LogicMark (LGMK) 10-Q 14 Aug 17 2017 Q2 Quarterly report Financial data

Document and Entity Information

Document and Entity Information - shares	6 Months Ended
	Jun. 30, 2017	Aug. 11, 2017
Document and Entity Information [Abstract]
Entity Registrant Name	Nxt-ID, Inc.
Entity Central Index Key	1,566,826
Amendment Flag	false
Trading Symbol	NXTD
Current Fiscal Year End Date	--12-31
Document Type	10-Q
Document Period End Date	Jun. 30, 2017
Document Fiscal Year Focus	2,017
Document Fiscal Period Focus	Q2
Entity Filer Category	Smaller Reporting Company
Entity Common Stock, Shares Outstanding		15,118,969

Condensed Consolidated Balance

Condensed Consolidated Balance Sheets - USD ($)	Jun. 30, 2017	Dec. 31, 2016
Current Assets
Cash	$ 1,271,577	$ 3,299,679
Restricted cash	40,371	40,371
Accounts receivable	2,397,043	1,218,705
Inventory, net	5,257,650	5,341,500
Prepaid expenses and other current assets	1,588,667	1,347,627
Total Current Assets	10,555,308	11,247,882
Property and equipment:
Equipment	189,199	175,537
Furniture and fixtures	98,828	79,062
Tooling and molds	581,881	581,881
Depreciable assets, Total	869,908	836,480
Accumulated depreciation	(548,127)	(456,752)
Property and equipment, net	321,781	379,728
Goodwill	23,433,922	15,479,662
Other intangible assets, net of amortization of $775,994 and $318,842, respectively	13,073,973	8,285,725
Total Assets	47,384,984	35,392,997
Current Liabilities
Accounts payable	2,599,699	2,070,658
Accrued expenses	3,433,867	2,901,672
Customer deposits	4,004,846	6,068,894
Short-term debt	736,929	773,969
Convertible notes payable, net of discount of $616,667 and $1,366,667, respectively, and net of deferred debt issuance costs of $59,915 and $123,563, respectively	823,418	9,770
Other current liabilities - contingent consideration	6,600,733	1,496,442
Total Current Liabilities	18,199,492	13,321,405
Other long-term liabilities - contingent consideration	3,961,393	4,832,028
Long-term debt	638,881
Revolving loan facility, net of deferred debt issuance costs of $87,179 and $769,453, respectively	14,912,821	14,230,547
Deferred tax liability	2,174,137	190,286
Total Liabilities	39,886,724	32,574,266
Commitments and Contingencies
Series C Preferred Stock, $0.0001 par value: 2,000 shares designated, 2,000 and 0 shares issued and outstanding as of June 30, 2017 and December 31, 2016, respectively	1,900,000
Stockholders' Equity
Preferred Stock, value
Common Stock, $0.0001 par value: 100,000,000 shares authorized; 12,188,943 and 7,379,924 issued and outstanding, respectively	1,219	738
Additional paid-in capital	41,263,550	33,204,943
Accumulated deficit	(36,589,333)	(34,659,801)
Total Stockholders' Equity	5,598,260	2,818,731
Total Liabilities, Series C Preferred Stock and Stockholders' Equity	47,384,984	35,392,997
Series A Preferred Stock
Stockholders' Equity
Preferred Stock, value	95,588	182,851
Series B Preferred Stock
Stockholders' Equity
Preferred Stock, value	$ 827,236	$ 4,090,000

Condensed Consolidated Balance3

Condensed Consolidated Balance Sheets (Parenthetical) - USD ($)	Jun. 30, 2017	Dec. 31, 2016
Other intangible assets, net of amortization	$ 775,994	$ 318,842
Convertible notes payable, net of discount	616,667	1,366,667
Net of deferred debt issuance costs	59,915	123,563
Revolving loan facility, net of deferred debt issuance cost	$ 87,179	$ 769,453
Series C Preferred Stock, par value	$ 0.0001	$ 0.0001
Series C Preferred Stock, shares authorized	2,000	2,000
Series C Preferred Stock, shares issued	2,000	0
Series C Preferred Stock, shares outstanding	2,000	0
Preferred stock, par value	$ 0.0001	$ 0.0001
Preferred stock, shares authorized	10,000,000	10,000,000
Common stock, par value	$ 0.0001	$ 0.0001
Common stock, shares authorized	100,000,000	100,000,000
Common stock, shares issued	12,188,943	7,379,924
Common stock, shares outstanding	12,188,943	7,379,924
Series A Preferred Stock
Preferred stock, par value	$ 0.0001	$ 0.0001
Preferred stock, shares authorized	3,125,000	3,125,000
Preferred stock, shares issued	110,525	211,424
Preferred stock, shares outstanding	110,525	211,424
Preferred stock, liquidation preferences	$ 145,408	$ 440,594
Series B Preferred Stock
Preferred stock, par value	$ 0.0001	$ 0.0001
Preferred stock, shares authorized	4,500,000	4,500,000
Preferred stock, shares issued	910,162	4,500,000
Preferred stock, shares outstanding	910,162	4,500,000
Preferred stock, liquidation preferences	$ 1,137,703	$ 5,625,000

Condensed Consolidated Statemen

Condensed Consolidated Statements of Operations (Unaudited) - USD ($)	3 Months Ended		6 Months Ended
	Jun. 30, 2017	Jun. 30, 2016	Jun. 30, 2017	Jun. 30, 2016
Statements of Operations [Abstract]
Revenues	$ 7,656,179	$ 38,493	$ 14,337,476	$ 80,795
Cost of goods sold	3,862,765	64,014	7,034,772	139,169
Gross Profit (Loss)	3,793,414	(25,521)	7,302,704	(58,374)
Operating Expenses
General and administrative	1,861,672	1,586,826	3,222,358	2,713,414
Selling and marketing	1,087,663	311,031	2,084,421	1,117,549
Research and development	177,678	383,356	262,622	744,680
Total Operating Expenses	3,127,013	2,281,213	5,569,401	4,575,643
Operating Income (Loss)	666,401	(2,306,734)	1,733,303	(4,634,017)
Other Income and (Expense)
Interest income				23
Interest expense	(1,719,082)	(202,842)	(3,423,012)	(715,509)
Change in fair value of derivative liabilities				(2,299,020)
Change in fair value of contingent consideration	(53,448)		(53,448)
Loss on extinguishment of debt				(272,749)
Total Other Expense, Net	(1,772,530)	(202,842)	(3,476,460)	(3,287,255)
Loss before Income Taxes	(1,106,129)	(2,509,576)	(1,743,157)	(7,921,272)
Provision for Income Taxes	(93,188)		(186,375)
Net Loss	(1,199,317)	(2,509,576)	(1,929,532)	(7,921,272)
Preferred stock dividend	(295,424)	(142,586)	(608,069)	(142,586)
Net Loss applicable to Common Stockholders	$ (1,494,741)	$ (2,652,162)	$ (2,537,601)	$ (8,063,858)
Net Loss Per Share - Basic and Diluted applicable to Common Stockholders	$ (0.15)	$ (0.45)	$ (0.28)	$ (1.47)
Weighted Average Number of Shares of Common Stock Outstanding - Basic and Diluted	10,305,909	5,866,444	9,078,808	5,472,892

Condensed Consolidated Stateme5

Condensed Consolidated Statements of Cash Flows (Unaudited) - USD ($)	6 Months Ended
	Jun. 30, 2017	Jun. 30, 2016
Cash Flows from Operating Activities
Net Loss	$ (1,929,532)	$ (7,921,272)
Adjustments to reconcile net loss to net cash used in operating activities:
Depreciation	91,375	120,147
Stock based compensation	420,096	554,688
Amortization of debt discount	750,000	409,450
Amortization of intangible assets	457,152
Amortization of discount on contingent consideration	85,077
Change in fair value of contingent consideration	53,448
Loss on extinguishment of debt		272,749
Amortization of deferred debt issuance costs	753,422	25,200
Deferred taxes	(186,375)
Change in fair value of derivative liabilities		2,299,020
Loss on conversion of convertible note interest		34,628
Changes in operating assets and liabilities:
Accounts receivable	(1,086,529)
Inventory	83,850	(447,083)
Prepaid expenses and other current assets	(269,145)	(16,640)
Accounts payable	348,443	(325,956)
Accrued expenses	687,684	578,759
Customer deposits	(2,311,747)	1,241,048
Total Adjustments	(1,547,975)	4,746,010
Net Cash Used in Operating Activities	(1,680,031)	(3,175,262)
Cash Flows from Investing Activities
Restricted cash		1,495,449
Acquisition, net of cash acquired	(89,111)
Purchase of equipment	(1,460)	(38,423)
Net Cash (Used in) Provided by Investing Activities	(90,571)	1,457,026
Cash Flows from Financing Activities
Proceeds received from issuance of Series A preferred stock, net		1,869,775
Proceeds received from short-term promissory note		400,000
Pay down of short-term debt	(250,000)
Fees paid in connection with equity offerings	(7,500)	(43,021)
Proceeds from exercise of common stock warrants		50,000
Net Cash (Used in) Provided by Financing Activities	(257,500)	2,276,754
Net (Decrease) Increase in Cash	(2,028,102)	558,518
Cash - Beginning of Period	3,299,679	418,991
Cash - End of Period	1,271,577	977,509
Cash paid during the periods for:
Interest	1,137,500
Taxes	4,500	3,500
Non-cash financing activities:
Accrued fees incurred in connection with equity offerings		151,703
Issuance of common stock in connection with accelerated installments of notes payable		2,779,119
Issuance of common stock in connection with conversion of interest on convertible notes		281,588
Reclassification of conversion feature liability in connection with note modification		1,702,400
Issuance of common stock in connection with conversion of Series A preferred stock		19,016
Issuance of common stock in connection with acquisition		300,000
Issuance of warrants in connection with acquisition		600,000
Exchange of short-term promissory note for Series A preferred stock		400,000
Issuance of common stock in connection with conversion of Series A preferred stock and related dividends	197,105
Issuance of common stock in connection with conversion of Series B preferred stock and related dividends and liquidated damages	4,846,286
Accrued Series A preferred dividends	31,395	142,586
Accrued Series B preferred dividends	562,500
Accrued Series C preferred dividends	10,685
Assets acquired and liabilities assumed:
Current assets, including cash acquired	179,794
Property and equipment	31,967
Other intangible assets	5,245,400
Goodwill	7,954,260
Accounts payable and accrued liabilities	(1,130,113)
Customer deposits	(286,948)
Deferred taxes	(1,797,476)
Net Assets Acquired	10,196,884
Less: cash paid to acquire Fit Pay	(100,000)
Non cash consideration	10,096,884
Non-cash consideration consisted of:
Note payable issued to seller	851,842
Common stock issued to sellers	3,289,161
Series C preferred stock issued to sellers	1,900,000
Earn-out provision	4,055,881
Non-cash consideration	$ 10,096,884

Organization and Basis of Prese

Organization and Basis of Presentation	6 Months Ended
	Jun. 30, 2017
Organization and Basis of Presentation [Abstract]
ORGANIZATION AND BASIS OF PRESENTATION	Note 1 – Organization and Basis of Presentation Organization and Principal Business Activities Nxt-ID, Inc. (“Nxt-ID” or the “Company”) was incorporated in the State of Delaware on February 8, 2012. Nxt-ID is a security technology company providing security for finance, assets and healthcare. The Company operates its business in one segment — hardware and software security systems and applications. The Company’s innovative MobileBio® solution mitigates risks associated with mobile computing, m-commerce and smart OS-enabled devices. With extensive experience in biometric identity verification, security, privacy, encryption and data protection, payments, miniaturization and sensor technologies, the Company partners with companies to provide solutions for modern payment and the “Internet of Things” (“IoT”) applications. On July 25, 2016, the Company completed the acquisition of LogicMark, LLC (“LogicMark”) pursuant to an Interest Purchase Agreement by and among the Company, LogicMark and the holders of all of the membership interests of LogicMark (the “LogicMark Sellers”), dated May 17, 2016. The Company is required to pay the LogicMark Sellers an earn-out payment of (i) $1,500,000 for calendar year 2016 and (ii) and may be required to pay the LogicMark Sellers an earn-out payment of up to $5,000,000 for calendar year 2017 if LogicMark meets certain gross profit targets set forth in the Interest Purchase Agreement. The secured subordinated promissory note originally issued to LogicMark Investment Partners on July 25, 2016 and amended on November 29, 2016 (the “LogicMark Note”) was to mature on September 23, 2016 but was extended to April 15, 2017 and then extended to July 15, 2017. The Company and the LogicMark Sellers also agreed to extend the due date on the 2016 earn-out payment to July 15, 2017.As of June 30, 2017, the 2016 earn-out payment and principal and interest due on the LogicMark Note amount to an aggregate of $1,500,000 and $591,783, respectively, and have been included as a component of current liabilities on the condensed consolidated balance sheet as of June 30, 2017. In July 2017, the Company paid the 2016 earn-out payment in the amount of $1,500,000 to the LogicMark Sellers. In addition, in July 2017, the remaining balance of $594,403 owed on the LogicMark Note, including accrued and unpaid interest, , was purchased by certain investors in exchange for $594,403 in principal amount of convertible notes of the Company and warrants exercisable for 297,202 shares of Common Stock. See Note 9 hereto. On May 23, 2017, the Company completed a merger (the “Merger”) pursuant to an executed Agreement and Plan of Merger (the “Merger Agreement”) by and among the Company, Fit Merger Sub, Inc., a wholly-owned subsidiary of the Company (the “Merger Sub”), Fit Pay, Inc. (“Fit Pay”), Michael Orlando (“Orlando”), Giesecke & Devrient Mobile Security America, Inc. (“G&D”), the other stockholders of Fit Pay (the “Other Holders”) and Michael Orlando in his capacity as stockholder representative representing the Other Holders (the “Stockholder Representative”, and together with Orlando and G&D, the “Sellers”). Pursuant to the Merger, Fit Pay merged with and into the Merger Sub, with the Merger Sub continuing as the surviving entity and a wholly-owned subsidiary of the Company. See Note 5. The Company’s wholly-owned subsidiary, LogicMark, manufactures and distributes non-monitored and monitored personal emergency response systems sold through the United States Department of Veterans Affairs, healthcare durable medical equipment dealers and distributors and monitored security dealers and distributors. The Company’s wholly-owned subsidiary, Fit Pay, Inc. (“Fit Pay”) has a proprietary technology platform that delivers payment, credential management, authentication and other secure services to the IoT ecosystem. The platform uses tokenization, a payment security technology that replaces cardholders’ account information with a unique digital identifier, to transact highly secure contactless payment and authentication services. Basis of Presentation The accompanying unaudited condensed consolidated financial statements as of June 30, 2017 and for the six and three months then ended have been prepared in accordance with the accounting principles generally accepted in the United States of America (“GAAP”) for interim financial information and pursuant to the instructions to Form 10-Q and Article 8 of Regulation S-X of the Securities and Exchange Commission (“SEC”) and on the same basis as the Company prepares its annual audited consolidated financial statements. The unaudited condensed consolidated balance sheet as of June 30, 2017 and the condensed consolidated statements of operations for the six and three months ended June 30, 2017 and June 30, 2016 and the condensed consolidated statements of cash flows for the six months ended June 30, 2017 and June 30, 2016 are unaudited, but include all adjustments, consisting only of normal recurring adjustments, which the Company considers necessary for a fair presentation of the financial position, operating results and cash flows for the periods presented. The results for the six and three months ended June 30, 2017 are not necessarily indicative of results to be expected for the year ending December 31, 2017 or for any future interim period. The condensed consolidated balance sheet at December 31, 2016 has been derived from audited consolidated financial statements. However, it does not include all of the information and notes required by GAAP for complete consolidated financial statements. The accompanying condensed consolidated financial statements should be read in conjunction with the consolidated financial statements for the year ended December 31, 2016, and notes thereto included in the Company’s annual report on Form 10-K, which was filed with the SEC on April 14, 2017 (the “2016 10-K”), and Amendment No. 1 to the 2016 10-K filed with the SEC on July 7, 2017.

Reverse Stock Split

Reverse Stock Split	6 Months Ended
	Jun. 30, 2017
Reverse Stock Split [Abstract]
REVERSE STOCK SPLIT	Note 2 – Reverse Stock Split On September 1, 2016, the Company’s board of directors and stockholders approved a resolution to amend the Company’s Certificate of Incorporation and to authorize the Company to effect a reverse split of the Company’s outstanding common stock at a ratio of 1-for-10 (the “Reverse Split”). On September 9, 2016, the Company effected the Reverse Split. Upon effectiveness of the Reverse Split, every 10 shares of outstanding common stock decreased to one share of common stock. Throughout this report, the Reverse Split was retroactively applied to all periods presented.

Liquidity and Management Plans

Liquidity and Management Plans	6 Months Ended
	Jun. 30, 2017
Liquidity and Management Plans [Abstract]
LIQUIDITY AND MANAGEMENT PLANS	Note 3 - Liquidity and Management Plans The Company is an emerging growth company and recorded operating income of $1,733,303 and a net loss of $1,929,532 during the six months ended June 30, 2017. As of June 30, 2017 the Company had a working capital deficiency of $7,644,184 (including contingent consideration of $6,600,733) and stockholders’ equity of $5,598,260. Given the Company’s cash position at June 30, 2017, proceeds from equity and note offerings subsequent to June 30, 2017 (See Note 9) and its projected cash flow from operations over the next twelve months, the Company believes that it will have sufficient capital to sustain operations over the next twelve months following the date of this filing. In order to execute the Company’s long-term strategic plan to develop and commercialize its core products, fulfill its product development commitments and fund its obligations as they come due, the Company may need to raise additional funds, through public or private equity offerings, debt financings, or other means. Should the Company not be successful in obtaining the necessary financing, or generate sufficient revenue to fund its operations, the Company would need to engage in certain cost containment efforts, and/or curtail certain of its operational activities.

Summary of Significant Accounti

Summary of Significant Accounting Policies	6 Months Ended
	Jun. 30, 2017
Summary of Significant Accounting Policies [Abstract]
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES	Note 4 - Summary Of Significant Accounting Policies Use of Estimates in the Financial Statements The preparation of financial statements in conformity with 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 date of the financial statements and the reported amounts of revenues and expenses during the reporting period. The Company’s management evaluates these significant estimates and assumptions including those related to the fair values of acquired assets and liabilities assumed in business combinations, stock based compensation, derivative financial instruments, income taxes and related valuation allowances, accounts receivable and inventory, and other matters that affect the condensed consolidated financial statements and disclosures. Actual results could differ from those estimates. Principles of consolidation The condensed consolidated financial statements include the accounts of Nxt-ID and its wholly-owned subsidiaries, 3D-ID, LogicMark and Fit Pay. Intercompany balances and transactions have been eliminated in consolidation. Concentrations of Credit Risk During the six and three months ended June 30, 2017, the Company recognized revenue of $6,289,281 and $3,581,245 respectively, from World Ventures Holdings, LLC (“WVH”), a related party based on its position as the Company’s largest stockholder. At June 30, 2017, the Company’s accounts receivable balance included $1,797,941 due from WVH. Revenue Recognition The Company recognizes revenue from product sales when persuasive evidence of an arrangement exists, the service has been rendered or product delivery has occurred, the price is fixed or readily determinable and collectability of the sale is reasonably assured. Accounts Receivable Accounts receivable is stated at net realizable value. The Company regularly reviews accounts receivable balances and adjusts the receivable reserves as necessary whenever events or circumstances indicate the carrying value may not be recoverable. The Company had no allowance for doubtful accounts at June 30, 2017 and December 31, 2016. Inventory The Company performs regular reviews of inventory quantities on hand and evaluates the realizable value of its inventories. The Company adjusts the carrying value of the inventory as necessary with estimated valuation reserves for excess, obsolete, and slow-moving inventory by comparing the individual inventory parts to forecasted product demand or production requirements. As of June 30, 2017 inventory was comprised of $3,914,501 in raw materials and $1,343,149 in finished goods on hand. Inventory at December 31, 2016 was comprised of $3,797,499 in raw materials and $1,544,001 in finished goods on hand. The Company is required to prepay for raw materials with certain vendors until credit terms can be established. As of June 30, 2017 and December 31, 2016, the Company had prepaid inventory of $1,126,701 and $1,089,770, respectively. These prepayments were made primarily for raw materials inventory and prepaid inventory is included in prepaid expenses and other current assets on the condensed consolidated balance sheet. Goodwill The Company’s goodwill relates to the acquisitions of LogicMark and Fit Pay. The Company will begin testing goodwill for impairment annually in the third quarter of each year using data as of August 1 of that year. Authoritative accounting guidance allows the Company to first assess qualitative factors to determine whether it is necessary to perform the more detailed two-step quantitative goodwill impairment test. The Company performs the quantitative test if its qualitative assessment determined it is more likely than not that a reporting unit’s fair value is less than its carrying amount. The Company may elect to bypass the qualitative assessment and proceed directly to the quantitative test for any reporting units or assets. The quantitative goodwill impairment test, if necessary, is a two-step process. The first step is to identify the existence of a potential impairment by comparing the fair value of a reporting unit (the estimated fair value of a reporting unit is calculated using a discounted cash flow model) with its carrying amount, including goodwill. If the fair value of a reporting unit exceeds its carrying amount, the reporting unit’s goodwill is considered not to be impaired and performance of the second step of the quantitative goodwill impairment test is unnecessary. However, if the carrying amount of a reporting unit exceeds its fair value, the second step of the quantitative goodwill impairment test is performed to measure the amount of impairment loss to be recorded, if any. The second step of the quantitative goodwill impairment test compares the implied fair value of the reporting unit’s goodwill with the carrying amount of that goodwill. If the carrying amount of the reporting unit’s goodwill exceeds its implied fair value, an impairment loss is recognized in an amount equal to that excess. The implied fair value of goodwill is determined using the same approach as employed when determining the amount of goodwill that would be recognized in a business combination. That is, the fair value of the reporting unit is allocated to all of its assets and liabilities as if the reporting unit had been acquired in a business combination and the fair value was the purchase price paid to acquire the reporting unit. Other Intangible Assets The Company’s intangible assets are all related to the acquisitions of LogicMark and FitPay and are included in other intangible assets in the Company’s condensed consolidated balance sheets at June 30, 2017 and December 31, 2016. At June 30, 2017, the other intangible assets related to the acquisition of LogicMark are comprised of patents of $3,751,780; trademarks of $1,198,822; and customer relationships of $2,957,346. At December 31, 2016, the other intangible assets are comprised of patents of $3,936,612; trademarks of $1,230,002; and customer relationships of $3,119,111. The Company will continue amortizing these intangible assets using the straight line method over their estimated useful lives which for the patents, trademarks and customer relationships are 11 years; 20 years; and 10 years, respectively. During the six and three months ended June 30, 2017, the Company had amortization expense of $377,777 and $189,932, respectively related to the LogicMark intangible assets. At June 30, 2017, the other intangible assets related to the acquisition of Fit Pay, As of June 30, 2017, amortization expense estimated for the remainder of fiscal year 2017 related to both the LogicMark and Fit Pay intangibles is approximately $755,000 and for each of the next five fiscal years, 2018 through 2022, the amortization expense is estimated to be approximately $1,505,000 per year. Stock-Based Compensation The Company accounts for share-based awards exchanged for employee services at the estimated grant date fair value of the award. The Company accounts for equity instruments issued to non-employees at their fair value on the measurement date. The measurement of stock-based compensation is subject to periodic adjustment as the underlying equity instrument vests or becomes non-forfeitable. Non-employee stock-based compensation charges are amortized over the vesting period or as earned. The Company generally issues new shares of common stock to satisfy conversion and warrant exercises. Net Loss per Share Basic loss per share was computed using the weighted average number of common shares outstanding. Diluted loss per share includes the effect of diluted common stock equivalents. Potentially dilutive securities of 546,003 realizable from the Series A Preferred Stock and Series B Preferred Stock (as defined in Note 7), and 575,000 from the convertible notes and from the exercise of 1,829,049 warrants as of June 30, 2017 were excluded from the computation of diluted net loss per share because the effect of their inclusion would have been anti-dilutive for the six and three months ended June 30, 2017. As of June 30, 2016, potentially dilutive securities from the conversion of convertible notes of $515,731 and related accrued interest and from the exercise of warrants into 9,140,293 shares of Common Stock were excluded from the computation of diluted net loss per share because the effect of their inclusion would have been anti-dilutive. Recent Accounting Pronouncements In March 2016, the FASB issued ASU No. 2016-09 (“ASU 2016-09”), “Compensation—Stock Compensation (Topic 718): Improvements to Employee Share-Based Payment Accounting.” ASU 2016-09 will affect all entities that issue share-based payment awards to their employees and is effective for annual periods beginning after December 15, 2016 for public entities. The areas for simplification in ASU 2016-09 involve several aspects of the accounting for share-based payment transactions, including the income tax consequences, classification of awards as either equity or liabilities, and classification on the statement of cash flows. The Company adopted this standard in the first quarter of 2017 and it did not have a material impact on its condensed consolidated financial statements. In May 2016, the FASB issued ASU No. 2016-12 (“ASU 2016-12”), “Revenue from Contracts with Customers (Topic 606): Narrow- Scope Improvements and Practical Expedients.” ASU 2016-12 will affect all entities that enter into contracts with customers to transfer goods or services (that are an output of the entity’s ordinary activities) in exchange for consideration. The amendments in this update affect the guidance in ASU 2014-09 which is not yet effective, the amendments in this update affect narrow aspects of Topic 606 including among others: assessing collectability criterion, noncash consideration, and presentation of sales taxes and other similar taxes collected from customers. The effective date and transition requirements for the amendments in this update are the same as the effective date and transition requirements for ASU 2014-09. The Company is currently evaluating the effect that ASU 2016-12 will have on the Company’s condensed consolidated financial position and results of operations. In January 2017, the FASB issued ASU No. 2017-01, “Business Combinations (Topic 805): Clarifying the Definition of a Business.” The amendments in this update clarify the definition of a business with the objective of adding guidance to assist entities with evaluating whether transactions should be accounted for as acquisitions (or disposals) of businesses. The amendments in this update provide a screen to determine when a set is not a business. If the screen is not met, it (1) requires that to be considered a business, a set must include, at a minimum, an input and a substantive process that together significantly contribute to the ability to create output and (2) removes the evaluation of whether a market participant could replace the missing elements. The amendments in this Update are effective for all entities for annual periods, and interim periods within those annual periods, beginning after December 15, 2017. Early adoption is permitted. This iASU is not expected to have a material impact on the Company’s condensed consolidated financial statements. In May 2017, the FASB issued ASU 2017-09, “Compensation—Stock Compensation (Topic 718): Scope of Modification Accounting” to provide clarity and reduce both (1) diversity in practice and (2) cost and complexity when applying the guidance in Topic 718, Compensation—Stock Compensation, to a change to the terms or conditions of a share-based payment award. The amendments in this Update provide guidance about which changes to the terms or conditions of a share-based payment award require an entity to apply modification accounting in Topic 718. The amendments in this Update are effective for all entities for annual periods, and interim periods within those annual periods, beginning after December 15, 2017. Early adoption is permitted. This ASU is not expected to have a material impact on the Company’s condensed consolidated financial statements.

Acquisitions

Acquisitions	6 Months Ended
	Jun. 30, 2017
Acquisitions [Abstract]
ACQUISITIONS	Note 5 – Acquisitions Acquisition of Logicmark LLC On July 25, 2016, the Company completed the acquisition of LogicMark. The Company determined that as of July 25, 2016, it was more likely than not that the gross profit targets as they relate to the contingent considerations would be achieved and any fair value adjustment of the earn-out was due to time value of the payout. On July 25, 2016, in order to fund part of the acquisition purchase price of LogicMark, the Company and a group of lenders, including ExWorks Capital Fund I, L.P. as agent for the lenders (collectively, the “Lenders”), entered into a Loan and Security Agreement (the “Loan Agreement”), whereby the Lenders extended a revolving loan (the “Revolving Loan”) to the Company in the principal amount of $15,000,000 (the “Debt Financing”). The Company incurred $1,357,356 in deferred debt issue costs related to the revolving loan. At June 30, 2017 the unamortized balance of those deferred debt issue costs was $87,179. The initial maturity date of the Revolving Loan was July 25, 2017, and the Revolving Loan bears interest at a rate of 15% per annum. The Loan Agreement contains customary covenants, including an EBITDA requirement and a fixed change ratio, as defined in the agreement. As of June 30, 2017, the Company was in compliance with such covenants. The Company has the ability to extend the Revolving Loan for two additional years at its sole discretion with no subjective acceleration by the lender, provided the Company is not in default on the loan. The Company exercised the option to extend the maturity date to July 25, 2018 and accordingly, the Company has classified the Revolving Loan as a non-current liability as of June 30, 2017 and December 31, 2016. On September 23, 2016, the Company entered into a forbearance agreement with LogicMark Investment Partners, LLC in connection with the LogicMark Note originally issued on July 22, 2016 in the amount of $2,500,000 which expired on September 22, 2016. The Company formally requested that the lender extend the LogicMark Note on September 20, 2016. As discussed below, the LogicMark Note was extended to July 15, 2017 pursuant to an amendment. Under the terms of the forbearance agreement, the LogicMark Sellers agreed to extend the maturity date of the LogicMark Note and the Company agreed to pay to the LogicMark Sellers in immediately available funds: (i) $250,000 on September 23, 2016; (ii) $100,000 on October 24, 2016; and (iii) $1,150,000, plus all accrued and unpaid interest due under the LogicMark Note on October 31, 2016. The Company also agreed to reduce the Escrow Amount (as defined in the Interest Purchase Agreement) by a total of $500,000, and to make certain other changes to the definition of “Escrow Amount” in the Purchase Agreement. The Company also agreed to make certain representations and warranties in respect of the LogicMark Seller’s forbearance. During June 2017, the Company paid down $250,000 of the LogicMark Note with cash generated from operations. The LogicMark Note originally was to mature on September 23, 2016 but was extended to July 15, 2017. In July 2017, the remaining balance of the LogicMark Note including the accrued interest owed was settled. See Note 9. Acquisition of Fit Pay As discussed in Note 1, the Company completed the “Merger” on May 23, 2017. Pursuant to the terms of the Merger Agreement, the aggregate purchase price paid for Fit Pay stock was: (i) 1,912,303 shares of common stock which was equivalent to 19.96% of the outstanding shares of common stock of the Company (the “Common Stock”); (ii) 2,000 shares of the Series C Non-Convertible Preferred Stock of the Company (the “Series C Preferred Stock”); (iii) the payment of certain debts by the Company; and (iv) the payment of certain unpaid expenses of the Fit Pay Sellers of $724,116 by the Company. In addition, the Company will be required to pay the Fit Pay Sellers an earn-out payment equal to 12.5% of the gross revenue derived from Fit Pay’s technology for sixteen (16) fiscal quarters commencing on October 1, 2017 and ending on December 31, 2021. To date, Fit Pay has had minimal revenue. The operating results of Fit Pay have been included in the condensed consolidated financial statements from the effective date of the acquisition, May 23, 2017. In connection with the merger on May 23, 2017, the Company recorded deferred tax liabilities of $1,797,476 as part of its preliminary purchase price allocation. As indicated below, the Company is in the process of completing its analysis of the fair value of the net assets acquired and the consideration granted and therefore the deferred tax liabilities recorded are considered preliminary and subject to change. Preliminary Allocation of Purchase Price of Fit Pay The Merger Agreement was accounted for under the acquisition method of accounting. The purchase price was preliminarily allocated to the tangible and identifiable assets acquired and liabilities assumed of Fit Pay based upon their estimated fair values. The excess purchase price over the fair value of the underlying net assets acquired was allocated to goodwill. The Company is in the process of completing its analysis of the fair value of the net assets acquired and the consideration granted through the use of an independent valuation firm and management’s preparation of estimates. Since the following information is based on preliminary assessments made by management, the acquisition accounting for Fit Pay is subject to final adjustment and it is possible that the final assessment of values may differ from the preliminary assessment. The following table summarizes the preliminary assessment of the estimated fair values of the identifiable assets acquired and liabilities assumed net of cash acquired, as of the date of acquisition of May 23, 2017. Cash $ 10,889 Accounts receivable 91,810 Other current assets 77,095 Property and equipment 31,967 Goodwill 7 ,954,260 Intangible assets (See Note 4) 5,245,400 Assets acquired 13,411,421 Accounts payable 165,650 Accrued liabilities 964 ,463 Customer deposits 286,948 Deferred taxes 1,797,476 Liabilities assumed 3, 214,537 Net assets acquired $ 10,196,884 Goodwill arising from the transaction consists of the expected operational synergies upon combining the entity and intangibles not qualifying for separate recognition. In connection with the Fit Pay transaction, the Company entered into an employment agreement with Michael Orlando, the former Chief Executive Officer of Fit Pay. Mr. Orlando will serve as the Chief Operating Officer of the Company and President of the wholly-owned subsidiary, Fit Pay, Inc. The term of the employment agreement is for one year and the employment agreement includes provisions for term extensions. In addition to Mr. Orlando’s salary, the employment agreement also provides for all necessary and reasonable out-of-pocket expenses incurred in the performance of his duties under the agreement, eligibility to participate in bonus or incentive compensation plans of the Company and eligibility to receive equity awards as determined by the board of directors. Pro Forma Financial Information The following table summarizes the unaudited pro forma financial information assuming that the acquisitions of LogicMark and Fit Pay occurred on January 1, 2016, and their respective results had been included in the Company’s financial results for the six and three months ended June 30, 2017 and June 30, 2016. The pro forma combined amounts are based upon available information and reflect a reasonable estimate of the effects of the LogicMark and Fit Pay acquisitions for the periods presented on the basis set forth herein. The following unaudited pro forma combined financial information is presented for informational purposes only and does not purport to represent what the financial position or results of operations would have been had the LogicMark and Fit Pay acquisitions in fact occurred on the date assumed, nor is it necessarily indicative of the results that may be expected in future periods. Six Months Ended Three Months Six Months Ended Three Months Ended June 30, 2017 June 30, 2016 (unaudited) (unaudited) Pro forma: Net Sales $ 14,431,446 $ 7,687,715 $ 7,476,084 $ 4,075,274 Net Loss applicable to Common Stockholders $ (3,760,809 ) $ (1,966,722 ) $ (11,800,016 ) $ (4,318,613 ) Net Loss Per Share - Basic and Diluted applicable to Common Stockholders $ (0.41 ) $ (0.19 ) $ (1.55 ) $ (0.54 ) The unaudited pro forma net loss attributable to Nxt-ID, Inc. has been calculated using actual historical information and is adjusted for certain pro forma adjustments based on the assumption that the acquisitions of LogicMark and Fit Pay and the application of fair value adjustments to intangible assets occurred on January 1, 2016. For the three and six months ended June 30, 2017, the pro forma financial information excluded the Fit Pay acquisition-related expenses of $110,140 and $122,817, respectively, which are included in the actual reported results, as general and administrative expenses, but excluded from the pro forma amounts above due to their nonrecurring nature. In addition, the pro forma adjustments for the three and six months ended June 30, 2017 include the following adjustments, (a) amortization expense related to the acquired intangible assets of $105,833 and $289,066, respectively; (b) interest expense of $77,416 and $211,406, respectively; and (c) dividends related to the Series C preferred stock of $14,247 and $38,904, respectively. For the three and six months ended June 30, 2016, the pro forma financial information reflects the following adjustments, (a) the exclusion of the acquisition-related expenses of $333,518; (b) amortization of the inventory fair value adjustment of $nil and $945,212, respectively; (c) reduction in depreciation expense of $6,608 and $13,216, respectively; (d) amortization expense related to the acquired intangible assets of $374,764 and $745,410, respectively; (e) interest expense including the amortization of deferred debt issue costs of $1,441,506 and $2,867,617, respectively; and (f) dividends related to the Series B and Series C preferred stock of $306,182 and $612,089, respectively.

Strategic Agreements with World

Strategic Agreements with World Ventures Holdings	6 Months Ended
	Jun. 30, 2017
Strategic Agreements with World Ventures Holdings [Abstract]
STRATEGIC AGREEMENTS WITH WORLD VENTURES HOLDINGS	Note 6 – Strategic Agreements with world ventures holdings The Company is a party to a Master Product Development Agreement with World Ventures Holdings, LLC, a related party. During the six and three months ended June 30, 2017, the Company recorded revenue of $6,289,281 and $3,581,245, respectively related to WVH. At June 30, 2017, the Company’s accounts receivable balance included $1,797,941 due from WVH.

Stockholders' Equity

Stockholders' Equity	6 Months Ended
	Jun. 30, 2017
Stockholders' Equity [Abstract]
STOCKHOLDERS' EQUITY	Note 7 - Stockholders’ Equity Series A Preferred Stock For the six and three months ended June 30, 2017, the Company recorded Series A Preferred Stock dividends of $34,884 and $3,489, respectively. During the six months ended June 30, 2017 holders of 100,899 shares of Series A Preferred Stock converted $197,105 of Series A Preferred Stock and dividends into 83,876 shares of common stock. As of June 30, 2017 the outstanding principal balance on the Series A Preferred Stock was $110,525. Series B Preferred Stock For the six and three months ended June 30, 2017, the Company recorded Series B Preferred Stock dividends of $562,500 and $281,250, respectively. During the six months ended June 30, 2017 holders of 3,589,838 shares of Series B Preferred Stock converted $4,846,286 of Series B Preferred Stock, dividends and liquidated damages into 2,433,619 shares of common stock. As of June 30, 2017 the outstanding principal balance on the Series B Preferred Stock was $910,162. Series C Preferred Stock In May 2017, the Company authorized a new Series C Preferred Stock. The terms of the Series C Preferred Stock are as follows: Ranking The Series C Preferred Stock will rank junior to our Series A Preferred Stock, $0.0001 par value per share, and our Series B Preferred, $0.0001 par value per share with respect to dividend rights and/or rights upon distributions, liquidation, dissolution or winding up of the Company. Dividends on Series C Preferred Stock Holders of Series C Preferred Stock shall be entitled to receive from, from and after the first date of issuance of the Series C Preferred Stock, cumulative dividends at a rate of 5% per annum on a compounded basis, which dividend amount shall be guaranteed. Accrued and unpaid dividends shall be payable in cash. For the six and three months ended June 30, 2017, the Company recorded Series C Preferred Stock dividends of Redemption of Series C Preferred Stock The Series C Preferred Stock may be redeemed by the Company solely at the Company’s option in cash at any time, in whole or in part, upon payment of the stated value of the Series C Preferred Stock, and all related accrued but unpaid dividends. Fundamental Change If a “fundamental change” occurs at any time while the Series C Preferred Stock is outstanding, the holders of shares of Series C Preferred Stock then outstanding shall be immediately paid, out of the assets of the Company or the proceeds of such fundamental change, as applicable, and legally available for distribution to its stockholders, an amount in cash equal to the stated value of the Series C Preferred Stock, and all related accrued but unpaid dividends. If the legally available assets of the Company and the proceeds of such “fundamental change” are insufficient to pay the all of the Holders of the Series C Preferred Stock, then the Holders of the Series C Preferred Stock shall share ratably in any such distribution in proportion to the amount that they would have been entitled to. A fundamental change includes but is not limited to any change in the ownership of at least 50% of the voting stock; liquidation or dissolution; or the Common Stock ceases to be listed on the market upon which it currently trades. Voting Rights The holders of the Series C Preferred Stock shall be entitled to vote on any matter submitted to the stockholders of the Company for a vote. One (1) share of Series C Preferred Stock shall carry the same voting rights as one (1) share of Common Stock. Classification The Series C Preferred Stock was accounted for under Section 480-10-S99 - Distinguishing Liabilities from Equity (FASB Accounting Standards Codification 480) as amended by ASU 2009-04 - for Redeemable Equity Instruments (“ASU 2009-04”). Under ASU 2009-04, a redeemable equity security is to be classified as temporary equity if it is conditionally redeemable upon the occurrence of an event that is not solely within the control of the issuer. The Company’s financing is redeemable at the option of the holder under the specified terms and conditions of such preferred stock however, the instrument was not redeemable as of June 30, 2017. Therefore, the Company classified the Series C Preferred Stock as temporary equity in the condensed consolidated balance sheet at June 30, 2017. Long-Term Stock Incentive Plan On January 4, 2013, a majority of the Company’s stockholders approved by written consent the Company’s 2013 Long-Term Stock Incentive Plan (“LTIP”). The maximum aggregate number of shares of common stock that may be issued under the LTIP, including stock awards, stock issued to directors for serving on the Company’s board, and stock appreciation rights, is limited to 10% of the shares of Common Stock outstanding on the first business or trading day of any fiscal year, which is 737,992 at January 1, 2017. During the six months ended June 30, 2017, the Company accrued $300,000 of discretionary management and employee bonus expense. During the six months ended June 30, 2017, the Company issued 55,754 fully-vested shares of common stock with a fair value of $102,395 to non-employees for services rendered.

Commitments and Contingencies

Commitments and Contingencies	6 Months Ended
	Jun. 30, 2017
Commitments and Contingencies [Abstract]
COMMITMENTS AND CONTINGENCIES	Note 8 - Commitments and Contingencies Legal Matters From time to time we may be involved in various claims and legal actions arising in the ordinary course of our business. There is no action, suit, proceeding, inquiry or investigation before or by any court, public board, government agency, self-regulatory organization or body pending or, to the knowledge of the executive officers of our company or any of our subsidiaries, threatened against or affecting our company, or any of our subsidiaries in which an adverse decision could have a material adverse effect upon our business, operating results, or financial condition. Commitments The Company is a party to certain leases for office space and warehouse facilities, with monthly payments ranging from $1,750 to $8,850, expiring on various dates through August 2020. The Company incurred rent expense of $93,503 and $64,879 for the six months ended June 30, 2017 and June 30, 2016, respectively. Minimum future lease payments for non-cancelable operating leases are as follows: 2017 $ 100,424 2018 110,867 2019 112,015 2020 65,235 Total future lease obligations $ 388,541 The maturity of the Company’s debt over each of the next four years ending May 19, 2021 is as follows : 2017 $ 523,969 2018 266,200 2019 212,961 2020 212,961 2021 159,719 Total debt $ 1,375,810

Subsequent Events

Subsequent Events	6 Months Ended
	Jun. 30, 2017
Subsequent Events [Abstract]
SUBSEQUENT EVENTS	Note 9 – Subsequent Events The Company evaluates events that have occurred after the balance sheet date but before the financial statements are issued. On July 3, 2017, the Company issued 11,500 shares of its common stock for the payment of services with a grant date fair value of $22,540. On July 5, 2017, a purchaser of the Series A Preferred Stock converted an aggregate $141,644 of Series A Preferred Stock and dividends into 75,343 shares of common stock. On July 3, 2017 through July 14, 2017, purchasers of the Series B Preferred Stock converted an aggregate $1,265,581 of Series B Preferred Stock, dividends and liquidated damages into 673,183 shares of common stock. Subsequent to these conversions, there is no longer any Series B Preferred Stock On July 13, 2017, the Company closed a registered direct offering of an aggregate of 2,170,000 shares of the Company’s common stock, and pre-funded warrants to purchase 230,000 shares of common stock. The Company sold the shares at a price of $1.43 per share and received $1.42 per pre-funded warrant. The Company received gross proceeds from the offering, before deducting placement agent fees and other estimated offering expenses payable by the Company, of approximately $3,429,700. On July 13, 2017, the Company also closed on a concurrent private placement with the same investors for no additional consideration, of warrants to purchase 1,800,000 shares of common stock. In order to consummate the registered direct offering and concurrent private placement, the Company was required to obtain consent from the holders (the “November Holders”) of the Company’s (i) Amended and Restated Secured Subordinated Promissory Notes, originally issued on July 25, 2016, and amended on November 29, 2016 (the “November Notes”), and (ii) certain common stock purchase warrants (the “November Warrants”) that are initially exercisable on November 29, 2016. In consideration of the November Holders providing such consent to the registered direct offering and concurrent private placement, the Company and the November Holders agreed, as of July 11, 2017, to the following additional amendments to their respective November Notes, November Warrants, and that certain Exchange Agreement, dated November 29, 2016 (the “Exchange Agreement”): 1. The conversion price of the November Notes was lowered from $3.00 to $2.00. 2. The exercise price of the November Warrants was lowered from $3.00 to $2.00. 3. The Company’s prohibition under the Exchange Agreement providing that for so long as the November Holders are holders of the November Notes, the November Warrants, or the shares of Common Stock issuable thereunder, the Company may not issue shares of our Common Stock at a price per share less than $3.00 per share, was lowered to $2.00 per share. On July 19, 2017, the November Holders purchased from LogicMark Investment Partners, LLC (“LogicMark Investment Partners”), the representative of LogicMark, LLC, the outstanding balance of $594,403, including accrued and unpaid interest on the LogicMark Note. In connection therewith, the Company, LogicMark Investment Partners and the November Holders entered into an Assignment and Assumption Agreement, dated July 19, 2017, pursuant to which LogicMark Investment Partners assigned the LogicMark Note to the November Holders. In addition, on July 19, 2017, the Company and the November Holders entered into a Securities Exchange Agreement pursuant to which the Company exchanged the LogicMark Note held by the November Holders for (i) an aggregate principal amount of $594,403 of secured subordinated convertible promissory notes of the Company (the “July 2017 Notes”) due in July 2018, and (ii) warrants exercisable into 297,202 shares of Common Stock (the “July 2017 Warrants”). The July 2017 Notes are convertible into shares of Common Stock at a conversion price of $2.00 per share and the July 2017 Warrants are exercisable into shares of Common Stock with a five year term and an exercise price of $2.00 per share.

Summary of Significant Accoun15

Summary of Significant Accounting Policies (Policies)	6 Months Ended
	Jun. 30, 2017
Summary of Significant Accounting Policies [Abstract]
USE OF ESTIMATES IN THE FINANCIAL STATEMENTS	Use of Estimates in the Financial Statements The preparation of financial statements in conformity with 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 date of the financial statements and the reported amounts of revenues and expenses during the reporting period. The Company’s management evaluates these significant estimates and assumptions including those related to the fair values of acquired assets and liabilities assumed in business combinations stock based compensation, derivative financial instruments, income taxes and related valuation allowances, accounts receivable and inventory, and other matters that affect the condensed consolidated financial statements and disclosures. Actual results could differ from those estimates.
PRINCIPLES OF CONSOLIDATION	Principles of consolidation The condensed consolidated financial statements include the accounts of Nxt-ID and its wholly-owned subsidiaries, 3D-ID, LogicMark and Fit Pay. Intercompany balances and transactions have been eliminated in consolidation.
CONCENTRATIONS OF CREDIT RISK	Concentrations of Credit Risk During the six and three months ended June 30, 2017, the Company recognized revenue of $6,289,281 and $3,581,245 respectively, from World Ventures Holdings, LLC (“WVH”), a related party based on its position as the Company’s largest stockholder. At June 30, 2017, the Company’s accounts receivable balance included $1,797,941 due from WVH.
REVENUE RECOGNITION	Revenue Recognition The Company recognizes revenue from product sales when persuasive evidence of an arrangement exists, the service has been rendered or product delivery has occurred, the price is fixed or readily determinable and collectability of the sale is reasonably assured.
ACCOUNTS RECEIVABLE	Accounts Receivable Accounts receivable is stated at net realizable value. The Company regularly reviews accounts receivable balances and adjusts the receivable reserves as necessary whenever events or circumstances indicate the carrying value may not be recoverable. The Company had no allowance for doubtful accounts at June 30, 2017, and December 31, 2016.
INVENTORY	Inventory The Company performs regular reviews of inventory quantities on hand and evaluates the realizable value of its inventories. The Company adjusts the carrying value of the inventory as necessary with estimated valuation reserves for excess, obsolete, and slow-moving inventory by comparing the individual inventory parts to forecasted product demand or production requirements. As of June 30, 2017 inventory was comprised of $3,914,501 in raw materials and $1,343,149 in finished goods on hand. Inventory at December 31, 2016 was comprised of $3,797,499 in raw materials and $1,544,001 in finished goods on hand. The Company is required to prepay for raw materials with certain vendors until credit terms can be established. As of June 30, 2017, and December 31, 2016, the Company had prepaid inventory of $1,126,701 and $1,089,770, respectively. These prepayments were made primarily for raw materials inventory and prepaid inventory is included in prepaid expenses and other current assets on the condensed consolidated balance sheet.
GOODWILL	Goodwill The Company’s goodwill relates to the acquisitions of LogicMark and Fit Pay. The Company will begin testing goodwill for impairment annually in the third quarter of each year using data as of August 1 of that year. Authoritative accounting guidance allows the Company to first assess qualitative factors to determine whether it is necessary to perform the more detailed two-step quantitative goodwill impairment test. The Company performs the quantitative test if its qualitative assessment determined it is more likely than not that a reporting unit’s fair value is less than its carrying amount. The Company may elect to bypass the qualitative assessment and proceed directly to the quantitative test for any reporting units or assets. The quantitative goodwill impairment test, if necessary, is a two-step process. The first step is to identify the existence of a potential impairment by comparing the fair value of a reporting unit (the estimated fair value of a reporting unit is calculated using a discounted cash flow model) with its carrying amount, including goodwill. If the fair value of a reporting unit exceeds its carrying amount, the reporting unit’s goodwill is considered not to be impaired and performance of the second step of the quantitative goodwill impairment test is unnecessary. However, if the carrying amount of a reporting unit exceeds its fair value, the second step of the quantitative goodwill impairment test is performed to measure the amount of impairment loss to be recorded, if any. The second step of the quantitative goodwill impairment test compares the implied fair value of the reporting unit’s goodwill with the carrying amount of that goodwill. If the carrying amount of the reporting unit’s goodwill exceeds its implied fair value, an impairment loss is recognized in an amount equal to that excess. The implied fair value of goodwill is determined using the same approach as employed when determining the amount of goodwill that would be recognized in a business combination. That is, the fair value of the reporting unit is allocated to all of its assets and liabilities as if the reporting unit had been acquired in a business combination and the fair value was the purchase price paid to acquire the reporting unit.
OTHER INTANGIBLE ASSETS	Other Intangible Assets The Company’s intangible assets are all related to the acquisitions of LogicMark and FitPay and are included in other intangible assets in the Company’s condensed consolidated balance sheets at June 30, 2017 and December 31, 2016. At June 30, 2017, the other intangible assets related to the acquisition of LogicMark are comprised of patents of $3,751,780; trademarks of $1,198,822; and customer relationships of $2,957,346. At December 31, 2016, the other intangible assets are comprised of patents of $3,936,612; trademarks of $1,230,002; and customer relationships of $3,119,111. The Company will continue amortizing these intangible assets using the straight line method over their estimated useful lives which for the patents, trademarks and customer relationships are 11 years; 20 years; and 10 years, respectively. During the six and three months ended June 30, 2017, the Company had amortization expense of $377,777 and $189,932, respectively related to the LogicMark intangible assets. At June 30, 2017, the other intangible assets related to the acquisition of Fit Pay, As of June 30, 2017, amortization expense estimated for the remainder of fiscal year 2017 related to both the LogicMark and Fit Pay intangibles is approximately $755,000 and for each of the next five fiscal years, 2018 through 2022, the amortization expense is estimated to be approximately $1,505,000 per year.
STOCK-BASED COMPENSATION	Stock-Based Compensation The Company accounts for share-based awards exchanged for employee services at the estimated grant date fair value of the award. The Company accounts for equity instruments issued to non-employees at their fair value on the measurement date. The measurement of stock-based compensation is subject to periodic adjustment as the underlying equity instrument vests or becomes non-forfeitable. Non-employee stock-based compensation charges are amortized over the vesting period or as earned. The Company generally issues new shares of common stock to satisfy conversion and warrant exercises.
Net Loss per Share	Net Loss per Share Basic loss per share was computed using the weighted average number of common shares outstanding. Diluted loss per share includes the effect of diluted common stock equivalents. Potentially dilutive securities of 546,003 realizable from the Series A Preferred Stock and Series B Preferred Stock (as defined in Note 7), and 575,000 from the convertible notes and from the exercise of 1,829,049 warrants as of June 30, 2017 were excluded from the computation of diluted net loss per share because the effect of their inclusion would have been anti-dilutive for the six and three months ended June 30, 2017. As of June 30, 2016, potentially dilutive securities from the conversion of convertible notes of $515,731 and related accrued interest and from the exercise of warrants into 9,140,293 shares of Common Stock were excluded from the computation of diluted net loss per share because the effect of their inclusion would have been anti-dilutive.
RECENT ACCOUNTING PRONOUNCEMENTS	Recent Accounting Pronouncements In March 2016, the FASB issued ASU No. 2016-09 (“ASU 2016-09”), “Compensation—Stock Compensation (Topic 718): Improvements to Employee Share-Based Payment Accounting.” ASU 2016-09 will affect all entities that issue share-based payment awards to their employees and is effective for annual periods beginning after December 15, 2016 for public entities. The areas for simplification in ASU 2016-09 involve several aspects of the accounting for share-based payment transactions, including the income tax consequences, classification of awards as either equity or liabilities, and classification on the statement of cash flows. The Company adopted this standard in the first quarter of 2017 and it did not have a material impact on its condensed consolidated financial statements. In May 2016, the FASB issued ASU No. 2016-12 (“ASU 2016-12”), “Revenue from Contracts with Customers (Topic 606): Narrow- Scope Improvements and Practical Expedients.” ASU 2016-12 will affect all entities that enter into contracts with customers to transfer goods or services (that are an output of the entity’s ordinary activities) in exchange for consideration. The amendments in this update affect the guidance in ASU 2014-09 which is not yet effective, the amendments in this update affect narrow aspects of Topic 606 including among others: assessing collectability criterion, noncash consideration, and presentation of sales taxes and other similar taxes collected from customers. The effective date and transition requirements for the amendments in this update are the same as the effective date and transition requirements for ASU 2014-09. The Company is currently evaluating the effect that ASU 2016-12 will have on the Company’s condensed consolidated financial position and results of operations. In January 2017, the FASB issued ASU No. 2017-01, “Business Combinations (Topic 805): Clarifying the Definition of a Business.” The amendments in this update clarify the definition of a business with the objective of adding guidance to assist entities with evaluating whether transactions should be accounted for as acquisitions (or disposals) of businesses. The amendments in this update provide a screen to determine when a set is not a business. If the screen is not met, it (1) requires that to be considered a business, a set must include, at a minimum, an input and a substantive process that together significantly contribute to the ability to create output and (2) removes the evaluation of whether a market participant could replace the missing elements. The amendments in this Update are effective for all entities for annual periods, and interim periods within those annual periods, beginning after December 15, 2017. Early adoption is permitted. This iASU is not expected to have a material impact on the Company’s condensed consolidated financial statements. In May 2017, the FASB issued ASU 2017-09, “Compensation—Stock Compensation (Topic 718): Scope of Modification Accounting” to provide clarity and reduce both (1) diversity in practice and (2) cost and complexity when applying the guidance in Topic 718, Compensation—Stock Compensation, to a change to the terms or conditions of a share-based payment award. The amendments in this Update provide guidance about which changes to the terms or conditions of a share-based payment award require an entity to apply modification accounting in Topic 718. The amendments in this Update are effective for all entities for annual periods, and interim periods within those annual periods, beginning after December 15, 2017. Early adoption is permitted. This ASU is not expected to have a material impact on the Company’s condensed consolidated financial statements.

Acquisitions (Tables)

Acquisitions (Tables)	6 Months Ended
	Jun. 30, 2017
Acquisitions [Abstract]
Schedule of estimated fair values of identifiable assets acquired and liabilities assumed	Cash $ 10,889 Accounts receivable 91,810 Other current assets 77,095 Property and equipment 31,967 Goodwill 7 ,954,260 Intangible assets (See Note 4) 5,245,400 Assets acquired 13,411,421 Accounts payable 165,650 Accrued liabilities 964 ,463 Customer deposits 286,948 Deferred taxes 1,797,476 Liabilities assumed 3, 214,537 Net assets acquired $ 10,196,884
Summary of proforma of financial position or results of operations	Six Months Ended Three Months Six Months Ended Three Months Ended June 30, 2017 June 30, 2016 (unaudited) (unaudited) Pro forma: Net Sales $ 14,431,446 $ 7,687,715 $ 7,476,084 $ 4,075,274 Net Loss applicable to Common Stockholders $ (3,760,809 ) $ (1,966,722 ) $ (11,800,016 ) $ (4,318,613 ) Net Loss Per Share - Basic and Diluted applicable to Common Stockholders $ (0.41 ) $ (0.19 ) $ (1.55 ) $ (0.54 )

Commitments and Contingencies (

Commitments and Contingencies (Tables)	6 Months Ended
	Jun. 30, 2017
Commitments and Contingencies [Abstract]
Schedule of future lease obligation	2017 $ 100,424 2018 110,867 2019 112,015 2020 65,235 Total future lease obligations $ 388,541
Schedule of maturity dept of next four years	2017 $ 523,969 2018 266,200 2019 212,961 2020 212,961 2021 159,719 Total debt $ 1,375,810

Organization and Basis of Pre18

Organization and Basis of Presentation (Details) - USD ($)	Sep. 23, 2016	Jul. 25, 2016	Jul. 31, 2017	Jun. 30, 2017	Dec. 31, 2016
Organization and Basis of Presentation (Textual)
Payments to LogicMark sellers, description		(i) $1,500,000 for calendar year 2016 and (ii) and may be required to pay the LogicMark Sellers an earn-out payment of up to $5,000,000 for calendar year 2017 if LogicMark meets certain gross profit targets set forth in the Interest Purchase Agreement. The secured subordinated promissory note originally issued to LogicMark Investment Partners on July 25, 2016 and amended on November 29, 2016 (the "LogicMark Note") was to mature on September 23, 2016 but was extended to April 15, 2017 and then extended to July 15, 2017. The Company and the LogicMark Sellers also agreed to extend the due date on the 2016 earn-out payment to July 15, 2017.As of June 30, 2017, the 2016 earn-out payment and principal and interest due on the LogicMark Note amount to an aggregate of $1,500,000 and $591,783, respectively, and have been included as a component of current liabilities on the condensed consolidated balance sheet as of June 30, 2017.
Convertible notes payable, Maturity date	Sep. 23, 2016	Sep. 22, 2016
Aggregate amount		$ 15,000,000
Current liabilities				$ 6,600,733	$ 1,496,442
LogicMark, LLC [Member]
Organization and Basis of Presentation (Textual)
Aggregate amount				$ 1,500,000
LogicMark, LLC [Member] | Subsequent Event [Member]
Organization and Basis of Presentation (Textual)
Payments to LogicMark sellers, description			The Company paid the 2016 earn-out payment in the amount of $1,500,000 to the LogicMark Sellers. In addition, in July 2017, the remaining balance of $594,403 owed on the LogicMark Note, including accrued and unpaid interest, , was purchased by certain investors in exchange for $594,403 in principal amount of convertible notes of the Company and warrants exercisable for 297,202 shares of Common Stock.

Reverse Stock Split (Details)

Reverse Stock Split (Details)	6 Months Ended
	Jun. 30, 2017
Reverse Stock Split [Abstract]
Reverse stock split, description	On September 1, 2016, the Company's board of directors and stockholders approved a resolution to amend the Company's Certificate of Incorporation and to authorize the Company to effect a reverse split of the Company's outstanding common stock at a ratio of 1-for-10 (the "Reverse Split"). On September 9, 2016, the Company effected the Reverse Split. Upon effectiveness of the Reverse Split, every 10 shares of outstanding common stock decreased to one share of common stock. Throughout this report, the Reverse Split was retroactively applied to all periods presented.

Liquidity and Management Plans

Liquidity and Management Plans (Details) - USD ($)	3 Months Ended		6 Months Ended
	Jun. 30, 2017	Jun. 30, 2016	Jun. 30, 2017	Jun. 30, 2016	Dec. 31, 2016
Liquidity and Management Plans (Textual)
Operating profit	$ 666,401	$ (2,306,734)	$ 1,733,303	$ (4,634,017)
Net Loss	(1,199,317)	$ (2,509,576)	(1,929,532)	$ (7,921,272)
Working capital deficiency	7,644,184		7,644,184
Stockholders' equity	5,598,260		5,598,260		$ 2,818,731
Contingent consideration	$ 6,600,733		$ 6,600,733		$ 1,496,442

Summary of Significant Accoun21

Summary of Significant Accounting Policies (Details) - USD ($)	1 Months Ended	3 Months Ended	6 Months Ended
	May 23, 2017	Jun. 30, 2017	Jun. 30, 2017	Jun. 30, 2016	Dec. 31, 2016
Summary of Significant Accounting Policies (Textual)
Inventory raw materials		$ 3,914,501	$ 3,914,501		$ 3,797,499
Inventory finished goods		1,343,149	1,343,149		1,544,001
Prepaid inventory		1,126,701	$ 1,126,701		1,089,770
Antidilutive earnings per share, shares			546,003
Intangible assets	$ 5,245,400
Amortization of intangible assets		189,932	$ 457,152
Amortization expense estimated for remainder of fiscal 2017		755,000	755,000
Amortization expense estimated for 2018		1,505,000	1,505,000
Amortization expense estimated for 2019		1,505,000	1,505,000
Amortization expense estimated for 2020		1,505,000	1,505,000
Amortization expense estimated for 2021		1,505,000	1,505,000
Amortization expense estimated for 2022		1,505,000	$ 1,505,000
Patents [Member]
Summary of Significant Accounting Policies (Textual)
Other intangible assets, estimated useful lives			11 years
Patents		3,751,780	$ 3,751,780		3,936,612
Trademarks [Member]
Summary of Significant Accounting Policies (Textual)
Other intangible assets, estimated useful lives	25 years		20 years
Trademarks	$ 396,299	1,198,822	$ 1,198,822		1,230,002
Customer Relationships [Member]
Summary of Significant Accounting Policies (Textual)
Other intangible assets, estimated useful lives	6 years		10 years
Customer relationships	$ 1,421,624	2,957,346	$ 2,957,346		$ 3,119,111
Technology [Member]
Summary of Significant Accounting Policies (Textual)
Other intangible assets, estimated useful lives	7 years
Technology	$ 3,348,102
FitPay intangible assets [Member]
Summary of Significant Accounting Policies (Textual)
Amortization of intangible assets		79,375	$ 73,297
Convertible Notes [Member]
Summary of Significant Accounting Policies (Textual)
Antidilutive earnings per share, shares			575,000
Conversion of convertible notes				$ 515,731
WVH [Member]
Summary of Significant Accounting Policies (Textual)
Sales revenue		3,581,245	$ 6,289,281
Accounts receivable due from WVH		$ 1,797,941	$ 1,797,941
Warrants [Member]
Summary of Significant Accounting Policies (Textual)
Antidilutive earnings per share, shares			1,829,049
Common stock, shares				9,140,293

Acquisitions (Details)

Acquisitions (Details)	May 23, 2017USD ($)
Acquisitions [Abstract]
Cash	$ 10,889
Accounts receivable	91,810
Other current assets	77,095
Property and equipment	31,967
Goodwill	7,954,260
Intangible assets (See Note 4)	5,245,400
Assets acquired	13,411,421
Accounts payable	165,650
Accrued liabilities	964,463
Customer deposits	286,948
Deferred taxes	1,797,476
Liabilities assumed	3,214,537
Net assets acquired	$ 10,196,884

Acquisitions (Details 1)

Acquisitions (Details 1) - USD ($)	3 Months Ended		6 Months Ended
	Jun. 30, 2017	Jun. 30, 2016	Jun. 30, 2017	Jun. 30, 2016
Pro forma:
Net Sales	$ 7,687,715	$ 4,075,274	$ 14,431,446	$ 7,476,084
Net Loss applicable to Common Stockholders	$ (1,966,722)	$ (4,318,613)	$ (3,760,809)	$ (11,800,016)
Net Loss Per Share - Basic and Diluted applicable to Common Stockholders	$ (0.19)	$ (0.54)	$ (0.41)	$ (1.55)

Acquisitions (Details Textual)

Acquisitions (Details Textual) - USD ($)	Sep. 23, 2016	Jul. 25, 2016	Jul. 22, 2016	Jun. 30, 2017	Jun. 30, 2016	Jun. 30, 2017	Jun. 30, 2016	May 23, 2017	Dec. 31, 2016
Acquisitions (Textual)
Debt issuance costs						$ 1,357,356
Interest expense				$ 77,416		211,406
Unamortized balance of deferred debt issue costs				87,179		87,179
Prime borrowing rate		15.00%
Notes payable, Maturity date	Sep. 23, 2016	Sep. 22, 2016
Debt instrument principal amount		$ 15,000,000
Forbearance agreement, description	i) $250,000 on September 23, 2016; (ii) $100,000 on October 24, 2016; and (iii) $1,150,000, plus all accrued and unpaid interest due under the LogicMark Note on October 31, 2016.
Escrow amount	$ 500,000
Amortization expense related intangible assets				$ 105,833	$ 374,764	$ 289,066	$ 745,410
Amortization deferred debt issuance costs					1,441,506		2,867,617
Reduction depreciation expense					6,608		13,216
Amortization of inventory fair value adjustment							945,212
Note originally issued amount			$ 2,500,000
Description of merger agreement						(i) 1,912,303 shares of common stock which was equivalent to 19.96% of the outstanding shares of common stock of the Company (the “Common Stock”); (ii) 2,000 shares of the Series C Non-Convertible Preferred Stock of the Company (the “Series C Preferred Stock”); (iii) the payment of certain debts by the Company; and (iv) the payment of certain unpaid expenses of the FitPay Sellers of $724,116 by the Company. In addition, the Company will be required to pay the Fit Pay Sellers an earn-out payment equal to 12.5% of the gross revenue derived from Fit Pay’s technology for sixteen (16) fiscal quarters commencing on October 1, 2017 and ending on December 31, 2021. To date, FitPay has had minimal revenue. The operating results of Fit Pay have been included in the condensed consolidated financial statements from the effective date of the acquisition, May 23, 2017.
Convertible preferred stock par value				$ 0.0001		$ 0.0001			$ 0.0001
Acquisition related expenses				$ 110,140	333,518	$ 122,817	333,518
LogicMark note payments						$ 250,000
Deferred tax liabilities								$ 1,797,476
Series A Convertible Preferred Stock [Member]
Acquisitions (Textual)
Convertible preferred stock par value				$ 0.0001		$ 0.0001			0.0001
Series B Convertible Preferred Stock [Member]
Acquisitions (Textual)
Dividends related cost					$ 306,182
Convertible preferred stock par value				$ 0.0001		$ 0.0001			$ 0.0001
Series C Preferred Stock [Member]
Acquisitions (Textual)
Dividends related cost				$ 14,247		$ 38,904	$ 612,089
Revolving Credit Facility [Member]
Acquisitions (Textual)
Notes payable, Maturity date		Jul. 25, 2017

Strategic Agreements with Wor25

Strategic Agreements with World Ventures Holdings (Details) - WVH [Member]	3 Months Ended	6 Months Ended
	Jun. 30, 2017USD ($)	Jun. 30, 2017USD ($)
Strategic Agreements with World Ventures Holdings (Textual)
Revenue	$ 3,581,245	$ 6,289,281
Accounts receivable due from WVH	$ 1,797,941	$ 1,797,941

Stockholders' Equity (Details)

Stockholders' Equity (Details)	3 Months Ended	6 Months Ended
	Jun. 30, 2017USD ($)$ / sharesshares	Jun. 30, 2017USD ($)directors$ / sharesshares	Dec. 31, 2016$ / sharesshares
Stockholders' Equity (Textual)
Convertible preferred stock par value | $ / shares	$ 0.0001	$ 0.0001	$ 0.0001
Shares issued under stock incentive plan, shares		507,414
Restricted stock expense | $		$ 52,500
Discretionary management and employee bonus expense | $		$ 300,000
Minimum ownership percentage of voting stock	50.00%	50.00%
Non-executive employee [Member]
Stockholders' Equity (Textual)
Common stock shares for fully-vested services rendered		55,754
Common stock fair value for fully-vested services rendered | $		$ 102,395
Series A Preferred Stock [Member]
Stockholders' Equity (Textual)
Convertible preferred stock par value | $ / shares	$ 0.0001	$ 0.0001	$ 0.0001
Preferred stock dividend | $	$ 3,489	$ 34,884
Preferred stock dividend into shares		83,876
Preferred stock, shares outstanding	110,525	110,525	211,424
Conversion of stock, converted | $		$ 197,105
Conversion of stock, converted shares		100,899
Series B Preferred Stock [Member]
Stockholders' Equity (Textual)
Convertible preferred stock par value | $ / shares	$ 0.0001	$ 0.0001	$ 0.0001
Preferred stock dividend | $	$ 281,250	$ 562,500
Preferred stock dividend into shares		2,433,619
Preferred stock, shares outstanding	910,162	910,162	4,500,000
Conversion of stock, converted | $		$ 4,846,286
Conversion of stock, converted shares		3,589,838
Series C Preferred Stock [Member]
Stockholders' Equity (Textual)
Preferred stock dividend | $	$ 10,685	$ 10,685
Cumulative dividend rate		5.00%
Long-Term Stock Incentive Plan [Member]
Stockholders' Equity (Textual)
Number of common stock issued		230,587
Long-term stock incentive plan, description		The maximum aggregate number of shares of common stock that may be issued under the LTIP, including stock awards, stock issued to directors for serving on the Company's board, and stock appreciation rights, is limited to 10% of the shares of Common Stock outstanding on the first business or trading day of any fiscal year, which is 737,992 at January 1, 2017.
Long-Term Stock Incentive Plan [Member] | Non-executive directors [Member]
Stockholders' Equity (Textual)
Shares issued under stock incentive plan, shares		85,908
Shares issued under stock incentive plan | $		$ 160,000
Number of employees under stock incentive plan | directors		5
Long-Term Stock Incentive Plan [Member] | Executive Officer [Member]
Stockholders' Equity (Textual)
Shares issued under stock incentive plan, shares		237,559
Shares issued under stock incentive plan | $		$ 400,000
Restricted shares vesting period description		The vesting period for these restricted shares of common stock is thirty-six months.
Long-Term Stock Incentive Plan [Member] | Non-executive employee [Member]
Stockholders' Equity (Textual)
Shares issued under stock incentive plan, shares		237,559
Shares issued under stock incentive plan | $		$ 400,000
Restricted shares vesting period description		The vesting period for these restricted shares of common stock is thirty-six months.

Commitments and Contingencies27

Commitments and Contingencies (Details)	Jun. 30, 2017USD ($)
Commitments and Contingencies [Abstract]
2,017	$ 100,424
2,018	110,867
2,019	112,015
2,020	65,235
Total future lease obligations	$ 388,541

Commitments and Contingencies28

Commitments and Contingencies (Details 1)	Jun. 30, 2017USD ($)
Commitments and Contingencies [Abstract]
2,017	$ 523,969
2,018	266,200
2,019	212,961
2,020	212,961
2,021	159,719
Total debt	$ 1,375,810

Commitments and Contingencies29

Commitments and Contingencies (Details Textual) - USD ($)	6 Months Ended
	Jun. 30, 2017	Jun. 30, 2016
Commitments and Contingencies (Textual)
Rent expenses	$ 95,503	$ 64,879
Office Space [Member]
Commitments and Contingencies (Textual)
Lease expiration date	Aug. 31, 2020
Office Space [Member] | Minimum [Member]
Commitments and Contingencies (Textual)
Monthly rent amount	$ 1,750
Office Space [Member] | Maximum [Member]
Commitments and Contingencies (Textual)
Monthly rent amount	$ 8,850

Subsequent Events (Details)

Subsequent Events (Details) - Subsequent Event [Member] - USD ($)	Jul. 14, 2017	Jul. 05, 2017	Jul. 03, 2017	Jul. 19, 2017	Jul. 13, 2017
Subsequent Events (Textual)
Stock issued during the period shares issued for services, shares			11,500
Stock issued during the period shares issued for services, value			$ 22,540
Warrants purchase of common stock, shares					1,800,000
Sale of stock share price					$ 1.43
Conversion price				$ 2
Warrant exercise price				$ 2
Debt instrument, Description				(i) an aggregate principal amount of $594,403 of secured subordinated convertible promissory notes of the Company (the "July 2017 Notes") due in July 2018, and (ii) warrants exercisable into 297,202 shares of Common Stock (the "July 2017 Warrants").
Warrants exercisable shares of common stock				297,202
LogicMark Investment Partners [Member]
Subsequent Events (Textual)
Outstanding balance including accrued and unpaid interest				$ 594,403
November Notes [Member]
Subsequent Events (Textual)
Common stock price per share					2
November Notes [Member] | Maximum [Member]
Subsequent Events (Textual)
Conversion price					3
November Notes [Member] | Minimum [Member]
Subsequent Events (Textual)
Conversion price					2
Warrants [Member]
Subsequent Events (Textual)
Sale of stock share price					1.42
Common stock price per share					3
Warrants [Member] | Maximum [Member]
Subsequent Events (Textual)
Warrant exercise price					3
Warrants [Member] | Minimum [Member]
Subsequent Events (Textual)
Warrant exercise price					$ 2
Offering [Member]
Subsequent Events (Textual)
Stock issued during the period shares issued for services, shares					2,170,000
Warrants purchase of common stock, shares					230,000
Expense payable					$ 3,429,700
Series B Preferred Stock [Member]
Subsequent Events (Textual)
Liquidated damages	673,183
Preferred stock converted into common stock, value	$ 1,265,581
Series A Preferred Stock [Member]
Subsequent Events (Textual)
Preferred stock converted into common stock, value		$ 141,644
Preferred stock converted into common stock, shares		75,343