MobileSmith (MOSTQ) 10-Q 4 Aug 16 2016 Q2 Quarterly report Financial data

Document and Entity Information

Document and Entity Information - shares	6 Months Ended
	Jun. 30, 2016	Aug. 03, 2016
Document And Entity Information
Entity Registrant Name	MobileSmith, Inc.
Entity Central Index Key	1,113,513
Document Type	10-Q
Document Period End Date	Jun. 30, 2016
Amendment Flag	false
Current Fiscal Year End Date	--12-31
Is Entity a Well-known Seasoned Issuer?	No
Is Entity a Voluntary Filer?	No
Is Entity's Reporting Status Current?	Yes
Entity Filer Category	Smaller Reporting Company
Entity Common Stock, Shares Outstanding		19,827,542
Document Fiscal Period Focus	Q2
Document Fiscal Year Focus	2,016

CONDENSED CONSOLIDATED BALANCE

CONDENSED CONSOLIDATED BALANCE SHEETS - USD ($)	Jun. 30, 2016	Dec. 31, 2015
Current assets
Cash and cash equivalents	$ 582,027	$ 580,220
Restricted cash	125,001	124,988
Trade Accounts Receivable, Net of Allowance for Doubtful Accounts of $16,050	399,257	183,350
Prepaid expenses and other current assets	70,387	69,552
Total current assets	1,176,672	958,110
Property and equipment, net	96,764	98,963
Capitalized software, net	336,505	390,518
Intangible assets, net	46,352	55,099
Other assets	0	6,264
Total Other Assets	479,621	550,844
TOTAL ASSETS	1,656,293	1,508,954
Current liabilities
Trade Accounts Payable	86,658	45,717
Accrued Expenses	225,486	247,858
Accrued interest	369,895	350,613
Capital Lease Obligations	32,208	30,877
Deferred revenue	1,560,718	1,007,970
Bank Loan	0	5,000,000
Convertible Notes Payable, Related Parties, Net of Discount	0	33,363,488
Convertible Notes Payable, Net of Discount	0	680,640
Total current liabilities	2,274,965	40,727,163
Long-term liabilities:
Bank Loan	5,000,000	0
Convertible Notes Payable, Related Parties, Net of Discount	36,531,560	0
Convertible Notes Payable, Net of Discount	680,640	0
Capital Lease Obligations	67,317	83,761
Deferred Rent	48,264	53,592
Total long-term liabilities	42,327,781	137,353
Total liabilities	44,602,746	40,864,516
Commitments and Contingencies (Note 3)
Stockholders' deficit:
Preferred Stock, $0.001 Par Value, 5,000,000 Shares Authorized, No Shares Issued and Outstanding at June 30, 2016 and December 31, 2015	0	0
Common Stock, $0.001 Par Value, 100,000,000 and 45,000,000 Shares Authorized At June 30, 2016 and December 31, 2015, Respectively; 19,827,542 Shares Issued and Outstanding at June 30, 2016 and December 31, 2015	19,828	19,828
Additional paid-in capital	98,062,577	97,545,601
Accumulated deficit	(141,028,858)	(136,920,991)
Total stockholders' deficit	(42,946,453)	(39,355,562)
TOTAL LIABILITIES AND STOCKHOLDERS' DEFICIT	$ 1,656,293	$ 1,508,954

CONDENSED CONSOLIDATED BALANCE3

CONDENSED CONSOLIDATED BALANCE SHEETS (Parenthetical) - USD ($)	Jun. 30, 2016	Dec. 31, 2015
Statement of Financial Position [Abstract]
Allowance for Doubtful Accounts	$ 99,300	$ 16,050
Stockholders' equity:
Preferred stock, par value	$ 0.001	$ 0.001
Preferred stock, authorized	5,000,000	5,000,000
Preferred stock, issued	0	0
Preferred stock, outstanding	0	0
Common stock, par value	$ 0.001	$ 0.001
Common stock, authorized	100,000,000	45,000,000
Common stock, issued	19,827,542	19,827,542
Common stock, outstanding	19,827,542	19,827,542

CONDENSED CONSOLIDATED STATEMEN

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (unaudited) - USD ($)	3 Months Ended		6 Months Ended
	Jun. 30, 2016	Jun. 30, 2015	Jun. 30, 2016	Jun. 30, 2015
REVENUES:
Subscription and Support	$ 494,169	$ 377,545	$ 965,299	$ 773,733
Professional Services and Other	4,154	30,000	4,154	60,000
Total revenues	498,323	407,545	969,453	833,733
COST OF REVENUES
Subscription and Support	93,048	74,229	208,369	133,698
Professional Services and Other	51,179	14,272	56,242	23,545
Total Cost of Revenue	144,227	88,501	264,611	157,243
GROSS PROFIT	354,096	319,044	704,842	676,490
OPERATING EXPENSES:
Sales and marketing	325,450	267,047	561,174	559,246
Research and development	400,856	333,685	807,399	673,825
General and administrative	399,388	283,887	752,361	598,453
Total operating expenses	1,125,694	884,619	2,120,934	1,831,524
LOSS FROM OPERATIONS	(771,598)	(565,575)	(1,416,092)	(1,155,034)
OTHER INCOME (EXPENSE):
Other Income	3,529	1,111	11,568	1,490
Interest expense, net	(1,221,447)	(1,311,617)	(2,703,343)	(2,578,753)
Total Other Expense	(1,217,918)	(1,310,506)	(2,691,775)	(2,577,263)
NET LOSS	$ (1,989,516)	$ (1,876,081)	$ (4,107,867)	$ (3,732,297)
NET LOSS PER COMMON SHARE:
Basic and Fully Diluted	$ (0.10)	$ (0.09)	$ (0.21)	$ (0.19)
WEIGHTED-AVERAGE NUMBER OF SHARES USED IN COMPUTING NET LOSS PER COMMON SHARE:
Basic and fully diluted	19,827,542	19,827,542	19,827,542	19,827,542

CONDENSED CONSOLIDATED STATEME5

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (unaudited) - USD ($)	6 Months Ended
	Jun. 30, 2016	Jun. 30, 2015
CASH FLOWS FROM OPERATING ACTIVITIES:
Net loss	$ (4,107,867)	$ (3,732,297)
Adjustments to reconcile net loss to net cash used in operating activities:
Depreciation and amortization	81,624	81,007
Bad Debt Expense (Gain on Reversal of Bad Debt)	83,250	(6,000)
Amortization of Debt Discount	1,092,547	1,166,864
Share Based Compensation	42,501	42,617
Changes in assets and liabilities:
Accounts Receivable	(299,157)	(93,822)
Prepaid Expenses and Other Assets	5,429	(4,069)
Accounts Payable	40,941	(51,949)
Deferred revenue	552,748	50,507
Accrued and other expenses	(8,418)	(149,735)
Net Cash Used in Operating Activities	(2,516,402)	(2,696,877)
CASH FLOWS FROM INVESTING ACTIVITIES:
Payments to Acquire Property, Plant and Equipment	(16,665)	(9,683)
Net Cash Used in Investing Activities	(16,665)	(9,683)
CASH FLOWS FROM FINANCING ACTIVITIES:
Restricted cash used to pay interest expense	114,112	97,385
Deposit of Cash to Restricted Account	(114,125)	(97,385)
Proceeds from Issuance of Long Term Debt	2,550,000	3,200,000
Repayments of debt borrowings	(15,113)	(13,556)
Net cash provided by financing activities	2,534,874	3,186,444
NET INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS	1,807	479,884
CASH AND CASH EQUIVALENTS, BEGINNING OF PERIOD	580,220	320,286
CASH AND CASH EQUIVALENTS, END OF PERIOD	582,027	800,170
Supplemental disclosures of cash flow information:
Cash paid during the period for: Interest	1,570,647	1,558,498
The Company Recorded Debt Discount Associated with Beneficial Conversion Feature	$ 474,475	$ 0

CONDENSED CONSOLIDATED STATEME6

CONDENSED CONSOLIDATED STATEMENT OF STOCKHOLDERS' DEFICIT (Unaudited) - 6 months ended Jun. 30, 2016 - USD ($)	Common Stock	Additional Paid-In Capital	Accumulated Deficit	Total
Beginning Balance, shares at Dec. 31, 2015	19,827,542
Beginning Balance, amount at Dec. 31, 2015	$ 19,828	$ 97,545,601	$ 136,920,991	$ (39,355,562)
Equity-Based Compensation		42,501		42,501
Beneficial Conversion Feature Recorded as a Result of Issuance of Convertible Debt		474,475		474,475
Net loss			(4,107,867)	(4,107,867)
Ending Balance, shares at Jun. 30, 2016	19,827,542
Ending Balance, amount at Jun. 30, 2016	$ 19,828	$ 98,062,577	$ 141,028,858	$ (42,946,453)

1. DESCRIPTION OF BUSINESS AND

1. DESCRIPTION OF BUSINESS AND BASIS OF PRESENTATION	6 Months Ended
	Jun. 30, 2016
Accounting Policies [Abstract]
1. DESCRIPTION OF BUSINESS AND BASIS OF PRESENTATION	MobileSmith, Inc. (referred to herein as the “Company,” “us,” “we,” or “our”) was incorporated as Smart Online, Inc. in the State of Delaware in 1993. The Company changed its name to MobileSmith, Inc. effective July 1, 2013. The Company develops software products and services and targets businesses who need to connect with their stakeholders (customers, employees, broader public) through a variety of mobile devices and do so within the fastest time to market possible, while by-passing the need to write a single line of code. The Company’s flagship product is the MobileSmith® Platform (the “Platform”). The Platform is an innovative app development platform that enables organizations to rapidly create, deploy, and manage custom, native smartphone and tablet apps deliverable across iOS and Android mobile platforms without writing a single line of code. These condensed consolidated financial statements include accounts of the Company and its wholly-owned subsidiary, which was created to explore the concept of a consumer targeted mobile app development platform. From time to time, the Company may create additional wholly-owned subsidiaries in order to test various new services as a part of its research and development process. The subsidiary has not had material activity in 2016. The Company’s principal products and services include: ● subscription to its Software as a Service ("SaaS") cloud based mobile app development platform to customers who design and build their own apps; ● dedicated internal and secure mobile development platform for the U.S. Department of Defense and related contractors; ● custom mobile application design and development services; ● mobile application marketing services; and ● mobile strategy implementation consulting. The Company prepared the accompanying unaudited condensed consolidated financial statements pursuant to the rules and regulations of the Securities and Exchange Commission (the “SEC”). Pursuant to these rules and regulations, the Company has condensed or omitted certain information and footnote disclosures it normally includes in its audited annual consolidated financial statements prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”). In management’s opinion, the Company has made all adjustments (consisting only of normal, recurring adjustments, except as otherwise indicated) necessary to fairly present its financial position, results of operations, cash flows, and stockholders’ deficit as of June 30, 2016. The Company’s interim period operating results do not necessarily indicate the results that may be expected for any other interim period or for the full fiscal year. These condensed consolidated financial statements and accompanying notes should be read in conjunction with the audited annual consolidated financial statements and notes thereto included in the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2015 on file with the SEC (the “Annual Report”) Except as otherwise noted, there have been no material changes to the Company’s significant accounting policies as compared to the significant accounting policies described in the Annual Report. The accompanying condensed consolidated financial statements have been prepared on a going concern basis, which contemplates the realization of assets and the satisfaction of liabilities in the normal course of business. During the six months ended June 30, 2016 and 2015, the Company incurred net losses as well as negative cash flows from operations. These factors raise substantial doubt about the Company’s ability to continue as a going concern. The accompanying condensed consolidated financial statements do not include any adjustments relating to the recoverability and classification of recorded asset amounts or the amounts or classification of liabilities that might be necessary should the Company be unable to continue as a going concern. Recently Issued Accounting Pronouncements The Company evaluates new significant accounting pronouncements at each reporting period. For the period ended June 30, 2016, the Company did not adopt any new pronouncement that had or is expected to have a material effect on the Company’s presentation of its condensed consolidated financial statements. All pronouncements that are expected to affect future year financial statements are disclosed in the Annual Report on Form 10-K for the year ended December 31, 2015.

2. DEBT

2. DEBT	6 Months Ended
	Jun. 30, 2016
Debt Disclosure [Abstract]
2. DEBT	The table below summarizes the Company’s debt outstanding at June 30, 2016 and December 31, 2015: Debt Description June 30, December 31, 2016 2015 Maturity Rate Comerica Bank Loan and Security Agreement $ 5,000,000 $ 5,000,000 June 2018 3.85 % Capital lease obligations - Noteholder lease 80,980 92,270 August 2019 8.00 % Capital lease obligations - office furniture 18,545 22,368 August 2018 9.80 % Convertible notes - related parties, net of discount of $1,392,671 and $2,010,173, respectively 36,531,560 33,363,488 November 2018 8.00 % Convertible notes, net of discount of $50,129 680,640 680,640 November 2018 8.00 % Total debt 42,311,725 39,158,766 Less: current portion of long term debt Capital lease obligations 32,208 30,877 Comerica Bank LSA - 5,000,000 Convertible notes - related parties, net of discount of $2,010,743 - 33,363,488 Convertible notes, net of discount of $50,129 - 680,640 Total current portion of long term debt 32,208 39,075,005 Debt - long term $ 42,279,517 $ 83,761 Convertible Notes During the six months ended June 30, 2016, the Company privately placed $2,550,000 in principal amount of additional unsecured Convertible Subordinated Notes unsecured Convertible Subordinated Note Purchase Agreement dated December 10, 2014 On May 17, 2016, the Company and the holders of the majority of aggregate outstanding principal amount of 2014 NPA Notes as well the Secured Promissory Notes (the “2007 NPA Notes”) issued under the Convertible Secured Subordinated Note Purchase Agreement dated November 14, 2007 (the "2007 NPA”) agreed to extend to November 14, 2018 the maturity date of the 2014 NPA Notes and the 2007 NPA Notes. Except as so amended, all of the terms relating to the outstanding 2007 Notes and the 2014 Notes continue in full force and effect. The Company is entitled to utilize the amounts available for future borrowing under each of the 2007 Note Purchase Agreement and the 2014 Note Purchase Agreement through November 14, 2018. As a result of modification, any unamortized discount will be amortized into interest expense through the new maturity date of November 14, 2018. The market value of the Company’s common stock on the date of each issuance of issuance of the 2014 NPA Notes to UBP was higher than the conversion price, which resulted in a beneficial conversion feature totaling $474,475 and corresponding debt discount, which is being amortized into interest expense through the maturity of the Notes. The table below summarizes convertible notes issued as of June 30, 2016 by type: Convertible Notes Type: Balance 2007 NPA notes, net of discount $ 29,428,736 2014 NPA notes, net of discount 7,783,464 Total convertible notes, net of discount $ 37,212,200 Comerica LSA On May 24, 2016, the Company and Comerica Bank entered into First Amendment (the “First Amendment”) to Loan and Security Agreement with Comerica Bank dated June 9, 2014, extending to June 6, 2018 the maturity date of the outstanding loan thereunder , which was originally scheduled to become due on June 6, 2016.

3. COMMITMENTS AND CONTINGENCIE

3. COMMITMENTS AND CONTINGENCIES	6 Months Ended
	Jun. 30, 2016
Commitments and Contingencies Disclosure [Abstract]
3. COMMITMENTS AND CONTINGENCIES	Aggregate future lease commitments The Company leases computers, office equipment and office furniture under capital lease agreements that expire through August 2019. Total amount financed under these capital leases at June 30, 2016 was $99,525. This obligation is included within the Company’s total debt. The table below summarizes Company’s future obligations under its capital leases: Year: 2016 $ 19,629 2017 39,259 2018 34,189 2019 19,412 112,489 Less amount representing interest (12,964 ) Capital lease obligations $ 99,525 The Company leases its office space in Raleigh, North Carolina pursuant to a lease with an initial term that expires in March 2019. The lease contains an option to renew for two additional three-year lease terms. In addition, the Company leases a vehicle pursuant to a lease that expired in July 2016. The table below summarizes the Company’s future obligations under its office and vehicle operating leases: Year: 2016 $ 82,315 2017 167,786 2018 172,418 2019 44,082 Total $ 466,601 Legal Proceedings From time to time, the Company may be subject to routine litigation, claims or disputes in the ordinary course of business. The Company defends itself vigorously in all such matters. In the opinion of management, no pending or known threatened claims, actions or proceedings against the Company are expected to have a material adverse effect on its financial position, results of operations or cash flows. However, the company cannot predict with certainty the outcome or effect of any such litigation or investigatory matters or any other pending litigations or claims. There can be no assurance as to the ultimate outcome of any such lawsuits and investigations. The Company will record a liability when it believes that it is both probable that a loss has been incurred and the amount can be reasonably estimated. The Company periodically evaluates developments in its legal matters that could affect the amount of liability that it has previously accrued, if any, and makes adjustments as appropriate. Significant judgment is required to determine both the likelihood of there being, and the estimated amount of, a loss related to such matters, and the Company’s judgment may be incorrect. The outcome of any proceeding is not determinable in advance. Until the final resolution of any such matters that the Company may be required to accrue for, there may be an exposure to loss in excess of the amount accrued, and such amounts could be material.

4. EQUITY AND EQUITY BASED COMP

4. EQUITY AND EQUITY BASED COMPENSATION	6 Months Ended
	Jun. 30, 2016
Equity [Abstract]
4. EQUITY COMPENSATION	On May 23, 2016 the Company stockholders approved an increase in the number of authorized common shares from 45,000,000 to 100,000,000 and approved MobileSmith Inc. 2016 Equity Compensation Plan. A total of 15,000,000 shares of Common Stock have been reserved for issuance under the plan. No equity based compensation has been awarded under the 2016 Equity Compensation Plan. The following is a summary of the stock option activity for the six months ended June 30, 2016: Number of Shares Weighted Average Exercise Price Weighted Average Remaining Contractual Term Aggregate Intrinsic Value Outstanding, December 31, 2015 361,349 $ 1.44 Cancelled (75,000 ) 1.50 Issued - - Outstanding, June 30, 2016 286,349 1.42 2.37 $ 36,628 Vested and exercisable, June 30, 2016 234,014 $ 1.38 2.62 $ 34,894 Aggregate intrinsic value represents the difference between the closing price of the Company’s common stock at June 30, 2016 and the exercise price of outstanding, in-the-money stock options. The closing price of the common stock at June 30, 2016, as reported on the Over-the-Counter Bulletin Board, was $1.40 per share. At June 30, 2016, $18,735

5. MAJOR CUSTOMERS AND CONCENTR

5. MAJOR CUSTOMERS AND CONCENTRATION	6 Months Ended
	Jun. 30, 2016
Risks and Uncertainties [Abstract]
5. MAJOR CUSTOMERS AND CONCENTRATION	For the six months ended June 30, 2016, one major customer accounted for 15% of total revenues and one customer accounted for 60% of the accounts receivable balance. For the six months ended June 30, 2015, two major customers accounted for 33% of total revenues and five customers accounted for 69% of the accounts receivable balance.

2. DEBT (Tables)

2. DEBT (Tables)	6 Months Ended
	Jun. 30, 2016
Debt Disclosure [Abstract]
Company's debt	Debt Description June 30, December 31, 2016 2015 Maturity Rate Comerica Bank Loan and Security Agreement $ 5,000,000 $ 5,000,000 June 2018 3.85 % Capital lease obligations - Noteholder lease 80,980 92,270 August 2019 8.00 % Capital lease obligations - office furniture 18,545 22,368 August 2018 9.80 % Convertible notes - related parties, net of discount of $1,392,671 and $2,010,173, respectively 36,531,560 33,363,488 November 2018 8.00 % Convertible notes, net of discount of $50,129 680,640 680,640 November 2018 8.00 % Total debt 42,311,725 39,158,766 Less: current portion of long term debt Capital lease obligations 32,208 30,877 Comerica Bank LSA - 5,000,000 Convertible notes - related parties, net of discount of $2,010,743 - 33,363,488 Convertible notes, net of discount of $50,129 - 680,640 Total current portion of long term debt 32,208 39,075,005 Debt - long term $ 42,279,517 $ 83,761
Summary of convertible notes	Convertible Notes Type: Balance 2007 NPA notes, net of discount $ 29,428,736 2014 NPA notes, net of discount 7,783,464 Total convertible notes, net of discount $ 37,212,200

3. COMMITMENTS AND CONTINGENC13

3. COMMITMENTS AND CONTINGENCIES (Tables)	6 Months Ended
	Jun. 30, 2016
Commitments and Contingencies Disclosure [Abstract]
Company's future obligations under its capital leases	Year: 2016 $ 19,629 2017 39,259 2018 34,189 2019 19,412 112,489 Less amount representing interest (12,964 ) Capital lease obligations $ 99,525
Company's future obligation under the new office and vehicle leases	Year: 2016 $ 82,315 2017 167,786 2018 172,418 2019 44,082 Total $ 466,601

4. EQUITY AND EQUITY BASED CO14

4. EQUITY AND EQUITY BASED COMPENSATION (Tables)	6 Months Ended
	Jun. 30, 2016
Equity And Equity Based Compensation Tables
Schedule of Stock Options Outstanding	Number of Shares Weighted Average Exercise Price Weighted Average Remaining Contractual Term Aggregate Intrinsic Value Outstanding, December 31, 2015 361,349 $ 1.44 Cancelled (75,000 ) 1.50 Issued - - Outstanding, June 30, 2016 286,349 1.42 2.37 $ 36,628 Vested and exercisable, June 30, 2016 234,014 $ 1.38 2.62 $ 34,894

2. DEBT (Details)

2. DEBT (Details) - USD ($)	Jun. 30, 2016	Dec. 31, 2015
Debt Details
Comerica Bank LSA	$ 5,000,000	$ 5,000,000
Capital leases obligations - Noteholder lease	80,980	92,270
Capital lease obligations - Office furniture	18,545	22,368
Convertible notes - related parties, net of discount of $1,392,671 and $2,010,173, respectively	2,010,173	2,010,743
Convertible notes, net of discount of $50,129	680,640	680,640
Total debt	42,311,725	39,158,766
Less: current portion of long term debt
Capital lease obligations	32,208	30,877
Comerica Bank LSA	0	5,000,000
Convertible notes - related parties, net of discount of $2,010,743	0	33,363,488
Convertible notes, net of discount of $50,129	0	680,640
Total current portion of long term debt	32,208	39,075,005
Debt - long term	$ 42,279,517	$ 83,761

2. DEBT (Details 1)

2. DEBT (Details 1)	Jun. 30, 2016USD ($)
Convertible notes, net of discount	$ 37,212,200
2007 NPA notes, net of discount
Convertible notes, net of discount	29,428,736
2014 NPA notes
Convertible notes, net of discount	$ 7,783,464

3. COMMITMENTS AND CONTINGENC17

3. COMMITMENTS AND CONTINGENCIES (Details)	Jun. 30, 2016USD ($)
Commitments and Contingencies Disclosure [Abstract]
2,016	$ 19,629
2,017	29,259
2,018	34,189
2,019	19,412
Thereafter	112,489
Less amount representing interest	(12,964)
Capital lease obligations	$ 99,525

3. COMMITMENTS AND CONTINGENC18

3. COMMITMENTS AND CONTINGENCIES (Details 1)	Jun. 30, 2016USD ($)
Commitments and Contingencies Disclosure [Abstract]
2,016	$ 82,315
2,017	167,786
2,018	172,418
2,019	44,082
Total	$ 466,601

4. EQUITY COMPENSATION (Details

4. EQUITY COMPENSATION (Details)	6 Months Ended
	Jun. 30, 2016USD ($)$ / sharesshares
Equity Compensation Details
Number of Shares Outstanding, Beginning | shares	361,349
Number of Shares Cancelled | shares	(75,000)
Number of Shares Issued | shares	0
Number of Shares Outstanding, Ending | shares	286,349
Stock Options Vested and Exercisable Number of Shares | shares	234,014
Weighted Average Exercise Price Outstanding, Beginning | $ / shares	$ 1.44
Weighted Average Exercise Price Cancelled | $ / shares	1.50
Weighted Average Exercise Price Issued | $ / shares	0
Weighted Average Exercise Price Outstanding, Ending | $ / shares	1.42
Weighted Average Exercise Price Vested and exercisable, Ending | $ / shares	$ 1.38
Weighted Average Remaining Contractual Life (in years) Outstanding	2 years 4 months 13 days
Weighted Average Remaining Contractual Life (in years) Vested and expected to vest	2 years 7 months 13 days
Aggregate Intrinsic Value Outstanding | $	$ 36,628
Aggregate Intrinsic Value vested and expected to vest | $	$ 34,894

5. MAJOR CUSTOMERS AND CONCEN20

5. MAJOR CUSTOMERS AND CONCENTRATION OF CREDIT RISK (Details Narrative)	6 Months Ended
	Jun. 30, 2016	Jun. 30, 2015
One Customers
Percentage of revenues from major customers	15.00%
Percentage of accounts receivables from major customers	60.00%
Two Customers
Percentage of revenues from major customers		33.00%
Five Customers
Percentage of accounts receivables from major customers		69.00%