Dais (DLYT) 10-Q 21 Aug 17 2017 Q2 Quarterly report Financial data

Document and Entity Information

Document and Entity Information - shares	6 Months Ended
	Jun. 30, 2017	Aug. 20, 2017
Document And Entity Information
Entity Registrant Name	DAIS ANALYTIC CORP
Entity Central Index Key	1,125,699
Document Type	10-Q
Document Period End Date	Jun. 30, 2017
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		127,901,432
Document Fiscal Period Focus	Q2
Document Fiscal Year Focus	2,017

CONDENSED BALANCE SHEETS

CONDENSED BALANCE SHEETS - USD ($)	Jun. 30, 2017	Dec. 31, 2016
CURRENT ASSETS:
Cash and cash equivalents	$ 26,675	$ 21,066
Accounts receivable, net	12,487	1,500
Other receivables	9,175	11,004
Inventory	89,020	77,599
Prepaid expenses	68,043	20,714
Total Current Assets	205,400	131,883
Property and equipment, net	112,282	131,003
OTHER ASSETS:
Deposits	4,780	4,780
Patents, net	120,758	118,115
Total Other Assets	125,538	122,895
TOTAL ASSETS	443,220	385,781
CURRENT LIABILITIES:
Accounts payable, including related party payables of $94,591 and $61,986 at June 30, 2017 and December 31, 2016, respectively	560,171	378,123
Accrued expenses, other	238,641	232,802
Customer deposits	23,580
Debt due to related party		45,400
Note Payable to related party	585,000	340,000
Current portion of deferred revenue	7,741	7,741
Total Current Liabilities	1,415,133	1,004,066
LONG-TERM LIABILITIES:
Accrued compensation and related benefits	1,657,338	1,549,399
Convertible notes payable, net of unamortized debt discount and deferred debt issuance costs	3,231
Derivative Liabilities	505,383
Total Long-Term Liabilities	2,165,952	1,549,399
Total Liabilities	3,581,085	2,553,465
STOCKHOLDERS' DEFICIT
Common stock; $0.01 par value; 240,000,000 shares authorized; 128,158,645 and 121,300,077 shares issued; and 127,901,432 and 120,042,865 shares outstanding at June 30, 2017 and December 31, 2016, respectively	1,281,587	1,213,001
Capital in excess of par value	42,132,756	41,745,913
Accumulated deficit	(45,090,096)	(43,664,486)
Total	(1,675,753)	(705,572)
Treasury stock at cost, 1,257,213 shares	(1,462,112)	(1,462,112)
Total Stockholders' Deficit	(3,137,865)	(2,167,684)
TOTAL LIABILITIES AND STOCKHOLDERS' DEFICIT	$ 443,220	$ 385,781

CONDENSED BALANCE SHEETS (Paren

CONDENSED BALANCE SHEETS (Parenthetical) - $ / shares	Jun. 30, 2017	Dec. 31, 2016
STOCKHOLDERS' DEFICIT
Common stock, par value	$ 0.01	$ 0.01
Common stock, shares authorized	240,000,000	240,000,000
Common stock, shares issued	128,158,645	121,300,077
Common stock, shares outstanding	127,901,432	120,042,865
Treasury stock shares	1,257,213	1,257,213

CONDENSED STATEMENTS OF OPERATI

CONDENSED STATEMENTS OF OPERATIONS (Unaudited) - USD ($)	3 Months Ended		6 Months Ended
	Jun. 30, 2017	Jun. 30, 2016	Jun. 30, 2017	Jun. 30, 2016
REVENUE:
Sales	$ 115,024	$ 202,264	$ 136,400	$ 363,908
Royalty and license fees		51,419		102,839
TOTAL	115,024	253,683	136,400	466,747
COST OF GOODS SOLD	94,989	184,092	116,009	294,593
GROSS MARGIN	20,035	69,591	20,391	172,154
OPERATING EXPENSES
Research and development, net	96,102	90,980	163,020	277,611
Selling, general and administrative	560,679	520,921	900,403	858,806
TOTAL OPERATING EXPENSES	656,781	611,901	1,063,423	1,136,417
LOSS FROM OPERATIONS	(636,746)	(542,310)	(1,043,032)	(964,263)
OTHER INCOME (EXPENSE)
Other income				32,338
Interest expense, net income	(509,764)	(918)	(577,753)	(1,057)
Change in fair value of derivative liabilities	195,175		195,175
TOTAL OTHER (EXPENSE) INCOME, NET	(314,589)	(918)	(382,578)	31,281
NET LOSS	$ (951,335)	$ (543,228)	$ (1,425,610)	$ (932,982)
NET LOSS PER COMMON SHARE, BASIC AND DILUTED	$ (0.01)	$ .00	$ (0.01)	$ (0.01)
WEIGHTED AVERAGE NUMBER OF COMMON SHARES OUTSTANDING, BASIC AND DILUTED	126,431,653	119,542,864	123,636,375	119,910,996

CONDENSED STATEMENT OF STOCKHOL

CONDENSED STATEMENT OF STOCKHOLDERS DEFICIT (Unaudited) - 6 months ended Jun. 30, 2017 - USD ($)	Common Stock	Capital in Excess of Par Value	Accumulated Deficit	Treasury Stock	Total
Beginning Balance, Shares at Dec. 31, 2016	121,300,077
Beginning Balance, Amount at Dec. 31, 2016	$ 1,213,001	$ 41,745,913	$ (43,664,486)	$ (1,462,112)	$ (2,167,684)
Issuance of common stock for services, accrued expenses and debt cost, Shares	6,378,568
Issuance of common stock for services, accrued expenses and debt cost, Amount	$ 63,786	240,714			304,500
Issuance of common stock for settlement of accrued interest-related party, Shares	480,000
Issuance of common stock for settlement of accrued interest-related party, Amount	$ 4,800	12,400			17,200
Issuance of debt warrants to related party		133,729			133,729
Net loss			(1,425,610)		(1,425,610)
Ending Balance, Shares at Jun. 30, 2017	128,158,645
Ending Balance, Amount at Jun. 30, 2017	$ 1,281,587	$ 42,132,756	$ (45,090,096)	$ (1,462,112)	$ (3,137,865)

CONDENSED STATEMENTS OF CASH FL

CONDENSED STATEMENTS OF CASH FLOWS (Unaudited) - USD ($)	6 Months Ended
	Jun. 30, 2017	Jun. 30, 2016
CASH FLOWS FROM OPERATING ACTIVITIES:
Net loss	$ (1,425,610)	$ (932,982)
Adjustments to reconcile net loss to net cash and cash equivalents used by operating activities:
Amortization of debt issue costs	2,997
Depreciation and amortization	32,727	43,059
Change in fair value of derivative liability	(195,175)
Non-cash interest expenses	363,807
Fair value of warrant issued for debt modification	133,729
Amortization of discount	39,484
Stock issued for finance cost	1,800
Stock compensation	180,000	163,294
(Increase) decrease in:
Accounts receivable	(10,987)	60,374
Inventory	(11,422)	(910)
Other receivables		(49,205)
Prepaid expenses and other assets	(45,499)	18,671
Increase (decrease) in:
Accounts payable and accrued expenses	182,048	(12,436)
Accrued related party		127,338
Accrued expenses	228,778	6,739
Customer Deposits	23,580	17,970
Deferred revenue		(59,839)
Net cash used by operating activities	(499,744)	(617,927)
CASH FLOWS FROM INVESTING ACTIVITIES:
Increase in patent costs	(14,411)	(11,741)
Purchases of property and equipment	(2,237)	(33,572)
Net cash used by investing activities	(16,648)	(45,313)
CASH FLOWS FROM FINANCING ACTIVITIES:
Payments on note payable, related party
Proceeds from note payable- related party	245,000	150,000
Proceeds from note payable	277,000
Net cash provided by financing activities	522,000	150,000
Net increase (decrease) in cash and cash equivalents	5,608	(513,240)
Cash and cash equivalents, beginning of period	21,066	698,754
Cash and cash equivalents, end of period	26,675	185,514
SUPPLEMENTAL CASH FLOW INFORMATION:
Cash paid for interest	119	1,192
NON-CASH FINANCING ACTIVITIES
Treasury stock from investment in China operating company		(190,000)
Payment of accrued expense with note payable	43,000
Issuance of common stock for settlement of accrued expenses	102,000
Issuance of common stock for settlement of interest due to related party	15,400
Issuance of common stock for deferred debt issuance costs	22,500
Debt costs deducted from proceeds of notes	16,750
Initial derivative liability on note issuance	700,558
Issuance of warrants for debt modification	133,729
Debt discount on issuance of convertible note	$ 371,425

Background Information

Background Information	6 Months Ended
	Jun. 30, 2017
Notes to Financial Statements
Note 1 - Background Information	Dais Analytic Corporation (the “Company”), a New York corporation, has developed and is commercializing applications using its nanostructure polymer technology. The first commercial product is an energy recovery ventilator (“ERV”) (core and systems) for use in commercial Heating, Ventilating, and Air Conditioning (HVAC) applications. The second commercial product is NanoClear TM The Company is dependent on third parties to manufacture the key components needed for its nanostructured based materials and some portion of the value-added products made with these materials. Accordingly, a suppliers’ failure to supply components in a timely manner, or to supply components that meet the Company’s quality, quantity and cost requirements or technical specifications, or the inability to obtain alternative sources of these components on a timely basis or on acceptable terms, would create delays in production of the Company’s products and/or increase its unit costs of production. Certain of the components or the processes of the Company’s suppliers are proprietary. If the Company was ever required to replace any of its suppliers, it should be able to obtain comparable components from alternative suppliers at comparable costs but this would create a delay in production. The Company’s accompanying condensed financial statements are unaudited, but in the opinion of management reflect all adjustments necessary to fairly state the Company’s financial position, results of operations, stockholders’ deficit and cash flows as of and for the dates and periods presented. The financial statements of the Company are prepared in accordance with accounting principles generally accepted in the United States of America for interim financial information. The unaudited financial statements and notes are presented as permitted by Form 10-Q. Accordingly, certain information and note disclosures normally included in financial statements prepared in accordance with accounting principles generally accepted in the United States of America have been omitted although the Company generally believes that the disclosures are adequate to ensure that the information presented is not misleading. The accompanying financial statements and notes should be read in conjunction with the audited financial statements and notes of the Company for the fiscal year ended December 31, 2016 included in the Company’s Annual Report on Form 10-K filed with the Securities and Exchange Commission on April 17, 2017. The results of operations for the three and six month periods ended June 30, 2017 are not necessarily indicative of the results that may be expected for any future quarters or for the entire year ending December 31, 2017.

Going Concern and Management's

Going Concern and Management's Plans	6 Months Ended
	Jun. 30, 2017
Notes to Financial Statements
Note 2 - Going Concern and Management’s Plans	The accompanying financial statements have been prepared assuming that the Company will continue as a going concern. For the six months ended June 30, 2017, the Company generated a net loss of $1,425,610 and the Company has incurred significant losses since inception. As of June 30, 2017, the Company had an accumulated deficit of $45,090,096, a stockholders’ deficit of $3,137,865 and cash and cash equivalents of $26,675. The Company used $499,744 and $617,927 of cash from operations during the six months ended June 30, 2017 and 2016, respectively, which was funded primarily by proceeds from equity financings. There is no assurance that such financing will be available in the future. These factors raise substantial doubt about the Company’s ability to continue as a going concern within one year after the date that the financial statements are issued. The Company is currently pursuing the following sources of short and long-term working capital: 1. The Company is holding preliminary discussions with parties who are interested in licensing, purchasing the rights to or establishing a joint venture to commercialize applications of the Company’s technology. 2. The Company is seeking growth capital from certain strategic and/or government (grant) related sources. These sources may, pursuant to any agreements that may be developed in conjunction with such funding, assist in the product definition and design, roll-out and channel penetration of products. 3. The Company is holding discussions with investors and investment banks to obtain debt and/or equity financing. Any failure by the Company to timely procure additional financing or investment adequate to fund the ongoing operations, including planned product development initiatives and commercialization efforts, will have material adverse consequences on the Company’s financial condition, results of operations and cash flows as could any unfavorable terms. There are no assurances the Company will be able to obtain the financing and planned product development commercialization. Accordingly, the Company may not have the ability to continue as a going concern. The financial statements of the Company do not include any adjustments relating to the recoverability and classification of recorded assets, or the amounts and classifications of liabilities that might be necessary should the Company be unable to continue as a going concern.

Significant Accounting Policies

Significant Accounting Policies	6 Months Ended
	Jun. 30, 2017
Notes to Financial Statements
Note 3 - Significant Accounting Policies	In the opinion of management, all adjustments necessary for a fair statement of (a) the results of operations for the three and six month periods ended June 30, 2017 and 2016, (b) the financial position at June 30, 2017 and December 31, 2016, and (c) the cash flows for the six month periods ended June 30, 2017 and 2016, have been made. The significant accounting policies followed are: Use of estimates Significant estimates underlying the Company’s reported financial position and results of operations include the allowance for doubtful accounts, fair value of unit based compensation, fair value impairment analysis, valuation allowance on deferred taxes and the warranty reserve. Cash and cash equivalents Accounts receivable Other receivables Inventory Property and equipment Intangible assets Long-lived assets Government Funding Research and development expenses and funding proceeds Stock issuance costs Common stock Revenue recognition In certain instances, the Company’s ConsERV system product may carry a limited warranty of up to two years for all parts contained therein with the exception of the energy recovery ventilator core produced and sold by the Company. The distributor of the ConsERV system may carry a limited warranty of up to ten years. The limited warranty includes replacement of defective parts for the ConsERV system and includes workmanship and material failure for the ConsERV core. The Company recorded an accrual of $91,531 for future warranty expenses at June 30, 2017 and December 31, 2016, which is included in accrued expenses, other. Royalty revenue is recognized as earned. The Company recognized royalty revenue of $0 and $21,500 for the three months ended and $0 and $43,000 for the six months ended June 30, 2017 and 2016, respectively. Revenue derived from the sale of licenses is deferred and recognized as license fee revenue on a straight-line basis over the life of the license, or until the license arrangement is terminated. The Company recognized license fee revenue of $0 and $29,919 for the three months ended and $0 and $59,839 for the six months ended June 30, 2017 and 2016, respectively. The Company accounts for revenue arrangements with multiple elements under the provisions of the Financial Accounting Standards Boards (FASB) Accounting Standards Codification (ASC) Topic 605-25, “Revenue Recognition-Multiple-Element Arrangements.” In order to account for these agreements, the Company must identify the deliverables included within the agreement and evaluate which deliverables represent separate units of accounting based on if certain criteria are met, including whether the delivered element has stand-alone value to the licensee. The consideration received is allocated among the separate units of accounting, and the applicable revenue recognition criteria are applied to each of the separate units. Financial instruments Fair value Measurement and Disclosures” · Level 1 - Unadjusted quoted prices in active markets that are accessible at the measurement date for identical, unrestricted assets or liabilities. · Level 2 - Inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly or indirectly, including quoted prices for similar assets or liabilities in active markets; quoted prices for identical or similar assets or liabilities in markets that are not active; inputs other than quoted prices that are observable for the asset or liability (e.g. interest rates); and inputs that are derived principally from or corroborated by observable market data by correlation or other means. · Level 3 - Inputs that are both significant to the fair value measurement and unobservable. Income taxes The Company identifies and evaluates uncertain tax positions, if any, and recognizes the impact of uncertain tax positions for which there is a less than more-likely-than-not probability of the position being upheld when reviewed by the relevant taxing authority. Such positions are deemed to be unrecognized tax benefits and a corresponding liability is established on the balance sheet. The Company has not recognized a liability for uncertain tax positions. If there were unrecognized tax benefit, the Company would recognize interest accrued related to unrecognized tax benefits in interest expense and penalties in operating expenses. The Company’s 2013 through 2016 tax years remain open and subject to examination by the Internal Revenue Service. Derivative Liability Fair Value Measurements · Level 1 - Unadjusted quoted prices in active markets that are accessible at the measurement date for identical, unrestricted assets or liabilities. · Level 2 - Inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly or indirectly, including quoted prices for similar assets or liabilities in active markets; quoted prices for identical or similar assets or liabilities in markets that are not active; inputs other than quoted prices that are observable for the asset or liability (e.g. interest rates); and inputs that are derived principally from or corroborated by observable market data by correlation or other means. · Level 3 - Inputs that are both significant to the fair value measurement and unobservable. A financial asset or liability’s classification within the hierarchy is determined based on the lowest level input that is significant to the fair value measurement. The Company has recorded a derivative liability for its convertible notes which contain variable conversion prices. The table below summarizes the fair values of our financial liabilities as of June 30, 2017: Fair Value at June 30, Fair Value Measurement Using 2017 Level 1 Level 2 Level 3 Derivative liability $ 505,383 $ - $ - $ 505,383 The reconciliation of the derivative liability measured at fair value on a recurring basis using unobservable inputs (Level 3) is as follows for the six months ended June 30, 2017: Balance at beginning of period $ - Additions to derivative instruments 700,558 Gain on change in fair value of derivative liability (195,175 ) Balance at end of period $ 505,383 Loss per share Recent Accounting Pronouncements In May 2017, the FASB issued ASU 2017-09, “Compensation – Stock Compensation (Topic 718): Scope of Modification Accounting”, which clarifies when to account for a change to the terms or conditions of a share-based payment award as a modification. Under the new guidance, modification accounting is required only if the fair value, the vesting conditions, or the classification of the award changes as a result of the change in terms or conditions. If an award is not probable of vesting at the time a change is made, the new guidance clarifies that no new measurement date will be required if there is no change to the fair value, vesting conditions, and classification. This ASU will be applied prospectively and is effective for fiscal years beginning after December 15, 2017, and interim periods within those years, with early adoption permitted. The Company does not expect this standard to have a material impact on its financial statements. In February 2016, the FASB issued Accounting Standards Update No. 2016-02, Leases. The new standard establishes a right-of-use (ROU) model that requires a lessee to record a ROU asset and a lease liability on the balance sheet for all leases with terms longer than 12 months. Leases will be classified as either finance or operating, with classification affecting the pattern of expense recognition in the income statement. The new standard is effective for fiscal years beginning after December 15, 2018, including interim periods within those fiscal years. A modified retrospective transition approach is required for lessees for capital and operating leases existing at, or entered into after, the beginning of the earliest comparative period presented in the financial statements, with certain practical expedients available. The Company is currently evaluating the impact of the pending adoption of the new standard on its financial statements. In May 2014, the FASB issued Accounting Standards Update No. 2014-09, Revenue from Contracts with Customers (ASU 2014-09), which supersedes nearly all existing revenue recognition guidance under U.S. GAAP. The core principle of ASU 2014-09 is to recognize revenues when promised goods or services are transferred to customers in an amount that reflects the consideration to which an entity expects to be entitled for those goods or services. ASU 2014-09 defines a five step process to achieve this core principle and, in doing so, more judgement and estimates may be required within the revenue recognition process than are required under existing U.S. GAAP. The standard is effective for annual periods beginning after December 15, 2017, and interim periods therein, using either of the following transition methods: (i) a full retrospective approach reflecting the application of the standard in each prior reporting period with the option to elect certain practical expedients or (ii) a retrospective approach with the cumulative effect of initially adopting ASU 2014-09 recognized at the date of adoption (which includes additional footnote disclosures). In July 2015, the FASB voted to defer the effective date of ASU 2014-09 for all entities by one year. The Company is currently evaluating the impact of the adoption of ASU 2014-09 on its financial statements and has not yet determined the method by which it will adopt the standard in 2018.

Accrued Expenses

Accrued Expenses	6 Months Ended
	Jun. 30, 2017
Notes to Financial Statements
Note 4 - Accrued Expenses	Accrued expenses consist of the following: June 30, 2017 December 31, 2016 Accrued expenses, other $ 98,049 $ 127,653 Accrued warranty costs 91,531 91,531 Accrued interest 47,261 13,618 $ 236,841 $ 232,802

Related Party Transactions

Related Party Transactions	6 Months Ended
	Jun. 30, 2017
Notes to Financial Statements
Note 5 - Related Party Transactions	The Company rents a building that is owned by two stockholders of the Company, one of whom is the Chief Executive Officer. Rent expense for this building is $4,066 per month, including sales tax. The Company recognized rent expense related to this lease of $12,198 in each of the three months ended and $24,396 in each of the six months ended June 30, 2017 and 2016, respectively. The Company has accrued compensation due to the Chief Executive Officer as of June 30, 2017 and December 31, 2016 of $1,563,946 and $1,485,609, respectively, included in accrued compensation and related benefits in the accompanying balance sheets. On June 24, 2016, the Company entered into a Loan and Security Agreement (“Security Agreement”) with Patricia Tangredi (the “Holder”) pursuant to which the Company issued a Senior Secured Promissory Note for $150,000 (the “Note”). The interest rate is 12% per annum compounded daily with a minimum interest payment of $2,000. The Note grants the Holder a secured interest in the assets of the Company Ms. Tangredi is the wife of Timothy Tangredi, the Company’s CEO and stockholder, and therefore is a related party of the Company. Pursuant to the Note, the Company is to pay the Holder the principal amount of $150,000 plus all interest due thereon in accordance with terms and conditions of the Security Agreement on the earlier of: (i) the date upon which the Company secures funds, regardless of source, equal to or exceeding, in the aggregate, $1,000,000 or (ii) October 31, 2016. · On September 7, 2016, the parties amended the Loan and Security Agreement (“First Amendment”) whereby the principal amount was increased by $100,000. In addition, the Company issued on October 19, 2016, 200,000 shares of $.01 par value common stock in accordance with the terms of the First Amendment. As consideration for the modification to the Maturity Date of the Note, the Company was obligated to issue 20,000 shares of $.01 par value common stock which were issued on February 8, 2017. · On October 30, 2016, the parties amended the Loan and Security Agreement (“Second Amendment”) whereby the maturity date of the Note was amended to December 31, 2016. As consideration for the modification to the Maturity Date of the Note, the Company was obligated to issue 20,000 shares of $.01 par value common stock. · On November 28, 2016, the parties amended the Loan and Security Agreement (“Third Amendment”) whereby the principal amount was increased by $60,000, the minimum interest payment was increased to $9,000, and the Maturity Date of the Note was extended to January 20, 2017. In addition, the Company is obligated to issue 200,000 shares of $.01 par value common stock in accordance with the terms of the Third Amendment. As consideration for the modification to the Maturity Date of the Note, the Company is obligated to issue 20,000 shares of $.01 par value common stock. Both obligations to issue shares of common stock are recorded as interest expense and in current liabilities at December 31, 2016. The 220,000 shares of common stock were issued on February 8, 2017. · On December 27, 2016, the parties amended the Loan and Security Agreement (“Fourth Amendment”) whereby the principal amount was increased by $30,000, the minimum interest payment was increased to $11,000, and the Maturity Date of the Note was extended to February 15, 2017. In addition, the Company is obligated to issue 200,000 shares of $.01 par value common stock in accordance with the terms of the Fourth Amendment. As consideration for the modification to the Maturity Date of the Note, the Company is obligated to issue 20,000 shares of $.01 par value common stock. Both obligations to issue shares of common stock are recorded as interest expense and in current liabilities at December 31, 2016. The 220,000 shares of common stock were issued on February 8, 2017. · On February 3, 2017, the parties amended the Loan and Security Agreement (“Fifth Amendment”) whereby the principal amount was increased by $100,000, and the Maturity Date of the Note was extended to the earlier of (i) the date upon which the Company secures funds, regardless of source, equal to or exceeding, in the aggregate, $1,000,000 or (ii) March 15, 2017. As consideration for the additional proceeds and modification of the Maturity Date the Company issued to the related party a warrant to purchase one million shares of common stock with an exercise price of $0.01 with a ten-year exercise period (see Note 6 – Equity Transactions for further discussion). The Company is further obligated to issue 20,000 shares of $.01 par value common stock. The obligations to issue shares of common stock were recorded as interest expense and current liabilities. The 20,000 shares of common stock were issued on March 14, 2017. · On February 21, 2017, the parties amended the Loan and Security Agreement (“Sixth Amendment”) whereby the principal amount was increased by $125,000, and the Maturity Date of the Note was extended to the earlier of (i) the date upon which the Company secures funds, regardless of source, equal to or exceeding, in the aggregate, $1,000,000 or (ii) April 15, 2017. As consideration for the additional proceeds and modification of the Maturity Date the Company issued to the related party a warrant to purchase three million shares of common stock with an exercise price of $0.01 with a ten-year exercise period (see Note 6 – Equity Transactions for further discussion). The Company is further obligated to issue 20,000 shares of $.01 par value common stock valued at $800. The obligations to issue shares of common stock were recorded as interest expense and current liabilities at March 31, 2017. · On April 7, 2017, the parties amended the Loan and Security Agreement (“Seventh Amendment”) whereby the Maturity Date of the Note was extended to the earlier of (i) the date upon which the Company secures funds, regardless of source, equal to or exceeding, in the aggregate, $1,000,000 or (ii) May 31, 2017. The Company is further obligated to issue 20,000 shares of $.01 par value common stock valued at $1,000. The obligations to issue shares of common stock were recorded as interest expense and current liabilities at June 30, 2017. · On May 1, 2017, the parties amended the Loan and Security Agreement (“Eighth Amendment”) whereby the principal amount was increased by $20,000, and the Maturity Date of the Note was extended to the earlier of (i) the date upon which the Company secures funds, regardless of source, equal to or exceeding, in the aggregate, $1,000,000 or (ii) May 31, 2017. As consideration for the additional proceeds and modification of the Maturity Date the Company issued to the related party a warrant to purchase two hundred and fifty thousand shares of common stock with an exercise price of $0.01 with a ten-year exercise period (see Note 6 – Equity Transactions for further discussion). · On July 27, 2017, the partied amended the Loan and Security Agreement (“Ninth Amendment”) whereby the principal amount was increase by $80,000, and the Maturity Date of the Note was extended to the earlier of (i) the date upon which the Company secures funds, regardless of source, equal to or exceeding, in the aggregate, $1,000,000 or (ii) August 31, 2017. As consideration for the additional proceeds and modification of the Maturity Date the Company issued to the related party a warrant to purchase two hundred and fifty thousand shares of common stock with an exercise price of $0.01 with a ten-year exercise period (see Note 6 – Equity Transactions for further discussion). The Company is using the proceeds of the Note and the First, Third, Fourth, Fifth, Sixth, Seventh, Eighth, and Ninth Amendments for working capital purposes. Timothy N. Tangredi, our Chief Executive Officer and Chairman, is a founder and a member of the board of directors of Aegis BioSciences, LLC ("Aegis"). Mr. Tangredi currently owns 52% of Aegis' outstanding equity and spends approximately one to two days per month on Aegis business for which he is compensated by Aegis. Aegis has two exclusive, world-wide licenses from us under which it has the right to use and sell products containing our polymer technologies in biomedical and health care applications. Pursuant to the second license, Aegis is required to make royalty payments of 1.5% of the net sales price it receives with respect to any personal hygiene product, surgical drape or clothing products (the latter when employed in medical and animal related fields) and license revenue it receives should Aegis grant a sublicense to a third party. Aegis sold no such products nor has it received any licensing fees requiring a royalty payment be made to us. All obligations for such payments ended on June 2, 2015. On February 27, 2015, the Company, and Timothy N. Tangredi, the Company's Chief Executive Officer entered into an amendment to Mr. Tangredi's Amended and Restated Employment Agreement. Currently, the Company has non-interest bearing accrued compensation due to the Chief Executive Officer for deferred salaries earned and unpaid as described above. The amendment provides that, if at any time during a calendar year, the unpaid compensation is greater than $500,000, Mr. Tangredi must convert $100,000 of unpaid compensation into the Company's common stock during such calendar year. The conversion rate shall be equal to 75% of the average closing price for the Company's common stock for the 30 trading days prior to the date of conversion. The Company shall also pay to Mr. Tangredi a cash payment equal to 20% of the compensation income incurred as a result of the conversion. Further, at any time any "person" or "group" (as such terms are used in Sections 13(d) and 14(d) of the Securities On April 24, 2014, the Company entered into a Distribution Agreement (the "Distribution Agreement") with SoEX (Hong Kong) Industry & Investment Co., Ltd., a Hong Kong corporation ("Soex"). The Distribution Agreement wasa covenant included in a Securities Purchase Agreement, dated January 21, 2014, between the Company and Soex, pursuant to which Soex purchased 37,500,000 shares of the Company’s common stock, equal to approximately 31% of the issued and outstanding shares of common stock as of December 31, 2015. Pursuant to the Distribution Agreement, in exchange for $500,000 to be paid by October 20, 2014, royalty payments and a commitment from Soex to purchase nano-material membrane and other products from the Company, Soex obtained the right to distribute and market the Company’s products for incorporation in energy recovery ventilators sold and installed in commercial, industrial and residential buildings, transportation facilities and vehicles (the "Field") in mainland China, Hong Kong, Macao and Taiwan (the "Territory"). Further, Soex received an exclusive license in the Territory to use the Company’s intellectual property in the manufacture and sale of its products in the Field and Territory and to purchase its requirements of nano-material membrane only from the Company, subject to terms and conditions of the Distribution Agreement. During 2014, $50,000 of the $500,000 license fee was received. Pursuant to the Distribution Agreement, Soex was required to pay the Company $500,000, issue the Company 25% of the equity of a newly-created company, Soex (Beijing) Environmental Protection Technology Company Limited and pay the Company royalties. Soex only paid the Company $50,000 of the required $500,000, did not issue the required equity and did not pay any required royalties. Effective June 12, 2015, the Company’s Board of Directors ratified the termination of the Distribution Agreement, dated April 24, 2014, with Soex because of the breach of the Distribution Agreement by Soex. There are no early termination penalties for the termination of the Distribution Agreement. The remaining amount of deferred revenue was recognized as income upon the termination of the Distribution Agreement in June 2015. The Company is pursuing legal action against Soex for breach of the Distribution Agreement as well as the Securities Purchase Agreement entered into in January 2014 (see Note 8 Litigation for further discussion). In December 2015, the Company reported that it entered into a Share Exchange Agreement (the "Exchange Agreement"), dated as of December 24, 2015 but effective as of December 1, 2015, with Open Systems Control, a California corporation (the "Shareholder"), and Synpower Corporation. Ltd., a Hong Kong corporation ("Synpower") through the issuance of 1,000,000 of common stock at $.19 per share which was recorded as Investment in China Operating Company on the balance sheet at December 31,2015. Pursuant to the Exchange Agreement, the Company purchased from the Shareholder all of the equity ownership in Synpower. At the time of the Exchange Agreement, Synpower was the owner of 62% of Jixiun-Cast Ltd., an engineering company organized in the People's Republic of China ("Cast"). The Company's plan was to use Cast for its manufacturing and distribution operations in China. On March 7, 2016, the Company and Synpower rescinded the Exchange Agreement, as of December 1, 2015, as a result of the discovery of an undisclosed event, not discoverable in the due diligence, related to Cast's ability to function in China as an operating entity for the Company. As a result of the event, the Shareholder breached the representations, warranties and covenants made by the Shareholder in the Exchange Agreement. As a result of the rescission, which was agreed to by the Shareholder, the transaction was unwound as of December 1, 2015, the Company will return the equity interest in Synpower to an entity identified by the Shareholder, and the shares issued to the Shareholder were returned to the Company and will be cancelled pending final notification of cancellation from the Shareholder. As a result of the rescission and return of shares, the Company reduced the Investment in China Operating Company and recorded Treasury Stock of $190,000 during the three-month period ended March 31, 2016. The financial statements of Synpower and its subsidiary, Cast, were not consolidated with the Company’s 2015 financial statements for the period from December 1, 2015 through March 7, 2016 because the Company and Shareholder mutually rescinded the Exchange Agreement as of December 1, 2015 and the Company never had control of Synpower or Cast. The above terms and amounts are not necessarily indicative of the terms and amounts that would have been incurred had comparable transactions been entered into with independent parties.

Equity Transactions

Equity Transactions	6 Months Ended
	Jun. 30, 2017
Notes to Financial Statements
Note 6 - Equity Transactions	Preferred Stock On March 5, 2015, the Company amended its Certificate of Incorporation to increase the number of authorized shares to 250,000,000, consisting of 240,000,000 shares of common stock and 10,000,000 shares of preferred stock, and to cancel the designated but unissued Series A-D Preferred Stock and create a new series of preferred stock designated as the “Class A Preferred Stock”. There are no shares of Class A Preferred Stock currently issued by the Company. Any holder of Class A Preferred Stock shall entitle the holder thereof to 150 votes on all matters submitted to a vote of the stockholders of the Company. The Class A Preferred Stock is convertible into common stock at a conversion price equal to 75% of the average closing price of the Company’s common stock for the 30 trading days prior to the holder’s election to convert. Common Stock At December 31, 2014, the Company’s Board of Directors had authorized 200,000,000 shares of common stock with a par value of $0.01 to be issued in series with terms and conditions to be determined by the Board of Directors. In December 2014, the Company’s board of directors approved an amendment of the Company’s Amended and Restated Articles of Incorporation that increased the authorized number of the Company’s shares of common stock to 240,000,000. The amendment was subject to stockholder approval which was obtained in February 2015. During the six months ended June 30, 2017 and during the year ended December 31, 2016, the Company entered into a series of amendments to the Loan and Security Agreement entered into with a related party. (See Note 5, Related Party Transaction for further discussion). Under the terms of those amendments the Company has issued an aggregate of 480,000 shares of common stock Valued at $17,200 out of which $15,400 was recorded against debt due to related party. On November 30, 2016, the Company entered into a consulting agreement with an outside business consultant. Under the terms of the agreement, services commenced on December 1, 2016 and will continue for three months. The Company is to issue to the consultant $15,000 worth of restricted common stock per month based on the three-day average closing price per share of the month. All shares earned under the agreement are considered earned in full and beneficially owned as of November 30, 2016. On December 30, 2016, the Company issued 300,000 shares of common stock to the consultants in payment of the first month’s services. On January 17, 2017 and February 21, 2017 respectively, the Company issued each 300,000 shares of common stock in satisfaction of the consulting agreement total valued at $30,000 which was recorded against the debt due to related party. On March 14, 2017, the Company issued 1,028,568 shares of common stock, valued at $72,000, in payment of accrued expenses relating to legal services. On March 21, 2017, the Company entered into a consulting agreement with an outside business consultant. Under the terms of the agreement, the Company issued 3,000,000 shares of common stock, valued at $150,000, on April 3, 2017 in satisfaction of the consulting agreement. On April 1, 2017, the Company entered into a consulting agreement with an outside business consultant. Under the terms of the agreement, services commenced on April 1, 2017 and will continue for three months. The Company issued to the consultant 1,000,000 shares of common stock, valued at $30,000. All shares earned under the agreement are considered earned in full and beneficially owned as of May 9, 2017. On April 24, 2017, the Company entered into a consulting agreement with an outside business consultant. Under the terms of the agreement, services commenced on April 21, 2017 and will continue for five months. The Company issued to the consultant 1,000,000 shares of common stock, valued at $30,000. All shares earned under the agreement are considered earned in full and beneficially owned as of June 30, 2017. Options In June 2000, November 2009 and February 2015, the Company’s Board of Directors adopted, and the shareholders approved, the 2000 Plan, 2009 Plan and 2015 Plan, respectively (together the “Plans”). The Plans provide for the granting of options to qualified employees of the Company, independent contractors, consultants, directors, and other individuals. The Company’s Board of Directors approved and made available 11,093,886, 15,000,000 and 10,000,000 shares of common stock to be issued pursuant to the 2000 Plan, 2009 Plan and 2015 Plan, respectively. The Plans permit grants of options to purchase common shares authorized and approved by the Company’s Board of Directors. In the six months ended June 30, 2017, there were no options granted, 190,000 options expired/forfeited, and no options exercised. In the six months ended June 30, 2016, there were 2,340,000 granted and no options exercised. The following table summarizes the information relating to outstanding stock option activity during the six months ended June 30, 2017: Common Shares Weighted Average Exercise Price Weighted Average Contractual Term (in years) Aggregate Intrinsic Value Outstanding at December 31, 2016 18,842,558 $ 0.25 5.06 $ - Granted - - - Exercised - - - - Forfeited or expired (190,000 ) 0.41 - Outstanding at June 30, 2017 18,652,558 $ 0.25 4.64 $ - Exercisable at June 30, 2017 18,652,558 $ 0.25 4.64 $ - Stock compensation expense was $0 and $163,294 for the three and six months ended June 30, 2017 and 2016, respectively. As of June 30, 2017 and 2016, there was no unrecognized employee stock-based compensation expense related to non-vested stock options. Warrants At June 30, 2017, the Company had outstanding warrants to purchase the Company’s common stock which were issued in connection with stock purchases. Information relating to these warrants is summarized as follows: For the six months ended June 30, 2017, the Company had issued as an inducement to modify the terms of a related party note, warrants exercisable into shares of common stock of the Company. The warrants provide for the purchase of an aggregate of 4,250,000 shares of common stock with an exercise price of $0.01 with a ten-year exercise period. Under the guidance of ASC 480 Debt and ASC 815 Derivatives and Hedging, the Company determined that the warrants are free-standing equity instruments classified as equity on the date of issuance. The warrants were recorded at their initial fair totaling $133,729, recorded as a discount to the carrying value of the related party note, which has been fully amortized to interest expense at June 30, 2017. Warrants Remaining Number Outstanding Weighted Average Remaining Life (Years) Weighted Average Exercise Price Warrants-Stock Purchases 9,832,358 4.46 $ 0.20

Convertible Notes Payable

Convertible Notes Payable	6 Months Ended
	Jun. 30, 2017
Notes to Financial Statements
Note 7- Convertible Notes Payable	The Company’s convertible promissory noted at June 30, 2017 and December 31, 2016 are as follows: June 30, 2017 December 31, 2016 Convertible notes payable, bearing zero rate of interest $ 100,000 $ - Convertible note payable, bearing interest at 8% 135,713 - Convertible note payable, bearing interest at 8% 135,713 - Total 371,425 - Unamortized debt discount (331,941 ) - Unamortized deferred debt issuance cost (36,253 ) - Total 3,231 - Less: Current portion - - Long term portion 3,231 - On April 21, 2017, the Company issued a convertible note in the amount of $100,000. The note is convertible, at the option of the holder, into shares of the Company’s common stock at a per share price of $0.03, subject to adjustment as provided in the note. The note matures on April 21, 2020. The note contained original issue discount of $10,000 which is being amortized over the life of the note. The Company has also incurred costs of $27,500 related to the note, consisting of $5,000 of legal costs and $22,500 for a commitment fee. These costs are also being amortized over the life of the note. The commitment fee was paid with 750,000 shares of common stock with a value of $22,500. The Company also recorded debt discount of $90,000 related to the embedded derivative, as described in Note 8, which is being amortized over the life of the note. On May 17, 2017, the Company issued two convertible notes, each with a face amount of $135,712.50. The notes contain substantially the same terms. The notes and related accrued interest are convertible, at the option of the holders, into shares of the Company’s common stock at a conversion price of 60% of the lowest trading price for 15 days prior to conversion. The notes bear interest at 8% per year and mature on May 17, 2018. The notes contained original issue discount aggregating of $24,675 which is being amortized over the life of the notes. The Company has also incurred aggregate legal costs of $11,750 related to the notes. These costs are also being amortized over the life of the notes. The Company also recorded debt discount of $246,750 related to the embedded derivative, as described in Note 8 which is being amortized over the life of the note. During the three months ended June 30, 2017, the Company amortized $39,484 of debt discount and $2,997 of debt costs to interest expense. At June 30, 2017 unamortized debt discount was $331,941 and unamortized debt costs were $36,253.

Derivative Liabilities

Derivative Liabilities	6 Months Ended
	Jun. 30, 2017
Notes to Financial Statements
Note 8 - Derivative Liabilities	The Company has identified certain embedded derivatives related to its convertible notes. Since the notes are convertible into a variable number of shares or have a price reset feature, the conversion features of those notes are recorded as derivative liabilities. The accounting treatment of derivative financial instruments requires that the Company record fair value of the derivatives as of the inception date and to adjust to fair value as of each subsequent balance sheet date. April 2017 Note The Company identified embedded derivatives related to the conversion features of the April 2017 note. The accounting treatment of derivative financial instruments requires that the Company record the fair value of the derivatives as of the inception date of the note and to adjust the fair value as of each subsequent balance sheet date. The Company calculated the fair value of the embedded derivative at the inception of the note as $99,106, using the Black Scholes Model based on the following assumptions: (1) risk free interest rate of 1.5%; (2) dividend yield of 0%; (3) volatility factor of the expected market price of our common stock of 301%; and (4) an expected life of 3 years. The initial fair value of the embedded debt derivative was allocated $90,000 as debt discount, which will be amortized to interest expense over the original term of the note, with the balance of $9,106 charged to expense at issue date. During the three months ended June 30, 2017, the Company recorded income of $33,067 related to the change in the fair value of the derivative. The fair value of the embedded derivative was $66,040 at June 30, 2017, determined using the Black Scholes Model with the following assumptions: (1) risk free interest rate of 1.5%; (2) dividend yield of 0%; (3) volatility factor of the expected market price of our common stock of 316%; and (4) an expected life of 2.83 years. May 2017 Notes The Company identified embedded derivatives related to the conversion features of the May 2017 Notes. The accounting treatment of derivative financial instruments requires that the Company record the fair value of the derivatives as of the inception date of the note and to adjust the fair value as of each subsequent balance sheet date. The Company calculated the fair value of the embedded derivative at the inception of the notes as $597,160, using the Black Scholes Model based on the following assumptions: (1) risk free interest rate of 1.171%; (2) dividend yield of 0%; (3) volatility factor of the expected market price of our common stock of 486%; and (4) an expected life of 1 year. The initial fair value of the embedded debt derivative was allocated $246,750 as debt discount, which will be amortized to interest expense over the original term of the note, with the balance of $350,410 charged to expense at issue date. The Company has recorded additions to the derivative conversion liabilities related to the conversion feature attributable to interest accrued during the period. These additions totaled $4,291 for the three months ended June 30, 2017, and were charged to interest expense. During the three months ended June 30, 2017, the Company recorded income of $162,108 related to the change in the fair value of the derivative. The fair value of the embedded derivative was $439,343 at June 30, 2017, determined using the Black Scholes Model with the following assumptions: (1) risk free interest rate of 1.243%; (2) dividend yield of 0%; (3) volatility factor of the expected market price of our common stock of 419%; and (4) an expected life of 10.5 months.

Deferred Revenue

Deferred Revenue	6 Months Ended
	Jun. 30, 2017
Notes to Financial Statements
Note 9 - Deferred Revenue	On October 30, 2012, the Company and MG Energy LLC, a Delaware limited liability company (“MG Energy”), entered into a License and Supply Agreement (the “Agreement”), effective October 26, 2012. Pursuant to the Agreement, the Company licensed certain intellectual property and improvements to MG Energy, for use in the manufacture and sale of energy recovery ventilators (“ERV”) and certain other HVAC systems for installation in commercial, residential, or industrial buildings in North America and South America in exchange for the cancellation of $2,034,521 of debt due to MG Energy. Additionally, MG Energy agreed to purchase certain ConsERV products from the Company for MG Energy’s use, pursuant to the terms and conditions of the Agreement. Under the agreement, MG Energy was required to pay royalties, as defined, to the Company on the net sales of each product or system sold. Expiration of the Agreement was to occur upon the expiration of the last patent right for the licensed technology. The Company had identified all significant deliverables under the Agreement to be limited to the license for the intellectual property, and the supply services. In determining the units of accounting, the Company evaluated whether the license had stand-alone value to MG Energy based upon consideration of the relevant facts and circumstances of the Agreement. The Company determined that the license does not have stand-alone value to the licensee and, therefore, should be combined with the supply agreement as one unit of accounting. The initial payment for the license agreement was treated as an advance payment and recognized over the performance period of the supply agreement. Subsequently, MG Energy entered a sublicense agreement with Multistack, LLC a Minnesota limited liability company (“Multistack”). For the six months ended June 30, 2017 and 2016, Multistack LLC accounted for approximately 0% and 68% of sales revenue, respectively. On December 8, 2016, the Company, MG Energy, and Multistack, terminated the License and Supply Agreement (the “Agreement”), with mutual release. The License Agreement was terminated and all licenses, rights and obligations releasing all parties for any remaining services or payments. At the date of termination of the License Agreement, the amount of deferred revenue was recognized as royalty revenue in December 2016, and accordingly, no accounts receivable was due from Multistack for the periods ended June 30, 2017 and December 31, 2016, respectively. Deferred revenue for this agreement was $0 at June 30, 2017 and December 31, 2016, respectively. The Company recognized royalty revenue of $0 and $20,282 at June 30, 2017 and 2016, respectively. The Company recognized license revenue of $0 and $48,334 at June 30, 2017 and 2016, respectively.

Litigation

Litigation	6 Months Ended
	Jun. 30, 2017
Notes to Financial Statements
Note 10 - Litigation	From time to time, claims are made against us in the ordinary course of our business, which could result in litigation. Claims and associated litigation are subject to inherent uncertainties and unfavorable outcomes could occur, such as monetary damages, fines, penalties or injunctions prohibiting us from selling one or more products or engaging in other activities. The occurrence of an unfavorable outcome in any specific period could have a material adverse effect on our results of operations for that period or future periods. In the third quarter of 2015, we commenced an action for the cancellation of the 37,500,000 shares issued to Soex (the "Shares") in connection with a Securities Purchase Agreement, dated January 21, 2014 ("Soex SPA"), and 3,750,000 shares issued to Zan Investment Advisory Limited ("Zan"), which is affiliated with Soex through Aifan Liu, who was appointed as a Company board observer by SOEX and her husband, Xinghong Hua. Sharon Han, General Manager and Chairwoman of Soex, served on our board pursuant to the provisions of the Soex SPA. Ms. Han resigned from the Board of Directors effective February 1, 2016. On April 24, 2014, we entered into a Distribution Agreement (the "Distribution Agreement"), with Soex to distribute certain of our products in China. As we reported in our Form 10-K for the year ended December 31, 2014 and filed with the Securities and Exchange Commission on April 1, 2015, we were entitled to receive, pursuant to the Distribution Agreement, royalties and a $500,000 payment, of which $50,000 has been received, that was due on or before October 24, 2014. Further, we reported we have not received any royalties from Soex. Soex is in breach of the Distribution Agreement. As first reported in our Form 10-Q for the quarter ended June 30, 2015, we began pursuing legal action against Soex for breach of the Soex SPA and Distribution Agreement. On July 8, 2015, we filed a lawsuit in state courts in Florida against Soex and Zan. Pursuant to the Distribution Agreement, Soex is in material breach of the following: (1) Section 1(a) of the Distribution Agreement for Soex's failure to make a $225,000 payment to us for the appointment of Soex as the exclusive distributor of the Products in the Field and Territory (the "Distribution Payment Default") in accordance with the terms set forth in the Distribution Agreement. Such payment was due on October 20, 2014 (the "Payment Date"). (2) Section 8(b) of the Distribution Agreement for Soex's failure to make a $225,000 payment to us for the grant of the license and right to manufacture, sell, lease and distribute Products (excluding manufacture of MTM), and to use the Intellectual Property in connection therewith (the "License Payment Default" and, together with the Distribution Payment Default, the "Payment Default") in accordance with the terms set forth in the Distribution Agreement. Such payment was due on the Payment Date. (3) Section 15(b) of the Distribution Agreement for Soex's failure to issue to us 25% of the equity (the "Equity Default") of SOEX (Beijing) Environmental Protection Technology Company Limited (the "China Subsidiary"). Because of the material breaches, we terminated the Distribution Agreement. As provided in Section 14(e) of the Distribution Agreement, we have the right to enforce any obligation due to us by the Soex. As a result, Soex still must (a) pay the remaining $450,000 due under the Distribution Agreement and the amount of Royalties due, plus interest at 1.5% per month (18% per year) with interest accruing from the date that payment was due and (b) issue to us 25% of the equity of SOEX (Beijing) Environmental Protection Technology Company Limited. As provided in Section 14(b), neither us nor Soex shall be liable for compensation, reimbursement, or damages due to loss of profits on sales or anticipated sales or losses due to expenditures, investments or commitments made, or in connection with the establishment, development or maintenance of the business. Further, in consideration of the issuance of the Shares to Soex and the equity to Zan under the Soex SPA was the covenant that Soex would enter into a Distribution Agreement and establish a subsidiary in China and issue shares to us in the China Subsidiary. With Soex's Equity Default, Soex breached the Soex SPA and we are seeking return of the Shares from Soex in the lawsuit filed in July 2015. The litigation has been moved to the U.S. District Court for the Middle District of Florida where Soex has instituted a counterclaim (Civil Docket Case #: 8:15-CV-02362-MSS-EAJ). We believe we have a strong case against Soex because of its breaches of the agreements, however, we cannot make any predictions about the success of its action against Soex or whether or not Soex will have the assets to satisfy any judgment.

Significant Accounting Polici17

Significant Accounting Policies (Policies)	6 Months Ended
	Jun. 30, 2017
Significant Accounting Policies Policies
Use of estimates	The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. Significant estimates underlying the Company’s reported financial position and results of operations include the allowance for doubtful accounts, fair value of unit based compensation, fair value impairment analysis, valuation allowance on deferred taxes and the warranty reserve.
Cash and cash equivalents	For the purposes of the Statements of Cash Flows, the Company considers all highly liquid debt instruments with a maturity of three months or less to be cash equivalents. Cash and cash equivalents are maintained at financial institutions and, at times, balances may exceed federally insured limits. The Company has never experienced losses related to these balances.
Accounts receivable	Accounts receivable consist primarily of receivables from the sale of the Company’s ERV products and royalties due under license and supply agreements. The Company regularly reviews accounts receivable for any bad debt based on an analysis of the Company’s collection experience, customer credit worthiness and current economic trends. After all attempts to collect a receivable have failed, the receivable is written off against the allowance. Based on management’s review of accounts receivable, an allowance for doubtful accounts of $0 and $3,647 was recorded at June 30, 2017 and December 31, 2016, respectively.
Other receivables	Other receivables consist primarily of receivables from the U.S. Department of Defense and the U.S. Department of Energy (See Note 3 – Research and development expenses and funding proceeds). The Company prepares invoices as it meets funding program milestones. Based on management’s review of other receivables, management has determined that no allowance for uncollectibilty is necessary at June 30, 2017 and December 31, 2016.
Inventory	Inventory consists of raw materials, work-in-process and finished goods and is stated at the lower of cost, determined by first-in, first-out method, or market. Market is determined based on the net realizable value, with appropriate consideration given to obsolescence, excessive levels, deterioration and other factors. At June 30, 2017 and December 31, 2016, the Company had $68,041 and $72,059 of raw materials, $5,389 and $4,158 of in-process inventory, and $15,590 and $1,382 of finished inventory, respectively. A reserve is recorded for any inventory deemed excessive or obsolete. No reserve is considered necessary at June 30, 2017 and December 31, 2016.
Property and equipment	Property and equipment are recorded at cost. Depreciation is calculated using the straight-line method over the estimated useful lives of the assets ranging from 3 to 7 years. Leasehold improvements are amortized over the shorter of their estimated useful lives of 5 years or the related lease term. Depreciation expense was $10,456 and $16,603 for the three months ended and $20,958 and $33,002 for the six months ended June 30, 2017 and 2016, respectively. Gains and losses upon disposition are reflected in the Statements of Operations in the period of disposition. Maintenance and repair expenditures are charged to expense as incurred.
Intangible assets	Identified intangible assets are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount may not be recoverable. The Company’s existing intangible assets consist solely of patents. Patents are amortized over their estimated useful or economic lives of 17 to 20 years. Patent amortization expense was $5,429 and $4,447 for the three months ended and $11,768 and $10,057 for the six months ended June 30, 2017 and 2016, respectively. Based on current capitalized costs, total patent amortization expense is estimated to be approximately $12,000 per year for the next four years.
Long-lived assets	Long-lived assets are reviewed for impairment whenever events or changes in circumstances indicate that the book value of the asset may not be recoverable. The Company periodically evaluates whether events and circumstances have occurred that indicate possible impairment. When impairment indicators exist, the Company estimates the future undiscounted net cash flows of the related asset or asset group over the remaining life in measuring whether or not the asset values are recoverable. The Company did not recognize impairment on its long-lived assets during the three and six months ended June 30, 2017 and 2016.
Government funding	Government funding represents grants from the U.S. Department of Defense and U.S. Department of Energy and are recognized when there is reasonable assurance that the funding will be received and conditions associated with the funding are met. When fundings are received related to property and equipment, the Company reduces the basis of the assets on the balance sheet, resulting in lower depreciation expense over the life of the associated asset. When fundings are received, which relate to expense reimbursement they are recorded as a reduction of the associated expense in the period in which the expense is incurred.
Research and development expenses and funding proceeds	Expenditures for research and development are expensed as incurred. The Company incurred research and development costs of $108,672 and $252,997 for the three months ended and $295,496 and $588,266 for the six months ended June 30, 2017 and 2016, respectively. The Company accounts for proceeds received from government fundings for research as a reduction in research and development costs. The Company recorded proceeds against research and development expenses on the Statements of Operations of $12,570 and $162,017 for the three months ended and $132,476 and $310,655 for the six months ended June 30, 2017 and 2016, respectively.
Stock issuance costs	Stock issuance costs are recorded as a reduction of the related proceeds through a charge to stockholders’ equity.
Common stock	The Company records common stock issuances when all of the legal requirements for the issuance of such common stock have been satisfied.
Revenue recognition	The Company recognizes revenue when the following criteria have been met: persuasive evidence of an arrangement exists, no significant Company obligations remain, collection of the related receivable is reasonably assured, and the fees are fixed or determinable. The Company acts as a principal in its revenue transactions as the Company is the primary obligor in the transactions. Generally, the Company recognizes revenue for its products upon shipment to customers, provided no significant obligations remain and collection is probable. In certain instances, the Company’s ConsERV system product may carry a limited warranty of up to two years for all parts contained therein with the exception of the energy recovery ventilator core produced and sold by the Company. The distributor of the ConsERV system may carry a limited warranty of up to ten years. The limited warranty includes replacement of defective parts for the ConsERV system and includes workmanship and material failure for the ConsERV core. The Company recorded an accrual of $91,531 for future warranty expenses at June 30, 2017 and December 31, 2016, which is included in accrued expenses, other. Royalty revenue is recognized as earned. The Company recognized royalty revenue of $0 and $21,500 for the three months ended and $0 and $43,000 for the six months ended June 30, 2017 and 2016, respectively. Revenue derived from the sale of licenses is deferred and recognized as license fee revenue on a straight-line basis over the life of the license, or until the license arrangement is terminated. The Company recognized license fee revenue of $0 and $29,919 for the three months ended and $0 and $59,839 for the six months ended June 30, 2017 and 2016, respectively. The Company accounts for revenue arrangements with multiple elements under the provisions of the Financial Accounting Standards Boards (FASB) Accounting Standards Codification (ASC) Topic 605-25, “Revenue Recognition-Multiple-Element Arrangements.” In order to account for these agreements, the Company must identify the deliverables included within the agreement and evaluate which deliverables represent separate units of accounting based on if certain criteria are met, including whether the delivered element has stand-alone value to the licensee. The consideration received is allocated among the separate units of accounting, and the applicable revenue recognition criteria are applied to each of the separate units.
Financial instruments	The Company accounts for financial instruments in accordance with FASB Accounting Standards Codification (ASC) 820 “ Fair value Measurement and Disclosures” · Level 1 - Unadjusted quoted prices in active markets that are accessible at the measurement date for identical, unrestricted assets or liabilities. · Level 2 - Inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly or indirectly, including quoted prices for similar assets or liabilities in active markets; quoted prices for identical or similar assets or liabilities in markets that are not active; inputs other than quoted prices that are observable for the asset or liability (e.g. interest rates); and inputs that are derived principally from or corroborated by observable market data by correlation or other means. · Level 3 - Inputs that are both significant to the fair value measurement and unobservable.
Income taxes	Income taxes are provided for the tax effects of transactions reported in the financial statements and consist of taxes currently due plus deferred taxes resulting from temporary differences. Such temporary differences result from differences in the carrying value of assets and liabilities for tax and financial reporting purposes. The deferred tax assets and liabilities represent the future tax consequences of those differences, which will either be taxable or deducible when the assets and liabilities are recovered or settled. Valuation allowances are established when necessary to reduce deferred tax assets to the amount expected to be realized. The Company identifies and evaluates uncertain tax positions, if any, and recognizes the impact of uncertain tax positions for which there is a less than more-likely-than-not probability of the position being upheld when reviewed by the relevant taxing authority. Such positions are deemed to be unrecognized tax benefits and a corresponding liability is established on the balance sheet. The Company has not recognized a liability for uncertain tax positions. If there were unrecognized tax benefit, the Company would recognize interest accrued related to unrecognized tax benefits in interest expense and penalties in operating expenses. The Company’s 2013 through 2016 tax years remain open and subject to examination by the Internal Revenue Service.
Derivative Liability	The Company has financial instruments that are considered derivatives or contain embedded features subject to derivative accounting. Embedded derivatives are valued separately from the host instrument and are recognized as derivative liabilities in the Company’s balance sheet. The Company measures these instruments at their estimated fair value and recognizes changes in their estimated fair value in results of operations during the period of change.
Fair Value Measurements	The Company accounts for financial instruments in accordance with FASB Accounting Standards Codification (ASC) 820 “Fair value Measurement and Disclosures” (ASC 820). ASC 820 defines fair value, establishes a framework for measuring fair value and expands disclosures about fair value measurements. ASC 820 defines fair value as the exchange price that would be received for an asset or paid to transfer a liability (an exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date. ASC 820 also establishes a fair value hierarchy that distinguishes between (1) market participant assumptions developed based on market data obtained from independent sources (observable inputs) and (2) an entity’s own assumptions about market participant assumptions developed based on the best information available in the circumstances (unobservable inputs). The fair value hierarchy consists of three broad levels, which gives the highest priority to unadjusted quoted prices in active markets for identical assets or liabilities (Level 1) and the lowest priority to unobservable inputs (Level 3). The three levels of the fair value hierarchy are described below: · Level 1 - Unadjusted quoted prices in active markets that are accessible at the measurement date for identical, unrestricted assets or liabilities. · Level 2 - Inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly or indirectly, including quoted prices for similar assets or liabilities in active markets; quoted prices for identical or similar assets or liabilities in markets that are not active; inputs other than quoted prices that are observable for the asset or liability (e.g. interest rates); and inputs that are derived principally from or corroborated by observable market data by correlation or other means. · Level 3 - Inputs that are both significant to the fair value measurement and unobservable. A financial asset or liability’s classification within the hierarchy is determined based on the lowest level input that is significant to the fair value measurement. The Company has recorded a derivative liability for its convertible notes which contain variable conversion prices. The table below summarizes the fair values of our financial liabilities as of June 30, 2017: Fair Value at June 30, Fair Value Measurement Using 2017 Level 1 Level 2 Level 3 Derivative liability $ 505,383 $ - $ - $ 505,383 The reconciliation of the derivative liability measured at fair value on a recurring basis using unobservable inputs (Level 3) is as follows for the six months ended June 30, 2017: Balance at beginning of period $ - Additions to derivative instruments 700,558 Gain on change in fair value of derivative liability (195,175 ) Balance at end of period $ 505,383
Loss per share	Basic loss per share is computed by dividing net loss attributable to common stockholders by the weighted average common shares outstanding for the period. Diluted loss per share is computed giving effect to all potentially dilutive common shares. Potentially dilutive common shares may consist of incremental shares issuable upon the exercise of stock options and warrants. In periods in which a net loss has been incurred, all potentially dilutive common shares are considered anti-dilutive and are excluded from the calculation. Common share equivalents of 28,487,916 and 25,790,416 were excluded from the computation of diluted earnings per share for the three and six months ended June 30, 2017 and 2016, respectively, because their effect is anti-dilutive.
Recent accounting pronouncements	There are new accounting pronouncements issued by the Financial Accounting Standards Board (“FASB”) which are not yet effective as follows: In May 2017, the FASB issued ASU 2017-09, “Compensation – Stock Compensation (Topic 718): Scope of Modification Accounting”, which clarifies when to account for a change to the terms or conditions of a share-based payment award as a modification. Under the new guidance, modification accounting is required only if the fair value, the vesting conditions, or the classification of the award changes as a result of the change in terms or conditions. If an award is not probable of vesting at the time a change is made, the new guidance clarifies that no new measurement date will be required if there is no change to the fair value, vesting conditions, and classification. This ASU will be applied prospectively and is effective for fiscal years beginning after December 15, 2017, and interim periods within those years, with early adoption permitted. The Company does not expect this standard to have a material impact on its financial statements. In February 2016, the FASB issued Accounting Standards Update No. 2016-02, Leases. The new standard establishes a right-of-use (ROU) model that requires a lessee to record a ROU asset and a lease liability on the balance sheet for all leases with terms longer than 12 months. Leases will be classified as either finance or operating, with classification affecting the pattern of expense recognition in the income statement. The new standard is effective for fiscal years beginning after December 15, 2018, including interim periods within those fiscal years. A modified retrospective transition approach is required for lessees for capital and operating leases existing at, or entered into after, the beginning of the earliest comparative period presented in the financial statements, with certain practical expedients available. The Company is currently evaluating the impact of the pending adoption of the new standard on its financial statements. In May 2014, the FASB issued Accounting Standards Update No. 2014-09, Revenue from Contracts with Customers (ASU 2014-09), which supersedes nearly all existing revenue recognition guidance under U.S. GAAP. The core principle of ASU 2014-09 is to recognize revenues when promised goods or services are transferred to customers in an amount that reflects the consideration to which an entity expects to be entitled for those goods or services. ASU 2014-09 defines a five step process to achieve this core principle and, in doing so, more judgement and estimates may be required within the revenue recognition process than are required under existing U.S. GAAP. The standard is effective for annual periods beginning after December 15, 2017, and interim periods therein, using either of the following transition methods: (i) a full retrospective approach reflecting the application of the standard in each prior reporting period with the option to elect certain practical expedients or (ii) a retrospective approach with the cumulative effect of initially adopting ASU 2014-09 recognized at the date of adoption (which includes additional footnote disclosures). In July 2015, the FASB voted to defer the effective date of ASU 2014-09 for all entities by one year. The Company is currently evaluating the impact of the adoption of ASU 2014-09 on its financial statements and has not yet determined the method by which it will adopt the standard in 2018.

Significant Accounting Polici18

Significant Accounting Policies (Tables)	6 Months Ended
	Jun. 30, 2017
Significant Accounting Policies Tables
Significant to the fair value measurement	Fair Value at June 30, Fair Value Measurement Using 2017 Level 1 Level 2 Level 3 Derivative liability $ 505,383 $ - $ - $ 505,383
Reconciliation of the derivative liability measured	Balance at beginning of period $ - Additions to derivative instruments 700,558 Gain on change in fair value of derivative liability (195,175 ) Balance at end of period $ 505,383

Accrued Expenses (Tables)

Accrued Expenses (Tables)	6 Months Ended
	Jun. 30, 2017
Accrued Expenses Tables
Accrued Expenses	June 30, 2017 December 31, 2016 Accrued expenses, other $ 98,049 $ 127,653 Accrued warranty costs 91,531 91,531 Accrued interest 47,261 13,618 $ 236,841 $ 232,802

Equity Transactions (Tables)

Equity Transactions (Tables)	6 Months Ended
	Jun. 30, 2017
Equity Transactions Tables
Outstanding stock options activity	Common Shares Weighted Average Exercise Price Weighted Average Contractual Term (in years) Aggregate Intrinsic Value Outstanding at December 31, 2016 18,842,558 $ 0.25 5.06 $ - Granted - - - Exercised - - - - Forfeited or expired (190,000 ) 0.41 - Outstanding at June 30, 2017 18,652,558 $ 0.25 4.64 $ - Exercisable at June 30, 2017 18,652,558 $ 0.25 4.64 $ -
Warrants	Warrants Remaining Number Outstanding Weighted Average Remaining Life (Years) Weighted Average Exercise Price Warrants-Stock Purchases 9,832,358 4.46 $ 0.20

Convertible Notes Payable (Tabl

Convertible Notes Payable (Tables)	6 Months Ended
	Jun. 30, 2017
Convertible Notes Payable Tables
Convertible Notes Payable	The Company’s convertible promissory noted at June 30, 2017 and December 31, 2016 are as follows: June 30, 2017 December 31, 2016 Convertible notes payable, bearing zero rate of interest $ 100,000 $ - Convertible note payable, bearing interest at 8% 135,713 - Convertible note payable, bearing interest at 8% 135,713 - Total 371,425 - Unamortized debt discount (331,941 ) - Unamortized deferred debt issuance cost (36,253 ) - Total 3,231 - Less: Current portion - - Long term portion 3,231 -

Going Concern and Management'22

Going Concern and Management's Plans (Details Narrative) - USD ($)	3 Months Ended		6 Months Ended
	Jun. 30, 2017	Jun. 30, 2016	Jun. 30, 2017	Jun. 30, 2016	Dec. 31, 2016	Dec. 31, 2015
Going Concern And Managements Plans Details Narrative
Net loss	$ (951,335)	$ (543,228)	$ (1,425,610)	$ (932,982)
Accumulated deficit	(45,090,096)		(45,090,096)		$ (43,664,486)
Stockholders' deficit	(3,137,865)		(3,137,865)		(2,167,684)
Net cash used by operating activities			(499,744)	(617,927)
Cash and cash equivalents	$ 26,675	$ 185,514	$ 26,675	$ 185,514	$ 21,066	$ 698,754

Significant Accounting Polici23

Significant Accounting Policies (Details) - USD ($)	Jun. 30, 2017	Dec. 31, 2016
Derivative Liability	$ 505,383
Level 1 [Member]
Derivative Liability
Level 3 [Member]
Derivative Liability	$ 505,383

Significant Accounting Polici24

Significant Accounting Policies (Details 1) - USD ($)	6 Months Ended
	Jun. 30, 2017	Jun. 30, 2016
Significant Accounting Policies Details 1
Balance at beginning of period
Additions to derivative instruments	700,558
Gain on change in fair value of derivative liability	(195,175)
Balance at end of period	$ 505,383

Significant Accounting Polici25

Significant Accounting Policies (Details Narrative) - USD ($)	3 Months Ended		6 Months Ended
	Jun. 30, 2017	Jun. 30, 2016	Jun. 30, 2017	Jun. 30, 2016	Dec. 31, 2016
Allowance for doubtful accounts	$ 0		$ 0		$ 3,647
Inventory raw materials	68,041		68,041		72,059
Inventory in process	5,389		5,389		4,158
Inventory finished goods	15,590		15,590		1,382
Depreciation expense	10,456	$ 16,603	20,958	$ 33,002
Patent amortization expense	5,429	4,447	11,768	10,057
Future amortization expense, 2018	12,000		12,000
Future amortization expense, 2019	12,000		12,000
Future amortization expense, 2020	12,000		12,000
Future amortization expense, 2021	12,000		12,000
Research and development costs, incurred	108,672	252,997	295,496	588,266
Research and development expenses, net of government grant	12,570	162,017	132,476	310,655
Accrued warranty costs	91,531		91,531		$ 91,531
Revenue recognition from license agreements	0	29,919	0	59,839
Revenue recognition from royalties	$ 0	$ 21,500	$ 0	$ 43,000
Common share excluded from diluted earnings per share	28,487,916	25,790,416	28,487,916	25,790,416
Minimum [Member]
Property and equipment estimated useful life			3 years
Patents estimated useful life			17 years
Maximum [Member]
Property and equipment estimated useful life			7 years
Patents estimated useful life			20 years
Leasehold Improvements [Member]
Property and equipment estimated useful life			5 years

Accrued Expenses (Details)

Accrued Expenses (Details) - USD ($)	Jun. 30, 2017	Dec. 31, 2016
Accrued Expenses Details
Accrued expenses, other	$ 98,049	$ 127,653
Accrued warranty costs	91,531	91,531
Accrued interest	47,261	13,618
Accrued Expenses	$ 238,641	$ 232,802

Related Party Transactions (Det

Related Party Transactions (Details Narrative) - USD ($)

May 01, 2017

Apr. 07, 2017

Jul. 27, 2017

May 17, 2017

Apr. 21, 2017

Feb. 21, 2017

Feb. 03, 2017

Dec. 27, 2016

Nov. 28, 2016

Jun. 24, 2016

Feb. 27, 2015

Oct. 20, 2014

Apr. 24, 2014

Jun. 30, 2017

Jun. 30, 2016

Jun. 30, 2017

Jun. 30, 2016

Dec. 31, 2016

Dec. 31, 2014

Mar. 14, 2017

Feb. 08, 2017

Oct. 30, 2016

Oct. 19, 2016

Sep. 07, 2016

Dec. 31, 2015

Rent expense

$ 12,198

$ 12,198

$ 24,396

$ 24,396

Senior secured Promissory Note

$ 150,000

Senior secured interest rate

12.00%

Senior secured minimum interest payment

$ 2,000

Principal loan amount

$ 150,000

Debt instrument maturity date

May 17, 2018

Apr. 21, 2020

Accrued compensation

$ 1,563,946

$ 1,563,946

$ 1,485,609

Common stock shares issued

750,000

128,158,645

128,158,645

121,300,077

1,028,568

Common stock par value per share

$ 0.01

$ 0.01

$ 0.01

Treasury stock recorded in China Operating Company

190,000

Lease term description

The lease term will terminate upon 30 days' written notice from landlord or 90 days written termination from us.

Security Agreement description

(i) the date upon which the Company secures funds, regardless of source, equal to or exceeding, in the aggregate, $1,000,000 or (ii) October 31, 2016.

Common stock, valued

$ 22,500

$ 1,281,587

$ 1,281,587

$ 1,213,001

$ 72,000

Soex [Member]

License fee received

$ 50,000

Total license fee received to be recovered

$ 500,000

Royality payments paid

$ 500,000

$ 500,000

Purchased outstanding shares

37,500,000

Purchased issued and outstanding shares approximate percentage

31.00%

Distribution agreement description

Soex was required to pay the Company $500,000, issue the Company 25% of the equity of a newly-created company, Soex (Beijing) Environmental Protection Technology Company Limited and pay the Company royalties. Soex only paid the Company $50,000 of the required $500,000, did not issue the required equity and did not pay any required royalties. Effective June 12, 2015, the Company’s Board of Directors ratified the termination of the Distribution Agreement, dated April 24, 2014, with Soex as a result of a breach of the Distribution Agreement by Soex.

Synpower [Member]

Common stock shares issued

1,000,000

Equity ownership percentage

62.00%

Issuance of common stock for Investment in China Operating Company, Per Shares

$ 0.19

Building [Member]

Monthly rent expense

$ 4,066

Loan and Security Agreement Ninth Amendment [Member]

Principal loan amount increased

$ 80,000

Security Agreement description

(i) the date upon which the Company secures funds, regardless of source, equal to or exceeding, in the aggregate, $1,000,000 or (ii) August 31, 2017

Exercise price

$ 0.01

Common stock shares issued period

10 years

Common stock shares purchase

250,000

Loan and Security Agreement Eighth Amendment [Member]

Principal loan amount increased

$ 20,000

Security Agreement description

(i) the date upon which the Company secures funds, regardless of source, equal to or exceeding, in the aggregate, $1,000,000 or (ii) May 31, 2017

Exercise price

$ 0.01

Common stock shares issued period

10 years

Common stock shares purchase

250,000

Loan and Security Agreement Seventh Amendment [Member]

Common stock shares issued

20,000

Common stock par value per share

$ .01

Security Agreement description

(i) the date upon which the Company secures funds, regardless of source, equal to or exceeding, in the aggregate, $1,000,000 or (ii) May 31, 2017

Common stock, valued

$ 1,000

Loan and Security Agreement Sixth Amendment [Member]

Principal loan amount increased

$ 125,000

Common stock shares issued

20,000

Common stock par value per share

$ 0.01

Security Agreement description

(i) the date upon which the Company secures funds, regardless of source, equal to or exceeding, in the aggregate, $1,000,000 or (ii) April 15, 2017

Exercise price

$ 0.01

Common stock shares issued period

10 years

Common stock shares purchase

3,000,000

Common stock, valued

$ 800

Loan and Security Agreement Fifth Amendment [Member]

Principal loan amount increased

$ 100,000

Common stock shares issued

20,000

20,000

Common stock par value per share

$ 0.01

Security Agreement description

(i) the date upon which the Company secures funds, regardless of source, equal to or exceeding, in the aggregate, $1,000,000 or (ii) March 15, 2017

Exercise price

$ 0.01

Common stock shares issued period

10 years

Common stock shares purchase

1,000,000

Loan and Security Agreement Fourth Amendment [Member]

Principal loan amount increased

$ 30,000

Principal loan amount minimum interest payment

$ 11,000

Debt instrument maturity date

Feb. 15, 2017

Common stock shares issued

200,000

20,000

220,000

Common stock par value per share

$ .01

$ 0.01

Loan and Security Agreement Third Amendment [Member]

Principal loan amount increased

$ 60,000

Principal loan amount minimum interest payment

$ 9,000

Debt instrument maturity date

Jan. 20, 2017

Common stock shares issued

200,000

20,000

220,000

Common stock par value per share

$ 0.01

$ 0.01

Loan and Security Agreement Second Amendment [Member]

Common stock shares issued

20,000

Common stock par value per share

$ 0.01

Loan and Security Agreement First Amendment [Member]

Principal loan amount increased

$ 100,000

Common stock shares issued

20,000

200,000

Common stock par value per share

$ 0.01

$ .01

Timothy N. Tangredi CEO [Member]

Unpaid compensation conversion into common stock amount

$ 100,000

$ 100,000

Conversion rate of common stock description

The conversion rate shall be equal to 75% of the average closing price for the Company's common stock for the 30 trading days prior to the date of conversion. The Company shall also pay to Mr. Tangredi a cash payment equal to 20% of the compensation income incurred as a result of the conversion.

Royalty payments percentage

1.50%

1.50%

Accrued compensation, description

the unpaid compensation is greater than $500,000

Equity ownership percentage

52.00%

52.00%

Timothy N. Tangredi CEO [Member] | Class A Convertible Preferred Stock [Member]

Common stock par value per share

$ 1.50

Voting equity rate beneficial owner

40.00%

Equity Transactions (Details)

Equity Transactions (Details)	6 Months Ended
	Jun. 30, 2017USD ($)$ / sharesshares
Information relating to outstanding stock options activity with employees
Outstanding, Beginning Balance | shares	18,842,558
Common shares granted | shares
Common shares exercised | shares
Common shares expired/forfeited | shares	(190,000)
Outstanding, Ending Balance | shares	18,652,558
Exercisable, Ending Balance | shares	18,652,558
Weighted average exercise price of shares outstanding, Beginning Balance | $ / shares	$ 0.25
Weighted average exercise price of shares Granted | $ / shares
Weighted average exercise price of shares exercised | $ / shares
Weighted average exercise price of shares expired/forfeited | $ / shares	0.41
Weighted average exercise price of shares outstanding, Ending Balance | $ / shares	0.25
Weighted average exercise price of shares exercisable, Ending Balance | $ / shares	$ 0.25
Weighted average remaining contractual term (in years) of shares outstanding, Begining Balance	5 years 22 days
Weighted average remaining contractual term (in years) of shares outstanding, Ending Balance	4 years 7 months 21 days
Weighted average remaining contractual term (in years) of shares exercisable, Ending Balance	4 years 7 months 21 days
Aggregate intrinsic value of shares outstanding, Beggining Balance | $
Aggregate intrinsic value of shares outstanding, Ending Balance | $
Aggregate intrinsic value of shares exerciseable | $

Equity Transactions (Details 1)

Equity Transactions (Details 1)	6 Months Ended
	Jun. 30, 2017USD ($)$ / shares
Weighted Average Remaining Life	4 years 7 months 21 days
Warrants Stock Purchases [Member]
Remaining Number Outstanding | $	$ 9,832,358
Weighted Average Remaining Life	4 years 5 months 16 days
Weighted Average Exercise Price | $ / shares	$ 0.20

Equity Transactions (Details Na

Equity Transactions (Details Narrative) - USD ($)	Mar. 05, 2015	Feb. 21, 2017	Jan. 17, 2017	Nov. 30, 2016	Jun. 30, 2017	Jun. 30, 2016	Jun. 30, 2017	Jun. 30, 2016	Apr. 24, 2017	Apr. 21, 2017	Mar. 21, 2017	Mar. 14, 2017	Dec. 31, 2016	Dec. 30, 2016	Feb. 28, 2015	Dec. 31, 2014	Nov. 30, 2009	Jun. 30, 2000
Common stock par value					$ 0.01		$ 0.01						$ 0.01
Common stock shares issued					128,158,645		128,158,645			750,000		1,028,568	121,300,077
Common stock shares authorized	240,000,000				240,000,000		240,000,000						240,000,000
Preferred stock shares authorized	10,000,000
Conversion price common stock	conversion price equal to 75% of the average closing price
Issue shares							$ 304,500
Common shares expired/forfeited							(190,000)
Stock based compensation expense							$ 180,000	$ 163,294
Common stock, valued					$ 1,281,587		1,281,587			$ 22,500		$ 72,000	$ 1,213,001
Issuance of warrants for debt modification							133,729
Due to related party debt
Common Stock
Issue shares							$ 63,786
Aggregate shares issued					480,000		480,000
Common stock, valued					$ 17,200		$ 17,200
Due to related party debt							$ 15,400
Preferred Stock [Member]
Increase number of authorized shares	250,000,000
Options [Member]
Common shares expired/forfeited							190,000	2,340,000
Stock based compensation expense					$ 0	$ 163,294	$ 0	$ 163,294
Warrant [Member]
Common stock shares issued period							10 years
Exercise price					$ 0.01		$ 0.01
Common stock shares purchase							4,250,000
Issuance of warrants for debt modification							$ 133,729
Consultants [Member]
Common stock shares issued		300,000	300,000						1,000,000		3,000,000			300,000
Common stock, valued									$ 30,000		$ 150,000
Due to related party debt		$ 30,000	$ 30,000
Investors [Member] | Restricted Stock [Member]
Issue shares				$ 15,000
Board of Directors [Member]
Common stock par value																$ 0.01
Common stock shares authorized																200,000,000
Board of Directors [Member] | Common Stock
Increase number of authorized shares																240,000,000
Board of Directors [Member] | Options [Member] | 2000 Plan [Member]
Common stock shares issued																		11,093,886
Board of Directors [Member] | Options [Member] | 2009 Plan [Member]
Common stock shares issued																	15,000,000
Board of Directors [Member] | Options [Member] | 2015 Plan [Member]
Common stock shares issued															10,000,000
Apr.1. 2017 [Member] | Consultants [Member]
Common stock shares issued					1,000,000		1,000,000
Common stock, valued					$ 30,000		$ 30,000

Convertible Notes Payable (Deta

Convertible Notes Payable (Details) - USD ($)	Jun. 30, 2017	Dec. 31, 2016
Total	$ 371,425
Unamortized debt discount	(331,941)
Unamortized deferred debt issuance cost	(36,253)
Total	3,231
Less: Current portion
Long term portion	3,231
Convertible Notes Payable [Member]
Total	100,000
Convertible Notes Payable One [Member]
Total	135,713
Convertible Notes Payable Two [Member]
Total	$ 135,713

Convertible Notes Payable (De32

Convertible Notes Payable (Details Narrative) - USD ($)	1 Months Ended		3 Months Ended	6 Months Ended
	May 17, 2017	Apr. 21, 2017	Jun. 30, 2017	Jun. 30, 2017	Jun. 30, 2016	Mar. 14, 2017	Dec. 31, 2016
Convertible Notes Payable	$ 135,713	$ 100,000
Common stock price per share		$ 0.03
Maturity date	May 17, 2018	Apr. 21, 2020
Amortized original issue discount	$ 24,675	$ 10,000	$ 2,997	$ 2,997
Incurred costs		27,500
Legal costs	$ 11,750	5,000
Commitment fee		$ 22,500
Common stock shares issued		750,000	128,158,645	128,158,645		1,028,568	121,300,077
Common stock, valued		$ 22,500	$ 1,281,587	$ 1,281,587		$ 72,000	$ 1,213,001
Description of conversion price	common stock at a conversion price of 60% of the lowest trading price for 15 days prior to conversion
Interest rate	8.00%
Debt discount	$ 246,750	$ 90,000	39,484	39,484
Unamortized debt discount			331,941	331,941
Unamortized deferred debt issuance cost			$ 36,253	$ 36,253
Convertible Notes Payable One [Member]
Interest rate			8.00%	8.00%
Convertible Notes Payable Two [Member]
Interest rate			8.00%	8.00%

Derivative Liabilities (Details

Derivative Liabilities (Details Narrative) - USD ($)	1 Months Ended		3 Months Ended			6 Months Ended
	May 17, 2017	Apr. 21, 2017	Jun. 30, 2017	Jun. 30, 2017	Jun. 30, 2016	Jun. 30, 2017	Jun. 30, 2016
Debt discount	$ 246,750	$ 90,000	$ 39,484			$ 39,484
Interest expense			509,764		$ 918	577,753	$ 1,057
April 2017 Note [Member]
Fair value of the embedded derivative			66,040	$ 66,040		$ 66,040
Risk free interest rate				1.50%		1.50%
Dividend yield				0.00%		0.00%
Volatility				316.00%		301.00%
Expected life				2 years 9 months 29 days		3 years
Debt discount						$ 90,000
Interest expense						9,106
Change in the fair value of the derivative			33,067	$ 33,067		33,067
April 2017 Note [Member] | Conversion Features [Member]
Fair value of the embedded derivative			99,106	99,106		99,106
May 2017 Note [Member]
Fair value of the embedded derivative			439,343	$ 439,343		$ 439,343
Risk free interest rate				1.243%		1.171%
Dividend yield				0.00%		0.00%
Volatility				419.00%		486.00%
Expected life				10 months 15 days		1 year
Debt discount						$ 246,750
Interest expense				$ 4,291		350,410
Change in the fair value of the derivative			162,108	162,108		162,108
May 2017 Note [Member] | Conversion Features [Member]
Fair value of the embedded derivative			$ 597,160	$ 597,160		$ 597,160

Deferred Revenue (Details Narra

Deferred Revenue (Details Narrative) - USD ($)	6 Months Ended
	Jun. 30, 2017	Jun. 30, 2016	Dec. 31, 2016	Oct. 30, 2012
License revenue	$ 0	$ 48,334
Deferred revenue	0		$ 0
Royalty revenue	$ 0	$ 20,282
Multistack, LLC [Member]
Percentage of accounts receivable	0.00%	68.00%
MG Energy LLC [Member]
Exchange for cancellation of debt				$ 2,034,521

Litigation (Details Narrative)

Litigation (Details Narrative) - USD ($)	Jul. 08, 2015	Oct. 20, 2014	Apr. 24, 2014	Jun. 30, 2017	Sep. 30, 2015
Soex [Member]
Cancellation of share issued					37,500,000
Royality payments paid		$ 500,000	$ 500,000
Royalty received			$ 50,000
Payment due date	Oct. 20, 2014
Failure to make payment	$ 225,000
Percentage of equity default	25.00%
Zan [Member]
Cancellation of share issued					3,750,000
Failure to make payment	$ 225,000
Employment Agreement [Member] | Soex [Member]
Percentage of equity default				25.00%
Remaining balance to pay				$ 450,000
Interest rate per month				1.50%
Interest rate per year				18.00%