Document and Entity Information
Document and Entity Information - USD ($) | 12 Months Ended | ||
Dec. 31, 2016 | Apr. 17, 2017 | Jun. 30, 2016 | |
Document And Entity Information | |||
Entity Registrant Name | Wizard World, Inc. | ||
Entity Central Index Key | 1,162,896 | ||
Document Type | 10-K | ||
Document Period End Date | Dec. 31, 2016 | ||
Amendment Flag | false | ||
Current Fiscal Year End Date | --12-31 | ||
Entity Well-known Seasoned Issuer | No | ||
Entity Voluntary Filer | No | ||
Entity Current Reporting Status | Yes | ||
Entity Filer Category | Smaller Reporting Company | ||
Entity Public Float | $ 9,152,692 | ||
Entity Common Stock, Shares Outstanding | 68,535,036 | ||
Trading Symbol | WIZD | ||
Document Fiscal Period Focus | FY | ||
Document Fiscal Year Focus | 2,016 |
Consolidated Balance Sheets
Consolidated Balance Sheets - USD ($) | Dec. 31, 2016 | Dec. 31, 2015 |
Current Assets | ||
Cash and cash equivalents | $ 4,401,217 | $ 4,723,699 |
Accounts receivable, net | 187,819 | 407,142 |
Inventory | 39,552 | |
Prepaid convention expenses | 704,711 | 990,401 |
Prepaid insurance | 96,076 | 37,654 |
Prepaid rent - related party | 181,796 | |
Prepaid taxes | 13,984 | 293,984 |
Other prepaid expenses | 13,666 | 7,210 |
Total Current Assets | 5,599,279 | 6,499,642 |
Property and equipment, net | 215,948 | 250,786 |
Security deposit | 19,912 | 21,066 |
Total Assets | 5,835,129 | 6,771,494 |
Current Liabilities | ||
Accounts payable and accrued expenses | 937,773 | 1,577,439 |
Unearned revenue | 1,574,938 | 3,731,498 |
Due to CONtv joint venture | 224,241 | 111,741 |
Total Current Liabilities | 2,736,952 | 5,420,678 |
Non-current Liabilities: | ||
Convertible promissory note – related party, net | 1,456 | |
Derivative liabilities – related party | 6,498,737 | |
Total Non-current Liabilities | 6,500,193 | |
Total Liabilities | 9,237,145 | 5,420,678 |
Commitments and contingencies | ||
Stockholders' Equity (Deficit) | ||
Preferred stock par value $0.0001: 20,000,000 shares authorized; 50,000 shares designated Series A convertible preferred stock par value $0.0001: 50,000 shares designated; 39,101 shares issued and converted | ||
Common stock par value $0.0001: 80,000,000 shares authorized; 68,535,036 and 51,368,386 shares issued and outstanding, respectively | 6,855 | 5,138 |
Additional paid-in capital | 21,132,386 | 17,341,268 |
Accumulated deficit | (24,529,440) | (16,013,296) |
Non-controlling interest | (11,817) | 17,706 |
Total Stockholders' Equity (Deficit) | (3,402,016) | 1,350,816 |
Total Liabilities and Stockholders' Equity (Deficit) | 5,835,129 | 6,771,494 |
Series A Convertible Preferred Stock [Member] | ||
Stockholders' Equity (Deficit) | ||
Preferred stock par value $0.0001: 20,000,000 shares authorized; 50,000 shares designated Series A convertible preferred stock par value $0.0001: 50,000 shares designated; 39,101 shares issued and converted |
Consolidated Balance Sheets (Pa
Consolidated Balance Sheets (Parenthetical) - $ / shares | Dec. 31, 2016 | Dec. 31, 2015 |
Preferred stock, par value | $ 0.0001 | $ 0.0001 |
Preferred stock, shares authorized | 20,000,000 | 20,000,000 |
Preferred stock, shares issued | ||
Preferred stock, shares converted | ||
Common stock, par value | $ 0.0001 | $ 0.0001 |
Common stock, shares authorized | 80,000,000 | 80,000,000 |
Common stock, shares issued | 68,535,036 | 51,368,386 |
Common stock, shares outstanding | 68,535,036 | 51,368,386 |
Series A Convertible Preferred Stock [Member] | ||
Preferred stock, par value | $ 0.0001 | $ 0.0001 |
Preferred stock, shares issued | 39,101 | 39,101 |
Preferred stock, shares converted | 39,101 | 39,101 |
Preferred stock, shares designated | 50,000 | 50,000 |
Consolidated Statements of Oper
Consolidated Statements of Operations - USD ($) | 12 Months Ended | |
Dec. 31, 2016 | Dec. 31, 2015 | |
Revenues | ||
Convention | $ 21,994,433 | $ 22,905,636 |
ConBox | 707,101 | 1,120,535 |
Total revenues | 22,701,534 | 24,026,171 |
Cost of revenues | ||
Cost of revenues | 16,002,088 | 18,760,031 |
Write-off of obsolete inventory | 164,903 | |
Total cost of revenues | 16,166,991 | 18,760,031 |
Gross margin | 6,534,543 | 5,266,140 |
Operating expenses | ||
Compensation | 4,468,149 | 5,396,798 |
Consulting fees | 687,054 | 625,111 |
General and administrative | 2,561,586 | 2,126,059 |
Total operating expenses | 7,716,789 | 8,147,968 |
Loss from operations | (1,182,246) | (2,881,828) |
Other expenses | ||
Interest expense | (26,676) | (2,909) |
Loss on disposal of equipment | (36,876) | |
Change in fair value of derivative liabilities | (1,829,709) | |
Derivative expense | (5,110,879) | |
Loss on investment | (24,997) | |
Loss on CONtv joint venture | (262,500) | (1,324,727) |
Total other expenses | (7,266,640) | (1,352,633) |
Loss before income tax provision | (8,448,886) | (4,234,461) |
Income tax provision | ||
Net loss | (8,448,886) | (4,234,461) |
Net income attributable to non-controlling interests | 67,258 | 17,706 |
Net loss attributable to common stockholders | $ (8,516,144) | $ (4,252,167) |
Loss per share - basic and diluted | $ (0.16) | $ (0.08) |
Weighted average common shares outstanding - basic and diluted | 52,775,488 | 51,363,920 |
Consolidated Statements of Stoc
Consolidated Statements of Stockholders' Equity (Deficit) - USD ($) | Preferred Stock Par Value $0.0001 [Member] | Common Stock Par Value $0.0001 [Member] | Additional Paid-In Capital [Member] | Accumulated Deficit [Member] | Non-controlling Interest [Member] | Total |
Balance at Dec. 31, 2014 | $ 5,137 | $ 16,021,400 | $ (11,761,129) | $ 4,265,408 | ||
Balance, shares at Dec. 31, 2014 | 51,358,386 | |||||
Share-based compensation | 1,315,869 | 1,315,869 | ||||
Share-based compensation, shares | ||||||
Shares issued upon exercise of options | $ 1 | 3,999 | $ 4,000 | |||
Shares issued upon exercise of options, shares | 10,000 | 10,000 | ||||
Shares issued as debt discount | ||||||
Net (loss) income | (4,252,167) | 17,706 | (4,234,461) | |||
Balance at Dec. 31, 2015 | $ 5,138 | 17,341,268 | (16,013,296) | 17,706 | 1,350,816 | |
Balance, shares at Dec. 31, 2015 | 51,368,386 | |||||
Share-based compensation | 777,536 | $ 777,536 | ||||
Share-based compensation, shares | ||||||
Shares issued upon exercise of options, shares | ||||||
Shares issued as debt discount | $ 50 | 84,950 | $ 85,000 | |||
Shares issued as debt discount, shares | 500,000 | |||||
Exercise of warrants | $ 1,667 | 1,667 | ||||
Exercise of warrants, shares | 16,666,650 | |||||
Extinguishment of derivative liability from exercise of warrants | 2,831,851 | 2,831,851 | ||||
Acquisition of controlling interest of ConBox | 96,781 | (96,781) | ||||
Net (loss) income | (8,516,144) | 67,258 | (8,448,886) | |||
Balance at Dec. 31, 2016 | $ 6,855 | $ 21,132,386 | $ (24,529,440) | $ (11,817) | $ (3,402,016) | |
Balance, shares at Dec. 31, 2016 | 68,535,036 |
Consolidated Statements of Cash
Consolidated Statements of Cash Flows - USD ($) | 12 Months Ended | |
Dec. 31, 2016 | Dec. 31, 2015 | |
Cash Flows From Operating Activities: | ||
Net loss | $ (8,448,886) | $ (4,234,461) |
Adjustments to reconcile net loss to net cash (used in) provided by operating activities: | ||
Depreciation | 159,101 | 119,213 |
Write-off of obsolete inventory | 164,903 | |
Loss on disposal of equipment | 36,876 | |
Change in fair value of derivative liabilities | 1,829,709 | |
Derivative expense | 5,110,879 | |
Accretion of debt discount | 1,456 | |
Loss on CONtv joint venture | 262,500 | 1,324,727 |
Loss on investment | 24,997 | |
Share-based compensation | 777,536 | 1,315,869 |
Changes in operating assets and liabilities: | ||
Accounts receivable | 219,323 | (407,142) |
Inventory | (125,351) | (39,552) |
Prepaid convention expenses | 285,689 | 588,641 |
Prepaid rent- related party | (181,796) | |
Prepaid insurance | (58,422) | 63,801 |
Prepaid taxes | 280,000 | |
Other prepaid expenses | (6,455) | (4,331) |
Security deposit | 1,154 | (1,000) |
Accounts payable and accrued expenses | (639,666) | (16,902) |
Unearned revenue | (2,156,560) | 1,709,263 |
Net Cash (Used in) Provided by Operating Activities | (2,488,009) | 443,123 |
Cash Flows from Investing Activities: | ||
Purchase of property and equipment | (169,802) | (105,257) |
Proceeds received on disposal of equipment | 4,850 | |
Investment in CONtv joint venture - net | (150,000) | (1,408,891) |
Net Cash Used In Investing Activities | (311,140) | (1,514,148) |
Cash Flows from Financing Activities: | ||
Proceeds from issuance of convertible promissory note and warrants | 2,500,000 | |
Payment of debt issuance costs | (25,000) | |
Proceeds from the exercise of warrants | 1,667 | |
Proceeds from the exercise of options | 4,000 | |
Net Cash Provided By Financing Activities | 2,476,667 | 4,000 |
Net change in cash and cash equivalents | (322,482) | (1,067,025) |
Cash and cash equivalents at beginning of reporting period | 4,723,699 | 5,790,724 |
Cash and cash equivalents at end of reporting period | 4,401,217 | 4,723,699 |
Supplemental disclosures of cash flow information: | ||
Interest paid | 200 | 2,909 |
Income tax paid | ||
Supplemental disclosure of non-cash investing and financing activities: | ||
Acquisition of controlling interest of ConBox | 96,781 | |
Derivative liability recorded on convertible debt and warrant issuances | 7,500,879 | |
Common stock issued for debt discount recorded on convertible note | 85,000 | |
Extinguishment of derivative liability from exercise of warrants | $ 2,831,851 |
Organization and Operations
Organization and Operations | 12 Months Ended |
Dec. 31, 2016 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Organization and Operations | Note 1 – Organization and Operations Wizard World, Inc. Wizard World, Inc., formerly GoEnergy, Inc. (“Wizard World” or the “Company”) was incorporated on May 2, 2001, under the laws of the State of Delaware. The Company, through its operating subsidiary, is a producer of pop culture and live multimedia conventions across North America. Kick the Can Corp. Kick The Can Corp. was incorporated on September 20, 2010, under the laws of the State of Nevada. Kicking the Can, L.L.C. Kicking The Can, L.L.C. was formed on April 17, 2009, under the laws of the State of Delaware. Acquisition of Kick the Can Corp. / Wizard Conventions, Inc. Recognized as a Reverse Acquisition On December 7, 2010, the Company entered into and consummated a share exchange agreement (“Share Exchange Agreement”) with successor, Kick the Can Corp. (“KTC Corp.”) and its predecessors Wizard Conventions, Inc. and Kicking The Can, L.L.C. (collectively, “Conventions”). Pursuant to the Exchange Agreement, the Company issued 32,927,596 shares of its common stock to the KTC Corp. shareholders in exchange for 100% of the issued and outstanding shares of KTC Corp. The shares issued represented approximately 94.9% of the issued and outstanding common stock immediately after the consummation of the Share Exchange Agreement. As a result of the controlling financial interest of the former stockholder of Conventions, for financial statement reporting purposes, the merger between the Company and Conventions has been treated as a reverse acquisition with KTC Corp. deemed the accounting acquirer and the Company deemed the accounting acquiree under the acquisition method of accounting in accordance with section 805-10-55 of the Financial Accounting Standards Board (‘FASB”) Accounting Standards Codification. The reverse merger is deemed a capital transaction and the net assets of KTC Corp. (the accounting acquirer) are carried forward to the Company (the legal acquirer and the reporting entity) at their carrying value before the combination. The acquisition process utilizes the capital structure of the Company and the assets and liabilities of KTC Corp. which are recorded at historical cost. The equity of the Company is the historical equity of KTC Corp. retroactively restated to reflect the number of shares issued by the Company in the transaction. Because of the predecessor/successor relationship between the Company and KTC Corp., Conventions ultimately became the accounting acquirer. Wizard World Digital, Inc. On March 18, 2011, the Company formed a wholly owned subsidiary called Wizard World Digital, Inc., a Nevada corporation (“Digital”). Digital never commenced operations or has employees, and Digital is currently dormant, pending execution of a digital strategy. Wiz Wizard, LLC On December 29, 2014, the Company and a member of the Board of Directors (the “Board”) of the Company formed Wiz Wizard, LLC (“Wiz Wizard”) under the law of the State of Delaware. The Company and the member of the Board each owned 50% of the membership interest and agreed to allocate the profits and losses accordingly upon repayment of the initial capital contributions on a pro rata basis. The Company consolidates its 50% equity interest and reports the remaining 50% equity interest owned by a member of the Board as the non-controlling interest in Wiz Wizard as the management of the Company believes that the Company has the control of Wiz Wizard. In addition, the Company and Wiz Wizard, launched ComicConBox (“ConBox”) in April 2015. ConBox is a subscription-based premium monthly box service featuring collectibles, exclusives, toys, tech and gaming, licensed artwork, superior comics and apparel, Comic Convention tickets, special VIP discounts and more, which will be shipped on or around the end of every month. The Company plans to continue to partner with major Comic Convention related brands and celebrities to deliver a high quality and variation of products directly to the front doors of its subscribers. On February 4, 2016, the member of the Board assigned his fifty percent (50%) membership interest to the Company. Consequently, Wiz Wizard is a wholly-owned subsidiary of the Company. ButtaFyngas LLC On April 10, 2015, the Company and an unrelated third party formed ButtaFyngas, LLC (“ButtaFyngas”) under the law of the State of Delaware. The Company and the unrelated party each own 50% of the membership interest and shall allocate the profits and losses accordingly upon repayment of the initial capital contributions on a pro rata basis. The Company consolidates its 50% equity interest and reports the remaining 50% equity interest owned by the third party as the non-controlling interest in ButtaFyngas. |
Going Concern Analysis
Going Concern Analysis | 12 Months Ended |
Dec. 31, 2016 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Going Concern Analysis | Note 2 – Going Concern Analysis Going Concern Analysis The Company had a net loss of $8,448,886 (of which $6,940,588 was derived from non-cash charges related to the accounting treatment for derivative liabilities) and $4,234,461 for the years ended December 31, 2016 and 2015. As a result, these conditions had raised doubt regarding our ability to continue as a going concern beyond 2017. However, subsequent to the Bristol financing transaction (as noted below) and as of December 31, 2016, we had cash and working capital of $4,401,217 and $2,862,317, respectively. As noted above, the net loss during the year ended December 31, 2016 included non-cash derivative related expenses of $6,940,588. Effective December 1, 2016, upon the Board of Directors of the Company receiving an independent third party fairness opinion, the Company entered into the Purchase Agreement with Bristol Investment Fund, Ltd., an entity controlled by the Chairman of the Company’s Board of Directors, pursuant to which the Company sold to the Purchaser, for a cash purchase price of $2,500,000, securities comprising: (i) the Debenture, (ii) Series A Warrants, and (iii) Series B Warrants. Pursuant to the Purchase Agreement, the Company paid $25,000 to the Purchaser and issue to the Purchaser 500,000 shares of Common Stock with a grant date fair value of $85,000 to cover the Purchaser’s legal fees. If necessary, management also believes that it is probable that external sources of debt and/or equity financing could be obtained based on management’s history of being able to raise capital coupled with current favorable market conditions. As a result of both management’s plans, the Company believes the initial conditions which raised substantial doubt regarding the ability to continue as a going concern have been alleviated. Therefore, the accompanying consolidated financial statements have been prepared assuming that the Company will continue as a going concern. The consolidated financial statements do not include any adjustments to reflect the possible future effects on the recoverability and classification of assets or the amounts and classification of liabilities that may result from the matters discussed herein. While the Company believes in the viability of management’s strategy to generate sufficient revenue, control costs and the ability to raise additional funds if necessary, there can be no assurances to that effect. The Company’s ability to continue as a going concern is dependent upon the ability to further implement the business plan, generate sufficient revenues and to control operating expenses. |
Significant and Critical Accoun
Significant and Critical Accounting Policies and Practices | 12 Months Ended |
Dec. 31, 2016 | |
Accounting Policies [Abstract] | |
Significant and Critical Accounting Policies and Practices | Note 3 – Significant and Critical Accounting Policies and Practices The management of the Company is responsible for the selection and use of appropriate accounting policies and their application. Critical accounting policies and practices are those that are both most important to the portrayal of the Company’s financial condition and results and require management’s most difficult, subjective, or complex judgments, often as a result of the need to make estimates about the effects of matters that are inherently uncertain. The Company’s significant and critical accounting policies and practices are disclosed below as required by generally accepted accounting principles. Basis of Presentation The Company’s consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“US GAAP”). Use of Estimates and Assumptions and Critical Accounting Estimates and Assumptions The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the dates of the financial statements and the reported amounts of revenues and expenses during the reporting periods. Actual results could differ from those estimates. Principles of Consolidation The consolidated financial statements include all accounts of the entities as of the reporting period ending date(s) and for the reporting period(s) as follows: Name of consolidated subsidiary or entity State or other jurisdiction of incorporation or organization Date of incorporation or formation (date of acquisition, if applicable) Attributable interest KTC Corp. The State of Nevada, U.S.A. September 20, 2010 100 % Kicking the Can L.L.C. The State of Delaware, U.S.A. April 17, 2009 100 % Wizard World Digital, Inc. The State of Nevada, U.S.A. March 18, 2011 100 % Wiz Wizard, LLC The State of Delaware, U.S.A. December 29, 2014 100 % ButtaFyngas, LLC The State of Delaware, U.S.A. April 10, 2015 50 % All inter-company balances and transactions have been eliminated. Non–controlling interest represents the minority equity investment in the Company’s subsidiaries, plus the minority investors’ share of the net operating results and other components of equity relating to the non–controlling interest. As of December 31, 2016, the aggregate non-controlling interest in ButtaFyngas was ($11,817). As of December 31, 2015, the aggregate non-controlling interest in Wiz Wizard and ButtaFyngas was ($10,786). The non-controlling interest is separately disclosed on the Consolidated Balance Sheet. Cash and Cash Equivalents The Company considers investments with original maturities of three months or less to be cash equivalents. The Company minimizes its credit risk associated with cash by periodically evaluating the credit quality of its primary financial institution. The balance at times may exceed federally insured limits. Fair Value of Financial Instruments For purpose of this disclosure, the fair value of a financial instrument is the amount at which the instrument could be exchanged in a current transaction between willing parties, other than in a forced sale or liquidation. The carrying amount of the Company’s short-term financial instruments approximates fair value due to the relatively short period to maturity for these instruments. Accounts Receivable and Allowance for Doubtful Accounts Accounts receivable are stated at the amount management expects to collect from outstanding balances. The Company generally does not require collateral to support customer receivables. The Company provides an allowance for doubtful accounts based upon a review of the outstanding accounts receivable, historical collection information and existing economic conditions. The Company determines if receivables are past due based on days outstanding, and amounts are written off when determined to be uncollectible by management. The maximum accounting loss from the credit risk associated with accounts receivable is the amount of the receivable recorded, which is the face amount of the receivable net of the allowance for doubtful accounts. As of December 31, 2016 and 2015, the allowance for doubtful accounts was $0 and $426,532, respectively. Inventories Inventories are stated at average cost using the first-in, first-out (FIFO) valuation method. Inventory was comprised of the following: December 31, 2016 December 31, 2015 Finished goods $ - $ 39,552 Property and Equipment Property and equipment are recorded at cost. Expenditures for major additions and betterments are capitalized. Maintenance and repairs are charged to operations as incurred. Depreciation is computed by the straight-line method (after taking into account their respective estimated residual values) over the estimated useful lives of the respective assets as follows: Estimated Useful Life (Years) Computer equipment 3 Equipment 2-5 Furniture and fixture 7 Leasehold improvements * (*) Amortized on a straight-line basis over the term of the lease or the estimated useful lives, whichever period is shorter. Upon sale or retirement of property and equipment, the related cost and accumulated depreciation are removed from the accounts and any gain or loss is reflected in the consolidated statements of operations. Investments - Cost Method, Equity Method and Joint Venture In accordance with sub-topic 323-10 of the FASB ASC (“Sub-topic 323-10”), the Company accounts for investments in common stock of an investee for which the Company has significant influence in the operating or financial policies even though the Company holds 50% or less of the common stock or in-substance common stock. Method of Accounting Investments held in stock of entities other than subsidiaries, namely corporate joint ventures and other non-controlled entities usually are accounted for by one of three methods: (i) the fair value method (addressed in Topic 320), (ii) the equity method (addressed in Topic 323), or (iii) the cost method (addressed in Subtopic 325-20). Pursuant to Paragraph 323-10-05-5, the equity method tends to be most appropriate if an investment enables the investor to influence the operating or financial policies of the investee. Investment in CONtv On August 27, 2014, the Company entered into a joint venture and executed an Operating Agreement for CON TV LLC (“CONtv”) with Cinedigm Entertainment Corp. (“Cinedigm”), ROAR, LLC (a related party partially owned by a member of the Board) (“ROAR”) and Bristol Capital, LLC (a related party controlled by a member of the Board) (“Bristol Capital”). The Company owned a 47.50% interest in the newly formed entity, CONtv. The Company was accounting for the interest in the joint venture utilizing the equity method of accounting. On November 16, 2015, pursuant to that certain Amended and Restated Operating Agreement for CONtv by and among the aforementioned parties (the “A&R Operating Agreement”), the Company’s ownership interest in CONtv was reduced to 10%. Pursuant to the A&R Operating Agreement, the Company is only obligated to fund on-going costs in the amount of $25,000 in cash on an on-going monthly basis for a period of 12 months following the effective date. For the years ended December 31, 2016 and 2015, the Company recognized $262,500 and $1,324,727 in losses from this venture, respectively. As of December 31, 2016 and 2015, the investment in CONtv was $0. Fair Value of Financial Instruments The Company follows ASC 820-10 of the FASB Accounting Standards Codification to measure the fair value of its financial instruments and disclosures about fair value of its financial instruments. ASC 820-10 establishes a framework for measuring fair value in accounting principles generally accepted in the United States of America (U.S. GAAP), and expands disclosures about fair value measurements. To increase consistency and comparability in fair value measurements and related disclosures, ASC 820-10 establishes a fair value hierarchy which prioritizes the inputs to valuation techniques used to measure fair value into three (3) broad levels. The three (3) levels of fair value hierarchy defined by ASC 820-10 are described below: Level 1 Quoted market prices available in active markets for identical assets or liabilities as of the reporting date. Level 2 Pricing inputs other than quoted prices in active markets included in Level 1, which are either directly or indirectly observable as of the reporting date. Level 3 Pricing inputs that are generally unobservable inputs and not corroborated by market data. Financial assets are considered Level 3 when their fair values are determined using pricing models, discounted cash flow methodologies or similar techniques and at least one significant model assumption or input is unobservable. The fair value hierarchy gives the highest priority to quoted prices (unadjusted) in active markets for identical assets or liabilities and the lowest priority to unobservable inputs. If the inputs used to measure the financial assets and liabilities fall within more than one level described above, the categorization is based on the lowest level input that is significant to the fair value measurement of the instrument. The carrying amounts of the Company’s financial assets and liabilities, such as cash, accounts receivable, inventory, prepaid expenses and other current assets, accounts payable and accrued expenses approximate their fair values because of the short maturity of these instruments. In connection with the securities purchase agreement and debt transactions during the year ended December 31, 2016, the Company issued warrants, to purchase common stock with an exercise price of $0.15 and a five-year term. The Company identified certain put features embedded in the warrants that potentially could result in a net cash settlement in the event of a fundamental transaction, requiring the Company to classify the warrants as a derivative liability. In connection with the issuance of a convertible promissory note as discussed below in Note 6, the Company evaluated the note agreement to determine if the agreement contained any embedded components that would qualify the agreement as a derivative. The Company identified certain put features embedded in the convertible note agreement that potentially could result in a net cash settlement in the event of a fundamental transaction, requiring the Company to classify the conversion feature as a derivative liability. The Company determined that it is not practical to estimate the fair value of the convertible promissory note payable because of its unique nature and the costs that would be incurred to obtain an independent valuation. The Company does not have comparable outstanding debt on which to base an estimated current borrowing rate or other discount rate for purposes of estimating the fair value of the convertible note payable and the Company has not been able to develop a valuation model that can be applied consistently in a cost-efficient manner. These factors all contribute to the impracticability of estimating the fair value of the notes payable. At December 31, 2016 and 2015, the carrying value of the convertible promissory note payable net of debt discount was $1,456 and $0. At December 31, 2016, the Company recorded accrued interest of $24,243 and $0, which is included on the Consolidated Balance Sheets in the accounts payable and accrued expenses line item. Transactions involving related parties typically cannot be presumed to be carried out on an arm’s-length basis, as the requisite conditions of competitive, free-market dealings may not exist. However, in the case of the convertible promissory note discussed in Note 6, the Company obtained a fairness opinion from an independent third party which supports that the transaction was carried out at an arm’s length basis. The Company’s Level 3 financial liabilities consist of the derivative conversion features issued in 2016. The Company valued the conversion features using a Monte Carlo model. These models incorporate transaction details such as the Company’s stock price, contractual terms, maturity, risk free rates, and volatility as of the date of issuance and each balance sheet date. The Company utilized the following management assumptions in valuing the derivative conversion feature during the year ended December 31, 2016: Exercise price $ 0.12 - 0.15 Risk free interest rate 1.14% – 1.93 % Dividend yield 0.00 % Expected volatility 94% - 115 % Remaining term 2 to 5 years Fair Value of Financial Assets and Liabilities Measured on a Recurring Basis The Company uses Level 3 of the fair value hierarchy to measure the fair value of the derivative liabilities and revalues its derivative liability at every reporting period and recognizes gains or losses in the statements of operations that are attributable to the change in the fair value of the derivative liability. Financial assets and liabilities measured at fair value on a recurring basis are summarized below and disclosed on the balance sheets as follows: Fair Value Measurement Using Carrying Value Level 1 Level 2 Level 3 Total Embedded conversion feature $ 3,298,000 $ - $ - $ 3,298,000 $ 3,298,000 Warrant liability 3,200,137 - - 3,200,137 3,200,137 December 31, 2016 $ 6,498,737 $ - $ - $ 6,498,737 $ 6,498,737 The unobservable level 3 inputs used by the Company was the expected volatility assumption used in the Monte Carlo pricing model. Expected volatility is based on the historical stock price of the Company’s common stock. The following table provides a summary of the changes in fair value, including net transfers in and/or out, of all financial assets measured at fair value on a recurring basis using significant unobservable inputs during the year ended December 31, 2016. Warrants Convertible Note Total Balance – December 31, 2015 $ - $ - $ - Issuance of derivative liabilities 5,206,444 2,294,435 7,500,879 Extinguishment of derivative liability from exercise of warrants (2,831,851 ) - (2,831,851 ) Change in fair value of derivative liability 825,544 1,004,165 1,829,709 Balance – December 31, 2016 $ 3,200,137 $ 3,298,000 $ 6,498,737 Changes in the unobservable input values could potentially cause material changes in the fair value of the Company’s Level 3 financial instruments. The significant unobservable inputs used in the fair value measurements is the expected volatility assumption. A significant increase (decrease) in the expected volatility assumption could potentially result in a higher (lower) fair value measurement. Derivative Instruments The Company evaluates its convertible debt, warrants or other contracts to determine if those contracts or embedded components of those contracts qualify as derivatives to be separately accounted for in accordance with ASC 815-15. The result of this accounting treatment is that the fair value of the embedded derivative is marked-to-market each balance sheet date and recorded as a liability. In the event that the fair value is recorded as a liability, the change in fair value is recorded in the statements of operations as other income or expense. Upon conversion or exercise of a derivative instrument, the instrument is marked to fair value at the conversion date and then that fair value is reclassified to equity. In circumstances where the embedded conversion option in a convertible instrument is required to be bifurcated and there are also other embedded derivative instruments in the convertible instrument that are required to be bifurcated, the bifurcated derivative instruments are accounted for as a single, compound derivative instrument. The classification of derivative instruments, including whether such instruments should be recorded as liabilities or as equity, is re-assessed at the end of each reporting period. Equity instruments that are initially classified as equity that become subject to reclassification are reclassified to liability at the fair value of the instrument on the reclassification date. Revenue Recognition and Cost of Revenues The Company follows Paragraph 605-10-S99-1 of the FASB Accounting Standards Codification for revenue recognition. The Company will recognize revenue when it is realized or realizable and earned. The Company considers revenue realized or realizable and earned when all of the following criteria are met: (i) persuasive evidence of an arrangement exists, (ii) the product has been shipped or the services have been rendered to the customer, (iii) the sales price is fixed or determinable, and (iv) collectability is reasonably assured. Convention revenue is generally earned upon completion of the convention. Unearned convention revenue is deposits received for conventions that have not yet taken place, which are fully or partially refundable depending upon the terms and conditions of the agreements. Unearned ConBox revenue is non-refundable up-front payments for products. These payments are initially deferred and subsequently recognized over the subscription period, typically three months, and upon shipment of the product. The Company recognizes cost of revenues in the period in which the revenues was earned. In the event the Company incurs cost of revenues for conventions that are yet to occur, the Company records such amounts as prepaid expenses and such prepaid expenses are expensed during the period the convention takes place. Shipping and Handling Costs The Company accounts for shipping and handling fees in accordance with paragraph 605-45-45-19 of the FASB Accounting Standards Codification. While amounts charged to customers for shipping products are included in revenues, the related costs are classified in cost of revenue as incurred. Shipping and handling costs were $178,931 and $176,986 for the years ended December 31, 2016 and 2015, respectively. Equity–based compensation The Company recognizes compensation expense for all equity–based payments in accordance with ASC 718 “ Compensation – Stock Compensation Restricted stock awards are granted at the discretion of the Company. These awards are restricted as to the transfer of ownership and generally vest over the requisite service periods, typically over a four-year period (vesting on a straight–line basis). The fair value of a stock award is equal to the fair market value of a share of Company stock on the grant date. The fair value of option award is estimated on the date of grant using the Black–Scholes option valuation model. The Black–Scholes option valuation model requires the development of assumptions that are input into the model. These assumptions are the expected stock volatility, the risk–free interest rate, the expected life of the option, the dividend yield on the underlying stock and the expected forfeiture rate. Expected volatility is calculated based on the historical volatility of the Company’s Common stock over the expected option life and other appropriate factors. The expected option term is computed using the “simplified” method as permitted under the provisions of ASC 718-10-S99. The Company uses the simplified method to calculate expected term of share options and similar instruments as the Company does not have sufficient historical exercise data to provide a reasonable basis upon which to estimate expected term. Risk–free interest rates are calculated based on continuously compounded risk–free rates for the appropriate term. The dividend yield is assumed to be zero as the Company has never paid or declared any cash dividends on the Common stock of the Company and does not intend to pay dividends on the Common stock in the foreseeable future. The expected forfeiture rate is estimated based on historical experience. Determining the appropriate fair value model and calculating the fair value of equity–based payment awards requires the input of the subjective assumptions described above. The assumptions used in calculating the fair value of equity–based payment awards represent management’s best estimates, which involve inherent uncertainties and the application of management’s judgment. As a result, if factors change and the Company uses different assumptions, the equity–based compensation could be materially different in the future. In addition, the Company is required to estimate the expected forfeiture rate and recognize expense only for those shares expected to vest. If the actual forfeiture rate is materially different from the Company’s estimate, the equity–based compensation could be significantly different from what the Company has recorded in the current period. The Company accounts for share–based payments granted to non–employees in accordance with ASC 505-40, “ Equity Based Payments to Non–Employees Income Taxes Income taxes are provided in accordance with ASC No. 740, “ Accounting for Income Taxes Deferred tax assets are reduced by a valuation allowance when, in the opinion of management, it is more likely than not that some portion or all of the deferred tax assets will not be realized. Deferred tax assets and liabilities are adjusted for the effects of changes in tax laws and rates on the date of enactment. The Company is no longer subject to tax examinations by tax authorities for years prior to 2013. During the year ended December 31, 2016, the Company partially utilized NOL carry-forwards to offset taxable income. Earnings per Share Earnings per share (“EPS”) is the amount of earnings attributable to each share of common stock. For convenience, the term is used to refer to either earnings or loss per share. EPS is computed pursuant to Section 260-10-45 of the FASB Accounting Standards Codification. Pursuant to ASC Paragraphs 260-10-45-10 through 260-10-45-16, basic EPS shall be computed by dividing income available to common stockholders (the numerator) by the weighted-average number of common shares outstanding (the denominator) during the period. Income available to common stockholders shall be computed by deducting both the dividends declared in the period on preferred stock (whether or not paid) and the dividends accumulated for the period on cumulative preferred stock (whether or not earned) from income from continuing operations (if that amount appears in the income statement) and also from net income. The computation of diluted EPS is similar to the computation of basic EPS except that the denominator is increased to include the number of additional common shares that would have been outstanding if the dilutive potential common shares had been issued during the period to reflect the potential dilution that could occur from common shares issuable through contingent shares issuance arrangement, stock options or warrants. The following table shows the outstanding dilutive common shares excluded from the diluted net income (loss) per share calculation as they were anti-dilutive: Contingent shares issuance arrangement, stock options or warrants For the Year Ended December 31, 2016 For the Year Ended December 31, 2015 Convertible note 16,666,667 - Common stock options 5,319,000 9,933,500 Common stock warrants 16,666,667 - Total contingent shares issuance arrangement, stock options or warrants 38,652,334 9,933,500 Reclassification Certain prior period amounts have been reclassified to conform to current period presentation. Recently Issued Accounting Pronouncements In August 2014, the FASB issued ASU 2014-15, “ Presentation of Financial Statements-Going Concern (Subtopic 205-40): Disclosure of Uncertainties about an Entity’s Ability to Continue as a Going Concern In July 2015, the FASB issued the ASU No. 2015-11 “ Inventory (Topic 330) Simplifying the Measurement of Inventory” . In February 2016, the FASB issued ASU 2016-02, “Leases (Topic 842).” In March 2016, the FASB issued ASU No. 2016-06, “ Derivatives and Hedging” (topic 815) In April 2016, the FASB issued ASU No. 2016-10, “ Revenue from Contracts with Customers: Identifying Performance Obligations and Licensing (Topic 606) Revenue from Contracts with Customers: Principal versus Agent Considerations (Reporting Revenue Gross verses Net) (Topic 606) In April 2016, the FASB issued ASU No. 2016-09, “ Compensation – Stock Compensation (Topic 718) In May 2016, the FASB issued ASU No. 2016-12, “ Revenue from Contracts with Customers (Topic 606): Narrow-Scope Improvements and Practical Expedients” In August 2016, the FASB issued ASU 2016-15, “Statement of Cash Flows (Topic 230): Classification of Certain Cash Receipts and Cash Payments” In October 2016, the FASB issued ASU 2016-16, “Income Taxes (Topic 740): Intra-Entity Transfers of Assets Other than Inventory”, In November 2016, the FASB issued ASU 2016-18, “Statement of Cash Flows (Topic 230)” Management does not believe that any recently issued, but not yet effective accounting pronouncements, when adopted, will have a material effect on the accompanying consolidated financial statements. |
Property and Equipment
Property and Equipment | 12 Months Ended |
Dec. 31, 2016 | |
Property, Plant and Equipment [Abstract] | |
Property and Equipment | Note 4 – Property and Equipment Property and equipment stated at cost, less accumulated depreciation and amortization, consisted of the following: December 31, 2016 December 31, 2015 Computer Equipment $ 33,858 $ 33,792 Equipment 390,656 343,359 Furniture and Fixtures 45,198 48,950 Leasehold Improvements 22,495 - 492,207 426,101 Less: Accumulated depreciation (276,259 ) (175,315 ) $ 215,948 $ 250,786 Depreciation expense was $159,102 and $119,213 for the years ended December 31, 2016 and 2015, respectively. |
Investment in CONtv Joint Ventu
Investment in CONtv Joint Venture | 12 Months Ended |
Dec. 31, 2016 | |
Investment In Contv Joint Venture | |
Investment in CONtv Joint Venture | Note 5 – Investment in CONtv Joint Venture On August 27, 2014, the Company entered into a joint venture and executed an Operating Agreement with Cinedigm, ROAR (a related party co-founded by one of the Company’s directors) and Bristol Capital (a related party founded by the Company’s Chairman of the Board). The Company owned a 47.50% interest in the newly formed entity, CONtv. The Company was accounting for the interest in the joint venture utilizing the equity method of accounting. On November 16, 2015, the Company entered that certain A&R Operating Agreement by and among, the Company, Cinedigm, ROAR and Bristol Capital, pursuant to which the Company’s interest in CONtv was reduced to a non-dilutable 10% membership interest. Such agreement was deemed effective on the execution date; however, Cinedigm agreed to the Company recognizing only 10% of the losses from the period July 1, 2015 through December 31, 2015. Pursuant to the A&R Operating Agreement, the Company is only obligated to fund on-going costs in the amount of $25,000 in cash on an on-going monthly basis for a period of 12 months following the effective date. For the years ended December 31, 2016 and 2015, the Company recognized $262,500 and $1,324,727 in losses from this venture, respectively. As of December 31, 2016 and 2015, the investment in CONtv was as follows: Investment in CONtv – December 31, 2014 $ 117,507 Investment into CONtv 1,207,220 Loss on CONtv for the year ended December 31, 2015 (1,324,727 ) Investment in CONtv – December 31, 2015 $ - Investment into CONtv 262,500 Loss on CONtv for the year ended December 31, 2016 (262,500 ) Investment in CONtv – December 31, 2016 $ - As of December 31, 2016 and 2015, the Company has a balance due to CONtv of $224,241 and $111,741, respectively. |
Related Party Transactions
Related Party Transactions | 12 Months Ended |
Dec. 31, 2016 | |
Related Party Transactions [Abstract] | |
Related Party Transactions | Note 6 – Related Party Transactions Wiz Wizard On December 29, 2014, the Company and a member of the Board formed Wiz Wizard (d/b/a ConBox) in the State of Delaware. The Company and the member of the Board each owned 50% of the membership interest and agreed to allocate the profits and losses accordingly upon repayment of the initial capital contributions on a pro rata basis. On February 4, 2016, the member of the Board assigned his fifty percent (50%) membership interest to the Company. Consulting Agreement On December 29, 2016, the Company entered into a Consulting Services Agreement (the “Consulting Agreement”) with Bristol Capital, LLC, a Delaware limited liability company (“Bristol”) managed by Paul L. Kessler, the Chairman of the Company. Pursuant to the Consulting Agreement, Mr. Kessler will serve as Executive Chairman of the Company. The initial term of the Agreement is from December 29, 2016 through March 28, 2017 (the “Initial Term”). The term of the Consulting Agreement will be automatically extended for additional terms of 90 day periods each (each a “Renewal Term” and together with the Initial Term, the “Term”), unless either the Company or Bristol gives prior written notice of non-renewal to the other party no later than thirty (30) days prior to the expiration of the then current Term. During the Term, the Company will pay Bristol a monthly fee (the “Monthly Fee”) of Eighteen Thousand Seven Hundred Fifty and No/100 Dollars ($18,750). In addition, the Company will grant to Bristol options to purchase up to an aggregate of 600,000 shares of the Company’s common stock. During the year ended December 31, 2016, the Company incurred total expenses of $80,132 for services provided by Bristol. At December 31, 2016, the Company accrued $75,000 of monthly fees due to Bristol. Operating Sublease On June 16, 2016, the Company entered into a Standard Multi-Tenant Sublease (“Sublease”) with Bristol Capital Advisors, LLC (“Bristol Capital Advisors”), an entity controlled by the Company’s Chairman of the Board. The term of the Sublease is for 5 years and 3 months beginning on July 1, 2016 with monthly payments of $8,118. Upon execution of the Sublease, the Company paid a security deposit of $9,137 and $199,238 for prepaid rent of which $181,796 remains at December 31, 2016. During the year ended December 31, 2016, the Company incurred total rent expense of $24,354 under the Sublease. See Note 7 for future minimum rent payments due. Outsourced Marketing During the year ended December 31, 2016, the Company utilized outsourced marketing support from a company affiliated with ROAR, which is partially owned by a member of the Board. The Company had expenses of $36,809 and $0 during the years ended December 31, 2016 and 2015. AS of December 31, 2016 and 2015, the outstanding liability due to ROAD was $0 and $7,500, respectively. Securities Purchase Agreement Effective December 1, 2016, the Company entered into the Purchase Agreement with Bristol Investment Fund, Ltd. (the “ Purchaser (i) Debenture The Debenture with an initial principal balance of $2,500,000, due December 30, 2018 (the “Maturity Date”), will accrue interest on the aggregate unconverted and then outstanding principal amount of the Debenture at the rate of 12% per annum. Interest is payable quarterly on (i) January 1, April 1, July 1 and October 1, beginning on January 1, 2017, (ii) on each date the Purchaser converts, in whole or in part, the Debenture into Common Stock (as to that principal amount then being converted), and (iii) on the day that is 20 days following the Company’s notice to redeem some or all of the of the outstanding principal of the Debenture (only as to that principal amount then being redeemed) and on the Maturity Date. The Debenture is convertible into shares of the Company’s Common Stock at any time at the option of the holder, at an initial conversion price of $0.15 per share, subject to adjustment. In the event of default occurs, the conversion price shall be the lesser of (i) the initial conversion price of $0.15 and (ii) 50% of the average of the 3 lowest trading prices during the 20 trading days immediately prior to the applicable conversion date. (ii) Series A Warrants The Series A Warrants to acquire up to 16,666,667 shares of Common Stock at the Series A Initial Exercise Price of $0.15 and expiring on December 1, 2021. The Warrants may be exercised immediately upon the issuance date, upon the option of the holder. (iii) Series B Warrants The Series B Warrants to acquire up to 16,666,650 shares of Common Stock at the Series B Initial Exercise Price of $0.15 and expiring on December 1, 2021. The Series B Warrants were exercised immediately upon the issuance date. The Company received gross proceeds of $1,667 upon exercise of the warrants. Derivative Analysis Because the conversion feature included in the convertible note payable and warrants have full reset adjustments tied to future issuances of equity securities by the Company, they are subject to derivative liability treatment under Section 815-40-15 of the FASB Accounting Standard Codification (“Section 815-40-15”). Generally accepted accounting principles require that: a. Derivative financial instruments be recorded at their fair value on the date of issuance and then adjusted to fair value at each subsequent balance sheet date with any change in fair value reported in the statement of operations; and b. The classification of derivative financial instruments be reassessed as of each balance sheet date and, if appropriate, be reclassified as a result of events during the reporting period then ended. Upon issuance of the note, a debt discount was recorded and any difference in comparison to the face value of the note, representing the fair value of the conversion feature and the warrants in excess of the debt discount, was immediately charged to derivative expense. The debt discount is amortized over the earlier of (i) the term of the debt or (ii) conversion of the debt, using the effective interest method which approximates the interest method. The amortization of debt discount is included as a component of interest expense in the consolidated statements of operations. There was unamortized debt discount of $2,498,544 as of December 31, 2016. The Company recorded an immediate charge to derivative expense of $5,110,879 for the fair value of the conversion feature and warrants that exceeded the debt discount. The fair value of the embedded conversion feature was estimated using a Monte Carlo pricing model. See Note 3 for the estimates and assumptions used. |
Commitments and Contingencies
Commitments and Contingencies | 12 Months Ended |
Dec. 31, 2016 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | Note 7 – Commitments and Contingencies Employment Agreements Appointment of Executive Vice President and Chief Operating Officer On November 8, 2016, the Company formally entered into an employment agreement (the “Malinoff Employment Agreement”) with Randall S. Malinoff in connection with his appointment as the Company’s Executive Vice President and Chief Operating Officer on July 14, 2016 (the “Effective Date”) to serve for a period of two years from the Effective Date. In connection with such appointment, Mr. Malinoff will receive an annual base salary of $225,000 and will be eligible for a performance-based bonus at the discretion of the Board. On November 8, 2016, pursuant to the terms of the Malinoff Employment Agreement, the Company granted six hundred thousand (600,000) options to purchase shares of the Company’s common stock, such options to vest, at the applicable exercise price, as follows: a. Seventy-five thousand (75,000) options shall be exercisable at a price of $0.50 per share and shall vest immediately; b. Seventy-five thousand (75,000) options shall be exercisable at a price of $0.50 per share and shall vest by December 31, 2016; c. Seventy-five thousand (75,000) options shall be exercisable at a price of $0.55 per share and shall vest by March 31, 2017; d. Seventy-five thousand (75,000) options shall be exercisable at a price of $0.55 per share and shall vest by June 30, 2017; e. Seventy-five thousand (75,000) options shall be exercisable at a price of $0.55 per share and shall vest by September 30, 2017; f. Seventy-five thousand (75,000) options shall be exercisable at a price of $0.60 per share and shall vest by December 31, 2017; g. Seventy-five thousand (75,000) options shall be exercisable at a price of $0.60 per share and shall vest by March 31, 2018; h. Seventy-five thousand (75,000) options shall be exercisable at a price of $0.60 per share and shall vest by June 30, 2018; Appointment of President and Chief Executive Officer On April 22, 2016, the Board approved the appointment of Mr. John D. Maatta as the Company’s President and Chief Executive Officer, effective as of May 3, 2016. Mr. Maatta will continue to serve as a member of the Board. In addition, the Board granted Mr. Maatta options to purchase up to an aggregate of 1,100,000 shares of the Company’s common stock, subject to the terms and conditions of the Third Amended and Restated 2011 Stock Incentive and Award Plan. Mr. Maatta formally entered into his Employment Agreement with the Company on July 17, 2016. Mr. Maatta received the following, with effective dates as defined below: 1) upon the effectiveness of the Maatta Appointment on May 3, 2016, three hundred thousand (300,000) options to purchase shares of the Company’s common stock at an exercise price of $0.50 per share, such options to vest only upon a Change in Control (as defined in Mr. Maatta’s Employment Agreement) during Mr. Maatta’s tenure as President and Chief Executive Officer; 2) upon the effectiveness of the Maatta Appointment on May 3, 2016, eight hundred thousand (800,000) options to purchase shares of the Company’s common stock, such options to vest, at the applicable exercise price, as follows: a. one hundred thousand (100,000) options shall be exercisable at a price of $0.50 per share and shall vest immediately; b. one hundred thousand (100,000) options shall be exercisable at a price of $0.50 per share and shall vest by September 30, 2016; c. one hundred thousand (100,000) options shall be exercisable at a price of $0.50 per share and shall vest by December 31, 2016; d. one hundred thousand (100,000) options shall be exercisable at a price of $0.55 per share and shall vest by March 31, 2017; e. one hundred thousand (100,000) options shall be exercisable at a price of $0.55 per share and shall vest by June 30, 2017; f. one hundred thousand (100,000) options shall be exercisable at a price of $0.55 per share and shall vest by September 30, 2017; g. one hundred thousand (100,000) options shall be exercisable at a price of $0.60 per share and shall vest by December 31, 2017; and h. one hundred thousand (100,000) options shall be exercisable at a price of $0.60 per share and shall vest by March 31, 2018. Consulting Agreement As discussed in Note 6, on December 29, 2016, the Company entered into a Consulting Services Agreement (the “Consulting Agreement”) with Bristol managed by Paul L. Kessler, the Chairman of the Company. Pursuant to the Consulting Agreement, Mr. Kessler will serve as Executive Chairman of the Company. The initial term of the Agreement is from December 29, 2016 through March 28, 2017 (the “Initial Term”). The term of the Consulting Agreement will be automatically extended for additional terms of 90 day periods each (each a “Renewal Term” and together with the Initial Term, the “Term”), unless either the Company or Bristol gives prior written notice of non-renewal to the other party no later than thirty (30) days prior to the expiration of the then current Term. During the Term, the Company will pay Bristol a monthly fee (the “Monthly Fee”) of Eighteen Thousand Seven Hundred Fifty and No/100 Dollars ($18,750). For services rendered by Bristol prior to entering into the Consulting Agreement, the Company will pay Bristol the Monthly Fee, pro-rated, for the time between September 1, 2016 and December 29, 2016. Bristol may also receive an annual bonus as determined by the Compensation Committee of the Company’s Board of Directors (the “Board”) and approved by the Board. At December 31, 2016, the Company accrued $75,000 of monthly fees due to Bristol. In addition, the Company will grant to Bristol options to purchase up to an aggregate of 600,000 shares of the Company’s common stock in accordance with the following vesting schedule and at the applicable exercise prices therein: Bristol received the following, with effective dates as defined below: 1) upon the effectiveness of the Consulting Agreement on December 29, 2016, seventy five thousand (75,000) options to purchase shares of the Company’s common stock at an exercise price of $0.50 per share, such options to vest upon execution of the agreement; 2) upon the effectiveness of the Consulting Agreement on December 29, 2016, five hundred twenty five thousand (525,000) options to purchase shares of the Company’s common stock, such options to vest, at the applicable exercise price, as follows: a. Seventy-five thousand (75,000) options shall be exercisable at a price of $0.50 per share and shall vest immediately; b. Seventy-five thousand (75,000) options shall be exercisable at a price of $0.55 per share and shall vest by March 31, 2017; c. Seventy-five thousand (75,000) options shall be exercisable at a price of $0.55 per share and shall vest by June 30, 2017; d. Seventy-five thousand (75,000) options shall be exercisable at a price of $0.55 per share and shall vest by September 30, 2017; e. Seventy-five thousand (75,000) options shall be exercisable at a price of $0.60 per share and shall vest by December 31, 2017; f. Seventy-five thousand (75,000) options shall be exercisable at a price of $0.60 per share and shall vest by March 31, 2018; and g. Seventy-five thousand (75,000) options shall be exercisable at a price of $0.60 per share and shall vest by June 30, 2018. Operating Lease Effective July 17, 2014, the Company entered into a sublease, as lessee, with Ironclad Performance Wear Corporation, as lessor, for new space located in El Segundo, California (the “Ironclad Sublease”). The term of the Ironclad Sublease was for one year and ten (10) months commencing on September 1, 2014. Pursuant to the Ironclad Sublease, the Company paid base rent of $11,132 per month and an initial security deposit of $11,466 was required. The lease matured during the three months ended March 31, 2016. The Company is awaiting the return of the security deposit from the lessor. On June 16, 2016, the Company entered into a Standard Multi-Tenant Sublease (“Sublease”) with Bristol Capital Advisors, an entity controlled by the Company’s Chairman of the Board. The term of the Sublease is for 5 years and 3 months beginning on July 1, 2016 with monthly payments of $8,118. Upon execution of the Sublease, the Company paid a security deposit of $9,137 and $199,238 for prepaid rent of which $181,796 remains at December 31, 2016. During the year ended December 31, 2016, the Company incurred total rent expense of $24,354 under the Sublease. See below for future minimum rent payments due. Future minimum lease payments inclusive of related tax required under the non-cancelable operating lease are as follows: Fiscal year ending December 31: 2017 $ 145,800 2018 97,416 2019 97,416 2020 97,416 Thereafter 73,062 $ 511,110 Obligation to Fund CONtv As discussed in Note 3, on November 16, 2015, pursuant to that certain A&R Operating Agreement for CONtv, the Company’s ownership interest in CONtv was reduced to 10%. In addition, the Company is only obligated to fund on-going costs in the amount of $25,000 in cash on an on-going monthly basis for a period of 12 months following the effective date. For the years ended December 31, 2016 and 2015, the Company recognized $262,500 and $1,324,727 in losses from this venture, respectively. As of December 31, 2016 and 2015, the Company has a balance due to CONtv of $224,241 and $111,741, respectively. Stephen Shamus Lawsuit On October 28, 2016, the Company filed a Complaint (the “Complaint”) and commenced a lawsuit in the United States District Court, Southern District of New York, against Stephen Shamus, the former Chief Marketing Officer of the Company whose employment was terminated on October 27, 2016 (the “Shamus Lawsuit”). In the Shamus Lawsuit, the Company alleges, among other things, breach of fiduciary duty, misappropriation of corporation assets, breach of contract, and conversion, against Mr. Shamus relating to the Company’s assertion that he used his position with the Company to improperly obtain memorabilia at the Company’s comic conventions which he would then sell and retain the profits from for his own benefit. On November 16, 2016, Mr. Shamus filed an Answer to the Complaint with counterclaims to the Complaint (the “Counterclaim”). The Counterclaim alleges breach of contract and unjust enrichment against the Company and seeks compensatory damages in the form of cash. The lawsuit was concluded on February 15, 2017 with no financial impact on the Company’s financial statements. Gareb Shamus Lawsuit On December 16, 2016, the Company filed a Complaint (the “DNJ Complaint”) and commenced a lawsuit in the United States District Court, District of New Jersey (the “DNJ Lawsuit”), against Gareb Shamus, the founder and former Chief Executive Officer of the Company; Pivot Media LLC and 4 Brothers LLC, entities owned and operated by Gareb Shamus; Stephen Shamus, the former Chief Marketing Officer of the Company whose employment was terminated on October 27, 2016; Kenneth Shamus, a former director of the Company; Eric Weisblum; GEM Funding LLC; It’s All Normal LLC; and various other defendants (collectively, the “DNJ Defendants”). In the DNJ Complaint, the Company alleged that the DNJ Defendants violated Section 13(d) of the Securities and Exchange Act of 1934 and SEC Rules 13d-1 and 13d-5. The Company sought an injunction to compel the DNJ Defendants to make complete disclosure under Section 13(d) of the Exchange Act and to cure their past violations. The DNJ Lawsuit was concluded on February 15, 2017 with no financial impact on the Company’s financial statements. Silverman Lawsuit On January 11, 2017, Arden B. Silverman (“Silverman”), d/b/a Capital Asset Protection, filed a complaint (the “Silverman Complaint”) and commenced a lawsuit against the Company in the Superior Court of California, County of Los Angeles – Central District (the “Silverman Lawsuit”). Silverman brought the claim after being assigned the right title and interest in a claim against the Company by Rogers & Cowan, Inc., a California corporation (Rogers & Cowan). The Silverman Complaint alleges the Company owes $42,600 plus attorney’s fees to Silverman for services provided by Rogers & Cowan to the Company. On April 10, 2017, the Company filed a cross Cross-Complaint in the Silverman Lawsuit against Roger and Cowan, among others (the “Cross-Complaint”). The Cross-Complaint seeks in excess of $90,000 from Rogers & Cowan, among others, and alleges, fraud, negligent misrepresentation, breach of written agreement; breach of covenant of good faith and fair dealings, and violations of Cal. Bus. & Prof. Code §§17200 et seq. With the exception of the foregoing disputes, the Company is not involved in any disputes and does not have any litigation matters pending which the Company believes could have a materially adverse effect on the Company’s financial condition or results of operations. |
Stockholders' Equity (Deficit)
Stockholders' Equity (Deficit) | 12 Months Ended |
Dec. 31, 2016 | |
Equity [Abstract] | |
Stockholders' Equity (Deficit) | Note 8 – Stockholders’ Equity (Deficit) The Company’s authorized capital stock consists of 100,000,000 shares, of which 80,000,000 are for shares of common stock, par value $0.0001 per share, and 20,000,000 are for shares of preferred stock, par value $0.0001 per share, of which 50,000 have been designated as Series A Cumulative Convertible Preferred Stock. As of December 31, 2016 and 2015, there were 68,535,036 and 51,368,386 shares of common stock issued and outstanding, respectively. Each share of the common stock entitles its holder to one vote on each matter submitted to the shareholders. Equity Incentive Plan On May 9, 2011, the Board approved, authorized and adopted (subject to stockholder approval) the 2011 Incentive Stock and Award Plan (the “Plan”). The Plan was amended on September 14, 2011, April 11, 2012, July 9, 2012 and September 25, 2014. The Plan provides for the issuance of up to 15,000,000 shares of common stock, par value $.0001 per share, of the Company through the grant of non-qualified options (the “Non-qualified Options”), incentive options (the “Incentive Options” and together with the Non-qualified Options, the “Options”) and restricted stock (the “Restricted Stock”) to directors, officers, consultants, attorneys, advisors and employees. The Plan shall be administered by a committee consisting of two or more independent, non-employee and outside directors (the “Committee”). In the absence of such a Committee, the Board shall administer the Plan. Each Option shall contain the following material terms: (i) the exercise price, which shall be determined by the Committee at the time of grant, shall not be less than 100% of the Fair Market Value (defined as the closing price on the final trading day immediately prior to the grant on the principal exchange or quotation system on which the common stock is listed or quoted, as applicable) of the common stock of the Company, provided (ii) the term of each Option shall be fixed by the Committee, provided provided further (iii) subject to acceleration in the event of a Change of Control of the Company (as further described in the Plan), the period during which the Options vest shall be designated by the Committee or, in the absence of any Option vesting periods designated by the Committee at the time of grant, shall vest and become exercisable in equal amounts on each fiscal quarter of the Company through the four (4) year anniversary of the date on which the Option was granted; (iv) no Option is transferable and each is exercisable only by the recipient of such Option except in the event of the death of the recipient; and (v) with respect to Incentive Options, the aggregate Fair Market Value of common stock exercisable for the first time during any calendar year shall not exceed $100,000. Each award of Restricted Stock is subject to the following material terms: (i) no rights to an award of Restricted Stock is granted to the intended recipient of Restricted Stock unless and until the grant of Restricted Stock is accepted within the period prescribed by the Committee; (ii) Restricted Stock shall not be delivered until they are free of any restrictions specified by the Committee at the time of grant; (iii) recipients of Restricted Stock have the rights of a stockholder of the Company as of the date of the grant of the Restricted Stock; (iv) shares of Restricted Stock are forfeitable until the terms of the Restricted Stock grant have been satisfied or the employment with the Company is terminated; and (v) the Restricted Stock is not transferable until the date on which the Committee has specified such restrictions have lapsed. Stock Options The following is a summary of the Company’s option activity: Options Weighted Average Exercise Price Outstanding – January 1, 2015 9,725,000 $ 0.71 Exercisable – January 1, 2015 1,592,500 $ 0.44 Granted 218,500 $ 0.41 Exercised (10,000 ) $ - Forfeited/Cancelled - $ - Outstanding – December 31, 2015 9,933,500 $ 0.70 Exercisable – December 31, 2015 4,332,500 $ 0.41 Granted 2,000,000 $ 0.55 Exercised - $ - Forfeited/Cancelled (6,614,500 ) $ - Outstanding – December 31, 2016 5,319,000 $ 0.57 Exercisable – December 31, 2016 1,640,500 $ 0.47 Options Outstanding Options Exercisable Exercise Price Number Outstanding Weighted Average Remaining Contractual Life (in years) Weighted Average Exercise Price Number Exercisable Weighted Average Exercise Price $ 0.40 - 1.50 5,319,000 3.24 years $ 0.57 1,640,500 $ 0.47 At December 31, 2016, the total intrinsic value of options outstanding and exercisable was $0 and $0, respectively. The Company recognized an aggregate of $777,536 and $1,315,869 in compensation expense during the years ended December 31, 2016 and 2015, respectively, related to option awards. At December 31, 2016, unrecognized stock based compensation was $556,648. Stock Warrants The following is a summary of the Company’s warrant activity: Warrants Weighted Average Exercise Price Outstanding – January 1, 2016 - $ - Exercisable – January 1, 2016 - $ - Granted 33,333,317 $ 0.08 Exercised (16,666,650 ) $ 0.00 Forfeited/Cancelled - $ - Outstanding – December 31, 2016 16,666,667 $ 0.15 Exercisable – December 31, 2016 16,666,667 $ 0.15 Warrants Outstanding Warrants Exercisable Exercise Price Number Outstanding Weighted Average Remaining Contractual Life (in years) Weighted Average Exercise Price Number Exercisable Weighted Average Exercise Price $ 0.15 16,666,667 4.92 years $ 0.15 16,666,667 $ 0.15 At December 31, 2016, the total intrinsic value of warrants outstanding and exercisable was $0 and $0, respectively. The following table summarizes the range of assumptions the Company utilized to estimate the fair value of the options and warrants issued during the year ended December 31, 2016 and 2015: Assumptions December 31, 2016 December 31, 2015 Expected term (years) 2.40-5.00 5.00 Expected volatility 90%-115 % 122 % Risk-free interest rate 0.87% - 1.96 % 1.71 % Dividend yield 0.00 % 0.00 % The expected warrant term is based on the contractual term. The expected option term is computed using the “simplified” method as permitted under the provisions of ASC 718-10-S99. The Company uses the simplified method to calculate expected term of share options and similar instruments as the Company does not have sufficient historical exercise data to provide a reasonable basis upon which to estimate expected term. The expected volatility is based on historical-volatility of the Company when stock prices were publicly available. The risk-free interest rate is based on the U.S. Treasury yields with terms equivalent to the expected term of the related option at the valuation date. Dividend yield is based on historical trends. |
Credit Risk
Credit Risk | 12 Months Ended |
Dec. 31, 2016 | |
Risks and Uncertainties [Abstract] | |
Credit Risk | Note 9 – Credit Risk Financial instruments that potentially subject the Company to significant concentration of credit risk consist primarily of cash and cash equivalents. As of December 31, 2016, substantially all of the Company’s cash and cash equivalents were held by major financial institutions and the balance in certain accounts exceeded the maximum amount insured by the Federal Deposits Insurance Corporation (“FDIC”). However, the Company has not experienced losses on these accounts and management believes that the Company is not exposed to significant risks on such accounts. |
Segment Information
Segment Information | 12 Months Ended |
Dec. 31, 2016 | |
Segment Reporting [Abstract] | |
Segment Information | Note 10 – Segment Information The Company evaluates performance of its operating segments based on revenue and operating profit (loss). Segment information for the years ended December 31, 2016 and 2015 and as of December 31, 2016 and 2015, are as follows: Conventions ConBox Total Year ended December 31, 2016 Revenue $ 21,994,433 $ 707,101 $ 22,701,534 Cost of revenue (14,972,190 ) (1,029,898 ) (16,002,088 ) Write-off of obsolete inventory (164,903 ) - (164,903 ) Gross margin 6,857,340 (322,797 ) 6,534,543 Operating expenses (7,627,847 ) (88,942 ) (7,716,789 ) Operating loss (770,507 ) (411,739 ) (1,182,246 ) Year ended December 31, 2015 Revenue $ 22,905,636 $ 1,120,535 $ 24,026,171 Cost of revenue (17,744,611 ) (1,015,420 ) (18,760,031 ) Gross margin 5,161,025 105,115 5,266,140 Operating expenses (8,099,836 ) (48,132 ) (8,147,968 ) Operating profit (loss) (2,938,811 ) 56,983 (2,881,828 ) December 31, 2016 Accounts receivable, net $ 128,561 $ 59,258 $ 187,819 Total assets 5,775,871 59,258 5,835,129 Unearned revenue 1,479,392 95,546 1,574,938 December 31, 2015 Accounts receivable, net $ 108,795 $ 298,347 $ 407,142 Total assets 6,106,772 664,722 6,771,494 Unearned revenue 3,340,837 390,661 3,731,498 |
Income Tax Provision
Income Tax Provision | 12 Months Ended |
Dec. 31, 2016 | |
Income Tax Disclosure [Abstract] | |
Income Tax Provision | Note 11 – Income Tax Provision Deferred Tax Assets At December 31, 2016, the Company has available for U.S. federal income tax purposes a net operating loss (“NOL”) carry-forwards of approximately $9,504,000 that may be used to offset future taxable income through the fiscal year ending December 31, 2036. If not used, these NOLs may be subject to limitation under Internal Revenue Code Section 382 should there be a greater than 50% ownership change as determined under the regulations. The Company plans on undertaking a detailed analysis of any historical and/or current Section 382 ownership changes that may limit the utilization of the net operating loss carryovers. No tax benefit has been reported with respect to these net operating loss carry-forwards in the accompanying consolidated financial statements since the Company believes that the realization of its net deferred tax asset of approximately $3,231,000 was not considered more likely than not and accordingly, the potential tax benefits of the net loss carry-forwards are fully offset by a valuation allowance of $3,231,000. Deferred tax assets consist primarily of the tax effect of NOL carry-forwards. The Company has provided a full valuation allowance on the deferred tax assets because of the uncertainty regarding its realizability. In assessing the realization of deferred tax assets, management considers whether it is more likely than not that some portion or all of the deferred tax assets will not be realized. The ultimate realization of deferred tax assets is dependent upon future generation for taxable income during the periods in which temporary differences representing net future deductible amounts become deductible. Management considers the scheduled reversal of deferred tax liabilities, projected future taxable income and tax planning strategies in making this assessment. After consideration of all the information available, Management believes that significant uncertainty exists with respect to future realization of the deferred tax assets and has therefore established a full valuation allowance. The valuation allowance increased by approximately $1,987,000 and $984,000 for the year ended December 31, 2016 and 2015, respectively. The Company evaluated the provisions of ASC 740 related to the accounting for uncertainty in income taxes recognized in an enterprise’s financial statements. ASC 740 prescribes a comprehensive model for how a company should recognize, present, and disclose uncertain positions that the Company has taken or expects to take in its tax return. For those benefits to be recognized, a tax position must be more-likely-than-not to be sustained upon examination by taxing authorities. Differences between tax positions taken or expected to be taken in a tax return and the net benefit recognized and measured pursuant to the interpretation are referred to as “unrecognized benefits.” A liability is recognized (or amount of net operating loss carry forward or amount of tax refundable is reduced) for unrecognized tax benefit because it represents an enterprise’s potential future obligation to the taxing authority for a tax position that was not recognized as a result of applying the provisions of ASC 740. If applicable, interest costs related to the unrecognized tax benefits are required to be calculated and would be classified as “Other expenses – Interest expense” in the statement of operations. Penalties would be recognized as a component of “General and administrative.” No interest or penalties on unpaid tax were recorded during the years ended December 31, 2016 and 2015, respectively. As of December 31, 2016 and 2015, no liability for unrecognized tax benefits was required to be reported. The Company does not expect any significant changes in its unrecognized tax benefits in the next year. Components of deferred tax assets are as follows: December 31, 2016 December 31, 2015 Net deferred tax assets – Non-current: Expected income tax benefit from NOL carry-forwards $ 1,987,000 $ 993,000 Less valuation allowance (1,987,000 ) (993,000 ) Deferred tax assets, net of valuation allowance $ - $ - Income Tax Provision in the Consolidated Statements of Operations A reconciliation of the federal statutory income tax rate and the effective income tax rate as a percentage of income before income taxes is as follows: For the Year Ended December 31, 2016 For the Year Ended December 31, 2015 Federal statutory income tax rate 34.0 % 34.0 % Change in valuation allowance on net operating loss carry-forwards (34.0 %) (34.0 %) Effective income tax rate 0.0 % 0.0 % |
Significant and Critical Acco18
Significant and Critical Accounting Policies and Practices (Policies) | 12 Months Ended |
Dec. 31, 2016 | |
Accounting Policies [Abstract] | |
Basis of Presentation | Basis of Presentation The Company’s consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“US GAAP”). |
Use of Estimates and Assumptions and Critical Accounting Estimates and Assumptions | Use of Estimates and Assumptions and Critical Accounting Estimates and Assumptions The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the dates of the financial statements and the reported amounts of revenues and expenses during the reporting periods. Actual results could differ from those estimates. |
Principles of Consolidation | Principles of Consolidation The consolidated financial statements include all accounts of the entities as of the reporting period ending date(s) and for the reporting period(s) as follows: Name of consolidated subsidiary or entity State or other jurisdiction of incorporation or organization Date of incorporation or formation (date of acquisition, if applicable) Attributable interest KTC Corp. The State of Nevada, U.S.A. September 20, 2010 100 % Kicking the Can L.L.C. The State of Delaware, U.S.A. April 17, 2009 100 % Wizard World Digital, Inc. The State of Nevada, U.S.A. March 18, 2011 100 % Wiz Wizard, LLC The State of Delaware, U.S.A. December 29, 2014 100 % ButtaFyngas, LLC The State of Delaware, U.S.A. April 10, 2015 50 % All inter-company balances and transactions have been eliminated. Non–controlling interest represents the minority equity investment in the Company’s subsidiaries, plus the minority investors’ share of the net operating results and other components of equity relating to the non–controlling interest. As of December 31, 2016, the aggregate non-controlling interest in ButtaFyngas was ($11,817). As of December 31, 2015, the aggregate non-controlling interest in Wiz Wizard and ButtaFyngas was ($10,786). The non-controlling interest is separately disclosed on the Consolidated Balance Sheet. |
Cash and Cash Equivalents | Cash and Cash Equivalents The Company considers investments with original maturities of three months or less to be cash equivalents. The Company minimizes its credit risk associated with cash by periodically evaluating the credit quality of its primary financial institution. The balance at times may exceed federally insured limits. |
Fair Value of Financial Instruments | Fair Value of Financial Instruments For purpose of this disclosure, the fair value of a financial instrument is the amount at which the instrument could be exchanged in a current transaction between willing parties, other than in a forced sale or liquidation. The carrying amount of the Company’s short-term financial instruments approximates fair value due to the relatively short period to maturity for these instruments. |
Accounts Receivable and Allowance for Doubtful Accounts | Accounts Receivable and Allowance for Doubtful Accounts Accounts receivable are stated at the amount management expects to collect from outstanding balances. The Company generally does not require collateral to support customer receivables. The Company provides an allowance for doubtful accounts based upon a review of the outstanding accounts receivable, historical collection information and existing economic conditions. The Company determines if receivables are past due based on days outstanding, and amounts are written off when determined to be uncollectible by management. The maximum accounting loss from the credit risk associated with accounts receivable is the amount of the receivable recorded, which is the face amount of the receivable net of the allowance for doubtful accounts. As of December 31, 2016 and 2015, the allowance for doubtful accounts was $0 and $426,532, respectively. |
Inventories | Inventories Inventories are stated at average cost using the first-in, first-out (FIFO) valuation method. Inventory was comprised of the following: December 31, 2016 December 31, 2015 Finished goods $ - $ 39,552 |
Property and Equipment | Property and Equipment Property and equipment are recorded at cost. Expenditures for major additions and betterments are capitalized. Maintenance and repairs are charged to operations as incurred. Depreciation is computed by the straight-line method (after taking into account their respective estimated residual values) over the estimated useful lives of the respective assets as follows: Estimated Useful Life (Years) Computer equipment 3 Equipment 2-5 Furniture and fixture 7 Leasehold improvements * (*) Amortized on a straight-line basis over the term of the lease or the estimated useful lives, whichever period is shorter. Upon sale or retirement of property and equipment, the related cost and accumulated depreciation are removed from the accounts and any gain or loss is reflected in the consolidated statements of operations. |
Investments - Cost Method, Equity Method and Joint Venture | Investments - Cost Method, Equity Method and Joint Venture In accordance with sub-topic 323-10 of the FASB ASC (“Sub-topic 323-10”), the Company accounts for investments in common stock of an investee for which the Company has significant influence in the operating or financial policies even though the Company holds 50% or less of the common stock or in-substance common stock. |
Method of Accounting | Method of Accounting Investments held in stock of entities other than subsidiaries, namely corporate joint ventures and other non-controlled entities usually are accounted for by one of three methods: (i) the fair value method (addressed in Topic 320), (ii) the equity method (addressed in Topic 323), or (iii) the cost method (addressed in Subtopic 325-20). Pursuant to Paragraph 323-10-05-5, the equity method tends to be most appropriate if an investment enables the investor to influence the operating or financial policies of the investee. |
Investment in Contv | Investment in CONtv On August 27, 2014, the Company entered into a joint venture and executed an Operating Agreement for CON TV LLC (“CONtv”) with Cinedigm Entertainment Corp. (“Cinedigm”), ROAR, LLC (a related party partially owned by a member of the Board) (“ROAR”) and Bristol Capital, LLC (a related party controlled by a member of the Board) (“Bristol Capital”). The Company owned a 47.50% interest in the newly formed entity, CONtv. The Company was accounting for the interest in the joint venture utilizing the equity method of accounting. On November 16, 2015, pursuant to that certain Amended and Restated Operating Agreement for CONtv by and among the aforementioned parties (the “A&R Operating Agreement”), the Company’s ownership interest in CONtv was reduced to 10%. Pursuant to the A&R Operating Agreement, the Company is only obligated to fund on-going costs in the amount of $25,000 in cash on an on-going monthly basis for a period of 12 months following the effective date. For the years ended December 31, 2016 and 2015, the Company recognized $262,500 and $1,324,727 in losses from this venture, respectively. As of December 31, 2016 and 2015, the investment in CONtv was $0. |
Fair Value of Financial Instruments | Fair Value of Financial Instruments The Company follows ASC 820-10 of the FASB Accounting Standards Codification to measure the fair value of its financial instruments and disclosures about fair value of its financial instruments. ASC 820-10 establishes a framework for measuring fair value in accounting principles generally accepted in the United States of America (U.S. GAAP), and expands disclosures about fair value measurements. To increase consistency and comparability in fair value measurements and related disclosures, ASC 820-10 establishes a fair value hierarchy which prioritizes the inputs to valuation techniques used to measure fair value into three (3) broad levels. The three (3) levels of fair value hierarchy defined by ASC 820-10 are described below: Level 1 Quoted market prices available in active markets for identical assets or liabilities as of the reporting date. Level 2 Pricing inputs other than quoted prices in active markets included in Level 1, which are either directly or indirectly observable as of the reporting date. Level 3 Pricing inputs that are generally unobservable inputs and not corroborated by market data. Financial assets are considered Level 3 when their fair values are determined using pricing models, discounted cash flow methodologies or similar techniques and at least one significant model assumption or input is unobservable. The fair value hierarchy gives the highest priority to quoted prices (unadjusted) in active markets for identical assets or liabilities and the lowest priority to unobservable inputs. If the inputs used to measure the financial assets and liabilities fall within more than one level described above, the categorization is based on the lowest level input that is significant to the fair value measurement of the instrument. The carrying amounts of the Company’s financial assets and liabilities, such as cash, accounts receivable, inventory, prepaid expenses and other current assets, accounts payable and accrued expenses approximate their fair values because of the short maturity of these instruments. In connection with the securities purchase agreement and debt transactions during the year ended December 31, 2016, the Company issued warrants, to purchase common stock with an exercise price of $0.15 and a five-year term. The Company identified certain put features embedded in the warrants that potentially could result in a net cash settlement in the event of a fundamental transaction, requiring the Company to classify the warrants as a derivative liability. In connection with the issuance of a convertible promissory note as discussed below in Note 6, the Company evaluated the note agreement to determine if the agreement contained any embedded components that would qualify the agreement as a derivative. The Company identified certain put features embedded in the convertible note agreement that potentially could result in a net cash settlement in the event of a fundamental transaction, requiring the Company to classify the conversion feature as a derivative liability. The Company determined that it is not practical to estimate the fair value of the convertible promissory note payable because of its unique nature and the costs that would be incurred to obtain an independent valuation. The Company does not have comparable outstanding debt on which to base an estimated current borrowing rate or other discount rate for purposes of estimating the fair value of the convertible note payable and the Company has not been able to develop a valuation model that can be applied consistently in a cost-efficient manner. These factors all contribute to the impracticability of estimating the fair value of the notes payable. At December 31, 2016 and 2015, the carrying value of the convertible promissory note payable net of debt discount was $1,456 and $0. At December 31, 2016, the Company recorded accrued interest of $24,243 and $0, which is included on the Consolidated Balance Sheets in the accounts payable and accrued expenses line item. Transactions involving related parties typically cannot be presumed to be carried out on an arm’s-length basis, as the requisite conditions of competitive, free-market dealings may not exist. However, in the case of the convertible promissory note discussed in Note 6, the Company obtained a fairness opinion from an independent third party which supports that the transaction was carried out at an arm’s length basis. The Company’s Level 3 financial liabilities consist of the derivative conversion features issued in 2016. The Company valued the conversion features using a Monte Carlo model. These models incorporate transaction details such as the Company’s stock price, contractual terms, maturity, risk free rates, and volatility as of the date of issuance and each balance sheet date. The Company utilized the following management assumptions in valuing the derivative conversion feature during the year ended December 31, 2016: Exercise price $ 0.12 - 0.15 Risk free interest rate 1.14% – 1.93 % Dividend yield 0.00 % Expected volatility 94% - 115 % Remaining term 2 to 5 years |
Fair Value of Financial Assets and Liabilities Measured on a Recurring Basis | Fair Value of Financial Assets and Liabilities Measured on a Recurring Basis The Company uses Level 3 of the fair value hierarchy to measure the fair value of the derivative liabilities and revalues its derivative liability at every reporting period and recognizes gains or losses in the statements of operations that are attributable to the change in the fair value of the derivative liability. Financial assets and liabilities measured at fair value on a recurring basis are summarized below and disclosed on the balance sheets as follows: Fair Value Measurement Using Carrying Value Level 1 Level 2 Level 3 Total Embedded conversion feature $ 3,298,000 $ - $ - $ 3,298,000 $ 3,298,000 Warrant liability 3,200,137 - - 3,200,137 3,200,137 December 31, 2016 $ 6,498,737 $ - $ - $ 6,498,737 $ 6,498,737 The unobservable level 3 inputs used by the Company was the expected volatility assumption used in the Monte Carlo pricing model. Expected volatility is based on the historical stock price of the Company’s common stock. The following table provides a summary of the changes in fair value, including net transfers in and/or out, of all financial assets measured at fair value on a recurring basis using significant unobservable inputs during the year ended December 31, 2016. Warrants Convertible Note Total Balance – December 31, 2015 $ - $ - $ - Issuance of derivative liabilities 5,206,444 2,294,435 7,500,879 Extinguishment of derivative liability from exercise of warrants (2,831,851 ) - (2,831,851 ) Change in fair value of derivative liability 825,544 1,004,165 1,829,709 Balance – December 31, 2016 $ 3,200,137 $ 3,298,000 $ 6,498,737 Changes in the unobservable input values could potentially cause material changes in the fair value of the Company’s Level 3 financial instruments. The significant unobservable inputs used in the fair value measurements is the expected volatility assumption. A significant increase (decrease) in the expected volatility assumption could potentially result in a higher (lower) fair value measurement. |
Derivative Instruments | Derivative Instruments The Company evaluates its convertible debt, warrants or other contracts to determine if those contracts or embedded components of those contracts qualify as derivatives to be separately accounted for in accordance with ASC 815-15. The result of this accounting treatment is that the fair value of the embedded derivative is marked-to-market each balance sheet date and recorded as a liability. In the event that the fair value is recorded as a liability, the change in fair value is recorded in the statements of operations as other income or expense. Upon conversion or exercise of a derivative instrument, the instrument is marked to fair value at the conversion date and then that fair value is reclassified to equity. In circumstances where the embedded conversion option in a convertible instrument is required to be bifurcated and there are also other embedded derivative instruments in the convertible instrument that are required to be bifurcated, the bifurcated derivative instruments are accounted for as a single, compound derivative instrument. The classification of derivative instruments, including whether such instruments should be recorded as liabilities or as equity, is re-assessed at the end of each reporting period. Equity instruments that are initially classified as equity that become subject to reclassification are reclassified to liability at the fair value of the instrument on the reclassification date. |
Revenue Recognition and Cost Revenues | Revenue Recognition and Cost of Revenues The Company follows Paragraph 605-10-S99-1 of the FASB Accounting Standards Codification for revenue recognition. The Company will recognize revenue when it is realized or realizable and earned. The Company considers revenue realized or realizable and earned when all of the following criteria are met: (i) persuasive evidence of an arrangement exists, (ii) the product has been shipped or the services have been rendered to the customer, (iii) the sales price is fixed or determinable, and (iv) collectability is reasonably assured. Convention revenue is generally earned upon completion of the convention. Unearned convention revenue is deposits received for conventions that have not yet taken place, which are fully or partially refundable depending upon the terms and conditions of the agreements. Unearned ConBox revenue is non-refundable up-front payments for products. These payments are initially deferred and subsequently recognized over the subscription period, typically three months, and upon shipment of the product. The Company recognizes cost of revenues in the period in which the revenues was earned. In the event the Company incurs cost of revenues for conventions that are yet to occur, the Company records such amounts as prepaid expenses and such prepaid expenses are expensed during the period the convention takes place. |
Shipping and Handling Costs | Shipping and Handling Costs The Company accounts for shipping and handling fees in accordance with paragraph 605-45-45-19 of the FASB Accounting Standards Codification. While amounts charged to customers for shipping products are included in revenues, the related costs are classified in cost of revenue as incurred. Shipping and handling costs were $178,931 and $176,986 for the years ended December 31, 2016 and 2015, respectively. |
Equity-based Compensation | Equity–based compensation The Company recognizes compensation expense for all equity–based payments in accordance with ASC 718 “ Compensation – Stock Compensation Restricted stock awards are granted at the discretion of the Company. These awards are restricted as to the transfer of ownership and generally vest over the requisite service periods, typically over a four-year period (vesting on a straight–line basis). The fair value of a stock award is equal to the fair market value of a share of Company stock on the grant date. The fair value of option award is estimated on the date of grant using the Black–Scholes option valuation model. The Black–Scholes option valuation model requires the development of assumptions that are input into the model. These assumptions are the expected stock volatility, the risk–free interest rate, the expected life of the option, the dividend yield on the underlying stock and the expected forfeiture rate. Expected volatility is calculated based on the historical volatility of the Company’s Common stock over the expected option life and other appropriate factors. The expected option term is computed using the “simplified” method as permitted under the provisions of ASC 718-10-S99. The Company uses the simplified method to calculate expected term of share options and similar instruments as the Company does not have sufficient historical exercise data to provide a reasonable basis upon which to estimate expected term. Risk–free interest rates are calculated based on continuously compounded risk–free rates for the appropriate term. The dividend yield is assumed to be zero as the Company has never paid or declared any cash dividends on the Common stock of the Company and does not intend to pay dividends on the Common stock in the foreseeable future. The expected forfeiture rate is estimated based on historical experience. Determining the appropriate fair value model and calculating the fair value of equity–based payment awards requires the input of the subjective assumptions described above. The assumptions used in calculating the fair value of equity–based payment awards represent management’s best estimates, which involve inherent uncertainties and the application of management’s judgment. As a result, if factors change and the Company uses different assumptions, the equity–based compensation could be materially different in the future. In addition, the Company is required to estimate the expected forfeiture rate and recognize expense only for those shares expected to vest. If the actual forfeiture rate is materially different from the Company’s estimate, the equity–based compensation could be significantly different from what the Company has recorded in the current period. The Company accounts for share–based payments granted to non–employees in accordance with ASC 505-40, “ Equity Based Payments to Non–Employees |
Income Taxes | Income Taxes Income taxes are provided in accordance with ASC No. 740, “ Accounting for Income Taxes Deferred tax assets are reduced by a valuation allowance when, in the opinion of management, it is more likely than not that some portion or all of the deferred tax assets will not be realized. Deferred tax assets and liabilities are adjusted for the effects of changes in tax laws and rates on the date of enactment. The Company is no longer subject to tax examinations by tax authorities for years prior to 2013. During the year ended December 31, 2016, the Company partially utilized NOL carry-forwards to offset taxable income. |
Earnings Per Share | Earnings per Share Earnings per share (“EPS”) is the amount of earnings attributable to each share of common stock. For convenience, the term is used to refer to either earnings or loss per share. EPS is computed pursuant to Section 260-10-45 of the FASB Accounting Standards Codification. Pursuant to ASC Paragraphs 260-10-45-10 through 260-10-45-16, basic EPS shall be computed by dividing income available to common stockholders (the numerator) by the weighted-average number of common shares outstanding (the denominator) during the period. Income available to common stockholders shall be computed by deducting both the dividends declared in the period on preferred stock (whether or not paid) and the dividends accumulated for the period on cumulative preferred stock (whether or not earned) from income from continuing operations (if that amount appears in the income statement) and also from net income. The computation of diluted EPS is similar to the computation of basic EPS except that the denominator is increased to include the number of additional common shares that would have been outstanding if the dilutive potential common shares had been issued during the period to reflect the potential dilution that could occur from common shares issuable through contingent shares issuance arrangement, stock options or warrants. The following table shows the outstanding dilutive common shares excluded from the diluted net income (loss) per share calculation as they were anti-dilutive: Contingent shares issuance arrangement, stock options or warrants For the Year Ended December 31, 2016 For the Year Ended December 31, 2015 Convertible note 16,666,667 - Common stock options 5,319,000 9,933,500 Common stock warrants 16,666,667 - Total contingent shares issuance arrangement, stock options or warrants 38,652,334 9,933,500 |
Reclassification | Reclassification Certain prior period amounts have been reclassified to conform to current period presentation. |
Recently Issued Accounting Pronouncements | Recently Issued Accounting Pronouncements In August 2014, the FASB issued ASU 2014-15, “ Presentation of Financial Statements-Going Concern (Subtopic 205-40): Disclosure of Uncertainties about an Entity’s Ability to Continue as a Going Concern In July 2015, the FASB issued the ASU No. 2015-11 “ Inventory (Topic 330) Simplifying the Measurement of Inventory” . In February 2016, the FASB issued ASU 2016-02, “Leases (Topic 842).” In March 2016, the FASB issued ASU No. 2016-06, “ Derivatives and Hedging” (topic 815) In April 2016, the FASB issued ASU No. 2016-10, “ Revenue from Contracts with Customers: Identifying Performance Obligations and Licensing (Topic 606) Revenue from Contracts with Customers: Principal versus Agent Considerations (Reporting Revenue Gross verses Net) (Topic 606) In April 2016, the FASB issued ASU No. 2016-09, “ Compensation – Stock Compensation (Topic 718) In May 2016, the FASB issued ASU No. 2016-12, “ Revenue from Contracts with Customers (Topic 606): Narrow-Scope Improvements and Practical Expedients” In August 2016, the FASB issued ASU 2016-15, “Statement of Cash Flows (Topic 230): Classification of Certain Cash Receipts and Cash Payments” In October 2016, the FASB issued ASU 2016-16, “Income Taxes (Topic 740): Intra-Entity Transfers of Assets Other than Inventory”, In November 2016, the FASB issued ASU 2016-18, “Statement of Cash Flows (Topic 230)” Management does not believe that any recently issued, but not yet effective accounting pronouncements, when adopted, will have a material effect on the accompanying consolidated financial statements. |
Significant and Critical Acco19
Significant and Critical Accounting Policies and Practices (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Accounting Policies [Abstract] | |
Schedule of Consolidated Interest in Controlling Entities | The consolidated financial statements include all accounts of the entities as of the reporting period ending date(s) and for the reporting period(s) as follows: Name of consolidated subsidiary or entity State or other jurisdiction of incorporation or organization Date of incorporation or formation (date of acquisition, if applicable) Attributable interest KTC Corp. The State of Nevada, U.S.A. September 20, 2010 100 % Kicking the Can L.L.C. The State of Delaware, U.S.A. April 17, 2009 100 % Wizard World Digital, Inc. The State of Nevada, U.S.A. March 18, 2011 100 % Wiz Wizard, LLC The State of Delaware, U.S.A. December 29, 2014 100 % ButtaFyngas, LLC The State of Delaware, U.S.A. April 10, 2015 50 % |
Schedule of Inventories | Inventories are stated at average cost using the first-in, first-out (FIFO) valuation method. Inventory was comprised of the following: December 31, 2016 December 31, 2015 Finished goods $ - $ 39,552 |
Schedule of Estimated Useful Life | Depreciation is computed by the straight-line method (after taking into account their respective estimated residual values) over the estimated useful lives of the respective assets as follows: Estimated Useful Life (Years) Computer equipment 3 Equipment 2-5 Furniture and fixture 7 Leasehold improvements * (*) Amortized on a straight-line basis over the term of the lease or the estimated useful lives, whichever period is shorter. |
Schedule of Weighted Average Assumptions | The Company utilized the following management assumptions in valuing the derivative conversion feature during the year ended December 31, 2016: Exercise price $ 0.12 - 0.15 Risk free interest rate 1.14% – 1.93 % Dividend yield 0.00 % Expected volatility 94% - 115 % Remaining term 2 to 5 years |
Schedule of Fair Value Measured on Recurring Basis | Financial assets and liabilities measured at fair value on a recurring basis are summarized below and disclosed on the balance sheets as follows: Fair Value Measurement Using Carrying Value Level 1 Level 2 Level 3 Total Embedded conversion feature $ 3,298,000 $ - $ - $ 3,298,000 $ 3,298,000 Warrant liability 3,200,137 - - 3,200,137 3,200,137 December 31, 2016 $ 6,498,737 $ - $ - $ 6,498,737 $ 6,498,737 |
Schedule of Fair Value Assets on Recurring Basis | The following table provides a summary of the changes in fair value, including net transfers in and/or out, of all financial assets measured at fair value on a recurring basis using significant unobservable inputs during the year ended December 31, 2016. Warrants Convertible Note Total Balance – December 31, 2015 $ - $ - $ - Issuance of derivative liabilities 5,206,444 2,294,435 7,500,879 Extinguishment of derivative liability from exercise of warrants (2,831,851 ) - (2,831,851 ) Change in fair value of derivative liability 825,544 1,004,165 1,829,709 Balance – December 31, 2016 $ 3,200,137 $ 3,298,000 $ 6,498,737 |
Schedule of Contingent Share Issuance Arrangements, Stock Options and Warrants | The following table shows the outstanding dilutive common shares excluded from the diluted net income (loss) per share calculation as they were anti-dilutive: Contingent shares issuance arrangement, stock options or warrants For the Year Ended December 31, 2016 For the Year Ended December 31, 2015 Convertible note 16,666,667 - Common stock options 5,319,000 9,933,500 Common stock warrants 16,666,667 - Total contingent shares issuance arrangement, stock options or warrants 38,652,334 9,933,500 |
Property and Equipment (Tables)
Property and Equipment (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Property, Plant and Equipment [Abstract] | |
Schedule of Property and Equipment | Property and equipment stated at cost, less accumulated depreciation and amortization, consisted of the following: December 31, 2016 December 31, 2015 Computer Equipment $ 33,858 $ 33,792 Equipment 390,656 343,359 Furniture and Fixtures 45,198 48,950 Leasehold Improvements 22,495 - 492,207 426,101 Less: Accumulated depreciation (276,259 ) (175,315 ) $ 215,948 $ 250,786 |
Investment in CONtv Joint Ven21
Investment in CONtv Joint Venture (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Investment In Contv Joint Venture | |
Schedule of Investment in CONtv | As of December 31, 2016 and 2015, the investment in CONtv was as follows: Investment in CONtv – December 31, 2014 $ 117,507 Investment into CONtv 1,207,220 Loss on CONtv for the year ended December 31, 2015 (1,324,727 ) Investment in CONtv – December 31, 2015 $ - Investment into CONtv 262,500 Loss on CONtv for the year ended December 31, 2016 (262,500 ) Investment in CONtv – December 31, 2016 $ - |
Commitments and Contingencies (
Commitments and Contingencies (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Commitments and Contingencies Disclosure [Abstract] | |
Schedule of Future Minimum Rental Payments for Non-Cancelable Operating Lease | Future minimum lease payments inclusive of related tax required under the non-cancelable operating lease are as follows: Fiscal year ending December 31: 2017 $ 145,800 2018 97,416 2019 97,416 2020 97,416 Thereafter 73,062 $ 511,110 |
Stockholders' Equity (Deficit)
Stockholders' Equity (Deficit) (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Equity [Abstract] | |
Summary of Stock Option Activity | The following is a summary of the Company’s option activity: Options Weighted Average Exercise Price Outstanding – January 1, 2015 9,725,000 $ 0.71 Exercisable – January 1, 2015 1,592,500 $ 0.44 Granted 218,500 $ 0.41 Exercised (10,000 ) $ - Forfeited/Cancelled - $ - Outstanding – December 31, 2015 9,933,500 $ 0.70 Exercisable – December 31, 2015 4,332,500 $ 0.41 Granted 2,000,000 $ 0.55 Exercised - $ - Forfeited/Cancelled (6,614,500 ) $ - Outstanding – December 31, 2016 5,319,000 $ 0.57 Exercisable – December 31, 2016 1,640,500 $ 0.47 |
Schedule of Information Regarding Stock Options Outstanding | Options Outstanding Options Exercisable Exercise Price Number Outstanding Weighted Average Remaining Contractual Life (in years) Weighted Average Exercise Price Number Exercisable Weighted Average Exercise Price $ 0.40 - 1.50 5,319,000 3.24 years $ 0.57 1,640,500 $ 0.47 |
Summary of Stock Warrants Activity | The following is a summary of the Company’s warrant activity: Warrants Weighted Average Exercise Price Outstanding – January 1, 2016 - $ - Exercisable – January 1, 2016 - $ - Granted 33,333,317 $ 0.08 Exercised (16,666,650 ) $ 0.00 Forfeited/Cancelled - $ - Outstanding – December 31, 2016 16,666,667 $ 0.15 Exercisable – December 31, 2016 16,666,667 $ 0.15 |
Schedule of Information Regarding Stock Warrants Outstanding | Warrants Outstanding Warrants Exercisable Exercise Price Number Outstanding Weighted Average Remaining Contractual Life (in years) Weighted Average Exercise Price Number Exercisable Weighted Average Exercise Price $ 0.15 16,666,667 4.92 years $ 0.15 16,666,667 $ 0.15 |
Schedule of Weighted Average Assumptions | The following table summarizes the range of assumptions the Company utilized to estimate the fair value of the options and warrants issued during the year ended December 31, 2016 and 2015: Assumptions December 31, 2016 December 31, 2015 Expected term (years) 2.40-5.00 5.00 Expected volatility 90%-115 % 122 % Risk-free interest rate 0.87% - 1.96 % 1.71 % Dividend yield 0.00 % 0.00 % |
Segment Information (Tables)
Segment Information (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Segment Reporting [Abstract] | |
Schedule of Revenue from Segment Information | The Company evaluates performance of its operating segments based on revenue and operating profit (loss). Segment information for the years ended December 31, 2016 and 2015 and as of December 31, 2016 and 2015, are as follows: Conventions ConBox Total Year ended December 31, 2016 Revenue $ 21,994,433 $ 707,101 $ 22,701,534 Cost of revenue (14,972,190 ) (1,029,898 ) (16,002,088 ) Write-off of obsolete inventory (164,903 ) - (164,903 ) Gross margin 6,857,340 (322,797 ) 6,534,543 Operating expenses (7,627,847 ) (88,942 ) (7,716,789 ) Operating loss (770,507 ) (411,739 ) (1,182,246 ) Year ended December 31, 2015 Revenue $ 22,905,636 $ 1,120,535 $ 24,026,171 Cost of revenue (17,744,611 ) (1,015,420 ) (18,760,031 ) Gross margin 5,161,025 105,115 5,266,140 Operating expenses (8,099,836 ) (48,132 ) (8,147,968 ) Operating profit (loss) (2,938,811 ) 56,983 (2,881,828 ) December 31, 2016 Accounts receivable, net $ 128,561 $ 59,258 $ 187,819 Total assets 5,775,871 59,258 5,835,129 Unearned revenue 1,479,392 95,546 1,574,938 December 31, 2015 Accounts receivable, net $ 108,795 $ 298,347 $ 407,142 Total assets 6,106,772 664,722 6,771,494 Unearned revenue 3,340,837 390,661 3,731,498 |
Income Tax Provision (Tables)
Income Tax Provision (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Income Tax Disclosure [Abstract] | |
Schedule of Deferred Tax Assets | Components of deferred tax assets are as follows: December 31, 2016 December 31, 2015 Net deferred tax assets – Non-current: Expected income tax benefit from NOL carry-forwards $ 1,987,000 $ 993,000 Less valuation allowance (1,987,000 ) (993,000 ) Deferred tax assets, net of valuation allowance $ - $ - |
Schedule of Reconciliation of Federal Statutory Income Tax Rate | A reconciliation of the federal statutory income tax rate and the effective income tax rate as a percentage of income before income taxes is as follows: For the Year Ended December 31, 2016 For the Year Ended December 31, 2015 Federal statutory income tax rate 34.0 % 34.0 % Change in valuation allowance on net operating loss carry-forwards (34.0 %) (34.0 %) Effective income tax rate 0.0 % 0.0 % |
Organization and Operations (De
Organization and Operations (Details Narrative) - shares | Dec. 07, 2010 | Dec. 31, 2016 | Feb. 04, 2016 | Apr. 10, 2015 | Dec. 29, 2014 |
Equity method investment ownership percentage | 50.00% | 50.00% | |||
Percentage of equity interest owned by member of board as non-controlling interest | 50.00% | ||||
Percentage of equity interest and reports remaining | 50.00% | ||||
Wiz Wizard, LLC [Member] | |||||
Percentage of membership interest | 50.00% | ||||
Butta Fyngas [Member] | |||||
Equity method investment ownership percentage | 50.00% | ||||
Percentage of equity interest owned by member of board as non-controlling interest | 50.00% | ||||
Percentage of equity interest and reports remaining | 50.00% | ||||
Share Exchange Agreement [Member] | KTC Corp [Member] | |||||
Stock issued during period shares for acquisitions | 32,927,596 | ||||
Exchange percentage of issued and outstanding shares of KTC Corp | 100.00% | ||||
Percentage of represented shares after consummation of share exchange agreement | 94.90% |
Going Concern Analysis (Details
Going Concern Analysis (Details Narrative) - USD ($) | Dec. 02, 2016 | Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 |
Net loss | $ 8,448,886 | $ 4,234,461 | ||
Derivative liabilities | 6,498,737 | 4,234,461 | ||
Cash and cash equivalents | 4,401,217 | $ 4,723,699 | $ 5,790,724 | |
Working capital | 2,862,317 | |||
Non-cash derivative expenses | $ 6,940,588 | |||
Bristol Investment Fund, Ltd [Member] | Securities Purchase Agreement [Member] | Board of Directors [Member] | ||||
Cash purchase price of securities | $ 2,500,000 | |||
Cash paid | $ 25,000 | |||
Number of common stock shares issued | 500,000 |
Significant and Critical Acco28
Significant and Critical Accounting Policies and Practices (Details Narrative) - USD ($) | Nov. 16, 2015 | Dec. 31, 2016 | Dec. 31, 2015 | Dec. 29, 2014 | Aug. 27, 2014 |
Non-controlling interest | $ (11,817) | $ 17,706 | |||
Allowance for doubtful accounts | $ 0 | 426,532 | |||
Percentage of shares in another entity | 50.00% | 50.00% | |||
Ownership interest in CONtv | 50.00% | ||||
Recognized losses from the venture | $ 262,500 | 1,324,727 | |||
Investment in CONtv | $ 0 | 0 | |||
Class of warrant exercise price | $ 0.15 | ||||
Warrants term | 5 years | ||||
Convertible promisory note net of discount | $ 1,456 | ||||
Acrrued interest | 24,243 | 0 | |||
Shipping and handling costs | 178,931 | 176,986 | |||
A&R [Member} | |||||
Ownership interest in CONtv | 10.00% | ||||
Fund on-going costs | $ 25,000 | ||||
Con Tv LLC [Member] | |||||
Percentage of shares in another entity | 47.50% | ||||
Recognized losses from the venture | $ 262,500 | $ 1,324,727 |
Significant and Critical Acco29
Significant and Critical Accounting Policies and Practices - Schedule of Consolidated Interest in Controlling Entities (Details) | 12 Months Ended | |
Dec. 31, 2016 | Dec. 29, 2014 | |
Attributable interest | 50.00% | |
KTC Corp [Member] | ||
State or other jurisdiction of incorporation or organization | The State of Nevada, U.S.A | |
Date of incorporation or formation (date of acquisition, if applicable) | Sep. 20, 2010 | |
Attributable interest | 100.00% | |
Kicking the Can L.L.C. [Member] | ||
State or other jurisdiction of incorporation or organization | The State of Delaware, U.S.A. | |
Date of incorporation or formation (date of acquisition, if applicable) | Apr. 17, 2009 | |
Attributable interest | 100.00% | |
Wizard World Digital, Inc. [Member] | ||
State or other jurisdiction of incorporation or organization | The State of Nevada, U.S.A. | |
Date of incorporation or formation (date of acquisition, if applicable) | Mar. 18, 2011 | |
Attributable interest | 100.00% | |
Wiz Wizard, LLC [Member] | ||
State or other jurisdiction of incorporation or organization | The State of Delaware, U.S.A. | |
Date of incorporation or formation (date of acquisition, if applicable) | Dec. 29, 2014 | |
Attributable interest | 100.00% | |
ButtaFyngas,LLC [Member] | ||
State or other jurisdiction of incorporation or organization | The State of Delaware, U.S.A. | |
Date of incorporation or formation (date of acquisition, if applicable) | Apr. 10, 2015 | |
Attributable interest | 50.00% |
Significant and Critical Acco30
Significant and Critical Accounting Policies and Practices - Schedule of Inventories (Details) - USD ($) | Dec. 31, 2016 | Dec. 31, 2015 |
Accounting Policies [Abstract] | ||
Finished goods | $ 39,552 |
Significant and Critical Acco31
Significant and Critical Accounting Policies and Practices - Schedule of Estimated Useful Life (Details) | 12 Months Ended | |
Dec. 31, 2016 | ||
Computer Equipment [Member] | ||
Estimated useful lives of property plant, equipment | 3 years | |
Equipment [Member] | Minimum [Member] | ||
Estimated useful lives of property plant, equipment | 2 years | |
Equipment [Member] | Maximum [Member] | ||
Estimated useful lives of property plant, equipment | 5 years | |
Furniture And Fixture [Member] | ||
Estimated useful lives of property plant, equipment | 7 years | |
Leasehold Improvements [Member] | ||
Estimated useful lives of property plant, equipment | 0 years | [1] |
[1] | Amortized on a straight-line basis over the term of the lease or the estimated useful lives, whichever period is shorter. |
Significant and Critical Acco32
Significant and Critical Accounting Policies and Practices - Schedule of Weighted Average Assumptions (Details) | 12 Months Ended |
Dec. 31, 2016$ / shares | |
Dividend yield | 0.00% |
Minimum [Member] | |
Exercise price | $ 0.12 |
Risk free interest rate | 1.14% |
Expected volatility | 94.00% |
Remaining term | 2 years |
Maximum [Member] | |
Exercise price | $ 0.15 |
Risk free interest rate | 1.93% |
Expected volatility | 115.00% |
Remaining term | 5 years |
Significant and Critical Acco33
Significant and Critical Accounting Policies and Practices - Schedule of Fair Value Measured on Recurring Basis (Details) - USD ($) | Dec. 31, 2016 | Dec. 31, 2015 |
Embedded conversion feature | $ 3,298,000 | |
Warrant liability | 3,200,137 | |
Derivative Liabilities | 6,498,737 | $ 4,234,461 |
Carrying Value [Member] | ||
Embedded conversion feature | 3,298,000 | |
Warrant liability | 3,200,137 | |
Derivative Liabilities | 6,498,737 | |
Level 1 [Member] | ||
Embedded conversion feature | ||
Warrant liability | ||
Derivative Liabilities | ||
Level 2 [Member] | ||
Embedded conversion feature | ||
Warrant liability | ||
Derivative Liabilities | ||
Level 3 [Member] | ||
Embedded conversion feature | 3,298,000 | |
Warrant liability | 3,200,137 | |
Derivative Liabilities | $ 6,498,737 |
Significant and Critical Acco34
Significant and Critical Accounting Policies and Practices - Schedule of Fair Value Assets on Recurring Basis (Details) - USD ($) | 12 Months Ended | |
Dec. 31, 2016 | Dec. 31, 2015 | |
Balance at beginning | ||
Issuance of derivative liabilities | 7,500,879 | |
Extinguishment of derivative liability from exercise of warrants | (2,831,851) | |
Change in fair value of derivative liability | 1,829,709 | |
Balance at ending | 6,498,737 | |
Warrants [Member] | ||
Issuance of derivative liabilities | 5,206,444 | |
Extinguishment of derivative liability from exercise of warrants | (2,831,851) | |
Change in fair value of derivative liability | 825,544 | |
Convertible Note [Member] | ||
Balance at beginning | ||
Issuance of derivative liabilities | 2,294,435 | |
Extinguishment of derivative liability from exercise of warrants | ||
Change in fair value of derivative liability | 1,004,165 | |
Balance at ending | $ 3,298,000 |
Significant and Critical Acco35
Significant and Critical Accounting Policies and Practices - Schedule of Contingent Share Issuance Arrangements, Stock Options and Warrants (Details) - shares | 12 Months Ended | |
Dec. 31, 2016 | Dec. 31, 2015 | |
Total contingent share issuance arrangements, stock options and warrants | 38,652,334 | 9,933,500 |
Convertible Note [Member] | ||
Total contingent share issuance arrangements, stock options and warrants | 16,666,667 | |
Stock Options [Member] | ||
Total contingent share issuance arrangements, stock options and warrants | 5,319,000 | 9,933,500 |
Stock Warrant [Member] | ||
Total contingent share issuance arrangements, stock options and warrants | 16,666,667 |
Property and Equipment (Details
Property and Equipment (Details Narrative) - USD ($) | 12 Months Ended | |
Dec. 31, 2016 | Dec. 31, 2015 | |
Property, Plant and Equipment [Abstract] | ||
Depreciation expense | $ 159,101 | $ 119,213 |
Property and Equipment - Schedu
Property and Equipment - Schedule of Property and Equipment (Details) - USD ($) | Dec. 31, 2016 | Dec. 31, 2015 |
Property, Plant and Equipment [Abstract] | ||
Computer Equipment | $ 33,858 | $ 33,792 |
Equipment | 390,656 | 343,359 |
Furniture and Fixtures | 45,198 | 48,950 |
Leasehold Improvements | 22,495 | |
Total | 492,207 | 426,101 |
Less: Accumulated Depreciation | (276,259) | (175,315) |
Property and equipment, net | $ 215,948 | $ 250,786 |
Investment in CONtv Joint Ven38
Investment in CONtv Joint Venture (Details Narrative) - USD ($) | 12 Months Ended | ||||
Dec. 31, 2016 | Dec. 31, 2015 | Nov. 16, 2015 | Dec. 29, 2014 | Aug. 27, 2014 | |
Equity method investment ownership percentage | 50.00% | 50.00% | |||
Loss from venture | $ 262,500 | $ 1,324,727 | |||
Due to contv | 224,241 | 111,741 | |||
A&R Operating Agreement [Member] | |||||
Equity method investment ownership percentage | 10.00% | ||||
Increase of contv | 25,000 | ||||
Con Tv LLC [Member] | |||||
Equity method investment ownership percentage | 47.50% | ||||
Loss from venture | $ 262,500 | $ 1,324,727 |
Investment in CONtv Joint Ven39
Investment in CONtv Joint Venture - Schedule of Investment in CONtv (Details) - USD ($) | 12 Months Ended | |
Dec. 31, 2016 | Dec. 31, 2015 | |
Loss on CONtv | $ (262,500) | $ (1,324,727) |
Con Tv LLC [Member] | ||
Investment in CONtv | 117,507 | |
Investment into CONtv | 262,500 | 1,207,220 |
Loss on CONtv | (262,500) | (1,324,727) |
Investment in CONtv |
Related Party Transactions (Det
Related Party Transactions (Details Narrative) - USD ($) | Dec. 29, 2016 | Dec. 02, 2016 | Jul. 01, 2016 | Dec. 31, 2016 | Dec. 31, 2015 | Feb. 04, 2016 | Dec. 29, 2014 |
Equity method investment ownership percentage | 50.00% | 50.00% | |||||
Stock options granted to purchase of common stock | 2,000,000 | 218,500 | |||||
Consulting expense | $ 687,054 | $ 625,111 | |||||
Security deposit | 19,912 | 21,066 | |||||
Prepaid rent | 181,796 | ||||||
Due to related parties | 224,241 | 111,741 | |||||
Common stock grant fair value to cover legal fees | 2,831,851 | ||||||
Debt discount | $ 2,498,544 | ||||||
Warrant exercise price per share | $ 0.15 | ||||||
Gross proceeds from exercise of warrants | $ 1,667 | ||||||
Derivative expense | 5,110,879 | ||||||
Common Stock [Member] | |||||||
Common stock grant fair value to cover legal fees | |||||||
Series A Warrants [Member] | |||||||
Warrant to purchase shares of common stock | 16,666,667 | ||||||
Warrant exercise price per share | $ 0.15 | ||||||
Warrant expiring date | Dec. 1, 2021 | ||||||
Series B Warrants [Member] | |||||||
Warrant to purchase shares of common stock | 16,666,650 | ||||||
Warrant exercise price per share | $ 0.15 | ||||||
Warrant expiring date | Dec. 1, 2021 | ||||||
Gross proceeds from exercise of warrants | $ 1,667 | ||||||
Debenture [Member] | |||||||
Debt principal amount | $ 2,500,000 | ||||||
Debt instruments maturity date | Dec. 30, 2018 | ||||||
Debt conversion price per share | $ 0.15 | ||||||
Average trading price percentage | 50.00% | ||||||
Debenture [Member] | Common Stock [Member] | |||||||
Debt instrument interest rate per annum | 12.00% | ||||||
Debt conversion price per share | $ 0.15 | ||||||
Wiz Wizard, LLC [Member] | |||||||
Percentage of membership interest | 50.00% | ||||||
Bristol Capital Advisors, LLC [Member] | |||||||
Lease term | 5 years 3 months | ||||||
Monthly lease payment | $ 8,118 | ||||||
Security deposit | 9,137 | ||||||
Prepaid rent | $ 199,238 | ||||||
Rent expense under sublease | $ 24,354 | ||||||
ROAR, LLC [Member] | |||||||
Outsourced marketing expenses | 36,809 | ||||||
Due to related parties | 0 | $ 7,500 | |||||
Bristol Investment Fund, Ltd [Member] | Securities Purchase Agreement [Member] | Board of Directors [Member] | |||||||
Cash purchase price of securities | $ 2,500,000 | ||||||
Cash paid | $ 25,000 | ||||||
Number of common stock shares issued | 500,000 | ||||||
Common stock grant fair value to cover legal fees | $ 85,000 | ||||||
Debt discount | $ 110,000 | ||||||
Wiz Wizard, LLC [Member] | |||||||
Equity method investment ownership percentage | 50.00% | ||||||
Bristol Capital, LLC [Member] | Consulting Services Agreement [Member] | |||||||
Debt monthly fee | $ 18,750 | ||||||
Stock options granted to purchase of common stock | 600,000 | ||||||
Consulting expense | 80,132 | ||||||
Accrued consulting expense | $ 75,000 |
Commitments and Contingencies41
Commitments and Contingencies (Details Narrative) - USD ($) | Dec. 29, 2016 | Jul. 14, 2016 | Jul. 01, 2016 | May 03, 2016 | Nov. 16, 2015 | Jul. 17, 2014 | Dec. 31, 2016 | Dec. 31, 2015 | Apr. 22, 2016 | Dec. 31, 2014 | Dec. 29, 2014 |
Number of option granted | 2,000,000 | 218,500 | |||||||||
Common stock option exercise price | $ 0.55 | $ 0.41 | |||||||||
Number of options purchase to common stock shares | 5,319,000 | 9,933,500 | 9,725,000 | ||||||||
Monthly fee | $ 75,000 | ||||||||||
Sublease period | The term of the Lease is for one year and ten (10) months commencing on September 1, 2014. | ||||||||||
Lease base rent per month | $ 11,132 | ||||||||||
Required initial security deposit | $ 11,466 | ||||||||||
Security deposit | 19,912 | $ 21,066 | |||||||||
Prepaid rent | 181,796 | ||||||||||
Ownership interest in CONtv | 50.00% | ||||||||||
Loss on CONtv joint venture | 262,500 | 1,324,727 | |||||||||
Due to CONtv joint venture | 224,241 | $ 111,741 | |||||||||
A&R [Member} | |||||||||||
Rent expense under sublease | $ 24,354 | ||||||||||
Ownership interest in CONtv | 10.00% | ||||||||||
Fund on-going costs | $ 25,000 | ||||||||||
Arden B. Silverman [Member] | |||||||||||
Due to CONtv joint venture | 42,600 | ||||||||||
Rogers & Cowan [Member] | |||||||||||
Damages sought, value | 90,000 | ||||||||||
Bristol Capital Advisors, LLC [Member] | |||||||||||
Lease term | 5 years 3 months | ||||||||||
Monthly lease payment | $ 8,118 | ||||||||||
Security deposit | 9,137 | ||||||||||
Prepaid rent | $ 199,238 | ||||||||||
Rent expense under sublease | $ 24,354 | ||||||||||
Bristol Capital, LLC [Member] | |||||||||||
Number of options to purchase, vested | (75,000) | ||||||||||
Common stock option exercise price | $ 0.50 | ||||||||||
Number of options purchase to common stock shares | (525,000) | 600,000 | |||||||||
Monthly fee | $ 18,750 | ||||||||||
Consulting Agreement [Member] | Bristol Capital, LLC [Member] | |||||||||||
Common stock option exercise price | $ 0.50 | ||||||||||
Number of options purchase to common stock shares | (75,000) | ||||||||||
March 31, 2017 [Member] | Bristol Capital, LLC [Member] | |||||||||||
Number of options to purchase, vested | (75,000) | ||||||||||
Common stock option exercise price | $ 0.55 | ||||||||||
June 30, 2017 [Member] | Bristol Capital, LLC [Member] | |||||||||||
Number of options to purchase, vested | (75,000) | ||||||||||
Common stock option exercise price | $ 0.55 | ||||||||||
September 30, 2017 [Member] | Bristol Capital, LLC [Member] | |||||||||||
Number of options to purchase, vested | (75,000) | ||||||||||
Common stock option exercise price | $ 0.55 | ||||||||||
December 31, 2017 [Member] | Bristol Capital, LLC [Member] | |||||||||||
Number of options to purchase, vested | (75,000) | ||||||||||
Common stock option exercise price | $ 0.60 | ||||||||||
March 31, 2018 [Member] | Bristol Capital, LLC [Member] | |||||||||||
Number of options to purchase, vested | (75,000) | ||||||||||
Common stock option exercise price | $ 0.60 | ||||||||||
June 30, 2018 [Member] | Bristol Capital, LLC [Member] | |||||||||||
Number of options to purchase, vested | (75,000) | ||||||||||
Common stock option exercise price | $ 0.60 | ||||||||||
Mr.Malinoff [Member] | |||||||||||
Annual base salary | $ 225,000 | ||||||||||
Mr.Malinoff [Member] | March 31, 2017 [Member] | |||||||||||
Number of options to purchase, vested | (75,000) | ||||||||||
Common stock option exercise price | $ 0.55 | ||||||||||
Mr.Malinoff [Member] | June 30, 2017 [Member] | |||||||||||
Number of options to purchase, vested | (75,000) | ||||||||||
Common stock option exercise price | $ 0.55 | ||||||||||
Mr.Malinoff [Member] | September 30, 2017 [Member] | |||||||||||
Number of options to purchase, vested | (75,000) | ||||||||||
Common stock option exercise price | $ 0.55 | ||||||||||
Mr.Malinoff [Member] | December 31, 2017 [Member] | |||||||||||
Number of options to purchase, vested | (75,000) | ||||||||||
Common stock option exercise price | $ 0.60 | ||||||||||
Mr.Malinoff [Member] | March 31, 2018 [Member] | |||||||||||
Number of options to purchase, vested | (75,000) | ||||||||||
Common stock option exercise price | $ 0.60 | ||||||||||
Mr.Malinoff [Member] | June 30, 2018 [Member] | |||||||||||
Number of options to purchase, vested | (75,000) | ||||||||||
Common stock option exercise price | $ 0.60 | ||||||||||
Mr.Malinoff [Member] | November 8, 2016 [Member] | |||||||||||
Number of option granted | 600,000 | ||||||||||
Mr.Malinoff [Member] | December 31, 2016 [Member] | |||||||||||
Number of options to purchase, vested | (75,000) | ||||||||||
Common stock option exercise price | $ 0.50 | ||||||||||
Mr.Malinoff [Member] | December 31, 2016 (1) [Member] | |||||||||||
Number of options to purchase, vested | (75,000) | ||||||||||
Common stock option exercise price | $ 0.50 | ||||||||||
Mr. Maatta [Member] | |||||||||||
Number of options to purchase, vested | 100,000 | ||||||||||
Common stock option exercise price | $ 0.50 | ||||||||||
Number of options purchase to common stock shares | 800,000 | 1,100,000 | |||||||||
Mr. Maatta [Member] | June 30, 2017 [Member] | |||||||||||
Number of options to purchase, vested | 100,000 | ||||||||||
Common stock option exercise price | $ 0.55 | ||||||||||
Mr. Maatta [Member] | Employment Agreement [Member] | |||||||||||
Common stock option exercise price | $ 0.50 | ||||||||||
Number of options purchase to common stock shares | 300,000 | ||||||||||
Mr. Maatta [Member] | March 31, 2017 [Member] | |||||||||||
Number of options to purchase, vested | 100,000 | ||||||||||
Common stock option exercise price | $ 0.55 | ||||||||||
Mr. Maatta [Member] | September 30, 2017 [Member] | |||||||||||
Number of options to purchase, vested | 100,000 | ||||||||||
Common stock option exercise price | $ 0.55 | ||||||||||
Mr. Maatta [Member] | December 31, 2017 [Member] | |||||||||||
Number of options to purchase, vested | 100,000 | ||||||||||
Common stock option exercise price | $ 0.60 | ||||||||||
Mr. Maatta [Member] | March 31, 2018 [Member] | |||||||||||
Number of options to purchase, vested | 100,000 | ||||||||||
Common stock option exercise price | $ 0.60 | ||||||||||
Mr. Maatta [Member] | September 30, 2016 [Member] | |||||||||||
Number of options to purchase, vested | 100,000 | ||||||||||
Common stock option exercise price | $ 0.50 | ||||||||||
Mr. Maatta [Member] | December 31, 2016 [Member] | |||||||||||
Number of options to purchase, vested | 100,000 | ||||||||||
Common stock option exercise price | $ 0.50 |
Commitments and Contingencies -
Commitments and Contingencies - Schedule of Future Minimum Rental Payments for Non-Cancelable Operating Lease (Details) | Dec. 31, 2016USD ($) |
Commitments and Contingencies Disclosure [Abstract] | |
2,017 | $ 145,800 |
2,018 | 97,416 |
2,019 | 97,416 |
2,020 | 97,416 |
Thereafter | 73,062 |
Future minimum lease payments | $ 511,110 |
Stockholders' Equity (Deficit43
Stockholders' Equity (Deficit) (Details Narrative) - USD ($) | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | May 09, 2011 | |
Authorized capital stock | 100,000,000 | ||
Number of common stock authorized | 80,000,000 | 80,000,000 | |
Common stock par value | $ 0.0001 | $ 0.0001 | |
Number of preferred stock authorized | 20,000,000 | 20,000,000 | |
Preferred stock par value | $ 0.0001 | $ 0.0001 | |
Common stock issued | 68,535,036 | 51,368,386 | |
Common stock outstanding | 68,535,036 | 51,368,386 | |
Percentage of fair market value | 100.00% | ||
Percentage of combined voting power | (10.00%) | ||
Percentage of least fair market value | 110.00% | ||
Stock option exercisable term | 5 years | ||
Stock option expiration term | 5 years | ||
Aggregate fair market value of common stock exercisable | $ 100,000 | ||
Intrinsic value of warrants outstanding | 0 | ||
Intrinsic value of warrants exercisable | 0 | ||
Share based compensation expense | $ 777,536 | $ 1,315,869 | |
Unrecognized stock based compensation | 556,648 | ||
2011 Incentive Stock and Award Plan [Member] | |||
Common stock par value | $ .0001 | ||
Plan to issuance of common stock | 15,000,000 | ||
Series A Convertible Preferred Stock [Member] | |||
Preferred stock par value | $ 0.0001 | $ 0.0001 | |
Preferred stock, shares designated | 50,000 | 50,000 |
Stockholders' Equity (Deficit44
Stockholders' Equity (Deficit) - Summary of Stock Option Activity (Details) - $ / shares | 12 Months Ended | |
Dec. 31, 2016 | Dec. 31, 2015 | |
Equity [Abstract] | ||
Number of shares Outstanding at the beginning of the period | 9,933,500 | 9,725,000 |
Number of shares Exercisable at beginning | 4,332,500 | 1,592,500 |
Number of shares Granted | 2,000,000 | 218,500 |
Number of shares Exercised | (10,000) | |
Number of shares Forfeited/Cancelled | (6,614,500) | |
Number of shares Outstanding at the end of the period | 5,319,000 | 9,933,500 |
Number of shares Exercisable at end of the period | 1,640,500 | 4,332,500 |
Weighted Average Exercise Price Outstanding at the beginning of the period | $ 0.70 | $ 0.71 |
Weighted Average Exercise Price Exercisable at the beginning of the period | 0.41 | 0.44 |
Weighted Average Exercise Price Granted | 0.55 | 0.41 |
Weighted Average Exercise Price Exercised | ||
Weighted Average Exercise Price Forfeited/Cancelled | ||
Weighted Average Exercise Price Outstanding at the end of the period | 0.57 | 0.70 |
Weighted Average Exercise Price Exercisable at end of the period | $ 0.47 | $ 0.41 |
Stockholders' Equity (Deficit45
Stockholders' Equity (Deficit) - Schedule of Information Regarding Stock Options Outstanding (Details) | 12 Months Ended |
Dec. 31, 2016$ / sharesshares | |
Equity [Abstract] | |
Range of Exercise Price Lower Limit | $ 0.40 |
Range of Exercise Price Upper limit | $ 1.50 |
Number of Shares Outstanding | shares | 5,319,000 |
Weighted Average Remaining Contractual Life (years) | 3 years 2 months 27 days |
Weighted Average Exercise Price | $ 0.57 |
Number of Shares Exercisable | shares | 1,640,500 |
Weighted Average Exercise Price | $ 0.47 |
Stockholders' Equity (Deficit46
Stockholders' Equity (Deficit) - Summary of Stock Warrants Activity (Details) - Warrant [Member] | 12 Months Ended |
Dec. 31, 2016$ / sharesshares | |
Number of shares Outstanding at the beginning of the period | shares | |
Number of shares Exercisable at beginning | shares | |
Number of shares Granted | shares | 33,333,317 |
Number of shares Exercised | shares | (16,666,650) |
Number of shares Forfeited/Cancelled | shares | |
Number of shares Outstanding at the end of the period | shares | 16,666,667 |
Number of shares Exercisable at end of the period | shares | 16,666,667 |
Weighted Average Exercise Price Outstanding at the beginning of the period | $ / shares | |
Weighted Average Exercise Price Exercisable at the beginning of the period | $ / shares | |
Weighted Average Exercise Price Granted | $ / shares | 0.08 |
Weighted Average Exercise Price Exercised | $ / shares | 0 |
Weighted Average Exercise Price Forfeited/Cancelled | $ / shares | |
Weighted Average Exercise Price Outstanding at the end of the period | $ / shares | 0.15 |
Weighted Average Exercise Price Exercisable at end of the period | $ / shares | $ 0.15 |
Stockholders' Equity (Deficit47
Stockholders' Equity (Deficit) - Schedule of Information Regarding Stock Warrants Outstanding (Details) | 12 Months Ended |
Dec. 31, 2016$ / sharesshares | |
Number of Shares Outstanding | shares | 5,319,000 |
Weighted Average Remaining Contractual Life (years) | 3 years 2 months 27 days |
Weighted Average Exercise Price | $ 0.57 |
Number of Shares Exercisable | shares | 1,640,500 |
Weighted Average Exercise Price | $ 0.47 |
Warrant [Member] | |
Range of Exercise Price | $ 0.15 |
Number of Shares Outstanding | shares | 16,666,667 |
Weighted Average Remaining Contractual Life (years) | 4 years 11 months 1 day |
Weighted Average Exercise Price | $ 0.15 |
Number of Shares Exercisable | shares | 16,666,667 |
Weighted Average Exercise Price | $ 0.15 |
Stockholders' Equity (Deficit48
Stockholders' Equity (Deficit) - Schedule of Weighted Average Assumptions (Details) | 12 Months Ended | |
Dec. 31, 2016 | Dec. 31, 2015 | |
Expected term (years) | 5 years | |
Expected volatility, minimum | 90.00% | |
Expected volatility, maximum | 115.00% | |
Expected volatility | 1.22% | |
Risk-free interest rate, minimum | 0.87% | |
Risk-free interest rate, maximum | 1.96% | |
Risk-free interest rate | 1.71% | |
Dividend yield | 0.00% | 0.00% |
Minimum [Member] | ||
Expected term (years) | 2 years 4 months 24 days | |
Maximum [Member] | ||
Expected term (years) | 5 years |
Segment Information - Schedule
Segment Information - Schedule of Revenue from Segment Information (Details) - USD ($) | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 30, 2015 | |
Revenue | $ 22,701,534 | $ 24,026,171 | |
Cost of revenue | (16,002,088) | (18,760,031) | |
Write-off of obsolete inventory | (164,903) | ||
Gross margin | 6,534,543 | 5,266,140 | |
Operating expenses | (7,716,789) | (8,147,968) | |
Operating loss | (1,182,246) | (2,881,828) | |
Accounts receivable, net | 187,819 | 407,142 | |
Total assets | 5,835,129 | 6,771,494 | |
Unearned revenue | 1,574,938 | 3,731,498 | |
Conventions [Member] | |||
Revenue | 21,994,433 | 22,905,636 | |
Cost of revenue | (14,972,190) | (17,744,611) | |
Write-off of obsolete inventory | (164,903) | ||
Gross margin | 6,857,340 | 5,161,025 | |
Operating expenses | (7,627,847) | (8,099,836) | |
Operating loss | (770,507) | (2,938,811) | |
Accounts receivable, net | 128,561 | 108,795 | |
Total assets | 5,775,871 | 6,106,772 | |
Unearned revenue | 1,479,392 | 3,340,837 | |
ConBox [Member] | |||
Revenue | 707,101 | 1,120,535 | |
Cost of revenue | (1,029,898) | (1,015,420) | |
Write-off of obsolete inventory | |||
Gross margin | (322,797) | 105,115 | |
Operating expenses | (88,942) | (48,132) | |
Operating loss | (411,739) | $ 56,983 | |
Accounts receivable, net | 59,258 | $ 298,347 | |
Total assets | 59,258 | 664,722 | |
Unearned revenue | $ 95,546 | $ 390,661 |
Income Tax Provision (Details N
Income Tax Provision (Details Narrative) - USD ($) | 12 Months Ended | |
Dec. 31, 2016 | Dec. 31, 2015 | |
Income Tax Disclosure [Abstract] | ||
Net operating loss carry-forwards | $ 9,504,000 | |
Future taxable income expiration date | Dec. 31, 2036 | |
Net deferred tax assets | $ 3,231,000 | |
Net loss carry-forwards valuation allowance | 3,231,000 | |
Deferred tax assets increase in valuation allowance | 1,987,000 | $ 984,000 |
Unpaid tax on interest or penalties | ||
Unrecognized tax benefit |
Income Tax Provision - Schedule
Income Tax Provision - Schedule of Deferred Tax Assets (Details) - USD ($) | Dec. 31, 2016 | Dec. 31, 2015 |
Income Tax Disclosure [Abstract] | ||
Expected income tax benefit from NOL carry-forwards | $ 1,987,000 | $ 993,000 |
Less valuation allowance | (1,987,000) | (993,000) |
Deferred tax assets, net of valuation allowance |
Income Tax Provision - Schedu52
Income Tax Provision - Schedule of Reconciliation of Federal Statutory Income Tax Rate (Details) | 12 Months Ended | |
Dec. 31, 2016 | Dec. 31, 2015 | |
Income Tax Disclosure [Abstract] | ||
Federal statutory income tax rate | 34.00% | 34.00% |
Change in valuation allowance on net operating loss carry-forwards | (34.00%) | (34.00%) |
Effective income tax rate | 0.00% | 0.00% |