilities are estimated to be equal to their fair value due to the short-term nature of these instruments.

 

Valuation of Long-Lived Assets – The Company evaluates whether events or circumstances have occurred which indicate that the carrying amounts of long-lived assets (principally produced and licensed content costs) may be impaired or not recoverable. The significant factors that are considered that could trigger an impairment review include: changes in business strategy, market conditions, or the manner of use of an asset; underperformance relative to historical or expected future operating results; and negative industry or economic trends. In evaluating an asset for possible impairment, management estimates that asset’s future undiscounted cash flows and appraised values to measure whether the asset is recoverable. The Company measures the impairment based on the projected discounted cash flows of the asset over its remaining life.

 

F-9

 

 

Stock-Based Compensation – The Company follows U.S. GAAP, which requires all stock-based compensation to employees, including the grant of employee stock options, to be recognized in the statement of operations based on its fair value. Awards outstanding are accounted for using the accounting principles originally applied to the award. The expense associated with share-based compensation is recognized on a straight-line basis over the service period of each award. Refer to Note 8 for additional information related to this stock-based compensation plan.

 

Income taxes

 

The Company accounts for income taxes under FASB ASC 740, “Accounting for Income Taxes”. Under FASB ASC 740, deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. Under FASB ASC 740, the effect on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period that includes the enactment date. FASB ASC 740-10-05, “Accounting for Uncertainty in Income Taxes” prescribes a recognition threshold and a measurement attribute for the financial statement recognition and measurement of tax positions taken or expected to be taken in a tax return. For those benefits to be recognized, a tax position must be more-likely-than-not to be sustained upon examination by taxing authorities.

 

The amount recognized is measured as the largest amount of benefit that is greater than 50 percent likely of being realized upon ultimate settlement. The Company assesses the validity of its conclusions regarding uncertain tax positions quarterly to determine if facts or circumstances have arisen that might cause it to change its judgment regarding the likelihood of a tax position’s sustainability under audit.

 

Net Loss per Share

 

Basic (loss) income per share is computed by dividing net (loss) income available to Common Stockholders by the weighted average number of common shares outstanding during the period. Diluted (loss) income per share reflects the potential dilution, using the treasury stock method that could occur if securities or other contracts to issue Common Stock were exercised or converted into Common Stock or resulted in the issuance of Common Stock that then shared in the (loss) income of the Company. In computing diluted (loss) income per share, the treasury stock method assumes that outstanding instruments are exercised/converted, and the proceeds are used to purchase Common Stock at the average market price during the period. Instruments may have a dilutive effect under the treasury stock method only when the average market price of the Common Stock during the period exceeds the exercise price/conversion rate of the instruments.

 

The following common share equivalents are excluded from the calculation of weighted average common shares outstanding because their inclusion would have been anti-dilutive:

 

   March 31, 2024   December 31, 2023 
Convertible Preferred Stock   382,900,000    382,900,000 
Options to Purchase Common Stock   5,083,471      
           
    387,983,471    382,900,000 

 

Segment Information

 

Operating segments are defined as components of an enterprise about which separate discrete information is available for evaluation by the chief operating decision maker (“CODM”), or decision-making group, in deciding how to allocate resources and in assessing performance. For the period of these financial statements, the CEO of the Company was the CODM. The Company views its operations and manages its business as one operating and reporting segment.

 

New accounting standards

 

The Company’s management has evaluated all the recently issued, but not yet effective, accounting standards and guidance that have been issued or proposed by the FASB or other standards-setting bodies through the filing date of these financial statements and does not believe the future adoption of any such pronouncements will have a material effect on the Company’s financial position and results of operations.

 

F-10

 

 

Note 3 – Liquidity and Going Concern

 

The Company’s financial statements are prepared using account principles generally accepted in the United States (“U.S. GAAP”) applicable to a going concern, which contemplates the realization of assets and liquidation of liabilities in the normal course of business. As of March 31, 2024, the Company had a working capital deficit of ($270,351) and an accumulated deficit of $6,517,683. These factors, among others, raise doubt about the Company’s ability to continue as a going concern. The accompanying financial statements do not include adjustments to reflect the possible future effects on the recoverability and classification of assets or the amounts and classification of liabilities that may result from an inability of the Company to continue as a going concern.

 

The Company has a limited operating history, which makes it difficult to evaluate current business and future prospects. During 2023, the Company reported $169,111 of service revenues, down from $461,174 in 2023 and no revenues in 2021 and 2020. Management expects the Company to incur further losses in the foreseeable future due to costs associated with content acquisition and production, the cost of on-going litigation, and costs associated with being a public company. There can be no assurance that our operations will ever generate sufficient revenues to fund continuing operations, or that we will ever generate positive cash flow from our operations, or that we will attain or thereafter sustain profitability in any future period. To mitigate this situation, the Company has loan agreements with the Company’s CEO and the Noah Morgan Private Family Trust, a trust controlled by the Company’s CEO, to fund its month-to-month cash flow needs. During the first quarter of 2024, the Company borrowed $250,000 from the trust pursuant to a master loan agreement that is due and payable in 2025. During 2023, the Company borrowed $178,500 from and repaid $178,500 to Mr. MacGregor pursuant to a master loan agreement. The master note agreements accrue interest at a rate of 4.4% due and payable in a lump sum upon maturity of the obligation. These notes are not convertible.

 

NOTE 4. Film Production Loans

 

Senior Mezzanine Loan Agreement with Barron’s Cove Movie, LLC

 

In February 2024, the Company loaned $200,000 to Barron’s Cove Movie, LLC pursuant to a Senior Mezzanine Loan Agreement. $20,000 of the loan proceeds will be used to pay producer fees, including $10,000 to Mr. MacGregor. The $200,00 loan, plus a premium of twenty percent (20%), is due and payable on that date which is the earlier of either (a) twelve (12) months from the date of the loan, or (b) from allocable proceeds received by Barron’s Cove Movie, LLC related to the movie, whichever occurs first.

 

Senior Loan Agreement with PNP Movie, LLC

 

In February 2024, the Company agreed to loan PNP Movie, LLC $97,475 to be used solely in connection with a named feature length motion picture. As of March 31, 2024, $20,000 had been advanced against this funding commitment. In April 2024, the loan agreement was amended whereby the Company agreed to lend an additional $42,525 and to use best efforts to increase the aggregate financing to $597,475. As of the date of this filing, a total of $195,000 had been advanced to PNP Movie, LLC. These loans, plus a premium of twenty percent (20%), is due and payable on that date which is the earlier of either (a) twelve (12) months from the date of the loan, or (b) from allocable proceeds received by PNP Movie, LLC related to the movie, whichever occurs first.

 

Additionally, the agreement states that Mr. MacGregor shall be entitled to a producer fee based on work to be performed and that Mr. MacGregor will receive a “Producer” credit and his son a “Co-Producer” credit on the film.

 

F-11

 

 

NOTE 5. Intangible Assets

 

The identifiable intangible assets consist of the following assets:

 

   March 31, 2024   December 31, 2023 
Website placed in service  $9,000   $9,000 
Website - under development   42,000    42,000 
Software – predeployment   24,864    21,684 
Intangible assets, gross   75,864    72,684 
           
Accumulated amortization   (1,750)   (1,000)
Intangible assets, net  $74,114   $71,684 

 

There were no impairment charges associated with the Company’s identifiable intangible assets during the quarters ended March 31, 2024 and 2023.

 

Amortization expense recorded in the accompanying consolidated statements of operations was $750 for the quarter year ended March 31, 2024. The Company did not own any intangible assets during the quarter-ended March 31, 2023.

 

Note 6 – Notes Payable

 

Note Payable – Mr. MacGregor

 

During the first quarter of 2023, the Company borrowed $125,500 from Mr. MacGregor pursuant to a master loan agreement dated March 1, 2023. The master note agreement accrues interest at a rate of 4.4% due and payable in a lump sum upon maturity of the obligation. This note is not convertible.

 

During the first quarter of 2024, the Company borrowed $250,000 from a trust managed by Mr. MacGregor pursuant to a master loan agreement dated February 6, 2024. The master note agreement accrues interest at a rate of 4.68% due and payable in a lump sum upon maturity of the obligation. This note is not convertible.

 

Noah Morgan Private Family Trust Loan Agreement (“NMPFT”)

 

On February 6, 2024, the Company entered into a master loan agreement with the NMPFT. The master note agreement accrues interest at a rate of 4.68%. Also during February 2024, the Company borrowed $250,000 pursuant to this loan agreement with this amount due and payable in a lump sum on February 6, 2025. This note is not convertible. $200,000 of these loan proceeds were used to fund the senior mezzanine loan to Barron’s Cove Movie, LLC as more fully described in Note 4 above.

 

Economic Injury Disaster Loan

 

In March 2021, the Company executed an Economic Injury Disaster Loan (“EIDL”) secured loan with the U.S. Small Business Administration under the EIDL program in the amount of $149,900. The loan is secured by all tangible and intangible assets of the Company and payable over 30 years at an interest rate of 3.75% per annum. Interest only installment payments commenced in September 2023.

 

Note 7 – Equity

 

Common Stock

 

The Company has 1,000,000,000 common shares authorized. As of May 2, 2024, the Company has 111,399,325 shares issued and outstanding. As of May 2, 2024, the total number of shareholders of record was 331.

 

The Common Stock has a one share one voting right with no other rights. There are no provisions in the Company’s Articles of Incorporation, Articles of Amendment, or By-laws that would delay or prevent a change of control. The Board may from time to time declare, and the Company may pay, dividends on its shares in cash, property, or its own shares, except when the Corporation is insolvent, when the payment thereof would render the Company insolvent, subject to any preferential dividend rights of outstanding shares of preferred shares or when the declaration or payment thereof would be contrary to any other state law restrictions.

 

F-12

 

 

Preferred Stock

 

The Preferred Stock consists of 1,000,000 preferred shares authorized, of which 100,000 preferred shares have been designated as Series A Convertible Preferred Stock (“Series A preferred shares” herein). At present, 3,829 Series A preferred shares are issued and outstanding. The Series A preferred shares have the following rights: (i.) a first position lien against all of the Company’s assets including but not limited to the Company’s IP (“Intellectual Property”), (ii.) is convertible at a ratio of 1 to 100,000 so that each one share of Series A preferred stock may be exchanged for 100,000 Common Stock shares, (iii.) and that each share of Series A preferred stock shall carry superior voting rights to the Company’s Common Stock and that each share of Series A preferred stock shall be counted as 1,000,000 votes in any Company vote and (iv.) and any other benefits as deemed necessary and appropriate at the time of such issuance. The Preferred shares do not have any specific redemption rights or sinking fund provisions.

 

The “Liquidation Preference” with respect to a share of Series A preferred stock means an amount equal to the ratio of (i.) the total amount of the Company’s assets and funds available for distribution to the Series A preferred shares to (ii.) the number of shares of Series A preferred stock outstanding. The Series A preferred stock has a liquidation preference equal to $12.02 per preferred share.

 

Dividend Provisions

 

Subject to preferential dividend rights, if any, of the holders of Preferred Stock, dividends on the Common Stock may be declared by the Board of Directors and paid out of any funds legally available therefor at such times and in such amounts as the Board of Directors shall determine.

 

Note 8– Equity Based Compensation

 

The American Picture House Corporation 2023 Directors, Employees and Advisors Stock Incentive and Compensation Plan (the “Plan”) was established in January 2023 to create an additional incentive to promote the financial success and progress of the Company. The Plan shall be administered by the Board of Directors and may grant options to purchase shares of the authorized but unissued Common Stock of the Company. The options may be either incentive stock options or nonqualified stock options.

 

The options granted under the Plan expire on the date determined by the Board of Directors and may not extend more than 10 years.

 

Under the Plan, unless the board specifies otherwise, stock options must be granted at an exercise price not less than the fair value of the Company’s Common Stock on the grant date. The aggregate fair value of incentive stock options held by any optionee shall not exceed $100,000.

 

The Board of Directors shall determine the terms and conditions of the options. The vesting requirements of all awards under the Plan may be time or event based and vary by individual grant. The incentive stock options and nonqualified stock options generally become exercisable over a two-year period. Vested and unexercised options may be available to be exercised no later than three months after termination of employment (or such longer period as determined by the Board of Directors).

 

Stock Option Grants

 

On February 8, 2024, the Company’s Board of Directors authorized the issuance of 250,000 options to each of its nine board members, 1,673,250 options to advisors, 662,983 options to Mr. Macgregor, and 497,238 options to Mr. Blanchard for an aggregate of 5,083,471 options with the rights to purchase common shares of the Company at an exercise price of $0.0125 per share. As all of the options vested 100% upon grant, the Company recorded $1,258,160 of stock option compensation expense in the quarter ended March 31, 2024. Share-based compensation expense is reported within General and Administrative expenses.

 

F-13

 

 

Note 9 – Contingencies and Uncertainties

 

Risks and Uncertainties – The Company’s operations are subject to significant risks and uncertainties including financial, operational, and regulatory risks, including the potential risk of business failure. The Company does not have employment contracts with its key employees, including the controlling shareholders who are officers of the Company.

 

NOTE 10 – Related Party Transactions

 

The Company has agreed to indemnify Mr. MacGregor for all legal and professional costs originating from the lawsuit Randall S. Sprung v. Bannor Michael MacGregor, Jeffery Katz, and Life Design Station International, Inc. – Supreme Court of New York, County of Kings, Index No.: 504677/2019.

 

During the three months ended March 31, 2024 and 2023, the Company incurred approximately $45,000 and $30,000, respectively, of professional fees to a legal firm affiliated with a member of the Board of Directors.

 

The Company has consulting services relationships with members of the Board whereby they were compensated a total of $15,000 and $26,000 during the three months ended March 31, 2024 and 2023, respectively. As of March 31, 2024 and December 31, 2023, $0 and $20,000, respectively, were accrued and unpaid. The consulting services are provided as requested by management and may be terminated at any time with no penalty. On January 1, 2023, the $105,000 of the 2022 accrued consulting fees were exchanged for options to purchase 1,160,221 shares of Common Stock at $0.125 per share.

 

During 2022, the Company entered into consulting agreements with Ribo Music LLC aka Ribo Media (“Ribo Media”) whereby the Company assisted Ribo Media in developing an online media platform to deliver music and eventually movies directly to consumers via their smart devices. Revenues from the Ribo Media consulting services totaled $0 and $35,000, for the three months ended March 31, 2024 and 2023, respectively. As of March 31, 2024 and December 31, 2023, accounts receivable from Ribo Media totaled $1,775 and $0, respectively. Michael Blanchard, a director and shareholder of the Company and Timothy Battles, a director and shareholder of the Company, are both Managing Members and controlling shareholders in Ribo Media.

 

In August 2022, the Company funded Devil’s Half-Acre Productions, LLC owned by John Luessenhop to produce the feature film Devil’s Half-Acre written and directed by Dashiell Luessenhop, a son of A. John Luessenhop, a former Board member. In July 2023 APH obtained 100% ownership of Devil’s Half-Acre Productions, LLC and executed a new option agreement with the writer. In September 2023, APH paid a Five Thousand-Dollar (5,000) option fee to the writer. This option entitles APH to produce the film by July 2024, with the ability to extend the option for an additional two (2) years. As of March 31, 2024, the Company has capitalized $148,824 of production costs associated with this film.

 

During 2022, the Company entered into definitive agreements to secure Bold Crayon Corporation (“Bold Crayon” or “BC”) as a development partner and purchased certain assets from Bold Crayon, including a portion of the rights to a feature film, and copyrights on six film titles. The Parties agree that APHP will designate BC as a “Content Partner”, wherein BC will develop content and present APHP with a first opportunity to co-finance and/or coproduce content developed by BC subject to a mutually agreed upon Content Partner Agreement and BC will accept such designation. The Company anticipates any rights and obligations between APH and BC to be effective upon the greenlighting of a specific film or show Mr. MacGregor, CEO and a director of the Company, Mr. MacGregor is also the CEO and a director of Bold Crayon and effectively controls Bold Crayon as a managing manager of the trustee of the trust that owns the majority ownership interest in Bold Crayon. Mr. Michael Blanchard was a past Director and Secretary/Treasurer of Bold Crayon and is a director of APHP. The transaction between the parties has been consummated and all IP and copyrights have been transferred. During the quarters ended March 31, 2024 and 2023, the Company reported revenues of $23,003 and $0, respectively, from the CAMA. Inception to date, the Company has received $304,875 under the CAMA. As partial consideration for the BC Assets being acquired by APH hereunder, APHP agreed to pay BC the first one hundred thirty thousand dollars ($130,000.00 USD) that APHP collected from the BUFFALOED and to deliver one Preferred Share to BC for each ten thousand dollars ($10,000.00 USD), in value paid to the APHP from the BUFFALOED receivable above the one hundred thirty thousand dollars ($130,000.00 USD), not to exceed one hundred twenty-five (125) Preferred Shares. As of March 31, 2024, Bold Crayon was due to receive 17 Preferred Shares of APHP.

 

F-14

 

 

On November 10, 2022, the Company approved the optioning of MIDNIGHT’S DOOR written by Kirsten Elms from Mr. Luessenhop for $12,700 (provided the Company produces MIDNIGHT’S DOOR as a feature film and further subject to producer agreements with Luessenhop and MacGregor). Mr. Luessenhop was a director of the Company and owned 2.005% of the Company at the time of this transaction. The Company elected to allow this option to expire during the first quarter of 2024 resulting in the expensing of $7,500 of previously capitalized costs.

 

On November 10, 2022 the Company entered into an additional agreement regarding THE DEVIL’S HALF-ACRE to extend additional financing in an undetermined amount to the film in exchange among other things for increased equity in the film. At the time, DEVIL’S HALF-ACRE was controlled by Mr. Luessenhop.

 

During the first quarter of 2023, the Company borrowed $125,500 from Mr. MacGregor pursuant to a master loan agreement dated March 1, 2023. The master note agreement accrues interest at a rate of 4.4% due and payable in a lump sum upon maturity of the obligation. This note is not convertible.

 

During the first quarter of 2024, the Company borrowed $250,000 from a trust managed by Mr. MacGregor pursuant to a master loan agreement dated February 6, 2024. The master note agreement accrues interest at a rate of 4.68% due and payable in a lump sum upon maturity of the obligation. This note is not convertible.

 

NOTE 11 – SUBSEQUENT EVENTS

 

In accordance with FASB ASC 855-10, Subsequent Events, the Company has analyzed its operations subsequent to March 31, 2024, to the date these consolidated financial statements were issued. Except as noted below, management has determined that it does not have any material subsequent events to disclose in these consolidated financial statements.

 

Sales of Common Stock

 

During the period April 1, 2024 to present, the Company sold 616,000 shares of Common Stock at $0.25 per share to new investors resulting in total proceeds of $154,000.

 

Borrowing under Line of Credit

 

On April 1 and April 10, the Company borrowed $70,000 and $44,300 under its American Express Business Line of Credit. The April 1st advance had an annual percentage rate of 16.09% and is payable in twelve monthly installments. The April 10th advance had an annual percentage rate of 32.67% and is payable in six monthly installments. Repayment of these borrowings commenced in May 2024. Mr. MacGregor has personally guaranteed these loans.

 

On April 1, 2024 Bannor Michael MacGregor loaned the Company $25,000. On April 15th, the Company paid back $12,500 to Mr. MacGregor.

 

F-15

 

 

ITEM 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

 

Management’s discussion and analysis of financial condition and results of operations

 

Organizational History of the Company and Overview

 

American Picture House Corporation aka American Picture House Pictures plans to be a premiere entertainment company with a focus on feature films, limited series, and content-enhancing technologies. APHP is managed by astute financiers and supported by seasoned creatives. To date, the Company has provided general consulting services to entertainment industry-based clients. These clients were interested in our entertainment industry expertise and general business knowledge. The services provided included the strategy, development, and procurement of materials including; business plans, financial projections, and corporate marketing materials for the entertainment industry. The Company has refocused its efforts and will no longer be providing these services to independent clients. Going forward, APHP plans to partner with filmmakers, showrunners, content developers and strategic technology partners to develop, package, finance, and produce high-quality feature films and television shows with broad-market appeal. The Company’s management, Board of Directors and advisors have had relationships with major studios due to many of them having worked within the entertainment industry on many films and shows in a variety of specialties including: writing, producing, directing, casting, sales, and licensing. Although these relationships have not yet yielded results to APHP to date, the Company anticipates it will be able to access these relationships to benefit the Company in its future endeavors.

 

The Company intends to specialize in mid-budgeted productions where more than 100% of the budget can be collateralized by a film’s or show’s intellectual property (‘IP”), unsold licensing sales projections, pre-sold licensing contracts, incentive agreements, tax rebates, and grants. The Company’s management and advisors will use these assets to limit risk and guarantee greater profitability. The IP (e.g., the book rights, script, screenplay, etc.) of a particular film or show usually has a quantifiable value, especially if such IP was written by a recognized author or by a WGA (“Writers Guild of America”) writer and further enhanced by the addition of competent producers, proven directors and directors of photography, and talented actors. While the IP itself has value, the previously mentioned elements plus the addition of factors like choosing favorable filming locales to film in (that provide monetary and/or tax incentives) and formulating lean budgets, enable third party financiers to quantify a film’s or show’s value and this quantifiable-value can be utilized to secure additional equity investors and or be utilized to secure loans. Through the development of a strong package, APHP can limit its overall financial exposure, mitigate financial risk, and reduce the equity required from the Company to produce a film or show Loans and additional equity, are usually only secured for films that have a package that has strong elements and additional factors; therefore, a reduction in equity combined with third-party participation also is expected to increase profitability to the Company.

 

The Company will strive to become synonymous with creative ability, financial sophistication, and leading-edge technology. The Company has optioned IP with the intent to co-finance and co-produce feature films and limited series shows.

 

Filmmaking Stages and Our Strategy

 

To understand our business strategy, it is useful to think of filmmaking in five stages - often with different teams involved at different stages:

 

  ● Development: The first stage in which the ideas for the film are created, rights to books/plays are acquired and the screenplay is written. Financing for the project has to be sought and obtained;
  ● Pre-Production: Arrangements and preparations are made for the shoot, such as hiring cast and film crew, selecting locations and constructing sets;
  ● Production: The raw footage and other elements for the film are recorded during the film shoot;
  ● Post-Production: The images, sound, and visual effects of the recorded film are edited and combined into a finished product; and
  ● Distribution: The completed film is distributed, marketed, and screened in cinemas and/or released to video or steaming services.

 

2

 

 

Our Strategy to Build Value

 

Our business strategy is to purchase and/or option “entertainment properties” (e.g., book rights, screenplays, scripts, etc.). that have had some level of financial investment in the development stage before we acquire the entertainment property where the initial owner or development team decided to stop development for financial or other reasons after making a substantial investment in development. For this investment, we may share with the original team rights to revenue from the acquired entertainment properties. This strategy will allow the Company to reduce our initial cash outlay when acquiring intellectual properties, allows us to allocate more funds in moving the entertainment property up the filmmaking chain, gives us assistance and goodwill from the original development team, and reduces our financial risks.

 

Our strategy requires us to make an informed assessment that our management team has the ability to move the script forward where the initial team failed while allowing APHP to capitalize on the initial investment.

 

 

We seek to build value in our entertainment properties by many means, including the following:

 

  ● Hiring other qualified Writers Guild of America (“WGA”) writers to further develop, polish, or re-write entertainment properties;
  ● Securing or attaching quality talent (e.g., producers, director, actors, etc.);
  ● Determining pre-sales values;
  ● Securing some pre-sales (mostly in international markets);
  ● Securing financial and banking relations;
  ● Hiring a talent agency, retaining attorneys;
  ● Determining shooting locations, including the best place to obtain financial incentives and/or grants;
  ● Developing a comprehensive budget and devising financing strategy;
  ● Securing a completion bond; and
  ● Developing production and marketing materials (e.g., look-book, location scouting, poster-design, etc.).

 

Critical Accounting Policies and Estimates

 

Our management’s discussion and analysis of our financial condition and results of operations are based on our financial statements, which have been prepared in accordance with U.S. generally accepted accounting principles, or “GAAP.” The preparation of these financial statements requires us to make estimates and assumptions that affect the reported amounts of assets and liabilities, disclosure of contingent assets and liabilities at the date of the financial statements, and the reported amounts of revenue and expenses during the reported period. In accordance with GAAP, we base our estimates on historical experience and on various other assumptions that we believe are reasonable under the circumstances. Actual results may differ from these estimates under different assumptions or conditions.

 

Our significant accounting policies are fully described in Note 2 to our financial statements appearing elsewhere in this Quarterly Report, and we believe those accounting policies are critical to the process of making significant judgments and estimates in the preparation of our financial statements.

 

COVID-19 Update

 

To date, the COVID-19 pandemic has not had a material impact on the Company, particularly due to our current lack of operations. The pandemic may, however, have an impact on our ability to evaluate and acquire an operating entity through a reverse merger or otherwise.

 

Off-Balance Sheet Arrangements

 

None.

 

3

 

 

Results of Operations

 

Three Months Ended March 31, 2024 Compared to Three Months Ended March 31, 2023

 

The following table summarizes our results of operations for the three months ended March 31, 2024 and 2023:

 

   Three Months Ended March 31, 
   2024   2023   Change $ 
             
Revenues  $23,003   $169,111   $(146,108)
                
Cost of revenues   -    36,701    (36,701)
    23,003    132,410    (109,407)
                
Operating Expenses:               
General and administrative   1,501,932    183,603    1,318,329 
Sales and marketing   13,975    -    13,975 
Total Operating Expenses   1,515,907    183,603    1,332,304 
Net operating income (loss)   (1,492,904)   (51,193)   (1,441,711)
                
Other Income (Expenses):               
Interest income   102    741    (639)
Interest expense   (3,185)   (1,888)   (1,298)
Net Other Income (Expenses)   (3,083)   (1,147)   (1,937)
Income (loss) before income taxes   (1,495,987)   (52,340)   (1,443,648)
Income taxes   -    -    - 
Net income (loss)  $(1,495,987)  $(52,340)  $(1,443,648)

 

Revenues and Cost of Revenues

 

During the three months ended March 31, 2024 and 2023, the Company had revenues of approximately $23,000 and $169,000, respectively. During the quarter ended March 31, 2024, the Company reported revenues of $23,003 from the BUFFALOED CAMA. Revenues during the 2023 period were derived from contracts with customers for consulting services.

 

General and Administrative Expenses

 

General and administrative expenses for the three months ended March 31, 2024 were approximately $1,502,000 compared to approximately $184,000 for the three months ended March 31, 2023, an increase of approximately $1.3 million. The increase was primarily attributable to the Company recording $1,258,160 of stock option compensation expense in the quarter ended March 31, 2024. As a public company, we expect general and administrative costs to continue to increase in future periods.

 

Sales and Marketing Expenses

 

Sales and marketing expenses for the three months ended March 31, 2024 were approximately $14,000 compared to $0 for the three months ended March 31, 2023. Sales and marketing expenses relate to our engagement of a part-time marketing consultant during the quarter and related expenses.

 

4

 

 

Other Income (Expense)

 

Interest Income. Interest income for the three months ended March 31, 2024 and 2023 was minimal and consisted of interest earned on invested cash balances.

 

Interest Expense. Interest expense for the three months ended March 31, 2024 and 2023 was approximately $3,200 and $1,900, respectively, and was primarily related to our Economic Injury Disaster Loan (“EIDL”) and working capital loans.

 

Liquidity and Capital Resources

 

During the quarter ended March 31, 2024, the Company sold 75,000 shares of Common Stock at $0.20 per share to new investors resulting in total proceeds of approximately $15,000.

 

We had an accumulated deficit of approximately $6.5 million, incurred a net loss of approximately $1.5 million, and had cash outflows from operations of approximately $436,000 as of and for the three months ended March 31, 2024. Further, we expect to continue to incur significant costs in the pursuit of our business plans. We cannot assure you that our plans to raise capital or to complete our film development and production activities will be successful. These factors, among others, raise substantial doubt about our ability to continue as a going concern.

 

Since our inception, we have incurred significant operating losses. We expect to incur significant expenses and operating losses for the foreseeable future as we develop and produce feature films. To date, we have funded our operations with proceeds from sales of Common Stock and borrowings from related parties under promissory notes. As of March 31, 2024, we had cash and cash equivalents of approximately $25,000.

 

Operating Activities

 

During the three months ended March 31, 2024, operating activities used approximately $436,000 of cash, including providing a $220,000 of financing to a film production company and payments resulting in a $42,000 reduction in accounts payable and accrued expenses.

 

During the three months ended March 31, 2023, operating activities consumed approximately $130,000 of cash, primarily resulting from $52,000 operating loss and payment of approximately $42,000 in accounts payable and accrued expenses.

 

Investing Activities

 

During the three months ended March 31, 2024 and 2023, investing activities included approximately $5,000 and $10,000 of produced and licensed film production costs. Additionally, during the quarter ended March 31, 2024, the Company invested approximately $3,000 in capitalized software.

 

Financing Activities

 

During the three months ended March 31, 2024, net cash provided by financing activities was approximately $265,000 including $15,000 of proceeds from the sale of Common Stock and $250,000 of working capital financing under a master loan agreement from a related party.

 

During the three months ended March 31, 2023, net cash provided by financing activities was $125,000 comprised of working capital financing under a master loan agreement from a related party.

 

5

 

 

ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

 

There have been no material changes to our market risk during the first quarter of 2024. For a discussion of our exposure to market risk, please see Part II, Item 7A, “Quantitative and Qualitative Disclosures About Market Risk” of our 2023 Form 10-K.

 

ITEM 4. CONTROLS AND PROCEDURES

 

(a) Disclosure Controls and Procedures.

 

Our management, with the participation of our Chief Executive Officer and Chief Financial Officer, has evaluated the effectiveness of our disclosure controls and procedures (as such term is defined in Rules 13a-15(e) and 15d-15(e) under the Exchange Act) as of March 31, 2024, or the Evaluation Date. Based on such evaluation, those officers have concluded that, as of the Evaluation Date, our disclosure controls and procedures are ineffective in recording, processing, summarizing and reporting, on a timely basis, information required to be included in periodic filings under the Exchange Act and that such information is not accumulated and communicated to management, including our principal executive and financial officers, in a manner sufficient to allow timely decisions regarding required disclosure, due to lack of sufficient internal accounting personnel, segregation of duties, lack of sufficient internal controls (including IT general controls) that encompass the Company as a whole with respect to entity and transactions level controls in order to ensure complete documentation of complex and non-routine transactions and adequate financial reporting.

 

Management has identified corrective actions to remediate such material weaknesses, and subject to fundraising, which includes hiring additional employees. Management intends to implement procedures to remediate such material weaknesses during the fiscal year 2024; however, the implementation of these initiatives may not fully address any material weakness or other deficiencies that we may have in our disclosure controls and procedures.

 

  (b) Changes in Internal Control over Financial Reporting.

 

During the quarter ended March 31, 2024, there were no changes in our internal control over financial reporting that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

 

PART II - OTHER INFORMATION

 

ITEM 1. LEGAL PROCEEDINGS

 

We may from time to time be involved in various claims and legal proceedings of a nature we believe are normal and incidental to our business. These matters may include product liability, intellectual property, employment, personal injury cause by our employees, and other general claims. Aside from the following, we are not presently a party to any legal proceedings that, in the opinion of our management, are likely to have a material adverse effect on our business. Regardless of outcome, litigation can have an adverse impact on us because of defense and settlement costs, diversion of management resources and other factors.

 

Pending Legal Proceeding(s).

 

Randall S. Sprung v. Bannor Michael MacGregor, Jeffery Katz, and Life Design Station International, Inc. – Supreme Court of New York, County of Kings, Index No.: 504677/2019

 

This action instituted by Randall Sprung against the Defendants on March 4, 2019, to recover monies he alleges are owed by Defendants (Counter-Plaintiffs) pursuant to written agreements to purchase shares and to provide consulting services between the parties. Defendants Bannor Michael MacGregor and Life Design Station International, Inc. (“LDSI”) (Counter-Plaintiffs) have filed counterclaims to recover damages they have incurred as a direct result of Sprung’s failure to properly perform his obligations and duties under the written agreement between the parties.

 

In February 2022, Plaintiff Sprung passed away. On May 25, 2023, the Court entered an Order substituting David Sprung, as Administrator of the Estate of Randall S. Sprung, for Randall S. Sprung as Defendant in the action.

 

While the case was filed in March 2019, due to the COVID-19 pandemic and the death of the Plaintiff, it is still in the preliminary stages. The Defendants will continue to pursue their counterclaims and to defend against Plaintiff’s claims vigorously.

 

6

 

 

ITEM 1A. RISK FACTORS

 

There have been no material changes to our risk factors from those disclosed in “Part I, Item 1A. Risk Factors” of our 2023 Form 10-K.

 

ITEM 2. UNREGISTERED SALES OF EQUITY SECURITIES USE OF PROCEEDS

 

There are no transactions that have not been previously included in a Current Report on Form 8-K.

 

ITEM 3. DEFAULTS UPON SENIOR SECURITIES

 

Not applicable.

 

ITEM 4. MINE SAFETY DISCLOSURES.

 

Not applicable.

 

ITEM 5. OTHER INFORMATION

 

Not applicable.

 

ITEM 6. EXHIBITS INDEX

 

3.1 Amended and Restated Articles of Incorporation
3.2 Bylaws
3.3 Devil’s Half-Acre Articles of Organization
3.4 Ask Christine Articles of Organization
10.1 Consulting Agreement with Bannor Michael MacGregor
10.1.1 Amended Consulting Agreement with Bannor Michael MacGregor
10.2 Economic Injury Disaster Loan (EIDL)
10.3 American Express Business Line of Credit Loan Agreement and Personal Guarantee
10.4 2023 Directors, Employees and Advisors Stock Incentive and Compensation Plan
10.5 Asset Purchase Agreement with Bold Crayon
10.6 Devil’s Half-Acre Agreement
10.6.1 Devil’s Half-Acre Addendum
10.7 Ask Christine Screenplay Options Purchase Agreement
10.8 Master Loan Agreement between APHP and Bannor MacGregor
10.9 PNP Senior Loan Agreement
10.9.1 Addendum to PNP Agreement
10.10 Barron’s Cove Loan Agreement

10.10.1

Addendum to Barron’s Cove Agreement 10.8

14.1 Code of Ethics
14.2 Code of Ethics For Executive Officers
31.1 Rule 13(a)-14(a)/15(d)-14(a) Certification of principal executive officer
31.2 Rule 13(a)-14(a)/15(d)-14(a) Certification of principal financial officer
32.1 Section 1350 Certification of principal executive officer
32.2 Section 1350 Certification of principal financial officer and principal accounting officer

 

7

 

 

AMERICAN PICTURE HOUSE CORPORATION

SIGNATURES

 

Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

 

  AMERICAN PICTURE HOUSE CORPORATION
     
  By: /s/ Bannor Michael MacGregor
  Name: Bannor Michael MacGregor
  Title: Chief Executive Officer
  Dated: May 14, 2024

 

By: /s/ Daniel Hirsch   Treasurer   May 14, 2024

 

8

  

 

Exhibit 3.1

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Exhibit 3.2

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Exhibit 3.3

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Exhibit 3.4

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Exhibit 10.1

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Exhibit 10.1.1

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Exhibit 10.2

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Exhibit 10.3

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Exhibit 10.4

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Exhibit 10.5

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Exhibit 10.6

 

 

 

 

 

 

 

 

 

 

 

Exhibit 10.6.1

 

 

 

 

 

 

 

 

 

 

 

 

Exhibit 10.7

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Exhibit 10.8

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Exhibit 10.9

 

 

 
 

 

 

 
 

 

 

 
 

 

 

 
 

 

 

 
 

 

 

 
 

 

 

 
 

 

 

 
 

 

 

 

 

 

Exhibit 10.9.1

 

 

 
 

 

 

 

 

 

Exhibit 10.10

 

 

 
 

 

 

 
 

 

 

 
 

 

 

 
 

 

 

 
 

 

 

 
 

 

 

 
 

 

 

 

 

 

Exhibit 10.10.1

 

 

 

 

 

Exhibit 14.1

 

 

 
 

 

 

 
 

 

 

 
 

 

 

 
 

 

 

 

 

 

Exhibit 14.2

 

 

 
 

 

 

 
 

 

 

 

 

 

Exhibit 31.1

 

CERTIFICATIONS

 

I, Bannor Michael MacGregor, certify that:

 

1. I have reviewed this quarterly report on Form 10-Q of American Picture House Corp.;

 

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 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.

 

Date: May 13, 2024

 

  By: /s/ Bannor Michael MacGregor
    Bannor Michael MacGregor
    Chief Executive Officer

 

 

 

Exhibit 31.2

 

CERTIFICATIONS

 

I, Daniel Hirsch, certify that:

 

1. I have reviewed this quarterly report on Form 10-Q of American Picture House Corp.;

 

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 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.

 

Date: May 13, 2024

 

  By: /s/ Daniel Hirsch
    Daniel Hirsch
    Treasurer

 

 

 

Exhibit 32.1

 

Rule 13a-14(a)/15d-14(a)

Certification of Chief Executive Officer

CERTIFICATION

 

I, Bannor M. MacGregor, certify that:

 

1. I have reviewed this quarterly report on Form 10-Q of American Picture House Corporation;

 

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 an 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.

 

Date: May 14, 2024  
   
/s/ Bannor Michael MacGregor  
Bannor Michael MacGregor  
Chairman and Chief Executive Officer  

 

 
 

 

Section 1350

Certification of Chief Executive Officer

 

Pursuant to 18 U.S.C. Section 1350, the undersigned officer of American Picture House Corporation (the “Company”), hereby certifies that the Company’s Annual Report on Form 10-Q for the period ended March 31, 2024 (the “Report”) fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934 and that the information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

 

Date: By: May 13, 2024  
   
/s/ Bannor Michael MacGregor  
Bannor Michael MacGregor  
Chairman and Chief Executive Officer  

 

 

 

Exhibit 32.2

 

Rule 13a-14(a)/15d-14(a)

Certification of Treasurer

CERTIFICATION

 

I, Daniel J. Hirsch, certify that:

 

1. I have reviewed this quarterly report on Form 10-Q of American Picture House Corporation;

 

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 an 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.

 

Date: May 14, 2024  
   
/s/ Daniel J. Hirsch  
Daniel J. Hirsch  
Treasurer  

 

 
 

 

Section 1350

Certification of Chief Executive Officer

 

Pursuant to 18 U.S.C. Section 1350, the undersigned officer of American Picture House Corporation (the “Company”), hereby certifies that the Company’s Annual Report on Form 10-Q for the period ended March 31, 2024 (the “Report”) fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934 and that the information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

 

Date: May 14, 2024  
   
/s/ Daniel J. Hirsch  
Daniel J. Hirsch  
Treasurer Officer  

 

 

v3.24.1.1.u2
Cover - shares
 3 Months Ended
Mar. 31, 2024
May 02, 2024
Cover [Abstract]    
Document Type 10-Q  
Amendment Flag false  
Document Quarterly Report true  
Document Transition Report false  
Document Period End Date Mar. 31, 2024  
Document Fiscal Period Focus Q1  
Document Fiscal Year Focus 2024  
Current Fiscal Year End Date --12-31  
Entity File Number 000-56586  
Entity Registrant Name American Picture House Corporation  
Entity Central Index Key 0001771995  
Entity Tax Identification Number 85-4154740  
Entity Incorporation, State or Country Code WY  
Entity Address, Address Line One 477 Madison Avenue, 6th Floor  
Entity Address, City or Town New York  
Entity Address, State or Province NY  
Entity Address, Postal Zip Code 10022  
City Area Code 1-800  
Local Phone Number 689-6885  
Entity Current Reporting Status Yes  
Entity Interactive Data Current Yes  
Entity Filer Category Non-accelerated Filer  
Entity Small Business true  
Entity Emerging Growth Company false  
Entity Shell Company false  
Entity Common Stock, Shares Outstanding   111,399,325
v3.24.1.1.u2
Condensed Consolidated Balance Sheets - USD ($)
Mar. 31, 2024
Dec. 31, 2023
Current Assets    
Cash and cash equivalents $ 25,126 $ 203,971 [1]
Accounts receivable 51,775 31,948 [1]
Prepaid expenses 13,367 29,185 [1]
Total Current Assets 90,889 266,453 [1]
Produced and licensed content costs 200,403 210,633 [1]
Loans receivable, film financing arrangements 220,000 [1]
Intangible assets, net of accumulated amortization of $1,750 and $1,000 as of March 31, 2024 and December 31, 2023, respectively. 74,114 71,864 [1]
IMM loans receivable, net of allowance of $366,387 [1]
TOTAL ASSETS 585,406 548,950 [1]
Current Liabilities    
Accounts payable and accrued expenses 48,710 90,377 [1]
Deferred revenue, current portion 50,000 [1]
Total Current Liabilities 361,240 101,957 [1]
Economic injury disaster loan, non-current 149,900 149,900 [1]
Total Liabilities 511,140 251,857 [1]
Stockholders’ Equity (Deficit):    
Common Stock $0.0001 par value. 1,000,000,000 authorized. 109,865,991 and 109,790,991 issued and outstanding as of March 31, 2024 and December 31, 2023, respectively. 471,577 471,569 [1]
Preferred Stock $0.0001 par value. 1,000,000 authorized. 3,829 issued and outstanding as of March 31, 2024 and December 31, 2023. [1]
Additional paid in capital 6,120,372 4,847,220 [1]
Accumulated deficit (6,517,683) (5,021,696) [1]
Total Stockholders’ Equity (Deficit) 74,266 297,093 [1]
TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY (DEFICIT) 585,406 548,950 [1]
Related Party [Member]    
Current Assets    
Accounts receivable 1,775
Receivable - related party 621 1,349 [1]
Current Liabilities    
Interest payable - EIDL loan 1,641 [1]
Note payable - related party 250,000 [1]
Nonrelated Party [Member]    
Current Liabilities    
Interest payable - EIDL loan $ 10,889 $ 11,580 [1]
[1] Derived from audited information
v3.24.1.1.u2
Condensed Consolidated Balance Sheets (Parenthetical) - USD ($)
Mar. 31, 2024
Dec. 31, 2023
Statement of Financial Position [Abstract]    
Intangible assets, net of accumulated amortization $ 1,750 $ 1,000
Net of allowance for loans receivable $ 366,387 $ 366,387
Common stock, par value $ 0.0001 $ 0.0001
Common stock, shares authorized 1,000,000,000 1,000,000,000
Common stock, shares issued 109,865,991 109,790,991
Common stock, shares outstanding 109,865,991 109,790,991
Preferred stock, par value $ 0.0001 $ 0.0001
Preferred stock, shares authorized 1,000,000 1,000,000
Preferred stock, shares issued 3,829 3,829
Preferred stock, shares outstanding 3,829 3,829
v3.24.1.1.u2
Condensed Consolidated Statements of Operations (Unaudited) - USD ($)
 3 Months Ended
Mar. 31, 2024
Mar. 31, 2023
Income Statement [Abstract]    
Revenues $ 23,003 $ 169,111
Cost of revenues 36,701
Gross profit 23,003 132,410
Operating Expenses:    
General and administrative 1,501,932 183,603
Sales and marketing 13,975
Total Operating Expenses 1,515,907 183,603
Net Operating Loss (1,492,904) (51,193)
Other Income (Expenses):    
Interest income 102 741
Interest expense (3,185) (1,888)
Net Other Income (Expenses) (3,083) (1,147)
Loss before income taxes (1,495,987) (52,340)
Income taxes
Net loss $ (1,495,987) $ (52,340)
Net loss per common share - Basic $ (0.01) $ (0.00)
Net loss per common share - Diluted $ (0.01) $ (0.00)
Weighted average shares used in per share computation - Basic 109,865,001 100,735,159
Weighted average shares used in per share computation - Diluted 109,865,001 100,735,159
v3.24.1.1.u2
Condensed Consolidated Statements of Changes In Deficit (Unaudited) - USD ($)
Total
Common Stock [Member]
Preferred Stock [Member]
Additional Paid-in Capital [Member]
Retained Earnings [Member]
Balance at Dec. 31, 2022 $ (67,756) $ 10,074 $ 3,577,548 $ (3,655,378)
Balance, shares at Dec. 31, 2022   100,735,159 3,829    
Conversion of accrued liabilities totaling $105,000 into options to purchase 1,160,221 shares of Common Stock 105,000 105,000
Net Loss (52,340) (52,340)
Balance at Mar. 31, 2023 (15,096) $ 10,074 3,682,548 (3,707,718)
Balance, shares at Mar. 31, 2023   100,735,159 3,829    
Balance at Dec. 31, 2023 297,093 [1] $ 10,979 5,307,810 (5,021,696)
Balance, shares at Dec. 31, 2023   109,790,991 3,829    
Issuance of Common Stock for cash 15,000 $ 8 14,992
Issuance of Common Stock, shares   75,000      
Stock option compensation 1,258,160 1,258,160
Net Loss (1,495,987) (1,495,987)
Balance at Mar. 31, 2024 $ 74,266 $ 10,987 $ 6,580,962 $ (6,517,683)
Balance, shares at Mar. 31, 2024   109,865,991 3,829    
[1] Derived from audited information
v3.24.1.1.u2
Condensed Consolidated Statements of Changes In Deficit (Unaudited) (Parenthetical)
 3 Months Ended
Mar. 31, 2023
USD ($)
shares
Supplemental Cash Flow Elements [Abstract]  
Conversion of accrued liabilities | $ $ 105,000
Conversion of accrued liabilities, shares | shares 1,160,221
v3.24.1.1.u2
Condensed Consolidated Statements of Cash Flows (Unaudited) - USD ($)
 3 Months Ended 12 Months Ended
Mar. 31, 2024
Mar. 31, 2023
Dec. 31, 2023
Cash Flows from Operating Activities:      
Net Income (Loss) $ (1,495,987) $ (52,340)  
Adjustments to Reconcile Net Income (Loss) to Net Cash Flows from Operating Activities:      
Expiration of produced and licensed costs 15,000  
Stock option expense 1,258,160  
Amortization expense 750  
Change in operating assets and liabilities:      
Accounts receivable (19,827) 109,702  
Prepaid expenses 15,818 17,838  
Other receivables 168  
Receivables - related party 728  
Loans receivable, film financing arrangements (220,000)  
Accounts payable and accrued expenses (41,667) (41,783)  
Payable to related party (130,000)  
Deferred revenue 50,000 (35,000)  
Net Cash Flows from Operating Activities (436,075) (129,918)  
Cash Flows from Investing Activities:      
Produced and licensed costs (4,770) (10,016)  
Intangible assets (3,000)  
Net Cash Flows from Investing Activities (7,770) (10,016)  
Cash Flows from Financing Activities:      
Proceeds from debt borrowings - related parties 250,000 125,000 $ 178,500
Proceeds from sale of Common Stock 15,000  
Net Cash Flows from Financing Activities 265,000 125,000  
Net Increase in Cash and Cash Equivalents (178,845) (14,934)  
Cash and Cash Equivalents, Beginning of Period 203,971 31,573 31,573
Cash and Cash Equivalents, End of Period 25,126 16,639 $ 203,971
Non-cash Financing and Investing Activities:      
Conversion of accrued expenses into options to purchase Common Stock 105,000  
Related Party [Member]      
Change in operating assets and liabilities:      
Interest payable - EIDL loan 1,641 111  
EIDL Loan [Member]      
Change in operating assets and liabilities:      
Interest payable - EIDL loan $ (691) $ 1,386  
v3.24.1.1.u2
Organization And Description Of Business
 3 Months Ended
Mar. 31, 2024
Accounting Policies [Abstract]  
Organization And Description Of Business

NOTE 1 – Organization And Description Of Business

 

American Picture House Corporation. (“the Company,” “we” “us”) was incorporated in the State of Nevada on September 21, 2005, originally under the corporate name of Servinational, Inc. The Company subsequently changed its name to Shikisai International, Inc. in November 2005 and then to Life Design Station, Intl., Inc. in August 2007. The Company changed its state of domicile from Nevada to Wyoming on October 13, 2020. On December 4, 2020, the Company changed its name to American Picture House Corporation.

 

The Company’s year-end is December 31.

 
v3.24.1.1.u2
Summary Of Significant Accounting Policies
 3 Months Ended
Mar. 31, 2024
Accounting Policies [Abstract]  
Summary Of Significant Accounting Policies

NOTE 2 – Summary Of Significant Accounting Policies

 

Basis of Presentation

 

The accompanying financial statements have been prepared in accordance with the Financial Accounting Standards Board (“FASB”) “FASB Accounting Standard Codification™” (the “Codification”) which is the source of authoritative accounting principles recognized by the FASB to be applied by nongovernmental entities in the preparation of financial statements in conformity with accepted accounting principles (“GAAP”) in the United States.

 

Principles of Consolidation

 

The condensed consolidated financial statements of the Company include the accounts of American Picture House Corporation and its wholly owned subsidiaries, Devil’s Half-Acre, LLC and Ask Christine Productions, LLC.

 

Going Concern

 

The accompanying financial statements have been prepared assuming the Company will continue as a going concern, which contemplates the realization of assets and the satisfaction of liabilities in the normal course of business for the twelve months following the date of these financial statements. As of March 31, 2024, the Company had a working capital deficit of ($270,351) and an accumulated deficit of $6,517,683.

 

Because the Company does not expect that the existing operational cash flow will be sufficient to fund presently anticipated operations, this raises substantial doubt about the Company’s ability to continue as a going concern. Therefore, the Company will need to raise additional funds and is currently exploring alternative sources of financing. Recently the Company has been funded by related party shareholders and officers. Historically, the Company raised capital through private placements, to finance working capital needs and may attempt to raise capital through the sale of common stock or other securities and obtaining some short-term loans. The Company will be required to continue to do so until its operations become profitable. Also, the Company has, in the past, paid for consulting services with its common stock to maximize working capital, and intends to continue this practice where feasible.

 

Use of Estimates

 

The preparation of financial statements in conformity with US GAAP requires management to make estimates and assumptions that affect the reported amounts of liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. The most significant estimates relate to income taxes and contingencies. The Company bases its estimates on historical experience, known or expected trends, and various other assumptions that are believed to be reasonable given the quality of information available as of the date of these financial statements. The results of these assumptions provide the basis for making estimates about the carrying amount of assets and liabilities that are not readily apparent from other sources. Actual results could differ from these estimates.

 

 

Cash and cash equivalents

 

Cash equivalents are short-term highly liquid investments which include short term bank deposits (up to three months from date of deposit), that are not restricted as to withdrawals or use that are readily convertible to cash with maturities of three months or less as of the date acquired. The Company’s policy is to maintain its cash balances with financial institutions with high credit ratings and in accounts insured by the Federal Deposit Insurance Corporation (the “FDIC”) and/or by the Securities Investor Protection Corporation (the “SIPC”). The Company may periodically have cash balances in financial institutions in excess of the FDIC and SIPC insurance limits of $250,000 and $500,000, respectively. The Company has not experienced any losses to date resulting from this policy.

 

Accounts receivable

 

Accounts receivable primarily consist of trade receivables due from customers for consulting services and from fees derived from licensing of IP to content providers worldwide. As of March 31, 2024, $50,000 (97%) of accounts receivable were related to the grant of a producer credit in a proposed future film. As of December 31, 2023, 100% of accounts receivable were due from the BUFFALOED CAMA (see Assigned Rights to feature film, BUFFALOED below).

 

   March 31, 2024   December 31, 2023 
Accounts receivable, trade  $50,000   $- 
Accounts receivable, related party   1,775    - 
Accounts receivable, CAMA   -    31,948 
Accounts receivable   $51,775   $31,948 

 

Allowance for doubtful accounts

 

The allowance for doubtful accounts is determined with respect to amounts the Company has determined to be doubtful of collection. In determining the allowance for doubtful accounts, the Company considers, among other things, its past experience with customers, the length of time that the balance is past due, the customer’s current ability to pay and available information about the credit risk on such customers. In 2023, the Company wrote off $193,932 of receivables as bad debt based on a review of the customer’s ability to pay, the customer’s Managing Director resigning, and the customer ceasing operations. There was no bad debt expense during the quarter ended March 31, 2024 and no allowance for doubtful accounts at March 31, 2024 or December 31, 2023.

 

Prepaid expenses

 

At March 31, 2024, prepaid expenses consisted of prepaid insurance, prepaid licenses, and prepaid services. Prepaid expenses are amounts paid to secure the use of assets or the receipt of services at a future date or continuously over one or more future periods. When the prepaid expenses are eventually consumed, they are charged to expense. The Company had $13,367 and $29,185 in prepaid expenses as of March 31, 2024 and December 31, 2023, respectively.

 

Produced and Licensed Content Costs

 

Capitalized production costs, whether produced or acquired/ licensed rights, include development costs, direct costs and production overhead. These amounts and licensed content are included in “Produced and Licensed Content Costs” on the balance sheet as follows:

 

   March 31, 2024   December 31, 2023 
Films in development and pre-production stage  $200,403   $210,633 
   $200,403   $210,633 

 

 

Impairment Assessment for Investment in Films and Licensed Program Rights

 

A film group or individual film is evaluated for impairment when an event or change in circumstances indicates that the fair value of an individual film or film group is less than its unamortized cost.

 

During the quarter ended March 31, 2024, the Company allowed options to two screenplays to expire and wrote-off $15,000 of previously capitalized option costs.

 

Assigned rights to the feature film, BUFFALOED.

 

In November 2022, the Company obtained certain limited rights to the feature film BUFFALOED from Bold Crayon, Inc. (“BC”), including a secured position of a one million three hundred eighty-thousand-dollar ($1,380,000.00 USD) receivable against the film’s revenues as per the film’s Cash Asset Management Agreement (“CAMA”) and a 35% share of the profits generated thereafter (“the BC Assets”). During the quarters ended March 31, 2024 and 2023, the Company reported revenues of $23,003 and $0, respectively, from the CAMA. Inception to date, the Company has received $304,875 under the CAMA. Due to uncertainties of any future revenue, if any, no value has been assigned to any potential future revenues.

 

As partial consideration for the BC Assets being acquired by APH hereunder, APHP agreed to pay BC the first one hundred thirty thousand dollars ($130,000.00 USD) that APHP collected from the BUFFALOED and to deliver one Preferred Share to BC for each ten thousand dollars ($10,000.00 USD), in value paid to the APHP from the BUFFALOED receivable above the one hundred thirty thousand dollars ($130,000.00 USD), not to exceed one hundred twenty-five (125) Preferred Shares. As of March 31, 2024, Bold Crayon was due to receive 17 Preferred Shares of APHP.

 

Intangible assets

 

The Company’s intangible assets include in-service and under-development websites and licensed internal use software. During the year ended December 31, 2023 the Company developed an external website that was placed in service during the third quarter of 2023. Additionally, during the fourth quarter of 2023 the Company began developing additional aspects of its website that went live in April 2024. During the fourth quarter of 2023, the Company licensed rights to new internal use software, but subsequently placed that project on hold and has not established a timeline for placing the software in service.

 

The capitalized costs of the Company’s websites placed into service were subject to straight-line amortization over a three-year period. Amortization expense totaled $$750 and $0 for the quarters ended March 31, 2024 and 2023, respectively.

 

Deferred Revenue

 

Deferred revenue represents the amount billed to clients that has not yet been earned, pursuant to agreements entered into in current and prior periods. As of March 31, 2024 and December 31, 2023, total net deferred revenue was $50,000 and $0, respectively. As previously noted, the $50,000 in deferred revenue at March 31, 2024, relates to the grant of a producer credit to a proposed film.

 

Revenues and Costs from Services and Products – Historically, Company’s revenue comes from contracts with customers for consulting services and from the licensing and distribution of film and other entertainment rights. The consulting services typically relate to development of business strategy and monetization of intellectual property rights. The Company accounts for a contract with a customer when there is an enforceable contract between the Company and the customer, the rights of the party are identified, the contract has economic substance, and collectability of the contract is considered probable. Historically, the term of these consulting agreements has been approximately three to six months in duration. The Company’s revenue is measured based on considerations specified in the contract with each customer. Accounting Standards Codification (“ASC”) 606 allows for adoption of an “as invoiced” practical expedient that allows companies to recognize revenue in the amount to which the entity has a right to invoice when they have a right to consideration from a customer in an amount that corresponds directly with the value to the customer of the entity’s performance completed to date. The Company has elected to adopt this practical expedient with regards to its consulting services revenue. Revenues for the three months ended March 31, 2023 totaled $165,000. As discussed in Note 10 – Related Party Transactions, $35,000 of the revenue was from Ribo Music and the remaining $135,000 was from a second client. The Company did not have any consulting revenues in 2024.

 

 

Revenues from Films and Licensed Rights, are calculated based on expected ultimate revenues estimated over a period not to exceed ten years following the date of initial release of the motion picture. For an episodic television series, the period over which ultimate revenues are estimated cannot exceed ten years following the date of delivery of the first episode, or, if still in production, five years from the date of delivery of the most recent episode, if later. For titles included in acquired libraries, ultimate revenue includes estimates over a period not to exceed twenty years following the date of acquisition.

 

Revenue derived from the BUFFALOED CAMA totaled $23,003 and $0 for the quarters ended March 31, 2024 and 2023, respectively.

 

Fair Value Measurements – The Company measures and discloses fair value in accordance with the ASC Topic 820, Fair Value Measurements and Disclosures which defines fair value, establishes a framework and gives guidance regarding the methods used for measuring fair value, and expands disclosures about fair value measurements. Fair value is an exit price, representing the amount that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. As such, fair value is a market-based measurement that should be determined based on assumptions that market participants would use in pricing an asset or liability. As a basis for considering such assumptions there exists a three-tier fair-value hierarchy, which prioritizes the inputs used in measuring fair value as follows:

 

Level 1 - unadjusted quoted prices are available in active markets for identical assets or liabilities that the Company has the ability to access as of the measurement date.

 

Level 2 - pricing inputs are other than quoted prices in active markets that are directly observable for the asset or liability or indirectly observable through corroboration with observable market data.

 

Level 3 - pricing inputs are unobservable for the non-financial asset or liability and only used when there is little, if any, market activity for the non-financial asset or liability at the measurement date. The inputs into the determination of fair value require significant management judgment or estimation. Level 3 inputs are considered as the lowest priority within the fair value hierarchy. The valuation of the right to obtain control over affiliated company, right to acquire shares of other companies, contingent consideration to be paid upon achieving of performance milestone, certain convertible bridge loans (following the maturity date and thereafter) and certain freestanding stock warrants and bifurcated convertible feature of convertible bridge loans issued to the units’ owners, fall under this category.

 

This hierarchy requires the Company to use observable market data, when available, and to minimize the use of unobservable inputs when determining fair value.

 

The fair value of cash and cash equivalents is based on its demand value, which is equal to its carrying value. Additionally, the carrying value of all other short-term monetary assets and liabilities are estimated to be equal to their fair value due to the short-term nature of these instruments.

 

Valuation of Long-Lived Assets – The Company evaluates whether events or circumstances have occurred which indicate that the carrying amounts of long-lived assets (principally produced and licensed content costs) may be impaired or not recoverable. The significant factors that are considered that could trigger an impairment review include: changes in business strategy, market conditions, or the manner of use of an asset; underperformance relative to historical or expected future operating results; and negative industry or economic trends. In evaluating an asset for possible impairment, management estimates that asset’s future undiscounted cash flows and appraised values to measure whether the asset is recoverable. The Company measures the impairment based on the projected discounted cash flows of the asset over its remaining life.

 

 

Stock-Based Compensation – The Company follows U.S. GAAP, which requires all stock-based compensation to employees, including the grant of employee stock options, to be recognized in the statement of operations based on its fair value. Awards outstanding are accounted for using the accounting principles originally applied to the award. The expense associated with share-based compensation is recognized on a straight-line basis over the service period of each award. Refer to Note 8 for additional information related to this stock-based compensation plan.

 

Income taxes

 

The Company accounts for income taxes under FASB ASC 740, “Accounting for Income Taxes”. Under FASB ASC 740, deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. Under FASB ASC 740, the effect on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period that includes the enactment date. FASB ASC 740-10-05, “Accounting for Uncertainty in Income Taxes” prescribes a recognition threshold and a measurement attribute for the financial statement recognition and measurement of tax positions taken or expected to be taken in a tax return. For those benefits to be recognized, a tax position must be more-likely-than-not to be sustained upon examination by taxing authorities.

 

The amount recognized is measured as the largest amount of benefit that is greater than 50 percent likely of being realized upon ultimate settlement. The Company assesses the validity of its conclusions regarding uncertain tax positions quarterly to determine if facts or circumstances have arisen that might cause it to change its judgment regarding the likelihood of a tax position’s sustainability under audit.

 

Net Loss per Share

 

Basic (loss) income per share is computed by dividing net (loss) income available to Common Stockholders by the weighted average number of common shares outstanding during the period. Diluted (loss) income per share reflects the potential dilution, using the treasury stock method that could occur if securities or other contracts to issue Common Stock were exercised or converted into Common Stock or resulted in the issuance of Common Stock that then shared in the (loss) income of the Company. In computing diluted (loss) income per share, the treasury stock method assumes that outstanding instruments are exercised/converted, and the proceeds are used to purchase Common Stock at the average market price during the period. Instruments may have a dilutive effect under the treasury stock method only when the average market price of the Common Stock during the period exceeds the exercise price/conversion rate of the instruments.

 

The following common share equivalents are excluded from the calculation of weighted average common shares outstanding because their inclusion would have been anti-dilutive:

 

   March 31, 2024   December 31, 2023 
Convertible Preferred Stock   382,900,000    382,900,000 
Options to Purchase Common Stock   5,083,471      
           
    387,983,471    382,900,000 

 

Segment Information

 

Operating segments are defined as components of an enterprise about which separate discrete information is available for evaluation by the chief operating decision maker (“CODM”), or decision-making group, in deciding how to allocate resources and in assessing performance. For the period of these financial statements, the CEO of the Company was the CODM. The Company views its operations and manages its business as one operating and reporting segment.

 

New accounting standards

 

The Company’s management has evaluated all the recently issued, but not yet effective, accounting standards and guidance that have been issued or proposed by the FASB or other standards-setting bodies through the filing date of these financial statements and does not believe the future adoption of any such pronouncements will have a material effect on the Company’s financial position and results of operations.

 

 
v3.24.1.1.u2
Liquidity and Going Concern
 3 Months Ended
Mar. 31, 2024
Organization, Consolidation and Presentation of Financial Statements [Abstract]  
Liquidity and Going Concern

Note 3 – Liquidity and Going Concern

 

The Company’s financial statements are prepared using account principles generally accepted in the United States (“U.S. GAAP”) applicable to a going concern, which contemplates the realization of assets and liquidation of liabilities in the normal course of business. As of March 31, 2024, the Company had a working capital deficit of ($270,351) and an accumulated deficit of $6,517,683. These factors, among others, raise doubt about the Company’s ability to continue as a going concern. The accompanying financial statements do not include adjustments to reflect the possible future effects on the recoverability and classification of assets or the amounts and classification of liabilities that may result from an inability of the Company to continue as a going concern.

 

The Company has a limited operating history, which makes it difficult to evaluate current business and future prospects. During 2023, the Company reported $169,111 of service revenues, down from $461,174 in 2023 and no revenues in 2021 and 2020. Management expects the Company to incur further losses in the foreseeable future due to costs associated with content acquisition and production, the cost of on-going litigation, and costs associated with being a public company. There can be no assurance that our operations will ever generate sufficient revenues to fund continuing operations, or that we will ever generate positive cash flow from our operations, or that we will attain or thereafter sustain profitability in any future period. To mitigate this situation, the Company has loan agreements with the Company’s CEO and the Noah Morgan Private Family Trust, a trust controlled by the Company’s CEO, to fund its month-to-month cash flow needs. During the first quarter of 2024, the Company borrowed $250,000 from the trust pursuant to a master loan agreement that is due and payable in 2025. During 2023, the Company borrowed $178,500 from and repaid $178,500 to Mr. MacGregor pursuant to a master loan agreement. The master note agreements accrue interest at a rate of 4.4% due and payable in a lump sum upon maturity of the obligation. These notes are not convertible.

 
v3.24.1.1.u2
Film Production Loans
 3 Months Ended
Mar. 31, 2024
Film Production Loans  
Film Production Loans

NOTE 4. Film Production Loans

 

Senior Mezzanine Loan Agreement with Barron’s Cove Movie, LLC

 

In February 2024, the Company loaned $200,000 to Barron’s Cove Movie, LLC pursuant to a Senior Mezzanine Loan Agreement. $20,000 of the loan proceeds will be used to pay producer fees, including $10,000 to Mr. MacGregor. The $200,00 loan, plus a premium of twenty percent (20%), is due and payable on that date which is the earlier of either (a) twelve (12) months from the date of the loan, or (b) from allocable proceeds received by Barron’s Cove Movie, LLC related to the movie, whichever occurs first.

 

Senior Loan Agreement with PNP Movie, LLC

 

In February 2024, the Company agreed to loan PNP Movie, LLC $97,475 to be used solely in connection with a named feature length motion picture. As of March 31, 2024, $20,000 had been advanced against this funding commitment. In April 2024, the loan agreement was amended whereby the Company agreed to lend an additional $42,525 and to use best efforts to increase the aggregate financing to $597,475. As of the date of this filing, a total of $195,000 had been advanced to PNP Movie, LLC. These loans, plus a premium of twenty percent (20%), is due and payable on that date which is the earlier of either (a) twelve (12) months from the date of the loan, or (b) from allocable proceeds received by PNP Movie, LLC related to the movie, whichever occurs first.

 

Additionally, the agreement states that Mr. MacGregor shall be entitled to a producer fee based on work to be performed and that Mr. MacGregor will receive a “Producer” credit and his son a “Co-Producer” credit on the film.

 

 
v3.24.1.1.u2
Intangible Assets
 3 Months Ended
Mar. 31, 2024
Goodwill and Intangible Assets Disclosure [Abstract]  
Intangible Assets

NOTE 5. Intangible Assets

 

The identifiable intangible assets consist of the following assets:

 

   March 31, 2024   December 31, 2023 
Website placed in service  $9,000   $9,000 
Website - under development   42,000    42,000 
Software – predeployment   24,864    21,684 
Intangible assets, gross   75,864    72,684 
           
Accumulated amortization   (1,750)   (1,000)
Intangible assets, net  $74,114   $71,684 

 

There were no impairment charges associated with the Company’s identifiable intangible assets during the quarters ended March 31, 2024 and 2023.

 

Amortization expense recorded in the accompanying consolidated statements of operations was $750 for the quarter year ended March 31, 2024. The Company did not own any intangible assets during the quarter-ended March 31, 2023.

 
v3.24.1.1.u2
Notes Payable
 3 Months Ended
Mar. 31, 2024
Debt Disclosure [Abstract]  
Notes Payable

Note 6 – Notes Payable

 

Note Payable – Mr. MacGregor

 

During the first quarter of 2023, the Company borrowed $125,500 from Mr. MacGregor pursuant to a master loan agreement dated March 1, 2023. The master note agreement accrues interest at a rate of 4.4% due and payable in a lump sum upon maturity of the obligation. This note is not convertible.

 

During the first quarter of 2024, the Company borrowed $250,000 from a trust managed by Mr. MacGregor pursuant to a master loan agreement dated February 6, 2024. The master note agreement accrues interest at a rate of 4.68% due and payable in a lump sum upon maturity of the obligation. This note is not convertible.

 

Noah Morgan Private Family Trust Loan Agreement (“NMPFT”)

 

On February 6, 2024, the Company entered into a master loan agreement with the NMPFT. The master note agreement accrues interest at a rate of 4.68%. Also during February 2024, the Company borrowed $250,000 pursuant to this loan agreement with this amount due and payable in a lump sum on February 6, 2025. This note is not convertible. $200,000 of these loan proceeds were used to fund the senior mezzanine loan to Barron’s Cove Movie, LLC as more fully described in Note 4 above.

 

Economic Injury Disaster Loan

 

In March 2021, the Company executed an Economic Injury Disaster Loan (“EIDL”) secured loan with the U.S. Small Business Administration under the EIDL program in the amount of $149,900. The loan is secured by all tangible and intangible assets of the Company and payable over 30 years at an interest rate of 3.75% per annum. Interest only installment payments commenced in September 2023.

 
v3.24.1.1.u2
Equity
 3 Months Ended
Mar. 31, 2024
Equity [Abstract]  
Equity

Note 7 – Equity

 

Common Stock

 

The Company has 1,000,000,000 common shares authorized. As of May 2, 2024, the Company has 111,399,325 shares issued and outstanding. As of May 2, 2024, the total number of shareholders of record was 331.

 

The Common Stock has a one share one voting right with no other rights. There are no provisions in the Company’s Articles of Incorporation, Articles of Amendment, or By-laws that would delay or prevent a change of control. The Board may from time to time declare, and the Company may pay, dividends on its shares in cash, property, or its own shares, except when the Corporation is insolvent, when the payment thereof would render the Company insolvent, subject to any preferential dividend rights of outstanding shares of preferred shares or when the declaration or payment thereof would be contrary to any other state law restrictions.

 

 

Preferred Stock

 

The Preferred Stock consists of 1,000,000 preferred shares authorized, of which 100,000 preferred shares have been designated as Series A Convertible Preferred Stock (“Series A preferred shares” herein). At present, 3,829 Series A preferred shares are issued and outstanding. The Series A preferred shares have the following rights: (i.) a first position lien against all of the Company’s assets including but not limited to the Company’s IP (“Intellectual Property”), (ii.) is convertible at a ratio of 1 to 100,000 so that each one share of Series A preferred stock may be exchanged for 100,000 Common Stock shares, (iii.) and that each share of Series A preferred stock shall carry superior voting rights to the Company’s Common Stock and that each share of Series A preferred stock shall be counted as 1,000,000 votes in any Company vote and (iv.) and any other benefits as deemed necessary and appropriate at the time of such issuance. The Preferred shares do not have any specific redemption rights or sinking fund provisions.

 

The “Liquidation Preference” with respect to a share of Series A preferred stock means an amount equal to the ratio of (i.) the total amount of the Company’s assets and funds available for distribution to the Series A preferred shares to (ii.) the number of shares of Series A preferred stock outstanding. The Series A preferred stock has a liquidation preference equal to $12.02 per preferred share.

 

Dividend Provisions

 

Subject to preferential dividend rights, if any, of the holders of Preferred Stock, dividends on the Common Stock may be declared by the Board of Directors and paid out of any funds legally available therefor at such times and in such amounts as the Board of Directors shall determine.

 
v3.24.1.1.u2
Equity Based Compensation
 3 Months Ended
Mar. 31, 2024
Share-Based Payment Arrangement [Abstract]  
Equity Based Compensation

Note 8– Equity Based Compensation

 

The American Picture House Corporation 2023 Directors, Employees and Advisors Stock Incentive and Compensation Plan (the “Plan”) was established in January 2023 to create an additional incentive to promote the financial success and progress of the Company. The Plan shall be administered by the Board of Directors and may grant options to purchase shares of the authorized but unissued Common Stock of the Company. The options may be either incentive stock options or nonqualified stock options.

 

The options granted under the Plan expire on the date determined by the Board of Directors and may not extend more than 10 years.

 

Under the Plan, unless the board specifies otherwise, stock options must be granted at an exercise price not less than the fair value of the Company’s Common Stock on the grant date. The aggregate fair value of incentive stock options held by any optionee shall not exceed $100,000.

 

The Board of Directors shall determine the terms and conditions of the options. The vesting requirements of all awards under the Plan may be time or event based and vary by individual grant. The incentive stock options and nonqualified stock options generally become exercisable over a two-year period. Vested and unexercised options may be available to be exercised no later than three months after termination of employment (or such longer period as determined by the Board of Directors).

 

Stock Option Grants

 

On February 8, 2024, the Company’s Board of Directors authorized the issuance of 250,000 options to each of its nine board members, 1,673,250 options to advisors, 662,983 options to Mr. Macgregor, and 497,238 options to Mr. Blanchard for an aggregate of 5,083,471 options with the rights to purchase common shares of the Company at an exercise price of $0.0125 per share. As all of the options vested 100% upon grant, the Company recorded $1,258,160 of stock option compensation expense in the quarter ended March 31, 2024. Share-based compensation expense is reported within General and Administrative expenses.

 

 
v3.24.1.1.u2
Contingencies and Uncertainties
 3 Months Ended
Mar. 31, 2024
Commitments and Contingencies Disclosure [Abstract]  
Contingencies and Uncertainties

Note 9 – Contingencies and Uncertainties

 

Risks and Uncertainties – The Company’s operations are subject to significant risks and uncertainties including financial, operational, and regulatory risks, including the potential risk of business failure. The Company does not have employment contracts with its key employees, including the controlling shareholders who are officers of the Company.

 
v3.24.1.1.u2
Related Party Transactions
 3 Months Ended
Mar. 31, 2024
Related Party Transactions [Abstract]  
Related Party Transactions

NOTE 10 – Related Party Transactions

 

The Company has agreed to indemnify Mr. MacGregor for all legal and professional costs originating from the lawsuit Randall S. Sprung v. Bannor Michael MacGregor, Jeffery Katz, and Life Design Station International, Inc. – Supreme Court of New York, County of Kings, Index No.: 504677/2019.

 

During the three months ended March 31, 2024 and 2023, the Company incurred approximately $45,000 and $30,000, respectively, of professional fees to a legal firm affiliated with a member of the Board of Directors.

 

The Company has consulting services relationships with members of the Board whereby they were compensated a total of $15,000 and $26,000 during the three months ended March 31, 2024 and 2023, respectively. As of March 31, 2024 and December 31, 2023, $0 and $20,000, respectively, were accrued and unpaid. The consulting services are provided as requested by management and may be terminated at any time with no penalty. On January 1, 2023, the $105,000 of the 2022 accrued consulting fees were exchanged for options to purchase 1,160,221 shares of Common Stock at $0.125 per share.

 

During 2022, the Company entered into consulting agreements with Ribo Music LLC aka Ribo Media (“Ribo Media”) whereby the Company assisted Ribo Media in developing an online media platform to deliver music and eventually movies directly to consumers via their smart devices. Revenues from the Ribo Media consulting services totaled $0 and $35,000, for the three months ended March 31, 2024 and 2023, respectively. As of March 31, 2024 and December 31, 2023, accounts receivable from Ribo Media totaled $1,775 and $0, respectively. Michael Blanchard, a director and shareholder of the Company and Timothy Battles, a director and shareholder of the Company, are both Managing Members and controlling shareholders in Ribo Media.

 

In August 2022, the Company funded Devil’s Half-Acre Productions, LLC owned by John Luessenhop to produce the feature film Devil’s Half-Acre written and directed by Dashiell Luessenhop, a son of A. John Luessenhop, a former Board member. In July 2023 APH obtained 100% ownership of Devil’s Half-Acre Productions, LLC and executed a new option agreement with the writer. In September 2023, APH paid a Five Thousand-Dollar (5,000) option fee to the writer. This option entitles APH to produce the film by July 2024, with the ability to extend the option for an additional two (2) years. As of March 31, 2024, the Company has capitalized $148,824 of production costs associated with this film.

 

During 2022, the Company entered into definitive agreements to secure Bold Crayon Corporation (“Bold Crayon” or “BC”) as a development partner and purchased certain assets from Bold Crayon, including a portion of the rights to a feature film, and copyrights on six film titles. The Parties agree that APHP will designate BC as a “Content Partner”, wherein BC will develop content and present APHP with a first opportunity to co-finance and/or coproduce content developed by BC subject to a mutually agreed upon Content Partner Agreement and BC will accept such designation. The Company anticipates any rights and obligations between APH and BC to be effective upon the greenlighting of a specific film or show Mr. MacGregor, CEO and a director of the Company, Mr. MacGregor is also the CEO and a director of Bold Crayon and effectively controls Bold Crayon as a managing manager of the trustee of the trust that owns the majority ownership interest in Bold Crayon. Mr. Michael Blanchard was a past Director and Secretary/Treasurer of Bold Crayon and is a director of APHP. The transaction between the parties has been consummated and all IP and copyrights have been transferred. During the quarters ended March 31, 2024 and 2023, the Company reported revenues of $23,003 and $0, respectively, from the CAMA. Inception to date, the Company has received $304,875 under the CAMA. As partial consideration for the BC Assets being acquired by APH hereunder, APHP agreed to pay BC the first one hundred thirty thousand dollars ($130,000.00 USD) that APHP collected from the BUFFALOED and to deliver one Preferred Share to BC for each ten thousand dollars ($10,000.00 USD), in value paid to the APHP from the BUFFALOED receivable above the one hundred thirty thousand dollars ($130,000.00 USD), not to exceed one hundred twenty-five (125) Preferred Shares. As of March 31, 2024, Bold Crayon was due to receive 17 Preferred Shares of APHP.

 

 

On November 10, 2022, the Company approved the optioning of MIDNIGHT’S DOOR written by Kirsten Elms from Mr. Luessenhop for $12,700 (provided the Company produces MIDNIGHT’S DOOR as a feature film and further subject to producer agreements with Luessenhop and MacGregor). Mr. Luessenhop was a director of the Company and owned 2.005% of the Company at the time of this transaction. The Company elected to allow this option to expire during the first quarter of 2024 resulting in the expensing of $7,500 of previously capitalized costs.

 

On November 10, 2022 the Company entered into an additional agreement regarding THE DEVIL’S HALF-ACRE to extend additional financing in an undetermined amount to the film in exchange among other things for increased equity in the film. At the time, DEVIL’S HALF-ACRE was controlled by Mr. Luessenhop.

 

During the first quarter of 2023, the Company borrowed $125,500 from Mr. MacGregor pursuant to a master loan agreement dated March 1, 2023. The master note agreement accrues interest at a rate of 4.4% due and payable in a lump sum upon maturity of the obligation. This note is not convertible.

 

During the first quarter of 2024, the Company borrowed $250,000 from a trust managed by Mr. MacGregor pursuant to a master loan agreement dated February 6, 2024. The master note agreement accrues interest at a rate of 4.68% due and payable in a lump sum upon maturity of the obligation. This note is not convertible.

 
v3.24.1.1.u2
SUBSEQUENT EVENTS
 3 Months Ended
Mar. 31, 2024
Subsequent Events [Abstract]  
SUBSEQUENT EVENTS

NOTE 11 – SUBSEQUENT EVENTS

 

In accordance with FASB ASC 855-10, Subsequent Events, the Company has analyzed its operations subsequent to March 31, 2024, to the date these consolidated financial statements were issued. Except as noted below, management has determined that it does not have any material subsequent events to disclose in these consolidated financial statements.

 

Sales of Common Stock

 

During the period April 1, 2024 to present, the Company sold 616,000 shares of Common Stock at $0.25 per share to new investors resulting in total proceeds of $154,000.

 

Borrowing under Line of Credit

 

On April 1 and April 10, the Company borrowed $70,000 and $44,300 under its American Express Business Line of Credit. The April 1st advance had an annual percentage rate of 16.09% and is payable in twelve monthly installments. The April 10th advance had an annual percentage rate of 32.67% and is payable in six monthly installments. Repayment of these borrowings commenced in May 2024. Mr. MacGregor has personally guaranteed these loans.

 

On April 1, 2024 Bannor Michael MacGregor loaned the Company $25,000. On April 15th, the Company paid back $12,500 to Mr. MacGregor.
v3.24.1.1.u2
Summary Of Significant Accounting Policies (Policies)
 3 Months Ended
Mar. 31, 2024
Accounting Policies [Abstract]  
Basis of Presentation

Basis of Presentation

 

The accompanying financial statements have been prepared in accordance with the Financial Accounting Standards Board (“FASB”) “FASB Accounting Standard Codification™” (the “Codification”) which is the source of authoritative accounting principles recognized by the FASB to be applied by nongovernmental entities in the preparation of financial statements in conformity with accepted accounting principles (“GAAP”) in the United States.

 
Principles of Consolidation

Principles of Consolidation

 

The condensed consolidated financial statements of the Company include the accounts of American Picture House Corporation and its wholly owned subsidiaries, Devil’s Half-Acre, LLC and Ask Christine Productions, LLC.

 
Going Concern

Going Concern

 

The accompanying financial statements have been prepared assuming the Company will continue as a going concern, which contemplates the realization of assets and the satisfaction of liabilities in the normal course of business for the twelve months following the date of these financial statements. As of March 31, 2024, the Company had a working capital deficit of ($270,351) and an accumulated deficit of $6,517,683.

 

Because the Company does not expect that the existing operational cash flow will be sufficient to fund presently anticipated operations, this raises substantial doubt about the Company’s ability to continue as a going concern. Therefore, the Company will need to raise additional funds and is currently exploring alternative sources of financing. Recently the Company has been funded by related party shareholders and officers. Historically, the Company raised capital through private placements, to finance working capital needs and may attempt to raise capital through the sale of common stock or other securities and obtaining some short-term loans. The Company will be required to continue to do so until its operations become profitable. Also, the Company has, in the past, paid for consulting services with its common stock to maximize working capital, and intends to continue this practice where feasible.

 
Use of Estimates

Use of Estimates

 

The preparation of financial statements in conformity with US GAAP requires management to make estimates and assumptions that affect the reported amounts of liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. The most significant estimates relate to income taxes and contingencies. The Company bases its estimates on historical experience, known or expected trends, and various other assumptions that are believed to be reasonable given the quality of information available as of the date of these financial statements. The results of these assumptions provide the basis for making estimates about the carrying amount of assets and liabilities that are not readily apparent from other sources. Actual results could differ from these estimates.

 

 
Cash and cash equivalents

Cash and cash equivalents

 

Cash equivalents are short-term highly liquid investments which include short term bank deposits (up to three months from date of deposit), that are not restricted as to withdrawals or use that are readily convertible to cash with maturities of three months or less as of the date acquired. The Company’s policy is to maintain its cash balances with financial institutions with high credit ratings and in accounts insured by the Federal Deposit Insurance Corporation (the “FDIC”) and/or by the Securities Investor Protection Corporation (the “SIPC”). The Company may periodically have cash balances in financial institutions in excess of the FDIC and SIPC insurance limits of $250,000 and $500,000, respectively. The Company has not experienced any losses to date resulting from this policy.

 
Accounts receivable

Accounts receivable

 

Accounts receivable primarily consist of trade receivables due from customers for consulting services and from fees derived from licensing of IP to content providers worldwide. As of March 31, 2024, $50,000 (97%) of accounts receivable were related to the grant of a producer credit in a proposed future film. As of December 31, 2023, 100% of accounts receivable were due from the BUFFALOED CAMA (see Assigned Rights to feature film, BUFFALOED below).

 

   March 31, 2024   December 31, 2023 
Accounts receivable, trade  $50,000   $- 
Accounts receivable, related party   1,775    - 
Accounts receivable, CAMA   -    31,948 
Accounts receivable   $51,775   $31,948 

 
Allowance for doubtful accounts

Allowance for doubtful accounts

 

The allowance for doubtful accounts is determined with respect to amounts the Company has determined to be doubtful of collection. In determining the allowance for doubtful accounts, the Company considers, among other things, its past experience with customers, the length of time that the balance is past due, the customer’s current ability to pay and available information about the credit risk on such customers. In 2023, the Company wrote off $193,932 of receivables as bad debt based on a review of the customer’s ability to pay, the customer’s Managing Director resigning, and the customer ceasing operations. There was no bad debt expense during the quarter ended March 31, 2024 and no allowance for doubtful accounts at March 31, 2024 or December 31, 2023.

 
Prepaid expenses

Prepaid expenses

 

At March 31, 2024, prepaid expenses consisted of prepaid insurance, prepaid licenses, and prepaid services. Prepaid expenses are amounts paid to secure the use of assets or the receipt of services at a future date or continuously over one or more future periods. When the prepaid expenses are eventually consumed, they are charged to expense. The Company had $13,367 and $29,185 in prepaid expenses as of March 31, 2024 and December 31, 2023, respectively.

 
Produced and Licensed Content Costs

Produced and Licensed Content Costs

 

Capitalized production costs, whether produced or acquired/ licensed rights, include development costs, direct costs and production overhead. These amounts and licensed content are included in “Produced and Licensed Content Costs” on the balance sheet as follows:

 

   March 31, 2024   December 31, 2023 
Films in development and pre-production stage  $200,403   $210,633 
   $200,403   $210,633 

 

 
Impairment Assessment for Investment in Films and Licensed Program Rights

Impairment Assessment for Investment in Films and Licensed Program Rights

 

A film group or individual film is evaluated for impairment when an event or change in circumstances indicates that the fair value of an individual film or film group is less than its unamortized cost.

 

During the quarter ended March 31, 2024, the Company allowed options to two screenplays to expire and wrote-off $15,000 of previously capitalized option costs.

 
Assigned rights to the feature film, BUFFALOED.

Assigned rights to the feature film, BUFFALOED.

 

In November 2022, the Company obtained certain limited rights to the feature film BUFFALOED from Bold Crayon, Inc. (“BC”), including a secured position of a one million three hundred eighty-thousand-dollar ($1,380,000.00 USD) receivable against the film’s revenues as per the film’s Cash Asset Management Agreement (“CAMA”) and a 35% share of the profits generated thereafter (“the BC Assets”). During the quarters ended March 31, 2024 and 2023, the Company reported revenues of $23,003 and $0, respectively, from the CAMA. Inception to date, the Company has received $304,875 under the CAMA. Due to uncertainties of any future revenue, if any, no value has been assigned to any potential future revenues.

 

As partial consideration for the BC Assets being acquired by APH hereunder, APHP agreed to pay BC the first one hundred thirty thousand dollars ($130,000.00 USD) that APHP collected from the BUFFALOED and to deliver one Preferred Share to BC for each ten thousand dollars ($10,000.00 USD), in value paid to the APHP from the BUFFALOED receivable above the one hundred thirty thousand dollars ($130,000.00 USD), not to exceed one hundred twenty-five (125) Preferred Shares. As of March 31, 2024, Bold Crayon was due to receive 17 Preferred Shares of APHP.

 
Intangible assets

Intangible assets

 

The Company’s intangible assets include in-service and under-development websites and licensed internal use software. During the year ended December 31, 2023 the Company developed an external website that was placed in service during the third quarter of 2023. Additionally, during the fourth quarter of 2023 the Company began developing additional aspects of its website that went live in April 2024. During the fourth quarter of 2023, the Company licensed rights to new internal use software, but subsequently placed that project on hold and has not established a timeline for placing the software in service.

 

The capitalized costs of the Company’s websites placed into service were subject to straight-line amortization over a three-year period. Amortization expense totaled $$750 and $0 for the quarters ended March 31, 2024 and 2023, respectively.

 
Deferred Revenue

Deferred Revenue

 

Deferred revenue represents the amount billed to clients that has not yet been earned, pursuant to agreements entered into in current and prior periods. As of March 31, 2024 and December 31, 2023, total net deferred revenue was $50,000 and $0, respectively. As previously noted, the $50,000 in deferred revenue at March 31, 2024, relates to the grant of a producer credit to a proposed film.

 
Revenues and Costs from Services and Products

Revenues and Costs from Services and Products – Historically, Company’s revenue comes from contracts with customers for consulting services and from the licensing and distribution of film and other entertainment rights. The consulting services typically relate to development of business strategy and monetization of intellectual property rights. The Company accounts for a contract with a customer when there is an enforceable contract between the Company and the customer, the rights of the party are identified, the contract has economic substance, and collectability of the contract is considered probable. Historically, the term of these consulting agreements has been approximately three to six months in duration. The Company’s revenue is measured based on considerations specified in the contract with each customer. Accounting Standards Codification (“ASC”) 606 allows for adoption of an “as invoiced” practical expedient that allows companies to recognize revenue in the amount to which the entity has a right to invoice when they have a right to consideration from a customer in an amount that corresponds directly with the value to the customer of the entity’s performance completed to date. The Company has elected to adopt this practical expedient with regards to its consulting services revenue. Revenues for the three months ended March 31, 2023 totaled $165,000. As discussed in Note 10 – Related Party Transactions, $35,000 of the revenue was from Ribo Music and the remaining $135,000 was from a second client. The Company did not have any consulting revenues in 2024.

 

 

Revenues from Films and Licensed Rights, are calculated based on expected ultimate revenues estimated over a period not to exceed ten years following the date of initial release of the motion picture. For an episodic television series, the period over which ultimate revenues are estimated cannot exceed ten years following the date of delivery of the first episode, or, if still in production, five years from the date of delivery of the most recent episode, if later. For titles included in acquired libraries, ultimate revenue includes estimates over a period not to exceed twenty years following the date of acquisition.

 

Revenue derived from the BUFFALOED CAMA totaled $23,003 and $0 for the quarters ended March 31, 2024 and 2023, respectively.

 
Fair Value Measurements

Fair Value Measurements – The Company measures and discloses fair value in accordance with the ASC Topic 820, Fair Value Measurements and Disclosures which defines fair value, establishes a framework and gives guidance regarding the methods used for measuring fair value, and expands disclosures about fair value measurements. Fair value is an exit price, representing the amount that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. As such, fair value is a market-based measurement that should be determined based on assumptions that market participants would use in pricing an asset or liability. As a basis for considering such assumptions there exists a three-tier fair-value hierarchy, which prioritizes the inputs used in measuring fair value as follows:

 

Level 1 - unadjusted quoted prices are available in active markets for identical assets or liabilities that the Company has the ability to access as of the measurement date.

 

Level 2 - pricing inputs are other than quoted prices in active markets that are directly observable for the asset or liability or indirectly observable through corroboration with observable market data.

 

Level 3 - pricing inputs are unobservable for the non-financial asset or liability and only used when there is little, if any, market activity for the non-financial asset or liability at the measurement date. The inputs into the determination of fair value require significant management judgment or estimation. Level 3 inputs are considered as the lowest priority within the fair value hierarchy. The valuation of the right to obtain control over affiliated company, right to acquire shares of other companies, contingent consideration to be paid upon achieving of performance milestone, certain convertible bridge loans (following the maturity date and thereafter) and certain freestanding stock warrants and bifurcated convertible feature of convertible bridge loans issued to the units’ owners, fall under this category.

 

This hierarchy requires the Company to use observable market data, when available, and to minimize the use of unobservable inputs when determining fair value.

 

The fair value of cash and cash equivalents is based on its demand value, which is equal to its carrying value. Additionally, the carrying value of all other short-term monetary assets and liabilities are estimated to be equal to their fair value due to the short-term nature of these instruments.

 
Valuation of Long-Lived Assets

Valuation of Long-Lived Assets – The Company evaluates whether events or circumstances have occurred which indicate that the carrying amounts of long-lived assets (principally produced and licensed content costs) may be impaired or not recoverable. The significant factors that are considered that could trigger an impairment review include: changes in business strategy, market conditions, or the manner of use of an asset; underperformance relative to historical or expected future operating results; and negative industry or economic trends. In evaluating an asset for possible impairment, management estimates that asset’s future undiscounted cash flows and appraised values to measure whether the asset is recoverable. The Company measures the impairment based on the projected discounted cash flows of the asset over its remaining life.

 

 
Stock-Based Compensation

Stock-Based Compensation – The Company follows U.S. GAAP, which requires all stock-based compensation to employees, including the grant of employee stock options, to be recognized in the statement of operations based on its fair value. Awards outstanding are accounted for using the accounting principles originally applied to the award. The expense associated with share-based compensation is recognized on a straight-line basis over the service period of each award. Refer to Note 8 for additional information related to this stock-based compensation plan.

 
Income taxes

Income taxes

 

The Company accounts for income taxes under FASB ASC 740, “Accounting for Income Taxes”. Under FASB ASC 740, deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. Under FASB ASC 740, the effect on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period that includes the enactment date. FASB ASC 740-10-05, “Accounting for Uncertainty in Income Taxes” prescribes a recognition threshold and a measurement attribute for the financial statement recognition and measurement of tax positions taken or expected to be taken in a tax return. For those benefits to be recognized, a tax position must be more-likely-than-not to be sustained upon examination by taxing authorities.

 

The amount recognized is measured as the largest amount of benefit that is greater than 50 percent likely of being realized upon ultimate settlement. The Company assesses the validity of its conclusions regarding uncertain tax positions quarterly to determine if facts or circumstances have arisen that might cause it to change its judgment regarding the likelihood of a tax position’s sustainability under audit.

 
Net Loss per Share

Net Loss per Share

 

Basic (loss) income per share is computed by dividing net (loss) income available to Common Stockholders by the weighted average number of common shares outstanding during the period. Diluted (loss) income per share reflects the potential dilution, using the treasury stock method that could occur if securities or other contracts to issue Common Stock were exercised or converted into Common Stock or resulted in the issuance of Common Stock that then shared in the (loss) income of the Company. In computing diluted (loss) income per share, the treasury stock method assumes that outstanding instruments are exercised/converted, and the proceeds are used to purchase Common Stock at the average market price during the period. Instruments may have a dilutive effect under the treasury stock method only when the average market price of the Common Stock during the period exceeds the exercise price/conversion rate of the instruments.

 

The following common share equivalents are excluded from the calculation of weighted average common shares outstanding because their inclusion would have been anti-dilutive:

 

   March 31, 2024   December 31, 2023 
Convertible Preferred Stock   382,900,000    382,900,000 
Options to Purchase Common Stock   5,083,471      
           
    387,983,471    382,900,000 

 
Segment Information

Segment Information

 

Operating segments are defined as components of an enterprise about which separate discrete information is available for evaluation by the chief operating decision maker (“CODM”), or decision-making group, in deciding how to allocate resources and in assessing performance. For the period of these financial statements, the CEO of the Company was the CODM. The Company views its operations and manages its business as one operating and reporting segment.

 
New accounting standards

New accounting standards

 

The Company’s management has evaluated all the recently issued, but not yet effective, accounting standards and guidance that have been issued or proposed by the FASB or other standards-setting bodies through the filing date of these financial statements and does not believe the future adoption of any such pronouncements will have a material effect on the Company’s financial position and results of operations.
v3.24.1.1.u2
Summary Of Significant Accounting Policies (Tables)
 3 Months Ended
Mar. 31, 2024
Accounting Policies [Abstract]  
SCHEDULE OF ACCOUNTS RECEIVABLE

   March 31, 2024   December 31, 2023 
Accounts receivable, trade  $50,000   $- 
Accounts receivable, related party   1,775    - 
Accounts receivable, CAMA   -    31,948 
Accounts receivable   $51,775   $31,948 
SCHEDULE OF PRODUCED AND LICENSED CONTENT COSTS

Capitalized production costs, whether produced or acquired/ licensed rights, include development costs, direct costs and production overhead. These amounts and licensed content are included in “Produced and Licensed Content Costs” on the balance sheet as follows:

 

   March 31, 2024   December 31, 2023 
Films in development and pre-production stage  $200,403   $210,633 
   $200,403   $210,633 
SCHEDULE OF ANTIDILUTIVE SECURITIES EXCLUDED FROM COMPUTATION OF WEIGHTED AVERAGE COMMON SHARES OUTSTANDING

The following common share equivalents are excluded from the calculation of weighted average common shares outstanding because their inclusion would have been anti-dilutive:

 

   March 31, 2024   December 31, 2023 
Convertible Preferred Stock   382,900,000    382,900,000 
Options to Purchase Common Stock   5,083,471      
           
    387,983,471    382,900,000 
v3.24.1.1.u2
Intangible Assets (Tables)
 3 Months Ended
Mar. 31, 2024
Goodwill and Intangible Assets Disclosure [Abstract]  
SCHEDULE OF INTANGIBLE ASSETS

The identifiable intangible assets consist of the following assets:

 

   March 31, 2024   December 31, 2023 
Website placed in service  $9,000   $9,000 
Website - under development   42,000    42,000 
Software – predeployment   24,864    21,684 
Intangible assets, gross   75,864    72,684 
           
Accumulated amortization   (1,750)   (1,000)
Intangible assets, net  $74,114   $71,684 
v3.24.1.1.u2
SCHEDULE OF ACCOUNTS RECEIVABLE (Details) - USD ($)
Mar. 31, 2024
Dec. 31, 2023
Dec. 31, 2022
Nov. 30, 2022
Accounts, Notes, Loans and Financing Receivable [Line Items]        
Accounts receivable  $ 51,775 $ 31,948 [1]    
Cash Asset Management Agreement [Member]        
Accounts, Notes, Loans and Financing Receivable [Line Items]        
Accounts receivable  31,948 $ 304,875 $ 304,875
Related Party [Member]        
Accounts, Notes, Loans and Financing Receivable [Line Items]        
Accounts receivable  1,775    
Trade Accounts Receivable [Member]        
Accounts, Notes, Loans and Financing Receivable [Line Items]        
Accounts receivable  $ 50,000    
[1] Derived from audited information
v3.24.1.1.u2
SCHEDULE OF PRODUCED AND LICENSED CONTENT COSTS (Details) - USD ($)
Mar. 31, 2024
Dec. 31, 2023
Accounting Policies [Abstract]    
Filims in development and pre-production stage $ 200,403 $ 210,633
Produced and licensed content costs $ 200,403 $ 210,633 [1]
[1] Derived from audited information
v3.24.1.1.u2
SCHEDULE OF ANTIDILUTIVE SECURITIES EXCLUDED FROM COMPUTATION OF WEIGHTED AVERAGE COMMON SHARES OUTSTANDING (Details) - shares
 3 Months Ended 12 Months Ended
Mar. 31, 2024
Dec. 31, 2023
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]    
Antidilutive securities excluded from computation of earnings per share, amount 387,983,471 382,900,000
Convertible Debt Securities [Member]    
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]    
Antidilutive securities excluded from computation of earnings per share, amount 382,900,000 382,900,000
Common Stock [Member]    
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]    
Antidilutive securities excluded from computation of earnings per share, amount 5,083,471  
v3.24.1.1.u2
Summary Of Significant Accounting Policies (Details Narrative) - USD ($)
 3 Months Ended 12 Months Ended
Mar. 31, 2024
Mar. 31, 2023
Dec. 31, 2023
Dec. 31, 2022
Nov. 30, 2022
Product Information [Line Items]          
Working capital deficit $ 270,351        
Accumulated deficit 6,517,683   $ 5,021,696 [1]    
Cash, FDIC insured amount 250,000        
Cash, SIPC insured amount 500,000        
Accounts receivable 51,775   31,948 [1]    
Reserve for uncollectible receivable     193,932    
Bad debt expense 0        
Allowance for doubtful accounts 0   0    
Prepaid expenses 13,367   29,185 [1]    
Wrote-off of capitalized option costs 15,000        
Revenues $ 23,003 $ 169,111      
Amortization period 3 years        
Amortization expense $ 750      
Net deferred revenue 50,000   [1]    
Consulting Services [Member]          
Product Information [Line Items]          
Revenues   165,000      
Ribo Music LLC [Member]          
Product Information [Line Items]          
Revenues   35,000      
Product and Service, Other [Member]          
Product Information [Line Items]          
Revenues   135,000      
Bold Crayons [Member]          
Product Information [Line Items]          
Asset acquisition, purchase price consideration 130,000.00     $ 130,000.00  
Bold Crayons [Member] | Preferred Stock [Member]          
Product Information [Line Items]          
Asset acquisition, purchase price consideration $ 10,000.00     $ 10,000.00  
Asset acquisition, number of shares 17     125  
Bold Crayons [Member] | Preferred Stock [Member] | Maximum [Member]          
Product Information [Line Items]          
Asset acquisition, number of shares 125        
Cash Asset Management Agreement [Member]          
Product Information [Line Items]          
Accounts receivable   $ 31,948 $ 304,875 $ 304,875
Receivables         $ 1,380,000.00
Share of profits percentage         35.00%
Revenues 23,003 $ 0      
Accounts Receivable [Member] | Customer Concentration Risk [Member] | Customer [Member]          
Product Information [Line Items]          
Accounts receivable $ 50,000        
Concentration risk, percentage 97.00%        
Accounts Receivable [Member] | Customer Concentration Risk [Member] | BUFFALOED CAMA [Member]          
Product Information [Line Items]          
Concentration risk, percentage     100.00%    
[1] Derived from audited information
v3.24.1.1.u2
Liquidity and Going Concern (Details Narrative) - USD ($)
 3 Months Ended 12 Months Ended
Mar. 31, 2024
Mar. 31, 2023
Dec. 31, 2023
Dec. 31, 2022
Dec. 31, 2021
Dec. 31, 2020
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items]            
Working capital $ 270,351          
Accumulated deficit 6,517,683   $ 5,021,696 [1]      
Proceeds from debt borrowings $ 250,000 $ 125,000 178,500      
Repayments of related party debt     $ 178,500      
Debt instrument, accrued interest rate     4.40%      
Master Loan Agreement [Member]            
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items]            
Debt instrument, face amount     $ 250,000      
Service [Member]            
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items]            
Revenues     $ 169,111 $ 461,174 $ 0 $ 0
[1] Derived from audited information
v3.24.1.1.u2
Film Production Loans (Details Narrative) - USD ($)
 1 Months Ended 3 Months Ended
May 15, 2024
Feb. 29, 2024
Mar. 31, 2024
Apr. 30, 2024
Dec. 31, 2023
 [1]
Loans receivable, film financing arrangements     $ 220,000  
Senior Loan Agreement With PNP Movie LLC [Member]          
Advance fund     $ 20,000    
Senior Loan Agreement With PNP Movie LLC [Member] | Subsequent Event [Member]          
Advance fund $ 195,000        
Senior Mezzannine Loan Agreement With Barrons Cove Movie LLC [Member]          
Pay from executive producer fees   $ 20,000      
Debt instrument, description   The $200,00 loan, plus a premium of twenty percent (20%), is due and payable on that date which is the earlier of either (a) twelve (12) months from the date of the loan, or (b) from allocable proceeds received by Barron’s Cove Movie, LLC related to the movie, whichever occurs first      
Senior Mezzannine Loan Agreement With Barrons Cove Movie LLC [Member] | Mr. Macgregor [Member]          
Pay from executive producer fees   $ 10,000      
Senior Mezzannine Loan Agreement With Barrons Cove Movie LLC [Member] | Barron's Cove Movie, LLC [Member]          
Loans receivable, film financing arrangements   $ 200,000      
Senior Loan Agreement With PNP Movie LLC [Member]          
Debt instrument, description   These loans, plus a premium of twenty percent (20%), is due and payable on that date which is the earlier of either (a) twelve (12) months from the date of the loan, or (b) from allocable proceeds received by PNP Movie, LLC related to the movie, whichever occurs first      
Debt instrument, face amount   $ 97,475      
Senior Loan Agreement With PNP Movie LLC [Member] | Subsequent Event [Member]          
Debt instrument, face amount       $ 42,525  
Aggregate financing       $ 597,475  
[1] Derived from audited information
v3.24.1.1.u2
SCHEDULE OF INTANGIBLE ASSETS (Details) - USD ($)
Mar. 31, 2024
Dec. 31, 2023
Finite-Lived Intangible Assets [Line Items]    
Intangible assets, gross $ 75,864 $ 72,684
Accumulated amortization (1,750) (1,000)
Intangible assets, net 74,114 71,684
Website Placed in Service [Member]    
Finite-Lived Intangible Assets [Line Items]    
Intangible assets, gross 9,000 9,000
Website Under Development [Member]    
Finite-Lived Intangible Assets [Line Items]    
Intangible assets, gross 42,000 42,000
Software-Predeployment [Member]    
Finite-Lived Intangible Assets [Line Items]    
Intangible assets, gross $ 24,864 $ 21,684
v3.24.1.1.u2
Intangible Assets (Details Narrative) - USD ($)
 3 Months Ended
Mar. 31, 2024
Mar. 31, 2023
Goodwill and Intangible Assets Disclosure [Abstract]    
Impairment charges $ 0 $ 0
Amortization of intangible assets $ 750
v3.24.1.1.u2
Notes Payable (Details Narrative) - USD ($)
 1 Months Ended 3 Months Ended 12 Months Ended
Feb. 06, 2024
Mar. 31, 2021
Mar. 31, 2024
Mar. 31, 2023
Dec. 31, 2023
Feb. 29, 2024
Proceeds from debt borrowings     $ 250,000 $ 125,000 $ 178,500  
Debt instrument, accrued interest rate         4.40%  
Loans receivable, film financing arrangements     220,000   [1]  
Economic injury disaster loan, non-current   $ 149,900 149,900   $ 149,900 [1]  
Debt instrument term   30 years        
Interest rate   3.75%        
Noah Morgan Private Family Trust Loan Agreement [Member]            
Proceeds from debt borrowings $ 250,000          
Debt instrument, accrued interest rate 4.68%          
Debt instrument maturity date Feb. 06, 2025          
Senior Mezzannine Loan Agreement With Barrons Cove Movie LLC [Member] | Barron's Cove Movie, LLC [Member]            
Loans receivable, film financing arrangements           $ 200,000
Mr. Macgregor [Member]            
Proceeds from debt borrowings     $ 250,000 $ 125,500    
Debt instrument, accrued interest rate     4.68% 4.40%    
[1] Derived from audited information
v3.24.1.1.u2
Equity (Details Narrative)
 3 Months Ended
May 02, 2024
Shareholders
shares
Mar. 31, 2024
$ / shares
shares
Dec. 31, 2023
shares
Class of Stock [Line Items]      
Common stock, shares authorized   1,000,000,000 1,000,000,000
Common stock, shares issued   109,865,991 109,790,991
Common stock, shares outstanding   109,865,991 109,790,991
Preferred stock, shares designated   1,000,000 1,000,000
Preferred stock, shares outstanding   3,829 3,829
Series A Preferred Stock [Member]      
Class of Stock [Line Items]      
Preferred stock, shares designated   100,000  
Preferred stock, shares outstanding   3,829  
Preferred stock, voting rights   The Series A preferred shares have the following rights: (i.) a first position lien against all of the Company’s assets including but not limited to the Company’s IP (“Intellectual Property”), (ii.) is convertible at a ratio of 1 to 100,000 so that each one share of Series A preferred stock may be exchanged for 100,000 Common Stock shares, (iii.) and that each share of Series A preferred stock shall carry superior voting rights to the Company’s Common Stock and that each share of Series A preferred stock shall be counted as 1,000,000 votes in any Company vote and (iv.) and any other benefits as deemed necessary and appropriate at the time of such issuance  
Preferred stock, liquidation preference per share | $ / shares   $ 12.02  
Subsequent Event [Member]      
Class of Stock [Line Items]      
Common stock, shares issued 111,399,325    
Common stock, shares outstanding 111,399,325    
Number of shareholders | Shareholders 331    
v3.24.1.1.u2
Equity Based Compensation (Details Narrative) - USD ($)
 3 Months Ended
Feb. 08, 2024
Mar. 31, 2024
Fair value of stock options   $ 100,000
Issuance of options 5,083,471  
Exercise price of options $ 0.0125  
Vesting rate   100.00%
Stock option compensation expense   $ 1,258,160
Board of Directors Chairman [Member]    
Issuance of options 250,000  
Advisors [Member]    
Issuance of options 1,673,250  
Mr. Macgregor [Member]    
Issuance of options 662,983  
Mr.Blanchard [Member]    
Issuance of options 497,238  
v3.24.1.1.u2
Related Party Transactions (Details Narrative) - USD ($)
 1 Months Ended 3 Months Ended 12 Months Ended
Jan. 01, 2023
Nov. 10, 2022
Sep. 30, 2023
Mar. 31, 2024
Mar. 31, 2023
Dec. 31, 2023
Dec. 31, 2022
Jul. 31, 2023
Nov. 30, 2022
Services accrued and unpaid       $ 0   $ 20,000      
Conversion of accrued liabilities into options to purchase common stock $ 105,000                
Conversion of accrued liabilities into options to purchase common stock, shares 1,160,221                
Share price $ 0.125                
Accounts receivable       51,775   31,948 [1]      
Revenue       23,003 $ 169,111        
Loan borrowed       250,000 125,000 $ 178,500      
Accrued interest rate           4.40%      
Bold Crayons [Member]                  
Asset acquisition, purchase price consideration       130,000.00     $ 130,000.00    
Bold Crayons [Member] | Preferred Stock [Member]                  
Asset acquisition, purchase price consideration       $ 10,000.00     $ 10,000.00    
Asset acquisition, number of shares       17     125    
Cash Asset Management Agreement [Member]                  
Accounts receivable         $ 31,948 $ 304,875   $ 304,875
Revenue       23,003 0        
Devils Half Acre Productions LLC [Member]                  
Ownership percentage               100.00%  
Ribo Music LLC [Member]                  
Revenues       0 35,000        
Accounts receivable       1,775   $ 0      
Dashiell Luessenhop [Member]                  
Option fee to writer     $ 5,000            
Consulting Services [Member]                  
Compensation expenses       15,000 26,000        
Revenue         165,000        
Director [Member]                  
Professional fees       45,000 30,000        
Production costs       148,824          
Mr Luessenhop [Member]                  
Film optioning costs   $ 12,700              
Related party rate   200.50%              
Capitalized cost   $ 7,500              
Mr. Macgregor [Member]                  
Loan borrowed       $ 250,000 $ 125,500        
Accrued interest rate       4.68% 4.40%        
[1] Derived from audited information
v3.24.1.1.u2
SUBSEQUENT EVENTS (Details Narrative) - USD ($)
 12 Months Ended
Apr. 01, 2024
Dec. 31, 2023
Apr. 10, 2024
Mar. 31, 2024
Mar. 31, 2023
Subsequent Event [Line Items]          
Interest rate   4.40%      
Accounts receivable   $ 31,948 [1]   $ 51,775  
Repayment of related party debt   $ 178,500      
Mr. Macgregor [Member]          
Subsequent Event [Line Items]          
Interest rate       4.68% 4.40%
Subsequent Event [Member] | Mr. Macgregor [Member]          
Subsequent Event [Line Items]          
Accounts receivable $ 25,000        
Repayment of related party debt 12,500        
Subsequent Event [Member] | American Express Business [Member]          
Subsequent Event [Line Items]          
Borrowing amount $ 70,000   $ 44,300    
Interest rate 16.09%   32.67%    
New Investors [Member] | Subsequent Event [Member]          
Subsequent Event [Line Items]          
Sale of stock 616,000        
Sale of stock price per share $ 0.25        
Total proceeds $ 154,000        
[1] Derived from audited information
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