Document and Entity Information
Document and Entity Information - shares | 6 Months Ended | |
Jun. 30, 2016 | Aug. 12, 2016 | |
Document And Entity Information | ||
Entity Registrant Name | Bright Mountain Media, Inc. | |
Entity Central Index Key | 1,568,385 | |
Document Type | 10-Q | |
Document Period End Date | Jun. 30, 2016 | |
Amendment Flag | false | |
Current Fiscal Year End Date | --12-31 | |
Is Entity a Well-known Seasoned Issuer | No | |
Is Entity a Voluntary Filer | No | |
Is Entity's Reporting Status Current | No | |
Entity Filer Category | Smaller Reporting Company | |
Entity Common Stock, Shares Outstanding | 37,588,421 | |
Document Fiscal Period Focus | Q2 | |
Document Fiscal Year Focus | 2,016 |
CONDENSED CONSOLIDATED BALANCE
CONDENSED CONSOLIDATED BALANCE SHEETS (Unaudited) - USD ($) | Jun. 30, 2016 | Dec. 31, 2015 |
Current Assets | ||
Cash | $ 116,489 | $ 416,187 |
Accounts Receivable | 39,147 | 42,449 |
Prepaid Costs and Expenses | 57,868 | 109,927 |
Inventories | 1,015,932 | 1,053,890 |
Total Current Assets | 1,229,436 | 1,622,453 |
Fixed Assets, net | 50,247 | 51,305 |
Website Acquisition Assets, net | 738,596 | 630,286 |
Other Assets | 15,080 | 15,547 |
Total Assets | 2,033,359 | 2,319,591 |
Current liabilities | ||
Accounts payable | 325,151 | 323,782 |
Premium Finance Loan Payable | 1,069 | 52,406 |
Total Current Liabilities | 326,220 | 376,188 |
Long Term Debt to Related Parties, net | 285,806 | 122,260 |
Total Liabilities | 612,026 | 498,448 |
Commitments and contingencies (Note 7) | ||
Shareholders' equity | ||
Preferred stock, par value $0.01, 20,000,000 shares authorized, 5,200,000 issued and 5,200,000 outstanding respectively | ||
Common stock, par value $.01, 324,000,000 shares authorized, 37,464,821 issued and outstanding at June 30, 2016, and 35,885,059 issued and outstanding at December 31, 2015, respectively. | 374,648 | 358,850 |
Additional paid-in-capital | 8,333,304 | 7,568,048 |
Accumulated Deficit | (7,338,619) | (6,157,755) |
Total shareholders' equity | 1,421,333 | 1,821,143 |
Total liabilities and shareholders' equity | 2,033,359 | 2,319,591 |
Series A Preferred Stock [Member] | ||
Shareholders' equity | ||
Preferred stock, par value $0.01, 20,000,000 shares authorized, 5,200,000 issued and 5,200,000 outstanding respectively | 19,000 | 19,000 |
Series B Preferred Stock [Member] | ||
Shareholders' equity | ||
Preferred stock, par value $0.01, 20,000,000 shares authorized, 5,200,000 issued and 5,200,000 outstanding respectively | 10,000 | 10,000 |
Series C Preferred Stock [Member] | ||
Shareholders' equity | ||
Preferred stock, par value $0.01, 20,000,000 shares authorized, 5,200,000 issued and 5,200,000 outstanding respectively | 18,000 | 18,000 |
Series D Preferred Stock [Member] | ||
Shareholders' equity | ||
Preferred stock, par value $0.01, 20,000,000 shares authorized, 5,200,000 issued and 5,200,000 outstanding respectively | $ 5,000 | $ 5,000 |
CONDENSED CONSOLIDATED BALANCE3
CONDENSED CONSOLIDATED BALANCE SHEETS (Parenthetical) - $ / shares | Jun. 30, 2016 | Dec. 31, 2015 |
Preferred stock, par value per share | $ 0.01 | $ 0.01 |
Preferred stock, shares authorized | 20,000,000 | 20,000,000 |
Preferred stock, shares issued | 5,200,000 | 5,200,000 |
Preferred stock, shares outstanding | 5,200,000 | 5,200,000 |
Common stock, par value per share | $ 0.01 | $ 0.01 |
Common stock, shares authorized | 324,000,000 | 324,000,000 |
Common shares, shares issued | 37,464,821 | 35,885,059 |
Common shares, shares outstanding | 37,464,821 | 35,885,059 |
Series A Preferred Stock [Member] | ||
Preferred stock, shares authorized | 2,000,000 | 2,000,000 |
Preferred stock, shares issued | 1,900,000 | 1,900,000 |
Preferred stock, shares outstanding | 1,900,000 | 1,900,000 |
Series B Preferred Stock [Member] | ||
Preferred stock, shares authorized | 1,000,000 | 1,000,000 |
Preferred stock, shares issued | 1,000,000 | 1,000,000 |
Preferred stock, shares outstanding | 1,000,000 | 1,000,000 |
Series C Preferred Stock [Member] | ||
Preferred stock, shares authorized | 2,000,000 | 2,000,000 |
Preferred stock, shares issued | 1,800,000 | 1,800,000 |
Preferred stock, shares outstanding | 1,800,000 | 1,800,000 |
Series D Preferred Stock [Member] | ||
Preferred stock, shares authorized | 2,000,000 | 2,000,000 |
Preferred stock, shares issued | 500,000 | 500,000 |
Preferred stock, shares outstanding | 500,000 | 500,000 |
CONDENSED CONSOLIDATED STATEMEN
CONDENSED CONSOLIDATED STATEMENT OF OPERATIONS (Unaudited) - USD ($) | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2016 | Jun. 30, 2015 | Jun. 30, 2016 | Jun. 30, 2015 | |
Income Statement [Abstract] | ||||
Product Sales | $ 336,042 | $ 323,848 | $ 683,821 | $ 585,572 |
Revenues from Services | 123,128 | 48,099 | 199,764 | 96,458 |
Total Revenue | 459,170 | 371,947 | 883,585 | 682,030 |
Cost of sales - Products | 236,986 | 271,809 | 507,521 | 459,919 |
Gross profit | 222,184 | 100,138 | 376,064 | 222,111 |
Selling, general and administrative expenses | 732,339 | 487,473 | 1,519,053 | 943,215 |
Loss from operations | (510,155) | (387,335) | (1,142,989) | (721,104) |
Other income (expense) | ||||
Interest income | 6 | 5 | 10 | 13 |
Interest expense | (21,758) | (446) | (37,885) | (891) |
Total other income (expense), net | (21,752) | (441) | (37,875) | (878) |
Net loss before taxes | (531,907) | (387,776) | (1,180,864) | (721,982) |
Income taxes | ||||
Net Loss | (531,907) | (387,776) | (1,180,864) | (721,982) |
Preferred stock dividends | ||||
Series A, Series B, Series C & Series D preferred | 110,197 | 72,642 | 218,186 | 145,458 |
Total preferred stock dividends | 110,197 | 72,642 | 218,186 | 145,458 |
Net loss attributable to common shareholders | $ (642,104) | $ (460,418) | $ (1,399,050) | $ (867,440) |
Basic and diluted net loss per share | $ (0.02) | $ (0.01) | $ (0.04) | $ (0.02) |
Weighted average shares outstanding - Basic and diluted | 37,377,483 | 39,046,279 | 36,927,554 | 36,285,718 |
CONDENSED CONSOLIDATED STATEME5
CONDENSED CONSOLIDATED STATEMENTS OF CHANGE IN SHAREHOLDERS' EQUITY (Unaudited) - 6 months ended Jun. 30, 2016 - USD ($) | Preferred Stock [Member] | Common Stock [Member] | Additional Paid-In Capital [Member] | Accumulated Deficit [Member] | Total |
Balance, shares at Dec. 31, 2015 | 5,200,000 | 35,885,059 | |||
Balance at Dec. 31, 2015 | $ 52,000 | $ 358,850 | $ 7,568,048 | $ (6,157,755) | $ 1,821,143 |
Common stock issued for services ($.695/share) | $ 640 | 43,840 | 44,480 | ||
Common stock issued for services ($.695/share), shares | 64,000 | ||||
Common stock issued for services ($.67/share) | $ 70 | 4,620 | 4,690 | ||
Common stock issued for services ($.67/share), shares | 7,000 | ||||
Common stock issued for services ($.75/share) | $ 36 | 2,664 | 2,700 | ||
Common stock issued for services ($.75/share), shares | 3,600 | ||||
Common stock issued for services ($.85/share) | $ 36 | 3,024 | 3,060 | ||
Common stock issued for services ($.85/share), shares | 3,600 | ||||
Sale of common stock for cash ($.50/share) pursuant to Subscription Agreement | $ 10,000 | 490,000 | 500,000 | ||
Sale of common stock for cash ($.50/share) pursuant to Subscription Agreement, shares | 1,000,000 | ||||
Common stock issued for 10% dividend payment pursuant to Series A preferred stock Subscription Agreements | $ 1,817 | (1,817) | |||
Common stock issued for 10% dividend payment pursuant to Series A preferred stock Subscription Agreements, shares | 181,699 | ||||
Common stock issued for 10% dividend payment pursuant to Series B preferred stock Subscription Agreements | $ 1,000 | (1,000) | |||
Common stock issued for 10% dividend payment pursuant to Series B preferred stock Subscription Agreements, shares | 100,000 | ||||
Common stock issued for 10% dividend payment pursuant to Series C preferred stock Subscription Agreements | $ 1,800 | (1,800) | |||
Common stock issued for 10% dividend payment pursuant to Series C preferred stock Subscription Agreements, shares | 180,000 | ||||
Common stock issued for 10% dividend payment pursuant to Series D preferred stock Subscription Agreements | $ 399 | (399) | |||
Common stock issued for 10% dividend payment pursuant to Series D preferred stock Subscription Agreements, shares | 39,863 | ||||
Stock option compensation expense | 77,124 | 77,124 | |||
Beneficial Conversion | 149,000 | 149,000 | |||
Net Loss | (1,180,864) | (1,180,864) | |||
Balance, shares at Jun. 30, 2016 | 5,200,000 | 37,464,821 | |||
Balance at Jun. 30, 2016 | $ 52,000 | $ 374,648 | $ 8,333,304 | $ (7,338,619) | $ 1,421,333 |
CONDENSED CONSOLIDATED STATEME6
CONDENSED CONSOLIDATED STATEMENTS OF CHANGE IN SHAREHOLDERS' EQUITY (Unaudited) (Parenthetical) | 6 Months Ended |
Jun. 30, 2016$ / shares | |
Common stock issued for services, Price Per Share | $ 0.695 |
Common stock issued for cash, Price Per Share | $ 0.50 |
Preferred Stock dividend rate | 10.00% |
Series A Preferred Stock [Member] | |
Preferred Stock dividend rate | 10.00% |
Series B Preferred Stock [Member] | |
Preferred Stock dividend rate | 10.00% |
Series C Convertible Preferred Stock [Member] | |
Preferred Stock dividend rate | 10.00% |
Series D Preferred Stock [Member] | |
Preferred Stock dividend rate | 10.00% |
CONDENSED CONSOLIDATED STATEME7
CONDENSED CONSOLIDATED STATEMENT OF CASH FLOWS (Unaudited) - USD ($) | 6 Months Ended | |
Jun. 30, 2016 | Jun. 30, 2015 | |
Cash flows from operating activities: | ||
Net Loss | $ (1,180,864) | $ (721,982) |
Adjustments to reconcile net loss to net cash used in operations: | ||
Depreciation | 6,679 | 6,757 |
Amortization of Debt Discount | 18,715 | |
Amortization | 124,425 | 86,136 |
Stock option compensation expense | 77,124 | 29,124 |
Common stock issued for services | 54,930 | 37,350 |
Changes in operating assets and liabilities: | ||
Accounts Receivable | 3,302 | (9,207) |
Inventory | 37,958 | (219,795) |
Prepaid costs and expenses | 52,059 | 23,908 |
Other assets | 467 | (467) |
Accounts payable | (106,298) | (17,181) |
Net cash used in operating activities | (911,503) | (785,357) |
Cash flows from investing activities: | ||
Purchase of fixed assets | (5,621) | (7,272) |
Purchase of websites | (131,237) | (153,000) |
Net cash used in investing activities | (136,858) | (160,272) |
Cash flows from financing activities: | ||
Sale of common stock | 500,000 | 290,000 |
Sale of Preferred stock | 400,000 | |
Payments on premium finance loan | (51,337) | (45,237) |
Long term Debt - Loan from Related Parties | 300,000 | |
Net cash provided by financing activities | 748,663 | 644,763 |
Net decrease in cash | (299,698) | (300,866) |
Cash at beginning of period | 416,187 | 590,236 |
Cash at end of period | 116,489 | 289,370 |
Supplemental Disclosure of Cash Flow Information | ||
Cash paid for Interest | 13,714 | 890 |
Cash paid for Income Taxes | ||
Non-Cash Investing and financing activities | ||
Common stock issued for purchase of websites | 262,500 | |
Premium finance loan payable recorded as prepaid | 38,060 | |
Payable for purchase of website | 150,000 | |
Beneficial conversion debt discount to additional paid-in-capital | $ 149,000 | |
Common stock issued to due Series A, Series B, Series C, and Series D stockholders | 501,562 | |
Present value of future monthly payments discount recorded | $ 32,732 |
NATURE OF OPERATIONS AND SUMMAR
NATURE OF OPERATIONS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | 6 Months Ended |
Jun. 30, 2016 | |
Accounting Policies [Abstract] | |
NATURE OF OPERATIONS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | NOTE 1 NATURE OF OPERATIONS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Organization and Nature of Operations Bright Mountain Media, Inc., formerly known as Bright Mountain Acquisition Corporation, is a Florida corporation formed on May 20, 2010. Its wholly owned subsidiaries, Bright Mountain LLC and The Bright Insurance Agency, LLC, were formed as Florida limited liability companies in May 2011. Its wholly owned subsidiary, Bright Watches, LLC was formed as Florida limited liability company in December 2015. On September 25, 2013 Five Peaks, LLC filed Articles of Amendment to the Articles of Organization with the State of Florida to amend its entity name to The Bright Insurance Agency, LLC. When used herein, the terms BMTM, the Company, we, us, our or Bright Mountain refers to Bright Mountain Media, Inc. and its subsidiaries. The Company is a media holding company of online assets. We sell various products through our proprietary websites and retail location, and through third party e-commerce distributor portals. Our websites provide content designed to attract and retain targeted Internet audiences. We generate revenues from two segments, product sales and services. Services consist of advertising revenue and subscription revenue. Our advertising revenue is generated primarily through the display of paid listings as well as display advertisements appearing on our websites. The Company obtained approximately 23% and 25% of its revenue from services for the three and six month periods ended June 30, 2016 from a third-party provider, namely Google AdSence. Paid listings are priced on a price per click basis and when a user submits a search query and then clicks on a Google AdSence paid listing displayed in response to the query, Google bills the advertiser that purchased the paid listing directly and shares a portion of the fee charged to the advertiser with the Company. The Company's remaining 77% and 75% of revenue for the same periods from services was from other third-party providers, direct advertising, and subscriptions. Bright Mountain plans to grow its business through organic growth and acquisitions. The Bright Mountain strategy is to concentrate its marketing and development primarily to military and public safety audiences and associated demographic. Our websites contain a number of sections with demographically oriented information including originally written news content, blogs, forums, career information, and video. Basis of Presentation The interim unaudited condensed consolidated financial statements included herein have been prepared by the Company pursuant to the rules and regulations of the Securities and Exchange Commission (the SEC). In the opinion of the Companys management, all adjustments necessary to present fairly the consolidated results of operations and cash flows for the six months ended June 30, 2016, and the consolidated financial position as of June 30, 2016 have been made. The results of operations for such interim period are not necessarily indicative of the operating results expected for the full year. Principles of Consolidation The interim unaudited condensed consolidated financial statements include the accounts of the Company and its wholly owned subsidiaries, Bright Mountain LLC, Bright Watches LLC and The Bright Insurance Agency, LLC. All significant intercompany transactions and balances have been eliminated in consolidation. Use of Estimates Our consolidated financial statements are prepared in accordance with Accounting Principles Generally Accepted in the United States (GAAP). These accounting principles require management to make certain estimates, judgments, and assumptions. We believe that the estimates, judgments, and assumptions upon which we rely are reasonable based upon information available to us at the time that these estimates, judgments, and assumptions are made. These estimates, judgments, and assumptions can affect the reported amounts of assets and liabilities as of the date of our consolidated financial statements as well as reported amounts of revenue and expenses during the periods presented. Our consolidated financial statements would be affected to the extent there are material differences between these estimates and actual results. In many cases, the accounting treatment of a particular transaction is specifically dictated by GAAP and does not require management's judgment in its application. There are also areas in which management's judgment in selecting any available alternative would not produce a materially different result. Significant estimates included in the accompanying consolidated financial statements include revenue recognition, the fair value of acquired assets for purchase price allocation in business combinations, valuation of inventory, valuation of intangible assets, estimates of amortization period for intangible assets, estimates of depreciation period for fixed assets, valuation of equity based transactions, and the valuation allowance on deferred tax assets. Cash and Cash Equivalents The Company considers all highly liquid investments with an original maturity of three months or less when purchased to be cash equivalents. Fair Value of Financial Instruments and Fair Value Measurements The Company measures its financial assets and liabilities in accordance with GAAP. For certain of our financial instruments, including cash, accounts payable, accrued expenses, and the short-term portion of long-term debt, the carrying amounts approximate fair value due to their short maturities. We adopted accounting guidance for financial and non-financial assets and liabilities in accordance with ASC 820 Fair Value Measurements and Disclosures Level 1: Observable inputs such as quoted prices (unadjusted) in active markets for identical assets or liabilities. Level 2: Inputs other than quoted prices that are observable, either directly or indirectly. These include quoted prices for similar assets or liabilities in active markets and quoted prices for identical or similar assets or liabilities in markets that are not active. Level 3: Unobservable inputs in which little or no market data exists, therefore developed using estimates and assumptions developed by us, which reflect those that a market participant would use. Accounts Receivable Accounts receivable are recorded at fair value on the date revenue is recognized. The Company provides allowances for doubtful accounts for estimated losses resulting from the inability of its customers to repay their obligation. If the financial condition of the Company's customers were to deteriorate, resulting in an impairment of their ability to repay, additional allowances may be required. The Company provides for potential uncollectible accounts receivable based on specific customer identification and historical collection experience adjusted for existing market conditions. If market conditions decline, actual collection experience may not meet expectations and may result in decreased cash flows and increased bad debt expense. The policy for determining past due status is based on the contractual payment terms of each customer, which are generally net 30 or net 60 days. Once collection efforts by the Company and its collection agency are exhausted, the determination for charging off uncollectible receivables is made. Inventories Inventories consist of finished goods and are stated at the lower of cost or market using the first in, first out (FIFO) method. Provisions have been made to reduce excess or obsolete inventories to their net realizable value. Revenue Recognition The Company recognizes revenue on our products in accordance with ASC 605, Revenue Recognition · Sale of merchandise directly to consumers: The Company's product sales are recognized either FOB shipping point or FOB destination, dependent on the customer. Revenues are therefore recognized at point of ownership transfer, accordingly. · Advertising revenue is received directly form companies who pay the Company a monthly fee for advertising space. · Advertising revenues are generated by users clicking on website advertisements utilizing several ad network partners: Revenues are recognized, on a net basis, upon receipt of payment by the ad network partner since the revenue is not determinable until it is received. · Subscription revenues are generated by the sale of access to career postings on one of our websites. The term of the subscriptions range from one month to twelve months. Revenues are recognized, on a net basis, over the term of the subscription period. All sales are final per the subscription Terms of Use. The Company follows the guidance of ASC 605-50-25, Revenue Recognition, Customer Payments Cost of Sales Components of costs of sales include product costs, shipping costs to customers and any inventory adjustments. Shipping and Handling Costs The Company includes shipping and handling fees billed to customers as revenues and shipping and handling costs for shipments to customers as cost of revenues. Sales Return Reserve Policy Our return policy generally allows our end users to return purchased products for refund or in exchange for new products. We estimate a reserve for sales returns, if any, and record that reserve amount as a reduction of sales and as a sales return reserve liability. Sales to consumers on our web site generally may be returned within a reasonable period of time. Product Warranty Reserve Policy The Company is a retail distributor of products and warranties are the responsibility of the manufacturer. Therefore, the Company does not record a reserve for product warranty Property and Equipment Property and equipment is recorded at cost. Depreciation is computed using the straight-line method based on the estimated useful lives of the related assets of seven years for office furniture and equipment, and five years for computer equipment. Leasehold improvements are amortized over the lesser of the lease term or the useful life of the improvements. Expenditures for maintenance and repairs along with fixed assets below our capitalization threshold of $500 are expensed as incurred. Website Development Costs The Company accounts for its website development costs in accordance with Accounting Standards Codification (ASC) ASC 350-50, Website Development Costs ASC 350-50 requires the expensing of all costs of the preliminary project stage and the training and application maintenance stage and the capitalization of all internal or external direct costs incurred during the application and infrastructure development stage. Upgrades or enhancements that add functionality are capitalized while other costs during the operating stage are expensed as incurred. The Company amortizes the capitalized website development costs over an estimated life of five years. As of June 30, 2016 and 2015, all website development costs have been expensed. Amortization and Impairment of Long-Lived Assets Amortization and impairment of long-lived assets are non-cash expenses relating primarily to website acquisitions. The Company accounts for long-lived assets in accordance with the provisions of ASC 360-10 Accounting for the Impairment or Disposal of Long-Lived Assets Website acquisition costs are amortized over five years. Recoverability of assets to be held and used is measured by a comparison of the carrying amount of an asset to future undiscounted net cash flows expected to be generated by the asset. If such assets are considered to be impaired, the impairment to be recognized is measured by the amount by which the carrying amount of the assets exceeds the fair value of the assets. Assets to be disposed of are reported at the lower of the carrying amount or fair value less costs to sell. While it is likely that we will have significant amortization expense as we continue to acquire websites, we believe that intangible assets represent costs incurred by the acquired website to build value prior to acquisition and the related amortization and impairment charges of assets, if applicable, are not ongoing costs of doing business. Non-cash amortization loss is included in selling, general and administrative expenses on the accompanying statement of operations. For the three months ended June 30, 2016 and June 30, 2015, non-cash amortization expense was $61,582 and $45,801, respectively. For the six months ended June 30, 2016 and June 30, 2015, non-cash amortization expense was $124,425 and $86,136, respectively. For the three and six months ended June 30, 2016 and June 30, 2015, non-cash impairment expense was $0 and $0 respectively. Stock-Based Compensation The Company accounts for stock-based instruments issued to employees for services in accordance with ASC Topic 718 Compensation Stock Compensation Equity-Based Payments to Non-Employees Advertising, Marketing and Promotion Costs Advertising, marketing and promotion expenses are expensed as incurred and are included in selling, general and administrative expenses on the accompanying statement of operations. For the six months ended June 30, 2016 and June 30, 2015, advertising, marketing and promotion expense was $12,106 and $14,537, respectively. Income Taxes We use the asset and liability method to account for income taxes. Under this method, deferred income taxes are determined based on the differences between the tax basis of assets and liabilities and their reported amounts in the consolidated financial statements which will result in taxable or deductible amounts in future years and are measured using the currently enacted tax rates and laws. A valuation allowance is provided to reduce net deferred tax assets to the amount that, based on available evidence, is more likely than not to be realized. The Company follows the provisions of ASC 740-10 Accounting for Uncertain Income Tax Positions. As of June 30, 2016, tax years 2015, 2014, and 2013 remain open for IRS audit. The Company has received no notice of audit or any notifications from the IRS for any of the open tax years. Basic and Diluted Net Earnings (Loss) Per Common Share In accordance with ASC 260-10 Earnings Per Share Segment Information In accordance with the provisions of ASC 280-10, Disclosures about Segments of an Enterprise and Related Information Recent Accounting Pronouncements In February 2016, the FASB issued ASU 2016-02, Leases In March 2016, the FASB issued ASU 2016-09, Compensation Stock Compensation: Improvements to Employee Share-Based Payment Accounting In April 2016, the FASB issued ASU 201610 Revenue from Contract with Customers (Topic 606): identifying Performance Obligations and Licensing. The amendments in this Update do not change the core principle of the guidance in Topic 606. Rather, the amendments in this Update clarify the following two aspects of Topic 606: identifying performance obligations and the licensing implementation guidance, while retaining the related principles for those areas. Topic 606 includes implementation guidance on (a) contracts with customers to transfer goods and services in exchange for consideration and (b) determining whether an entitys promise to grant a license provides a customer with either a right to use the entitys intellectual property (which is satisfied at a point in time) or a right to access the entitys intellectual property (which is satisfied over time). The amendments in this Update are intended render more detailed implementation guidance with the expectation to reduce the degree of judgement necessary to comply with Topic 606. We are currently reviewing the provisions of this ASU to determine if there will be any impact on our results of operations, cash flows or financial condition. In August 2014, the FASB issued ASU No. 2014-15, Presentation of Financial Statements - Going Concern In July 2015, FASB issued ASU No. 2015-11, Inventory (Topic 330): Simplifying the Measurement of Inventory more closely align the measurement of inventory in GAAP with the measurement of inventory in International Financial Reporting Standards (IFRS). The amendments in this ASU do not apply to inventory that is measured using last-in, first-out (LIFO) or the retail inventory method. The amendments apply to all other inventory, which includes inventory that is measured using first-in, first-out (FIFO) or average cost. An entity should measure inventory within the scope of this Update at the lower of cost and net realizable value. Net realizable value is the estimated selling prices in the ordinary course of business, less reasonably predictable costs of completion, disposal, and transportation. Subsequent measurement is unchanged for inventory measured using LIFO or the retail inventory method. For public business entities, this ASU is effective for fiscal years beginning after December 15, 2016, including interim periods within those fiscal years. For all other entities, this ASU is effective for fiscal years beginning after December 15, 2016, and interim periods within fiscal years beginning after December 15, 2017. The amendments in this ASU should be applied prospectively with earlier application permitted as of the beginning of an interim or annual reporting period. We are currently reviewing the provisions of this ASU to determine if there will be any impact on our results of operations, cash flows or financial condition. |
GOING CONCERN
GOING CONCERN | 6 Months Ended |
Jun. 30, 2016 | |
GOING CONCERN [Abstract] | |
GOING CONCERN | NOTE 2 - GOING CONCERN The accompanying condensed consolidated financial statements have been prepared on a going concern basis, which contemplates the realization of assets and the satisfaction of liabilities in the normal course of business. The Company sustained a net loss of $1,180,864 and used cash in operating activities of $911,503 for the six months ended June 30, 2016. The Company had an accumulated deficit of $7,338,619 at June 30, 2016. These factors raise substantial doubt about the ability of the Company to continue as a going concern for a reasonable period of time. The Company's continuation as a going concern is dependent upon its ability to generate revenues and its ability to continue receiving investment capital and loans from related parties to sustain its current level of operations. Management plans to continue to raise additional capital through private placements and is exploring additional avenues for future fund-raising through both public and private sources. The condensed consolidated financial statements do not include any adjustments relating to the recoverability and classification of recorded asset amounts or the amounts and classification of liabilities that might be necessary should the Company be unable to continue as a going concern. |
ACQUISITIONS
ACQUISITIONS | 6 Months Ended |
Jun. 30, 2016 | |
Business Combinations [Abstract] | |
ACQUISITIONS | NOTE 3 ACQUISITIONS As previously disclosed in our Annual Report on Form 10-K for the year ending December 31, 2015, on January 2, 2016, the Company closed the acquisition of warisboring.com pursuant to the terms and conditions of the Website Asset Purchase Agreement dated December 4, 2015 for an aggregate purchase price of $250,000. The purchase price consisted of a cash payment of $100,000 made at the January 4, 2016 closing and the balance of $150,000, payable monthly in an amount equal to 30% of the net revenues from the website, when collected, with the total amount of the earn out to be paid by January 4, 2019. The Company recorded the future monthly payments totaling $150,000 at a present value of $117,268, net of discount of $32,732. The present value was calculated at a discount rate of 12% (which is the Companys most recent borrowing rate) using the estimated future revenues from the website to estimate the payment dates. The estimated future revenues from the website were based on the average historical monthly revenues from the website prior to the Companys acquisition. During the six months ending June 30, 2016, the Company amortized $5,456 of this discount. The acquisition was accounted following ASC 805 Business Combinations Customer and related relationships $ 39,578 Website 177,690 Total $ 217,268 The above estimated discounted fair value of the intangible assets are based on a preliminary purchase price allocation prepared by management. As a result, during the preliminary purchase price allocation period, which may be up to one year from the business combination date, we may record adjustments to the asset acquired, with the corresponding offset to website. After the preliminary purchase price allocation period, we record adjustments to assets acquired subsequent to the purchase price allocation period in our operating results in the period in which the adjustments were determined. Pro forma results The following table sets forth the unaudited pro forma results of the Company as if the acquisition of the website had taken place on the first day of the period presented. These combined results are not necessarily indicative of the results that may have been achieved had the website been acquired as of the first day of the period presented. Three months ended June 30, 2015 Six months ended June 30, 2015 Total revenue $ 476,497 $ 884,130 Net loss (336,696 ) (642,822 ) Basic and diluted net loss per common share $ (0.01 ) $ (0.02 ) There were no costs of acquisition incurred as a result of this purchase. As previously disclosed in our Annual Report on Form 10-K for the year ending December 31, 2015, on February 12, 2015, the Company entered into a Website Asset Purchase Agreement to purchase a website for a purchase price of $15,000. The payment terms was $15,000 payable at the February 12, 2016 closing. The asset acquisition was accounted for as a purchase of assets in accordance with Rule 11-01 (d) of Regulation S-X and ASC 805-10-55-4. There were no costs of acquisition incurred as a result of the asset purchase. At June 30, 2016 and December 31, 2015, website acquisition assets consisted of the following: June 30, December 31, 2016 2015 Website Acquisition Assets $ 1,287,179 $ 1,054,444 Less: Accumulated Amortization (453,336 ) (328,911 ) Less: Impairment Loss (95,247 ) (95,247 ) Website Acquisition Assets, net $ 738,596 $ 630,286 Non-cash amortization expense for the three and six month periods ending June 30, 2016 and June 30, 2015 totaled $61,582 and $124,425, respectively, and $45,801 and $86,136, respectively. |
INVENTORIES
INVENTORIES | 6 Months Ended |
Jun. 30, 2016 | |
Inventory Disclosure [Abstract] | |
INVENTORIES | NOTE 4 INVENTORIES At June 30, 2016 and December 31, 2015 inventories consisted of the following: June 30, December 31, 2016 2015 Product Inventory: Clocks and Watches $ 969,565 $ 1,017,220 Product Inventory: Other Inventory 46,367 36,670 Total Inventory Balance $ 1,015,932 $ 1,053,890 |
SEGMENT INFORMATION
SEGMENT INFORMATION | 6 Months Ended |
Jun. 30, 2016 | |
Segment Reporting [Abstract] | |
SEGMENT INFORMATION | NOTE 5 SEGMENT INFORMATION The Company has two identifiable segments as of June 30, 2016; products and services. The products segment sells merchandise directly to customers thorough e-commerce distributor portals such as Amazon and eBay and through our proprietary websites and retail location. The services segment is focused on producing advertising revenue generated by users clicking on website advertisements utilizing several ad network partners and direct advertisers and subscription revenue generated by the sale of access to career postings on one of our websites. The following information represents segment activity for the three and six month periods ended June 30, 2016. Comparable information is presented for the respective periods in 2015: For the three months ended June 30, 2016 For the six months ended June 30, 2016 Products Services Total Products Services Total Revenues $ 336,042 $ 123,128 $ 459,170 $ 683,821 $ 199,764 $ 883,585 Amortization $ $ 61,582 $ 61,582 $ $ 124,425 $ 124,425 Depreciation $ 2,176 $ 1,169 $ 3,345 $ 4,888 $ 1,791 $ 6,679 Loss from operations $ (267,198 ) $ (242,957 ) $ (510,155 ) $ (680,802 ) $ (462,187 ) $ (1,142,989 ) Segment Assets $ 1,203,841 $ 829,518 $ 2,033,359 $ 1,203,841 $ 829,518 $ 2,033,359 For the three months ended For the six months ended June 30, 2015 June 30, 2015 Products Services Total Products Services Total Revenues $ 323,848 $ 48,099 $ 371,947 $ 585,572 $ 96,458 $ 682,030 Amortization $ $ 45,801 $ 45,801 $ $ 86,136 $ 86,136 Depreciation $ 2,979 $ 442 $ 3,421 $ 5,795 $ 962 $ 6,757 Loss from operations $ (286,424 ) $ (100,911 ) $ (387,335 ) $ (522,400 ) $ (198,704 ) $ (721,104 ) Segment Assets $ 1,381,335 $ 828,209 $ 2,209,544 $ 1,381,335 $ 828,209 $ 2,209,544 The following information represents further detail on segment revenues for the three and six month periods ended June 30, 2016 and 2015: Three Months Ended Six Months Ended (unaudited) (unaudited) June 30, June 30, June 30, June 30, 2016 2015 2016 2015 Revenue: Direct Product Sales $ 29,236 $ 24,607 $ 60,176 $ 40,757 Distributor Product Sales $ 306,806 $ 299,241 $ 623,645 $ 544,815 Services $ 123,128 $ 48,099 $ 199,764 $ 96,458 Total Revenue $ 459,170 $ 371,947 $ 883,585 $ 682,030 |
LONG TERM DEBT TO RELATED PARTI
LONG TERM DEBT TO RELATED PARTIES | 6 Months Ended |
Jun. 30, 2016 | |
Debt Disclosure [Abstract] | |
LONG TERM DEBT TO RELATED PARTIES | NOTE 6 LONG TERM DEBT TO RELATED PARTIES Beneficial Conversion Feature As previously disclosed in our Annual Report on Form 10-K for the year ending December 31, 2015, on December 22 and 29, 2015, the Company issued 12% convertible notes that have conversion prices that create a beneficial conversion. The notes mature on December 22 and 29, 2020 respectively. These notes are convertible at the option of the holders into shares of common stock at any time prior to maturity at a conversion price of $0.50 per share. A beneficial conversion feature exists on the date a convertible note is issued when the fair value of the underlying common stock to which the note is convertible into is in excess of the face value of the note. In accordance with this guidance, the intrinsic value of the beneficial conversion feature is recorded as a debt discount with a corresponding amount to additional paid in capital. The debt discount is amortized to interest expense over the five-year life of the notes using the effective interest method. During the year ending 2015, the Company recognized a debt discount of $78,000 and amortized $260. During the three and six months ending June 30, 2016, the Company amortized $3,943 and 7,887 respectively of debt discount. On February 9, 2016, the Company issued 12% convertible notes that have conversion prices that create a beneficial conversion. This note matures on February 9, 2021. These notes are convertible at the option of the holders into shares of common stock at any time prior to maturity at a conversion price of $0.50 per share. A beneficial conversion feature exists on the date a convertible note is issued when the fair value of the underlying common stock to which the note is convertible into is in excess of the face value of the note. In accordance with this guidance, the intrinsic value of the beneficial conversion feature is recorded as a debt discount with a corresponding amount to additional paid in capital. The debt discount is amortized to interest expense over the five-year life of the notes using the effective interest method. During the six months ended June 30, 2016, the Company recognized a debt discount of $39,000. During the three and six months ended June 30, 2016, the Company amortized $1,972 and $3,077 respectively of debt discount. On May 19, 2016, the Company issued 12% convertible notes that have conversion prices that create a beneficial conversion. This note matures on May 19, 2021. These notes are convertible at the option of the holders into shares of common stock at any time prior to maturity at a conversion price of $0.50 per share. A beneficial conversion feature exists on the date a convertible note is issued when the fair value of the underlying common stock to which the note is convertible into is in excess of the face value of the note. In accordance with this guidance, the intrinsic value of the beneficial conversion feature is recorded as a debt discount with a corresponding amount to additional paid in capital. The debt discount is amortized to interest expense over the five-year life of the notes using the effective interest method. During the six months ended June 30, 2016, the Company recognized a debt discount of $50,000. During the three and six months ended June 30, 2016, the Company amortized $1,167 and $1,167 respectively of debt discount. On June 10, 2016, the Company issued 12% convertible notes that have conversion prices that create a beneficial conversion. This note matures on June 10, 2021. These notes are convertible at the option of the holders into shares of common stock at any time prior to maturity at a conversion price of $0.50 per share. A beneficial conversion feature exists on the date a convertible note is issued when the fair value of the underlying common stock to which the note is convertible into is in excess of the face value of the note. In accordance with this guidance, the intrinsic value of the beneficial conversion feature is recorded as a debt discount with a corresponding amount to additional paid in capital. The debt discount is amortized to interest expense over the five-year life of the notes using the effective interest method. During the six months ended June 30, 2016, the Company recognized a debt discount of $25,000. During the three and six months ended June 30, 2016, the Company amortized $278 and $278 respectively of debt discount. On June 25, 2016, the Company issued 12% convertible notes that have conversion prices that create a beneficial conversion. This note matures on June 25, 2021. These notes are convertible at the option of the holders into shares of common stock at any time prior to maturity at a conversion price of $0.50 per share. A beneficial conversion feature exists on the date a convertible note is issued when the fair value of the underlying common stock to which the note is convertible into is in excess of the face value of the note. In accordance with this guidance, the intrinsic value of the beneficial conversion feature is recorded as a debt discount with a corresponding amount to additional paid in capital. The debt discount is amortized to interest expense over the five-year life of the notes using the effective interest method. During the six months ended June 30, 2016, the Company recognized a debt discount of $35,000. During the three and six months ended June 30, 2016, the Company amortized $136 and $136 respectively of debt discount. |
COMMITMENTS AND CONTINGENCIES
COMMITMENTS AND CONTINGENCIES | 6 Months Ended |
Jun. 30, 2016 | |
Commitments and Contingencies Disclosure [Abstract] | |
COMMITMENTS AND CONTINGENCIES | NOTE 7 COMMITMENTS AND CONTINGENCIES Leases The Company leases its corporate offices at 6400 Congress Avenue, Suite 2050, Boca Raton, Florida 33487 under a long-term non-cancellable lease agreement, which contains renewal options. The lease, which was entered into on August 25, 2014 was amended on July 30, 2015 to increase the original approximate 2,014 square feet to approximately 4,450 square feet. The term of the lease was extended and will terminate on March 14, 2019 at a current base rent of for a term of approximately $8,978 per month for the first twelve months with a 3% escalation each year. An additional security deposit of $2,500 was required. Rent is all-inclusive and includes electricity, heat, air-conditioning, and water. The original rent commencement date is October 11, 2014 and will expire on March 14, 2019. The Company leases retail space for its product sales division at 4900 Linton Boulevard, Bay 17A, Delray Beach, FL 33445 under a long-term, non-cancellable lease agreement, which contains renewal options. The lease, which was entered into on August 25, 2014, is for approximately 2,150 square feet for a term of 36 months in Delray Beach, Florida at a base rent of approximately $2,329 per month for the first twelve months with a 3% escalation each year. A security deposit of $3,865, first month's prepaid rent of $3,865, and last month's prepaid rent of $4,015 was paid upon lease execution. The lease is a triple net lease. Common area maintenance is approximately $1,317 per month for the first twelve months with annual escalations not to exceed 4%. The rent commencement date is October 1, 2014 and will expire on September 30, 2017. Rent expense for the six months ended June 30, 2016 and 2015 was $80,732 and $48,273 respectively. Legal From time-to-time, we may be involved in litigation relating to claims arising out of our operations in the normal course of business. As of June 30, 2016, there were no pending or threatened lawsuits that could reasonably be expected to have a material effect on the results of our operations. Other Commitments The Company entered into various contracts or agreements in the normal course of business, which may contain commitments. During the six months ended June 30, 2016 and June 30, 2015, the Company entered into agreements with third party vendors to supply website content and data, website software development, advertising, public relations, and legal services. All of these commitments contain provisions whereby either party may terminate the agreement with specified notice, normally 30 days, and with no further obligation on the part of either party. During the six months ended June 30, 2016 and June 30, 2015 the Company entered into agreements with third parties related to websites acquired during the respective periods as further discussed in Note 3. Future anticipated contractual minimum payments under these agreements total approximately $78,000 for 2016, $93,000 for 2017, and $55,000 for 2018. Future contingent milestone payments under these agreements total approximately $20,000 for the three months ended June 30, 2016. T otal payments for the six months ended June 30, 2016 and June 30, 2015 were $88,000 and $58,363 respectively. On January 2, 2016, the Company closed the acquisition of warisboring.com pursuant to the terms and conditions of the Website Asset Purchase Agreement dated December 4, 2015 for an aggregate purchase price of $250,000. The purchase price consisted of a cash payment of $100,000 at the January 4, 2016 closing and the balance of $150,000, payable monthly in an amount equal to 30% of the net revenues from the website, when collected, with the total amount of the earn out to be paid by January 4, 2019. The balance of the purchase price is recorded in Current Liabilities as of June 30, 2016. The Company entered into an Executive Employment Agreement with our Chief Executive Officer, with an effective date of June 1, 2014. Under the terms of this agreement, the Company will compensate the Chief Executive Officer with a base salary of $75,000 annually, and he is entitled to receive discretionary bonuses as may be awarded by the Company's Board of Directors from time to time. The initial term of the agreement is three years, and the Company may extend it for an additional one-year period upon written notice at least 180 days prior to the expiration of the term. The Chief Executive Officer's base annual salary was increased to $77,500 in January, 2015, $96,000 in July 2015, and to $125,000 effective October 1, 2015 upon recommendation of the Compensation Committee of the board of directors. Effective May 16, 2016 the Chief Executive Officers base salary was voluntarily decreased to $95,000 as part of a Company expense reduction initiative. The agreement will terminate upon the Chief Executive Officer's death or disability. In the event of a termination upon his death, the Company is obligated to pay his beneficiary or estate an amount equal to one year base salary plus any earned bonus at the time of his death. In the event the agreement is terminated as a result of his disability, as defined in the agreement, he is entitled to continue to receive his base salary for a period of one year. The Company is also entitled to terminate the agreement either with or without cause, and the Chief Executive Officer is entitled to voluntarily terminate the agreement upon one year's notice to the Company. In the event of a termination by the Company for cause, as defined in the agreement, or voluntarily by the Chief Executive Officer, the Company is obligated to pay him the base salary through the date of termination. In the event the Company terminates the agreement without cause, the Company is obligated to give him one years' notice of the Company's intent to terminate and, at the end of the one year period, pay an amount equal to two times his annual base salary together with any bonuses which may have been earned as of the date of termination. A constructive termination of the agreement will also occur if the Company materially breaches any term of the agreement or if a successor company to Bright Mountain Media, Inc. fails to assume the Company's obligations under the employment agreement. In that event, the Chief Executive Officer will be entitled to the same compensation as if the Company terminated the agreement without cause. The employment agreement contains customary non-compete and confidentiality provisions. The Company also agreed to indemnify the Chief Executive Officer pursuant to the provisions of the Company's Amended and Restated Articles of Incorporation and Restated By-laws. |
RELATED PARTIES
RELATED PARTIES | 6 Months Ended |
Jun. 30, 2016 | |
Related Party Transactions [Abstract] | |
RELATED PARTIES | NOTE 8 RELATED PARTIES During the year ended December 31, 2015 the Company issued a convertible note that has a conversion price that creates a beneficial conversion to a related party director and founder. The note issued was for an amount of $100,000 with a maturity date of December 22, 2020 and bears an interest rate of 12% paid monthly in cash on the first day of each month, commencing on January 1, 2016. A beneficial conversion feature exists on the date a convertible note is issued when the fair value of the underlying common stock to which the note is convertible into is in excess of the face value of the note. In accordance with this guidance, the intrinsic value of the beneficial conversion feature was recorded as a debt discount with a corresponding amount to additional paid in capital. The debt discount is amortized to interest expense over the five-year life of the note using the effective interest method. During the three and six-month periods ended June 30, 2016, Company amortized $1,971 and $3,943, respectively, related to this convertible note. During the three and six-month periods ended June 30, 2016, the Company recognized interest expense of $3,033 and $6,066, respectively, related to this convertible note. During the year ended December 31, 2015 the Company issued a convertible note that has a conversion price that creates a beneficial conversion to a related party. The note issued was for an amount of $100,000 with a maturity date of December 28, 2020 and bears an interest rate of 12% paid monthly in cash on the first day of each month, commencing on January 1, 2016. A beneficial conversion feature exists on the date a convertible note is issued when the fair value of the underlying common stock to which the note is convertible into is in excess of the face value of the note. In accordance with this guidance, the intrinsic value of the beneficial conversion feature was recorded as a debt discount with a corresponding amount to additional paid in capital. The debt discount is amortized to interest expense over the five-year life of the note using the effective interest method. During the three and six-month periods ended June 30, 2016, Company amortized $1,971 and $3,943, respectively, related to this convertible note. During the three and six-month periods ended June 30, 2016, the Company recognized interest expense of $3,033 and $6,066, respectively, related to this convertible note. During the six months ended June 30, 2016, the Company issued a convertible note that has a conversion price that creates a beneficial conversion to a related party director and founder. The note issued was for an amount of $100,000 with a maturity date of February 9, 2021 and bears an interest rate of 12% paid monthly in cash on the first day of each month, commencing on March 1, 2016. A beneficial conversion feature exists on the date a convertible note is issued when the fair value of the underlying common stock to which the note is convertible into is in excess of the face value of the note. In accordance with this guidance, the intrinsic value of the beneficial conversion feature was recorded as a debt discount with a corresponding amount to additional paid in capital. The debt discount is amortized to interest expense over the five-year life of the note using the effective interest method. During the three and six-month periods ended June 30, 2016, the Company recognized a discount of $39,000 and amortized $1,972 and $3,077, respectively, related to this convertible note. During the three and six-month periods ended June 30, 2016, the Company recognized interest expense of $3,033 and $4,733, respectively, related to this convertible note. During the six months ended June 30, 2016, the Company issued a convertible note that has a conversion price that creates a beneficial conversion to a related party director and founder. The note issued was for an amount of $100,000 with a maturity date of May 19, 2021 and bears an interest rate of 12% paid monthly in cash on the first day of each month, commencing on June 1, 2016. A beneficial conversion feature exists on the date a convertible note is issued when the fair value of the underlying common stock to which the note is convertible into is in excess of the face value of the note. In accordance with this guidance, the intrinsic value of the beneficial conversion feature was recorded as a debt discount with a corresponding amount to additional paid in capital. The debt discount is amortized to interest expense over the five-year life of the note using the effective interest method. During the six months ended June 3 2016, the Company recognized a discount of $50,000 and amortized $1,167 related to this convertible note. During the six months ended June 30, 2016, the Company recognized interest expense of $1,400 related to this convertible note. During the six months ended June 30, 2016, the Company issued a convertible note that has a conversion price that creates a beneficial conversion to a related party director and founder. The note issued was for an amount of $50,000 with a maturity date of June 10, 2021 and bears an interest rate of 12% paid monthly in cash on the first day of each month, commencing on July 1, 2016. A beneficial conversion feature exists on the date a convertible note is issued when the fair value of the underlying common stock to which the note is convertible into is in excess of the face value of the note. In accordance with this guidance, the intrinsic value of the beneficial conversion feature was recorded as a debt discount with a corresponding amount to additional paid in capital. The debt discount is amortized to interest expense over the five-year life of the note using the effective interest method. During the six months ended June 3 2016, the Company recognized a discount of $25,000 and amortized $278 related to this convertible note. During the six months ended June 30, 2016, the Company recognized interest expense of $333 related to this convertible note. During the six months ended June 30, 2016, the Company issued a convertible note that has a conversion price that creates a beneficial conversion to a related party director and founder. The note issued was for an amount of $50,000 with a maturity date of June 23, 2021 and bears an interest rate of 12% paid monthly in cash on the first day of each month, commencing on July 1, 2016. A beneficial conversion feature exists on the date a convertible note is issued when the fair value of the underlying common stock to which the note is convertible into is in excess of the face value of the note. In accordance with this guidance, the intrinsic value of the beneficial conversion feature was recorded as a debt discount with a corresponding amount to additional paid in capital. The debt discount is amortized to interest expense over the five-year life of the note using the effective interest method. During the six months ended June 3 2016, the Company recognized a discount of $35,000 and amortized $136 related to this convertible note. During the six months ended June 30, 2016, the Company recognized interest expense of $117 related to this convertible note. During the six months ended June 30, 2016, a related party founder purchased 1,000,000 shares of the Companys common stock for $500,000. |
SHAREHOLDERS' EQUITY
SHAREHOLDERS' EQUITY | 6 Months Ended |
Jun. 30, 2016 | |
Stockholders' Equity Note [Abstract] | |
SHAREHOLDERS' EQUITY | NOTE 9 SHAREHOLDERS EQUITY Preferred Stock The Company authorized 20,000,000 shares of preferred stock with a par value of $0.01. At a meeting of the Board of Directors, held on November 1, 2013, the directors approved the designation of two million (2,000,000) shares of the Preferred Stock as 10% Series A Convertible Preferred Stock ( Series A Stock At a meeting of the Board of Directors, held on December 23, 2013, the directors approved the designation of one million (1,000,000) shares of the Preferred Stock as 10% Series B Convertible Preferred Stock ( Series B Stock At a meeting of the Board of Directors, held on September 22, 2014, the directors approved the designation of two million (2,000,000) shares of the Preferred Stock as 10% Series C Convertible Preferred Stock ( Series C Stock At a meeting of the Board of Directors, held on March 20, 2015, the directors approved the designation of two million (2,000,000) shares of the Preferred Stock as 10% Series D Convertible Preferred Stock ( Series D Stock Series A, B, C and D Stock are also subject to adjustment of the conversion terms due to future mergers, sales and stock splits, if any. Common Stock A) Stock issued for services On January 15, 2016, the Company issued to a consultant 7,000 shares of its common stock at $0.695 per share, or $4,865, for services rendered. The Company valued these common shares based on the fair value at the date of grant. On February 15, 2016, the Company issued to a consultant 7,000 shares of its common stock at $0.695 per share, or $4,865, for services rendered. The Company valued these common shares based on the fair value at the date of grant. On March 22, 2016, the Company issued to a law firm 50,000 shares of its common stock at $0.695 per share, or $34,750, for services rendered. The Company valued these common shares based on the fair value at the date of grant. On April 15, 2016, the Company issued to a consultant 7,000 shares of its common stock at $0.67 per share, or $4,690, for services rendered. The Company valued these common shares based on the fair value at the date of grant. On May 16, 2016, the Company issued to a consultant 3,600 shares of its common stock at $0.75 per share, or $2,700, for services rendered. The Company valued these common shares based on the fair value at the date of grant. On June 20, 2016, the Company issued to a consultant 3,600 shares of its common stock at $0.85 per share, or $3,060, for services rendered. The Company valued these common shares based on the fair value at the date of grant. B) Stock issued for dividends During the six months ended June 30, 2016, the Company issued 501,562 shares of its common stock as dividends to the holders of its Series A, Series B, Series C, and Series D Stock only. Holders of the Series A, Series B, Series C, and Series D Stock are entitled to the payment of a 10% dividend payable in shares of the Companys common stock at a rate of one share of common stock for each ten shares of Series A, Series B, Series C, or Series D Stock payable on the tenth business day of January commencing in 2017. C) Stock issued for cash During the six months ended June 30, 2016, the Company raised additional capital through issuance of common stock pursuant to a private placement whereby $500,000 in capital was raised through the sale of 1,000,000 shares of common stock at $0.50 per share to our chief executive officer. Stock Incentive Plan and Stock Option Grants to Employees and Directors The Company accounts for stock option compensation issued to employees for services in accordance with ASC Topic 718, Compensation Stock Compensation Equity-Based Payments to Non-Employees Stock options issued to consultants and other non-employees as compensation for services provided to the Company are accounted for based on the fair value of the services provided or the estimated fair market value of the option, whichever is more reliably measurable in accordance with ASC 505 , Stock Option Plans The Company has adopted three stock option plans, the terms of which are substantially identical. The purpose of each plan is to provide an incentive to attract and retain directors, officers, consultants, advisors and employees whose services are considered valuable, to encourage a sense of proprietorship and to stimulate an active interest of such persons into our development and financial success. Under each plan, the Company is authorized to issue incentive stock options intended to qualify under Section 422 of the Code, non-qualified stock options, stock appreciation rights, performance shares, restricted stock and long-term incentive awards. The Compensation Committee of the Company's board of directors administers each plan. The material terms of each option which may be granted under each plan will contain the following terms: (i) that the purchase price of each share purchasable under an incentive option shall be determined by the Committee at the time of grant, (ii) the term of each option shall be fixed by the Committee, but no option shall be exercisable more than 10 years after the date such option is granted, and (iii) in the absence of any option vesting periods designated by the Committee at the time of grant, options shall vest and become exercisable in terms and conditions, consistent with the plan, as may be determined by the Committee and specified in the grant instrument. On April 20, 2011, the Company's board of directors and majority stockholder adopted the 2011 Stock Option Plan (the 2011 Plan), to be effective on January 3, 2011. The Company has reserved for issuance an aggregate of 900,000 shares of common stock under the 2011 Plan. The maximum aggregate number of shares of Company stock that shall be subject to Grants made under the Plan to any individual during any calendar year shall be 180,000 shares. As of June 30, 2016, 0 shares were remaining under the 2011 Plan for future issuance. On April 1, 2013, the Company's board of directors and majority stockholder adopted the 2013 Stock Option Plan (the 2013 Plan), to be effective on April 1, 2013. The Company has reserved for issuance an aggregate of 900,000 shares of common stock under the 2013 Plan. The maximum aggregate number of shares of Company stock that shall be subject to grants made under the 2013 Plan to any individual during any calendar year shall be 180,000 shares. As of June 30, 2016, 0 shares were remaining under the 2013 Plan for future issuance. On May 22, 2015, the Company's board of directors adopted the 2015 Stock Option Plan (the 2015 Plan), to be effective on May 22, 2015. Effective August 3, 2015, and as disclosed in the Company's Information Statement on Schedule 14C, the Company's majority shareholders ratified the adoption of the 2015 Plan. The Company has reserved for issuance an aggregate of 1,000,000 shares of common stock under the 2015 Plan. The maximum aggregate number of shares of Company stock that shall be subject to grants made under the 2015 Plan to any individual during any calendar year shall be 100,000 shares. As of June 30, 2016, 551,000 shares were remaining under the 2015 Plan for future issuance. On March 22, 2016 the Company granted 100,000 ten-year stock options, which have an exercise price of $0.695 per share to an executive officer and director. The aggregate fair value of these options was computed at $39,901 or $0.3990 per option. On March 22, 2016 the Company granted 46,000 ten-year stock options, which have an exercise price of $0.695 per share to a director. The aggregate fair value of these options was computed at $18,354 or $0.3990 per option. The Company estimates the fair value of share-based compensation utilizing the Black-Scholes option pricing model, which is dependent upon several variables such as the expected option term, expected volatility of our stock price over the expected option term, expected risk-free interest rate over the expected option term, expected dividend yield rate over the expected option term, and an estimate of expected forfeiture rates. The Company believes this valuation methodology is appropriate for estimating the fair value of stock options granted to employees and directors, which is subject to ASC Topic 718 requirements. These amounts are estimates and thus may not be reflective of actual future results, nor amounts ultimately realized by recipients of these grants. The Company recognizes share-based compensation expense on a straight-line basis over the requisite service period for each award. The following table summarizes the assumptions the Company utilized to record compensation expense for stock options granted during the six months ended June 30, 2016 and 2015: June 30, June 30, Assumptions: 2016 2015 Expected term (years) 6.8 6.25 Expected volatility 66 % 63 % Risk-free interest rate .01% - 2.07 % .38 % Dividend yield 0 % 0 % Expected forfeiture rate 0 % 0 % The expected life is computed using the simplified method, which is the average of the vesting term and the contractual term. The expected volatility is based on an average of similar public companies historical volatility. The risk-free interest rate is based on the U.S. Treasury yields with terms equivalent to the expected term of the related option at the time of the grant. Dividend yield is based on historical trends. While the Company believes these estimates are reasonable, the compensation expense recorded would increase if the expected life was increased, a higher expected volatility was used, or if the expected dividend yield increased. The Company recorded $59,551 and $15,390 stock option expense for the three months ended June 30, 2016 and June 30, 2015, respectively. The Company recorded $77,124 and $29,124 stock option expense for the six months ended June 30, 2016 and June 30, 2015, respectively. The $77,124 non-cash stock option expense for the six months ended June 30, 2016 has been recognized as a component of general and administrative expenses in the accompanying unaudited condensed consolidated financial statements. As of June 30, 2016 there were total unrecognized compensation costs related to non-vested share-based compensation arrangements of $82,731 to be recognized through June 2020. The grant date weighted average for fair values of options granted in 2016 is $ 0.695 per option. The intrinsic value as of June 30, 2016 was $22,630. A summary of the Company's stock option activity during the six months ended June 30, 2016 is presented below: Number of Options Weighted Average Exercise Price Weighted Average Remaining Contractual Term Aggregate Intrinsic Value Balance Outstanding, December 31, 2015 1,701,000 $ 0.34 6.6 $ 867,510 Granted 146,000 0.70 Exercised Forfeited Expired Balance Outstanding, June 30, 2016 1,847,000 $ 0.37 6.6 867,510 Exercisable at June 30, 2016 1,327,000 $ 0.28 5.4 $ 756,390 Summarized information with respect to options outstanding under the three option plans at June 30, 2016 is as follows: Options Outstanding Options Exercisable Range or Exercise Price Number Outstanding Remaining Average Contractual Life (In Years) Weighted Average Exercise Price Number Exercisable Weighted Average Exercise Price 0.14 - 0.24 720,000 1.7 $ 0.05 720,000 $ 0.08 0.25 - 0.49 351,000 1.1 $ 0.05 297,000 $ 0.06 0.50 - 0.78 776,000 3.5 $ 0.27 310,000 $ 0.14 1,847,000 2.3 $ 0.37 1,327,000 $ 0.09 |
CONCENTRATIONS
CONCENTRATIONS | 6 Months Ended |
Jun. 30, 2016 | |
Risks and Uncertainties [Abstract] | |
CONCENTRATIONS | NOTE 10 CONCENTRATIONS The Company has historically purchases a substantial amount of its products from two vendors; Citizens Watch Company of America, Inc., and Bulova Corporation. During the three months ended June 30, 2016, purchases from Citizens accounted for 44% and purchases from Bulova accounted for 15%, of the total products purchased as compared to 39% and 22%, respectively for the three months ended June 30, 2015. During the six months ended June 30, 2016, purchases from Citizens accounted for 39% and purchases from Bulova accounted for 17% of the total products purchases as compared to 39% and 29%, respectively for the six months ended June 30, 2015. Although we continue to add additional product vendors and we continue to expand our product line and vendor relationships, due to continued high concentration and reliance on these two vendors, the loss of one of these two vendors could adversely affect the Company's operations. The Company sells many of its products through various e-commerce distribution portals, which include Amazon and eBay. During the three months ended June 30, 2016, these two distributor portals accounted for 91% and 5%, respectively of our total revenue as compared to 78% and 2% respectively for the three months ended June 30, 2015. During the six months ended June 30, 2016, these two distributor portals accounted for 91% and 5%, respectively of our total revenue. Although our direct product sales have increased to 4% of total product revenue for the three months ended June 30, 2016 as compared to 1% for the three months ended June 30, 2015, due to the high concentration and reliance on these two e-commerce distributor portals, the loss of a working relationship with either of these two distributor portals could adversely affect the Company's operations. A substantial amount of payments for our products sold are processed through PayPal. A disruption in PayPal payment processing could have an adverse effect on the Company's operations and cash flow. The Company obtained approximately 23% of its advertising revenue for the three months ended June 30, 2016 from Google AdSense, a third-party provider, as compared to 57% for the three months ended June 30, 2015. Paid listings are priced on a price per click basis and when a user submits a search query and then clicks on a Google AdSense paid listing displayed in response to the query, Google bills the advertiser that purchased the paid listing directly and shares a portion of the fee charged to the advertiser with the Company. The Company's remaining 77% of advertising revenue for the three months ended June 30, 2016 was from direct advertising and subscriptions as compared to 43% for the three months ended June 30, 2015. Credit Risk The Company minimizes the concentration of credit risk associated with its cash by maintaining its cash with high quality federally insured financial institutions. However, cash balances in excess of the FDIC insured limit of $250,000 are at risk. At June 30, 2016 and December 31, 2015, respectively, the Company had cash balances above the FDIC insured limit of approximately $0 and $0 respectively. At June 30, 2016, our accounts receivable included amounts due from Google AdSense, INFORM and Medium Corporation representing 19%, 19% and 12%, respectively, of total accounts receivable. The Company performs ongoing evaluations of its trade accounts receivable customers and generally does not require collateral. Concentration of Funding During the six months ended June 30, 2016, the Company's funding was provided by the sale of shares of the Company's common stock to a related party officer and director. |
SUBSEQUENT EVENTS
SUBSEQUENT EVENTS | 6 Months Ended |
Jun. 30, 2016 | |
Subsequent Events [Abstract] | |
SUBSEQUENT EVENTS | NOTE 11 SUBSEQUENT EVENTS On July 7, 2016 and July 25, 2016, the Company issued two convertible notes in the amounts of $50,000 and $50,000, respectively. The notes were issued to a related party director and founder. The notes are convertible at $0.50 per share, bear interest at 12% per annum payable monthly in cash. The notes are convertible at a conversion price that creates a beneficial conversion, which will be recorded as a debt discount, which will be amortized to interest expense over the life of the notes. On July 12, 2016, the Board of Directors granted 340,000 ten-year stock options under the 2015 Plan to five employees. The options vest over four years and are executable at $0.85 per share, the fair value on the date of grant. On July 20, 2016, the Company issued a consulting firm 3,600 shares of our common stock for services provided. The shares were valued at $0.85 per share, the fair value on date of grant. On August 10, 2016, the Company raised capital of $60,000 through the sale of 120,000 shares of common stock to chief executive officer in a private transaction. On July 18, 2016, the Company entered into a five year lease agreement for retail space of 2,720 square feet. The lease has a five year term at an initial base rental of $43,438 per year, increasing 3% per year over the lease term. The facility will be used primarily for the increased storage and display space for the Companys watch product lines. |
NATURE OF OPERATIONS AND SUMM19
NATURE OF OPERATIONS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Policies) | 6 Months Ended |
Jun. 30, 2016 | |
Accounting Policies [Abstract] | |
Organization and Nature of Operations | Organization and Nature of Operations Bright Mountain Media, Inc., formerly known as Bright Mountain Acquisition Corporation, is a Florida corporation formed on May 20, 2010. Its wholly owned subsidiaries, Bright Mountain LLC and The Bright Insurance Agency, LLC, were formed as Florida limited liability companies in May 2011. Its wholly owned subsidiary, Bright Watches, LLC was formed as Florida limited liability company in December 2015. On September 25, 2013 Five Peaks, LLC filed Articles of Amendment to the Articles of Organization with the State of Florida to amend its entity name to The Bright Insurance Agency, LLC. When used herein, the terms BMTM, the Company, we, us, our or Bright Mountain refers to Bright Mountain Media, Inc. and its subsidiaries. The Company is a media holding company of online assets. We sell various products through our proprietary websites and retail location, and through third party e-commerce distributor portals. Our websites provide content designed to attract and retain targeted Internet audiences. We generate revenues from two segments, product sales and services. Services consist of advertising revenue and subscription revenue. Our advertising revenue is generated primarily through the display of paid listings as well as display advertisements appearing on our websites. The Company obtained approximately 23% and 25% of its revenue from services for the three and six month periods endied June 30, 2016 from a third-party provider, namely Google AdSence. Paid listings are priced on a price per click basis and when a user submits a search query and then clicks on a Google AdSence paid listing displayed in response to the query, Google bills the advertiser that purchased the paid listing directly and shares a portion of the fee charged to the advertiser with the Company. The Company's remaining 77% and 75% of revenue for the same periods from services was from other third-party providers, direct advertising, and subscriptions. Bright Mountain plans to grow its business through organic growth and acquisitions. The Bright Mountain strategy is to concentrate its marketing and development primarily to military and public safety audiences and associated demographic. Our websites contain a number of sections with demographically oriented information including originally written news content, blogs, forums, career information, and video. |
Basis of Presentation | Basis of Presentation The interim unaudited condensed consolidated financial statements included herein have been prepared by the Company pursuant to the rules and regulations of the Securities and Exchange Commission (the SEC). In the opinion of the Companys management, all adjustments necessary to present fairly the consolidated results of operations and cash flows for the six months ended June 30, 2016, and the consolidated financial position as of June 30, 2016 have been made. The results of operations for such interim period are not necessarily indicative of the operating results expected for the full year. |
Principles of Consolidation | Principles of Consolidation The interim unaudited condensed consolidated financial statements include the accounts of the Company and its wholly owned subsidiaries, Bright Mountain LLC, Bright Watches LLC and The Bright Insurance Agency, LLC. All significant intercompany transactions and balances have been eliminated in consolidation. |
Use of Estimates | Use of Estimates Our consolidated financial statements are prepared in accordance with Accounting Principles Generally Accepted in the United States (GAAP). These accounting principles require management to make certain estimates, judgments, and assumptions. We believe that the estimates, judgments, and assumptions upon which we rely are reasonable based upon information available to us at the time that these estimates, judgments, and assumptions are made. These estimates, judgments, and assumptions can affect the reported amounts of assets and liabilities as of the date of our consolidated financial statements as well as reported amounts of revenue and expenses during the periods presented. Our consolidated financial statements would be affected to the extent there are material differences between these estimates and actual results. In many cases, the accounting treatment of a particular transaction is specifically dictated by GAAP and does not require management's judgment in its application. There are also areas in which management's judgment in selecting any available alternative would not produce a materially different result. Significant estimates included in the accompanying consolidated financial statements include revenue recognition, the fair value of acquired assets for purchase price allocation in business combinations, valuation of inventory, valuation of intangible assets, estimates of amortization period for intangible assets, estimates of depreciation period for fixed assets, valuation of equity based transactions, and the valuation allowance on deferred tax assets. |
Cash and Cash Equivalents | Cash and Cash Equivalents The Company considers all highly liquid investments with an original maturity of three months or less when purchased to be cash equivalents. |
Fair Value of Financial Instruments and Fair Value Measurements | Fair Value of Financial Instruments and Fair Value Measurements The Company measures its financial assets and liabilities in accordance with GAAP. For certain of our financial instruments, including cash, accounts payable, accrued expenses, and the short-term portion of long-term debt, the carrying amounts approximate fair value due to their short maturities. We adopted accounting guidance for financial and non-financial assets and liabilities in accordance with ASC 820 Fair Value Measurements and Disclosures Level 1: Observable inputs such as quoted prices (unadjusted) in active markets for identical assets or liabilities. Level 2: Inputs other than quoted prices that are observable, either directly or indirectly. These include quoted prices for similar assets or liabilities in active markets and quoted prices for identical or similar assets or liabilities in markets that are not active. Level 3: Unobservable inputs in which little or no market data exists, therefore developed using estimates and assumptions developed by us, which reflect those that a market participant would use. |
Accounts Receivable | Accounts Receivable Accounts receivable are recorded at fair value on the date revenue is recognized. The Company provides allowances for doubtful accounts for estimated losses resulting from the inability of its customers to repay their obligation. If the financial condition of the Company's customers were to deteriorate, resulting in an impairment of their ability to repay, additional allowances may be required. The Company provides for potential uncollectible accounts receivable based on specific customer identification and historical collection experience adjusted for existing market conditions. If market conditions decline, actual collection experience may not meet expectations and may result in decreased cash flows and increased bad debt expense. The policy for determining past due status is based on the contractual payment terms of each customer, which are generally net 30 or net 60 days. Once collection efforts by the Company and its collection agency are exhausted, the determination for charging off uncollectible receivables is made. |
Inventories | Inventories Inventories consist of finished goods and are stated at the lower of cost or market using the first in, first out (FIFO) method. Provisions have been made to reduce excess or obsolete inventories to their net realizable value. |
Revenue Recognition | Revenue Recognition The Company recognizes revenue on our products in accordance with ASC 605, Revenue Recognition ·Sale of merchandise directly to consumers: The Company's product sales are recognized either FOB shipping point or FOB destination, dependent on the customer. Revenues are therefore recognized at point of ownership transfer, accordingly. · Advertising revenue is received directly form companies who pay the Company a monthly fee for advertising space. · Advertising revenues are generated by users clicking on website advertisements utilizing several ad network partners: Revenues are recognized, on a net basis, upon receipt of payment by the ad network partner since the revenue is not determinable until it is received. · Subscription revenues are generated by the sale of access to career postings on one of our websites. The term of the subscriptions range from one month to twelve months. Revenues are recognized, on a net basis, over the term of the subscription period. All sales are final per the subscription Terms of Use. The Company follows the guidance of ASC 605-50-25, Revenue Recognition, Customer Payments |
Cost of Sales | Cost of Sales Components of costs of sales include product costs, shipping costs to customers and any inventory adjustments. |
Shipping and Handling Costs | Shipping and Handling Costs The Company includes shipping and handling fees billed to customers as revenues and shipping and handling costs for shipments to customers as cost of revenues. |
Sales Return Reserve Policy | Sales Return Reserve Policy Our return policy generally allows our end users to return purchased products for refund or in exchange for new products. We estimate a reserve for sales returns, if any, and record that reserve amount as a reduction of sales and as a sales return reserve liability. Sales to consumers on our web site generally may be returned within a reasonable period of time. |
Product Warranty Reserve Policy | Product Warranty Reserve Policy The Company is a retail distributor of products and warranties are the responsibility of the manufacturer. Therefore, the Company does not record a reserve for product warranty |
Property and Equipment | Property and Equipment Property and equipment is recorded at cost. Depreciation is computed using the straight-line method based on the estimated useful lives of the related assets of seven years for office furniture and equipment, and five years for computer equipment. Leasehold improvements are amortized over the lesser of the lease term or the useful life of the improvements. Expenditures for maintenance and repairs along with fixed assets below our capitalization threshold of $500 are expensed as incurred. |
Website Development Costs | Website Development Costs The Company accounts for its website development costs in accordance with Accounting Standards Codification (ASC) ASC 350-50, Website Development Costs ASC 350-50 requires the expensing of all costs of the preliminary project stage and the training and application maintenance stage and the capitalization of all internal or external direct costs incurred during the application and infrastructure development stage. Upgrades or enhancements that add functionality are capitalized while other costs during the operating stage are expensed as incurred. The Company amortizes the capitalized website development costs over an estimated life of five years. As of June 30, 2016 and 2015, all website development costs have been expensed. |
Amortization and Impairment of Long-Lived Assets | Amortization and Impairment of Long-Lived Assets Amortization and impairment of long-lived assets are non-cash expenses relating primarily to website acquisitions. The Company accounts for long-lived assets in accordance with the provisions of ASC 360-10 Accounting for the Impairment or Disposal of Long-Lived Assets Website acquisition costs are amortized over five years. Recoverability of assets to be held and used is measured by a comparison of the carrying amount of an asset to future undiscounted net cash flows expected to be generated by the asset. If such assets are considered to be impaired, the impairment to be recognized is measured by the amount by which the carrying amount of the assets exceeds the fair value of the assets. Assets to be disposed of are reported at the lower of the carrying amount or fair value less costs to sell. While it is likely that we will have significant amortization expense as we continue to acquire websites, we believe that intangible assets represent costs incurred by the acquired website to build value prior to acquisition and the related amortization and impairment charges of assets, if applicable, are not ongoing costs of doing business. Non-cash amortization loss is included in selling, general and administrative expenses on the accompanying statement of operations. For the three months ended June 30, 2016 and June 30, 2015, non-cash amortization expense was $61,582 and $45,801, respectively. For the six months ended June 30, 2016 and June 30, 2015, non-cash amortization expense was $124,425 and $86,136, respectively. For the three and six months ended June 30, 2016 and June 30, 2015, non-cash impairment expense was $0 and $0 respectively. |
Stock-Based Compensation | Stock-Based Compensation The Company accounts for stock-based instruments issued to employees for services in accordance with ASC Topic 718 Compensation Stock Compensation Equity-Based Payments to Non-Employees |
Advertising, Marketing and Promotion Costs | Advertising, Marketing and Promotion Costs Advertising, marketing and promotion expenses are expensed as incurred and are included in selling, general and administrative expenses on the accompanying statement of operations. For the six months ended June 30, 2016 and June 30, 2015, advertising, marketing and promotion expense was $12,106 and $14,537, respectively. |
Income Taxes | Income Taxes We use the asset and liability method to account for income taxes. Under this method, deferred income taxes are determined based on the differences between the tax basis of assets and liabilities and their reported amounts in the consolidated financial statements which will result in taxable or deductible amounts in future years and are measured using the currently enacted tax rates and laws. A valuation allowance is provided to reduce net deferred tax assets to the amount that, based on available evidence, is more likely than not to be realized. The Company follows the provisions of ASC 740-10 Accounting for Uncertain Income Tax Positions. As of June 30, 2016, tax years 2015, 2014, and 2013 remain open for IRS audit. The Company has received no notice of audit or any notifications from the IRS for any of the open tax years. |
Basic and Diluted Net Earnings (Loss) Per Common Share | Basic and Diluted Net Earnings (Loss) Per Common Share In accordance with ASC 260-10 Earnings Per Share |
Segment Information | Segment Information In accordance with the provisions of ASC 280-10, Disclosures about Segments of an Enterprise and Related Information |
Recent Accounting Pronouncements | Recent Accounting Pronouncements In February 2016, the FASB issued ASU 2016-02, Leases In March 2016, the FASB issued ASU 2016-09, Compensation Stock Compensation: Improvements to Employee Share-Based Payment Accounting In April 2016, the FASB issued ASU 201610 Revenue from Contract with Customers (Topic 606): identifying Performance Obligations and Licensing. The amendments in this Update do not change the core principle of the guidance in Topic 606. Rather, the amendments in this Update clarify the following two aspects of Topic 606: identifying performance obligations and the licensing implementation guidance, while retaining the related principles for those areas. Topic 606 includes implementation guidance on (a) contracts with customers to transfer goods and services in exchange for consideration and (b) determining whether an entitys promise to grant a license provides a customer with either a right to use the entitys intellectual property (which is satisfied at a point in time) or a right to access the entitys intellectual property (which is satisfied over time). The amendments in this Update are intended render more detailed implementation guidance with the expectation to reduce the degree of judgement necessary to comply with Topic 606. We are currently reviewing the provisions of this ASU to determine if there will be any impact on our results of operations, cash flows or financial condition. In August 2014, the FASB issued ASU No. 2014-15, Presentation of Financial Statements - Going Concern In July 2015, FASB issued ASU No. 2015-11, Inventory (Topic 330): Simplifying the Measurement of Inventory more closely align the measurement of inventory in GAAP with the measurement of inventory in International Financial Reporting Standards (IFRS). The amendments in this ASU do not apply to inventory that is measured using last-in, first-out (LIFO) or the retail inventory method. The amendments apply to all other inventory, which includes inventory that is measured using first-in, first-out (FIFO) or average cost. An entity should measure inventory within the scope of this Update at the lower of cost and net realizable value. Net realizable value is the estimated selling prices in the ordinary course of business, less reasonably predictable costs of completion, disposal, and transportation. Subsequent measurement is unchanged for inventory measured using LIFO or the retail inventory method. For public business entities, this ASU is effective for fiscal years beginning after December 15, 2016, including interim periods within those fiscal years. For all other entities, this ASU is effective for fiscal years beginning after December 15, 2016, and interim periods within fiscal years beginning after December 15, 2017. The amendments in this ASU should be applied prospectively with earlier application permitted as of the beginning of an interim or annual reporting period. We are currently reviewing the provisions of this ASU to determine if there will be any impact on our results of operations, cash flows or financial condition. |
ACQUISITIONS (Tables)
ACQUISITIONS (Tables) | 6 Months Ended |
Jun. 30, 2016 | |
Business Combinations [Abstract] | |
Schedule of discounted fair value of the consideration transferred | Customer and related relationships $ 39,578 Website 177,690 Total $ 217,268 |
Schedule of Pro forma results | Three months ended June 30, 2015 Six months ended June 30, 2015 Total revenue $ 476,497 $ 884,130 Net loss (336,696 ) (642,822 ) Basic and diluted net loss per common share $ (0.01 ) $ (0.02 ) |
Schedule of Intangible Assets | June 30, December 31, 2016 2015 Website Acquisition Assets $ 1,287,179 $ 1,054,444 Less: Accumulated Amortization (453,336 ) (328,911 ) Less: Impairment Loss (95,247 ) (95,247 ) Website Acquisition Assets, net $ 738,596 $ 630,286 |
INVENTORIES (Tables)
INVENTORIES (Tables) | 6 Months Ended |
Jun. 30, 2016 | |
Inventory Disclosure [Abstract] | |
Schedule of Inventories | June 30, December 31, 2016 2015 Product Inventory: Clocks and Watches $ 969,565 $ 1,017,220 Product Inventory: Other Inventory 46,367 36,670 Total Inventory Balance $ 1,015,932 $ 1,053,890 |
SEGMENT INFORMATION (Tables)
SEGMENT INFORMATION (Tables) | 6 Months Ended |
Jun. 30, 2016 | |
Segment Reporting [Abstract] | |
Schedule of segment activity | For the three months ended June 30, 2016 For the six months ended June 30, 2016 Products Services Total Products Services Total Revenues $ 336,042 $ 123,128 $ 459,170 $ 683,821 $ 199,764 $ 883,585 Amortization $ $ 61,582 $ 61,582 $ $ 124,425 $ 124,425 Depreciation $ 2,176 $ 1,169 $ 3,345 $ 4,888 $ 1,791 $ 6,679 Loss from operations $ (267,198 ) $ (242,957 ) $ (510,155 ) $ (680,802 ) $ (462,187 ) $ (1,142,989 ) Segment Assets $ 1,203,841 $ 829,518 $ 2,033,359 $ 1,203,841 $ 829,518 $ 2,033,359 For the three months ended For the six months ended June 30, 2015 June 30, 2015 Products Services Total Products Services Total Revenues $ 323,848 $ 48,099 $ 371,947 $ 585,572 $ 96,458 $ 682,030 Amortization $ $ 45,801 $ 45,801 $ $ 86,136 $ 86,136 Depreciation $ 2,979 $ 442 $ 3,421 $ 5,795 $ 962 $ 6,757 Loss from operations $ (286,424 ) $ (100,911 ) $ (387,335 ) $ (522,400 ) $ (198,704 ) $ (721,104 ) Segment Assets $ 1,381,335 $ 828,209 $ 2,209,544 $ 1,381,335 $ 828,209 $ 2,209,544 Three Months Ended Six Months Ended (unaudited) (unaudited) June 30, June 30, June 30, June 30, 2016 2015 2016 2015 Revenue: Direct Product Sales $ 29,236 $ 24,607 $ 60,176 $ 40,757 Distributor Product Sales $ 306,806 $ 299,241 $ 623,645 $ 544,815 Services $ 123,128 $ 48,099 $ 199,764 $ 96,458 Total Revenue $ 459,170 $ 371,947 $ 883,585 $ 682,030 |
SHAREHOLDERS' EQUITY (Tables)
SHAREHOLDERS' EQUITY (Tables) | 6 Months Ended |
Jun. 30, 2016 | |
Stockholders' Equity Note [Abstract] | |
Schedule of Assumptions Used in Valuing Stock Options | June 30, June 30, Assumptions: 2016 2015 Expected term (years) 6.8 6.25 Expected volatility 66 % 63 % Risk-free interest rate .01% - 2.07 % .38 % Dividend yield 0 % 0 % Expected forfeiture rate 0 % 0 % |
Summary of Stock Option Activity | Number of Options Weighted Average Exercise Price Weighted Average Remaining Contractual Term Aggregate Intrinsic Value Balance Outstanding, December 31, 2015 1,701,000 $ 0.34 6.6 $ 867,510 Granted 146,000 0.70 Exercised Forfeited Expired Balance Outstanding, June 30, 2016 1,847,000 $ 0.37 6.6 867,510 Exercisable at June 30, 2016 1,327,000 $ 0.28 5.4 $ 756,390 |
Schedule of options outstanding under the option plans | Options Outstanding Options Exercisable Range or Exercise Price Number Outstanding Remaining Average Contractual Life (In Years) Weighted Average Exercise Price Number Exercisable Weighted Average Exercise Price 0.14 - 0.24 720,000 1.7 $ 0.05 720,000 $ 0.08 0.25 - 0.49 351,000 1.1 $ 0.05 297,000 $ 0.06 0.50 - 0.78 776,000 3.5 $ 0.27 310,000 $ 0.14 1,847,000 2.3 $ 0.37 1,327,000 $ 0.09 |
NATURE OF OPERATIONS AND SUMM24
NATURE OF OPERATIONS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Details)(Narrative) (Details) - USD ($) | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2016 | Jun. 30, 2015 | Jun. 30, 2016 | Jun. 30, 2015 | |
Non-cash impairment expense | $ 0 | $ 0 | $ 54,930 | $ 37,350 |
Non-cash amortization expense | 61,582 | 45,801 | 124,425 | 86,136 |
Non-cash stock-based stock option compensation | $ 59,551 | $ 15,390 | 77,124 | 29,124 |
Advertising, marketing and promotion expense | 12,106 | $ 14,537 | ||
Property and equipment, capitalization threshold | $ 500 | |||
Maximum [Member] | ||||
Contractual payment terms | 60 years | |||
Minimum [Member] | ||||
Contractual payment terms | 30 years | |||
Website Development Costs [Member] | ||||
Property, Plant and Equipment, Useful Life | 5 years | |||
Furniture and Fixtures [Member] | ||||
Contractual payment terms | 7 years | |||
Computer Equipment [Member] | ||||
Contractual payment terms | 5 years | |||
Website Acquisition Costs [Member] | ||||
Property, Plant and Equipment, Useful Life | 5 years | |||
Internal Revenue Service (IRS) [Member] | 2013 [Member] | ||||
Open Tax Year | 2,013 | |||
Internal Revenue Service (IRS) [Member] | 2014 [Member] | ||||
Open Tax Year | 2,014 | |||
Internal Revenue Service (IRS) [Member] | 2015 [Member] | ||||
Open Tax Year | 2,015 | |||
Revenue [Member] | Google AdSence [Member] | ||||
Revenues from services | 23.00% | 25.00% | ||
Revenue [Member] | Other third-party providers [Member] | ||||
Revenues from services | 77.00% | 75.00% | ||
Stock Option [Member] | ||||
Common stock equivalent shares | 1,847,000 | 1,605,000 | ||
Convertible Preferred Stock [Member] | ||||
Common stock equivalent shares | 5,200,000 | 5,200,000 | ||
Convertible Notes Payable [Member] | ||||
Common stock equivalent shares | 1,000,000 | 0 |
GOING CONCERN (Narrative) (Deta
GOING CONCERN (Narrative) (Details) - USD ($) | 3 Months Ended | 6 Months Ended | |||
Jun. 30, 2016 | Jun. 30, 2015 | Jun. 30, 2016 | Jun. 30, 2015 | Dec. 31, 2015 | |
GOING CONCERN [Abstract] | |||||
Net loss | $ 531,907 | $ 387,776 | $ 1,180,864 | $ 721,982 | |
Net cash used in operating activities | 911,503 | $ 785,357 | |||
Accumulated deficit | $ 7,338,619 | $ 7,338,619 | $ 6,157,755 |
ACQUISITIONS (Narrative) (Detai
ACQUISITIONS (Narrative) (Details) - USD ($) | Feb. 12, 2016 | Jan. 04, 2016 | Jan. 02, 2016 | Jun. 30, 2016 | Jun. 30, 2015 | Jun. 30, 2016 | Jun. 30, 2015 |
Business Acquisition [Line Items] | |||||||
Aggregate purchase price | $ 217,268 | ||||||
Cash payment for acquisition | 100,000 | ||||||
Future monthly payments | $ 150,000 | 150,000 | |||||
Present value of future monthly payments | 117,268 | 117,268 | |||||
Net of discount | $ 32,732 | ||||||
Discount rate | 12.00% | ||||||
Amortization of discount, Net | 5,456 | $ 5,456 | |||||
Non-cash amortization expense | $ 61,582 | $ 45,801 | $ 124,425 | $ 86,136 | |||
Websites [Member] | |||||||
Business Acquisition [Line Items] | |||||||
Aggregate purchase price | $ 15,000 | $ 250,000 | |||||
Cash payment for acquisition | $ 15,000 | $ 100,000 | |||||
Balance payment of acquisition | $ 150,000 | ||||||
Monthly payment percenage of net revenues | 30.00% |
ACQUISITIONS (Schedule of estim
ACQUISITIONS (Schedule of estimated discounted fair value) (Details) | 6 Months Ended |
Jun. 30, 2016USD ($) | |
Total | $ 217,268 |
Customer and related relationships [Member] | |
Total | 39,578 |
Website [Member] | |
Total | $ 177,690 |
ACQUISITIONS (Schedule of Pro f
ACQUISITIONS (Schedule of Pro forma results) (Details) - USD ($) | 3 Months Ended | 6 Months Ended |
Jun. 30, 2016 | Jun. 30, 2016 | |
Business Combinations [Abstract] | ||
Total revenue | $ 476,497 | $ 884,130 |
Net loss | $ (336,696) | $ (642,822) |
Basic and diluted net loss per common share | $ (0.01) | $ (0.02) |
ACQUISITIONS (Schedule of Intan
ACQUISITIONS (Schedule of Intangible Assets) (Details) - USD ($) | Jun. 30, 2016 | Dec. 31, 2015 |
Business Combinations [Abstract] | ||
Website Acquisition Assets | $ 1,287,179 | $ 1,054,444 |
Less: Accumulated Amortization | (453,336) | (328,911) |
Less: Impairment Loss | (95,247) | (95,247) |
Website Acquisition Assets, net | $ 738,596 | $ 630,286 |
INVENTORIES (Details)
INVENTORIES (Details) - USD ($) | Jun. 30, 2016 | Dec. 31, 2015 |
Inventory [Line Items] | ||
Inventory Balance | $ 1,015,932 | $ 1,053,890 |
Product Inventory: Clocks & Watches [Member] | ||
Inventory [Line Items] | ||
Inventory Balance | 969,565 | 1,017,220 |
Product Inventory: Other Inventory [Member] | ||
Inventory [Line Items] | ||
Inventory Balance | $ 46,367 | $ 36,670 |
SEGMENT INFORMATION (Details)
SEGMENT INFORMATION (Details) | 3 Months Ended | 6 Months Ended | |||
Jun. 30, 2016USD ($)item | Jun. 30, 2015USD ($) | Jun. 30, 2016USD ($) | Jun. 30, 2015USD ($) | Dec. 31, 2015USD ($) | |
Segment Reporting Information [Line Items] | |||||
Number of reportable segments | item | 2 | ||||
Revenues | $ 459,170 | $ 371,947 | $ 883,585 | $ 682,030 | |
Amortization | 61,582 | 45,801 | 124,425 | 86,136 | |
Depreciation | 3,345 | 3,421 | 6,679 | 6,757 | |
Loss from operations | (510,155) | (387,335) | (1,142,989) | (721,104) | |
Segment Assets | 2,033,359 | 2,209,544 | 2,033,359 | 2,209,544 | $ 2,319,591 |
Products [Member] | |||||
Segment Reporting Information [Line Items] | |||||
Revenues | 336,042 | 323,848 | 683,821 | 585,572 | |
Amortization | |||||
Depreciation | 2,176 | 2,979 | 4,888 | 5,795 | |
Loss from operations | (267,198) | (286,424) | (680,802) | (522,400) | |
Segment Assets | 1,203,841 | 1,381,335 | 1,203,841 | 1,381,335 | |
Services [Member] | |||||
Segment Reporting Information [Line Items] | |||||
Revenues | 123,128 | 48,099 | 199,764 | 96,458 | |
Amortization | 61,582 | 45,801 | 124,425 | 86,136 | |
Depreciation | 1,169 | 442 | 1,791 | 962 | |
Loss from operations | (242,957) | (100,911) | (462,187) | (198,704) | |
Segment Assets | 829,518 | 828,209 | 829,518 | 828,209 | |
Direct Product Sales [Member] | Products [Member] | |||||
Segment Reporting Information [Line Items] | |||||
Revenues | 29,236 | 24,607 | 60,176 | 40,757 | |
Distributor Product Sales [Member] | Products [Member] | |||||
Segment Reporting Information [Line Items] | |||||
Revenues | $ 306,806 | $ 299,241 | $ 623,645 | $ 544,815 |
LONG TERM DEBT TO RELATED PAR32
LONG TERM DEBT TO RELATED PARTIES (Narrative) (Details) - USD ($) | 1 Months Ended | 3 Months Ended | 6 Months Ended | 12 Months Ended | ||||||
Dec. 29, 2015 | Dec. 22, 2015 | Jun. 30, 2016 | Jun. 30, 2016 | Jun. 30, 2015 | Dec. 31, 2015 | Jun. 25, 2016 | Jun. 10, 2016 | May 19, 2016 | Feb. 09, 2016 | |
Amortization of debt discount | $ 18,715 | |||||||||
Convertible Notes Payable [Member] | 12% Convertible Notes Maturing On December 22 and 29, 2020, Respectively [Member] | ||||||||||
Conversion price | $ 0.50 | $ 0.50 | $ 0.50 | |||||||
Debt discount | $ 7,800 | |||||||||
Debt discount amortization period | 5 years | 5 years | 5 years | 5 years | ||||||
Interest rate | 12.00% | 12.00% | 12.00% | |||||||
Notes maturity dates | Dec. 29, 2020 | Dec. 22, 2020 | ||||||||
Amortization of debt discount | $ 3,943 | $ 7,887 | $ 260 | |||||||
Convertible Notes Payable [Member] | 12% Convertible Notes Maturing On February 9, 2021 [Member] | ||||||||||
Conversion price | $ 0.5 | $ 0.5 | $ 0.5 | |||||||
Debt discount | $ 39,000 | |||||||||
Debt discount amortization period | 5 years | 5 years | ||||||||
Interest rate | 12.00% | 12.00% | 12.00% | |||||||
Notes maturity dates | Feb. 9, 2021 | Feb. 9, 2021 | ||||||||
Amortization of debt discount | $ 1,972 | $ 3,077 | ||||||||
Convertible Notes Payable [Member] | 12% Convertible Notes Maturing On May 19, 2021 [Member] | ||||||||||
Conversion price | $ 0.50 | $ 0.50 | $ 0.50 | |||||||
Debt discount | $ 50,000 | |||||||||
Debt discount amortization period | 5 years | 5 years | ||||||||
Interest rate | 12.00% | 12.00% | 12.00% | |||||||
Notes maturity dates | May 19, 2021 | May 19, 2021 | ||||||||
Amortization of debt discount | $ 1,167 | $ 1,167 | ||||||||
Convertible Notes Payable [Member] | 12% Convertible Notes Maturing On June 10, 2021 [Member] | ||||||||||
Conversion price | $ 0.5 | $ 0.5 | $ 0.5 | |||||||
Debt discount | $ 25,000 | |||||||||
Debt discount amortization period | 5 years | 5 years | ||||||||
Interest rate | 12.00% | 12.00% | 12.00% | |||||||
Notes maturity dates | Jun. 10, 2021 | Jun. 10, 2021 | ||||||||
Amortization of debt discount | $ 278 | $ 278 | ||||||||
Convertible Notes Payable [Member] | 12% Convertible Notes Maturing On June 25, 2021 [Member] | ||||||||||
Conversion price | $ 0.5 | $ 0.5 | $ 0.5 | |||||||
Debt discount | $ 35,000 | |||||||||
Debt discount amortization period | 5 years | 5 years | ||||||||
Interest rate | 12.00% | 12.00% | 12.00% | |||||||
Notes maturity dates | Jun. 25, 2021 | Jun. 25, 2021 | ||||||||
Amortization of debt discount | $ 136 | $ 136 |
COMMITMENTS AND CONTINGENCIES (
COMMITMENTS AND CONTINGENCIES (Narrative) (Details) | Feb. 12, 2016USD ($) | Jan. 04, 2016USD ($) | Jan. 02, 2016USD ($) | Jun. 30, 2016USD ($)ft² | Jun. 30, 2016USD ($)ft² | Jun. 30, 2015USD ($) | Oct. 02, 2015USD ($) | Jul. 31, 2015USD ($) | Jul. 30, 2015ft² | Jan. 31, 2015USD ($) |
Operating Leased Assets [Line Items] | ||||||||||
Rent expense | $ 80,732 | $ 48,273 | ||||||||
Cash payment for acquisition | 100,000 | |||||||||
Aggregate purchase price | 217,268 | |||||||||
Chief Executive Officer [Member] | Executive Employment Agreement [Member] | ||||||||||
Operating Leased Assets [Line Items] | ||||||||||
Base salary to be paid to related party | $ 75,000 | 75,000 | $ 125,000 | $ 96,000 | $ 77,500 | |||||
Initial term of employment agreement with related party | 3 years | |||||||||
Officer's base salary | $ 95,000 | |||||||||
Websites [Member] | ||||||||||
Operating Leased Assets [Line Items] | ||||||||||
Future anticipated minimum lease payments due in 2016 | 78,000 | 78,000 | ||||||||
Future anticipated minimum lease payments due in 2017 | 93,000 | 93,000 | ||||||||
Future anticipated minimum lease payments due in 2018 | 55,000 | 55,000 | ||||||||
Future contingent milestone payments | $ 10,000 | 10,000 | ||||||||
Cash payment for acquisition | $ 15,000 | $ 100,000 | ||||||||
Acquisition milestone payments | $ 88,000 | $ 58,363 | ||||||||
Aggregate purchase price | $ 15,000 | $ 250,000 | ||||||||
Monthly payment percenage of net revenues | 30.00% | |||||||||
Balance payment of acquisition | $ 150,000 | |||||||||
6400 Congress Avenue, Suite 2050, Boca Raton, Florida Property [Member] | ||||||||||
Operating Leased Assets [Line Items] | ||||||||||
Area of real estate space | ft² | 4,450 | 4,450 | 4,450 | |||||||
Monthly base rent owed per operating lease agreement | $ 8,978 | $ 8,978 | ||||||||
Period of monthly base rent | 12 months | |||||||||
Percentage of escalation in monthly base rent | 3.00% | 3.00% | ||||||||
Lease expiration date | Aug. 25, 2014 | |||||||||
Security deposit | $ 2,500 | $ 2,500 | ||||||||
4900 Linton Boulevard, Bay 17A, Delray Beach, FL Property [Member] | ||||||||||
Operating Leased Assets [Line Items] | ||||||||||
Area of real estate space | ft² | 2,150 | 2,150 | ||||||||
Lease terms | 36 months | |||||||||
Monthly base rent owed per operating lease agreement | $ 2,329 | $ 2,329 | ||||||||
Period of monthly base rent | 12 months | |||||||||
Percentage of escalation in monthly base rent | 3.00% | 3.00% | ||||||||
Lease expiration date | Aug. 25, 2014 | |||||||||
Security deposit | $ 3,865 | $ 3,865 | ||||||||
First month''s prepaid rent | 3,865 | |||||||||
Last month's prepaid rent | 4,015 | 4,015 | ||||||||
Monthly common area maintenance | $ 1,317 | $ 1,317 | ||||||||
Period of monthly common area maintenance | 12 months | |||||||||
Percentage of escalation in monthly common area maintenance | 4.00% |
RELATED PARTIES (Narrative) (De
RELATED PARTIES (Narrative) (Details) - USD ($) | 3 Months Ended | 6 Months Ended | 12 Months Ended | |
Jun. 30, 2016 | Jun. 30, 2016 | Jun. 30, 2015 | Dec. 31, 2015 | |
Related Party Transaction [Line Items] | ||||
Stock issued during period | $ 500,000 | |||
Amortization of debt discount | $ 18,715 | |||
Related Party Founder [Member] | ||||
Related Party Transaction [Line Items] | ||||
Stock issued during period, shares | 1,000,000 | |||
Stock issued during period | $ 500,000 | |||
Convertible Note [Member] | ||||
Related Party Transaction [Line Items] | ||||
Note issued | $ 100,000 | |||
Maturity date of note | Dec. 22, 2020 | |||
Bearing interest rate | 12.00% | |||
Amortization of debt discount | $ 1,971 | 3,943 | ||
Recognized interest expense | 3,033 | 6,066 | ||
Convertible Note One [Member] | ||||
Related Party Transaction [Line Items] | ||||
Note issued | $ 100,000 | |||
Maturity date of note | Dec. 28, 2020 | |||
Bearing interest rate | 12.00% | |||
Amortization of debt discount | 1,971 | 3,943 | $ 65 | |
Recognized interest expense | $ 3,033 | 6,066 | $ 10 | |
Convertible Note Two [Member] | ||||
Related Party Transaction [Line Items] | ||||
Note issued | $ 100,000 | |||
Maturity date of note | Feb. 9, 2021 | |||
Bearing interest rate | 12.00% | 12.00% | ||
Recognized a discount | $ 39,000 | $ 39,000 | ||
Amortization of debt discount | 1,972 | 3,077 | ||
Recognized interest expense | 3,033 | $ 4,733 | ||
Convertible Note Three [Member] | ||||
Related Party Transaction [Line Items] | ||||
Note issued | $ 100,000 | |||
Maturity date of note | May 19, 2021 | |||
Bearing interest rate | 12.00% | 12.00% | ||
Recognized a discount | $ 50,000 | $ 50,000 | ||
Amortization of debt discount | 1,167 | $ 1,167 | ||
Recognized interest expense | 1,400 | |||
Convertible Note Four [Member] | ||||
Related Party Transaction [Line Items] | ||||
Note issued | $ 50,000 | |||
Maturity date of note | Jun. 10, 2021 | |||
Bearing interest rate | 12.00% | 12.00% | ||
Recognized a discount | $ 25,000 | $ 25,000 | ||
Amortization of debt discount | 278 | 278 | ||
Recognized interest expense | 333 | |||
Convertible Note Five [Member] | ||||
Related Party Transaction [Line Items] | ||||
Note issued | $ 50,000 | |||
Maturity date of note | Jun. 23, 2021 | |||
Recognized a discount | $ 35,000 | 35,000 | ||
Amortization of debt discount | 136 | $ 136 | ||
Recognized interest expense | $ 117 |
SHAREHOLDERS' EQUITY (Narrative
SHAREHOLDERS' EQUITY (Narrative) (Details) - USD ($) | Jan. 15, 2016 | Sep. 22, 2014 | Jun. 20, 2016 | May 16, 2016 | Apr. 15, 2016 | Mar. 22, 2016 | Feb. 15, 2016 | Jan. 31, 2016 | Mar. 20, 2015 | Dec. 23, 2013 | Nov. 30, 2013 | Apr. 30, 2013 | Apr. 20, 2011 | Jun. 30, 2016 | Jun. 30, 2015 | Jun. 30, 2016 | Jun. 30, 2015 | Dec. 31, 2015 |
Stockholders' Equity [Line Items] | ||||||||||||||||||
Preferred stock, par value per share | $ 0.01 | $ 0.01 | $ 0.01 | |||||||||||||||
Preferred stock, shares authorized | 20,000,000 | 20,000,000 | 20,000,000 | |||||||||||||||
Dividend rate | 10.00% | 0.00% | ||||||||||||||||
Preferred stock dividends, shares issued | 501,562 | |||||||||||||||||
Stock options, exercise price | $ 0.70 | |||||||||||||||||
Options exercisable, weighted-average exercise price | $ 0.28 | 0.28 | ||||||||||||||||
Intrinsic value of exercisable options per exercisable option | $ 22,630 | 22,630 | ||||||||||||||||
Fair value of options granted per option | $ 0.695 | |||||||||||||||||
Share based compensation expense | $ 59,551 | $ 15,390 | $ 77,124 | $ 29,124 | ||||||||||||||
Unrecognized compensation cost | $ 82,731 | $ 82,731 | ||||||||||||||||
Series A Preferred Stock [Member] | ||||||||||||||||||
Stockholders' Equity [Line Items] | ||||||||||||||||||
Preferred stock, shares authorized | 2,000,000 | 2,000,000 | 2,000,000 | 2,000,000 | ||||||||||||||
Dividend rate | 10.00% | 10.00% | ||||||||||||||||
Automatic conversion period | 5 years | |||||||||||||||||
Preferred stock dividend shares accrued | 181,699 | 89,275 | ||||||||||||||||
Preferred stock dividends, shares issued | 181,699 | |||||||||||||||||
Series B Preferred Stock [Member] | ||||||||||||||||||
Stockholders' Equity [Line Items] | ||||||||||||||||||
Preferred stock, shares authorized | 1,000,000 | 1,000,000 | 1,000,000 | 1,000,000 | ||||||||||||||
Dividend rate | 10.00% | 10.00% | ||||||||||||||||
Automatic conversion period | 5 years | |||||||||||||||||
Preferred stock dividend shares accrued | 100,000 | 46,987 | ||||||||||||||||
Preferred stock dividends, shares issued | 100,000 | |||||||||||||||||
Series C Convertible Preferred Stock [Member] | ||||||||||||||||||
Stockholders' Equity [Line Items] | ||||||||||||||||||
Preferred stock, shares authorized | 2,000,000 | |||||||||||||||||
Dividend rate | 10.00% | 10.00% | ||||||||||||||||
Automatic conversion period | 5 years | |||||||||||||||||
Preferred stock dividend shares accrued | 180,000 | 84,576 | ||||||||||||||||
Preferred stock dividends, shares issued | 180,000 | |||||||||||||||||
Series D Preferred Stock [Member] | ||||||||||||||||||
Stockholders' Equity [Line Items] | ||||||||||||||||||
Preferred stock, shares authorized | 2,000,000 | 2,000,000 | 2,000,000 | 2,000,000 | ||||||||||||||
Dividend rate | 10.00% | 10.00% | ||||||||||||||||
Preferred stock dividend shares accrued | 39,863 | 23,493 | ||||||||||||||||
Preferred stock dividends, shares issued | 39,863 | |||||||||||||||||
Series C Preferred Stock [Member] | ||||||||||||||||||
Stockholders' Equity [Line Items] | ||||||||||||||||||
Preferred stock, shares authorized | 2,000,000 | 2,000,000 | 2,000,000 | |||||||||||||||
Consulting [Member] | ||||||||||||||||||
Stockholders' Equity [Line Items] | ||||||||||||||||||
Stock Issued for services, shares | 7,000 | 3,600 | 3,600 | 7,000 | 7,000 | |||||||||||||
Common stock price per share | $ 0.695 | $ 0.85 | $ 0.75 | $ 0.67 | $ 0.695 | |||||||||||||
Common stock issued for services | $ 4,865 | $ 3,060 | $ 2,700 | $ 4,690 | $ 4,865 | |||||||||||||
Law Firm [Member] | ||||||||||||||||||
Stockholders' Equity [Line Items] | ||||||||||||||||||
Stock Issued for services, shares | 50,000 | |||||||||||||||||
Common stock price per share | $ 0.695 | |||||||||||||||||
Common stock issued for services | $ 34,750 | |||||||||||||||||
Executive Officer and Director [Member] | ||||||||||||||||||
Stockholders' Equity [Line Items] | ||||||||||||||||||
Stock options granted | 100,000 | |||||||||||||||||
Stock options, exercise price | $ 0.695 | |||||||||||||||||
Fair value of options granted | $ 39,901 | |||||||||||||||||
Fair value of options granted per option | $ 0.3990 | |||||||||||||||||
Vesting period | 10 years | |||||||||||||||||
Director [Member] | ||||||||||||||||||
Stockholders' Equity [Line Items] | ||||||||||||||||||
Stock options granted | 46,000 | |||||||||||||||||
Stock options, exercise price | $ 0.695 | |||||||||||||||||
Fair value of options granted | $ 18,354 | |||||||||||||||||
Fair value of options granted per option | $ 0.3990 | |||||||||||||||||
Vesting period | 10 years | |||||||||||||||||
Private Placement Memorandum [Member] | ||||||||||||||||||
Stockholders' Equity [Line Items] | ||||||||||||||||||
Stock issued during period for cash, shares | 1,000,000 | |||||||||||||||||
Stock issued during period for cash | $ 500,000 | |||||||||||||||||
Common stock issued for cash, price per share | $ 0.50 | |||||||||||||||||
2011 Plan [Member] | ||||||||||||||||||
Stockholders' Equity [Line Items] | ||||||||||||||||||
Shares reserved for issuance | 900,000 | |||||||||||||||||
Shares remaining for future issuance | 0 | 0 | ||||||||||||||||
Maximum allowable annual shares granted to any individual | 180,000 | |||||||||||||||||
2013 Plan [Member] | ||||||||||||||||||
Stockholders' Equity [Line Items] | ||||||||||||||||||
Shares reserved for issuance | 900,000 | |||||||||||||||||
Shares remaining for future issuance | 0 | 0 | ||||||||||||||||
Maximum allowable annual shares granted to any individual | 180,000 | |||||||||||||||||
2015 Plan [Member] | ||||||||||||||||||
Stockholders' Equity [Line Items] | ||||||||||||||||||
Shares reserved for issuance | 1,000,000 | 1,000,000 | ||||||||||||||||
Shares remaining for future issuance | 551,000 | 551,000 |
SHAREHOLDERS' EQUITY (Schedule
SHAREHOLDERS' EQUITY (Schedule of Fair Value Assumptions for Stock Options) (Details) - Stock Option [Member] | 6 Months Ended | |
Jun. 30, 2016 | Jun. 30, 2015 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Expected life (years) | 6 years 9 months 18 days | 6 years 3 months |
Expected volatility | 66.00% | 63.00% |
Risk-free interest rate, minimum | 0.01% | 0.38% |
Risk-free interest rate, maximum | 2.07% | |
Dividend yield | 0.00% | 0.00% |
Expected forfeiture rate | 0.00% | 0.00% |
SHAREHOLDERS' EQUITY (Schedul37
SHAREHOLDERS' EQUITY (Schedule of Stock Option Activity) (Details) | 6 Months Ended |
Jun. 30, 2016USD ($)$ / sharesshares | |
Number of Options | |
Balance Outstanding, Beginning | shares | 1,701,000 |
Granted | shares | 146,000 |
Exercised | shares | |
Forfeited | shares | |
Expired | shares | |
Balance Outstanding, Ending | shares | 1,847,000 |
Exercisable, Ending | shares | 1,327,000 |
Weighted Average Exercise Price | |
Balance Outstanding, Beginning | $ / shares | $ 0.34 |
Granted | $ / shares | 0.70 |
Exercised | $ / shares | |
Forfeited | $ / shares | |
Expired | $ / shares | |
Balance Outstanding, Ending | $ / shares | 0.37 |
Exercisable, Ending | $ / shares | $ 0.28 |
Weighted Average Remaining Contractual Term | |
Outstanding, Beginning | 6 years 7 months 6 days |
Outstanding, Ending | 6 years 7 months 6 days |
Exercisable, Ending | 5 years 4 months 24 days |
Aggregate Intrinsic Value | |
Outstanding, Beginning | $ | $ 867,510 |
Outstanding, Ending | $ | 867,510 |
Exercisable, Ending | $ | $ 756,390 |
SHAREHOLDERS' EQUITY (Schedul38
SHAREHOLDERS' EQUITY (Schedule of Options Outstanding Under Option Plans) (Details) | 6 Months Ended |
Jun. 30, 2016$ / sharesshares | |
Options Outstanding | |
Number Outstanding | shares | 1,847,000 |
Remaining Average Contractual Life (in years) | 2 years 3 months 18 days |
Weighted Average Exercise Price | $ 0.37 |
Options Exercisable | |
Number Exercisable | shares | 1,327,000 |
Weighted Average Exercise Price | $ 0.09 |
0.14 - 0.24 [Member] | |
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range [Line Items] | |
Exercise price lower range limit | 0.14 |
Exercise price upper range limit | $ .24 |
Options Outstanding | |
Number Outstanding | shares | 720,000 |
Remaining Average Contractual Life (in years) | 1 year 8 months 12 days |
Weighted Average Exercise Price | $ 0.05 |
Options Exercisable | |
Number Exercisable | shares | 720,000 |
Weighted Average Exercise Price | $ 0.08 |
0.25 - 0.49 [Member] | |
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range [Line Items] | |
Exercise price lower range limit | 0.25 |
Exercise price upper range limit | $ 0.49 |
Options Outstanding | |
Number Outstanding | shares | 351,000 |
Remaining Average Contractual Life (in years) | 1 year 1 month 6 days |
Weighted Average Exercise Price | $ 0.05 |
Options Exercisable | |
Number Exercisable | shares | 297,000 |
Weighted Average Exercise Price | $ 0.06 |
0.50 - 0.78 [Member] | |
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range [Line Items] | |
Exercise price lower range limit | 0.50 |
Exercise price upper range limit | $ 0.78 |
Options Outstanding | |
Number Outstanding | shares | 776,000 |
Remaining Average Contractual Life (in years) | 3 years 6 months |
Weighted Average Exercise Price | $ 0.27 |
Options Exercisable | |
Number Exercisable | shares | 310,000 |
Weighted Average Exercise Price | $ 0.14 |
CONCENTRATIONS (Narrative) (Det
CONCENTRATIONS (Narrative) (Details) - USD ($) | 3 Months Ended | 6 Months Ended | |||
Jun. 30, 2016 | Jun. 30, 2015 | Jun. 30, 2016 | Jun. 30, 2015 | Dec. 31, 2015 | |
Cash balance insured by FDIC | $ 250,000 | $ 250,000 | |||
Cash balances above the insured limit | $ 0 | $ 0 | $ 0 | ||
Direct Product Sales [Member] | |||||
Concentration Risk, Percentage | 4.00% | 1.00% | |||
Revenue [Member] | Google AdSence [Member] | |||||
Concentration Risk, Percentage | 23.00% | 57.00% | |||
Remaining Advertising Revenue [Member] | |||||
Concentration Risk, Percentage | 77.00% | 43.00% | |||
Accounts Receivable [Member] | Google AdSence [Member] | |||||
Concentration Risk, Percentage | 19.00% | ||||
Accounts Receivable [Member] | INFORM [Member] | |||||
Concentration Risk, Percentage | 19.00% | ||||
Accounts Receivable [Member] | Medium Corporation [Member] | |||||
Concentration Risk, Percentage | 12.00% | ||||
Citizens Watch Company of America, Inc [Member] | Purchases [Member] | |||||
Concentration Risk, Percentage | 44.00% | 39.00% | 39.00% | 39.00% | |
Bulova Corporation [Member] | Purchases [Member] | |||||
Concentration Risk, Percentage | 15.00% | 22.00% | 17.00% | 29.00% | |
Amazon [Member] | Sales Revenue, Net [Member] | |||||
Concentration Risk, Percentage | 91.00% | 78.00% | 91.00% | 77.00% | |
eBay [Member] | Sales Revenue, Net [Member] | |||||
Concentration Risk, Percentage | 5.00% | 2.00% | 5.00% | 3.00% |
SUBSEQUENT EVENTS (Narrative) (
SUBSEQUENT EVENTS (Narrative) (Details) | Aug. 10, 2016USD ($) | Jul. 12, 2016number$ / sharesshares | Jan. 15, 2016shares | Jul. 20, 2016shares | Jul. 18, 2016USD ($)ft² | Jun. 20, 2016shares | May 16, 2016shares | Apr. 15, 2016shares | Feb. 15, 2016shares | Jun. 30, 2016USD ($)$ / sharesshares | Jun. 30, 2015USD ($) | Jul. 25, 2016USD ($)$ / shares | Jul. 07, 2016USD ($)$ / shares |
Granted shares | shares | 146,000 | ||||||||||||
Granted shares executable per share | $ / shares | $ 0.70 | ||||||||||||
Rent expense per year | $ | $ 80,732 | $ 48,273 | |||||||||||
Consulting [Member] | |||||||||||||
Issued common stock for services | shares | 7,000 | 3,600 | 3,600 | 7,000 | 7,000 | ||||||||
Subsequent Event [Member] | |||||||||||||
Area of real estate space | ft² | 2,720 | ||||||||||||
Lease terms | 5 years | ||||||||||||
Rent expense per year | $ | $ 43,438 | ||||||||||||
Rent percentage increase per year | 3.00% | ||||||||||||
Subsequent Event [Member] | Consulting [Member] | |||||||||||||
Issued common stock for services | shares | 3,600 | ||||||||||||
Issued common stock for services, per sahres | shares | 0.85 | ||||||||||||
Subsequent Event [Member] | Principal shareholder [Member] | |||||||||||||
Raised capital | $ | $ 60,000 | ||||||||||||
Sale of common stock in a private transaction | $ | $ 120,000 | ||||||||||||
Subsequent Event [Member] | Ten-year stock options [Member] | Board of Directors [Member] | |||||||||||||
Granted shares | shares | 340,000 | ||||||||||||
Number of employees | number | 5 | ||||||||||||
Vesting Period | 4 years | ||||||||||||
Granted shares executable per share | $ / shares | $ 0.85 | ||||||||||||
Convertible Notes Payable [Member] | Subsequent Event [Member] | |||||||||||||
Convertible notes | $ | $ 50,000 | $ 50,000 | |||||||||||
Interest Bearing rate | 12.00% | 12.00% | |||||||||||
Convertible notes, per share | $ / shares | $ 0.50 | $ 0.50 |