Amerinac Holding (PAOS) 10-Q 11 Aug 17 2017 Q2 Quarterly report Financial data

Document and Entity Information

Document and Entity Information - shares	6 Months Ended
	Jun. 30, 2017	Aug. 10, 2017
Document And Entity Information
Entity Registrant Name	AMERINAC HOLDING CORP.
Entity Central Index Key	936,446
Document Type	10-Q
Document Period End Date	Jun. 30, 2017
Amendment Flag	false
Current Fiscal Year End Date	--12-31
Is Entity a Well-known Seasoned Issuer?	No
Is Entity a Voluntary Filer?	No
Is Entity's Reporting Status Current?	Yes
Entity Filer Category	Smaller Reporting Company
Entity Common Stock, Shares Outstanding		286,636
Document Fiscal Period Focus	Q2
Document Fiscal Year Focus	2,017

CONDENSED CONSOLIDATED BALANCE

CONDENSED CONSOLIDATED BALANCE SHEETS - USD ($)	Jun. 30, 2017	Dec. 31, 2016
Current assets:
Cash	$ 1,131,275	$ 83,391
Accounts receivable (net of allowance for doubtful accounts of $43,947 as of June 30, 2017 and December 31, 2016	1,043,389	720,421
Inventories (net of reserve for obsolesence of $149,719 and $89,080 as of June 30, 2017 and December 31, 2016, respectively	1,897,414	1,797,061
Escrow receivable	1,000,000
Current assets - discontinued operations		8,469,472
Escrow deposit	500,000
Other current assets	264,200	81,285
Total Current Assets	5,836,278	11,151,630
Property and equipment - net	54,152	142,167
Other assets
Other	3,382	6,798
Long-term assets - discontinued operations		44,948
Total other assets	3,382	51,746
Total	5,893,812	11,345,543
Current liabilities:
Line of credit	497,438	5,292,366
Accounts payable and accrued expenses	858,779	1,016,963
Shareholder put option		687,000
Income taxes payable	22,831	22,100
Current liabilities - discontinued operations		1,646,448
Total current liabilities	1,379,048	8,664,877
Long-term liabilities - notes payable		3,800,489
Total liabilities	1,379,048	12,465,366
Stockholders' equity (deficiency):
Common stock, $.001 par value; 1,500,000 shares authorized, 358,333 issued and 261,636 outstanding at June 30, 2017 and 298,867 issued and outstanding at December 31, 2016.	358	299
Treasury stock, $.001 par value; 96,697 shares held in treasury	(97)
Additional paid-in capital	14,119,501	12,070,996
Accumulated deficit	(9,604,998)	(13,191,118)
Total stockholders' equity (deficiency)	4,514,764	(1,119,823)
Total liabilities and stockholders' equity (deficiency)	$ 5,893,812	$ 11,345,543

CONDENSED CONSOLIDATED BALANCE3

CONDENSED CONSOLIDATED BALANCE SHEETS (Parenthetical) - USD ($)	Jun. 30, 2017	Dec. 31, 2016
Current assets:
Net of allowance for doubtful accounts	$ 43,947	$ 43,947
Net of reserve for obsolesence	$ 149,719	$ 89,080
Stockholders' equity (deficiency):
Common Stock Par Value	$ 0.001	$ 0.001
Common Stock Authorized	1,500,000	1,500,000
Common Stock Issued	358,333	298,867
Common Stock Outstanding	261,636	298,867
Treasury stock, Shares	96,697	96,697
Treasury stock, Par Value	$ .001	$ .001

CONDENSED CONSOLIDATED STATEMEN

CONDENSED CONSOLIDATED STATEMENTS OF INCOME (Unaudited) - USD ($)	3 Months Ended		6 Months Ended
	Jun. 30, 2017	Jun. 30, 2016	Jun. 30, 2017	Jun. 30, 2016
Condensed Consolidated Statements Of Income
Net revenue	$ 2,249,287	$ 2,624,058	$ 4,133,305	$ 4,871,975
Cost of goods sold	1,835,492	1,893,803	3,295,704	3,417,913
Gross profit	413,795	730,255	837,601	1,454,062
Operating expenses:
General and administrative expenses	539,080	395,497	945,923	681,885
Professional and consulting fees	179,646	38,074	204,111	70,793
Depreciation and amortization	15,078		22,616
Total operating expenses	733,804	433,571	1,172,650	752,678
(Loss) income before other (expense) income	(320,009)	296,684	(335,049)	701,384
Other income (expense)
Interest	(193,126)	(91,216)	(263,372)	(168,305)
Change in fair value put option			(213,000)	154,150
Gain on sale	3,409,184		3,409,184
Other expense	(5,925)		(3,765)
Total other income (expense)	3,210,133	(91,216)	2,929,047	(14,155)
Income from continuing operations before provision for income taxes	2,890,124	205,468	2,593,998	687,229
Provision for income taxes		(10,437)	(731)	(50,019)
Income from continuing operations	2,890,124	195,031		637,210
Discontinued operations:
Income (loss) from discontinued operations, net	775,689	(83,324)	992,853	(145,568)
Net income applicable to common stockholders	$ 3,665,813	$ 111,707	$ 3,586,120	$ 491,642
Basic earnings per share applicable to common stockholders:
Continuing operations	$ 9.65	$ 4.57	$ 8.67	$ 15.46
Discontinued operations	2.59	(1.95)	3.32	(3.53)
Net income	12.24	2.62	11.99	11.93
Diluted earnings per share applicable to common stockholders:
Continuing operations	9.65	4.57	8.67	15.46
Discontinued operations	2.59	(1.95)	3.32	(3.53)
Net income	$ 12.24	$ 2.62	$ 11.99	$ 11.93
Weighted average shares outstanding:
Basic	299,422	42,648	299,146	41,225
Diluted	299,422	42,648	299,146	41,225

CONDENSED CONSOLIDATED STATEME5

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited) - USD ($)	6 Months Ended
	Jun. 30, 2017	Jun. 30, 2016
CASH FLOWS FROM OPERATING ACTIVITIES
Net income	$ 3,586,120	$ 491,642
Adjustments to reconcile net income to net cash provided by (used in) operating activities:
Depreciation and amortization	22,616
Amortization of deferred financing fees	217,762	48,259
Gain on sale	(3,409,184)
Stock compensation	28,467	3,163
(Income) loss from discontinued operations	(992,853)	145,568
Change in fair value put option	213,000	(154,150)
Inventory writedown and reserve	60,639	38,005
Changes in assets and liabilities:
(Increase) in accounts receivable	(322,968)	(333,429)
(Increase) decrease in inventory	(160,995)	84,450
(Increase) in other current assets	(682,915)	(91,604)
Decrease in other assets	3,416	(500)
Increase in income taxes payable	731	50,336
Decrease in accounts payable and accrued expenses	(158,184)	(71,524)
Net cash provided by operating activities of continuing operations	(1,594,348)	210,216
Net cash provided by (used in) operating activities of discontinued operations	1,122,359	(209,274)
Net cash provided by operating activities	(471,989)	942
CASH FLOWS FROM INVESTING ACTIVITIES
Proceeds from sale, net of escrow	9,500,000
Purchase of property and equipment	(1,349)	(28,862)
Net cash used in investing activities of continuing operations	9,498,651	(28,862)
Net cash provided by (used in) investing activities of discontinued operations		(41,348)
Net cash provided by (used in) investing activities	9,498,651	(70,210)
CASH FLOWS FROM FINANCING ACTIVITIES
Net (payments) proceeds on line of credit	(4,813,178)	52,128
Payments on notes payable	(4,000,000)
Proceeds from issuance of stock, net	1,734,400	68,257
Purchase of treasury stock	(900,000)
Payments on shareholder loan		(84,509)
Net cash (used in) provided by financing activities of continuing operations	(7,978,778)	35,876
INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS	1,047,884	(33,392)
CASH AND CASH EQUIVALENTS - BEGINNING OF PERIOD	83,391	81,941
CASH AND CASH EQUIVALENTS - END OF PERIOD	1,131,275	48,549
Cash paid during the period for:
Interest	313,037	388,931
Income taxes		4,195
Non-cash financing activities:
Stock issued for payment of debt	$ 85,600

SUMMARY OF BUSINESS

SUMMARY OF BUSINESS	6 Months Ended
	Jun. 30, 2017
Notes to Financial Statements
1. SUMMARY OF BUSINESS	Amerinac Holding Corp. and Subsidiaries (the “Company”) distributes high-quality, predominantly domestically-manufactured, technically complex, nut and bolt products and a proprietary locking washer product that are used primarily for aerospace and military applications and for industrial/commercial applications that require a high level of certified and assured quality. The Company's operations are carried out through its wholly-owned distribution subsidiary Creative Assembly Systems, Inc (“Creative Assembly”). Until April 28, 2017, the Company’s operations were also carried out through its wholly-owned distribution subsidiary, Aero-Missile Components, Inc. (“Aero-Missile”). Creative Assembly is a value added distributor of proprietary and specialty fasteners primarily serving the heavy truck, automotive, transportation, and infrastructure industries. Aero-Missile had stocking distributor relationships with a number of United States fastener manufacturers. Aero-Missile predominantly soldto all levels of the aviation industry original equipment manufacturers, maintenance and repair organizations, and other distributors, as well as to the United States Department of Defense (“Department of Defense”).In the first quarter of 2016, the Company’s wholly owned subsidiary, Freundlich Supply Company, Inc. (“Freundlich”), was merged into Aero-Missile and Tiger-Tight Corp. (“Tiger-Tight”) was merged into Creative Assembly. On October 18, 2016, the Company completed a 1-for-2500 reverse stock split. No fractional shares were issued. Shareholders received $0.02 in consideration for each “pre-split” share of a fractional share. Amounts for the Company’s historical (pre-reverse stock split) common stock including share and per share amounts have been retroactively adjusted using the respective ratio of 1-for-2500 in these financial statements, unless otherwise disclosed and indicated. On April 28, 2017, the Company and Aero-Missile entered into an Asset Purchase Agreement (the “Aero-Missile Asset Purchase Agreement”) with Apollo Aerospace LLC (“Apollo”) pursuant to which Aero-Missile sold substantially all of its assets to Apollo and Apollo assumed certain liabilities of Aero-Missile (the “Asset Sale”) for an aggregate purchase price of $10.5 million paid by Apollo to Aero-Missile. The purchase price is subject to a working capital adjustment and $1.0 million being held in escrow to secure the indemnification obligations of the Company and Aero-Missile. No payments were made to or from the Company pursuant to the working capital adjustment contained within the Aero-Missile Asset Purchase Agreement. Pursuant to the Aero-Missile Asset Purchase Agreement, the Company and Aero-Missile were required to change their corporate names. On May 1, Aero-Missile changed its name to “PolyAero Inc.” and on June 28, 2017, the Company changed its name to “Amerinac Holding Corp.” Simultaneous with the sale of Asset Sale, the Company repaid all amounts owing to C3 Capital Partners III, L.P. (“C3”) under Note A and Note B. The total amount repaid was $4 million plus accrued interest of $42,389. In addition, the Company purchased the 96,697 shares of common stock of the Company owned by C3 for an aggregate purchase price of $900,000that was mutually agreed to by the Company and C3. On April 28, 2017, the balance of the proceeds of the Asset Sale discussed above, totaling $4,557,611, were used to partially pay down the principal balance of the WBCC Revolving Loan. Although the WBCC Revolving Loan was senior to Note A and B, WBCC consented to the early repayment of these loans in full. WBCC required a fee of $37,500 to consent. All financial results of Aero-Missile are classified as discontinued operations for the purposes of this quarterly report and all assets of Aero-Missile are classified as discontinued operations for the periods presented in this quarterly report. On July 12, 2017, the Company entered into an Asset Purchase Agreement (the “Prime Asset Purchase Agreement”) with Prime Metals & Alloys, Inc., a Delaware corporation, (“Prime Metals”) pursuant to which a newly created subsidiary of the Company will purchase all of the assets of Prime Metals for an aggregate purchase price of $9.6 million pursuant to an order of the Bankruptcy Court approving the sale under Section 363 of the Bankruptcy Code. On March 2, 2017, Prime Metals filed a voluntary petition for relief under chapter 11 of title of the United States Code (as amended, the “Bankruptcy Code”) in the United States Bankruptcy Court for the Western District of Pennsylvania (the “Bankruptcy Court”) at case no. 17-70164-JAD. Pursuant to an order of the Bankruptcy Court, on June 26, 2017, the Company paid a deposit of $0.5million to be held in escrow. The deposit will be credited to the purchase price at Closing. On July 17, 2017, the Company completed the final closing of a private placement (the “Private Placement”) with approximately 17 accredited investors (the “Investors”), pursuant to which the Company sold to the Investors a total of 75,500 shares of restricted common stock (the “Shares”) of the Company at a purchase price of $40.00 per share, and total consideration of $3.02 million. The Shares were offered and sold in reliance upon exemptions from registration under the Securities Act of 1933, as amended (the “Securities Act”) in reliance on Section 4(2) of the Securities Act and Rule 506 of Regulation D promulgated thereunder, as transactions by an issuer not involving a public offering. As of June 30, 2017, the Company had raised $2.02 million through the sale of 50,500 Shares. The remaining 25,000 Shares were sold between July 1, 2017 and July 17, 2017 for $1.0 million. The Shares of common stock have not been registered under the Securities Act and may not be transferred or resold unless the transfer or resale is registered or unless exemptions from the registration requirements of the Securities Act and applicable state laws are available.

SUMMARY OF SIGNIFICANT ACCOUNTI

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES	6 Months Ended
	Jun. 30, 2017
Notes to Financial Statements
2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES	Interim Consolidated Financial Statements The accompanying unaudited condensed consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”) and in conformity with the instructions to Form 10-Q and Article 8 of Regulation S-X and the related rules and regulations of the Securities and Exchange Commission (“SEC”). Accordingly, certain information and note disclosures normally included in financial statements prepared in accordance with GAAP have been condensed or omitted pursuant to such rules and regulations. However, we believe that the disclosures included in these consolidated financial statements are adequate to make the information presented not misleading. The unaudited condensed consolidated financial statements included in this document have been prepared on the same basis as the annual consolidated financial statements, and in the Company’s opinion reflect all adjustments, which include normal recurring adjustments necessary for a fair presentation in accordance with GAAP and SEC regulations for interim financial statements. The results for the six months ended June 30, 2017 are not necessarily indicative of the results that the Company will have for any subsequent period. These unaudited condensed consolidated financial statements should be read in conjunction with the audited consolidated financial statements and the notes thereto for the year ended December 31, 2016 included in the Company’s Annual Report on Form 10-K filed on March31, 2017. Earnings (Loss) Per Share Basic earnings (loss) per share is calculated by dividing net profit attributable to common stockholders by the weighted average number of outstanding common shares during the year. Basic earnings (loss) per share excludes any dilutive effects of options, warrants and other stock-based compensation, which are included in diluted earnings per share. When a company is in a loss situation, all outstanding dilutive shares are excluded from the calculation of diluted earnings because their inclusion would be antidilutive; and the basic and fully diluted common shares outstanding are stated to be the same. There were no dilutive shares as of June 30, 2017 and 2016, respectively. Treasury Stock Treasury stock purchases are accounted for under the constructive retirement method whereby the par value of the acquired stock is recorded as treasury stock. Gains and losses on subsequent reissuance of shares are credited or charged to paid-in capital in excess of par value using the average-cost method. Use of Estimates The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting periods. Actual results could differ from those estimates. The significant estimates are the useful lives of fixed assets, reserves for inventory and accounts receivable. Inventory In July 2015, the FASB issued ASU No. 2015-11, Inventory (Topic 330): Simplifying the Measurement of Inventory Inventories are carried at the lower of cost or net realizable value. When necessary, management records an inventory reserve for estimated obsolescence or unmarketable inventory based upon knowledge of future demand of inventory on hand as well as other market conditions and events. As of December 31, 2016 and June30, 2017, the inventory reserve was $89,080and$149,719, respectively. Concentration of Credit Risk For the six month period ending June30, 2017, sales to PACCAR accounted for 51% of total sales, versus 47% of sales for the prior six month period ending June30, 2016.For the six month period ending June30, 2017, sales to Waterous accounted for 13% of total sales, versus 11% of sales for the prior six month period ending June30, 2016. At June30, 2017, PACCAR receivables were $512,711, which accounted for 49% of total receivables. At December 31, 2016, PACCAR receivables were $338,368, which accounted for 47%. Concentration of Suppliers The Company’s largest supplier, AVK Industrial Products, represents approximately 27% of product distributed for the six months ending June30, 2017, versus 31%for the six months ending June30, 2016. For nearly all suppliers, the Company looks to have secondary supply outlets. However, manufacturing issues with any supplier could cause temporary disruptions to the Company. AVK represented 40% and 25% of accounts payable at June30, 2017, and December 31, 2016, respectively. For the six months ending June 30, 2016, Brighton Best Sockets accounted for 17% of purchases. Fair Value of Financial Assets and Liabilities In accordance with the authoritative guidance for fair value measurements and the fair value election for financial assets and financial liabilities, a fair value measurement is determined based on the assumptions that a market participant would use in pricing an asset or liability. A three-tiered hierarchy was established that draws a distinction between market participant assumptions based on the following: i) observable inputs such as quoted prices in active markets (Level 1) ii) inputs other than quoted prices in active markets that are observable either directly or indirectly (Level 2) iii) unobservable inputs that require the Company to use present value and other valuation techniques in the determination of fair value (Level 3). Financial assets and liabilities are classified in their entirety based on the lowest level of input that is significant to the fair value measurement. The Company’s assessment of the significance of a particular input to the fair value measurements requires judgment, and may affect the valuation of the assets and liabilities being measured and their placement within the fair value hierarchy. Income Taxes The Company provides for income taxes under ASC Topic 740-10. ASC Topic 740-10 requires the use of an asset and liability approach in accounting for income taxes. Deferred tax assets and liabilities are recorded based on the differences between the financial statement and tax bases of assets and liabilities and the tax rates in effect when these differences are expected to reverse. Temporary differences relate primarily to different accounting methods used for depreciation and amortization of property and equipment and recording the inventory reserve. ASC Topic 740-10 requires the reduction of deferred tax assets by a valuation allowance if, based on the weight of available evidence, it is more likely than not that some or all of the deferred tax assets will not be realized. ASC Topic 740-10 clarifies the accounting for uncertainty in income tax positions, as defined. It requires, among other matters, that the Company recognize in our financial statements, the impact of a tax position, if that position is more likely than not of being sustained on audit, based on the technical merits of the position. The Company analyzes the filing positions in all of the federal and state jurisdictions where the Company is required to file income tax returns, as well as all open tax years in these jurisdictions. As of June 30, 2017, the Company did not record any unrecognized tax benefits. The Company's policy, if it had unrecognized benefits, is to recognize accrued interest and penalties related to unrecognized tax benefits as interest expense and other expense, respectively. Revenue Recognition Revenue is recognized when persuasive evidence of an arrangement exists, delivery has occurred or services have been rendered, the fee is fixed and determinable and collectability is reasonably assured. The Company recognizes revenue when product is shipped or when it is received by the customer, depending on the contractual terms.

DISCONTINUED OPERATIONS

DISCONTINUED OPERATIONS	6 Months Ended
	Jun. 30, 2017
Notes to Financial Statements
3. DISCONTINUED OPERATIONS	The financial results of our Aero-Missile business,sold on April 28, 2017, for the three and six months ended June 30, 2017 and 2016 are presented as discontinued operations, net of income taxes on our condensed consolidated statement of income. The following table presents financial results of the Aero-Missile business: Six Months Ended June 30, Three Months Ended June 30, 2017 2016 2017 2016 Net Revenue $ 5,839,989 $ 7,210,636 $ 1,066,399 $ 3,493,952 Cost of goods sold 4,048,651 5,713,741 275,494 2,881,552 Gross profit 1,791,338 1,496,895 790,905 612,400 Operating expenses: General and administrative expenses 443,771 1,291,122 9,470 494,106 Professional and consulting fees 56,796 89,894 1,056 51,684 Depreciation and amortization 9,132 7,079 5,909 4,118 Total operating expenses 509,699 1,388,095 16,435 549,908 Income before other income (expense) 1,281,639 108,800 774,470 62,492 Other income (expense) Interest expense - net (282,861 ) (251,585 ) (115,475 ) (128,970 ) Other expense (5,925 ) (692 ) 1 (692 ) Total other income (expense) (288,786 ) (252,277 ) (115,474 ) (129,662 ) Income before provision for income taxes 992,853 (143,477 ) 658,996 (67,170 ) Provision for state income taxes - (2,091 ) 116,693 (16,154 ) Net Income (loss) of discontinued operations 992,853 (145,568 ) 775,689 (83,324 ) April 28, 2017 December 31, 2016 Current assets of discontinued operations Accounts receivable 1,298,399 1,264,649 Inventories 6,957,866 7,184,868 Prepaid expenses 25,362 19,955 Total current assets 8,281,627 8,469,472 Long term assets of discontinued operations Plant, property and equipment - net 100,774 44,448 Other long term assets 3,525 500 104,299 44,948 Current liabilities of discontinued operations: Accounts payable 1,285,200 1,560,776 Accrued expenses 9,910 85,672 Total current liabilities 1,295,110 1,646,448 Net assets sold above were approximately $7,091,000, resulting in a gain on sale of approximately $3,409,000 as a result of $10,500,000 sale price. There was no tax due to deferred tax assets for inventory reserves.

LONG-TERM DEBT AND LINE OF CRED

LONG-TERM DEBT AND LINE OF CREDIT	6 Months Ended
	Jun. 30, 2017
Notes to Financial Statements
4. LONG-TERM DEBT AND LINE OF CREDIT	Securities Purchase Agreement On the January 16, 2015, (the “Effective Date”), the Company and its Subsidiaries entered into a Securities Purchase Agreement (the “Securities Purchase Agreement) with C3, pursuant to which the Company and its Subsidiaries authorized the issuance and sale to C3 of (1) a Senior Secured Note issued by the Subsidiaries in the amount of $5,500,000 (“Note A”), (2) a Subordinated Secured Note issued by the Subsidiaries in the amount of $3,500,000 (“Note B”), and (3) 3,200shares of unregistered Common Stock for a loan from C3. Note Aaccruedat11% interest per annum, with 10% payable monthly and 1% accruing to the outstanding balance of Note A, payable at maturity. Note A had a Maturity Date of January 16, 2020. Note A was secured against all of the assets of the Company and its Subsidiaries. Note A was repaid in full on April 28, 2017. Note B accrued at 14% interest per annum. Note B had a Maturity Date of January 16, 2020. Note B was secured against all of the assets of the Company and its Subsidiaries. Note B was repaid in full on April 28, 2017. Notes A and B carried with them industry standard prepayment penalties. These prepayment penalties were waivedby C3 as part of the repurchase of the equity. The Company had granted C3 a put right under the Securities Purchase Agreement for the Common Stock C3 had received (whether by purchase or grant) at any time after the earlier to occur of (1) the fifth (5th ) anniversary of the closing of the Securities Purchase Agreement for Common Stock (for Granted Equity), (2) the seventh (7th) anniversary of the closing of the Securities Purchase Agreement (for Purchased Equity), (3) payment in full of the amounts owed under Note A and Note B, or (4) upon an Event of Default, as defined in the Securities Purchase Agreement. On April 28, 2017, the Company repurchased the 96,697 shares of Common Stock owned by C3 for an aggregate purchase price of $900,000. Consequently, C3 owns no shares of Common Stock of the Company and the put right has been cancelled. Refinancing with Webster Business Credit Corporation On August 25, 2015, the Company established a new revolving credit facility in an aggregate principal amount of up to $7,500,000 (the "WBCC Revolving Loan") by entering into a Credit Agreement (the "WBCC Credit Agreement") with Webster Business Credit Corporation, as Lender ("WBCC"). The Company's wholly owned subsidiaries Aero-Missile Components, Inc., and Creative Assembly Systems serve as guarantors of the WBCC Revolving. Borrowings under the WBCC Revolving Loan may be used to finance working capital and other general corporate purposes. Borrowings under the WBCC Credit Agreement bear interest, at the Company's election, at a rate tied to one of the following rates: (i) the prime lending rate plus 1.25% or (ii) the adjusted daily LIBOR rate plus 2.75%. For the sixmonths ending June 30, 2017, the effective interest rate was 4.3%. The outstanding principal amount of any borrowings under the WBCC Revolving Loan will be due and payable on August 25, 2018, subject to an earlier maturity date upon an event of default. The WBCC Credit Agreement contains usual and customary covenants for financings of this type, including, among other things: (i) requirements to deliver financial statements, other reports and notices; (ii) restrictions on indebtedness; (iii) restrictions on dividends, distributions and redemptions of equity and repayment of subordinated indebtedness; (iv) restrictions on liens; (v) restrictions on making certain payments; (vi) restrictions on investments; (vii) restrictions on asset dispositions and other fundamental changes; and (viii) restrictions on transactions with affiliates. The WBCC Credit Agreement contains certain financial covenants, including a minimum fixed charge coverage ratio. As of June 30, 2017, the Company was in compliance with these metrics. The obligations of the Company and its Subsidiaries under the WBCC Credit Agreement are secured by liens and security interests on all assets of the Company and its Subsidiaries, including a pledge of 100% of the equity of the Subsidiaries. Under the WBCC Credit Agreement, the Company is dependent upon its line of credit to maintain appropriate liquidity. All of the Company's cash flow from operations is required to be swept to its line of credit. The availability from its line is dependent upon accounts receivable and inventory. Under the WBCC Credit Agreement, the Company's interest rate for the WBCC Revolving Loan is linked to indices. Changes in the indices would cause an increase in interest expense. As of June 30, 2017 and December 31, 2016, the WBCCRevolving Loan had a principal balance of $526,021 and $5,339,199, respectively.Net of the origination and transaction costs being amortized the balance was $497,438 and $5,292,366. On the April 28, 2017, the Company entered into Amendment No. 2 to and Consent No.1 (the “Amendment and Consent”) under the WBCC Credit Agreement. Under the Amendment and Consent, WBCC amended the WBCC Credit Agreement and consented to the Asset Sale, the repayment of all amounts owing to C3, and the Stock Repurchase.On April 28, 2017, the balance of the proceeds of the Asset Sale totaling $4,557,611, were used to partially pay down the principal balance of the WBCC Revolving Loan. On July 31, 2017, the Company paid the remaining $209,406 due under the WBCC Credit Agreement and the WBCC Credit Agreement was terminated by mutual agreement. C3 Put C3 maintained their right to force the Company to repurchase its shares upon certain triggering events. The Company maintains a liability on its balance sheet that reflects the fair value of the put option. Prior to March 31, 2017, to arrive at this liability the Company performed a valuation based on comparable company metrics. This technique would be considered a Level 3 fair market value approach. The Company performed its valuation in accordance with FASB’s “ASC 820 – Fair Value Measurements.”The technique used was a multiple of earnings before interest, taxes, depreciation and amortization (“EBITDA”). The Company subtracted the total average outstanding debt and added back the available cash to arrive at the fair value of the put option. The Company made certain customary adjustments to EBITDA in order to provide a more accurate representation in regards to the Company’s financial situation. The Company recorded debt discount of $165,650 based on the C3 Put’s fair value at issuance on January 16, 2015. This amount was to be amortized over the life of the Company’s five year subordinated notes. As of March 31, 2017, the Company’s valuation estimate for the C3 Put was $900,000, which was based on the Company’s agreement subsequent to quarter end to repurchase C3’s shares for a total price of $900,000 in conjunction with an early repayment of the Note A and Note B. On April 28, 2017, the C3 Put was exercised and the Company repurchased96,697 shares of Common Stock owned by C3 for an aggregate purchase price of $900,000. The table below sets forth a summary of changes in the fair value of the Company's Level 3 financial liabilities: June30, 2017 Balance as of December31, 2016 $ 687,000 Mark to market adjustment 213,000 Balance as of June 30, 2017 $ 900,000 Repurchase of Stock (900,000 ) Balance as of June 30, 2017 $ 0

COMMITMENTS AND CONTINGENCIES

COMMITMENTS AND CONTINGENCIES	6 Months Ended
	Jun. 30, 2017
Notes to Financial Statements
5. COMMITMENTS AND CONTINGENCIES	Operating Leases The Company has two facilities, which are primarily office and warehouse space. These facilities are all leased under operating leases. One facility is currently under lease for less than one year, while the second facility is currently under lease for more than one year, calling for monthly rental payments of $3,533 through February 28, 2019. In some cases the Company is responsible for real estate taxes, utilities, and repairs under the terms of certain of the operating leases. Litigation The Company is subject to the possibility of claims and lawsuits arising in the normal course of business. In the opinion of management, the Company liability, if any, under existing claims, asserted or unasserted, would not have a material adverse effect on the Company’s consolidated financial position or results of operations. Employment Agreements During 2010, the Company entered into an employment agreement with its President and Chief Executive Officer. In the event of the termination of the agreement under certain circumstances the Company could be liable for up to twelve months' salary. On January 16, 2015, Andrew Prince resigned as President and Chief Executive Officer. In consideration for his resignation without termination payments, the Company entered into a two-year financial consulting agreement with Mr. Prince that entitled him to a minimum of $100,000 in consulting fees that were paid on January 16, 2017. The agreement terminated on its own accord and Mr. Prince is no longer affiliated with the Company in any capacity. On April 1, 2016, the Company appointed Victor Mondo as President of Aero-Missile. Mr. Mondo became Chief Executive Officer of the Company on July 18, 2016. In connection with his appointment, the Company and Mr. Mondo entered into a written employment agreement (the "Employment Agreement") for an initial three-year term, which providedcompensation terms for Mr. Mondo. As part of the divesture of Aero-Missile, Mr. Mondo’s compensation structure was altered. Pursuant to the updated Employment Agreement, Mr. Mondo will receive a base salary of $195,000 per year, subject to increase, but not decrease, at the discretion of the Board. Mr. Mondo is eligible for a cash bonus equal to 4% of Adjusted EBITDA over $1,000,000 at the end of each respective annual period. For the period ending June 30, 2017, the Company awarded Mondo a discretionary $60,000 cash bonus. In addition, Mr. Mondo was entitled to an award ofshares of the common stock of the Company equal to 3% of the total equity on a fully diluted basis, which were to fully vest on December 31, 2018. Pursuant to the updated Employment Agreement, Mr. Mondo’s shares vested fully on June 30, 2017, subject to various clawback provisions. As of the date of this report, 8,966 shares have been vested and issued to Mr. Mondo. Furthermore, Mr. Mondo is eligible to receive 3,800 shares of common stock, subject to certain growth metrics for each annual period. In addition, the Employment Agreement also provides for certain payments and benefits in the event of a termination of his employment under specific circumstances. If, during the term of the Employment Agreement, his employment is terminated by the Company other than for “cause,” death or disability or by Mr. Mondo for “good reason" (each as defined in the Employment Agreement), he would be entitledto (1) continuation of his base salary at the rate in effect immediately prior to the termination date for six (6) months following the termination date, and (2) any unpaid portion of any cash bonus for the annual period preceding the annual period in which such termination occurs that was earned but not paid.

RELATED PARTY TRANSACTIONS

RELATED PARTY TRANSACTIONS	6 Months Ended
	Jun. 30, 2017
Notes to Financial Statements
6. RELATED PARTY TRANSACTIONS	On January 16, 2015, the Company and Polymathes Capital, LLC(“Consultant”), an affiliate of Precision Group Holdings LLC (“Holdings”), our largest shareholder, entered into a Management Services Agreement whereby the Company engaged the Consultant to provide financing and management consulting services to the Company and its Subsidiaries on a month-to-month basis. Messrs John Wachter and William Golden are also affiliates of Polymathes Capital and Holdings. The consulting fee is $100,000 per annum, payable in monthly increments. On June 30, 2017, the Company accelerated the payment of management fees due for the second half of 2017.Pursuant to the Private Placement, Messrs Wachter and Golden decided to take 825 Shares each and Mr. Seamus Lamb chose to take 490 Shares at a purchase price of $40.00 per share in lieu of cash due to the Consultant under the Management Services Agreement for a total of $85,600 in non-cash consideration.

SUBSEQUENT EVENTS

SUBSEQUENT EVENTS	6 Months Ended
	Jun. 30, 2017
Notes to Financial Statements
7. SUBSEQUENT EVENTS	On July 12, 2017, the Company entered into an Asset Purchase Agreement (the “Prime Asset Purchase Agreement”) with Prime Metals & Alloys, Inc., a Delaware corporation, (“Prime Metals”) pursuant to which a newly created subsidiary of the Company will purchase all of the assets of Prime Metals for an aggregate purchase price of $9.6 million pursuant to an order of the Bankruptcy Court approving the sale under Section 363 of the Bankruptcy Code. On March 2, 2017, Prime Metals filed a voluntary petition for relief under chapter 11 of title of the United States Code (as amended, the “Bankruptcy Code”) in the United States Bankruptcy Court for the Western District of Pennsylvania (the “Bankruptcy Court”) at case no. 17-70164-JAD. Pursuant to an order of the Bankruptcy Court, the Company paid a deposit of $0.5 million to be held in escrow. The deposit will be credited to the purchase price at Closing. On July 17, 2017, the Company completed the final closing of a private placement (the “Private Placement”) with approximately 17 accredited investors (the “Investors”), pursuant to which the Company sold to the Investors a total of 75,500 shares of restricted common stock (the “Shares”) of the Company at a purchase price of $40.00 per share, and total consideration of $3.02 million. The Shares were offered and sold in reliance upon exemptions from registration under the Securities Act of 1933, as amended (the “Securities Act”) in reliance on Section 4(2) of the Securities Act and Rule 506 of Regulation D promulgated thereunder, as transactions by an issuer not involving a public offering. The subscription agreements executed in connection with the transactions disclosed above contain representations from the Investors to support our reasonable belief that: (i) the Investors either received or had access to adequate information concerning the Company’s operations and financial condition in order to make an informed investment decision, (ii) the Investors acquired the Shares for their own account for investment purposes only and not with a view to distribution thereof in the absence of an effective registration statement or an applicable exemption from registration, and (iii) the Investors are sophisticated within the meaning of Section 4(2) of the Securities Act and are “accredited investors” (as defined by Rule 501 under the Securities Act). The Shares of common stock have not been registered under the Securities Act and may not be transferred or resold unless the transfer or resale is registered or unless exemptions from the registration requirements of the Securities Act and applicable state laws are available. On July 31, 2017, the Company paid the remaining $209,406 due under the WBCC Credit Agreement and the WBCC Credit Agreement was terminated by mutual agreement

SUMMARY OF SIGNIFICANT ACCOUN13

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Policies)	6 Months Ended
	Jun. 30, 2017
Summary Of Significant Accounting Policies Policies
Interim Consolidated Financial Statements	The accompanying unaudited condensed consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”) and in conformity with the instructions to Form 10-Q and Article 8 of Regulation S-X and the related rules and regulations of the Securities and Exchange Commission (“SEC”). Accordingly, certain information and note disclosures normally included in financial statements prepared in accordance with GAAP have been condensed or omitted pursuant to such rules and regulations. However, we believe that the disclosures included in these consolidated financial statements are adequate to make the information presented not misleading. The unaudited condensed consolidated financial statements included in this document have been prepared on the same basis as the annual consolidated financial statements, and in the Company’s opinion reflect all adjustments, which include normal recurring adjustments necessary for a fair presentation in accordance with GAAP and SEC regulations for interim financial statements. The results for the six months ended June 30, 2017 are not necessarily indicative of the results that the Company will have for any subsequent period. These unaudited condensed consolidated financial statements should be read in conjunction with the audited consolidated financial statements and the notes thereto for the year ended December 31, 2016 included in the Company’s Annual Report on Form 10-K filed on March31, 2017.
Earnings (Loss) Per Share	Basic earnings (loss) per share is calculated by dividing net profit attributable to common stockholders by the weighted average number of outstanding common shares during the year. Basic earnings (loss) per share excludes any dilutive effects of options, warrants and other stock-based compensation, which are included in diluted earnings per share. When a company is in a loss situation, all outstanding dilutive shares are excluded from the calculation of diluted earnings because their inclusion would be antidilutive; and the basic and fully diluted common shares outstanding are stated to be the same. There were no dilutive shares as of June 30, 2017 and 2016, respectively.
Treasury Stock	Treasury stock purchases are accounted for under the constructive retirement method whereby the par value of the acquired stock is recorded as treasury stock. Gains and losses on subsequent reissuance of shares are credited or charged to paid-in capital in excess of par value using the average-cost method.
Use of Estimates	The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting periods. Actual results could differ from those estimates. The significant estimates are the useful lives of fixed assets, reserves for inventory and accounts receivable.
Inventory	In July 2015, the FASB issued ASU No. 2015-11, Inventory (Topic 330): Simplifying the Measurement of Inventory Inventories are carried at the lower of cost or net realizable value. When necessary, management records an inventory reserve for estimated obsolescence or unmarketable inventory based upon knowledge of future demand of inventory on hand as well as other market conditions and events. As of December 31, 2016 and June30, 2017, the inventory reserve was $89,080and$149,719, respectively.
Concentration of Credit Risk	For the six month period ending June30, 2017, sales to PACCAR accounted for 51% of total sales, versus 47% of sales for the prior six month period ending June30, 2016.For the six month period ending June30, 2017, sales to Waterous accounted for 13% of total sales, versus 11% of sales for the prior six month period ending June30, 2016. At June30, 2017, PACCAR receivables were $512,711, which accounted for 49% of total receivables. At December 31, 2016, PACCAR receivables were $338,368, which accounted for 47%.
Concentration of Suppliers	The Company’s largest supplier, AVK Industrial Products, represents approximately 27% of product distributed for the six months ending June30, 2017, versus 31%for the six months ending June30, 2016. For nearly all suppliers, the Company looks to have secondary supply outlets. However, manufacturing issues with any supplier could cause temporary disruptions to the Company. AVK represented 40% and 25% of accounts payable at June30, 2017, and December 31, 2016, respectively. For the six months ending June 30, 2016, Brighton Best Sockets accounted for 17% of purchases.
Fair Value of Financial Assets and Liabilities	In accordance with the authoritative guidance for fair value measurements and the fair value election for financial assets and financial liabilities, a fair value measurement is determined based on the assumptions that a market participant would use in pricing an asset or liability. A three-tiered hierarchy was established that draws a distinction between market participant assumptions based on the following: i) observable inputs such as quoted prices in active markets (Level 1) ii) inputs other than quoted prices in active markets that are observable either directly or indirectly (Level 2) iii) unobservable inputs that require the Company to use present value and other valuation techniques in the determination of fair value (Level 3). Financial assets and liabilities are classified in their entirety based on the lowest level of input that is significant to the fair value measurement. The Company’s assessment of the significance of a particular input to the fair value measurements requires judgment, and may affect the valuation of the assets and liabilities being measured and their placement within the fair value hierarchy.
Income Taxes	The Company provides for income taxes under ASC Topic 740-10. ASC Topic 740-10 requires the use of an asset and liability approach in accounting for income taxes. Deferred tax assets and liabilities are recorded based on the differences between the financial statement and tax bases of assets and liabilities and the tax rates in effect when these differences are expected to reverse. Temporary differences relate primarily to different accounting methods used for depreciation and amortization of property and equipment and recording the inventory reserve. ASC Topic 740-10 requires the reduction of deferred tax assets by a valuation allowance if, based on the weight of available evidence, it is more likely than not that some or all of the deferred tax assets will not be realized. ASC Topic 740-10 clarifies the accounting for uncertainty in income tax positions, as defined. It requires, among other matters, that the Company recognize in our financial statements, the impact of a tax position, if that position is more likely than not of being sustained on audit, based on the technical merits of the position. The Company analyzes the filing positions in all of the federal and state jurisdictions where the Company is required to file income tax returns, as well as all open tax years in these jurisdictions. As of June 30, 2017, the Company did not record any unrecognized tax benefits. The Company's policy, if it had unrecognized benefits, is to recognize accrued interest and penalties related to unrecognized tax benefits as interest expense and other expense, respectively.
Revenue Recognition	Revenue is recognized when persuasive evidence of an arrangement exists, delivery has occurred or services have been rendered, the fee is fixed and determinable and collectability is reasonably assured. The Company recognizes revenue when product is shipped or when it is received by the customer, depending on the contractual terms.

DISCONTINUED OPERATIONS (Tables

DISCONTINUED OPERATIONS (Tables)	6 Months Ended
	Jun. 30, 2017
Discontinued Operations Tables
Schedule of discontinued operations	Six Months Ended June 30, Three Months Ended June 30, 2017 2016 2017 2016 Net Revenue $ 5,839,989 $ 7,210,636 $ 1,066,399 $ 3,493,952 Cost of goods sold 4,048,651 5,713,741 275,494 2,881,552 Gross profit 1,791,338 1,496,895 790,905 612,400 Operating expenses: General and administrative expenses 443,771 1,291,122 9,470 494,106 Professional and consulting fees 56,796 89,894 1,056 51,684 Depreciation and amortization 9,132 7,079 5,909 4,118 Total operating expenses 509,699 1,388,095 16,435 549,908 Income before other income (expense) 1,281,639 108,800 774,470 62,492 Other income (expense) Interest expense - net (282,861 ) (251,585 ) (115,475 ) (128,970 ) Other expense (5,925 ) (692 ) 1 (692 ) Total other income (expense) (288,786 ) (252,277 ) (115,474 ) (129,662 ) Income before provision for income taxes 992,853 (143,477 ) 658,996 (67,170 ) Provision for state income taxes - (2,091 ) 116,693 (16,154 ) Net Income (loss) of discontinued operations 992,853 (145,568 ) 775,689 (83,324 )
Schedule of assets and liabilities	April 28, 2017 December 31, 2016 Current assets of discontinued operations Accounts receivable 1,298,399 1,264,649 Inventories 6,957,866 7,184,868 Prepaid expenses 25,362 19,955 Total current assets 8,281,627 8,469,472 Long term assets of discontinued operations Plant, property and equipment - net 100,774 44,448 Other long term assets 3,525 500 104,299 44,948 Current liabilities of discontinued operations: Accounts payable 1,285,200 1,560,776 Accrued expenses 9,910 85,672 Total current liabilities 1,295,110 1,646,448

LONG-TERM DEBT AND LINE OF CR15

LONG-TERM DEBT AND LINE OF CREDIT (Tables)	6 Months Ended
	Jun. 30, 2017
Long-term Debt And Line Of Credit Tables
Summary of changes in the fair value of the Company’s Level 3 financial liabilities	June30, 2017 Balance as of December31, 2016 $ 687,000 Mark to market adjustment 213,000 Balance as of June 30, 2017 $ 900,000 Repurchase of Stock (900,000 ) Balance as of June 30, 2017 $ 0

SUMMARY OF BUSINESS (Details Na

SUMMARY OF BUSINESS (Details Narrative) - USD ($)	1 Months Ended			6 Months Ended
	Jul. 17, 2017	Apr. 28, 2017	Oct. 18, 2016	Jun. 30, 2017	Jul. 12, 2017	Jun. 26, 2017	Dec. 31, 2016
Reverse stock split			1-for-2500
Shares Issued			$ 0.02
Aggregate purchase price				$ 900,000
Repurchase of common stock		96,697		96,697
Repaid amount				$ 4,000,000
Accrued interest				42,389
Proceeds of Asset		$ 4,557,611		4,557,611
Deposit escrow				500,000		$ 500,000
Proceed for rasied Price	$ 1,000,000			$ 2,020,000
Proceed for rasied common shares	25,000			50,500
Metals & Alloys, Inc., [Member]
Aggregate purchase price					$ 9,600,000
Investors [Member]
Aggregate purchase price	$ 40
Restricted common stock, Sold	75,500
Total consideration	$ 3,020,000
On April 28, 2017 [Member] | Apollo Aerospace LLC [Member]
Aggregate purchase price				$ 10,500,000
Working capital adjustment				1,000,000
Proceeds of Asset				4,557,611
Revolving Loan Fee required				$ 37,500

SUMMARY OF SIGNIFICANT ACCOUN17

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Details Narrative) - USD ($)	6 Months Ended		12 Months Ended
	Jun. 30, 2017	Jun. 30, 2016	Dec. 31, 2016	Mar. 31, 2017
Inventory Reserve	$ 149,719		$ 89,080
Brighton Best Sockets [Member]
Outstanding accounts receivable		17.00%
SPS Technologies and AVK [Member]
Concentration of suppliers, product distributed	27.00%	31.00%
Outstanding accounts payable	40.00%		25.00%
PACCAR Inc [Member]
Concentration of credit risk, total sales	51.00%	47.00%
Outstanding accounts receivable	49.00%
Waterous [Member]
Concentration of credit risk, total sales	13.00%	11.00%
PACCAR [Member]
Receivables			$ 338,368	$ 512,711
Outstanding accounts receivable			47.00%

DISCONTINUED OPERATIONS (Detail

DISCONTINUED OPERATIONS (Details) - USD ($)	3 Months Ended		6 Months Ended
	Jun. 30, 2017	Jun. 30, 2016	Jun. 30, 2017	Jun. 30, 2016
Net Revenue	$ 2,249,287	$ 2,624,058	$ 4,133,305	$ 4,871,975
Cost of goods sold	1,835,492	1,893,803	3,295,704	3,417,913
Gross profit	413,795	730,255	837,601	1,454,062
Operating expenses:
General and administrative expenses	539,080	395,497	945,923	681,885
Professional and consulting fees	179,646	38,074	204,111	70,793
Depreciation and amortization	15,078		22,616
Total operating expenses	733,804	433,571	1,172,650	752,678
Income before other income (expense)	(320,009)	296,684	(335,049)	701,384
Other income (expense)
Interest expense - net	(193,126)	(91,216)	(263,372)	(168,305)
Other expense	(5,925)		(3,765)
Total other income (expense)	3,210,133	(91,216)	2,929,047	(14,155)
Income before provision for income taxes	2,890,124	205,468	2,593,998	687,229
Provision for state income taxes		10,437	731	50,019
Net Income (loss) of discontinued operations	775,689	(83,324)	992,853	(145,568)
Discontinued Operations [Member]
Net Revenue	1,066,399	3,493,952	5,839,989	7,210,636
Cost of goods sold	275,494	2,881,552	4,048,651	5,713,741
Gross profit	790,905	612,400	1,791,338	1,496,895
Operating expenses:
General and administrative expenses	9,470	494,106	443,771	1,291,122
Professional and consulting fees	1,056	51,684	56,796	89,894
Depreciation and amortization	5,909	4,118	9,132	7,079
Total operating expenses	16,435	549,908	509,699	1,388,095
Income before other income (expense)	774,470	62,492	1,281,639	108,800
Other income (expense)
Interest expense - net	(115,475)	(128,970)	(282,861)	(251,585)
Other expense	1	(692)	(5,925)	(692)
Total other income (expense)	(115,474)	(129,662)	(288,786)	(252,277)
Income before provision for income taxes	658,996	(67,170)	992,853	(143,477)
Provision for state income taxes	116,693	(16,154)		(2,091)
Net Income (loss) of discontinued operations	$ 775,689	$ (83,324)	$ 992,853	$ (145,568)

DISCONTINUED OPERATIONS (Deta19

DISCONTINUED OPERATIONS (Details 1) - USD ($)	Jun. 30, 2017	Apr. 28, 2017	Dec. 31, 2016
Current assets of discontinued operations
Inventories	$ 1,897,414		$ 1,797,061
Total current assets	5,836,278		11,151,630
Plant, Property and Equipment - Net	54,152		142,167
Other long term assets	3,382		6,798
Total assets	5,893,812		11,345,543
Current liabilities of discontinued operations:
Accrued expenses	42,389
Total current liabilities	$ 1,379,048		8,664,877
Discontinued Operations [Member]
Current assets of discontinued operations
Accounts receivable		$ 1,298,399	1,264,649
Inventories		6,957,866	7,184,868
Prepaid expenses		25,362	19,955
Total current assets		8,281,627	8,469,472
Plant, Property and Equipment - Net		100,774	44,448
Other long term assets		3,525	500
Total assets		104,299	44,948
Current liabilities of discontinued operations:
Accounts payable		1,285,200	1,560,776
Accrued expenses		9,910	85,672
Total current liabilities		$ 1,295,110	$ 1,646,448

DISCONTINUED OPERATIONS (Deta20

DISCONTINUED OPERATIONS (Details Narrative) - USD ($)	1 Months Ended	3 Months Ended	6 Months Ended
	Apr. 28, 2017	Jun. 30, 2017	Jun. 30, 2017
Sale of Assets	$ 4,557,611		$ 4,557,611
Discontinued Operations [Member]
Sale of Assets		$ 7,091,000
Gain on Sale		3,409,000
Total Sale		$ 10,500,000

LONG-TERM DEBT AND LINE OF CR21

LONG-TERM DEBT AND LINE OF CREDIT (Details) - USD ($)	3 Months Ended		6 Months Ended
	Jun. 30, 2017	Jun. 30, 2016	Jun. 30, 2017	Jun. 30, 2016
Mark to market adjustment			$ 213,000	$ (154,150)
Level 3 [Member]
Balance as of December 31, 2016			687,000
Mark to market adjustment			213,000
Balance as of June 30, 2017	900,000		900,000
Repurchase of Stock			(900,000)
Balance as of June 30, 2017	$ 0		$ 0

LONG-TERM DEBT AND LINE OF CR22

LONG-TERM DEBT AND LINE OF CREDIT (Details Narrative) - USD ($)	1 Months Ended			6 Months Ended	12 Months Ended
	Jul. 31, 2017	Apr. 28, 2017	Jan. 16, 2015	Jun. 30, 2017	Dec. 31, 2016	Aug. 25, 2015
Interest rate				3.98%
Repurchase of common stock		96,697		96,697
Line of credit				$ 497,438	$ 5,292,366
Prime lending rate				1.25%
LIBOR rate plus				2.75%
Revolving loan principal balance				$ 526,021	5,339,199
Revolving loan principal balance, net of origination and transaction costs				497,438	$ 5,292,366
Proceeds of Asset		$ 4,557,611		4,557,611
Debt discount				165,650
Estimated value				900,000
Total price				$ 900,000
WBCC Credit Agreement [Member]
Line of credit						$ 7,500,000
Effective interest rate				40.30%
Repayment of line of credit	$ 209,406
On April 28, 2017 [Member] | C3 [Member]
Repurchase of common stock				96,697
Purchase price				$ 900,000
Refinancing [Member]
Subsidiaries amount			$ 5,500,000
Subordinated subsidiaries amount			$ 3,500,000
Unregistered Common Stock for loan			3,200
Refinancing [Member] | Note A [Member]
Maturity date				Jan. 16, 2020
Interest rate				11.00%
Interest rate monthly				10.00%
Accrued interest rate				1.00%
Refinancing [Member] | Note B [Member]
Maturity date				Jan. 16, 2020
Interest rate				14.00%

COMMITMENTS AND CONTINGENCIES (

COMMITMENTS AND CONTINGENCIES (Details Narrative) - USD ($)	1 Months Ended	3 Months Ended		6 Months Ended
	Jan. 16, 2015	Jun. 30, 2017	Jun. 30, 2016	Jun. 30, 2017	Jun. 30, 2016
Monthly payment for lease				$ 3,533
Lease expiration date				Feb. 28, 2019
Consulting fees per annum	$ 100,000
Maturity date for agreement	Jan. 16, 2017
Bonus		$ 60,000		$ 60,000
EBITDA		$ 2,890,124	$ 195,031		$ 637,210
Mr. Mondo [Member]
Base salary				$ 195,000
Percentage of cash bonus				4.00%
EBITDA				$ 1,000,000
Sahre based compensation description				In addition, Mr. Mondo was entitled to an award ofshares of the common stock of the Company equal to 3% of the total equity on a fully diluted basis, which were to fully vest on December 31, 2018. Pursuant to the updated Employment Agreement, Mr. Mondo’s shares vested fully on June 30, 2017, subject to various clawback provisions.
Vested Shares, Issued				8,966
Common Stock ,receive				3,800

RELATED PARTY TRANSACTIONS _Det

RELATED PARTY TRANSACTIONS [Details Narrative] - USD ($)	1 Months Ended	6 Months Ended
	Jan. 16, 2015	Jun. 30, 2017	Jun. 30, 2016	Oct. 18, 2016
Consulting fees per annum	$ 100,000
Purchase Price per share				$ 0.02
Stock issued for payment of debt		$ 85,600
Precision Group Holdings LLC [Member]
Consulting fees per annum	$ 100,000
Messrs Wachter [Member]
Shares issued in lieu of management fees		825
Purchase Price per share		$ 40
Mr. Seamus Lamb [Member]
Shares issued in lieu of management fees		490
Purchase Price per share		$ 40

SUBSEQUENT EVENTS (Details Narr

SUBSEQUENT EVENTS (Details Narrative) - USD ($)	1 Months Ended
	Jul. 17, 2017	Jul. 31, 2017	Jul. 12, 2017	Jun. 30, 2017	Jun. 26, 2017	Dec. 31, 2016
Aggregate purchase price				$ 900,000
Escrow deposit				$ 500,000	$ 500,000
Investors [Member]
Aggregate purchase price	$ 40
Restricted common stock, Sold	75,500
Total consideration	$ 3,020,000
Subsequent Event [Member] | Asset Purchase Agreement [Member] | Aero-Missile [Member]
Aggregate purchase price			$ 9,600,000
Escrow deposit			$ 500,000
Subsequent Event [Member] | Credit Agreement [Member] | Webster Business Credit Corporation [Member]
Remaining principal balance		$ 209,406