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, 2015

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

For the transition period from _______________ to _______________.

Commission file number: 000-51225

Wisdom Homes of America, Inc.

(Exact name of registrant as specified in its charter)

Registrant's telephone number, including area code: (800) 727-1024

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. Yes x No ¨

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

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

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

Applicable only to issuers involved in bankruptcy proceedings during the preceding five years:

Indicate by check mark whether the registrant has filed all documents and reports required to be filed by Sections 12, 13 or 15(d) of the Securities Exchange Act of 1934 subsequent to the distribution of securities under a plan confirmed by a court. 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. As of November 14, 2015, there were 146,594,770 shares of common stock, par value $0.001, issued and outstanding.

WISDOM HOMES OF AMERICA, INC.

TABLE OF CONTENTS

 
PART I – FINANCIAL INFORMATION

This Quarterly Report includes forward looking statements within the meaning of the Securities Exchange Act of 1934 (the "Exchange Act"). These statements are based on management's beliefs and assumptions, and on information currently available to management. Forward looking statements include the information concerning our possible or assumed future results of operations set forth under the heading "Management's Discussion and Analysis of Financial Condition and Results of Operations." Forward looking statements also include statements in which words such as "expect," "anticipate," "intend," "plan," "believe," "estimate," "consider" or similar expressions are used.

Forward looking statements are not guarantees of future performance. They involve risks, uncertainties and assumptions. Our future results and shareholder values may differ materially from those expressed in these forward looking statements. Readers are cautioned not to put undue reliance on any forward looking statements.

ITEM 1 FINANCIAL STATEMENTS

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

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

Note 1. General

Nature of Business

The Company, together with its wholly owned subsidiaries, is engaged in opening and operating manufactured home retail centers, currently in Texas. Its manufactured home operations are primarily conducted through its wholly owned subsidiary, Wisdom Manufactured Homes Of America, Inc., however, the Company does maintain other wholly-owned subsidiaries which have little or no activity, each of which is incorporated or qualified to do business in the states in which it does so.

Wisdom Homes Of America, Inc. was formed on July 14, 2003 in the State of Nevada as Tora Technologies, Inc. On November 21, 2006, it changed its name to Makeup.com Limited, on January 29, 2010, it changed its name to LC Luxuries Limited, on November 5, 2010, it changed its name to General Cannabis, Inc., and on January 6, 2012, it changed its name to SearchCore, Inc. On March 3, 2015, the Company changed its name to Wisdom Homes Of America, Inc.

Corporate Name Change

On March 3, 2015, the Company changed its name from SearchCore, Inc. to Wisdom Homes of America, Inc. and increased the authorized common stock from 200 million shares to 300 million shares. The name change and increase in authorized common stock were unanimously approved by the Board of Directors on December 22, 2014, and by a majority of its outstanding shares of common stock at the annual shareholder meeting held on March 3, 2015.

Chief Financial Officer Appointment

On September 24, 2015, Munjit Johal resigned as one of the members of our Board of Directors, and as our Chief Financial Officer. Mr. Johal's resignation did not involve any disagreement with the Company or other management relating to the Company's operations, policies, practices or otherwise. James Pakulis will take over as interim Chief Financial Officer until a replacement can be identified.

Principal Services

The Company's principal service is opening and operating manufactured home retail centers, also known as model home retail centers. Its primary customers are homebuyers who generally purchase manufactured homes to place on their own homesites, although periodically customers will request assistance in locating a homesite in the areas where the Company has its retail centers. The Company generally operates its retail sales centers by having inventory on the retail center lots, although customers can order homes that are shipped directly from the factory to their homesite. Most of the Company's sales are to customers living within a radius of approximately one hundred miles from its retail centers.

WISDOM HOMES OF AMERICA, INC.

Notes to the Consolidated Financial Statements

September 30, 2015

Unaudited

In addition to Wisdom Manufactured Homes Of America, Inc., the Company has the following wholly-owned subsidiaries which have little operations:

The Company has the following wholly-owned subsidiaries which have no operations:

Currently, the Company has no imminent or specific plans for any of these entities and they are held as corporations in good standing.

Manufactured Home Retail Centers

The Company owns and operates manufactured home retail centers. In February 2014, the Company opened its first retail center in Rhome, Texas. Its second retail center in Tyler, Texas, was opened in April 2014, its third retail center in Jacksboro, Texas, in May 2014 and its fourth retail center in Mt. Pleasant, Texas, in December 2014. The retail centers are operated by the Company's wholly owned subsidiary, Wisdom Manufactured Homes Of America, Inc.

Note 2. Basis Of Presentation And Significant Accounting Policies

Basis of Presentation

The accompanying unaudited condensed consolidated financial statements of the Company have been prepared in accordance with U.S. generally accepted accounting principles (GAAP).

Reclassifications

Certain prior year amounts in the accompanying consolidated financial statements have been reclassified to conform to the current year's presentation. These reclassifications had no effect on the consolidated results of operations or financial position for any years presented.

WISDOM HOMES OF AMERICA, INC.

Notes to the Consolidated Financial Statements

September 30, 2015

Unaudited

Principles of Consolidation

The accompanying consolidated financial statements include the accounts of the Company and its wholly-owned subsidiaries. All significant intercompany accounts and transactions have been eliminated in consolidation.

Use of Estimates

The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the amounts reported in the financial statements and accompanying notes. These estimates are based on knowledge of current events and anticipated future events and accordingly, actual results may differ from those estimates.

Risks Related to Cash

The Company maintains cash in bank and deposit accounts, which at times may exceed federally insured limits. The Company has not experienced any losses in such accounts. The Company believes it is not exposed to any significant credit risk on cash and cash equivalents.

Cash and Cash Equivalents

The Company considers only highly liquid investments such as money market funds and commercial paper with maturities of 90 days or less at the date of their acquisition as cash and cash equivalents.

Fair Value of Financial Instruments

The accounting standards regarding disclosures about fair value of financial instruments defines financial instruments and required fair value disclosure of those instruments. This accounting standard defines fair value, establishes a three-level valuation hierarchy for disclosures of fair value measurement and enhances disclosure requirements for fair value measures. Receivables, investments, payables, short and long term debt and warrant liabilities qualified as financial instruments. Management believes the carrying amounts of receivables, payables and debt are a reasonable estimate of fair value because of the short period of time between the origination of such instruments, their expected realization, and if applicable, their stated interest rate is equivalent to interest rates currently available. The three levels are defined as follows:

WISDOM HOMES OF AMERICA, INC.

Notes to the Consolidated Financial Statements

September 30, 2015

Unaudited

The Company analyzes all financial instruments with features of both liabilities and equity under the accounting standards regarding accounting for certain financial instruments with characteristics of both liabilities and equity, accounting for derivative instruments and hedging activities, accounting for derivative financial instruments indexed to, and potentially settled in, a company's own stock, and the accounting standard regarding determining whether an instrument (or embedded feature) is indexed to an entity's own stock. The accounting standard specifies that a contract that would otherwise meet the definition of a derivative but is both (a) indexed to the Company's own stock and (b) classified in stockholders' equity in the statement of financial position would not be considered a derivative financial instrument. This standard provides a two-step model to be applied in determining whether a financial instrument or an embedded feature is indexed to an issuer's own stock and thus able to qualify for this accounting standard scope exception. All warrants issued by the Company are denominated in U.S. dollars.

Advertising Cost

The Company expenses advertising costs when incurred. Advertising expense for the nine months ended September 30, 2015 and 2014 was approximately $58,000 and approximately $21,000, respectively.

Allowance for Doubtful Accounts

Allowance for doubtful accounts is defined as a company's estimate of the amount of probable credit losses in the Company's existing accounts receivable. The Company does not maintain an allowance for doubtful accounts based upon management's review of the Company's revenue structure whereby substantially all receivables are confirmed before they are booked as revenue. The Company reviews its allowance for doubtful accounts policy periodically. The Company does not have any off-balance-sheet exposure related to its customers.

Inventory

Inventory is stated at the lower of cost or market. Cost is determined under the first-in, first-out method. The cost of a manufactured home in inventory is removed from inventory and recorded as a component of cost of sales at the time revenue is recognized.

Property and Equipment

Property and equipment are recorded at cost and depreciated using the straight-line method over the useful lives of the assets, generally from six to seven years. Property and equipment at September 30, 2015, and December 31, 2014, are presented net of accumulated depreciation of approximately $19,000 and approximately $9,000, respectively.

Intangible Assets

In accordance with Goodwill and Other Intangible Assets, intangible assets that are determined not to have an indefinite useful life are subject to amortization. The Company amortizes intangible assets using the straight-line method over their estimated useful lives.

WISDOM HOMES OF AMERICA, INC.

Notes to the Consolidated Financial Statements

September 30, 2015

Unaudited

Impairment of Long-Lived and Intangible Assets

In accordance with Accounting for the Impairment or Disposal of Long-Lived Assets, the Company reviews long-lived assets for impairment whenever events or changes in circumstances indicate that the carrying amount of these assets may not be recoverable. The Company assesses the recoverability of the long-lived and intangible assets by comparing the carrying amount to the estimated future undiscounted cash flow associated with the related assets. No impairment of intangible assets was recognized during the nine months ended September 30, 2015, or year ended December 31, 2014.

Stock-Based Compensation

The Company accounts for stock-based compensation in accordance with the provisions of Share-Based Payment, which addresses the accounting for equity-based compensation and which requires that the cost of all equity-based compensation arrangements be reflected in the financial statements over the vesting period based on the estimated fair value of the awards. During the nine months ended September 30, 2015, and September 30, 2014, the Company had $818,440 and $695,000, respectively, in stock-based compensation expense related to issuances of shares of the Company's common stock to consultants.

Revenue Recognition

The Company recognizes revenue in accordance with ASC 605, "Revenue Recognition," by recognizing as revenue the fees it charges customers as referenced below because persuasive evidence of an arrangement exists, the fees it charges are substantially fixed or determinable during the period that it provides the goods or services, the Company and its customers understand the specific nature and terms of the agreed upon transactions, and collectability is reasonably assured and the goods or services have been rendered. 

The Company and its wholly owned subsidiaries recognize revenue as follows:

Manufactured Home Retail Centers – the Company generates revenues through its manufactured home retail centers operated by Wisdom Manufactured Homes Of America, Inc., which it started in January 2014. The Company anticipates opening and/or acquiring additional retail centers in 2015 and branding them under the name Wisdom Manufactured Homes Of America, Inc. The Company purchases factory built houses and sells them to end users, and also anticipates structuring the sale of used manufactured homes. The Company recognizes revenue from manufactured homes sold generally when (i) the customer has entered into a binding sales agreement with the Company, (ii) the manufactured home has been delivered and installed at the customer's homesite, (iii) the customer has accepted the home and title has transferred and (iv) collectability of either cash payment from the customer or prearranged financing by the customer are reasonably assured.

Income Taxes

The Company follows Accounting for Income Taxes which requires recognition of deferred income tax liabilities and assets for the expected future tax consequences of temporary differences between the income tax basis and financial reporting basis of assets and liabilities. Provision for income taxes consists of taxes currently due plus deferred taxes.

WISDOM HOMES OF AMERICA, INC.

Notes to the Consolidated Financial Statements

September 30, 2015

Unaudited

The charge for taxation is based on the results for the year as adjusted for items that are non-assessable or disallowed. It is calculated using tax rates that have been enacted or substantively enacted by the balance sheet date. Deferred tax is accounted for using the balance sheet liability method in respect to temporary differences arising from differences between the carrying amount of assets and liabilities in the financial statements and the corresponding tax basis used in the computation of assessable tax profit. In principle, deferred tax liabilities are recognized for all taxable temporary differences, and deferred tax assets are recognized to the extent it is probable that taxable profit will be available against which deductible temporary differences can be utilized.

Deferred tax is calculated at the tax rates that are expected to apply to the period when the asset is realized or the liability is settled. Deferred tax is charged or credited in the income statement, except when it relates to items credited or charged directly to equity, in which case the deferred tax is also recorded in equity.

Deferred tax assets and liabilities are offset when they relate to income taxes levied by the same taxation authority and the Company intends to settle its current tax assets and liabilities on a net basis.

Uncertain tax positions

The Company recognizes uncertain tax positions based on a benefit recognition model. Provided that the tax position is deemed more likely than not of being sustained, the Company recognizes the largest amount of tax benefit that is greater than 50% likely of being ultimately realized upon settlement. The tax position is derecognized when it is no longer more likely than not of being sustained. The Company classifies income tax-related interest and penalties as interest expense and SGA expense, respectively, on the Consolidated Statement of Operations.

Recent Accounting Pronouncements

In June, 2014, the FASB issued Accounting Standards Update No. 2014-12, Compensation - Stock Compensation (Topic 718): Accounting for Share-Based Payments When the Terms of an Award Provide That a Performance Target Could Be Achieved after the Requisite Service Period. The amendments in the ASU require that a performance target that affects vesting and that could be achieved after the requisite service period be treated as a performance condition. A reporting entity should apply existing guidance in Topic 718, Compensation - Stock Compensation, as it relates to awards with performance conditions that affect vesting to account for such awards. The performance target should not be reflected in estimating the grant-date fair value of the award. Compensation cost should be recognized in the period in which it becomes probable that the performance target will be achieved and should represent the compensation cost attributable to the period(s) for which the requisite service has already been rendered. If the performance target becomes probable of being achieved before the end of the requisite service period, the remaining unrecognized compensation cost should be recognized prospectively over the remaining requisite service period. The total amount of compensation cost recognized during and after the requisite service period should reflect the number of awards that are expected to vest and should be adjusted to reflect those awards that ultimately vest. The requisite service period ends when the employee can cease rendering service and still be eligible to vest in the award if the performance target is achieved. The amendments in this ASU are effective for annual periods and interim periods within those annual periods beginning after December 15, 2015. Earlier adoption is permitted. Entities may apply the amendments in this ASU either: (a) prospectively to all awards granted or modified after the effective date; or (b) retrospectively to all awards with performance targets that are outstanding as of the beginning of the earliest annual period presented in the financial statements and to all new or modified awards thereafter. If retrospective transition is adopted, the cumulative effect of applying this ASU as of the beginning of the earliest annual period presented in the financial statements should be recognized as an adjustment to the opening retained earnings balance at that date. In addition, if retrospective transition is adopted, an entity may use hindsight in measuring and recognizing the compensation cost. The Company is currently assessing the impact this standard will have on its consolidated financial statements and required disclosures.

WISDOM HOMES OF AMERICA, INC.

Notes to the Consolidated Financial Statements

September 30, 2015

Unaudited

In November, 2014, the FASB issued Accounting Standards Update (ASU) No. 2014-16, Derivatives and Hedging (Topic 815): Determining Whether the Host Contract in a Hybrid Financial Instrument Issued in the Form of a Share Is More Akin to Debt or to Equity. The amendments in this ASU do not change the current criteria in U.S. GAAP for determining when separation of certain embedded derivative features in a hybrid financial instrument is required. The amendments clarify how current U.S. GAAP should be interpreted in evaluating the economic characteristics and risks of a host contract in a hybrid financial instrument that is issued in the form of a share. Specifically, the amendments clarify that an entity should consider all relevant terms and features, including the embedded derivative feature being evaluated for bifurcation, in evaluating the nature of the host contract. Furthermore, the amendments clarify that no single term or feature would necessarily determine the economic characteristics and risks of the host contract. Rather, the nature of the host contract depends upon the economic characteristics and risks of the entire hybrid financial instrument. The amendments in this ASU also clarify that, in evaluating the nature of a host contract, an entity should assess the substance of the relevant terms and features (i.e., the relative strength of the debt-like or equity-like terms and features given the facts and circumstances) when considering how to weigh those terms and features. Specifically, the assessment of the substance of the relevant terms and features should incorporate a consideration of: (1) the characteristics of the terms and features themselves (for example, contingent versus non-contingent, in-the-money versus out-of-the-money); (2) the circumstances under which the hybrid financial instrument was issued or acquired (e.g., issuer-specific characteristics, such as whether the issuer is thinly capitalized or profitable and well-capitalized); and (3) the potential outcomes of the hybrid financial instrument (e.g., the instrument may be settled by the issuer issuing a fixed number of shares, the instrument may be settled by the issuer transferring a specified amount of cash, or the instrument may remain legal-form equity), as well as the likelihood of those potential outcomes. The amendments in this ASU apply to all entities that are issuers of, or investors in, hybrid financial instruments that are issued in the form of a share. The amendments in this ASU are effective for public business entities for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2015. For all other entities, the amendments in this ASU are effective for fiscal years beginning after December 15, 2015, and interim periods within fiscal years beginning after December 15, 2016. Early adoption, including adoption in an interim period, is permitted. If an entity early adopts the amendments in an interim period, any adjustments should be reflected as of the beginning of the fiscal year that includes that interim period. The effects of initially adopting the amendments in this ASU should be applied on a modified retrospective basis to existing hybrid financial instruments issued in the form of a share as of the beginning of the fiscal year for which the amendments are effective. Retrospective application is permitted to all relevant prior periods. The Company is currently assessing the impact this standard will have on its consolidated financial statements and required disclosures.

In April, 2015, the FASB issued Accounting Standards Update (ASU) No. 2015-03, Interest - Imputation of Interest (Subtopic 835-30): Simplifying the Presentation of Debt Issuance Costs. The amendments in this ASU require that debt issuance costs related to a recognized debt liability be presented in the balance sheet as a direct deduction from the carrying amount of that debt liability, consistent with debt discounts. The recognition and measurement guidance for debt issuance costs are not affected by the amendments in this ASU. For public business entities, the amendments are effective for financial statements issued for fiscal years beginning after December 15, 2015, and interim periods within those fiscal years. For all other entities, the amendments are effective for financial statements issued for fiscal years beginning after December 15, 2015, and interim periods within fiscal years beginning after December 15, 2016. Early adoption of the amendments is permitted for financial statements that have not been previously issued. The amendments should be applied on a retrospective basis, wherein the balance sheet of each individual period presented should be adjusted to reflect the period-specific effects of applying the new guidance. Upon transition, an entity is required to comply with the applicable disclosures for a change in an accounting principle. These disclosures include the nature of and reason for the change in accounting principle, the transition method, a description of the prior-period information that has been retrospectively adjusted, and the effect of the change on the financial statement line items (i.e., debt issuance cost asset and the debt liability). The Company is currently assessing the impact this standard will have on its consolidated financial statements and required disclosures.

WISDOM HOMES OF AMERICA, INC.

Notes to the Consolidated Financial Statements

September 30, 2015

Unaudited

In April 2014, the Financial Accounting Standards Board issued Accounting Standards Update (ASU) No. 2014-08 Reporting Discontinued Operations and Disclosures of Disposals of Components of an Entity. ASU No. 2014-08 changes the requirements for reporting discontinued operations in that a discontinued operation may include a component of an entity, a group of components of an entity, or a business or non-profit activity. In addition, a disposal of a component of an entity or a group of components of an entity is required to be reported in discontinued operations if the disposal represents a strategic shift that has or will have a major effect on an entity's operations and financial results when certain conditions are met. For public company entities, ASU No. 2014-08 is effective for all disposals (or classifications as held for sale) of components of an entity that occur within annual periods beginning on or after December 15, 2014, and interim periods within those years. Early adoption is permitted, but only for disposals (or classifications as held for sale) that have not been reported in financial statements previously issued or available for issuance. Adoption of this standard had no significant impact on the Company's consolidated financial statements.

In July 2012, the Financial Accounting Standard Board ("FASB") issued Accounting Standards Update ("ASU") No. 2012-02, "Intangibles – Goodwill and Other (topic 350): Testing Indefinite-Lived Intangible Assets for Impairment" ("ASU 2012-02"). ASU 2012-02 states that an entity has the option first to assess qualitative factors to determine whether the existence of events and circumstances indicates that it is more likely than not that the indefinite-lived intangibles asset is impaired. If, after assessing the totality of events and circumstances, an entity concludes that it is not more likely than not that the indefinite-lived intangible asset is impaired, then the entity is not required to take further action. However, if an entity concludes otherwise, then it is required to determine the fair value of the indefinite-lived intangible asset and perform the quantitative impairment test by comparing the fair value with the carrying amount in accordance with Codification subtopic 350-30, Intangibles – Goodwill and Other, General Intangibles Other than Goodwill. The amendments in this ASU are effective for annual and interim impairment tests performed for fiscal years beginning after September 15, 2012. Early adoption is permitted, including for annual and interim impairment tests performed as of a date before July 27, 2012, if a public entity's financial statements for the most recent annual or interim period have not yet been issued. The Company elected early adoption of this update and it had no impact on its financial statements.

In July 2013, the FASB issued ASU No. 2013-11, "Presentation of an Unrecognized Tax Benefit When a Net Operating Loss Carryforward, a Similar Tax Loss, or a Tax Credit Carryforward Exists." ASU 2013-11 provides explicit guidance on the financial statement presentation of an unrecognized tax benefit when a net operating loss carryforward, a similar tax loss, or a tax credit carryforward exists. The guidance is effective prospectively for fiscal years, and interim periods within those years, beginning after December 15, 2013, with an option for early adoption. The Company adopted this guidance at the beginning of its first quarter of fiscal year 2014, and adoption of this standard had no significant impact on its consolidated financial statements and disclosures.

In May 2014, the FASB issued ASU No. 2014-09, Revenue from Contracts with Customers (Topic 606) ("ASU 2014-09"). ASU 2014-09 amends the guidance for revenue recognition to replace numerous, industry specific requirements and converges areas under this topic with those of the International Financial Reporting Standards. The ASU implements a five-step process for customer contract revenue recognition that focuses on transfer of control, as opposed to transfer of risk and rewards. The amendment also requires enhanced disclosures regarding the nature, amount, timing and uncertainty of revenues and cash flows from contracts with customers. Other major provisions include the capitalization and amortization of certain contract costs, ensuring the time value of money is considered in the transaction price, and allowing estimates of variable consideration to be recognized before contingencies are resolved in certain circumstances. The amendments in this ASU are effective for reporting periods beginning after December 15, 2016, and early adoption is prohibited. Entities can transition to the standard either retrospectively or as a cumulative-effect adjustment as of the date of adoption. The Company is currently assessing the impact the adoption of ASU 2014-09 will have on its consolidated financial statements and disclosures.

WISDOM HOMES OF AMERICA, INC.

Notes to the Consolidated Financial Statements

September 30, 2015

Unaudited

In December 2011, the Financial Accounting Standards Board, or FASB, issued an accounting standards update to require disclosure of information about the effect of rights of offset with certain financial instruments on an entity's financial position. In January 2013, the FASB issued an accounting standards update that clarifies the aforementioned offsetting disclosure requirements. The disclosure requirements are only applicable to rights of offset of certain derivative instruments, repurchase agreements and reverse purchase agreements, and securities borrowing and securities lending transactions that are either offset in accordance with standards set forth by the FASB Codification subject to master netting arrangements or similar agreements. Adoption of this standard had no significant impact on the Company's consolidated financial statements.

In February 2013, the FASB issued an accounting standards update that requires presentation for reclassification adjustments from accumulated other comprehensive income into net income in a single note or on the face of the financial statements. The Company has adopted the amendments in this standard effective in the first quarter of 2013. The adoption of this standard had an immaterial effect on the Company's consolidated financial statements and as such, the required presentation is not included herein.

In July 2013, the FASB issued an accounting standards update that specifies that unrecognized tax benefits should be presented in the financial statements as a reduction to a deferred tax asset for a net operating loss carryforward, a similar tax loss or a tax credit carryforward. When a net operating loss carryforward, a similar tax loss or tax credit carryforward is not available at the reporting date under the tax law of the applicable jurisdiction to settle any additional income taxes or the entity does not intend to use the deferred tax asset for such purpose, the unrecognized tax benefit should be presented in the financial statements as a liability and should not be combined with deferred tax assets. This amendment is effective for fiscal years, and interim periods within those years, beginning after December 15, 2013. The adoption of this accounting standards update did not have a significant impact on the Company's consolidated financial statements.

FASB issued an accounting standards update amending ASC 220 to improve the comparability, consistency and transparency of reporting of comprehensive income. It amends existing guidance by allowing only two options for presenting the components of net income and other comprehensive income: (1) in a single continuous financial statement, statement of comprehensive income or (2) in two separate but consecutive financial statements, consisting of an income statement followed by a separate statement of other comprehensive income. Also, items that are reclassified from other comprehensive income to net income must be presented on the face of the financial statements. ASU No. 2011-05 requires retrospective application, and it is effective for fiscal years, and interim periods within those years, beginning after December 15, 2011, with early adoption permitted. In December 2011, FASB issued ASU 2011-12. ASU 2011-12 indefinitely deferred the provisions of ASU 2011-05 requiring the presentation of reclassification adjustments on the face of the financial statements for items reclassified from other comprehensive income to net income. The adoption of this standard did not have a material impact on the Company's financial statements.

FASB issued an accounting standards update amending ASC 820, which is effective for interim and annual periods beginning after December 31, 2011, to achieve common fair value measurement and disclosure requirements between GAAP and IFRS. This amendment changes the wording used to describe fair value and requires additional disclosures. The adoption of this amendment did not have a material impact on the Company's financial statements.

In September 2011, the FASB issued an amendment to an existing accounting standard, which provides an option to perform a qualitative assessment to determine whether further impairment testing on goodwill is necessary. Specifically, an entity has the option to first assess qualitative factors to determine whether it is necessary to perform the current two-step test. If an entity believes, as a result of its qualitative assessment, that it is more-likely-than-not that the fair value of a reporting unit is less than its carrying amount, the quantitative impairment test is required. Otherwise, no further testing is required. This standard is effective for annual and interim goodwill impairment tests performed for fiscal years beginning after December 15, 2011. The adoption of this standard did not have a material impact on the Company's financial statements.

WISDOM HOMES OF AMERICA, INC.

Notes to the Consolidated Financial Statements

September 30, 2015

Unaudited

During May 2009 and February 2010, the FASB issued a new authoritative pronouncement regarding recognized and non-recognized subsequent events. This guidance establishes general standards of accounting for and disclosure of events that occur after the balance sheet date but before the financial statements are issued or are available to be issued. The adoption of this guidance had no impact on the Company's results of operations or financial position.

Other Recently Issued, but Not Yet Effective Accounting Pronouncements

Management does not believe that any other recently issued, but not yet effective accounting pronouncements, if adopted, would have a material effect on the accompanying consolidated financial statements.

Note 3. Equity Transactions

At September 30, 2015, the total number of shares of the Company's common stock that were issued was 82,185,304, which number of shares includes 5,000,000 shares that are issued but not outstanding and which are held in escrow. As such, at September 30, 2015, the total number of shares of the Company's common stock that were issued and outstanding was 77,185,304. At December 31, 2014, the total number of shares of the Company's common stock that were issued was 55,677,105 which number of shares included 5,000,000 shares that are issued but not outstanding and which were held in escrow. As such, at December 31, 2014, the total number of shares of the Company's common stock that were issued and outstanding was 50,677,105.

Common Stock

On July 18, 2014, the Company entered into a Securities Purchase Agreement with Typenex Co-Investment, LLC, pursuant to which it sold to Typenex a 10% Convertible Promissory Note in the original principal amount of $85,500 (the "Note"), which reflected an original issue discount of $7,500 and legal fees of $3,000. The Note had a maturity date of June 23, 2015, and was convertible after 180 days into common stock at $0.075 per share (the "Conversion Price"). The Conversion Price was subject to adjustment downward if the Company issued its common stock at a lower price prior to any conversion. On April 22, 2015, May 22, 2015, June 22, 2015, and August 20, 2015 the Company converted $14,583.75, $14,488.46, $14,373.22, and $10,296.64 of the Note into 378,799, 812,224, 1,271,032, and 2,958,804 shares of the Company's common stock, respectively.

On October 29, 2014, the Company entered into a Securities Purchase Agreement with LG Capital Funding, LLC ("LG Capital"), pursuant to which the Company sold to LG Capital an 8% Convertible Promissory Note in the original principal amount of $105,000 (the "Note"). The Note has a maturity date of October 29, 2015, and is convertible after 180 days into its common stock at a forty two percent (42%) discount from the lowest trading price of its common stock, as reported by any exchange upon which its common stock is then traded, for the ten (10) trading days prior to its receipt of notice from the Note holder to exercise this conversion feature. The Note can be prepaid by the Company at a premium as follows: (a) between 0 and 90 days after issuance – 120% of the principal amount; (b) between 91 and 150 days after issuance – 130% of the principal amount; (c) between 151 and 180 days after issuance – 140% of the principal amount. There is no right to prepay the Note after 180 days. On April 27, 2015, we repaid $75,000 of the promissory note to LG Capital. The remaining outstanding principal amount of the Note, in the amount of $53,000, plus accrued interest of $4,165.48, was sold by LG Capital to Carebourn Capital, L.P. On May 6, 2015 and June 9, 2015, the Company converted $16,500 and $30,300 of the Note into 500,000, and 1,500,000 shares of the Company's common stock, respectively.

WISDOM HOMES OF AMERICA, INC.

Notes to the Consolidated Financial Statements

September 30, 2015

Unaudited

On December 30, 2014, we entered into a Securities Purchase Agreement with KBM Worldwide, Inc., pursuant to which we sold to KBM a 8% Convertible Promissory Note in the original principal amount of$45,000 (the "Note"). The Note has a maturity date of October 2, 2015, and is convertible after 180 days into our common stock at the greater of (i) the Variable Conversion Price and (ii) the Fixed Conversion Price. The "Variable Conversion Price" shall mean 51% multiplied by the Market Price (representing a discount rate of49%). "Market Price" means the average of the lowest three (3) Trading Prices for the Common Stock during the ten (10) Trading Day period ending on the latest complete Trading Day prior to the Conversion Date. "Trading Price" means the closing bid price on the applicable day. The "Fixed Conversion Price" shall mean $0.00005. The shares of common stock issuable upon conversion of the Note will be restricted securities as defined in Rule 144 promulgated under the Securities Act of 1933. The Note can be prepaid by us at a premium as follows: (a) between 0 and 90 days after issuance – 130% of the principal amount and any accrued and unpaid interest; (b) between 91 and 150 days after issuance – 135% of the principal amount and any accrued and unpaid interest; and (c) between 151 and 180 days after issuance – 140% of the principal amount and any accrued and unpaid interest. The purchase and sale of the Note closed on December 31, 2014, the date that the purchase price was delivered to us. On July 7, 2015 and July 20, 2015 the Company converted $10,000 and $17,500 along with $1,800 in accrued but unpaid interest, of the Note into 653,595 and 1,892,157 shares of the Company's common stock, respectively.

On January 22, 2015, we entered into a Securities Purchase Agreement with Vista Capital Investments, LLC, pursuant to which we sold to Vista a 12% Convertible Promissory Note in the original principal amount of $55,000 (the "Note") with a $5,000 original issue discount. The Note has a maturity date of January 22, 2016, and is convertible after 120 days into our common stock at 90% of the Market Price of our common stock (representing a discount rate of 10%). "Market Price" means the lowest traded price for the Common Stock during the twenty (20) trading days before the conversion. The shares of common stock issuable upon conversion of the Note will be restricted securities as defined in Rule 144 promulgated under the Securities Act of 1933. The Note can be prepaid by us up to 180 days after issuance at 120% of the principal amount and any accrued and unpaid interest. On July 29, 2015 and August 11, 2015 the Company converted $7,425 and $10,675 of the Note into 750,000 and 3,500,000 shares of the Company's common stock, respectively.

On February 24, 2015, we entered into a Securities Purchase Agreement with LG Capital Funding, LLC ("LG Capital"), pursuant to which we sold to LG Capital an 8% Convertible Promissory Note in the original principal amount of $105,000 (the "Note"). The Note has a maturity date of February 24, 2016, and is convertible after 170 days into our common stock at a forty two percent (42%) discount from the lowest trading price of our common stock, as reported by any exchange upon which our common stock is then traded, for the ten (10) trading days prior to our receipt of notice from the Note holder to exercise this conversion feature. The conversion price shall be subject to a minimum conversion price of $0.0001 per share (the "floor price"), but in the event that the floor price is triggered, the conversion discount shall increase from forty two percent (42%) to fifty two (52%), calculated against the floor price. Interest accrued on the Note shall be payable in shares of our common stock, calculated using the same conversion formula. The Note can be prepaid by us at a premium as follows: (a) between 0 and 90 days after issuance – 120% of the principal amount; (b) between 91 and 150 days after issuance – 130% of the principal amount; (c) between 151 and 180 days after issuance – 140% of the principal amount. There is no right to prepay the Note after 180 days. The purchase and sale of the Note closed on February 27, 2015, the date that the purchase price was delivered to us. On August 28, 2015, the Company converted $3,000 of the Note along with $119.67 of accrued but unpaid interest into 1,629,921 shares of the Company's common stock.

WISDOM HOMES OF AMERICA, INC.

Notes to the Consolidated Financial Statements

September 30, 2015

Unaudited

Stock-based Compensation

On January 7, 2015, the Company approved the issuance of an aggregate of 1,050,000 shares of its common stock, effective as of December 31, 2014, restricted in accordance with Rule 144, to seven (7) individuals and entities for services valued at $73,500.

On January 7, 2015, the Company approved the issuance of an aggregate of 975,000 shares of its common stock, effective as of January 2, 2015, restricted in accordance with Rule 144, to five (5) individuals and entities for services valued at $68,250.

On February 6, 2015, the Company authorized the issuance of an aggregate of 650,000 shares of its common stock, effective as of December 31, 2014, restricted in accordance with Rule 144, to an entity for services valued at $45,500.

On April 15, 2015, we renewed a Consulting Agreement, which the Company had entered into on September 8, 2014, with a third party to provide consulting and advice related to potential partnerships, strategic contacts, joint ventures, corporate restructuring, and other business relationships, for a period of six months. Pursuant to the agreement, we agreed to issue to the consultant 2,436,667 shares of our common stock, restricted in accordance with Rule 144, valued at $200,000.

On April 23, 2015, in connection with the execution of a Consulting Agreement dated April 20, 2015, we agreed to issue 300,000 shares of our common stock, restricted in accordance with Rule 144, valued at $21,000, to one individual.

On May 15, 2015, we issued 5,100,000 shares of our common stock, restricted in accordance with Rule 144, valued at $392,190, to two individuals for services rendered, including 5,000,000 shares to Brent Nelms, the President of our subsidiary, Wisdom Manufactured Homes of America, Inc.

On or about July 6, 2015, we entered into a Consulting Agreement with Brighton Capital, Ltd. Pursuant to that agreement, we issued 150,000 shares of our common stock to Brighton in consideration for services rendered to us. In connection with the issuance, the Company record $18,000 in stock based compensation expense.

Note 4. Inventory

The inventory balance at September 30, 2015, was approximately $1,933,000, which consisted of 44 manufactured homes located at its retail lots which were stated at the lower of cost (average) or market, and 17 homesites. The inventory balance at September 30, 2014 was $1,363,665 which consisted of 25 manufactured homes located at our retail lots and 7 manufactured homes on order which were stated at the lower of cost (average) or market. The manufactured homes are located at the Company's Tyler, Texas, Mt. Pleasant, Texas, and Jacksboro, Texas, retail centers. The homesites are located at the Strawberry Addition in the City of Arp, Texas, and at the Hills of Oliver Creek Development in the City of Rhome, Texas.

WISDOM HOMES OF AMERICA, INC.

Notes to the Consolidated Financial Statements

September 30, 2015

Unaudited

Note 5. Note receivables

Current Note Receivables

At September 30, 2015, the Company had recorded a $83,518 note receivable which represented the current portion, including interest, of a $1,000,000 non-recourse promissory note pursuant to the sale of the Company's website, ManufacturedHomes.com, and related intellectual property.

At September 30, 2015, the Company had recorded $565 note receivable which represented the current portion, including interest, of a $29,250 promissory note pursuant to the sale of an unimproved homesite which accrues interest of 9% per annum and has a maturity date of November 15, 2039.

Noncurrent Note Receivables

At September 30, 2015, the Company had recorded a $850,000 note receivable which represented the noncurrent portion of a $1,000,000 non-recourse promissory note pursuant to the sale of the Company's website, ManufacturedHomes.com, and related intellectual property.

At September 30, 2015, the Company had recorded a $28,659 note receivable which represented the current portion, including interest, of a $29,250 promissory note pursuant to the sale of an unimproved homesite which accrues interest of 9% per annum and has a maturity date of November 15, 2039.

Note 6. Other Current Assets

At September 30, 2015, the Company had recorded approximately $13,100 in prepaid insurance, approximately $27,600 in deposits, approximately $6,000 in prepaid consulting fees, approximately $374,300 in loan proceeds, and approximately $10,600 in other.

Note 7. Property And Equipment

Property and equipment are recorded at cost and depreciated using the straight-line method over the useful lives of the assets, generally from six to seven years. Property and equipment at September 30, 2015, and December 31, 2014, consist of the following:

For the nine months ended September 30, 2015, depreciation expense was $9,994. For the year ended December 31, 2014, depreciation expense was $5,900.

WISDOM HOMES OF AMERICA, INC.

Notes to the Consolidated Financial Statements

September 30, 2015

Unaudited

Note 8. Intangible Assets

Intangible assets consist of a suite of domain names. The domain names have been determined to have an indefinite useful life based primarily on the renewability of the domain name. Intangible assets with an indefinite life are not subject to amortization, but will be subject to periodic evaluation for impairment.

Intangible asset amounts at September 30, 2015, and December 31, 2014, are as follows:

_________

* These domain names have been pledged as collateral in connection with a financing sale-leaseback with Domain Capital.

Note 9. Other Assets

At September 30, 2015, the balance of other assets included $3,100 in rent deposits and $75,000 in deposits.

WISDOM HOMES OF AMERICA, INC.

Notes to the Consolidated Financial Statements

September 30, 2015

Unaudited

Note 10. Discontinued Operations

General Management Solutions, Inc.

The Company discontinued the operations of General Management Solutions, Inc. ("GMS"), which previously oversaw and provided all of the human resource issues for employees including hiring, terminating, and employee benefits. GMS has been a corporation in good standing with no operations since the end of 2012. For comparative purposes, all prior periods presented have been restated to reflect the reclassification of this entity to discontinued operations on a consistent basis. The Company does not expect any continuing cash flows from GMS discontinued operations.

The liabilities of discontinued operations related to GMS at September 30, 2015, consists of $11,373 in accounts payable and $20,603 in accrued liabilities recorded as Current liabilities - discontinued operations.

General Health Solutions, Inc.

The Company discontinued the operations of General Health Solutions, Inc., which constituted its entire Medical Clinic Management segment. The Company discontinued the operations of General Health Solutions because of increasing costs associated with managing the clinics and the recent increased competition in the medicinal cannabis clinic industry. A major factor in the success of managing the medicinal cannabis clinics is running successful online Pay Per Click ("PPC") advertising campaigns. In PPC campaigns targeting is key, and factors that determine the pricing pertaining to certain key words depend heavily on the number of advertisers bidding on those certain key words. Taken together, i) the Company's increasing success with its technology in its Marketing and Media Segment and ii) the increasing costs of PPC campaigns coupled with the increasing number of sole-practitioner doctors now offering medicinal cannabis recommendation letters as part of their medical practice offerings, which places downward pressure on pricing, led the Company to decide to discontinue the operations of General Health Solutions, which composed its entire Medical Clinic Management Segment and focus its efforts instead on its technology in its Marketing and Media Segment.

During February 2012, the Company committed to a definitive plan to terminate the Management Agreement ("Agreement") and services associated with the Agreement, which resulted in General Health Solutions, Inc., the Company's Medical Clinic Management segment, being reported as discontinued operations. For comparative purposes, all prior periods presented have been restated to reflect the reclassification of this segment to discontinued operations on a consistent basis. Following the closure of the clinics during the first quarter 2012, the Company does not expect any continuing cash flows from discontinued operations.

The assets and liabilities of the Company's discontinued operations related to General Health Solutions at September 30, 2015, consists of $196,966 in notes payable recorded as Current liabilities - discontinued operations.

WISDOM HOMES OF AMERICA, INC.

Notes to the Consolidated Financial Statements

September 30, 2015

Unaudited

VerticalCore Merchant, Inc. - Tattoo.com

On January 21, 2013, the Company entered into a Management Agreement with Tattoo Interactive, LLC, pursuant to which it agreed to perform various marketing, promotion, and website management services with respect to the domain name known as Tattoo.com and the commercial website located at that domain. The Agreement had an initial term of twelve (12) months and automatically renewed for successive one (1) year terms unless terminated in accordance with its terms. On February 5, 2014, the Company received a fully signed copy of a First Amendment to Management Agreement (the "First Amended Agreement") dated as of January 27, 2014, pursuant to which Tattoo Interactive no longer had an obligation to reimburse the Company for any expenses or costs related to the Management Services as of January 1, 2014. The First Amended Agreement would automatically terminate on April 30, 2014 (the "Initial Term") unless a separate written agreement was executed by the parties (if so extended, the "Extended Initial Term"). On April 30, 2014, the First Amended Agreement automatically terminated pursuant to term of the First Amendment to Management Agreement dated as of January 27, 2014, and the Company did not pursue a further amendment or extension.

The company discontinued the operations of VerticalCore Merchant, Inc. ("VCM"), which previously performed the operations related to Tattoo.com, as a result of the automatic termination of the First Amendment to Management Agreement dated as of January 27, 2014.

For comparative purposes, all prior periods presented have been restated to reflect the reclassification of this entity to discontinued operations on a consistent basis. The Company does not expect any continuing cash flows from VCM's discontinued operations.

The liabilities of the Company's discontinued operations related to VCM at September 30, 2015, consists of $16,500 in accrued liabilities recorded as Current liabilities - discontinued operations.

Note 11. Accrued Liabilities

Accrued liabilities at September 30, 2015, and December 31, 2014, are comprised of the following:

At September 30, 2015, the Company had $1,098,000 in federal and state taxes payable which represent amounts due and payable for the years ended December 31, 2011 and 2012.

WISDOM HOMES OF AMERICA, INC.

Notes to the Consolidated Financial Statements

September 30, 2015

Unaudited

Note 12. Notes Payable

Adar Bays, LLC

On June 18, 2015, the Company entered into a Securities Purchase Agreement with Adar Bays, LLC, pursuant to which the Company sold to Adar Bays a 8% convertible note in the principal amount of $40,000 (the "Note"). The Note has a maturity date of June 18, 2016, and is convertible after 180 days into the Company's common stock at 58% of the lowest trading price of the Company's common stock for the ten (10) prior trading days (including the day upon which a notice of conversion is received), with a floor of $0.0001 per share. If the floor price is triggered, the discount at which Adar Bays may convert the Note increases to 48% of the lowest trading price. The shares of common stock issuable upon conversion of the Note will be restricted securities as defined in Rule 144 promulgated under the Securities Act of 1933. The Note can be prepaid by the Company at a premium as follows: (a) between 0 and 90 days after issuance – 120% of the principal amount; (b) between 91 and 150 days after issuance – 130% of the principal amount; and (c) between 151 and 180 days after issuance – 140% of the principal amount. There is no right to prepay the Note after 180 days. The purchase and sale of the Note closed on June 22, 2015, the date that the purchase price was delivered to the Company. The issuance of the Note was exempt from the registration requirements of the Securities Act of 1933 pursuant to Section 4(a)(2) thereof. The purchaser was an accredited and sophisticated investor, familiar with the Company's operations, and there was no solicitation.

American National Credit

On January 20, 2015, the Company entered into an agreement to purchase one (1) homesite for the purchase price of $27,500. The Company made a $1,500 down payment and issued a twenty six thousand dollar ($26,000) promissory note which carries 10% interest per annum and is payable over 360 equal monthly payments beginning on February 26, 2015. The homesite is located at the Hills of Oliver Creek Development, in the City of Rhome, Texas.

Auctus Private Equity Fund

On July 1, 2015, we repaid the promissory note to Auctus Private Equity Fund, LLC, that on December 15, 2014, we entered into in connection with a Securities Purchase Agreement, pursuant to which we sold Auctus an 8% Convertible Promissory Note in the principal amount of $55,000. We repaid the entire principal balance of the Note plus accrued interest and a prepayment premium, in the total amount of $83,175.97.

On July 9, 2015, we entered into a Securities Purchase Agreement with Auctus Fund, LLC ("Auctus"), pursuant to which we sold to Auctus a 10% Convertible Promissory Note in the original principal amount of Fifty Five Thousand Dollars ($55,000) (the "Note"). The Note has a maturity date of April 9, 2016, and is immediately convertible into our common stock at a forty two percent (42%) discount from the lowest trading price of our common stock, as reported by any exchange upon which our common stock is then traded, for the fifteen (15) trading days prior to our receipt of notice from the Note holder to exercise this conversion feature. The conversion price shall be subject to a minimum conversion price of $0.00005 per share. The Note can be prepaid by us at a premium as follows: (a) between 0 and 30 days after issuance – 115% of the principal amount; (b) between 31 and 60 days after issuance – 120% of the principal amount; (c) between 61 and 90 days after issuance – 125% of the principal amount; (d) between 91 and 120 days after issuance – 130% of the principal amount; (e) between 121 and 150 days after issuance – 135% of the principal amount; (f) between 151 days and 180 days after issuance – 140% of the principal amount. There is no right to prepay the Note after 180 days. The purchase and sale of the Note closed on July 10, 2015, the date that the purchase price was delivered to us.

WISDOM HOMES OF AMERICA, INC.

Notes to the Consolidated Financial Statements

September 30, 2015

Unaudited

Backman Notes

On March 28, 2014, the Company entered into, with a third party investor, a 20% convertible secured promissory note with a maturity date of April 28, 2015, and in the principal amount of $100,000 (the "Note"), which is convertible into common stock at $0.08 per share and which is collateralized by up to $15,000 on a monthly basis by the $100,000 in monthly payments which the Company receives pursuant to its sale of WeedMaps Media, Inc. if not paid in full within six months of the date of the Note. Furthermore, as further collateral, the Company placed 2,500,000 shares of its common stock into escrow.

On May 5, 2015, and effective as of April 28, 2015, the Company entered into a First Amendment to 20% Convertible Secured Promissory Note pursuant to which the parties extended the maturity date of the Note from April 28, 2015, to April 30, 2016. The transaction closed on May 15, 2015, the day the executed amendment was delivered to the Company. Then, on May 19, 2015, the Company entered into a Second Amendment to 20% Convertible Secured Promissory Note pursuant to which the parties reduced the maturity date of the Note from April 30, 2016, to October 31, 2015. This transaction closed on May 20, 2015, the day the executed amendment was delivered to the Company.

Carebourn Capital, L.P.

On April 27, 2015, the Company entered into a Securities Purchase Agreement with Carebourn Capital, L.P. ("Carebourn"), pursuant to which the Company sold to Carebourn a 10% Convertible Promissory Note in the original principal amount of $85,500 (the "Note"). The Note has a maturity date of January 27, 2016, and is convertible after 180 days into the Company's common stock at a forty two percent (42%) discount from the average of the three lowest trading prices of the Company's common stock, as reported by any exchange upon which the Company's common stock is then traded, for the ten (10) trading days prior to the Company's receipt of notice from the Note holder to exercise this conversion feature. The conversion price shall be subject to a minimum conversion price of $0.0001 per share (the "floor price"). The Note can be prepaid by the Company at a premium as follows: (a) between 0 and 30 days after issuance – 115% of the principal amount; (b) between 31 and 60 days after issuance – 120% of the principal amount; (c) between 61 and 90 days after issuance – 125% of the principal amount; (d) between 91 and 120 days after issuance – 130% of the principal amount; (e) between 121 and 150 days after issuance – 135% of the principal amount; and (f) between 151 and 180 days after issuance – 140% of the principal amount. There is no right to prepay the Note after 180 days. The purchase and sale of the Note closed on April 29, 2015, the date that the purchase price was delivered to the Company. The issuance of the Note was exempt from the registration requirements under the Securities Act of 1933 pursuant to Rule 506 of Regulation D thereof. The purchaser was an accredited and sophisticated investor, familiar with the Company's operations, and there was no solicitation.

On May 22, 2015, the Company entered into a Securities Purchase Agreement with Carebourn Capital, L.P. ("Carebourn"), pursuant to which the Company sold to Carebourn a 10% Convertible Promissory Note in the original principal amount of $25,000 (the "Note"). The Note has a maturity date of February 22, 2016, and is convertible after 180 days into the Company's common stock at a forty two percent (42%) discount from the average of the three (3) lowest trading prices of the Company's common stock, as reported by any exchange upon which the Company's common stock is then traded, for the ten (10) trading days prior to the Company's receipt of notice from the Note holder to exercise this conversion feature. The conversion price shall be subject to a minimum conversion price of $0.0001 per share (the "floor price"). The Note can be prepaid by the Company at a premium as follows: (a) between 0 and 30 days after issuance – 115% of the principal amount; (b) between 31 and 60 days after issuance – 120% of the principal amount; (c) between 61 and 90 days after issuance – 125% of the principal amount; (d) between 91 and 120 days after issuance – 130% of the principal amount; (e) between 121 and 150 days after issuance – 135% of the principal amount; and (f) between 151 and 180 days after issuance – 140% of the principal amount. There is no right to prepay the Note after 180 days. The purchase and sale of the Note closed on May 22, 2015, the date that the purchase price was delivered to the Company. The issuance of the Note was exempt from the registration requirements under the Securities Act of 1933 pursuant to Rule 506 of Regulation D thereof. The purchaser was an accredited and sophisticated investor, familiar with the Company's operations, and there was no solicitation.

WISDOM HOMES OF AMERICA, INC.

Notes to the Consolidated Financial Statements

September 30, 2015

Unaudited

On June 26, 2015, the Company entered into a Securities Purchase Agreement with Carebourn Capital, L.P. ("Carebourn"), pursuant to which the Company sold to Carebourn a 10% Convertible Promissory Note in the original principal amount of $30,500 (the "Note"). The Note has a maturity date of June 26, 2016, and is convertible after 180 days into the Company's common stock at a forty two percent (42%) discount from the average of the three (3) lowest trading prices of the Company's common stock, as reported by any exchange upon which the Company's common stock is then traded, for the ten (10) trading days prior to the Company's receipt of notice from the Note holder to exercise this conversion feature. The conversion price shall be subject to a minimum conversion price of $0.0001 per share (the "floor price"). The Note can be prepaid by the Company at a premium as follows: (a) between 0 and 30 days after issuance – 115% of the principal amount; (b) between 31 and 60 days after issuance – 120% of the principal amount; (c) between 61 and 90 days after issuance – 125% of the principal amount; (d) between 91 and 120 days after issuance – 130% of the principal amount; (e) between 121 and 150 days after issuance – 135% of the principal amount; and (f) between 151 and 180 days after issuance – 140% of the principal amount. There is no right to prepay the Note after 180 days. The purchase and sale of the Note closed on June 26, 2015, the date that the purchase price was delivered to the Company. The issuance of the Note was exempt from the registration requirements under the Securities Act of 1933 pursuant to Rule 506 of Regulation D thereof. The purchaser was an accredited and sophisticated investor, familiar with the Company's operations, and there was no solicitation.

DeLue Notes

On March 26, 2014, the Company entered into, with a third party investor, a 20% convertible secured promissory note with a maturity date of April 26, 2015, and in the principal amount of $100,000 (the "Convertible Note"), which is convertible into the Company's common stock at $0.08 per share and which is collateralized by up to $15,000 on a monthly basis by the $100,000 in monthly payments which the Company receives pursuant to its sale of WeedMaps Media, Inc., if not paid in full within six months of the date of the Note. Furthermore, as further collateral, the Company placed 2,500,000 shares of its common stock into escrow. Finally, as an incentive to the third party investor to enter into the Note, the Company issued 300,000 shares of its common stock. The Company accounts for debt discount according to ASC 470-20 Debt With Conversion And Other Options. No debt discount associated with the Convertible Note was recorded because the fair value of the common stock at the commitment date ($0.05) was less than the effective conversion price of the conversion feature ($0.07). As such, there was no intrinsic value associated with the conversion feature and thus no debt discount was recognized.

On May 5, 2015, and effective as of April 26, 2015, the Company entered into a First Amendment to 20% Convertible Secured Promissory Note pursuant to which the parties extended the maturity date of the Note from April 26, 2015, to October 31, 2015. The transaction closed on May 15, 2015, the day the executed amendment was delivered to the Company.

GW Holdings Group, LLC

On June 17, 2015, the Company entered into a Securities Purchase Agreement with GW Holdings Group, LLC, pursuant to which the Company sold to GW Group a 8% convertible note in the principal amount of $30,000 (the "Note"). The Note has a maturity date of June 17, 2016, and is convertible after 180 days into the Company's common stock at 58% of the lowest trading price of the Company's common stock for the ten (10) prior trading days (including the day upon which a notice of conversion is received), with a floor of $0.0001 per share. The shares of common stock issuable upon conversion of the Note will be restricted securities as defined in Rule 144 promulgated under the Securities Act of 1933. The Note can be prepaid by the Company at a premium as follows: (a) between 0 and 90 days after issuance – 125% of the principal amount; (b) between 91 and 150 days after issuance – 135% of the principal amount; and (c) between 151 and 180 days after issuance – 145% of the principal amount. There is no right to prepay the Note after 180 days. The purchase and sale of the Note closed on June 19, 2015, the date that the purchase price was delivered to the Company. The issuance of the Note was exempt from the registration requirements of the Securities Act of 1933 pursuant to Section 4(a)(2) thereof. The purchaser was an accredited and sophisticated investor, familiar with the Company's operations, and there was no solicitation.

WISDOM HOMES OF AMERICA, INC.

Notes to the Consolidated Financial Statements

September 30, 2015

Unaudited

JARVCO Note

On January 29, 2015, the Company entered into an agreement to purchase eleven (11) homesites in exchange for issuing a promissory note in the principal amount of Seventy Six Thousand Dollars ($76,000), which accrues interest at seven percent (7%) per annum and is payable over 360 equal monthly payments beginning on March 1, 2015. The homesites are located at the Strawberry Addition in the City of Arp, Texas.

JMJ Financial

On July 20, 2015, we issued a $200,000 Convertible Note (the "Note") to JMJ Financial. The Note contains a ten percent (10%) original issue discount, and is to be funded in tranches at the sole discretion of JMJ. The first tranche was for $20,000. The Note has a maturity date of two years from the funding of each tranche and is convertible at the lesser of $0.02 or 60% of the lowest trade price in the 25 trading days before conversion. Each tranche is subject to a onetime interest charge of 12% 90 days after its funding. The Note can be prepaid by us only during the first 90 days following the issuance of each funding tranche. The purchase and sale of the Note closed on July 23, 2015, the date that the purchase price was delivered to us.

KBM Enterprises, LLC

On January 9, 2015, the Company repaid the promissory note to KBM Worldwide, Inc., that on July 9, 2014, the Company entered into in connection with a Securities Purchase Agreement, pursuant to which the Company sold KBM Worldwide an 8% Convertible Promissory Note in the principal amount of Fifty Three Thousand Dollars ($53,000) (the "Note"). The Company repaid the entire principal balance of the Note plus accrued interest and a prepayment premium, in the total amount of Seventy One Thousand and Fifteen Dollars ($71,015.00).

On February 26, 2015, the Company repaid the promissory note to KBM Worldwide, Inc., that on August 26, 2014, the Company entered into in connection with a Securities Purchase Agreement, pursuant to which the Company sold KBM Worldwide an 8% Convertible Promissory Note in the principal amount of Forty Seven Thousand Five Hundred Dollars ($47,500) (the "Note"). The Company repaid the entire principal balance of the Note plus accrued interest and a prepayment premium, in the total amount of Sixty Three Thousand Six Hundred Forty Four Dollars and Eighty Cents ($63,644.80).

On April 28, 2015, the Company repaid the promissory note to KBM Enterprises, LLC, that on October 20, 2014, the Company entered into in connection with a Securities Purchase Agreement, pursuant to which the Company sold KBM Enterprises an 8% Convertible Promissory Note in the principal amount of $83,000. The Company repaid the entire principal balance of the Note plus accrued interest and a prepayment premium, in the total amount of $111,192.71.

On May 12, 2015, the Company repaid the promissory note to KBM Enterprises, LLC, that on November 10, 2014, the Company entered into in connection with a Securities Purchase Agreement, pursuant to which the Company sold KBM Enterprises an 8% Convertible Promissory Note in the principal amount of $54,000. The Company repaid the entire principal balance of the Note plus accrued interest and a prepayment premium, in the total amount of $72,330.41.

On June 12, 2015, the Company repaid the promissory note to KBM Enterprises, LLC, that on December 9, 2014, the Company entered into in connection with a Securities Purchase Agreement, pursuant to which the Company sold KBM Enterprises an 8% Convertible Promissory Note in the principal amount of $63,500. The Company repaid the entire principal balance of the Note plus accrued interest and a prepayment premium, in the total amount of $85,096.96.

WISDOM HOMES OF AMERICA, INC.

Notes to the Consolidated Financial Statements

September 30, 2015

Unaudited

LG Capital Funding, LLC

On February 24, 2015, the Company entered into a Securities Purchase Agreement with LG Capital Funding, LLC ("LG Capital"), pursuant to which the Company sold to LG Capital an 8% Convertible Promissory Note in the original principal amount of $105,000 (the "Note"). The Note has a maturity date of February 24, 2016, and is convertible after 170 days into its common stock at a forty two percent (42%) discount from the lowest trading price of its common stock, as reported by any exchange upon which its common stock is then traded, for the ten (10) trading days prior to its receipt of notice from the Note holder to exercise this conversion feature. The conversion price shall be subject to a minimum conversion price of $0.0001 per share (the "floor price"), but in the event that the floor price is triggered, the conversion discount shall increase from forty two percent (42%) to fifty two (52%), calculated against the floor price. Interest accrued on the Note shall be payable in shares of its common stock, calculated using the same conversion formula. The Note can be prepaid by the Company at a premium as follows: (a) between 0 and 90 days after issuance – 120% of the principal amount; (b) between 91 and 150 days after issuance – 130% of the principal amount; (c) between 151 and 180 days after issuance – 140% of the principal amount. There is no right to prepay the Note after 180 days. The purchase and sale of the Note closed on February 27, 2015, the date that the purchase price was delivered to the Company.

On April 27, 2015, the Company repaid $75,000 of the promissory note to LG Capital Funding, LLC, that on October 29, 2014, the Company entered into in connection with a Securities Purchase Agreement, pursuant to which the Company sold to LG Capital Funding, LLC an 8% Convertible Promissory Note in the principal amount of $105,000 (the "Note"). The remaining outstanding principal amount of the Note, in the amount of $53,000, plus accrued interest of $4,165.48, was sold by LG Capital to Carebourn Capital, L.P.

On June 4, 2015, the Company entered into a Securities Purchase Agreement with LG Capital Funding, LLC ("LG Capital"), pursuant to which the Company sold to LG Capital an 8% Convertible Promissory Note in the original principal amount of $78,750 (the "Note"). The Note has a maturity date of June 4, 2016, and is convertible after 180 days into the Company's common stock at a forty two percent (42%) discount from the lowest trading price of the Company's common stock, as reported by any exchange upon which the Company's common stock is then traded, for the ten (10) trading days prior to the Company's receipt of notice from the Note holder to exercise this conversion feature. The conversion price shall be subject to a minimum conversion price of $0.0001 per share (the "floor price"), but in the event that the floor price is triggered, the conversion discount shall increase from forty two percent (42%) to fifty two percent (52%), calculated against the floor price. Interest accrued on the Note shall be payable in shares of the Company's common stock, calculated using the same conversion formula. The Note can be prepaid by the Company at a premium as follows: (a) between 0 and 90 days after issuance – 120% of the principal amount; (b) between 91 and 150 days after issuance – 130% of the principal amount; (c) between 151 and 180 days after issuance – 140% of the principal amount. There is no right to prepay the Note after 180 days. The purchase and sale of the Note closed on June 5, 2015, the date that the purchase price was delivered to the Company. The issuance of the Note was exempt from the registration requirements of the Securities Act of 1933 pursuant to Section 4(a)(2) thereof. The purchaser was an accredited and sophisticated investor, familiar with the Company's operations, and there was no solicitation.

WISDOM HOMES OF AMERICA, INC.

Notes to the Consolidated Financial Statements

September 30, 2015

Unaudited

Oakmore Opportunity Fund I LP

On June 23, 2015, the Company entered into a Securities Purchase Agreement with Oakmore Opportunity Fund I LP ("Oakmore"), pursuant to which the Company sold to Oakmore a 8% Convertible Promissory Note in the original principal amount of $40,000 (the "Note"). The Note has a maturity date of June 23, 2016, and is convertible after 180 days into the Company's common stock at a forty two percent (42%) discount from the average of the three (3) lowest trading prices of the Company's common stock, as reported by any exchange upon which the Company's common stock is then traded, for the ten (10) trading days prior to the Company's receipt of notice from the Note holder to exercise this conversion feature. The conversion price shall be subject to a minimum conversion price of $0.00005 per share (the "floor price"), but in the event that the Company's common stock becomes "chilled" by the Deposit Trust Corporation, the conversion discount shall increase from forty two percent (42%) to fifty two percent (52%) for as long as the Company's common stock is chilled, calculated against the floor price. The Note can be prepaid by the Company at a premium as follows: (a) between 0 and 90 days after issuance – 130% of the principal amount; (b) between 91 and 120 days after issuance – 135% of the principal amount; (c) between 121 and 180 days after issuance – 140% of the principal amount. There is no right to prepay the Note after 180 days. The purchase and sale of the Note closed on June 30, 2015, the date that the purchase price was delivered to the Company. The issuance of the Note was exempt from the registration requirements under the Securities Act of 1933 pursuant to Rule 506 of Regulation D thereof. The purchaser was an accredited and sophisticated investor, familiar with the Company's operations, and there was no solicitation.

Rock Capital

On July 1, 2015, we entered into a Securities Purchase Agreement with Rock Capital, LLC ("Rock Capital"), pursuant to which we sold to Rock Capital an 8% Convertible Promissory Note in the original principal amount of Thirty Seven Thousand Five Hundred Dollars ($37,500) (the "Note"). The Note has a maturity date of April 1, 2016, and is convertible after 180 days into our common stock at a forty two percent (42%) discount from the lowest trading price of our common stock, as reported by any exchange upon which our common stock is then traded, for the ten (10) trading days prior to our receipt of notice from the Note holder to exercise this conversion feature. The conversion price shall be subject to a minimum conversion price of $0.00005 per share (the "floor price"). The Note can be prepaid by us at a premium as follows: (a) between 0 and 90 days after issuance – 125% of the principal amount; (b) between 91 and 150 days after issuance – 135% of the principal amount; and (c) between 151 and 180 days after issuance – 145% of the principal amount. There is no right to prepay the Note after 180 days. The purchase and sale of the Note closed on July 4, 2015, the date that the purchase price was delivered to us.

Service Trading Company, LLC

On June 4, 2015, the Company entered into a Securities Purchase Agreement with Service Trading Company, LLC, ("Service Trading"), pursuant to which the Company sold to Service Trading an 8% Convertible Promissory Note in the original principal amount of $31,500 (the "Note"). The Note has a maturity date of June 4, 2016, and is convertible after 180 days into the Company's common stock at a forty two percent (42%) discount from the lowest trading price of the Company's common stock, as reported by any exchange upon which the Company's common stock is then traded, for the ten (10) trading days prior to the Company's receipt of notice from the Note holder to exercise this conversion feature. The conversion price shall be subject to a minimum conversion price of $0.0001 per share (the "floor price"), but in the event that the floor price is triggered, the conversion discount shall increase from forty two percent (42%) to fifty two percent (52%), calculated against the floor price. Interest accrued on the Note shall be payable in shares of the Company's common stock, calculated using the same conversion formula. The Note can be prepaid by the Company at a premium as follows: (a) between 0 and 90 days after issuance – 120% of the principal amount; (b) between 91 and 150 days after issuance – 130% of the principal amount; (c) between 151 and 180 days after issuance – 140% of the principal amount. There is no right to prepay the Note after 180 days. The purchase and sale of the Note closed on June 9, 2015, the date that the purchase price was delivered to the Company. The issuance of the Note was exempt from the registration requirements of the Securities Act of 1933 pursuant to Section 4(a)(2) thereof. The purchaser was an accredited and sophisticated investor, familiar with the Company's operations, and there was no solicitation.

WISDOM HOMES OF AMERICA, INC.

Notes to the Consolidated Financial Statements

September 30, 2015

Unaudited

Vis Vires Group, Inc.

On April 6, 2015, the Company entered into a Securities Purchase Agreement with Vis Vires Group, Inc., pursuant to which the Company sold to Vires a 8% Convertible Promissory Note in the original principal amount of $90,000 (the "Note"). The Note has a maturity date of January 9, 2016, and is convertible after 180 days into the Company's common stock at the greater of (i) the Variable Conversion Price and (ii) the Fixed Conversion Price. The "Variable Conversion Price" shall mean 58% multiplied by the Market Price (representing a discount rate of 42%). "Market Price" means the average of the lowest three (3) Trading Prices for the Common Stock during the ten (10) Trading Day period ending on the latest complete Trading Day prior to the Conversion Date. "Trading Price" means the closing bid price on the applicable day. The "Fixed Conversion Price" shall mean $0.00005. The shares of common stock issuable upon conversion of the Note will be restricted securities as defined in Rule 144 promulgated under the Securities Act of 1933. The Note can be prepaid by the Company at a premium as follows: (a) between 0 and 90 days after issuance – 130% of the principal amount and any accrued and unpaid interest; (b) between 91 and 150 days after issuance – 135% of the principal amount and any accrued and unpaid interest; and (c) between 151 and 180 days after issuance – 140% of the principal amount and any accrued and unpaid interest. The purchase and sale of the Note closed on April 9, 2015, the date that the purchase price was delivered to the Company. The issuance of the Note was exempt from the registration requirements of the Securities Act of 1933 pursuant to Section 4(a)(2) thereof. The purchaser was an accredited and sophisticated investor, familiar with the Company's operations, and there was no solicitation.

On April 29, 2015, the Company entered into a Securities Purchase Agreement with Vis Vires Group, Inc., pursuant to which the Company sold to Vires a 8% Convertible Promissory Note in the original principal amount of $53,500 (the "Note"). The Note has a maturity date of February 1, 2016, and is convertible after 180 days into the Company's common stock at the greater of (i) the Variable Conversion Price and (ii) the Fixed Conversion Price. The "Variable Conversion Price" shall mean 58% multiplied by the Market Price (representing a discount rate of 42%). "Market Price" means the average of the lowest three (3) Trading Prices for the Common Stock during the ten (10) Trading Day period ending on the latest complete Trading Day prior to the Conversion Date. "Trading Price" means the closing bid price on the applicable day. The "Fixed Conversion Price" shall mean $0.00005. The shares of common stock issuable upon conversion of the Note will be restricted securities as defined in Rule 144 promulgated under the Securities Act of 1933. The Note can be prepaid by the Company at a premium as follows: (a) between 0 and 90 days after issuance – 130% of the principal amount and any accrued and unpaid interest; (b) between 91 and 120 days after issuance – 135% of the principal amount and any accrued and unpaid interest; and (c) between 121 and 180 days after issuance – 140% of the principal amount and any accrued and unpaid interest. The purchase and sale of the Note closed on May 5, 2015, the date that the purchase price was delivered to the Company. The issuance of the Note was exempt from the registration requirements of the Securities Act of 1933 pursuant to Section 4(a)(2) thereof. The purchaser was an accredited and sophisticated investor, familiar with the Company's operations, and there was no solicitation.

On June 8, 2015, the Company entered into a Securities Purchase Agreement with Vis Vires Group, Inc., pursuant to which the Company sold to Vires a 8% Convertible Promissory Note in the original principal amount of $43,500 (the "Note"). The Note has a maturity date of March 10, 2016, and is convertible after 180 days into the Company's common stock at the greater of (i) the Variable Conversion Price and (ii) the Fixed Conversion Price. The "Variable Conversion Price" shall mean 58% multiplied by the Market Price (representing a discount rate of 42%). "Market Price" means the average of the lowest three (3) Trading Prices for the Common Stock during the ten (10) Trading Day period ending on the latest complete Trading Day prior to the Conversion Date. "Trading Price" means the closing bid price on the applicable day. The "Fixed Conversion Price" shall mean $0.00005. The shares of common stock issuable upon conversion of the Note will be restricted securities as defined in Rule 144 promulgated under the Securities Act of 1933. The Note can be prepaid by the Company at a premium as follows: (a) between 0 and 90 days after issuance – 130% of the principal amount and any accrued and unpaid interest; (b) between 91 and 120 days after issuance – 135% of the principal amount and any accrued and unpaid interest; and (c) between 121 and 180 days after issuance – 140% of the principal amount and any accrued and unpaid interest. The purchase and sale of the Note closed on June 15, 2015, the date that the purchase price was delivered to the Company. The issuance of the Note was exempt from the registration requirements of the Securities Act of 1933 pursuant to Section 4(a)(2) thereof. The purchaser was an accredited and sophisticated investor, familiar with the Company's operations, and there was no solicitation.

WISDOM HOMES OF AMERICA, INC.

Notes to the Consolidated Financial Statements

September 30, 2015

Unaudited

Vista Capital Investments, LLC

On January 22, 2015, the Company entered into a Securities Purchase Agreement with Vista Capital Investments, LLC, pursuant to which the Company sold to Vista a 12% Convertible Promissory Note in the original principal amount of $55,000 (the "Note") with a $5,000 original issue discount. The Note has a maturity date of January 22, 2016, and is convertible after 120 days into its common stock at 90% of the Market Price of its common stock (representing a discount rate of 10%). "Market Price" means the lowest traded price for the Common Stock during the twenty (20) trading days before the conversion. The shares of common stock issuable upon conversion of the Note will be restricted securities as defined in Rule 144 promulgated under the Securities Act of 1933. The Note can be prepaid by the Company up to 180 days after issuance at 120% of the principal amount and any accrued and unpaid interest. In connection with the sale of the Note, the Company also issued to Vista warrants to acquire 1,736,111 shares of its common stock at an exercise price of $0.075 per share (subject to adjustment). The warrants are exercisable for a period of five (5) years and contain a cashless exercise provision at the option of the holder.

Below is a summary of note payable amounts which include accrued interest:

During the nine months ending September 30, 2015, the noncurrent portions of the Abrams, Backman, Buckles, Caesar Capital, DeLue, Elkins, Geist notes were reclassed to current notes payable.

Note 13. Notes Payable - Related Party

From April 2015 through September 2015, Mr. James Pakulis, who is a member of the Company's Board of Directors and serves as its Chief Executive Office, loaned the Company $56,865. The Company recorded the amount as a demand note, which carries imputed interest. At September 30, 2015, accrued but unpaid interest totaled $265.

Sportify Note

On December 31, 2012, the Company entered into a Securities Purchase Agreement by and among it, on the one hand, and Sportify, Inc., a Nevada corporation, and its shareholders, Sabas Carrillo ("Carrillo"), an individual, and James Pakulis ("Pakulis"), an individual and one of the Company's officers and directors, on the other hand. Pursuant to the agreement, upon the closing of the transaction, the Company purchased 100% of the issued and outstanding equity interests of Sportify in exchange for (a) the cancellation of a previous Secured Promissory Note issued to Sportify, entered into on or about August 22, 2012, and with an outstanding principal balance of Two Hundred Eighty Five Thousand Dollars ($285,000) and (b) Two Hundred Fifteen Thousand Dollars ($215,000) represented by promissory notes in the original principal amount of One Hundred Sixty One Thousand Two Hundred Fifty Dollars ($161,250) to Pakulis and Fifty Three Thousand Seven Hundred Fifty Dollars ($53,750) to Carrillo. The closing of the purchase took place on December 31, 2012. On July 11, 2013, the Company entered into a First Amendment to Promissory Note with each of Pakulis and Carrillo to extend the date that it will begin making payments thereunder from June 30, 2013, to September 30, 2013, and extended the maturity date of the notes by a corresponding six months. On November 8, 2013, effective as of September 30, 2013, the Company entered into a Second Amendment to Promissory Note with each of Pakulis and Carrillo to extend the date that it will begin making payments thereunder from September 30, 2013, to December 31, 2013, and extended the maturity date of the notes by a corresponding six months. On October 25, 2013, Carrillo converted the $53,750 outstanding balance of his note, plus $11,125 in accounts receivable for services rendered, into 395,805 shares of the Company's common stock. On March 19, 2014, effective as of December 31, 2013, the Company entered into a Third Amendment to Promissory Note with Pakulis to extend the date that it will begin making payments thereunder from December 31, 2013, to January 1, 2015, and extended the maturity date of the notes by a corresponding twelve months. On March 10, 2015, effective as of December 31, 2014, the Company entered into a Fourth Amendment to Promissory Note with Pakulis to extend the date that it will begin making payments thereunder from January 1, 2015, to January 1, 2017, and extended the maturity date of the note to December 15, 2018.

Note 14. Other Long Term Accrued Liabilities

At September 30, 2015, and December 31, 2014, the Company had a balance of $118,750 in noncurrent tax payable.

Note 15. Inventory Flooring Credit Line

On May 12, 2014, the Company entered into a consignment agreement (the "Consignment Agreement") and Indemnification Agreement with a third-party Inventory Financing Company (the "Inventory Financer"), pursuant to which the Inventory Financer will consign new and used manufactured home inventory to the Company's wholly owned subsidiary, Wisdom Manufactured Homes Of America, Inc. ("WMHOA"). Per the Consignment Agreement, WMHOA is to pay the Inventory Financer a monthly fee of one percent (1%) of the agreed consignment price for fees incurred during the prior calendar month, or prorated for any partial month. Fees for consigned property begin to accrue from (i) the date used inventory is consigned or (ii) in the case of new inventory, from the date the property is ready to ship and WMHOA has been notified of its readiness for shipment.

The consignment price for used inventory shall be One Thousand Dollars ($1,000) greater than the Inventory Financer's acquisition price for a singlewide manufactured home and Fifteen Hundred Dollars ($1,500) greater for a multisection home. The consignment price for new inventory shall be equal to the Inventory Financer's invoice price. WMHOA shall reduce the outstanding balance of consigned property by One Thousand Dollars ($1,000) per year, due on the anniversary of each respective consignment, and after the first anniversary of any consigned property, the monthly consignment fee with respect to such property shall increase from 1% to 1.4%. In the event any mobile home is consigned for eleven hundred (1,100) days or more, the entire balance owing shall be immediately due and payable. All money received by WMHOA for the purpose of selling a mobile home consigned by the Inventory Financer to WMHOA shall be held in trust for the benefit of the Inventory Financer until the entire outstanding balance owed for the consigned property is satisfied. Furthermore, the Inventory Financer shall have a security interest in all manufactured homes that have been financed by the Inventory Financer or for which the Inventory Financer has advanced any funds or incurred any obligation which has enabled WMHOA to acquire the manufactured homes.

The Consignment Agreement shall be effective for a term of five (5) years or for so long as there are manufactured homes consigned to WMHOA by the Inventory Financer. During the term of the Consignment Agreement, WMHOA will maintain insurance on all manufactured homes consigned to it by the Inventory Financer, and shall be responsible for any home that is destroyed or suffers more than Fifteen Hundred Dollars ($1,500) in damage. For a period of three (3) years following the termination of the Consignment Agreement, WMHOA shall not operate, own, mange, or in any way be affiliated with a mobile home sales facility within twenty (20) miles of WMHOA's facility located at 4888 FM 2264, Rhome, Texas, 76078.

On May 12, 2014, the Company entered into an addendum to the Consignment Agreement. Pursuant thereto, so long as WMHOA is current on all amounts owed to the Inventory Financer and maintains a consignment inventory of at least four (4) manufactured homes during the previous month, the consignment fee owed to the Inventory Financer shall be reduced from 1% to 0.8% per month, and prorated for any partial month. This reduced rate shall be in addition to a Ten Dollar ($10) monthly administration fee and does not pertain to any consigned inventory that has been held on consignment for more than one (1) year.

On May 21, 2014, the Company paid the Inventory Financer a Fifty Thousand Dollar ($50,000) security deposit, which the Inventory Financer can use to setoff past due amounts owed pursuant to the Consignment Agreement, should any exist in the future. In two (2) years, if WMHOA is in compliance with the Consignment Agreement and current on all amounts due and owing to the Inventory Financer thereunder, if any, the security deposit will be refunded to WMHOA. During November 2014, the Company paid the Inventory Financer an additional Twenty Five Thousand Dollar ($25,000) security deposit in connection with the opening of the Mt. Pleasant retail center.

During October 2014, the Company was offered, by the Inventory Financer, a no-interest financing program pursuant to which this one-time financing program effectively increased its flooring line by approximately $1 million.

At September 30, 2015, the Company had recorded $1,889,568 in the flooring credit line.

Note 16. Income Per Common Share

Income per common share is based on the weighted average number of common shares outstanding. The Company complies with Earnings Per Share, which requires dual presentation of basic and diluted earnings per share on the face of the statements of operations. Basic per share earnings or loss excludes dilution and is computed by dividing income (loss) available to common stockholders by the weighted-average common shares outstanding for the period. Diluted per share earnings or loss reflect the potential dilution that could occur if convertible preferred stock or debentures, options and warrants were to be exercised or converted or otherwise result in the issuance of common stock that is then shared in the earnings of the entity.

As of September 30, 2015, there were 2,064,957 common stock purchase warrants outstanding that were not included in the computation of diluted EPS because to do so would have been antidilutive for the period presented.

Note 17. Income Taxes

Deferred income taxes reflect the net tax effects of temporary differences between the carrying amounts of assets and liabilities for financial reporting purposes and the amounts used for tax purposes. Significant components of the Company's tax provisions and deferred tax assets as of September 30, 2015, and December 31, 2014 are as follows:

The components of tax provision:

The total tax provision for the nine months ended September 30, 2014, is zero. The total tax benefit for the year ended December 31, 2014, is $160,000 of which $176,000 corresponds to current operations and $16,000 (tax provision) corresponds to discontinued operations. 

The components of deferred tax assets and liabilities:

The ultimate realization of deferred tax assets depends upon the generation of future taxable income during the periods in which those temporary differences become deductible. Based upon the Company's loss for the nine months ended September 30, 2015, the Company has provided a valuation allowance in the amount of $985,000 against its deferred tax assets.

The amount of deferred tax assets considered realizable could change if future taxable income is realized. At both September 30, 2015, and December 31, 2014, the Company had U.S. federal tax net operating loss carryforwards ("NOLs") of approximately $3,473,403 and $1,125,000, respectively, which begin to expire in 2021. The NOLs are subject to limitations under IRC Section 382 of the Internal Revenue Code ("Section 382").

Note 18. Related Party Transactions

All material intercompany transactions have been eliminated upon consolidation of the Company's entities. During the nine months ended September 30, 2015, cash transfers, equity and accounts between the Company and its subsidiaries have been eliminated upon consolidation.

See Note 13. Notes Payable- Related Party for information regarding a Securities Purchase Agreement entered into on December 31, 2012, with Sportify, Inc., a Nevada corporation, and its shareholders, Sabas Carrillo, an individual, and James Pakulis, an individual and one of the Company's officers and directors.

See Note 13. Notes Payable- Related Party for information regarding a demand note with James Pakulis, who is a member of the Company's Board of Directors and serves as its Chief Executive Office, pursuant to which he loaned the Company $56,865.

Note 19. Commitments And Contingencies

The Company's executive offices are located in Tyler, Texas, at 500 N Northeast Loop 323, Tyler, Texas. The parcel is approximately a 1.8-acre tract of land. Pursuant to the terms of the lease, rent is $2,500 per month for 37 months. The Company is confident that this commercial space will provide adequate space to meet its needs and provide for future growth.

On July 1, 2014, the Company entered into a Lease Agreement for a two-acre lot, including office and parking, in Mt. Pleasant, Texas. The base rent is $2,500 per month, and the lease is for a period of 24 months.

The Company has consolidated the Jacksboro and Rhome retail centers into the Mount Pleasant retail center. Leases associated with the Jacksboro and Rhome centers have been terminated without penalty to the Company.

Set forth below is a summary of current obligations as of September 30, 2015, comprised exclusively of the rental lease obligations to make future payments due by the period indicated below:

Note 20. Warrants

As of September 30, 2015, there were 2,064,957 common stock purchase warrants outstanding. The following table summarizes information about common stock warrants outstanding at September 30, 2015.

Note 21. Subsequent Events

The Company evaluated its September 30, 2015 financial statements for subsequent events through November 22, 2015, the date the financial statements were available to be issued.

Issuance of Series A Convertible Preferred Stock to James Pakulis

On November 16, 2015, upon the filing of a Certificate of Designation of the Rights, Privileges, and Preferences of Series A Convertible Preferred Stock with the State of Nevada, we issued 10,000,000 shares of Series A Convertible Preferred Stock to James Pakulis, our sole officer and director, in exchange for the cancellation of accrued compensation in the amount of $13,000. Each share of Series A Convertible Preferred Stock is has 100 votes and is convertible into one share of our common stock. Further, we cannot effect a sale of all or substantially all of our assets, or a transaction that will result in a change of control, without the consent of a majority of the holders of the Series A Convertible Preferred Stock. The issuance was exempt from registration pursuant to Section 4(a)(2) of the Securities Act of 1933, the shareholder was accredited and familiar with our operations, and there was no solicitation in connection with the offering.

Carebourn Capital

Subsequent to the quarter ending September 30, 2015, the Company issued 13,914,302 shares of its common stock to Carebourn Capital, L.P. in satisfaction of debt.

LG Capital Funding,

Subsequent to the quarter ending September 30, 2015, the Company issued 3,920,614 shares of its common stock to LG Capital Funding, LLC in satisfaction of debt.

Typenex Co-Investment

Subsequent to the quarter ending September 30, 2015, the Company issued 6,787,945 shares of its common stock to Typenex Co-Investment, LLC in satisfaction of debt.

Vis Vires Group

Subsequent to the quarter ending September 30, 2015, the Company issued 37,969,748 shares of its common stock to Vis Vires Group, Inc. in satisfaction of debt.

Vista Capital Investments

Subsequent to the quarter ending September 30, 2015, the Company issued 9,000,000 shares of its common stock to Vista Capital Investments, LLC in satisfaction of debt.

Increase In Authorized Common Stock & Approval Of Reverse Split

Effective on October 26, 2015, our authorized common stock was increased from 300,000,000 shares, par value $0.001, to 900,000,000 shares, par value $0.001. The increase in authorized was unanimously approved by our Board of Directors on August 20, 2015, and by a majority of our outstanding shares of common stock at a special shareholder meeting held on October 23, 2015.

We held a Special Meeting of Shareholders on October 23, 2015, in Tyler, Texas. There were shareholders representing 57,136,360 votes present at the meeting, either in person or by proxy, which represented approximately 70.9% of the 80,555,383 total outstanding votes of the Company, so a quorum was present. The following agenda items set forth in the Company's 14A Proxy Statement on file with the Securities and Exchange Commission, were approved:

1. To approve an amendment to the Company's Articles of Incorporation to increase the authorized common stock from 300,000,000 shares, par value $0.001, to 900,000,000 shares, par value $0.001.

The agenda item passed with votes as follows:

2. To approve an amendment to the Company's Articles of Incorporation to effectuate a reverse split of the Company's issued and outstanding shares of common stock, at a time to be chosen by the Board of Directors in their sole discretion but not later than the close of business on December 31, 2016, on a ratio to be determined by the Company's Board of Directors but not to exceed 1-for-50.

The agenda item passed with votes as follows:

A more detailed description of each agenda item at the Special Shareholders Meeting can be found in our Schedule 14A Proxy Statement filed with the Securities and Exchange Commission on September 28, 2015.

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