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EXCEL - IDEA: XBRL DOCUMENT - PARALLAX HEALTH SCIENCES, INC.Financial_Report.xls
EX-31 - EX 31.2 SEC 302 CERT - CFO - PARALLAX HEALTH SCIENCES, INC.ex312section302certification.htm
EX-32 - EX 32.1 SEC 906 CERT - CEO - PARALLAX HEALTH SCIENCES, INC.ex321section906certification.htm
EX-32 - EX 32.2 SEC 906 CERT - CFO - PARALLAX HEALTH SCIENCES, INC.ex322section906certification.htm
EX-31 - EX 31.1 SEC 302 CERT - CEO - PARALLAX HEALTH SCIENCES, INC.ex311section302certification.htm

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

Form 10-Q

(Mark One)

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

For the quarterly period ended September 30, 2014

or

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

For the transition period from__________ to _________

Commission File Number
000-52534

[f20140930prlxform10qfinal001.jpg]

PARALLAX HEALTH SCIENCES, INC.
(Exact name of registrant as specified in its charter)

Nevada

46-4733512

(State or other jurisdiction of incorporation or organization)

(I.R.S. Employer Identification No.)

 

  

One Boston Place, Suite 2600, Boston, MA

02108

(Address of principal executive offices)

(Zip Code)

  

  

Registrant's telephone number, including area code:

(617) 209-7999


Copy of all Communications to:

Lawrence I. Washor

Washor & Associates

21800 Oxnard Street, Suite 790

Woodland Hills, CA 91367

(310) 479-2660


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 such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.

x YES      o   NO

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files).

x YES      o   NO

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


Large accelerated filer

o

 

Accelerated filer

o

Non-accelerated filer

o

 

Smaller reporting company

x

(Do not check if a smaller reporting company)

 

 

 


Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act)

o YES      x NO


APPLICABLE ONLY TO CORPORATE ISSUERS


Indicate the number of shares outstanding of each of the issuer’s classes of common stock, as of the latest practicable date.


132,026,053 common shares issued and outstanding as of November 18, 2013





PART 1 – FINANCIAL INFORMATION


ITEM 1. FINANCIAL STATEMENTS


The Company’s unaudited interim consolidated financial statements for the nine months ended September 30, 2014 form part of this quarterly report. They are stated in United States Dollars (US$) and are prepared in accordance with United States generally accepted accounting principles.


These financial statements should be read in conjunction with the audited consolidated financial statements and notes for the year ended December 31, 2013, on Form 10-K, as filed with the Securities and Exchange Commission on April 14, 2014.



2




PARALLAX HEALTH SCIENCES, INC.

CONSOLIDATED BALANCE SHEETS

(Unaudited)

 

 

 

 

 

 

 

 

September 30, 2014

 

December 31, 2013

 

ASSETS

 

 

 

 

 

 

Current assets

 

 

 

 

 

 

Cash and cash equivalents

$

103

 

$

  569

 

Total current assets

 

  103

 

 

  569

 

  

 

 

 

 

 

 

Property and equipment, net

 

11,108

 

 

15,851

 

Intangible assets, net

 

18,336

 

 

19,584

 

 

 

 

 

 

 

 

TOTAL ASSETS

$

29,547

 

$

36,004

 

  

 

 

 

 

 

 

LIABILITIES AND STOCKHOLDERS' DEFICIT

 

 

 

 

 

 

Current liabilities

 

 

 

 

 

 

Accounts payable and accrued expenses

$

278,463

 

$

  174,053

 

Notes and loans payable

 

199,424

 

 

84,075

 

Convertible notes payable

 

144,000

 

 

––

 

Convertible notes payable-related party, net of unamortized discount

 

272,115

 

 

––

 

Related party payables

 

128,309

 

 

  921,693

 

Total current liabilities

 

1,022,311

 

 

  1,179,821

 

  

 

 

 

 

 

 

Long term liabilities

 

 

 

 

 

 

Convertible notes payable-related party, net of unamortized discount

 

348,275

 

 

  190,100

 

Total long term liabilities

 

348,275

 

 

  190,100

 

Total liabilities

 

1,370,586

 

 

  1,369,921

 

 

 

 

 

 

 

 

Stockholders' deficit

 

 

 

 

 

 

Preferred stock, $.001 par, 10,000,000 shares authorized, 823,691 issued and outstanding at September 30, 2014 and December 31, 2013

 

824

 

 

  824

 

Common stock, $.001 par, 250,000,000 shares authorized, 132,026,053 and 162,765,837 issued and outstanding as of September 30, 2014 and December 31, 2013, respectively

 

132,026

 

 

  162,766

 

Additional paid in capital-preferred

 

465,843

 

 

465,843

 

Additional paid in capital-common

 

439,566

 

 

(68,658

)

Subscriptions receivable

 

(5,036

)

 

(1,146

)

Accumulated deficit

 

(2,374,262

)

 

(1,893,546

)

Total stockholders' deficit

 

(1,341,039

)

 

(1,333,917

)

 

 

 

 

 

 

 

TOTAL LIABILITIES AND STOCKHOLDERS' DEFICIT

$

29,547

 

$

36,004

 



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



3




PARALLAX HEALTH SCIENCES, INC.

CONSOLIDATED STATEMENTS OF OPERATIONS

(Unaudited)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

For the three months ended

 

For the nine months ended

 

 

September 30, 2014

 

September 30, 2013

 

September 30, 2014

 

September 30, 2013

 

Revenue

$

––

 

$

––

 

$

––

 

$

––

 

Cost of sales

 

––

 

 

––

 

 

––

 

 

––

 

Gross profit

 

––

 

 

––

 

 

––

 

 

––

 

  

 

 

 

  

 

 

 

 

 

 

 

 

General and administrative expenses

 

129,179

 

 

107,864

 

 

351,205

 

 

338,358

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Operating loss

 

(129,179

)

 

(107,864

)

 

(351,205

)

 

(338,358

)

 

 

 

 

 

 

 

 

 

 

 

 

 

Other income (expenses)

 

 

 

 

 

 

 

 

 

 

 

 

Insurance claim refund

 

––

 

 

––

 

 

––

 

 

1,695

 

Depreciation and amortization

 

(1,997

)

 

(3,057

)

 

(5,991

)

 

(9,171

)

Amortization of deferred compensation

 

––

 

 

42,580

 

 

––

 

 

––

 

Interest expense

 

(90,971

)

 

(4,959

)

 

(123,520

)

 

(15,360

)

Total other income (expenses)

 

(92,968

)

 

34,564

 

 

(129,511

)

 

(22,836

)

 

 

 

 

 

 

 

 

 

 

 

 

 

Net loss

$

(222,147

)

$

(73,300

)

$

(480,716

)

$

(361,194

)

 

 

 

 

 

 

 

 

 

 

 

 

 

Net loss per common share - basic and diluted

$

(0.002

)

$

(0.000

)

$

(0.004

)

$

(0.002

)

 

 

 

 

 

 

 

 

 

 

 

 

 

Weighted average common shares outstanding - basic and diluted

 

132,026,053

 

 

151,306,558

 

 

129,101,414

 

 

146,632,645

 


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




4




PARALLAX HEALTH SCIENCES, INC.

CONSOLIDATED STATEMENTS OF CASH FLOWS

(Unaudited)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

For the nine months ended

 

  

September 30, 2014

 

September 30, 2013

 

Cash flows from operations:

 

 

 

 

 

 

Net loss

$

(480,716

)

$

(361,194

)

Adjustments to reconcile net loss to net cash used in operating activities:

 

 

 

 

 

 

Depreciation expense

 

4,743

 

 

7,923

 

Amortization expense

 

1,248

 

 

1,248

 

Discount amortization

 

91,053

 

 

––

 

Accruals converted to convertible notes payable

 

244,904

 

 

––

 

Changes in operating assets and liabilities:

 

 

 

 

 

 

Increase  in accounts payable and accrued expenses

 

66,910

 

 

21,299

 

Increase in related party payables

 

71,392

 

 

305,126

 

Net cash used in operating activities

 

(466

)

 

(25,598

)

 

 

 

 

 

 

 

Cash flows from financing activities:

 

 

 

 

 

 

Proceeds from related party loans

 

––

 

 

17,600

 

Net cash provided by financing activities

 

––

 

 

17,600

 

 

 

 

 

 

 

 

Net decrease in cash

 

(466

)

 

(7,998

)

  

 

 

 

 

 

 

Cash - beginning of period

 

569

 

 

9,397

 

 

 

 

 

 

 

 

Cash - end of period

$

103

 

$

1,399

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

NON-CASH ACTIVITIES

 

 

 

 

 

 

Conversion of preferred stock into common stock

$

––

 

$

33,330

 

Conversion of related party payable to related party convertible notes payable

$

956,731

 

$

––

 

Assignment of note payable to related party note

$

(144,000

)

$

––

 

Change from related party to non-related party convertible note payable

$

144,000

 

$

––

 

Change from related party debt to non-related party debt

$

152,849

 

$

––

 

Discount on related party debt

$

(473,494

)

$

––

 

Subscriptions receivable

$

5,036

 

$

––

 

 

 

 

 

 

 

 

SUPPLEMENTAL INFORMATION

 

 

 

 

 

 

Interest paid

$

––

 

$

––

 

Income taxes paid

$

––

 

$

––

 


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



5


PARALLAX HEALTH SCIENCES, INC.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

SEPTEMBER 30, 2014


NOTE 1. OVERVIEW AND NATURE OF BUSINESS


The accompanying unaudited consolidated financial statements of Parallax Health Sciences, Inc., (formerly Endeavor Power Corp.) (the “Company”) have been prepared in accordance with generally accepted accounting principles.  The preparation of financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and that effect the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates.


These interim financial statements should be read in conjunction with the audited consolidated financial statements and notes for the year ended December 31, 2013. Notes to the financial statements that would substantially duplicate the disclosures contained in the audited financial statements have been omitted.


On January 9, 2014, the Company changed its name from Endeavor Power Corp. (OTCQB.EDVP) to Parallax Health Sciences, Inc. (OTCQB.PRLX).


Going Concern

The Company has incurred losses since inception resulting in an accumulated deficit of $2,374,262, and a working capital deficit of $1,022,208, and further losses are anticipated. The Company’s ability to continue as a going concern is dependent upon its ability to generate profitable operations in the future and/or to obtain the necessary financing to meet its obligations and repay its liabilities arising from normal business operations when they come due, which may not be available at commercially reasonable terms  There can be no assurance that the Company will be able to continue to raise funds, in which case the Company may be unable to meet its obligations and the Company may cease operations. These factors, among others, raise substantial doubt about the Company’s ability to continue as a going concern.


The consolidated financial statements reflect all adjustments consisting of normal recurring adjustments, which, in the opinion of management, are necessary for a fair presentation of the results for the periods shown. The financial statements do not include any adjustments relating to the recoverability and classification of recorded assets, or the amounts of and classification of liabilities that might be necessary in the event the Company cannot continue as a going concern.


NOTE: The following notes and any further reference made to “the Company”, "we", "us", "our" and "Parallax" shall mean Parallax Health Sciences, Inc.(formerly Endeavor Power Corp.) and its wholly-owned subsidiary, Endeavor Sciences, Inc. (formerly Parallax Diagnostics, Inc.), unless otherwise indicated.


NOTE 2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES


Basis of Presentation

This summary of significant accounting policies is presented to assist in understanding the Company’s financial statements.  These accounting policies conform to accounting principles, generally accepted in the United States of America, and have been consistently applied in the preparation of the financial statements.


The Company’s fiscal year-end is December 31.


Principles of Consolidation

The consolidated financial statements include the accounts of the Company and its wholly owned subsidiary, Endeavor Sciences, Inc., formerly Parallax Diagnostics, Inc. (“ESI”).  All significant inter-company accounts and transactions have been eliminated. In November 2012, the Company acquired 100% of ESI’s common stock in exchange for, among other things, approximately 60% of the Company’s common stock (the “Share Exchange”).


As a result of the Share Exchange, a change in control occurred whereby the Company is the legal parent/accounting subsidiary of ESI, and ESI is the legal subsidiary/accounting parent of the Company.  The Share Exchange has therefore been identified and recorded as a reverse acquisition and, pursuant to ASC 805-40-45-1, the consolidated financial statements’ historical and cumulative data are a continuation of the financial statements of the legal subsidiary, ESI. For cumulative purposes, the date of inception is that of ESI, December 30, 2008.


Cash and Cash Equivalents

The Company considers all highly liquid instruments with maturity of three months or less at the time of issuance to be cash equivalents. As at September 30, 2014, the Company had no cash equivalents.


Use of Estimates

The preparation of financial statements in conformity with US GAAP requires management to make estimates and assumptions that affect the reported amount of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Management routinely makes judgments and estimates about the effects of matters that are inherently uncertain. Estimates that are critical to the accompanying consolidated financial statements include the, estimates related to asset impairments of long lived assets and investments, classification of expenditures as either an asset or an expense, valuation of deferred tax assets, and the likelihood of loss contingencies. Management bases its estimates and judgments on historical experience and on various other factors that are believed to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities that are not readily apparent from other sources. Estimates and assumptions are revised periodically and the effects of revisions are reflected in the financial statements in the period it is determined to be necessary. Actual results could differ from these estimates.


Convertible Debt

In accordance with ASC 470-20-25, the Company recognizes the advantageous value of conversion rights attached to convertible debt. Such rights give the debt holder the ability to convert debt into common stock at a price per share that is less than the trading price to the public on the date of the debt. The beneficial value is calculated as the intrinsic value (the market price of the stock at the commitment date in excess of the conversion rate) of the beneficial conversion feature of the debt, and is recorded as a discount to the related debt and an addition to additional paid in capital. The discount is amortized over the remaining outstanding period of related debt using the interest method.


Net Income (Loss) Per Common Share

The Company computes earnings per share under Accounting Standards Codification subtopic 260-10, Earnings Per Share (“ASC 260-10”). Net earnings (loss) per common share is computed by dividing net income (loss) by the weighted average number of shares of common stock and dilutive common stock equivalents outstanding during the period. Dilutive common stock equivalents consist of shares issuable upon conversion of convertible preferred shares and the exercise of the Company’s stock options and warrants.


Comprehensive Loss

ASC 220, Comprehensive Income, establishes standards for the reporting and display of comprehensive loss and its components in the financial statements. As at September 30, 2014, the Company has no items that represent comprehensive loss and, therefore, has not included a schedule of comprehensive loss in the financial statements.



6


Revenue Recognition

The Company recognizes revenue in accordance with ASC 605, Revenue Recognition. Revenue is recognized only when the price is fixed or determinable, persuasive evidence of an arrangement exists, the service has been provided, and collectability is reasonably assured.  As at September 30, 2014, the Company has not commenced its principal operations and, therefore, has not recognized any revenue.


Property and Equipment

Property and equipment is comprised of office equipment and medical testing and prototype equipment, recorded at cost and depreciated using the double declining balance method over the estimated useful lives of 5 to 7 years. Maintenance and repairs are charged to expense as incurred. Significant renewals and betterments are capitalized.  


Impairment of Long-Lived Assets

In accordance with ASC 350-30, the Company evaluates long-lived assets for impairment whenever events or changes in circumstances indicate that their net book value may not be recoverable.  When such factors and circumstances exist, the Company compares the projected undiscounted future cash flows associated with the related asset or group of assets over their estimated useful lives against their respective carrying amount.  Impairment, if any, is based on the excess of the carrying amount over the fair value, based on market value when available, or discounted expected cash flows, of those assets and is recorded in the period in which the determination is made.  The Company currently believes there is no impairment of its long-lived assets.  There can be no assurance, however, that market conditions will not change or demand for the Company’s products under development will continue.  Either of these could result in future impairment of long-lived assets.


Due to the Company’s recurring losses, its patents were evaluated for impairment and it was determined that future cash flows were sufficient for recoverability of the asset.


Income Taxes

Deferred tax assets and liabilities are recognized for the estimated future tax consequences attributable to temporary differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases. These assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which the temporary differences are expected to reverse.


The Company has net operating loss carryforwards available to reduce future taxable income. Future tax benefits for these net operating loss carryforwards are recognized to the extent that realization of these benefits is considered more likely than not. To the extent that the Company will not realize a future tax benefit, a valuation allowance is established.


Stock-Based Compensation

The Company records stock-based compensation in accordance with ASC 718, Share-Based Payments, using the fair value method. All transactions in which goods or services are the consideration received for the issuance of equity instruments are accounted for based on the fair value of the consideration received or the fair value of the equity instrument issued, whichever is more reliably measurable. Equity instruments issued to employees and the cost of the services received as consideration are measured and recognized based on the fair value of the equity instruments issued.


Fair Value Measurements

Pursuant to ASC 820, Fair Value Measurements and Disclosures and ASC 825, Financial Instruments, an entity is required to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value. ASC 820 and 825 establishes a fair value hierarchy based on the level of independent, objective evidence surrounding the inputs used to measure fair value. A financial instrument’s categorization within the fair value hierarchy is based upon the lowest level of input that is significant to the fair value measurement. ASC 820 and 825 prioritizes the inputs into three levels that may be used to measure fair value:


Level 1

Level 1 applies to assets or liabilities for which there are quoted prices in active markets for identical assets or liabilities.

Level 2

Level 2 applies to assets or liabilities for which there are inputs other than quoted prices that are observable for the asset or liability such as quoted prices for similar assets or liabilities in active markets; quoted prices for identical assets or liabilities in markets with insufficient volume or infrequent transactions (less active markets); or model-derived valuations in which significant inputs are observable or can be derived principally from, or corroborated by, observable market data.

Level 3

Level 3 applies to assets or liabilities for which there are unobservable inputs to the valuation methodology that are significant to the measurement of the fair value of the assets or liabilities.


The Company’s financial instruments consist principally of cash, accounts payable, and accrued liabilities. Pursuant to ASC 820 and 825, the fair value of cash is determined based on “Level 1” inputs, which consist of quoted prices in active markets for identical assets. The recorded values of all other financial instruments approximate their current fair values because of their nature and respective maturity dates or durations.


Recently Adopted Accounting Standards 

The Company evaluates the pronouncements of various authoritative accounting organizations, primarily the Financial Accounting Standards Board (“FASB”), the US Securities and Exchange Commission (“SEC”), and the Emerging Issues Task Force (“EITF”), to determine the impact of new pronouncements on US GAAP and the impact on the Company. The Company has recently adopted the following new accounting standards:


Adopted:


In February 2013, the FASB issued ASU No. 2013-02, Reporting of Amounts Reclassified Out of Accumulated Other Comprehensive (ASU 2013-02). This guidance is the culmination of the FASB’s deliberation on reporting reclassification adjustments from accumulated other comprehensive income (AOCI). The amendments in ASU 2013-02 do not change the current requirements for reporting net income or other comprehensive income. However, the amendments require disclosure of amounts reclassified out of AOCI in its entirety, by component, on the face of the statement of operations or in the notes thereto. Amounts that are not required to be reclassified in their entirety to net income must be cross-referenced to other disclosures that provide additional detail. This standard is effective prospectively for annual and interim reporting periods beginning after December 15, 2012. The adoption of this update did not have a material impact on its consolidated financial statements.


In April 2013, the FASB issued ASU No. 2013-07, Presentation of Financial Statements (Top 205): Liquidation Basis of Accounting. The objective of ASU No. 2013-07 is to clarify when an entity should apply the liquidation basis of accounting and to provide principles for the measurement of assets and liabilities under the liquidation basis of accounting, as well as any required disclosures. The amendments in this standard is effective prospectively for entities that determine liquidation is imminent during annual reporting periods beginning after December 15, 2013, and interim reporting periods therein. The adoption of this update did not have a material impact on its consolidated financial statements.



7


In July 2013, the FASB issued ASU No 2013-11, Presentation of an Unrecognized Tax Benefit When Net Operating Loss Carryforward Exists.  The objective of ASU 2013-11 is to reduce diversity in practice by providing guidance on the presentation of unrecognized tax benefits, and will better reflect the manner in which an entity would settle at the reporting date any additional income taxes that would result from the disallowance of a tax position when net operating loss carryforwards, similar tax losses, or tax credit carryforwards exist. The amendments in this Update are effective for fiscal years, and interim periods within those years, beginning after December 15, 2013, and interim reporting periods therein. Early adoption is permitted. The adoption of this update did not have a material impact on its consolidated financial statements.


In June 2014, the FASB issued ASU No, 2014-10, Elimination of Certain Financial Reporting Requirements for Development Stage Entities.  The objective of ASU 2014-10 is to reduce the cost and complexity associated with the incremental reporting requirements for development stage entities.  This Update removes all incremental financial reporting requirements, and eliminates an exception provided to development stage entities in Topic 810.  The amendments in this standard are effective retrospectively for annual reporting periods beginning after December 15, 2014, and interim periods therein. Early adoption is permitted.


Not Yet Adopted:


In April 2014, the FASB issued ASU No. 2014-08 Presentation of Financial Statements (Top 205): Reporting Discontinued Operations and Disclosure of Disposals of Components of an Entity.  The objective of ASU No. 2014-08 is to clarify the criteria for determining which disposals can be presented as discontinued operations and also modifies related disclosure requirements. The standard is required to be adopted by public business entities in annual periods beginning on or after December 15, 2014, and interim periods within those annual periods.  Early adoption is permitted for new disposals beginning in the first quarter of 2014, provided financial statements have not been issued before the release of this standard. The Company is evaluating the effect, if any, adoption of ASU No. 2014-08 will have on its consolidated financial statements.


Recently Issued Accounting Standards Updates: 

There were various updates recently issued, most of which represented technical corrections to the accounting literature or application to specific industries. None of the updates are expected to a have a material impact on the Company's consolidated financial position, results of operations or cash flows.


NOTE 3. PROPERTY AND EQUIPMENT


Property and equipment consists of the following:  

 

September 30, 2014

 

December 31, 2013

 

Office equipment

$

8,385

 

$

8,385

 

Medical devices and instruments

 

45,194

 

 

45,194

 

Sub-total

 

53,579

 

 

53,579

 

Accumulated depreciation

 

(42,471

)

 

(37,728

)

Property and equipment, net

$

11,108

 

$

15,851

 


Depreciation expense for the nine months ended September 30, 2014 and September 30, 2013 was $4,743 and $7,923, respectively.


NOTE 4. INTANGIBLE ASSETS


Intangible assets consists of the following:

 

September 30, 2014

 

December 31, 2013

 

Products and processes

$

12,500

 

$

12,500

 

Trademarks and patents

 

12,500

 

 

12,500

 

Sub-total

 

25,000

 

 

25,000

 

Accumulated amortization

 

(6,664

)

 

(5,416

)

Intangible assets, net

$

18,336

 

$

19,584

 


Amortization expense for the nine months ended September 30, 2014 and September 30, 2013 was $1,248 and $1,248, respectively.


NOTE 5. NOTES AND LOANS PAYABLE


Notes and loans payable consists of the following:

 

September 30, 2014

 

December 31, 2013

 

Notes payable

 

 

 

 

 

 

Phillip Knight

$

9,075

 

$

9,075

 

THI Inc.

 

10,000

 

 

10,000

 

Rast Trade

 

65,000

 

 

65,000

 

 Total notes payable

 

84,075

 

 

84,075

 

 

 

 

 

 

 

 

Loans payable

 

 

 

 

 

 

Regal Capital

 

103,449

 

 

––

[2]

Tom Mackay

 

11,900

 

 

––

[2]

Total loans payable

 

115,349

 

 

––

 

Total notes and loans payable

$

199,424

 

$

84,075

 

 

 

 

 

 

 

 

Convertible notes payable

 

 

 

 

 

 

The Kasper Group, Ltd.

$

144,000

 

$

––

[1]

 

 

 

 

 

 

 


In June 2010, the Company issued a note payable in the principal amount of $9,075 to a non-related party.  Under the terms of the note, the amount is unsecured, non-interest bearing, and due upon demand. As of September 30, 2014, no demand has been made.


In June 2010, the Company issued a note payable in the principal amount of $10,000 to a non-related party. Under the terms of the note, the amount is unsecured, accrues interest at a rate of 8% per annum, and is due upon demand. As of September 30, 2014, no demand has been made.  Interest in the amount of $3,613 and $3,015 has been accrued as of September 30, 2014 and December 31, 2013, respectively, and is included as part of accrued expenses on the accompanying consolidated balance sheets.



8


On April 21, 2011, the Company issued a note payable in the principal amount of $65,000 to a non-related party. The note is unsecured, bears interest at a rate of 10% per annum, and is due upon demand. As of September 30, 2014, no demand has been made. Interest in the amount of $24,059 and $19,197 has been accrued as of September 30, 2014 and December 31, 2013, respectively, and is included as part of accrued expenses on the accompanying consolidated balance sheets.


On September 30, 2010, the Company issued a Convertible Note Payable in the amount of $144,000 to a non-related party pursuant to a Confidential Settlement Agreement.  On January 1, 2012, the note was assigned and purchased by The Kasper Group. Ltd., a former related party, and a new Convertible Promissory Note was issued (the “Kasper Note”). The Kasper Note bears interest at a rate of 7% per annum, is due by January 1, 2015, and contains a repayment provision to convert the debt into common stock of the Company at a rate of $0.25 per share.  On September 30, 2014, the former related party resigned, and the note, included as a related party transaction at December 31, 2013[1], has been reclassified as a non-related party transaction at September 30, 2014. Interest in the amount of $27,699 and $20,160 has been accrued as of September 30, 2014 and December 31, 2013, respectively, and is included as an accrued expense on the accompanying consolidated balance sheets.


Certain loans payable in the aggregate sum of $115,349, previously classified as related party transactions at December 31, 2013[2], were reclassified as non-related party transactions during the current year.  The loans, which were made by former officers of the Company for the purpose of short term overhead requirements, are unsecured, non-interest bearing, and are due upon demand. As of September 30, 2014, no demand has been made.


As at September 30, 2014 and December 31, 2013, interest in the amount of  $55,371 and $42,372, respectively, has been accrued on notes payable, and is included as part of accrued expenses on the accompanying consolidated balance sheets.


NOTE 6. RELATED PARTY TRANSACTIONS


Related party transactions consist of the following:


 

September 30, 2014

 

December 31, 2013

 

Accrued compensation

 

 

 

 

 

 

J. Michael Redmond

$

36,346

 

$

411,827

 

Huntington Chase Financial Group, Ltd.

 

––

[2]

 

300,000

 

MJ Management, LLC

 

68,200

 

 

45,800

 

Tom Mackay

 

––

[3]

 

26,250

 

Gardner Williams

 

––

[3]

 

11,250

 

Total accrued compensation

 

104,546

 

 

795,127

 

 

 

 

 

 

 

 

Cash advances

 

 

 

 

 

 

Edward W. Withrow, III

 

23,763

 

 

11,217

 

Tom Mackay

 

––

[1]

 

11,900

 

Regal Capital Development

 

––

[1]

 

103,449

 

Total cash advances

 

23,763

 

 

126,566

 

Total related party payables

 

128,309

 

 

921,693

 

 

 

 

 

 

 

 

Convertible notes payable

 

 

 

 

 

 

Huntington Chase Financial Group, Ltd.

 

458,600

[2]

 

46,100

 

J. Michael Redmond

 

544,231

 

 

 

 

The Kasper Group, Ltd.

 

––

[1]

 

144,000

 

Total convertible notes payable

 

1,002,831

 

 

190,100

 

Less: unamortized discount

 

(382,441

)

 

––

 

Total convertible note payable, net of discount

 

620,390

 

 

190,100

 

 

 

 

 

 

 

 

Total related party transactions

$

748,699

 

$

1,111,793

 

 

 

 

 

 

 

 

[1] See Note 5

 

 

 

 

 

 


On November 15, 2010, the Company entered into an employment agreement with its CEO, Mr. J. Michael Redmond (the “Employment Agreement”). Under the Employment Agreement, Mr. Redmond agrees to serve as the President, CEO, and Director of the Company for a term of three years. As compensation for his services, Mr. Redmond’s base salary will be $200,000 per annum for the first year, increasing to $225,000 in year 2, and $250,000 in year 3, contingent upon the Company meeting certain goals. In addition, Mr. Redmond was granted one million three hundred seventy five thousand (1,375,000) options at an exercise price of $0.10 per share. As of December 31, 2013, $411,827 was recorded as accrued compensation. On July 31, 2014, a convertible promissory note was issued to Mr. Redmond in the principal sum of $544,231, representing all compensation owed to Mr. Redmond through July 31, 2014. The note bears interest at a rate of 5% per annum, is due by July 31, 2015, and contains a repayment provision to convert the debt into common stock of the Company at a strike price of $0.10. The conversion price of $0.10 results in a beneficial conversion feature.  As a result, the difference between the conversion rate and the market rate of $326,539 has been classified as a discount on the note.  During the three months ended September 30, 2014, the Company has expensed $54,423 in discount amortization, for a total of $54,423 in discount amortization expensed through September 30, 2014.  As of September 30, 2014, $272,116 of unamortized discount remains, and will be amortized over the next 10 months. In addition, unpaid compensation not included in the note of $36,346 has been recorded as accrued compensation as of September 30, 2014.  As of September 30, 2014, interest in the amount of $4,548 has been accrued, and is included as part of accrued expenses on the accompanying consolidated balance sheets.


On January 2, 2012, the Company entered into a consulting agreement with Huntington Chase Financial Group LLC (“HCFG”), a Nevada corporation, whose principal is a related party. The consulting agreement provides for HCFG to provide advisory services to the Company for a period of three years for a fee of $12,500 per month, which has been deferred until such time as the Company reaches certain funding goals. As of September 30, 2014 and December 31, 2013, respectively, $412,500 and $300,000 and in compensation is owing under this Agreement.  On September 30, 2014, the Company modified the Convertible Note Payable issued to HCFG dated December 31, 2012, to  increase the principal to $458,600[2], to include all unpaid compensation due HCFG through September 30, 2014.  The note bears interest at a rate of 7% per annum, is due by December 31, 2015, and contains a repayment provision to convert the debt into common stock of the Company at a strike price of $0.10. The conversion price of $0.10 results in a beneficial conversion feature.  As a result, the difference between the conversion rate and the market rate of $146,955 has been classified as a discount on the note.  During the three months ended September 30, 2014, the Company has expensed $20,190 in discount amortization, for a total of $36,630 in discount amortization expensed through September 30, 2014.  As of September 30, 2014, $110,325 of unamortized discount remains, and will be amortized over the next 18 months. As of September 30, 2014 and December 31, 2013, respectively, interest in the amount of $17,754 and $2,834 has been accrued, and is included as part of accrued expenses on the accompanying consolidated balance sheets.


Certain accrued compensation in the aggregate sum of $37,500, previously classified as related party transactions at December 31, 2013[3], was reclassified as non-related party transactions during the current year.  The accrued compensation, owed to former officers of the Company, is included as part of accrued expenses on the accompanying balance sheet as of September 30, 2014.



9


As at September 30, 2014 and December 31, 2013, respectively, related party payables of $128,309 and $921,693 consist of $104,546 and $795,127 in accrued compensation, and $23,763 and $126,566 in cash advances to the Company for operating expenses.  The amounts owing are unsecured, non-interest bearing, and due upon demand. Convertible notes payable to related parties, net of unamortized discount, were $620,390 and $190,100 as of September 30, 2014 and December 31, 2013, respectively.  The notes bear interest at a rate of 7% per annum and mature between July 31, 2015 and December 31, 2015. As of September 30, 2014 and December 31, 2013, the total amounts due to related parties are $748,699 and $1,111,793, respectively.


As at September 30, 2014 and December 31, 2013, interest in the amount of $22,302 and $2,834, respectively, of interest has been accrued on related party notes payable, and is included as part of accrued expenses on the accompanying consolidated balance sheets.


NOTE 7. CONVERTIBLE PREFERRED STOCK


The total number of authorized shares of preferred stock that may be issued by the Company is 10,000,000 with a par value of $0.001 per share.


All preferred shares are convertible into the Company’s common stock at a rate of 20 shares of common stock for each preferred share held, and were issued with 100% warrant coverage (Note 9).  The number of shares of common stock underlying the warrants and the exercise price are subject to adjustment upon certain events.


As of September 30, 2014 and December 31, 2013, the Company had 823,691 shares of preferred stock issued and outstanding.


NOTE 8. COMMON STOCK


The total number of authorized shares of common stock that may be issued by the Company is 250,000,000 with a par value of $0.001 per share.  


As of September 30, 2014 and December 31, 2013, the Company has 132,026,053 and 162,765,837 common shares issued and outstanding, respectively.


NOTE 9. WARRANTS AND OPTIONS


As of September 30, 2014, the Company had 16,473,401 warrants and 1,900,000 options issued and outstanding.


Warrants Outstanding

 

 

 

Number of

 

Remaining

 

Exercise Price

 

Weighted

 

 

 

Common

 

Contractual Life

 

times Number

 

Average

 

Exercise Price

 

Shares

 

(in years)

 

of Shares

 

Exercise Price

 

 

 

 

 

 

 

 

 

 

 

 

$0.27518

 

14,535,706

 

0.69

 

$

4,000,000

 

$0.27518

 

$0.41278

 

726,785

 

0.99

 

 

300,000

 

$0.41278

 

$0.41278

 

726,785

 

1.17

 

 

300,000

 

$0.41278

 

$0.41278

 

484,125

 

1.58

 

 

199,837

 

$0.41278

 

 

 

16,473,401

 

 

 

$

4,799,837

 

$0.41278

 


Warrant Activity

 

 

 

 

 

Number of

 

Weighted Average

 

 

Shares

 

Exercise Price

 

Outstanding at December 31, 2013

16,473,401

 

$0.41278

 

Issued

––

 

––

 

Exercised

––

 

––

 

Expired / Cancelled

––

 

––

 

Outstanding at September 30, 2014

16,473,401

 

$0.41278

 


Options Outstanding

 

 

 

 

Remaining

 

Exercise Price

 

Weighted

 

 

 

Number of

 

Contractual Life

 

times Number

 

Average

 

Exercise Price

 

Shares

 

(in years)

 

of Shares

 

Exercise Price

 

 

 

 

 

 

 

 

 

 

 

 

$0.10

 

1,375,000

 

6.25

 

$

137,500

 

$0.10

 

$0.25

 

225,000

 

1.50

 

 

56,250

 

$0.25

 

$0.25

 

225,000

 

1.33

 

 

56,250

 

$0.25

 

 

 

1,900,000

 

 

 

$

250,000

 

$0.20

 


Options Activity

 

 

 

 

 

Number of

 

Weighted Average

 

 

Shares

 

Exercise Price

 

Outstanding at December 31, 2013

1,900,000

 

$0.20

 

Issued

––

 

––

 

Exercised

––

 

––

 

Expired / Cancelled

––

 

––

 

Outstanding at September 30, 2014

1,900,000

 

$0.20

 


NOTE 10. INCOME TAXES


The components of the cumulative net deferred tax asset at September 30, 2014 and December 31, 2013, the statutory tax rate, the effective tax rate and the amount of the valuation allowance are indicated below:


 

September 30, 2014

 

December 31, 2013

 

 

 

 

 

 

 

 

Income (loss) before taxes

$

(480,716

)

$

(504,494

)

Statutory rate

 

34%

 

 

34%

 

 

 

 

 

 

 

 

Computed expected tax payable (recovery)

$

163,500

 

$

171,500

 

Non-deductible expenses

 

––

 

 

––

 

Change in valuation allowance

 

(163,500

)

 

(171,500

)

 

 

 

 

 

 

 

Reported income taxes

$

––

 

$

––

 



10


The significant components of deferred income tax assets and liabilities at September 30, 2014 and December 31, 2013 are as follows:


 

September 30, 2014

 

December 31, 2013

 

 

 

 

 

 

 

 

Net operating loss carried forward

 $

806,000

 

$

642,500

 

 

 

 

 

 

 

 

Valuation allowance

 

(806,000

)

 

(642,500

)

 

 

 

 

 

 

 

Net deferred income tax asset

 $

––

 

$

––

 


As at September 30, 2014, the Company had approximately $2,370,000 of federal net operating losses which expire commencing in the year 2026.


NOTE 11. SUBSEQUENT EVENTS


On April 17, 2014, pursuant to a resolution of the board of directors, the Company executed an Agreement to Purchase One Hundred Percent of the Issued and Outstanding Shares of a California-based pharmacy Corporation (the “Pharmacy”) and its Assets and Inventory (the “Purchase Agreement”) between the Company, the Pharmacy and its sole shareholder (the “Seller”). The fully executed Purchase Agreement is dated March 27, 2014 and was received from the Seller on April 17, 2014.

 

Pursuant to the Purchase Agreement, in exchange for 100% of the Pharmacy’s common stock and 100% of the Pharmacy’s Assets and Inventory, among other things, the Company shall deliver to the Seller by, or prior to, the Closing Date:


·

Cash in the amount of $15 million;

·

A subordinate Promissory Note in the amount of $5 million, bearing interest at a rate of 6% per annum commencing three (3) years from the date of the Promissory Note, to be repaid after the senior credit facility has been paid in full, over a period of twelve (12) months; and 

·

An ownership of Common Stock in the Company, representing approximately 9.9% of the issued and outstanding stock in the Company on a fully diluted basis.


Certain terms and conditions of the Purchase Agreement remain confidential pursuant to a written non-disclosure agreement with the Seller until the Closing.  The Closing is subject to the Company obtaining the necessary financing and the required regulatory approval for the acquisition of the Pharmacy.


On July 15, 2014, the Company and the Pharmacy executed an amendment to the Purchase Agreement which, among other things, extended the Closing Date to July 31, 2014. The Company is currently working in good faith with the Pharmacy to obtain regulatory approval from the California State Board of Pharmacy (the “State Board”). The Company has submitted its pharmacy license application to the State Board, and is awaiting approval of its temporary permit. Along with the Company’s application, the Pharmacy provided the State Board with a Seller’s Certification, which attests to the Pharmacy’s involvement in the pending transaction with the Company.  The parties expect to formalize an extension as approval from the State Board nears completion. The Company and the Pharmacy continue to work together closely to bring this transaction to a close as soon as possible.


In the event that the Company does not obtain the requisite financing and regulatory approval, the transaction will not occur without a modification mutually acceptable to both parties.


On April 30, 2014, the Company entered into an Agreement with KeyBanc Capital Markets, Inc. (“KBCM”) for the purpose of introducing the Company to representatives of Potential Lenders/Investors for the financing required to purchase the Pharmacy. In exchange for KBCM”s services, the Company shall pay KBCM a fee equal to 1.5% of the aggregate dollar amount of any loan or commitment to lend and/or invest amounts provided to the Company by the Potential Lenders/Investors. The Fee shall be payable upon i) the closing of a credit and/or investment agreement or ii) the execution by the Potential Lenders/Investors and the Company of a commitment document for a loan or investment.



*    *    *    *    *



11



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


Forward-Looking Statements


This quarterly report contains forward-looking statements. These statements relate to future events or the Company’s future financial performance. In some cases, you can identify forward-looking statements by terminology such as "may", "should", "expects", "plans", "anticipates", "believes", "estimates", "predicts", "potential" or "continue" or the negative of these terms or other comparable terminology. These statements are only predictions and involve known and unknown risks, uncertainties and other factors, including the risks in the section entitled "Risk Factors” that may cause the Company or the Company’s industry's actual results, levels of activity, performance or achievements to be materially different from any future results, levels of activity, performance or achievements expressed or implied by these forward-looking statements.


Although the Company believes that the expectations reflected in the forward-looking statements are reasonable, the Company cannot guarantee future results, levels of activity, performance or achievements. Except as required by applicable law, including the securities laws of the United States, the Company does not intend to update any of the forward-looking statements to conform these statements to actual results.


The Company’s unaudited financial statements are stated in United States Dollars (US$) and are prepared in accordance with United States Generally Accepted Accounting Principles. The following discussion should be read in conjunction with the Company’s financial statements and the related notes that appear elsewhere in this quarterly report.


In this quarterly report, unless otherwise specified, all dollar amounts are expressed in United States dollars. All references to "common shares" refer to the common shares in the Company’s capital stock.


As used in this quarterly report, the terms "we", "us", "our" and "Parallax" mean Parallax Health Sciences, Inc. (formerly Endeavor Power Corp.), and its wholly-owned subsidiary, Endeavor Sciences, Inc. (formerly Parallax Diagnostics, Inc.), unless otherwise indicated.


Corporate History and Overview


The Company was incorporated in the State of Nevada on July 6, 2005, and began its activities in the field of online website design and commerce. In September 2007, it merged with Endeavor Uranium, Inc. and began activities in the mineral exploration field, with mineral properties in the northwestern United States.  On December 23, 2008, the Company entered into a Joint Venture Agreement with Federated Energy Corporation, a Tennessee corporation, for working interests in prospective oil and gas wells, and changed its operating name to Endeavor Power Corporation. The Company’s activities in oil and gas exploration continued until November, 2010.


In November 2010, management assessed a potential business opportunity and determined that in an effort to create value for its Shareholders, the Company should change its business direction. On November 8, 2010, the Company discontinued its operations in its working interests in oil and gas exploration and changed its operating focus to E-Waste processing services aimed at industrial and government clients.  The Company’s new direction sought to limit the impact of discarded “E-Waste” on the environment, as discarded computers and electronic equipment pose environmental hazards.  However, in accordance with a change in management effective September 27, 2011, the Company’s business operations changed, and its activities in the e-waste were discontinued.


The Company began developing activities in managerial services, and pursued potential funding opportunities for the Company. It also retained consultants to perform due diligence on certain mining properties located in Venezuela, Brazil, Bolivia, Guyana and several other South American countries. Management, however, determined that the outcome of such due diligence did not provide the Company a viable opportunity and that it did not provide sufficient economic benefit for the Company. Management therefore ceased its due diligence, and continued its operations in managerial services whilst pursuing other viable business opportunities to increase shareholder value.


During 2012, the Company’s management entered discussions and assessed a potential business opportunity with Parallax Diagnostics, Inc., a Nevada corporation (“Parallax’), whose principal business is in the bio-medical sector. More specifically, Parallax is focused on the exploitation of a proprietary diagnostic and monitoring platform and processes in the area of infectious disease.  Parallax holds the right, title, and interest to certain FDA 510(k) approved tests in perpetuity. In addition, Parallax acquired the exclusive license to a suite of medical devices, tests and utility processes in perpetuity.


On November 1, 2012, the Company, and its wholly owned subsidiary Endeavor Holdings, Inc. entered into an Agreement and Plan of Merger (the “Merger Agreement”) with Parallax and the shareholders of Parallax.  As a result of the transactions effected by the Merger Agreement, (i) Parallax merged with and into Endeavor Holdings whereupon Endeavor Holdings continued as the surviving entity and the corporate existence of Parallax ceased; (ii) the former business of Parallax is now the Company’s primary business, (iii) the Company’s existing business in managerial services will continue as ancillary operations,  and (iv) there is a change of control whereby the former shareholders of Parallax now own a controlling 60% ownership interest in the Company on a fully diluted basis. On November 26, 2012, Parallax Diagnostic, Inc. changed its name to Endeavor Sciences, Inc. (“ESI”), a wholly owned subsidiary of Parallax Health Sciences, Inc., (formerly Endeavor Power Corp.)  


On July 22, 2013, the Company entered into a binding Letter of Intent for the acquisition of a privately held California corporation, whose primary operations are in the pharmaceutical industry (the “Pharmacy”).   On April 17, 2014, pursuant to a resolution of the board of directors, the Company executed an Agreement to Purchase One Hundred Percent of the Issued and Outstanding Shares of the Pharmacy and its Assets and Inventory (the “Purchase Agreement”) between the Company, the Pharmacy and its sole shareholder (the “Seller”). The fully executed Purchase Agreement is dated March 27, 2014 and was received from the Seller on April 17, 2014.

 

Pursuant to the Purchase Agreement, in exchange for 100% of the Pharmacy’s common stock and 100% of the Pharmacy’s Assets and Inventory, among other things, the Company shall deliver to the Seller by, or prior to, the Closing Date, which shall be no later than July 15, 2014:


1.

Cash in the amount of $15 million;

2.

A subordinate Promissory Note in the amount of $5 million, bearing interest at a rate of 6% per annum commencing three (3) years from the date of the Promissory Note, to be repaid after the senior credit facility has been paid in full, over a period of twelve (12) months; and 

3.

An ownership of Common Stock in the Company, representing approximately 9.9% of the issued and outstanding stock in the Company on a fully diluted basis.


Certain terms and conditions of the Purchase Agreement remain confidential pursuant to a written non-disclosure agreement with the Seller until the Closing.  The Closing is subject to the Company obtaining the necessary financing and the required regulatory approval for the acquisition of the Pharmacy.


On July 15, 2014, the Company and the Pharmacy executed an amendment to the Purchase Agreement which, among other things, extended the Closing Date to July 31, 2014. The Company is currently working in good faith with the Pharmacy to obtain regulatory approval from the California State Board of Pharmacy (the “State Board”). The Company has submitted its pharmacy license application to the State Board, and is awaiting approval of its temporary permit. Along with the Company’s application, the Pharmacy provided the State Board with a Seller’s Certification, which attests to the Pharmacy’s involvement in the pending transaction with the Company.  The parties expect to formalize an extension as approval from the State Board nears completion. The Company and the Pharmacy continue to work together closely to bring this transaction to a close as soon as possible.


In the event that the Company does not obtain the requisite financing and regulatory approval, the transaction will not occur without a modification mutually acceptable to both parties.



12



On January 9, 2014, the Company changed its name from Endeavor Power Corp. (OTCQB.EDVP) to Parallax Health Sciences, Inc. (OTCQB.PRLX)


The following summary of the Company’s financial condition should be read in conjunction with the consolidated financial statements for the quarter ended September 30, 2014, which are included herein.


Balance Sheet

 

As at September 30, 2014, the Company had total assets of $29,547, compared with total assets of $36,004 as at December 31, 2013. The decrease in total assets of $6,457 is attributable to a decrease in cash of $466, $4,743 of depreciation related to equipment, and $1,248 of amortization related to the intangible assets.  

 

As at September 30, 2014, the Company had total liabilities of $1,370,586, compared with $1,369,921 as at December 31, 2013. The increase in total liabilities of $665 is attributable to an increase of $104,410 in accounts payable and accrued expenses, an increase of $115,349 in notes and loans payable, an increase of $144,000 in convertible notes payable, a decrease of $793,384 in related party payables, and an increase of $430,290 in convertible related party loans, net of unamortized discount.


Results of Operations


Three and nine months ended September 30, 2014 compared to three and nine months ended September 30, 2013


The financial information provided includes the accounts of the Company and its wholly owned subsidiary, Endeavor Sciences, Inc., formerly Parallax Diagnostics, Inc. (“ESI”), on a consolidated basis.  All significant inter-company accounts and transactions have been eliminated.  


 

For the three months ended

 

For the nine months ended

 

 

September 30, 2014

 

September 30, 2013

 

September 30, 2014

 

September 30, 2013

 

Revenue

$

––

  

$

––

  

$

––

  

$

––

  

Cost of sales

$

––

  

$

––

  

$

––

  

$

––

  

Gross profit (loss)

$

––

  

$

––

 

$

––

  

$

––

 

General and administrative expenses

$

129,179

  

$

107,864

  

$

351,205

  

$

338,358

  

Operating (loss)

$

(129,179

)

$

(107,864

)

$

(351,205

)

$

(338,358

)

Insurance claim refund

$

––

 

$

––

 

$

––

 

$

1,695

 

Depreciation and amortization

$

(1,997

)

$

(3,057

)

$

 (5,991

)

$

 (9,171

)

Amortization of deferred compensation

$

––

 

$

42,580

 

$

––

 

$

––

 

Interest expense

$

(90,971

)

$

(4,959

)

$

 (123,520

)

$

 (15,360

)

Net (loss)

$

(222,147

)

$

(73,300

)

$

 (480,716

)

$

 (361,194

)


Revenue


For the three months ended September 30, 2014 and 2013, no revenue was generated.


For the nine months ended September 30, 2014 and 2013, no revenue was generated.


The Company has not yet launched its major business activity, which is medical diagnostics and testing.


Cost of sales


For the three months ended September 30, 2014 and 2013, no costs of sales were incurred.  


For the nine months ended September 30, 2014 and 2013, no costs of sales were incurred.  


The Company has not yet launched its major business activity, which is medical diagnostics and testing.


General and Administrative Expenses

 

For the three months ended

 

For the nine months ended

 

Variances

 

  

September 30, 2014

 

September 30, 2013

 

September 30, 2014

 

September 30, 2013

 

3-Month

 

9-Month

 

Legal, accounting, and management services

$

67,605

 

$

46,750

 

$

169,079

 

$

145,111

 

$

20,855

 

$

23,968

 

Salaries, taxes and benefits

 

61,485

 

 

60,756

 

 

181,659

 

 

184,360

 

 

729

 

 

(2,701

)

Office supplies and miscellaneous expenses

  

89

 

 

358

 

 

466

 

 

8,887

 

 

(269

)

 

(8,421

)

Total general and administrative expenses

$

129,179

 

$

107,864

 

$

351,205

 

$

338,358

 

$

21,315

 

$

12,846

 


During the three months ended September 30, 2014, the Company incurred operating expenses totaling $129,179, compared with $107,864 for the three months ended September 30, 2013. The increase in operating expenses of $21,315 is attributable to:


·

an increase in legal, accounting and management fees of $20,855 due to an increase in legal fees of $855; and an increase in outside consulting fees of $20,000 due to hiring additional staff support;

·

an increase in salaries, taxes and benefits of $729 due to an increase in payroll tax expense; and

·

a decrease in office supplies and miscellaneous expenses of $269, due to a decrease in miscellaneous office expenses.



13


During the nine months ended September 30, 2014, the Company incurred operating expenses totaling $351,205, compared with $338,358 for the nine months ended September 30, 2013. The increase in operating expenses of $12,846 is attributable to:


·

an increase in legal, accounting and management fees of $23,968 due to an increase in legal fees of $3,968; and an increase in outside consulting fees of $20,000 due to hiring additional staff support;

·

a decrease in salaries, taxes and benefits of $2,701 due to a decrease in payroll tax expense; and

·

a decrease in office supplies and miscellaneous expenses of $8,421, due to a decrease in filing fees of $4,793 due to a change in service provider; a decrease in publicity and promotion of $2,560; and a decrease in other miscellaneous office expenses of $1,068.


Net Loss

 

During the three months ended September 30, 2014, the Company incurred a net loss of $222,147, compared with a net loss of $73,300 for the three months ended September 30, 2013. The increase in net loss of $148,847 is primarily attributable to an increase in general and administrative expenses of $21,315, a decrease in depreciation and amortization of $1,060, a decrease in amortization of stock compensation of $42,580, and an increase in interest expense of $86,012.


During the nine months ended September 30, 2014, the Company incurred a net loss of $480,716, compared with a net loss of $361,194 for the nine months ended September 30, 2013. The increase in net loss of $119,522 is primarily attributable to an increase in general and administrative expenses of $12,847, a decrease in insurance income of $1,695, a decrease in depreciation and amortization of $3,180, and an increase in interest expense of $108,160.


Liquidity and Capital Resources


Working Capital

 

 

 

 

Increase

 

  

At September 30, 2014

 

At December 31, 2013

 

(Decrease)

 

Current Assets

$

103

 

$

569

 

$

 (466

)

Current Liabilities

 

1,022,311

 

  

1,179,821

 

 

(157,510

)

Working Capital (Deficit)

$

(1,022,208

)

$

 (1,179,252

)

$

157,044

 


As at September 30, 2014, the Company had cash in the amount of $103 compared to $569 as of December 31, 2013.   


The Company had a working capital deficit of $1,022,208 as of September 30, 2014, compared to a working capital deficit of $1,179,252 as of December 31, 2013. The decrease in working capital deficit of $157,044 is primarily attributable to a decrease in cash of $466; an increase in accounts payable and accrued expenses of $104,410; an increase in notes and loans payable of $115,349; an increase of $144,000 in convertible notes payable, an increase in related party convertible notes payable of $272,115; and a decrease in related party payables of $793,384.


Cash Flows

 

  

 

 

 

  

For the nine months ended

  

Increase

 

  

September 30, 2014

 

September 30, 2013

  

(Decrease)

 

Net cash used in operating activities

$

(466

)

$

(25,598

)

$

25,132

 

Net cash used in investing activities

  

––

 

  

––

 

 

––

 

Net cash provided by financing activities

  

––

 

 

17,600

  

 

(17,600

)

Increase (decrease) in cash

$

(466

)

$

(7,998

)

$

7,532

 


Cash Flows from Operating Activities


During the nine months ended September 30, 2014, the Company used $466 of cash flow for operating activities compared with $25,598 for the nine months ended September 30, 2013. The decrease in cash used for operating activities of $25,132 is attributable an increase in net loss of $119,522, a decrease in depreciation and amortization expense of $3,180, an increase in discount amortization of $91,053, an increase in accruals converted to related party loans of $244,904, an increase in accounts payable and accrued expenses of $45,611, and a decrease in related party payables of $233,734.


Cash Flows from Investing Activities


During the nine months ended September 30, 2014 and 2013, the Company had no cash flows from investing activities.


Cash Flows from Financing Activities


During the nine months ended September 30, 2014, the Company had no cash flows from financing activities, compared with $17,600 during the same period last year. The decrease in cash flows provided from financing activities of $17,600 is attributable to a decrease in related party loans.


During the nine months ended September 30, 2014, the Company did not receive any proceeds from the issuance of common shares or other equity instruments.


Future Financings

 

The Company has suffered recurring losses from operations. The continuation of the Company’s operations is dependent upon the Company’s attaining and maintaining profitable operations and raising additional capital as needed. The Company anticipates that it will have to raise additional funds through private placements of the Company’s equity securities and/or debt financing to complete its business plan.


The Company will require additional financing in order to proceed with its plan of operations, including approximately $2,000,000 over the next 12 months to pay for its ongoing expenses. These cash requirements include working capital, general and administrative expenses, the development of the Company’s product line, and the pursuit of acquisitions. These cash requirements are in excess of the Company’s current cash and working capital resources. Accordingly, the Company will require additional financing in order to continue operations and to repay its liabilities. There is no assurance that the financing will be completed as planned or at all. If the Company is unable to secure adequate capital to continue the Company’s planned operations, the Company’s shareholders may lose some or all of their investment and the Company’s business may fail.


The Company anticipates continuing to rely on equity sales of its common stock in order to continue to fund its business operations. Issuances of additional shares will result in dilution to the Company’s existing stockholders. There is no assurance that the Company will achieve any additional sales of its equity securities or arrange for debt or other financing to fund its planned business activities.

 



14


Contractual Obligations


The Company is a smaller reporting company as defined by Rule 12b-2 of the Securities Exchange Act of 1934 and is not required to provide the information under this item.


Going Concern


The Company has incurred losses since inception resulting in an accumulated deficit of $2,374,262, and further losses are anticipated. The Company’s ability to continue as a going concern is dependent upon its ability to generate profitable operations in the future and/or to obtain the necessary financing to meet its obligations and repay its liabilities arising from normal business operations when they come due, which may not be available at commercially reasonable terms  There can be no assurance that the Company will be able to continue to raise funds, in which case the Company may be unable to meet its obligations and the Company may cease operations. These factors, among others, raise substantial doubt about the Company’s ability to continue as a going concern.


The consolidated unaudited financial statements included with this annual report have been prepared on the going concern basis which assumes that adequate sources of financing will be obtained as required and that the Company’s assets will be realized and liabilities settled in the ordinary course of business. Accordingly, the consolidated unaudited financial statements do not include any adjustments related to the recoverability of assets and classification of assets and liabilities that might be necessary should the Company be unable to continue as a going concern.

 

Off-Balance Sheet Arrangements


The Company has no significant off-balance sheet arrangements that have or are reasonably likely to have a current or future effect on the Company’s financial condition, changes in financial condition, revenues or expenses, results of operations, liquidity, capital expenditures or capital resources that are material to stockholders.


Critical Accounting Policies


The discussion and analysis of the Company’s financial condition and results of operations are based upon the Company’s consolidated unaudited financial statements, which have been prepared in accordance with the accounting principles generally accepted in the United States of America. Preparing financial statements requires management to make estimates and assumptions that affect the reported amounts of assets, liabilities, revenue, and expenses. These estimates and assumptions are affected by management’s application of accounting policies. The Company believes that understanding the basis and nature of the estimates and assumptions involved with the following aspects of the Company’s financial statements is critical to an understanding of its consolidated financial statements.


Net Income (Loss) Per Share

The Company computes earnings per share under Accounting Standards Codification subtopic 260-10, Earnings Per Share (“ASC 260-10”). Net earnings (loss) per common share is computed by dividing net income (loss) by the weighted average number of shares of common stock and dilutive common stock equivalents outstanding during the period. Dilutive common stock equivalents consist of shares issuable upon conversion of convertible preferred shares and the exercise of the Company’s stock options and warrants.


Use of Estimates

The preparation of financial statements in conformity with generally accepted accounting principles in the United States and requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. The Company regularly evaluates estimates and assumptions, and deferred income tax asset valuation allowances. The Company bases its estimates and assumptions on current facts, historical experience and various other factors that it believes to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities and the accrual of costs and expenses that are not readily apparent from other sources. The actual results experienced by the Company may differ materially and adversely from the Company’s estimates. To the extent there are material differences between the estimates and the actual results, future results of operations will be affected.


Principles of Consolidation

The consolidated financial statements include the accounts of the Company and its wholly owned subsidiary, Endeavor Sciences, Inc., formerly Parallax Diagnostics, Inc. (“ESI”).  All significant inter-company accounts and transactions have been eliminated.


In November 2012, the Company acquired 100% of ESI’s common stock in exchange for, among other things, approximately 60% of the Company’s common stock (the “Share Exchange”). As a result of the Share Exchange, a change in control occurred whereby the Company is the legal parent/accounting subsidiary of ESI, and ESI is the legal subsidiary/accounting parent of the Company.  The Share Exchange has therefore been identified and recorded as a reverse acquisition and, pursuant to ASC 805-40-45-1, the consolidated financial statements’ historical and cumulative data are a continuation of the financial statements of the legal subsidiary, ESI. For cumulative purposes, the date of inception is that of ESI, December 30, 2008.


Revenue Recognition

The Company recognizes revenue in accordance with ASC 605, Revenue Recognition. Revenue is recognized only when the price is fixed or determinable, persuasive evidence of an arrangement exists, the service has been provided, and collectability is reasonably assured.  


Stock-Based Compensation

The Company records stock-based compensation in accordance with ASC 718, Share-Based Payments, using the fair value method. All transactions in which goods or services are the consideration received for the issuance of equity instruments are accounted for based on the fair value of the consideration received or the fair value of the equity instrument issued, whichever is more reliably measurable. Equity instruments issued to employees and the cost of the services received as consideration are measured and recognized based on the fair value of the equity instruments issued.


Recently Adopted Accounting Standards

The Company evaluates the pronouncements of various authoritative accounting organizations, primarily the Financial Accounting Standards Board (“FASB”), the US Securities and Exchange Commission (“SEC”), and the Emerging Issues Task Force (“EITF”), to determine the impact of new pronouncements on US GAAP and the impact on the Company. The Company has recently adopted the following new accounting standards:




15


Adopted:


In February 2013, the FASB issued ASU No. 2013-02, Reporting of Amounts Reclassified Out of Accumulated Other Comprehensive (ASU 2013-02). This guidance is the culmination of the FASB’s deliberation on reporting reclassification adjustments from accumulated other comprehensive income (AOCI). The amendments in ASU 2013-02 do not change the current requirements for reporting net income or other comprehensive income. However, the amendments require disclosure of amounts reclassified out of AOCI in its entirety, by component, on the face of the statement of operations or in the notes thereto. Amounts that are not required to be reclassified in their entirety to net income must be cross-referenced to other disclosures that provide additional detail. This standard is effective prospectively for annual and interim reporting periods beginning after December 15, 2012. The adoption of this update did not have a material impact on its consolidated financial statements.


In April 2013, the FASB issued ASU No. 2013-07, Presentation of Financial Statements (Top 205): Liquidation Basis of Accounting. The objective of ASU No. 2013-07 is to clarify when an entity should apply the liquidation basis of accounting and to provide principles for the measurement of assets and liabilities under the liquidation basis of accounting, as well as any required disclosures. The amendments in this standard is effective prospectively for entities that determine liquidation is imminent during annual reporting periods beginning after December 15, 2013, and interim reporting periods therein. The adoption of this update did not have a material impact on its consolidated financial statements.


In July 2013, the FASB issued ASU No 2013-11, Presentation of an Unrecognized Tax Benefit When Net Operating Loss Carryforward Exists.  The objective of ASU 2013-11 is to reduce diversity in practice by providing guidance on the presentation of unrecognized tax benefits, and will better reflect the manner in which an entity would settle at the reporting date any additional income taxes that would result from the disallowance of a tax position when net operating loss carryforwards, similar tax losses, or tax credit carryforwards exist. The amendments in this Update are effective for fiscal years, and interim periods within those years, beginning after December 15, 2013, and interim reporting periods therein. Early adoption is permitted. The adoption of this update did not have a material impact on its consolidated financial statements.


In June 2014, the FASB issued ASU No, 2014-10, Elimination of Certain Financial Reporting Requirements for Development Stage Entities.  The objective of ASU 2014-10 is to reduce the cost and complexity associated with the incremental reporting requirements for development stage entities.  This Update removes all incremental financial reporting requirements, and eliminates an exception provided to development stage entities in Topic 810.  The amendments in this standard are effective retrospectively for annual reporting periods beginning after December 15, 2014, and interim periods therein. Early adoption is permitted.


Not Yet Adopted:


In April 2014, the FASB issued ASU No. 2014-08 Presentation of Financial Statements (Top 205): Reporting Discontinued Operations and Disclosure of Disposals of Components of an Entity.  The objective of ASU No. 2014-08 is to clarify the criteria for determining which disposals can be presented as discontinued operations and also modifies related disclosure requirements. The standard is required to be adopted by public business entities in annual periods beginning on or after December 15, 2014, and interim periods within those annual periods.  Early adoption is permitted for new disposals beginning in the first quarter of 2014, provided financial statements have not been issued before the release of this standard. The Company is evaluating the effect, if any, adoption of ASU No. 2014-08 will have on its consolidated financial statements.


Recently Issued Accounting Standards Updates: 

There were various updates recently issued, most of which represented technical corrections to the accounting literature or application to specific industries. None of the updates are expected to a have a material impact on the Company's consolidated financial position, results of operations or cash flows.


ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK


The Company is a smaller reporting company as defined by Rule 12b-2 of the Securities Exchange Act of 1934 and is not required to provide the information under this item.


ITEM 4. CONTROLS AND PROCEDURES


Management’s Report on Disclosure Controls and Procedures


The Company maintains disclosure controls and procedures that are designed to ensure that information required to be disclosed in the Company’s reports filed under the Securities Exchange Act of 1934, as amended, is recorded, processed, summarized and reported within the time periods specified in the Securities and Exchange Commission's rules and forms, and that such information is accumulated and communicated to the Company’s management, including the Company’s president, chief executive officer and chief financial officer to allow for timely decisions regarding required disclosure. In designing and evaluating the Company’s disclosure controls and procedures, the Company’s management recognizes that any controls and procedures, no matter how well designed and operated, can provide only reasonable assurance of achieving the desired control objectives, and the Company’s management is required to apply its judgment in evaluating the cost-benefit relationship of possible controls and procedures. Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Therefore, even those systems determined to be effective can provide only reasonable assurance with respect to financial statement preparation and presentation. Projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.


As of September 30, 2014, the end of the Company’s period covered by this quarterly report, the Company carried out an evaluation, under the supervision and with the participation of the Company’s president, chief executive officer and chief financial officer of the effectiveness of the design and operation of the Company’s disclosure controls and procedures. Based on the foregoing, the Company’s president, chief executive officer and chief financial officer concluded that the Company’s disclosure controls and procedures were effective as of the end of the period covered by this quarterly report.


Changes in Internal Control over Financial Reporting


There have been no changes in the Company’s internal controls over financial reporting that occurred during the three month period ended September 30, 2014 that have materially or are reasonably likely to materially affect, the Company’s internal controls over financial reporting.



16


Audit Committee


The Company’s Board of Directors has not established an audit committee. The respective role of an audit committee has been conducted by the Company’s Board of Directors. The Company intends to establish an audit committee during the year 2014. When established, the audit committee's primary function will be to provide advice with respect to the Company’s financial matters and to assist the Company’s Board of Directors in fulfilling its oversight responsibilities regarding finance, accounting, and legal compliance. The audit committee's primary duties and responsibilities will be to: (i) serve as an independent and objective party to monitor the Company’s financial reporting process and internal control system; (ii) review and appraise the audit efforts of the Company’s independent accountants; (iii) evaluate the Company’s quarterly financial performance as well as its compliance with laws and regulations; (iv) oversee management's establishment and enforcement of financial policies and business practices; and (v) provide an open avenue of communication among the independent accountants, management and the Company’s Board of Directors.




PART II

OTHER INFORMATION


ITEM 1. LEGAL PROCEEDINGS


The Company knows of no material existing or pending legal proceedings against it, nor is the Company involved as a plaintiff in any material proceeding or pending litigation. There are no proceedings in which any of the Company’s directors, officers or affiliates, or any registered or beneficial shareholder, is an adverse party or has a material interest adverse to the Company.


ITEM 1A. RISK FACTORS


The Company is a smaller reporting company as defined by Rule 12b-2 of the Securities Exchange Act of 1934 and is not required to provide the information under this item.


ITEM 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS


None.

ITEM 3. DEFAULTS UPON SENIOR SECURITIES


None.


ITEM 4. MINE SAFETY STANDARDS


Not Applicable.


ITEM 5. OTHER INFORMATION


None.





17


ITEM 6. EXHIBITS


Exhibits required by Item 601 of Regulation S-B


Exhibit

Number

Description of Exhibit

Filing Reference

(2)

Plan of Purchase, Sale, Reorganization, Arrangement, Liquidation or Succession

2.1

Share Exchange Agreement between Endeavor Power Corporation, Endeavor Holdings, Inc. and Parallax Diagnostics, Inc. and the Parallax Shareholders dated October 1, 2012

Filed with the SEC on November 15, 2012 as part of the Company’s Current Report on Form 8-K.

2.2

Letter of Intent between Parallax Diagnostics, Inc. and Endeavor Power Corporation dated August 15, 2012

Filed with the SEC on November 15, 2012 as part of the Company’s Current Report on Form 8-K.

(3)

Articles of Incorporation and Bylaws

3.1

Articles of Incorporation

Filed with the SEC on March 5, 2007 as part of the Company’s Registration Statement on Form SB-2.

3.1(a)

Amended and Restated Articles of Incorporation

Filed with the SEC on May 17, 2010 as part of the Company’s Annual Report on Form 10-K.

3.2

Bylaws

Filed with the SEC on March 5, 2007 as part of the Company’s Registration Statement on Form SB-2.

3.2(a)

Amended Bylaws

Filed with the SEC on May 17, 2010 as part of the Company’s Annual Report on Form 10-K.

3.3

Articles of Merger between Endeavor Power Corporation and Parallax Diagnostics, Inc. filed with Secretary of State of Nevada on November 6, 2012

Filed with the SEC on November 15, 2012 as part of the Company’s Current Report on Form 8-K.

3.4

Certificate of Amendment filed with the Secretary of State of Nevada on January 9, 2014

Filed with the SEC on April 14, 2014 as part of the Company’s Annual Report on Form 10-K.

(4)

Instruments Defining the Rights of Security Holders

4.1

2011 Equity Incentive Plan dated March 26, 2011

Filed with the SEC on March 31, 2011 as part of the Company’s Current Report on Form 8-K.

4.2

Sample Stock Option Agreement

Filed with the SEC on March 31, 2011 as part of the Company’s Current Report on Form 8-K.

4.3

Sample Stock Award Agreement for Stock Units

Filed with the SEC on March 31, 2011 as part of the Company’s Current Report on Form 8-K.

4.4

Sample Stock Award Agreement for Restricted Stock

Filed with the SEC on March 31, 2011 as part of the Company’s Current Report on Form 8-K.

4.5

2010 Employee Stock Option Plan of Parallax Diagnostics, Inc, dated October 1, 2010

Filed with the SEC on November 15, 2012 as part of the Company’s Current Report on Form 8-K.

4.6

Sample Stock Option Agreement

Filed with the SEC on November 15, 2012 as part of the Company’s Current Report on Form 8-K.

(10)

Material Contracts

10.1

Second Amendment to Joint Venture Agreement between the Company and Federated Energy Corporation dated September 15, 2009

Filed with the SEC on September 19, 2009 as part of the Company’s Current Report on Form 8-K.

10.2

Farmount Agreement between the Company and Togs Energy, Inc. and M-C Production & Drilling Co, Inc. dated July 21, 2009

Filed with the SEC on July 23, 2009 as part of the Company’s Current Report on Form 8-K.

10.3

Convertible Promissory Note to Regal Capital Development, Inc. dated August 25, 2009

Filed with the SEC on September 4, 2009 as part of the Company’s Current Report on Form 8-K.

10.4

Common Stock Purchase Warrant to Regal Capital Development, Inc. dated August 25, 2009

Filed with the SEC on September 4, 2009 as part of the Company’s Current Report on Form 8-K.

10.5

Settlement Agreement between the Company and Regal Capital Development, Inc. dated September 11, 2010

Filed with the SEC on July 12, 2010 as part of the Company’s Current Report on Form 8-K.

10.6

Promissory Note to Regal Capital Development, Inc. dated September 11, 2010

Filed with the SEC on July 12, 2010 as part of the Company’s Current Report on Form 8-K.

10.7

Amended Promissory Note to Regal Capital Development, Inc. dated September 11, 2010

Filed with the SEC on April 14, 2011 as part of the Company’s Annual Report on Form 10-K.

10.8

Settlement Agreement between the Company and Andrew I. Telsey, P.C., dated August 3, 2010

Filed with the SEC on August 22, 2011 as part of the Company’s Quarterly Report on Form 10-Q.

10.9

Settlement Agreement between the Company and Regal Capital Development, Inc. dated September 17, 2010

Filed with the SEC on October 21, 2010 as part of the Company’s Current Report on Form 8-K.

10.10

Promissory Note to Regal Capital Development, Inc. dated September 17, 2010

Filed with the SEC on October 21, 2010 as part of the Company’s Current Report on Form 8-K.

10.11

Employment Agreement between the Company and Alfonso Knoll dated November 8, 2010

Filed with the SEC on November 12, 2010 as part of the Company’s Current Report on Form 8-K.

10.12

Promissory Note to Regal Capital Development, Inc. dated November 23, 2010

Filed with the SEC on November 30, 2010 as part of the Company’s Current Report on Form 8-K.

10.13

Amendment to Employment Agreement between the Company and Alfonso Knoll dated November 17, 2010

Filed with the SEC on November 30, 2010 as part of the Company’s Current Report on Form 8-K.

10.14

Consulting Agreement between the Company and The Musser Group, LLC dated February 21, 2011

Filed with the SEC on February 25, 2011 as part of the Company’s Current Report on Form 8-K.

10.15

Promissory Note to Marans Invest & Finance S.A. dated April 8, 2011

Filed with the SEC on August 22, 2011 as part of the Company’s Quarterly Report on Form 10-Q.

10.16

Promissory Note to Rast Trade Corp. dated April 21, 2011

Filed with the SEC on August 22, 2011 as part of the Company’s Quarterly Report on Form 10-Q.

10.17

Settlement Agreement between the Company and Mr. Alfonso Knoll dated June 8, 2011

Filed with the SEC on June 16, 2011 as part of the Company’s Current Report on Form 8-K.

10.18

Settlement Agreement between the Company and The Musser Group, LLC dated July 19, 2011

Filed with the SEC on August 22, 2011 as part of the Company’s Quarterly Report on Form 10-Q.

10.19

Assignment of Intellectual Property between Roth Kline, Inc. and Montecito BioSciences, Ltd. dated September 10, 2010

Filed with the SEC on November 15, 2012 as part of the Company’s Current Report on Form 8-K.

10.20

License of Intellectual Property between Roth Kline Inc. and Montecito BioSciences, Ltd. dated September 10, 2010

Filed with the SEC on November 15, 2012 as part of the Company’s Current Report on Form 8-K.

10.21

Modification to the Assignment of Intellectual Property between Roth Kline, Inc. and Montecito BioSciences, Ltd.

Filed with the SEC on November 15, 2012 as part of the Company’s Current Report on Form 8-K.

10.22

Modification to the License of Intellectual Property between Roth Kline Inc. and Montecito BioSciences, Ltd. dated September 10, 2010

Filed with the SEC on November 15, 2012 as part of the Company’s Current Report on Form 8-K.

10.23

Employment Agreement between Roth Kline, Inc. and Michael Redmond dated November 15, 2010

Filed with the SEC on November 15, 2012 as part of the Company’s Current Report on Form 8-K.

10.24

Development and Supply Agreement between Parallax Diagnostics, Inc. and Corder Engineering, LLC dated July 1, 2011

Filed with the SEC on November 15, 2012 as part of the Company’s Current Report on Form 8-K.

10.25

Supply Agreement between Parallax Diagnostics, Inc. and Meyer Stevens Group, Inc. dated July 1, 2011

Filed with the SEC on November 15, 2012 as part of the Company’s Current Report on Form 8-K.

10.26

Consulting Agreement between Parallax Diagnostics, Inc. and Huntington Chase Financial Group, LLC dated January 2, 2012

Filed with the SEC on November 15, 2012 as part of the Company’s Current Report on Form 8-K.

10.27

Consulting Agreement between Parallax Diagnostics, Inc. and Greg Suess dated July 11, 2012

Filed with the SEC on November 15, 2012 as part of the Company’s Current Report on Form 8-K.

10.28

Convertible Preferred Purchase Agreement between Parallax Diagnostics, Inc. and Hamburg Investment Company, LLC, dated June 17, 2011

Filed with the SEC on November 15, 2012 as part of the Company’s Current Report on Form 8-K.

10.29

Convertible Preferred Purchase Agreement between Parallax Diagnostics, Inc. and Huntington Chase Financial Group, LLC, dated June 17, 2011

Filed with the SEC on November 15, 2012 as part of the Company’s Current Report on Form 8-K.

10.30

Convertible Preferred Purchase Agreement between Parallax Diagnostics, Inc. and Huntington Chase Financial Group, LLC, dated September 30, 2011

Filed with the SEC on November 15, 2012 as part of the Company’s Current Report on Form 8-K.

10.31

Consulting Agreement between Endeavor Power Corporation and Capital Group Communications, Inc. dated January 10, 2013

Filed with the SEC on May 15, 2013 as part of the Company’s Quarterly Report on Form 10-Q.

(14)

Code of Ethics

14.1

Code of Ethics

Filed with the SEC on April 14, 2011 as part of the Company’s Annual Report on Form 10-K.

(16)

Letter Re Change in Certifying Accountant

16.1

Letter from Moore and Associates, Chartered dated August 13, 2009

Filed with the SEC on August 13, 2009 as part of the Company’s Current Report on Form 8-K.

16.2

Letter from Seale & Beers, CPAs dated August 26, 2009

Filed with the SEC on August 27, 2009 as part of the Company’s Current Report on Form 8-K.

16.3

Letter from M&K CPAs, PLLC dated March 12, 2010

Filed with the SEC on March 12, 2010 as part of the Company’s Current Report on Form 8-K.

16.4

Letter from Ron Chadwick, P.C. dated August 3, 2010

Filed with the SEC on August 4, 2010 as part of the Company’s Current Report on Form 8-K.

16.5

Letter from Davis Accounting Group, P.C. dated November 29, 2010

Filed with the SEC on November 30, 2010 as part of the Company’s Current Report on Form 8-K.

16.6

Letter from M&K CPAs, PLLC dated October 23, 2012

Filed with the SEC on October 25, 2012 as part of the Company’s Current Report on Form 8-K.

(23)

Consent Letters

23.1

Letter from Seale & Beers, CPAs dated April 14, 2014

Filed with the SEC on April 14, 2014 as part of the Company’s Annual Report on Form 10-K.

(31)

Section 302 Certifications

31.1*

Section 302 Certification of J. Michael Redmond

Filed herewith.

31.2*

Section 302 Certification of Calli Bucci

Filed herewith.

(32)

Section 906 Certifications

32.1*

Section 906 Certification of J. Michael Redmond

Filed herewith.

32.2*

Section 906 Certification of Calli Bucci

Filed herewith.

(99)

Other Documents

99.1

Confidential Private Placement Memorandum for Parallax Diagnostics dated July 1, 2012

Filed with the SEC on November 15, 2012 as part of the Company’s Current Report on Form 8-K.

99.2

Patent Report issued by Marathon Patent Group on April 1, 2013

Filed with the SEC on April 16, 2013 as part of the Company’s Annual Report on Form 10-K.

(100)

XBRL Related Documents

101.INS**

XBRL Instance Document

Filed herewith.

101.SCH**

XBRL Taxonomy Extension Schema Document

Filed herewith.

101.CAL**

XBRL Taxonomy Extension Calculation Linkbase Document

Filed herewith.

101.LAB**

XBRL Taxonomy Extension Labels Linkbase Document

Filed herewith.

101.PRE**

XBRL Taxonomy Extension Presentation Linkbase Document

Filed herewith.

101.DEF**

XBRL Taxonomy Extension Definition Linkbase Document

Filed herewith.


*

Filed herewith.

**

Pursuant to Rule 406T of Regulation S-T, these interactive data files are deemed not filed or part of a registration statement or prospectus for purposes of Sections 11 or 12 of the Securities Act of 1933, as amended, is deemed not filed for purposes of Section 18 of the Securities Exchange Act of 1934, as amended, and otherwise is not subject to liability under these sections.



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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.

  

PARALLAX HEALTH SCIENCES, INC.

  

 

  

 

 Dated: November 19, 2014

/s/ J. Michael Redmond

 

J. Michael Redmond

  

President, Chief Executive Officer and Director

  

  

  

  

  

 

 Dated: November 19, 2014

/s/ Calli Bucci

 

Calli Bucci

  

Chief Financial Officer




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