10-Q

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

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

For the quarterly period ended: June 30, 2018

OR

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

For the transition period from __________ to __________

Commission File No. 000-33383

JERRICK MEDIA HOLDINGS, INC.

(Exact name of registrant as specified in its charter)

Nevada	87-0645394
(State or other jurisdiction of incorporation)	(IRS Employer Identification No.)

2050 Center Avenue Suite 640

Fort Lee, New Jersey 07024

(Address of principal executive offices)

(201) 258-3770

(Registrant’s telephone number, including area code)

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by section 13 or 15(d) of the Securities Exchange Act of 1934 during the past 12 months, and (2) has been subject to such filing requirements for the past 90 days. Yes ☐ No ☒

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

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

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

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

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

As of August 20, 2018, there were 40,524,432 shares outstanding of the registrant’s common stock.

TABLE OF CONTENTS

	PART I – FINANCIAL INFORMATION
Item 1.	Consolidated Financial Statements	1
Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	32
Item 3.	Quantitative and Qualitative Disclosures About Market Risk	37
Item 4.	Controls and Procedures	37
	PART II – OTHER INFORMATION
Item 1.	Legal Proceedings	38
Item 1A.	Risk Factors	38
Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	38
Item 3.	Defaults Upon Senior Securities	38
Item 4.	Mine Safety Disclosures	38
Item 5.	Other Information	38
Item 6.	Exhibits	39
Signatures		40

Jerrick Media Holdings, Inc.

June 30, 2018 and 2017

Index to the Condensed Consolidated Financial Statements

Contents	Page(s)
Condensed Consolidated Balance Sheets as of June 30, 2018 (unaudited) and December 31, 2017	2
Condensed Consolidated Statements of Operations for the Three and Six Months Ended June 30, 2018 and 2017 (unaudited)	3
Condensed Consolidated Statements of Cash Flows for the Six Months Ended June 30, 2018 and 2017 (unaudited)	4
Notes to the Condensed Consolidated Financial Statements (unaudited)	5

1

Jerrick Media Holdings, Inc.

Condensed Consolidated Balance Sheet

(Unaudited)

	June 30, 2018			December 31, 2017
				(revised)
Assets
Current Assets
Cash	$	22,422		$	111,051
Prepaid expenses		86,274			-
Accounts receivable		9,170			1,325
Total Current Assets		117,866			112,376
Property and equipment, net		52,063			48,056
Security deposit		16,836			17,000
Total Assets	$	186,765		$	177,432
Liabilities and Stockholders’ Deficit
Current Liabilities
Accounts payable and accrued liabilities	$	2,094,658		$	1,462,106
Demand loan		60,366			10,366
Current portion of Convertible Notes - related party, net of debt discount		30,916			-
Current portion of Convertible Notes, net of debt discount		59,500			96,500
Current portion of capital lease payable		4,732			4,732
Note payable - related party, net of debt discount		1,305,907			1,249,000
Note payable, net of debt discount and issuance costs		791,467			689,500
Line of credit - related party		130,000			130,000
Line of credit		-			44,996
Current portion of deferred rent		1,800			-
Total Current Liabilities		4,479,346			3,687,200
Non-current Liabilities:
Deferred rent		7,757			-
Convertible Notes - related party, net of debt discount		1,571,792			1,345,246
Convertible Notes, net of debt discount and issuance costs		4,042,808			2,512,293
Total Non-current Liabilities		5,622,357			3,857,539
Total Liabilities		10,101,703			7,544,739
Commitments and contingencies
Stockholders’ Deficit
Series A Preferred stock, $0.001 par value, 31,581 and 31,581 shares issued and outstanding, respectively		31			31
Series B Preferred stock, $0.001 par value, 8,063 and 8,063 shares issued and outstanding, respectively		8			8
Series D Preferred stock, $0.001 par value, 0 and 0 shares issued and outstanding, respectively		-			-
Common stock par value $0.001: 300,000,000 shares authorized; 40,524,432 and 39,520,682 issued and outstanding as of June 30, 2018 and December 31,2017 respectively		40,525			39,521
Additional paid in capital		16,343,480			14,387,247
Accumulated deficit		(26,279,975	)		(21,775,107	)
Less: Treasury stock, 220,000 and 220,000 shares, respectively		(19,007	)		(19,007	)
		(9,914,938	)		(7,367,307	)
Total Liabilities and Stockholders’ Deficit	$	186,765		$	177,432

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

2

Jerrick Media Holdings, Inc.

Condensed Consolidated Statements of Operations

(Unaudited)

	For the Three Months Ended			For the Three Months Ended			For the Six Months Ended			For the Six Months Ended
	June 30, 2018			June 30, 2017			June 30, 2018			June 30, 2017
				(revised)						(revised)
Net revenue	$	24,023		$	52,259		$	40,272		$	94,101
Operating expenses
Compensation		451,041			709,298			1,102,829			1,255,408
Consulting fees		350,804			37,565			446,603			177,570
General and administrative		787,881			253,015			1,380,120			636,753
Total operating expenses		1,589,726			999,878			2,929,552			2,069,731
Loss from operations		(1,565,703	)		(947,619	)		(2,889,280	)		(1,975,630	)
Other income (expenses)
Interest expense		(341,071	)		(87,318	)		(609,196	)		(144,705	)
Accretion of debt discount and issuance cost		(415,045	)		(431,720	)		(589,933	)		(724,900	)
Settlement of vendor liabilities		-			-			1,875			(110,674	)
Loss on extinguishment of debt		(89,419	)		-			(431,786	)		-
Gain on settlement of debt		-			-			13,452			-
Other income (expenses), net		(845,535	)		(519,038	)		(1,615,588	)		(980,279	)
Loss before income tax provision		(2,411,238	)		(1,466,657	)		(4,504,868	)		(2,955,909	)
Income tax provision		-			-			-			-
Net loss	$	(2,411,238	)	$	(1,466,657	)	$	(4,504,868	)	$	(2,955,909	)
Deemed dividend		65,823			67,888			129,858			131,867
Net loss attributable to common shareholders		(2,477,061	)		(1,534,545	)		(4,634,726	)		(3,087,776	)
Per-share data
Basic and diluted loss per share	$	(0.06	)	$	(0.04	)	$	(0.12	)	$	(0.08	)
Weighted average number of common shares outstanding		40,524,432			38,014,509			40,230,654			37,247,125

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

3

Jerrick Media Holdings, Inc.

Condensed Consolidated Statements of Cash Flows

(Unaudited)

	For the Six Months Ended			For the Six Months Ended
	June 30, 2018			June 30, 2017
				(revised)
CASH FLOWS FROM OPERATING ACTIVITIES:
Net loss	$	(4,504,868	)	$	(2,955,909	)
Adjustments to reconcile net loss to net cash used in operating activities:
Depreciation		21,439			18,704
Accretion of debt discount and issuance cost		589,933			128,900
Share-based compensation		285,821			596,000
Loss on settlement of vendor liabilities		(1,875	)		627,619
Gain on settlement of debt		(13,452	)		110,674
Loss on extinguishment of debt		431,786			-
Changes in operating assets and liabilities:
Prepaid expenses		(18,864	)		10,000
Inventory
Accounts receivable		(7,845	)		-
Security deposit		164			-
Accounts payable and accrued expenses		900,595			77,642
Deferred rent		707			-
Net Cash Used In Operating Activities		(2,316,459	)		(1,386,370	)
CASH FLOWS FROM INVESTING ACTIVITIES:
Cash paid for property and equipment		(16,446	)		-
Net Cash Used In Investing Activities		(16,446	)		-
CASH FLOWS FROM FINANCING ACTIVITIES:
Net proceeds from issuance of notes		658,500			1,041,585
Repayment of notes		(85,675	)		-
Proceeds from issuance of demand loan		50,000			-
Proceeds from issuance of convertible note		1,525,154			71,500
Repayment of convertible notes		(76,798	)		-
Proceeds from issuance of convertible notes - related party		299,852			50,000
Proceeds from issuance of note payable - related party		245,000			185,000
Repayment of note payable - related party		(160,000	)		(120,000	)
Proceeds from issuance of line of credit - related party		-			130,000
Repayment of line of credit		(44,996	)		(41,706	)
Cash paid for debt issuance costs		(166,761	)		(99,226	)
Net Cash Provided By Financing Activities		2,244,276			1,217,153
Net Change in Cash		(88,629	)		(169,217	)
Cash - Beginning of Year		111,051			174,494
Cash - End of Year	$	22,422		$	5,277
SUPPLEMENTARY CASH FLOW INFORMATION:
Cash Paid During the Year for:
Income taxes	$	-		$	-
Interest	$	64,892		$	3,534
SUPPLEMENTARY DISCLOSURE OF NON-CASH INVESTING AND FINANCING ACTIVITIES:
Settlement of vendor liabilities	$	3,750		$	353,732
Beneficial conversion feature on convertible notes	$	38,413		$	-
Deemed dividends	$	127,795		$	131,867
Warrants issued with debt	$	1,085,221		$	620,714
Issuance of common stock for prepaid services	$	116,300		$	-
Conversion of note payable and interest into convertible notes	$	341,442		$	-
Warrants issued with amendment to notes payable	$	135,596		$	-

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

4

Jerrick Media Holdings, Inc.

June 30, 2018 and 2017

Notes to the Consolidated Financial Statements

(Unaudited)

Note 1 – Organization and Operations

Jerrick Media Holdings, Inc. (“we,” “us,” the “Company,” or “Jerrick Media” or “Jerrick”) (formerly Great Plains Holdings, Inc. or “GTPH”) was incorporated under the laws of the state of Nevada on December 30, 1999 under the name LILM, Inc. The Company changed its name on December 3, 2013 to Great Plains Holdings, Inc. as part of its plan to diversify its business through the acquisition and operation of commercial real estate, including, but not limited to, self-storage facilities, apartment buildings, 55+ senior manufactured home communities, and other income producing properties. Historically, the Company has principally engaged in the manufacture and marketing of the LiL Marc, a plastic boys’ toilet-training device, which we discontinued as of December 31, 2014.

On February 5, 2016 (the “Closing Date”), GTPH, GPH Merger Sub, Inc., a Nevada corporation and wholly-owned subsidiary of GTPH (“Merger Sub”), and Jerrick Ventures, Inc., a privately-held Nevada corporation headquartered in New Jersey (“Jerrick”), entered into an Agreement and Plan of Merger (the “Agreement”) pursuant to which the Merger Sub was merged with and into Jerrick, with Jerrick surviving as a wholly-owned subsidiary of GTPH (the “Merger”). GTPH acquired, through a reverse triangular merger, all of the outstanding capital stock of Jerrick in exchange for issuing Jerrick’s shareholders (the “Jerrick Shareholders”), pro-rata, a total of 28,500,000 shares of GTPH’s common stock. GTPH assumed 33,415 shares of Jerrick’s Series A Convertible Preferred Stock (the “Jerrick Series A Preferred”) and 8,064 shares of Series B Convertible Preferred Stock (the “Jerrick Series B Preferred”).

In connection with the Merger, on the Closing Date, GTPH and Kent Campbell entered into a Spin-Off Agreement (the “Spin-Off Agreement”), pursuant to which Mr. Campbell purchased from GTPH (i) all of GTPH’s interest in Ashland Holdings, LLC, a Florida limited liability company, and (ii) all of GTPH’s interest in Lil Marc, Inc., a Utah corporation, in exchange for the cancellation of 781,818 shares of GTPH’s Common Stock held by Mr. Campbell. In addition, Mr. Campbell assumed all debts, obligations and liabilities of GTPH, including any existing prior to the Merger, pursuant to the terms and conditions of the Spin-Off Agreement.

Upon closing of the Merger on February 5, 2016, the Company changed its business plan to that of Jerrick Media.

Effective February 28, 2016, GTPH entered into an Agreement and Plan of Merger (the “Statutory Merger Agreement”) with Jerrick, pursuant to which GTPH became the parent company of Jerrick Ventures, LLC, a wholly-owned operating subsidiary of Jerrick (the “Statutory Merger”) and GTPH changed its name to Jerrick Media Holdings, Inc. to better reflect its new business strategy.

Jerrick Media is a technology company focused on the development of digital communities, marketing branded digital content, and e-commerce opportunities. Jerrick’s content distribution platform, Vocal, delivers a robust long-form, digital publishing platform organized into highly engaged niche-communities capable of hosting all forms of rich media content. Through Jerrick’s proprietary algorithm dynamics, Vocal enhances the visibility of content and maximizes viewership, providing advertisers access to target markets that most closely match their interests.

Note 2 – Significant and Critical Accounting Policies and Practices

Management of the Company is responsible for the selection and use of appropriate accounting policies and the appropriateness of accounting policies and their application. Critical accounting policies and practices are those that are both most important to the portrayal of the Company’s financial condition and results and require management’s most difficult, subjective, or complex judgments, often as a result of the need to make estimates about the effects of matters that are inherently uncertain. The Company’s significant and critical accounting policies and practices are disclosed below as required by generally accepted accounting principles.

5

Basis of Presentation - Unaudited Interim Financial Information

The accompanying unaudited interim condensed consolidated financial statements and related notes have been prepared in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”) for interim financial information, and in accordance with the rules and regulations of the United States Securities and Exchange Commission (the “SEC”) with respect to Form 10-Q and Article 10 of Regulation S-X. Accordingly, they do not include all of the information and footnotes required by U.S. GAAP for complete financial statements. The unaudited interim condensed consolidated financial statements furnished reflect all adjustments (consisting of normal recurring adjustments) which are, in the opinion of management, necessary for a fair statement of the results for the interim periods presented. Interim results are not necessarily indicative of the results for the full year. These unaudited interim condensed consolidated financial statements should be read in conjunction with the audited consolidated financial statements and notes thereto contained in the Company’s annual report on Form 10-K for the year ended December 31, 2017.

Use of Estimates and Assumptions and Critical Accounting Estimates and Assumptions

The preparation of financial statements in conformity with US GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the dates of the financial statements and the reported amounts of revenues and expenses during the reporting periods.

Critical accounting estimates are estimates for which (a) the nature of the estimate is material due to the levels of subjectivity and judgment necessary to account for highly uncertain matters or the susceptibility of such matters to change and (b) the impact of the estimate on financial condition or operating performance is material. The Company’s critical accounting estimates and assumptions affecting the financial statements were:

(i)	Assumption as a going concern: Management assumes that the Company will continue as a going concern, which contemplates continuity of operations, realization of assets, and liquidation of liabilities in the normal course of business.
(ii)	Fair value of long-lived assets: Fair value is generally determined using the asset’s expected future discounted cash flows or market value, if readily determinable. If long-lived assets are determined to be recoverable, but the newly determined remaining estimated useful lives are shorter than originally estimated, the net book values of the long-lived assets are depreciated over the newly determined remaining estimated useful lives. The Company considers the following to be some examples of important indicators that may trigger an impairment review: (i) significant under-performance or losses of assets relative to expected historical or projected future operating results; (ii) significant changes in the manner or use of assets or in the Company’s overall strategy with respect to the manner or use of the acquired assets or changes in the Company’s overall business strategy; (iii) significant negative industry or economic trends; (iv) increased competitive pressures; (v) a significant decline in the Company’s stock price for a sustained period of time; and (vi) regulatory changes. The Company evaluates acquired assets for potential impairment indicators at least annually and more frequently upon the occurrence of such events.
(iii)	Valuation allowance for deferred tax assets: Management assumes that the realization of the Company’s net deferred tax assets resulting from its net operating loss (“NOL”) carry–forwards for Federal income tax purposes that may be offset against future taxable income was not considered more likely than not and accordingly, the potential tax benefits of the net loss carry-forwards are offset by a full valuation allowance. Management made this assumption based on (a) the Company has incurred recurring losses, (b) general economic conditions, and (c) its ability to raise additional funds to support its daily operations by way of a public or private offering, among other factors.
(iv)	Estimates and assumptions used in valuation of equity instruments: Management estimates expected term of share options and similar instruments, expected volatility of the Company’s common shares and the method used to estimate it, expected annual rate of quarterly dividends, and risk free rate(s) to value share options and similar instruments.

6

These significant accounting estimates or assumptions bear the risk of change due to the fact that there are uncertainties attached to these estimates or assumptions, and certain estimates or assumptions are difficult to measure or value.

Management bases its estimates on historical experience and on various assumptions that are believed to be reasonable in relation to the financial statements taken as a whole under the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities that are not readily apparent from other sources.

Management regularly evaluates the key factors and assumptions used to develop the estimates utilizing currently available information, changes in facts and circumstances, historical experience and reasonable assumptions. After such evaluations, if deemed appropriate, those estimates are adjusted accordingly.

Actual results could differ from those estimates.

Principles of consolidation

The Company consolidates all majority-owned subsidiaries, if any, in which the parent’s power to control exists.

As of June 30, 2018, the Company’s consolidated subsidiaries and/or entities are as follows:

Name of combined affiliate	State or other jurisdiction of incorporation or organization	Company interest
Jerrick Ventures LLC	The State of Delaware		100%
Jerrick Australia Pty Ltd	Australia		100%

All inter-company balances and transactions have been eliminated.

Jerrick Australia Pty Ltd does not have any operations.

Fair Value of Financial Instruments

The Company follows paragraph 825-10-50-10 of the FASB Accounting Standards Codification for disclosures about fair value of its financial instruments and paragraph 820-10-35-37 of the FASB Accounting Standards Codification (“Paragraph 820-10-35-37”) to measure the fair value of its financial instruments. Paragraph 820-10-35-37 establishes a framework for measuring fair value in U.S. GAAP, and expands disclosures about fair value measurements. To increase consistency and comparability in fair value measurements and related disclosures, Paragraph 820-10-35-37 establishes a fair value hierarchy which prioritizes the inputs to valuation techniques used to measure fair value into three (3) broad levels. The fair value hierarchy gives the highest priority to quoted prices (unadjusted) in active markets for identical assets or liabilities and the lowest priority to unobservable inputs. The three (3) levels of fair value hierarchy defined by Paragraph 820-10-35-37 are described below:

Level 1	Quoted market prices available in active markets for identical assets or liabilities as of the reporting date.
Level 2	Pricing inputs other than quoted prices in active markets included in Level 1, which are either directly or indirectly observable as of the reporting date.
Level 3	Pricing inputs that are generally observable inputs and not corroborated by market data.

Financial assets are considered Level 3 when their fair values are determined using pricing models, discounted cash flow methodologies or similar techniques and at least one significant model assumption or input is unobservable.

The fair value hierarchy gives the highest priority to quoted prices (unadjusted) in active markets for identical assets or liabilities and the lowest priority to unobservable inputs. If the inputs used to measure the financial assets and liabilities fall within more than one level described above, the categorization is based on the lowest level input that is significant to the fair value measurement of the instrument.

7

The carrying amount of the Company’s financial assets and liabilities, such as cash, prepaid expenses, accounts payable and accrued liabilities and accrued liquidating damages approximate their fair value because of the short maturity of those instruments. Transactions involving related parties cannot be presumed to be carried out on an arm’s-length basis, as the requisite conditions of competitive, free-market dealings may not exist. Representations about transactions with related parties, if made, shall not imply that the related party transactions were consummated on terms equivalent to those that prevail in arm’s-length transactions unless such representations can be substantiated.

Cash Equivalents

The Company considers all highly liquid investments with a maturity of three months or less when purchased to be cash equivalents.

The Company minimizes its credit risk associated with cash by periodically evaluating the credit quality of its primary financial institution. The balance at times may exceed federally insured limits.

Property and Equipment

Property and equipment are recorded at cost. Expenditures for major additions and betterments are capitalized. Maintenance and repairs are charged to operations as incurred. Depreciation is computed by the straight-line method (after taking into account their respective estimated residual values) over the estimated useful lives of the respective assets as follows:

	Estimated Useful Life (Years)
Computer equipment and software		3
Furniture and fixture		5
Leasehold improvement		5

Upon sale or retirement of property and equipment, the related cost and accumulated depreciation are removed from the accounts and any gain or loss is reflected in the consolidated statements of operations.

Commitments and Contingencies

The Company follows subtopic 450-20 of the FASB Accounting Standards Codification to report accounting for contingencies. Certain conditions may exist as of the date the condensed consolidated financial statements are issued, which may result in a loss to the Company, but which will only be resolved when one or more future events occur or fail to occur. The Company assesses such contingent liabilities, and such assessment inherently involves an exercise of judgment. In assessing loss contingencies related to legal proceedings that are pending against the Company or un-asserted claims that may result in such proceedings, the Company evaluates the perceived merits of any legal proceedings or un-asserted claims as well as the perceived merits of the amount of relief sought or expected to be sought therein.

If the assessment of a contingency indicates that it is probable that a material loss has been incurred and the amount of the liability can be estimated, then the estimated liability would be accrued in the Company’s consolidated financial statements. If the assessment indicates that a potential material loss contingency is not probable but is reasonably possible, or is probable but cannot be estimated, then the nature of the contingent liability, and an estimate of the range of possible losses, if determinable and material, would be disclosed.

Loss contingencies considered remote are generally not disclosed unless they involve guarantees, in which case the guarantees would be disclosed.

8

Derivative Liability

The Company adopted Section 815-40-15 of the FASB Accounting Standards Codification (“Section 815-40-15”) to determine whether an instrument (or an embedded feature) is indexed to the Company’s own stock. Section 815-40-15 provides that an entity should use a two-step approach to evaluate whether an equity-linked financial instrument (or embedded feature) is indexed to its own stock, including evaluating the instrument’s contingent exercise and settlement provisions.  The Company changed its method of accounting for the debt and warrants through the early adoption of ASU 2017-11 during the year ended December 31, 2017 on a retrospective basis.

Revenue Recognition

The Company adopted ASC 606 effective January 1, 2018 using the modified retrospective method which would require a cumulative effect adjustment for initially applying the new revenue standard as an adjustment to the opening balance of retained earnings and the comparative information would not require to be restated and continue to be reported under the accounting standards in effect for those periods.

Based on the Company’s analysis the Company did not identify a cumulative effect adjustment for initially applying the new revenue standards. During the six months ended June 30, 2018 the Company recorded revenue from the following sources: products at auction, sponsored content and affiliate sites.

The adoption of ASC 606 represents a change in accounting principle that will more closely align revenue recognition with the delivery of the Company's services and will provide financial statement readers with enhanced disclosures. In accordance with ASC 606, revenue is recognized when a customer obtains control of promised services. The amount of revenue recognized reflects the consideration to which the Company expects to be entitled to receive in exchange for these services. To achieve this core principle, the Company applies the following five steps:

1) Identify the contract with a customer

A contract with a customer exists when (i) the Company enters into an enforceable contract with a customer that defines each party’s rights regarding the services to be transferred and identifies the payment terms related to these services, (ii) the contract has commercial substance and, (iii) the Company determines that collection of substantially all consideration for services that are transferred is probable based on the customer’s intent and ability to pay the promised consideration. The Company applies judgment in determining the customer’s ability and intention to pay, which is based on a variety of factors including the customer’s historical payment experience or, in the case of a new customer, published credit and financial information pertaining to the customer.

2) Identify the performance obligations in the contract

Performance obligations promised in a contract are identified based on the services that will be transferred to the customer that are both capable of being distinct, whereby the customer can benefit from the service either on its own or together with other resources that are readily available from third parties or from the Company, and are distinct in the context of the contract, whereby the transfer of the services is separately identifiable from other promises in the contract. To the extent a contract includes multiple promised services, the Company must apply judgment to determine whether promised services are capable of being distinct and distinct in the context of the contract. If these criteria are not met the promised services are accounted for as a combined performance obligation.

3) Determine the transaction price

The transaction price is determined based on the consideration to which the Company will be entitled in exchange for transferring services to the customer. To the extent the transaction price includes variable consideration, the Company estimates the amount of variable consideration that should be included in the transaction price utilizing either the expected value method or the most likely amount method depending on the nature of the variable consideration. Variable consideration is included in the transaction price if, in the Company’s judgment, it is probable that a significant future reversal of cumulative revenue under the contract will not occur. None of the Company's contracts as of June 30, 2018 contained a significant financing component. Determining the transaction price requires significant judgment, which is discussed by revenue category in further detail below.

9

4) Allocate the transaction price to performance obligations in the contract

If the contract contains a single performance obligation, the entire transaction price is allocated to the single performance obligation. However, if a series of distinct services that are substantially the same qualifies as a single performance obligation in a contract with variable consideration, the Company must determine if the variable consideration is attributable to the entire contract or to a specific part of the contract. For example, a bonus or penalty may be associated with one or more, but not all, distinct services promised in a series of distinct services that forms part of a single performance obligation. Contracts that contain multiple performance obligations require an allocation of the transaction price to each performance obligation based on a relative standalone selling price basis unless the transaction price is variable and meets the criteria to be allocated entirely to a performance obligation or to a distinct service that forms part of a single performance obligation. The Company determines standalone selling price based on the price at which the performance obligation is sold separately. If the standalone selling price is not observable through past transactions, the Company estimates the standalone selling price taking into account available information such as market conditions and internally approved pricing guidelines related to the performance obligations.

5) Recognize revenue when or as the Company satisfies a performance obligation

The Company satisfies performance obligations either over time or at a point in time. Revenue is recognized at the time the related performance obligation is satisfied by transferring a promised service to a customer.

Product revenue

Revenue from multiple-element arrangements is allocated among separate elements based on their estimated sales prices, provided the elements have value on a stand-alone basis.

Stock-Based Compensation

The Company recognizes compensation expense for all equity–based payments granted to employees in accordance with ASC 718 “Compensation – Stock Compensation”. Under fair value recognition provisions, the Company recognizes equity–based compensation net of an estimated forfeiture rate and recognizes compensation cost only for those shares expected to vest over the requisite service period of the award. 

Restricted stock awards are granted at the discretion of the Company. These awards are restricted as to the transfer of ownership and generally vest over the requisite service periods, typically over a five-year period (vesting on a straight–line basis). The fair value of a stock award is equal to the fair market value of a share of Company stock on the grant date. 

The fair value of an option award is estimated on the date of grant using the Black–Scholes option valuation model. The Black–Scholes option valuation model requires the development of assumptions that are inputs into the model. These assumptions are the value of the underlying share, the expected stock volatility, the risk–free interest rate, the expected life of the option, the dividend yield on the underlying stock and the expected forfeiture rate. Expected volatility is benchmarked against similar companies in a similar industry over the expected option life and other appropriate factors. Risk–free interest rates are calculated based on continuously compounded risk–free rates for the appropriate term. The dividend yield is assumed to be zero as the Company has never paid or declared any cash dividends on its Common stock and does not intend to pay dividends on its Common stock in the foreseeable future. The expected forfeiture rate is estimated based on management’s best estimate.  

Determining the appropriate fair value model and calculating the fair value of equity–based payment awards requires the input of the subjective assumptions described above. The assumptions used in calculating the fair value of equity–based payment awards represent management’s best estimates, which involve inherent uncertainties and the application of management’s judgment. As a result, if factors change and the Company uses different assumptions, our equity–based compensation could be materially different in the future. In addition, the Company is required to estimate the expected forfeiture rate and recognize expense only for those shares expected to vest. If the Company’s actual forfeiture rate is materially different from its estimate, the equity–based compensation could be significantly different from what the Company has recorded in the current period.

The Company accounts for share–based payments granted to non–employees in accordance with ASC 505-40, “Equity Based Payments to Non–Employees”. The Company determines the fair value of the stock–based payment as either the fair value of the consideration received or the fair value of the equity instruments issued, whichever is more reliably measurable. If the fair value of the equity instruments issued is used, it is measured using the stock price and other measurement assumptions as of the earlier of either (1) the date at which a commitment for performance by the counterparty to earn the equity instruments is reached, or (2) the date at which the counterparty’s performance is complete. The fair value of the equity instruments is re-measured each reporting period over the requisite service period.

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Income Taxes

Income taxes are provided in accordance with ASC No. 740, “Accounting for Income Taxes”. A deferred tax asset or liability is recorded for all temporary differences between financial and tax reporting and net operating loss carryforwards. Deferred tax expense (benefit) results from the net change during the period of deferred tax assets and liabilities.

Deferred tax assets are reduced by a valuation allowance when, in the opinion of management, it is more likely than not that some portion or all of the deferred tax assets will not be realized. Deferred tax assets and liabilities are adjusted for the effects of changes in tax laws and rates on the date of enactment. 

Management makes judgments as to the interpretation of the tax laws that might be challenged upon an audit and cause changes to previous estimates of tax liability. In addition, the Company operates within multiple taxing jurisdictions and is subject to audit in these jurisdictions. In management’s opinion, adequate provisions for income taxes have been made for all years. If actual taxable income by tax jurisdiction varies from estimates, additional allowances or reversals of reserves may be necessary. 

Loss Per Share

Basic net loss per common share is computed by dividing net loss attributable to common stockholders by the weighted-average number of common shares outstanding during the period. Diluted net loss per common share is determined using the weighted-average number of common shares outstanding during the period, adjusted for the dilutive effect of common stock equivalents. In periods when losses are reported, which is the case for the six months ended June 30, 2018 and 2017 presented in these consolidated financial statements, the weighted-average number of common shares outstanding excludes common stock equivalents because their inclusion would be anti-dilutive.

The Company had the following common stock equivalents at June 30, 2018 and 2017:

	June 30, 2018		June 30, 2017
Series A Preferred stock		23,135,935		21,654,614
Series B Preferred stock		4,697,906		4,431,987
Options		17,649,990		17,549,990
Warrants		62,016,795		22,805,981
Convertible notes - related party		10,027,507		250,000
Convertible notes		28,015,838		2,929,127
Totals		145,543,971		69,621,699

Reclassifications

Interest expense has been allocated to accretion of debt discount and issuance cost to conform to current period presentation.

Recently Adopted Accounting Guidance

In November 2016, the FASB issued ASU 2016-18, “Statement of Cash Flows (Topic 230)”, requiring that the statement of cash flows explain the change in the total cash, cash equivalents, and amounts generally described as restricted cash or restricted cash equivalents. This guidance is effective for fiscal years, and interim reporting periods therein, beginning after December 15, 2017 with early adoption permitted. The provisions of this guidance are to be applied using a retrospective approach which requires application of the guidance for all periods presented. The Company has adopted the methodologies prescribed by ASU 2016-18, the adoption of ASU 2016-18 did not have a material effect on its financial position or results of operations. 

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In May 2017, the FASB issued ASU 2017-09, “Compensation—Stock Compensation (Topic 718): Scope of Modification Accounting,” which provides guidance about which changes to the terms or conditions of a share-based payment award require an entity to apply modification accounting in Topic 718. This standard is required to be adopted in the first quarter of 2018. The Company has adopted the methodologies prescribed by ASU 2017-09, the adoption of ASU 2017-09 did not have a material effect on its financial position or results of operations. 

In July 2017, the FASB issued ASU 2017-11, “Earnings Per Share (Topic 260), Distinguishing Liabilities from Equity (Topic 480) and Derivatives and Hedging (Topic 815): I. Accounting for Certain Financial Instruments with Down Round Features; II. Replacement of the Indefinite Deferral for Mandatorily Redeemable Financial Instruments of Certain Nonpublic Entities and Certain Mandatorily Redeemable Noncontrolling Interests with a Scope Exception”. Part I of this update addresses the complexity of accounting for certain financial instruments with down round features. Down round features are features of certain equity-linked instruments (or embedded features) that result in the strike price being reduced on the basis of the pricing of future equity offerings. Current accounting guidance creates cost and complexity for entities that issue financial instruments (such as warrants and convertible instruments) with down round features that require fair value measurement of the entire instrument or conversion option. Part II of this update addresses the difficulty of navigating Topic 480, Distinguishing Liabilities from Equity, because of the existence of extensive pending content in the FASB Accounting Standards Codification. This pending content is the result of the indefinite deferral of accounting requirements about mandatorily redeemable financial instruments of certain nonpublic entities and certain mandatorily redeemable noncontrolling interests. The amendments in Part II of this update do not have an accounting effect. This ASU is effective for fiscal years, and interim periods within those years, beginning after December 15, 2018. The Company early adopted the ASU 2017-11 in the year ending December 31, 2017. 

Adoption of ASU 2017-11

As noted above, in connection with the securities purchase agreement and debt transactions during the year ended December 31, 2017, the Company issued warrants and convertible notes, to purchase common stock with an exercise price of $0.20 and a five-year term. Upon issuance of the warrants and convertible notes, the Company evaluated the note agreement to determine if the agreement contained any embedded components that would qualify the agreement as a derivative. The Company identified certain put features embedded in the warrants and convertible notes that potentially could result in a net cash settlement in the event of a fundamental transaction, requiring the Company to classify the warrants and convertible notes as a derivative liability. The Company changed its method of accounting for the convertible notes and warrants through the early adoption of ASU 2017-11 during the three months ended December 31, 2017 on a retrospective basis. Accordingly, the Company recorded the warrant derivative and conversion option derivative liabilities to additional paid in capital upon issuance.

Tabular summaries of the revisions and the corresponding effects on the statement of earnings for the six months ended June 30, 2017 are presented below:

Consolidated Statement of Operations Six Months Ended June 30, 2017
	Previously Reported			Revisions			Revised Reported
Accretion of debt discount and issuance cost	$	(951,484	)	$	226,584		$	(724,900	)
Derivative expense		(254,470	)		254,470			-
Change in fair value of derivative liabilities		584,011			(584,011	)		-
Net loss	$	(2,852,952	)	$	102,957		$	(2,955,909	)
Net loss per ordinary share:
Basic and diluted loss per share	$	(0.08	)	$	(0.00	)	$	(0.08	)

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Recent Accounting Guidance Not Yet Adopted

In February 2016, the FASB issued ASU 2016-02, “Leases (Topic 842).” Under ASU 2016-02, lessees will be required to recognize, for all leases of 12 months or more, a liability to make lease payments and a right-of-use asset representing the right to use the underlying asset for the lease term. Additionally, the guidance requires improved disclosures to help users of financial statements better understand the nature of an entity’s leasing activities. This ASU is effective for public reporting companies for interim and annual periods beginning after December 15, 2018, with early adoption permitted, and must be adopted using a modified retrospective approach. The Company is in the process of evaluating the effect of the new guidance on its condensed consolidated financial statements and disclosures.

In October 2016, the FASB issued ASU 2016-16, “Income Taxes (Topic 740): Intra-Entity Transfers of Assets Other than Inventory”, which eliminates the exception that prohibits the recognition of current and deferred income tax effects for intra-entity transfers of assets other than inventory until the asset has been sold to an outside party. The updated guidance is effective for annual periods beginning after December 15, 2019, including interim periods within those fiscal years. Early adoption of the update is permitted. The Company is currently evaluating the impact of the new standard.

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

Note 3 – Going Concern

The Company’s condensed consolidated financial statements have been prepared assuming that it will continue as a going concern, which contemplates continuity of operations, realization of assets, and liquidation of liabilities in the normal course of business. 

As reflected in the condensed consolidated financial statements, the Company had an accumulated deficit at June 30, 2018, a net loss and net cash used in operating activities for the reporting period then ended. These factors raise substantial doubt about the Company’s ability to continue as a going concern for a period of one year from the issuance of these financial statements.

The Company is attempting to further implement its business plan and generate sufficient revenues; however, its cash position may not be sufficient to support its daily operations. While the Company believes in the viability of its strategy to further implement its business plan and generate sufficient revenues and in its ability to raise additional funds by way of a public or private offering of its debt or equity securities, there can be no assurance to that effect. The ability of the Company to continue as a going concern is dependent upon its ability to further implement its business plan and generate sufficient revenues and its ability to raise additional funds by way of a public or private offering.

The condensed consolidated 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 the Company be unable to continue as a going concern.    

Note 4 – Property and Equipment

Property and equipment stated at cost, less accumulated depreciation and amortization, consisted of the following:

	June 30, 2018			December 31, 2017
Computer Equipment	$	234,315		$	234,315
Furniture and Fixtures		61,803			61,803
Leasehold Improvements		25,445			-
		321,563			296,118
Less: Accumulated Depreciation		(269,500	)		(248,062	)
	$	52,063		$	48,056

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Depreciation expense was $10,423 and $9,404 for the three months ended June 30, 2018 and 2017, respectively. Depreciation expense was $21,440 and $18,704 for the six months ended June 30, 2018 and 2017, respectively.

Note 5 – Line of Credit

Line of credit as of June 30, 2018 and December 31, 2017 is as follows:

	Outstanding Balances as of
	June 30, 2018		December 31, 2017
Revolving Note		-		44,996
	$	-	$	44,996

On March 19, 2009, Astoria Surgical Supplies North LLC signed a revolving note (the “Revolving Note”) at PNC Bank (the “Bank”). The outstanding balance of this Revolving Note is limited to $200,000 and expired March 19, 2010. The outstanding balance accrues interest at a variable rate. The interest rate is subject to change based on changes in an independent index which is the highest Prime Rate as published in the “Money Rates” section of the Wall Street Journal. The Company had been in payment default since March 19, 2010; however, on May 3, 2017, the Company agreed to pay back the line of credit by December 1, 2017. On March 23, 2018 the Company sent the final payment for the Revolving note and the Revolving Note was fully satisfied.

The balance outstanding on the Revolving Note at June 30, 2018 and December 31, 2017 was $0 and $44,996, respectively.

Note 6 – Notes Payable

Notes payable as of June 30, 2018 and December 31, 2017 is as follows:

	Outstanding Principal as of										Warrants
	June 30, 2018			December 31, 2017			Interest Rate			Maturity Date	Quantity		Exercise Price
The February 2017 Offering	$	364,325		$	400,000			12	%	September 1, 2017		2,450,000	$	0.20
The June 2017 Loan Agreement		-			50,000			12	%	September 1, 2017		35,000		0.20
The First November 2017 Loan Agreement		-			100,000			15	%	January 12, 2018		-		-
The Second November 2017 Loan Agreement		-			50,000			15	%	January 13, 2018		-		-
The Third November 2017 Loan Agreement		-			100,000			15	%	January 13, 2018		-		-
May 2018 Offering		608,500			-			13	%	March 2019		1,825,500		-
		972,825			700,000
Less: Debt Discount		(180,950	)		(10,500	)
Less: Debt Issuance Costs		(408	)		-
	$	791,467		$	689,500

Private Placement Offerings:

The February 2017 Offering

From February 24, 2017 through March 17, 2017, the Company conducted multiple closings of a private placement offering (the “February 2017 Offering”) of the Company’s securities by entering into subscription agreements (the “Subscription Agreements”) with accredited investors (the “Accredited Investors”) for aggregate gross proceeds of $916,585 for which the Accredited Investors received $975,511 in principal value of secured promissory notes with an original issue discount of six percent (6%) (the “February 2017 Offering Notes”) and warrants to purchase the Company’s common stock (the “February 2017 Offering Warrants”). 

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The February 2017 Offering Notes are convertible into shares of the Company’s common stock at the time of Company’s next round of financing (the “Subsequent Offering”) at a price equal to eighty-five percent (85%) of the price per share offered in the Subsequent Offering (the “Conversion Price”). The February 2017 Offering Warrants have a five-year term. Investors received the February 2017 Offering Warrants in the following amounts: (i) Investors purchasing $150,000 or more of the Offering received a February 2017 Offering Warrant equal to one hundred thirty percent (130%) of the dollar amount invested in the Offering; (ii) investors purchasing at least $100,000 but less than $150,000 of the February 2017 Offering received a February 2017 Offering Warrant equal to one hundred percent (100%) of the dollar amount invested in the Offering; and (iii) investors purchasing less than $100,000 of the Offering received to a February 2017 Offering Warrant equal to seventy percent (70%) of the dollar amount invested in the Offering. The Warrants entitle the holder to purchase shares of the Company’s common stock at $0.20 per share (the “Exercise Price”).

The Conversion Price and the Exercise Price are subject to adjustments for issuances of (i) the Company’s common stock, (ii) any equity linked instruments or (iii) securities convertible into the Company’s common stock, at a purchase price of less than the prevailing Conversion Price or Exercise Price. Such adjustments shall result in the Conversion Price or Exercise Price being reduced to such lower purchase price, as described in the February 2017 Offering Notes and the February 2017 Offering Warrants.

Pursuant to the Subscription Agreements, the February 2017 Offering Notes matured on September 1, 2017 (the “February 2017 Offering Maturity Date”). Prior to the February 2017 Offering Maturity Date, investors representing $575,511 in principal value converted their February 2017 Offering Notes into two year, 15% secured convertible promissory notes offered by the Company (the “August 2017 Convertible Note Offering”). The remaining investors representing an aggregate $400,000 in principal of the February 2017 Offering Notes agreed to forbear their right to declare an event of default until December 15, 2017 during which time they retain the right to convert their principal and any accrued but unpaid interest into the August 2017 Convertible Note Offering. In consideration of the forbearance for which the investors will receive a warrant to purchase up to fifteen percent (15%) of the shares of common stock underlying the warrant acquired with the purchase of the February 2017 Offering Notes at a purchase price of $0.20 per share, and the interest on their note would be increased to eighteen percent (18%) from September 1, 2017 through December 15, 2017 or the conversion date, whichever is sooner. During the six months ended June 30, 2018 the Company has repaid $26,500 in principal and $26,375 in interest.

The June 2017 Loan Agreement

On June 12, 2017, the Company entered into a loan agreement (the “June 2017 Loan Agreement”) with an individual (the “June 2017 Lender”), the June 2017 Lender issued the Company a promissory note of $50,000 (the “June 2017 Note”). Pursuant to the June 2017 Loan Agreement, the June 2017 Note bears interest at a rate of 10% per annum. As additional consideration for entering in the June 2017 Loan Agreement, the Company issued the June 2017 Lender a five-year warrant to purchase 35,000 shares of the Company’s common stock with an exercise price of $0.20 per share. The maturity date of the June 2017 Note was September 1, 2017 (the “June 2017 Maturity Date”) at which time all outstanding principal, accrued and unpaid interest and other amounts due under the June 2017 Note were due. During the six months ended June 30, 2018 the Company has repaid $50,000 in principal and the debtor has forgiven the interest of $4,424 this was recorded as a gain on forgiveness of debt.

The First November 2017 Loan Agreement

On November 28, 2017, the Company entered into a loan agreement (the “First November 2017 Loan Agreement”) with an individual (the “First November 2017 Lender”), the First November 2017 Lender issued the Company a promissory note of $100,000 (the “First November 2017 Note”). Pursuant to the First November 2017 Loan Agreement, the First November 2017 Note has interest of fifteen percent (15%), (i) five percent (5%) (i.e. $5,000) shall be payable in cash or convertible into shares of the Company’s restricted common stock at a rate of $0.20 per share, at the option of the Lender, at the Maturity Date; (ii) ten percent (10%) (i.e. $10,000) shall be paid in the form of the Company’s restricted common stock at a rate of $0.20 per share (equivalent to 50,000 shares of the Company’s common stock ). The maturity date of the First November 2017 Note was January 12, 2018 (the “First November 2017 Maturity Date”) at which time all outstanding principal, accrued and unpaid interest and other amounts due under the First November 2017 Note are due. On January 12, 2018, the First November 2017 Note and accrued but unpaid interest was converted into the Company’s August 2017 Convertible Note Offering.

The Second November 2017 Loan Agreement

On November 29, 2017, the Company entered into a loan agreement (the “Second November 2017 Loan Agreement”) with an individual (the “Second November 2017 Lender”), the Second November 2017 Lender issued the Company a promissory note of $50,000 (the “Second November 2017 Note”). Pursuant to the Second November 2017 Loan Agreement, the Second November 2017 Note has interest of fifteen percent (15%), (i) five percent (5%) (i.e. $2,500) shall be payable in cash or convertible into shares of the Company’s restricted common stock at a rate of $0.20 per share, at the option of the Lender, at the Maturity Date; (ii) ten percent (10%) (i.e. $5,000) shall be paid in the form of the Company’s restricted common stock at a rate of $0.20 per share (equivalent to 25,000 shares of the Company’s common stock ). The maturity date of the Second November 2017 Note was January 13, 2018 (the “Second November 2017 Maturity Date”) at which time all outstanding principal, accrued and unpaid interest and other amounts due under the Second November 2017 Note are due. On January 12, 2018, the Second November 2017 Note and accrued but unpaid interest was converted into the Company’s August 2017 Convertible Note Offering.

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The Third November 2017 Loan Agreement

On November 29, 2017, the Company entered into a loan agreement (the “Third November 2017 Loan Agreement”) with an individual (the “Third November 2017 Lender”), the Third November 2017 Lender issued the Company a promissory note of $100,000 (the “Third November 2017 Note”). Pursuant to the Third November 2017 Loan Agreement, the Third November 2017 Note has interest of fifteen percent (15%), (i) five percent (5%) (i.e. $5,000) shall be payable in cash or convertible into shares of the Company’s restricted common stock at a rate of $0.20 per share, at the option of the Lender, at the Maturity Date; (ii) ten percent (10%) (i.e. $10,000) shall be paid in the form of the Company’s restricted common stock at a rate of $0.20 per share (equivalent to 50,000 shares of the Company’s common stock). The maturity date of the Third November 2017 Note was January 13, 2018 (the “Third November 2017 Maturity Date”) at which time all outstanding principal, accrued and unpaid interest and other amounts due under the Third November 2017 Note are due. On January 12, 2018, the Third November 2017 Note and accrued but unpaid interest was converted into the Company’s August 2017 Convertible Note Offering.

 On March 14, 2018, the Company entered into a loan agreement (the “March 2018 Loan Agreement”) with an individual (the “March 2018 Lender”), the March 2018 Lender issued the Company a promissory note of $50,000 (the “March 2018 Note”). Pursuant to the March 2018 Loan Agreement, the March 2018 Note bears interest at a rate of 12% per annum. As additional consideration for entering in the March 2018 Loan Agreement, the Company issued the March 2018 Lender a five-year warrant to purchase 100,000 shares of the Company’s common stock with an exercise price of $0.20 per share. The maturity date of the March 2018 Note was March 29, 2018 (the “March 2018 Maturity Date”) at which time all outstanding principal, accrued and unpaid interest and other amounts due under the March 2018 Note were due. On March 29, 2018, the March 2018 Note and accrued but unpaid interest was converted into the Company’s March 2018 Convertible Note Offering.

The May 2018 Offering

During the months of May and June 2018, the Company conducted multiple closings with accredited investors (the “May 2018 Offering”) of units of the Company’s securities by entering into subscription agreements with “accredited investors” (the “Investors”) for aggregate gross proceeds of $658,500.

The May 2018 Offering consisted of a maximum of $1,200,000 of units of the Company’s securities (each, a “Unit” and collectively, the “Units”), with each Unit consisting of (i) a 13% promissory note (each, a “ May 2018 Offering Note” and, together, the “May 2018 Offering Notes”), and (ii) a four-year warrant (“May 2018 Offering Warrant”) to purchase the number of shares of the Company’s common stock equal to three times the principal amount in dollars invested by such investor in each May 2018 Offering Note (the “May 2018 Warrant Shares”) at an exercise price of $0.20 per share (the “May Offering Warrant Exercise Price”), subject to adjustment upon the terms thereof. The May 2018 Offering Notes mature on the nine-month anniversary of their issuance dates.

The Company recorded a $215,032 debt discount relating to 1,825,500 May 2018 Offering Warrants issued to investors based on the relative fair value of each equity instrument on the dates of issuance. The debt discount is being accreted over the life of the note to accretion of debt discount and issuance cost.

The May Offering Warrant Exercise Price of the May 2018 Offering Warrants are subject to adjustment for issuances of the Company’s common stock or any equity linked instruments or securities convertible into the Company’s common stock at a purchase price of less than the prevailing May 2018 Offering Warrant Exercise Price. Such adjustment shall result in the May 2018 Offering Warrant Exercise Price being reduced to such lower purchase price, subject to carve-outs as described therein.

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Note 7 – Convertible Note Payable

Convertible notes payable as of June 30, 2018 and December 31, 2017 is as follows: 

	Outstanding Principal as of													Warrants
	June 30, 2018			December 31, 2017			Interest Rate			Conversion Price			Maturity Date	Quantity		Exercise Price
The November 2016 Convertible Note Offering	$	25,000		$	25,000			10	%		0.30		November 1, 2017		400,000	$	0.30
The June 2017 Convertible Note Offering		-			71,500			12	%		Not Applicable		September 1, 2017		114,700		0.20
The August 2017 Convertible Note Offering		2,943,884			2,943,884			15	%		0.20	(*)	August – November 2019		14,716,419		0.20
The First December 2017 Note		100,000			100,000			15	%		0.20	(*)	December 21, 2019		500,000		0.20
The February 2018 Convertible Note Offering		1,015,674			-			15	%		0.20	(*)	January – February 2020		5,078,375		0.20
The January 2018 Note		68,761			-						0.20	(*)	January 12, 2020		343,806		0.20
The February 2018 Note		35,452			-			18	%		0.20	(*)	February 8, 2020		81,500		0.20
The March 2018 Convertible Note Offering		961,367			-			14	%		0.20	(*)	March – April 2020		4,806,833		0.20
		5,150,138			3,140,384
Less: Debt Discount		(828,627	)		(452,022	)
Less: Debt Issuance Costs		(219,204	)		(79,569	)
		4,102,307			2,608,793
Less: Current Debt		(59,499	)		(96,500	)
Total Long-Term Debt	$	4,042,808		$	2,512,293

(*) As subject to adjustment as further outlined in the notes

The November 2016 Convertible Note Offering

During the months of November and December 2016, the Company issued convertible notes to third party lenders totaling $400,000 (the “November 2016 Convertible Note Offering”). These notes accrue interest at a rate of 10% per annum and mature with interest and principal both due between November 1, 2017 through December 29, 2017. The notes and accrued interest are convertible at a conversion price as defined therein. In addition, in connection with the notes the Company issued five-year warrants to purchase an aggregate of 400,000 shares of Company common stock at a purchase price of $0.30 per share. The investors converted $375,000 of principal and $30,719 of interest into the August 2017 Convertible Note Offering. 

The June 2017 Convertible Note Offering

During the month of June 2017 the Company issued convertible notes to third party lenders totaling $71,500. The notes accrue interest at 12% per annum and mature with interest and principal both due on September 1, 2017. The notes and accrued interest may be converted into a subsequent offering at a 15% discount to the offering price are convertible at a conversion price as defined therein. In addition, the Company issued warrants to purchase 67,550 shares of Company common stock. The warrants entitle the holders to purchase the Company’s common stock at a purchase price of $0.20 per share for a period of five years from the issue date. As of December 31, 2017, the Company was currently in default on $71,500 in principal due on the notes.  On February 8, 2018, the Company repurchased these notes and is no longer in default.

The August 2017 Convertible Note Offering

From August through November of 2017, the Company conducted multiple closings of a private placement offering to accredited investors (the “August 2017 Convertible Note Offering”) of units of the Company’s securities by entering into subscription agreements with “accredited investors” (the “Investors”) for aggregate gross proceeds of $1,585,000. In addition, $1,217,177 of the Company’s short-term debt along with accrued but unpaid interest of $40,146 was converted into the August 2017 Convertible Note Offering. The conversions resulted in the issuance of 6,791,419 warrants with a fair value of $583,681 and an original issue discount of $101,561. These were recorded as a loss on extinguishment of debt.

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The August 2017 Convertible Note Offering consisted of a maximum of $6,000,000 of units of the Company’s securities (each, a “Unit” and collectively, the “Units”), with each Unit consisting of (a) a 15% Convertible Secured Promissory Note (each a “August 2017 Offering Note” and together the “August 2017 Offering Notes”), convertible into shares of the Company’s common stock, par value $.001 per share (“August 2017 Offering Conversion Shares”) at a conversion price of $0.20 per share (the “August 2017 Note Conversion Price”), and (b) a five-year warrant (each a “August 2017 Offering Warrant and together the “August 2017 Offering Warrants”) to purchase common stock equal to one hundred percent (100%) of the shares into which the August 2017 Offering Notes can be converted into (“August 2017 Offering Warrant Shares”) at an exercise price of $0.20 per share (“August 2017 Offering Warrant Exercise Price”). The August 2017 Offering Notes mature on the second (2nd) anniversary of their issuance dates.

The August 2017 Note Conversion Price and the August 2017 Offering Warrant Exercise Price are subject to adjustment for issuances of the Company’s common stock or any equity linked instruments or securities convertible into the Company’s common stock at a purchase price of less than the prevailing August 2017 Note Conversion Price or August 2017 Offering Warrant Exercise Price. Such adjustment shall result in the August 2017 Note Conversion Price and August 2017 Offering Warrant Exercise Price being reduced to such lower purchase price, subject to carve-outs as described therein.

The Company recorded a $472,675 debt discount relating to 7,925,000 August 2017 Offering Warrants issued to investors based on the relative fair value of each equity instrument on the dates of issuance. The debt discount is being accreted over the life of the note to accretion of debt discount and issuance cost.

In connection with the August 2017 Convertible Note Offering, the Company paid a placement agent a cash fee of $90,508 to for services rendered in connection therewith on a “best-efforts” basis, which was recorded as issuance cost and is being accreted over the life of the note to accretion of debt discount and issuance cost. 

The First December 2017 Note

On December 27, 2017, the Company issued a convertible note to a third-party lender totaling $100,000 (the “First December 2017 Note”). The First December 2017 Note accrues interest at 15% per annum and matures with interest and principal both due on December 27, 2019. In addition, the Company issued a warrant to purchase 500,000 shares of Company common stock. The warrant entitles the holder to purchase the Company’s common stock at a purchase price of $0.20 per share for a period of five years from the issue date. The Company recorded a $35,525 debt discount relating to the warrants issued to the investor based on the relative fair value of each equity instrument on the dates of issuance. The debt discount is being accreted over the life of the note The First December 2017 Note and accrued interest is convertible at a conversion price of $0.20 per share, subject to adjustment. The First December 2017 Note is secured by a second priority lien on the assets of the Company.

The February 2018 Convertible Note Offering

During the six months ended June 30, 2018, the Company conducted multiple closings of a private placement offering to accredited investors (the “February 2018 Convertible Note Offering”) of units of the Company’s securities by entering into subscription agreements with “accredited investors” (the “Investors”) for aggregate gross proceeds of $725,000. In addition, $250,000 of the Company’s short-term debt along with accrued but unpaid interest of $40,675 was converted into the February 2018 Offering. The conversions resulted in the issuance of 1,453,375 warrants with a fair value of $181,139. These were recorded as a loss on extinguishment of debt.

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The February 2018 Convertible Note Offering consisted of a maximum of $750,000 of units of the Company’s securities (each, a “Unit” and collectively, the “Units”), with each Unit consisting of (a) a 15% Convertible Secured Promissory Note (each a “February 2018 Convertible Note” and together the “February 2018 Convertible Notes”), convertible into shares of the Company’s common stock, par value $.001 per share (“February 2018 Conversion Shares”) at a conversion price of $0.20 per share (the “February 2018 Note Conversion Price”), and (b) a five-year warrant (each a “February 2018 Offering Warrant and together the “February 2018 Offering Warrants”) to purchase common stock equal to one hundred percent (100%) of the shares into which the February 2018 Convertible Notes can be converted into (“February 2018 Warrant Shares”) at an exercise price of $0.20 per share (“February 2018 Warrant Exercise Price”). The February 2018 Offering Notes mature on the second (2nd) anniversary of their issuance dates. The February 2018 Offering Notes are secured by a second priority security interest in the Company’s assets up to $1,000,000.

The February 2018 Note Conversion Price and the February 2018 Offering Warrant Exercise Price are subject to adjustment for issuances of the Company’s common stock or any equity linked instruments or securities convertible into the Company’s common stock at a purchase price of less than the prevailing Conversion Price or Exercise Price. Such adjustment shall result in the Conversion Price and Exercise Price being reduced to such lower purchase price, subject to carve-outs as described therein.

The conversion feature of the February 2018 Convertible Note Offering provides for an effective conversion price that is below market value on the date of issuance. Such feature is normally characterized as a beneficial conversion feature (“BCF”). When the Company records a BCF the relative fair value of the BCF is recorded as a debt discount against the face amount of the respective debt instrument. The Company recorded a BCF and related debt discount of $37,350, the discount is being accreted over the life of the first Debenture to accretion of debt discount and issuance cost.

The Company recorded a $316,875 debt discount relating to 3,625,000 February 2018 Offering Warrants issued to investors based on the relative fair value of each equity instrument on the dates of issuance. The debt discount is being accreted over the life of the note to accretion of debt discount and issuance cost.

In connection with the February 2018 Convertible Note Offering, the Company retained a placement agent (the “Placement Agent”), to carry out the Offering on a “best-efforts” basis. For services in its capacity as Placement Agent, the Company has paid the Placement Agent a cash fee of $94,250 and issued to the Placement Agent shares of the Company’s common stock equal to ten percent (13%) of the Conversion Shares underlying the February 2018 Convertible Notes or 362,500 shares that had a fair value of $74,881, which was recorded as issuance cost and is being accreted over the life of the note to accretion of debt discount and issuance cost.

The January 2018 Note

On January 12, 2018, the Company issued a convertible note to a third-party lender totaling $68,761 to settle an outstanding vendor liabilities (the “January 2018 Note”). The January 2018 Note accrues interest at 15% per annum and matures with interest and principal both due on January 12, 2020. The conversions resulted in the issuance of 343,806 warrants with a fair value of $42,850. These were recorded as a loss on extinguishment of debt. The warrant entitles the holder to purchase the Company’s common stock at a purchase price of $0.20 per share for a period of five years from the issue date. The January 2018 Note and accrued interest is convertible at a conversion price of $0.20 per share, subject to adjustment. The January 2018 Note is secured by a second priority lien on the assets of the Company.

The February 2018 Note

On February 8, 2018, the Company issued a convertible note to a third-party lender totaling $40,750 (the “February 2018 Note”). The February 2018 Note accrues interest at 18% per annum and matures with interest and principal both due on February 8, 2020. In addition, the Company issued a warrant to purchase 81,500 shares of Company common stock. The warrant entitles the holder to purchase the Company’s common stock at a purchase price of $0.20 per share for a period of five years from the issue date. The Company recorded a $7,963 debt discount relating to the warrants issued to the investor based on the relative fair value of each equity instrument on the dates of issuance and an original issue discount of $5,298. The debt discount is being accreted over the life of the note. The February 2018 Note and accrued interest is convertible at a conversion price of $0.20 per share, subject to adjustment. The February 2018 Note is secured by a second priority lien on the assets of the Company. During the six months ended the company has repaid $5,298 in principal.

The March 2018 Convertible Note Offering

During the six months ended June 30, 2018, the Company conducted multiple closings of a private placement offering to accredited investors (the “March 2018 Convertible Note Offering”) of units of the Company’s securities by entering into subscription agreements with “accredited investors” (the “Investors”) for aggregate gross proceeds of $770,000. In addition, $50,000 of the Company’s short-term debt, $767 accrued but unpaid interest and $140,600 of the Company’s vendor liabilities was converted into the March 2018 Convertible Note Offering. The conversions resulted in the issuance of 956,833 warrants with a fair value of $84,087. These were recorded as a loss on extinguishment of debt.

The March 2018 Convertible Note Offering consisted of a maximum of $900,000, with an over-allotment option of an additional $300,000 of units of the Company’s securities (each, a “Unit” and collectively, the “Units”), with each Unit consisting of (a) a 14% Convertible Secured Promissory Note (each a “Note” and together the “Notes”), convertible into shares of the Company’s common stock, par value $.001 per share (“Conversion Shares”) at a conversion price of $0.20 per share (the “Conversion Price”), and (b) a four-year warrant (each a “Warrant and together the “Warrants”) to purchase common stock equal to one hundred percent (100%) of the shares into which the Notes can be converted into (“Warrant Shares”) at an exercise price of $0.20 per share (“Exercise Price”). The Notes mature on the second (2nd) anniversary of their issuance dates.

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The Conversion Price of the Note and the Exercise Price of the Warrants are subject to adjustment for issuances of the Company’s common stock or any equity linked instruments or securities convertible into the Company’s common stock at a purchase price of less than the prevailing Conversion Price or Exercise Price. Such adjustment shall result in the Conversion Price and Exercise Price being reduced to such lower purchase price, subject to carve-outs as described therein.

The Company recorded a $254,788 debt discount relating to 4,806,833 warrants issued to investors based on the relative fair value of each equity instrument on the dates of issuance. The debt discount is being accreted over the life of the note to accretion of debt discount and issuance cost.

Note 8 – Related Party Loans

Convertible notes

Convertible notes payable – related party as of June 30, 2018 and December 31, 2017 is as follows:

	Outstanding Principal as of										Warrants
	June 30, 2018			December 31, 2017			Interest Rate			Maturity Date	Quantity		Exercise Price
The August 2017 Convertible Note Offering	$	1,416,026		$	1,416,026			15	%	August – October 2019		4,589,466	$	0.20
The Second December 2017 Note		100,000			100,000			15	%	December 21, 2019		500,000		0.20
The February 2018 Convertible Note Offering		25,000			-			15	%	January – February 2020		125,000		0.20
The Second February 2018 Note		35,452			-			20	%	September 30, 2018		81,500		0.20
The March 2018 Convertible Note Offering		239,400			-			14	%	March 2020		1,197,000		0.20
		1,815,878			1,516,026
Less: Debt Discount		(208,525	)		(170,780	)
Less: Debt Issuance Costs		(4,645	)		-
		1,602,708			1,345,246
Less: Current Debt		(30,916	)		-
Total Long-Term Debt	$	1,571,792		$	1,345,246

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The August 2017 Convertible Note Offering 

During the year ended December 31, 2017, the Company conducted multiple closings of a private placement offering to accredited investors (the “The August 2017 Convertible Offering”) of units of the Company’s securities by entering into subscription agreements with “accredited investors” (the “Investors”) for aggregate gross proceeds of $505,000. In addition, $645,000 of the Company’s short-term debt along with accrued but unpaid interest of $206,026 was converted into the August 2017 Convertible Offering. The conversions resulted in the issuance of 4,555,129 warrants with a fair value of $440,157 and the increase of principal of $60,000. These resulted in a loss on extinguishment of debt of $500,157.

The Company offered, through a placement agent, $6,000,000 of units of its securities (each, a “Unit” and collectively, the “Units”), with each Unit consisting of (a) a 15% Convertible Secured Promissory Note (each a “Note” and together the “Notes”), convertible into shares of the Company’s common stock, par value $.001 per share (“Conversion Shares”) at a conversion price of $0.20 per share (the “Conversion Price”), and (b) a five-year warrant (each a “Warrant and together the “Warrants”) to purchase common stock equal to one hundred percent (100%) of the shares into which the Notes can be converted into (“Warrant Shares”) at an exercise price of $0.20 per share (“Exercise Price”). The Notes mature on the second (2nd) anniversary of their issuance dates. 

The Conversion Price of the Note and the Exercise Price of the Warrants are subject to adjustment for issuances of the Company’s common stock or any equity linked instruments or securities convertible into the Company’s common stock at a purchase price of less than the prevailing Conversion Price or Exercise Price. Such adjustment shall result in the Conversion Price and Exercise Price being reduced to such lower purchase price, subject to carve-outs as described therein.

The Company recorded a $160,700 debt discount relating to 2,525,000 warrants issued to investors based on the relative fair value of each equity instrument on the dates of issuance. The debt discount is being accreted over the life of the note to accretion of debt discount and issuance cost.

The Second December 2017 Note

On December 21, 2017, the Company issued a convertible note to a third-party lender totaling $100,000 (the “Second December 2017 Note”). The Second December 2017 Note accrues interest at 15% per annum and matures with interest and principal both due on December 27, 2019. In addition, the Company issued a warrant to purchase 500,000 shares of Company common stock. The warrant entitles the holder to purchase the Company’s common stock at a purchase price of $0.20 per share for a period of five years from the issue date. The Company recorded a $36,722 debt discount relating to the warrants issued to the investor based on the relative fair value of each equity instrument on the dates of issuance. The debt discount is being accreted over the life of the note The Second December 2017 Note and accrued interest is convertible at a conversion price of $0.20 per share, subject to adjustment. The Second December 2017 Note is secured as a second priority lien on the assets of the Company.

The February 2018 Convertible Note Offering

During the six months ended June 30, 2018, the Company conducted multiple closings of a private placement offering to accredited investors (the “February 2018 Convertible Note Offering”) of units of the Company’s securities by entering into subscription agreements with “accredited investors” (the “Investors”) for aggregate gross proceeds of $25,000.

The February 2018 Convertible Note Offering consisted of a maximum of $750,000 of units of the Company’s securities (each, a “Unit” and collectively, the “Units”), with each Unit consisting of (a) a 15% Convertible Secured Promissory Note (each a “Note” and together the “Notes”), convertible into shares of the Company’s common stock, par value $.001 per share (“Conversion Shares”) at a conversion price of $0.20 per share (the “Conversion Price”), and (b) a five-year warrant (each a “Warrant and together the “Warrants”) to purchase common stock equal to one hundred percent (100%) of the shares into which the Notes can be converted into (“Warrant Shares”) at an exercise price of $0.20 per share (“Exercise Price”). The Notes mature on the second (2nd) anniversary of their issuance dates. The Notes are secured by a second priority security interest in the Company’s assets up to $1,000,000.

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The Conversion Price of the Note and the Exercise Price of the Warrants are subject to adjustment for issuances of the Company’s common stock or any equity linked instruments or securities convertible into the Company’s common stock at a purchase price of less than the prevailing Conversion Price or Exercise Price. Such adjustment shall result in the Conversion Price and Exercise Price being reduced to such lower purchase price, subject to carve-outs as described therein.

The conversion feature of the February 2018 Convertible Note Offering provides for an effective conversion price that is below market value on the date of issuance. Such feature is normally characterized as a beneficial conversion feature (“BCF”). When the Company records a BCF the relative fair value of the BCF is recorded as a debt discount against the face amount of the respective debt instrument. The Company recorded a BCF and related debt discount of $1,063, the discount is being accreted over the life of the first Debenture to accretion of debt discount and issuance cost.

The Company recorded a $11,054 debt discount relating to 125,000 warrants issued to investors based on the relative fair value of each equity instrument on the dates of issuance. The debt discount is being accreted over the life of the note to accretion of debt discount and issuance cost.

In connection with the Offering, the Company retained the Placement Agent, to carry out the Offering on a “best-efforts” basis. For services in its capacity as Placement Agent, the Company has paid the Placement Agent a cash fee of $3,250 and issued to the Placement Agent shares of the Company’s common stock equal to ten percent (10%) of the Conversion Shares underlying the Notes or 12,500 shares that had a fair value of $2,606, which was recorded as issuance cost and is being accreted over the life of the note to accretion of debt discount and issuance cost.

The Second February 2018 Note

On February 8, 2018, the Company issued a convertible note to a third-party lender totaling $40,750 (the “Second February 2018 Note”). The Second February 2018 Note accrues interest at 18% per annum and matures with interest and principal both due on September 30, 2018. In addition, the Company issued a warrant to purchase 81,500 shares of Company common stock. The warrant entitles the holder to purchase the Company’s common stock at a purchase price of $0.20 per share for a period of five years from the issue date. The Company recorded a $7,963 debt discount relating to the warrants issued to the investor based on the relative fair value of each equity instrument on the dates of issuance and an original issue discount of $5,298. The debt discount is being accreted over the life of the note The Second February 2018 Note and accrued interest is convertible at a conversion price of $0.20 per share, subject to adjustment. The Second February 2018 Note is secured as a second priority lien on the assets of the Company. During the six months ended the company has repaid $5,298 in principal.

The March 2018 Convertible Note Offering

During the six months ended June 30, 2018, the Company conducted multiple closings of a private placement offering to accredited investors (the “March 2018 Convertible Note Offering”) of units of the Company’s securities by entering into subscription agreements with “accredited investors” (the “Investors”) for aggregate gross proceeds of $239,400.

The March 2018 Convertible Note Offering consisted of a maximum of $900,000, with an over-allotment option of an additional $300,000, of units of the Company’s securities (each, a “Unit” and collectively, the “Units”), with each Unit consisting of (a) a 14% Convertible Secured Promissory Note (each a “Note” and together the “Notes”), convertible into shares of the Company’s common stock, par value $.001 per share (“Conversion Shares”) at a conversion price of $0.20 per share (the “Conversion Price”), and (b) a four-year warrant (each a “Warrant and together the “Warrants”) to purchase common stock equal to one hundred percent (100%) of the shares into which the Notes can be converted into (“Warrant Shares”) at an exercise price of $0.20 per share (“Exercise Price”). The Notes mature on the second (2nd) anniversary of their issuance dates.

The Conversion Price of the Note and the Exercise Price of the Warrants are subject to adjustment for issuances of the Company’s common stock or any equity linked instruments or securities convertible into the Company’s common stock at a purchase price of less than the prevailing Conversion Price or Exercise Price. Such adjustment shall result in the Conversion Price and Exercise Price being reduced to such lower purchase price, subject to carve-outs as described therein.

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The Company recorded a $84,854 debt discount relating to 1,197,000 warrants issued to investors based on the relative fair value of each equity instrument on the dates of issuance. The debt discount is being accreted over the life of the note to accretion of debt discount and issuance cost.

Notes payable

Notes payable – related party as of June 30, 2018 and December 31, 2017 is as follows:

	Outstanding Principal as of									Warrants
	June 30, 2018			December 31, 2017		Interest Rate			Maturity Date	Quantity		Exercise Price
The May 2016 Rosen Loan Agreement	$	1,000,000		$	1,000,000		13	%	November 26, 2017		1,000,000	$	0.40
The September 2017 Rosen Loan Agreement		224,000			224,000		18	%	September 24, 2017		125,000		0.20
The November 2017 Schiller Loan Agreement		-			25,000		15	%	December 31, 2017		-		-
The May 2018 Schiller Loan Agreement		100,000			-		13	%	February 2, 2019		300,000		0.20
The June 2018 Frommer Loan Agreement		10,000			-		6	%	August 17, 2018		30,000		0.20
		1,334,000			1,249,000
Less: Current Debt		(28,093	)		-
	$	1,305,907		$	1,249,000

The May 2016 Rosen Loan Agreement

On May 26, 2016, the Company entered into a loan agreement (the “May 2016 Rosen Loan Agreement”) with Arthur Rosen, an individual (“Rosen”), pursuant to which on May 26, 2016 (the “Closing Date”), Rosen provided the Company a secured term loan of $1,000,000 (the “May 2016 Rosen Loan”). In connection with the May 2016 Rosen Loan Agreement, on May 26, 2016, the Company and Rosen entered into a security agreement (the “Rosen Security Agreement”), pursuant to which the Company granted to Rosen a senior security interest in substantially all of the Company’s assets as security for repayment of the May 2016 Rosen Loan. Pursuant to the May 2016 Rosen Loan Agreement, the May 2016 Rosen Loan bears interest at a rate of 12.5% per annum, compounded annually and payable on the maturity date of May 26, 2017 (the “May 2016 Rosen Maturity Date”) at which time all outstanding principal, accrued and unpaid interest and other amounts due under the May 2016 Rosen Loan are due. The Company entered into an amendment to the May 2016 Rosen Loan extending the May 2016 Rosen Maturity Date to November 26, 2017. As additional consideration for entering in the May 2016 Rosen Loan Agreement, the Company issued Rosen a five-year warrant to purchase 1,000,000 shares of the Company’s common stock at a purchase price of $0.40 per share (the “May 2016 Rosen Warrant”). The May 2016 Rosen Warrant contains anti-dilution provisions as further described therein. On September 7, 2017 (the “Conversion Date”), Rosen converted all accrued but unpaid interest on the May 2016 Rosen Loan from May 26, 2016 through September 6, 2017 in the amount of $150,128 (the “May 2016 Rosen Loan Interest”) into the Company’s August Convertible Note Offering, after which May 2016 Rosen Loan Interest was deemed paid in full through the Conversion Date. 

The September 2017 Rosen Loan Agreement

On September 8, 2017, the Company entered into a loan agreement (the “September 2017 Rosen Loan Agreement”) with Rosen, whereby the Company issued Rosen a promissory note of $224,000 (the “September 2017 Rosen Note”). The September 2017 Rosen Note is secured by an officer of the Company. As additional consideration for entering in the September 2017 Rosen Note Loan Agreement, the Company issued Rosen a five-year warrant to purchase 25,000 shares of the Company’s common stock at a purchase price of $0.20 per share. On November 13, 2017, in consideration for extending the Promissory Note, Rosen was issued a warrant to purchase 100,000 shares of the Company’s Common Stock exercisable within five (5) years and with an exercise price of $0.20 per share. On February 20, 2018 the company entered into a Forbearance agreement whereas the Company issued Rosen a five-year warrant to purchase 448,000 shares of the Company’s common stock at a purchase price of $0.20 per share. The warrants had a fair value of $65,378 which was recorded to Loss on extinguishment of debt. The new Maturity Date is September 8, 2018.

The November 2017 Schiller Loan Agreement

On November 20, 2017, the Company entered into a loan agreement (the “November 2017 Schiller Loan Agreement”) Schiller, a member of the Board, whereby the Company issued Schiller a promissory note of $25,000 (the “November 2017 Schiller Note”). Pursuant to the November 2017 Schiller Loan Agreement, the November 2017 Schiller Note bears interest at a rate of 15% per annum. During the six months ended June 30, 2018 the Company repaid $25,000 in principal and $637 in interest.

The January 2018 Rosen Loan Agreement

On January 16, 2018, the Company entered into a loan agreement (the “January 2018 Rosen Loan Agreement”) with Rosen, whereby the Company issued Rosen a promissory note of $60,000 (the “January 2018 Rosen Note”). The January 2018 Rosen Note is secured by an officer of the Company whereas upon default an officer of the company owes default shares to the lender equal to the amount of principal outstanding divided by 0.20. Pursuant to the January 2018 Rosen Loan Agreement, the January 2018 Rosen Note bears interest at a rate of 6% per annum and payable on the maturity date of January 31, 2018 (the “January 2018 Rosen Maturity Date”) at which time all outstanding principal, accrued and unpaid interest and other amounts due under the May 2016 Rosen Loan are due. During the six months ended the company has repaid $60,000 in principal and $200 in interest.

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The January 2018 Gordon Loan Agreement

On January 16, 2018, the Company entered into a loan agreement (the “January 2018 Gordon Loan Agreement”) with Gordon, whereby the Company issued Gordon a promissory note of $40,000 (the “January 2018 Gordon Note”). The January 2018 Gordon Note is secured by an officer of the Company whereas upon default an officer of the company owes default shares to the lender equal to the amount of principal outstanding divided by 0.20. Pursuant to the January 2018 Gordon Loan Agreement, the January 2018 Gordon Note bears interest at a rate of 6% per annum and payable on the maturity date of January 31, 2018 (the “January 2018 Gordon Maturity Date”) at which time all outstanding principal, accrued and unpaid interest and other amounts due under the January 2018 Gordon Loan are due. During the six months ended the company have repaid $40,000 in principal and $105 in interest.

The First March 2018 Rosen Loan Agreement

On March 4, 2018, the Company entered into a loan agreement (the “First March 2018 Rosen Loan Agreement”) with Rosen, whereby the Company issued Rosen a promissory note of $10,000 (the “First March 2018 Rosen Note”). As additional consideration for entering in the First March 2018 Rosen Note Loan Agreement, the Company issued Rosen a five-year warrant to purchase 10,000 shares of the Company’s common stock at a purchase price of $0.20 per share. Pursuant to the First March 2018 Rosen Loan Agreement, the First March 2018 Rosen Note bears interest at a rate of 12% per annum and payable on the maturity date of March 19, 2018 (the “First March 2018 Rosen Maturity Date”) at which time all outstanding principal, accrued and unpaid interest and other amounts due under the First March 2018 Rosen Loan was due. During the six months ended the company have repaid $10,000 in principal and $260 in interest.

The Second March 2018 Rosen Loan Agreement

On March 9, 2018, the Company entered into a loan agreement (the “Second March 2018 Rosen Loan Agreement”) with Rosen, whereby the Company issued Rosen a promissory note of $15,000 (the “Second March 2018 Rosen Note”). As additional consideration for entering in the Second March 2018 Rosen Note Loan Agreement, the Company issued Rosen a five-year warrant to purchase 15,000 shares of the Company’s common stock at a purchase price of $0.20 per share. Pursuant to the Second March 2018 Rosen Loan Agreement, the Second March 2018 Rosen Note bears interest at a rate of 12% per annum and payable on the maturity date of March 24, 2018 (the “Second March 2018 Rosen Maturity Date”) at which time all outstanding principal, accrued and unpaid interest and other amounts due under the Second March 2018 Rosen Loan was due. During the six months ended the company have repaid $15,000 in principal and $365 in interest.

The Third March 2018 Rosen Loan Agreement

On March 13, 2018, the Company entered into a loan agreement (the “Third March 2018 Rosen Loan Agreement”) with Rosen, whereby the Company issued Rosen a promissory note of $10,000 (the “Third March 2018 Rosen Note”). As additional consideration for entering in the Third March 2018 Rosen Note Loan Agreement, the Company issued Rosen a five-year warrant to purchase 10,000 shares of the Company’s common stock at a purchase price of $0.20 per share. Pursuant to the Third March 2018 Rosen Loan Agreement, the Third March 2018 Rosen Note bears interest at a rate of 12% per annum and payable on the maturity date of March 28, 2018 (the “Third March 2018 Rosen Maturity Date”) at which time all outstanding principal, accrued and unpaid interest and other amounts due under the Third March 2018 Rosen Loan was due. During the six months ended the company have repaid $10,000 in principal and $230 in interest.

The May 2018 Schiller Loan Agreement

On May 2, 2018, the Company entered into a loan agreement (the “May 2018 Schiller Loan Agreement”) Schiller, a member of the Board, whereby the Company issued Schiller a promissory note of $100,000 (the “May 2018 Schiller Note”). As additional consideration for entering in the May 2018 Schiller Note Loan Agreement, the Company issued Schiller a four-year warrant to purchase 300,000 shares of the Company’s common stock at a purchase price of $0.20 per share. Pursuant to the May 2018 Schiller Loan Agreement, the May 2018 Schiller Note bears interest at a rate of 13% per annum and payable on the maturity date of February 02, 2019 (the “May 2018 Schiller Maturity Date”) at which time all outstanding principal, accrued and unpaid interest are due under the May 2018 Schiller Loan.

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The June 2018 Frommer Loan Agreement

On June 29, 2018, the Company entered into a loan agreement (the “June 2018 Frommer Loan Agreement”) Frommer, an officer of the company, whereby the Company issued Frommer a promissory note of $10,000 (the “June 2018 Frommer Note”). As additional consideration for entering in the June 2018 Frommer Note Loan Agreement, the Company issued Frommer a four-year warrant to purchase 30,000 shares of the Company’s common stock at a purchase price of $0.20 per share. Pursuant to the June 2018 Frommer Loan Agreement, the June 2018 Frommer Note bears interest at a rate of 6% per annum and payable on the maturity date of August 17, 2018 (the “June 2018 Frommer Maturity Date”) at which time all outstanding principal, accrued and unpaid interest are due under the June 2018 Frommer Loan.

Line of credit – related party

On May 9, 2017, the Company entered into a Revolving Line of Credit (the “LOC”) with Grawin, LLC, an LLC controlled by Arthur Rosen, a related party. The LOC was established for a period of twelve months, with a maturity date of May 2018, in which the Company can borrow principal up to $130,000. The LOC bears interest at a rate of 18%.  On June 8, 2018 the Revolving Line of Credit’s maturity date was extended to June 1, 2019.

As of June 30, 2018, the total outstanding balance of line of credit - related party was $130,000.

Note 9 – Capital Leases Payable

Capital lease obligation consisted of the following:

		June 30, 2018			December 31, 2017
(i)	Capital lease obligation to a financing company for a term of five (5) years, collateralized by equipment, with interest at 10.0% per annum, with principal and interest due and payable in monthly installments of $383.10	$	4,732		$	4,732
	Less current maturities		(4,732	)		(4,732	)
	Capital lease obligation, net of current maturities		-			-
	TOTAL CAPITAL LEASE OBLIGATION	$	4,732		$	4,732

The capital leases mature as follows:

2018: $ 4,732 $ 4,732

Note 10 – Stockholders’ Deficit

Shares Authorized

Upon incorporation, the total number of shares of all classes of stock which the Company is authorized to issue is Three Hundred Twenty Million (320,000,000) shares of which Three Hundred Million (300,000,000) shares shall be Common Stock, par value $0.001 per share and Twenty Million (20,000,000) shall be Preferred Stock, par value $0.001 per share. The designations, rights, and preferences of such preferred stock are to be determined by the Board of Directors.

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Preferred Stock

Series A Cumulative Convertible Preferred Stock

On February 13, 2015, 100,000 shares of preferred stock were designated as Series A Cumulative Convertible Preferred Stock (“Series A”). Each share of Series A shall have a stated value equal to $100 (as adjusted for any stock dividends, combinations or splits with respect to such shares) (the “Series A Stated Value”).

The holders of the Series A shall be entitled to receive preferential dividends at the rate of 6% per share per annum on the Series A Stated Value, but before any dividend or other distribution will be paid or declared and set apart for payment on any shares of any Junior Stock, as defined. Such dividends shall compound annually and be fully cumulative, and shall accumulate from the date of original issuance of the Series A and shall be payable quarterly, in arrears, commencing on the first day of the calendar quarter following the date on which the Series A is issued. Upon the occurrence of an Event of Default (as defined below) and while such Event of Default is outstanding, such dividend rate shall be increased to 15% per annum on the Series A Stated Value. At the Company’s option, such dividend payments may be made in (i) cash (ii) additional shares of Series A valued at the Series A Stated Value thereof, in an amount equal to 150% of the cash dividend otherwise payable or (iii) a combination of cash and additional shares of Series A, provided there is not an existing current Event of Default on the date on which a dividend payment is payable, in which event the Holder entitled to receive such dividend may elect to receive such dividends in cash or additional shares of Series A Preferred.

The dividends on the Series A shall be cumulative whether or not declared so that, if at any time full cumulative dividends at the rate aforesaid on all shares of the Series A then outstanding from the date from and after which dividends thereon are cumulative to the end of the annual dividend period next preceding such time shall not have been paid or declared and set apart for payment, or if the full dividend on all such outstanding Series A for the then current dividend period shall not have been paid or declared and set apart for payment, the amount of the deficiency shall be paid or declared and set apart for payment before any sum shall be set apart for or applied by the Corporation or a subsidiary of the Corporation to the purchase, redemption or other acquisition of the Series A or any shares of any other class of stock ranking on a parity with the Series A and before any dividend or other distribution shall be paid or declared and set apart for payment on any Junior Stock and before any sum shall be set aside for or applied to the purchase, redemption or other acquisition of any Junior Stock.

Holder of Series A shall have the right at any time after the issuance, to convert such shares, accrued but unpaid declared dividends on the Series A and any other sum owed by the Corporation arising from the Series A into fully paid and non-assessable shares of Common Stock (the “Conversion Shares”) of the Corporation determined in accordance with the applicable conversion price (the “Conversion Price”). 

The number of Conversion Shares issuable upon conversion shall equal (i) the sum of (A) the Series A Stated Value being converted and/or (B) at the Holder’s election, accrued and unpaid dividends or any other component of the Conversion Amount, divided by (ii) the Conversion Price. The Conversion Price of the Series A shall be $0.25, subject to adjustment.

During the year ended December 31, 2016 the conversion price was adjusted to $0.164

The Corporation and the Holder may not convert that amount of the Conversion Amount on a Conversion Date in amounts that would result in the Holder having a beneficial ownership of Common Stock which would be in excess of the sum of (i) the number of shares of Common Stock beneficially owned by the Holder and its Affiliates on such Conversion Date, and (ii) the number of Conversion Shares issuable upon the conversion of the Conversion Amount with respect to which the determination of this provision is being made on such Conversion Date, which would result in the aggregate beneficial ownership by the Holder and its Affiliates of more than 4.99% of the outstanding shares of Common Stock of the Corporation. For the purposes of the proviso to the immediately preceding sentence, beneficial ownership shall be determined in accordance with Section 13(d) of the 1934 Act and Regulation 13d-3 thereunder. Subject to the foregoing, the Holder shall not be limited to successive exercises which would result in the aggregate issuance of more than 4.99%. The Holder may allocate which of the equity of the Corporation deemed beneficially owned by the Holder shall be included in the 4.99% amount described above and which shall be allocated to the excess above 4.99%. The Holder may waive the conversion limitation described in this Section in whole or in part, upon and effective after sixty-one (61) days’ prior written notice to the Corporation.

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The holders of our Series A do vote together with the holders of our Common Stock on an as converted basis on each matter submitted to a vote of holders of Common Stock. The number of votes that may be cast by a holder of Series A shall be equal to the number of shares of Common Stock issuable upon conversion of such Holder’s Series A on the record date for determining those stockholders entitled to vote on the matter. In addition, the affirmative vote of the holders of a majority of our outstanding Series A is required to for the following actions:

(a) amending the Corporation’s certificate of incorporation or by-laws if such amendment would adversely affect the Series A

(b) purchasing any of the Corporation’s securities other than required redemptions of Series A and repurchase under restricted stock and option agreements authorizing the Corporation’s employees;

(c) effecting a Liquidation Event;

(d) declaring or paying any dividends other than in respect of the Series A; and

(e) issuing any additional securities having rights senior to or on parity with the Series A.

As of June 30, 2018, the company has undeclared Series A dividends of $636,772.

Series B Cumulative Convertible Preferred Stock

On December 21, 2015, 20,000 shares of preferred stock were designated as Series B Cumulative Convertible Preferred Stock (“Series B”). Each share of Series B shall have a stated value equal to $100.00 (as adjusted for any stock dividends, combinations or splits with respect to such shares) (the “Series B Stated Value”).

The holders of outstanding shares of Series B shall be entitled to receive preferential dividends at the rate of 6% per share per annum on the Series B Stated Value, but before any dividend or other distribution will be paid or declared and set apart for payment on any shares of any Junior Stock as defined. Such dividends shall compound annually and be fully cumulative, and shall accumulate from the date of original issuance of the Series B, and shall be payable quarterly, in arrears, commencing on the first day of the calendar quarter following the date on which the Series B is issued. Upon the occurrence of an Event of Default as defined below and while such Event of Default is outstanding, such dividend rate shall be increased to 15% per annum on the Series B Stated Value. At the Corporation’s option, such dividend payments may be made in (i) cash (ii) additional shares of Series B valued at the Series B Stated Value thereof, in an amount equal to 100% of the cash dividend otherwise payable or (iii) a combination of cash and additional shares of Series B, provided there is not an existing current Event of Default on the date on which a dividend payment is payable, in which event the Holder entitled to receive such dividend may elect to receive such dividends in cash or additional shares of Series B Preferred.

The dividends on the Series B shall be cumulative whether or not declared so that, if at any time full cumulative dividends at the rate aforesaid on all shares of the Series B then outstanding from the date from and after which dividends thereon are cumulative to the end of the annual dividend period next preceding such time shall not have been paid or declared and set apart for payment, or if the full dividend on all such outstanding Series B for the then current dividend period shall not have been paid or declared and set apart for payment, the amount of the deficiency shall be paid or declared and set apart for payment before any sum shall be set apart for or applied by the Corporation or a subsidiary of the Corporation to the purchase, redemption or other acquisition of the Series B or any shares of any other class of stock ranking on a parity with the Series B and before any dividend or other distribution shall be paid or declared and set apart for payment on any Junior Stock and before any sum shall be set aside for or applied to the purchase, redemption or other acquisition of any Junior Stock.

Holders of shares of Series B shall have the right at any time commencing after the issuance to convert such shares, accrued but unpaid declared dividends on the Series B into fully paid and non-assessable shares of Common Stock (the “Conversion Shares”) of the Corporation determined in accordance with the applicable conversion price (the “Conversion Price”). All declared or accrued but unpaid dividends may be converted at the election of the Holder together with or independent of the conversion of the Series B Stated Value of the Series B. 

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The number of Conversion Shares issuable upon conversion of the Conversion Amount shall equal (i) the sum of (A) the Series B Stated Value being converted and/or (B) at the Holder’s election, accrued and unpaid dividends or any other component of the Conversion Amount, divided by (ii) the Conversion Price. The Conversion Price of the Series B shall be $0.30, subject to adjustment.

During the year ended December 31, 2016 the conversion price was adjusted to $0.197

The Corporation and the Holder may not convert that amount of the Conversion Amount on a Conversion Date in amounts that would result in the Holder having a beneficial ownership of Common Stock which would be in excess of the sum of (i) the number of shares of Common Stock beneficially owned by the Holder and its Affiliates on such Conversion Date, and (ii) the number of Conversion Shares issuable upon the conversion of the Conversion Amount with respect to which the determination of this proviso is being made on such Conversion Date, which would result in the aggregate beneficial ownership by the Holder and its Affiliates of more than 4.99% of the outstanding shares of Common Stock of the Corporation. For the purposes of the proviso to the immediately preceding sentence, beneficial ownership shall be determined in accordance with Section 13(d) of the 1934 Act and Regulation 13d-3 thereunder. Subject to the foregoing, the Holder shall not be limited to successive exercises which would result in the aggregate issuance of more than 4.99%. The Holder may allocate which of the equity of the Corporation deemed beneficially owned by the Holder shall be included in the 4.99% amount described above and which shall be allocated to the excess above 4.99%. The Holder may waive the conversion limitation described in this Section in whole or in part, upon and effective after sixty one (61) days’ prior written notice to the Corporation.

The holders of our Series B do vote together with the holders of our Common Stock on an as converted basis on each matter submitted to a vote of holders of Common Stock. The number of votes that may be cast by a holder of Series B shall be equal to the number of shares of Common Stock issuable upon conversion of such Holder’s Series B on the record date for determining those stockholders entitled to vote on the matter. In addition, the affirmative vote of the holders of a majority of our outstanding Series B is required to for the following actions:

(a) amending the Corporation’s certificate of incorporation or by-laws if such amendment would adversely affect the Series B

(b) purchasing any of the Corporation’s securities other than required redemptions of Series B and repurchase under restricted stock and option agreements authorizing the Corporation’s employees;

(c) effecting a Liquidation Event;

(d) declaring or paying any dividends other than in respect of the Company’s Series A or Series B; and

(e) issuing any additional securities having rights senior to the Series B. 

As of June 30, 2018, the company has undeclared Series B dividends of $118,289.

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Common Stock

On January 31, 2018, the Company issued 18,750 shares of its restricted common stock to settle outstanding vendor liabilities of $3,750. In connection with this transaction the Company also recorded a gain on settlement of vendor liabilities of $375. 

During the six months ended June 30, 2018, the Company issued 610,000 shares of its restricted common stock to consultants in exchange for services at a fair value of $116,300. These shares were recorded as common stock issued for prepaid services and will be expensed over the life of the consulting contract to share based payments. During the six months ended June 30, 2018 the Company recorded $48,889 to share based payments.

Stock Options

The Company applied fair value accounting for all share-based payments awards. The fair value of each option granted is estimated on the date of grant using the Black-Scholes option-pricing model. 

At June 30, 2018 and 2017, the aggregate intrinsic value of options outstanding and exercisable was $0 and $0, respectively. 

Stock-based compensation for stock options has been recorded in the consolidated statements of operations and totaled $232,129 and $463,619, for the six months ended June 30, 2018 and 2017, respectively.

The Company did not issue any new options during the six months ended June 30, 2018.

Warrants

The Company applied fair value accounting for all share-based payments awards. The fair value of each warrant granted is estimated on the date of grant using the Black-Scholes option-pricing model.

The assumptions used for warrants granted during the six months ended June 30, 2018 are as follows:

	June 30, 2018
Exercise price	$	0.20
Expected dividends		0	%
Expected volatility		92.14%-100.56%
Risk free interest rate		1.64%-2.69%
Expected life of warrant		4 - 5 years

Warrant Activities

The following is a summary of the Company’s warrant activity:

	Warrants			Weighted Average Exercise Price
Outstanding – December 31, 2017		46,193,779		$	0.24
Granted		15,873,016			0.20
Exercised		(50,000	)		0.40
Forfeited/Cancelled		-			-
Outstanding and Exercisable – June 30, 2018		62,016,795		$	0.24

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Warrants Outstanding								Warrants Exercisable
Exercise price		Number Outstanding		Weighted Average Remaining Contractual Life (in years)		Weighted Average Exercise Price		Number Exercisable		Weighted Average Exercise Price
$	0.20		62,016,795		3.66		0.24		62,016,795		0.24

During the six months ended June 30, 2018, a total of 2,425,500 warrants were issued with promissory notes (See Note 6 above). The warrants have a grant date fair value of $420,456 using a Black-Scholes option-pricing model and the above assumptions.

During the six months ended June 30, 2018, a total of 10,481,016 warrants were issued with convertible notes (See Note 7 above). The warrants have a grant date fair value of $1,284,683 using a Black-Scholes option-pricing model and the above assumptions.

During the six months ended June 30, 2018, a total of 1,563,000 warrants were issued with notes payable – related party (See Note 8 above). The warrants have a grant date fair value of $307,808 using a Black-Scholes option-pricing model and the above assumptions.

During the six months ended June 30, 2018, a total of 1,403,500 warrants were issued with convertible notes payable – related party (See Note 8 above). The warrants have a grant date fair value of $162,834 using a Black-Scholes option-pricing model and the above assumptions. 

Note 11 – Commitments and Contingencies

Lease Agreements

On May 5, 2018, the Company signed a 5-year lease for approximately 2,300 square feet of office space at 2050 Center Avenue suite 640, Fort lee, New Jersey 07024. Commencement date of the lease is June 1, 2018. Total amount due under this lease is $411,150.

The annual minimum lease payments under non-cancellable operating leases, that have an initial or remaining term in excess of one year at June 30, 2018 are due as follows:

2018	$	35,972
2019		74,204
2020		78,146
2021		82,207
2022		87,851
2023		37,775
Total minimum lease payments	$	396,155

Rent expense for the three and six months ended June 30, 2018 was $88,875 and $69,022, respectively, and was $155,661 and $77,856, respectively, for the three and six months ended June 30, 2017.

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Note 12 – Revision of Prior Year Financial Statements:

The Company’s correction of accrued dividends were a result of the following:

● Management was accruing dividends as a liability, despite the fact the Board of Directors had not formally declared the dividends payable. This results in accrued dividends being removed from the liabilities section of the balance sheet,

● Management was not compounding the dividends annually,

● Management was not presenting the accrued dividends on the consolidated statement of operations, ultimately being included in the loss per share.

In accordance with the guidance provided by the SEC’s Staff Accounting Bulletin 99, Materiality and Staff Accounting Bulletin No. 108, Considering the Effects of Prior Year Misstatements when Quantifying Misstatements in Current Year Financial Statements the Company has determined that the impact of adjustments relating to the correction of this accounting error are not material to previously issued consolidated financial statements. Accordingly, these changes are disclosed herein and will be disclosed prospectively.

As a result of the aforementioned correction of accounting errors, the relevant financial statements have been revised as follows:

Effects on respective financial statements are as noted below:

	December 31, 2017
	As Previously Reported		Adjustment			As Revised
Balance Sheet
Current Liabilities
Accrued dividends	$	472,444	$	(472,444	)	$	-
Total Current Liabilities		4,159,644		(472,444	)		3,687,200
Total Liabilities	$	8,017,183	$	(472,444	)	$	7,544,739
Stockholders’ Equity
Total Stockholders’ Equity		7,839,751		(472,444	)		7,367,307

	For the six months ended June 30, 2017
	As Previously Reported			Adjustments		As Revised
Statement of Operations
Deemed dividend	$	-		$	131,867	$	131,867
Net loss attributable to common stockholders	$	2,955,909		$	131,867	$	3,087,776
Basic and diluted loss per share	$	(0.08	)	$	-		(0.08	)
Statements of Cash Flows
Supplementary Disclosure of Non-Cash Investing And Financing Activities
Deemed dividend	$	101,385		$	30,482	$	131,867

Note 13 – Subsequent Events

Subsequent to June 30, 2018, the Company received gross proceeds of $100,000 from the issuance of notes payable. As additional consideration for entering in the debentures, the Company issued the investors 4-year warrant to purchase 300,000 shares of the Company’s common stock at a purchase price of $0.20 per share.

Subsequent to June 30, 2018, the Company received gross proceeds from related parties of $25,000 of the issuance of notes payable. As additional consideration for entering in the convertible debentures, the Company issued the investors 4-year warrant to purchase 75,000 shares of the Company’s common stock at a purchase price of $0.20 per share.

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Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations.

This quarterly report on Form 10-Q and other reports filed by Jerrick Media Holdings, Inc. (the “Company”) from time to time with the SEC (collectively, the “Filings”) contain or may contain forward-looking statements and information that are based upon beliefs of, and information currently available to, the Company’s management as well as estimates and assumptions made by Company’s management. Readers are cautioned not to place undue reliance on these forward-looking statements, which are only predictions and speak only as of the date hereof. When used in the Filings, the words “anticipate,” “believe,” “estimate,” “expect,” “future,” “intend,” “plan,” or the negative of these terms and similar expressions as they relate to the Company or the Company’s management identify forward-looking statements. Such statements reflect the current view of the Company with respect to future events and are subject to risks, uncertainties, assumptions, and other factors, including the risks relating to the Company’s business, industry, and the Company’s operations and results of operations. Should one or more of these risks or uncertainties materialize, or should the underlying assumptions prove incorrect, actual results may differ significantly from those anticipated, believed, estimated, expected, intended, or planned.

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

Our financial statements are prepared in accordance with accounting principles generally accepted in the United States (“GAAP”). These accounting principles require us to make certain estimates, judgments and assumptions. We believe that the estimates, judgments and assumptions upon which we rely are reasonable based upon information available to us at the time that these estimates, judgments and assumptions are made. These estimates, judgments and assumptions can affect the reported amounts of assets and liabilities as of the date of the financial statements as well as the reported amounts of revenues and expenses during the periods presented. Our financial statements would be affected to the extent there are material differences between these estimates and actual results. In many cases, the accounting treatment of a particular transaction is specifically dictated by GAAP and does not require management’s judgment in its application. There are also areas in which management’s judgment in selecting any available alternative would not produce a materially different result. The following discussion should be read in conjunction with our financial statements and notes thereto appearing elsewhere in this report.

Overview

We intend for this discussion to provide information that will assist in understanding our financial statements, the changes in certain key items in those financial statements, and the primary factors that accounted for those changes, as well as how certain accounting principles affect our financial statements. This discussion should be read in conjunction with our financial statements and accompanying notes for the six months ended June 30, 2018 and 2017, included elsewhere in this report.

The Company develops technology-based solutions designed to solve for challenges that have resulted from disruption and evolution within the broad digital media and content generation environment. Its flagship product Vocal is a long-form, digital publishing platform focused on supporting content creators with content management tools that are embedded within digital communities. Vocal is architected to enable targeted marketing of branded content and e-commerce opportunities in long-form content. Vocal’s community sites are moderated by a dedicated team with a primary focus on creating healthy communities and identifying monetization opportunities within them.

Vocal serves as a versatile home for content creators. The platform supports multiple forms of content such as: short videos, podcasts, music, and written word. This activity is expected to increase at a rapid pace. A fraction of creators achieve meaningful visibility for their content, and even fewer are rewarded financially. The Company’s product Vocal provides a solution for the creative community.

We partner with content creators and brands that recognize difficulties inherent in the digital advertising space and are looking to capitalize on the branded content marketing opportunities available on publishing platforms like Vocal.

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During the remainder of the second quarter of 2018, Jerrick plans to launch additional revenue lines, including brand subscriptions to access the platform and its community of creators as well as a subscription model for creator upgrade tools. The Company also intends to release further enhancements to the Vocal editor and introduce social features. Further, in the third and fourth quarters of 2018, the Company plans to introduce Software as a Service (SaaS) subscriptions to the Vocal platform. Additional features will include user analytics updates as well as iOS and Android applications.

Results of Operations

Liquidity and Capital Resources

The following table summarizes total current assets, liabilities and working capital at June 30, 2018 compared to December 31, 2017:

	June 30, 2018			December 31, 2017			Increase / (Decrease)
Current Assets	$	117,866		$	112,376		$	5,490
Current Liabilities		4,479,346			3,687,200			792,146
Working Capital Deficit	$	(4,361,480	)	$	(3,574,824	)	$	(786,656	)

At June 30, 2018, we had a working capital deficit of $4,361,480 as compared to a working capital deficit of $3,574,824 at December 31, 2017, an increase of $786,656. The increase is primarily attributable to the increase in prepaid expenses and accounts payable and other accrued expenses.

These were offset by a decrease in cash, convertible notes current, and line of credit.

Net Cash

Net cash used in operating activities for the six months ended June 30, 2018 and 2017, was $2,316,459 and $1,386,370 respectively. The net loss for the six months ended June 30, 2018 and 2017 was $4,504,868 and $2,955,909, respectively. This change is primarily attributable to the net loss for the current period offset by share-based payments in the amount of $285,821 to employees and consultants for services rendered, the accretion of debt discount and debt issuance costs of $589,933 due to the incentives given with debentures, and a loss on extinguishment of debt of $431,786 for the incentives given to amend or convert debt. These increases were offset by gain on settlement of debt of $13,452, gain on settlement of vendor liabilities of $1,875 and a change in prepaid expenses of $18,864 from consulting contracts entered into during the six months ended June 30, 2018.

Net cash used in investing activities for the six months ended June 30, 2018 and 2017 was $16,446 and $0, respectively. This change is attributable to the cash paid for leasehold improvements.

Net cash provided by financing activities for the six months ended June 30, 2018 and 2017 was $2,244,276 and $1,217,153. During the 2018 period, the Company was predominantly financed by issuance of notes and related party notes of $2,183,654 and $544,852, respectively to fund operations. These increases were offset by repayment of notes and related party notes of $162,473 and $160,000, respectively. The Company also paid $166,761 for debt issuance costs during the six months ended June 30, 2018.

Summary of Statements of Operations for the Three Months Ended June 30, 2018 and 2017:

	Three Months Ended
	June 30, 2018			June 30, 2017
Revenue	$	24,023		$	52,259
Operating expenses		(1,589,726	)		(999,878	)
Loss from operations		(1,565,703	)		(947,619	)
Other expenses		(845,535	)		(519,038	)
Net loss	$	(2,411,238	)	$	(1,466,657	)
Loss per common share – basic and diluted	$	(0.06	)	$	(0.04	)

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Revenue

Revenue was $24,023 for the three months ended June 30, 2018, as compared to $52,259 for the comparable three months ended June 30, 2017, a decrease of $28,236. The decrease in revenue is primarily attributable to the Company’s transitioning its ecommerce business from direct sale of products and Company owned memorabilia, through various web-based distribution channels, toward generating revenue through native advertising, branded marketing, and affiliate sales, resulting from the creation of genre specific, user generated content community websites. As part of that transition, the Company focused its efforts throughout 2018 on the development of its proprietary Vocal software platform to support the scalability of its business model. 

Operating Expenses

Operating expenses for the three months ended June 30, 2018 were $1,589,726 as compared to $999,878 for the three months ended June 30, 2017. The increase of $589,848 in operating expenses is the result of a $534,866 increase in General and Administrative expenses related to our relocation to Fort Lee, NJ and the continued development of the Vocal platform, a $313,239 increase in consulting and professional fees related to being a publicly traded company and a $258,257 decrease in compensation.

Loss from Operations

Loss from operations for the three months ended June 30, 2018 was $1,565,703 as compared to loss of $947,619 for the three months ended June 30, 2017. The increase in the loss from operations is primarily attributable to an increase in expenses related to the continued development of the Vocal platform, including the launch of additional content, relocation expenses, and operating as a publicly traded company.

Other Income (Expenses)

Other income (expenses) for the three months ended June 30, 2018 was $(845,535), as compared to $(519,038) for the three months ended June 30, 2017. Other expenses during the three months ended June 30, 2018 was comprised of interest expense of $(341,071) on notes and related party notes, accretion of debt discount and issuance cost of $(415,045) due to the incentives given with debentures and loss on extinguishment of debt of $(89,419) for the incentives given to amend or convert debt. During the six months ended June 30, 2017, other expenses were comprised of interest expense of $(87,318) on notes and related party notes and accretion of debt discount and issuance cost of $(431,720) due to the incentives given with debentures.

Net Loss

Net loss attributable to common shareholder for three months ended June 30, 2018, was $2,411,238, or loss per share of $0.06, as compared to a net loss of $1,466,657, or loss per share of $0.04, for the three months ended June 30, 2017.

Inflation did not have a material impact on the Company’s operations for the applicable period. Other than the foregoing, management knows of no trends, demands, or uncertainties that are reasonably likely to have a material impact on the Company’s results of operations.

Summary of Statements of Operations for the Six Months Ended June 30, 2018 and 2017:

	Six Months Ended
	June 30, 2018			June 30, 2017
Revenue	$	40,272		$	94,101
Operating expenses		(2,929,552	)		(2,069,731	)
Loss from operations		(2,889,280	)		(1,975,630	)
Other expenses		(1,615,588	)		(980,279	)
Net loss	$	(4,504,868	)	$	(2,955,909	)
Loss per common share – basic and diluted	$	(0.11	)	$	(0.08	)

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Revenue

Revenue was $40,272 for the six months ended June 30, 2018, as compared to $94,101 for the comparable six months ended June 30, 2017, a decrease of $53,829. The decrease in revenue is primarily attributable to the Company’s transitioning its ecommerce business from direct sale of products and Company owned memorabilia, through various web-based distribution channels, toward generating revenue through native advertising, branded marketing, and affiliate sales, resulting from the creation of genre specific, user generated content community websites. As part of that transition, the Company focused its efforts throughout 2018 on the development of its proprietary Vocal software platform to support the scalability of its business model.  

Operating Expenses

Operating expenses for the six months ended June 30, 2018 were $2,929,552 as compared to $2,069,731 for the six months ended June 30, 2017. The increase of $859,821 in operating expenses is the result of a $743,367 increase in General and Administrative expenses related to the continued development of the Vocal platform, a $269,033 increase in consulting and professional fees related to being a publicly traded company and a $152,579 decrease in compensation.

Loss from Operations

Loss from operations for the six months ended June 30, 2018 was $2,889,280 as compared to loss of $1,975,630 for the six months ended June 30, 2017. The increase in the loss from operations is primarily attributable to an increase in expenses related to the continued development of the Vocal platform, including the launch of additional content and operating as a publicly traded company and the decrease in sales.

Other Income (Expenses)

Other income (expenses) for the six months ended June 30, 2018 was $(1,615,588), as compared to $(980,279) for the six months ended June 30, 2017. Other expenses during the six months ended June 30, 2018 was comprised of interest expense of $(609,196) on notes and related party notes, accretion of debt discount and issuance cost of $(589,933) due to the incentives given with debentures and loss on extinguishment of debt of $(431,786) for the incentives given to amend or convert debt. These expenses were offset by the gain on settlement of debt of $13,452 as recorded during the six months ended June 30, 2018. During the six months ended June 30, 2017, other expenses were comprised of interest expense of $(144,705) on notes and related party notes, accretion of debt discount and issuance cost of $(724,900) due to the incentives given with debentures and loss on settlement of vendor liabilities of $(110,674).

Net Loss

Net loss attributable to common shareholder for six months ended June 30, 2018, was $4,504,868, or loss per share of $0.11, as compared to a net loss of $2,955,909, or loss per share of $0.08, for the six months ended June 30, 2017.

Inflation did not have a material impact on the Company’s operations for the applicable period. Other than the foregoing, management knows of no trends, demands, or uncertainties that are reasonably likely to have a material impact on the Company’s results of operations.

Off-Balance Sheet Arrangements 

As of June 30, 2018, we have no off-balance sheet arrangements. 

Critical Accounting Policies

We believe that the following accounting policies are the most critical to aid you in fully understanding and evaluating this “Management’s Discussion and Analysis of Financial Condition and Results of Operation.”

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Use of Estimates

We use estimates and assumptions in preparing financial statements. Those estimates and assumptions affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities, and the reported revenues and expenses. Actual results could differ from those estimates.

Fair Value Measurements

The fair value of a financial instrument is the amount that could be received upon the sale of an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. Financial assets are marked to bid prices and financial liabilities are marked to offer prices. Fair value measurements do not include transaction costs. A fair value hierarchy is used to prioritize the quality and reliability of the information used to determine fair values. Categorization within the fair value hierarchy is based on the lowest level of input that is significant to the fair value measurement. The fair value hierarchy is defined into the following three categories: 

Level 1 – Quoted prices in active markets for identical assets or liabilities;

Level 2 – Inputs other than quoted prices included within Level 1 that are either directly or indirectly observable; and

Level 3 – Unobservable inputs that are supported by little or no market activity, therefore requiring an entity to develop its own assumptions about the assumptions that market participants would use in pricing.

The Company recognizes income and expenses based on the accrual method of accounting.

Income Taxes

The Company utilizes the liability method of accounting for income taxes. Under the liability method deferred tax assets and liabilities are determined based on the differences between financial reporting and the tax bases of the assets and liabilities and are measured using the enacted tax rates and laws that will be in effect, when the differences are expected to reverse. An allowance against deferred tax assets is recorded when it is more likely than not that such tax benefits will not be realized.

Derivative Liability

The Company evaluates its debt and equity issuances to determine if those contracts or embedded components of those contracts qualify as derivatives to be separately accounted for in accordance with paragraph 815-10-05-4 and Section 815-40-25 of the FASB Accounting Standards Codification. The result of this accounting treatment is that the fair value of the embedded derivative is marked-to-market each balance sheet date and recorded as either an asset or a liability. In the event that the fair value is recorded as a liability, the change in fair value is recorded in the consolidated statement of operations as other income or expense. Upon conversion, exercise or cancellation of a derivative instrument, the instrument is marked to fair value at the date of conversion, exercise or cancellation and then the related fair value is reclassified to equity.

In circumstances where the embedded conversion option in a convertible instrument is required to be bifurcated and there are also other embedded derivative instruments in the convertible instrument that are required to be bifurcated, the bifurcated derivative instruments are accounted for as a single, compound derivative instrument.

The classification of derivative instruments, including whether such instruments should be recorded as liabilities or as equity, is re-assessed at the end of each reporting period. Equity instruments that are initially classified as equity that become subject to reclassification are reclassified to liability at the fair value of the instrument on the reclassification date. Derivative instrument liabilities will be classified in the balance sheet as current or non-current based on whether or not net-cash settlement of the derivative instrument is expected within 12 months of the balance sheet date.

The Company adopted Section 815-40-15 of the FASB Accounting Standards Codification (“Section 815-40-15”) to determine whether an instrument (or an embedded feature) is indexed to the Company’s own stock.  Section 815-40-15 provides that an entity should use a two-step approach to evaluate whether an equity-linked financial instrument (or embedded feature) is indexed to its own stock, including evaluating the instrument’s contingent exercise and settlement provisions.  

36

The Company utilizes an option pricing model to compute the fair value of the derivative and to mark to market the fair value of the derivative at each balance sheet date. The Company records the change in the fair value of the derivative as other income or expense in the consolidated statements of operations.

Adoption of ASU 2017-11

As noted above, in connection with the securities purchase agreement and debt transactions during the year ended December 31, 2017, the Company issued warrants and convertible notes, to purchase common stock with an exercise price of $0.20 and a five-year term. Upon issuance of the warrants and convertible notes, the Company evaluated the note agreement to determine if the agreement contained any embedded components that would qualify the agreement as a derivative. The Company identified certain put features embedded in the warrants and convertible notes that potentially could result in a net cash settlement in the event of a fundamental transaction, requiring the Company to classify the warrants and convertible notes as a derivative liability. The Company changed its method of accounting for the convertible notes and warrants through the early adoption of ASU 2017-11 during the three months ended December 31, 2017 on a retrospective basis. Accordingly, the Company recorded the warrant derivative and conversion option derivative liabilities to additional paid in capital upon issuance.

Stock Based Compensation

All stock-based payments to employees, non-employee consultants, and to nonemployee directors for their services as directors, including any grants of restricted stock and stock options, are measured at fair value on the grant date and recognized in the statements of operations as compensation or other expense over the relevant service period. Stock-based payments to nonemployees are recognized as an expense over the period of performance. Such payments are measured at fair value at the earlier of the date a performance commitment is reached or the date performance is completed. In addition, for awards that vest immediately and are non-forfeitable the measurement date is the date the award is issued.

Recent Accounting Pronouncements

The Company does not expect that the adoption of recent accounting pronouncements will have a material impact on its financial statements.

Item 3. Quantitative and Qualitative Disclosures About Market Risk.

We do not hold any derivative instruments and do not engage in any hedging activities.

Item 4. Controls and Procedures.

(a) Evaluation of Disclosure Controls and Procedures.

In connection with the preparation of this Quarterly Report on Form 10-Q for the quarter ended June 30, 2018, our principal executive officer and principal financial officer have concluded that our disclosure controls and procedures (as defined in Rules 13a-15(c) and 15d-15(e) under the Exchange Act) are not effective to ensure that information required to be disclosed by us in report that we file or submit under the Exchange Act is recorded, processed, summarized and reported within the time periods specified in the U.S. Securities and Exchange Commission’s rules and forms and to ensure that information required to be disclosed by us in the reports that we file or submit under the Exchange Act is accumulated and communicated to our management, including our Chief Executive Officer, as appropriate to allow timely decisions regarding required disclosure.

(b) Changes in Internal Control over Financial Reporting.

There were no changes in our internal control over financial reporting, as defined in Rules 13a-15(f) and 15d-15(f) under the Exchange Act, during our most recently completed fiscal quarter that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting. 

37

PART II - OTHER INFORMATION

Item 1. Legal Proceedings.

We are currently not involved in any litigation  that we believe could have a material adverse effect on our financial condition or results of operations. There is no action, suit, proceeding, inquiry or investigation before or by any court, public board, government agency, self-regulatory organization or body pending or, to the knowledge of the executive officers of our Company or any of our subsidiaries, threatened against or affecting our company, our common stock, any of our subsidiaries or of our companies or our subsidiaries’ officers or directors in their capacities as such, in which an adverse decision could have a material adverse effect.

Item 1A. Risk Factors.

We believe there are no changes that constitute material changes from the risk factors previously disclosed in our Annual Report on Form 10-K, filed with the SEC on May 17, 2018. 

Item 2. Unregistered Sales of Equity Securities and Use of Proceeds.

With the exception of the below, there have been no unregistered sales of equity securities that have not been previously disclosed in a Current Report on Form 8-K filed with the Securities and Exchange Commission. On June 29, 2018, the Company entered into a loan agreement (the “June 2018 Frommer Loan Agreement”) Frommer, an officer of the company, whereby the Company issued Frommer a promissory note of $10,000 (the “June 2018 Frommer Note”). As additional consideration for entering in the June 2018 Frommer Note Loan Agreement, the Company issued Frommer a four-year warrant to purchase 30,000 shares of the Company’s common stock at a purchase price of $0.20 per share . Pursuant to the June 2018 Frommer Loan Agreement, the June 2018 Frommer Note bears interest at a rate of 6% per annum and payable on the maturity date of August 17, 2018 (the “June 2018 Frommer Maturity Date”) at which time all outstanding principal, accrued and unpaid interest are due under the June 2018 Frommer Loan.

Item 3. Defaults Upon Senior Securities.

There has been no default in the payment of principal, interest, sinking or purchase fund installment, or any other material default, with respect to any indebtedness of the Company.

Item 4. Mine Safety Disclosures.

Not applicable.

Item 5. Other Information.

On May 5, 2018, the Company signed a 5-year lease for approximately 2,300 square feet of office space at 2050 Center Ave, Suite 640, Fort Lee NJ 07024. The commencement date of the lease is June 1, 2018. Monthly rent of $5,612 for the first year and increases at a rate of 3% for each subsequent year thereafter

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Item 6. Exhibits.

Exhibit No.	Description
4.1	Form of Warrant (incorporated by reference to Exhibit 4.1 to the Company’s current report on Form 8-K filed with the Commission on April 2, 2018)
4.2	Form of Warrant (incorporated by reference to Exhibit 4.1 to the Company’s current report on Form 8-K filed with the Commission on May 29, 2018)
10.1	Form of Purchase Agreement (incorporated by reference to Exhibit 10.1 to the Company’s current report on Form 8-K filed with the Commission on April 2, 2018)
10.2	Form of Promissory Note (incorporated by reference to Exhibit 10.2 to the Company’s current report on Form 8-K filed with the Commission on April 2, 2018)
10.3	Form of Securities Purchase Agreement (incorporated by reference to Exhibit 10.1 to the Company’s current report on Form 8-K filed with the Commission on May 29, 2018)
10.4	Form of Promissory Note (incorporated by reference to Exhibit 10.2 to the Company’s current report on Form 8-K filed with the Commission on May 29, 2018)
10.5*	Lease Agreement
31.1*	Certification by the Principal Executive Officer of Registrant pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 (Rule 13a-14(a) or Rule 15d-14(a)).
31.2*	Certification by the Principal Financial Officer of Registrant pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 (Rule 13a-14(a) or Rule 15d-14(a)).
32.1*	Certification by the Principal Executive Officer pursuant to 18 U.S.C. 1350 as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
32.2*	Certification by the Principal Financial Officer pursuant to 18 U.S.C. 1350 as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
101.INS*	XBRL Instance Document
101.SCH*	XBRL Taxonomy Extension Schema Document
101.CAL*	XBRL Taxonomy Extension Calculation Linkbase Document
101.DEF*	XBRL Taxonomy Extension Definition Linkbase Document
101.LAB*	XBRL Taxonomy Extension Label Linkbase Document
101.PRE*	XBRL Taxonomy Extension Presentation Linkbase Document

* Filed herewith

39

SIGNATURES

Pursuant to the requirements of the Exchange Act, the registrant caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

	JERRICK MEDIA HOLDINGS, INC.
Date: August 20, 2018	By:	/s/ Jeremy Frommer
	Name:	Jeremy Frommer
	Title:	Chief Executive Officer
		(Principal Executive Officer)
		(Principal Financial Officer)
		(Principal Accounting Officer)

40

EX-10.5

Exhibit 10.5

LEASE AGREEMENT

Between

H&M Group Inc.,

as Landlord,

-and-

JERRICK MEDIA

as Tenant.

Polygon Plaza

2050 Center Avenue

Fort Lee, New Jersey

Basic Lease Provisions.		3
1.	Demised Premises	5
2.	Term	5
3.	Rent	6
4.	Use and Occupancy	6
5.	Alterations or Improvements by Tenant	7
6.	Maintenance	7
7.	Compliance with Laws and Insurance	8
8.	Subordination and Estoppel	8
9.	Destruction - Fire or Other Casualty	8
10.	Mutual Waiver of Subrogation	9
11.	Condemnation and Other Proceedings	9
12.	Assignment and Subletting	10
13.	Surrender	11
14.	Holding Over	11
15.	Landlord’s Right to Entry	11
16.	Default	12
17.	Landlord’s Rights Upon Tenant’s Default	12
18.	Landlord’s Remedies Cumulative; Expenses	13
19.	No Waiver	14
20.	Landlord’s Reserved Rights	14
21.	Landlord’s Liability	14
22.	Tenant’s Liability	15
23.	Tenant’s Insurance	15
24.	Quiet Enjoyment	16
25.	Landlord’s Services	16
26.	Additional Rent	18
27.	Personal Property Taxes	20
28.	Security Deposit	20
29.	Use of Security Deposit	20
30.	Definition of Landlord	20
31.	Notices	21
32.	Signs	21
33.	Notice of Defects and Accidents	21
34.	Rules and Regulations	21
35.	Directory	21
36.	Environmental Matters	21
37.	Miscellaneous	22
EXHIBIT A
EXHIBIT B
EXHIBIT C

Page 2

LEASE AGREEMENT (the “Lease”) dated as of the 2 day of April, 2018, between H&M Group Inc. (hereinafter referred to as “Landlord”), and JERRICK MEDIA (hereinafter referred to as “Tenant”).

WITNESSETH:

Landlord and Tenant hereby covenant and agree as follows:

Basic Lease Provisions.

The following basic terms of the Lease (hereinafter referred to as the “Basic Lease Provisions”) between Landlord and Tenant are an integral part of and are incorporated by reference into the within Lease:

A. The “Building”:	2050 Center Avenue, Fort Lee, New Jersey 07024 (currently known as “Polygon Plaza”) situated on a tract of land containing approximately .79 acres. The foregoing land and Building are sometimes referred to herein as the “Real Property”.
B. The “Premises”:	(1) As shown on Exhibit A attached to the Lease, and referred to as follows: Suite Number 640, 6th floor.
	(2) Rentable square footage: 2,300 sqft.
C. The “Term”:	The Term of this Lease shall be 5 years and 2 month, beginning on the later of May 1, 2018 and Landlord’s substantial completion of Landlord’s Work (the “Commencement Date”) and ending on a date 5 years and 1 month after the Commencement Date (the “Expiration Date”).

D. The “Basic Rent” and electricity charge:	“Basic Rent”: Lease Year		Annual Amount		Monthly Amount
-   3% Annual Rent Increases		1	$	67,344.00	$	5,612.00
-   Amortized cost of Tenant		2	$	69,184.00	$	5,765.33
Improvements distributed for		3	$	71,070.00	$	5,922.50
5 year term.		4	$	73,002.00	$	6,083.50
		5	$	75,003.00	$	6,250.25
		Electricity Charge:	$	4,600.00	$	383.33

E. Renewal Option:	Tenant shall have one, (1) five (5) year option to renew at fair market value, with twelve (12) months prior written notice to Landlord.
F. Rent Concession	Two(2) months: May and June 2018. Tenant shall pay Tenant Electric during the Rent Concession Period.
G. The “Tenant’s Proportionate Share”:	3.10%
H. The “Security Deposit”:	$16,836.00 1/3 of which Landlord agrees to return to Tenant at the end of the first Lease Year provided the Tenant has not defaulted hereunder beyond applicable grace periods.
I. Broker(s):	Joseph Tormen, Lee & Associates and Harrison Russell, Newmark Knight Frank
J. Addresses for Notices and for payments:	(1) Landlord: H&M GROUP INC.
	Suite 670
	2050 Center Avenue
	Fort Lee, New Jersey 07024

Page 3

(2) Tenant:

JERRICK MEDIA

(3) Make checks payable to:

H&M GROUP INC.

Mail payments to:

H&M GROUP INC.

Suite 670

2050 Center Avenue

Fort Lee, New Jersey 07024

K. The “Base Tax Year”:	2018
L. The “Base Operating Year”:	2018
M. Tenant’s Required Insurance:	a. Workmen’s Compensation: statutory.
	b. Employer’s Liability: Not less than $100,000
	c. Broad Form Comprehensive: Not less than $1,000,000 General Liability insurance, combined single limit for both bodily injury and liability, including contractual, Broad Form Property Damage, Personal Injury, Completed Operations, Products Liability, Fire Damage.
N. The “Permitted Use”:	Executive and administrative office use only.
O. Number of non-exclusive permitted parking spaces:	6

Page 4

1. Demised Premises.

1.1. Landlord hereby leases to Tenant, and Tenant hereby leases from Landlord for the Term and upon the terms, conditions, covenants and agreements hereinafter provided, the Premises. The Premises consists of space which is bounded by the proposed or existing demising walls therefor, the approximate locations of such demising walls and space being marked in color or crosshatched and shown on the diagram(s) of the floor plan for each relevant floor, such diagram being attached to this Lease as Exhibit A and made a part hereof. The Premises is to be known and called by the Suite Number or Numbers specified in Item B of the Basic Lease Provisions. The number of rentable square feet of which the Premises shall be deemed to consist, as hereby agreed to by the parties, is specified in Item B of the Basic Lease Provisions (the “Rentable Area”). The lease of the Premises includes the right, together with the Landlord, other tenants of the Building, and their respective assignees, subtenants, principals, employees, agents, contractors, guests, invitees and others claiming by, through, or under that person or entity (collectively, “Occupants”), and members of the public, to use the common public areas of the Building for their intended purposes, but includes no other rights not specifically set forth herein.

1.2. Landlord shall finish the Premises as set forth in Exhibit B attached hereto and made a part hereof. It is understood and agreed that Landlord will not make and is under no obligation to make, any alterations, decorations, additions or improvements in or to the Building or Premises, structural or otherwise, except as set forth in Exhibit B. Landlord agrees to deliver possession of the Premises to Tenant and Tenant agrees to accept the same from Landlord upon written notice from Landlord to Tenant that Landlord’s work in the Premises as described in Exhibit B has been substantially completed. Landlord has made no representation or promises with respect to the Premises or the Real Property except as expressly contained herein. Tenant has inspected the Premises and agrees to take the same in a strictly “AS IS” condition, except as otherwise expressly set forth in Exhibit B.

1.3. For purposes of this Lease “substantial completion” or “substantially complete” shall mean that the work which Landlord is expressly obligated to perform pursuant to Exhibit B shall have reached that stage of completion such that Tenant could reasonably use and occupy the Premises without substantial interference by reason of the work required to complete those items still remaining to be completed.

2. Term.

2.1. The Premises are leased for the period of years and months as specified in Item C of the Basic Lease Provisions to commence at 12:01 A.M. on the Commencement Date and to end at 11:59 P.M. on the Expiration Date unless the Term shall sooner terminate pursuant to any of the terms, covenants or conditions of this Lease or pursuant to law. “Lease Year”, if the Commencement date is the first day of a calendar month, shall mean a period of twelve calendar months commencing on the Commencement Date and each consecutive 12-month period thereafter, all or any part of which period occurs during the Term.

2.2. Notwithstanding anything in Paragraph 2.1 to the contrary, if, on the Commencement Date, the Premises are not substantially complete or if Landlord otherwise cannot deliver the Premises by the Commencement Date to Tenant, this Lease shall nevertheless continue in full force and effect and Tenant shall have no right to rescind, cancel or terminate this Lease nor shall Landlord be liable for damages, if any, sustained by Tenant by reason of inability to obtain possession thereof on such date. In such event, Landlord shall give to Tenant notice at least five business days in advance of the date when Landlord expects to deliver possession of the Premises with Landlord’s work substantially complete, which date shall then become the Commencement Date, in which case the Expiration Date shall be deemed modified to reflect the full lease term originally contemplated hereby pursuant to he Basic Lease Provisions.

2.3. At any time after the occurrence of the Commencement Date, either party, at the request of the other, shall deliver to the requesting party a certification specifying the dates which are the Commencement Date and the Expiration Date.

2.4. When Tenant takes possession of the Premises, Tenant shall be deemed to have acknowledged that Landlord has properly completed the work described on Exhibit B and to have accepted the Premises as being satisfactory and in good condition as of the date of such possession,. subject, however, to any punch list items as to which Tenant shall notify Landlord within the first 30 days of the Term which punch list items Landlord shall address as promptly as reasonably practicable.

Page 5

3. Rent.

3.1. Tenant covenants and agrees to pay to Landlord as rent for and during the Term hereof the annual sum as specified in Item D of the Basic Lease Provisions as Basic Rent, as well as any and all other sums payable by Tenant hereunder (“Additional Rent”).

3.2. Basic Rent and any Additional Rent payable pursuant to the provisions of this Lease shall be payable by Tenant to Landlord at the address specified in Item J of the Basic Lease Provisions (or at such other place as Landlord may designate in a notice to Tenant) in lawful money of the United States without prior demand therefor and without any offset or deduction whatsoever. Basic Rent shall be payable in equal monthly installments as specified in Item D of the Basic Lease Provisions, in advance, on the first (1st) day of each calendar month during the Term. The installment of Basic Rent for the first (1st) full calendar month of the Term is due and payable by Tenant to Landlord at the time of the execution and delivery of this Lease.

4. Use and Occupancy.

4.1. Tenant shall use and occupy the Premises solely for the Permitted Use described in Item N of the Basic Lease Provisions, and only in accordance with the uses permitted under applicable zoning and other municipal regulations, and for no other purpose. The Premises shall not be used for any purpose or in any manner which is likely to constitute an unreasonable annoyance to Landlord or other tenants of the Building. Tenant’s use of the Premises shall at all times comply with all present and future laws, ordinances, regulations, and orders of the United States of America, the jurisdiction(s) in which the Building is located and any other public or quasi-public authority having jurisdiction over the Premises.

4.2. Tenant agrees that it will not permit the smoking of tobacco products within the Building.

4.3. Tenant shall have the right to the non-exclusive use of the number of parking spaces specified in Item O of the Basic Lease Provisions in the parking facilities on the Real Property for its Occupants. Such right does not entitle Tenant to any particular assigned spaces in the parking facilities, but nothing contained herein shall prohibit Landlord from assigning specific parking spaces to one or more Occupants. Tenant covenants and agrees to comply with all reasonable rules and regulations which Landlord may hereafter from time to time make to assure exclusive use of designated parking spaces on the Real Property by permitted users. Landlord’s remedies under such rules and regulations may include, but shall not be limited to, the right to tow away at owner’s expense any vehicles not parked in compliance with such rules and regulations. Landlord shall not be responsible to Tenant for the noncompliance or breach by any other tenant of said rules and regulations; provided, however, Landlord agrees to use reasonable efforts to enforce such rules and regulations uniformly.

4.4. Tenant’s and its Occupants’ right to use, and its right to permit its principals and guests to use, the Building’s parking facilities pursuant to this Lease are subject to the following conditions: (i) Landlord has made no representations or warranties with respect to the parking facilities except as specifically provided herein; (ii) Landlord reserves the right to reduce the number of spaces in the parking facilities area and/or change access thereto so long as such reduction or change does not materially alter the number of spaces or ease of access thereto; (iii) Landlord has no obligation to provide a parking garage attendant; (iv) if and when so requested by Landlord, Tenant shall furnish Landlord with the license numbers of any vehicles of Tenant, or its Occupants, agents and employees; and (v) Landlord shall not be liable to Tenant or to any of its Occupants, agents, employees or invitees of Tenant for injuries to person or loss or damage to property, and Landlord shall have no liability on account of any loss or damage to any vehicle or the contents thereof, Tenant hereby agreeing to bear the risk of loss for same, including, without limitation, as a result of fire, theft, vandalism or collision, in connection with the use of the parking facilities area.

Page 6

5. Alterations or Improvements by Tenant.

5.1. Tenant shall make no alterations, changes, decorations, installations, additions or improvements (collectively hereinafter referred to as “Alterations”) in or to the Premises of any nature without Landlord’s prior written consent. Subject to the prior written consent of Landlord, Tenant, at Tenant’s sole cost and expense, may hire contractors approved by Landlord to make Alterations which are nonstructural and which do not affect the plumbing, electrical, heating, air-conditioning, or mechanical systems (collectively, “Building Systems”) in or to the Premises or the Building; provided, however, all such work shall be performed in compliance with Landlord’s rules and regulations with respect to Alterations. The Alterations shall, upon installation, become the property of Landlord. Nothing in this Paragraph 5 shall be construed to give Landlord title to or to prevent Tenant’s removal of trade fixtures or moveable office furniture and equipment, but upon removal of any such items from the Premises or upon removal of any other installation as may be permitted by Landlord, Tenant shall immediately and at its sole cost and expense, repair and restore the Real Property to the condition existing prior to such removal. All property permitted or required to be removed by Tenant at the Expiration Date or sooner termination of the Term which remains on the Premises after the Expiration Date or sooner termination of the Term shall be deemed abandoned and may, at the election of Landlord, either be retained as Landlord’s property or may be removed from the Premises by Landlord at Tenant’s expense. At Landlord’s option, Landlord may, at the expiration of the Term, require Tenant, at Tenant’s sole cost and expense, to remove Alterations made by or on behalf of Tenant and to repair and restore the Premises to the condition existing prior to the making of such Alterations.

5.2. Prior to the commencement of any Alterations, Tenant shall, at its sole cost and expense, obtain all required permits, approvals and certificates required by all governmental authorities having jurisdiction thereover and shall furnish Landlord with evidence of same, and, upon completion of the Alterations, shall furnish Landlord with certificates of final approval thereof. Tenant shall carry and will cause Tenant’s contractors and subcontractors to carry such worker’s insurance as is required by law and as may be required by Landlord.

5.3. As a condition precedent to the consent of Landlord to any Alteration, Tenant agrees to obtain and deliver to Landlord guarantees and/or other security reasonably required by Landlord for the cost of all work, labor and services to be performed and materials to be furnished in connection with such work. If, notwithstanding the foregoing, any mechanic’s or materialmen’s lien is filed against the Real Property for work claimed to have been done for, or materials claimed to have been furnished to, Tenant, such lien shall be discharged by Tenant within thirty (30) days thereafter, at Tenant’s sole cost and expense, by the payment thereof or by filing a bond. If Tenant shall fail to timely discharge any such mechanic’s or materialmen’s lien, Landlord may, at its option, discharge the same and treat the cost thereof as Additional Rent payable by Tenant to Landlord upon demand; it being hereby expressly covenanted and agreed that such discharge by Landlord shall not be deemed to cure, waive or release the Default of Tenant in not discharging the same, such that Landlord shall not be estopped from exercising any of its other remedies due to the occurrence of such Default. It is expressly understood and agreed by Landlord and Tenant that any Alterations shall be deemed constructed on behalf of Tenant and not Landlord, and that, if Landlord gives its written consent to Tenant’s making any such Alterations, such written consent is not and shall not be deemed to be an agreement or consent by Landlord to subject Landlord’s interest in the Premises, the Building or the Real Property to any mechanic’s or mate-rialmen’s liens which may be filed in respect to any Alterations made by or on behalf of Tenant, Landlord hereby advising Tenant that it does not consent to any lien being filed against Landlord’s interest in the Premises, the Building or the Real Property.

5.4. Should Tenant make any Alteration in violation of the terms hereof Landlord shall have the right to enter the Premises and remove such unauthorized Alteration and Tenant shall be liable for any and all expenses incurred by Landlord in said removal and subsequent restoration of the Real Property to the condition existing prior to the making of such Alteration.

6. Maintenance.

6.1. Tenant shall take good care of the Premises throughout the Term, including, without limitation, the plumbing, electrical and mechanical systems servicing the Premises, and preserve same in the condition delivered to Tenant on the Commencement Date, normal wear and tear, casualty and condemnation excepted. Tenant shall not injure, overload, deface or commit waste of the Premises. Tenant shall be responsible for all injury or damage of any kind or character to the Real Property, including, without limitation, the windows, floors, walls, ceilings, lights, electrical equipment and HVAC equipment, caused by Tenant or its Occupants. Landlord shall repair the same and Tenant shall pay the costs incurred therefor to Landlord immediately upon demand plus a ten percent (10%) management fee.

6.2. Except as set forth in Paragraph 6.1, Landlord shall be responsible for all repairs to the roof, foundation and permanent exterior walls and support columns of the Building, and shall maintain and repair all Building Systems, the parking facilities, and the exterior of the Building.

Page 7

7. Compliance with Laws and Insurance.

7.1. Tenant, at its sole cost and expense, will promptly comply with all applicable laws, guidelines, rules, regulations and requirements, whether of federal, state or local origin, applicable to the Tenant or the Premises. Tenant shall not do, or permit anything to be done, in or to or about the Premises, or bring or keep anything therein which will, in any way: (i) increase the cost of fire or public liability insurance on the Real Property; or (ii) invalidate or conflict with the fire insurance or public liability insurance policies covering the Real Property, the Building, the Building fixtures or any personal property kept therein; or (iii) obstruct or interfere with the rights of Landlord or of other tenants; or (iii) injure or annoy Landlord or other tenants; or (iv) subject Landlord to any liability for injury to persons or damage to property; or (v) conflict with the present or future laws, rules or regulations of any governmental authority. Tenant agrees that it will bear the cost of purchasing, installing and inspecting the fire extinguisher, if any, which is required by the Fort Lee Fire Department or any other proper authority to be maintained in the Premises.

8. Subordination and Estoppel.

8.1. Tenant agrees that this Lease is subject and subordinate to all ground or underlying leases and to the lien of any mortgages or deeds of trust which are now or may hereafter be made a lien upon the Real Property, and to all advances made or hereafter to be made upon the security thereof and to all recastings, renewals, modifications, consolidations, replacements and extensions of any such lease(s), mortgage(s) or deed(s) of trust, and to all increases and voluntary and involuntary advances made thereunder. This subordination provision shall be self-operative and no further instrument of subordination shall be required, provided, however, that without in any way modifying the self-operative nature of this Paragraph, Tenant, within five (5) business days of Landlord’s request, shall execute and deliver such further instrument or instruments confirming this subordination as shall be desired by Landlord or by any mortgagee or proposed mortgagee of the Real Property. Tenant covenants and agrees to attorn to, recognize and be bound to, as its new Landlord, any purchaser at any foreclosure sale or any party which acquires title to the Building pursuant to the exercise of any remedy provided for in any mortgage or by reason of the acceptance of a deed in lieu of foreclosure, and this Lease shall continue in full force and effect as a direct Lease between Tenant and said party. Tenant agrees to execute such further evidence of attornment to any such party as such party shall reasonably require. Tenant agrees that in no event shall any mortgagee or any such person, whether in the capacity of holder of a mortgage secured by the Real Property or in the capacity of successor landlord by virtue of the exercise of any remedy provided for in its mortgage or by reason of the acceptance of a deed in lieu of foreclosure, be liable to Tenant for any act or omission of Landlord which occurred prior to the date that such mortgagee or party acquires title to the Real Property.

8.2. Tenant agrees at any time and from time to time, upon not less than five (5) days’ prior written request by Landlord, to execute, acknowledge and deliver to Landlord a true and accurate statement in writing certifying: (i) that this Lease is unmodified and in full force and effect (or, if there have been modifications, that the same are in full force and effect as modified and stating the modifications); (ii) that there are no offsets, defenses, defaults, or counterclaims under this Lease or against Landlord (or, if so, what the same are); (iii) the dates to which the Basic Rent and Additional Rent have been paid; (iv) the Commencement Date and Expiration Date; (v) that Landlord has completed all of the work for which it is responsible pursuant to Exhibit B; and (vi) such other information as Landlord or its designee may request; it being intended that any such statement delivered pursuant to this Paragraph 8.2 may be relied upon by a prospective purchaser of Landlord’s interest or mortgagee of Landlord’s interest or assignee of any mortgage upon Landlord’s interest in the Real Property, and that such statement shall, in all respects, conclusively bind Tenant with respect to the matters set forth therein.

9. Destruction - Fire or Other Casualty.

9.1. If the Premises or the Building shall be damaged by fire or other casualty, then, except as otherwise provided in Paragraph 9.2 hereof, the damage shall be repaired by and at the expense of Landlord and, until such repairs shall be made, the Basic Rent and Additional Rent shall be equitably abated according to the part of the Premises which is usable by Tenant. Landlord, subject to Paragraph 37.3 hereof, agrees to make such repairs in a prompt and expeditious manner following the receipt by Landlord of insurance proceeds payable to Landlord by virtue of such fire or other casualty. Landlord shall have no obligation to repair or replace Tenant’s Alterations or furniture, furnishings and equipment, and Tenant shall repair or replace the same at Tenant’s sole cost and expense. Landlord will not be liable for any damage to or any inconvenience or interruption of the business of Tenant or any of Tenant’s agents, invitees or Occupants occasioned by fire or other casualty.

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9.2. If the Building is substantially destroyed or is rendered wholly untenantable by fire or other casualty, or if the Building or the Premises cannot reasonably be repaired within ninety (90) days of the fire or other casualty, or if Landlord shall decide to demolish the Building or not to rebuild the Building or the Premises, or if the then governing zoning regulations do not allow for the restoration of the Building, or if any mortgagee does not make insurance proceeds available to Landlord, then Landlord may decide to not repair the damage caused by the casualty. Landlord shall, within ninety (90) days after such fire or other casualty, give Tenant a notice of such decision, and thereupon the Term shall expire five (5) days after such notice is given, in which case Tenant shall vacate the Premises and surrender the same as if such termination date were the originally specified Expiration Date.

10. Mutual Waiver of Subrogation.

10.1. Landlord hereby waives any and all rights of recovery against Tenant for or arising out of damage to or destruction of the Premises, the Building, or the Real Property and any other property of Landlord from causes then insured under standard fire and extended coverage insurance policies or endorsements to the extent that its insurance policies in effect at the time of any such damage or destruction permit such waiver, and Tenant hereby waives any and all rights of recovery against Landlord for or arising out of damage to or destruction of the Premises, the Building or the Real Property and any property of Tenant and each of its Occupants from causes then insured under standard fire and extended coverage insurance policies, as well as arising out of any interruption of Tenant’s business or any loss of Tenant’s profits, regardless of whether its insurance policies in effect at the time of such damage or destruction permit such waiver. If, at any time during the Term, any insurance carrier which shall have issued a policy to Landlord covering the Real Property, the Premises, the Building shall refuse to consent to the waiver of the right of recovery with respect to any loss payable under such policy, or if such carrier shall consent to such waiver only upon the payment of an additional premium (unless such additional premium is voluntarily paid by one of the parties hereto) or shall cancel a consent previously given, or shall cancel or threaten to cancel any policy previously issued and then in force, the waiver by Landlord in this Paragraph 10.1 shall thereupon be of no further force and effect as to the loss, damage or destruction covered by such policy.

11. Condemnation and Other Proceedings.

11.1. If all or any portion of the Premises or the Building shall be acquired pursuant to or condemned in eminent domain proceedings or by giving of a deed in lieu thereof, or if all or any portion of the Premises or the Building shall be ordered demolished or declared unfit for present use by any governmental body, or if, as a result of any condemnation or order affecting all or any portion of the Premises or the Building, substantial alteration or reconstruction of the Building or the Premises shall, in the opinion of Landlord, be necessary or desirable, then and in any such event this Lease and the term and estate hereby granted may be terminated by Landlord on sixty (60) days’ written notice (or such lesser period as may be necessary under the circumstances in order for Landlord to comply with the applicable ruling or order of any governmental body).

11.2. If Landlord does not exercise its option to terminate this Lease as herein above set forth in Paragraph 11.1, and if the Premises are reduced in size due to an event described in Paragraph 11.1, the Basic Rent and Additional Rent payable by Tenant for the remaining usable portion of the Premises shall be equitably apportioned and abated.

11.3. In the event of any termination under this Paragraph 11, Tenant shall have no claim against Landlord or the condemning authority for the value of any unexpired Term and shall have no other claim against Landlord excepting the adjustment of the Basic Rent and Additional Rent as herein above mentioned, nor shall Tenant be entitled to, and Tenant waives any interest in, any portion of any amount that may be awarded as compensation or damages or paid as a result of such proceedings or as the result of any agreement made by any governmental authority with Landlord.

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11.4. Tenant may, if allowed by statute, seek such awards or damages for moving expenses, loss of movable trade fixtures and other movable equipment installed by it (if any) which do not, under the terms of this Lease, become the property of Landlord. Such awards or damages must be made by a condemnation court or other authority and must be separate and distinct from any award to Landlord in connection with the Real Property and shall not diminish any award of Landlord.

12. Assignment and Subletting.

12.1. Tenant shall not, without the prior written consent of Landlord in each instance, by operation of law or otherwise, assign this Lease, sublet the Premises or any part thereof, mortgage or encumber this Lease, or permit the Premises to be used by others. Any attempt to do so by Tenant shall be void. The consent by Landlord to any assignment, mortgage, encumbrance, subletting or use of the Premises by others in any one or more instances shall not constitute a waiver of Landlord’s right to withhold its consent to any other assignment, mortgage, encumbrance or use of the Premises by others. Neither this Lease nor the interest of Tenant herein or any assignee of Tenant herein shall pass by operation of law or be subject to garnishment or sale in connection with any suit or proceeding which may be brought by or against Tenant or any assignee of Tenant.

12.2. Subject to the provisions of Paragraph 12.4 hereof, Landlord covenants and agrees that it will not unreasonably withhold its consent to Tenant’s assigning or subletting all or a part of the Premises. Without limiting the general nature of the prior sentence, it shall be reasonable for Landlord to refuse to consent to any proposed subletting or assigning if: (i) any mortgagee refuses to consent to such subletting or assigning; or (ii) the proposed subtenant or assignee (or an affiliate thereof) is a tenant in the Building; or (iii) if the proposed subtenant or assignee has viewed space to rent in the Building within the four months immediately prior to Tenant’s request for consent; or (iv) there shall be a Default at the time of any request for consent under the terms of Paragraph 12; or (v) the proposed assignee or subtenant desires to use the Premises for any use other than the Permitted Use. Further, any consent delivered by Landlord shall be automatically and retroactively revoked, without any act by Landlord, if a Default shall exist on the effective date of such subletting or assigning.

12.3. If Tenant requests Landlord’s consent to an assignment of this Lease or a subletting of all or any part of the Premises, Tenant shall submit to Landlord:

●        The sum of three hundred dollars ($300.00) as a nonrefundable fee to process each such request;

●        the name of the proposed assignee or subtenant;

●        the terms of the proposed assignment or subletting;

●        the nature of the proposed subtenant’s or assignee’s business; and

●        such information as to the proposed subtenant’s or assignee’s identity, financial responsibility and general reputation as Landlord may reasonably require.

12.4. Upon the receipt of such request and information from Tenant, Landlord shall have the option, to be exercised in writing within thirty (30) days after such receipt, to either (1) cancel and terminate this Lease if the request is to assign this Lease or to sublet all or substantially of the Premises; or (2) grant or deny said request based upon the reasonableness standard set forth in Paragraph 12.2 above. In determining whether to consent to Tenant’s proposed sublessee or assignee, Landlord may consider, without limitation, such party’s financial standing, character and business.

12.5. If Landlord shall give notice of its election to cancel this Lease pursuant to Paragraph 12.4 hereof, Tenant shall surrender possession of the Premises or the portion of the Premises which is subject of the request, as the case may be, 30 days after the date set forth in such notice and in accordance and compliance with the provisions of this Lease relating to surrender of the Premises.

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12.6. If Landlord shall consent to a sublease or assignment pursuant to the request from Tenant, Tenant shall cause to be executed by its assignee or subtenant an agreement, in such form as Landlord shall reasonably prescribe, to perform faithfully and to assume and be bound by all of the terms, covenants, conditions, provisions and agreements of this Lease. Tenant shall also deliver an executed copy of each sublease or assignment and assumption, in such form as Landlord shall reasonably prescribe, not less than five (5) days prior to the commencement of occupancy set forth in such assignment or sublease. If Tenant realizes any profit from such assignment or sublease, Tenant shall pay over to Landlord 100% of said profit as and when it is collected by Tenant. For purposes of this subsection, “profit” shall mean any amount per square foot paid to Tenant in relation to the Premises for a specific period of time which exceeds the amount per square foot that Tenant is obligated to pay to Landlord in relation to the Premises for that period of time, net of actual and reasonable expenses incurred in connection with the subletting or assignment transaction in question, amortized over the term of the transaction in question.

12.7. In no event shall any assignment or subletting release or relieve Tenant from its obligations under this Lease, whether arising prior to or after such event.

13. Surrender.

13.1. Upon the Expiration Date or the sooner expiration of the Term, Tenant shall peaceably and quietly quit and surrender to Landlord the Premises, broom clean, in as good condition as they were in on the Commencement Date, ordinary wear and tear, casualty and condemnation and Alterations permitted by Landlord to remain, excepted. Tenant’s obligation to observe or perform this covenant shall survive the Expiration Date or prior expiration of the Term. If the Expiration Date falls on a Saturday or Sunday or a legal holiday, this Lease shall expire at 12:00 noon on the business day first preceding said date.

14. Holding Over.

14.1. If Tenant holds possession of the Premises beyond the Expiration Date or sooner expiration of the term, Tenant shall be obligated to pay DOUBLE the Basic Rent and Additional Rent payable hereunder during the last Lease Year, and shall be bound by all of the other terms and conditions of this Lease. Nothing contained in this Lease shall be construed as a consent by Landlord to the occupancy or possession by Tenant of the Premises beyond the Expiration Date or sooner expiration of the Term, and Landlord, upon said Expiration Date or sooner expiration of the Term, shall be entitled to the benefit of all legal remedies that now may be in force or may be hereafter enacted relating to the speedy repossession of the Premises and to all damages to which Landlord is entitled, including, without limitation, any damages suffered by Landlord due to Landlord’s inability to timely deliver the Premises to a new tenant.

15. Landlord’s Right to Entry.

15.1. Landlord and Landlord’s agents and representatives shall have the right to enter into or upon the Premises, or any part thereof, to conduct, and shall have the right to perform, the following:

●        examinations of the Premises;

●        the making of such repairs or alterations therein as may be necessary in Landlord’s sole judgment for the safety and preservation thereof;

●        the erection, maintenance, repair or replacement of wires, cables, conduits, vents or Building Systems running in, to or through the Premises; and

●        the exhibition of the Premises to prospective new tenants, purchasers or mortgagees.

15.2. Landlord, in exercising any of its rights under this Paragraph 15, shall not be deemed to have caused an eviction, partial eviction, constructive eviction or disturbance of Tenant’s use or possession of the Premises and shall not be liable to Tenant for same.

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15.3. Except in the case of any event which Landlord deems to constitute an emergency, which determination shall be in Landlord’s sole and unfettered judgment, all alterations or repairs performed by or on behalf of Landlord in or on the Premises pursuant to this Paragraph 15 shall be performed with as little inconvenience to Tenant’s business as is reasonably practicable under the circumstances.

16. Default.

16.1. Each of the following, whether occurring before or after the Commencement Date, shall be deemed a default by Tenant and a breach of this Lease (hereinafter, a “Default”):

●        the filing of a petition by or against Tenant for adjudication as a bankrupt, or for reorganization, or for arrangement under any bankruptcy act;

●        the commencement of any action or proceeding for the dissolution or liquidation of Tenant, whether instituted by or against Tenant, or for the appointment of a receiver or trustee of the property of Tenant under any state or federal statute for relief of debtors;

●        the making by Tenant of an assignment for the benefit of creditors;

●        the suspension of business by Tenant or any act by Tenant amounting to a business failure;

●        the filing of a tax lien or mechanics’ lien against any property of Tenant;

●        Tenant’s causing or permitting the Premises to be vacant or abandonment of the Premises for a period in excess of ten (10) days;

●        failure by Tenant to pay Landlord when due hereunder Basic Rent, Additional Rent or any other sum required to be paid by Tenant under the terms of this Lease; or

●        failure by Tenant to perform when required hereunder any other term, covenant, agreement or condition of this Lease required to be performed by Tenant.

17. Landlord’s Rights Upon Tenant’s Default.

17.1. If, (i) in the case of a Default based upon the nonpayment of Basic Rent, Additional Rent or any other sum of money due to Landlord hereunder, Tenant fails to cure such Default by paying such sum within five (5) days after the date Landlord gives notice that the same is unpaid and overdue, or (ii) in the case of any other Default, Tenant fails to cure such Default within fifteen (15) days after notice thereof is given by Landlord, Landlord may immediately or at any time thereafter, without further notice to Tenant, (i) enter upon the Premises as agent for Tenant, by legal entry, without terminating this Lease and do any and all acts Landlord may deem necessary, proper or convenient to cure such Default, for the account of and at the expense of Tenant, and Tenant agrees to pay Landlord, upon demand, all damages and expenses incurred by Landlord in so doing; or (ii) terminate this Lease and Tenant’s right to possession of the Premises and, with or without legal process, take possession of the Premises and remove Tenant, any occupant and any property therefrom, without being guilty of trespass, without liability whatsoever to Tenant and without relinquishing any rights of Landlord against Tenant.

17.2. In the event this Lease is so terminated, Tenant shall vacate the Premises on the termination date as if such date were the originally scheduled Expiration Date, and shall pay to Landlord as damages an amount equal to the amount herein covenanted to be paid as Basic Rent and Additional Rent throughout the entire Term (as if same had not expired until the originally scheduled Expiration Date), together with: (i) all expenses of any proceedings (including, but not limited to, reasonable legal expenses and attorney’s fees) which Landlord incurs in order to recover possession of the Premises; (ii) all reasonable expenses of re-letting the Premises including, but not limited to, commissions paid to real estate brokers, advertising expenses and the reasonable cost of such alterations, repairs, replacements and decoration or redecoration as Landlord, in the reasonable exercise of its judgment, considers advisable and necessary for the purposes of re-renting the Premises; and (iii) any and all other sums which are provided to be paid by Tenant hereunder in the event of its Default; provided, however, that there shall be credited against the amount of such damages all amounts received by Landlord from such re-renting of the Premises.

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17.3. Landlord may maintain separate actions against Tenant each month to recover the damages incurred in such month without waiting until the end of the Term to determine the aggregate amount of such damages, or Landlord, at its option, if the Premises have been re-let for a term extending at least as long as the remainder of the Term hereof, may recover from Tenant in advance for the entire deficiency to be realized during the term of the re-letting. Tenant hereby expressly waives any and all rights of redemption granted by or under any present or future laws in the event of the eviction of Tenant, or in the event of Tenant’s being dispossessed for any cause, or in the event of Landlord’s obtaining possession of the Premises by reason of the violation by Tenant of any of the covenants or conditions of this Lease.

17.4. Landlord may apply against the damages due in the event of Tenant’s Default any Basic Rent, Additional Rent, Security Deposit or other moneys received from Tenant or others on behalf of Tenant or in connection with the Lease.

17.5. To secure the payment of any and all sums payable by Tenant hereunder and to assure Tenant’s faithful performance of its obligations hereunder, Tenant hereby grants to Landlord an express contractual lien on and security interest in all property, chattels and merchandise in the Premises and in all proceeds of any insurance which may accrue to Tenant by reason of damage to or destruction of any such property, chattels or merchandise. Landlord shall have the right, as agent for Tenant, to take possession of any furniture or fixtures of Tenant found upon the Premises after taking possession of the same pursuant to the Paragraph 17 and may sell the same at any private or public sale and apply the proceeds to any amount due Landlord. Tenant waives any notice of execution or levy in connection therewith.

18. Landlord’s Remedies Cumulative; Expenses.

18.1. No remedy provided to Landlord pursuant to this Lease shall be deemed an exclusive remedy, but rather all rights and remedies of Landlord herein enumerated shall be cumulative, and none shall exclude any other right or remedy allowed by law or at equity. All such remedies may be exercised from time to time in such order and in such combination as Landlord elects. For the purposes of any suit based upon the provisions hereof, this Lease shall be construed to be a divisible contract toward the end that successive actions may be maintained on this Lease as successive periodic sums become due hereunder.

18.2. Tenant agrees to pay, upon demand, all of Landlord’s reasonable costs, charges and expenses, including Landlord’s legal fees and legal costs, which Landlord incurs in collecting from Tenant the sums that Tenant is obligated to pay hereunder and in enforcing Landlord’s remedies and Tenant’s obligations hereunder.

18.3. If Tenant fails to pay any installment of Basic Rent, Additional Rent or any other sum due and payable to Landlord on or before the day such installment becomes due and payable, Tenant shall pay to Landlord (i) a late charge (to cover Landlord’s administrative and overhead expenses of processing late payments) equal to the greater of one hundred ($100.00) dollars or five percent (5%) of the amount of such installment, and (ii) interest on such unpaid installment at a rate per annum which is two (2%) percent greater than the “prime rate”, “base rate” or “reference rate”, as fixed from time to time by Citibank, NA (or its successor) then in effect (or if such prime rate, base rate, or reference rate is not available, a replacement rate reasonably designated by Landlord) from the date such installment became due and payable to the date of payment thereof by Tenant; provided, however, that nothing herein contained shall (a) entitle Tenant to not make payment of any sum required to be paid hereunder as and when due or (b) be construed or implemented in such a manner as to allow Landlord to charge or receive interest in excess of the maximum legal rate then allowed by law. Should Landlord receive any payment which is judicially determined to be in excess of the maximum legal rate allowed by law, such excess amount shall be refunded promptly to Tenant, this Lease shall remain in full force and effect, and Landlord shall have no further liability in connection therewith.

18.4. All late charges and interest payable hereunder shall constitute Additional Rent hereunder and shall be due and payable on demand.

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19. No Waiver.

19.1. Landlord shall not be deemed to have waived any of its rights or remedies hereunder unless such waiver shall be in writing and signed by Landlord. No waiver by Landlord of any breach by Tenant of any of the terms, covenants, agreements, or conditions of this Lease shall be deemed to constitute a waiver of any succeeding breach thereof or of any breach of any of the other terms, covenants, agreements and conditions herein contained.

19.2. No offer of surrender of the Premises, by delivery to Landlord or its agent or employee of keys to the Premises or otherwise, will be binding on Landlord unless accepted by Landlord, in a writing pursuant to which Landlord expressly agrees to the effective surrender of the Premises. At the expiration or termination of the Lease Term, Tenant shall deliver to Landlord all keys, “swipe” cards and similar items to the Premises and make known to Landlord the location and combinations of all locks, safes and similar items.

19.3. The receipt by Landlord of Basic Rent or Additional Rent payable hereunder with knowledge of the breach of any covenant of this Lease shall not be deemed a waiver of such breach. No payment by Tenant or receipt by Landlord of a lesser amount than the Basic Rent or Additional Rent then due shall be deemed to be other than on account of the earliest amount then due pursuant to the terms hereof, nor shall any endorsement or statement on any check or in any letter or other instrument accompanying any check or payment of Basic Rent or Additional Rent be deemed binding on Landlord in any manner whatsoever or an accord and satisfaction. Landlord may accept such check or payment without prejudice to Landlord’s rights hereunder, including Landlord’s right to recover the balance of such Basic Rent or Additional Rent or to pursue any other remedy provided in this Lease. No receipt of money by Landlord from Tenant after the Expiration Date (or sooner termination) shall reinstate, continue or extend the Lease Term, unless Landlord specifically agrees to same in a writing signed by Landlord at such time.

19.4. The failure of Landlord to enforce any of the Rules or Regulations as may be set by Landlord from time to time against Tenant or against any other tenant in the Building shall not be deemed a waiver of any such Rule or Regulation.

20. Landlord’s Reserved Rights.

20.1. If, during or prior to the last ninety (90) days of the Term, Tenant vacates the Premises, Landlord may enter the Premises immediately to decorate, remodel, repair, alter or otherwise prepare the Premises for occupancy by a new tenant, without liability to Tenant and without affecting Tenant’s obligation to pay the Basic Rent and Additional Rent payable hereunder which accrues through and including the Expiration Date.

20.2. Landlord has the right to make changes in and about the Building, garages and parking facilities, including, but not limited to, signs, entrances or address. Such changes may include, but not be limited to, rehabilitation, redecoration, refurbishment and re-fixturing of the Building, and expansion of or structural changes to the Building, and the redesign of the lobby, the Building doorways, the hallways, the hallway doorways, or other common areas. Without limiting the general nature of the prior sentence, Landlord may increase the leasable space of the Building by reducing the size of what is currently the lobby. Landlord has the right to change the street address and name of the Building. The right of Tenant to quiet enjoyment and peaceful possession given under the Lease will not be deemed breached or interfered with by reason of Landlord’s actions pursuant to this paragraph so long as such actions do not materially deprive Tenant of its use and enjoyment of the Premises.

21. Landlord’s Liability.

21.1. Landlord shall not be liable for any injury, damage or loss to persons or property resulting from fire, explosion, falling plaster, steam, gas, electricity, water, rain, snow or leaks from any source whatsoever, or any theft of the property or possessions of Tenant or its Occupants.

21.2. Anything contained in this Lease to the contrary notwithstanding, Tenant agrees that it shall look solely to the estate of Landlord in the Real Property for the collection of any judgment (or other judicial process) requiring the payment of money by Landlord for any Default or breach by Landlord of any of its obligations under this Lease or otherwise. No other assets of Landlord shall be subject to levy, execution or other judicial process for the satisfaction of Tenant’s claim. This provision shall not be deemed, construed or interpreted to be or constitute an agreement, express or implied, between Landlord and Tenant that Landlord’s interest in the Real Property shall be subject to impressment of an equitable lien or any other similar type of lien. Tenant’s sole right against Landlord for any failure to give any consent or approval required of Landlord hereunder shall be an action for specific performance to compel Landlord to give the required consent or approval, and Tenant hereby specifically disclaims any right to damages as against Landlord on account of any such failure to give consent or approval.

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22. Tenant’s Liability.

22.1. Tenant shall reimburse Landlord for all expenses, damages or fines, reasonable legal fees and costs incurred or suffered by Landlord by reason of any breach, violation or nonperformance by Tenant of any covenant or provision of this Lease, including, without limitation, any action commenced against Tenant or Landlord, or by reason of damage to persons or property caused by moving property of or for Tenant in or out of the Building or by the installation or removal of furniture, fixtures or other installations or property of or for Tenant, or by reason of or arising out of the carelessness, negligence or improper conduct of Tenant or any of its Occupants. Any such amount so payable shall be deemed Additional Rent and shall be due and payable by Tenant upon demand.

22.2. Tenant shall not do or permit or suffer any act or thing to be done upon the Premises which may subject Landlord, its partners, members, managers, shareholders, officers, directors, employees, agents (including, without limitation, leasing and managing agents) and contractors (together collectively, “Indemnitees”) to any liability or responsibility for injury, damages to persons or property or to any liability by reason of any violation of law or of any Legal Requirement, but shall exercise such control over the Premises as to fully protect In-demnitees against any such liability. Tenant shall “indemnify”, defend, protect, save and hold harmless the Indemnitees and each of them from and against (i) all claims against In-demnitees of whatever nature arising from any act, omission or negligence of Tenant, or any of its Occupants; (ii) all claims against Indemnitees arising from any incident, accident, injury or damage whatsoever caused to any person or to the property of any person and occurring during the term of this Lease in or about the Premises, and (iii) any breach, violation or nonperformance of any covenant, condition or agreement in this Lease set forth and contained on the part of Tenant to be fulfilled, kept, observed or and performed. Throughout this Lease, when Tenant is to “indemnify” Landlord or any other person from any “claim”, Tenant’s obligation shall be to indemnify, defend, protect, save and hold Landlord and each such other person harmless from and against any and all liability, obligations, damages, penalties, claims, causes of action, fines, suits, demands, costs and expenses of any kind or nature incurred in or in connection with any event giving rise to the obligation to “indemnify” including, without limitation, attorneys’ fees and disbursements in consultation, at trial, and on appeal. Indemnitees, from time to time, may submit to Tenant copies of Indemnitees’ bills in connection with the foregoing, and Tenant upon receipt of such bills shall promptly pay to Landlord, as Additional Rent, the amount shown on such bills.

22.3. If any claim, action or proceeding is made or brought against any Indemnitee, which claim, action or proceeding the Tenant shall be obligated to indemnify against pursuant to the terms of this Lease, then, upon demand by Landlord, Tenant, at its sole cost and expense, shall resist or defend such claim, action or proceeding in the Indemnitee’s name, if necessary, by such attorneys as such Indemnitee shall reasonably approve. Notwithstanding the foregoing, Indemnitee may retain its own attorneys to defend or assist in defending any claim, action or proceeding (a) involving potential liability of One Million Dollars ($1,000,000) or more, or (b) which Landlord reasonably believes is not being defended competently or in good faith, and Tenant shall pay the reasonable fees and disbursements of such substituted attorneys. The provisions of this Paragraph shall survive the expiration or earlier termination of this Lease.

23. Tenant’s Insurance.

23.1. Tenant covenants to provide on or before the Commencement Date and throughout the Term for the benefit of Landlord, Landlord’s mortgagee, Landlord’s Managing Agent and Tenant:

●        A comprehensive policy of liability insurance and/or Certificate of Insurance, with a deductible not exceeding $2,500, protecting Landlord, Landlord’s mortgagee, Landlord’s Managing Agent and Tenant against any liability whatsoever occasioned by accident on or about the Real Property, the Building or the Premises or any appurtenances thereto. Such policy is to be written by insurance companies qualified to do business in the State of New Jersey and which are rated “Grade A-X” or better in Best’s and at limits of liability in minimum amounts approved by Landlord from time to time in respect of any one person, in respect of any one accident and in respect to property damage. The original amounts thereof are as set forth in Item M of the Basic Lease Provisions. Such insurance may be carried under a blanket policy covering the Premises and other locations of Tenant, if any.

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●        Fire and Extended Coverage, Vandalism, Malicious Mischief and Special Extended Coverage Insurance in an amount adequate to cover the cost of replacement of all personal property, decorations, trade fixtures, furnishings and equipment in the Premises and all contents therein. Landlord shall not be liable for any damage to property of Tenant by fire or other peril, no matter how caused, it being understood that Tenant will look solely to its insurer for reimbursement.

23.2. Prior to the time such insurance is first required by this Paragraph 23 to be carried by Tenant and thereafter, at least thirty (30) days prior to the expiration of any such policy, Tenant agrees to deliver to Landlord either a duplicate original of the aforesaid policy or a certificate evidencing such insurance. Said certificate shall contain an endorsement that such insurance may not be canceled except upon thirty (30) days’ notice to Landlord, together with evidence of payment for the policy.

23.3. Upon failure at any time on the part of Tenant to procure and deliver to Landlord the policy or certificate of insurance, as herein above provided, Landlord shall be at liberty, but shall not be obligated in any way whatsoever, from time to time, as often as such failure shall occur, to procure such insurance and to pay the premium therefor, and any sums paid for insurance by Landlord shall be and become Additional Rent and due immediately. Payment by Landlord of such premium or the carrying by Landlord of any such policy shall not be deemed to waive or release Tenant’s Default with respect thereto.

23.4. Tenant will not do or permit anything to be done upon or bring or keep or permit anything to be brought or kept upon the Premises which will increase Landlord’s rate of insurance on the Building. If by reason of the failure of Tenant to comply with the terms of this Lease, or by reason of Tenant’s occupancy (even though permitted or contemplated by this Lease), the insurance rate charged to Landlord shall at any time be higher than it would otherwise be, Tenant will reimburse Landlord for that part of all insurance premiums charged because of such violation or occupancy by Tenant. Tenant agrees to comply with any reasonable requests or recommendation made by Landlord’s insurance underwriter.

24. Quiet Enjoyment.

24.1. Landlord covenants and agrees that, upon the performance by Tenant of all of the covenants, agreements and provisions hereof on Tenant’s part to be kept and performed, Tenant shall have, hold and enjoy the Premises, subject to the rights, limitations and terms herein described, free from any interference whatsoever by, from or through Landlord.

24.2. Notwithstanding the foregoing, no diminution or abatement of Basic Rent, Additional Rent or other payment due to Landlord shall be claimed by or allowed to Tenant for inconvenience or discomfort arising from the making of any repairs, improvements or alterations to the Premises or the Real Property if the same are made to comply with any law, ordinance or order of any governmental authority or which are necessary, in the judgment of Landlord, for the maintenance, repair, operation, or improvement of the Real Property.

25. Landlord’s Services.

25.1. Subject to Paragraph 37.3, Landlord shall furnish to Tenant the services set forth in this Lease and the Rules and Regulations as services which are covered by the Basic Rent.

25.2. Landlord shall furnish ventilation, air heating and air cooling, but only between the hours of 8:00 A.M. and 6:00 P.M., Mondays through Fridays (hereinafter referred to as the “Business Hours”), Saturdays, Sundays and Building Holidays excluded, and then only when weather conditions, in the opinion of Landlord, require. As used herein, the term “Building Holidays” shall mean all State and Federal holidays including, but not limited to: Martin Luther King’s Day, President’s Day, Memorial Day, Independence Day, Labor Day, Columbus Day, Veteran’s Day, Thanksgiving Day, the day after Thanksgiving Day, Christmas Day and New Year’s Day.

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25.3. If Tenant shall request the use of air cooling, ventilation and/or heat at any time other than the Business Hours in this Lease provided for such services, Landlord shall furnish such to Tenant provided (i) that Tenant pays to Landlord, as Additional Rent, a special overtime charge therefor which shall be initially $90.00 per hour (Landlord may adjust such figure from time to time), and (ii) that Tenant’s request shall be received in writing by Landlord’s property manager by 12:00 noon at least one business day before such service is required.

25.4. Throughout the Term, Landlord agrees to redistribute electrical energy to the Premises (not exceeding the present electrical capacity at the Premises), upon the following terms and conditions: (i) Tenant shall pay for such electrical energy as provided by this Lease; (ii) Landlord shall not be liable in any way to Tenant for any loss, damage or expense which Tenant may sustain or incur as a result of any failure, defect or change in the quantity or character of electricity furnished to the Premises or if such quantity or character of electricity furnished to the Premises is no longer available or suitable for Tenant’s requirements or due to any cessation, diminution or interruption of the supply thereof.

25.5. The parties agree that Tenant will pay for the electric during the Term in such amounts as may be determined under one of the provisions of “(x)” or “(y)” set forth below. The parties agree that the provisions of “(x)” below shall initially apply, but that Landlord will be entitled to elect to change the applicable provision at any time during the Term on notice to Tenant. The amount required to be paid hereunder shall be payable in monthly installments, as Additional Rent, and shall be either, in Landlord’s discretion:

(x) the fixed electricity charge set forth in Item D of the Basic Lease Provisions; or

(y) the amount that is calculated as the Landlord’s cost of furnishing electricity to the Premises as determined by an independent electrical engineering consultant selected by Landlord, based upon a survey and determination of the average monthly electrical consumption of the lighting fixtures and the electrical equipment of Tenant used in the Premises and based further on the utility rates being charged to Landlord, as such rates are set from time to time. Landlord shall have the right to survey the electrical consumption of Tenant at any time during the Term, but no more often than quarterly. The findings of said consultant as to the average monthly electrical consumption of Tenant shall be conclusive and binding on the parties hereto.

25.6. Landlord shall replace as required, at Tenant’s sole cost and expense, all of Landlord’s light bulbs, fluorescent and incandescent lamps, starters and ballasts used by Tenant in the Premises.

25.7. Tenant covenants that its use of electricity in the Premises shall be limited to and for the operation of (i) building-standard lighting, and (ii) personal computers, electric typewriters, calculators, copying machines and other small office machines.

25.8. Tenant shall make no alteration to the existing electrical equipment or connect any fixtures, appliances or equipment in addition to the equipment permitted in the following subparagraph without the prior written consent of Landlord in each instance. Should Landlord grant such consent, all additional risers or other equipment (if any) required therefor, in Landlord’s judgment, shall be provided by Landlord and the cost thereof shall be paid by Tenant upon Landlord’s demand. As a condition to granting such consent, Landlord may require an increase in the monthly electrical charge by an amount which will reflect the cost of electricity to operate the additional equipment and service to be furnished by Landlord. Absent agreement as to this charge between Landlord and Tenant, this increase shall be determined by an independent electrical engineer, to be selected by Landlord and whose services shall be paid for by Tenant.

25.9. Landlord shall not be liable in the event of any interruption in the supply of electricity, and Tenant agrees that such supply may be interrupted for inspection, repairs, replacements and in emergencies.

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25.10. Landlord shall furnish, without cost to Tenant, cleaning services on Mondays through Fridays, Saturdays, Sundays and Building Holidays excluded. Such services shall consist of general cleaning of all common areas of the Building and general cleaning of the Premises, all in accordance with such standards and specifications as Landlord shall, from time to time, determine. Tenant is responsible for cleaning of the restroom and the Kitchenette located within the Premises. Notwithstanding the foregoing, Tenant shall pay for any and all reasonable costs incurred by Landlord in disposing of Tenant’s debris and garbage to the extent the same exceeds normal, everyday “office wastebasket” debris.

25.11. The failure of Landlord to furnish any service hereunder during such reasonable periods as necessary repairs or replacements are underway, or the discontinuation of any service currently provided by commercial tenants of the Building located in the Building lobby or elsewhere, shall not be construed as a constructive eviction of Tenant, shall not excuse Tenant from performing any of its obligations hereunder and shall not give Tenant any claim against Landlord for damages for failure to furnish such service.

26. Additional Rent.

26.1. Tenant hereby covenants and agrees to pay as Additional Rent the amounts set forth below.

26.2. For each year or part of a year occurring within the Term in which the total annual real estate taxes, assessments (including special assessments), personal property tax, sewer rents, rates and charges (hereinafter referred to collectively as the “Real Estate Taxes”) which shall be levied, imposed or assessed upon the Real Property shall exceed the Real Estate Taxes levied, imposed or assessed for the Base Tax Year, Tenant shall pay Tenant’s Proportionate Share of such excess. Landlord may, from time to time, notify Tenant of Landlord’s estimate of Tenant’s Proportionate Share of the excess Real Estate Taxes for any calendar year and Tenant shall be obligated to pay Landlord, as Additional Rent along with each monthly installment of Base Rent due during such calendar year, 1112th of such estimated amount. Tenant’s payments of such estimated amount shall be treated by Landlord as a credit against the actual amount required to be paid by Tenant pursuant to this Paragraph 26.2. Any overpayment which may have been made by virtue of such estimated payments shall be returned by Landlord to Tenant when the actual amount payable by Tenant can be calculated.

26.3. Notwithstanding the foregoing, Landlord may take the benefit of the provisions of any statute or ordinance permitting any Real Estate Tax to be paid over a period of time.

26.4. The amount payable by Tenant under Paragraph 26.2 shall be calculated based upon the amount billed by the taxing jurisdiction, and shall be set forth in a statement prepared by Landlord and furnished to Tenant and which provides a computation of any amounts due to Landlord.

26.5. If Landlord shall receive any tax refund in respect of any tax year during the Term following the Base Tax Year, Landlord shall deduct from such tax refund any expenses incurred in obtaining such tax refund and, out of the remaining balance of such tax refund, Landlord shall credit to Tenant Tenant’s Proportionate Share of such balance. Any expenses incurred by Landlord in contesting the validity or the amount of the assessed valuation of the Real Property or of any Real Estate Taxes for any year after the Base Tax Year, to the extent not offset by a tax refund, shall be included as an item of and shall be added to Real Estate Taxes for the tax year in which such contest shall be finally determined, for the purpose of computing the Additional Rent due Landlord hereunder.

26.6. If the tax year for Real Estate Taxes shall be changed, then an appropriate adjustment shall be made in the computation of the amount due to Landlord or credit due to Tenant. If, because of any change in the method of taxation of real estate, one or more other taxes or assessments are imposed upon one or more of Landlord, or the owner of the Real Property or the Building, or upon or with respect to the Real Property or the Building or the rents or income therefrom, whether in substitution for or in lieu of or in addition to any tax or assessment which would otherwise be a Real Estate Tax, such other tax or assessment shall be deemed Real Estate Taxes for the purposes herein.

26.7. Only Landlord shall be eligible to institute tax reduction or other proceedings to reduce the Taxes.

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26.8. As used herein, the term “Landlord’s Operating Expenses” shall mean all costs and expenses paid or incurred by Landlord in connection with the ownership, operation, management, maintenance and repair of the Real Property including, without limitation, its equipment and mechanical systems, parking facilities, areas, decks, ramps and roadways, paving, walkways, landscaping and public facilities, and including but not limited to the cost and expenses of materials and supplies, electricity, water, fuel, cleaning, window cleaning, janitorial service, insurance, snow removal, painting, wallpapering, re-carpeting and otherwise redecorating and renovating public areas, replacement of worn out mechanical or damaged equipment including, without limitation, heating, ventilating and air conditioning equipment, uniforms, management fees, sundries, tools and equipment, excise taxes, gross receipt taxes, sales taxes and other like taxes, wages and salaries of all persons engaged by Landlord for the operation, maintenance and repair of the Real Property, costs of compliance by Landlord with and contests by Landlord of laws, regulations, ordinances and requirements of the federal, state or municipal government, of any department, subdivision, bureau or office thereof, or of any other governmental, public or quasi-public authorities now existing or hereafter created, legal and accounting expenses and any other costs and expenses other than mortgage debt service, costs reimbursed by insurance, construction costs incurred in connection with preparing space for a new tenant and real estate broker’s commissions. If a particular expenditure is for an item which, under generally accepted accounting principles, constitutes a capital improvement, then such expenditure shall be included as one of Landlord’s Operating Expenses for purposes hereof on a prorated basis, together with an imputed interest amount calculated on the unamortized portion of such expenditure using an interest rate of 12% per annum, over its useful life. Such useful life shall be obtained by dividing the amount of the expenditure in question by the useful life of the improvement to which it relates, as such useful life is determined by Landlord in the reasonable exercise of its business judgment (but in no event to exceed 10 years).

26.9. Tenant shall pay to Landlord as Additional Rent Tenant’s Proportionate Share of the amount by which Landlord’s Operating Expenses for any calendar year during the Term exceeds Landlord’s Operating Expenses during the Base Operating Year.

26.10. Approximately during the second month of each calendar year of the Term, or within a reasonable period of time thereafter, Landlord shall submit to Tenant a statement (hereinafter referred to as “Landlord’s Statement”) showing in reasonable detail Landlord’s Operating Expenses during the preceding calendar year and during the Base Operating Year. Within thirty (30) days thereafter, Tenant shall pay to Landlord Tenant’s Proportionate Share of the amount by which Landlord’s Operating Expenses for the preceding calendar year exceeded Landlord’s Operating Expenses for the Base Operating Year. Tenant or its representative shall have the right to examine Landlord’s books and records relating to the expenses of the Real Property only and only with respect to the items in the foregoing Landlord’s Statements, during normal business hours at any time within ten (10) days following the delivery by Landlord to Tenant of such Landlord’s Statement. Unless Tenant shall take written exception to any specific item contained in Landlord’s Statement within twenty (20) days after the Landlord’s Statement is delivered, the same shall be considered as final and binding upon Tenant. Any controversy with respect to any written exception shall be resolved by an independent certified public accountant mutually acceptable to Landlord and Tenant, and if such accountant cannot be agreed upon, then by arbitration. Such arbitration shall be conducted upon the request of Tenant, but only if Tenant is not in Default in respect of any of its obligations under the Lease and only if Tenant has paid in full to Landlord the sums shown owing by Tenant to Landlord pursuant to the Landlord’s Statement in question. Arbitration shall be before three arbitrators designated by the American Arbitration Association and in accordance with the rules and regulation of such Association. The expenses of the arbitration proceedings shall be borne by the party who does not prevail in said proceedings. The fees of counsel and experts and other witnesses engaged or called by the parties shall be paid by the respective party engaging or calling the same. Tenant covenants and agrees that Tenant will not directly or indirectly employ in connection with any dispute under this Lease relating to Operating Expenses any person or entity which is to be compensated, in whole or in part, on a contingency fee basis.

26.11. For each calendar year throughout the Term, Landlord may notify Tenant of Landlord’s best estimate of Tenant’s Proportionate Share of Operating Expenses for such calendar year above Base Operating Year Operating Expenses and, in such case, Tenant shall be obligated to pay Landlord, as Additional Rent along with each monthly installment of Basic Rent due during such calendar year, one-twelfth (1/12th) of such estimated amount. Tenant’s payments of estimated amounts shall be treated by Landlord as a credit against the actual amount required to be paid by Tenant pursuant to Paragraph 26.3. Any over-payment which may have been made by virtue of such estimated payments shall be returned by Landlord to Tenant when the actual amount payable by Tenant can be calculated.

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26.12. Any increase or decrease in Additional Rent under this Paragraph 26 shall be prorated for the final year of the Term if such year covers a period of less than twelve (12) months. In no event shall any adjustment in Tenant’s obligation to pay Additional Rent under this Paragraph 26 result in a decrease in the Basic Rent payable hereunder. Tenant’s obligation to pay Additional Rent and Landlord’s obligation to credit to Tenant any amount referred to in this Paragraph 26, for the final year of the Term shall survive the Expiration Date.

26.13. With respect to Tenant’s Proportionate Share of Operating Expenses in excess of the Base Operating Year, if the Building is not at least ninety percent (90%) occupied during the Base Operating Year or of any calendar year during the Term, then those items included within the Operating Expenses which are affected by variations in occupancy of the Building shall be increased by Landlord for such calendar year (or partial calendar year) to the amount that would have reasonably been incurred had Landlord provided such item to ninety percent (90%) of the rentable area of the Building.

27. Personal Property Taxes.

27.1. Tenant agrees to pay all taxes imposed on the personal property of Tenant, the conduct of its business and its use and occupancy of the Premises.

28. Security Deposit.

28.1. Simultaneous with the execution hereof, Tenant has deposited with Landlord the sum specified in Item H of the Basic Lease Provisions.

29. Use of Security Deposit.

29.1. In the event of a Default by Tenant in respect of any of the terms, covenants or conditions of this Lease, Landlord may use, apply or retain the whole or any part of the Security Deposit to the extent required for the payment of any Basic Rent, Additional Rent or any other sum as to which Tenant is in Default or for any sum which Landlord may expend or may be required to expend by reason of Tenant’s Default in respect of any of the terms, covenants or conditions of this Lease including, but not limited to, any damages or deficiency accrued before or after summary proceedings or other reentry by Landlord. If Landlord should utilize any portion of the Security Deposit, Tenant, upon demand, shall replenish such amount, so that the Security Deposit shall remain undiminished throughout the Term. Tenant shall fully and faithfully comply with all of the terms, covenants and conditions of this Lease, the portion of the Security Deposit not applied pursuant to the terms hereof shall be returned to Tenant after the Expiration Date and after delivery of possession of the Premises to Landlord, but without any interest thereon whatsoever. The application of the Security Deposit due to a Default shall not cure, waive or release the Default such that Landlord shall be estopped from exercising any of its other remedies.

29.2. Tenant shall not assign or encumber or attempt to assign or encumber the Security Deposit. Landlord shall not be bound by any such assignment, encumbrance, attempted assignment or attempted encumbrance.

29.3. In the event of a sale of the Real Property or a leasing thereof, Landlord shall have the right to transfer the Security Deposit to the vendee or lessee, as the case may be, and Landlord shall thereupon be released by Tenant from all liability for the return of such Security Deposit. In such case, Tenant agrees to look solely to the new landlord for the return of the Security Deposit. The provisions hereof shall apply to every transfer or assignment made of the Security Deposit to a new landlord.

30. Definition of Landlord.

30.1. The term “Landlord” as used in this Lease shall be deemed to mean only the owner, for the time being, of the Real Property and/or the Building or the owner of a lease of the Real Property. In the event of any transfer of title to or lease of the Real Property, the term “Landlord” shall be deemed only to apply to the transferee thereof, and the transferor and any person or entity theretofore serving as or constituting the “Landlord” hereunder shall be and hereby is entirely freed and relieved of all covenants and obligations of the Landlord hereunder.

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31. Notices.

31.1. Any notice or other communication referenced in this Lease (collectively, “notices”) by either party to the other, to be effective, shall be in writing, sent via registered or certified mail, return receipt requested, postage prepaid, or by reputable overnight courier such as Federal Express or UPS, addressed to Landlord or Tenant at their respective addresses as specified in Item J of the Basic Lease Provisions, or to such other address as either party shall hereafter designate by notice as aforesaid. All notices properly addressed shall be deemed served three (3) business days after the date of mailing or one business day after the date of delivery to the overnight courier. Attorneys to a party may deliver notices on behalf of that party.

32. Signs.

32.1. No sign, advertisement or notice shall be affixed to or placed upon any part of the Premises, the Building or the Real Property by Tenant, except in such manner and of such size, design and color as shall be approved in advance in writing by Landlord. Tenant will bear Landlord’s actual cost of fabricating and installing Tenant’s building-standard office entry door sign setting forth Tenant’s name and such logo as Tenant furnishes and Landlord approves, in Landlord’s judgment, reasonably exercised.

33. Notice of Defects and Accidents.

33.1. Tenant shall give Landlord immediate notice (i) in case of accident or injury on or about the Building or the Real Property involving Tenant or any of its Occupants, or (ii) of any defects in the Building or the Premises of which it becomes aware.

34. Rules and Regulations.

34.1. Tenant, on behalf of itself and its Occupants, agrees to comply with the Rules and Regulations attached hereto and incorporated by reference as Exhibit C. Landlord shall have and expressly reserves the right to make amendments thereto from time to time for the safety, care, maintenance, good operation and cleanliness of the Real Property and the Building, the preservation of good order therein and the general convenience of all the tenants. Tenant agrees to comply with such amended Rules and Regulations, after twenty (20) days’ written notice thereof from Landlord.

35. Directory.

35.1. Landlord shall furnish and maintain in the lobby of the Building a tenant directory of such style and type as Landlord shall determine. Tenant shall receive two (2) listings in such directory, in building-standard form. Additional listings shall be subject to availability, the existence of which shall be determined by Landlord, in its discretion. All listings shall be fabricated and installed at Tenant’s sole cost and expense.

36. Environmental Matters.

36.1. Tenant agrees to comply with all applicable environmental laws, rules and regulations, as same are amended from time to time, including but not limited to, the New Jersey Industrial Site Remediation Act (N.J.S.A. 13:1K6 et seq.) (“ISRA”). Tenant shall not conduct any activity in the Premises which shall cause it to be considered an “industrial establishment” under ISRA, or otherwise subject the Premises to the requirements of compliance with ISRA.

36.2. Tenant hereby agrees to execute such documents as Landlord reasonably deems necessary and to make such applications as Landlord reasonably requires to assure compliance with ISRA; and without limiting the generality of the foregoing will provide Landlord within ten (10) business days of Landlord’s request for the same, an affidavit in support of a request for a nonapplicability letter by Landlord in the form required under ISRA. Tenant shall bear all costs and expenses incurred by Landlord associated with any required ISRA compliance resulting from Tenant’s use of the Premises, including, but not limited to, state agency fees, engineering fees, cleanup costs, filing fees, and suretyship expenses. As used in this Lease, ISRA compliance shall include applications for determinations of nonapplicabil-ity by the appropriate Governmental Authority upon the “closure, termination or transfer” of Tenant’s operations at the Premises. The foregoing undertaking shall survive the termination or sooner expiration of the Lease and surrender of the Premises and shall also survive sale, or lease or assignment of the Premises by Landlord. Tenant shall immediately provide Landlord with copies of all written correspondence, reports, notices, orders, findings, declarations and other materials pertinent to Tenant’s compliance with the New Jersey Department of Environmental Protection’s (“DEP”) requirements under ISRA as they are issued or received by the Tenant.

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36.3. Tenant shall not generate, store, manufacture, refine, transport, treat, dispose of, or otherwise permit or suffer to be present on or about the Premises, Building or Real Property any “Hazardous Material”. As used herein, Hazardous Material shall be defined as any “hazardous chemical,” “hazardous substance” or similar term as defined in the Comprehensive Environmental Responsibility Compensation and Liability Act, as amended (42 U.S.C. 9601, et seg.), the New Jersey Industrial Site Remediation Act, as amended, (N.J.1.Ten.S.A. 13:1K-6 et seq.), the New Jersey Spill Compensation and Control Act, as amended, (N.J.S.A. 58:10-23.11b, et seg.), any rules or regulations promulgated thereunder, or in any other applicable federal, state or local law, rule or regulation dealing with environmental protection.

36.4. If Tenant breaches the obligations stated in this Paragraph 36, or if the presence of Hazardous Material on the Premises, the Building or the Real Property caused or permitted by Tenant results in contamination by Hazardous Material of the Premises, the Building, or the Real Property, Tenant shall “indemnify” Landlord from any and all “claims” arising out of such events including, without limitation, diminution in value of the Premises, the Building, or the Real Property, damages for the loss or restriction on use of rentable or usable space or of any amenity of the Premises, the Building, or the Real Property, damages arising from any adverse impact on marketing of space, and sums paid in settlement of claims, attorney’s fees, consultant fees and expert fees, which arise during or after the Term. This indemnification of Landlord by Tenant also includes, without limitation, costs incurred in connection with any investigation of site conditions or any cleanup, remediation, removal, or restoration work required by any federal, state or local governmental agency or political subdivision.

36.5. Without limiting the foregoing, if Tenant is responsible pursuant to the terms hereof for the presence of any Hazardous Material on the Premises, the Building, or the Real Property, then at Landlord’s election Tenant either shall promptly take all actions at its sole cost and expense as are necessary to return the Premises, the Building and the Real Property to the condition existing prior to the introduction of any such Hazardous Material to the Premises, the Building and/or the Real Property with contractors approved by Landlord, or Tenant shall not take such actions, but shall be solely responsible for the cost and expense of such actions as undertaken or directed by Landlord.

37. Miscellaneous.

37.1. Entire Agreement. This Lease contains the entire agreement between the parties, and any attempt hereafter made to change, modify, discharge or effect an abandonment of it in whole or in part shall be void and ineffective unless in writing and signed by the party against whom enforcement of the change, modification, discharge or abandonment is sought.

37.2. Waiver. Landlord and Tenant do hereby waive trial by jury in any action, proceeding or counterclaim brought by either of the parties hereto against the other on any matter arising out of or in any connection with this Lease, the relationship of Landlord and Tenant, Tenant’s use or occupancy of the Premises, and/or any claim, injury or damage, or any emergency or statutory remedy. In any action or proceeding by Landlord for eviction, Tenant waives the right to interpose any counterclaim in such eviction action.

37.3. Force Maleure. Landlord shall not be deemed in default with respect to its failure to perform any of the terms, covenants and conditions of this Lease on Landlord’s part to be performed, if such failure is due in whole or in part to any strike, lockout, labor dispute (whether legal or illegal), civil disorder, inability to procure materials, failure of power, conditions of supply and demand, restrictive governmental laws and regulations, governmental preemption in connection with a national emergency, riots, insurrections, war or other emergency, fuel shortages, accidents, casualties, Acts of God, acts caused directly or indirectly by Tenant (or Tenant’s agents, employees, guests or invitees), acts of other tenants or occupants of the Building, or any other cause beyond the reasonable control of Landlord. In such event, the time for performance by Landlord shall be extended by an amount of time equal to the period of the delay so caused. In any such event Tenant’s obligation to pay Basic Rent and Additional Rent and otherwise perform hereunder shall in no way be affected, impaired or excused.

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37.4. Broker. Each of Landlord and Tenant represents to the other that it has not dealt with any real estate broker in connection with this Lease, other than as specified in Item I of the Basic Lease Provisions, and each hereby indemnifies and agrees to hold the other harmless of and from any and all claims, liabilities, costs or damages, including reasonable legal fees and costs, which the other may sustain or incur as a result of a breach of this representation.

37.5. Separability. If any term or provision of this Lease or the application thereof to any person or circumstance shall, to any extent, be invalid or unenforceable, the remainder of this Lease, or the application of such term or provision to persons or circumstances other than those to which it is held invalid or unenforceable, shall not be affected thereby and all other terms and provisions of this Lease shall be valid and enforced to the fullest extent permitted by law.

37.6. Interpretation.

37.6.1.1. Whenever in this Lease any words of obligation or duty are used, such words shall have the same force and effect as though made in the form of covenants.

37.6.1.2. Words of any gender used in this Lease shall be held to include any other gender, and words in the singular number shall be held to include the plural, and vice versa, when the sense requires.

37.6.1.3. All pronouns and any variations thereof shall be deemed to refer to the neuter, masculine, feminine, singular or plural as the identity of Tenant requires.

37.6.1.4. This Lease shall be deemed to have been drafted by both Landlord and Tenant, each of whom has been represented by counsel or has had the opportunity to be so represented, and shall not be construed “against” either party as the draftsman thereof. Each provision hereof shall be deemed both a covenant and a condition and shall run with the land.

37.6.1.5. Tenant agrees that all of Tenant’s covenants and agreements herein contained providing for the payment of money and Tenant’s covenants to remove mechanics’ liens shall be deemed conditions as well as covenants, and that if default be made in any such covenants, Landlord shall have all of the rights provided for herein.

37.6.1.6. The parties mutually agree that the headings and captions contained in this Lease are inserted for convenience of reference only, and are not to be deemed part of or to be used in construing this Lease.

37.6.1.7. The covenants and agreements herein contained shall bind and inure to the benefit of Landlord and Tenant, and their respective successors and assigns, except as otherwise expressly provided herein.

37.6.1.8. This Lease shall be construed in accordance with the laws of the State of New Jersey.

37.7. No Recordation.

37.7.1. Tenant shall not record this Lease or a memorandum hereof.

37.8. No Partnership. Nothing contained in this Lease shall be deemed or construed to create a partnership or joint venture of or between Landlord and Tenant, or to create any other relationship between the parties hereto other than that of landlord and tenant.

37.9. Authority. Landlord and Tenant hereby covenant each for itself that each has full right, power and authority to enter into this Lease upon the terms and conditions set forth herein. If Tenant signs as a corporation, each of the persons executing this Lease on behalf of Tenant does hereby covenant and warrant that Tenant is a duly authorized and existing corporation, qualified to do business in the jurisdiction in which the Building is located, that the corporation has full right and authority to enter this Lease, and that each of the persons signing on behalf of the corporation was authorized to do so.

37.10. Examination of Lease. Submission of this Lease to Tenant shall not constitute reservation of or option to lease, and the same shall not be effective as a lease or otherwise or bind Landlord in any way whatsoever unless and until the same has been fully executed and delivered by both Landlord and Tenant.

37,11. First Right of Offer. Tenant shall have the right of First Offer on contiguous space in on the sixth floor with the exception of Suite 660.

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IN WITNESS WHEREOF, Landlord and Tenant have executed this Lease under seal on the day and year first herein above written.

LANDLORD:    H&M GROUP INC.

By:

TENANT:     JERRICK MEDIA

By:

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ADDENDUM TO LEASE AGREEMENT
SUITE 640 JERRICK MEDIA

REVISED BASIC RENT SCHEDULE

Jerrick Media (Tenant) shall pay the balance of the additional construction costs as follows.

The total additional cost of construction changes amount to $25,446.00

Tenant will pay $8,225.00 (eight thousand two hundred twenty-five), by May 15, 2018. The next payment in the amount of $8,225.00 (eight thousand two hundred twenty-five), shall be paid prior to the move in day.

The remaining $9,000.00 (nine thousand), shalt be distributed throughout the first five years of the lease agreement as additional rent. The new rent schedule is represented below as the addendum to the basic rent schedule of line item “D” reflecting the new monthly rent amounts. Tenant shall also pay the balance of $150.00 (one hundred fifty), which is the increased amount of the first months rent paid in advance.

Lease Year	Annual Amount		Monthly Amount
1	$	69,144.00	$	5,762.00
2	$	73,018.32	$	6,084.86
3	$	77,008.86	$	6,417.40
4	$	81,119.13	$	6,759.92
5	$	87,859.28	$	7,321.60
Electricity Charge	$	4,600.00	$	383.33

Date: May 15, 2018

BY:		BY:
	LANDLORD: H&M GROUP INC.		TENANT: JERRICK MEDIA

EX-31.1

 Exhibit 31.1

CERTIFICATION OF PRINCIPAL EXECUTIVE OFFICER

PURSUANT TO SECTION 302 OF THE

SARBANES-OXLEY ACT OF 2002

I, Jeremy Frommer, certify that:

1. I have reviewed this quarterly report on Form 10-Q of Jerrick Media Holdings, Inc.;

2. Based on my knowledge, this quarterly report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this quarterly report;

3. Based on my knowledge, the financial statements, and other financial information included in this quarterly report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this quarterly report;

4. The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal controls over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

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

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

c) evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation;

d) disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting;

5. The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent function):

a) all significant deficiencies in the design or operation of internal controls which could adversely affect the registrant’s ability to record, process, summarize and report financial data and have identified for the registrant’s auditors any material weaknesses in internal controls; and

b) any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal controls over financial reporting.

Date: August 20, 2018	By:	/s/ Jeremy Frommer
		Jeremy Frommer Chief Executive Officer

EX-31.2

Exhibit 31.2

CERTIFICATION OF PRINCIPAL ACCOUNTING OFFICER

PURSUANT TO SECTION 302 OF THE

SARBANES-OXLEY ACT OF 2002

I, Jeremy Frommer, certify that:

1. I have reviewed this quarterly report on Form 10-Q of Jerrick Media Holdings, Inc.;

2. Based on my knowledge, this quarterly report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this quarterly report;

3. Based on my knowledge, the financial statements, and other financial information included in this quarterly report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this quarterly report;

4. The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal controls over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

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

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

c) evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation;

d) disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting;

5. The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation, to the registrant’s auditors and the audit committee of registrant’s board of directors (or persons performing the equivalent function):

a) all significant deficiencies in the design or operation of internal controls which could adversely affect the registrant’s ability to record, process, summarize and report financial data and have identified for the registrant’s auditors any material weaknesses in internal controls; and

b) any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal controls over financial reporting.

Date: August 20, 2018	By:	/s/ Jeremy Frommer
		Jeremy Frommer Chief Financial Officer

EX-32.1

Exhibit 32.1

CERTIFICATION PURSUANT TO

18 U.S.C. SECTION 1350,

AS ADOPTED PURSUANT TO SECTION 906 OF

THE SARBANES-OXLEY ACT OF 2002

In connection with this Quarterly Report of Jerrick Media Holdings, Inc. (the “Company”), on Form 10-Q for the period ended June 30, 2018, as filed with the U.S. Securities and Exchange Commission on the date hereof, I, Jeremy Frommer, Chief Executive Officer of the Company, certify to the best of my knowledge, pursuant to 18 U.S.C. Sec. 1350, as adopted pursuant to Sec. 906 of the Sarbanes-Oxley Act of 2002, that:

(1) Such Quarterly Report on Form 10-Q for the period ended June 30, 2018, fully complies with the requirements of section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

(2) The information contained in such Quarterly Report on Form 10-Q for the period ended June 30, 2018, fairly presents, in all material respects, the financial condition and results of operations of the Company.

Date: August 20, 2018	By:	/s/ Jeremy Frommer
		Jeremy Frommer
		Chief Executive Officer

EX-32.2

 Exhibit 32.2

CERTIFICATION PURSUANT TO

18 U.S.C. SECTION 1350,

AS ADOPTED PURSUANT TO SECTION 906 OF

THE SARBANES-OXLEY ACT OF 2002

In connection with this Quarterly Report of Jerrick Media Holdings, Inc. (the “Company”), on Form 10-Q for the period ended June 30, 2018, as filed with the U.S. Securities and Exchange Commission on the date hereof, I, Jeremy Frommer, Chief Financial Officer of the Company, certify to the best of my knowledge, pursuant to 18 U.S.C. Sec. 1350, as adopted pursuant to Sec. 906 of the Sarbanes-Oxley Act of 2002, that:

(1) Such Quarterly Report on Form 10-Q for the period ended June 30, 2018, fully complies with the requirements of section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

(2) The information contained in such Quarterly Report on Form 10-Q for the period ended June 30, 2018, fairly presents, in all material respects, the financial condition and results of operations of the Company.

Date: August 20, 2018	By:	/s/ Jeremy Frommer
		Jeremy Frommer
		Chief Financial Officer

XML

Document and Entity Information - shares	6 Months Ended
	Jun. 30, 2018	Aug. 20, 2018
Document and Entity Information [Abstract]
Entity Registrant Name	Jerrick Media Holdings, Inc.
Entity Central Index Key	0001357671
Trading Symbol	JMDA
Amendment Flag	false
Current Fiscal Year End Date	--12-31
Document Type	10-Q
Document Period End Date	Jun. 30, 2018
Document Fiscal Period Focus	Q2
Document Fiscal Year Focus	2018
Entity Filer Category	Smaller Reporting Company
Entity Common Stock, Shares Outstanding		40,524,432

XML

Condensed Consolidated Balance Sheet (Unaudited) - USD ($)	Jun. 30, 2018	Dec. 31, 2017
Current Assets
Cash	$ 22,422	$ 111,051
Prepaid expenses	86,274
Accounts receivable	9,170	1,325
Total Current Assets	117,866	112,376
Property and equipment, net	52,063	48,056
Security deposit	16,836	17,000
Total Assets	186,765	177,432
Current Liabilities
Accounts payable and accrued liabilities	2,094,658	1,462,106
Demand loan	60,366	10,366
Convertible Notes - related party, net of debt discount	30,916
Current portion of Convertible Notes, net of debt discount	59,500	96,500
Current portion of capital lease payable	4,732	4,732
Note payable - related party, net of debt discount	1,305,907	1,249,000
Note payable, net of debt discount and issuance costs	791,467	689,500
Line of credit - related party	130,000	130,000
Line of credit		44,996
Current portion of deferred rent	1,800
Total Current Liabilities	4,479,346	3,687,200
Non-current Liabilities:
Deferred rent	7,757
Current portion of Convertible Notes - related party, net of debt discount	1,571,792	1,345,246
Convertible Notes, net of debt discount and issuance costs	4,042,808	2,512,293
Total Non-current Liabilities	5,622,357	3,857,539
Total Liabilities	10,101,703	7,544,739
Commitments and contingencies
Stockholders' Deficit
Common stock par value $0.001: 300,000,000 shares authorized; 40,524,432 and 39,520,682 issued and outstanding as of June 30, 2018 and December 31,2017 respectively	40,525	39,521
Additional paid in capital	16,343,480	14,387,247
Accumulated deficit	(26,279,975)	(21,775,107)
Less: Treasury stock, 220,000 and 220,000 shares, respectively	(19,007)	(19,007)
Total Stockholders' Deficit	(9,914,938)	(7,367,307)
Total Liabilities and Stockholders' Deficit	186,765	177,432
Series A Preferred stock
Stockholders' Deficit
Preferred stock value	31	31
Series B Preferred stock
Stockholders' Deficit
Preferred stock value	8	8
Series D Preferred stock
Stockholders' Deficit
Preferred stock value

XML

Condensed Consolidated Balance Sheet (Unaudited) (Parenthetical) - $ / shares	Jun. 30, 2018	Dec. 31, 2017
Common stock, par value	$ 0.001	$ 0.001
Common stock, shares authorized	300,000,000	300,000,000
Common stock, shares issued	40,524,432	39,520,682
Common stock, shares outstanding	40,524,432	39,520,682
Treasury stock, shares	220,000	220,000
Series A Preferred stock
Preferred stock, par value	$ 0.001	$ 0.001
Preferred stock, shares issued	31,581	31,581
Preferred stock, shares outstanding	31,581	31,581
Series B Preferred stock
Preferred stock, par value	$ 0.001	$ 0.001
Preferred stock, shares issued	8,063	8,063
Preferred stock, shares outstanding	8,063	8,063
Series D Preferred stock
Preferred stock, par value	$ 0.001	$ 0.001
Preferred stock, shares issued	0	0
Preferred stock, shares outstanding	0	0

XML

Condensed Consolidated Statements of Operations (Unaudited) - USD ($)	3 Months Ended		6 Months Ended
	Jun. 30, 2018	Jun. 30, 2017	Jun. 30, 2018	Jun. 30, 2017
Income Statement [Abstract]
Net revenue	$ 24,023	$ 52,259	$ 40,272	$ 94,101
Operating expenses
Compensation	451,041	709,298	1,102,829	1,255,408
Consulting fees	350,804	37,565	446,603	177,570
General and administrative	787,881	253,015	1,380,120	636,753
Total operating expenses	1,589,726	999,878	2,929,552	2,069,731
Loss from operations	(1,565,703)	(947,619)	(2,889,280)	(1,975,630)
Other income (expenses)
Interest expense	(341,071)	(87,318)	(609,196)	(144,705)
Accretion of debt discount and issuance cost	(415,045)	(431,720)	(589,933)	(724,900)
Settlement of vendor liabilities			1,875	(110,674)
Loss on extinguishment of debt	(89,419)		(431,786)
Gain on settlement of debt			13,452
Other income (expenses), net	(845,535)	(519,038)	(1,615,588)	(980,279)
Loss before income tax provision	(2,411,238)	(1,466,657)	(4,504,868)	(2,955,909)
Income tax provision
Net loss	(2,411,238)	(1,466,657)	(4,504,868)	(2,955,909)
Deemed dividend	65,823	67,888	129,858	131,867
Net loss attributable to common shareholders	$ (2,477,061)	$ (1,534,545)	$ (4,634,726)	$ (3,087,776)
Per-share data
Basic and diluted loss per share	$ (0.06)	$ (0.04)	$ (0.12)	$ (0.08)
Weighted average number of common shares outstanding	40,524,432	38,014,509	40,230,654	37,247,125

XML

Condensed Consolidated Statements of Cash Flows (Unaudited) - USD ($)	6 Months Ended
	Jun. 30, 2018	Jun. 30, 2017
CASH FLOWS FROM OPERATING ACTIVITIES:
Net loss	$ (4,504,868)	$ (2,955,909)
Adjustments to reconcile net loss to net cash used in operating activities:
Depreciation	21,439	18,704
Accretion of debt discount and issuance cost	589,933	128,900
Share-based compensation	285,821	596,000
Loss on settlement of vendor liabilities	(1,875)	627,619
Gain on settlement of debt	(13,452)	110,674
Loss on extinguishment of debt	431,786
Changes in operating assets and liabilities:
Prepaid expenses	(18,864)	10,000
Inventory
Accounts receivable	(7,845)
Security deposit	164
Accounts payable and accrued expenses	900,595	77,642
Deferred rent	707
Net Cash Used In Operating Activities	(2,316,459)	(1,386,370)
CASH FLOWS FROM INVESTING ACTIVITIES:
Cash paid for property and equipment	(16,446)
Net Cash Used In Investing Activities	(16,446)
CASH FLOWS FROM FINANCING ACTIVITIES:
Net proceeds from issuance of notes	658,500	1,041,585
Repayment of notes	(85,675)
Proceeds from issuance of demand loan	50,000
Proceeds from issuance of convertible note	1,525,154	71,500
Repayment of convertible notes	(76,798)
Proceeds from issuance of convertible notes - related party	299,852	50,000
Proceeds from issuance of note payable - related party	245,000	185,000
Repayment of note payable - related party	(160,000)	(120,000)
Proceeds from issuance of line of credit - related party		130,000
Repayment of line of credit	(44,996)	(41,706)
Cash paid for debt issuance costs	(166,761)	(99,226)
Net Cash Provided By Financing Activities	2,244,276	1,217,153
Net Change in Cash	(88,629)	(169,217)
Cash - Beginning of Year	111,051	174,494
Cash - End of Year	22,422	5,277
Cash Paid During the Year for:
Income taxes
Interest	64,892	3,534
SUPPLEMENTARY DISCLOSURE OF NON-CASH INVESTING AND FINANCING ACTIVITIES:
Settlement of vendor liabilities	3,750	353,732
Beneficial conversion feature on convertible notes	38,413
Deemed dividends	127,795	131,867
Warrants issued with debt	1,085,221	620,714
Issuance of common stock for prepaid services	116,300
Conversion of note payable and interest into convertible notes	341,442
Warrants issued with amendment to notes payable	$ 135,596

XML

Organization and Operations

6 Months Ended

Jun. 30, 2018

Organization and Operations [Abstract]

Organization and Operations

Note 1 – Organization and Operations

Jerrick Media Holdings, Inc. (“we,” “us,” the “Company,” or “Jerrick Media” or “Jerrick”) (formerly Great Plains Holdings, Inc. or “GTPH”) was incorporated under the laws of the state of Nevada on December 30, 1999 under the name LILM, Inc. The Company changed its name on December 3, 2013 to Great Plains Holdings, Inc. as part of its plan to diversify its business through the acquisition and operation of commercial real estate, including, but not limited to, self-storage facilities, apartment buildings, 55+ senior manufactured home communities, and other income producing properties. Historically, the Company has principally engaged in the manufacture and marketing of the LiL Marc, a plastic boys’ toilet-training device, which we discontinued as of December 31, 2014.

On February 5, 2016 (the “Closing Date”), GTPH, GPH Merger Sub, Inc., a Nevada corporation and wholly-owned subsidiary of GTPH (“Merger Sub”), and Jerrick Ventures, Inc., a privately-held Nevada corporation headquartered in New Jersey (“Jerrick”), entered into an Agreement and Plan of Merger (the “Agreement”) pursuant to which the Merger Sub was merged with and into Jerrick, with Jerrick surviving as a wholly-owned subsidiary of GTPH (the “Merger”). GTPH acquired, through a reverse triangular merger, all of the outstanding capital stock of Jerrick in exchange for issuing Jerrick’s shareholders (the “Jerrick Shareholders”), pro-rata, a total of 28,500,000 shares of GTPH’s common stock. GTPH assumed 33,415 shares of Jerrick’s Series A Convertible Preferred Stock (the “Jerrick Series A Preferred”) and 8,064 shares of Series B Convertible Preferred Stock (the “Jerrick Series B Preferred”).

In connection with the Merger, on the Closing Date, GTPH and Kent Campbell entered into a Spin-Off Agreement (the “Spin-Off Agreement”), pursuant to which Mr. Campbell purchased from GTPH (i) all of GTPH’s interest in Ashland Holdings, LLC, a Florida limited liability company, and (ii) all of GTPH’s interest in Lil Marc, Inc., a Utah corporation, in exchange for the cancellation of 781,818 shares of GTPH’s Common Stock held by Mr. Campbell. In addition, Mr. Campbell assumed all debts, obligations and liabilities of GTPH, including any existing prior to the Merger, pursuant to the terms and conditions of the Spin-Off Agreement.

Upon closing of the Merger on February 5, 2016, the Company changed its business plan to that of Jerrick Media.

Effective February 28, 2016, GTPH entered into an Agreement and Plan of Merger (the “Statutory Merger Agreement”) with Jerrick, pursuant to which GTPH became the parent company of Jerrick Ventures, LLC, a wholly-owned operating subsidiary of Jerrick (the “Statutory Merger”) and GTPH changed its name to Jerrick Media Holdings, Inc. to better reflect its new business strategy.

Jerrick Media is a technology company focused on the development of digital communities, marketing branded digital content, and e-commerce opportunities. Jerrick’s content distribution platform, Vocal, delivers a robust long-form, digital publishing platform organized into highly engaged niche-communities capable of hosting all forms of rich media content. Through Jerrick’s proprietary algorithm dynamics, Vocal enhances the visibility of content and maximizes viewership, providing advertisers access to target markets that most closely match their interests.

XML

Significant and Critical Accounting Policies and Practices

6 Months Ended

Jun. 30, 2018

Significant and Critical Accounting Policies and Practices [Abstract]

Significant and Critical Accounting Policies and Practices

Note 2 – Significant and Critical Accounting Policies and Practices

Management of the Company is responsible for the selection and use of appropriate accounting policies and the appropriateness of accounting policies and their application. Critical accounting policies and practices are those that are both most important to the portrayal of the Company’s financial condition and results and require management’s most difficult, subjective, or complex judgments, often as a result of the need to make estimates about the effects of matters that are inherently uncertain. The Company’s significant and critical accounting policies and practices are disclosed below as required by generally accepted accounting principles.

Basis of Presentation - Unaudited Interim Financial Information

The accompanying unaudited interim condensed consolidated financial statements and related notes have been prepared in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”) for interim financial information, and in accordance with the rules and regulations of the United States Securities and Exchange Commission (the “SEC”) with respect to Form 10-Q and Article 10 of Regulation S-X. Accordingly, they do not include all of the information and footnotes required by U.S. GAAP for complete financial statements. The unaudited interim condensed consolidated financial statements furnished reflect all adjustments (consisting of normal recurring adjustments) which are, in the opinion of management, necessary for a fair statement of the results for the interim periods presented. Interim results are not necessarily indicative of the results for the full year. These unaudited interim condensed consolidated financial statements should be read in conjunction with the audited consolidated financial statements and notes thereto contained in the Company’s annual report on Form 10-K for the year ended December 31, 2017.

Use of Estimates and Assumptions and Critical Accounting Estimates and Assumptions

The preparation of financial statements in conformity with US GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the dates of the financial statements and the reported amounts of revenues and expenses during the reporting periods.

Critical accounting estimates are estimates for which (a) the nature of the estimate is material due to the levels of subjectivity and judgment necessary to account for highly uncertain matters or the susceptibility of such matters to change and (b) the impact of the estimate on financial condition or operating performance is material. The Company’s critical accounting estimates and assumptions affecting the financial statements were:

(i)	Assumption as a going concern: Management assumes that the Company will continue as a going concern, which contemplates continuity of operations, realization of assets, and liquidation of liabilities in the normal course of business.
(ii)	Fair value of long-lived assets: Fair value is generally determined using the asset’s expected future discounted cash flows or market value, if readily determinable. If long-lived assets are determined to be recoverable, but the newly determined remaining estimated useful lives are shorter than originally estimated, the net book values of the long-lived assets are depreciated over the newly determined remaining estimated useful lives. The Company considers the following to be some examples of important indicators that may trigger an impairment review: (i) significant under-performance or losses of assets relative to expected historical or projected future operating results; (ii) significant changes in the manner or use of assets or in the Company’s overall strategy with respect to the manner or use of the acquired assets or changes in the Company’s overall business strategy; (iii) significant negative industry or economic trends; (iv) increased competitive pressures; (v) a significant decline in the Company’s stock price for a sustained period of time; and (vi) regulatory changes. The Company evaluates acquired assets for potential impairment indicators at least annually and more frequently upon the occurrence of such events.
(iii)	Valuation allowance for deferred tax assets: Management assumes that the realization of the Company’s net deferred tax assets resulting from its net operating loss (“NOL”) carry–forwards for Federal income tax purposes that may be offset against future taxable income was not considered more likely than not and accordingly, the potential tax benefits of the net loss carry-forwards are offset by a full valuation allowance. Management made this assumption based on (a) the Company has incurred recurring losses, (b) general economic conditions, and (c) its ability to raise additional funds to support its daily operations by way of a public or private offering, among other factors.
(iv)	Estimates and assumptions used in valuation of equity instruments: Management estimates expected term of share options and similar instruments, expected volatility of the Company’s common shares and the method used to estimate it, expected annual rate of quarterly dividends, and risk free rate(s) to value share options and similar instruments.

These significant accounting estimates or assumptions bear the risk of change due to the fact that there are uncertainties attached to these estimates or assumptions, and certain estimates or assumptions are difficult to measure or value.

Management bases its estimates on historical experience and on various assumptions that are believed to be reasonable in relation to the financial statements taken as a whole under the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities that are not readily apparent from other sources.

Management regularly evaluates the key factors and assumptions used to develop the estimates utilizing currently available information, changes in facts and circumstances, historical experience and reasonable assumptions. After such evaluations, if deemed appropriate, those estimates are adjusted accordingly.

Actual results could differ from those estimates.

Principles of consolidation

The Company consolidates all majority-owned subsidiaries, if any, in which the parent’s power to control exists.

As of June 30, 2018, the Company’s consolidated subsidiaries and/or entities are as follows:

Name of combined affiliate	State or other jurisdiction of incorporation or organization	Company interest
Jerrick Ventures LLC	The State of Delaware		100%
Jerrick Australia Pty Ltd	Australia		100%

All inter-company balances and transactions have been eliminated.

Jerrick Australia Pty Ltd does not have any operations.

Fair Value of Financial Instruments

The Company follows paragraph 825-10-50-10 of the FASB Accounting Standards Codification for disclosures about fair value of its financial instruments and paragraph 820-10-35-37 of the FASB Accounting Standards Codification (“Paragraph 820-10-35-37”) to measure the fair value of its financial instruments. Paragraph 820-10-35-37 establishes a framework for measuring fair value in U.S. GAAP, and expands disclosures about fair value measurements. To increase consistency and comparability in fair value measurements and related disclosures, Paragraph 820-10-35-37 establishes a fair value hierarchy which prioritizes the inputs to valuation techniques used to measure fair value into three (3) broad levels. The fair value hierarchy gives the highest priority to quoted prices (unadjusted) in active markets for identical assets or liabilities and the lowest priority to unobservable inputs. The three (3) levels of fair value hierarchy defined by Paragraph 820-10-35-37 are described below:

Level 1	Quoted market prices available in active markets for identical assets or liabilities as of the reporting date.
Level 2	Pricing inputs other than quoted prices in active markets included in Level 1, which are either directly or indirectly observable as of the reporting date.
Level 3	Pricing inputs that are generally observable inputs and not corroborated by market data.

Financial assets are considered Level 3 when their fair values are determined using pricing models, discounted cash flow methodologies or similar techniques and at least one significant model assumption or input is unobservable.

The fair value hierarchy gives the highest priority to quoted prices (unadjusted) in active markets for identical assets or liabilities and the lowest priority to unobservable inputs. If the inputs used to measure the financial assets and liabilities fall within more than one level described above, the categorization is based on the lowest level input that is significant to the fair value measurement of the instrument.

The carrying amount of the Company’s financial assets and liabilities, such as cash, prepaid expenses, accounts payable and accrued liabilities and accrued liquidating damages approximate their fair value because of the short maturity of those instruments. Transactions involving related parties cannot be presumed to be carried out on an arm’s-length basis, as the requisite conditions of competitive, free-market dealings may not exist. Representations about transactions with related parties, if made, shall not imply that the related party transactions were consummated on terms equivalent to those that prevail in arm’s-length transactions unless such representations can be substantiated.

Cash Equivalents

The Company considers all highly liquid investments with a maturity of three months or less when purchased to be cash equivalents.

The Company minimizes its credit risk associated with cash by periodically evaluating the credit quality of its primary financial institution. The balance at times may exceed federally insured limits.

Property and Equipment

Property and equipment are recorded at cost. Expenditures for major additions and betterments are capitalized. Maintenance and repairs are charged to operations as incurred. Depreciation is computed by the straight-line method (after taking into account their respective estimated residual values) over the estimated useful lives of the respective assets as follows:

	Estimated Useful Life (Years)
Computer equipment and software		3
Furniture and fixture		5
Leasehold improvement		5

Upon sale or retirement of property and equipment, the related cost and accumulated depreciation are removed from the accounts and any gain or loss is reflected in the consolidated statements of operations.

Commitments and Contingencies

The Company follows subtopic 450-20 of the FASB Accounting Standards Codification to report accounting for contingencies. Certain conditions may exist as of the date the condensed consolidated financial statements are issued, which may result in a loss to the Company, but which will only be resolved when one or more future events occur or fail to occur. The Company assesses such contingent liabilities, and such assessment inherently involves an exercise of judgment. In assessing loss contingencies related to legal proceedings that are pending against the Company or un-asserted claims that may result in such proceedings, the Company evaluates the perceived merits of any legal proceedings or un-asserted claims as well as the perceived merits of the amount of relief sought or expected to be sought therein.

If the assessment of a contingency indicates that it is probable that a material loss has been incurred and the amount of the liability can be estimated, then the estimated liability would be accrued in the Company’s consolidated financial statements. If the assessment indicates that a potential material loss contingency is not probable but is reasonably possible, or is probable but cannot be estimated, then the nature of the contingent liability, and an estimate of the range of possible losses, if determinable and material, would be disclosed.

Loss contingencies considered remote are generally not disclosed unless they involve guarantees, in which case the guarantees would be disclosed.

Derivative Liability

The Company adopted Section 815-40-15 of the FASB Accounting Standards Codification (“Section 815-40-15”) to determine whether an instrument (or an embedded feature) is indexed to the Company’s own stock. Section 815-40-15 provides that an entity should use a two-step approach to evaluate whether an equity-linked financial instrument (or embedded feature) is indexed to its own stock, including evaluating the instrument’s contingent exercise and settlement provisions.  The Company changed its method of accounting for the debt and warrants through the early adoption of ASU 2017-11 during the year ended December 31, 2017 on a retrospective basis.

Revenue Recognition

The Company adopted ASC 606 effective January 1, 2018 using the modified retrospective method which would require a cumulative effect adjustment for initially applying the new revenue standard as an adjustment to the opening balance of retained earnings and the comparative information would not require to be restated and continue to be reported under the accounting standards in effect for those periods.

Based on the Company’s analysis the Company did not identify a cumulative effect adjustment for initially applying the new revenue standards. During the six months ended June 30, 2018 the Company recorded revenue from the following sources: products at auction, sponsored content and affiliate sites.

The adoption of ASC 606 represents a change in accounting principle that will more closely align revenue recognition with the delivery of the Company's services and will provide financial statement readers with enhanced disclosures. In accordance with ASC 606, revenue is recognized when a customer obtains control of promised services. The amount of revenue recognized reflects the consideration to which the Company expects to be entitled to receive in exchange for these services. To achieve this core principle, the Company applies the following five steps:

1) Identify the contract with a customer

A contract with a customer exists when (i) the Company enters into an enforceable contract with a customer that defines each party’s rights regarding the services to be transferred and identifies the payment terms related to these services, (ii) the contract has commercial substance and, (iii) the Company determines that collection of substantially all consideration for services that are transferred is probable based on the customer’s intent and ability to pay the promised consideration. The Company applies judgment in determining the customer’s ability and intention to pay, which is based on a variety of factors including the customer’s historical payment experience or, in the case of a new customer, published credit and financial information pertaining to the customer.

2) Identify the performance obligations in the contract

Performance obligations promised in a contract are identified based on the services that will be transferred to the customer that are both capable of being distinct, whereby the customer can benefit from the service either on its own or together with other resources that are readily available from third parties or from the Company, and are distinct in the context of the contract, whereby the transfer of the services is separately identifiable from other promises in the contract. To the extent a contract includes multiple promised services, the Company must apply judgment to determine whether promised services are capable of being distinct and distinct in the context of the contract. If these criteria are not met the promised services are accounted for as a combined performance obligation.

3) Determine the transaction price

The transaction price is determined based on the consideration to which the Company will be entitled in exchange for transferring services to the customer. To the extent the transaction price includes variable consideration, the Company estimates the amount of variable consideration that should be included in the transaction price utilizing either the expected value method or the most likely amount method depending on the nature of the variable consideration. Variable consideration is included in the transaction price if, in the Company’s judgment, it is probable that a significant future reversal of cumulative revenue under the contract will not occur. None of the Company's contracts as of June 30, 2018 contained a significant financing component. Determining the transaction price requires significant judgment, which is discussed by revenue category in further detail below.

4) Allocate the transaction price to performance obligations in the contract

If the contract contains a single performance obligation, the entire transaction price is allocated to the single performance obligation. However, if a series of distinct services that are substantially the same qualifies as a single performance obligation in a contract with variable consideration, the Company must determine if the variable consideration is attributable to the entire contract or to a specific part of the contract. For example, a bonus or penalty may be associated with one or more, but not all, distinct services promised in a series of distinct services that forms part of a single performance obligation. Contracts that contain multiple performance obligations require an allocation of the transaction price to each performance obligation based on a relative standalone selling price basis unless the transaction price is variable and meets the criteria to be allocated entirely to a performance obligation or to a distinct service that forms part of a single performance obligation. The Company determines standalone selling price based on the price at which the performance obligation is sold separately. If the standalone selling price is not observable through past transactions, the Company estimates the standalone selling price taking into account available information such as market conditions and internally approved pricing guidelines related to the performance obligations.

5) Recognize revenue when or as the Company satisfies a performance obligation

The Company satisfies performance obligations either over time or at a point in time. Revenue is recognized at the time the related performance obligation is satisfied by transferring a promised service to a customer.

Product revenue

Revenue from multiple-element arrangements is allocated among separate elements based on their estimated sales prices, provided the elements have value on a stand-alone basis.

Stock-Based Compensation

The Company recognizes compensation expense for all equity–based payments granted to employees in accordance with ASC 718 “Compensation – Stock Compensation”. Under fair value recognition provisions, the Company recognizes equity–based compensation net of an estimated forfeiture rate and recognizes compensation cost only for those shares expected to vest over the requisite service period of the award. 

Restricted stock awards are granted at the discretion of the Company. These awards are restricted as to the transfer of ownership and generally vest over the requisite service periods, typically over a five-year period (vesting on a straight–line basis). The fair value of a stock award is equal to the fair market value of a share of Company stock on the grant date. 

The fair value of an option award is estimated on the date of grant using the Black–Scholes option valuation model. The Black–Scholes option valuation model requires the development of assumptions that are inputs into the model. These assumptions are the value of the underlying share, the expected stock volatility, the risk–free interest rate, the expected life of the option, the dividend yield on the underlying stock and the expected forfeiture rate. Expected volatility is benchmarked against similar companies in a similar industry over the expected option life and other appropriate factors. Risk–free interest rates are calculated based on continuously compounded risk–free rates for the appropriate term. The dividend yield is assumed to be zero as the Company has never paid or declared any cash dividends on its Common stock and does not intend to pay dividends on its Common stock in the foreseeable future. The expected forfeiture rate is estimated based on management’s best estimate.  

Determining the appropriate fair value model and calculating the fair value of equity–based payment awards requires the input of the subjective assumptions described above. The assumptions used in calculating the fair value of equity–based payment awards represent management’s best estimates, which involve inherent uncertainties and the application of management’s judgment. As a result, if factors change and the Company uses different assumptions, our equity–based compensation could be materially different in the future. In addition, the Company is required to estimate the expected forfeiture rate and recognize expense only for those shares expected to vest. If the Company’s actual forfeiture rate is materially different from its estimate, the equity–based compensation could be significantly different from what the Company has recorded in the current period.

The Company accounts for share–based payments granted to non–employees in accordance with ASC 505-40, “Equity Based Payments to Non–Employees”. The Company determines the fair value of the stock–based payment as either the fair value of the consideration received or the fair value of the equity instruments issued, whichever is more reliably measurable. If the fair value of the equity instruments issued is used, it is measured using the stock price and other measurement assumptions as of the earlier of either (1) the date at which a commitment for performance by the counterparty to earn the equity instruments is reached, or (2) the date at which the counterparty’s performance is complete. The fair value of the equity instruments is re-measured each reporting period over the requisite service period.

Income Taxes

Income taxes are provided in accordance with ASC No. 740, “Accounting for Income Taxes”. A deferred tax asset or liability is recorded for all temporary differences between financial and tax reporting and net operating loss carryforwards. Deferred tax expense (benefit) results from the net change during the period of deferred tax assets and liabilities.

Deferred tax assets are reduced by a valuation allowance when, in the opinion of management, it is more likely than not that some portion or all of the deferred tax assets will not be realized. Deferred tax assets and liabilities are adjusted for the effects of changes in tax laws and rates on the date of enactment. 

Management makes judgments as to the interpretation of the tax laws that might be challenged upon an audit and cause changes to previous estimates of tax liability. In addition, the Company operates within multiple taxing jurisdictions and is subject to audit in these jurisdictions. In management’s opinion, adequate provisions for income taxes have been made for all years. If actual taxable income by tax jurisdiction varies from estimates, additional allowances or reversals of reserves may be necessary. 

Loss Per Share

Basic net loss per common share is computed by dividing net loss attributable to common stockholders by the weighted-average number of common shares outstanding during the period. Diluted net loss per common share is determined using the weighted-average number of common shares outstanding during the period, adjusted for the dilutive effect of common stock equivalents. In periods when losses are reported, which is the case for the six months ended June 30, 2018 and 2017 presented in these consolidated financial statements, the weighted-average number of common shares outstanding excludes common stock equivalents because their inclusion would be anti-dilutive.

The Company had the following common stock equivalents at June 30, 2018 and 2017:

	June 30, 2018		June 30, 2017
Series A Preferred stock		23,135,935		21,654,614
Series B Preferred stock		4,697,906		4,431,987
Options		17,649,990		17,549,990
Warrants		62,016,795		22,805,981
Convertible notes - related party		10,027,507		250,000
Convertible notes		28,015,838		2,929,127
Totals		145,543,971		69,621,699

Reclassifications

Interest expense has been allocated to accretion of debt discount and issuance cost to conform to current period presentation.

Recently Adopted Accounting Guidance

In November 2016, the FASB issued ASU 2016-18, “Statement of Cash Flows (Topic 230)”, requiring that the statement of cash flows explain the change in the total cash, cash equivalents, and amounts generally described as restricted cash or restricted cash equivalents. This guidance is effective for fiscal years, and interim reporting periods therein, beginning after December 15, 2017 with early adoption permitted. The provisions of this guidance are to be applied using a retrospective approach which requires application of the guidance for all periods presented. The Company has adopted the methodologies prescribed by ASU 2016-18, the adoption of ASU 2016-18 did not have a material effect on its financial position or results of operations. 

In May 2017, the FASB issued ASU 2017-09, “Compensation—Stock Compensation (Topic 718): Scope of Modification Accounting,” which provides guidance about which changes to the terms or conditions of a share-based payment award require an entity to apply modification accounting in Topic 718. This standard is required to be adopted in the first quarter of 2018. The Company has adopted the methodologies prescribed by ASU 2017-09, the adoption of ASU 2017-09 did not have a material effect on its financial position or results of operations. 

In July 2017, the FASB issued ASU 2017-11, “Earnings Per Share (Topic 260), Distinguishing Liabilities from Equity (Topic 480) and Derivatives and Hedging (Topic 815): I. Accounting for Certain Financial Instruments with Down Round Features; II. Replacement of the Indefinite Deferral for Mandatorily Redeemable Financial Instruments of Certain Nonpublic Entities and Certain Mandatorily Redeemable Noncontrolling Interests with a Scope Exception”. Part I of this update addresses the complexity of accounting for certain financial instruments with down round features. Down round features are features of certain equity-linked instruments (or embedded features) that result in the strike price being reduced on the basis of the pricing of future equity offerings. Current accounting guidance creates cost and complexity for entities that issue financial instruments (such as warrants and convertible instruments) with down round features that require fair value measurement of the entire instrument or conversion option. Part II of this update addresses the difficulty of navigating Topic 480, Distinguishing Liabilities from Equity, because of the existence of extensive pending content in the FASB Accounting Standards Codification. This pending content is the result of the indefinite deferral of accounting requirements about mandatorily redeemable financial instruments of certain nonpublic entities and certain mandatorily redeemable noncontrolling interests. The amendments in Part II of this update do not have an accounting effect. This ASU is effective for fiscal years, and interim periods within those years, beginning after December 15, 2018. The Company early adopted the ASU 2017-11 in the year ending December 31, 2017. 

Adoption of ASU 2017-11

As noted above, in connection with the securities purchase agreement and debt transactions during the year ended December 31, 2017, the Company issued warrants and convertible notes, to purchase common stock with an exercise price of $0.20 and a five-year term. Upon issuance of the warrants and convertible notes, the Company evaluated the note agreement to determine if the agreement contained any embedded components that would qualify the agreement as a derivative. The Company identified certain put features embedded in the warrants and convertible notes that potentially could result in a net cash settlement in the event of a fundamental transaction, requiring the Company to classify the warrants and convertible notes as a derivative liability. The Company changed its method of accounting for the convertible notes and warrants through the early adoption of ASU 2017-11 during the three months ended December 31, 2017 on a retrospective basis. Accordingly, the Company recorded the warrant derivative and conversion option derivative liabilities to additional paid in capital upon issuance.

Tabular summaries of the revisions and the corresponding effects on the statement of earnings for the six months ended June 30, 2017 are presented below:

Consolidated Statement of Operations Six Months Ended June 30, 2017
	Previously  Reported			Revisions			Revised  Reported
Accretion of debt discount and issuance cost	$	(951,484	)	$	226,584		$	(724,900	)
Derivative expense		(254,470	)		254,470			-
Change in fair value of derivative liabilities		584,011			(584,011	)		-
Net loss	$	(2,852,952	)	$	102,957		$	(2,955,909	)
Net loss per ordinary share:
Basic and diluted loss per share	$	(0.08	)	$	(0.00	)	$	(0.08	)

Recent Accounting Guidance Not Yet Adopted

In February 2016, the FASB issued ASU 2016-02, “Leases (Topic 842).” Under ASU 2016-02, lessees will be required to recognize, for all leases of 12 months or more, a liability to make lease payments and a right-of-use asset representing the right to use the underlying asset for the lease term. Additionally, the guidance requires improved disclosures to help users of financial statements better understand the nature of an entity’s leasing activities. This ASU is effective for public reporting companies for interim and annual periods beginning after December 15, 2018, with early adoption permitted, and must be adopted using a modified retrospective approach. The Company is in the process of evaluating the effect of the new guidance on its condensed consolidated financial statements and disclosures.

In October 2016, the FASB issued ASU 2016-16, “Income Taxes (Topic 740): Intra-Entity Transfers of Assets Other than Inventory”, which eliminates the exception that prohibits the recognition of current and deferred income tax effects for intra-entity transfers of assets other than inventory until the asset has been sold to an outside party. The updated guidance is effective for annual periods beginning after December 15, 2019, including interim periods within those fiscal years. Early adoption of the update is permitted. The Company is currently evaluating the impact of the new standard.

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

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Going Concern

6 Months Ended

Jun. 30, 2018

Going Concern [Abstract]

Going Concern

Note 3 – Going Concern

The Company’s condensed consolidated financial statements have been prepared assuming that it will continue as a going concern, which contemplates continuity of operations, realization of assets, and liquidation of liabilities in the normal course of business. 

As reflected in the condensed consolidated financial statements, the Company had an accumulated deficit at June 30, 2018, a net loss and net cash used in operating activities for the reporting period then ended. These factors raise substantial doubt about the Company’s ability to continue as a going concern for a period of one year from the issuance of these financial statements.

The Company is attempting to further implement its business plan and generate sufficient revenues; however, its cash position may not be sufficient to support its daily operations. While the Company believes in the viability of its strategy to further implement its business plan and generate sufficient revenues and in its ability to raise additional funds by way of a public or private offering of its debt or equity securities, there can be no assurance to that effect. The ability of the Company to continue as a going concern is dependent upon its ability to further implement its business plan and generate sufficient revenues and its ability to raise additional funds by way of a public or private offering.

The condensed consolidated 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 the Company be unable to continue as a going concern. 

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Property and Equipment

6 Months Ended

Jun. 30, 2018

Property and Equipment [Abstract]

Property and Equipment

Note 4 – Property and Equipment

Property and equipment stated at cost, less accumulated depreciation and amortization, consisted of the following:

	June 30, 2018			December 31, 2017
Computer Equipment	$	234,315		$	234,315
Furniture and Fixtures		61,803			61,803
Leasehold Improvements		25,445			-
		321,563			296,118
Less: Accumulated Depreciation		(269,500	)		(248,062	)
	$	52,063		$	48,056

Depreciation expense was $10,423 and $9,404 for the three months ended June 30, 2018 and 2017, respectively. Depreciation expense was $21,440 and $18,704 for the six months ended June 30, 2018 and 2017, respectively.

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Line of Credit

6 Months Ended

Jun. 30, 2018

Line of Credit/Notes Payable/Convertible Note Payable [Abstract]

Line of Credit

Note 5 – Line of Credit

Line of credit as of June 30, 2018 and December 31, 2017 is as follows:

	Outstanding Balances as of
	June 30, 2018		December 31, 2017
Revolving Note		-		44,996
	$	-	$	44,996

On March 19, 2009, Astoria Surgical Supplies North LLC signed a revolving note (the “Revolving Note”) at PNC Bank (the “Bank”). The outstanding balance of this Revolving Note is limited to $200,000 and expired March 19, 2010. The outstanding balance accrues interest at a variable rate. The interest rate is subject to change based on changes in an independent index which is the highest Prime Rate as published in the “Money Rates” section of the Wall Street Journal. The Company had been in payment default since March 19, 2010; however, on May 3, 2017, the Company agreed to pay back the line of credit by December 1, 2017. On March 23, 2018 the Company sent the final payment for the Revolving note and the Revolving Note was fully satisfied.

The balance outstanding on the Revolving Note at June 30, 2018 and December 31, 2017 was $0 and $44,996, respectively.

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Notes Payable

6 Months Ended

Jun. 30, 2018

Line of Credit/Notes Payable/Convertible Note Payable [Abstract]

Notes Payable

Note 6 – Notes Payable

Notes payable as of June 30, 2018 and December 31, 2017 is as follows:

	Outstanding Principal as of										Warrants
	June 30, 2018			December 31, 2017			Interest Rate			Maturity Date	Quantity		Exercise Price
The February 2017 Offering	$	364,325		$	400,000			12	%	September 1, 2017		2,450,000	$	0.20
The June 2017 Loan Agreement		-			50,000			12	%	September 1, 2017		35,000		0.20
The First November 2017 Loan Agreement		-			100,000			15	%	January 12, 2018		-		-
The Second November 2017 Loan Agreement		-			50,000			15	%	January 13, 2018		-		-
The Third November 2017 Loan Agreement		-			100,000			15	%	January 13, 2018		-		-
May 2018 Offering		608,500			-			13	%	March 2019		1,825,500		-
		972,825			700,000
Less: Debt Discount		(180,950	)		(10,500	)
Less: Debt Issuance Costs		(408	)		-
	$	791,467		$	689,500

Private Placement Offerings:

The February 2017 Offering

From February 24, 2017 through March 17, 2017, the Company conducted multiple closings of a private placement offering (the “February 2017 Offering”) of the Company’s securities by entering into subscription agreements (the “Subscription Agreements”) with accredited investors (the “Accredited Investors”) for aggregate gross proceeds of $916,585 for which the Accredited Investors received $975,511 in principal value of secured promissory notes with an original issue discount of six percent (6%) (the “February 2017 Offering Notes”) and warrants to purchase the Company’s common stock (the “February 2017 Offering Warrants”). 

The February 2017 Offering Notes are convertible into shares of the Company’s common stock at the time of Company’s next round of financing (the “Subsequent Offering”) at a price equal to eighty-five percent (85%) of the price per share offered in the Subsequent Offering (the “Conversion Price”). The February 2017 Offering Warrants have a five-year term. Investors received the February 2017 Offering Warrants in the following amounts: (i) Investors purchasing $150,000 or more of the Offering received a February 2017 Offering Warrant equal to one hundred thirty percent (130%) of the dollar amount invested in the Offering; (ii) investors purchasing at least $100,000 but less than $150,000 of the February 2017 Offering received a February 2017 Offering Warrant equal to one hundred percent (100%) of the dollar amount invested in the Offering; and (iii) investors purchasing less than $100,000 of the Offering received to a February 2017 Offering Warrant equal to seventy percent (70%) of the dollar amount invested in the Offering. The Warrants entitle the holder to purchase shares of the Company’s common stock at $0.20 per share (the “Exercise Price”).

The Conversion Price and the Exercise Price are subject to adjustments for issuances of (i) the Company’s common stock, (ii) any equity linked instruments or (iii) securities convertible into the Company’s common stock, at a purchase price of less than the prevailing Conversion Price or Exercise Price. Such adjustments shall result in the Conversion Price or Exercise Price being reduced to such lower purchase price, as described in the February 2017 Offering Notes and the February 2017 Offering Warrants.

Pursuant to the Subscription Agreements, the February 2017 Offering Notes matured on September 1, 2017 (the “February 2017 Offering Maturity Date”). Prior to the February 2017 Offering Maturity Date, investors representing $575,511 in principal value converted their February 2017 Offering Notes into two year, 15% secured convertible promissory notes offered by the Company (the “August 2017 Convertible Note Offering”). The remaining investors representing an aggregate $400,000 in principal of the February 2017 Offering Notes agreed to forbear their right to declare an event of default until December 15, 2017 during which time they retain the right to convert their principal and any accrued but unpaid interest into the August 2017 Convertible Note Offering. In consideration of the forbearance for which the investors will receive a warrant to purchase up to fifteen percent (15%) of the shares of common stock underlying the warrant acquired with the purchase of the February 2017 Offering Notes at a purchase price of $0.20 per share, and the interest on their note would be increased to eighteen percent (18%) from September 1, 2017 through December 15, 2017 or the conversion date, whichever is sooner. During the six months ended June 30, 2018 the Company has repaid $26,500 in principal and $26,375 in interest.

The June 2017 Loan Agreement

On June 12, 2017, the Company entered into a loan agreement (the “June 2017 Loan Agreement”) with an individual (the “June 2017 Lender”), the June 2017 Lender issued the Company a promissory note of $50,000 (the “June 2017 Note”). Pursuant to the June 2017 Loan Agreement, the June 2017 Note bears interest at a rate of 10% per annum. As additional consideration for entering in the June 2017 Loan Agreement, the Company issued the June 2017 Lender a five-year warrant to purchase 35,000 shares of the Company’s common stock with an exercise price of $0.20 per share. The maturity date of the June 2017 Note was September 1, 2017 (the “June 2017 Maturity Date”) at which time all outstanding principal, accrued and unpaid interest and other amounts due under the June 2017 Note were due. During the six months ended June 30, 2018 the Company has repaid $50,000 in principal and the debtor has forgiven the interest of $4,424 this was recorded as a gain on forgiveness of debt.

The First November 2017 Loan Agreement

On November 28, 2017, the Company entered into a loan agreement (the “First November 2017 Loan Agreement”) with an individual (the “First November 2017 Lender”), the First November 2017 Lender issued the Company a promissory note of $100,000 (the “First November 2017 Note”). Pursuant to the First November 2017 Loan Agreement, the First November 2017 Note has interest of fifteen percent (15%), (i) five percent (5%) (i.e. $5,000) shall be payable in cash or convertible into shares of the Company’s restricted common stock at a rate of $0.20 per share, at the option of the Lender, at the Maturity Date; (ii) ten percent (10%) (i.e. $10,000) shall be paid in the form of the Company’s restricted common stock at a rate of $0.20 per share (equivalent to 50,000 shares of the Company’s common stock ). The maturity date of the First November 2017 Note was January 12, 2018 (the “First November 2017 Maturity Date”) at which time all outstanding principal, accrued and unpaid interest and other amounts due under the First November 2017 Note are due. On January 12, 2018, the First November 2017 Note and accrued but unpaid interest was converted into the Company’s August 2017 Convertible Note Offering.

The Second November 2017 Loan Agreement

On November 29, 2017, the Company entered into a loan agreement (the “Second November 2017 Loan Agreement”) with an individual (the “Second November 2017 Lender”), the Second November 2017 Lender issued the Company a promissory note of $50,000 (the “Second November 2017 Note”). Pursuant to the Second November 2017 Loan Agreement, the Second November 2017 Note has interest of fifteen percent (15%), (i) five percent (5%) (i.e. $2,500) shall be payable in cash or convertible into shares of the Company’s restricted common stock at a rate of $0.20 per share, at the option of the Lender, at the Maturity Date; (ii) ten percent (10%) (i.e. $5,000) shall be paid in the form of the Company’s restricted common stock at a rate of $0.20 per share (equivalent to 25,000 shares of the Company’s common stock ). The maturity date of the Second November 2017 Note was January 13, 2018 (the “Second November 2017 Maturity Date”) at which time all outstanding principal, accrued and unpaid interest and other amounts due under the Second November 2017 Note are due. On January 12, 2018, the Second November 2017 Note and accrued but unpaid interest was converted into the Company’s August 2017 Convertible Note Offering.

The Third November 2017 Loan Agreement

On November 29, 2017, the Company entered into a loan agreement (the “Third November 2017 Loan Agreement”) with an individual (the “Third November 2017 Lender”), the Third November 2017 Lender issued the Company a promissory note of $100,000 (the “Third November 2017 Note”). Pursuant to the Third November 2017 Loan Agreement, the Third November 2017 Note has interest of fifteen percent (15%), (i) five percent (5%) (i.e. $5,000) shall be payable in cash or convertible into shares of the Company’s restricted common stock at a rate of $0.20 per share, at the option of the Lender, at the Maturity Date; (ii) ten percent (10%) (i.e. $10,000) shall be paid in the form of the Company’s restricted common stock at a rate of $0.20 per share (equivalent to 50,000 shares of the Company’s common stock). The maturity date of the Third November 2017 Note was January 13, 2018 (the “Third November 2017 Maturity Date”) at which time all outstanding principal, accrued and unpaid interest and other amounts due under the Third November 2017 Note are due. On January 12, 2018, the Third November 2017 Note and accrued but unpaid interest was converted into the Company’s August 2017 Convertible Note Offering.

 On March 14, 2018, the Company entered into a loan agreement (the “March 2018 Loan Agreement”) with an individual (the “March 2018 Lender”), the March 2018 Lender issued the Company a promissory note of $50,000 (the “March 2018 Note”). Pursuant to the March 2018 Loan Agreement, the March 2018 Note bears interest at a rate of 12% per annum. As additional consideration for entering in the March 2018 Loan Agreement, the Company issued the March 2018 Lender a five-year warrant to purchase 100,000 shares of the Company’s common stock with an exercise price of $0.20 per share. The maturity date of the March 2018 Note was March 29, 2018 (the “March 2018 Maturity Date”) at which time all outstanding principal, accrued and unpaid interest and other amounts due under the March 2018 Note were due. On March 29, 2018, the March 2018 Note and accrued but unpaid interest was converted into the Company’s March 2018 Convertible Note Offering.

The May 2018 Offering

During the months of May and June 2018, the Company conducted multiple closings with accredited investors (the “May 2018 Offering”) of units of the Company’s securities by entering into subscription agreements with “accredited investors” (the “Investors”) for aggregate gross proceeds of $658,500.

The May 2018 Offering consisted of a maximum of $1,200,000 of units of the Company’s securities (each, a “Unit” and collectively, the “Units”), with each Unit consisting of (i) a 13% promissory note (each, a “ May 2018 Offering Note” and, together, the “May 2018 Offering Notes”), and (ii) a four-year warrant (“May 2018 Offering Warrant”) to purchase the number of shares of the Company’s common stock equal to three times the principal amount in dollars invested by such investor in each May 2018 Offering Note (the “May 2018 Warrant Shares”) at an exercise price of $0.20 per share (the “May Offering Warrant Exercise Price”), subject to adjustment upon the terms thereof. The May 2018 Offering Notes mature on the nine-month anniversary of their issuance dates.

The Company recorded a $215,032 debt discount relating to 1,825,500 May 2018 Offering Warrants issued to investors based on the relative fair value of each equity instrument on the dates of issuance. The debt discount is being accreted over the life of the note to accretion of debt discount and issuance cost.

The May Offering Warrant Exercise Price of the May 2018 Offering Warrants are subject to adjustment for issuances of the Company’s common stock or any equity linked instruments or securities convertible into the Company’s common stock at a purchase price of less than the prevailing May 2018 Offering Warrant Exercise Price. Such adjustment shall result in the May 2018 Offering Warrant Exercise Price being reduced to such lower purchase price, subject to carve-outs as described therein.

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Convertible Note Payable

6 Months Ended

Jun. 30, 2018

Line of Credit/Notes Payable/Convertible Note Payable [Abstract]

Convertible Note Payable

Note 7 – Convertible Note Payable

Convertible notes payable as of June 30, 2018 and December 31, 2017 is as follows: 

	Outstanding Principal as of													Warrants
	June 30, 2018			December 31,  2017			Interest Rate			Conversion Price			Maturity Date	Quantity		Exercise Price
The November 2016 Convertible Note Offering	$	25,000		$	25,000			10	%		0.30		November 1, 2017		400,000	$	0.30
The June 2017 Convertible Note Offering		-			71,500			12	%		Not Applicable		September 1, 2017		114,700		0.20
The August 2017 Convertible Note Offering		2,943,884			2,943,884			15	%		0.20	(*)	August – November 2019		14,716,419		0.20
The First December 2017 Note		100,000			100,000			15	%		0.20	(*)	December 21, 2019		500,000		0.20
The February 2018 Convertible Note Offering		1,015,674			-			15	%		0.20	(*)	January – February 2020		5,078,375		0.20
The January 2018 Note		68,761			-						0.20	(*)	January 12, 2020		343,806		0.20
The February 2018 Note		35,452			-			18	%		0.20	(*)	February 8, 2020		81,500		0.20
The March 2018 Convertible Note Offering		961,367			-			14	%		0.20	(*)	March – April 2020		4,806,833		0.20
		5,150,138			3,140,384
Less: Debt Discount		(828,627	)		(452,022	)
Less: Debt Issuance Costs		(219,204	)		(79,569	)
		4,102,307			2,608,793
Less: Current Debt		(59,499	)		(96,500	)
Total Long-Term Debt	$	4,042,808		$	2,512,293

(*) As subject to adjustment as further outlined in the notes

The November 2016 Convertible Note Offering

During the months of November and December 2016, the Company issued convertible notes to third party lenders totaling $400,000 (the “November 2016 Convertible Note Offering”). These notes accrue interest at a rate of 10% per annum and mature with interest and principal both due between November 1, 2017 through December 29, 2017. The notes and accrued interest are convertible at a conversion price as defined therein. In addition, in connection with the notes the Company issued five-year warrants to purchase an aggregate of 400,000 shares of Company common stock at a purchase price of $0.30 per share. The investors converted $375,000 of principal and $30,719 of interest into the August 2017 Convertible Note Offering. 

The June 2017 Convertible Note Offering

During the month of June 2017 the Company issued convertible notes to third party lenders totaling $71,500. The notes accrue interest at 12% per annum and mature with interest and principal both due on September 1, 2017. The notes and accrued interest may be converted into a subsequent offering at a 15% discount to the offering price are convertible at a conversion price as defined therein. In addition, the Company issued warrants to purchase 67,550 shares of Company common stock. The warrants entitle the holders to purchase the Company’s common stock at a purchase price of $0.20 per share for a period of five years from the issue date. As of December 31, 2017, the Company was currently in default on $71,500 in principal due on the notes.  On February 8, 2018, the Company repurchased these notes and is no longer in default.

The August 2017 Convertible Note Offering

From August through November of 2017, the Company conducted multiple closings of a private placement offering to accredited investors (the “August 2017 Convertible Note Offering”) of units of the Company’s securities by entering into subscription agreements with “accredited investors” (the “Investors”) for aggregate gross proceeds of $1,585,000. In addition, $1,217,177 of the Company’s short-term debt along with accrued but unpaid interest of $40,146 was converted into the August 2017 Convertible Note Offering. The conversions resulted in the issuance of 6,791,419 warrants with a fair value of $583,681 and an original issue discount of $101,561. These were recorded as a loss on extinguishment of debt.

The August 2017 Convertible Note Offering consisted of a maximum of $6,000,000 of units of the Company’s securities (each, a “Unit” and collectively, the “Units”), with each Unit consisting of (a) a 15% Convertible Secured Promissory Note (each a “August 2017 Offering Note” and together the “August 2017 Offering Notes”), convertible into shares of the Company’s common stock, par value $.001 per share (“August 2017 Offering Conversion Shares”) at a conversion price of $0.20 per share (the “August 2017 Note Conversion Price”), and (b) a five-year warrant (each a “August 2017 Offering Warrant and together the “August 2017 Offering Warrants”) to purchase common stock equal to one hundred percent (100%) of the shares into which the August 2017 Offering Notes can be converted into (“August 2017 Offering Warrant Shares”) at an exercise price of $0.20 per share (“August 2017 Offering Warrant Exercise Price”). The August 2017 Offering Notes mature on the second (2nd) anniversary of their issuance dates.

The August 2017 Note Conversion Price and the August 2017 Offering Warrant Exercise Price are subject to adjustment for issuances of the Company’s common stock or any equity linked instruments or securities convertible into the Company’s common stock at a purchase price of less than the prevailing August 2017 Note Conversion Price or August 2017 Offering Warrant Exercise Price. Such adjustment shall result in the August 2017 Note Conversion Price and August 2017 Offering Warrant Exercise Price being reduced to such lower purchase price, subject to carve-outs as described therein.

The Company recorded a $472,675 debt discount relating to 7,925,000 August 2017 Offering Warrants issued to investors based on the relative fair value of each equity instrument on the dates of issuance. The debt discount is being accreted over the life of the note to accretion of debt discount and issuance cost.

In connection with the August 2017 Convertible Note Offering, the Company paid a placement agent a cash fee of $90,508 to for services rendered in connection therewith on a “best-efforts” basis, which was recorded as issuance cost and is being accreted over the life of the note to accretion of debt discount and issuance cost. 

The First December 2017 Note

On December 27, 2017, the Company issued a convertible note to a third-party lender totaling $100,000 (the “First December 2017 Note”). The First December 2017 Note accrues interest at 15% per annum and matures with interest and principal both due on December 27, 2019. In addition, the Company issued a warrant to purchase 500,000 shares of Company common stock. The warrant entitles the holder to purchase the Company’s common stock at a purchase price of $0.20 per share for a period of five years from the issue date. The Company recorded a $35,525 debt discount relating to the warrants issued to the investor based on the relative fair value of each equity instrument on the dates of issuance. The debt discount is being accreted over the life of the note The First December 2017 Note and accrued interest is convertible at a conversion price of $0.20 per share, subject to adjustment. The First December 2017 Note is secured by a second priority lien on the assets of the Company.

The February 2018 Convertible Note Offering

During the six months ended June 30, 2018, the Company conducted multiple closings of a private placement offering to accredited investors (the “February 2018 Convertible Note Offering”) of units of the Company’s securities by entering into subscription agreements with “accredited investors” (the “Investors”) for aggregate gross proceeds of $725,000. In addition, $250,000 of the Company’s short-term debt along with accrued but unpaid interest of $40,675 was converted into the February 2018 Offering. The conversions resulted in the issuance of 1,453,375 warrants with a fair value of $181,139. These were recorded as a loss on extinguishment of debt.

The February 2018 Convertible Note Offering consisted of a maximum of $750,000 of units of the Company’s securities (each, a “Unit” and collectively, the “Units”), with each Unit consisting of (a) a 15% Convertible Secured Promissory Note (each a “February 2018 Convertible Note” and together the “February 2018 Convertible Notes”), convertible into shares of the Company’s common stock, par value $.001 per share (“February 2018 Conversion Shares”) at a conversion price of $0.20 per share (the “February 2018 Note Conversion Price”), and (b) a five-year warrant (each a “February 2018 Offering Warrant and together the “February 2018 Offering Warrants”) to purchase common stock equal to one hundred percent (100%) of the shares into which the February 2018 Convertible Notes can be converted into (“February 2018 Warrant Shares”) at an exercise price of $0.20 per share (“February 2018 Warrant Exercise Price”). The February 2018 Offering Notes mature on the second (2nd) anniversary of their issuance dates. The February 2018 Offering Notes are secured by a second priority security interest in the Company’s assets up to $1,000,000.

The February 2018 Note Conversion Price and the February 2018 Offering Warrant Exercise Price are subject to adjustment for issuances of the Company’s common stock or any equity linked instruments or securities convertible into the Company’s common stock at a purchase price of less than the prevailing Conversion Price or Exercise Price. Such adjustment shall result in the Conversion Price and Exercise Price being reduced to such lower purchase price, subject to carve-outs as described therein.

The conversion feature of the February 2018 Convertible Note Offering provides for an effective conversion price that is below market value on the date of issuance. Such feature is normally characterized as a beneficial conversion feature (“BCF”). When the Company records a BCF the relative fair value of the BCF is recorded as a debt discount against the face amount of the respective debt instrument. The Company recorded a BCF and related debt discount of $37,350, the discount is being accreted over the life of the first Debenture to accretion of debt discount and issuance cost.

The Company recorded a $316,875 debt discount relating to 3,625,000 February 2018 Offering Warrants issued to investors based on the relative fair value of each equity instrument on the dates of issuance. The debt discount is being accreted over the life of the note to accretion of debt discount and issuance cost.

In connection with the February 2018 Convertible Note Offering, the Company retained a placement agent (the “Placement Agent”), to carry out the Offering on a “best-efforts” basis. For services in its capacity as Placement Agent, the Company has paid the Placement Agent a cash fee of $94,250 and issued to the Placement Agent shares of the Company’s common stock equal to ten percent (13%) of the Conversion Shares underlying the February 2018 Convertible Notes or 362,500 shares that had a fair value of $74,881, which was recorded as issuance cost and is being accreted over the life of the note to accretion of debt discount and issuance cost.

The January 2018 Note

On January 12, 2018, the Company issued a convertible note to a third-party lender totaling $68,761 to settle an outstanding vendor liabilities (the “January 2018 Note”). The January 2018 Note accrues interest at 15% per annum and matures with interest and principal both due on January 12, 2020. The conversions resulted in the issuance of 343,806 warrants with a fair value of $42,850. These were recorded as a loss on extinguishment of debt. The warrant entitles the holder to purchase the Company’s common stock at a purchase price of $0.20 per share for a period of five years from the issue date. The January 2018 Note and accrued interest is convertible at a conversion price of $0.20 per share, subject to adjustment. The January 2018 Note is secured by a second priority lien on the assets of the Company.

The February 2018 Note

On February 8, 2018, the Company issued a convertible note to a third-party lender totaling $40,750 (the “February 2018 Note”). The February 2018 Note accrues interest at 18% per annum and matures with interest and principal both due on February 8, 2020. In addition, the Company issued a warrant to purchase 81,500 shares of Company common stock. The warrant entitles the holder to purchase the Company’s common stock at a purchase price of $0.20 per share for a period of five years from the issue date. The Company recorded a $7,963 debt discount relating to the warrants issued to the investor based on the relative fair value of each equity instrument on the dates of issuance and an original issue discount of $5,298. The debt discount is being accreted over the life of the note. The February 2018 Note and accrued interest is convertible at a conversion price of $0.20 per share, subject to adjustment. The February 2018 Note is secured by a second priority lien on the assets of the Company. During the six months ended the company has repaid $5,298 in principal.

The March 2018 Convertible Note Offering

During the six months ended June 30, 2018, the Company conducted multiple closings of a private placement offering to accredited investors (the “March 2018 Convertible Note Offering”) of units of the Company’s securities by entering into subscription agreements with “accredited investors” (the “Investors”) for aggregate gross proceeds of $770,000. In addition, $50,000 of the Company’s short-term debt, $767 accrued but unpaid interest and $140,600 of the Company’s vendor liabilities was converted into the March 2018 Convertible Note Offering. The conversions resulted in the issuance of 956,833 warrants with a fair value of $84,087. These were recorded as a loss on extinguishment of debt.

The March 2018 Convertible Note Offering consisted of a maximum of $900,000, with an over-allotment option of an additional $300,000 of units of the Company’s securities (each, a “Unit” and collectively, the “Units”), with each Unit consisting of (a) a 14% Convertible Secured Promissory Note (each a “Note” and together the “Notes”), convertible into shares of the Company’s common stock, par value $.001 per share (“Conversion Shares”) at a conversion price of $0.20 per share (the “Conversion Price”), and (b) a four-year warrant (each a “Warrant and together the “Warrants”) to purchase common stock equal to one hundred percent (100%) of the shares into which the Notes can be converted into (“Warrant Shares”) at an exercise price of $0.20 per share (“Exercise Price”). The Notes mature on the second (2nd) anniversary of their issuance dates.

The Conversion Price of the Note and the Exercise Price of the Warrants are subject to adjustment for issuances of the Company’s common stock or any equity linked instruments or securities convertible into the Company’s common stock at a purchase price of less than the prevailing Conversion Price or Exercise Price. Such adjustment shall result in the Conversion Price and Exercise Price being reduced to such lower purchase price, subject to carve-outs as described therein.

The Company recorded a $254,788 debt discount relating to 4,806,833 warrants issued to investors based on the relative fair value of each equity instrument on the dates of issuance. The debt discount is being accreted over the life of the note to accretion of debt discount and issuance cost.

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Related Party Loans

6 Months Ended

Jun. 30, 2018

Related Party Loans [Abstract]

Related Party Loans

Note 8 – Related Party Loans

Convertible notes

Convertible notes payable – related party as of June 30, 2018 and December 31, 2017 is as follows:

	Outstanding Principal as of										Warrants
	June 30, 2018			December 31, 2017			Interest Rate			Maturity Date	Quantity		Exercise Price
The August 2017 Convertible Note Offering	$	1,416,026		$	1,416,026			15	%	August – October 2019		4,589,466	$	0.20
The Second December 2017 Note		100,000			100,000			15	%	December 21, 2019		500,000		0.20
The February 2018 Convertible Note Offering		25,000			-			15	%	January – February 2020		125,000		0.20
The Second February 2018 Note		35,452			-			20	%	September 30, 2018		81,500		0.20
The March 2018 Convertible Note Offering		239,400			-			14	%	March 2020		1,197,000		0.20
		1,815,878			1,516,026
Less: Debt Discount		(208,525	)		(170,780	)
Less: Debt Issuance Costs		(4,645	)		-
		1,602,708			1,345,246
Less: Current Debt		(30,916	)		-
Total Long-Term Debt	$	1,571,792		$	1,345,246

The August 2017 Convertible Note Offering 

During the year ended December 31, 2017, the Company conducted multiple closings of a private placement offering to accredited investors (the “The August 2017 Convertible Offering”) of units of the Company’s securities by entering into subscription agreements with “accredited investors” (the “Investors”) for aggregate gross proceeds of $505,000. In addition, $645,000 of the Company’s short-term debt along with accrued but unpaid interest of $206,026 was converted into the August 2017 Convertible Offering. The conversions resulted in the issuance of 4,555,129 warrants with a fair value of $440,157 and the increase of principal of $60,000. These resulted in a loss on extinguishment of debt of $500,157.

The Company offered, through a placement agent, $6,000,000 of units of its securities (each, a “Unit” and collectively, the “Units”), with each Unit consisting of (a) a 15% Convertible Secured Promissory Note (each a “Note” and together the “Notes”), convertible into shares of the Company’s common stock, par value $.001 per share (“Conversion Shares”) at a conversion price of $0.20 per share (the “Conversion Price”), and (b) a five-year warrant (each a “Warrant and together the “Warrants”) to purchase common stock equal to one hundred percent (100%) of the shares into which the Notes can be converted into (“Warrant Shares”) at an exercise price of $0.20 per share (“Exercise Price”). The Notes mature on the second (2nd) anniversary of their issuance dates. 

The Conversion Price of the Note and the Exercise Price of the Warrants are subject to adjustment for issuances of the Company’s common stock or any equity linked instruments or securities convertible into the Company’s common stock at a purchase price of less than the prevailing Conversion Price or Exercise Price. Such adjustment shall result in the Conversion Price and Exercise Price being reduced to such lower purchase price, subject to carve-outs as described therein.

The Company recorded a $160,700 debt discount relating to 2,525,000 warrants issued to investors based on the relative fair value of each equity instrument on the dates of issuance. The debt discount is being accreted over the life of the note to accretion of debt discount and issuance cost.

The Second December 2017 Note

On December 21, 2017, the Company issued a convertible note to a third-party lender totaling $100,000 (the “Second December 2017 Note”). The Second December 2017 Note accrues interest at 15% per annum and matures with interest and principal both due on December 27, 2019. In addition, the Company issued a warrant to purchase 500,000 shares of Company common stock. The warrant entitles the holder to purchase the Company’s common stock at a purchase price of $0.20 per share for a period of five years from the issue date. The Company recorded a $36,722 debt discount relating to the warrants issued to the investor based on the relative fair value of each equity instrument on the dates of issuance. The debt discount is being accreted over the life of the note The Second December 2017 Note and accrued interest is convertible at a conversion price of $0.20 per share, subject to adjustment. The Second December 2017 Note is secured as a second priority lien on the assets of the Company.

The February 2018 Convertible Note Offering

During the six months ended June 30, 2018, the Company conducted multiple closings of a private placement offering to accredited investors (the “February 2018 Convertible Note Offering”) of units of the Company’s securities by entering into subscription agreements with “accredited investors” (the “Investors”) for aggregate gross proceeds of $25,000.

The February 2018 Convertible Note Offering consisted of a maximum of $750,000 of units of the Company’s securities (each, a “Unit” and collectively, the “Units”), with each Unit consisting of (a) a 15% Convertible Secured Promissory Note (each a “Note” and together the “Notes”), convertible into shares of the Company’s common stock, par value $.001 per share (“Conversion Shares”) at a conversion price of $0.20 per share (the “Conversion Price”), and (b) a five-year warrant (each a “Warrant and together the “Warrants”) to purchase common stock equal to one hundred percent (100%) of the shares into which the Notes can be converted into (“Warrant Shares”) at an exercise price of $0.20 per share (“Exercise Price”). The Notes mature on the second (2nd) anniversary of their issuance dates. The Notes are secured by a second priority security interest in the Company’s assets up to $1,000,000.

The Conversion Price of the Note and the Exercise Price of the Warrants are subject to adjustment for issuances of the Company’s common stock or any equity linked instruments or securities convertible into the Company’s common stock at a purchase price of less than the prevailing Conversion Price or Exercise Price. Such adjustment shall result in the Conversion Price and Exercise Price being reduced to such lower purchase price, subject to carve-outs as described therein.

The conversion feature of the February 2018 Convertible Note Offering provides for an effective conversion price that is below market value on the date of issuance. Such feature is normally characterized as a beneficial conversion feature (“BCF”). When the Company records a BCF the relative fair value of the BCF is recorded as a debt discount against the face amount of the respective debt instrument. The Company recorded a BCF and related debt discount of $1,063, the discount is being accreted over the life of the first Debenture to accretion of debt discount and issuance cost.

The Company recorded a $11,054 debt discount relating to 125,000 warrants issued to investors based on the relative fair value of each equity instrument on the dates of issuance. The debt discount is being accreted over the life of the note to accretion of debt discount and issuance cost.

In connection with the Offering, the Company retained the Placement Agent, to carry out the Offering on a “best-efforts” basis. For services in its capacity as Placement Agent, the Company has paid the Placement Agent a cash fee of $3,250 and issued to the Placement Agent shares of the Company’s common stock equal to ten percent (10%) of the Conversion Shares underlying the Notes or 12,500 shares that had a fair value of $2,606, which was recorded as issuance cost and is being accreted over the life of the note to accretion of debt discount and issuance cost.

The Second February 2018 Note

On February 8, 2018, the Company issued a convertible note to a third-party lender totaling $40,750 (the “Second February 2018 Note”). The Second February 2018 Note accrues interest at 18% per annum and matures with interest and principal both due on September 30, 2018. In addition, the Company issued a warrant to purchase 81,500 shares of Company common stock. The warrant entitles the holder to purchase the Company’s common stock at a purchase price of $0.20 per share for a period of five years from the issue date. The Company recorded a $7,963 debt discount relating to the warrants issued to the investor based on the relative fair value of each equity instrument on the dates of issuance and an original issue discount of $5,298. The debt discount is being accreted over the life of the note The Second February 2018 Note and accrued interest is convertible at a conversion price of $0.20 per share, subject to adjustment. The Second February 2018 Note is secured as a second priority lien on the assets of the Company. During the six months ended the company has repaid $5,298 in principal.

The March 2018 Convertible Note Offering

During the six months ended June 30, 2018, the Company conducted multiple closings of a private placement offering to accredited investors (the “March 2018 Convertible Note Offering”) of units of the Company’s securities by entering into subscription agreements with “accredited investors” (the “Investors”) for aggregate gross proceeds of $239,400.

The March 2018 Convertible Note Offering consisted of a maximum of $900,000, with an over-allotment option of an additional $300,000, of units of the Company’s securities (each, a “Unit” and collectively, the “Units”), with each Unit consisting of (a) a 14% Convertible Secured Promissory Note (each a “Note” and together the “Notes”), convertible into shares of the Company’s common stock, par value $.001 per share (“Conversion Shares”) at a conversion price of $0.20 per share (the “Conversion Price”), and (b) a four-year warrant (each a “Warrant and together the “Warrants”) to purchase common stock equal to one hundred percent (100%) of the shares into which the Notes can be converted into (“Warrant Shares”) at an exercise price of $0.20 per share (“Exercise Price”). The Notes mature on the second (2nd) anniversary of their issuance dates.

The Conversion Price of the Note and the Exercise Price of the Warrants are subject to adjustment for issuances of the Company’s common stock or any equity linked instruments or securities convertible into the Company’s common stock at a purchase price of less than the prevailing Conversion Price or Exercise Price. Such adjustment shall result in the Conversion Price and Exercise Price being reduced to such lower purchase price, subject to carve-outs as described therein.

The Company recorded a $84,854 debt discount relating to 1,197,000 warrants issued to investors based on the relative fair value of each equity instrument on the dates of issuance. The debt discount is being accreted over the life of the note to accretion of debt discount and issuance cost.

Notes payable

Notes payable – related party as of June 30, 2018 and December 31, 2017 is as follows:

	Outstanding Principal as of									Warrants
	June 30, 2018			December 31, 2017		Interest Rate			Maturity Date	Quantity		Exercise Price
The May 2016 Rosen Loan Agreement	$	1,000,000		$	1,000,000		13	%	November 26, 2017		1,000,000	$	0.40
The September 2017 Rosen Loan Agreement		224,000			224,000		18	%	September 24, 2017		125,000		0.20
The November 2017 Schiller Loan Agreement		-			25,000		15	%	December 31, 2017		-		-
The May 2018 Schiller Loan Agreement		100,000			-		13	%	February 2, 2019		300,000		0.20
The June 2018 Frommer Loan Agreement		10,000			-		6	%	August 17, 2018		30,000		0.20
		1,334,000			1,249,000
Less: Current Debt		(28,093	)		-
	$	1,305,907		$	1,249,000

The May 2016 Rosen Loan Agreement

On May 26, 2016, the Company entered into a loan agreement (the “May 2016 Rosen Loan Agreement”) with Arthur Rosen, an individual (“Rosen”), pursuant to which on May 26, 2016 (the “Closing Date”), Rosen provided the Company a secured term loan of $1,000,000 (the “May 2016 Rosen Loan”). In connection with the May 2016 Rosen Loan Agreement, on May 26, 2016, the Company and Rosen entered into a security agreement (the “Rosen Security Agreement”), pursuant to which the Company granted to Rosen a senior security interest in substantially all of the Company’s assets as security for repayment of the May 2016 Rosen Loan. Pursuant to the May 2016 Rosen Loan Agreement, the May 2016 Rosen Loan bears interest at a rate of 12.5% per annum, compounded annually and payable on the maturity date of May 26, 2017 (the “May 2016 Rosen Maturity Date”) at which time all outstanding principal, accrued and unpaid interest and other amounts due under the May 2016 Rosen Loan are due. The Company entered into an amendment to the May 2016 Rosen Loan extending the May 2016 Rosen Maturity Date to November 26, 2017. As additional consideration for entering in the May 2016 Rosen Loan Agreement, the Company issued Rosen a five-year warrant to purchase 1,000,000 shares of the Company’s common stock at a purchase price of $0.40 per share (the “May 2016 Rosen Warrant”). The May 2016 Rosen Warrant contains anti-dilution provisions as further described therein. On September 7, 2017 (the “Conversion Date”), Rosen converted all accrued but unpaid interest on the May 2016 Rosen Loan from May 26, 2016 through September 6, 2017 in the amount of $150,128 (the “May 2016 Rosen Loan Interest”) into the Company’s August Convertible Note Offering, after which May 2016 Rosen Loan Interest was deemed paid in full through the Conversion Date. 

The September 2017 Rosen Loan Agreement

On September 8, 2017, the Company entered into a loan agreement (the “September 2017 Rosen Loan Agreement”) with Rosen, whereby the Company issued Rosen a promissory note of $224,000 (the “September 2017 Rosen Note”). The September 2017 Rosen Note is secured by an officer of the Company. As additional consideration for entering in the September 2017 Rosen Note Loan Agreement, the Company issued Rosen a five-year warrant to purchase 25,000 shares of the Company’s common stock at a purchase price of $0.20 per share. On November 13, 2017, in consideration for extending the Promissory Note, Rosen was issued a warrant to purchase 100,000 shares of the Company’s Common Stock exercisable within five (5) years and with an exercise price of $0.20 per share. On February 20, 2018 the company entered into a Forbearance agreement whereas the Company issued Rosen a five-year warrant to purchase 448,000 shares of the Company’s common stock at a purchase price of $0.20 per share. The warrants had a fair value of $65,378 which was recorded to Loss on extinguishment of debt. The new Maturity Date is September 8, 2018.

The November 2017 Schiller Loan Agreement

On November 20, 2017, the Company entered into a loan agreement (the “November 2017 Schiller Loan Agreement”) Schiller, a member of the Board, whereby the Company issued Schiller a promissory note of $25,000 (the “November 2017 Schiller Note”). Pursuant to the November 2017 Schiller Loan Agreement, the November 2017 Schiller Note bears interest at a rate of 15% per annum. During the six months ended June 30, 2018 the Company repaid $25,000 in principal and $637 in interest.

The January 2018 Rosen Loan Agreement

On January 16, 2018, the Company entered into a loan agreement (the “January 2018 Rosen Loan Agreement”) with Rosen, whereby the Company issued Rosen a promissory note of $60,000 (the “January 2018 Rosen Note”). The January 2018 Rosen Note is secured by an officer of the Company whereas upon default an officer of the company owes default shares to the lender equal to the amount of principal outstanding divided by 0.20. Pursuant to the January 2018 Rosen Loan Agreement, the January 2018 Rosen Note bears interest at a rate of 6% per annum and payable on the maturity date of January 31, 2018 (the “January 2018 Rosen Maturity Date”) at which time all outstanding principal, accrued and unpaid interest and other amounts due under the May 2016 Rosen Loan are due. During the six months ended the company has repaid $60,000 in principal and $200 in interest.

The January 2018 Gordon Loan Agreement

On January 16, 2018, the Company entered into a loan agreement (the “January 2018 Gordon Loan Agreement”) with Gordon, whereby the Company issued Gordon a promissory note of $40,000 (the “January 2018 Gordon Note”). The January 2018 Gordon Note is secured by an officer of the Company whereas upon default an officer of the company owes default shares to the lender equal to the amount of principal outstanding divided by 0.20. Pursuant to the January 2018 Gordon Loan Agreement, the January 2018 Gordon Note bears interest at a rate of 6% per annum and payable on the maturity date of January 31, 2018 (the “January 2018 Gordon Maturity Date”) at which time all outstanding principal, accrued and unpaid interest and other amounts due under the January 2018 Gordon Loan are due. During the six months ended the company have repaid $40,000 in principal and $105 in interest.

The First March 2018 Rosen Loan Agreement

On March 4, 2018, the Company entered into a loan agreement (the “First March 2018 Rosen Loan Agreement”) with Rosen, whereby the Company issued Rosen a promissory note of $10,000 (the “First March 2018 Rosen Note”). As additional consideration for entering in the First March 2018 Rosen Note Loan Agreement, the Company issued Rosen a five-year warrant to purchase 10,000 shares of the Company’s common stock at a purchase price of $0.20 per share. Pursuant to the First March 2018 Rosen Loan Agreement, the First March 2018 Rosen Note bears interest at a rate of 12% per annum and payable on the maturity date of March 19, 2018 (the “First March 2018 Rosen Maturity Date”) at which time all outstanding principal, accrued and unpaid interest and other amounts due under the First March 2018 Rosen Loan was due. During the six months ended the company have repaid $10,000 in principal and $260 in interest.

The Second March 2018 Rosen Loan Agreement

On March 9, 2018, the Company entered into a loan agreement (the “Second March 2018 Rosen Loan Agreement”) with Rosen, whereby the Company issued Rosen a promissory note of $15,000 (the “Second March 2018 Rosen Note”). As additional consideration for entering in the Second March 2018 Rosen Note Loan Agreement, the Company issued Rosen a five-year warrant to purchase 15,000 shares of the Company’s common stock at a purchase price of $0.20 per share. Pursuant to the Second March 2018 Rosen Loan Agreement, the Second March 2018 Rosen Note bears interest at a rate of 12% per annum and payable on the maturity date of March 24, 2018 (the “Second March 2018 Rosen Maturity Date”) at which time all outstanding principal, accrued and unpaid interest and other amounts due under the Second March 2018 Rosen Loan was due. During the six months ended the company have repaid $15,000 in principal and $365 in interest.

The Third March 2018 Rosen Loan Agreement

On March 13, 2018, the Company entered into a loan agreement (the “Third March 2018 Rosen Loan Agreement”) with Rosen, whereby the Company issued Rosen a promissory note of $10,000 (the “Third March 2018 Rosen Note”). As additional consideration for entering in the Third March 2018 Rosen Note Loan Agreement, the Company issued Rosen a five-year warrant to purchase 10,000 shares of the Company’s common stock at a purchase price of $0.20 per share. Pursuant to the Third March 2018 Rosen Loan Agreement, the Third March 2018 Rosen Note bears interest at a rate of 12% per annum and payable on the maturity date of March 28, 2018 (the “Third March 2018 Rosen Maturity Date”) at which time all outstanding principal, accrued and unpaid interest and other amounts due under the Third March 2018 Rosen Loan was due. During the six months ended the company have repaid $10,000 in principal and $230 in interest.

The May 2018 Schiller Loan Agreement

On May 2, 2018, the Company entered into a loan agreement (the “May 2018 Schiller Loan Agreement”) Schiller, a member of the Board, whereby the Company issued Schiller a promissory note of $100,000 (the “May 2018 Schiller Note”). As additional consideration for entering in the May 2018 Schiller Note Loan Agreement, the Company issued Schiller a four-year warrant to purchase 300,000 shares of the Company’s common stock at a purchase price of $0.20 per share. Pursuant to the May 2018 Schiller Loan Agreement, the May 2018 Schiller Note bears interest at a rate of 13% per annum and payable on the maturity date of February 02, 2019 (the “May 2018 Schiller Maturity Date”) at which time all outstanding principal, accrued and unpaid interest are due under the May 2018 Schiller Loan.

The June 2018 Frommer Loan Agreement

On June 29, 2018, the Company entered into a loan agreement (the “June 2018 Frommer Loan Agreement”) Frommer, an officer of the company, whereby the Company issued Frommer a promissory note of $10,000 (the “June 2018 Frommer Note”). As additional consideration for entering in the June 2018 Frommer Note Loan Agreement, the Company issued Frommer a four-year warrant to purchase 30,000 shares of the Company’s common stock at a purchase price of $0.20 per share. Pursuant to the June 2018 Frommer Loan Agreement, the June 2018 Frommer Note bears interest at a rate of 6% per annum and payable on the maturity date of August 17, 2018 (the “June 2018 Frommer Maturity Date”) at which time all outstanding principal, accrued and unpaid interest are due under the June 2018 Frommer Loan.

Line of credit – related party

On May 9, 2017, the Company entered into a Revolving Line of Credit (the “LOC”) with Grawin, LLC, an LLC controlled by Arthur Rosen, a related party. The LOC was established for a period of twelve months, with a maturity date of May 2018, in which the Company can borrow principal up to $130,000. The LOC bears interest at a rate of 18%.  On June 8, 2018 the Revolving Line of Credit’s maturity date was extended to June 1, 2019.

As of June 30, 2018, the total outstanding balance of line of credit - related party was $130,000.

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Capital Leases Payable

6 Months Ended

Jun. 30, 2018

Capital Leases Payable [Abstract]

Capital Leases Payable

Note 9 – Capital Leases Payable

Capital lease obligation consisted of the following:

		June 30, 2018			December 31, 2017
(i)	Capital lease obligation to a financing company for a term of five (5) years, collateralized by equipment, with interest at 10.0% per annum, with principal and interest due and payable in monthly installments of $383.10	$	4,732		$	4,732
	Less current maturities		(4,732	)		(4,732	)
	Capital lease obligation, net of current maturities		-			-
	TOTAL CAPITAL LEASE OBLIGATION	$	4,732		$	4,732

The capital leases mature as follows:

2018: $ 4,732 $ 4,732

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Stockholders' Deficit

6 Months Ended

Jun. 30, 2018

Stockholders' Deficit [Abstract]

Stockholders' Deficit

Note 10 – Stockholders’ Deficit

Shares Authorized

Upon incorporation, the total number of shares of all classes of stock which the Company is authorized to issue is Three Hundred Twenty Million (320,000,000) shares of which Three Hundred Million (300,000,000) shares shall be Common Stock, par value $0.001 per share and Twenty Million (20,000,000) shall be Preferred Stock, par value $0.001 per share. The designations, rights, and preferences of such preferred stock are to be determined by the Board of Directors.

Preferred Stock

Series A Cumulative Convertible Preferred Stock

On February 13, 2015, 100,000 shares of preferred stock were designated as Series A Cumulative Convertible Preferred Stock (“Series A”). Each share of Series A shall have a stated value equal to $100 (as adjusted for any stock dividends, combinations or splits with respect to such shares) (the “Series A Stated Value”).

The holders of the Series A shall be entitled to receive preferential dividends at the rate of 6% per share per annum on the Series A Stated Value, but before any dividend or other distribution will be paid or declared and set apart for payment on any shares of any Junior Stock, as defined. Such dividends shall compound annually and be fully cumulative, and shall accumulate from the date of original issuance of the Series A and shall be payable quarterly, in arrears, commencing on the first day of the calendar quarter following the date on which the Series A is issued. Upon the occurrence of an Event of Default (as defined below) and while such Event of Default is outstanding, such dividend rate shall be increased to 15% per annum on the Series A Stated Value. At the Company’s option, such dividend payments may be made in (i) cash (ii) additional shares of Series A valued at the Series A Stated Value thereof, in an amount equal to 150% of the cash dividend otherwise payable or (iii) a combination of cash and additional shares of Series A, provided there is not an existing current Event of Default on the date on which a dividend payment is payable, in which event the Holder entitled to receive such dividend may elect to receive such dividends in cash or additional shares of Series A Preferred.

The dividends on the Series A shall be cumulative whether or not declared so that, if at any time full cumulative dividends at the rate aforesaid on all shares of the Series A then outstanding from the date from and after which dividends thereon are cumulative to the end of the annual dividend period next preceding such time shall not have been paid or declared and set apart for payment, or if the full dividend on all such outstanding Series A for the then current dividend period shall not have been paid or declared and set apart for payment, the amount of the deficiency shall be paid or declared and set apart for payment before any sum shall be set apart for or applied by the Corporation or a subsidiary of the Corporation to the purchase, redemption or other acquisition of the Series A or any shares of any other class of stock ranking on a parity with the Series A and before any dividend or other distribution shall be paid or declared and set apart for payment on any Junior Stock and before any sum shall be set aside for or applied to the purchase, redemption or other acquisition of any Junior Stock.

Holder of Series A shall have the right at any time after the issuance, to convert such shares, accrued but unpaid declared dividends on the Series A and any other sum owed by the Corporation arising from the Series A into fully paid and non-assessable shares of Common Stock (the “Conversion Shares”) of the Corporation determined in accordance with the applicable conversion price (the “Conversion Price”). 

The number of Conversion Shares issuable upon conversion shall equal (i) the sum of (A) the Series A Stated Value being converted and/or (B) at the Holder’s election, accrued and unpaid dividends or any other component of the Conversion Amount, divided by (ii) the Conversion Price. The Conversion Price of the Series A shall be $0.25, subject to adjustment.

During the year ended December 31, 2016 the conversion price was adjusted to $0.164

The Corporation and the Holder may not convert that amount of the Conversion Amount on a Conversion Date in amounts that would result in the Holder having a beneficial ownership of Common Stock which would be in excess of the sum of (i) the number of shares of Common Stock beneficially owned by the Holder and its Affiliates on such Conversion Date, and (ii) the number of Conversion Shares issuable upon the conversion of the Conversion Amount with respect to which the determination of this provision is being made on such Conversion Date, which would result in the aggregate beneficial ownership by the Holder and its Affiliates of more than 4.99% of the outstanding shares of Common Stock of the Corporation. For the purposes of the proviso to the immediately preceding sentence, beneficial ownership shall be determined in accordance with Section 13(d) of the 1934 Act and Regulation 13d-3 thereunder. Subject to the foregoing, the Holder shall not be limited to successive exercises which would result in the aggregate issuance of more than 4.99%. The Holder may allocate which of the equity of the Corporation deemed beneficially owned by the Holder shall be included in the 4.99% amount described above and which shall be allocated to the excess above 4.99%. The Holder may waive the conversion limitation described in this Section in whole or in part, upon and effective after sixty-one (61) days’ prior written notice to the Corporation.

The holders of our Series A do vote together with the holders of our Common Stock on an as converted basis on each matter submitted to a vote of holders of Common Stock. The number of votes that may be cast by a holder of Series A shall be equal to the number of shares of Common Stock issuable upon conversion of such Holder’s Series A on the record date for determining those stockholders entitled to vote on the matter. In addition, the affirmative vote of the holders of a majority of our outstanding Series A is required to for the following actions:

(a) amending the Corporation’s certificate of incorporation or by-laws if such amendment would adversely affect the Series A

(b) purchasing any of the Corporation’s securities other than required redemptions of Series A and repurchase under restricted stock and option agreements authorizing the Corporation’s employees;

(c) effecting a Liquidation Event;

(d) declaring or paying any dividends other than in respect of the Series A; and

(e) issuing any additional securities having rights senior to or on parity with the Series A.

As of June 30, 2018, the company has undeclared Series A dividends of $636,772.

Series B Cumulative Convertible Preferred Stock

On December 21, 2015, 20,000 shares of preferred stock were designated as Series B Cumulative Convertible Preferred Stock (“Series B”). Each share of Series B shall have a stated value equal to $100.00 (as adjusted for any stock dividends, combinations or splits with respect to such shares) (the “Series B Stated Value”).

The holders of outstanding shares of Series B shall be entitled to receive preferential dividends at the rate of 6% per share per annum on the Series B Stated Value, but before any dividend or other distribution will be paid or declared and set apart for payment on any shares of any Junior Stock as defined. Such dividends shall compound annually and be fully cumulative, and shall accumulate from the date of original issuance of the Series B, and shall be payable quarterly, in arrears, commencing on the first day of the calendar quarter following the date on which the Series B is issued. Upon the occurrence of an Event of Default as defined below and while such Event of Default is outstanding, such dividend rate shall be increased to 15% per annum on the Series B Stated Value. At the Corporation’s option, such dividend payments may be made in (i) cash (ii) additional shares of Series B valued at the Series B Stated Value thereof, in an amount equal to 100% of the cash dividend otherwise payable or (iii) a combination of cash and additional shares of Series B, provided there is not an existing current Event of Default on the date on which a dividend payment is payable, in which event the Holder entitled to receive such dividend may elect to receive such dividends in cash or additional shares of Series B Preferred.

The dividends on the Series B shall be cumulative whether or not declared so that, if at any time full cumulative dividends at the rate aforesaid on all shares of the Series B then outstanding from the date from and after which dividends thereon are cumulative to the end of the annual dividend period next preceding such time shall not have been paid or declared and set apart for payment, or if the full dividend on all such outstanding Series B for the then current dividend period shall not have been paid or declared and set apart for payment, the amount of the deficiency shall be paid or declared and set apart for payment before any sum shall be set apart for or applied by the Corporation or a subsidiary of the Corporation to the purchase, redemption or other acquisition of the Series B or any shares of any other class of stock ranking on a parity with the Series B and before any dividend or other distribution shall be paid or declared and set apart for payment on any Junior Stock and before any sum shall be set aside for or applied to the purchase, redemption or other acquisition of any Junior Stock.

Holders of shares of Series B shall have the right at any time commencing after the issuance to convert such shares, accrued but unpaid declared dividends on the Series B into fully paid and non-assessable shares of Common Stock (the “Conversion Shares”) of the Corporation determined in accordance with the applicable conversion price (the “Conversion Price”). All declared or accrued but unpaid dividends may be converted at the election of the Holder together with or independent of the conversion of the Series B Stated Value of the Series B. 

The number of Conversion Shares issuable upon conversion of the Conversion Amount shall equal (i) the sum of (A) the Series B Stated Value being converted and/or (B) at the Holder’s election, accrued and unpaid dividends or any other component of the Conversion Amount, divided by (ii) the Conversion Price. The Conversion Price of the Series B shall be $0.30, subject to adjustment.

During the year ended December 31, 2016 the conversion price was adjusted to $0.197

The Corporation and the Holder may not convert that amount of the Conversion Amount on a Conversion Date in amounts that would result in the Holder having a beneficial ownership of Common Stock which would be in excess of the sum of (i) the number of shares of Common Stock beneficially owned by the Holder and its Affiliates on such Conversion Date, and (ii) the number of Conversion Shares issuable upon the conversion of the Conversion Amount with respect to which the determination of this proviso is being made on such Conversion Date, which would result in the aggregate beneficial ownership by the Holder and its Affiliates of more than 4.99% of the outstanding shares of Common Stock of the Corporation. For the purposes of the proviso to the immediately preceding sentence, beneficial ownership shall be determined in accordance with Section 13(d) of the 1934 Act and Regulation 13d-3 thereunder. Subject to the foregoing, the Holder shall not be limited to successive exercises which would result in the aggregate issuance of more than 4.99%. The Holder may allocate which of the equity of the Corporation deemed beneficially owned by the Holder shall be included in the 4.99% amount described above and which shall be allocated to the excess above 4.99%. The Holder may waive the conversion limitation described in this Section in whole or in part, upon and effective after sixty one (61) days’ prior written notice to the Corporation.

The holders of our Series B do vote together with the holders of our Common Stock on an as converted basis on each matter submitted to a vote of holders of Common Stock. The number of votes that may be cast by a holder of Series B shall be equal to the number of shares of Common Stock issuable upon conversion of such Holder’s Series B on the record date for determining those stockholders entitled to vote on the matter. In addition, the affirmative vote of the holders of a majority of our outstanding Series B is required to for the following actions:

(a) amending the Corporation’s certificate of incorporation or by-laws if such amendment would adversely affect the Series B

(b) purchasing any of the Corporation’s securities other than required redemptions of Series B and repurchase under restricted stock and option agreements authorizing the Corporation’s employees;

(c) effecting a Liquidation Event;

(d) declaring or paying any dividends other than in respect of the Company’s Series A or Series B; and

(e) issuing any additional securities having rights senior to the Series B. 

As of June 30, 2018, the company has undeclared Series B dividends of $118,289.

Common Stock

On January 31, 2018, the Company issued 18,750 shares of its restricted common stock to settle outstanding vendor liabilities of $3,750. In connection with this transaction the Company also recorded a gain on settlement of vendor liabilities of $375. 

During the six months ended June 30, 2018, the Company issued 610,000 shares of its restricted common stock to consultants in exchange for services at a fair value of $116,300. These shares were recorded as common stock issued for prepaid services and will be expensed over the life of the consulting contract to share based payments. During the six months ended June 30, 2018 the Company recorded $48,889 to share based payments.

Stock Options

The Company applied fair value accounting for all share-based payments awards. The fair value of each option granted is estimated on the date of grant using the Black-Scholes option-pricing model. 

At June 30, 2018 and 2017, the aggregate intrinsic value of options outstanding and exercisable was $0 and $0, respectively. 

Stock-based compensation for stock options has been recorded in the consolidated statements of operations and totaled $232,129 and $463,619, for the six months ended June 30, 2018 and 2017, respectively.

The Company did not issue any new options during the six months ended June 30, 2018.

Warrants

The Company applied fair value accounting for all share-based payments awards. The fair value of each warrant granted is estimated on the date of grant using the Black-Scholes option-pricing model.

The assumptions used for warrants granted during the six months ended June 30, 2018 are as follows:

	June 30, 2018
Exercise price	$	0.20
Expected dividends		0	%
Expected volatility		92.14%-100.56%
Risk free interest rate		1.64%-2.69%
Expected life of warrant		4 - 5 years

Warrant Activities

The following is a summary of the Company’s warrant activity:

	Warrants			Weighted Average Exercise Price
Outstanding – December 31, 2017		46,193,779		$	0.24
Granted		15,873,016			0.20
Exercised		(50,000	)		0.40
Forfeited/Cancelled		-			-
Outstanding and Exercisable – June 30, 2018		62,016,795		$	0.24

Warrants Outstanding								Warrants Exercisable
Exercise price		Number Outstanding		Weighted Average Remaining Contractual Life (in years)		Weighted Average Exercise Price		Number Exercisable		Weighted Average Exercise Price
$	0.20		62,016,795		3.66		0.24		62,016,795		0.24

During the six months ended June 30, 2018, a total of 2,425,500 warrants were issued with promissory notes (See Note 6 above). The warrants have a grant date fair value of $420,456 using a Black-Scholes option-pricing model and the above assumptions.

During the six months ended June 30, 2018, a total of 10,481,016 warrants were issued with convertible notes (See Note 7 above). The warrants have a grant date fair value of $1,284,683 using a Black-Scholes option-pricing model and the above assumptions.

During the six months ended June 30, 2018, a total of 1,563,000 warrants were issued with notes payable – related party (See Note 8 above). The warrants have a grant date fair value of $307,808 using a Black-Scholes option-pricing model and the above assumptions.

During the six months ended June 30, 2018, a total of 1,403,500 warrants were issued with convertible notes payable – related party (See Note 8 above). The warrants have a grant date fair value of $162,834 using a Black-Scholes option-pricing model and the above assumptions.

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Commitments and Contingencies

6 Months Ended

Jun. 30, 2018

Commitments and Contingencies [Abstract]

Commitments and Contingencies

Note 11 – Commitments and Contingencies

Lease Agreements

On May 5, 2018, the Company signed a 5-year lease for approximately 2,300 square feet of office space at 2050 Center Avenue suite 640, Fort lee, New Jersey 07024. Commencement date of the lease is June 1, 2018. Total amount due under this lease is $411,150.

The annual minimum lease payments under non-cancellable operating leases, that have an initial or remaining term in excess of one year at June 30, 2018 are due as follows:

2018	$	35,972
2019		74,204
2020		78,146
2021		82,207
2022		87,851
2023		37,775
Total minimum lease payments	$	396,155

Rent expense for the three and six months ended June 30, 2018 was $88,875 and $69,022, respectively, and was $155,661 and $77,856, respectively, for the three and six months ended June 30, 2017.

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Revision of Prior Year Financial Statements

6 Months Ended

Jun. 30, 2018

Revision of Prior Year Financial Statements [Abstract]

Revision of Prior Year Financial Statements

Note 12 – Revision of Prior Year Financial Statements:

The Company’s correction of accrued dividends were a result of the following:

● Management was accruing dividends as a liability, despite the fact the Board of Directors had not formally declared the dividends payable. This results in accrued dividends being removed from the liabilities section of the balance sheet,

● Management was not compounding the dividends annually,

● Management was not presenting the accrued dividends on the consolidated statement of operations, ultimately being included in the loss per share.

In accordance with the guidance provided by the SEC’s Staff Accounting Bulletin 99, Materiality and Staff Accounting Bulletin No. 108, Considering the Effects of Prior Year Misstatements when Quantifying Misstatements in Current Year Financial Statements the Company has determined that the impact of adjustments relating to the correction of this accounting error are not material to previously issued consolidated financial statements. Accordingly, these changes are disclosed herein and will be disclosed prospectively.

As a result of the aforementioned correction of accounting errors, the relevant financial statements have been revised as follows:

Effects on respective financial statements are as noted below:

	December 31, 2017
	As Previously Reported		Adjustment			As Revised
Balance Sheet
Current Liabilities
Accrued dividends	$	472,444	$	(472,444	)	$	-
Total Current Liabilities		4,159,644		(472,444	)		3,687,200
Total Liabilities	$	8,017,183	$	(472,444	)	$	7,544,739
Stockholders’ Equity
Total Stockholders’ Equity		7,839,751		(472,444	)		7,367,307

	For the six months ended June 30, 2017
	As Previously Reported			Adjustments		As Revised
Statement of Operations
Deemed dividend	$	-		$	131,867	$	131,867
Net loss attributable to common stockholders	$	2,955,909		$	131,867	$	3,087,776
Basic and diluted loss per share	$	(0.08	)	$	-		(0.08	)
Statements of Cash Flows
Supplementary Disclosure of Non-Cash Investing And Financing Activities
Deemed dividend	$	101,385		$	30,482	$	131,867

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Subsequent Events

6 Months Ended

Jun. 30, 2018

Subsequent Events [Abstract]

Subsequent Events

Note 13 – Subsequent Events

Subsequent to June 30, 2018, the Company received gross proceeds of $100,000 from the issuance of notes payable. As additional consideration for entering in the debentures, the Company issued the investors 4-year warrant to purchase 300,000 shares of the Company’s common stock at a purchase price of $0.20 per share.

Subsequent to June 30, 2018, the Company received gross proceeds from related parties of $25,000 of the issuance of notes payable. As additional consideration for entering in the convertible debentures, the Company issued the investors 4-year warrant to purchase 75,000 shares of the Company’s common stock at a purchase price of $0.20 per share.

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Significant and Critical Accounting Policies and Practices (Policies)

6 Months Ended

Jun. 30, 2018

Significant and Critical Accounting Policies and Practices [Abstract]

Basis of Presentation - Unaudited Interim Financial Information

Basis of Presentation - Unaudited Interim Financial Information

The accompanying unaudited interim condensed consolidated financial statements and related notes have been prepared in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”) for interim financial information, and in accordance with the rules and regulations of the United States Securities and Exchange Commission (the “SEC”) with respect to Form 10-Q and Article 10 of Regulation S-X. Accordingly, they do not include all of the information and footnotes required by U.S. GAAP for complete financial statements. The unaudited interim condensed consolidated financial statements furnished reflect all adjustments (consisting of normal recurring adjustments) which are, in the opinion of management, necessary for a fair statement of the results for the interim periods presented. Interim results are not necessarily indicative of the results for the full year. These unaudited interim condensed consolidated financial statements should be read in conjunction with the audited consolidated financial statements and notes thereto contained in the Company’s annual report on Form 10-K for the year ended December 31, 2017.

Use of Estimates and Assumptions and Critical Accounting Estimates and Assumptions

Use of Estimates and Assumptions and Critical Accounting Estimates and Assumptions

The preparation of financial statements in conformity with US GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the dates of the financial statements and the reported amounts of revenues and expenses during the reporting periods.

Critical accounting estimates are estimates for which (a) the nature of the estimate is material due to the levels of subjectivity and judgment necessary to account for highly uncertain matters or the susceptibility of such matters to change and (b) the impact of the estimate on financial condition or operating performance is material. The Company’s critical accounting estimates and assumptions affecting the financial statements were:

(i)	Assumption as a going concern: Management assumes that the Company will continue as a going concern, which contemplates continuity of operations, realization of assets, and liquidation of liabilities in the normal course of business.
(ii)	Fair value of long-lived assets: Fair value is generally determined using the asset’s expected future discounted cash flows or market value, if readily determinable. If long-lived assets are determined to be recoverable, but the newly determined remaining estimated useful lives are shorter than originally estimated, the net book values of the long-lived assets are depreciated over the newly determined remaining estimated useful lives. The Company considers the following to be some examples of important indicators that may trigger an impairment review: (i) significant under-performance or losses of assets relative to expected historical or projected future operating results; (ii) significant changes in the manner or use of assets or in the Company’s overall strategy with respect to the manner or use of the acquired assets or changes in the Company’s overall business strategy; (iii) significant negative industry or economic trends; (iv) increased competitive pressures; (v) a significant decline in the Company’s stock price for a sustained period of time; and (vi) regulatory changes. The Company evaluates acquired assets for potential impairment indicators at least annually and more frequently upon the occurrence of such events.
(iii)	Valuation allowance for deferred tax assets: Management assumes that the realization of the Company’s net deferred tax assets resulting from its net operating loss (“NOL”) carry–forwards for Federal income tax purposes that may be offset against future taxable income was not considered more likely than not and accordingly, the potential tax benefits of the net loss carry-forwards are offset by a full valuation allowance. Management made this assumption based on (a) the Company has incurred recurring losses, (b) general economic conditions, and (c) its ability to raise additional funds to support its daily operations by way of a public or private offering, among other factors.
(iv)	Estimates and assumptions used in valuation of equity instruments: Management estimates expected term of share options and similar instruments, expected volatility of the Company’s common shares and the method used to estimate it, expected annual rate of quarterly dividends, and risk free rate(s) to value share options and similar instruments.

These significant accounting estimates or assumptions bear the risk of change due to the fact that there are uncertainties attached to these estimates or assumptions, and certain estimates or assumptions are difficult to measure or value.

Management bases its estimates on historical experience and on various assumptions that are believed to be reasonable in relation to the financial statements taken as a whole under the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities that are not readily apparent from other sources.

Management regularly evaluates the key factors and assumptions used to develop the estimates utilizing currently available information, changes in facts and circumstances, historical experience and reasonable assumptions. After such evaluations, if deemed appropriate, those estimates are adjusted accordingly.

Actual results could differ from those estimates.

Principles of consolidation

Principles of consolidation

The Company consolidates all majority-owned subsidiaries, if any, in which the parent’s power to control exists.

As of June 30, 2018, the Company’s consolidated subsidiaries and/or entities are as follows:

Name of combined affiliate	State or other jurisdiction of incorporation or organization	Company interest
Jerrick Ventures LLC	The State of Delaware		100%
Jerrick Australia Pty Ltd	Australia		100%

All inter-company balances and transactions have been eliminated.

Jerrick Australia Pty Ltd does not have any operations.

Fair Value of Financial Instruments

Fair Value of Financial Instruments

The Company follows paragraph 825-10-50-10 of the FASB Accounting Standards Codification for disclosures about fair value of its financial instruments and paragraph 820-10-35-37 of the FASB Accounting Standards Codification (“Paragraph 820-10-35-37”) to measure the fair value of its financial instruments. Paragraph 820-10-35-37 establishes a framework for measuring fair value in U.S. GAAP, and expands disclosures about fair value measurements. To increase consistency and comparability in fair value measurements and related disclosures, Paragraph 820-10-35-37 establishes a fair value hierarchy which prioritizes the inputs to valuation techniques used to measure fair value into three (3) broad levels. The fair value hierarchy gives the highest priority to quoted prices (unadjusted) in active markets for identical assets or liabilities and the lowest priority to unobservable inputs. The three (3) levels of fair value hierarchy defined by Paragraph 820-10-35-37 are described below:

Level 1	Quoted market prices available in active markets for identical assets or liabilities as of the reporting date.
Level 2	Pricing inputs other than quoted prices in active markets included in Level 1, which are either directly or indirectly observable as of the reporting date.
Level 3	Pricing inputs that are generally observable inputs and not corroborated by market data.

Financial assets are considered Level 3 when their fair values are determined using pricing models, discounted cash flow methodologies or similar techniques and at least one significant model assumption or input is unobservable.

The fair value hierarchy gives the highest priority to quoted prices (unadjusted) in active markets for identical assets or liabilities and the lowest priority to unobservable inputs. If the inputs used to measure the financial assets and liabilities fall within more than one level described above, the categorization is based on the lowest level input that is significant to the fair value measurement of the instrument.

The carrying amount of the Company’s financial assets and liabilities, such as cash, prepaid expenses, accounts payable and accrued liabilities and accrued liquidating damages approximate their fair value because of the short maturity of those instruments. Transactions involving related parties cannot be presumed to be carried out on an arm’s-length basis, as the requisite conditions of competitive, free-market dealings may not exist. Representations about transactions with related parties, if made, shall not imply that the related party transactions were consummated on terms equivalent to those that prevail in arm’s-length transactions unless such representations can be substantiated.

Cash Equivalents

Cash Equivalents

The Company considers all highly liquid investments with a maturity of three months or less when purchased to be cash equivalents.

The Company minimizes its credit risk associated with cash by periodically evaluating the credit quality of its primary financial institution. The balance at times may exceed federally insured limits.

Property and Equipment

Property and Equipment

Property and equipment are recorded at cost. Expenditures for major additions and betterments are capitalized. Maintenance and repairs are charged to operations as incurred. Depreciation is computed by the straight-line method (after taking into account their respective estimated residual values) over the estimated useful lives of the respective assets as follows:

	Estimated Useful Life (Years)
Computer equipment and software		3
Furniture and fixture		5
Leasehold improvement		5

Upon sale or retirement of property and equipment, the related cost and accumulated depreciation are removed from the accounts and any gain or loss is reflected in the consolidated statements of operations.

Commitments and Contingencies

Commitments and Contingencies

The Company follows subtopic 450-20 of the FASB Accounting Standards Codification to report accounting for contingencies. Certain conditions may exist as of the date the condensed consolidated financial statements are issued, which may result in a loss to the Company, but which will only be resolved when one or more future events occur or fail to occur. The Company assesses such contingent liabilities, and such assessment inherently involves an exercise of judgment. In assessing loss contingencies related to legal proceedings that are pending against the Company or un-asserted claims that may result in such proceedings, the Company evaluates the perceived merits of any legal proceedings or un-asserted claims as well as the perceived merits of the amount of relief sought or expected to be sought therein.

If the assessment of a contingency indicates that it is probable that a material loss has been incurred and the amount of the liability can be estimated, then the estimated liability would be accrued in the Company’s consolidated financial statements. If the assessment indicates that a potential material loss contingency is not probable but is reasonably possible, or is probable but cannot be estimated, then the nature of the contingent liability, and an estimate of the range of possible losses, if determinable and material, would be disclosed.

Loss contingencies considered remote are generally not disclosed unless they involve guarantees, in which case the guarantees would be disclosed.

Derivative Liability

Derivative Liability

The Company adopted Section 815-40-15 of the FASB Accounting Standards Codification (“Section 815-40-15”) to determine whether an instrument (or an embedded feature) is indexed to the Company’s own stock. Section 815-40-15 provides that an entity should use a two-step approach to evaluate whether an equity-linked financial instrument (or embedded feature) is indexed to its own stock, including evaluating the instrument’s contingent exercise and settlement provisions.  The Company changed its method of accounting for the debt and warrants through the early adoption of ASU 2017-11 during the year ended December 31, 2017 on a retrospective basis.

Revenue Recognition

Revenue Recognition

The Company adopted ASC 606 effective January 1, 2018 using the modified retrospective method which would require a cumulative effect adjustment for initially applying the new revenue standard as an adjustment to the opening balance of retained earnings and the comparative information would not require to be restated and continue to be reported under the accounting standards in effect for those periods.

Based on the Company’s analysis the Company did not identify a cumulative effect adjustment for initially applying the new revenue standards. During the six months ended June 30, 2018 the Company recorded revenue from the following sources: products at auction, sponsored content and affiliate sites.

The adoption of ASC 606 represents a change in accounting principle that will more closely align revenue recognition with the delivery of the Company's services and will provide financial statement readers with enhanced disclosures. In accordance with ASC 606, revenue is recognized when a customer obtains control of promised services. The amount of revenue recognized reflects the consideration to which the Company expects to be entitled to receive in exchange for these services. To achieve this core principle, the Company applies the following five steps:

1) Identify the contract with a customer

A contract with a customer exists when (i) the Company enters into an enforceable contract with a customer that defines each party’s rights regarding the services to be transferred and identifies the payment terms related to these services, (ii) the contract has commercial substance and, (iii) the Company determines that collection of substantially all consideration for services that are transferred is probable based on the customer’s intent and ability to pay the promised consideration. The Company applies judgment in determining the customer’s ability and intention to pay, which is based on a variety of factors including the customer’s historical payment experience or, in the case of a new customer, published credit and financial information pertaining to the customer.

2) Identify the performance obligations in the contract

Performance obligations promised in a contract are identified based on the services that will be transferred to the customer that are both capable of being distinct, whereby the customer can benefit from the service either on its own or together with other resources that are readily available from third parties or from the Company, and are distinct in the context of the contract, whereby the transfer of the services is separately identifiable from other promises in the contract. To the extent a contract includes multiple promised services, the Company must apply judgment to determine whether promised services are capable of being distinct and distinct in the context of the contract. If these criteria are not met the promised services are accounted for as a combined performance obligation.

3) Determine the transaction price

The transaction price is determined based on the consideration to which the Company will be entitled in exchange for transferring services to the customer. To the extent the transaction price includes variable consideration, the Company estimates the amount of variable consideration that should be included in the transaction price utilizing either the expected value method or the most likely amount method depending on the nature of the variable consideration. Variable consideration is included in the transaction price if, in the Company’s judgment, it is probable that a significant future reversal of cumulative revenue under the contract will not occur. None of the Company's contracts as of June 30, 2018 contained a significant financing component. Determining the transaction price requires significant judgment, which is discussed by revenue category in further detail below.

4) Allocate the transaction price to performance obligations in the contract

If the contract contains a single performance obligation, the entire transaction price is allocated to the single performance obligation. However, if a series of distinct services that are substantially the same qualifies as a single performance obligation in a contract with variable consideration, the Company must determine if the variable consideration is attributable to the entire contract or to a specific part of the contract. For example, a bonus or penalty may be associated with one or more, but not all, distinct services promised in a series of distinct services that forms part of a single performance obligation. Contracts that contain multiple performance obligations require an allocation of the transaction price to each performance obligation based on a relative standalone selling price basis unless the transaction price is variable and meets the criteria to be allocated entirely to a performance obligation or to a distinct service that forms part of a single performance obligation. The Company determines standalone selling price based on the price at which the performance obligation is sold separately. If the standalone selling price is not observable through past transactions, the Company estimates the standalone selling price taking into account available information such as market conditions and internally approved pricing guidelines related to the performance obligations.

5) Recognize revenue when or as the Company satisfies a performance obligation

The Company satisfies performance obligations either over time or at a point in time. Revenue is recognized at the time the related performance obligation is satisfied by transferring a promised service to a customer.

Product revenue

Revenue from multiple-element arrangements is allocated among separate elements based on their estimated sales prices, provided the elements have value on a stand-alone basis.

Stock-Based Compensation

Stock-Based Compensation

The Company recognizes compensation expense for all equity–based payments granted to employees in accordance with ASC 718 “Compensation – Stock Compensation”. Under fair value recognition provisions, the Company recognizes equity–based compensation net of an estimated forfeiture rate and recognizes compensation cost only for those shares expected to vest over the requisite service period of the award. 

Restricted stock awards are granted at the discretion of the Company. These awards are restricted as to the transfer of ownership and generally vest over the requisite service periods, typically over a five-year period (vesting on a straight–line basis). The fair value of a stock award is equal to the fair market value of a share of Company stock on the grant date. 

The fair value of an option award is estimated on the date of grant using the Black–Scholes option valuation model. The Black–Scholes option valuation model requires the development of assumptions that are inputs into the model. These assumptions are the value of the underlying share, the expected stock volatility, the risk–free interest rate, the expected life of the option, the dividend yield on the underlying stock and the expected forfeiture rate. Expected volatility is benchmarked against similar companies in a similar industry over the expected option life and other appropriate factors. Risk–free interest rates are calculated based on continuously compounded risk–free rates for the appropriate term. The dividend yield is assumed to be zero as the Company has never paid or declared any cash dividends on its Common stock and does not intend to pay dividends on its Common stock in the foreseeable future. The expected forfeiture rate is estimated based on management’s best estimate.  

Determining the appropriate fair value model and calculating the fair value of equity–based payment awards requires the input of the subjective assumptions described above. The assumptions used in calculating the fair value of equity–based payment awards represent management’s best estimates, which involve inherent uncertainties and the application of management’s judgment. As a result, if factors change and the Company uses different assumptions, our equity–based compensation could be materially different in the future. In addition, the Company is required to estimate the expected forfeiture rate and recognize expense only for those shares expected to vest. If the Company’s actual forfeiture rate is materially different from its estimate, the equity–based compensation could be significantly different from what the Company has recorded in the current period.

The Company accounts for share–based payments granted to non–employees in accordance with ASC 505-40, “Equity Based Payments to Non–Employees”. The Company determines the fair value of the stock–based payment as either the fair value of the consideration received or the fair value of the equity instruments issued, whichever is more reliably measurable. If the fair value of the equity instruments issued is used, it is measured using the stock price and other measurement assumptions as of the earlier of either (1) the date at which a commitment for performance by the counterparty to earn the equity instruments is reached, or (2) the date at which the counterparty’s performance is complete. The fair value of the equity instruments is re-measured each reporting period over the requisite service period.

Income Taxes

Income Taxes

Income taxes are provided in accordance with ASC No. 740, “Accounting for Income Taxes”. A deferred tax asset or liability is recorded for all temporary differences between financial and tax reporting and net operating loss carryforwards. Deferred tax expense (benefit) results from the net change during the period of deferred tax assets and liabilities.

Deferred tax assets are reduced by a valuation allowance when, in the opinion of management, it is more likely than not that some portion or all of the deferred tax assets will not be realized. Deferred tax assets and liabilities are adjusted for the effects of changes in tax laws and rates on the date of enactment. 

Management makes judgments as to the interpretation of the tax laws that might be challenged upon an audit and cause changes to previous estimates of tax liability. In addition, the Company operates within multiple taxing jurisdictions and is subject to audit in these jurisdictions. In management’s opinion, adequate provisions for income taxes have been made for all years. If actual taxable income by tax jurisdiction varies from estimates, additional allowances or reversals of reserves may be necessary. 

Loss Per Share

Loss Per Share

Basic net loss per common share is computed by dividing net loss attributable to common stockholders by the weighted-average number of common shares outstanding during the period. Diluted net loss per common share is determined using the weighted-average number of common shares outstanding during the period, adjusted for the dilutive effect of common stock equivalents. In periods when losses are reported, which is the case for the six months ended June 30, 2018 and 2017 presented in these consolidated financial statements, the weighted-average number of common shares outstanding excludes common stock equivalents because their inclusion would be anti-dilutive.

The Company had the following common stock equivalents at June 30, 2018 and 2017:

	June 30, 2018		June 30, 2017
Series A Preferred stock		23,135,935		21,654,614
Series B Preferred stock		4,697,906		4,431,987
Options		17,649,990		17,549,990
Warrants		62,016,795		22,805,981
Convertible notes - related party		10,027,507		250,000
Convertible notes		28,015,838		2,929,127
Totals		145,543,971		69,621,699

Reclassifications

Reclassifications

Interest expense has been allocated to accretion of debt discount and issuance cost to conform to current period presentation.

Recently Adopted Accounting Guidance

Recently Adopted Accounting Guidance

In November 2016, the FASB issued ASU 2016-18, “Statement of Cash Flows (Topic 230)”, requiring that the statement of cash flows explain the change in the total cash, cash equivalents, and amounts generally described as restricted cash or restricted cash equivalents. This guidance is effective for fiscal years, and interim reporting periods therein, beginning after December 15, 2017 with early adoption permitted. The provisions of this guidance are to be applied using a retrospective approach which requires application of the guidance for all periods presented. The Company has adopted the methodologies prescribed by ASU 2016-18, the adoption of ASU 2016-18 did not have a material effect on its financial position or results of operations. 

In May 2017, the FASB issued ASU 2017-09, “Compensation—Stock Compensation (Topic 718): Scope of Modification Accounting,” which provides guidance about which changes to the terms or conditions of a share-based payment award require an entity to apply modification accounting in Topic 718. This standard is required to be adopted in the first quarter of 2018. The Company has adopted the methodologies prescribed by ASU 2017-09, the adoption of ASU 2017-09 did not have a material effect on its financial position or results of operations. 

In July 2017, the FASB issued ASU 2017-11, “Earnings Per Share (Topic 260), Distinguishing Liabilities from Equity (Topic 480) and Derivatives and Hedging (Topic 815): I. Accounting for Certain Financial Instruments with Down Round Features; II. Replacement of the Indefinite Deferral for Mandatorily Redeemable Financial Instruments of Certain Nonpublic Entities and Certain Mandatorily Redeemable Noncontrolling Interests with a Scope Exception”. Part I of this update addresses the complexity of accounting for certain financial instruments with down round features. Down round features are features of certain equity-linked instruments (or embedded features) that result in the strike price being reduced on the basis of the pricing of future equity offerings. Current accounting guidance creates cost and complexity for entities that issue financial instruments (such as warrants and convertible instruments) with down round features that require fair value measurement of the entire instrument or conversion option. Part II of this update addresses the difficulty of navigating Topic 480, Distinguishing Liabilities from Equity, because of the existence of extensive pending content in the FASB Accounting Standards Codification. This pending content is the result of the indefinite deferral of accounting requirements about mandatorily redeemable financial instruments of certain nonpublic entities and certain mandatorily redeemable noncontrolling interests. The amendments in Part II of this update do not have an accounting effect. This ASU is effective for fiscal years, and interim periods within those years, beginning after December 15, 2018. The Company early adopted the ASU 2017-11 in the year ending December 31, 2017. 

Adoption of ASU 2017-11

As noted above, in connection with the securities purchase agreement and debt transactions during the year ended December 31, 2017, the Company issued warrants and convertible notes, to purchase common stock with an exercise price of $0.20 and a five-year term. Upon issuance of the warrants and convertible notes, the Company evaluated the note agreement to determine if the agreement contained any embedded components that would qualify the agreement as a derivative. The Company identified certain put features embedded in the warrants and convertible notes that potentially could result in a net cash settlement in the event of a fundamental transaction, requiring the Company to classify the warrants and convertible notes as a derivative liability. The Company changed its method of accounting for the convertible notes and warrants through the early adoption of ASU 2017-11 during the three months ended December 31, 2017 on a retrospective basis. Accordingly, the Company recorded the warrant derivative and conversion option derivative liabilities to additional paid in capital upon issuance.

Tabular summaries of the revisions and the corresponding effects on the statement of earnings for the six months ended June 30, 2017 are presented below:

Consolidated Statement of Operations Six Months Ended June 30, 2017
	Previously  Reported			Revisions			Revised  Reported
Accretion of debt discount and issuance cost	$	(951,484	)	$	226,584		$	(724,900	)
Derivative expense		(254,470	)		254,470			-
Change in fair value of derivative liabilities		584,011			(584,011	)		-
Net loss	$	(2,852,952	)	$	102,957		$	(2,955,909	)
Net loss per ordinary share:
Basic and diluted loss per share	$	(0.08	)	$	(0.00	)	$	(0.08	)

Recent Accounting Guidance Not Yet Adopted

Recent Accounting Guidance Not Yet Adopted

In February 2016, the FASB issued ASU 2016-02, “Leases (Topic 842).” Under ASU 2016-02, lessees will be required to recognize, for all leases of 12 months or more, a liability to make lease payments and a right-of-use asset representing the right to use the underlying asset for the lease term. Additionally, the guidance requires improved disclosures to help users of financial statements better understand the nature of an entity’s leasing activities. This ASU is effective for public reporting companies for interim and annual periods beginning after December 15, 2018, with early adoption permitted, and must be adopted using a modified retrospective approach. The Company is in the process of evaluating the effect of the new guidance on its condensed consolidated financial statements and disclosures.

In October 2016, the FASB issued ASU 2016-16, “Income Taxes (Topic 740): Intra-Entity Transfers of Assets Other than Inventory”, which eliminates the exception that prohibits the recognition of current and deferred income tax effects for intra-entity transfers of assets other than inventory until the asset has been sold to an outside party. The updated guidance is effective for annual periods beginning after December 15, 2019, including interim periods within those fiscal years. Early adoption of the update is permitted. The Company is currently evaluating the impact of the new standard.

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

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Significant and Critical Accounting Policies and Practices (Tables)

6 Months Ended

Jun. 30, 2018

Significant and Critical Accounting Policies and Practices [Abstract]

Schedule of consolidated subsidiaries and/or entities

Name of combined affiliate	State or other jurisdiction of incorporation or organization	Company interest
Jerrick Ventures LLC	The State of Delaware		100%
Jerrick Australia Pty Ltd	Australia		100%

Schedule of property and equipment estimated useful life

	Estimated Useful Life (Years)
Computer equipment and software		3
Furniture and fixture		5
Leasehold improvement		5

Schedule of common stock equivalents

	June 30, 2018		June 30, 2017
Series A Preferred stock		23,135,935		21,654,614
Series B Preferred stock		4,697,906		4,431,987
Options		17,649,990		17,549,990
Warrants		62,016,795		22,805,981
Convertible notes - related party		10,027,507		250,000
Convertible notes		28,015,838		2,929,127
Totals		145,543,971		69,621,699

Summaries of the revisions and the corresponding effects on the consolidated statement of operations

Consolidated Statement of Operations Six Months Ended June 30, 2017
	Previously  Reported			Revisions			Revised  Reported
Accretion of debt discount and issuance cost	$	(951,484	)	$	226,584		$	(724,900	)
Derivative expense		(254,470	)		254,470			-
Change in fair value of derivative liabilities		584,011			(584,011	)		-
Net loss	$	(2,852,952	)	$	102,957		$	(2,955,909	)
Net loss per ordinary share:
Basic and diluted loss per share	$	(0.08	)	$	(0.00	)	$	(0.08	)

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Property and Equipment (Tables)

6 Months Ended

Jun. 30, 2018

Property and Equipment [Abstract]

Schedule of property and equipment

	June 30, 2018			December 31, 2017
Computer Equipment	$	234,315		$	234,315
Furniture and Fixtures		61,803			61,803
Leasehold Improvements		25,445			-
		321,563			296,118
Less: Accumulated Depreciation		(269,500	)		(248,062	)
	$	52,063		$	48,056

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Line of Credit (Tables)

6 Months Ended

Jun. 30, 2018

Line of Credit/Notes Payable/Convertible Note Payable [Abstract]

Schedule of line of credit

	Outstanding Balances as of
	June 30, 2018		December 31, 2017
Revolving Note		-		44,996
	$	-	$	44,996

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Notes Payable (Tables)

6 Months Ended

Jun. 30, 2018

Line of Credit/Notes Payable/Convertible Note Payable [Abstract]

Schedule of notes payable

	Outstanding Principal as of										Warrants
	June 30, 2018			December 31, 2017			Interest Rate			Maturity Date	Quantity		Exercise Price
The February 2017 Offering	$	364,325		$	400,000			12	%	September 1, 2017		2,450,000	$	0.20
The June 2017 Loan Agreement		-			50,000			12	%	September 1, 2017		35,000		0.20
The First November 2017 Loan Agreement		-			100,000			15	%	January 12, 2018		-		-
The Second November 2017 Loan Agreement		-			50,000			15	%	January 13, 2018		-		-
The Third November 2017 Loan Agreement		-			100,000			15	%	January 13, 2018		-		-
May 2018 Offering		608,500			-			13	%	March 2019		1,825,500		-
		972,825			700,000
Less: Debt Discount		(180,950	)		(10,500	)
Less: Debt Issuance Costs		(408	)		-
	$	791,467		$	689,500

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Convertible Note Payable (Tables)

6 Months Ended

Jun. 30, 2018

Line of Credit/Notes Payable/Convertible Note Payable [Abstract]

Schedule of convertible notes payable

	Outstanding Principal as of													Warrants
	June 30, 2018			December 31,  2017			Interest Rate			Conversion Price			Maturity Date	Quantity		Exercise Price
The November 2016 Convertible Note Offering	$	25,000		$	25,000			10	%		0.30		November 1, 2017		400,000	$	0.30
The June 2017 Convertible Note Offering		-			71,500			12	%		Not Applicable		September 1, 2017		114,700		0.20
The August 2017 Convertible Note Offering		2,943,884			2,943,884			15	%		0.20	(*)	August – November 2019		14,716,419		0.20
The First December 2017 Note		100,000			100,000			15	%		0.20	(*)	December 21, 2019		500,000		0.20
The February 2018 Convertible Note Offering		1,015,674			-			15	%		0.20	(*)	January – February 2020		5,078,375		0.20
The January 2018 Note		68,761			-						0.20	(*)	January 12, 2020		343,806		0.20
The February 2018 Note		35,452			-			18	%		0.20	(*)	February 8, 2020		81,500		0.20
The March 2018 Convertible Note Offering		961,367			-			14	%		0.20	(*)	March – April 2020		4,806,833		0.20
		5,150,138			3,140,384
Less: Debt Discount		(828,627	)		(452,022	)
Less: Debt Issuance Costs		(219,204	)		(79,569	)
		4,102,307			2,608,793
Less: Current Debt		(59,499	)		(96,500	)
Total Long-Term Debt	$	4,042,808		$	2,512,293

(*) As subject to adjustment as further outlined in the notes

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Related Party Loans (Tables)

6 Months Ended

Jun. 30, 2018

Related Party Loans [Abstract]

Schedule of convertible notes payable - related party

	Outstanding Principal as of										Warrants
	June 30, 2018			December 31, 2017			Interest Rate			Maturity Date	Quantity		Exercise Price
The August 2017 Convertible Note Offering	$	1,416,026		$	1,416,026			15	%	August – October 2019		4,589,466	$	0.20
The Second December 2017 Note		100,000			100,000			15	%	December 21, 2019		500,000		0.20
The February 2018 Convertible Note Offering		25,000			-			15	%	January – February 2020		125,000		0.20
The Second February 2018 Note		35,452			-			20	%	September 30, 2018		81,500		0.20
The March 2018 Convertible Note Offering		239,400			-			14	%	March 2020		1,197,000		0.20
		1,815,878			1,516,026
Less: Debt Discount		(208,525	)		(170,780	)
Less: Debt Issuance Costs		(4,645	)		-
		1,602,708			1,345,246
Less: Current Debt		(30,916	)		-
Total Long-Term Debt	$	1,571,792		$	1,345,246

Schedule of notes payable - related party

	Outstanding Principal as of									Warrants
	June 30, 2018			December 31, 2017		Interest Rate			Maturity Date	Quantity		Exercise Price
The May 2016 Rosen Loan Agreement	$	1,000,000		$	1,000,000		13	%	November 26, 2017		1,000,000	$	0.40
The September 2017 Rosen Loan Agreement		224,000			224,000		18	%	September 24, 2017		125,000		0.20
The November 2017 Schiller Loan Agreement		-			25,000		15	%	December 31, 2017		-		-
The May 2018 Schiller Loan Agreement		100,000			-		13	%	February 2, 2019		300,000		0.20
The June 2018 Frommer Loan Agreement		10,000			-		6	%	August 17, 2018		30,000		0.20
		1,334,000			1,249,000
Less: Current Debt		(28,093	)		-
	$	1,305,907		$	1,249,000

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Capital Leases Payable (Tables)

6 Months Ended

Jun. 30, 2018

Capital Leases Payable [Abstract]

Schedule of capital lease obligation

		June 30, 2018			December 31, 2017
(i)	Capital lease obligation to a financing company for a term of five (5) years, collateralized by equipment, with interest at 10.0% per annum, with principal and interest due and payable in monthly installments of $383.10	$	4,732		$	4,732
	Less current maturities		(4,732	)		(4,732	)
	Capital lease obligation, net of current maturities		-			-
	TOTAL CAPITAL LEASE OBLIGATION	$	4,732		$	4,732

Schedule of capital leases maturity

2018: $ 4,732 $ 4,732

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Stockholders' Deficit (Tables) - Warrants [Member]

6 Months Ended

Jun. 30, 2018

Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range [Line Items]

Summary of assumptions used for warrants granted

	June 30, 2018
Exercise price	$	0.20
Expected dividends		0	%
Expected volatility		92.14%-100.56%
Risk free interest rate		1.64%-2.69%
Expected life of warrant		4 - 5 years

Summary of warrant activity

	Warrants			Weighted Average Exercise Price
Outstanding – December 31, 2017		46,193,779		$	0.24
Granted		15,873,016			0.20
Exercised		(50,000	)		0.40
Forfeited/Cancelled		-			-
Outstanding and Exercisable – June 30, 2018		62,016,795		$	0.24

Summary of warrants outstanding and exercisable

Warrants Outstanding								Warrants Exercisable
Exercise price		Number Outstanding		Weighted Average Remaining Contractual Life (in years)		Weighted Average Exercise Price		Number Exercisable		Weighted Average Exercise Price
$	0.20		62,016,795		3.66		0.24		62,016,795		0.24

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Commitments and Contingencies (Tables)

6 Months Ended

Jun. 30, 2018

Commitments and Contingencies [Abstract]

Schedule of annual minimum lease payments under non-cancellable operating leases

2018	$	35,972
2019		74,204
2020		78,146
2021		82,207
2022		87,851
2023		37,775
Total minimum lease payments	$	396,155

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Revision of Prior Year Financial Statements (Tables)

6 Months Ended

Jun. 30, 2018

Revision of Prior Year Financial Statements [Abstract]

Schedule of correction of accounting errors, the relevant annual financial statements

	December 31, 2017
	As Previously Reported		Adjustment			As Revised
Balance Sheet
Current Liabilities
Accrued dividends	$	472,444	$	(472,444	)	$	-
Total Current Liabilities		4,159,644		(472,444	)		3,687,200
Total Liabilities	$	8,017,183	$	(472,444	)	$	7,544,739
Stockholders’ Equity
Total Stockholders’ Equity		7,839,751		(472,444	)		7,367,307

	For the six months ended June 30, 2017
	As Previously Reported			Adjustments		As Revised
Statement of Operations
Deemed dividend	$	-		$	131,867	$	131,867
Net loss attributable to common stockholders	$	2,955,909		$	131,867	$	3,087,776
Basic and diluted loss per share	$	(0.08	)	$	-		(0.08	)
Statements of Cash Flows
Supplementary Disclosure of Non-Cash Investing And Financing Activities
Deemed dividend	$	101,385		$	30,482	$	131,867

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Organization and Operations (Details)	Feb. 05, 2016 shares
Kent Campbell [Member]
Organization and Operations (Textual)
Issuance of common shares for cash	28,500,000
Cancelled of common stock	781,818
Jerrick Ventures, Inc. [Member] | Series A Convertible Preferred Stock [Member]
Organization and Operations (Textual)
Issuance of common shares for cash	33,415
Jerrick Ventures, Inc. [Member] | Series B Convertible Preferred Stock [Member]
Organization and Operations (Textual)
Issuance of common shares for cash	8,064

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Significant and Critical Accounting Policies and Practices (Details)	6 Months Ended
	Jun. 30, 2018
Jerrick Ventures LLC [Member]
Name of combined affiliate	Jerrick Ventures LLC
State or other jurisdiction of incorporation or organization	The State of Delaware
Company interest	100.00%
Jerrick Australia Pty Ltd [Member]
Name of combined affiliate	Jerrick Australia Pty Ltd
State or other jurisdiction of incorporation or organization	Australia
Company interest	100.00%

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Significant and Critical Accounting Policies and Practices (Details 1)	6 Months Ended
	Jun. 30, 2018
Computer equipment and software [Member]
Property and Equipment, Estimated Useful Life (Years)	3 years
Furniture and fixture [Member]
Property and Equipment, Estimated Useful Life (Years)	5 years
Leasehold improvement [Member]
Property and Equipment, Estimated Useful Life (Years)	5 years

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Significant and Critical Accounting Policies and Practices (Details 2) - shares	6 Months Ended
	Jun. 30, 2018	Jun. 30, 2017
Loss Per Share [Line Items]
Common stock equivalents, total	145,543,971	69,621,699
Series A Preferred stock [Member]
Loss Per Share [Line Items]
Common stock equivalents, total	23,135,935	21,654,614
Series B Preferred stock [Member]
Loss Per Share [Line Items]
Common stock equivalents, total	4,697,906	4,431,987
Convertible notes [Member]
Loss Per Share [Line Items]
Common stock equivalents, total	28,015,838	2,929,127
Convertible notes - related party [Member]
Loss Per Share [Line Items]
Common stock equivalents, total	10,027,507	250,000
Options [Member]
Loss Per Share [Line Items]
Common stock equivalents, total	17,649,990	17,549,990
Warrants [Member]
Loss Per Share [Line Items]
Common stock equivalents, total	62,016,795	22,805,981

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Significant and Critical Accounting Policies and Practices (Details 3) - USD ($)	3 Months Ended		6 Months Ended
	Jun. 30, 2018	Jun. 30, 2017	Jun. 30, 2018	Jun. 30, 2017
Accretion of debt discount and issuance cost	$ (415,045)	$ (431,720)	$ (589,933)	$ (724,900)
Derivative expense
Change in fair value of derivative liabilities
Net loss	$ (2,411,238)	$ (1,466,657)	$ (4,504,868)	$ (2,955,909)
Net loss per ordinary share:
Basic and diluted loss per share	$ (0.06)	$ (0.04)	$ (0.12)	$ (0.08)
Previously Reported [Member]
Accretion of debt discount and issuance cost				$ (951,484)
Derivative expense				(254,470)
Change in fair value of derivative liabilities				584,011
Net loss				$ (2,852,952)
Net loss per ordinary share:
Basic and diluted loss per share				$ (0.08)
Revisions [Member]
Accretion of debt discount and issuance cost				$ 226,584
Derivative expense				254,470
Change in fair value of derivative liabilities				(584,011)
Net loss				$ 102,957
Net loss per ordinary share:
Basic and diluted loss per share				$ 0.00

XML

Significant and Critical Accounting Policies and Practices (Details Textual) - Securities purchase agreement [Member]	12 Months Ended
	Dec. 31, 2017 $ / shares
Significant and Critical Accounting Policies and Practices (Textual)
Stock options exercisable term	5 years
Stock options to purchase of common stock exercise price per share	$ 0.20

XML

Property and Equipment (Details) - USD ($)	Jun. 30, 2018	Dec. 31, 2017
Property, Plant and Equipment [Line Items]
Property and equipment, gross	$ 321,563	$ 296,118
Less: Accumulated Depreciation	(269,500)	(248,062)
Property and equipment, net	52,063	48,056
Computer Equipment [Member]
Property, Plant and Equipment [Line Items]
Property and equipment, gross	234,315	234,315
Furniture and Fixtures [Member]
Property, Plant and Equipment [Line Items]
Property and equipment, gross	61,803	61,083
Leasehold Improvements [Member]
Property, Plant and Equipment [Line Items]
Property and equipment, gross	$ 25,445

XML

Property and Equipment (Details Textual) - USD ($)	3 Months Ended		6 Months Ended
	Jun. 30, 2018	Jun. 30, 2017	Jun. 30, 2018	Jun. 30, 2017
Property and Equipment (Textual)
Depreciation	$ 10,423	$ 9,404	$ 21,439	$ 18,704

XML

Line of Credit (Details) - USD ($)	Jun. 30, 2018	Dec. 31, 2017
Line of Credit Facility [Line Items]
Line of credit		$ 44,996
Revolving Note [Member]
Line of Credit Facility [Line Items]
Line of credit	$ 0	$ 44,996

XML

Line of Credit (Details Textual) - USD ($)	1 Months Ended
	Mar. 19, 2009	Jun. 30, 2018	Dec. 31, 2017
Line of Credit (Textual)
Line of credit			$ 44,996
Revolving Note [Member]
Line of Credit (Textual)
Line of credit maximum outstanding balance	$ 200,000
Line of credit facility, expiration date	Mar. 19, 2010
Line of credit		$ 0	$ 44,996

XML

Notes Payable (Details) - USD ($)	6 Months Ended
	Jun. 30, 2018	Dec. 31, 2017
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Note payable, Outstanding Principal	$ 791,467	$ 689,500
Less: Debt Discount	(180,950)	(10,500)
Less: Debt Issuance Costs	(408)
Notes Payable	791,467	689,500
The February 2017 Offering [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Note payable, Outstanding Principal	$ 364,325	400,000
Interest Rate	12.00%
Maturity date	Sep. 01, 2017
Warrants, Quantity	2,450,000
Warrants, Exercise Price	$ 0.20
The June 2017 Loan Agreement [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Note payable, Outstanding Principal		50,000
Interest Rate	12.00%
Maturity date	Sep. 01, 2017
Warrants, Quantity	35,000
Warrants, Exercise Price	$ 0.20
The First November 2017 Loan Agreement [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Note payable, Outstanding Principal		100,000
Interest Rate	15.00%
Maturity date	Jan. 12, 2018
Warrants, Quantity
Warrants, Exercise Price
The Second November 2017 Loan Agreement [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Note payable, Outstanding Principal		50,000
Interest Rate	15.00%
Maturity date	Jan. 13, 2018
Warrants, Quantity
Warrants, Exercise Price
The Third November 2017 Loan Agreement [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Note payable, Outstanding Principal		100,000
Interest Rate	15.00%
Maturity date	Jan. 13, 2018
Warrants, Quantity
Warrants, Exercise Price
May 2018 Offering [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Note payable, Outstanding Principal	$ 608,500
Interest Rate	13.00%
Maturity date	Mar. 31, 2019
Warrants, Quantity	1,825,500
Warrants, Exercise Price

XML

Notes Payable (Details Textual) - USD ($)			1 Months Ended					6 Months Ended
	Mar. 14, 2018	Jun. 12, 2017	May 31, 2018	Nov. 29, 2017	Nov. 28, 2017	Mar. 17, 2017	Feb. 28, 2017	Jun. 30, 2018	Dec. 31, 2017	Nov. 30, 2017
Notes Payable (Textual)
Debt discount								$ 180,950	$ 10,500
May 2018 Offering [Member]
Notes Payable (Textual)
Maturity date								Mar. 31, 2019
Interest rate								13.00%
Warrants purchase of common stock								1,825,500
Warrant exercisable price, per share
Subscription Agreements [Member] | May 2018 Offering [Member]
Notes Payable (Textual)
Interest rate			13.00%
Warrant exercisable price, per share			$ 0.20
Warrant term			4 years
Aggregate principal amount			$ 1,200,000
Aggregate gross proceeds of common stock			$ 658,500					$ 658,500
Notes conversion, description			The Company's securities (each, a "Unit" and collectively, the "Units"), with each Unit consisting of (i) a 13% promissory note (each, a " May 2018 Offering Note" and, together, the "May 2018 Offering Notes"), and (ii) a four-year warrant ("May 2018 Offering Warrant") to purchase the number of shares of the Company's common stock equal to three times the principal amount in dollars invested by such investor in each May 2018 Offering Note (the "May 2018 Warrant Shares") at an exercise price of $0.20 per share (the "May Offering Warrant Exercise Price"), subject to adjustment upon the terms thereof.
Debt discount								215,032
Private Placement Offerings [Member] | Subscription Agreements [Member]
Notes Payable (Textual)
Interest rate						6.00%
Aggregate principal amount						$ 975,511
Aggregate gross proceeds of common stock						$ 916,585
Loan Agreement [Member]
Notes Payable (Textual)
Promissory note		$ 50,000
Maturity date		Sep. 01, 2017
Interest rate		10.00%
Warrants purchase of common stock		35,000
Warrant exercisable price, per share		$ 0.20
Warrant term		5 years
Repayment of principal								50,000
Gain on forgiveness of debt								$ 4,424
August 2017 Convertible Note Offering [Member]
Notes Payable (Textual)
Promissory note										$ 1,585,000
February 2017 Offering Note [Member]
Notes Payable (Textual)
Interest rate							15.00%
Warrant exercisable price, per share							$ 0.20	$ 0.20
Aggregate principal amount							$ 575,511
Aggregate gross proceeds of common stock								$ 400,000
Notes conversion, description							The remaining investors representing an aggregate $400,000 in principal of the February 2017 Offering Notes agreed to forbear their right to declare an event of default until December 15, 2017 during which time they retain the right to convert their principal and any accrued but unpaid interest into the August 2017 Convertible Note Offering. In consideration of the forbearance for which the investors will receive a warrant to purchase up to fifteen percent (15%) of the shares of common stock underlying the warrant acquired with the purchase of the February 2017 Offering Notes at a purchase price of $0.20 per share, and the interest on their note would be increased to eighteen percent (18%) from September 1, 2017 through December 15, 2017 or the conversion date, whichever is sooner.	The February 2017 Offering Notes are convertible into shares of the Company's common stock at the time of Company's next round of financing (the "Subsequent Offering") at a price equal to eighty-five percent (85%) of the price per share offered in the Subsequent Offering (the "Conversion Price"). The February 2017 Offering Warrants have a five-year term. Investors received the February 2017 Offering Warrants in the following amounts: (i) Investors purchasing $150,000 or more of the Offering received a February 2017 Offering Warrant equal to one hundred thirty percent (130%) of the dollar amount invested in the Offering; (ii) investors purchasing at least $100,000 but less than $150,000 of the February 2017 Offering received a February 2017 Offering Warrant equal to one hundred percent (100%) of the dollar amount invested in the Offering; and (iii) investors purchasing less than $100,000 of the Offering received to a February 2017 Offering Warrant equal to seventy percent (70%) of the dollar amount invested in the Offering.
Interest paid								$ 26,375
Repayment of principal								$ 26,500
First November 2017 Loan Agreement [Member]
Notes Payable (Textual)
Promissory note					$ 100,000
Notes conversion, description					The First November 2017 Lender issued the Company a promissory note of $100,000 (the "First November 2017 Note"). Pursuant to the First November 2017 Loan Agreement, the First November 2017 Note has interest of fifteen percent (15%), (i) five percent (5%) (i.e. $5,000) shall be payable in cash or convertible into shares of the Company's restricted common stock at a rate of $0.20 per share, at the option of the Lender, at the Maturity Date; (ii) ten percent (10%) (i.e. $10,000) shall be paid in the form of the Company's restricted common stock at a rate of $0.20 per share (equivalent to 50,000 shares of the Company's common stock ). The maturity date of the First November 2017 Note was January 12, 2018 (the "First November 2017 Maturity Date") at which time all outstanding principal, accrued and unpaid interest and other amounts due under the First November 2017 Note are due.
Second November 2017 Loan Agreement [Member]
Notes Payable (Textual)
Promissory note				$ 50,000
Notes conversion, description				The Second November 2017 Loan Agreement, the Second November 2017 Note has interest of fifteen percent (15%), (i) five percent (5%) (i.e. $2,500) shall be payable in cash or convertible into shares of the Company's restricted common stock at a rate of $0.20 per share, at the option of the Lender, at the Maturity Date; (ii) ten percent (10%) (i.e. $5,000) shall be paid in the form of the Company's restricted common stock at a rate of $0.20 per share (equivalent to 25,000 shares of the Company's common stock ). The maturity date of the Second November 2017 Note was January 13, 2018 (the "Second November 2017 Maturity Date") at which time all outstanding principal, accrued and unpaid interest and other amounts due under the Second November 2017 Note are due.
Third November 2017 Loan Agreement [Member]
Notes Payable (Textual)
Promissory note				$ 100,000
Notes conversion, description				The Third November 2017 Loan Agreement, the Third November 2017 Note has interest of fifteen percent (15%), (i) five percent (5%) (i.e. $5,000) shall be payable in cash or convertible into shares of the Company's restricted common stock at a rate of $0.20 per share, at the option of the Lender, at the Maturity Date; (ii) ten percent (10%) (i.e. $10,000) shall be paid in the form of the Company's restricted common stock at a rate of $0.20 per share (equivalent to 50,000 shares of the Company's common stock). The maturity date of the Third November 2017 Note was January 13, 2018 (the "Third November 2017 Maturity Date") at which time all outstanding principal, accrued and unpaid interest and other amounts due under the Third November 2017 Note are due.
March 2018 Loan Agreement [Member]
Notes Payable (Textual)
Promissory note	$ 50,000
Maturity date	Mar. 29, 2018
Interest rate	12.00%
Warrants purchase of common stock	100,000
Warrant exercisable price, per share	$ 0.20
Warrant term	5 years

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Convertible Note Payable (Details) - USD ($)		6 Months Ended
		Jun. 30, 2018	Dec. 31, 2017
Short-term Debt [Line Items]
Outstanding Principal		$ 5,150,138	$ 3,140,384
Less: Debt Discount		(828,627)	(452,022)
Less: Debt Issuance Costs		(219,204)	(79,569)
Total		4,102,307	2,608,793
Less: Current Debt		(59,500)	(96,500)
Total Long-Term Debt		4,042,808	2,512,293
The November 2016 Convertible Note Offering [Member]
Short-term Debt [Line Items]
Outstanding Principal		$ 25,000	25,000
Interest Rate		10.00%
Conversion Price		$ 0.30
Maturity Date		Nov. 01, 2017
Warrants, Quantity		400,000
Warrants, Exercise Price		$ 0.30
The June, 2017 Convertible Note Offering [Member]
Short-term Debt [Line Items]
Outstanding Principal			71,500
Interest Rate		12.00%
Conversion Price, description		Not Applicable
Maturity Date		Sep. 01, 2017
Warrants, Quantity		114,700
Warrants, Exercise Price		$ 0.20
The August Convertible Note Offering [Member]
Short-term Debt [Line Items]
Outstanding Principal		$ 2,943,884	2,943,884
Interest Rate		15.00%
Conversion Price	[1]	$ 0.20
Warrants, Quantity		14,716,419
Warrants, Exercise Price		$ 0.20
The August Convertible Note Offering [Member] | Minimum [Member]
Short-term Debt [Line Items]
Maturity Date		Aug. 31, 2019
The August Convertible Note Offering [Member] | Maximum [Member]
Short-term Debt [Line Items]
Maturity Date		Nov. 30, 2019
The First December 2017 Note [Member]
Short-term Debt [Line Items]
Outstanding Principal		$ 100,000	100,000
Interest Rate		15.00%
Conversion Price	[1]	$ 0.20
Maturity Date		Dec. 21, 2019
Warrants, Quantity		500,000.00
Warrants, Exercise Price		$ 0.20
The February 2018 Convertible Note Offering [Member]
Short-term Debt [Line Items]
Outstanding Principal		$ 1,015,674
Interest Rate		15.00%
Conversion Price	[1]	$ 0.20
Warrants, Quantity		5,078,375
Warrants, Exercise Price		$ 0.20
The February 2018 Convertible Note Offering [Member] | Minimum [Member]
Short-term Debt [Line Items]
Maturity Date		Jan. 31, 2020
The February 2018 Convertible Note Offering [Member] | Maximum [Member]
Short-term Debt [Line Items]
Maturity Date		Feb. 29, 2020
The January 2018 Note [Member]
Short-term Debt [Line Items]
Outstanding Principal		$ 68,761
Conversion Price	[1]	$ 0.20
Maturity Date		Jan. 12, 2020
Warrants, Quantity		343,806
Warrants, Exercise Price		$ 0.20
The February 2018 Note [Member]
Short-term Debt [Line Items]
Outstanding Principal		$ 35,452
Interest Rate		18.00%
Conversion Price	[1]	$ 0.20
Maturity Date		Feb. 08, 2020
Warrants, Quantity		81,500
Warrants, Exercise Price		$ 0.20
The March 2018 Convertible Note Offering [Member]
Short-term Debt [Line Items]
Outstanding Principal		$ 961,367
Interest Rate		14.00%
Conversion Price	[1]	$ 0.20
Maturity Date		Mar. 31, 2020
Warrants, Quantity		4,806,333
Warrants, Exercise Price		$ 0.20
The March 2018 Convertible Note Offering [Member] | Minimum [Member]
Short-term Debt [Line Items]
Maturity Date		Mar. 31, 2020
The March 2018 Convertible Note Offering [Member] | Maximum [Member]
Short-term Debt [Line Items]
Maturity Date		Apr. 30, 2020

[1] As subject to adjustment as further outlined in the notes

XML

Convertible Note Payable (Details Textual) - USD ($)				1 Months Ended	4 Months Ended	6 Months Ended		12 Months Ended
	Feb. 08, 2018	Jan. 12, 2018	Jun. 30, 2017	Dec. 27, 2017	Nov. 30, 2017	Jun. 30, 2018	Jun. 30, 2017	Dec. 31, 2017	Dec. 31, 2016	Dec. 31, 2018
Convertible Note Payable (Textual)
Convertible notes payable outstanding balance						$ 5,150,138		$ 3,140,384
Debt discount						828,627		452,022
Debt issuance costs						(408)
Proceeds from issuance of convertible notes						299,852	$ 50,000
Placement fees						90,508
Derivative liability
Convertible Note to Third Party Lender [Member]
Convertible Note Payable (Textual)
Convertible note			$ 71,500				$ 71,500		$ 400,000
Note accrues interest rate			12.00%				12.00%		10.00%
Maturity date			Sep. 01, 2017						Dec. 29, 2017
Warrant term			5 years						5 years
Issuance of warrants			67,550						400,000
Warrants, exercise price			$ 0.20				$ 0.20		$ 0.30
Principal amount of convertible notes									$ 375,000
Interest amount of convertible notes									$ 30,719
Offering discount percentage			15.00%
Convertible Note to Third Party Lender [Member] | Subsequent Event [Member]
Convertible Note Payable (Textual)
Current default principal amount										$ 71,500
August 2017 Convertible Note Offering [Member]
Convertible Note Payable (Textual)
Debt issuance costs					$ 101,561
Issuance of warrants					6,791,419			4,555,129
Interest amount of convertible notes					$ 40,146
Conversion feature of debt instrument					583,681
Fair value derivative liability								$ 440,157
Secured debt					$ 1,217,177
Convertible secured promissory note, description					The August 2017 Convertible Note Offering consisted of a maximum of $6,000,000 of units of the Company's securities (each, a "Unit" and collectively, the "Units"), with each Unit consisting of (a) a 15% Convertible Secured Promissory Note (each a "August 2017 Offering Note" and together the "August 2017 Offering Notes"), convertible into shares of the Company's common stock, par value $.001 per share ("August 2017 Offering Conversion Shares") at a conversion price of $0.20 per share (the "August 2017 Note Conversion Price"), and (b) a five-year warrant (each a "August 2017 Offering Warrant and together the "August 2017 Offering Warrants") to purchase common stock equal to one hundred percent (100%) of the shares into which the August 2017 Offering Notes can be converted into ("August 2017 Offering Warrant Shares") at an exercise price of $0.20 per share ("August 2017 Offering Warrant Exercise Price"). The August 2017 Offering Notes mature on the second (2nd) anniversary of their issuance dates.
Aggregate principal amount					$ 1,585,000
August 2017 Convertible Note Offering [Member] | Warrants [Member]
Convertible Note Payable (Textual)
Debt discount						$ 472,675
Issuance of warrants						7,925,000
February 2018 Convertible Note Offering [Member]
Convertible Note Payable (Textual)
Convertible note	$ 40,750
Note accrues interest rate	18.00%
Maturity date	Feb. 08, 2020
Conversion price per share	$ 0.20
Aggregate gross proceeds						$ 725,000
Warrant term	5 years
Repayment of principal						$ 5,298
Debt discount	$ 7,963
Issuance of warrants	81,500					1,453,375
Warrants, exercise price	$ 0.20
Interest amount of convertible notes						$ 40,675
Conversion feature of debt instrument	$ 5,298					37,350
Placement fees						$ 94,250
Convertible redeemable debentures, percentage						13.00%
Fair value derivative liability						$ 181,139
Secured debt						$ 250,000
Convertible secured promissory note, description						A maximum of $750,000 of units of the Company's securities (each, a "Unit" and collectively, the "Units"), with each Unit consisting of (a) a 15% Convertible Secured Promissory Note (each a "February 2018 Convertible Note" and together the "February 2018 Convertible Notes"), convertible into shares of the Company's common stock, par value $.001 per share ("February 2018 Conversion Shares") at a conversion price of $0.20 per share (the "February 2018 Note Conversion Price"), and (b) a five-year warrant (each a "February 2018 Offering Warrant and together the "February 2018 Offering Warrants") to purchase common stock equal to one hundred percent (100%) of the shares into which the February 2018 Convertible Notes can be converted into ("February 2018 Warrant Shares") at an exercise price of $0.20 per share ("February 2018 Warrant Exercise Price"). The February 2018 Offering Notes mature on the second (2nd) anniversary of their issuance dates. The February 2018 Offering Notes are secured by a second priority security interest in the Company's assets up to $1,000,000.
Conversion shares						362,500
Conversion shares fair value						$ 74,881
February 2018 Convertible Note Offering [Member] | Warrants [Member]
Convertible Note Payable (Textual)
Debt discount						$ 316,875
Issuance of warrants						3,625,000
March 2018 Convertible Note Offering [Member]
Convertible Note Payable (Textual)
Aggregate gross proceeds						$ 770,000
Issuance of warrants						956,833
Interest amount of convertible notes						$ 767
Fair value derivative liability						84,087
Secured debt						$ 50,000
Convertible secured promissory note, description						A maximum of $900,000, with an over-allotment option of an additional $300,000 of units of the Company's securities (each, a "Unit" and collectively, the "Units"), with each Unit consisting of (a) a 14% Convertible Secured Promissory Note (each a "Note" and together the "Notes"), convertible into shares of the Company's common stock, par value $.001 per share ("Conversion Shares") at a conversion price of $0.20 per share (the "Conversion Price"), and (b) a four-year warrant (each a "Warrant and together the "Warrants") to purchase common stock equal to one hundred percent (100%) of the shares into which the Notes can be converted into ("Warrant Shares") at an exercise price of $0.20 per share ("Exercise Price"). The Notes mature on the second (2nd) anniversary of their issuance dates.
Unpaid interest						$ 140,600
March 2018 Convertible Note Offering [Member] | Warrants [Member]
Convertible Note Payable (Textual)
Debt discount						$ 254,788
Issuance of warrants						4,806,833
First December 2017 Note [Member]
Convertible Note Payable (Textual)
Convertible note				$ 100,000
Note accrues interest rate				15.00%
Maturity date				Dec. 27, 2019
Conversion price per share				$ 0.20
Warrant term				5 years
Debt discount				$ 35,525
Warrants issued to purchase shares				500,000
Warrants, exercise price				$ 0.20
January 2018 Note [Member]
Convertible Note Payable (Textual)
Convertible note		$ 68,761
Note accrues interest rate		15.00%
Maturity date		Jan. 12, 2020
Conversion price per share		$ 0.20
Warrant term		5 years
Issuance of warrants		343,806
Fair value derivative liability		$ 42,850
Convertible secured promissory note, description		The Company issued a convertible note to a third party lender totaling $68,761 to settle an outstanding vendor liabilities (the "January 2018 Note"). The January 2018 Note accrues interest at 15% per annum and matures with interest and principal both due on January 12, 2020. The conversions resulted in the issuance of 343,806 warrants with a fair value of $42,850. These were recorded as a loss on extinguishment of debt. The warrant entitles the holder to purchase the Company's common stock at a purchase price of $0.20 per share for a period of five years from the issue date. The January 2018 Note and accrued interest is convertible at a conversion price of $0.20 per share, subject to adjustment.

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Related Party Loans (Details) - USD ($)	6 Months Ended
	Jun. 30, 2018	Dec. 31, 2017
Related Party Transaction [Line Items]
Convertible notes payable - related parties, gross	$ (1,815,878)	$ 1,516,026
Less: Debt Discount	(208,525)	(170,780)
Less: Debt Issuance Costs	(4,645)
Convertible notes unamortized discount premium and debt issuance cost	1,602,708	1,345,246
Less: Current Debt	(30,916)
Total Long-Term Debt	1,571,792	1,345,246
The August 2017 Convertible Note Offering [Member]
Related Party Transaction [Line Items]
Convertible notes payable - related parties, gross	$ 1,416,026	1,416,026
Interest Rate	15.00%
Maturity Date, description	August - October 2019
Warrants, Quantity	4,589,466
Warrants, Exercise Price	$ 0.20
Second December 2017 Note [Member]
Related Party Transaction [Line Items]
Convertible notes payable - related parties, gross	$ 100,000	100,000
Interest Rate	15.00%
Maturity Date, description	December 21, 2019
Warrants, Quantity	500,000
Warrants, Exercise Price	$ 0.20
The February 2018 Convertible Note Offering [Member]
Related Party Transaction [Line Items]
Convertible notes payable - related parties, gross	$ 25,000
Interest Rate	15.00%
Maturity Date, description	January - February 2020
Warrants, Quantity	125,000
Warrants, Exercise Price	$ 0.20
The Second February 2018 Note [Member]
Related Party Transaction [Line Items]
Convertible notes payable - related parties, gross	$ 35,452
Interest Rate	20.00%
Maturity Date, description	September 30, 2018
Warrants, Quantity	81,500
Warrants, Exercise Price	$ 0.20
The March 2018 Convertible Note Offering [Member]
Related Party Transaction [Line Items]
Convertible notes payable - related parties, gross	$ 239,400
Interest Rate	14.00%
Maturity Date, description	March 2020
Warrants, Quantity	1,197,000
Warrants, Exercise Price	$ 0.20

XML

Related Party Loans (Details 1) - USD ($)	6 Months Ended
	Jun. 30, 2018	Dec. 31, 2017
Related Party Transaction [Line Items]
Notes payable - related party, gross	$ 1,334,000	$ 1,249,000
Less: Current Debt	(28,093)
Notes payable - related party, net	1,305,907	1,249,000
The May 2016 Rosen Loan Agreement [Member]
Related Party Transaction [Line Items]
Notes payable - related party, net	$ 1,000,000	1,000,000
Interest Rate	13.00%
Maturity Date	Nov. 26, 2017
Warrants, Quantity	1,000,000
Warrants, Exercise Price	$ 0.40
The September 2017 Rosen Loan Agreement [Member]
Related Party Transaction [Line Items]
Notes payable - related party, net	$ 224,000	224,000
Interest Rate	18.00%
Maturity Date	Sep. 24, 2017
Warrants, Quantity	125,000
Warrants, Exercise Price	$ 0.20
The November 2017 Schiller Loan Agreement [Member]
Related Party Transaction [Line Items]
Notes payable - related party, net		25,000
Interest Rate	15.00%
Maturity Date	Dec. 31, 2017
Warrants, Quantity
Warrants, Exercise Price
The May 2018 Schiller Loan Agreement [Member]
Related Party Transaction [Line Items]
Notes payable - related party, net	$ 100,000
Interest Rate	13.00%
Maturity Date	Feb. 02, 2019
Warrants, Quantity	300,000
Warrants, Exercise Price	$ 0.20
The June 2018 Frommer Loan Agreement [Member]
Related Party Transaction [Line Items]
Notes payable - related party, net	$ 10,000
Interest Rate	6.00%
Maturity Date	Aug. 17, 2018
Warrants, Quantity	30,000
Warrants, Exercise Price	$ 0.20

XML

Related Party Loans (Details Textual) - USD ($)										1 Months Ended					6 Months Ended		12 Months Ended
	May 02, 2018	Mar. 13, 2018	Mar. 09, 2018	Mar. 04, 2018	Feb. 08, 2018	Nov. 13, 2017	Sep. 08, 2017	Sep. 07, 2017	May 09, 2017	Jun. 29, 2018	Feb. 20, 2018	Jan. 16, 2018	Dec. 21, 2017	May 26, 2016	Jun. 30, 2018	Jun. 30, 2017	Dec. 31, 2017	Nov. 20, 2017
Related Party Loan (Textual)
Repaid principal															$ 85,675
Line of Credit [Member]
Related Party Loan (Textual)
Revolving line of credit									$ 130,000
LOC bears interest rate									18.00%
Total outstanding balance of line of credit - related party															$ 130,000
Revolving Line of Credit's maturity date									Jun. 01, 2019
February 2018 Convertible Note Offering [Member]
Related Party Loan (Textual)
Convertible secured promissory note, description															The Notes are secured by a second priority security interest in the Company's assets up to $1,000,000.
Placement agent cash fee															$ 3,250
Notes conversion, description															The Placement Agent shares of the Company's common stock equal to ten percent (10%) of the Conversion Shares underlying the Notes or 12,500 shares that had a fair value of $2,606, which was recorded as issuance cost and is being accreted over the life of the note to accretion of debt discount and issuance cost.
March 2018 Convertible Note Offering [Member] | Over-Allotment Option [Member]
Related Party Loan (Textual)
Units of securities															$ 300,000
Convertible secured promissory note, description															The Company's securities (each, a "Unit" and collectively, the "Units"), with each Unit consisting of (a) a 14% Convertible Secured Promissory Note (each a "Note" and together the "Notes"), convertible into shares of the Company's common stock, par value $.001 per share ("Conversion Shares") at a conversion price of $0.20 per share (the "Conversion Price"), and (b) a four-year warrant (each a "Warrant and together the "Warrants") to purchase common stock equal to one hundred percent (100%) of the shares into which the Notes can be converted into ("Warrant Shares") at an exercise price of $0.20 per share ("Exercise Price").
Maturity date, description															The Notes mature on the second (2nd) anniversary of their issuance dates.
Convertible note															$ 900,000
May 2016 Rosen Loan Agreement [Member]
Related Party Loan (Textual)
Unpaid interest								$ 150,128
Maturity date, description														Payable on the maturity date of May 26, 2017 (the "May 2016 Rosen Maturity Date") at which time all outstanding principal, accrued and unpaid interest and other amounts due under the May 2016 Rosen Loan are due.
Warrants, exercise price														$ 0.40
Warrant term														5 years
Interest rate														12.50%
Interest and principal both due date														Nov. 26, 2017
Warrants issued to purchase shares														1,000,000
Secured term loan														$ 1,000,000
September 2017 Rosen Loan Agreement [Member]
Related Party Loan (Textual)
Loss on extinguishment of debt											$ 65,378
Warrants, exercise price						$ 0.20	$ 0.20				$ 0.20
Warrant term						5 years	5 years				5 years
Interest and principal both due date											Sep. 08, 2018
Warrants issued to purchase shares						100,000	25,000				448,000
Promissory note							$ 224,000
November 2017 Schiller Loan Agreement [Member]
Related Party Loan (Textual)
Interest rate																		15.00%
Promissory note																		$ 25,000
Repaid principal															25,000
Repaid of interest															637
January 2018 Rosen Loan Agreement [Member]
Related Party Loan (Textual)
Convertible secured promissory note, description												The January 2018 Rosen Note is secured by an officer of the Company whereas upon default an officer of the company owes default shares to the lender equal to the amount of principal outstanding divided by 0.20.
Interest rate												6.00%
Interest and principal both due date												Jan. 31, 2018
Promissory note												$ 60,000
Repaid principal															60,000
Repaid of interest															200
January 2018 Gordon Loan Agreement [Member]
Related Party Loan (Textual)
Convertible secured promissory note, description												The January 2018 Gordon Note is secured by an officer of the Company whereas upon default an officer of the company owes default shares to the lender equal to the amount of principal outstanding divided by 0.20.
Interest rate												6.00%
Interest and principal both due date												Jan. 31, 2018
Promissory note												$ 40,000
Repaid principal															40,000
Repaid of interest															105
First March 2018 Rosen Loan Agreement [Member]
Related Party Loan (Textual)
Warrants, exercise price				$ 0.20
Warrant term				5 years
Interest rate				12.00%
Interest and principal both due date				Mar. 19, 2018
Warrants issued to purchase shares				10,000
Promissory note				$ 10,000
Repaid principal															10,000
Repaid of interest															260
Second March 2018 Rosen Loan Agreement [Member]
Related Party Loan (Textual)
Warrants, exercise price			$ 0.20
Warrant term			5 years
Interest rate			12.00%
Interest and principal both due date			Mar. 24, 2018
Warrants issued to purchase shares			15,000
Promissory note			$ 15,000
Repaid principal															15,000
Repaid of interest															365
Third March 2018 Rosen Loan Agreement [Member]
Related Party Loan (Textual)
Warrants, exercise price		$ 0.20
Warrant term		5 years
Interest rate		12.00%
Interest and principal both due date		Mar. 28, 2018
Warrants issued to purchase shares		10,000
Promissory note		$ 10,000
Repaid principal															10,000
Repaid of interest															230
February 2018 Convertible Note Offering [Member]
Related Party Loan (Textual)
Repayment of principal															5,298,000
May 2018 Schiller Loan Agreement [Member]
Related Party Loan (Textual)
Warrants, exercise price	$ 0.20
Warrant term	4 years
Interest rate	13.00%
Interest and principal both due date	Feb. 02, 2019
Warrants issued to purchase shares	300,000
Promissory note	$ 100,000
June 2018 Frommer Loan Agreement [Member]
Related Party Loan (Textual)
Warrants, exercise price										$ 0.20
Warrant term										4 years
Interest rate										6.00%
Interest and principal both due date										Aug. 17, 2018
Warrants issued to purchase shares										30,000
Promissory note										$ 10,000
Investor [Member] | August 2017 Convertible Note Offering - Related Party [Member]
Related Party Loan (Textual)
Gross proceeds of private placement offering																	$ 505,000
Short term debt																	645,000
Unpaid interest																	$ 206,026
Issuance of warrants																	4,555,129
Fair value of warrants																	$ 440,157
Increase of principal amount																	60,000
Loss on extinguishment of debt																	500,157
Units of securities																	$ 6,000,000
Convertible secured promissory note, description																	Unit consisting of (a) a 15% Convertible Secured Promissory Note (each a "Note" and together the "Notes"), convertible into shares of the Company's common stock, par value $.001 per share ("Conversion Shares") at a conversion price of $0.20 per share (the "Conversion Price"), and (b) a five-year warrant ( each a "Warrant and together the "Warrants") to purchase common stock equal to one hundred percent (100%) of the shares into which the Notes can be converted into ("Warrant Shares") at an exercise price of $0.20 per share ("Exercise Price").
Conversion price per share																	$ 0.20
Maturity date, description																	The Notes mature on the second (2nd) anniversary of their issuance dates.
Warrants, exercise price																	$ 0.20
Warrant term																	5 years
Debt discount																	$ 160,700
Warrants issued to purchase shares																	2,525,000
Investor [Member] | February 2018 Convertible Note Offering [Member]
Related Party Loan (Textual)
Gross proceeds of private placement offering															$ 25,000
Issuance of warrants															125,000
Units of securities															$ 750,000
Convertible secured promissory note, description															Unit consisting of (a) a 15% Convertible Secured Promissory Note (each a "Note" and together the "Notes"), convertible into shares of the Company's common stock, par value $.001 per share ("Conversion Shares") at a conversion price of $0.20 per share (the "Conversion Price"), and (b) a five-year warrant (each a "Warrant and together the "Warrants") to purchase common stock equal to one hundred percent (100%) of the shares into which the Notes can be converted into ("Warrant Shares") at an exercise price of $0.20 per share ("Exercise Price").
Conversion price per share															$ 0.20
Warrants, exercise price															$ 0.20
Warrant term															5 years
Debt discount															$ 11,054
BCF and related debt discount															1,063
Investor [Member] | March 2018 Convertible Note Offering [Member]
Related Party Loan (Textual)
Gross proceeds of private placement offering															$ 239,400
Issuance of warrants															1,197,000
Debt discount															$ 84,854
Third Party Lender [Member] | Second December 2017 Note [Member]
Related Party Loan (Textual)
Conversion price per share													$ 0.20
Warrants, exercise price													$ 0.20
Warrant term													5 years
Debt discount													$ 36,722
Convertible note													$ 100,000
Interest rate													15.00%
Interest and principal both due date													Dec. 27, 2019
Warrants issued to purchase shares													500,000
Third Party Lender [Member] | Second February 2018 Note [Member]
Related Party Loan (Textual)
Repayment of principal															$ 5,298
Conversion price per share					$ 0.20
Warrants, exercise price					$ 0.20
Warrant term					5 years
Debt discount					$ 7,963
Convertible note					$ 40,750
Interest rate					18.00%
Interest and principal both due date					Sep. 30, 2018
Warrants issued to purchase shares					81,500
Original issue discount					$ 5,298

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Capital Leases Payable (Details) - USD ($)	Jun. 30, 2018	Dec. 31, 2017
Capital Leases Payable [Abstract]
Capital lease obligation to a financing company for a term of five (5) years, collateralized by equipment, with interest at 10.0% per annum, with principal and interest due and payable in monthly installments of $383.10	$ 4,732	$ 4,732
Less current maturities	(4,732)	(4,732)
Capital lease obligation, net of current maturities
TOTAL CAPITAL LEASE OBLIGATION	$ 4,732	$ 4,732

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Capital Leases Payable (Details 1) - USD ($)	Jun. 30, 2018	Dec. 31, 2017
Capital Leases Payable [Abstract]
2018:	$ 4,732	$ 4,732

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Capital Leases Payable (Details Textual)	6 Months Ended
	Jun. 30, 2018 USD ($)
Capital Leases Payable (Textual)
Capital leases due amount	$ 383.10
Capital leases interest per annum	10.00%
Capital lease obligation term	5 years

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Stockholders' Deficit (Details) - Warrants [Member]	6 Months Ended
	Jun. 30, 2018 $ / shares
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range [Line Items]
Exercise price	$ 0.20
Expected dividends	0.00%
Minimum [Member]
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range [Line Items]
Expected volatility	92.14%
Risk free interest rate	1.64%
Expected life of warrant	4 years
Maximum [Member]
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range [Line Items]
Expected volatility	100.56%
Risk free interest rate	2.69%
Expected life of warrant	5 years

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Stockholders' Deficit (Details 1) - Warrant Activities [Member]	6 Months Ended
	Jun. 30, 2018 $ / shares shares
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range [Line Items]
Warrants, Outstanding, Beginning | shares	46,193,779
Warrants, Granted | shares	15,873,016
Warrants, Exercised | shares	(50,000)
Warrants, Forfeited/Cancelled | shares
Warrants, Outstanding and Exercisable, Ending | shares	62,016,795
Weighted Average Exercise Price, Outstanding, Beginning | $ / shares	$ 0.24
Weighted Average Exercise Price, Granted | $ / shares	0.20
Weighted Average Exercise Price, Exercised | $ / shares	0.40
Weighted Average Exercise Price, Forfeited/Cancelled | $ / shares
Weighted Average Exercise Price, Outstanding and Exercisable, Ending | $ / shares	$ 0.24

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Stockholders' Deficit (Details 2) - Warrants [Member]	6 Months Ended
	Jun. 30, 2018 $ / shares shares
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range [Line Items]
Warrants Outstanding, Exercise price	$ 0.20
Warrants Outstanding, Number Outstanding | shares	62,016,795
Warrants Outstanding, Weighted Average Remaining Contractual Life (in years)	3 years 7 months 28 days
Warrants Exercisable, Weighted Average Exercise Price	$ 0.24
Warrants Exercisable , Number Exercisable | shares	62,016,795
Warrants Exercisable, Weighted Average Exercise Price	$ 0.24

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Stockholders' Deficit (Details Textual) - USD ($)	1 Months Ended			6 Months Ended
	Jan. 31, 2018	Dec. 21, 2015	Feb. 13, 2015	Jun. 30, 2018	Jun. 30, 2017	Dec. 31, 2017	Dec. 31, 2016
Stockholders' Deficit (Textual)
Number of shares authorized to issue				320,000,000
Common stock, par value				$ 0.001		$ 0.001
Common stock, shares authorized				300,000,000		300,000,000
Share based payments				$ 285,821	$ 596,000
Series A Cumulative Convertible Preferred Stock [Member]
Stockholders' Deficit (Textual)
Convertible preferred stock			100,000
Shares of Series A stated value			$ 100
Dividend payments, description				Upon the occurrence of an Event of Default (as defined below) and while such Event of Default is outstanding, such dividend rate shall be increased to 15% per annum on the Series A Stated Value. At the Company's option, such dividend payments may be made in (i) cash (ii) additional shares of Series A valued at the Series A Stated Value thereof, in an amount equal to 150% of the cash dividend otherwise payable or (iii) a combination of cash and additional shares of Series A, provided there is not an existing current Event of Default on the date on which a dividend payment is payable, in which event the Holder entitled to receive such dividend may elect to receive such dividends in cash or additional shares of Series A Preferred.
Conversion price				$ 0.25			$ 0.164
Conversion of common stock, description				(i) the number of shares of Common Stock beneficially owned by the Holder and its Affiliates on such Conversion Date, and (ii) the number of Conversion Shares issuable upon the conversion of the Conversion Amount with respect to which the determination of this provision is being made on such Conversion Date, which would result in the aggregate beneficial ownership by the Holder and its Affiliates of more than 4.99% of the outstanding shares of Common Stock of the Corporation. For the purposes of the proviso to the immediately preceding sentence, beneficial ownership shall be determined in accordance with Section 13(d) of the 1934 Act and Regulation 13d-3 thereunder. Subject to the foregoing, the Holder shall not be limited to successive exercises which would result in the aggregate issuance of more than 4.99%. The Holder may allocate which of the equity of the Corporation deemed beneficially owned by the Holder shall be included in the 4.99% amount described above and which shall be allocated to the excess above 4.99%. The Holder may waive the conversion limitation described in this Section in whole or in part, upon and effective after sixty-one (61) days' prior written notice to the Corporation.
Accrued dividends				$ 636,772
Series B Cumulative Convertible Preferred Stock [Member]
Stockholders' Deficit (Textual)
Convertible preferred stock		20,000
Shares of Series A stated value		$ 100.00
Preferential dividends rate				6.00%
Dividend payments, description				Upon the occurrence of an Event of Default as defined below and while such Event of Default is outstanding, such dividend rate shall be increased to 15% per annum on the Series B Stated Value. At the Corporation's option, such dividend payments may be made in (i) cash (ii) additional shares of Series B valued at the Series B Stated Value thereof, in an amount equal to 100% of the cash dividend otherwise payable or (iii) a combination of cash and additional shares of Series B, provided there is not an existing current Event of Default on the date on which a dividend payment is payable, in which event the Holder entitled to receive such dividend may elect to receive such dividends in cash or additional shares of Series B Preferred.
Conversion price				$ 0.30			$ 0.197
Conversion of common stock, description				(i) the number of shares of Common Stock beneficially owned by the Holder and its Affiliates on such Conversion Date, and (ii) the number of Conversion Shares issuable upon the conversion of the Conversion Amount with respect to which the determination of this proviso is being made on such Conversion Date, which would result in the aggregate beneficial ownership by the Holder and its Affiliates of more than 4.99% of the outstanding shares of Common Stock of the Corporation. For the purposes of the proviso to the immediately preceding sentence, beneficial ownership shall be determined in accordance with Section 13(d) of the 1934 Act and Regulation 13d-3 thereunder. Subject to the foregoing, the Holder shall not be limited to successive exercises which would result in the aggregate issuance of more than 4.99%. The Holder may allocate which of the equity of the Corporation deemed beneficially owned by the Holder shall be included in the 4.99% amount described above and which shall be allocated to the excess above 4.99%. The Holder may waive the conversion limitation described in this Section in whole or in part, upon and effective after sixty one (61) days' prior written notice to the Corporation.
Accrued dividends				$ 118,289
Stock Options [Member]
Stockholders' Deficit (Textual)
Aggregate intrinsic value of options outstanding and exercisable				0	0
Share based payments				$ 232,129	$ 463,619
Common Stock [Member]
Stockholders' Deficit (Textual)
Stock issued to consultants for services, shares				610,000
Stock issued to consultants for services, value				$ 116,300
Share based payments				$ 48,889
Common Stock [Member] | Vendor [Member]
Stockholders' Deficit (Textual)
Restricted common stock issued, shares	18,750
Restricted common stock issued to settle liabilities, value	$ 3,750
Gain on settlement of vendor liabilities	$ 375
Warrant [Member] | Promissory note [Member]
Stockholders' Deficit (Textual)
Warrants issued				2,425,500
Fair value of warrants				$ 420,456
Warrant [Member] | Convertible notes [Member]
Stockholders' Deficit (Textual)
Warrants issued				10,481,016
Fair value of warrants				$ 1,284,683
Warrant [Member] | Notes payable - related party [Member]
Stockholders' Deficit (Textual)
Warrants issued				1,563,000
Fair value of warrants				$ 307,808
Warrant [Member] | Convertible notes payable - related party [Member]
Stockholders' Deficit (Textual)
Warrants issued				1,403,500
Fair value of warrants				$ 162,834
Preferred Stock [Member]
Stockholders' Deficit (Textual)
Preferred stock, par value				$ 0.001
Preferred stock, shares authorized				20,000,000

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Commitments and Contingencies (Details)	Jun. 30, 2018 USD ($)
Commitments and Contingencies [Abstract]
2018	$ 35,972
2019	74,204
2020	78,146
2021	82,207
2022	87,851
2023	37,775
Total minimum lease payments	$ 396,155

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Commitments and Contingencies (Details Textual)		3 Months Ended		6 Months Ended
	May 05, 2018 USD ($) ft²	Jun. 30, 2018 USD ($)	Jun. 30, 2017 USD ($)	Jun. 30, 2018 USD ($)	Jun. 30, 2017 USD ($)
Commitments and Contingencies (Textual)
Lease term	5 years
Area of office space | ft²	2,300
Rent expense		$ 88,875	$ 155,661	$ 69,022	$ 77,856
Lease term, Description	The Company signed a 5-year lease for approximately 2,300 square feet of office space at 2050 Center Avenue suite 640, Fort lee, New Jersey 07024. Commencement date of the lease is June 1, 2018. Total amount due under this lease is $411,150.
Total amount due	$ 411,150

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Revision of Prior Year Financial Statements (Details) - USD ($)	3 Months Ended		6 Months Ended
	Jun. 30, 2018	Jun. 30, 2017	Jun. 30, 2018	Jun. 30, 2017	Dec. 31, 2017
Current Liabilities
Accrued dividends	$ 2,094,658		$ 2,094,658		$ 1,462,106
Total Current Liabilities	4,479,346		4,479,346		3,687,200
Total Liabilities	10,101,703		10,101,703		7,544,739
Stockholders' Equity
Total Stockholders' Equity	(9,914,938)		(9,914,938)		(7,367,307)
Statement of Operations
Deemed dividend	65,823	$ 67,888	129,858	$ 131,867
Net loss attributable to common stockholders	$ (2,477,061)	$ (1,534,545)	$ (4,634,726)	$ (3,087,776)
Basic and diluted loss per share	$ (0.06)	$ (0.04)	$ (0.12)	$ (0.08)
Statements of Cash Flows Supplementary Disclosure of Non-Cash Investing And Financing Activities
Deemed dividend			$ 127,795	$ 131,867
As Previously Reported [Member]
Current Liabilities
Accrued dividends					472,444
Total Current Liabilities					4,159,644
Total Liabilities					8,017,183
Stockholders' Equity
Total Stockholders' Equity					7,839,751
Statement of Operations
Deemed dividend
Net loss attributable to common stockholders				$ 2,955,909
Basic and diluted loss per share				$ (0.08)
Statements of Cash Flows Supplementary Disclosure of Non-Cash Investing And Financing Activities
Deemed dividend				$ 101,385
Adjustment [Member]
Current Liabilities
Accrued dividends					(472,444)
Total Current Liabilities					(472,444)
Total Liabilities					(472,444)
Stockholders' Equity
Total Stockholders' Equity					$ (472,444)
Statement of Operations
Deemed dividend				131,867
Net loss attributable to common stockholders				$ 131,867
Basic and diluted loss per share
Statements of Cash Flows Supplementary Disclosure of Non-Cash Investing And Financing Activities
Deemed dividend				$ 30,482

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Subsequent Events (Details)	6 Months Ended
	Jun. 30, 2018 USD ($) $ / shares shares
Investors [Member]
Subsequent Events (Textual)
Gross proceeds issuance of notes payable | $	$ 100,000
Warrant term	4 years
Warrants purchase of common stock | shares	300,000
Warrants, exercise price | $ / shares	$ 0.20
Investors one [Member]
Subsequent Events (Textual)
Gross proceeds issuance of notes payable | $	$ 25,000
Warrant term	4 years
Warrants purchase of common stock | shares	75,000
Warrants, exercise price | $ / shares	$ 0.20