Equator Beverage (MOJO) 10-Q 2 May 16 2016 Q1 Quarterly report Financial data

Document and Entity Information

Document and Entity Information - shares	3 Months Ended
	Mar. 31, 2016	Apr. 29, 2016
Document And Entity Information
Entity Registrant Name	Mojo Organics, Inc.
Entity Central Index Key	1,414,953
Document Type	10-Q
Document Period End Date	Mar. 31, 2016
Amendment Flag	false
Current Fiscal Year End Date	--12-31
Is Entity a Well-known Seasoned Issuer?	No
Is Entity a Voluntary Filer?	No
Is Entity's Reporting Status Current?	Yes
Entity Filer Category	Smaller Reporting Company
Entity Common Stock, Shares Outstanding		18,273,873
Document Fiscal Period Focus	Q1
Document Fiscal Year Focus	2,016

Condensed Balance Sheets (Unaud

Condensed Balance Sheets (Unaudited) - USD ($)	Mar. 31, 2016	Dec. 31, 2015
Current Assets
Cash and cash equivalents	$ 54,207	$ 15,442
Accounts Receivable, net	220,491	6,636
Prepaid expenses	3,204	10,350
Inventory	93,172	33,473
Supplier deposits	52,254	33,835
Total Current Assets	423,328	99,736
Property and Equipment, net of accumulated depreciation	1,627	1,811
Other Assets
Security deposit	2,778	2,778
Total Assets	427,733	104,325
Current Liabilities
Accounts payable and accrued expenses	$ 40,956	16,730
Accrued payroll to related parties		3,050
Total Current Liabilities	$ 40,956	$ 19,780
Stockholders Equity/ (Deficit)
Preferred stock, 10,000,000 shares authorized at $0.001 par value, no shares issued and outstanding.
Common stock, 190,000,000 shares authorized at $0.001 par value, 18,273,876 and 17,309,590 shares issued and outstanding, at March 31, 2016 and December 31, 2015, respectively	$ 18,274	$ 17,309
Additional paid in capital	20,874,918	20,192,089
Accumulated deficit	(20,506,415)	(20,124,853)
Total Stockholders Equity/ Deficit	386,777	84,545
Total Liabilities and Stockholders Equity/ Deficit	$ 427,733	$ 104,325

Condensed Balance Sheets (Paren

Condensed Balance Sheets (Parenthetical) - $ / shares	Mar. 31, 2016	Dec. 31, 2015
Statement of Financial Position [Abstract]
Preferred stock, par value	$ 0.001	$ 0.001
Preferred stock, authorized	10,000,000	10,000,000
Preferred stock, issued	0	0
Preferred stock, outstanding	0	0
Common stock, par value	$ 0.001	$ 0.001
Common stock, authorized	190,000,000	190,000,000
Common stock, issued	18,273,876	17,309,590
Common stock, outstanding	18,273,876	17,309,590

Condensed Statements of Operati

Condensed Statements of Operations (Unaudited) (Restated) - USD ($)	3 Months Ended
	Mar. 31, 2016	Mar. 31, 2015
Income Statement [Abstract]
Revenues	$ 250,712	$ 68,885
Cost of Revenues	146,134	338,166
Gross Profit (Loss)	104,578	(269,281)
Operating Expenses
Selling, general and administrative	$ 486,140	619,944
License fee		1,775,862
Total Operating Expenses	$ 486,140	2,395,806
Loss from Operations	$ (381,562)	(2,665,087)
Total Other Expense		(6,597)
Loss Before Provision for Income Taxes	$ (381,562)	$ (2,671,684)
Provision for Income Taxes
Net Loss	$ (381,562)	$ (2,671,684)
Net loss per common share, basic and fully diluted	$ (0.02)	$ (0.16)
Basic and diluted weighted average number of common shares outstanding	17,889,257	16,907,396

Condensed Statements of Cash Fl

Condensed Statements of Cash Flows (Unaudited) - USD ($)	3 Months Ended		12 Months Ended
	Mar. 31, 2016	Mar. 31, 2015	Dec. 31, 2015
Cash flows from operating activities
Net Loss	$ (381,562)	$ (2,671,684)	$ (417,223)
Adjustments to reconcile net loss to cash used by operating activitites:
Depreciation	$ 184	664
License fee		$ 1,775,862
Accrued payroll to related parties converted to additonal paid-in capital	$ 95,500
Stock-based compensation - stock options	18,810	$ 19,165
Stock and warrants issued to directors and employees	231,984	374,978
Change in assets and liabilites:
Decrease (increase) in accounts receivable	(213,855)	7,332
Decrease (increase) in inventory	(59,699)	252,436
Decrease (increase) in supplier deposits	(18,419)	1,782
Decrease in prepaid expenses	7,146	28,092
Increase (decrease) in accounts payable and accrued expenses	24,226	(9,839)
Increase (decrease) in accrued payroll to related parties	(3,050)	34,855
Net cash used in operating activities	(298,735)	$ (186,357)
Net cash from financing activities:
Sale of common stock, net	337,500
Net cash provided by financing activities	337,500
Net increase (decrease) in cash and cash equivalents	38,765	$ (186,357)
Cash and cash equivalents at beginning of period	15,442	345,616	345,616
Cash and cash equivalents at end of period	$ 54,207	$ 159,259	$ 15,442
SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION:
Interest paid
Taxes paid

Condensed Statements of Changes

Condensed Statements of Changes in Stockholders' Equity (Unaudited) - 3 months ended Mar. 31, 2016 - USD ($)	Common Stock	Additional Paid-In Capital	Accumulated Deficit	Total
Beginning balance, Shares at Dec. 31, 2015	17,309,590
Beginning balance, Amount at Dec. 31, 2015	$ 17,309	$ 20,192,089	$ (20,124,853)	$ 84,545
Issuance of restricted Common Stock and Warrants:
Private Placement, Shares	964,286
Private Placement, Amount	$ 965	336,535		337,500
Stock based compensation
Stock options		18,810		18,810
Restricted Common Stock vesting		231,984		231,984
Accrued payroll to related parties - forgiven		$ 95,500		95,500
Net loss			$ (381,562)	(381,562)
Ending balance, Shares at Mar. 31, 2016	18,273,876
Ending balance, Amount at Mar. 31, 2016	$ 18,274	$ 20,874,918	$ (20,506,415)	$ 386,777

Business

Business	3 Months Ended
	Mar. 31, 2016
Accounting Policies [Abstract]
Business and Basis of Presentation	NOTE 1 – BUSINESS Overview MOJO Organics, Inc. (“MOJO” or the “Company”) was incorporated in the State of Delaware on August 2, 2007. Headquartered in Jersey City, NJ, the Company develops emerging beverage brands that are natural, USDA Organic and Non GMO Project verified. Beginning in December 2015, the Company began selling its line of coconut water beverages. Previously, the Company produced 100% tropical fruit juices under a license branding agreement (the “License Agreement”). The License Agreement was terminated effective September 27, 2015. See Note 5 in the Notes to the Condensed Financial Statements. Interim Financial Statements The accompanying unaudited interim condensed financial statements have been prepared pursuant to the rules and regulations for reporting on Form 10-Q and article 10 of Regulation S-X and the related rules and regulations of the Securities and Exchange Commission (“SEC”). Accordingly, certain information and disclosures required by accounting principles generally accepted in the United States of America (“GAAP”) for complete financial statements have been condensed or omitted pursuant to such rules and regulations. However, the Company believes that the disclosures included in these financial statements are adequate to make the information presented not misleading. The unaudited interim condensed financial statements included in this document have been prepared on the same basis as the annual audited financial statements, and in the Company’s opinion, reflect all adjustments necessary for a fair presentation in accordance with GAAP and SEC regulations for interim financial statements. The results for the three months ended March 31, 2016 are not necessarily indicative of the results that the Company will have for any subsequent period. These unaudited condensed financial statements should be read in conjunction with the audited financial statements and the notes to those statements for the year ended December 31, 2015 included in the Company’s Annual Report on Form 10-K.

Summary of Significant Accounti

Summary of Significant Accounting Policies	3 Months Ended
	Mar. 31, 2016
Accounting Policies [Abstract]
Summary of Significant Accounting Policies	NOTE 2 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Use of Estimates The financial statements are prepared in conformity with GAAP. Management is required to make estimates and assumptions that affect the reported amounts of assets and liabilities at the date of the financial statements and the reported amounts of revenue and expenses during the reporting period. Actual results could differ from those estimates. Cash and Cash Equivalents Cash equivalents include investment instruments and time deposits purchased with a maturity of three months or less. Accounts Receivable Accounts receivable are stated at the amount management expects to collect from outstanding balances. The Company provides for probable uncollectible amounts based upon its assessment of the current status of the individual receivables and after using reasonable collection efforts. The allowance for doubtful accounts as of March 31, 2016 and December 31, 2015 was zero and $3,000, respectively. Inventories Inventories are stated at the lower of cost (first-in, first-out method) or market. When necessary, the Company provides allowances to adjust the carrying value of its inventories to the lower of cost or net realizable value. Supplier Deposits Supplier Deposits consist of payments to manufacturers for future production. Property and Equipment and Depreciation Property and equipment are stated at cost. Depreciation is computed using the straight line method over the estimated useful life of the respective assets. Computer equipment is depreciated over a period of 3 to 5 years. Computer Software is depreciated over a one year period. Maintenance and repairs are charged to expense when incurred. When property and equipment are retired or otherwise disposed of, the related cost and accumulated depreciation are removed from the respective accounts and any gain or loss is credited or charged to income. At March 31, 2016 and December 31, 2015, accumulated depreciation related to property and equipment was $1,119 and $935, respectively. Revenue Recognition Revenue from the sale of products is recognized when persuasive evidence of an arrangement exists, delivery of products has occurred, the sales price is fixed or determinable and collectability is reasonably assured. Deductions from Revenue Costs incurred for sales incentives and discounts are accounted for as a reduction in revenue. These costs include payments to customers for performing merchandising activities on our behalf, including in-store displays, promotions for new items and obtaining optimum shelf space. Shipping and Handling Costs Shipping and Handling Costs incurred to move finished goods from our sales distribution centers to customer locations are included in the line Selling, General and Administrative Expenses in our Statements of Operations. Net Loss Per Common Share The Company computes per share amounts in accordance with the Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) Topic 260, “ Earnings per Share The following potentially dilutive securities have been excluded from the computation of weighted average shares outstanding for the three months ended March 31, 2016 and 2015, as they would have had an anti-dilutive impact on the Company’s net loss per common share: 2016 2015 Shares underlying options outstanding 620,000 830,000 Shares underlying warrants outstanding 3,096,919 1,114,776 Total 3,716,919 1,944,776 Start-Up Costs In accordance with ASC topic 720-15, “ Start-Up Costs Income Taxes The Company provides for income taxes under ASC topic 740, “ Income Taxes The Company recognizes interest and/or penalties related to income tax matters in income tax expense. As of March 31, 2016 and December 31, 2015, the Company had no accrued interest or penalties. The Company has had no Federal or state tax examinations in the past nor does it have any at the current time. Stock-Based Compensation ASC Topic 718, “ Accounting for Stock-Based Compensation The Company accounts for equity based transactions with non-employees under the provisions of ASC Subtopic 505-50, “ Equity-Based Payments to Non-Employees Fair value of financial instruments The carrying amounts of financial instruments, which include cash, accounts receivable, accounts payable, accrued expenses and debt obligations approximate their fair values due to their short-term nature and/or variable interest rates. The Company’s debt obligations bear interest at rates which approximate prevailing market rates for instruments with similar characteristics and, accordingly, the carrying values for these instruments approximate fair value. The Company adopted ASC Topic 820, “ Fair Value Measurement • Level 1 Unadjusted quoted prices in active markets that are accessible at the measurement date for identical,, unrestricted assets or liabilities; • Level 2 Quoted prices in markets that are not active, or inputs that are observable, either directly or indirectly, for substantially the full term of the asset or liability; • Level 3 Prices or valuation techniques that require inputs that are both significant to the fair value measurement and unobservable (supported by little or no market activity). The Company did not have any assets or liabilities measured at fair value on a recurring basis at March 31, 2016 or December 31, 2015. The Company did not have any fair value adjustments for assets and liabilities measured at fair value on a nonrecurring basis during the three months ended March 31, 2016 or 2015. New Accounting Pronouncements In May 2014, FASB issued Accounting Standards Update (“ASU”) No. 2014-09, which creates ASC Topic 606, “ Revenue from Contracts with Customers” Revenue Recognition” Revenue Recognition—Construction-Type and Production-Type Contracts Other Assets and Deferred Costs—Contracts with Customers In August 2014, FASB issued ASU 2014-15, “ Presentation of Financial Statements Going Concern Disclosure of Uncertainties about an Entity’s Ability to Continue as a Going Concern Specifically, the amendments (1) provide a definition of the term substantial doubt, management’s plans, (4) require certain disclosures when substantial doubt is alleviated as a result of consideration of management’s plans, (5) require an express statement and other disclosures when substantial doubt is not alleviated, and (6) require an assessment for a period of one year after the date that the financial statements are issued (or available to be issued). The amendments in this ASU are effective for public and nonpublic entities for annual periods ending after December 15, 2016. Early adoption is permitted. The Company adopted SU 2014-15 during the three months ended March 31, 2016. Management does not believe that any other recently issued, but not yet effective accounting standards, if currently adopted, would have a material effect on the accompanying financial statements. Reclassifications Certain amounts in the March 31, 2015 Financial Statements have been reclassified to conform to the presentation used in the March 31, 2016 Financial Statements.

Alleviation of Going Concern Qu

Alleviation of Going Concern Qualification	3 Months Ended
	Mar. 31, 2016
Organization, Consolidation and Presentation of Financial Statements [Abstract]
Alleviation of Going Concern Qualification	NOTE 3 – ALLEVIATION OF GOING CONCERN QUALIFICATION We have incurred net operating losses since our inception. The expansion and development of our business has been funded primarily through private equity. During the three months ended March 31, 2016, the Company raised $337,500 in a private placement (see Note 6 for further information). As of March 31, 2016, the Company had working capital of $382,372. The Company has received purchase orders to be fulfilled from both new customers and existing customers. As a result, the Company believes it has sufficient cash and revenue commitments to finance its operations over the next twelve month period. There is no assurance that the income generated from these and future purchase orders will meet our working capital requirements subsequent to the next twelve months. We continue to market our products in accordance with our business plan. There can be no assurances, however, that we will be successful in our efforts to generate sufficient revenues through our marketing efforts.

Inventory

Inventory	3 Months Ended
	Mar. 31, 2016
Inventory Disclosure [Abstract]
Inventory	NOTE 4 – INVENTORY As of March 31, 2016 and December 31, 2015, inventory consisted of finished goods of $93,172 and $33,473, respectively.

Commitments and Contingencies

Commitments and Contingencies	3 Months Ended
	Mar. 31, 2016
Commitments and Contingencies
Commitments and Contingencies	NOTE 5 – COMMITMENTS AND CONTINGENCIES Employment Agreements On June 15, 2015, the Company entered into an Amended and Restated Employment Agreement (the "Simpson Agreement") with Glenn Simpson pursuant to which Mr. Simpson will continue to act as the Company's CEO and Chairman for a term of five (5) years as extended in consideration of (i) a base salary of $5,000 per month from June 2015 through September 2015 and then increasing to $18,500 per month, (ii) 1,544,737 shares of common stock of the Company to be issued to Mr. Simpson upon the Company generating revenue of $3,000,000 during any consecutive twelve month period during the term (the “Simpson Shares”) and (iii) an annual bonus comprised of cash and Common Stock based on performance goals established by the Board of Directors of the Company as set forth in the Simpson Agreement. The cash bonus is established at 20% of the annual salary. The stock bonus is set at 200,000 shares of Common Stock per year through December 31, 2021 based upon revenue performance goals. The revenue goals range from $900,000 to $19,200,000 per year. The bonus awards may be accelerated should revenue exceed the annual target amounts. On December 15, 2015, the Company and Mr. Simpson entered into an amendment to the Simpson Agreement increasing the Simpson Shares by 337,500. On June 15, 2015, the Company entered into an Amended and Restated Employment Agreement (the "Spinner Agreement") with Peter Spinner pursuant to which Mr. Spinner will continue to act as the Company's COO for a term of five (5) years as extended in consideration of (i) a base salary of $8,000 per month from June 2015 through September 2015 and then increasing to $16,000 per month, (ii) 252,632 shares of common stock of the Company to be issued to Mr. Spinner upon the Company generating revenue of $3,000,000 during any consecutive twelve month period during the term (the “Spinner Shares”) and (iii) an annual bonus comprised of cash and Common Stock based on performance goals established by the Board of Directors of the Company as set forth in the Spinner Agreement. The cash bonus is established at 20% of the annual salary. The stock bonus is set at 375,000 shares of Common Stock per year through December 31, 2018 and 200,000 shares of Common Stock per year from 2019 through December 31, 2021 based upon revenue performance goals. The revenue goals range from $900,000 to $19,200,000 per year. The bonus awards may be accelerated should revenue exceed the annual target amounts. On December 15, 2015, the Company and Mr. Spinner entered into an amendment to the Spinner Agreement increasing the number of Spinner Shares by 345,000. Lease Commitment The Company maintains office space in Jersey City, New Jersey. The Company leases the space from a third-party pursuant to a lease agreement dated May 1, 2015 at a rate of $1,389 per month. This agreement will terminate on April 30, 2016. The Company will continue to maintain its office space on a month to month basis. Lease expense amounted to $5,389 and $4,820 for the three months ended March 31, 2016 and 2015, respectively. Licensing Agreement On March 27, 2015, pursuant to the terms of the License Agreement, the Company was provided with written notice of termination effective September 27, 2015. The notice demanded payment by the Company of $2,283,085, comprised of liquidated damages amounting to $1,515,076 and outstanding royalties of $768,009. On May 29, 2015, the liquidating damages and outstanding royalties were settled for $90,000. As a result, the Company reversed the license fees recorded during the three months ended March 31, 2015 of $1,775,862 and recorded net income amounting to $417,223 for the year ended December 31, 2015.

Stockholders' Equity

Stockholders' Equity	3 Months Ended
	Mar. 31, 2016
Stockholders' Equity Note [Abstract]
Stockholders' Equity Note Disclosure [Text Block]	NOTE 6 – STOCKHOLDERS’ EQUITY The Company has authorized 190,000,000 shares of common stock (“Common Stock”) and 10,000,000 shares of preferred stock (“Preferred Stock”), each having a par value of $0.001. In October 2015, the Company approved the 2015 Incentive Stock Plan, which provides the Company with the ability to issue stock options, stock awards and/or restricted stock purchase offers for up to an aggregate of 1,500,000 shares of Common Stock. In March 2013, the Company approved the 2012 Long-Term Incentive Equity Plan (the “2012 Plan”), which provides the Company with the ability to issue stock options, stock appreciation rights, restricted stock and/or stock based awards for up to an aggregate of 2,050,000 shares of Common Stock. Private Placement Offerings On January 20, 2016, the Company approved a subscription agreement (the “2016 Subscription”) whereby 1,428,572 shares of Common Stock were offered to accredited investors for $0.35 per share. For every two shares purchased, the investor received a warrant to acquire one share of Common Stock at an exercise price of $0.70 per share exercisable for a period of two years from the date of issuance representing a potential aggregate of 714,286 shares of Common Stock. As of March 31, 2016, the Company issued a total of 964,286 shares of Common Stock and two year purchase warrants to acquire a total 482,143 shares of Common Stock to four accredited investors in consideration of $337,500. In August 2015, the Company entered into a subscription agreement (the “2015 Subscription”) whereby 750,000 shares of Common Stock were sold to an accredited investor for a total of $150,000, along with a purchase warrant for 1,500,000 shares of Common Stock at a price of $0.40 per share. The five year warrant is immediately exercisable. Restricted Stock Compensation The Company issued shares of restricted Common Stock to certain of its directors, executive officers and employees. Unvested restricted shares are subject to forfeiture. With the exception of 1,726,485 shares issued to employees and directors and 582,626 shares issued to a former director, which vest based upon achieving certain milestones, the Company records compensation expense over the vesting period based upon the fair market value on the date of grant for each share, adjusted for forfeitures. In December 2015, the Company entered into a settlement with a former director of the Company whereby restricted Common Stock amounting to 1,165,251 shares was cancelled. The former director was issued 582,626 shares of restricted Common Stock subject to a lock up legend providing that the Company generate certain minimum revenues and providing for limitations on the amount of Common Stock that the former director can sell per quarter. In June 2015, the Company awarded 2,023,854 shares of Common Stock to its officers and employees. The Company issued 226,485 shares in August 2015, which shares will vest upon the Company reaching a $3,000,000 revenue threshold during any twelve month period. The balance of 1,797,369 shares will be issued and will vest upon the Company reaching a $3,000,000 revenue threshold during any twelve month period. In December 2015, the Company awarded 682,500 shares of Common Stock to its officers and employees. These shares will be issued and will vest upon the Company reaching a $3,000,000 revenue threshold during any twelve month period. See Note 5 to the Notes to the Condensed Financial Statements. A summary of the restricted stock issuances to directors, executive officers and employees is as follows: Number of Shares Weighted Average Grant Date Fair Value Unvested share balance, January 1, 2015 6,091,992 $ 1.07 Granted 809,111 0.34 Vested (1,525,546 ) 1.32 Forfeited (1,165,251 ) 1.40 Unvested share balance, December 31, 2015 4,210,306 $ 0.75 Granted — — Vested (950,596 ) 1.33 Forfeited — — Unvested share balance, March 31, 2016 3,259,710 $ 0.54 In connection with the issuance of restricted stock, the Company recorded share-based compensation expense of $231,984 and $374,978 for the three months ended March 31, 2016 and 2015, respectively. As of March 31, 2016, there was $950,596 of total unrecognized compensation cost, net of estimated forfeitures, related to unvested share-based compensation. As of March 31, 2016, there was $490,426 of unrecognized compensation expense related to unvested share-based compensation which vests only upon the achievement of certain performance criteria. Stock Warrants In connection with the 2016 Subscription, warrants to purchase 482,143 shares of Common Stock were issued at a price of $0.70 per share and are exercisable for a period of two years from the date of issuance. Warrants to purchase 1,500,000 shares of Common Stock were issued as part of the 2015 Subscription at a price of $0.40 per share. The warrants are exercisable for five years from the date of issuance. The following table summarizes warrant activity during the period: Number of Warrants Outstanding at January 1, 2015 1,114,776 Issued in connection with the 2015 Subscription 1,500,000 Outstanding at December 31, 2015 2,614,776 Issued in connection with the 2016 Subscription 482,143 Outstanding at March 31, 2016 3,096,919 Exercisable at March 31, 2016 3,096,919 Advisory Services On October 3, 2013, the Company entered into an agreement with Ian Thompson for strategic business advisory services, public relations services and investor relations services. In connection with this agreement, the Company issued 167,204 shares of restricted Common Stock to Ian Thompson and recorded consulting fees of $501,612 in 2013, which was the fair market value of the stock on the date of issue. The stock is restricted from trading. Ian Thompson was also issued 200,000 shares of restricted Common Stock for future services that included, but not limited to strategic business advisory services, public relations services and investor relations services which was to vest in mid-2014. Consulting fees of $105,000 and $280,000 were recorded in 2014 and 2013, respectively, related to the 200,000 shares of Common Stock issued to Ian Thompson. During the term of the agreement, the Company requested Ian Thompson to render performance under the agreement and to provide evidence of same. Ian Thompson failed to perform in all material respects under the terms of the agreement and failed to provide evidence. On June 27, 2014, by a unanimous written consent of the board of directors, the Company terminated the agreement and authorized the cancellation of the 367,204 shares, due to lack of delivery of consideration and material breach of the agreement.

Stock Options

Stock Options	3 Months Ended
	Mar. 31, 2016
Other Liabilities Disclosure [Abstract]
Stock Options	NOTE 7 – STOCK OPTIONS In June 2015, the Company granted a director of the Company stock options to purchase 35,000 shares of Common Stock pursuant to the 2012 Plan. The exercise price is $0.255 per share and the options become exercisable in four equal tranches in December 2015, June 2016, December 2016 and June 2017. They expire in June 2020. During the three months ended March 31, 2016 and 2015, compensation expense related to stock options of $18,809 and $19,165, respectively, was recorded. As of March 31, 2016, there was $27,618 of total unrecognized compensation cost related to non-vested stock options. That remaining cost is expected to be recognized in 2016 and 2017 in conjunction with the applicable vesting periods.

Related Party Transactions

Related Party Transactions	3 Months Ended
	Mar. 31, 2016
Related Party Transactions [Abstract]
Related Party Transactions	NOTE 8 – RELATED PARTY TRANSACTIONS During the three months ended March 31, 2016, the Chief Executive Officer (the “CEO) and the Chief Operating Officer (the “COO”) of the Company forgave unpaid salary due to them of $51,500 and $44,000, respectively. This resulted in an increase to additional paid in capital of $95,500 for the three months ended March 31, 2016. In January 2016, the Company entered into the 2016 Subscription with Wyatts Torch Equity Partners, LP (“Wyatt”) for the sale of 285,714 shares of Common Stock for $100,000 and warrants to purchase 142,857 shares of Common Stock at $0.70 per share. The managing member of Wyatt is the COO of the Company, as well as a Director of the Company. See Note 6 for further discussion. As of December 31, 2015, accrued payroll of $3,050 was payable to the CEO, the COO and Controller (and Principal Accounting Officer) of the Company. There was no accrued payroll as of March 31, 2016. In August 2015, the Company issued its Controller 226,485 shares of Common Stock of the Company in consideration of her previous and continued services as Controller of the Company. These shares will vest upon the Company generating revenue of $3,000,000 during any consecutive twelve month period on or prior to June 26, 2025. Also in August 2015, the Company entered into the 2015 Subscription with Wyatt for the sale of 750,000 shares of Common Stock for $150,000 and warrants to purchase 1,500,000 shares of Common Stock at $0.40 per share. See Note 6 for further discussion.

Summary of Significant Accoun15

Summary of Significant Accounting Policies (Policies)	3 Months Ended
	Mar. 31, 2016
Accounting Policies [Abstract]
Use of Estimates	Use of Estimates The financial statements are prepared in conformity with GAAP. Management is required to make estimates and assumptions that affect the reported amounts of assets and liabilities at the date of the financial statements and the reported amounts of revenue and expenses during the reporting period. Actual results could differ from those estimates.
Cash and Cash Equivalents	Cash and Cash Equivalents Cash equivalents include investment instruments and time deposits purchased with a maturity of three months or less.
Accounts Receivable	Accounts Receivable Accounts receivable are stated at the amount management expects to collect from outstanding balances. The Company provides for probable uncollectible amounts based upon its assessment of the current status of the individual receivables and after using reasonable collection efforts. The allowance for doubtful accounts as of March 31, 2016 and December 31, 2015 was zero and $3,000, respectively.
Inventories	Inventories Inventories are stated at the lower of cost (first-in, first-out method) or market. When necessary, the Company provides allowances to adjust the carrying value of its inventories to the lower of cost or net realizable value.
Supplier Deposits	Supplier Deposits Supplier Deposits consist of payments to manufacturers for future production.
Property and Equipment and Depreciation	Property and Equipment and Depreciation Property and equipment are stated at cost. Depreciation is computed using the straight line method over the estimated useful life of the respective assets. Computer equipment is depreciated over a period of 3 to 5 years. Computer Software is depreciated over a one year period. Maintenance and repairs are charged to expense when incurred. When property and equipment are retired or otherwise disposed of, the related cost and accumulated depreciation are removed from the respective accounts and any gain or loss is credited or charged to income. At March 31, 2016 and December 31, 2015, accumulated depreciation related to property and equipment was $1,119 and $935, respectively.
Revenue Recognition	Revenue Recognition Revenue from the sale of products is recognized when persuasive evidence of an arrangement exists, delivery of products has occurred, the sales price is fixed or determinable and collectability is reasonably assured.
Deductions from Revenue	Deductions from Revenue Costs incurred for sales incentives and discounts are accounted for as a reduction in revenue. These costs include payments to customers for performing merchandising activities on our behalf, including in-store displays, promotions for new items and obtaining optimum shelf space.
Shipping and Handling Costs	Shipping and Handling Costs Shipping and Handling Costs incurred to move finished goods from our sales distribution centers to customer locations are included in the line Selling, General and Administrative Expenses in our Statements of Operations.
Net Loss Per Common Share	Net Loss Per Common Share The Company computes per share amounts in accordance with the Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) Topic 260, “ Earnings per Share The following potentially dilutive securities have been excluded from the computation of weighted average shares outstanding for the three months ended March 31, 2016 and 2015, as they would have had an anti-dilutive impact on the Company’s net loss per common share: 2016 2015 Shares underlying options outstanding 620,000 830,000 Shares underlying warrants outstanding 3,096,919 1,114,776 Total 3,716,919 1,944,776
Start-Up Costs	Start-Up Costs In accordance with ASC topic 720-15, “ Start-Up Costs
Income Taxes	Income Taxes The Company provides for income taxes under ASC topic 740, “ Income Taxes The Company recognizes interest and/or penalties related to income tax matters in income tax expense. As of March 31, 2016 and December 31, 2015, the Company had no accrued interest or penalties. The Company has had no Federal or state tax examinations in the past nor does it have any at the current time.
Stock-Based Compensation	Stock-Based Compensation ASC Topic 718, “ Accounting for Stock-Based Compensation The Company accounts for equity based transactions with non-employees under the provisions of ASC Subtopic 505-50, “ Equity-Based Payments to Non-Employees
Fair value of financial instruments	Fair value of financial instruments The carrying amounts of financial instruments, which include cash, accounts receivable, accounts payable, accrued expenses and debt obligations approximate their fair values due to their short-term nature and/or variable interest rates. The Company’s debt obligations bear interest at rates which approximate prevailing market rates for instruments with similar characteristics and, accordingly, the carrying values for these instruments approximate fair value. The Company adopted ASC Topic 820, “ Fair Value Measurement • Level 1 Unadjusted quoted prices in active markets that are accessible at the measurement date for identical,, unrestricted assets or liabilities; • Level 2 Quoted prices in markets that are not active, or inputs that are observable, either directly or indirectly, for substantially the full term of the asset or liability; • Level 3 Prices or valuation techniques that require inputs that are both significant to the fair value measurement and unobservable (supported by little or no market activity). The Company did not have any assets or liabilities measured at fair value on a recurring basis at March 31, 2016 or December 31, 2015. The Company did not have any fair value adjustments for assets and liabilities measured at fair value on a nonrecurring basis during the three months ended March 31, 2016 or 2015.
New Accounting Pronouncements	New Accounting Pronouncements In May 2014, FASB issued Accounting Standards Update (“ASU”) No. 2014-09, which creates ASC Topic 606, “ Revenue from Contracts with Customers” Revenue Recognition” Revenue Recognition—Construction-Type and Production-Type Contracts Other Assets and Deferred Costs—Contracts with Customers In August 2014, FASB issued ASU 2014-15, “ Presentation of Financial Statements Going Concern Disclosure of Uncertainties about an Entity’s Ability to Continue as a Going Concern Specifically, the amendments (1) provide a definition of the term substantial doubt, management’s plans, (4) require certain disclosures when substantial doubt is alleviated as a result of consideration of management’s plans, (5) require an express statement and other disclosures when substantial doubt is not alleviated, and (6) require an assessment for a period of one year after the date that the financial statements are issued (or available to be issued). The amendments in this ASU are effective for public and nonpublic entities for annual periods ending after December 15, 2016. Early adoption is permitted. The Company adopted SU 2014-15 during the three months ended March 31, 2016. Management does not believe that any other recently issued, but not yet effective accounting standards, if currently adopted, would have a material effect on the accompanying financial statements.
Reclassifications	Reclassifications Certain amounts in the March 31, 2015 Financial Statements have been reclassified to conform to the presentation used in the March 31, 2016 Financial Statements.

Summary of Significant Accoun16

Summary of Significant Accounting Policies (Tables)	3 Months Ended
	Mar. 31, 2016
Accounting Policies [Abstract]
Schedule Of Antidilutive Securities Excluded From Computation Of Earnings Per Share	2016 2015 Shares underlying options outstanding 620,000 830,000 Shares underlying warrants outstanding 3,096,919 1,114,776 Total 3,716,919 1,944,776

Stockholders' Equity (Deficit)

Stockholders' Equity (Deficit) (Tables)	3 Months Ended
	Mar. 31, 2016
Stockholders' Equity Note [Abstract]
Schedule of Share-based Compensation, Restricted Stock and Restricted Stock Units Activity [Table Text Block]	Number of Shares Weighted Average Grant Date Fair Value Unvested share balance, January 1, 2015 6,091,992 $ 1.07 Granted 809,111 0.34 Vested (1,525,546 ) 1.32 Forfeited (1,165,251 ) 1.40 Unvested share balance, December 31, 2015 4,210,306 $ 0.75 Granted — — Vested (950,596 ) 1.33 Forfeited — — Unvested share balance, March 31, 2016 3,259,710 $ 0.54
Schedule Of Stockholders Equity Note Warrants Or Rights	Number of Warrants Outstanding at January 1, 2015 1,114,776 Issued in connection with the 2015 Subscription 1,500,000 Outstanding at December 31, 2015 2,614,776 Issued in connection with the 2016 Subscription 482,143 Outstanding at March 31, 2016 3,096,919 Exercisable at March 31, 2016 3,096,919

Restatement (Tables)

Restatement (Tables)	3 Months Ended
	Mar. 31, 2016
Notes to Financial Statements
Restatement	The net effect of the error and its restatement for the nine months ended September 30, 2015 is set forth as follows: As Net As Reported Change Restated Selling, general and administrative expenses $ 1,294,660 $ 337,532 $ 1,632,192 Total operating expenses $ 877,437 $ 337,532 $ 1,214,969 Net loss $ 1,007,003 $ 337,532 $ 1,344,535 Net loss available to common stockholders, basic and fully diluted $ 0.06 $ 0.02 $ 0.08 The net effect of the error and its restatement for the three months ended September 30, 2015 is set forth as follows: As Net As Reported Change Restated Selling, general and administrative expenses $ 312,629 $ 39,000 $ 351,629 Total operating expenses $ 372,629 $ 39,000 $ 411,629 Net loss $ 410,989 $ 39,000 $ 449,989 Net loss available to common stockholders, basic and fully diluted $ 0.02 $ 0.01 $ 0.03

Summary of Significant Accoun19

Summary of Significant Accounting Policies - Antidilutive Securities Excluded From Computation Of Earnings Per Share (Details) - shares	3 Months Ended
	Mar. 31, 2016	Mar. 31, 2015
Accounting Policies [Abstract]
Shares underlying options outstanding	620,000	830,000
Shares underlying warrants outstanding	3,096,919	1,114,776
Total	3,716,919	1,944,776

Summary of Significant Accoun20

Summary of Significant Accounting Policies (Details Narrative) - USD ($)	Mar. 31, 2016	Dec. 31, 2015
Accounting Policies [Abstract]
Accumulated depreciation	$ 1,119	$ 935
Allowance for doubtful accounts	$ 0	$ 3,000

Alleviation of Going Concern 21

Alleviation of Going Concern Qualification	3 Months Ended
	Mar. 31, 2016USD ($)
Organization, Consolidation and Presentation of Financial Statements [Abstract]
Working capital	$ 382,372
Private placement	$ 337,500

Inventory (Details Narrative)

Inventory (Details Narrative) - USD ($)	Mar. 31, 2016	Dec. 31, 2015
Inventory Disclosure [Abstract]
Finished goods inventory	$ 93,172	$ 33,473

Commitments and Contingencies (

Commitments and Contingencies (Details Narrative) - USD ($)	Mar. 27, 2015	Mar. 31, 2016	Mar. 31, 2015	Dec. 31, 2015	May. 29, 2015
Monthly office fee		$ 1,389
Lease expense		5,389	$ 4,820
License (settlement) fee	$ 2,283,085	1,775,862
Liquidated damages	1,515,076
Outstanding royalties	$ 768,009				$ 90,000
Net Income		$ 381,562	$ 2,671,684	$ 417,223
CEO
Employment Agreement terms		On June 15, 2015, the Company entered into an Amended and Restated Employment Agreement (the "Simpson Agreement") with Glenn Simpson pursuant to which Mr. Simpson will continue to act as the Company's CEO and Chairman for a term of five (5) years as extended in consideration of (i) a base salary of $5,000 per month from June 2015 through September 2015 and then increasing to $18,500 per month, (ii) 1,544,737 shares of common stock of the Company to be issued to Mr. Simpson upon the Company generating revenue of $3,000,000 during any 12 month period during the term (the “Simpson Shares”) and (iii) an annual bonus comprised of cash and Common Stock based on performance goals established by the Board of Directors of the Company as set forth in the Simpson Agreement. The cash bonus is established at 20% of the annual salary. The stock bonus is set at 200,000 shares of Common Stock per year through December 31, 2021 based upon revenue performance goals. The revenue goals range from $900,000 to $19,200,000 per year. The bonus awards may be accelerated should revenue exceed the annual target amounts. On December 15, 2015, the Company and Mr. Simpson entered into an amendment to the Simpson Agreement increasing the Simpson Shares by 337,500.
COO
Employment Agreement terms		On June 15, 2015, the Company entered into an Amended and Restated Employment Agreement (the "Spinner Agreement") with Peter Spinner pursuant to which Mr. Spinner will continue to act as the Company's COO for a term of five (5) years as extended in consideration of (i) a base salary of $8,000 per month from June 2015 through September 2015 and then increasing to $16,000 per month, (ii) 252,632 shares of common stock of the Company to be issued to Mr. Spinner upon the Company generating revenue of $3,000,000 during any 12 month period during the term (the “Spinner Shares”) and (iii) an annual bonus comprised of cash and Common Stock based on performance goals established by the Board of Directors of the Company as set forth in the Spinner Agreement. The cash bonus is established at 20% of the annual salary. The stock bonus is set at 375,000 shares of Common Stock per year through December 31, 2018 and 200,000 shares of Common Stock per year from 2019 through December 31, 2021 based upon revenue performance goals. The revenue goals range from $900,000 to $19,200,000 per year. The bonus awards may be accelerated should revenue exceed the annual target amounts. On December 15, 2015, the Company and Mr. Spinner entered into an amendment to the Spinner Agreement increasing the number of Spinner Shares by 345,000.

Stockholders' Equity (Deficit24

Stockholders' Equity (Deficit) - Schedule of Share-based Compensation, Restricted Stock Activity (Details) - $ / shares	3 Months Ended	12 Months Ended
	Mar. 31, 2016	Dec. 31, 2014
Stockholders' Equity Note [Abstract]
Unvested share balance	4,210,306
Weighted Average Grant Date Fair Value, balance, Beginning	$ 0.75
Weighted Average Grant Date Fair Value, balance, End	$ 0.54
Number of Shares, Granted		809,111
Weighted Average Grant Date Fair Value, Granted		$ 0.34
Number of Shares, Vested	(950,596)	(1,525,546)
Weighted Average Grant Date Fair Value, Vested	$ 1.33	$ 1.32
Number of Shares, Forfeited		(1,165,251)
Weighted Average Grant Date Fair Value, Forfeited		$ 1.40

Stockholders' Equity (Deficit25

Stockholders' Equity (Deficit) - Schedule Of Stockholders Equity Note Warrants Or Rights (Details) - USD ($)	3 Months Ended	12 Months Ended
	Mar. 31, 2016	Dec. 31, 2015	Dec. 31, 2014
Stockholders' Equity Note [Abstract]
Warrants Outstanding	$ 3,096,919	$ 2,614,776	$ 1,114,776
Warrants Issued	482,143	1,500,000
Warrants Exercisable	3,096,919

Stockholders' Equity (Details)

Stockholders' Equity (Details) - USD ($)	Oct. 03, 2013	Jan. 20, 2016	Dec. 31, 2015	Aug. 31, 2015	Mar. 31, 2014	Mar. 31, 2016	Mar. 31, 2015	Dec. 31, 2014	Dec. 31, 2013	Oct. 31, 2015	Jun. 30, 2015	Oct. 03, 2014	Mar. 31, 2013
Preferred Stock, Shares Authorized			10,000,000			10,000,000
Common Stock, Shares Authorized			190,000,000			190,000,000
Preferred Stock, Par or Stated Value Per Share (in Dollars per share)			$ 0.001			$ 0.001
Common Stock, Par or Stated Value Per Share (in Dollars per share)			$ 0.001			$ 0.001
Share-based Compensation Arrangement by Share-based Payment Award, Number of Shares Authorized											35,000
Consideration for Stock issued (in Dollars)						$ 337,500
Sale of Stock, Price Per Share (in Dollars per share)											$ 0.255
Share-Based Compensation Arrangement By Share Based Payment Award Award Shares Which Vest Based Upon Certain Milestones						2,026,884
Shares that did not vest			4,210,306			3,259,710
Recorded Share-based Compensation Expense, in connection with restriced stock						$ 231,984	$ 374,978
Employee Service Share-based Compensation, Nonvested Awards, Compensation Cost Not yet Recognized (in Dollars)						950,596
Unrecognized compensation expense related to unvested share-based compensation						$ 490,426
Employees and Directors
Share-Based Compensation Arrangement By Share Based Payment Award Award Shares Which Vest Based Upon Certain Milestones			1,726,485			1,726,485
Restricted common stock, cancelled			1,165,251
Former Director
Share-Based Compensation Arrangement By Share Based Payment Award Award Shares Which Vest Based Upon Certain Milestones						582,626
Officers and Employees
Share-Based Compensation Arrangement By Share Based Payment Award Award Shares Which Vest Based Upon Certain Milestones			682,500	226,485							2,023,854
Revenue Threshold			$ 3,000,000	$ 3,000,000							$ 3,000,000
Shares that did not vest				1,797,369
2015 Subscription
Consideration for Stock issued (in Dollars)				$ 150,000	$ 1,819,832
Stock Issued During Period, Shares, New Issues				750,000	2,016,483
Sale of Stock, Price Per Share (in Dollars per share)						$ 0.91
Stock Issued During Period, Value, New Issues (in Dollars)					$ 1,835,000
Warrants issued				1,500,000		1,500,000
Exercise price, per share				$ .40		$ .40
Agreement with Mr. Ian Thompson
Share-Based Compensation Arrangement By Share Based Payment Award Award Shares Which Vest Based Upon Certain Milestones												200,000
Shares issued for consulting work	167,204
Consulting fees	$ 501,612							$ 105,000	$ 280,000
Shares pending cancellation due to lack of delivery of consideration and break of the agreement								367,204
2016 Subscription
Consideration for Stock issued (in Dollars)		$ 337,500
Stock Issued During Period, Shares, New Issues		1,428,572				964,286
Sale of Stock, Price Per Share (in Dollars per share)		$ .35
Aggregate shares of common stock		714,286				482,143
Warrants issued						482,143
Exercise price, per share		$ .70				$ .70
Employee Stock Option | Long Term Incentive Equity Plan 2015
Share-based Compensation Arrangement by Share-based Payment Award, Number of Shares Authorized										1,500,000
Employee Stock Option | Long Term Incentive Equity Plan 2012
Share-based Compensation Arrangement by Share-based Payment Award, Number of Shares Authorized													2,050,000

Stock Options (Details Narrativ

Stock Options (Details Narrative) - USD ($)	3 Months Ended	9 Months Ended
	Mar. 31, 2016	Sep. 30, 2014	Jun. 30, 2015
Other Liabilities Disclosure [Abstract]
Stock Options granted			35,000
Exercise price per share			$ 0.255
Compensation expense	$ 18,809	$ 19,165
Total unrecognized compensation cost related to non-vested stock options	$ 27,618

Related Party Transactions (Det

Related Party Transactions (Details Narrative) - USD ($)	3 Months Ended
	Mar. 31, 2016	Jan. 31, 2016	Dec. 31, 2015	Aug. 31, 2015	Jun. 30, 2015
Common stock issued					35,000
Common stock issued, value	$ 18,274		$ 17,309
Common stock issued, per share	$ 0.001		$ 0.001
Increase to additional paid in capital	$ 95,500
Wyatts Torch Equity Partners, L.P.
Common stock issued		285,714		750,000
Common stock issued, value		$ 100,000		$ 150,000
Warrants issued		142,857		1,500,000
Common stock issued, per share		$ 0.70		$ 0.40
CEO
Accrued Payroll			$ 3,050
Forgiveness of unpaird salary	51,500
COO
Accrued Payroll			3,050
Forgiveness of unpaird salary	$ 44,000
Controller
Common stock issued				226,485
Accrued Payroll			$ 3,050
Revenue Goals				$ 3,000,000