SFOR StrikeForce Technologies Inc (QB)

 

SCHEDULE 14C

Information Required in Proxy Statement

Pursuant to Section 14(a) of the Securities Exchange Act of 1934

 

Check the appropriate box:

 

x	Preliminary Information Statement
¨	Definitive Information Statement

  

StrikeForce Technologies, Inc.

(Name of Company As Specified In Charter)

 

Not Applicable

(Name of Person(s) Filing the Information Statement if other than Company)

 

Payment of Filing Fee (Check the appropriate box):

 

x	No fee required.
¨	Fee computed on table below per Exchange Act Rules 14c-5(g) and 0-11.

 

1) Title of each class of securities to which transaction applies:

 

Common Stock, par value $0.0001 per share

 

2) Aggregate number of securities to which transaction applies:

 

1,382,667,553 common shares; 3 Series A preferred shares; 125,337 Series B preferred shares

 

3) Per unit price or other underlying value of transaction computed pursuant to Exchange Act Rule 0-11:

 

4) Proposed maximum aggregate value of transaction:

 

¨	Check box if any part of the fee is offset as provided by Exchange Act Rule 0-11(a)(2) and identify the filing for which the offsetting fee was paid previously. Identify the previous filing by registration statement number, or the Form or Schedule and the date of its filing.

  

 1) Amount Previously Paid:

 

 2) Form, Schedule or Registration Statement No.:

 

 3) Filing Party:

 

 4) Date Filed:

 

 

 

StrikeForce Technologies, Inc.

1090 King Georges Post Road

Suite #603

Edison, NJ 08837

(732) 661 9641

Facsimile: (732) 661-9647

Email: marklkay@strikeforcetech.com

 

INFORMATION STATEMENT

PURSUANT TO SECTION 14 OF THE SECURITIES EXCHANGE ACT OF 1934,

AS AMENDED, AND REGULATION 14C AND SCHEDULE 14C THEREUNDER

 

WE ARE NOT ASKING YOU FOR A PROXY

AND YOU ARE REQUESTED NOT TO SEND US A PROXY

INTRODUCTION

 

This notice and information statement (the “Information Statement”) will be mailed on or about June 29, 2015 to the stockholders of record, as of June 16, 2015 to shareholders of StrikeForce Technologies, Inc., a Wyoming corporation (the “Company”) pursuant to: Section 14(c) of the Exchange Act of 1934, as amended. This Information Statement is circulated to advise the shareholders of action already approved and taken without a meeting by written consent of three stockholders (management) holding a total of three Series A Preferred Shares (The three shares of Series A Preferred Shares held by management equals 80% of the current and outstanding preferred shares, (which are converted to common shares strictly for voting rights purposes only and are calculated by multiplying the number of current outstanding preferred and common shares times four (4)), (The 125,337 shares of Series B preferred that are at $1.50 and convert into common shares) and the outstanding preferred and common shares for voting purposes only; thus, combined with the 1,382,667,553 issued and outstanding shares of common stock and outstanding preferred shares, there would be a total of 6,915,468,509 voting capital shares of which 5,532,675,616 have voted in favor of the action. Pursuant to Rule 14c-2 under the Securities Exchange Act of 1934, as amended, the corporate actions described in this Notice can be taken no sooner than 20 calendar days after the accompanying Information Statement is first sent or given to the Company’s stockholders. Since the accompanying Information Statement is first being sent or given to security holders on or about June 29, 2015 to the corporate action described therein may be effective on or after July 20, 2015.

 

Please review the Information Statement included with this Notice for a more complete description of this matter. This Information Statement is being sent to you for informational purposes only.

 

WE ARE NOT ASKING YOU FOR A PROXY AND YOU ARE REQUESTED NOT

TO SEND US A PROXY.

 

The actions to be effective twenty days after the mailing of this Information Statement are as follows:

 

(1) to effectuate a 1,000 :1 Reverse Stock Split (pro-rata reduction of outstanding shares) of our issued and outstanding shares of Common Stock (the "Reverse Stock Split"); and

 

(2) to increase the authorized shares from three billion (3,000,000,000) up to five billion (5,000,000,000)

 

Both the Reverse Stock Split and the Increase in Authorized described in the accompanying Information Statement, effective as of the filing of amendment to the Company's Certificate of Incorporation with the Wyoming Secretary of State, have been duly authorized and approved by the written consent of the holders of a majority of the voting capital shares of the Company’s issued and outstanding voting securities, your vote or consent is not requested or required. The accompanying Information Statement is provided solely for your information. The accompanying Information Statement also serves as the notice required by the Section 17-16-724 of the Wyoming Statutes of the taking of a corporate action without a meeting by less than unanimous written consent of the Company’s stockholders.

 

By order of the Board of Directors,

Mark L. Kay 

Chief Executive Officer

 

June 19, 2015

 

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The elimination of the need for a meeting of stockholders to approve this action is made possible by Wyoming Statutes which provides that the written consent of the holders of outstanding shares of voting capital stock, having not less than the minimum number of votes which would be necessary to authorize or take such action at a meeting at which all shares entitled to vote thereon were present and voted, may be substituted for such a meeting. In order to eliminate the costs involved in holding a special meeting of our stockholders, our Board of Directors voted to utilize the written consent of the holders of a majority in interest of our voting securities. This Information Statement is circulated to advise the shareholders of action already approved by written consent of the shareholders who collectively hold a majority of the voting power of our capital stock.

 

THE PRIVATE SECURITIES LITIGATION REFORM ACT OF 1995 PROVIDES A “SAFE HARBOR” FOR FORWARD LOOKING STATEMENTS. This Information Statement contains statements that are not historical facts. These statements are called “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. These statements involve important known and unknown risks, uncertainties and other factors and can be identified by phrases using “estimate,” “anticipate,” “believe,” “project,” “expect,” “intend,” “predict,” “potential,” “future,” “may,” “should” and similar expressions or words. Our future results, performance or achievements may differ materially from the results, performance or achievements discussed in the forward-looking statements. There are numerous factors that could cause actual results to differ materially from the results discussed in forward-looking statements, including:

 

	·	Changes in relationships and market for the development of the business of the Company that would affect our earnings and financial position.
	·	Considerable financial uncertainties that could impact the profitability of our business.
	·	Factors that we have discussed in previous public reports and other documents filed with the Securities and Exchange Commission.

  

This list provides examples of factors that could affect the results described by forward-looking statements contained in this Information Statement. However, this list is not intended to be exhaustive; many other factors could impact our business and it is impossible to predict with any accuracy which factors could result in which negative impacts. Although we believe that the forward-looking statements contained in this Information Statement are reasonable, we cannot provide you with any guarantee that the anticipated results will be achieved. All forward-looking statements in this Information Statement are expressly qualified in their entirety by the cautionary statements contained in this section and you are cautioned not to place undue reliance on the forward-looking statements contained in this Information Statement. In addition to the risks listed above, other risks may arise in the future, and we disclaim any obligation to update information contained in any forward-looking statement.

 

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TABLE OF CONTENTS

 

		Page
ABOUT THIS INFORMATION STATEMENT			5
General			5
Board Approval of the Reverse Split and Decrease of Authorized Shares			5
The Action by Written Consent			8
No Further Voting Required			9
Notice Pursuant to the Wyoming Statutes			9
Dissenters’ Rights of Appraisal			9
INFORMATION ON CONSENTING SHAREHOLDERS			40
DELIVERY OF INFORMATION STATEMENT			43
WHERE YOU CAN FIND MORE INFORMATION			44

  

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StrikeForce Technologies, Inc.

1090 King Georges Post Road

Suite #603

Edison, NJ 08837

 (732) 661-9641

Facsimile: (732) 661-9647

Email: marklkay@strikeforcetech.com

 

This Information Statement is being furnished by StrikeForce Technologies, Inc., a Wyoming corporation (“we,” “us,” “our” or the “Company”), in connection with action taken by the holders of a majority of the voting power of the Company’s issued and outstanding voting securities. By written consent dated June 17, 2015, the holders of a majority of the voting power approved a resolution to effectuate a 1,000:1 Reverse Stock Split. Under this Reverse Stock Split each 1,000 shares of our Common Stock will be automatically converted into 1 share of Common Stock and an increase in authorized Shares of Common Stock from three billion (3,000,000,000) shares of common stock up to five billion (5,000,000,000) shares of common stock, $0.0001 par value, of the Company. We are first sending or giving this Information Statement on or about June 29, 2015 to our stockholders of record as of the close of business on June 17, 2015 (the “Record Date”). Our principal executive offices are located at 1090 King Georges Post Road, Suite #603, Edison, NJ 08837 and our main telephone number is (732) 661-9641.

 

BOARD AND SHAREHOLDER APPROVAL OF THE REVERSE STOCK SPLIT AND REDUCTION OF AUTHORIZED STOCK

 

On June 17, 2015, the Board of Directors and the holders of a majority of the voting power approved a resolution to effectuate a 1,000:1 Reverse Stock Split. Under this Reverse Stock Split each 1,000 shares of our Common Stock will be automatically converted into 1 share of Common Stock. To avoid the issuance of fractional shares of Common Stock, the Company will issue an additional share to all holders of fractional shares. The effective date of the reverse stock split will be on or after July 20, 2015. In addition, as discussed below, the Board of Directors and the holders of a majority of the voting power approved a resolution to effectuate an increase in authorized Shares of Common Stock from three billion (3,000,000,000) shares of common stock up to five billion (5,000,000,000) shares of common stock, $0.0001 par value.

 

PLEASE NOTE THAT THE REVERSE STOCK SPLIT WILL NOT CHANGE YOUR PROPORTIONATE EQUITY INTERESTS IN THE COMPANY, EXCEPT AS MAY RESULT FROM THE ISSUANCE OF SHARES PURSUANT TO THE FRACTIONAL SHARES.

 

PLEASE NOTE THAT THE REVERSE STOCK SPLIT WILL HAVE THE EFFECT OF SUBSTANTIALLY INCREASING THE NUMBER OF SHARES THE COMPANY WILL BE ABLE TO ISSUE TO NEW OR EXISTING SHAREHOLDERS BECAUSE THE NUMBER OF AUTHORIZED SHARES WILL BE INCREASED BY 60% WHILE THE NUMBER OF SHARES ISSUED AND OUTSTANDING WILL BE DECREASED 1000 FOLD.

 

PURPOSE AND MATERIAL EFFECTS OF THE REVERSE STOCK SPLIT

 

The Board of Directors believes that the low stock price and the large number of outstanding shares of our Common Stock have reached a difficult time for clients and investors for the Company. Therefore, with the security software market now, in managements’ opinion, definitely at a peak, such as with SONY, Target, Home Depot, JPMorgan, the FED, Global Hacks, Keylogging, Healthcare companies and banks and other malware hacks, StrikeForce is negotiating with patent and other investors to meet the clients' needs with our upgraded products (that took longer than expected, but are now done), including MobileTrust®. The Board of Directors also believes that the timing is now right in light of our Company’s six patents and litigation, new contracted and interested clients that closed and are due, we believe, in this Fall, and the global channel partners and very interested investors that are engaged with StrikeForce increases in revenues and investments in 2015. As a result, the Board of Directors has proposed the Reverse Stock Split to maintain the business momentum going forward through this Fall 2015, when we expect, but cannot guarantee, to achieve our goals for revenues and investors.

 

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The number of authorized, issued and outstanding, and available shares of common and preferred shares are disclosed in the tables below:

 

		Authorized Shares of Common Stock		Number of Issued and Outstanding Shares of Common Stock		Number of Shares of Common Stock Available in Treasury for Issuance
Pre-Reverse Stock Split (as of June 17, 2015)		3,000,000,000 shares of Common Stock		1,382,667,553shares of Common Stock		1,617,332,447 shares of Common Stock
Post-Reverse Stock Split		5,000,000,000 shares of Common Stock		1,382,668 shares of Common Stock(1)		4,998,617,332 shares of Common Stock(1)

  

(1) Depending on the number of fractional shares that are issued.

 

There will be no adjustments to the authorized or the issued and outstanding shares of preferred stock.

 

There are no plans, arrangements, understandings, etc. for the newly authorized but unissued shares that will become available following our 1-for-1,000 reverse stock split.

 

When a company engages in a Reverse Stock Split, it substitutes one share of stock for a predetermined amount of shares of stock. It does not increase the market capitalization of the company. An example of a reverse split is the following. A company has 10,000,000 shares of common stock outstanding. Assume the market price is $0.01 per share. Assume that the company declares a 1 for 5 reverse stock split. After the reverse split, that company will have 1/5 as many shares outstanding or 2,000,000 shares outstanding. The stock will have a market price of $0.05. If an individual investor owned 10,000 shares of that company before the split at $0.01 per share, he will own 2,000 shares at $0.05 after the split. In either case, his stock will be worth $100. He is no better off before or after. Except that such company hopes that the higher stock price will make that company look better and thus the company will be a more attractive investor or merger or purchase target for potential business. There is no assurance that that company's stock will rise in price after a reverse split or that a suitable investor, merger or purchaser candidate will emerge.

 

The Board of Directors believes that the Reverse Stock Split may improve the price level of our Common Stock and that the higher share price could help generate interest in the Company among investors and other business opportunities. However, the effect of the reverse split upon the market price for our Common Stock cannot be predicted, and the history of similar stock split combinations for companies in like circumstances is varied. There can be no assurance that the market price per share of our Common Stock after the reverse split will rise in proportion to the reduction in the number of shares of Common Stock outstanding resulting from the reverse split. The market price of our Common Stock may also be based on our performance and other factors, some of which may be unrelated to the number of shares outstanding.

 

The reverse split will affect all of our stockholders uniformly and will not affect any stockholder's percentage ownership interests in the Company or proportionate voting power, except to the extent that the reverse split results in any of our stockholders owning a fractional share. All stockholders holding a fractional share shall be issued an additional share. The principal effect of the Reverse Stock Split will be that the number of shares of Common Stock issued and outstanding will be reduced from 1,382,667,553 shares of Common Stock as of July 19, 2015 to approximately 1,382,668 Common Stock, $0.0001 par value (depending on the number of fractional shares that are issued). The Reverse Stock Split will affect the shares of common stock outstanding. Currently, the Company only has three (3) Series A Preferred Shares and 125,733 Series B Preferred Shares that are not affected. These Preferred Series ‘A’ Shares are not convertible to shares of Common Stock other than for their voting rights as defined in the Bylaws. The reverse Split will not affect any convertible securities currently outstanding, other than a few Convertible Promissory notes with fixed convertible prices,, as such securities for the most part, convert based on a percentage calculation related to stock price alone. The Reverse Stock Split will not affect the par value of our Common Stock. As a result, on the effective date of the Reverse Stock Split, the stated capital on our balance sheet attributable to our Common Stock will be reduced to less than the present amount, and the additional paid-in capital account shall be credited with the amount by which the stated capital is reduced. The per share net income or loss and net book value of our Common Stock will be increased because there will be fewer shares of our Common Stock outstanding.

 

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The Reverse Stock Split will not change the proportionate equity interests of our stockholders, nor will the respective voting rights and other rights of stockholders be altered. The Common Stock issued pursuant to the Reverse Stock Split will remain fully paid and non-assessable. The Reverse Stock Split is not intended as, and will not have the effect of, a “going private transaction” covered by Rule 13e-3 under the Securities Exchange Act of 1934. We will continue to be subject to the periodic reporting requirements of the Securities Exchange Act of 1934.

 

Stockholders should recognize that they will own fewer numbers of shares than they presently own (a number equal to the number of shares owned immediately prior to the filing of the certificate of amendment divided by 1,000 ). While we expect that the Reverse Stock Split will result in an increase in the potential market price of our Common Stock, there can be no assurance that the Reverse Stock Split will increase the potential market price of our Common Stock by a multiple equal to the exchange number or result in the permanent increase in any potential market price (which is dependent upon many factors, including our performance and prospects). Also, should the market price of our Common Stock decline, the percentage decline as an absolute number and as a percentage of our overall market capitalization may be greater than would pertain in the absence of a reverse split. Furthermore, the possibility exists that potential liquidity in the market price of our Common Stock could be adversely affected by the reduced number of shares that would be outstanding after the reverse split. In addition, the reverse split will increase the number of stockholders of the Company who own odd lots (less than 100 shares). Stockholders who hold odd lots typically will experience an increase in the cost of selling their shares, as well as possible greater difficulty in effecting such sales. Consequently, there can be no assurance that the reverse split will achieve the desired results that have been outlined above.

 

SUMMARY OF REVERSE STOCK SPLIT

 

Below is a brief summary of the Reverse Stock Split:

 

	·	The issued and outstanding Common Stock shall be reduced on the basis of one post-split share of the Common Stock for every 1,000 pre-split shares of the Common Stock outstanding. The consolidation shall not affect any rights, privileges or obligations with respect to the shares of the Common Stock existing prior to the consolidation.
	·	Stockholders of record of the Common Stock as of June 17, 2015 shall have their total shares reduced on the basis of one post-split share of Common Stock for every 1,000 pre-split shares outstanding.
	·	As a result of the reduction of the Common Stock, the pre-split total of issued and outstanding shares of 1,382,667,553 shall be consolidated to a total of approximately 1,382,668 issued and outstanding shares (depending on the number of fractional shares that are be issued or cancelled).

  

The Reverse Split of the Common Stock is expected to become effective after we file Articles of Amendment to our Articles of Incorporation (the “Effective Date”). Upon the Effective Date, the Company will notify FINRA and request an ex-dividend date. The Reverse Split will take place on the Effective Date without any action on the part of the holders of the Common Stock and without regard to current certificates representing shares of Common Stock being physically surrendered for certificates representing the number of shares of Common Stock each shareholder is entitled to receive as a result of the Reverse Split. New certificates of Common Stock will not be issued at this time.

 

We do not have any provisions in our Articles, by laws, or employment or credit agreements to which we are party that have anti-takeover consequences. We do not currently have any plans to adopt anti-takeover provisions or enter into any arrangements or understandings that would have anti-takeover consequences. In certain circumstances, our management may issue additional shares to resist a third party takeover transaction, even if done at an above market premium and favored by a majority of independent shareholders.

 

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There are no adverse material consequences or any anti-takeover provisions in either our Articles of Incorporation or Bylaws that would be triggered as a consequence of the Reverse Split. The Articles of Incorporation or Bylaws do not address any consequence of the Reverse Split. See below for a discussion on the federal Income Tax consequences of the Reverse Split.

   

BOARD AND SHAREHOLDER APPROVAL OF THE REDUCTION IN AUTHORIZED SHARES OF COMMON STOCK

 

On June 17, 2015, the Board of Directors and holders of a majority of the voting power approved a resolution for an Increase in Authorized Shares from three billion (3,000,000,000) Common Stock up to five billion (5,000,000,000) Common Stock, $0.0001 par value, of the Company.

 

SUMMARY OF THE REDUCTION IN AUTHORIZED

 

The Board of Directors and the holders of the majority of the voting shares increased the number of authorized Common Stock by 60% from three billion (3,000,000,000) Common Stock down to five billion (5,000,000,000) Common Stock, $0.0001 par value, of the Company.

 

We have no present understandings or agreements that will involve the issuance of capital stock. However, we are engaged in negotiations with respect to transactions, including financings and acquisitions, which could involve the issuance of capital stock. As of the date herein, there are no definitive agreements, letters of intent of memorandums of understanding with respect to any transactions, financings or acquisitions.

 

The Action by Written Consent

 

On June 17, 2015, Board of Directors and the holders of a majority of the voting power approved the following:

 

	·	a resolution to effectuate a 1,000:1 Reverse Stock Split. Under this Reverse Stock Split each 1,000 shares of our Common Stock will be automatically converted into 1 share of Common Stock. To avoid the issuance of fractional shares of Common Stock, the Company will issue an additional share to all holders of fractional shares
	·	a resolution for an Increase in Authorized from three billion (3,000,000,000) Common Stock up to five billion (5,000,000,000) Common Stock, $0.0001 par value, of the Company.

  

The holders of a majority of the votes of the Company’s outstanding voting securities are comprised of three shares of Series A Preferred Shares which equals 80% of the current and outstanding preferred shares (calculated by multiplying the number of current outstanding preferred and common shares by four (4)), for voting purposes only, held by management, added to the current outstanding common and preferred shares; thus, combined with the 1,382.667,553 issued and outstanding shares of common stock and preferred shares, there would be a total of 6,915,468,509 voting capital shares of which 5,532,675,616 have voted in favor of the action. These Preferred Series ‘A’ Shares are not convertible to shares of Common Stock. The reverse Split will not affect any convertible securities currently outstanding, other than a few Convertible Promissory notes with fixed convertible prices, as such securities convert for the most part based on a percentage calculation related to stock price alone.

 

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No Further Voting Required

 

We are not seeking consent, authorizations, or proxies from you. Section 17-16-724 of the Wyoming Statutes and our bylaws provide that actions requiring a vote of the stockholders may be approved by written consent of the holders of outstanding shares of voting capital stock having not less than the minimum number of votes which would be necessary to authorize or take such action at a meeting at which all shares entitled to vote thereon were present and voted. The approval by at least a majority of the outstanding voting power of our voting securities is required to approve the reverse split and the decrease in the authorized shares of common stock.

 

Notice Pursuant to the Wyoming Statutes

 

Pursuant to the Wyoming Statutes, we are required to provide prompt notice of the taking of corporate action by written consent to our stockholders who have not consented in writing to such action. This Information Statement serves as the notice required by the Wyoming Statutes.

   

Dissenters’ Rights of Appraisal

 

The Wyoming Statutes does not provide dissenters’ rights of appraisal to our stockholders in connection with the matters approved by the Written Consent.

 

“Company,” “our company,” “us,” “SFT,” “StrikeForce,” “we” and “our” refer to StrikeForce Technologies, Inc. unless the context requires otherwise

 

SPECIAL NOTE REGARDING FORWARD-LOOKING STATEMENTS

 

This Information Statement contains certain forward-looking statements regarding management’s plans and objectives for future operations including plans and objectives relating to our planned marketing efforts and future economic performance. The forward-looking statements and associated risks set forth in the registration statement include or relate to, among other things, acceptance of our proposed services and the products we expect to market, our ability to establish a customer base, managements’ ability to raise capital in the future, the retention of key employees and changes in the regulation of our industry. These statements may be found under “Management’s Discussion and Analysis of Financial Condition and Results of Operations” and “Description of Business,” as well as in the registration statement generally. Actual events or results may differ materially from those discussed in forward-looking statements as a result of various factors, including, without limitation, the risks outlined under “Risk Factors” and matters described in the registration statement generally. In light of these risks and uncertainties, there can be no assurance that the forward-looking statements contained in the registration statement will in fact occur.

 

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The forward-looking statements herein are based on current expectations that involve a number of risks and uncertainties. Such forward-looking statements are based on assumptions described herein. The assumptions are based on judgments with respect to, among other things, future economic, competitive and market conditions, and future business decisions, all of which are difficult or impossible to predict accurately and many of which are beyond our control. Accordingly, although we believe that the assumptions underlying the forward-looking statements are reasonable, any such assumption could prove to be inaccurate and therefore there can be no assurance that the results contemplated in forward-looking statements will be realized. In addition, as disclosed elsewhere in the “Risk Factors” section of the registration statement, there are a number of other risks inherent in our business and operations which could cause our operating results to vary markedly and adversely from prior results or the results contemplated by the forward-looking statements. Management decisions, including budgeting, are subjective in many respects and periodic revisions must be made to reflect actual conditions and business developments, the impact of which may cause us to alter marketing, capital investment and other expenditures, which may also materially adversely affect our results of operations. In light of significant uncertainties inherent in the forward-looking information included in the registration statement, the inclusion of such information should not be regarded as a representation by us or any other person that our objectives or plans will be achieved.

 

Any statement in the registration statement that is not a statement of an historical fact constitutes a “forward-looking statement”. Further, when we use the words “may”, “expect”, “anticipate”, “plan”, “believe”, “seek”, “estimate”, “internal”, and similar words, we intend to identify statements and expressions that may be forward- looking statements. We believe it is important to communicate certain of our expectations to our investors. Forward-looking statements are not guarantees of future performance. They involve risks, uncertainties and assumptions that could cause our future results to differ materially from those expressed in any forward-looking statements. Many factors are beyond our ability to control or predict. You are accordingly cautioned not to place undue reliance on such forward-looking statements. Important factors that may cause our actual results to differ from such forward-looking statements include, but are not limited to, the risks outlined under “Risk Factors” herein. The reader is cautioned that our company does not have a policy of updating or revising forward-looking statements and thus the reader should not assume that silence by management of our company over time means that actual events are bearing out as estimated in such forward-looking statements.

   

Corporate History and Business

 

We are a software development and services company that offers a suite of integrated computer network security products using proprietary technology. StrikeForce Technical Services Corporation was incorporated in August 2001 under the laws of the State of New Jersey. On September 3, 2004, we changed our name to StrikeForce Technologies, Inc. On November 15, 2010, we redomiciled under the laws of the State of Wyoming. We initially conducted operations as an integrator and reseller of computer hardware and telecommunications equipment and services until December 2002. In December 2002, and formally memorialized in September 2003, we acquired certain intellectual property rights and patent pending technology from NetLabs.com, Inc. (“NetLabs”) including the rights to further develop and sell their principal technology. In addition, certain officers of NetLabs joined our company as officers and directors of our company. Our ongoing strategy is developing and marketing our suite of network security products to the corporate, financial, healthcare, legal, government, technology, insurance, e-commerce and consumer sectors. We plan to continue to grow our business primarily through our globally expanding sales channel and internally generated sales, rather than by acquisitions. We have no subsidiaries and we conduct our operations from our corporate office in Edison, New Jersey.

 

We began our operations in 2001 as a reseller and integrator of computer hardware and iris biometric technology. From the time we started our operations through the first half of 2003, we derived the majority of our revenues as an integrator. In December 2002, upon the acquisition of the licensing rights to certain intellectual property and patent pending technology from NetLabs, we shifted the focus of our business to developing and marketing our own suite of security products. Based upon our acquired licensing rights and additional research and development, we have developed various identification protection software products to protect computer networks from unauthorized access and to protect network owners and users from identity theft.

 

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We completed the development of our ProtectID® platform at the end of June 2006, we completed the core development of our keyboard encryption and anti-keylogger product, GuardedID®, in December 2006 and commenced deployment of our new mobile product, MobileTrust® into the mobile stores in 2014, of which the first two are currently being sold and distributed. ProtectID® patent titled "Multi-Channel Device Utilizing a Centralized Out-of-Band Authentication System" is now protected by three patents. The keystroke encryption technology we developed and use in our GuardedID® product is protected by three patents..

 

In November 2010, we received notice that the United States Patent and Trademark Office (“USPTO”) had issued an official Notice of Allowance for the patent application for the technology relating to our ProtectID® product. In January 2011, we received notice that the USPTO issued to us Patent No. 7,870,599. This “Out-of-Band” Patent went through a USPTO Re-Examination process starting on August 16, 2011 and concluded on December 27, 2011, with all of our patent claims remaining intact and eight additional patent claims being added. Since 2011, we submitted additional continuation patents on the “Out-of-Band” Patent, two additional patents granted and a fourth pending.

 

In January 2013, we were assigned the entire right, title and interest in the “Out-of-Band Patent” from NetLabs, with the agreement of the developer, and the assignment was recorded with the United States Patent and Trademark Office (“USPTO”).

 

In February 2013, we executed a retainer agreement with our patent attorneys to aggressively enforce our patent rights as “Out-of-Band Authentication” is becoming the standard for authenticating consumers in the financial market and for many Saas application users (e.g., SalesForce, etc.). In February 2013, our patent attorneys submitted a new “Out-of-Band” Patent continuation, which has been granted.

 

In March 2013, our patent attorneys submitted a new “Methods and Apparatus for securing user input in a mobile device” Patent, which is now patent pending. Our MobileTrust® product is the invention supporting the patent pending.

 

In July 2013, we received notice that the USPTO had added approximately sixty additional patent claims for our Out-of-Band patent we received in January 2011, by issuing to us Patent No. 8,484,698 thereby strengthening our position with clients and our current and potential lawsuits.

 

In October 2013, we received notice that the USPTO issued to us Patent No. 8,566,608 “Methods and apparatus for securing keystrokes from being intercepted between the keyboard and a browser.” This protects our GuardedID® product and the keystroke encryption portion of our MobileTrust® products.

 

In February 2014, we received a Notice of Allowance from the USPTO for our third patent relating to our "Multi-Channel Device Utilizing a Centralized Out-of-Band Authentication System" Patent No. 7,870,599. Upon receipt of this Out-of-Band patent we filed another continuation patent.

 

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In March 2014, we received Notice of Allowance from the USPTO for our second patent and first continuation of our Keystroke Encryption patent, which only furthers our protection for all mobile devices when utilizing any keyboard for data entry. Upon receipt of this Notice, we also filed another continuation patent for Patent No. 8,566,608.

 

In April 2014, we were granted our third patent relating to our “Multi-Channel Device Utilizing a Centralized Out-of-Band Authentication System” Patent No. 8,713,701.

 

In September 2014, we filed an International Patent for MobileTrust® (PCT/US20114/029905).

 

In March 2015, we received our third patent from the USPTO, Patent No. 8,973,107, of our Keystroke Encryption patent. This enhances our position for our Keystroke Encryption product, GuardedID®, and our MobileTrust® product.

 

Our suite of products is targeted to the financial, e-commerce, corporate, government, healthcare, legal, insurance, technology and retail sectors. We seek to locate customers in a variety of ways. These primarily include contracts with value added resellers and distributors (both inside the United States and internationally), direct sales calls initiated by our internal staff, exhibitions at security and technology trade shows, through the media, through consulting agreements, and through our agent relationships. Our sales generate revenue either as an Original Equipment Manufacturer (“OEM”) model, through a Hosting/License agreement, bundled with other company’s products or through direct purchase by distributors and resellers. We price our products for cloud consumer transactions based on the number of transactions in which our software products are utilized. We also price our products for business applications based on the number of users. These pricing models provide our company with one-time, monthly, quarterly and annual recurring revenues with volume discounts. We are also generating revenues from annual maintenance contracts, renewal fees and expect, but cannot guarantee, an increase in revenues based upon the execution of various agreements that we have recently closed and were implemented during the fourth quarter of 2014, primarily in the retail and insurance sectors.

 

We generated all of our revenues of $68,661 for the three months ended March 31, 2015, compared to $90,901 for the three months ended March 31, 2014, from the sales of our security products. The decrease in revenues was primarily due to the decrease in hardware sales, maintenance sales and revenue from sign on fees. We have realized delays in revenues from some of our new distributor’s that, although there can be no assurances, we anticipate will appear in the second quarter of 2015, and in delayed rollout of our new mobile security technologies, now anticipated to roll out through the Apple and Android markets during the second quarter of 2015. In addition, we rolled out our GuardedID® MAC version that is expected, but not guaranteed, to increase our revenues during the second quarter of 2015 and thereafter. Therefore, we see strong opportunities for increased sales through 2015. Additionally, we believe we have opportunities through our sales distribution channels, including current pilots, which we believe should increase revenues in 2015, especially with the addition of our new mobile security products and new multi-marketing partners.

 

We market our products globally to financial service firms, healthcare related companies, legal services companies, e-commerce companies, gaming, automotive, government agencies, multi-level marketing groups, the enterprise market in general, and with virtual private network companies, as well as technology service companies and retail distributors that service all the above markets. We seek such sales through our own direct efforts, through distributors, resellers and third party agents internationally. We are also seeking to license the technology as original equipment with computer hardware and software manufacturers. We are engaged in multiple production installations and pilot projects with various distributors, resellers and direct customers primarily in the United States. Our GuardedID® product is also being sold directly to consumers, primarily through the Internet as well as distributors, resellers, third party agents, affiliates and potential OEM agreements by bundling GuardedID® with their products (providing a value-add and competitive advantage to their own products and offerings). Currently this is the most active market for us with multiple programs in pre-production and some already in production. We anticipate, but cannot guarantee, increases in revenues in 2015 from these programs. In addition, we have completed the development and testing our new mobile products, MobileTrust® and GuardedID® Mobile Software Development Kit (SDK), which is almost completed and being prepared for sales in mobile online stores in, we expect but cannot guarantee, the second quarter of 2015, upon completion of our new sCloud registration process. The mobile products play a major role in our anticipated, but not guaranteed, second quarter 2015 revenue projections. Although no assurances can be provided that revenues will increase as anticipated, our GuardedID® MAC version, recently rolled out, is another reason for our anticipated, but not guaranteed, projected increase in revenues during the second quarter of 2015.

 

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We have incurred substantial losses since our inception. Our management believes that our products provide a cost-effective, more secure and technologically competitive solution to address the problems of cyber security and data breaches in general, especially when considering our new mobile applications. Considering recent public announcements by Symantec and other media sources that anti-virus solutions barely protect against the new malware threats, primarily keylogging malware, we contend that our keystroke encryption patented products are becoming more important, especially in the healthcare and retail markets. However, there can be no assurance that our products will continue to gain increased acceptance and continue to grow in the commercial and retail marketplaces or that one of our competitors will not introduce technically superior products.

 

Our executive office is located at 1090 King Georges Post Road, Suite 603, Edison, NJ 08837. Our telephone number is (732) 661-9641. We have 6 employees. Our Company’s website is www.strikeforcetech.com (we are not including the information contained in our website as part of, nor should the information be relied upon or incorporated by reference into, this report on Form 10-Q).

 

Business Model

 

We are focusing primarily on developing sales through “channel” relationships in which our products are offered by other manufacturers, distributors, value-added resellers and agents, internationally. In 2014, we added and publicly announced additions to our global distribution sales channel, which provides additional presence for us in the United States, Canada, Europe and Africa. We continue to add additional channel partners, especially on the consumer side. We also sell our suite of security products directly from our Edison, New Jersey office, which also augments our channel partner relationships. It is our strategy that these “channel” relationships will provide the greater percentage of our revenues ongoing, as was the case in the past two years. Examples of the channel relationships that we are seeking include already established original equipment manufacturer (“OEM”) and bundled relationships with other security technology and software providers that would integrate or bundle the enhanced security capabilities of ProtectID®, GuardedID® and/or MobileTrust® into their own product lines, thereby providing greater value to their clients. These would include providers of networking software and manufacturers of computer and telecommunications hardware and software that provide managed services, and multi-level marketing groups, as well as all markets interested in increasing the value of their products and packages, such as financial services software, anti-virus, government integrators and identity theft product companies. We signed various new distributors during the fourth quarter of 2014 and have optimistic expectations for 2015, resulting from these distribution relationships. There is no guarantee as to the timing and success of these business relationships.

 

From our MobileTrust® security new mobile application, which is now completed and with our sCloud registration process in production, we have created and announced two new products: our new ProtectID® Mobile OTP (One Time Password) to be used with ProtectID®; and our new GuardedID® Mobile keystroke encryption software development kit (SDK). We anticipate, but can provide no assurances, that both new products will be in production during the second quarter of 2015. With the creation of this new GuardedID® Mobile SDK, we intend to focus the sales of this software product to the development groups of our target markets to be added to their mobile applications. Management has already received requests for this software, including for mobile devices, as keystroke encryption malware continues to grow and remain a major problem for the cyber security market. Particularly, in management’s estimation, with anti-virus products being seen as non-effective against malware threats.

  

Our primary target markets include financial services such as banks and insurance companies, healthcare providers, legal services, government agencies through integrators, technology platforms, e-commerce based services companies, telecommunications and cellular carriers, technology software companies, government agencies and consumers, especially for our mobile and keystroke encryptions products. We are focusing our concentration on cyber security and data breach strategic problem areas, such as where compliance with financial, healthcare, legal and government regulations are key and stolen passwords are used to acquire private information illegally. We executed a multi-year contract with a healthcare facility who utilizes our ProtectID® solution for its employees and administrators. The contract became revenue producing in the first quarter of 2012 for a three year auto-renewable term and is still in effect. During the second half of 2012, we signed on additional distributors and resellers from which we started to generate revenues in 2013 and 2014, as they commenced implementing their sales strategies for our products. In the fourth quarter of 2014, a number of our channel partners had pilots and client implementations in place that are expected, although no assurances can be provided, to increase our revenues in 2015. With our mobile products commencing production in the second quarter of 2015, we anticipate, but cannot guarantee, increased revenues in 2015. There is no guarantee as to the timing and success of these efforts.

 

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Because we are now experiencing a continual, recurring growing market demand, especially in the mobility and encryption markets, we continue to develop an increasing global reseller and distribution channel as a strategy to generate, manage and fulfill demand for our products across market segments, minimizing the requirement for an increase in our staff. We continue to minimize the concentration on our initial direct sales efforts as our distribution and reseller channels continue to grow internationally and provide appropriate levels of sales and support in the growing Cyber Security market.

 

We seek to generate revenue through fees for ProtectID® based on client consumer usage in the financial, healthcare services and legal services markets, as well as enterprises in general, through our Cloud Service, plus one-time and annual per person fees in the enterprise markets which often are for in-house installations of our products, and set-up and recurring transaction fees when the product is accessed in our Cloud Service, along with annual maintenance fees, and other one-time and recurring fees. We also intend to generate revenues through sales of our GuardedID® product. GuardedID® pricing is for an annual license and we discount for volume purchases. GuardedID® pricing models, especially when bundling through OEM contracts, include monthly and quarterly recurring revenues. As more agreements are reached by our distributors, we are experiencing monthly increasing sales growth, through the execution of GuardedID® bundled OEM agreements. We also provide our clients a choice of operating our ProtectID® software internally by licensing it or through our hosted Cloud Service or a hybrid that some clients have implemented and none of our competitors presently offer. GuardedID® requires a download on each and every computer it protects, whether for employees or consumers. We have four GuardedID® products, (i) a standard version which protects browser data entry only, (ii) a premium version which protects almost all the applications running under Microsoft Windows on the desktop, including Microsoft Office Suite and almost all applications running on the desktop, (iii) an Enterprise version which, in addition, provides the Enterprise administrative rights and the use of Microsoft’s Enterprise tools for the product’s deployment, and (iv) an Apple MAC version for all the latest MAC operating systems and for the browsers and entire desktop. Our MobileTrust® mobile product will be priced for the consumer through the appropriate mobile phone stores, as well as direct, distribution and OEM sales for higher volume enterprises, including volume discounts to the degree allowed by the telecommunications providers. Our GuardedID® Mobile SDK (software development kit) will be priced on an annual recurring fee based on volume and number of users or an enterprise plus maintenance price. We anticipate, but can provide no assurances, that these new product offerings will result in the largest number of sales and related revenues for us in fiscal 2015.

 

Our management believes that our products provide a cost-effective and technologically competitive solution to address the increasing problems of network security and cyber security in general. Updated guidance for the Federal Financial Institutions Examination Council (“FFIEC”) regulations include the requirement for solutions that have Two-Factor Out-of-Band Authentication and products that stop keylogging malware, real time, which our management believes our proprietary products uniquely and directly address. This new updated guidance went into effect as of January 1, 2012. Additionally, the 2014 Verizon Data Breach report, published in April 2015, stated that 80% of all the data breaches they reported would not have occurred if the corporations used two factor authentication, such as our ProtectID® system. The report also indicates that over 79% of the data breaches would most likely not have occurred if the corporations breached used anti-keylogging software, such as our GuardedID® system in addition to the typical anti-virus programs. Based on the FFIEC requirement in the latest FFIEC update that was published in June 2011 (being enforced as of January 2012) the latest Verizon Data Breach Report and the new articles from the White House urging law firms and legal services firms to add two factor authentication, we have recently experienced a growing increase in pilots and sales orders and inquiries specifically in the financial and legal markets. In January 2014, PCI Compliance published an update that includes the requirement for not only encrypting data at rest, but also to encrypt data in motion including the keystrokes users enter in their device. Additionally, Symantec's senior vice-president for information security, Brian Dye, told the Wall Street Journal that anti-virus "is dead", in an article published in May 2014. However, there can be no assurance that our products will continue to gain acceptance and continue to grow in the commercial marketplace or that one of our competitors will not introduce technically superior products.

 

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Marketing

 

Our multi-channel marketing strategy includes:

 

1. Direct sales to enterprise and commercial customers. In this effort, we attend the RSA Security Show annually as well as other security related shows and we are looking at other inside sales alternatives in order to respond aggressively to inquiries relating to our products.

 

2. The global addition of resellers, agents & distributors (our strategic sales channel) who distribute and resell our products and services to enterprise and commercial customers globally (technology and software product distributors, systems integrators, managed service companies, other security technology and software vendors, telecom companies, identity theft related product companies, etc.).

   

3. Application Service Provider (ASP) Partners: Our certified SAS 70 third party service provides a hosting platform that facilitates faster implementations at competitive prices for our Cloud Service option.

 

4. Original Equipment Manufacturers (OEM): SFT products are sold to other security technology vendors that integrate ProtectID® and GuardedID® and now GuardedID® Mobile SDK into their products (bundling) and services providing for monthly/annual increasing recurring revenues or other models as the SDK is intended to enter the market during the second quarter of 2015.

 

5. Internet sites that sell GuardedID® to consumers and small enterprises, such as affiliates.

 

6. Technology and other providers and resellers, agents and distributors interested in purchasing and or selling our new MobileTrust® cyber solution for all mobile devices, initially for all Apple and Android devices, that we intend to be in production during the second quarter of 2015.

 

7. Outside Independent consultants selling our products for commission only, focusing on the healthcare, legal and consumer markets.

 

Our sCloud service provider is Hosting.com and we have been under contract with them since December 2007 when we executed an agreement with a nationwide premier data center and co-location services provider who functions as an Application Service Provider for our ProtectID® and GuardedID® products, which require a secondary server used for the “Out-of-Band” two-factor authentication technology. We believe that this relationship improves the implementation time, reduces the cost and training requirements, and allows for ease of scalability, with hot backups in multiple locations across the U.S., on an as needed basis. Our sCloud site is also SAS 70 (Statement on Auditing Standards (SAS) No. 70) certified, which is critical to providing a secure compliant service that is required by most of our clients. Our agreement with the services provider was for a one-year (1) term, initially ending in December 2008 and renewing automatically for one-year (1) terms, and is still in effect. The relationship can be terminated by either party on sixty days written notice. The cloud service is based on a flat monthly fee per the terms of the contract that can increase as we require additional services.

 

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Intellectual Property

 

We are working with our patent attorneys to aggressively enforce our patent rights per the terms of a retainer agreement executed in February 2013. Our patent attorneys also filed our fourth “Out of Band” continuation patents. The third patent was recently granted and the fourth patent is pending. We currently have three patents granted to us for Out-of-Band ProtectID® (Patent Nos.: 7,870,599, 8,484,698 and 8,713,701). In September 2014, we filed an International Patent for MobileTrust® (PCT/US20114/029905), which is pending.

 

We are also working with our patent attorneys to plan our strategy to aggressively enforce our patent rights relating to our granted Keystroke Encryption patents that help protect our GuardedID® and MobileTrust® products. We were granted our first related keystroke encryption patent and were granted our second keystroke encryption patent for GuardedID®. Our patent attorneys also filed a third Keystroke Encryption patent, which we received on March 3, 2015 (Patent Nos.: 8,566,608, 8,732,483 and 8,973,107).

 

We have four trademarks that have been approved and registered: ProtectID®, GuardedID®, MobileTrust® and CryptoColor®. A portion of our software is licensed from third parties and the remainder is developed by our own team of developers while leveraging some external consultant expertise as necessitated. We rely upon confidentiality agreements signed by our employees, consultants and third parties to protect the intellectual property rights.

 

We license technology from third parties, including software that is integrated with internally developed software and used in our products to perform key functions. We anticipate that we will continue to license technology from third parties in the future. Although we are not substantially dependent on any individual licensed technology, some of the software that we license from third parties could be difficult for us to replace. The effective implementation of our products depends upon the successful operation of third-party licensed products in conjunction with our suite of products, and therefore any undetected errors in these licensed products could create delays in the implementation of our products, impair the functionality of our products, delay new product introductions, damage our reputation, and/or cause us to provide substitute products.

   

Business Strategy

 

We could incur significant additional costs before we become profitable. Most of the costs that we incur are related to salaries, professional fees, marketing, sales and research & design. We have increased our sales efforts by retaining a consultant, and we have increased our technology staff by contracting an outsourced firm. Our operations presently require funding of approximately $110,000 per month. We expect that our monthly cash usage for operations will increase slightly due to contracted and anticipated increased volumes and adding some targeted marketing programs. We anticipate that the areas in which we will experience the greatest increase in operating expenses is in marketing, selling, product support, product research and new technology development in the growing cyber security market. We are committed to maintaining our current level of operating costs until we reach the level of revenues needed to absorb any potential increase in costs.

 

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Our primary strategy throughout 2015 is to focus on the growth and support of our channel partners, including distributors, resellers and original equipment manufacturers (OEMs). Our internal sales team targets potential direct sales in industries that management believes provides the greatest potential for short term sales. These include small to medium sized financial institutions, government agencies, e-commerce, healthcare, legal and enterprise businesses. We are also executing agreements with strategic resellers and distributors for marketing, selling and supporting our products internationally. We primarily work with distributors, resellers and agents to generate the bulk of our sales internationally, realizing that this strategy takes longer to nurture, however it is progressing well. We are starting to realize positive results, however slowly, with our sales channel and anticipate, but cannot guarantee, a very successful 2015 through the sales channel and from our new mobile and GuardedID® MAC products with a concentration of sales already contracted. There can be no assurances, however, that we will succeed in implementing our sales strategy. Although management believes that there is an increasingly strong market for our products as the need for cyber security solutions increases globally, we have not generated substantial revenue from the sale of our products and there is no assurance we can secure a market sufficient to permit us to achieve profitability in the next twelve months.

 

Competition

 

The software development and services market is characterized by innovation and competition. There are several well-established companies within the authentication market that offer network security systems in our product market and newer companies with emerging technologies. We believe that our multi-patented “Out-of-Band” multi-factor identity authentication platform is an innovative, secure, adaptable, competitively priced, integrated network authentication platform. The main features of ProtectID® include: an open architecture “Out-of-Band” platform for user authentication; operating system independence; biometric layering; mobile authentication; secure website logon; Virtual Private Network (“VPN”) access; domain authentication; newly added Office 365 authentication and multi-level authentication. Unlike other techniques for increased network security, ProtectID® does not rely on a specific authentication device or method (e.g., phone, tokens, smart cards, digital certificates or biometrics, such as a retinal or fingerprint scan). Rather ProtectID® has been developed as an “open platform” that incorporates an unlimited number of authentication devices and methods. For example, once a user has been identified to a computer network, a system deploying our ProtectID® authentication system permits the “Out-of-Band” authentication of that user by a telephone, iPhone, iPad, Blackberry, PDA, email, hard token, SSL client software, a biometric device such as a voice biometric, or others, before that user is permitted to access the network. By using “Out-of-Band” authentication methods, management believes that ProtectID®, now patented and protected through our ongoing litigation, with plans for additional litigation, provides a competitive product for customers with security requirements greater than typical name and password schemes for virtual private networks and computer systems with multiple users at remote locations, as examples. We also believe that our multi-patented keystroke encryption product, GuardedID®, offers an additional competitive edge for network security and e-commerce applications that should provide greater levels of security and the ability to evolve over time based on newer technologies when made available. There is less competition for the keystroke encryption product and there are no well-established companies in this space, which explains our current growth in pilots and sales for GuardedID®, especially relating to bundled channel partner programs. GuardedID® is critical to help prevent key logging viruses, one of the largest sources of cyber-attacks and data breaches. GuardedID® also is protected with two patents and one pending. Our newest product, MobileTrust®, is ideal for bringing the functionality of our other two products, especially including keystroke encryption, to all mobile devices, with initial focus on all Apple and Android devices. This product is also protected with our GuardedID® patents and some of its features and functions are covered by the Out-of-Band Authentication patent. Our other new mobile product is GuardedID® Mobile SDK, which allows our secured keyboard function as a software development kit for developers to purchase and integrate as part of their secured applications. Considering the features and functions, all of our cyber solutions have limited competition based on our products’ ability to protect individual identities and computers/devices against some of the most dangerous and increasing threats. We also have great demand for the mobile products, which are being marketed to all potential new clients.

 

Although we believe that our suite of products offer competitive advantages, there is no assurance that any of these products will continue to increase its market share in the marketplace. Our competitors include established software and hardware companies that are likely to be better financed and to have established sales channels. Due to the high level of innovation in the software development industry, it is also possible that a competitor will introduce a product that provides a higher level of security than our products or which can be offered at prices that are more advantageous to the customer.

 

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DESCRIPTION OF PROPERTY

 

We operate from leased offices located at 1090 King Georges Post Road, Suite #603, Edison, New Jersey 08837. We do not hold any material investments in other real or personal property other than office equipment. We anticipate these facilities will be adequate for the immediate future but that if we are successful in introducing our products, we will need to seek larger or additional office quarters. We pay a monthly base rent of $3,807 which commenced on July 1, 2009 through the extended lease termination date of January 31, 2016. The lease does not contain a renewal option and requires us to pay costs such as maintenance and insurance.

 

MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION

 

Management's Discussion and Analysis of Financial Condition is based upon our financial statements, which have been prepared in accordance with accounting principles generally accepted in the United States of America. When preparing our financial statements, we 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, along with the amounts of revenues and expenses during the reported period. Significant estimates include, but are not limited to, the estimated useful lives of property and equipment and website development costs. Actual results could differ from those estimates.

 

Results of Operations

 

FOR THE THREE MONTHS ENDED MARCH 31, 2015 COMPARED TO THE THREE MONTHS ENDED MARCH 31, 2014

 

Revenues for the three months ended March 31, 2015 were $68,661 compared to $90,901 for the three months ended March 31, 2014, a decrease of $22,240 or 24.5%. The decrease in revenues was primarily due to the decrease in hardware sales, maintenance sales and revenue from sign on fees We have experienced delays in realizing anticipated revenues from some of our new distributor’s clients, and in delayed rollout of our new mobile security technologies. We have opportunities, through our sales channels, including current pilots, that we expect, but cannot guarantee will increase revenues in fiscal 2015. We anticipate revenues will increase during the second half 2015 as we rollout MobileTrust®, and GuardedID® Mac enterprise edition by mid-2015.

 

Revenues generated consisted of hardware and software sales, services and maintenance sales, revenue from sign on fees, and recurring transaction revenues. Hardware sales for the three months ended March 31, 2015 were $0 compared to $6,068 for the three months ended March 31, 2014, a decrease of $6,068. The decrease in hardware revenues was primarily due to the decrease in our sales of our one-time-password token key-fobs. Software, services and maintenance sales for the three months ended March 31, 2015 were $68,661 compared to $84,833 for the three months ended March 31, 2014, a decrease of $16,172. The decrease in software, services and maintenance revenues was primarily due to the decrease in maintenance sales and revenue from sign on fees.

 

Cost of revenues for the three months ended March 31, 2015 was $736 compared to $6,879 for the three months ended March 31, 2014, a decrease of $6,143, or 89.3%. The decrease resulted primarily from the decrease in processing fees relating to our ProtectID® product and due to the decrease in our sales of our one-time-password token key-fobs. Cost of revenues as a percentage of total revenues for the three months ended March 31, 2015 was 0.3% compared to 7.6% for the three months ended March 31, 2014. The decrease resulted primarily from the increase in our revenues and the decrease in our cost of revenues.

 

Gross profit for the three months ended March 31, 2015 was $67,925 compared to $84,022 for the three months ended March 31, 2014, a decrease of $16,097, or 19.2%. The decrease in gross profit was primarily due to the decrease in our revenues.

 

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Research and development expenses for the three months ended March 31, 2015 were $62,277 compared to $83,200 for the three months ended March 31, 2014, a decrease of $20,923, or 25.2%. The decrease in research and development expenses was primarily due to the elimination of one staff member through attrition. The salaries, benefits and overhead costs of personnel conducting research and development of our software products comprise research and development expenses.

 

Selling, general and administrative (“SGA”) expenses for the three months ended March 31, 2015 were $303,173 compared to $329,314 for the three months ended March 31, 2014, a decrease of $26,141 or 7.9%. The decrease was due primarily to the decrease in trade show fees and health insurance we expensed in the quarter. Selling, general and administrative expenses consist primarily of salaries, benefits and overhead costs for executive and administrative personnel, insurance, fees for professional services, including consulting, legal, and accounting fees, plus travel costs and non-cash stock compensation expense for the issuance of stock to non-employees and other general corporate expenses.

   

Other income (expense) for the three months ended March 31, 2015 was other income of $748,824 as compared to other expense of ($422,029) for the three months ended March 31, 2014, representing an increase in other income of $1,170,853, or 277%. The increase was primarily due to the settlement of a lawsuit with one of our channel partners, WhiteSky, Inc. ("WhiteSky") which was settled on March 9, 2015 with mutually agreed upon terms and due to a decrease in changes in fair value of derivative liabilities and a decrease in interest expense.

 

Our net income (loss) for the three months ended March 31, 2015 was $451,299 compared to a net loss of ($750,521) for the three months ended March 31, 2014, an increase in net income of $1,201,820, or 160%. The increase in our net income was due primarily to the increase in other income caused by the settlement of the WhiteSky lawsuit, decreases in the change in fair value of derivative liabilities and a decrease in interest expense.

 

Liquidity and Capital Resources

 

Our total current assets at March 31, 2015 were $297,543, which included cash of $25,968, as compared with $70,424 in total current assets at December 31, 2014, which included cash of $13,129. Additionally, we had a stockholders’ deficit in the amount of $11,561,618 at March 31, 2015 compared to a stockholders’ deficit of $12,199,060 at December 31, 2014. We have historically incurred recurring losses and have financed our operations through loans, principally from affiliated parties such as our directors, and from the proceeds of debt and equity financing. The liabilities include a computed liability for the fair value of derivatives of $887,499, which will only be realized on the conversion of the derivatives, or settlement of the debentures.

 

We financed our operations during the three months ended March 31, 2015 primarily through the issuance of debt in the aggregate amount of $261,875 and through recurring revenues from our ProtectID® and GuardedID® technologies in the aggregate amount of $68,661. Management anticipates that we will continue to rely on equity and debt financing, at least for 2015 and early 2016, to finance our operations. While management believes that there will be a substantial percentage of our sales generated from our GuardedID® and new mobile products and there are an increasing number of customers for our patented ProtectID® product, we will continue to have customer concentrations. Inherently, as time progresses and corporate exposure in the market continues to grow, with increasing marketing efforts, management believes, but cannot guarantee, we will continue to attain greater numbers of customers and the concentrations could decrease over time and we project, but cannot guarantee, to be cash flow positive by the end of 2015. Until this is accomplished, management will continue to attempt to secure additional financing through both the public and private market sectors to meet our continuing commitments of expenditures and until our sales revenue can provide greater liquidity.

 

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Our number of common shares outstanding increased from 2,453,522 shares at the year ended December 31, 2014 to 21,842,876 at the three months ended March 31, 2015, an increase of 790%. The increase in the number of common shares outstanding was due to common shares issued related to the issuance, conversion and settlement of debt, the exercise of warrant agreements, or equity financing and consulting obligations, which, consequently, helped to reduce our outstanding debentures.

 

Our number of shares of Series B Preferred Stock issued and outstanding remained unchanged at 142,004 shares at the year ended December 31, 2014 and at the three months ended March 31, 2015.

 

We have historically incurred losses and our operations presently require funding of approximately $110,000 per month. Management believes, but cannot provide assurances, that we will be cash flow positive by the end of 2015, based on recently executed and announced contracts and potential contracts that we anticipate closing throughout 2015 in the financial industry, technology, insurance, enterprise, healthcare, government, legal, and consumer sectors in the United States, Latin America, Europe, Africa and the Pacific Rim. There can be no assurance, however, that the sales anticipated will materialize or that we will achieve the profitability we have forecasted. Management also recognizes the consequences of current world economic developments and the possible volatile effect on currency rates resulting from revenues derived from foreign markets.

   

Changes in Authorized Shares

 

In February 2014, a 1:1,500 reverse stock split of our issued and outstanding shares of common stock was ratified, effective upon the filing of an amendment to our Certificate of Incorporation with the Wyoming Secretary of State. The amendment was adopted in March 2014.

 

All shares and per share amounts in the financial statements have been adjusted to give retroactive effect to the 1:1,500 reverse stock split adopted in March 2014 and subsequent reverse stock splits.

 

In February 2014, a decrease of the authorized shares of our common stock from six billion seven hundred fifty million (6,750,000,000) to one billion, five hundred million (1,500,000,000), $0.0001 par value, was ratified, effective upon the filing of an amendment to our Certificate of Incorporation with the Wyoming Secretary of State. The amendment was adopted in March 2014.

 

In December 2014, an increase of the authorized shares of our common stock from one billion, five hundred million (1,500,000,000) to nine billion (9,000,000,000), $0.0001 par value, was ratified, effective upon the filing of an amendment to our Certificate of Incorporation with the Wyoming Secretary of State. The amendment was adopted in December 2014.

 

In December 2014, a 1:650 reverse stock split of our issued and outstanding shares of common stock was ratified, effective upon the filing of an amendment to our Certificate of Incorporation with the Wyoming Secretary of State. The amendment was adopted in January 2015.

 

All shares and per share amounts in the financial statements have been adjusted to give retroactive effect to the 1:650 reverse stock split adopted in January 2015.

 

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In December 2014, a decrease of the authorized shares of our common stock from nine billion (9,000,000,000) to three billion (3,000,000,000), $0.0001 par value, was ratified, effective upon the filing of an amendment to our Certificate of Incorporation with the Wyoming Secretary of State. The amendment was adopted in January 2015.

 

Preferred Stock

 

On October 21, 2010, we amended our Articles of Incorporation in New Jersey to authorize 10,000,000 shares of preferred stock, par value $0.10. The designations, rights, and preferences of such preferred stock are to be determined by the Board of Directors. On November 15, 2010, we changed our domicile from the state of New Jersey to the state of Wyoming.

 

In addition to the 10,000,000 shares of preferred stock authorized, on January 10, 2011, 100 shares of preferred stock were designated as Series A Preferred Stock and 100,000,000 shares were designated as Series B Preferred Stock. The bylaws under the Wyoming Incorporation were amended to reflect the rights and preferences of each additional new designation.

 

The Series A Preferred Stock collectively has voting rights equal to eighty percent of the total current issued and outstanding shares of common stock. If at least one share of Series A Preferred Stock is outstanding, the aggregate shares of Series A Preferred Stock shall have voting rights equal to the number of shares of common stock equal to four times the sum of the total number of shares of common stock issued and outstanding, plus the number of shares of Series B Preferred Stock (or other designated preferred stock) which are issued and outstanding.

   

In February 2011, we issued three shares of non-convertible Series A preferred stock valued at $329,000 per share, or $987,000 in aggregate, for voting purposes only, to the three members of our management team at one share each. The issued and outstanding shares of the Series A preferred stock have voting rights equal to eighty percent of the total issued and outstanding shares of the our common stock. This effectively provided them, upon retention of their Series A Preferred Stock, voting control on matters presented to our shareholders. They have each irrevocably waived their conversion rights relating to the Series A preferred shares issued.

 

The Series B Preferred Stock have preferential liquidation rights in the event of any liquidation, dissolution or winding up of the Company, such liquidation rights to be paid from our assets not delegated to parties with greater priority at $1.00 per share or, in the event an aggregate subscription by a single subscriber of the Series B Preferred Stock is greater than $100,000,000, $0.997 per share. The Series B Preferred Stock shall be convertible to a number of shares of common stock equal to the price of the Series B Preferred Stock divided by the par value of the Series B Preferred Stock, par value $0.10. The option to convert the shares of Series B Preferred Stock may not be exercised until three months following the issuance of the Series B Preferred Stock to the recipient shareholder. The Series B Preferred Stock has ten votes on matters presented to our shareholders for one share of Series B Preferred Stock held.

 

In February 2014, our Board of Directors amended the conversion feature of the Series B Preferred Stock, to permit conversion to common shares at a 40% market discount to current market value at the time we receive a conversion request. Current market value is defined as the average of the immediately prior five trading day's closing prices. Additionally, when Series B Preferred Stock shares convert to our common stock, the minimum price discount floor level is set at $0.005, as decided by our Board of Directors. As of December 31, 2014, there were 142,004 shares of Series B Preferred Stock issued and outstanding.

 

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All of the above offerings and sales, except the afore-mentioned shares issued pursuant to a conversion of convertible notes, were made in reliance upon the exemption from registration under Rule 506 of Regulation D promulgated under the Securities Act of 1933 and/or Section 4(2) of the Securities Act of 1933, based on the following: (a) the investors confirmed to us that they were “accredited investors,” as defined in Rule 501 of Regulation D promulgated under the Securities Act of 1933 and had such background, education and experience in financial and business matters as to be able to evaluate the merits and risks of an investment in the securities; (b) there was no public offering or general solicitation with respect to the offering; (c) the investors were provided with certain disclosure materials and all other information requested with respect to our company; (d) where applicable, the investors acknowledged that all securities being purchased were “restricted securities” for purposes of the Securities Act of 1933, and agreed to transfer such securities only in a transaction registered under the Securities Act of 1933 or exempt from registration under the Securities Act; and (e) where applicable, a legend was placed on the certificates representing each such security stating that it was restricted and could only be transferred if subsequent registered under the Securities Act of 1933or transferred in a transaction exempt from registration under the Securities Act of 1933.

 

SUMMARY OF OUR OUTSTANDING DART SECURED CONVERTIBLE DEBENTURES

 

At March 31, 2015, $542,588 in aggregate principal amount of the DART Limited ("DART"), custodian for Citco Global Custody NV (“Citco Global”) as of July 2012, debentures, as assigned by YA Global and Highgate in April 2009, were issued and outstanding.

 

During the three months ended March 31, 2015, DART had no conversions.

 

The DART secured convertible debentures are fully matured. We have been in contact with the note holder who has indicated that it has no present intention of exercising its right to convert the debentures into restricted shares of our common stock. The note holder has advised us that it currently is willing to wait until it receives a buyout offer from us.

 

SUMMARY OF OUR OUTSTANDING SECURED DEBENTURE

 

In May 2015, per the terms of a Security Agreement, we executed a secured promissory note with an unrelated party for $310,000, bearing interest at 10% per annum maturing in equal thirds on March 31, 2016, March 31, 2017 and March 31, 2018. We received tranche one in February 2015, for $100,000, and tranche two in March 2015, for $75,000. The remaining funds were received in April 2015 in four tranches for a total of $135,000.

 

As inducement to make the loan, the note holder received 16,667 shares of our Series B preferred stock at $1.50 per share, in May 2015, that are convertible into shares of our common stock at a 30% discount to current market value, defined as the average of the immediately prior five trading day's closing prices upon receipt of a conversion notice. The Series B preferred shares can be converted at any time after six months from the date of issuance, but only once every 30 days. The conversion feature contains an embedded derivative.

 

At March 31, 2015, our outstanding secured notes payable are secured through the note holder's first position claim on our intellectual property, accounts, fixtures and property.

 

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SUMMARY OF FUNDED DEBT TRANSACTIONS FOR THE INTERIM PERIOD ENDED MARCH 31, 2015

 

During the three months ended March 31, 2015, we issued unsecured convertible notes in an aggregate total of $67,000 to two unrelated parties pursuant to the terms and conditions of term sheets executed with investor firms at various times during 2014. Additionally, during the three months ended March 31, 2015, we settled and transferred $25,000 of unsecured note balances to one unrelated party in the form of a convertible note for $25,000. Additionally, during the three months ended March 31, 2015, twelve investor firms converted $77,741 of convertible notes, and $1,419 of accrued interest, into 19,189,054 shares of our common stock, as adjusted by our 1:650 reverse stock split, pursuant to an exemption provided under Rule 144 of the Securities Act of 1933. The conversion prices ranged from $0.0004 per share to $0.039 per share, as adjusted by our 1:650 reverse stock split.

 

During the three months ended March 31, 2015, we issued an unsecured note in an aggregate total of $19,875 to one related party.

 

Summary of Funded Debt

 

As of March 31, 2015, our company’s open secured note balances were $175,000, listed as follows:

 

·

$175,000 to an unrelated company - current portion = $58,333; long term portion = $116,667

 

As of March 31, 2015, our company’s open unsecured promissory note balance was $1,872,500, listed as follows:

 

	·	$50,000 to an unrelated individual - current term portion
	·	$210,000 to an unrelated company - current portion
	·	$1,475,000 to twenty unrelated individuals through term sheet with the StrikeForce Investor Group - current portion
	·	$137,500 to an unrelated company - current portion

 

As of March 31, 2015, our company’s open unsecured related party promissory note balances were $742,513, listed as follows:

 

	·	$722,638 to our CEO - current portion
	·	$19,875 to our CEO - long term portion

 

As of March 31, 2015, our company’s open convertible secured note balances were $542,588, listed as follows:

 

·

$542,588 to DART (custodian for Citco Global and as assigned in 04/09 by YA Global and Highgate House Funds, Ltd.)

 

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As of March 31, 2015, our company’s open convertible note balances were $1,011,237, net of discount on convertible notes of $908,702, listed as follows (month/year):

 

	·	$235,000 to an unrelated company (03/05 unsecured debenture) - current portion
	·	$7,000 to an unrelated company (06/05 unsecured debenture) - current portion
	·	$10,000 to an unrelated individual (06/05 unsecured debenture) - current portion
	·	$40,000 to three unrelated individuals (07/05 unsecured debentures) - current portion
	·	$5,000 to an unrelated individual (09/05 unsecured debenture) - current portion
	·	$10,000 to an unrelated individual (12/05 unsecured debenture) - current portion
	·	$30,000 to an unrelated individual (06/06 unsecured debenture) - current portion
	·	$70,000 to an unrelated individual (09/06 unsecured debenture) - current portion
	·	$3,512 to an unrelated individual (02/07 unsecured debenture) - current portion
	·	$100,000 to an unrelated individual (05/07 unsecured debenture) - current portion
	·	$100,000 to an unrelated individual (06/07 unsecured debentures) - current portion
	·	$100,000 to an unrelated individual (07/07 unsecured debenture) - current portion

  

	·	$120,000 to three unrelated individuals (08/07 unsecured debentures) - current portion
	·	$50,000 to two unrelated individuals (12/09 unsecured debentures) - current portion
	·	$30,000 to an unrelated company (03/10 unsecured debenture) - current portion
	·	$103,387 to an unrelated company (01/12 unsecured debentures) - current portion
	·	$75,000 to an unrelated company (03/12 unsecured debenture) - current portion
	·	$36,500 to an unrelated company (11/13 unsecured debenture) - current portion
	·	$50,000 to an unrelated company (12/13 unsecured debenture) - current portion
	·	$40,000 to an unrelated company (12/13 unsecured debenture) - current portion
	·	$90,675 to an unrelated company (03/14 unsecured debenture) - current portion
	·	$6,515 to an unrelated company (03/14 unsecured debenture) - current portion
	·	$26,250 to an unrelated company (04/14 unsecured debenture) - current portion
	·	$11,783 to an unrelated company (04/14 unsecured debenture) - current portion
	·	$9,790 to an unrelated company (04/14 unsecured debenture) - current portion
	·	$28,505 to an unrelated company (04/14 unsecured debenture) - current portion
	·	$22,011 to an unrelated company (05/14 unsecured debenture) - current portion
	·	$17,836 to an unrelated company (05/14 unsecured debenture) - current portion
	·	$32,500 to an unrelated company (05/14 unsecured debenture) - current portion
	·	$93,218 to an unrelated company (05/14 unsecured debenture) - current portion
	·	$59,765 to an unrelated company (06/14 unsecured debenture) - current portion
	·	$42,000 to an unrelated company (07/14 unsecured debenture) - current portion
	·	$34,500 to an unrelated company (08/14 unsecured debenture) - current portion
	·	$27,750 to an unrelated company (10/14 unsecured debenture) - current portion
	·	$26,250 to an unrelated company (10/14 unsecured debenture) - current portion
	·	$78,750 to an unrelated company (10/14 unsecured debenture) - current portion
	·	$13,620 to an unrelated company (10/14 unsecured debenture) - current portion
	·	$15,822 to an unrelated company (02/15 unsecured debenture) - current portion
	·	$25,000 to an unrelated company (02/15 unsecured debenture) - current portion
	·	$42,000 to an unrelated company (02/15 unsecured debenture) - current portion

  

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As of March 31, 2015, our company’s open convertible note balances - related parties were $355,500, listed as follows:

 

	·	$268,000 to our CEO - current portion
	·	$57,500 to our VP of Technical Services - current portion
	·	$30,000 to a relative of our CTO & one of our Software Developers - current portion

 

Based on present revenues and expenses, we are unable to generate sufficient funds internally to sustain our current operations. We must raise additional capital or determine other borrowing sources to continue our operations. It is management’s plan to seek additional funding through the sale of Common and Series B Preferred Stock, the sale and settlement of trade payables and debentures, and the issuance of notes and debentures, including notes and debentures convertible into common stock. If we issue additional shares of common stock, the value of shares of existing stockholders is likely to be diluted.

 

However, the terms of the convertible secured debentures issued to certain of the existing stockholders require that we obtain the consent of such stockholders prior to our entering into subsequent financing arrangements. No assurance can be given that we will be able to obtain additional financing on terms that are favorable to us or that the holders of the secured debentures will provide their consent to permit us to enter into subsequent financing arrangements.

 

Our future revenues and profits, if any, will primarily depend upon our ability, and that of our distributors and resellers, to secure sales of our suite of network security and anti-malware products. We do not presently generate significant revenue from the sales of our products. Although management believes that our products are competitive for customers seeking a high level of network security, we cannot forecast with any reasonable certainty whether our products will gain acceptance in the marketplace and if so by when.

 

Except for the limitations imposed upon us respective to the convertible secured debentures of DART (custodian for Citco Global and as assigned by YA Global and Highgate House Funds, Ltd.), there are no material or known trends that will restrict either short term or long-term liquidity.

 

Off-Balance Sheet Arrangements

 

We do not have any off balance sheet arrangements that are reasonably likely to have a current or future effect on our financial condition, revenues, result of operations, liquidity or capital expenditures.

 

Going Concern

 

The Report of Our Independent Registered Public Accounting Firm Contains Explanatory Language That Substantial Doubt Exists About Our Ability To Continue As A Going Concern

 

We have elected to adopt early application of Accounting Standards Update No. 2014-15, “Presentation of Financial Statements—Going Concern (Subtopic 205-40): Disclosure of Uncertainties about an Entity’s Ability to Continue as a Going Concern (“ASU 2014-15”).

 

The accompanying unaudited financial statements have been prepared assuming that we will continue as a going concern, which contemplates continuity of operations, realization of assets, and liquidation of liabilities in the normal course of business.

 

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As reflected in the accompanying unaudited financial statements, we had a working capital deficiency of $11,647,705 and deficit in stockholders’ equity of $11,561,618 at March 31, 2015 and a net income of $451,299 and net cash used in operating activities of $249,036 for the three months ended March 31, 2015. These factors raise substantial doubt about our ability to continue as a going concern.

 

Currently, management is attempting to increase revenues. In principle, we are focusing on domestic and international channel sales, where we are primarily selling through our well-developed sales channel including Distributors, Value Added Resellers, Strategic Partners and Original Equipment Manufacturers. While we believe in the viability of our strategy to increase revenues and in our ability to raise additional funds, there can be no assurances to that effect. Our ability to continue as a going concern is dependent upon our ability to continually increase our customer base and realize increased revenues from recently signed contracts.

 

The financial statements do not include any adjustments related to the recoverability and classification of recorded asset amounts or the amounts and classification of liabilities that might be necessary should we be unable to continue as a going concern.

   

Critical Accounting Policies

 

In accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”), we record certain assets at the lower of cost or fair market value. In determining the fair value of certain of our assets, we must make judgments, estimates and assumptions regarding circumstances or trends that could affect the value of these assets, such as economic conditions. Those judgments, estimates and assumptions are based on information available to us at that time. Many of those conditions, trends and circumstances are outside our control and if changes were to occur in the events, trends or other circumstances on which our judgments or estimates were based, we may be required under U.S. GAAP to adjust those estimates that are affected by those changes. Changes in such estimates may require that we reduce the carrying value of the affected assets on our balance sheet (which are commonly referred to as “write downs” of the assets involved).

 

It is our practice to establish reserves or allowances to record adjustments or “write-downs” in the carrying value of assets, such as accounts receivable. Such write-downs are recorded as charges to income or increases in the expense in our Statement of Operations in the periods when such reserves or allowances are established or increased. As a result, our judgments, estimates and assumptions about future events can and will affect not only the amounts at which we record such assets on our balance sheet but also our results of operations.

 

In making our estimates and assumptions, we follow U.S. GAAP applicable to our business and those that we believe will enable us to make fair and consistent estimates of the fair value of assets and establish adequate reserves or allowances. Set forth below is a summary of the accounting policies that we believe are material to an understanding of our financial condition and results of operations.

 

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MARKET INFORMATION

 

Our Small Business registration statement on Form SB-2 was declared effective by the SEC in August 2005 and our shares were approved for listing on the OTC Bulletin Board by the Financial Industry Regulatory Authority (FINRA in December 2005. Prior to December 2005, there was no public market for the common stock. Our common stock is currently quoted on the OTC Electronic Bulletin Board maintained by OTCMarkets.com under the symbol “SFOR.PK”. It has been traded in the over-the-counter market on a limited basis. The following sets forth high and low bid price quotations for each calendar quarter during the last fiscal years that trading occurred or quotations were available, as adjusted by our 1:650 reverse stock split. Such quotations reflect inter-dealer prices, without retail mark-up, mark-down or commission and may not represent actual transactions.

 

Quarter Ended:		Low:				High:
March 31, 2013		$	5,850.00			$	9,652.50
June 30, 2013		$	1,170.00			$	1,657.50
September 30, 2013		$	682.50			$	975.00
December 31, 2013		$	97.50			$	195.00
March 31, 2014		$	91.00			$	117.00
June 30, 2014		$	21.45			$	35.75
September 30, 2014		$	1.69			$	2.21
December 31, 2014		$	0.0065			$	1.30
March 31, 2015		$	0.0025			$	0.0649

  

The closing bid price for our shares of common stock on June 17, 2015 was $0.0001.

   

Our common stock is considered a low priced security under the “Penny Stock” rules promulgated by the Securities and Exchange Commission. Under these rules, broker-dealers participating in transactions in these securities must first deliver a risk disclosure document which describes risks associated with these stocks, broker-dealers’ duties, customers’ rights and remedies, market and other information, and make suitability determinations approving the customers for these stock transactions based on financial situation, investment experience and objectives. Broker-dealers must also disclose these restrictions in writing, provide monthly account statements to customers, and obtain specific written consent of each customer. With these restrictions, the likely effect of designation as a low priced stock is to decrease the willingness of broker-dealers to make a market for the stock, to decrease the liquidity of the stock and increase the transaction cost of sales and purchases of these stocks compared to other securities.

 

HOLDERS

 

As of June 17, 2015, there were approximately 454 holders of the common stock on record with our transfer agent (several holders of record are brokerage firms often through CEDE & Co., which handle accounts for individual investors).

 

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DIVIDENDS

 

We have not previously paid any cash dividends on common stock and do not anticipate or contemplate paying dividends on common stock in the foreseeable future. Our present intention is to utilize all available funds to develop and expand our business. The only restrictions that limit the ability to pay dividends on common equity, or that are likely to do so in the future, are those restrictions imposed by law and those restrictions imposed under contractual obligation. Under Wyoming corporate law, no dividends or other distributions may be made which would render a company insolvent or reduce assets to less than the sum of liabilities plus the amount needed to satisfy outstanding liquidation preferences.

 

Any future determination to pay cash dividends will be at the discretion of our board of directors, and will be dependent upon our financial condition, results of operations, capital requirements and other factors as our board may deem relevant at that time.

 

DIRECTORS AND EXECUTIVE OFFICERS

 

The following sets forth our executive officers and/or Directors, their ages, and all offices and positions held with us: 

 

Name		Age		Position
Mark L. Kay		66		Chief Executive Officer and Chairman of the Board of Directors
Philip E. Blocker		58		Chief Financial Officer
Ramarao Pemmaraju		54		Chief Technical Officer and Director
George Waller		57		Executive Vice President and Marketing Director

 

Directors of the Company hold their offices until the next annual meeting of the Company’s shareholders and until their successors have been duly elected and qualified or until their earlier resignation, removal of office or death. Executive officers of the Company are elected by the board of directors to serve until their successors are elected and qualified.

 

The following is a brief description of the business experience of our executive officers who are also the Directors and significant employees: 

 

Mark L. Kay, Chief Executive Officer and Chairman of the Board of Directors 

 

Mr. Kay joined StrikeForce as our CEO in May 2003 following his retirement at JPMorganChase & Co. In December 2008, a majority of the Board of Directors, by written consent, eliminated the position of our President, with those responsibilities being assumed by Mr. Kay. A majority of the Board of Directors also appointed Mr. Kay as the Chairman of the Board in December 2008. Prior to joining StrikeForce Mr. Kay was employed by JPMorganChase & Co. from August of 1977 until his retirement in December 2002, at which time he was a Managing Director of the firm. During his tenure with JPMorganChase & Co. Mr. Kay led strategic and corporate business groups with global teams up to approximately 1,000 people. His responsibilities also included Chief Operations Officer, Chief Information Officer, and Global Technology Auditor. Mr. Kay’s business concentrations were in securities (fixed income and equities), proprietary trading and treasury, global custody services, audit, cash management, corporate business services and web services. Prior to his employment with JPMorganChase & Co., Mr. Kay was a systems engineer at Electronic Data Services (EDS) for approximately five years from September 1972 through to August 1977. He holds a B.A. in Mathematics from CUNY. 

 

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Philip E. Blocker, Chief Financial Officer

 

Mr. Blocker was CFO of MediaServ, a NYC based Internet software development company, in 2001. Prior to MediaServ, Mr. Blocker was a partner in POLARIS, a $25 million technology reseller, specializing in storage and high availability solutions. He is a Certified Public Accountant and has practical experience with taking private companies’ public.

 

Ramarao Pemmaraju, Chief Technology Officer 

 

Mr. Pemmaraju Joined StrikeForce in July 2002 as our Chief Technology Officer (CTO) and the inventor of the ProtectID® product. In May 1999 Mr. Pemmaraju co-founded NetLabs, which developed security software products. Mr. Pemmaraju concentrated his time on NetLabs from July 2001 through to July 2002. From June 2000 to July 2001 Mr. Pemmaraju was a systems architect and project leader for Coreon, an operations service provider in telecommunications. From October 1998 through May 2000, Mr. Pemmaraju was a systems engineer with Nexgen systems, an engineering consulting firm. Mr. Pemmaraju has over eighteen years’ experience in systems engineering and telecommunications. His specific expertise is in systems architecture, design and product development. Mr. Pemmaraju holds an M.S.E.E. from Rutgers University and a B.E. from Stevens Tech. 

 

George Waller, Executive Vice President and Head of Marketing

 

Mr. Waller joined StrikeForce in June 2002 as a Vice President in charge of sales and marketing. In July 2002, Mr. Waller became the CEO of StrikeForce, a position he held until Mr. Kay joined us in May 2003. Since May 2003, Mr. Waller has been the Executive Vice President overseeing Sales, Marketing, Business Development and product development. From 2000 through June 2002, Mr. Waller was Vice President of business development for Infopro, an outsourcing software development firm. From 1999 to 2001, Mr. Waller was Vice President of sales and Marketing for Teachmeit.com-Incubation systems, Inc., a multifaceted computer company and sister company to Infopro. From 1997 through 1999, Mr. Waller was the Vice President of Internet Marketing for RX Remedy, an aggregator of medical content for online services. Previously, Mr. Waller was a Vice President of Connexus Corporation, a software integrator.

 

Family Relationships 

 

There are no family relationships between any two or more of our directors or executive officers. There is no arrangement or understanding between any of our directors or executive officers and any other person pursuant to which any director or officer was or is to be selected as a director or officer, and there is no arrangement, plan or understanding as to whether non-management shareholders will exercise their voting rights to continue to elect the current board of directors. There are also no arrangements, agreements or understandings to our knowledge between non-management shareholders that may directly or indirectly participate in or influence the management of our affairs. 

 

Involvement in Certain Legal Proceedings 

 

To the best of our knowledge, during the past five years, none of the following occurred with respect to a present or former director or executive officer of our Company: (1) any bankruptcy petition filed by or against any business of which such person was a general partner or executive officer either at the time of the bankruptcy or within two years prior to that time; (2) any conviction in a criminal proceeding or being subject to a pending criminal proceeding (excluding traffic violations and other minor offenses); (3) being subject to any order, judgment or decree, not subsequently reversed, suspended or vacated, of any court of any competent jurisdiction, permanently or temporarily enjoining, barring, suspending or otherwise limiting his involvement in any type of business, securities or banking activities; and (4) being found by a court of competent jurisdiction (in a civil action), the SEC or the commodities futures trading commission to have violated a federal or state securities or commodities law, and the judgment has not been reversed, suspended or vacated.

 

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Board of Directors

 

Our By-laws provide that there must be no less than one and no more than seven directors, as determined by the Board of Directors. Our Board of Directors currently consists of three directors.

 

Directors need not be our stockholders or residents of the State of Wyoming. Directors are elected for an annual term and generally hold office until the next Directors have been duly elected and qualified. A vacancy on the Board may be filled by the remaining Directors even though less than a quorum remains. A Director appointed to fill a vacancy remains a Director until his successor is elected by the Stockholders at the next annual meeting of Shareholder or until a special meeting is called to elect Directors.

 

Our executive officers are appointed by the Board of Directors.

 

During fiscal 2014, our Board of Directors met twenty four times. The Board of Directors also uses written resolutions to deal with certain matters and, during fiscal 2014 twenty-seven written resolutions were signed by a majority of the Directors.

 

Compensation of Directors

 

Our bylaws provide that, unless otherwise restricted by our certificate of incorporation, our Board of Directors has the authority to fix the compensation of directors. The directors may be paid their expenses, if any, related to attendance at each meeting of the board of directors and may be paid a fixed sum for attendance at each meeting of the board of directors or a stated salary as our director. Our bylaws further provide that no such payment will preclude any director from serving our company in any other capacity and receiving compensation therefore. Further, members of special or standing committees may be given compensation for attending committee meetings.

 

Committees

 

We have two committees: the Audit Committee and the Compensation Committee. At this time, there are no members of either Committee and the Board of Directors performs the acts of the Committees. None of our current directors are deemed “independent” directors as that term is used by the national stock exchanges or have the requisite public company accounting background or expertise to be considered an “audit committee financial expert” as that term is defined under Regulation S-K promulgated under the Securities Act of 1933, as amended. 

 

It is anticipated that the principal functions of the Audit Committee will be to recommend the annual appointment of our auditors, the scope of the audit and the results of their examination, to review and approve any material accounting policy changes affecting our operating results and to review our internal control procedures.

 

It is anticipated that the Compensation Committee will develop a Company-wide program covering all employees and that the goals of such program will be to attract, maintain, and motivate our employees. It is further anticipated that one of the aspects of the program will be to link an employee’s compensation to his or her performance, and that the grant of stock options or other awards related to the price of the common shares will be used in order to make an employee’s compensation consistent with shareholders’ gains. It is expected that salaries will be set competitively relative to the technology development industry and that individual experience and performance will be considered in setting salaries.

 

At present, executive and director compensation matters are determined by a majority vote of the board of directors.

 

We do not have a nominating committee. Historically our entire Board has selected nominees for election as directors. The Board believes this process has worked well thus far particularly since it has been the Board's practice to require unanimity of Board members with respect to the selection of director nominees. In determining whether to elect a director or to nominate any person for election by our stockholders, the Board assesses the appropriate size of the Board of Directors, consistent with our bylaws, and whether any vacancies on the Board are expected due to retirement or otherwise. If vacancies are anticipated, or otherwise arise, the Board will consider various potential candidates to fill each vacancy. Candidates may come to the attention of the Board through a variety of sources, including from current members of the Board, stockholders, or other persons. The Board of Directors has not yet had the occasion to, but will, consider properly submitted proposed nominations by stockholders who are not our directors, officers, or employees on the same basis as candidates proposed by any other person.

 

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Section 16(a) Beneficial Ownership Reporting Compliance

 

Section 16(a) of the Exchange Act requires our directors and executive officers, and persons who own more than ten percent (10%) of our outstanding Common Stock, or the Reporting Persons, to file with the SEC initial reports of ownership on Form 3 and reports of changes in ownership of Common Stock on Forms 4 or 5. Such persons are required by SEC regulation to furnish us with copies of all such reports they file. Based solely on a review of Forms 3 and 4 furnished to us by the Reporting Persons or prepared on behalf of the Reporting Persons by the Company, the Company believes that the Reporting Persons have not complied with reporting requirements applicable to them.

 

Code of Ethics.

 

We have adopted a code of ethics that applies to our principal executive officer, principal financial officer, principal accounting officer or controller, or persons performing similar functions. Our code of ethics contains standards that are reasonably designed to deter wrongdoing and to promote:

 

¨	Honest and ethical conduct, including the ethical handling of actual or apparent conflicts of interest between personal and professional relationships;
¨	Full, fair, accurate, timely, and understandable disclosure in reports and documents that we file with, or submits to, the Commission and in other public communications made by us;
¨	Compliance with applicable governmental laws, rules and regulations;
¨	The prompt internal reporting of violations of the code to the board of directors or another appropriate person or persons; and
¨	Accountability for adherence to the code.

 

Indemnification of Officers and Directors

 

As permitted by Wyoming law, our Articles of Incorporation provide that we will indemnify our directors and officers against expenses and liabilities they incur to defend, settle, or satisfy any civil or criminal action brought against them on account of their being or having been our directors or officers unless, in any such action, they are adjudged to have acted with gross negligence or willful misconduct.

 

Pursuant to the foregoing provisions, we have been informed that, in the opinion of the Securities and Exchange Commission, such indemnification is against public policy as expressed in that Act and is, therefore, unenforceable.

 

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Stockholder Communications with the Board

 

Stockholders who wish to communicate with the Board of Directors should send their communications to the Chairman of the Board at the address listed below. The Chairman of the Board is responsible for forwarding communications to the appropriate Board members.

 

StrikeForce Technologies, Inc. 

1090 King George’s Post Road 

Suite #603 

Edison, NJ 08837 

Attn: Mark L. Kay, Chairman

 

EXECUTIVE COMPENSATION

 

Summary Compensation Table

 

The following table sets forth certain compensation information for: (i) the person who served as the Chief Executive Officer of StrikeForce during the year ended December 31, 2014, regardless of the compensation level, and (ii) each of our other executive officers, serving as an executive officer at any time during 2014. The foregoing persons are collectively referred to in this Form 10-K as the “Named Executive Officers.” Compensation information is shown for the years ended December 31, 2014 and 2013: 

 

Name/Principal Position		Year				Salary ($)				Bonus ($)				Stock Awards ($)				Incentive Plan Option Awards ($)				Securities Underlying Options/SARs ($)				Nonqualified Deferred Compensation Earnings ($)				All Other Compensation ($)				Total ($)
Mark L. Kay			2014				98,000								-																				98,000
Chief Executive Officer			2013				98,000				-				2,000				-				-				-				-				100,000
George Waller			2014				98,000								-				-				-				-				-				98,000
Executive Vice President			2013				98,000				-				2,000																				100,000
Ramarao Pemmaraju			2014				98,000				-				-				-				-				-				-				98,000
Chief Technical Officer			2013				98,000								2,000																				100,000

 

On July 31, 2010, Philip E. Blocker was appointed our Chief Financial Officer. Mr. Blocker is not our employee and he received no payments or option awards in 2014.

 

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Outstanding Option Awards at Year End

 

The following table provides certain information regarding unexercised options to purchase common stock, stock options that have not vested, and equity-incentive plan awards outstanding at December 31, 2014, as adjusted by our 1:650 reverse stock split, for each Named Executive Officer and/or Director.

 

Outstanding Equity Awards At Fiscal Year-End Table 

 

		Option Awards																					Stock Awards
Name		Number of Securities Underlying Unexercised Options (#) Exercisable				Number of Securities Underlying Unexercised Options (#) Unexercisable				Equity Incentive Plan Awards: Number of Securities Underlying Unexercised Unearned Options (#)				Option Exercise Price ($)				Option Expiration Date					Number of Shares or Units of Stock That Have Not Vested (#)				Market Value of Shares or Units of Stock That Have Not Vested ($)				Equity Incentive Plan Awards: Number of Unearned Shares, Units or Other Rights That Have Not Vested (#)				Equity Incentive Plan Awards: Market or Payout Value of Unearned Shares, Units or Other Rights That Have Not Vested ($)
Mark L. Kay			1				-				-			$	365,265				03/02/17					-				-				-				-
			1				-				-			$	234,000				03/16/17					-				-				-				-
			1				-				-			$	224,250				04/27/17					-				-				-				-
			1				-				-			$	195,000				05/25/17					-				-				-				-
			1				-				-			$	146,250				06/08/17					-				-				-				-
			1				-				-			$	165,750				06/22/17					-				-				-				-
			3				-				-			$	78,000				11/23/17					-				-				-				-
			1				-				-			$	300.00				12/12/17					-				-				-				-
			1				-				-			$	8,287.50				07/01/15					-				-				-				-
			11				-				-			$	2,437.50				12/21/15					-				-				-				-
			3				-				-			$	5,850.00				12/23/15					-				-				-				-
			16				-				-			$	9,750.00				04/21/16					-				-				-				-
			1				-				-			$	2,242.50				01/03/23					-				-				-				-
George Waller			1				-				-			$	146,250				06/08/17					-				-				-				-
			1				-				-			$	165,750				06/22/17					-				-				-				-
			1				-				-			$	78,000				11/23/17					-				-				-				-
			1				-				-			$	195,000				12/12/17					-				-				-				-
			1				-				-			$	8,287.50				07/01/15					-				-				-				-
			11				-				-			$	2,437.50				12/21/15					-				-				-				-
			3				-				-			$	5,850.00				12/23/15					-				-				-				-
			16				-				-			$	9,750.00				04/21/16					-				-				-				-
			1				-				-			$	2,242.50				01/03/23					-				-				-				-
Ramarao Pemmaraju			1				-				-			$	195,000				05/25/17					-				-				-				-
			7				-				-			$	146,250				06/08/17					-				-				-				-
			1				-				-			$	165,750				06/22/17					-				-				-				-
			1				-				-			$	78,000				11/23/17					-				-				-				-
			1				-				-			$	195,000				12/12/17					-				-				-				-
			1				-				-			$	8,287.50				07/01/15					-				-				-				-
			11				-				-			$	2,437.50				12/21/15					-				-				-				-
			3				-				-			$	5,850.00				12/23/15					-				-				-				-
			16				-				-			$	9,750.00				04/21/16					-				-				-				-
			1				-				-			$	2,242.50				01/03/23					-				-				-				-

 

Option Exercises and Stock Vested Table

 

None.

 

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Pension Benefits Table

 

None.

 

Non-Qualified Deferred Compensation Table

 

Name		Executive Contributions in Last Fiscal Year ($)				Registrant Contributions in Last Fiscal Year ($)				Aggregate Earnings in Last Fiscal Year ($)				Aggregate Withdrawals / Distributions ($)				Aggregate Balance at Last Fiscal Year-End ($)
Mark L. Kay			-				-				-				-				334,985
George Waller			-				-				-				-				331,654
Ramarao Pemmaraju			-				-				-				-				335,216

  

All Other Compensation Table

 

None.

 

Perquisites Table

 

None.

 

Director Compensation

 

All three of our directors were also our executive officers through December 31, 2014. Our directors did not receive any separate compensation for serving as such during fiscal 2014.

 

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SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT

 

The following table sets forth certain information as of December 31, 2014, with respect to the shares of common stock beneficially owned by: (i) each director; (ii) each executive officer; (iii) all current executive officers (regardless of salary and bonus level) and directors as a group; and (iv) each person or entity known by us to beneficially own more than 5% of our outstanding common stock, as adjusted by our 1:650 reverse stock split. The address for each director and executive officer is 1090 King Georges Post Road, Suite 603, Edison, New Jersey 08837. Unless otherwise indicated, the shareholders listed in the table below have sole voting and investment powers with respect to the shares indicated: 

 

This table is based upon information obtained from our stock records.

 

NAME OF BENEFICIAL OWNER		AMOUNT OF OWNERSHIP (1)				PERCENTAGE OF CLASS (2) (excluding Preferred Stock (11))
Mark L. Kay			35	(3),(11)			0.0012	%
Ramarao Pemmaraju			45	(4),(5),(11)			0.0015	%
George Waller			32	(6),(7),(11)			0.0011	%
All directors and executive officers as a group (3 persons)			112	(8)			0.0038	%
NetLabs.com, Inc.			11	(9),(10)			0.0004	%

  

(1)	A person is deemed to be the beneficial owner of securities that can be acquired by such person within 90 days from the date hereof.
(2)	Based on 2,453,522 shares of common stock outstanding as of December 31, 2014; also including 551,488 shares of common stock available upon the conversion of certain convertible loans, 155 shares of common stock underlying options and 30,090 shares of common stock underlying common stock purchase warrants, as adjusted by our 1:650 reverse stock split.
(3)	Includes 1 share of common stock available upon the conversion of certain convertible loans valued at $9,750,000 per share for $240,000 of convertibles and $7,312,500 per share for $28,000 of convertibles, 31 shares of common stock underlying vested five-year options valued from $2,242.50 to $9,750 per share, 1 share of common stock underlying vested ten-year options valued from $78,000 to $365,625 per share and 1 share of common stock underlying common stock purchase warrants, exercisable at $9,750,000, as adjusted by our 1:650 reverse stock split. Mark L. Kay, along with Ramarao Pemmaraju and George Waller each hold one share of Series A Preferred Shares which, collectively, allow the holders to vote up to 80% of the issued and outstanding shares of common and preferred stock; Mark Kay, along with Ramarao Pemmaraju and George Waller have irrevocably waived any conversion rights.
(4)	Includes 1 share of common stock available upon the conversion of certain convertible loans valued at $9,750,000 per share for $25,000 of convertibles and $7,312,500 per share for $5,000 of convertibles, 41 shares of common stock underlying vested five-year options valued from $2,242.50 to $9,750 per share, 1 share of common stock underlying vested ten-year options valued from $78,000 to $195,000 per share and 1 share of common stock underlying common stock purchase warrants, exercisable at $9,750,000, as adjusted by our 1:650 reverse stock split. Of the total shares, 13 shares, consisting of 1 share of common stock available upon the conversion of certain convertible loans valued at $9,750,000 per share for $25,000 of convertibles and $7,312,500 per share for $5,000 of convertibles, 11 shares of common stock underlying vested five-year options valued from $2,242.50 to $9,750 per share, 1 share of common stock underlying vested ten-year options valued from $78,000 to $195,000 per share and 1 share of common stock underlying common stock purchase warrants, exercisable at $9,750,000, as adjusted by our 1:650 reverse stock split are in the name of Sunita Pemmaraju who is a family member of Ramarao Pemmaraju. Mark L. Kay, along with Ramarao Pemmaraju and George Waller each hold one share of Series A Preferred Shares which, collectively, allow the holders to vote up to 80% of the issued and outstanding shares of common stock; Mark Kay, along with Ramarao Pemmaraju and George Waller have irrevocably waived any conversion rights.
(5)	Excludes shares owned by NetLabs.com, Inc. which is controlled by Ramarao Pemmaraju and another individual.
(6)	Shares are listed in the name of Katherine LaRosa who is a family member of George Waller.
(7)	Includes 31 shares of common stock underlying vested five-year options valued from $2,242.50 to $9,750 per share and 1 share of common stock underlying vested ten-year options valued from $78,000 to $195,000 per share, as adjusted by our 1:650 reverse stock split. Mark Kay, along with Ramarao Pemmaraju and George Waller each hold one share of Series A Preferred Shares which, collectively, allow the holders to vote up to 80% of the issued and outstanding shares of common stock; Mark Kay, along with Ramarao Pemmaraju and George Waller have irrevocably waived any conversion rights.
(8)	Includes 2 shares of common stock available upon the conversion of certain convertible loans valued at $9,750,000 per share for $265,000 of convertibles and $7,312,500 per share for $33,000 of convertibles, 103 shares of common stock underlying vested five-year options valued from $2,242.50 to $9,750,000 per share, 3 shares of common stock underlying vested ten-year options valued from $78,000 to $195,000 per share and 2 shares of common stock underlying common stock purchase warrants, exercisable at $9,750,000, as adjusted by our 1:650 reverse stock split. Excludes the Series A Preferred Shares: Mark L. Kay, along with Ramarao Pemmaraju and George Waller, each hold one share of Series A Preferred Shares which, collectively, allow the holders to vote up to 80% of the issued and outstanding shares of common stock; Mark Kay, along with Ramarao Pemmaraju and George Waller, have irrevocably waived any conversion rights.
(9)	Ramarao Pemmaraju controls NetLabs.com, Inc. along with another individual.
(10)	Includes 10 shares of common stock underlying vested ten-year options valued at $1,950 per share, as adjusted by our 1:650 reverse stock split.
(11)	Mark Kay, along with Ramarao Pemmaraju and George Waller hold 3 shares of preferred stock. The Series A Preferred Stock collectively has voting rights equal to eighty percent of the total current issued and outstanding shares of common stock.

 

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Equity Incentive Plan Information

 

The following table sets forth as of December 31, 2014, the total number of shares of our common stock which may be issued upon the exercise of outstanding stock options and other rights under compensation plans approved by the shareholders, and under compensation plans not approved by the shareholders, as adjusted by our 1:650 reverse stock split. The table also sets forth the weighted average purchase price per share of the shares subject to those options, and the number of shares available for future issuance under those plans.

 

Plan Category		Number of securities to be issued upon exercise of outstanding options				Weighted-average exercise price of outstanding options				Number of securities remaining available for future issuance under equity compensation plans (excluding securities reflected in column (a))
Equity compensation plans approved by security holders			144			$	82,411.00				166
Equity compensation plans not approved by security holders			N/A			$	N/A				N/A
Total			144			$	82,411.00				166

 

Options for 137 shares, as adjusted by our 1:650 reverse stock split, have been granted under StrikeForce’s 2004 Equity Incentive Plan which was approved by unanimous consent of the Board of Directors. The option shares were granted at various times from May 2003 through December 2011 and are exercisable at a range of 2,437.50 to $9,375,000 per share, as adjusted by our 1:650 reverse stock split. In August 2008, twelve employees voluntarily surrendered for cancellation 12 options to purchase common stock, as adjusted by our 1:650 reverse stock split. Such surrender did not require any accounting recognition by us.

 

2012 Stock Option Plan

 

In November 2012, our stockholders approved the 2012 Stock Option Plan for our employees, effective January 3, 2013. The number of shares authorized for issuance under the plan is 103, as adjusted by our 1:650 reverse stock split.

 

In January 2013, we awarded options to purchase an aggregate of 7 shares of our common stock, as adjusted by our 1:650 reverse stock split, to our employees out of the 2012 Stock Option Plan. The three (3) officers received options to purchase an aggregate of 1 common share each and the remaining staff received options to purchase an aggregate of 1 common share each, as adjusted by our 1:650 reverse stock split. The exercise price of the option shares is $2,242.50 expiring ten (10) years from the date of issuance, as adjusted by our 1:650 reverse stock split. 

 

General

 

Common Stock

 

The shares of our common stock presently outstanding, and any shares of our common stock issues upon exercise of stock options and/or common stock purchase warrants, will be fully paid and non-assessable. Each holder of common stock is entitled to one vote for each share owned on all matters voted upon by shareholders, and a majority vote is required for all actions to be taken by shareholders. In the event we liquidate, dissolve or wind-up our operations, the holders of the common stock are entitled to share equally and ratably in our assets, if any, remaining after the payment of all our debts and liabilities and the liquidation preference of any shares of preferred stock that may then be outstanding. The common stock has no preemptive rights, no cumulative voting rights, and no redemption, sinking fund, or conversion provisions. Since the holders of common stock do not have cumulative voting rights, holders of more than 50% of the outstanding shares can elect all of our Directors, and the holders of the remaining shares by themselves cannot elect any Directors. Holders of common stock are entitled to receive dividends, if and when declared by the Board of Directors, out of funds legally available for such purpose, subject to the dividend and liquidation rights of any preferred stock that may then be outstanding.

 

36

  

In February 2011, an increase of the authorized shares of our common stock from one hundred million (100,000,000) to five hundred million (500,000,000), $0.0001 par value, was ratified, effective upon the filing of an amendment to our Certificate of Incorporation with the Wyoming Secretary of State.

 

In December 2012, an increase of the authorized shares of our common stock from five hundred million (500,000,000) to seven hundred fifty million (750,000,000), $0.0001 par value, was ratified, effective upon the filing of an amendment to the our Certificate of Incorporation with the Wyoming Secretary of State. The amendment was adopted in February 2013.

 

In May 2013, an increase of the authorized shares of our common stock from seven hundred fifty million (750,000,000) to one billion, five hundred million (1,500,000,000), $0.0001 par value, was ratified, effective upon the filing of an amendment to our Certificate of Incorporation with the Wyoming Secretary of State. The amendment was adopted in May 2013.

 

In July 2013, an increase of the authorized shares of our common stock from one billion, five hundred million (1,500,000,000) to three billion (3,000,000,000), $0.0001 par value, was ratified, effective upon the filing of an amendment to our Certificate of Incorporation with the Wyoming Secretary of State. The amendment was adopted in July 2013.

 

In August 2013, an increase of the authorized shares of our common stock from three billion (3,000,000,000) to five billion (5,000,000,000), $0.0001 par value, was ratified, effective upon the filing of an amendment to our Certificate of Incorporation with the Wyoming Secretary of State. The amendment was adopted in September 2013.

 

In December 2013, an increase of the authorized shares of our common stock from five billion (5,000,000,000) to six billion seven hundred fifty million (6,750,000,000), $0.0001 par value, was ratified, effective upon the filing of an amendment to our Certificate of Incorporation with the Wyoming Secretary of State. The amendment was adopted in January 2014.

 

In February 2014, a 1:1,500 reverse stock split of our issued and outstanding shares of common stock was ratified, effective upon the filing of an amendment to our Certificate of Incorporation with the Wyoming Secretary of State. The amendment was adopted in March 2014.

 

All shares and per share amounts in the financial statements have been adjusted to give retroactive effect to the 1:1,500 reverse stock split adopted in March 2014.

 

In February 2014, a decrease of the authorized shares of our common stock from six billion seven hundred fifty million (6,750,000,000) to one billion, five hundred million (1,500,000,000), $0.0001 par value, was ratified, effective upon the filing of an amendment to our Certificate of Incorporation with the Wyoming Secretary of State. The amendment was adopted in March 2014.

 

In December 2014, an increase of the authorized shares of our common stock from one billion, five hundred million (1,500,000,000) to nine billion (9,000,000,000), $0.0001 par value, was ratified, effective upon the filing of an amendment to our Certificate of Incorporation with the Wyoming Secretary of State. The amendment was adopted in December 2014.

 

In December 2014, a 1:650 reverse stock split of our issued and outstanding shares of common stock was ratified, effective upon the filing of an amendment to our Certificate of Incorporation with the Wyoming Secretary of State. The amendment was adopted in January 2015.

 

All shares and per share amounts in the financial statements have been adjusted to give retroactive effect to the 1:650 reverse stock split adopted in January 2015.

 

In December 2014, a decrease of the authorized shares of our common stock from nine billion (9,000,000,000) to three billion (3,000,000,000), $0.0001 par value, was ratified, effective upon the filing of an amendment to our Certificate of Incorporation with the Wyoming Secretary of State. The amendment was adopted in January 2015.

 

37

  

Preferred Stock

 

On October 21, 2010, we amended our Articles of Incorporation in New Jersey to authorize 10,000,000 shares of preferred stock, par value $0.10. The designations, rights, and preferences of such preferred stock are to be determined by the Board of Directors. On November 15, 2010, we changed our domicile from the state of New Jersey to the state of Wyoming.

 

In addition to the 10,000,000 shares of preferred stock authorized, on January 10, 2011, 100 shares of preferred stock were designated as Series A Preferred Stock and 100,000,000 shares were designated as Series B Preferred Stock. The bylaws under the Wyoming Incorporation were amended to reflect the rights and preferences of each additional new designation.

 

The Series A Preferred Stock collectively has voting rights equal to eighty percent of the total current issued and outstanding shares of common stock. If at least one share of Series A Preferred Stock is outstanding, the aggregate shares of Series A Preferred Stock shall have voting rights equal to the number of shares of common stock equal to four times the sum of the total number of shares of common stock issued and outstanding, plus the number of shares of Series B Preferred Stock (or other designated preferred stock) which are issued and outstanding.

 

In February 2011, we issued three shares of non-convertible Series A preferred stock valued at $329,000 per share, or $987,000 in aggregate, for voting purposes only, to the three members of our management team at one share each. The issued and outstanding shares of the Series A preferred stock have voting rights equal to eighty percent of the total issued and outstanding shares of the our common stock. This effectively provided them, upon retention of their Series A Preferred Stock, voting control on matters presented to our shareholders. They have each irrevocably waived their conversion rights relating to the Series A preferred shares issued.

 

The Series B Preferred Stock shall have preferential liquidation rights in the event of any liquidation, dissolution or winding up of the Company, such liquidation rights to be paid from our assets not delegated to parties with greater priority at $1.00 per share or, in the event an aggregate subscription by a single subscriber of the Series B Preferred Stock is greater than $100,000,000, $0.997 per share. The Series B Preferred Stock shall be convertible to a number of shares of common stock equal to the price of the Series B Preferred Stock divided by the par value of the Series B Preferred Stock, par value $0.10. The option to convert the shares of Series B Preferred Stock may not be exercised until three months following the issuance of the Series B Preferred Stock to the recipient shareholder. The Series B Preferred Stock has ten votes on matters presented to our shareholders for one share of Series B Preferred Stock held. The initial price of the Series B Preferred Stock shall be $2.50, (subject to adjustment by our Board of Directors) until such time, if ever, the Series B Preferred Stock are listed on a secondary and/or public exchange. As of December 31, 2013, no shares of Series B Preferred Stock had been issued.

 

In February 2014, our Board of Directors amended the initial price for the Series B Preferred Stock from $2.50 to $1.50 per share. Our Board of Directors also amended the conversion feature of the Series B Preferred Stock, to convertible common shares $0.0001 par value, to convert at a 40% market discount to current market value at the time we receive a conversion request. Current market value is defined as the average of the immediately prior five trading day's closing prices. Additionally, when Series B Preferred Stock shares convert to our common stock, the minimum price discount floor level is set at $0.005, as decided by our Board of Directors. As of December 31, 2014, there were 142,004 shares of Series B Preferred Stock issued and outstanding.

 

38

  

Issuance of Series A Preferred Stock

 

In February 2011, we issued three shares of non-convertible Series A preferred stock valued at $329,000 per share, or $987,000 in aggregate, for voting purposes only, to the three members of our management team at one share each. The issued and outstanding shares of the Series A preferred stock have voting rights equal to eighty percent of the total issued and outstanding shares of the our common stock. This effectively provided them, upon retention of their Series A Preferred Stock, voting control on matters presented to our shareholders. They have each irrevocably waived their conversion rights relating to the Series A preferred shares issued.

 

Sales of Shares of Series B Preferred Stock

 

In February 2014, we sold subscriptions to three individuals for the purchase of shares of our Series B preferred stock at $1.50 per share. We sold a total of 25,335 shares, for $38,000, that are convertible into shares of our common stock at a 40% discount to current market value, defined as the average of the immediately prior five trading day's closing prices upon receipt of a conversion notice, and with a minimum price level set by our Board of Directors at $0.005. The Series B preferred shares can be converted at any time after six months from the subscription agreements, but only once every 30 days.

 

In March 2014, we sold subscriptions to one individual for the purchase of shares of our Series B preferred stock at $1.50 per share. We sold a total of 16,667 shares, for $25,000, that are convertible into shares of our common stock at a 40% discount to current market value, defined as the average of the immediately prior five trading day's closing prices upon receipt of a conversion notice, and with a minimum price level set by our Board of Directors at $0.005. The Series B preferred shares can be converted at any time after six months from the subscription agreements, but only once every 30 days.

 

All of the above offerings and sales, except the afore-mentioned shares issued pursuant to a conversion of convertible notes, were made in reliance upon the exemption from registration under Rule 506 of Regulation D promulgated under the Securities Act of 1933 and/or Section 4(2) of the Securities Act of 1933, based on the following: (a) the investors confirmed to us that they were “accredited investors,” as defined in Rule 501 of Regulation D promulgated under the Securities Act of 1933 and had such background, education and experience in financial and business matters as to be able to evaluate the merits and risks of an investment in the securities; (b) there was no public offering or general solicitation with respect to the offering; (c) the investors were provided with certain disclosure materials and all other information requested with respect to our company; (d) where applicable, the investors acknowledged that all securities being purchased were “restricted securities” for purposes of the Securities Act of 1933, and agreed to transfer such securities only in a transaction registered under the Securities Act of 1933 or exempt from registration under the Securities Act; and (e) where applicable, a legend was placed on the certificates representing each such security stating that it was restricted and could only be transferred if subsequent registered under the Securities Act of 1933or transferred in a transaction exempt from registration under the Securities Act of 1933.

 

Voting Rights 

 

Each holder of Common Stock is entitled to one vote for each share of Common Stock held on all matters submitted to a vote of stockholders.

 

Each share of the issued and outstanding shares of the Series A preferred stock have voting rights equal to eighty percent of the total issued and outstanding shares of our common stock.

 

Dividends 

 

Subject to preferences that may be applicable to any then-outstanding shares of Preferred Stock, if any, and any other restrictions, holders of Common Stock are entitled to receive ratably those dividends, if any, as may be declared from time to time by our board of directors out of legally available funds. We and our predecessors have not declared any dividends in the past. Further, we do not presently contemplate that there will be any future payment of any dividends on Common Stock.

 

39

  

Amendment of our Bylaws

 

Our bylaws may be adopted, amended or repealed by the affirmative vote of a majority of our outstanding shares. Subject to applicable law, our bylaws also may be adopted, amended or repealed by our Board of Directors.

 

Transfer Agent

 

Our transfer agent is Worldwide Stock Transfer, LLC. Their address is One University Plaza, Suite 505, Hackensack, NJ 07601.

 

INFORMATION ON CONSENTING STOCKHOLDERS

 

Pursuant to the Company’s Bylaws and the Wyoming Articles of Incorporation, a vote by the holders of at least a majority of the outstanding shares of the Company entitled to vote (the “Voting Shares”) is required to effect the action described herein. The Company’s Articles of Incorporation does not authorize cumulative voting for this matter. As of the Record Date, the Company had 6,499,205,160 voting shares issued and outstanding, consisting of three shares of series A preferred shares and 1,299,841,032 shares of common stock, which for voting purposes the preferred shares equate to 80% of the total voting shares and is entitled to one vote per share. The consenting stockholders are the record and beneficial owners of 5,199,364,128 shares of the Company’s preferred and common stock, which represents approximately 80% of the total number of Voting Shares. Pursuant to Section 17-16-724 of the Wyoming Statutes, the consenting stockholders voted in favor of the actions described herein in a written consent, dated December 24, 2014. No consideration was paid for the consent. The consenting stockholder’s names, affiliations with the Company and their beneficial holdings are as follows:

 

Name		Affiliation			Voting Shares		Percentage (4)
Mark L. Kay (1)		Director, Officer and Stockholder			1,844,225,205			26.68	%
Ram Pemmaraju (2)		Director, Officer and Stockholder			1,844,225,205			26.6	%
George Waller (3)		Director, Officer and Stockholder			1,844,225,206			26.8	%
TOTAL					5,532,675,616			80	%

 

	(1)	Mr. Mark L. Kay is the Chief Executive Officer, Chairman of the Board of Directors and a director of the Company.
	(2)	Mr. Ram Pemmaraju is Chief Technical Officer, Secretary and a director of the Company.
	(3)	Mr. George Waller is Executive Vice President and a director of the Company.
	(4)	Based upon 6,915,468,509 “Voting Shares” outstanding as of June 17, 2015. Includes shares of common stock held by the consenting shareholders as the preferred shares represented the voting majority of capital shares.

  

40

 

REVERSE STOCK SPLIT

 

On June 17, 2015, the holders of a majority of the voting power approved a resolution to effectuate a 1,000:1 Reverse Stock Split. Under this Reverse Stock Split each 1,000 shares of our Common Stock will be automatically converted into 1 share of Common Stock. To avoid the issuance of fractional shares of Common Stock, the Company will issue an additional share to all holders of fractional shares. The effective date of the reverse stock split will be on or after July 20, 2015.

 

MATERIAL TERMS, POTENTIAL RISKS AND PRINCIPAL EFFECTS OF THE REVERSE STOCK SPLIT

 

PLEASE NOTE THAT THE REVERSE STOCK SPLIT WILL NOT CHANGE YOUR PROPORTIONATE EQUITY INTERESTS IN THE COMPANY, EXCEPT AS MAY RESULT FROM THE ISSUANCE OR CANCELLATION OF SHARES PURSUANT TO THE FRACTIONAL SHARES.

 

PLEASE NOTE THAT THE REVERSE STOCK SPLIT WILL HAVE THE EFFECT OF SUBSTANTIALLY INCREASING THE NUMBER OF SHARES THE COMPANY WILL BE ABLE TO ISSUE TO NEW OR EXISTING SHAREHOLDERS BECAUSE THE NUMBER OF AUTHORIZED SHARES WILL BE REDUCED BY 60% WHILE THE NUMBER OF SHARES ISSUED AND OUTSTANDING WILL BE REDUCED 1,000-FOLD.

 

The Board of Directors believes that the low stock price and the large number of outstanding shares of our Common Stock have reached a difficult time for clients and investors for the Company. Therefore, with the security software market now, in managements’ opinion, definitely at a peak, such as with SONY, Target, Home Depot, JPMorgan, the FED, Global Hacks, Keylogging, Healthcare companies and banks and other malware hacks, StrikeForce is negotiating with patent and other investors to meet the clients' needs with our upgraded products (that took longer than expected, but are now done), including MobileTrust®. The Board of Directors also believes that the timing is now right in light of our Company’s six patents and litigation, new contracted and interested clients that closed and are due, we believe, in this Fall, and the global channel partners and very interested investors that are engaged with StrikeForce increases in revenues and investments in 2015. As a result, the Board of Directors has proposed the Reverse Stock Split to maintain the business momentum going forward through this Fall 2015, when we expect, but cannot guarantee, to achieve our goals for revenues and investors.

 

We have no present understandings or agreements that will involve the issuance of capital stock. However, we are engaged in negotiations with respect to transactions, including financings and acquisitions, which could involve the issuance of capital stock. As of the date herein, there are no definitive agreements, letters of intent of memorandums of understanding with respect to any transactions, financings or acquisitions.

 

When a company engages in a Reverse Stock Split, it substitutes one share of stock for a predetermined amount of shares of stock. It does not increase the market capitalization of the company. An example of a reverse split is the following. A company has 10,000,000 shares of common stock outstanding. Assume the market price is $.01 per share. Assume that the company declares a 1 for 5 reverse stock split. After the reverse split, that company will have 1/5 as many shares outstanding, or 2,000,000 shares outstanding. The stock will have a market price of $0.05. If an individual investor owned 10,000 shares of that company before the split at $.01 per share, he will own 2,000 shares at $.05 after the split. In either case, his stock will be worth $100. He is no better off before or after. Except that such company hopes that the higher stock price will make that company look better and thus the company will be a more attractive investor or merger or purchase target for potential business. There is no assurance that that company's stock will rise in price after a reverse split or that a suitable investor, merger or purchaser candidate will emerge.

 

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The Board of Directors believes that the Reverse Stock Split may improve the price level of our Common Stock and that the higher share price could help generate interest in the Company among investors and other business opportunities. However, the effect of the reverse split upon the market price for our Common Stock cannot be predicted, and the history of similar stock split combinations for companies in like circumstances is varied. There can be no assurance that the market price per share of our Common Stock after the reverse split will rise in proportion to the reduction in the number of shares of Common Stock outstanding resulting from the reverse split. The market price of our Common Stock may also be based on our performance and other factors, some of which may be unrelated to the number of shares outstanding.

 

The reverse split will affect all of our stockholders uniformly and will not affect any stockholder's percentage ownership interests in the Company or proportionate voting power, except to the extent that the reverse split results in any of our stockholders owning a fractional share. All stockholders holding a fractional share shall be issued an additional share. The principal effect of the Reverse Stock Split will be that the number of shares of Common Stock issued and outstanding will be reduced from 1,382,668,553 shares of Common Stock as of June 17th, 2015 to approximately 1,382,668 Common Stock, $0.0001 par value (depending on the number of fractional shares that are issued or cancelled). The Reverse Stock Split will affect the shares of common stock outstanding. Currently, the Company only has three (3) Preferred Shares authorized that are not affected. These Preferred Series ‘A’ Shares are not convertible to shares of Common Stock. The reverse Split will not affect any convertible securities currently outstanding, other than a few Convertible Promissory notes with fixed convertible prices, as such securities convert for the most part based on a percentage calculation related to stock price alone.

 

The Reverse Stock Split will not affect the par value of our Common Stock. As a result, on the effective date of the Reverse Stock Split, the stated capital on our balance sheet attributable to our Common Stock will be reduced to less than the present amount, and the additional paid-in capital account shall be credited with the amount by which the stated capital is reduced. The per share net income or loss and net book value of our Common Stock will be increased because there will be fewer shares of our Common Stock outstanding.

 

The Reverse Stock Split will not change the proportionate equity interests of our stockholders, nor will the respective voting rights and other rights of stockholders be altered. The Common Stock issued pursuant to the Reverse Stock Split will remain fully paid and non-assessable. The Reverse Stock Split is not intended as, and will not have the effect of, a “going private transaction” covered by Rule 13e-3 under the Securities Exchange Act of 1934. We will continue to be subject to the periodic reporting requirements of the Securities Exchange Act of 1934.

 

Stockholders should recognize that they will own fewer numbers of shares than they presently own (a number equal to the number of shares owned immediately prior to the filing of the certificate of amendment divided by 650. While we expect that the Reverse Stock Split will result in an increase in the potential market price of our Common Stock, there can be no assurance that the Reverse Stock Split will increase the potential market price of our Common Stock by a multiple equal to the exchange number or result in the permanent increase in any potential market price (which is dependent upon many factors, including our performance and prospects). Also, should the market price of our Common Stock decline, the percentage decline as an absolute number and as a percentage of our overall market capitalization may be greater than would pertain in the absence of a reverse split. Furthermore, the possibility exists that potential liquidity in the market price of our Common Stock could be adversely affected by the reduced number of shares that would be outstanding after the reverse split. In addition, the reverse split will increase the number of stockholders of the Company who own odd lots (less than 100 shares). Stockholders who hold odd lots typically will experience an increase in the cost of selling their shares, as well as possible greater difficulty in effecting such sales. Consequently, there can be no assurance that the reverse split will achieve the desired results that have been outlined above.

 

The Reverse Split of the Common Stock is expected to become effective after we file Articles of Amendment to our Articles of Incorporation (the “Effective Date”). Upon the Effective Date, the Company will notify FINRA and request an ex-dividend date. The Reverse Split will take place on the Effective Date without any action on the part of the holders of the Common Stock and without regard to current certificates representing shares of Common Stock being physically surrendered for certificates representing the number of shares of Common Stock each shareholder is entitled to receive as a result of the Reverse Split. New certificates of Common Stock will not be issued at this time.

 

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We do not have any provisions in our Articles, by laws, or employment or credit agreements to which we are party that have anti-takeover consequences. We do not currently have any plans to adopt anti-takeover provisions or enter into any arrangements or understandings that would have anti-takeover consequences. In certain circumstances, our management may issue additional shares to resist a third party takeover transaction, even if done at an above market premium and favored by a majority of independent shareholders.

 

There are no adverse material consequences or any anti-takeover provisions in either our Articles of Incorporation or Bylaws that would be triggered as a consequence of the Reverse Split. The Articles of Incorporation or Bylaws do not address any consequence of the Reverse Split.

 

FEDERAL INCOME TAX CONSEQUENCES

 

The following summary of material federal income tax consequences of the Reverse Split does not purport to be a complete discussion of all of the possible federal income tax consequences. Further, it does not address any state, local, foreign or other income tax consequences, nor does it address the tax consequences to shareholders that are subject to special tax rules, such as banks, insurance companies, regulated investment companies, personal holding companies, foreign entities, nonresident alien individuals, broker-dealers and tax-exempt entities. The discussion is based on the United States federal income tax laws as of the date of this Information Statement. Such laws are subject to change retroactively as well as prospectively. This summary also assumes that the shares of Common Stock are held as “capital assets,” as defined in the Internal Revenue Code of 1986, as amended. The tax treatment of a shareholder may vary depending on the facts and circumstances of such shareholder.

 

EACH SHAREHOLDER IS URGED TO CONSULT WITH SUCH SHAREHOLDER’S TAX ADVISOR WITH RESPECT TO THE PARTICULAR TAX CONSEQUENCES OF THE REVERSE SPLIT.

 

No gain or loss will be recognized by a shareholder as a result of the Reverse Split. The aggregate tax basis of the shares received in the Reverse Split will be the same as the shareholder’s aggregate tax basis in the shares exchanged. The shareholder’s holding period for the shares received in the Reverse Split will include the period during which the shareholder held the shares surrendered as a result of the Reverse Split. The Company’s views regarding the tax consequences of the Reverse Split are not binding upon the Internal Revenue Service or the courts, and there is no assurance that the Internal Revenue Service or the courts would accept the positions expressed above. The state and local tax consequences of the Reverse Split may vary significantly as to each shareholder, depending on the state in which such shareholder resides.

 

This summary of the tax consequences of the Reverse Split is not binding on the Internal Revenue Service or the courts, and the tax treatment to particular stockholders may vary depending upon each stockholder’s particular facts and circumstances. Accordingly, each stockholder should consult with the stockholder’s own tax advisor with respect to all of the potential tax consequences of the Reverse Split.

 

INCREASE IN AUTHORIZED

 

On June 17, 2015, Board of Directors and the holders of a majority of the voting power approved a resolution for an increase in Authorized shares of Common Stock from three billion (3,000,000,000) shares to five billion (5,000,000,000) shares, $0.0001 par value, of the Company.

 

MATERIAL TERMS, POTENTIAL RISKS AND PRINCIPAL EFFECTS OF THE DECREASE OF THE AUTHORIZED COMMON STOCK

 

With the 60% reduction of the authorized Common Stock, the Company does not foresee the requirement to increase its authorized Common Stock, however the Company cannot ensure increases to the authorized common stock will not be necessary in the future.

 

DELIVERY OF INFORMATION STATEMENT

 

To reduce the expenses of delivering duplicate materials to our stockholders, we are taking advantage of householding rules that permit us to deliver only one Information Statement to stockholders who share the same address unless otherwise requested.

 

If you share an address with another stockholder and have received only one Information Statement, you may write or call us to request a separate copy at no cost to you. For future mailings, you may request separate materials or, if you are receiving multiple copies you may request that we only send one set of materials, by writing to us at StrikeForce Technologies, Inc., 1090 King Georges Post Road, Suite #603, Edison, NJ 08837.

 

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WHERE YOU CAN FIND MORE INFORMATION

 

We file annual, quarterly and current reports, proxy statements and other information with the SEC. You may read or copy any document we file at the public reference room maintained by the SEC at 100 F Street, N.E., Washington, D.C. 20549. Copies of this information may also be obtained by mail from the SEC’s Public Reference Branch at 100 F Street, N.E., Washington, D.C. 20549. In addition, our filings with the SEC are also available to the public on the SEC’s internet website at http://www.sec.gov.

 

INFORMATION INCORPORATED BY REFERENCE

 

The following documents are incorporated herein by reference and are deemed to be a part hereof from the date of filing of such documents:

 

Annual Report on Form 10-K for the fiscal year ended December 31, 2014 

Quarterly Reports on Form 10-Q for the quarters ended March 31, 2015, September 30, 2014, June 30, 2014, March 31, 2014. 

Reports in Form 8-K

 

All documents filed by the Company with the SEC pursuant to Sections 13(a), 13(c), 14 or 15(d) of the Exchange Act after the date of this Information Statement and prior to the effective date of the action taken described herein.

 

Any statement contained in a document incorporated or deemed to be incorporated by reference herein shall be deemed to be modified or superseded for purposes of this Information Statement to the extent that a statement contained herein, or in any other subsequently filed document that also is, or is deemed to be, incorporated by reference herein, modifies or supersedes such statement. Any such statement so modified or superseded shall not be deemed, except as so modified or superseded, to constitute a part of this Information Statement.

 

This Information Statement incorporates, by reference, certain documents that are not presented herein or delivered herewith. Copies of any such documents, other than exhibits to such documents which are not specifically incorporated by reference herein, are available without charge to any person, including any stockholder, to whom this proxy statement is delivered, upon written or oral request to our Secretary at our address and telephone number set forth herein.

 

DISTRIBUTION OF INFORMATION STATEMENT

 

The cost of distributing this Information Statement has been borne by us and certain shareholders that consented to the action taken herein. The distribution will be made by mail.

 

Pursuant to the requirements of the Exchange Act of 1934, as amended, the Registrant has duly caused this Information Statement to be signed on its behalf by the undersigned hereunto authorized.

 

	STRIKEFORCE TECHNOLOGIES, INC.
Date: June 19, 2015	By:	/s/ Mark L Kay
		Mark L Kay
		Chief Executive Officer

 

 

 

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