10-Q

UNITED STATES 

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

FORM 10-Q

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

FOR THE QUARTERLY PERIOD ENDED MARCH 31, 2019

o 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: 333-141907

TAUTACHROME, INC.

(Exact name of registrant as specified in its charter)

 

Delaware	20-5034780
(State or other Jurisdiction of incorporation or organization)	(I.R.S. Employer Identification No.)

1846 e. Innovation Park Drive, Oro Valley, AZ 85755

(Address of principal executive offices)

(520) 318-5578

(Registrant’s telephone number, including area code)

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 o

Indicate by check mark whether the registrant is a large 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.

Large accelerated filer	¨	Accelerated filer	¨
Non-accelerated filer	¨	Smaller reporting company	x
(do not check if a smaller reporting company)		Emerging growth company	¨

 

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

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

The number of shares of the registrant’s common stock outstanding as of May 10, 2019, was 3,373,136,999.

TAUTACHROME, INC.

FORM 10-Q

INDEX

PART I – FINANCIAL INFORMATION
Item 1 –	Consolidated Financial Statements	3
Item 2 –	Management’s Discussion And Analysis Of Financial Condition And Results Of Operations	18
Item 3 –	Quantitive And Qualitative Disclosures About Market Risk	20
Item 4 –	Controls and Procedures	20
PART II – OTHER INFORMATION
Item 1 –	Legal Proceedings	21
Item 1A –	Risk Factors	21
Item 2 –	Unregistered Sale of Equity Securities	21
Item 3 –	Defaults Upon Senior Securities	21
Item 4 –	Mine Safety Disclosures	21
Item 5 –	Other Information	21
Item 6 –	Exhibits	21
Signatures		22

2

PART I – FINANCIAL INFORMATION

ITEM 1 – CONSOLIDATED FINANCIAL STATEMENTS

TAUTACHROME, INC.

CONSOLIDATED BALANCE SHEETS

(Unaudited)

	3/31/2019			12/31/2018
ASSETS
Current assets:
Cash	$	3,984		$	6,243
Total current assets		3,984			6,243
TOTAL ASSETS	$	3,984		$	6,243
LIABILITIES
Accounts payable and accrued expenses	$	649,388		$	615,847
Accounts payable - related party		114,148			114,052
Loans from related parties		103,203			103,074
Convertible notes payable - related party		88,152			81,340
Short-term convertible notes payable, net		641,822			627,928
Convertible notes payable in default		267,056			422,565
Short-term notes payable		15,612			15,501
Derivative liability		162,669			365,497
Court judgment liability		250,000			250,000
Total current liabilities		2,292,050			2,595,804
Long-term convertible notes payable, net		70,882			25,000
Long-term convertible notes payable, related party, net		32,825			32,825
Crypto-currency notes payable		100,000			100,000
Total non-current liabilities		203,707			157,825
TOTAL LIABILITIES		2,495,757			2,753,629
STOCKHOLDERS' EQUITY (DEFICIT)
Series D Convertible Preferred, par value $0.0001. 13,795,104 shares authorized, 13,795,104 shares issued and outstanding at March 31, 2019 and December 31, 2018		1,380			1,380
Common stock, $0.00001 par value. Six billion shares authorized. 2,871,747,062 and 1,932,483,910 shares issued and outstanding at March 31, 2019 and December 31, 2018, respectively		28,717			19,325
Additional paid in capital		5,221,825			4,692,609
Common stock payable		1,919,927			1,919,927
Accumulated deficit		(9,753,959	)		(9,476,829	)
Effect of foreign currency exchange		90,337			96,202
TOTAL STOCKHOLDERS' EQUITY		(2,491,773	)		(2,747,386	)
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY	$	3,984		$	6,243

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

3

TAUTACHROME, INC.

CONSOLIDATED STATEMENTS OF OPERATIONS

(Unaudited)

	Three Months Ended March 31,
	2019			2018
OPERATING EXPENSES
General and administrative		130,220			307,425
Total operating expenses		130,220			307,425
Operating loss		(130,220	)		(307,425	)
OTHER INCOME / (EXPENSE)
Gain on settlement of debt		1,330			-
Interest expense		(85,825	)		(579,947	)
Change in value of derivatives		58,360			(702,785	)
Loss on conversion of debt		(120,775	)		-
Total other		(146,910	)		(1,282,732	)
Net loss	$	(277,130	)	$	(1,590,157	)
OTHER COMPREHENSIVE INCOME (LOSS)
Effect of foreign currency exchange		(5,865	)		14,707
Net comprehensive income or (loss)	$	(282,995	)	$	(1,575,450	)
Net (loss) or income per common share, basic and diluted	$	0.00		$	0.00
Weighted average shares outstanding, basic and diluted		2,300,781,103			1,696,249,730

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

4

TAUTACHROME, INC.

CONSOLIDATED STATEMENT OF STOCKHOLDERS’ EQUITY / (DEFICIT)

(Unaudited)

	Common Stock				Preferred Stock Series D				Additional Paid		Stock		Other Comprehensive			Accumulated			Total Stockholders' Equity /
	Shares		Amount		Shares		Amount		in Capital		Payable		Income (Loss)			Deficit			(Deficit)
Balance, 12/31/17		1,685,941,636	$	16,860		13,795,104	$	1,380	$	3,787,675	$	23,186	$	15,540		$	(5,293,041	)	$	(1,448,400	)
Shares issued with convertible note payable		15,000,000		150		-		-		127,350		-		-			-			127,500
Preferred Series E shares accrued to ArKnet		-		-		-		-		-		1,837,000		-			-			1,837,000
Shares issued for conversion of debt		221,542,274		2,215		-		-		373,414		-		-			-			375,629
Shares issued to settle lawsuit		10,000,000		100		-		-		59,900		-		-			-			60,000
Derivative associated with early debt retirement		-		-		-		-		326,339		-		-			-			326,339
Shares earned by consultants		-		-		-		-		-		59,741		-			-			59,741
Imputed interest		-		-		-		-		17,931		-		-			-			17,931
Effect of foreign currency exchange		-		-		-		-		-		-		80,662			-			80,662
Net loss		-		-		-		-		-		-		-			(4,183,788	)		(4,183,788	)
Balance, 12/31/18		1,932,483,910	$	19,325		13,795,104	$	1,380	$	4,692,609	$	1,919,927	$	96,202		$	(9,476,829	)	$	(2,747,386	)
Shares issued for conversion of debt		935,640,097		9,356		-		-		345,841		-		-			-			355,197
Shares issued to settle claim		3,623,055		36		-		-		3,587		-		-			-			3,623
Derivative associated with early debt retirement		-		-		-		-		175,780		-		-			-			175,780
Imputed interest		-		-		-		-		4,008		-		-			-			4,008
Effect of foreign currency exchange		-		-		-		-		-		-		(5,865	)		-			(5,865	)
Net loss		-		-		-		-		-		-		-			(277,130	)		(277,130	)
Balance, March 31, 2019		2,871,747,062	$	28,717		13,795,104	$	1,380	$	5,221,825	$	1,919,927	$	90,337		$	(9,753,959	)	$	(2,491,773	)

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

5

TAUTACHROME, INC.

CONSOLIDATED STATEMENTS OF CASH FLOWS

(Unaudited)

	Three Months Ended March 31,
	2019			2018
CASH FLOWS FROM OPERATING ACTIVITIES
Net Loss	$	(277,130	)	$	(1,590,157	)
Stock-based compensation		-			21,420
Loss on conversions		120,775			-
Change in fair value of derivative		(58,360	)		702,785
Gains on debt settlements		(1,330	)		-
Amortization of discounts on notes payable		48,934			534,430
Imputed interest		4,008			4,750
Changes in operating assets and liabilities:
Accounts payable and accrued expenses		54,422			25,384
Accounts payable - related party		-			-
Net cash used in operating activities		(108,681	)		(301,388	)
CASH FLOWS FROM FINANCING ACTIVITIES
Proceeds from convertible notes payable		105,475			593,000
Principal payments on notes payable		-			(97,150	)
Proceeds from related-party loans		18,000			1,830
Principal payments on related-party loans		(11,188	)		-
Net cash provided by financing activities		112,287			497,680
Effect of exchange rate changes on cash and cash equivalents		(5,865	)		14,707
Net increase/(decrease) in cash		(2,259	)		210,999
Cash and equivalents - beginning of period		6,243			9,726
Cash and equivalents - end of period	$	3,984		$	220,725
SUPPLEMENTARY INFORMATION
Cash paid for interest	$	-		$	2,720
Cash paid for income taxes	$	-		$	-
SUPPLEMENTAL DISCLOSURES OF NON-CASH FINANCING TRANSACTIONS
Discounts on convertible notes	$	31,312		$	664,688
Conversion of debt to common stock	$	234,422		$	11,155
Settlement of derivative liability	$	175,780		$	93,280
Shares issued for debt settlement	$	3,623		$	-

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

6

TAUTACHROME, INC.

NOTES TO UNAUDITED FINANCIAL STATEMENTS

MARCH 31, 2019

Note 1 – Organization and Nature of Business

History

Tautachrome, Inc. was formed in Delaware on June 5, 2006 as Caddystats, Inc. and hereinafter collectively referred to as “Tautachrome”, the “Company”, “we’ or “us”).

The Company adopted the accounting acquirer’s year end, December 31.

Our Business

Tautachrome operates in the internet applications space, a large space we believe to be uniquely able to make possible fast growing and novel business. The iPhone, Google, Facebook, Amazon, Uber and numerous other examples are reminders of the ability of the internet applications space to surprise us with new business universes out of nowhere. A recent surprise was the arrival in the internet applications space of blockchain technology, which is empowering enterprises of all sizes to create ecosystems of trade based on self-introduced and globally useable cryptocurrencies. The arrival of blockchain technology has added a significant new and leading element to Tautachrome’s business plans and activities. The subsequent development of a new patent pending technology dubbed ArK technology that exploits augmented reality in a new solution to the purchasing interaction between global consumers and providers is a brand new surprise, and has been licensed by the Company for development.

Tautachrome is currently pursuing three main avenues of business activity based on our patented activated imaging technology, our blockchain cryptocurrency products, and the ArK patent pending technology (together banded “KlickZie” technology):

1.	KlickZie ArK technology business: The Company has licensed and is developing a new KlickZie augmented reality (often abbreviated AR) technology called “ArK technology which permits goods and services providers to establish geolocated augmented reality interfaces, called ArKs, allowing consumers to interact with inside info on the provider’s products, specials and discounts with live purchasing provided. A provider’s ArK may be located anywhere on earth, at a store location, or anywhere else the provider may desire. The ArKnet is a fintech platform connecting consumers to providers in the global $48 trillion household purchasing market, using augmented reality as the medium of interaction.
2.	KlickZie’s blockchain cryptocurrency based ecosystem: our recently added activity to create our own KlickZie blockchain and cryptocurrency to incentivize user download of KlickZie products and to provide a crypto based monetary stream to the Company, and
3.	KlickZie Activated Digital Imagery business: our longstanding flagship activity to develop and monetize downloadable apps based on our patented KlickZie trusted imaging technology and based on our patented trusted image-based social interactions using the pictures and videos that smartphone users generate on the web using their KlickZie imaging app.

Since its public announcement on September 25, 2017 (via SEC form 8-K) that it would be using its Twitter site (@Tautachrome_Inc) (http://twitter.com/tautachrome_inc) to post important Company information, and finding this method of publicizing important Company information both fast and effective, the Company has continued to use this means of public communication almost exclusively, supplemented only occasionally with Current Reports via SEC form 8-Ks. Shareholders are advised to follow us on Twitter to be current on the Company’s FD disclosures.

7

Note 2 – Basis of Presentation and Summary of Significant Accounting Policies

Consolidated Financial Statements

In the opinion of management, the accompanying financial statements includes all adjustments (which include only normal recurring adjustments) necessary to present fairly the financial position, results of operations, and cash flows for the period ending March 31, 2019. Preparing financial statements requires management to make estimates and assumptions that affect the reported amounts of assets, liabilities, revenue, and expenses. Interim results are not necessarily indicative of results for a full year. The information included in this Form 10-Q should be read in conjunction with information included in our audited financial statements for the period ended December 31, 2018 (as amended), as reported in Form 10-K filed with the Securities and Exchange Commission.

Management further acknowledges that it is solely responsible for adopting sound accounting practices, establishing and maintaining a system of internal accounting control and preventing and detecting fraud. The Company's system of internal accounting control is designed to assure, among other items, that 1) recorded transactions are valid; 2) valid transactions are recorded; and 3) transactions are recorded in the proper period in a timely manner to produce financial statements which present fairly the financial condition, results of operations and cash flows of the Company for the respective periods being presented.

Principles of Consolidation

Our consolidated financial statements include the accounts of Tautachrome, Inc. and all majority-owned subsidiaries. All significant inter-company accounts and transactions are eliminated in consolidation.

Long-Lived Assets, Intangible Assets and Impairment

In accordance with U.S. GAAP, the Company’s long-lived assets and amortizable intangible assets are tested for impairment whenever events or changes in circumstances indicate that their carrying value may not be recoverable. The Company assesses the recoverability of such assets by determining whether their carrying value can be recovered through undiscounted future operating cash flows, including its estimates of revenue driven by assumed market segment share and estimated costs. If impairment is indicated, the Company measures the amount of such impairment by comparing the fair value to the carrying value.

Use of Estimates

The preparation of financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates.

8

Net Loss Per Share

Basic and diluted net loss per share calculations are calculated on the basis of the weighted average number of common shares outstanding during the year. The per share amounts include the dilutive effect of common stock equivalents in years with net income. Basic and diluted loss per share is the same for the three months ended March 31, 2019 as the effect of our potential common stock equivalents would be anti-dilutive.

Recent Accounting Pronouncements

In February 2016, the FASB established Topic 842, Leases, by issuing Accounting Standards Update (ASU) No. 2016-02, which requires lessees to recognize leases on-balance sheet and disclose key information about leasing arrangements. The new standard establishes a right-of-use model (ROU) that requires a lessee to recognize a ROU asset and lease liability on the balance sheet for all leases with a term longer than 12 months. Leases will be classified as finance or operating, with classification affecting the pattern and classification of expense recognition in the income statement.

The new standard was effective for us on January 1, 2019 and we have adopted it. A modified retrospective transition approach is required, applying the new standard to all leases existing at the date of initial application. An entity may choose to use either (1) its effective date or (2) the beginning of the earliest comparative period presented in the financial statements as its date of initial application. If an entity chooses the second option, the transition requirements for existing leases also apply to leases entered into between the date of initial application and the effective date. The entity must also recast its comparative period financial statements and provide the disclosures required by the new standard for the comparative periods. We expect to adopt the new standard on January 1, 2019 and use the effective date as our date of initial application. Consequently, financial information will not be updated and the disclosures required under the new standard will not be provided for dates and periods before January 1, 2019. The Company does not expect the adoption of this ASU to have a material impact on its consolidated financial statements as the Company has no leases whose term is greater than one year.

In February 2018, the FASB issued ASU No. 2018-02, Reclassification of Certain Tax Effects from Accumulated Other Comprehensive Income . The guidance permits entities to reclassify tax effects stranded in Accumulated Other Comprehensive Income as a result of tax reform to retained earnings. This new guidance is effective for annual and interim periods in fiscal years beginning after December 15, 2018. Early adoption is permitted in annual and interim periods and can be applied retrospectively or in the period of adoption. The Company is currently in the process of evaluating the impact of adoption on its consolidated financial statements.

9

In March 2018, the FASB issued ASU No. 2018-05, Income Taxes (Topic 740) - Amendments to SEC Paragraphs Pursuant to SEC Staff Accounting Bulletin No. 118. The amendment provides guidance on accounting for the impact of the Tax Cuts and Jobs Act (the “Tax Act”) and allows entities to complete the accounting under ASC 740 within a one-year measurement period from the Tax Act enactment date. This standard is effective upon issuance. The Tax Act has several significant changes that impact all taxpayers, including a transition tax, which is a one-time tax charge on accumulated, undistributed foreign earnings. The calculation of accumulated foreign earnings requires an analysis of each foreign entity’s financial results going back to 1986. The Company does not expect the adoption of this ASU to have a material impact on its consolidated financial statements.

In June 2018, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) 2018-07, Compensation-Stock Compensation (Topic 718): Improvements to Nonemployee Share-Based Payment Accounting , which expands the scope of Topic 718 to include share-based payment transactions for acquiring goods and services from nonemployees. An entity should apply the requirements of Topic 718 to nonemployee awards except for specific guidance on inputs to an option pricing model and the attribution of cost (that is, the period of time over which share-based payment awards vest and the pattern of cost recognition over that period). The new guidance is effective for all entities for annual periods, and interim periods within those annual periods, beginning after December 15, 2017, with early adoption permitted. The Company does not expect the adoption of this ASU to have a material impact on its consolidated financial statements.

Note 3 – Going Concern

We have not begun our core operations in the technology industry and have not yet acquired the assets to enter this markets and we will require additional capital to do so. There is no guarantee that we will acquire the capital to procure the assets to enter this market or, upon doing so, that we will generate positive cash flows from operations. Substantial doubt exists as to Tautachrome’s ability to continue as a going concern. No adjustment has been made to these financial statements for the outcome of this uncertainty.

Note 4 – Related Party Transactions

For the three months ended March 31, 2019, we accrued $1,213 of interest to the 22^nd Trust (the “Trust”), the trustee of whom is Sonny Nugent, the son of our major shareholder and former Chief Executive Officer, Micheal Nugent. The outstanding balances of unpaid principal and interest at March 31, 2019 and December 31, 2018 were $119,947 and $118,591, respectively.

According to our agreement with Mr. Nugent, we accrue interest on all unpaid amounts at 5%. Principal and interest are callable at any time. If principal and interest are called and not repaid, the loan is considered in default after which interest is accrued at 10%.

Convertible note payable, related party

On May 5, 2013 (and on August 8, 2013 with an enlargement amendment) the Company entered into a no interest demand-loan agreement with our current Chairman, Jon N. Leonard under which the Company may borrow such money from Jon as Jon in his sole discretion is willing to loan.

The terms of the note provide that at the Company’s option, the Company may make repayments in stock, at a fixed share price of $1.00 per share. Also, because this loan is a no-interest loan, an imputed interest expense of $1,520 was recorded as additional paid-in capital for the three months ended March 31, 2019. The Company evaluated Dr. Leonard’s note for the existence of a beneficial conversion feature and determined that none existed.

During the three months ended March 31, 2019, we repaid Dr. Leonard $11,188 and borrowed an additional $18,000.

10

Note 5 – Capital

During the year ended December 31, 2018 we issued 246,542,274 shares as follows:

· We settled our lawsuit with Richard Morgan in full by issuing 10 million shares. We valued the shares at their grant date fair values, removing the judgment liability of $5,000 and recording a $55,000 loss on litigation.

· We issued 15,000,000 shares as an equity incentive to a creditor. We valued the shares at their grant-date fair values and recorded a discount on that debt of $127,500.

· We issued 221,542,274 shares in conversion of outstanding convertible promissory notes. We recorded a reduction of the balance of these notes of $306,623 and $27,728 of principal and interest, respectively and recorded a loss on conversion of $41,278. As part of these conversions, we retired $326,339 of associated derivative liabilities which we included in Additional Paid in Capital.

 

During the three months ended March 31, 2019, we issued 939,263,152 shares as follows:

· We issued 935,640,097 shares in conversion of outstanding convertible promissory notes. We recorded a reduction of the balance of these notes of $218,508 of principal, $11,914 of interest, and $4,000 of conversion fees and recorded a loss on conversion of $120,775. As part of these conversions, we retired $175,780 of associated derivative liabilities which we included in Additional Paid in Capital.

· We issued 3,623,055 to a certain Australian individual who made baseless claims against the Company other than two existing convertible promissory notes which the Company acknowledged. Rather than engage in a prolonged international legal matter, we issued these shares in complete satisfaction of any and all claims against the Company. We valued the shares at their grant date fair values, reduced unpaid principal and interest in the amount of $4,258 and $695, respectively, and recorded a $1,330 gain on this settlement.

 

Preferred Stock

During the year ended December 31, 2018, we accrued $1,837,000 in costs related to the 40,000 Series E Preferred shares promised in our ArKnet contract (see Note 4) containing a par value of $0.0001. This series of preferred shares have the following rights, limitations, restrictions and privileges:

· They are not entitled to dividends,

· They are entitled to no liquidations rights,

· Each share has the voting rights of all other voting shares combined, multiplied by 0.00001,

· They have no conversion or redemption rights.

 

These shares were issued subsequent to the March 31, 2019 balance sheet and are included in stock payable at that date.

Imputed Interest

Certain of our promissory notes bear no nominal interest. We therefore imputed interest expense and increase Additional Paid in Capital. For the three months ended March 31, 2019, we imputed $4,008 of such interest.

11

Note 6 – Debt

Loans from related parties

As is discussed in Note 4, at March 31, 2019 we owed $208,099 in related-party debts consisting of $98,203 and $21,744 in unpaid principal and interest, respectively, to the 22^nd Trust and $88,152 owed to our CEO, Dr. Jon Leonard.

Convertible notes payable

During the year ended December 31, 2018, we issued eight new convertible promissory notes in the amount of $633,000, containing original issue discounts totaling $71,688, for net proceeds of $561,313). These convertible notes can convert to common stock at various different prices. We evaluated these convertible notes for beneficial conversion features and calculated a collective value of $209,040 which we are accounting for as debt discounts. The individual notes are discussed in Note 6 to the financial statements filed on Form 10-K for the year ended December 31, 2018 and are hereby incorporated by reference.

During the three months ended March 31, 2019 we issued three convertible promissory notes in the aggregate amount of $105,475, receiving proceeds therefrom of the same amount. These convertible notes can convert to common stock at various prices. We evaluated these convertible notes for beneficial conversion features and calculated a collective value of $31,312 which we are accounting for as debt discounts. These three convertible notes are discussed below:

· On January 11, 2019, we issued a convertible note in the amount of $100,000 which accrues interest at 5% (10% for unpaid interest and principal after maturity) and matures on July 8, 2020. This note can convert to 83,333,333 shares.

· On January 23, 2019, we issued a convertible note in the amount of $1,475 which accrues interest at 5% (10% for unpaid interest and principal after maturity) and matures on July 23, 2020. This note can convert to 1,109,023 shares.

· On January 16, 2019, we issued a convertible note in the amount of $4,000 which accrues interest at 5% (10% for unpaid interest and principal after maturity) and matures on July 16, 2020. This note can convert to 3,007,519 shares.

 

During the three months ended March 31, 2019, we issued 3,623,055 to a certain Australian individual who made baseless claims against the Company other than two existing convertible promissory notes which the Company acknowledged. Rather than engage in a prolonged international legal matter, we issued these shares in complete satisfaction of any and all claims against the Company. We valued the shares at their grant date fair values, reduced unpaid principal and interest in the amount of $4,258 and $695, respectively, and recorded a $1,330 gain on this settlement.

During the three months ended March 31, 2019, we amortized $48,934 of debt discounts to interest expense and accrued $29,224 of interest on existing notes.

At March 31, 2019, $267,056 of our convertible notes payable were in default.

12

Convertible notes payable (excluding related-party convertible notes which is discussed in Note 4) at March 31, 2019 and December 31, 2018 and their classification into long-term, short-term and in-default were as follows:

	03/31/19			12/31/18
All convertible promissory notes
Unpaid principal		1,007,889			1,121,243
Discounts		(28,129	)		(45,750	)
Convertible notes payable, net	$	979,760		$	1,075,493
Classified as short-term
Unpaid principal balance		642,182			673,678
Discounts		(360	)		(45,750	)
Convertible notes payable - short-term, net	$	641,822		$	627,928
Classified as long-term
Unpaid principal balance		98,651			25,000
Discounts		(27,769	)		-
Convertible notes payable - short-term, net	$	70,882		$	25,000
Classified as in default
Unpaid principal balance		267,056			422,565
Discounts		-			-
Convertible notes payable - short-term, net	$	267,056		$	422,565

Crypto-currency notes payable

On August 7, 2018, we issued a Crypto Exchange Promissory Note (“the Crypto Note”) in exchange for $100,000 in cash. The Crypto Note accrues interest at 4% until maturity which is 18 months from issue and 10% after maturity. The holder can convert unpaid principal and accrued interest into KLK20 tokens at any time at the rate of $0.25 per token. The holder may, for up to nine months after issuance, participate in a price guarantee: if the Company offers the tokens at less than $0.25 per token at any point for up to nine months after issuance, then the holder has the option of participating in the offer at the lower price.

Derivative liabilities

The above-referenced convertible promissory notes issued during the three months ended March 31, 2019 were analyzed in accordance with EITF 07–05 and ASC 815. EITF 07–5, which is effective for fiscal years beginning after December 15, 2009, and interim periods within those fiscal years. The objective of EITF 07–5 is to provide guidance for determining whether an equity–linked financial instrument is indexed to an entity’s own stock. This determination is needed for a scope exception under Paragraph 11(a) of ASC 815 which would enable a derivative instrument to be accounted for under the accrual method. The classification of a non–derivative instrument that falls within the scope of EITF 00–19 “Accounting for Derivative Financial Instruments Indexed to, and Potentially Settled in, a Company’s Own Stock” also hinges on whether the instrument is indexed to an entity’s own stock. A non–derivative instrument that is not indexed to an entity’s own stock cannot be classified as equity and must be accounted for as a liability. The EITF reached a consensus that would establish a two–step approach in determining whether an instrument or embedded feature is indexed to an entity’s own stock. First, the instrument's contingent exercise provisions, if any, must be evaluated, followed by an evaluation of the instrument's settlement provisions.

13

Derivative financial instruments should be recorded as liabilities in the consolidated balance sheet and measured at fair value. For purposes of this engagement and report, we utilized fair value as the basis for formulating our opinion which has been defined by the Financial Accounting Standards Board (“FASB”) as “the amount for which an asset (or liability) could be exchanged in a current transaction between knowledgeable, unrelated willing parties when neither party is acting under compulsion”. The FASB has provided guidance that its definition of fair value is consistent with the definition of fair market value in IRS Rev. Rule 59–60.

The Company issued Subscription Notes from 2015 through March 31, 2019 in the United States and Australia which are convertible at discounted market rates and market prices based on the average of 5 trading day closing bids. The notes are convertible after 1 year from issuance; mature in 18 months from issuance; accrued at 5% interest; and a 10% default rate. These convertible notes have become tainted (“The Tainted Notes) as a result of the issuance of convertible promissory notes issued in the United States since there is a possibility (however remote) that the Company would not have enough shares in the Treasury to satisfy all possible conversions.

The Convertible Note derivatives were valued as of issuance; conversion; redemption/settlement; and each quarterly period from March 31, 2018 through March 31, 2019. The following assumptions were used for the valuation of the derivative liability related to the Notes:

· The stock price of $0.0013 to $0.0005 in this period would fluctuate with the Company projected volatility.

· The notes convert with variable conversion prices based on the percentages of the low or average trades or bids over 20 to 25 trading days.

· The effective discounts rates estimated throughout the periods range from 35% to 42% with potentially an additional discount.

· The Holder would automatically convert the note before maturity if the registration was effective and the company was not in default.

· The projected annual volatility for each valuation period was based on the historic volatility of the company are 157.8 – 296.0% (annualized over the term remaining for each valuation).

· An event of default would occur 0% of the time, increasing 1.00% per month to a maximum of 20%.

· The Holders would redeem the notes (with penalties up to 50% depending on the date and full–partial redemption) based on availability of alternative financing of 0% of the time, increasing 1.00% per month to a maximum of 5%.

· The Holder would automatically convert the note at the maximum of 2 times the conversion price or the stock price on the date of valuation.

· The Holder would automatically convert the note based on ownership or trading volume limitations.

 

We recorded the initial derivative as both a derivative liability and a debt discount (or initial reduction in carrying value of the debt). We then amortized the debt discounts using the Effective Interest Method which recognizes the cost of borrowing at a constant interest rate throughout the contractual term of the obligation. The effective interest rates on the six instruments issued during the year ended December 31, 2018 range from 243% to 289%.

At each reporting date, we determine the fair market value for each derivative associated with each of the above instruments. At March 31, 2019, we determined the fair value of these derivatives were $162,668.

14

Changes in outstanding derivative liabilities are as follows:

Balance, December 31, 2018	$	365,497
Changes due to new issuances		31,312
Changes due to extinguishments		(175,780	)
Changes due to adjustment to fair value		(58,360	)
Balance, March 31, 2019	$	162,669

Note 7 – Litigation

Morgan Lawsuit

Background

The May 21, 2015 merger of the Company with Click Evidence, Inc. (“Click”) resulted in the transfer of Click’s assets and interests from Click to the Company and in Click becoming an asset-less entity inside the Company and then being disposed of on November 25, 2015. In the November 25, 2015 conveyance of the Click to the new owner, its name was changed to BH Trucking, Inc. (“BH”).

Filing and service

A first lawsuit was filed in the Superior Court of the State of Arizona, Pima County, by a former consultant to Click, Richard Morgan (“Morgan”). This lawsuit was served on December 2, 2015, against Click/BH, with the Company also named in the lawsuit, but not served by it or effectively made aware of it until 2017.

Allegation

The lawsuit claimed that the consultant’s agreement with Click/BH permitted him to recover a finder’s fee for the cashless stock swap that achieved the merger on May 21, 2015. The new owner of Click/BH, the only party served, declined to defend the lawsuit allowing it to go to default.

15

Default judgment

On December 16, 2016, the Court issued a default judgment for the plaintiff and against the defendants in the amount of $2,377,915. The Company believes that having not been served or made aware of the lawsuit, it is not a target of the judgment.

Second Lawsuit

On January 23, 2017, the Company and its CEO were served in a second lawsuit by Morgan alleging that the Company’s intellectual property assets that were transferred to it by Click under the May 21, 2015 merger of the Company with Click, were fraudulently removed from Click/BH, and seeks to have them returned to Click/BH.

Effect on the Financial Statements

During the three months ended September 30, 2017 we included in liabilities the default amount of $2,377,915 plus $4,459 interest at 4.5% from December 16, 2016, the date of the judgment, to December 31, 2016.

On August 29, 2017, the Court set aside the judgment in the First Lawsuit resulting in the removal of the liability of $2,377,915 and accrued interest of $4,459 at December 31, 2016, as well as the additional accrued interest recorded during 2017 of $44,294, for a total gain of $2,426,668.

On August 14, 2018, we settled this lawsuit in full by issuing 10 million shares. We valued the shares at their grant date fair values, removing the judgment liability of $5,000 and recording a $55,000 loss on litigation.

McRae Lawsuit

On October 10, 2017, the Company received a letter from the lawyer of Eric L McRae (“McRae”) a person whose association with the Company was terminated by the Company on June 16, 2017. The letter demanded payment of 850 million unrestricted Tautachrome common shares to forestall his filing a laundry list of complaints in a variety of government agencies including with the US District Court in Kansas with complaints of contract breaches and fraud by silence, with the EEOC with complaints of termination by racial discrimination, with the OSHA with complains of termination for reasons of his being a whistleblower under Sarbanes-Oxley provisions, and with various regulatory agencies with accusations of an unspecified nature.

On October 12, 2017, McRae filed a complaint, later amended twice, against the Company in the US District Court in Kansas. The amended complaint alleges 1) that the Company breached a written agreement in an alleged employment by failing to pay him 35 million shares of the Company’s common stock and terminating his association with the Company on June 16, 2017 without proper notice. The complaint goes on to allege 2) that the Company committed fraud by silence for failing to inform him of an intent to receive the benefit of his services while harboring an intent to not compensate him, 3) that the Company breached an unwritten agreement with him to provide him with 185 million shares of the Company’s common stock, and 4) that the Company breached a convertible promissory note by failing and refusing to repay him the principal and accrued interest thereunder. Complaint number 4 is now moot in the belief of the Company since after the lawsuit was filed the Company continued to repay McRae’s convertible promissory note on schedule with interest due until paid in full on October 1, 2018, thus extinguishing the note and making the matter moot. These matters remain before the Court.

16

On December 12, 2017, McRae brought the Company before the Kansas Human Rights Commission and the U.S. Equal Employment Opportunity Commission (EEOC) alleging that on June 16, 2017 he was terminated from an alleged employment by the Company on the basis of race and for retaliation, and that the Company discriminated against him in the terms of this alleged employment because of race. The Company, knowing that all of McRae’s allegations before the EEOC are completely false, responded to the threatened complaint denying each of McRae’s allegations and providing its own presentation of the facts. The matter is presently stayed pending a claim for mediation by McRae who has so far failed to file a claim. Although the Company remains confident that should an investigation in this matter continue, it will fully prevail. We do not know when or if such an investigation will materialize.

On December 8, 2017, McRae filed a complaint with the Occupational Safety and Health Administration (the “OSHA”), alleging that his “investigation and reporting” to the Company’s CEO was a contributing factor in the termination of his alleged employment by the Company in violation of the Sarbanes-Oxley Act whistleblower’s provisions. On January 2, 2018, the Company delivered its response to the complaint, denying each of McRae’s allegations and providing its own presentation of the facts. McRae dismissed the OSHA claim with prejudice, and the matter cannot be brought again.

On October 17, 2018, we offered McRae 50 million shares in settlement of all outstanding legal actions against us. McRae declined the offer. However, we re-evaluated the liability on these lawsuits from $49,000 to $250,000 based on the closing price of our common stock on the date of the offer. We recognized a loss on litigation of $201,000 in so doing during 2018.

The Company, believing that allegations made by McRae are largely fabricated and aimed at doing harm, has been vigorously defending itself and believes it will prevail in every instance. Despite this belief, to save legal expense the Company made a good faith settlement offer to McRae. The offer was rejected.

Note 8 – Income Taxes

Deferred income taxes reflect the tax consequences on future years of differences between the tax bases:

	03/31/19			12/31/18
Net operating loss carry-forward		3,662,833			3,380,285
Deferred tax asset at 21%	$	769,195		$	709,860
Valuation allowance		(769,195	)		(709,860	)
Net future income taxes	$	-		$	-

In assessing the realizability of future tax assets, management considers whether it is more likely than not that some portion or all of the future tax assets will not be realized. The ultimate realization of future tax assets is dependent upon the generation of future taxable income during the periods in which those temporary differences become deductible. Management considers the scheduled reversal of future tax liabilities, projected future taxable income and tax planning strategies in making this assessment. Management has provided for a valuation allowance on all of its losses as there is no assurance that future tax benefits will be realized.

Our tax loss carry-forwards will begin to expire in 2030.

Note 9 – Subsequent Events

We issued 501,389,937 shares in conversion of debt.

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

This report contains “forward-looking statements”. All statements other than statements of historical fact are “forward-looking statements” for purposes of federal and state securities laws, including: any projections of earnings, revenues or other financial items; any statements of the plans, strategies and objectives of management for future operations; any statements concerning proposed new products, services or developments; any statements regarding future economic conditions or performance; any statements of belief; and any statements of assumptions underlying any of the foregoing. “Forward-looking statements” may include the words “may,” “will,” “estimate,” “intend,” “continue,” “believe,” “expect,” “plan” or “anticipate” and other similar words.

 Although we believe that the expectations reflected in our “forward-looking statements” are reasonable, actual results could differ materially from those projected or assumed. Our future financial condition and results of operations, as well as any “forward-looking statements”, are subject to change and to inherent risks and uncertainties, such as those disclosed in this report. In light of the significant uncertainties inherent in the “forward-looking statements” included in this report, the inclusion of such information should not be regarded as a representation by the Company or any other person that the objectives and plans of the Company will be achieved. Except for its ongoing obligation to disclose material information as required by the federal securities laws, we do not intend, and undertake no obligation, to update any “forward-looking statement”. Accordingly, the reader should not rely on “forward-looking statements”, because they are subject to known and unknown risks, uncertainties, and other factors that may cause actual results to differ materially from those contemplated by the “forward-looking statements”.

You should read the following discussion and analysis of our financial condition and results of operations in conjunction with our unaudited financial statements, including the notes to those financial statements, included elsewhere in this report.

Overview

We are an early stage internet applications company, engaged in advanced technology and business development in the internet applications space. We have incurred general and administrative costs, marketing expenses and research and development costs since we commenced our current operations in May 2015, against no revenue.

The continuing operations of the Company are dependent upon our ability to raise adequate financing and to commence profitable operations in the future. The Company may raise additional capital through the sale of its equity securities, through an offering of debt securities, or through loans from related parties. We believe that actions presently being taken to obtain additional funding may provide the opportunity for the Company to continue as a going concern. There is no guarantee, however, that the Company will be successful in achieving these objectives.

Results of Operations - Three months ended March 31, 2019 versus 2018

We had general and administrative expenses of $130,220 for the three months ended March 31, 2019 versus $307,425 for the same period in 2018. The decrease is mainly due to decreases in legal fees and certain expenses associated with our financing arrangements in the first quarter of 2018 that we did not incur in the current period.

18

As is discussed in Note 5 to the financial statements, we had a gain of $1,330 on the settlement of certain Australian convertible promissory notes during the three months ended March 31, 2019. We had no such gain in the previous period.

We had a reduction of interest expense from $579,947 during the three months ended March 31, 2018 to $85,825 in the current period. The vast majority of the change was due to certain one-time discount amortization associated with the six convertible promissory notes issued during the quarter ended March 31, 2018. We did not have such one-time interest expense in the current period.

During the three months ended March 31, 2019, we had a gain associated with the change in the fair value of our derivative liabilities of $58,360. During the previous year, we had a $702,785 loss in that category.

During the three months ended March 31, 2019, we had losses on conversions of promissory notes to common stock. These losses amounted to $120,775. We had no such losses during the previous year.

During the three months ended March 31, 2019, we had a foreign exchange loss of $5,865 versus a gain of $14,707 during the same period in 2018, all of which are currency translation effects resulting from exchange rate differences between the U.S. and Australian dollars.

Our net comprehensive losses of $282,995 and $1,575,450 during the three months ended March 31, 2019 and 2018 are a result of the above items.

Liquidity and Capital Resources

Our financial statements have been prepared on a going concern basis that contemplates the realization of assets and the settlement of liabilities and commitments in the normal course of business.

At March 31, 2019, the Company had $3,984 in cash and liabilities totaling $2,495,757. We are currently seeking financing to attain our business goals, but there is no guarantee that we will obtain such financing or, upon obtaining it, that we will be able to invest in productive assets that will result in positive cash flows from operations.

Going Concern

The accompanying financial statements have been prepared assuming that the Company will continue as a going concern. As shown in the accompanying financial statements, we had negative cash flows from operations, recurring losses, and negative working capital at March 31, 2019 and December 31, 2018. These conditions raise substantial doubt as to our ability to continue as a going concern. The financial statements do not include any adjustments that might be necessary if we are unable to continue as a going concern. Management intends to finance these deficits by making additional shareholder notes and seeking additional outside financing through either debt or sales of its common stock.

Plan of Operation

Our immediate term plans for operations is discussed extensively in Item 7 – Management’s Discussion and Analysis or Plan of Operation included in our Form 10-K as of December 31, 2018, filed with the Securities and Exchange Commission on April 16, 2019 and is herein incorporated by reference.

19

ITEM 3 - QUANTITIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

A smaller reporting company is not required to provide the information required by this item.

ITEM 4 - CONTROLS AND PROCEDURES

Evaluation of Disclosure Controls and Procedures.

We maintain "disclosure controls and procedures" as such term is defined in Rule 13a-15(e) under the Securities Exchange Act of 1934. In designing and evaluating our disclosure controls and procedures, our management recognized that disclosure controls and procedures, no matter how well conceived and operated, can provide only reasonable, not absolute, assurance that the objectives of disclosure controls and procedures are met. Additionally, in designing disclosure controls and procedures, our management necessarily was required to apply its judgment in evaluating the cost-benefit relationship of possible disclosure controls and procedures. The design of any disclosure controls and procedures also is based in part upon certain assumptions about the likelihood of future events, and there can be no assurance that any design will succeed in achieving its stated goals under all potential future conditions.

Based upon the evaluation of our officers and directors of our disclosure controls and procedures as of March 31, 2019, the end of the period covered by this Quarterly Report on Form 10-Q (the "Evaluation Date"), our Chief Executive Officer has concluded that as of the Evaluation Date that our disclosure controls and procedures were not effective such that the information relating to our company, required to be disclosed in our Securities and Exchange Commission reports (i) is recorded, processed, summarized and reported within the time periods specified in SEC rules and forms and (ii) is accumulated and communicated to our management, including our Chief Executive Officer, to allow timely decisions regarding required disclosure. Our management concluded that our disclosure controls and procedures were not effective as a result of material weaknesses in our internal control over financial reporting. We are a small organization with only a few employees. Under these circumstances it is impossible to completely segregate duties. We do not expect our internal controls to be effective until such time as we are able to begin full operations and even then there are no assurances that our disclosure controls will be adequate in future periods.

Change In Internal Control Over Financial Reporting

There were no changes in our internal control over financial reporting that occurred during the three months ended March 31, 2019 that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

20

PART II – OTHER INFORMATION

ITEM 1 – LEGAL PROCEEDINGS

We may be involved from time to time in ordinary litigation, negotiation and settlement matters that will not have a material effect on our operations or finances. We are not aware of any pending or threatened litigation against us, other than that described in Note 7, or our officers and directors in their capacity as such that could have a material impact on our operations or finances.

ITEM 1A – RISK FACTORS

We are a smaller reporting company as defined in Rule 12b-2 of the Exchange Act and are not required to provide the information required under this item.

ITEM 2 – UNREGISTERED SALE OF EQUITY SECURITIES

None

ITEM 3 – DEFAULTS UPON SENIOR SECURITIES

None

ITEM 4 – MINE SAFETY DISCLOSURES

Not applicable.

ITEM 5 – OTHER INFORMATION

None

ITEM 6 - EXHIBITS

Exhibit No.	Description of Exhibit
3.1	Articles of Incorporation, as filed June 5, 2007 (included as Exhibit 3.1 to the Form SB-2 filed April 5, 2007, and incorporated herein by reference).
3.2	Bylaws (included as Exhibit 3.2 to the Form SB-2 filed April 5, 2007, and incorporated herein by reference).
31.1	Certification of Chief Executive Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 (filed herewith).
32.1	Certification of Chief Executive Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 (filed herewith).

21

SIGNATURES

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

	Tautachrome, Inc
Date: May 22, 2019	By:	/s/ Dr. Jon Leonard
		Dr. Jon Leonard Chief Executive Officer

22

EX-31.1

EXHIBIT 31.1

CERTIFICATIONS

I, Dr. Jon Leonard, Chief Executive Officer of TAUTACHROME, INC. (the “Registrant”) certify that:

1.	I have reviewed the report being filed on Form 10-Q.
2.	Based on my knowledge, the report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by the report;
3.	Based on my knowledge, the financial statements, and other financial information included in the report, fairly present in all material respects the financial condition, results of operations and cash flows of TAUTACHROME, INC. as of, and for, the periods presented in the report;
4.	I am responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-a5(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-a5(f)) for the Registrant and have;

(a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure the material information relating to the Registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

(b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

(c) Evaluated the effectiveness of the Registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation.

(d) Disclosed in this report any change in the Registrant's internal control over financial reporting that occurred during the Registrant's most recent fiscal three months (the Registrant's fourth fiscal three months in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the Registrant's internal control over financial reporting; and;

5. I have disclosed, based on our most recent evaluation, to the Tautachrome auditors and the audit committee of the board of directors (or persons fulfilling the equivalent function):

i. All significant deficiencies in the design or operation of internal controls which could adversely affect Tautachrome’s ability to record, process, summarize and report financial data and have identified Tautachrome auditors any material weaknesses in internal controls; and

ii. Any fraud, whether or not material, that involves management or other employees who have a significant role in the issuer's internal controls; and

6. I have indicated in the report whether or not there were significant changes in internal controls or in other factors that could significantly affect internal controls subsequent to the date of our most recent evaluation, including any corrective actions with regard to significant deficiencies and material weaknesses.

Date: May 22, 2019	By:	/s/ Dr. Jon Leonard
		Dr. Jon Leonard
		Chief Executive Officer

EX-32.1

EXHIBIT 32.1

CERTIFICATION PURSUANT TO 18 U.S.C. SECTION 1350,

AS ADOPTED PURSUANT TO

SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

In connection with the Quarterly Report of TAUTACHROME, INC. (the "Company") on Form 10-Q as filed with the Securities and Exchange Commission on the date hereof (the "Report'), I, Dr. Jon Leonard, Chief Executive Officer of the Company, certify, pursuant to 18 USC section 1350, as adopted pursuant to section 906 of the Sarbanes-Oxley Act of 2002, that to the best of my knowledge and belief:

(1)	The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and
(2)	The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

Date: May 22, 2019	By:	/s/ Dr. Jon Leonard
		Dr. Jon Leonard
		Chief Executive Officer

XML

Document and Entity Information - shares	3 Months Ended
	Mar. 31, 2019	May 10, 2019
Document And Entity Information
Entity Registrant Name	TAUTACHROME INC.
Entity Central Index Key	0001389067
Document Type	10-Q
Document Period End Date	Mar. 31, 2019
Amendment Flag	false
Current Fiscal Year End Date	--12-31
Is Entity's Reporting Status Current?	Yes
Entity Filer Category	Non-accelerated Filer
Entity Common Stock, Shares Outstanding		33,731,369,99.
Document Fiscal Period Focus	Q1
Document Fiscal Year Focus	2019
Entity Small Business	true
Entity Emerging Growth Company	false
Entity Ex-Transition Period	false

XML

CONSOLIDATED BALANCE SHEETS - USD ($)	Mar. 31, 2019	Dec. 31, 2018
Current assets:
Cash	$ 3,984	$ 6,243
Total current assets	3,984	6,243
TOTAL ASSETS	3,984	6,243
LIABILITIES
Accounts payable and accrued expenses	649,388	615,847
Accounts payable - related party	114,148	114,052
Loans from related parties	103,203	103,074
Convertible notes payable - related party	88,152	81,340
Short-term convertible notes payable, net	641,822	627,928
Convertible notes payable in default	267,056	422,565
Short-term notes payable	15,612	15,501
Derivative liability	162,669	365,497
Court judgment liability	250,000	250,000
Total current liabilities	2,292,050	2,595,804
Long-term convertible notes payable, net	70,882	25,000
Long-term convertible notes payable – related party, net	32,825	32,825
Crypto-currency notes payable	100,000	100,000
Total non-current liabilities	203,707	157,825
TOTAL LIABILITIES	2,495,757	2,753,629
STOCKHOLDERS' EQUITY (DEFICIT)
Series D Convertible Preferred, par value $0.0001. 13,795,104 shares authorized, 13,795,104 shares issued and outstanding at March 31, 2019 and December 31, 2018	1,380	1,380
Common stock, $0.00001 par value. Six billion shares authorized. 2,871,747,062 and 1,932,483,910 shares issued and outstanding at March 31, 2019 and December 31, 2018, respectively	28,717	19,325
Additional paid in capital	5,221,825	4,692,609
Common stock payable	1,919,927	1,919,927
Accumulated deficit	(9,753,959)	(9,476,829)
Effect of foreign currency exchange	90,337	96,202
TOTAL STOCKHOLDERS'’ EQUITY	(2,491,773)	(2,747,386)
TOTAL LIABILITIES AND STOCKHOLDERS'’ EQUITY	$ 3,984	$ 6,243

XML

CONSOLIDATED BALANCE SHEETS (Parenthetical) - $ / shares	Mar. 31, 2019	Dec. 31, 2018
STOCKHOLDERS’ EQUITY (DEFICIT)
Series D Convertible preferred stock par value	$ 0.0001	$ 0.0001
Series D Convertible preferred stock shares authorized	13,795,104	13,795,104
Series D Convertible preferred stock shares issued	13,795,104	13,795,104
Series D Convertible preferred stock shares outstanding	13,795,104	13,795,104
Common stock, par value	$ 0.00001	$ 0.00001
Common stock, shares authorized	6,000,000,000	6,000,000,000
Common stock, shares issued	2,871,747,062	1,932,483,910
Common stock, shares outstanding	2,871,747,062	1,932,483,910

XML

CONSOLIDATED STATEMENTS OF OPERATIONS (Unaudited) - USD ($)	3 Months Ended
	Mar. 31, 2019	Mar. 31, 2018
OPERATING EXPENSES
General and administrative	$ 130,220	$ 307,425
Total operating expenses	130,220	307,425
Operating loss	(130,220)	(307,425)
OTHER INCOME / (EXPENSE)
Gain on settlement of debt	1,330
Interest expense	(85,825)	(579,947)
Change in value of derivatives	58,360	(702,785)
Loss on conversion of debt	(120,775)
Total other	(146,910)	(1,282,732)
Net loss	(277,130)	(1,590,157)
OTHER COMPREHENSIVE INCOME (LOSS)
Effect of foreign currency exchange	(5,865)	14,707
Net comprehensive income or (loss)	$ (282,995)	$ (1,575,450)
Net (loss) or income per common share, basic and diluted	$ 0.00	$ 0.00
Weighted average shares outstanding, basic and diluted	2,300,781,103	1,696,249,730

XML

CONSOLIDATED STATEMENT OF STOCKHOLDERS' EQUITY / (DEFICIT) (Unaudited) - USD ($)	Common Stock	Preferred Stock Series D	Additional Paid-in Capital	Stock Payable	Other Comprehensive Income (Loss)	Accumulated Deficit	Total
Beginning Balance, Shares at Dec. 31, 2017	1,685,941,636	13,795,104
Beginning Balance, Amount at Dec. 31, 2017	$ 16,860	$ 1,380	$ 3,787,675	$ 23,186	$ 15,540	$ (5,293,041)	$ (1,448,400)
Shares issued with convertible note payable, Shares	15,000,000
Shares issued with convertible note payable, Amount	$ 150		127,350				127,500
Preferred Series E shares accrued to ArKnet				1,837,000			1,837,000
Shares issued for conversion of debt, Shares	221,542,274
Shares issued for conversion of debt, Amount	$ 2,215		373,414				375,629
Shares issued to settle lawsuit, Shares	10,000,000
Shares issued to settle lawsuit, Amount	$ 100		59,900				60,000
Derivative associated with early debt retirement			326,339				326,339
Shares earned by consultants				59,741			59,741
Imputed interest			17,931				17,931
Effect of foreign currency exchange					80,662		80,662
Net loss						(4,183,788)	(4,183,788)
Ending Balance, Shares at Dec. 31, 2018	1,932,483,910	13,795,104
Ending Balance, Amount at Dec. 31, 2018	$ 19,325	$ 1,380	4,692,609	1,919,927	96,202	(9,476,829)	(2,747,386)
Shares issued for conversion of debt, Shares	935,640,097
Shares issued for conversion of debt, Amount	$ 9,356		345,841				355,197
Derivative associated with early debt retirement			175,780				175,780
Imputed interest			4,008				4,008
Effect of foreign currency exchange					(5,865)		(5,865)
Shares issued to settle claim, Shares	3,623,055
Shares issued to settle claim, Amount	$ 36		3,587				3,623
Net loss						(277,130)	(277,130)
Ending Balance, Shares at Mar. 31, 2019	2,871,747,062	13,795,104
Ending Balance, Amount at Mar. 31, 2019	$ 28,717	$ 1,380	$ 5,221,825	$ 1,919,927	$ 90,337	$ (9,753,959)	$ (2,491,773)

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CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited) - USD ($)	3 Months Ended
	Mar. 31, 2019	Mar. 31, 2018
CASH FLOWS FROM OPERATING ACTIVITIES
Net Loss	$ (277,130)	$ (1,590,157)
Stock-based compensation		21,420
Loss on conversions	120,775
Change in fair value of derivative	(58,360)	702,785
Gains on debt settlements	(1,330)
Amortization of discounts on notes payable	48,934	534,430
Imputed interest	4,008	4,750
Changes in operating assets and liabilities:
Accounts payable and accrued expenses	54,422	25,384
Accounts payable - related party
Net cash used in operating activities	(108,681)	(301,388)
CASH FLOWS FROM FINANCING ACTIVITIES
Proceeds from convertible notes payable	105,475	593,000
Principal payments on notes payable		(97,150)
Proceeds from related-party loans	18,000	1,830
Principal payments on related-party loans	(11,188)
Net cash provided by financing activities	112,287	497,680
Effect of exchange rate changes on cash and cash equivalents	(5,865)	14,707
Net increase/(decrease) in cash	(2,259)	210,999
Cash and equivalents - beginning of period	6,243	9,726
Cash and equivalents - end of period	3,984	220,725
SUPPLEMENTARY INFORMATION
Cash paid for interest		2,720
Cash paid for income taxes
SUPPLEMENTAL DISCLOSURES OF NON-CASH FINANCING TRANSACTIONS
Discounts on convertible notes	31,312	664,688
Conversion of debt to common stock	234,422	11,155
Settlement of derivative liability	175,780	93,280
Shares issued for debt settlement	$ 3,623

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Organization and Nature of Business

3 Months Ended

Mar. 31, 2019

Notes to Financial Statements

Note 1 - Organization and Nature of Business

History

Tautachrome, Inc. was formed in Delaware on June 5, 2006 as Caddystats, Inc. and hereinafter collectively referred to as “Tautachrome”, the “Company”, “we’ or “us”).

The Company adopted the accounting acquirer’s year end, December 31.

Our Business

Tautachrome operates in the internet applications space, a large space we believe to be uniquely able to make possible fast growing and novel business. The iPhone, Google, Facebook, Amazon, Uber and numerous other examples are reminders of the ability of the internet applications space to surprise us with new business universes out of nowhere. A recent surprise was the arrival in the internet applications space of blockchain technology, which is empowering enterprises of all sizes to create ecosystems of trade based on self-introduced and globally useable cryptocurrencies. The arrival of blockchain technology has added a significant new and leading element to Tautachrome’s business plans and activities. The subsequent development of a new patent pending technology dubbed ArK technology that exploits augmented reality in a new solution to the purchasing interaction between global consumers and providers is a brand new surprise, and has been licensed by the Company for development.

Tautachrome is currently pursuing three main avenues of business activity based on our patented activated imaging technology, our blockchain cryptocurrency products, and the ArK patent pending technology (together banded “KlickZie” technology):

1.	KlickZie ArK technology business: The Company has licensed and is developing a new KlickZie augmented reality (often abbreviated AR) technology called “ArK technology which permits goods and services providers to establish geolocated augmented reality interfaces, called ArKs, allowing consumers to interact with inside info on the provider’s products, specials and discounts with live purchasing provided. A provider’s ArK may be located anywhere on earth, at a store location, or anywhere else the provider may desire. The ArKnet is a fintech platform connecting consumers to providers in the global $48 trillion household purchasing market, using augmented reality as the medium of interaction.
2.	KlickZie’s blockchain cryptocurrency based ecosystem: our recently added activity to create our own KlickZie blockchain and cryptocurrency to incentivize user download of KlickZie products and to provide a crypto based monetary stream to the Company, and
3.	KlickZie Activated Digital Imagery business: our longstanding flagship activity to develop and monetize downloadable apps based on our patented KlickZie trusted imaging technology and based on our patented trusted image-based social interactions using the pictures and videos that smartphone users generate on the web using their KlickZie imaging app.

Since its public announcement on September 25, 2017 (via SEC form 8-K) that it would be using its Twitter site (@Tautachrome_Inc) (http://twitter.com/tautachrome_inc) to post important Company information, and finding this method of publicizing important Company information both fast and effective, the Company has continued to use this means of public communication almost exclusively, supplemented only occasionally with Current Reports via SEC form 8-Ks. Shareholders are advised to follow us on Twitter to be current on the Company’s FD disclosures.

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Basis of Presentation and Summary of Significant Accounting Policies

3 Months Ended

Mar. 31, 2019

Notes to Financial Statements

Note 2 - Basis of Presentation and Summary of Significant Accounting Policies

Consolidated Financial Statements

In the opinion of management, the accompanying financial statements includes all adjustments (which include only normal recurring adjustments) necessary to present fairly the financial position, results of operations, and cash flows for the period ending March 31, 2019. Preparing financial statements requires management to make estimates and assumptions that affect the reported amounts of assets, liabilities, revenue, and expenses. Interim results are not necessarily indicative of results for a full year. The information included in this Form 10-Q should be read in conjunction with information included in our audited financial statements for the period ended December 31, 2018 (as amended), as reported in Form 10-K filed with the Securities and Exchange Commission.

Management further acknowledges that it is solely responsible for adopting sound accounting practices, establishing and maintaining a system of internal accounting control and preventing and detecting fraud. The Company's system of internal accounting control is designed to assure, among other items, that 1) recorded transactions are valid; 2) valid transactions are recorded; and 3) transactions are recorded in the proper period in a timely manner to produce financial statements which present fairly the financial condition, results of operations and cash flows of the Company for the respective periods being presented.

Principles of Consolidation

Our consolidated financial statements include the accounts of Tautachrome, Inc. and all majority-owned subsidiaries. All significant inter-company accounts and transactions are eliminated in consolidation.

Long-Lived Assets, Intangible Assets and Impairment

In accordance with U.S. GAAP, the Company’s long-lived assets and amortizable intangible assets are tested for impairment whenever events or changes in circumstances indicate that their carrying value may not be recoverable. The Company assesses the recoverability of such assets by determining whether their carrying value can be recovered through undiscounted future operating cash flows, including its estimates of revenue driven by assumed market segment share and estimated costs. If impairment is indicated, the Company measures the amount of such impairment by comparing the fair value to the carrying value.

Use of Estimates

The preparation of financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates.

Net Loss Per Share

Basic and diluted net loss per share calculations are calculated on the basis of the weighted average number of common shares outstanding during the year. The per share amounts include the dilutive effect of common stock equivalents in years with net income. Basic and diluted loss per share is the same for the three months ended March 31, 2019 as the effect of our potential common stock equivalents would be anti-dilutive.

Recent Accounting Pronouncements

In February 2016, the FASB established Topic 842, Leases, by issuing Accounting Standards Update (ASU) No. 2016-02, which requires lessees to recognize leases on-balance sheet and disclose key information about leasing arrangements. The new standard establishes a right-of-use model (ROU) that requires a lessee to recognize a ROU asset and lease liability on the balance sheet for all leases with a term longer than 12 months. Leases will be classified as finance or operating, with classification affecting the pattern and classification of expense recognition in the income statement.

The new standard was effective for us on January 1, 2019 and we have adopted it. A modified retrospective transition approach is required, applying the new standard to all leases existing at the date of initial application. An entity may choose to use either (1) its effective date or (2) the beginning of the earliest comparative period presented in the financial statements as its date of initial application. If an entity chooses the second option, the transition requirements for existing leases also apply to leases entered into between the date of initial application and the effective date. The entity must also recast its comparative period financial statements and provide the disclosures required by the new standard for the comparative periods. We expect to adopt the new standard on January 1, 2019 and use the effective date as our date of initial application. Consequently, financial information will not be updated and the disclosures required under the new standard will not be provided for dates and periods before January 1, 2019. The Company does not expect the adoption of this ASU to have a material impact on its consolidated financial statements as the Company has no leases whose term is greater than one year.

In February 2018, the FASB issued ASU No. 2018-02, Reclassification of Certain Tax Effects from Accumulated Other Comprehensive Income . The guidance permits entities to reclassify tax effects stranded in Accumulated Other Comprehensive Income as a result of tax reform to retained earnings. This new guidance is effective for annual and interim periods in fiscal years beginning after December 15, 2018. Early adoption is permitted in annual and interim periods and can be applied retrospectively or in the period of adoption. The Company is currently in the process of evaluating the impact of adoption on its consolidated financial statements.

In March 2018, the FASB issued ASU No. 2018-05, Income Taxes (Topic 740) - Amendments to SEC Paragraphs Pursuant to SEC Staff Accounting Bulletin No. 118. The amendment provides guidance on accounting for the impact of the Tax Cuts and Jobs Act (the “Tax Act”) and allows entities to complete the accounting under ASC 740 within a one-year measurement period from the Tax Act enactment date. This standard is effective upon issuance. The Tax Act has several significant changes that impact all taxpayers, including a transition tax, which is a one-time tax charge on accumulated, undistributed foreign earnings. The calculation of accumulated foreign earnings requires an analysis of each foreign entity’s financial results going back to 1986. The Company does not expect the adoption of this ASU to have a material impact on its consolidated financial statements.

In June 2018, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) 2018-07, Compensation-Stock Compensation (Topic 718): Improvements to Nonemployee Share-Based Payment Accounting , which expands the scope of Topic 718 to include share-based payment transactions for acquiring goods and services from nonemployees. An entity should apply the requirements of Topic 718 to nonemployee awards except for specific guidance on inputs to an option pricing model and the attribution of cost (that is, the period of time over which share-based payment awards vest and the pattern of cost recognition over that period). The new guidance is effective for all entities for annual periods, and interim periods within those annual periods, beginning after December 15, 2017, with early adoption permitted. The Company does not expect the adoption of this ASU to have a material impact on its consolidated financial statements.

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Going Concern

3 Months Ended

Mar. 31, 2019

Notes to Financial Statements

Note 3 - Going Concern

We have not begun our core operations in the technology industry and have not yet acquired the assets to enter this markets and we will require additional capital to do so. There is no guarantee that we will acquire the capital to procure the assets to enter this market or, upon doing so, that we will generate positive cash flows from operations. Substantial doubt exists as to Tautachrome’s ability to continue as a going concern. No adjustment has been made to these financial statements for the outcome of this uncertainty.

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Related Party Transactions

3 Months Ended

Mar. 31, 2019

Notes to Financial Statements

Note 4 - Related Party Transactions

For the three months ended March 31, 2019, we accrued $1,213 of interest to the 22nd Trust (the “Trust”), the trustee of whom is Sonny Nugent, the son of our major shareholder and former Chief Executive Officer, Micheal Nugent. The outstanding balances of unpaid principal and interest at March 31, 2019 and December 31, 2018 were $119,947 and $118,591, respectively.

According to our agreement with Mr. Nugent, we accrue interest on all unpaid amounts at 5%. Principal and interest are callable at any time. If principal and interest are called and not repaid, the loan is considered in default after which interest is accrued at 10%.

Convertible note payable, related party

On May 5, 2013 (and on August 8, 2013 with an enlargement amendment) the Company entered into a no interest demand-loan agreement with our current Chairman, Jon N. Leonard under which the Company may borrow such money from Jon as Jon in his sole discretion is willing to loan.

The terms of the note provide that at the Company’s option, the Company may make repayments in stock, at a fixed share price of $1.00 per share. Also, because this loan is a no-interest loan, an imputed interest expense of $1,520 was recorded as additional paid-in capital for the three months ended March 31, 2019. The Company evaluated Dr. Leonard’s note for the existence of a beneficial conversion feature and determined that none existed.

During the three months ended March 31, 2019, we repaid Dr. Leonard $11,188 and borrowed an additional $18,000.

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Capital

3 Months Ended

Mar. 31, 2019

Notes to Financial Statements

Note 5 - Capital

During the year ended December 31, 2018 we issued 246,542,274 shares as follows:

• We settled our lawsuit with Richard Morgan in full by issuing 10 million shares. We valued the shares at their grant date fair values, removing the judgment liability of $5,000 and recording a $55,000 loss on litigation.

• We issued 15,000,000 shares as an equity incentive to a creditor. We valued the shares at their grant-date fair values and recorded a discount on that debt of $127,500.

• We issued 221,542,274 shares in conversion of outstanding convertible promissory notes. We recorded a reduction of the balance of these notes of $306,623 and $27,728 of principal and interest, respectively and recorded a loss on conversion of $41,278. As part of these conversions, we retired $326,339 of associated derivative liabilities which we included in Additional Paid in Capital.

During the three months ended March 31, 2019, we issued 939,263,152 shares as follows:

• We issued 935,640,097 shares in conversion of outstanding convertible promissory notes. We recorded a reduction of the balance of these notes of $218,508 of principal, $11,914 of interest, and $4,000 of conversion fees and recorded a loss on conversion of $120,775. As part of these conversions, we retired $175,780 of associated derivative liabilities which we included in Additional Paid in Capital.

• We issued 3,623,055 to a certain Australian individual who made baseless claims against the Company other than two existing convertible promissory notes which the Company acknowledged. Rather than engage in a prolonged international legal matter, we issued these shares in complete satisfaction of any and all claims against the Company. We valued the shares at their grant date fair values, reduced unpaid principal and interest in the amount of $4,258 and $695, respectively, and recorded a $1,330 gain on this settlement.

Preferred Stock

During the year ended December 31, 2018, we accrued $1,837,000 in costs related to the 40,000 Series E Preferred shares promised in our ArKnet contract (see Note 4) containing a par value of $0.0001. This series of preferred shares have the following rights, limitations, restrictions and privileges:

• They are not entitled to dividends,

• They are entitled to no liquidations rights,

• Each share has the voting rights of all other voting shares combined, multiplied by 0.00001,

• They have no conversion or redemption rights.

These shares were issued subsequent to the March 31, 2019 balance sheet and are included in stock payable at that date.

Imputed Interest

Certain of our promissory notes bear no nominal interest. We therefore imputed interest expense and increase Additional Paid in Capital. For the three months ended March 31, 2019, we imputed $4,008 of such interest.

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Debt

3 Months Ended

Mar. 31, 2019

Notes to Financial Statements

Note 6 - Debt

Loans from related parties

As is discussed in Note 4, at March 31, 2019 we owed $208,099 in related-party debts consisting of $98,203 and $21,744 in unpaid principal and interest, respectively, to the 22^nd Trust and $88,152 owed to our CEO, Dr. Jon Leonard.

Convertible notes payable

During the year ended December 31, 2018, we issued eight new convertible promissory notes in the amount of $633,000, containing original issue discounts totaling $71,688, for net proceeds of $561,313). These convertible notes can convert to common stock at various different prices. We evaluated these convertible notes for beneficial conversion features and calculated a collective value of $209,040 which we are accounting for as debt discounts. The individual notes are discussed in Note 6 to the financial statements filed on Form 10-K for the year ended December 31, 2018 and are hereby incorporated by reference.

During the three months ended March 31, 2019 we issued three convertible promissory notes in the aggregate amount of $105,475, receiving proceeds therefrom of the same amount. These convertible notes can convert to common stock at various prices. We evaluated these convertible notes for beneficial conversion features and calculated a collective value of $31,312 which we are accounting for as debt discounts. These three convertible notes are discussed below:

• On January 11, 2019, we issued a convertible note in the amount of $100,000 which accrues interest at 5% (10% for unpaid interest and principal after maturity) and matures on July 8, 2020. This note can convert to 83,333,333 shares.

• On January 23, 2019, we issued a convertible note in the amount of $1,475 which accrues interest at 5% (10% for unpaid interest and principal after maturity) and matures on July 23, 2020. This note can convert to 1,109,023 shares.

• On January 16, 2019, we issued a convertible note in the amount of $4,000 which accrues interest at 5% (10% for unpaid interest and principal after maturity) and matures on July 16, 2020. This note can convert to 3,007,519 shares.

During the three months ended March 31, 2019, we issued 3,623,055 to a certain Australian individual who made baseless claims against the Company other than two existing convertible promissory notes which the Company acknowledged. Rather than engage in a prolonged international legal matter, we issued these shares in complete satisfaction of any and all claims against the Company. We valued the shares at their grant date fair values, reduced unpaid principal and interest in the amount of $4,258 and $695, respectively, and recorded a $1,330 gain on this settlement.

During the three months ended March 31, 2019, we amortized $48,934 of debt discounts to interest expense and accrued $29,224 of interest on existing notes.

At March 31, 2019, $267,056 of our convertible notes payable were in default.

Convertible notes payable (excluding related-party convertible notes which is discussed in Note 4) at March 31, 2019 and December 31, 2018 and their classification into long-term, short-term and in-default were as follows:

	03/31/19			12/31/18
All convertible promissory notes
Unpaid principal		1,007,889			1,121,243
Discounts		(28,129	)		(45,750	)
Convertible notes payable, net	$	979,760		$	1,075,493
Classified as short-term
Unpaid principal balance		642,182			673,678
Discounts		(360	)		(45,750	)
Convertible notes payable - short-term, net	$	641,822		$	627,928
Classified as long-term
Unpaid principal balance		98,651			25,000
Discounts		(27,769	)		-
Convertible notes payable - short-term, net	$	70,882		$	25,000
Classified as in default
Unpaid principal balance		267,056			422,565
Discounts		-			-
Convertible notes payable - short-term, net	$	267,056		$	422,565

Crypto-currency notes payable

On August 7, 2018, we issued a Crypto Exchange Promissory Note (“the Crypto Note”) in exchange for $100,000 in cash. The Crypto Note accrues interest at 4% until maturity which is 18 months from issue and 10% after maturity. The holder can convert unpaid principal and accrued interest into KLK20 tokens at any time at the rate of $0.25 per token. The holder may, for up to nine months after issuance, participate in a price guarantee: if the Company offers the tokens at less than $0.25 per token at any point for up to nine months after issuance, then the holder has the option of participating in the offer at the lower price.

Derivative liabilities

The above-referenced convertible promissory notes issued during the three months ended March 31, 2019 were analyzed in accordance with EITF 07–05 and ASC 815. EITF 07–5, which is effective for fiscal years beginning after December 15, 2009, and interim periods within those fiscal years. The objective of EITF 07–5 is to provide guidance for determining whether an equity–linked financial instrument is indexed to an entity’s own stock. This determination is needed for a scope exception under Paragraph 11(a) of ASC 815 which would enable a derivative instrument to be accounted for under the accrual method. The classification of a non–derivative instrument that falls within the scope of EITF 00–19 “Accounting for Derivative Financial Instruments Indexed to, and Potentially Settled in, a Company’s Own Stock” also hinges on whether the instrument is indexed to an entity’s own stock. A non–derivative instrument that is not indexed to an entity’s own stock cannot be classified as equity and must be accounted for as a liability. The EITF reached a consensus that would establish a two–step approach in determining whether an instrument or embedded feature is indexed to an entity’s own stock. First, the instrument's contingent exercise provisions, if any, must be evaluated, followed by an evaluation of the instrument's settlement provisions.

Derivative financial instruments should be recorded as liabilities in the consolidated balance sheet and measured at fair value. For purposes of this engagement and report, we utilized fair value as the basis for formulating our opinion which has been defined by the Financial Accounting Standards Board (“FASB”) as “the amount for which an asset (or liability) could be exchanged in a current transaction between knowledgeable, unrelated willing parties when neither party is acting under compulsion”. The FASB has provided guidance that its definition of fair value is consistent with the definition of fair market value in IRS Rev. Rule 59–60.

The Company issued Subscription Notes from 2015 through March 31, 2019 in the United States and Australia which are convertible at discounted market rates and market prices based on the average of 5 trading day closing bids. The notes are convertible after 1 year from issuance; mature in 18 months from issuance; accrued at 5% interest; and a 10% default rate. These convertible notes have become tainted (“The Tainted Notes) as a result of the issuance of convertible promissory notes issued in the United States since there is a possibility (however remote) that the Company would not have enough shares in the Treasury to satisfy all possible conversions.

The Convertible Note derivatives were valued as of issuance; conversion; redemption/settlement; and each quarterly period from March 31, 2018 through March 31, 2019. The following assumptions were used for the valuation of the derivative liability related to the Notes:

• The stock price of $0.0013 to $0.0005 in this period would fluctuate with the Company projected volatility.

• The notes convert with variable conversion prices based on the percentages of the low or average trades or bids over 20 to 25 trading days.

• The effective discounts rates estimated throughout the periods range from 35% to 42% with potentially an additional discount.

• The Holder would automatically convert the note before maturity if the registration was effective and the company was not in default.

• The projected annual volatility for each valuation period was based on the historic volatility of the company are 157.8 – 296.0% (annualized over the term remaining for each valuation).

• An event of default would occur 0% of the time, increasing 1.00% per month to a maximum of 20%.

• The Holders would redeem the notes (with penalties up to 50% depending on the date and full–partial redemption) based on availability of alternative financing of 0% of the time, increasing 1.00% per month to a maximum of 5%.

• The Holder would automatically convert the note at the maximum of 2 times the conversion price or the stock price on the date of valuation.

• The Holder would automatically convert the note based on ownership or trading volume limitations.

We recorded the initial derivative as both a derivative liability and a debt discount (or initial reduction in carrying value of the debt). We then amortized the debt discounts using the Effective Interest Method which recognizes the cost of borrowing at a constant interest rate throughout the contractual term of the obligation. The effective interest rates on the six instruments issued during the year ended December 31, 2018 range from 243% to 289%.

At each reporting date, we determine the fair market value for each derivative associated with each of the above instruments. At March 31, 2019, we determined the fair value of these derivatives were $162,668.

Changes in outstanding derivative liabilities are as follows:

Balance, December 31, 2018	$	365,497
Changes due to new issuances		31,312
Changes due to extinguishments		(175,780	)
Changes due to adjustment to fair value		(58,360	)
Balance, March 31, 2019	$	162,669

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Litigation

3 Months Ended

Mar. 31, 2019

Notes to Financial Statements

Note 7 - Litigation

Morgan Lawsuit

Background

The May 21, 2015 merger of the Company with Click Evidence, Inc. (“Click”) resulted in the transfer of Click’s assets and interests from Click to the Company and in Click becoming an asset-less entity inside the Company and then being disposed of on November 25, 2015. In the November 25, 2015 conveyance of the Click to the new owner, its name was changed to BH Trucking, Inc. (“BH”).

Filing and service

A first lawsuit was filed in the Superior Court of the State of Arizona, Pima County, by a former consultant to Click, Richard Morgan (“Morgan”). This lawsuit was served on December 2, 2015, against Click/BH, with the Company also named in the lawsuit, but not served by it or effectively made aware of it until 2017.

Allegation

The lawsuit claimed that the consultant’s agreement with Click/BH permitted him to recover a finder’s fee for the cashless stock swap that achieved the merger on May 21, 2015. The new owner of Click/BH, the only party served, declined to defend the lawsuit allowing it to go to default.

Default judgment

On December 16, 2016, the Court issued a default judgment for the plaintiff and against the defendants in the amount of $2,377,915. The Company believes that having not been served or made aware of the lawsuit, it is not a target of the judgment.

Second Lawsuit

On January 23, 2017, the Company and its CEO were served in a second lawsuit by Morgan alleging that the Company’s intellectual property assets that were transferred to it by Click under the May 21, 2015 merger of the Company with Click, were fraudulently removed from Click/BH, and seeks to have them returned to Click/BH.

Effect on the Financial Statements

During the three months ended September 30, 2017 we included in liabilities the default amount of $2,377,915 plus $4,459 interest at 4.5% from December 16, 2016, the date of the judgment, to December 31, 2016.

On August 29, 2017, the Court set aside the judgment in the First Lawsuit resulting in the removal of the liability of $2,377,915 and accrued interest of $4,459 at December 31, 2016, as well as the additional accrued interest recorded during 2017 of $44,294, for a total gain of $2,426,668.

On August 14, 2018, we settled this lawsuit in full by issuing 10 million shares. We valued the shares at their grant date fair values, removing the judgment liability of $5,000 and recording a $55,000 loss on litigation.

McRae Lawsuit

On October 10, 2017, the Company received a letter from the lawyer of Eric L McRae (“McRae”) a person whose association with the Company was terminated by the Company on June 16, 2017. The letter demanded payment of 850 million unrestricted Tautachrome common shares to forestall his filing a laundry list of complaints in a variety of government agencies including with the US District Court in Kansas with complaints of contract breaches and fraud by silence, with the EEOC with complaints of termination by racial discrimination, with the OSHA with complains of termination for reasons of his being a whistleblower under Sarbanes-Oxley provisions, and with various regulatory agencies with accusations of an unspecified nature.

On October 12, 2017, McRae filed a complaint, later amended twice, against the Company in the US District Court in Kansas. The amended complaint alleges 1) that the Company breached a written agreement in an alleged employment by failing to pay him 35 million shares of the Company’s common stock and terminating his association with the Company on June 16, 2017 without proper notice. The complaint goes on to allege 2) that the Company committed fraud by silence for failing to inform him of an intent to receive the benefit of his services while harboring an intent to not compensate him, 3) that the Company breached an unwritten agreement with him to provide him with 185 million shares of the Company’s common stock, and 4) that the Company breached a convertible promissory note by failing and refusing to repay him the principal and accrued interest thereunder. Complaint number 4 is now moot in the belief of the Company since after the lawsuit was filed the Company continued to repay McRae’s convertible promissory note on schedule with interest due until paid in full on October 1, 2018, thus extinguishing the note and making the matter moot. These matters remain before the Court.

On December 12, 2017, McRae brought the Company before the Kansas Human Rights Commission and the U.S. Equal Employment Opportunity Commission (EEOC) alleging that on June 16, 2017 he was terminated from an alleged employment by the Company on the basis of race and for retaliation, and that the Company discriminated against him in the terms of this alleged employment because of race. The Company, knowing that all of McRae’s allegations before the EEOC are completely false, responded to the threatened complaint denying each of McRae’s allegations and providing its own presentation of the facts. The matter is presently stayed pending a claim for mediation by McRae who has so far failed to file a claim. Although the Company remains confident that should an investigation in this matter continue, it will fully prevail. We do not know when or if such an investigation will materialize.

On December 8, 2017, McRae filed a complaint with the Occupational Safety and Health Administration (the “OSHA”), alleging that his “investigation and reporting” to the Company’s CEO was a contributing factor in the termination of his alleged employment by the Company in violation of the Sarbanes-Oxley Act whistleblower’s provisions. On January 2, 2018, the Company delivered its response to the complaint, denying each of McRae’s allegations and providing its own presentation of the facts. McRae dismissed the OSHA claim with prejudice, and the matter cannot be brought again.

On October 17, 2018, we offered McRae 50 million shares in settlement of all outstanding legal actions against us. McRae declined the offer. However, we re-evaluated the liability on these lawsuits from $49,000 to $250,000 based on the closing price of our common stock on the date of the offer. We recognized a loss on litigation of $201,000 in so doing during 2018.

The Company, believing that allegations made by McRae are largely fabricated and aimed at doing harm, has been vigorously defending itself and believes it will prevail in every instance. Despite this belief, to save legal expense the Company made a good faith settlement offer to McRae. The offer was rejected.

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Income Taxes

3 Months Ended

Mar. 31, 2019

Notes to Financial Statements

Note 8 - Income Taxes

Deferred income taxes reflect the tax consequences on future years of differences between the tax bases:

	03/31/19			12/31/18
Net operating loss carry-forward		3,662,833			3,380,285
Deferred tax asset at 21%	$	769,195		$	709,860
Valuation allowance		(769,195	)		(709,860	)
Net future income taxes	$	-		$	-

In assessing the realizability of future tax assets, management considers whether it is more likely than not that some portion or all of the future tax assets will not be realized. The ultimate realization of future tax assets is dependent upon the generation of future taxable income during the periods in which those temporary differences become deductible. Management considers the scheduled reversal of future tax liabilities, projected future taxable income and tax planning strategies in making this assessment. Management has provided for a valuation allowance on all of its losses as there is no assurance that future tax benefits will be realized.

Our tax loss carry-forwards will begin to expire in 2030.

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Subsequent Events

3 Months Ended

Mar. 31, 2019

Notes to Financial Statements

Note 9 - Subsequent Events

We issued 501,389,937 shares in conversion of debt.

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Basis of Presentation and Summary of Significant Accounting Policies (Policies)

3 Months Ended

Mar. 31, 2019

Basis Of Presentation And Summary Of Significant Accounting Policies Policies

Consolidated Financial Statements

In the opinion of management, the accompanying financial statements includes all adjustments (which include only normal recurring adjustments) necessary to present fairly the financial position, results of operations, and cash flows for the period ending March 31, 2019. Preparing financial statements requires management to make estimates and assumptions that affect the reported amounts of assets, liabilities, revenue, and expenses. Interim results are not necessarily indicative of results for a full year. The information included in this Form 10-Q should be read in conjunction with information included in our audited financial statements for the period ended December 31, 2018 (as amended), as reported in Form 10-K filed with the Securities and Exchange Commission.

Management further acknowledges that it is solely responsible for adopting sound accounting practices, establishing and maintaining a system of internal accounting control and preventing and detecting fraud. The Company's system of internal accounting control is designed to assure, among other items, that 1) recorded transactions are valid; 2) valid transactions are recorded; and 3) transactions are recorded in the proper period in a timely manner to produce financial statements which present fairly the financial condition, results of operations and cash flows of the Company for the respective periods being presented.

Principles of Consolidation

Our consolidated financial statements include the accounts of Tautachrome, Inc. and all majority-owned subsidiaries. All significant inter-company accounts and transactions are eliminated in consolidation.

Long-Lived Assets, Intangible Assets and Impairment

In accordance with U.S. GAAP, the Company’s long-lived assets and amortizable intangible assets are tested for impairment whenever events or changes in circumstances indicate that their carrying value may not be recoverable. The Company assesses the recoverability of such assets by determining whether their carrying value can be recovered through undiscounted future operating cash flows, including its estimates of revenue driven by assumed market segment share and estimated costs. If impairment is indicated, the Company measures the amount of such impairment by comparing the fair value to the carrying value.

Use of Estimates

The preparation of financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates.

Net Loss Per Share

Basic and diluted net loss per share calculations are calculated on the basis of the weighted average number of common shares outstanding during the year. The per share amounts include the dilutive effect of common stock equivalents in years with net income. Basic and diluted loss per share is the same for the three months ended March 31, 2019 as the effect of our potential common stock equivalents would be anti-dilutive.

Recent Accounting Pronouncements

In February 2016, the FASB established Topic 842, Leases, by issuing Accounting Standards Update (ASU) No. 2016-02, which requires lessees to recognize leases on-balance sheet and disclose key information about leasing arrangements. The new standard establishes a right-of-use model (ROU) that requires a lessee to recognize a ROU asset and lease liability on the balance sheet for all leases with a term longer than 12 months. Leases will be classified as finance or operating, with classification affecting the pattern and classification of expense recognition in the income statement.

The new standard was effective for us on January 1, 2019 and we have adopted it. A modified retrospective transition approach is required, applying the new standard to all leases existing at the date of initial application. An entity may choose to use either (1) its effective date or (2) the beginning of the earliest comparative period presented in the financial statements as its date of initial application. If an entity chooses the second option, the transition requirements for existing leases also apply to leases entered into between the date of initial application and the effective date. The entity must also recast its comparative period financial statements and provide the disclosures required by the new standard for the comparative periods. We expect to adopt the new standard on January 1, 2019 and use the effective date as our date of initial application. Consequently, financial information will not be updated and the disclosures required under the new standard will not be provided for dates and periods before January 1, 2019. The Company does not expect the adoption of this ASU to have a material impact on its consolidated financial statements as the Company has no leases whose term is greater than one year.

In February 2018, the FASB issued ASU No. 2018-02, Reclassification of Certain Tax Effects from Accumulated Other Comprehensive Income . The guidance permits entities to reclassify tax effects stranded in Accumulated Other Comprehensive Income as a result of tax reform to retained earnings. This new guidance is effective for annual and interim periods in fiscal years beginning after December 15, 2018. Early adoption is permitted in annual and interim periods and can be applied retrospectively or in the period of adoption. The Company is currently in the process of evaluating the impact of adoption on its consolidated financial statements.

In March 2018, the FASB issued ASU No. 2018-05, Income Taxes (Topic 740) - Amendments to SEC Paragraphs Pursuant to SEC Staff Accounting Bulletin No. 118. The amendment provides guidance on accounting for the impact of the Tax Cuts and Jobs Act (the “Tax Act”) and allows entities to complete the accounting under ASC 740 within a one-year measurement period from the Tax Act enactment date. This standard is effective upon issuance. The Tax Act has several significant changes that impact all taxpayers, including a transition tax, which is a one-time tax charge on accumulated, undistributed foreign earnings. The calculation of accumulated foreign earnings requires an analysis of each foreign entity’s financial results going back to 1986. The Company does not expect the adoption of this ASU to have a material impact on its consolidated financial statements.

In June 2018, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) 2018-07, Compensation-Stock Compensation (Topic 718): Improvements to Nonemployee Share-Based Payment Accounting , which expands the scope of Topic 718 to include share-based payment transactions for acquiring goods and services from nonemployees. An entity should apply the requirements of Topic 718 to nonemployee awards except for specific guidance on inputs to an option pricing model and the attribution of cost (that is, the period of time over which share-based payment awards vest and the pattern of cost recognition over that period). The new guidance is effective for all entities for annual periods, and interim periods within those annual periods, beginning after December 15, 2017, with early adoption permitted. The Company does not expect the adoption of this ASU to have a material impact on its consolidated financial statements.

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Debt (Tables)

3 Months Ended

Mar. 31, 2019

Debt

Schedule of Convertible notes payable

	03/31/19			12/31/18
All convertible promissory notes
Unpaid principal		1,007,889			1,121,243
Discounts		(28,129	)		(45,750	)
Convertible notes payable, net	$	979,760		$	1,075,493
Classified as short-term
Unpaid principal balance		642,182			673,678
Discounts		(360	)		(45,750	)
Convertible notes payable - short-term, net	$	641,822		$	627,928
Classified as long-term
Unpaid principal balance		98,651			25,000
Discounts		(27,769	)		-
Convertible notes payable - short-term, net	$	70,882		$	25,000
Classified as in default
Unpaid principal balance		267,056			422,565
Discounts		-			-
Convertible notes payable - short-term, net	$	267,056		$	422,565

Changes in outstanding derivative liabilities

Balance, December 31, 2018	$	365,497
Changes due to new issuances		31,312
Changes due to extinguishments		(175,780	)
Changes due to adjustment to fair value		(58,360	)
Balance, March 31, 2019	$	162,669

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Income Taxes (Tables)

3 Months Ended

Mar. 31, 2019

Notes to Financial Statements

Summary of deferred income taxes

	03/31/19			12/31/18
Net operating loss carry-forward		3,662,833			3,380,285
Deferred tax asset at 21%	$	769,195		$	709,860
Valuation allowance		(769,195	)		(709,860	)
Net future income taxes	$	-		$	-

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Organization and Nature of Business (Details Narrative)	3 Months Ended
	Mar. 31, 2019
State or Country of incorporation	Delaware
Entity incorporation date	Jun. 05, 2006
ArKnet [Member]
Organization and nature of business description	The ArKnet is a fintech platform connecting consumers to providers in the global $48 trillion household purchasing market, using augmented reality as the medium of interaction.

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Related Party Transactions (Details Narrative) - USD ($)	3 Months Ended
	Mar. 31, 2019	Dec. 31, 2018
Exercise price	$ 1.00
Adjustment to additional paid in capital, Imputed interest	$ 1,520
Twenty Second Trust [Member]
Accrued interest	$ 21,744
Interest payment default description	According to our agreement with Mr. Nugent, we accrue interest on all unpaid amounts at 5%. Principal and interest are callable at any time. If principal and interest are called and not repaid, the loan is considered in default after which interest is accrued at 10%.
Twenty Second Trust [Member] | Related Party [Member]
Accrued interest	$ 1,213
Outstanding principal amount	119,947	$ 118,591
Dr. Leonard [Member]
Proceeds from additional related-party loan	18,000
Principal payments on related-party loans	$ 11,188

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Capital (Details Narrative) - USD ($)		1 Months Ended	3 Months Ended		12 Months Ended
	Aug. 14, 2018	Aug. 29, 2017	Mar. 31, 2019	Mar. 31, 2018	Dec. 31, 2018
Imputed interest			$ 4,008	$ 4,750
Common stock shares issued for incentive to creditor			15,000,000
Debt discount			$ 127,500
Preferred stock shares authorized			13,795,104		13,795,104
Preferred stock, par value			$ 0.0001		$ 0.0001
Shares issued for settlement of lawsuit	$ 5,000		$ 5,000
Gain or (loss) on litigation	$ (55,000)	$ 2,426,668	$ (55,000)
Shares issued for settlement	10,000,000		10,000,000
Convertible promissory note [Member]
Debt discount			$ 31,312
Debt conversion converted instrument shares issued			221,542,274		246,542,274
Principal reduction on debt conversion original amount			$ 306,623
Reduction on debt conversion converted instrument, Accrued interest			27,728
Loss on conversion			41,278
Decrease in derivative liabilities			$ 326,339
Convertible promissory note One [Member]
Shares issued			939,263,152
Debt conversion converted instrument shares issued			935,640,097
Principal reduction on debt conversion original amount			$ 218,508
Reduction on debt conversion converted instrument, Accrued interest			11,914
Loss on conversion			120,775
Conversion fees			4,000
Decrease in derivative liabilities			175,780
Australian Individual [Member] | Convertible promissory note [Member]
Debt discount			$ 48,934
Debt conversion converted instrument shares issued			3,623,055
Principal reduction on debt conversion original amount			$ 4,258
Reduction on debt conversion converted instrument, Accrued interest			695
Gain or (loss) on litigation			$ 1,330
Series E Preferred Stock [Member]
Accrued expenses					$ 1,837,000
Series E Preferred Stock [Member] | ArKnet [Member]
Preferred stock shares authorized					40,000
Preferred stock, par value					$ 0.0001
Description for share exchange ratio and voting rights			Each share has the voting rights of all other voting shares combined, multiplied by 0.00001,

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Debt (Details) - USD ($)	Mar. 31, 2019	Dec. 31, 2018
All convertible promissory notes [Member]
Unpaid principal	$ 1,007,889	$ 1,121,243
Discounts	(28,129)	(45,750)
Convertible notes payable	979,760	1,075,493
Classified as short-term [Member]
Unpaid principal	642,182	673,678
Discounts	(360)	(45,750)
Convertible notes payable	641,822	627,928
Classified as long-term [Member]
Unpaid principal	98,651	25,000
Discounts	(27,769)
Convertible notes payable	70,882	25,000
Classified as in default [Member]
Unpaid principal	267,056	422,565
Discounts
Convertible notes payable	$ 267,056	$ 422,565

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Debt (Details 1)	3 Months Ended
	Mar. 31, 2019 USD ($)
Debt Details 1Abstract
Beginning balance	$ 365,497
Changes due to new issuances	31,312
Changes due to extinguishments	(175,780)
Changes due to adjustment to fair value	(58,360)
Ending balance	$ 162,669

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Debt (Details Narrative)			1 Months Ended		3 Months Ended		12 Months Ended
	Jan. 11, 2019 USD ($) shares	Aug. 07, 2018 USD ($)	Jan. 23, 2019 USD ($) shares	Jan. 16, 2019 USD ($) shares	Mar. 31, 2019 USD ($) Number $ / shares shares	Mar. 31, 2018 USD ($)	Dec. 31, 2018 USD ($) shares
Proceeds from convertible notes payable					$ 105,475	$ 593,000
Debt discount					127,500
Convertible notes payable - related party					88,152		$ 81,340
Convertible notes payable, interest						$ 2,720
Convertible notes payable, principal					641,822		627,928
Twenty Second Trust [Member]
Loans from related parties					208,099
Accrued interest					$ 21,744
Convertible Note Derivatives [Member]
Default interest rate, description					• An event of default would occur 0% of the time, increasing 1.00% per month to a maximum of 20%.
Notes redemption, description					The Holders would redeem the notes (with penalties up to 50% depending on the date and full–partial redemption) based on availability of alternative financing of 0% of the time, increasing 1.00% per month to a maximum of 5%.
Fair value of derivatives					$ 162,668
Convertible Note Derivatives [Member] | Minimum [Member]
Assumption of stock price per shares | $ / shares					$ 0.0013
Notes conversion trading days | Number					20
Estimated effective discount rate					35.00%
Volatility rate					157.80%
Effective interest rate					243.00%
Convertible Note Derivatives [Member] | Maximum [Member]
Assumption of stock price per shares | $ / shares					$ 0.0005
Notes conversion trading days | Number					25
Estimated effective discount rate					42.00%
Volatility rate					296.00%
Effective interest rate					289.00%
Crypto Exchange Promissory Note [Member]
Convertible promissory notes, issued		$ 100,000
Interest rate description		The Crypto Note accrues interest at 4% until maturity which is 18 months from issue and 10% after maturity.
Debt conversion, description		The holder can convert unpaid principal and accrued interest into KLK20 tokens at any time at the rate of $0.25 per token.
Convertible promissory note [Member]
Convertible promissory notes, issued							633,000
Proceeds from convertible notes payable					$ 105,475		561,313
Beneficial conversion feature of convertible notes							209,040
Original issue discount							$ 71,688
Debt discount					31,312
Convertible notes payable - related party					88,152
Convertible notes payable, principal					$ 1,002,735
Debt instrument converted amount shares issued | shares					221,542,274		246,542,274
Convertible promissory note [Member] | Accrues interest[Member]
Bearing interest rate	5.00%		5.00%	5.00%
Convertible promissory note [Member] | Principal [Member]
Bearing interest rate	10.00%		10.00%	10.00%
Convertible promissory note [Member] | Australian Individual [Member]
Number of convertible promissory notes | Number					2
Convertible notes payable, default					$ 267,056
Debt discount					48,934
Accrued interest					29,224
Convertible notes payable, interest					695
Convertible notes payable, principal					4,258
Gain on settlement					$ 1,330
Debt instrument converted amount shares issued | shares					3,623,055
Promissory note [Member]
Convertible promissory notes, issued	$ 100,000		$ 1,475	$ 4,000
Maturity date	Jul. 08, 2020		Jul. 23, 2020	Jul. 16, 2020
Convertible note converted in shares | shares	83,333,333		1,109,023	3,007,519

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Litigation (Details Narrative) - USD ($)			1 Months Ended			3 Months Ended
	Aug. 14, 2018	Oct. 12, 2017	Oct. 17, 2017	Aug. 29, 2017	Dec. 16, 2016	Mar. 31, 2019	Dec. 31, 2018	Oct. 10, 2017	Oct. 07, 2017
Amount of damages sought					$ 2,377,915
Loss contingency damages sought interest amount					$ 4,459
Interest rate					4.50%
Litigation amount damages sought included in liabilities removed				$ 2,377,915
Litigation amount damages sought accrued interest included in liabilities removed				4,459			$ 44,294
Shares issued for settlement of lawsuit	$ 5,000					$ 5,000
Gain or (loss) on litigation	$ (55,000)			$ 2,426,668		$ (55,000)
Shares issued for settlement	10,000,000					10,000,000
McRae [Member]
Loss contingency damages sought, liabilities recognized			$ 250,000						$ 49,000
Gain or (loss) on litigation			$ 201,000
Loss contingency damages sought by related party, restricted shares								850,000,000
Description for the amendment to the litigation filed against company by related party		McRae filed a complaint, later amended twice, against the Company in the US District Court in Kansas. The amended complaint alleges 1) that the Company breached a written agreement in an alleged employment by failing to pay him 35 million shares of the Company’s common stock and terminating his association with the Company on June 16, 2017 without proper notice. The complaint goes on to allege 2) that the Company committed fraud by silence for failing to inform him of an intent to receive the benefit of his services while harboring an intent to not compensate him, 3) that the Company breached an unwritten agreement with him to provide him with 185 million shares of the Company’s common stock, and 4) that the Company breached a convertible promissory note by failing and refusing to repay him the principal and accrued interest thereunder
Litigation settlement, shares offered			50,000,000

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Income Taxes (Details) - USD ($)	Mar. 31, 2019	Dec. 31, 2018
Income Taxes
Net operating loss carry-forward	$ 3,662,833	$ 3,380,285
Deferred tax asset at 21%	769,195	709,860
Valuation allowance	(769,195)	(709,860)
Net future income taxes

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Income Taxes (Details Narrative)	3 Months Ended
	Mar. 31, 2019
Income Taxes
Operating loss carry-forwards expiration period	Tax loss carry-forwards will begin to expire in 2030

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Subsequent Events (Details Narrative)	3 Months Ended
	Mar. 31, 2019 shares
Subsequent Event [Member]
Debt instrument converted amount shares issued	501,389,937