0001262463-16-001053.txt : 20160930 0001262463-16-001053.hdr.sgml : 20160930 20160930145424 ACCESSION NUMBER: 0001262463-16-001053 CONFORMED SUBMISSION TYPE: 10-Q PUBLIC DOCUMENT COUNT: 49 CONFORMED PERIOD OF REPORT: 20160630 FILED AS OF DATE: 20160930 DATE AS OF CHANGE: 20160930 FILER: COMPANY DATA: COMPANY CONFORMED NAME: PETRONE WORLDWIDE, INC. CENTRAL INDEX KEY: 0001096132 STANDARD INDUSTRIAL CLASSIFICATION: SERVICES-MANAGEMENT CONSULTING SERVICES [8742] IRS NUMBER: 870652348 STATE OF INCORPORATION: NV FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 10-Q SEC ACT: 1934 Act SEC FILE NUMBER: 000-30380 FILM NUMBER: 161912630 BUSINESS ADDRESS: STREET 1: 2200 N. COMMERCE PARKWAY CITY: WESTON STATE: FL ZIP: 33326 BUSINESS PHONE: 855-297-3876 MAIL ADDRESS: STREET 1: 2200 N. COMMERCE PARKWAY CITY: WESTON STATE: FL ZIP: 33326 FORMER COMPANY: FORMER CONFORMED NAME: DIABETEX INTERNATIONAL CORP DATE OF NAME CHANGE: 19991001 10-Q 1 pfwi63016q.htm FORM 10-Q

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, DC 20549

FORM 10-Q

þ Quarterly report pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

For the quarterly period ended June 30, 2016

o Transition report pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

COMMISSION FILE NO. 000-30380

PETRONE WORLDWIDE, INC.

(Exact name of registrant as specified in its charter)

Nevada		87-0652348
(State or other jurisdiction of		(I.R.S. Employer
incorporation or organization)		Identification No.)

2200 N. Commerce Parkway, Weston, FL		33326
(Address of principal executive offices)		(Zip Code)

(855) 297-3876

(Registrant’s telephone number, including area code)

Former name, former address and former fiscal year, if changed since last report: Not applicable.

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.

þYes o No

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate website, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files).

þYes o No

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See the definition of “large accelerated filer,” “accelerated filer” and “smaller reporting company” in Rule 12b-2 of the Exchange Act. (Check one):

Large accelerated filer

Accelerated filer

Non-accelerated filer

(Do not check if a smaller reporting company)

Smaller reporting company

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).

oYes þ No

As of September 29, 2016, the registrant had 22,899,897 shares of common stock, par value $.001 per share, issued and outstanding.

EXPLANATORY NOTE

This Quarterly Report on Form 10-Q of Petrone Worldwide, Inc. for the period ended June 30, 2016 reflects restated financials statements and other information as reported on the Quarterly Report of Petrone Worldwide, Inc. for the period ended June 30, 2015 originally filed on August 14, 2015 (the “Original Report”). In the Original Filing, we did not properly reflect certain transactions for revenues, costs of revenues and operating expenses in the proper period.

Please see Note 8 - Restatement contained in the Notes to Unaudited Consolidated Financial Statements appearing later in this Form 10-Q which further describes the effect of these restatements

PETRONE WORLDWIDE, INC.

FORM 10-Q

INDEX

		Page
Part I. Financial Information

	Item 1. Financial Statements	4

	Consolidated Balance Sheets—June 30, 2016 and December 31, 2015(unaudited)	4

	Consolidated Statements of Operations–Three and Six Months Ended June 30, 2016 and 2015 (unaudited)	5

	Consolidated Statements of Cash Flows – Six Months Ended June 30, 2016 and 2015 (unaudited)	6

	Notes to Unaudited Consolidated Financial Statements

	Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations	16

	Item 3. Quantitative and Qualitative Disclosures about Market Risk	22

	Item 4. Controls and Procedures	22

Part II. Other Information

	Item 1. Legal Proceedings	22

	Item 1A. Risk Factors	22

	Item 2. Unregistered Sales of Equity Securities and Use of Proceeds	22

	Item 3. Defaults Upon Senior Securities	23

	Item 4. Mine Safety Disclosures	23

	Item 5. Other Information	23

	Item 6. Exhibits	23

Signatures		23

PART I. FINANCIAL INFORMATION

Item 1. Financial Statements

PETRONE WORLDWIDE, INC. AND SUBSIDIARY
CONSOLIDATED BALANCE SHEETS
(Unaudited)

	June 30,			December 31,
	2016			2015

ASSETS
CURRENT ASSETS:
Cash	$	46,788		$	208,064
Accounts receivable		16,977			—
Prepaid expenses and other current assets		29,897			131,046
Advances to supplier		109,134			11,262

Total Current Assets		202,796			350,372

TOTAL ASSETS	$	202,796		$	350,372

LIABILITIES AND STOCKHOLDERS' EQUITY

CURRENT LIABILITIES:
Convertible notes payable, net	$	90,514		$	129,187
Accounts payable		9,729			45,174
Accrued expenses		2,902			405
Due to related party		2,555			38,434
Derivative liability		4,950			73,236

Total Current Liabilities		110,650			286,436

Total Liabilities		110,650			286,436

Commitments (See Note 6)

STOCKHOLDERS' EQUITY:
Preferred stock, $.001 par value, 10,000,000 shares authorized;
Series A preferred stock: $.001 par value; 1,000,000 shares authorized; 1,000,000 and 0 shares issued and outstanding at June 30, 2016 and December 31, 2015, respectively		1,000			—
Common stock: $.001 par value, 100,000,000 shares authorized; 22,769,897 and 21,483,230 issued and outstanding at June 30, 2016 and December 31, 2015, respectively		22,770			21,483
Additional paid-in capital		3,257,058			2,722,559
Accumulated deficit		(3,188,682	)		(2,680,106	)

Total Stockholders' Equity		92,146			63,936

Total Liabilities and Stockholders' Equity	$	202,796		$	350,372

See accompanying notes to unaudited consolidated financial statements.

PETRONE WORLDWIDE, INC. AND SUBSIDIARY
CONSOLIDATED STATEMENTS OF OPERATIONS
(Unaudited)

		For the Three Months Ended						For the Six Months Ended
		June 30,						June 30,
		2016			2015			2016			2015
					(As Restated)						(As Restated)
REVENUES	$	63,808		$	574,596		$	171,429		$	1,349,090

COST OF REVENUES		58,626			488,375			133,896			1,242,904

GROSS PROFIT		5,182			86,221			37,533			106,186

OPERATING EXPENSES:
Compensation and related benefits		32,000			2,600			33,000			12,600
Consulting fees		64,574			28,526			144,340			36,248
Professional fees		33,388			21,524			98,804			29,709
Rent expense		13,059			13,504			35,216			48,623
General and administrative expenses		50,946			29,941			144,616			68,184

Total Operating Expenses		193,967			96,095			455,976			195,364

LOSS FROM OPERATIONS		(188,785	)		(9,874	)		(418,443	)		(89,178	)

OTHER EXPENSES:
Interest expenses		(87,525	)		(47	)		(145,633	)		(47	)
Gain on derivative liability		14,693			—			55,500			—

Total Other Expense		(72,832	)		(47	)		(90,133	)		(47	)

NET LOSS	$	(261,617	)	$	(9,921	)	$	(508,576	)	$	(89,225	)

NET LOSS PER COMMON SHARE:
Basic and diluted	$	(0.01	)	$	(0.00	)	$	(0.02	)	$	(0.01	)

WEIGHTED AVERAGE COMMON SHARES OUTSTANDING:
Basic and diluted		22,733,853			15,643,535			22,485,739			15,459,938

See accompanying notes to unaudited consolidated financial statements.

PETRONE WORLDWIDE, INC. AND SUBSIDIARY
CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited)

		For the Six Months Ended
		June 30,
		2016			2015
					(As Restated)
CASH FLOWS FROM OPERATING ACTIVITIES
Net loss	$	(508,576	)	$	(89,225	)
Adjustments to reconcile net loss to net cash used in operating activities:
Amortization of debt discount to interest expense		92,971			—
Stock-based compensation		117,149			36,248
Gain on derivative liability		(55,500	)		—
Stock-based interest expense for debt modification		28,000			—
Change in operating assets and liabilities:
Accounts receivable		(16,977	)		(594	)
Prepaid expenses and other current assets		—			8,262
Advances to supplier		(97,872	)		(9,764	)
Accounts payable		(35,445	)		(1,105	)
Accrued expenses		2,497			(9,813	)
Advances from customers		—			6,568

NET CASH USED IN OPERATING ACTIVITIES		(473,753	)		(59,423	)

CASH FLOWS FROM FINANCING ACTIVITIES
Repayment of related party advances		(35,879	)		(983	)
Repayment of convertible debt		(131,644	)		—
Proceeds from sale of common stock		480,000			5,000

NET CASH PROVIDED BY FINANCING ACTIVITIES		312,477			4,017

NET DECREASE IN CASH		(161,276	)		(55,406	)

CASH, beginning of period		208,064			77,827

CASH, end of period	$	46,788		$	22,421

SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION
Cash paid for:
Interest	$	50,122		$	—
Income taxes	$	—		$	—

SUPPLEMENTAL DISCLOSURE OF NON-CASH INVESTING AND FINANCING ACTIVITIES:
Reclassification of derivative liability to equity	$	12,786		$	—
Unearned common stock issued for services	$	—		$	108,000
Exchange of related party advances for accounts payable	$	—		$	800

See accompanying notes to unaudited consolidated financial statements.

PETRONE WORLDWIDE, INC. AND SUBSIDIARY

NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS
JUNE 30, 2016

NOTE 1 – ORGANIZATION AND BASIS OF PRESENTATION

Organization

Petrone Worldwide, Inc. (the “Company”) was incorporated as Sheridan Industries, Inc. on December 14, 1998 in the State of Nevada. On December 31, 1998, the Company changed its name to Diabetex International Corp. and effective February 18, 2014, the Company changed its name to Petrone Worldwide, Inc.

On January 29, 2014 and effective March 3, 2014, the Company entered into a purchase agreement (the “Purchase Agreement”) with Petrone Food Works, Inc. (“PFW”) and the shareholder of PFW. Pursuant to the Purchase Agreement, the Company acquired 100% of PFW’s issued and outstanding common stock from the PFW shareholder in exchange for the issuance of 11,760,542 shares of the Company’s common stock, representing 98.4% of the outstanding common stock, (the “Exchange”), after giving effect to a 1-for-500 reverse stock split (the “Reverse Stock Split”) which resulted in 195,607 common shares outstanding prior to the Exchange for liabilities of $30,000. Accordingly, the PFW shareholder became a shareholder of the Company and PFW became a subsidiary of the Company. The Exchange has been accounted for as a reverse-merger and recapitalization since the stockholder of PFW obtained voting and management control of the Company. PFW is the acquirer for financial reporting purposes and the Company is the acquired company. Consequently, the assets and liabilities and the operations reflected in the historical financial statements prior to the Exchange are those of PFW and was recorded at the historical cost basis of PFW, and the consolidated financial statements after completion of the Exchange included the assets and liabilities of both the Company and PFW and the Company’s consolidated operations from the closing date of the Exchange. All share and per share data in the accompanying consolidated financial statements have been retroactively restated to reflect the effect of the Reverse Stock Split and recapitalization. PFW was formed under the laws of the State of Nevada in October 2013.

The Company is in the hospitality industry and is a supplier of tabletop kitchenware and hotel room products thru an exclusive licensing agreement with a leading supplier.

Basis of Presentation and Principles of Consolidation

The Company’s unaudited consolidated financial statements include the financial statements of its wholly-owned subsidiary, Petrone Food Works, Inc. (inactive). All significant intercompany accounts and transactions have been eliminated in consolidation.

The consolidated financial statements for the three and six months ended June 30, 2016 and 2015 have been prepared by us without audit pursuant to the rules and regulations of the Securities and Exchange Commission. In the opinion of management, all adjustments necessary to present fairly our financial position, results of operations, and cash flows as of June 30, 2016 and 2015, and for the periods then ended, have been made. Those adjustments consist of normal and recurring adjustments. Certain information and note disclosures normally included in our annual financial statements prepared in accordance with generally accepted accounting principles have been or omitted. The unaudited consolidated financial statements should be read in conjunction with the audited consolidated financial statements as of and for the year ended December 31, 2015 and footnotes thereto included in the Company’s Annual Report on Form 10-K filed with the SEC on September 9, 2016. The results of operations for the six months ended June 30, 2016 are not necessarily indicative of the results to be expected for the full year.

Going concern

These unaudited consolidated financial statements have been prepared on a going concern basis, which contemplates the realization of assets and the settlement of liabilities and commitments in the normal course of business. As reflected in the accompanying unaudited consolidated financial statements, for the six months ended June 30, 2016, the Company had a net loss of $508,576 and net cash used in operations of $473,753. Additionally, the Company had an accumulated deficit, stockholders’ equity and working capital of $3,188,682, $92,146 and $92,146, respectively, at June 30, 2016. These factors raise substantial doubt about the Company’s ability to continue as a going concern. Management cannot provide assurance that the Company will ultimately achieve profitable operations or become cash flow positive, or raise additional debt and/or equity capital. The Company is seeking to raise capital through additional debt and/or equity financings to fund its operations in the future. Although the Company has historically raised capital from sales of equity and from the issuance of promissory notes, there is no assurance that it will be able to continue to do so. If the Company is unable to raise additional capital or secure additional lending in the near future, management expects that the Company will need to curtail its operations. These consolidated financial statements do not include any adjustments related to the recoverability and classification of assets or the amounts and classification of liabilities that might be necessary should the Company be unable to continue as a going concern.

PETRONE WORLDWIDE, INC. AND SUBSIDIARY

NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS
JUNE 30, 2016

NOTE 2 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Use of estimates

The preparation of consolidated financial statements in conformity with accounting principles generally accepted in the United States 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 consolidated financial statements and the reported amounts of revenue and expenses during the reporting period. Actual results could differ from those estimates. Significant estimates for the six months ended June 30, 2016 and 2015 include estimates of current and deferred income taxes and deferred tax valuation allowances, the fair value of derivative liabilities, and the fair value of non-cash equity transactions.

Fair value of financial instruments and fair value measurements

The Company adopted the guidance of Accounting Standards Codification (“ASC”) 820 for fair value measurements which clarifies the definition of fair value, prescribes methods for measuring fair value, and establishes a fair value hierarchy to classify the inputs used in measuring fair value as follows:

Level 1- Inputs are unadjusted quoted prices in active markets for identical assets or liabilities available at the measurement date.

Level 2- Inputs are quoted prices for similar assets and liabilities in active markets, quoted prices for identical or similar assets and liabilities in markets that are not active, inputs other than quoted prices that are observable, and inputs derived from or corroborated by observable market data.

Level 3- Inputs are unobservable inputs that reflect the reporting entity’s own assumptions on what assumptions the market participants would use in pricing the asset or liability based on the best available information.

The carrying amounts reported in the consolidated balance sheets for cash and cash equivalents, accounts receivable, loans, accounts payable, accrued expenses, and other payables approximate their fair market value based on the short-term maturity of these instruments.

The Company analyzes all financial and non-financial instruments with features of both liabilities and equity under the FASB’s accounting standard for such instruments. Under this standard, financial and non-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 accounts for one instrument at fair value using level 3 valuation.

	At June 30, 2016					At December 31, 2015
Description		Level 1	Level 2		Level 3		Level 1	Level 2		Level 3
Derivative liability		—	—	$	4,950		—	—	$	73,236

A roll forward of the level 3 valuation financial instruments is as follows:

		Derivative Liability
Balance at December 31, 2015	$	73,236
Reclassification of derivative liability to equity		(12,786	)
Change in fair value included in net loss		(55,500	)
Balance at June 30, 2016	$	4,950

ASC 825-10 “Financial Instruments”, allows entities to voluntarily choose to measure certain financial assets and liabilities at fair value (fair value option). The fair value option may be elected on an instrument-by-instrument basis and is irrevocable, unless a new election date occurs. If the fair value option is elected for an instrument, unrealized gains and losses for that instrument should be reported in earnings at each subsequent reporting date. The Company did not elect to apply the fair value option to any outstanding instruments.

PETRONE WORLDWIDE, INC. AND SUBSIDIARY

NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS
JUNE 30, 2016

NOTE 2 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)

Cash and cash equivalents

For purposes of the consolidated statements of cash flows, the Company considers all highly liquid instruments with a maturity of three months or less at the purchase date and money market accounts to be cash equivalents.

Accounts receivable

The Company recognizes an allowance for losses on accounts receivable in an amount equal to the estimated probable losses net of recoveries. The allowance is based on an analysis of historical bad debt experience, current receivables aging, and expected future write-offs, as well as an assessment of specific identifiable customer accounts considered at risk or uncollectible. The expense associated with the allowance for doubtful accounts is recognized as general and administrative expense.

Advances to Supplier

Advances to supplier represent the advance payments for the purchase of product from supplier.

Impairment of long-lived assets

In accordance with ASC Topic 360, the Company reviews long-lived assets for impairment whenever events or changes in circumstances indicate that the carrying amount of the assets may not be fully recoverable, or at least annually. The Company recognizes an impairment loss when the sum of expected undiscounted future cash flows is less than the carrying amount of the asset. The amount of impairment is measured as the difference between the asset’s estimated fair value and its book value.

Derivative liabilities

The Company has certain financial instruments that are embedded derivatives associated with capital raises. The Company evaluates all its financial instruments to determine if those contracts or any potential embedded components of those contracts qualify as derivatives to be separately accounted for in accordance with FASB ASC 810-10-05-4 and 815-40. This accounting treatment requires that the carrying amount of any embedded derivatives be recorded at fair value at issuance and marked-to-market at each balance sheet date. In the event that the fair value is recorded as a liability, as is the case with the Company, the change in the fair value during the period is recorded as either income or expense. Upon conversion or exercise, the derivative liability is marked to fair value at the conversion date and then the related fair value is reclassified to equity.

Revenue recognition

Pursuant to the guidance of ASC Topic 605, the Company recognizes sales when persuasive evidence of an arrangement exists, delivery has occurred or services have been provided, the purchase price is fixed or determinable and collectability is reasonably assured. The Company’s standard terms are “ex works”, with title transferring to its customer at the Company suppliers’ loading docks or upon embarkation with risk of loss being assumed by the customer at the shipping point. The Company has a small percentage of sales with other terms, and revenue is recognized in accordance with the terms of the related customer purchase order. Shipping and handling costs billed to customers are recognized in revenue.

Cost of sales

Cost of sales includes inventory costs, materials and supplies costs, and shipping and handling costs incurred.

Shipping and handling costs

For the six months ended June 30, 2016 and 2015, shipping and handling costs incurred for product shipped to customers are included in cost of sales and amounted to $27,750 and $126,018, respectively. Shipping and handling costs charged to customers are included in sales.

PETRONE WORLDWIDE, INC. AND SUBSIDIARY

NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS
JUNE 30, 2016

NOTE 2 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)

Advertising costs

All costs related to advertising of the Company’s products are expensed in the period incurred.

Income taxes

The Company accounts for income tax using the liability method prescribed by ASC 740, “Income Taxes”. Under this method, deferred tax assets and liabilities are determined based on the difference between the financial reporting and tax bases of assets and liabilities using enacted tax rates that will be in effect in the year in which the differences are expected to reverse. The Company records a valuation allowance to offset deferred tax assets if based on the weight of available evidence, it is more-likely-than-not that some portion, or all, of the deferred tax assets will not be realized. The effect on deferred taxes of a change in tax rates is recognized as income or loss in the period that includes the enactment date.

The Company follows the accounting guidance for uncertainty in income taxes using the provisions of Accounting Standards Codification (ASC) 740 “Income Taxes”. Using that guidance, tax positions initially need to be recognized in the financial statements when it is more likely than not the position will be sustained upon examination by the tax authorities. As of June 30, 2016 and December 31, 2015, the Company had no uncertain tax positions that qualify for either recognition or disclosure in the financial statements. The Company recognizes interest and penalties related to uncertain income tax positions in other expense. The Company did not record such interest or penalties for the six months ended June 30, 2016 and 2015.

Stock-based compensation

Stock-based compensation is accounted for based on the requirements of the Share-Based Payment Topic of ASC 718 which requires recognition in the financial statements of the cost of employee and director services received in exchange for an award of equity instruments over the period the employee or director is required to perform the services in exchange for the award (presumptively, the vesting period). The ASC also requires measurement of the cost of employee and director services received in exchange for an award based on the grant-date fair value of the award.

Pursuant to ASC Topic 505-50, for share-based payments to consultants and other third-parties, compensation expense is determined at the “measurement date.” The expense is recognized over the service period of the award. Common stock awards issued to consultants represent common stock granted to non-employees in exchange for services at fair value. The measurement dates for such awards are set at the dates that the contracts are entered into as the awards are non-forfeitable and vest immediately. The measurement date fair value is then recognized over the service period as if the Company has paid cash for such service.

Loss per share of common stock

ASC 260 “Earnings Per Share”, requires dual presentation of basic and diluted earnings per share (“EPS”) with a reconciliation of the numerator and denominator of the basic EPS computation to the numerator and denominator of the diluted EPS computation. Basic EPS excludes dilution. Diluted EPS reflects the potential dilution that could occur if securities or other contracts to issue common stock were exercised or converted into common stock or resulted in the issuance of common stock that then shared in the earnings of the entity. Basic net loss per common share is computed by dividing net loss available to common shareholders by the weighted average number of shares of common shares outstanding during the period. Diluted net loss per common share is computed by dividing net loss by the weighted average number of shares of common stock, common stock equivalents and potentially dilutive securities outstanding during each period. Additionally, potentially dilutive common shares consist of common stock issuable upon conversion of convertible debt. These common stock equivalents may be dilutive in the future. Potentially dilutive common shares were excluded from the computation of diluted shares outstanding as they would have an anti-dilutive impact on the Company’s net losses and consisted of the following:

	June 30, 2016		June 30, 2015
Convertible notes		449,523		30,612

PETRONE WORLDWIDE, INC. AND SUBSIDIARY

NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS
JUNE 30, 2016

NOTE 2 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)

Recent accounting pronouncements

In May 2014, the FASB issued an update ("ASU 2014-09") Revenue from Contracts with Customers. ASU 2014-09 establishes a single comprehensive model for entities to use in accounting for revenue arising from contracts with customers and supersedes most of the existing revenue recognition guidance. ASU 2014-09 requires an entity to recognize revenue when it transfers promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services and requires certain additional disclosures. ASU 2014-09 is effective for interim and annual reporting periods in fiscal years that begin after December 15, 2016. The Company is currently evaluating the impact of the adoption of ASU 2014-09 on its consolidated financial statements.

In June 2014, the FASB issued an update (“ASU 2014-12”) to ASC Topic 718, Compensation – Stock Compensation. ASU 2014-12 requires an entity to treat performance targets that can be met after the requisite service period of a share-based award has ended, as a performance condition that affects vesting. ASU 2014-12 is effective for interim and annual reporting periods in fiscal years that begin after December 15, 2015. The adoption of ASU 2014-12 did not have a material effect on the Company’s financial position, results of operations and cash flows.

In August 2014, the FASB issued ASU 2014-15, Disclosure of Uncertainties About an Entity’s Ability to Continue as a Going Concern, that will require management to assess an entity’s ability to continue as a going concern, and to provide related footnote disclosures in certain circumstances. In connection with each annual and interim period, management will assess if there is substantial doubt about an entity’s ability to continue as a going concern within one year after the issuance date. Substantial doubt exists if it is probable that the entity will be unable to meet its obligations within one year after the issuance date. The new standard defines substantial doubt and provides example indicators. Disclosures will be required if conditions give rise to substantial doubt. However, management will need to assess if its plans will alleviate substantial doubt to determine the specific disclosures. This standard is effective for public entities for annual periods ending after December 15, 2016. Earlier application of this standard is permitted. This standard is not expected to have a material effect on our financial position, results of operations and cash flows.

In February 2015, the FASB issued ASU 2015-02, Consolidation (Topic 810) (“ASU 2015-02”), to address financial reporting considerations for the evaluation as to the requirement to consolidate certain legal entities. ASU 2015-02 is effective for fiscal years and for interim periods within those fiscal years beginning after December 15, 2015. This standard did not have a material effect on the Company’s financial position, results of operations and cash flows.

In April 2015, the FASB issued ASU 2015-03, Interest—Imputation of Interest (Subtopic 835-30) (“ASU 2015-03”), as part of the initiative to reduce complexity in accounting standards. The update requires that debt issuance costs related to a recognized debt liability be presented in the balance sheet as a direct deduction from the carrying amount of that debt liability, consistent with debt discounts. ASU 2015-03 is effective for annual periods beginning after December 15, 2015 and for interim periods within those fiscal years.

In November 2015, the FASB issued ASU 2015-17, Balance Sheet Classification of Deferred Taxes (“ASU 2015-17”), which requires entities to present deferred tax assets and deferred tax liabilities as noncurrent in a classified balance sheet. The ASU simplifies the current guidance in ASC Topic 740, Income Taxes, which requires entities to separately present deferred tax assets and liabilities as current and noncurrent in a classified balance sheet. ASU 2015-17 is effective for fiscal years beginning after December 15, 2016, and interim periods within those annual periods. Early adoption is permitted for all entities as of the beginning of an interim or annual reporting period. The Company does not expect the impact of ASU 2015-17 to be material to our consolidated financial statements.

There are no other recently issued accounting standards that apply to us or that are expected to have a material impact on our results of operations, financial condition, or cash flows.

PETRONE WORLDWIDE, INC. AND SUBSIDIARY

NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS
JUNE 30, 2016

NOTE 3 – CONVERTIBLE NOTES

In 2013 and on July 1, 2014, the Company entered into two convertible promissory note agreements with individuals in the amount of $20,000 and $10,000, respectively. The notes were non-interest bearing, unsecured and were due on demand. The notes are convertible into shares of stock of the Company at the market price on the date of conversion. Pursuant to ASC Topic 470-20 (Debt with conversion and other options), since these convertible notes had fixed conversion price at market, the Company determined it had a fixed monetary amounts that can be settled for the debt. Accordingly, no derivative liability was calculated. On December 22, 2015, the Company entered into a debt purchase and assignment agreement with one of the debt holders whereby a convertible note in the principal amount of $10,000 became convertible at $.0025 per common share and the note was converted into 4,000,000 shares of the Company’s common stock. At June 30, 2016, one note remains due in the principal amount of $20,000.

On December 28, 2015, the Company entered into a secured convertible promissory note (the “Convertible Note”) with Firstfire Global Opportunities Fund LLC (the “Lender”), with a principal amount of $230,000, which amount is the $200,000 purchase price plus a 15% original issue discount equal to $30,000. Additionally, the lender deducted legal fees of $10,000 and the Company received net proceeds of $190,000. The unpaid principal and interest is secured by the Company’s common stock, bears interest computed at a rate of interest that is equal to 7.0% per annum, and is payable in monthly installments of $50,555 commencing April 28, 2016 through August 28, 2016. Any amount of principal or interest on this Convertible Note, which is not paid by the due dates, shall bear interest at the rate of 15% per annum from the due date until paid. During the six months ended June 30, 2016, the Company repaid Convertible Note principal of $131,644.

The Lender is entitled, at their option, at any time after the eighth month anniversary of this Convertible Note, to convert all or any lesser portion of the outstanding principal amount and accrued but unpaid interest into the Company’s common stock. The conversion price shall equal $0.50 per share (the "Fixed Conversion Price") provided, however that from and after the occurrence of any event of default, as defined, the conversion price shall be the lower of: (i) the Fixed Conversion Price or (ii) 50% multiplied by the lowest sales price of the common stock in a public market during the ten consecutive Trading Day period immediately preceding the Trading Day that the Company receives a notice of conversion. In connection with the issuance of this Convertible Note, the Company determined that the terms of the Convertible Note include a down-round provision under which the conversion price and exercise price could be affected by future equity offerings undertaken by the Company or contain terms that are not fixed monetary amounts at inception. Accordingly, under the provisions of FASB ASC Topic No. 815-40, “Derivatives and Hedging – Contracts in an Entity’s Own Stock”, the embedded conversion option contained in the convertible instruments were accounted for as derivative liabilities at the date of issuance and shall be adjusted to fair value through earnings at each reporting date. The fair value of the embedded conversion option derivatives was determined using the Black- Scholes Option Pricing Model. On the initial measurement date, the fair values of the embedded conversion option derivative of $73,236 was recorded as a derivative liability and was allocated as a debt discount to the Convertible Note of $73,236. At December 28, 2015, the Company valued the embedded conversion option derivative liabilities resulting in no gain or loss from change in fair value of derivative liabilities. Additionally, in connection with this Convertible Note, in December 2015, the Company paid Lender debt issuance costs of $10,000 and issued 50,000 shares of its common stock. These common shares were valued at $0.225 per share based on recent sales of the Company’s stock and in December 2015, the Company recorded a debt discount of $10,725, which is the relative fair value of such shares.

At June 30, 2016, and December 31, 2015, the fair value of the derivative liabilities was estimated using the Black-scholes option-pricing model with the following assumptions:

	June 30, 2016			December 31, 2015
Dividend rate		0			0
Term (in years)		0.41 to 0.125 years			0.67 years
Volatility		100.0	%		100.0	%
Risk-free interest rate		0.26% to 0.39%			0.66	%

For the six months ended June 30, 2016 and 2015, amortization of debt discounts related to this convertible note amounted to $92,971 and $0, which has been included in interest expenses on the accompanying unaudited consolidated statements of operations, respectively.

PETRONE WORLDWIDE, INC. AND SUBSIDIARY

NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS
JUNE 30, 2016

NOTE 3 – CONVERTIBLE NOTES (continued)

At June 30, 2016 and December 31, 2015, convertible promissory notes consisted of the following:

	June 30, 2016			December 31, 2015
Principal amount	$	118,356		$	250,000
Less: unamortized debt discount		(27,842	)		(120,813	)
Convertible notes payable, net	$	90,514		$	129,187

NOTE 4 – RELATED PARTY TRANSACTIONS

From time to time, the Company receives advances from the Company’s chief executive officer for working capital purposes. The advances are non-interest bearing and are payable on demand. For the six months ended June 30, 2016 and 2015, due to related party activity consisted of the following:

	Six Months ended June 30, 2016			Six Months ended June 30, 2015
Balance due to related party at beginning of period	$	38,434		$	8,051
Working capital advances received		—			800
Repayments made and conversions		(35,879	)		(983	)
Balance due to related party at end of period	$	2,555		$	7,868

NOTE 5 - STOCKHOLDERS’ EQUITY

Preferred stock

The preferred stock may be issued in one or more series. The Company’s board of directors are authorized to issue the shares of preferred stock in such series and to fix from time to time before issuance thereof the number of shares to be included in any such series and the designation, powers, preferences and relative, participating, optional or other rights, and the qualifications, limitations or restrictions thereof, of such series.

On February 19, 2016, the Board of Directors of the Company authorized and approved to create a new class of voting preferred stock called “Series A Preferred Stock”, consisting of 1,000,000 shares authorized, $.001 par value. The preferred stock is not convertible into any other class or series of stock and has no liquidation preference value. The Series A Preferred Stock was issued to ensure perpetual control of at least 51% is provided to the holder of the Series A Preferred Stock. On all matters to come before the shareholders of the Company, the holders of Series A Preferred shall have that number of votes per share (rounded to the nearest whole share) equal to the product of (x) the number of shares of Series A Preferred held on the record date for the determination of the holders of the shares entitled to vote (the “Record Date”), or, if no record date is established, at the date such vote is taken or any written consent of shareholders is first solicited, and (y) 50. In the event that the votes by the holders of the Series A Preferred Stock do not total at least 51% of the votes of all classes of the Company’s authorized capital stock entitled to vote, then regardless of the provisions of this paragraph, in any such case, the votes cast by a majority of the holders of the Series A Preferred Stock shall be deemed to equal 51% of all votes cast at any meeting of stockholders, or any issue put to the stockholders for voting and the Company may state that any such action approved by at least a majority of the holders of the Series A Preferred Stock was had by majority vote of the holders of all classes of the Company’s capital stock.

On February 19, 2016, the Company issued 1,000,000 shares of Series A Preferred Stock to its chief executive officer. In connection with the issuance of Series A preferred shares, the Company recorded a nominal amount of stock-based compensation of $1,000 since the shares had no economic value, on the date of the issuance of such shares, the Company’s chief executive officer was the majority owner of the Company’s common shares, and the value of such voting rights were not readily and objectively measurable .

PETRONE WORLDWIDE, INC. AND SUBSIDIARY

NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS
JUNE 30, 2016

NOTE 5 - STOCKHOLDERS’ EQUITY (continued)

Common stock issued for services

On March 16, 2016, pursuant to a consulting agreement, the Company issued 16,667 shares of common stock to a consultant for investor relations services rendered. These shares were valued on the date of grant at $0.90 per share or $15,000 based on the fair value of services performed. In March 2016, in connection with the issuance of these shares, the Company recorded stock-based consulting expense of $15,000.

Additionally, for the six months ended June 30, 2016 and 2015, amortization of prepaid stock-based consulting fees amounted to $117,149 and $36,248, respectively.

Common shares issued in connection with debt addendum

On April 20, 2016 and June 6, 2016, the Company entered into agreements for the addendum of the Convertible Note (see Note 3) which waived all rights to enforce any event of default, which may have been triggered by the Company’s failure to file it reports with the SEC. In connection with these agreements, the Company issued 30,000 and 40,000 shares of common stock, respectively, for an aggregate of 70,000 shares of common stock. These shares were valued on the date of grant at $0.40 per share or $28,000 based on recent sales of the Company’s common stock.

Common stock issued for cash

On February 3, 2016, the Company sold 1,200,000 shares of its common stock at $0.40 per common share for cash of $200,000 and a subscription receivable of $280,000. The subscription receivable of $280,000 was collected in April 2016.

NOTE 6 – COMMITMENTS

International distribution agreement

On February 28, 2014, the Company entered into an International Distribution Agreement (the “International Distribution Agreement”) with its major supplier. Through June 30, 2016, the Company has complied with its minimum purchase commitments. Future minimum purchase amounts under the International Distribution Agreement at December 31, 2015 are as follows:

Years ending December 31,		Amount
	2016	$	1,000,000
	2017		1,500,000
	2018		2,500,000
	Total minimum purchase amounts	$	5,000,000

NOTE 7 – CONCENTRATIONS

Concentrations of credit risk

Financial instruments that potentially subject the Company to concentrations of credit risk consist primarily of and cash deposits. The Company places its cash in banks at levels that, at times, may exceed federally insured limits. There were no balances in excess of FDIC insured levels as of June 30, 2016 and December 31, 2015. The Company has not experienced any losses in such accounts through June 30, 2016.

Geographic concentrations of sales

For the six months ended June 30, 2016 and 2015, substantially all of the Company’s revenues was to customers located outside the United States. No other geographical area accounted for more than 10% of total sales during the six months ended June 30, 2016 and 2015.

PETRONE WORLDWIDE, INC. AND SUBSIDIARY

NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS
JUNE 30, 2016

NOTE 7 – CONCENTRATIONS (continued)

Customer concentrations

For the six months ended June 30, 2016, three customers accounted for approximately 46.2% of total sales (10.2%, 10.5% and 25.5%, respectively). For the six months ended June 30, 2015, five customers accounted for approximately 88.9% of total sales (22.9%, 14.3%, 23.0%, 13.8% and 14.9%, respectively). A reduction in sales from or loss of such customers would have a material adverse effect on the Company’s consolidated results of operations and financial condition.

Vendor concentrations

For the six months ended June 30, 2016 and 2015, the Company purchased all of its products from one supplier. The loss of this supplier may have a material adverse effect on the Company’s consolidated results of operations and financial condition.

NOTE 8 – RESTATEMENT OF 2015 PERIODS

The Company’s unaudited consolidated financial statements have been restated for the three and six months ended June 30, 2015 to properly reflect certain transactions for revenues, costs of revenues and operating expenses in the proper period. The effect of correcting these errors in the Company’s unaudited consolidated financial statements for the three and six months ended June 30, 2015 are shown in the table as follows:

Consolidated Statement of operations	For the Six Months Ended June 30, 2015 (Unaudited)
	As previously reported			Adjustments to Restate			As Restated
Revenues	$	1,341,890		$	7,200		$	1,349,090
Cost of revenues		1,185,340			57,564			1,242,904
Gross profit		156,550			(50,364	)		106,186
Operating expenses		217,711			(22,347	)		195,364
Loss from operations		(61,161	)		(28,017	)		(89,178	)
Other expenses		—			(47	)		(47	)
Net loss	$	(61,161	)	$	(28,064	)	$	(89,225	)
Net loss per common share	$	(0.00	)	$	(0.00	)	$	(0.01	)

Consolidated Statement of operations	For the Three Months Ended June 30, 2015 (Unaudited)
	As previously reported			Adjustments to Restate			As Restated
Revenues	$	557,348		$	17,248		$	574,596
Cost of revenues		469,489			18,886			488,375
Gross profit		87,859			(1,638	)		86,221
Operating expenses		105,600			(9,505	)		96,095
Loss from operations		(17,741	)		7,867			(9,874	)
Other expenses		—			(47	)		(47	)
Net loss	$	(17,741	)	$	7,820		$	(9,921	)
Net loss per common share	$	(0.00	)	$	(0.00	)	$	(0.00	)

NOTE 9 - SUBSEQUENT EVENTS

On August 26, 2016, the Company entered into an agreement for the addendum of the Convertible Note (see Note 3) which waived all rights to enforce any event of default, which may have been triggered by the Company’s failure to file it reports with the SEC. In connection with this agreement, the Company issued 130,000 shares of common stock and paid a cash penalty of $5,000. These shares were valued on the date of grant at $0.40 per share or $52,000 based on recent sales of the Company’s common stock.

Item 2: Management’s Discussion and Analysis of Financial Condition and Results of Operations

Cautionary Note Regarding Forward-Looking Information and Factors That May Affect Future Results

This quarterly report on Form 10-Q contains forward-looking statements regarding our business, financial condition, results of operations and prospects. The Securities and Exchange Commission (the “SEC”) encourages companies to disclose forward-looking information so that investors can better understand a company’s future prospects and make informed investment decisions. This quarterly report on Form 10-Q and other written and oral statements that we make from time to time contain such forward-looking statements that set out anticipated results based on management’s plans and assumptions regarding future events or performance. We have tried, wherever possible, to identify such statements by using words such as “anticipate,” “estimate,” “expect,” “project,” “intend,” “plan,” “believe,” “will” and similar expressions in connection with any discussion of future operating or financial performance. In particular, these include statements relating to future actions, future performance or results of current and anticipated sales efforts, expenses, the outcome of contingencies, such as legal proceedings, and financial results. Factors that could cause our actual results of operations and financial condition to differ materially are set forth in the “Risk Factors” section of our annual report on Form 10-K as filed with the SEC on September 9, 2016, as the same may be updated from time to time in documents that we file with the SEC.

We caution that these factors could cause our actual results of operations and financial condition to differ materially from those expressed in any forward-looking statements we make and that investors should not place undue reliance on any such forward-looking statements. Further, any forward-looking statement speaks only as of the date on which such statement is made, and we undertake no obligation to update any forward-looking statement to reflect events or circumstances after the date on which such statement is made or to reflect the occurrence of anticipated or unanticipated events or circumstances. New factors emerge from time to time, and it is not possible for us to predict all of such factors. Further, we cannot assess the impact of each such factor on our results of operations or the extent to which any factor, or combination of factors, may cause actual results to differ materially from those contained in any forward-looking statements.

The following discussion should be read in conjunction with our unaudited financial statements and the related notes that appear elsewhere in this quarterly report on Form 10-Q.

OVERVIEW

In 2015, we transitioned into an exclusive importer and distributor of commercial grade tableware products, decorative hotel room amenities, lavatory and bathroom fixtures and furniture, food and beverage service items, and trendy accessories for the Asian and the European marketplaces. Our exclusive brands include Front of the House and Room 360 by FOH.

Our founder, Victor Petrone, has spent over 20 years building a significant global network of buyers, comprised of hotels, resorts and restaurants, for premium, chic, environmentally conscious products and services. We have sales, marketing, and product development expertise primarily in the hospitality business in Europe and Asia. We currently sell and market products under our own proprietary name and we act as exclusive distributors primarily to companies to the hospitality trade. The brand portfolio consists of vendor-approved items for key foreign accounts, which include large hotel groups, such as Marriott Hotel Brands, The Four Seasons Hotel & Resorts, Hilton Worldwide, Hyatt Hotels & Resorts, Starwood Hotel & Resorts, and Fairmont Hotel & Resorts, and smaller hotel chains and upscale restaurants.

In the short term, management plans to raise funds through sales of our common stock for fulfillment (manufacturing, packaging and shipment), which will set the stage for future orders becoming self-funding. Then the next phase of our business plan will be to raise additional funds through common stock offerings to provide working capital to finance several acquisitions. We also intend to continue to strengthen our balance sheet by paying off debt through either exchange of equity for cancellation of debt obligations or the payment of debt obligations with cash.

When possible we have conserved our cash by paying employees, consultants, and independent contractors with our common stock.

RESULTS OF OPERATIONS

The following comparative analysis of results of operations are based primarily on the comparative financial statements, footnotes and related information for the periods identified below and should be read in conjunction with the financial statements and the notes to those statements that are included elsewhere in this report.

Comparison of Results of Operations for the Three and Six Months Ended June 30, 2016 and 2015

Revenues.

For the three months ended June 30, 2016, total revenues amounted to $63,808 as compared to $574,596 for the three months ended June 30, 2015, a decrease of $510,788 or 88.9%. For the six months ended June 30, 2016, total revenues amounted to $171,429 as compared to $1,349,090 for the six months ended June 30, 2015, a decrease of $1,177,661 or 87.3%. We began selling products consisting of tableware products, decorative hotel room amenities, lavatory and bathroom fixtures and furniture, food and beverage service items, and trendy accessories in January 2015. For the three and six months ended June 30, 2016 and 2015, total revenues consisted of the following:

	Three Months ended June 30,				Six Months ended June 30,
	2016		2015		2016		2015
Revenues:
Products	$	50,619	$	567,763	$	150,069	$	1,248,416
Shipping		13,189		6,833		21,360		100,674
Total revenues	$	63,808	$	574,596	$	171,429	$	1,349,090

During the six months ended June 30, 2015, we generated significant revenues from five customers that accounted for approximately 88.9% of total revenues (22.9%, 14.3%, 23.0%, 13.8% and 14.9%, respectively). During the six months ended June 30, 2016, three customers accounted for approximately 46.2% of total sales (10.2%, 10.5% and 25.5%, respectively). We did not have such large orders during the six months ended June 30, 2016.

Cost of revenues.

Cost of revenues includes cost of product and shipping and handling costs. For the three months ended June 30, 2016, cost of revenues amounted to $58,626 as compared to $488,375 for the three months ended June 30, 2015, a decrease of $429,749 or 88.0%. For the six months ended June 30, 2016, cost of revenues amounted to $133,896 as compared to $1,242,904 for the six months ended June 30, 2015, a decrease of $1,109,008 or 89.2%. For the three and six months ended June 30, 2016 and 2015, total cost of revenues consisted of the following:

	Three Months ended June 30,				Six Months ended June 30,
	2016		2015		2016		2015
Cost of revenues:
Products	$	45,460	$	482,188	$	106,146	$	1,116,886
Shipping		13,166		6,187		27,750		126,018
Total cost of revenues	$	58,626	$	488,375	$	133,896	$	1,242,904

Gross profit and gross margin.

For the three months ended June 30, 2016, gross profit amounted to $5,182 or 8.1% as compared to $86,221 or 15.0% for the three months ended June 30, 2015. For the six months ended June 30, 2016, gross profit amounted to $37,533 or 21.9% as compared to $106,186 or 7.9% for the six months ended June 30, 2015. For the six months ended June 30, 2016, the increase in gross margin percentage was attributable to an increase in operational and pricing efficiencies. Gross margin percentages can fluctuate from period to periods depending on the mix of product sold. We expect gross profits to increase in future periods as revenues increase and as we develop additional operational and pricing efficiencies.

Operating expenses.

For the three months ended June 30, 2016, operating expenses amounted to $193,967 as compared to $96,095 for the three months ended June 30, 2015, an increase of $97,872 or 101.8%. For the six months ended June 30, 2016, operating expenses amounted to $455,976 as compared to $195,364 for the six months ended June 30, 2015, an increase of $260,612 or 133.4%.

For the three and six months ended June 30, 2016 and 2015, operating expenses consisted of the following:

	Three Months ended June 30,				Six Months ended June 30,
	2016		2015		2016		2015
Compensation and related benefits	$	32,000	$	2,600	$	33,000	$	12,600
Consulting fees		64,574		28,526		144,340		36,248
Professional fees		33,388		21,524		98,804		29,709
Rent expense		13,059		13,504		35,216		48,623
General and administrative expenses		50,946		29,941		144,616		68,184
Total operating expenses	$	193,967	$	96,095	$	455,976	$	195,364

	·	For the three and six months ended June 30, 2016, compensation and related benefit expensed increased by $29,400 or 1,130.8%, and $20,400 or 161.9% as compared to the three and six months ended June 30, 2015. The increase was attributable to an increase in compensation paid to our chief executive officer. We expect compensation and related benefit expense to increase in the future as we increase our operations.

	·	For the three and six months ended June 30, 2016, consulting fees increased by $36,048 or 126.4%, and $108,092 or 298.2%, as compared to the three and six months ended June 30, 2015, respectively. Consulting fees consists of stock-based consulting fees for business development services. The increases were attributable to the amortization of prepaid consulting fees during the 2016 period for stock issued in 2015.

	·	For the three and six months ended June 30, 2016, professional fees increased by $11,864 or 55.1%, and $69,095 or 232.6% as compared to the three and six months ended June 30, 2015, respectively. These increases were attributable to an increase in accounting fees of $12,025 and $55,025 related to the re-audit of our 2015 and 2014 financial statements and to the hiring of additional accounting assistance, an increase in legal fees of $125 and $11,790, and an (decrease) increase in other professional fees $(286) and $2,280, respectively.

	·	For the three and six months ended June 30, 2016, rent expense fees decreased by $445 or 3.3%, and $13,407 or 27.6%, as compared to the three and six months ended June 30, 2015, respectively. These decreases was attributable to a decrease in rent incurred for warehouse expenses of $0 and $25,800, offset by an (decrease) increase in rent expense for office space located in the United Kingdom and United States of $(445) and $12,393, respectively.

	·	For the three and six months ended June 30, 2016, general and administrative expenses increased by $21,005 or 70.1%, and $76,432 or 112.1% as compared to the three and six months ended June 30, 2015, respectively. These increases were primarily attributable to an increase in computer and internet expense of $3,574 and $46,012 incurred for the upgrade of the our website and logistics capabilities, an increase in travel expenses of $23,956 and $28,260, and a (decrease) increase in other general and administrative expenses of $(6,525) and $2,160, respectively.

Loss from operations.

Because of the factors described above, for the three months ended June 30, 2016, loss from operations amounted to $188,785 as compared to a loss from operations of $9,874 for the three months ended June 30, 2015, an increase of $178,911 or 1,811.9% and for the six months ended June 30, 2016, loss from operations amounted to $418,443 as compared to a loss from operations of $89,178 for the six months ended June 30, 2015, an increase of $329,265 or 369.2%.

Other expenses.

Other expenses includes interest expense and a gain on derivative liability. For the three months ended June 30, 2016, total other expense amounted to $72,832 as compared to $47 for the three months ended June 30, 2015, an increase of $72,785. For the six months ended June 30, 2016, total other expense amounted to $90,133 as compared to $47 for the six months ended June 30, 2015, an increase of $90,086. For the three and six months ended June 30, 2016, we incurred interest expense of $87,525 and $145,633, respectively, which includes $41,040 and $52,662, respectively, related to interest bearing debt, and amortization of debt issuance costs of $46,485 and $92,971, respectively. Additionally, the three and six months ended June 30, 2016, we recorded a gain on the change of fair value of derivative liability of $14,693 and $55,500, respectively.

Net loss.

As a result of the foregoing, for the three months ended June 30, 2016, net loss amounted to $261,617 or $(0.01) per common share as compared to a net loss of $9,921 or $(0.00) per common share for the three months ended June 30, 2015, an increase of $251,696, and for the six months ended June 30, 2016, net loss amounted to $508,576 or $(0.02) per common share as compared to a net loss of $89,225 or $(0.01) per common share for the six months ended June 30, 2015, an increase of $419,351.

LIQUIDITY AND CAPITAL RESOURCES

Liquidity is the ability of an enterprise to generate adequate amounts of cash to meet its needs for cash requirements. We had working capital of $92,146 and $46,788 of cash as of June 30, 2016 and working capital of $63,936 and $208,064 of cash as of December 31, 2015.

The following table sets forth a summary of changes in our working capital from December 31, 2015 to June 30, 2016:

					December 31, 2015 to June 30, 2016
	June 30, 2016		December 31, 2015		Change			Percentage Change
Working capital:
Total current assets	$	202,796	$	350,372	$	(147,576	)		(42.1	)%
Total current liabilities		110,650		286,436		175,786			61.4	%
Working capital:	$	92,146	$	63,936	$	28,210			44.1	%

The increase in working capital was primarily attributable to:

an increase in accounts receivable of $16,977,

an increase in advances to supplier of $97,872,

an increase in accrued expenses of $2,497.

Offset by:

a decrease in cash of $161,276 as discussed below,

a decrease in prepaid expenses of $117,149 related to the amortization of prepaid consulting fees, and,

a decrease in convertible notes of $38,673,

a decrease in accounts payable of $35,445,

a decrease in due to related party of $35,879, and,

a decrease in derivative liability of $68,286.

Net cash flow used in operating activities was $473,753 for the six months ended June 30, 2016 as compared to net cash used in operating activities of $59,423 for the six months ended June 30, 2015, an increase of $414,330.

	·	Net cash flow used in operating activities for the six months ended June 30, 2016 primarily reflected a net loss of $508,576 and the add-back of non-cash items consisting of amortization of debt discount to interest expense of $92,971, stock-based compensation expense of $117,149, stock-based interest expense for debt addendum of $28,000, and a gain on derivative liability of $55,500, and changes in operating assets and liabilities primarily consisting of an increase in accounts receivable of $16,977, an increase in advances to supplier of $97,872, and a decrease in accounts payable of $35,445.

	·	Net cash flow used in operating activities for the six months ended June 30, 2015 primarily reflected a net loss of $89,225 and the add-back of non-cash items consisting of stock-based compensation expense of $36,248, and net changes in operating assets and liabilities of $6,446.

Net cash provided by financing activities was $312,477 for the six months ended June 30, 2016 as compared to net cash provided by financing activities $4,017 for the six months ended June 30, 2015. During the six months ended June 30, 2016, we received net proceeds from the sale of common stock of $480,000 and we repaid related party advances of $35,879 and repaid convertible debt of $131,644. During the six months ended June 30, 2015, we received net proceeds from the sale of common stock of $5,000 and we paid related party advances of $983.

Future Liquidity and Capital Needs.

Our principal future uses of cash are for working capital requirements, including marketing and travel expenses, legal and other professional fees incurred in connection with our SEC filing requirements, and reduction of accrued liabilities and debt. These uses will depend on numerous factors including our revenues, and our ability to control costs. We have historically financed our working capital needs primarily through internally generated funds, from the sale of common stock and from debt financings. We collect cash from our customers based on our sales to them and their respective payment terms. We expect to require additional funds through public or private debt or equity financings to be able to increase marketing for our products and to fully execute our business plan. If we are unable to raise the capital we need, we may need to reduce the scope of our business in order to continue our operations.

Recent Financings

On December 28, 2015, we entered into a secured convertible promissory note (the “Convertible Note”) with Firstfire Global Opportunities Fund LLC (the “Lender”), with a principal amount of $230,000, which amount is the $200,000 purchase price plus a 15% original issue discount equal to $30,000. Additionally, the lender deducted legal fees of $10,000 and the Company received net proceeds of $190,000. The unpaid principal and interest is secured by our common stock, bears interest computed at a rate of interest, which is equal to 7.0% per annum, and is payable in monthly installments of $50,555 commencing April 28, 2016 through August 28, 2016. Any amount of principal or interest on this Convertible Note, which is not paid by the due dates, shall bear interest at the rate of 15% per annum from the due date until paid. During the six months ended June 30, 2016, we repaid Convertible Note principal of $131,644.

The Lender is entitled, at their option, at any time after the eighth monthly anniversary of this Convertible Note, to convert all or any lesser portion of the outstanding principal amount and accrued but unpaid interest into our common stock. The conversion price shall equal $0.50 per share (the "Fixed Conversion Price") provided, however that from and after the occurrence of any event of default, as defined, the conversion price shall be the lower of: (i) the Fixed Conversion Price or (ii) 50% multiplied by the lowest sales price of the common stock in a public market during the ten consecutive Trading Day period immediately preceding the Trading Day that the Company receives a notice of conversion. In connection with the issuance of this Convertible Note, we determined that the terms of the Convertible Note include a down-round provision under which the conversion price and exercise price could be affected by future equity offerings undertaken by us or contain terms that are not fixed monetary amounts at inception. Accordingly, under the provisions of FASB ASC Topic No. 815-40, “Derivatives and Hedging – Contracts in an Entity’s Own Stock”, the embedded conversion option contained in the convertible instruments were accounted for as derivative liabilities at the date of issuance and shall be adjusted to fair value through earnings at each reporting date. Additionally, in connection with this Convertible Note, we paid Lender debt issuance costs of $10,000 and issued 50,000 shares of its common stock. These common shares were valued at $0.225 per share based on recent sales of our stock and we recorded a debt discount of $10,725, which is the relative fair value of such shares.

CRITICAL ACCOUNTING POLICIES

Our discussion and analysis of our financial condition and results of operations are based upon our unaudited consolidated financial statements, which have been prepared in accordance with accounting principles generally accepted in the United States. The preparation of these unaudited consolidated financial statements requires us to make estimates and judgments that affect the reported amounts of assets, liabilities, revenues and expenses, and related disclosure of contingent assets and liabilities. We continually evaluate our estimates, including those related to income taxes, and the valuation of equity transactions. We base our estimates on historical experience and on various other assumptions that we believed to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities that are not readily apparent from other sources. Any future changes to these estimates and assumptions could cause a material change to our reported amounts of revenues, expenses, assets and liabilities. Actual results may differ from these estimates under different assumptions or conditions. We believe the following critical accounting policies affect our more significant judgments and estimates used in the preparation of the consolidated financial statements.

Derivative liabilities

We have certain financial instruments that are embedded derivatives associated with capital raises. We evaluate all its financial instruments to determine if those contracts or any potential embedded components of those contracts qualify as derivatives to be separately accounted for in accordance with FASB ASC 810-10-05-4 and 815-40. This accounting treatment requires that the carrying amount of any embedded derivatives be recorded at fair value at issuance and marked-to-market at each balance sheet date. In the event that the fair value is recorded as a liability, as is the case with us, the change in the fair value during the period is recorded as either income or expense. Upon conversion or exercise, the derivative liability is marked to fair value at the conversion date and then the related fair value is reclassified to equity.

Revenue recognition

Pursuant to the guidance of ASC Topic 605, we recognize sales when persuasive evidence of an arrangement exists, delivery has occurred or services have been provided, the purchase price is fixed or determinable and collectability is reasonably assured. Our standard terms are ex works, with title transferring to our customer at our suppliers loading dock or upon embarkation with risk of loss being assumed by the customer at the shipping point. We have a small percentage of sales with other terms, and revenue is recognized in accordance with the terms of the related customer purchase order. Shipping and handling costs billed to customers are recognized in net revenue.

Stock-based compensation

Pursuant to ASC Topic 505-50, for share-based payments to consultants and other third parties, compensation expense is determined at the “measurement date.” The expense is recognized over the service period of the award. Common stock awards issued to consultants represent common stock granted to non-employees in exchange for services at fair value. The measurement dates for such awards are set at the dates that the contracts are entered into, as the awards are non-forfeitable and vest immediately. The measurement date fair value is then recognized over the service period as if we had paid cash for such service.

CONTRACTUAL OBLIGATIONS AND OFF-BALANCE SHEET ARRANGEMENTS

Contractual Obligations

We have certain fixed contractual obligations and commitments that include future estimated payments. Changes in our business needs, cancellation provisions, changing interest rates, and other factors may result in actual payments differing from the estimates. We cannot provide certainty regarding the timing and amounts of payments. We have presented below a summary of the most significant assumptions used in our determination of amounts presented in the tables, in order to assist in the review of this information within the context of our consolidated financial position, results of operations, and cash flows.

The following tables summarize our contractual obligations as of June 30, 2016, and the effect these obligations are expected to have on our liquidity and cash flows in future periods.

	Payments Due by Period
Contractual obligations:	Total		Less than 1 year		1-3 years		3-5 years		5 ⁺ years
Convertible notes payable	$	118,356	$	118,356	$	-	$	-	$	-
Operating lease		10,945		10,945		-		-		-
Total	$	129,301	$	129,301	$	-	$	-	$	-

Off-Balance Sheet Arrangements

We have not entered into any other financial guarantees or other commitments to guarantee the payment obligations of any third parties. We have not entered into any derivative contracts that are indexed to our shares and classified as shareholder’s equity or that are not reflected in our consolidated financial statements. Furthermore, we do not have any retained or contingent interest in assets transferred to an unconsolidated entity that serves as credit, liquidity or market risk support to such entity. We do not have any variable interest in any unconsolidated entity that provides financing, liquidity, market risk or credit support to us or engages in leasing, hedging or research and development services with us.

Item 3. Quantitative and Qualitative Disclosures about Market Risk

Not applicable to smaller reporting companies.

Item 4. Controls and Procedures

Evaluation of Disclosure Controls and Procedures

We have carried out an evaluation, under the supervision and with the participation of our management, including our Chief Executive Officer/Principal Financial Officer, of the effectiveness of our disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e) under the Securities Exchange Act of 1934, as amended (the “Exchange Act”)) as of June 30, 2016. Based on such evaluation, we have concluded that, as of such date, our disclosure controls and procedures were not effective to ensure that information required to be disclosed by us in our Exchange Act reports is recorded, processed, summarized and reported within the time periods specified in applicable SEC rules and forms, and that such information is accumulated and communicated to our management, including our Chief Executive Officer/Principal Financial Officer, as appropriate, to allow timely discussions regarding required disclosure.

Changes in Internal Control Over Financial Reporting

There were no changes (including corrective actions with regard to significant deficiencies or material weaknesses) in our internal control over financial reporting that occurred during the period covered by this report that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

PART II. OTHER INFORMATION

Item 1. Legal Proceedings

As of the date of this quarterly report, management is not aware of any legal proceedings contemplated by any governmental authority or any other party involving us.

Item 1A. Risk Factors

Not required of smaller reporting companies

Item 2. Unregistered Sales of Equity Securities and Use of Proceeds

On April 20, 2016 and June 6, 2016, we entered into agreements for the addendum of the Convertible Note with Firstfire Global Opportunities Fund LLC (see Note 3) which waived all rights to enforce any event of default, which may have been triggered by our failure to file it reports with the SEC. In connection with these agreements, we issued 30,000 and 40,000 shares of common stock, respectively, for an aggregate of 70,000 shares of common stock. These shares were valued on the date of grant at $0.40 per share or $28,000 based on recent sales of our common stock.

These shares were issued in a private transaction to one consultant in reliance on Rule 506 of Regulation D promulgated under the Securities Act.

Item 3. Defaults Upon Senior Securities

None.

Item 4. Mine Safety Disclosures

Not applicable.

Item 5. Other Information

None.

Item 6. Exhibits

Exhibit No.		Description
31.1*		Rule 13a-14(a)/15d-14(a) Certificate of Chief Executive Officer

31.2*		Rule 13a-14(a)/15d-14(a) Certificate of Chief Financial Officer

32.1*		Section 1350 Certificate of Chief Executive Officer and Chief Financial Officer

101.INS*		XBRL Instance Document
101.SCH*		XBRL Taxonomy Extension Schema
101.CAL*		XBRL Taxonomy Extension Calculation
101.DEF*		XBRL Taxonomy Extension Definition
101.LAB*		XBRL Taxonomy Extension Labels
101.PRE*		XBRL Taxonomy Extension Presentation Linkbase

*	Filed herewith.

SIGNATURES

Pursuant to the requirements of the Securities and Exchange Act of 1934, the Registrant has duly caused this Report to be signed on its behalf by the undersigned thereunto duly authorized.

	Petrone Worldwide, Inc. (Registrant)

Date: September 30, 2016	/s/ Victor Petrone
	Victor Petrone
	Chief Executive Officer and President
	(principal executive officer)

Date: September 30, 2016	/s/ Victor Petrone
	Victor Petrone Chief Financial Officer (principal financial officer and principal accounting officer)

EX-31 2 ex311.htm EXHIBIT 31.1

Exhibit 31.1

CERTIFICATIONS

I, Victor Petrone, certify that:

1. I have reviewed this quarterly report on Form 10-Q for the period ended June 30, 2016 of Petrone Worldwide, Inc.;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4. The registrant's other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

(a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

(b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

(c) Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

(d) Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and

5. The registrant's other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions):

(a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and

(b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.

Date: September 30, 2016

/s/ Victor Petrone

Victor Petrone

Chief Executive Officer, (Principal executive officer)

EX-31 3 ex312.htm EXHIBIT 31.2

Exhibit 31.2

CERTIFICATIONS

I, Victor Petrone, certify that:

1. I have reviewed this quarterly report on Form 10-Q for the period ended June 30, 2016 of Petrone Worldwide, Inc.;

(b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.

Date: September 30, 2016

/s/ Victor Petrone

Victor Petrone

Chief Financial Officer (Principal financial officer)

EX-32 4 ex321.htm EXHIBIT 32.1

CERTIFICATION PURSUANT TO

18 U.S.C. SECTION 1350,

AS ADOPTED PURSUANT TO

SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

In connection with the quarterly report on Form 10-Q for the period ended June 30, 2016 of Petrone Worldwide, Inc. (the “Company”), as filed with the Securities and Exchange Commission on the date hereof (the “Report”), I, Victor Petrone, President/Chief Executive Officer, Secretary, Treasurer/Chief Financial Officer of the Company, certify, pursuant to 18 U.S.C. § 1350, as adopted pursuant to § 906 of the Sarbanes-Oxley Act of 2002, that:

	1.	The Report fully complies with the requirements of section 13(a) or 15(d) of the Securities Exchange Act of 1934, as amended; and
	2.	The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

Date: September 30, 2016	/s/ Victor Petrone
	Victor Petrone
	President and Chief Executive Officer, Secretary, Treasurer/Chief Financial Officer

A signed original of this written statement required by Section 906, or other document authenticating, acknowledging or otherwise adopting the signature that appears in typed form within the electronic version of this written statement required by Section 906, has been provided to the registrant and will be retained by the registrant and furnished to the Securities and Exchange Commission or its staff upon request.

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NOTE 1 – ORGANIZATION AND BASIS OF PRESENTATION   Organization Petrone Worldwide, Inc. (the “Company”) was incorporated as Sheridan Industries, Inc. on December 14, 1998 in the State of Nevada. On December 31, 1998, the Company changed its name to Diabetex International Corp. and effective February 18, 2014, the Company changed its name to Petrone Worldwide, Inc.   On January 29, 2014 and effective March 3, 2014, the Company entered into a purchase agreement (the “Purchase Agreement”) with Petrone Food Works, Inc. (“PFW”) and the shareholder of PFW. Pursuant to the Purchase Agreement, the Company acquired 100% of PFW’s issued and outstanding common stock from the PFW shareholder in exchange for the issuance of 11,760,542 shares of the Company’s common stock, representing 98.4% of the outstanding common stock, (the “Exchange”), after giving effect to a 1-for-500 reverse stock split (the “Reverse Stock Split”) which resulted in 195,607 common shares outstanding prior to the Exchange for liabilities of $30,000. Accordingly, the PFW shareholder became a shareholder of the Company and PFW became a subsidiary of the Company. The Exchange has been accounted for as a reverse-merger and recapitalization since the stockholder of PFW obtained voting and management control of the Company. PFW is the acquirer for financial reporting purposes and the Company is the acquired company. Consequently, the assets and liabilities and the operations reflected in the historical financial statements prior to the Exchange are those of PFW and was recorded at the historical cost basis of PFW, and the consolidated financial statements after completion of the Exchange included the assets and liabilities of both the Company and PFW and the Company’s consolidated operations from the closing date of the Exchange. All share and per share data in the accompanying consolidated financial statements have been retroactively restated to reflect the effect of the Reverse Stock Split and recapitalization. PFW was formed under the laws of the State of Nevada in October 2013.   The Company is in the hospitality industry and is a supplier of tabletop kitchenware and hotel room products thru an exclusive licensing agreement with a leading supplier.   Basis of Presentation and Principles of Consolidation   The Company’s unaudited consolidated financial statements include the financial statements of its wholly-owned subsidiary, Petrone Food Works, Inc. (inactive). All significant intercompany accounts and transactions have been eliminated in consolidation.   The consolidated financial statements for the three and six months ended June 30, 2016 and 2015 have been prepared by us without audit pursuant to the rules and regulations of the Securities and Exchange Commission. In the opinion of management, all adjustments necessary to present fairly our financial position, results of operations, and cash flows as of June 30, 2016 and 2015, and for the periods then ended, have been made. Those adjustments consist of normal and recurring adjustments. Certain information and note disclosures normally included in our annual financial statements prepared in accordance with generally accepted accounting principles have been or omitted. The unaudited consolidated financial statements should be read in conjunction with the audited consolidated financial statements as of and for the year ended December 31, 2015 and footnotes thereto included in the Company’s Annual Report on Form 10-K filed with the SEC on September 9, 2016. The results of operations for the six months ended June 30, 2016 are not necessarily indicative of the results to be expected for the full year.   Going concern   These unaudited consolidated financial statements have been prepared on a going concern basis, which contemplates the realization of assets and the settlement of liabilities and commitments in the normal course of business. As reflected in the accompanying unaudited consolidated financial statements, for the six months ended June 30, 2016, the Company had a net loss of $508,576 and net cash used in operations of $473,753. Additionally, the Company had an accumulated deficit, stockholders’ equity and working capital of $3,188,682, $92,146 and $92,146, respectively, at June 30, 2016. These factors raise substantial doubt about the Company’s ability to continue as a going concern. Management cannot provide assurance that the Company will ultimately achieve profitable operations or become cash flow positive, or raise additional debt and/or equity capital. The Company is seeking to raise capital through additional debt and/or equity financings to fund its operations in the future. Although the Company has historically raised capital from sales of equity and from the issuance of promissory notes, there is no assurance that it will be able to continue to do so. If the Company is unable to raise additional capital or secure additional lending in the near future, management expects that the Company will need to curtail its operations. These consolidated financial statements do not include any adjustments related to the recoverability and classification of assets or the amounts and classification of liabilities that might be necessary should the Company be unable to continue as a going concern.

NOTE 2 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES   Use of estimates   The preparation of consolidated financial statements in conformity with accounting principles generally accepted in the United States 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 consolidated financial statements and the reported amounts of revenue and expenses during the reporting period. Actual results could differ from those estimates. Significant estimates for the six months ended June 30, 2016 and 2015 include estimates of current and deferred income taxes and deferred tax valuation allowances, the fair value of derivative liabilities, and the fair value of non-cash equity transactions.   Fair value of financial instruments and fair value measurements   The Company adopted the guidance of Accounting Standards Codification (“ASC”) 820 for fair value measurements which clarifies the definition of fair value, prescribes methods for measuring fair value, and establishes a fair value hierarchy to classify the inputs used in measuring fair value as follows:   Level 1- Inputs are unadjusted quoted prices in active markets for identical assets or liabilities available at the measurement date.   Level 2- Inputs are quoted prices for similar assets and liabilities in active markets, quoted prices for identical or similar assets and liabilities in markets that are not active, inputs other than quoted prices that are observable, and inputs derived from or corroborated by observable market data.   Level 3- Inputs are unobservable inputs that reflect the reporting entity’s own assumptions on what assumptions the market participants would use in pricing the asset or liability based on the best available information.   The carrying amounts reported in the consolidated balance sheets for cash and cash equivalents, accounts receivable, loans, accounts payable, accrued expenses, and other payables approximate their fair market value based on the short-term maturity of these instruments.   The Company analyzes all financial and non-financial instruments with features of both liabilities and equity under the FASB’s accounting standard for such instruments. Under this standard, financial and non-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 accounts for one instrument at fair value using level 3 valuation.   <table cellspacing="0" cellpadding="0" style="font: 10pt/normal Times New Roman, Times, Serif; width: 100%; border-collapse: collapse; font-size-adjust: none; font-stretch: normal"> <tr style="vertical-align: bottom"> <td> </td> <td style="line-height: normal; padding-bottom: 1pt; font-size-adjust: none; font-stretch: normal"> </td> <td colspan="11" style="line-height: normal; text-align: center; border-bottom: black 1pt solid; font-size-adjust: none; font-stretch: normal">At June 30, 2016</td> <td style="line-height: normal; padding-bottom: 1pt; font-size-adjust: none; font-stretch: normal"> </td> <td colspan="11" style="line-height: normal; text-align: center; border-bottom: black 1pt solid; font-size-adjust: none; font-stretch: normal">At December 31, 2015</td></tr> <tr style="vertical-align: bottom; background-color: rgb(204, 238, 255)"> <td style="line-height: normal; padding-bottom: 1pt; padding-left: 5.4pt; font-size-adjust: none; font-stretch: normal">Description</td> <td style="line-height: normal; padding-bottom: 1pt; font-size-adjust: none; font-stretch: normal"> </td> <td style="line-height: normal; text-align: left; border-bottom: black 1pt solid; font-size-adjust: none; font-stretch: normal"> </td> <td style="line-height: normal; text-align: right; border-bottom: black 1pt solid; font-size-adjust: none; font-stretch: normal">Level 1</td> <td style="line-height: normal; text-align: left; padding-bottom: 1pt; font-size-adjust: none; font-stretch: normal"> </td> <td style="line-height: normal; padding-bottom: 1pt; font-size-adjust: none; font-stretch: normal"> </td> <td style="line-height: normal; text-align: left; border-bottom: black 1pt solid; font-size-adjust: none; font-stretch: normal"> </td> <td style="line-height: normal; text-align: right; border-bottom: black 1pt solid; font-size-adjust: none; font-stretch: normal">Level 2</td> <td style="line-height: normal; text-align: left; padding-bottom: 1pt; font-size-adjust: none; font-stretch: normal"> </td> <td style="line-height: normal; padding-bottom: 1pt; font-size-adjust: none; font-stretch: normal"> </td> <td style="line-height: normal; text-align: left; border-bottom: black 1pt solid; font-size-adjust: none; font-stretch: normal"> </td> <td style="line-height: normal; text-align: right; border-bottom: black 1pt solid; font-size-adjust: none; font-stretch: normal">Level 3</td> <td style="line-height: normal; text-align: left; padding-bottom: 1pt; font-size-adjust: none; font-stretch: normal"> </td> <td style="line-height: normal; padding-bottom: 1pt; font-size-adjust: none; font-stretch: normal"> </td> <td style="line-height: normal; text-align: left; border-bottom: black 1pt solid; font-size-adjust: none; font-stretch: normal"> </td> <td style="line-height: normal; text-align: right; border-bottom: black 1pt solid; font-size-adjust: none; font-stretch: normal">Level 1</td> <td style="line-height: normal; text-align: left; padding-bottom: 1pt; font-size-adjust: none; font-stretch: normal"> </td> <td style="line-height: normal; padding-bottom: 1pt; font-size-adjust: none; font-stretch: normal"> </td> <td style="line-height: normal; text-align: left; border-bottom: black 1pt solid; font-size-adjust: none; font-stretch: normal"> </td> <td style="line-height: normal; text-align: right; border-bottom: black 1pt solid; font-size-adjust: none; font-stretch: normal">Level 2</td> <td style="line-height: normal; text-align: left; padding-bottom: 1pt; font-size-adjust: none; font-stretch: normal"> </td> <td style="line-height: normal; padding-bottom: 1pt; font-size-adjust: none; font-stretch: normal"> </td> <td style="line-height: normal; text-align: left; border-bottom: black 1pt solid; font-size-adjust: none; font-stretch: normal"> </td> <td style="line-height: normal; text-align: right; border-bottom: black 1pt solid; font-size-adjust: none; font-stretch: normal">Level 3</td> <td style="line-height: normal; text-align: left; padding-bottom: 1pt; font-size-adjust: none; font-stretch: normal"> </td></tr> <tr style="vertical-align: bottom; background-color: white"> <td style="line-height: normal; width: 46%; text-align: left; padding-left: 5.4pt; font-size-adjust: none; font-stretch: normal">Derivative liability</td> <td style="line-height: normal; width: 1%; font-size-adjust: none; font-stretch: normal"> </td> <td style="line-height: normal; width: 1%; text-align: left; font-size-adjust: none; font-stretch: normal"> </td> <td style="line-height: normal; width: 6%; text-align: right; font-size-adjust: none; font-stretch: normal">—  </td> <td style="line-height: normal; width: 1%; text-align: left; font-size-adjust: none; font-stretch: normal"> </td> <td style="line-height: normal; width: 1%; font-size-adjust: none; font-stretch: normal"> </td> <td style="line-height: normal; width: 1%; text-align: left; font-size-adjust: none; font-stretch: normal"> </td> <td style="line-height: normal; width: 6%; text-align: right; font-size-adjust: none; font-stretch: normal">—  </td> <td style="line-height: normal; width: 1%; text-align: left; font-size-adjust: none; font-stretch: normal"> </td> <td style="line-height: normal; width: 1%; font-size-adjust: none; font-stretch: normal"> </td> <td style="line-height: normal; width: 1%; text-align: left; font-size-adjust: none; font-stretch: normal">$</td> <td style="line-height: normal; width: 6%; text-align: right; font-size-adjust: none; font-stretch: normal">4,950</td> <td style="line-height: normal; width: 1%; text-align: left; font-size-adjust: none; font-stretch: normal"> </td> <td style="line-height: normal; width: 1%; font-size-adjust: none; font-stretch: normal"> </td> <td style="line-height: normal; width: 1%; text-align: left; font-size-adjust: none; font-stretch: normal"> </td> <td style="line-height: normal; width: 6%; text-align: right; font-size-adjust: none; font-stretch: normal">—  </td> <td style="line-height: normal; width: 1%; text-align: left; font-size-adjust: none; font-stretch: normal"> </td> <td style="line-height: normal; width: 1%; font-size-adjust: none; font-stretch: normal"> </td> <td style="line-height: normal; width: 1%; text-align: left; font-size-adjust: none; font-stretch: normal"> </td> <td style="line-height: normal; width: 6%; text-align: right; font-size-adjust: none; font-stretch: normal">—  </td> <td style="line-height: normal; width: 1%; text-align: left; font-size-adjust: none; font-stretch: normal"> </td> <td style="line-height: normal; width: 1%; font-size-adjust: none; font-stretch: normal"> </td> <td style="line-height: normal; width: 1%; text-align: left; font-size-adjust: none; font-stretch: normal">$</td> <td style="line-height: normal; width: 6%; text-align: right; font-size-adjust: none; font-stretch: normal">73,236</td> <td style="line-height: normal; width: 1%; text-align: left; font-size-adjust: none; font-stretch: normal"> </td></tr> </table>     A roll forward of the level 3 valuation financial instruments is as follows:     <table cellspacing="0" cellpadding="0" style="font: 10pt/normal Times New Roman, Times, Serif; width: 100%; border-collapse: collapse; font-size-adjust: none; font-stretch: normal"> <tr style="vertical-align: bottom; background-color: rgb(204, 238, 255)"> <td style="text-align: justify; padding-bottom: 1pt; width: 70%"> </td> <td style="line-height: normal; text-align: center; padding-bottom: 1pt; padding-left: 10pt; font-size-adjust: none; font-stretch: normal; width: 10%"> </td> <td style="padding-bottom: 1pt; width: 1%"> </td> <td style="text-align: center; border-bottom: black 1pt solid; width: 18%">Derivative Liability</td> <td style="text-align: right; border-bottom: black 1pt solid; width: 1%"> </td> <td style="text-align: left; padding-bottom: 1pt"> </td></tr> <tr style="vertical-align: bottom; background-color: white"> <td style="line-height: normal; text-align: justify; padding-left: 5.4pt; font-size-adjust: none; font-stretch: normal">Balance at December 31, 2015</td> <td style="line-height: normal; font-size-adjust: none; font-stretch: normal"> </td> <td style="line-height: normal; text-align: left; font-size-adjust: none; font-stretch: normal">$</td> <td style="line-height: normal; text-align: right; font-size-adjust: none; font-stretch: normal">73,236</td> <td style="line-height: normal; text-align: left; font-size-adjust: none; font-stretch: normal"> </td></tr> <tr style="vertical-align: bottom; background-color: rgb(204, 238, 255)"> <td style="line-height: normal; text-align: justify; padding-left: 5.4pt; font-size-adjust: none; font-stretch: normal">   Reclassification of derivative liability to equity</td> <td style="line-height: normal; font-size-adjust: none; font-stretch: normal"> </td> <td style="line-height: normal; text-align: left; font-size-adjust: none; font-stretch: normal"> </td> <td style="line-height: normal; text-align: right; font-size-adjust: none; font-stretch: normal">(12,786</td> <td style="line-height: normal; text-align: left; font-size-adjust: none; font-stretch: normal">)</td></tr> <tr style="vertical-align: bottom; background-color: white"> <td style="line-height: normal; text-align: justify; padding-bottom: 1pt; padding-left: 5.4pt; font-size-adjust: none; font-stretch: normal">   Change in fair value included in net loss</td> <td style="line-height: normal; padding-bottom: 1pt; font-size-adjust: none; font-stretch: normal"> </td> <td style="line-height: normal; text-align: left; border-bottom: black 1pt solid; font-size-adjust: none; font-stretch: normal"> </td> <td style="line-height: normal; text-align: right; border-bottom: black 1pt solid; font-size-adjust: none; font-stretch: normal">(55,500</td> <td style="line-height: normal; text-align: left; padding-bottom: 1pt; font-size-adjust: none; font-stretch: normal">)</td></tr> <tr style="vertical-align: bottom; background-color: rgb(204, 238, 255)"> <td style="line-height: normal; text-align: justify; padding-bottom: 2.5pt; padding-left: 5.4pt; font-size-adjust: none; font-stretch: normal">Balance at June 30, 2016</td> <td style="line-height: normal; padding-bottom: 2.5pt; font-size-adjust: none; font-stretch: normal"> </td> <td style="line-height: normal; text-align: left; border-bottom: black 2.5pt double; font-size-adjust: none; font-stretch: normal">$</td> <td style="line-height: normal; text-align: right; border-bottom: black 2.5pt double; font-size-adjust: none; font-stretch: normal">4,950</td> <td style="line-height: normal; text-align: left; padding-bottom: 2.5pt; font-size-adjust: none; font-stretch: normal"> </td></tr> <tr style="vertical-align: bottom; background-color: white"> <td> </td> <td> </td> <td style="text-align: left"> </td> <td style="text-align: right"> </td> <td style="text-align: left"> </td></tr> </table>     ASC 825-10 “Financial Instruments”, allows entities to voluntarily choose to measure certain financial assets and liabilities at fair value (fair value option). The fair value option may be elected on an instrument-by-instrument basis and is irrevocable, unless a new election date occurs. If the fair value option is elected for an instrument, unrealized gains and losses for that instrument should be reported in earnings at each subsequent reporting date. The Company did not elect to apply the fair value option to any outstanding instruments.   Cash and cash equivalents <table cellpadding="0" cellspacing="0" style="width: 100%; font: 10pt/normal Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0"><tr style="vertical-align: top"> <td style="width: 0"></td><td style="width: 9pt"> </td><td></td></tr></table> For purposes of the consolidated statements of cash flows, the Company considers all highly liquid instruments with a maturity of three months or less at the purchase date and money market accounts to be cash equivalents. <table cellpadding="0" cellspacing="0" style="width: 100%; font: 10pt/normal Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0"><tr style="vertical-align: top"> <td style="width: 0"></td><td style="width: 9pt"> </td><td></td></tr></table> Accounts receivable   The Company recognizes an allowance for losses on accounts receivable in an amount equal to the estimated probable losses net of recoveries. The allowance is based on an analysis of historical bad debt experience, current receivables aging, and expected future write-offs, as well as an assessment of specific identifiable customer accounts considered at risk or uncollectible. The expense associated with the allowance for doubtful accounts is recognized as general and administrative expense.   Advances to Supplier   Advances to supplier represent the advance payments for the purchase of product from supplier.   Impairment of long-lived assets   In accordance with ASC Topic 360, the Company reviews long-lived assets for impairment whenever events or changes in circumstances indicate that the carrying amount of the assets may not be fully recoverable, or at least annually. The Company recognizes an impairment loss when the sum of expected undiscounted future cash flows is less than the carrying amount of the asset. The amount of impairment is measured as the difference between the asset’s estimated fair value and its book value.   Derivative liabilities   The Company has certain financial instruments that are embedded derivatives associated with capital raises. The Company evaluates all its financial instruments to determine if those contracts or any potential embedded components of those contracts qualify as derivatives to be separately accounted for in accordance with FASB ASC 810-10-05-4 and 815-40.  This accounting treatment requires that the carrying amount of any embedded derivatives be recorded at fair value at issuance and marked-to-market at each balance sheet date.  In the event that the fair value is recorded as a liability, as is the case with the Company, the change in the fair value during the period is recorded as either income or expense. Upon conversion or exercise, the derivative liability is marked to fair value at the conversion date and then the related fair value is reclassified to equity.     Revenue recognition   Pursuant to the guidance of ASC Topic 605, the Company recognizes sales when persuasive evidence of an arrangement exists, delivery has occurred or services have been provided, the purchase price is fixed or determinable and collectability is reasonably assured. The Company’s standard terms are “ex works”, with title transferring to its customer at the Company suppliers’ loading docks or upon embarkation with risk of loss being assumed by the customer at the shipping point. The Company has a small percentage of sales with other terms, and revenue is recognized in accordance with the terms of the related customer purchase order. Shipping and handling costs billed to customers are recognized in revenue.   Cost of sales   Cost of sales includes inventory costs, materials and supplies costs, and shipping and handling costs incurred.   Shipping and handling costs   For the six months ended June 30, 2016 and 2015, shipping and handling costs incurred for product shipped to customers are included in cost of sales and amounted to $27,750 and $126,018, respectively. Shipping and handling costs charged to customers are included in sales.   Advertising costs   All costs related to advertising of the Company’s products are expensed in the period incurred.   Income taxes   The Company accounts for income tax using the liability method prescribed by ASC 740, “Income Taxes”. Under this method, deferred tax assets and liabilities are determined based on the difference between the financial reporting and tax bases of assets and liabilities using enacted tax rates that will be in effect in the year in which the differences are expected to reverse. The Company records a valuation allowance to offset deferred tax assets if based on the weight of available evidence, it is more-likely-than-not that some portion, or all, of the deferred tax assets will not be realized. The effect on deferred taxes of a change in tax rates is recognized as income or loss in the period that includes the enactment date.   The Company follows the accounting guidance for uncertainty in income taxes using the provisions of Accounting Standards Codification (ASC) 740 “Income Taxes”. Using that guidance, tax positions initially need to be recognized in the financial statements when it is more likely than not the position will be sustained upon examination by the tax authorities. As of June 30, 2016 and December 31, 2015, the Company had no uncertain tax positions that qualify for either recognition or disclosure in the financial statements. The Company recognizes interest and penalties related to uncertain income tax positions in other expense. The Company did not record such interest or penalties for the six months ended June 30, 2016 and 2015.   Stock-based compensation    Stock-based compensation is accounted for based on the requirements of the Share-Based Payment Topic of ASC 718 which requires recognition in the financial statements of the cost of employee and director services received in exchange for an award of equity instruments over the period the employee or director is required to perform the services in exchange for the award (presumptively, the vesting period). The ASC also requires measurement of the cost of employee and director services received in exchange for an award based on the grant-date fair value of the award.     Pursuant to ASC Topic 505-50, for share-based payments to consultants and other third-parties, compensation expense is determined at the “measurement date.” The expense is recognized over the service period of the award. Common stock awards issued to consultants represent common stock granted to non-employees in exchange for services at fair value. The measurement dates for such awards are set at the dates that the contracts are entered into as the awards are non-forfeitable and vest immediately. The measurement date fair value is then recognized over the service period as if the Company has paid cash for such service.   Loss per share of common stock   ASC 260 “Earnings Per Share”, requires dual presentation of basic and diluted earnings per share (“EPS”) with a reconciliation of the numerator and denominator of the basic EPS computation to the numerator and denominator of the diluted EPS computation. Basic EPS excludes dilution. Diluted EPS reflects the potential dilution that could occur if securities or other contracts to issue common stock were exercised or converted into common stock or resulted in the issuance of common stock that then shared in the earnings of the entity. Basic net loss per common share is computed by dividing net loss available to common shareholders by the weighted average number of shares of common shares outstanding during the period. Diluted net loss per common share is computed by dividing net loss by the weighted average number of shares of common stock, common stock equivalents and potentially dilutive securities outstanding during each period. Additionally, potentially dilutive common shares consist of common stock issuable upon conversion of convertible debt. These common stock equivalents may be dilutive in the future. Potentially dilutive common shares were excluded from the computation of diluted shares outstanding as they would have an anti-dilutive impact on the Company’s net losses and consisted of the following:   <table cellspacing="0" cellpadding="0" style="font: 10pt/normal Times New Roman, Times, Serif; width: 100%; border-collapse: collapse; font-size-adjust: none; font-stretch: normal"> <tr style="vertical-align: bottom"> <td style="text-align: justify"> </td> <td style="line-height: normal; padding-bottom: 1pt; font-size-adjust: none; font-stretch: normal"> </td> <td colspan="3" style="line-height: normal; text-align: center; border-bottom: black 1pt solid; font-size-adjust: none; font-stretch: normal">June 30, 2016</td> <td style="line-height: normal; padding-bottom: 1pt; font-size-adjust: none; font-stretch: normal"> </td> <td colspan="3" style="line-height: normal; text-align: center; border-bottom: black 1pt solid; font-size-adjust: none; font-stretch: normal">June 30, 2015</td></tr> <tr style="vertical-align: bottom; background-color: rgb(204, 238, 255)"> <td style="line-height: normal; width: 58%; text-align: justify; padding-bottom: 2.5pt; padding-left: 5.4pt; font-size-adjust: none; font-stretch: normal">     Convertible notes</td> <td style="line-height: normal; width: 8%; padding-bottom: 2.5pt; font-size-adjust: none; font-stretch: normal"> </td> <td style="line-height: normal; width: 1%; text-align: left; border-bottom: black 2.5pt double; font-size-adjust: none; font-stretch: normal"> </td> <td style="line-height: normal; width: 11%; text-align: right; border-bottom: black 2.5pt double; font-size-adjust: none; font-stretch: normal">449,523</td> <td style="line-height: normal; width: 1%; text-align: left; padding-bottom: 2.5pt; font-size-adjust: none; font-stretch: normal"> </td> <td style="line-height: normal; width: 8%; padding-bottom: 2.5pt; font-size-adjust: none; font-stretch: normal"> </td> <td style="line-height: normal; width: 1%; text-align: left; border-bottom: black 2.5pt double; font-size-adjust: none; font-stretch: normal"> </td> <td style="line-height: normal; width: 11%; text-align: right; border-bottom: black 2.5pt double; font-size-adjust: none; font-stretch: normal">30,612</td> <td style="line-height: normal; width: 1%; text-align: left; padding-bottom: 2.5pt; font-size-adjust: none; font-stretch: normal"> </td></tr> </table>   Recent accounting pronouncements   In May 2014, the FASB issued an update ("ASU 2014-09") Revenue from Contracts with Customers.  ASU 2014-09 establishes a single comprehensive model for entities to use in accounting for revenue arising from contracts with customers and supersedes most of the existing revenue recognition guidance.  ASU 2014-09 requires an entity to recognize revenue when it transfers promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services and requires certain additional disclosures.  ASU 2014-09 is effective for interim and annual reporting periods in fiscal years that begin after December 15, 2016.  The Company is currently evaluating the impact of the adoption of ASU 2014-09 on its consolidated financial statements.   In June 2014, the FASB issued an update (“ASU 2014-12”) to ASC Topic 718, Compensation – Stock Compensation.  ASU 2014-12 requires an entity to treat performance targets that can be met after the requisite service period of a share-based award has ended, as a performance condition that affects vesting.  ASU 2014-12 is effective for interim and annual reporting periods in fiscal years that begin after December 15, 2015.  The adoption of ASU 2014-12 did not have a material effect on the Company’s financial position, results of operations and cash flows.   In August 2014, the FASB issued ASU 2014-15, Disclosure of Uncertainties About an Entity’s Ability to Continue as a Going Concern, that will require management to assess an entity’s ability to continue as a going concern, and to provide related footnote disclosures in certain circumstances. In connection with each annual and interim period, management will assess if there is substantial doubt about an entity’s ability to continue as a going concern within one year after the issuance date. Substantial doubt exists if it is probable that the entity will be unable to meet its obligations within one year after the issuance date. The new standard defines substantial doubt and provides example indicators. Disclosures will be required if conditions give rise to substantial doubt. However, management will need to assess if its plans will alleviate substantial doubt to determine the specific disclosures. This standard is effective for public entities for annual periods ending after December 15, 2016. Earlier application of this standard is permitted. This standard is not expected to have a material effect on our financial position, results of operations and cash flows.   In February 2015, the FASB issued ASU 2015-02, Consolidation (Topic 810) (“ASU 2015-02”), to address financial reporting considerations for the evaluation as to the requirement to consolidate certain legal entities. ASU 2015-02 is effective for fiscal years and for interim periods within those fiscal years beginning after December 15, 2015. This standard did not have a material effect on the Company’s financial position, results of operations and cash flows.   In April 2015, the FASB issued ASU 2015-03, Interest—Imputation of Interest (Subtopic 835-30) (“ASU 2015-03”), as part of the initiative to reduce complexity in accounting standards. The update requires that debt issuance costs related to a recognized debt liability be presented in the balance sheet as a direct deduction from the carrying amount of that debt liability, consistent with debt discounts. ASU 2015-03 is effective for annual periods beginning after December 15, 2015 and for interim periods within those fiscal years.   In November 2015, the FASB issued ASU 2015-17, Balance Sheet Classification of Deferred Taxes (“ASU 2015-17”), which requires entities to present deferred tax assets and deferred tax liabilities as noncurrent in a classified balance sheet. The ASU simplifies the current guidance in ASC Topic 740, Income Taxes, which requires entities to separately present deferred tax assets and liabilities as current and noncurrent in a classified balance sheet. ASU 2015-17 is effective for fiscal years beginning after December 15, 2016, and interim periods within those annual periods. Early adoption is permitted for all entities as of the beginning of an interim or annual reporting period. The Company does not expect the impact of ASU 2015-17 to be material to our consolidated financial statements.    There are no other recently issued accounting standards that apply to us or that are expected to have a material impact on our results of operations, financial condition, or cash flows.

NOTE 3 – CONVERTIBLE NOTES   In 2013 and on July 1, 2014, the Company entered into two convertible promissory note agreements with individuals in the amount of $20,000 and $10,000, respectively. The notes were non-interest bearing, unsecured and were due on demand. The notes are convertible into shares of stock of the Company at the market price on the date of conversion. Pursuant to ASC Topic 470-20 (Debt with conversion and other options), since these convertible notes had fixed conversion price at market, the Company determined it had a fixed monetary amounts that can be settled for the debt. Accordingly, no derivative liability was calculated. On December 22, 2015, the Company entered into a debt purchase and assignment agreement with one of the debt holders whereby a convertible note in the principal amount of $10,000 became convertible at $.0025 per common share and the note was converted into 4,000,000 shares of the Company’s common stock. At June 30, 2016, one note remains due in the principal amount of $20,000.   On December 28, 2015, the Company entered into a secured convertible promissory note (the “Convertible Note”) with Firstfire Global Opportunities Fund LLC (the “Lender”), with a principal amount of $230,000, which amount is the $200,000 purchase price plus a 15% original issue discount equal to $30,000. Additionally, the lender deducted legal fees of $10,000 and the Company received net proceeds of $190,000. The unpaid principal and interest is secured by the Company’s common stock, bears interest computed at a rate of interest that is equal to 7.0% per annum, and is payable in monthly installments of $50,555 commencing April 28, 2016 through August 28, 2016. Any amount of principal or interest on this Convertible Note, which is not paid by the due dates, shall bear interest at the rate of 15% per annum from the due date until paid. During the six months ended June 30, 2016, the Company repaid Convertible Note principal of $131,644.   The Lender is entitled, at their option, at any time after the eighth month anniversary of this Convertible Note, to convert all or any lesser portion of the outstanding principal amount and accrued but unpaid interest into the Company’s common stock. The conversion price shall equal $0.50 per share (the "Fixed Conversion Price") provided, however that from and after the occurrence of any event of default, as defined, the conversion price shall be the lower of: (i) the Fixed Conversion Price or (ii) 50% multiplied by the lowest sales price of the common stock in a public market during the ten consecutive Trading Day period immediately preceding the Trading Day that the Company receives a notice of conversion. In connection with the issuance of this Convertible Note, the Company determined that the terms of the Convertible Note include a down-round provision under which the conversion price and exercise price could be affected by future equity offerings undertaken by the Company or contain terms that are not fixed monetary amounts at inception. Accordingly, under the provisions of FASB ASC Topic No. 815-40, “Derivatives and Hedging – Contracts in an Entity’s Own Stock”, the embedded conversion option contained in the convertible instruments were accounted for as derivative liabilities at the date of issuance and shall be adjusted to fair value through earnings at each reporting date. The fair value of the embedded conversion option derivatives was determined using the Black- Scholes Option Pricing Model. On the initial measurement date, the fair values of the embedded conversion option derivative of $73,236 was recorded as a derivative liability and was allocated as a debt discount to the Convertible Note of $73,236. At December 28, 2015, the Company valued the embedded conversion option derivative liabilities resulting in no gain or loss from change in fair value of derivative liabilities. Additionally, in connection with this Convertible Note, in December 2015, the Company paid Lender debt issuance costs of $10,000 and issued 50,000 shares of its common stock. These common shares were valued at $0.225 per share based on recent sales of the Company’s stock and in December 2015, the Company recorded a debt discount of $10,725, which is the relative fair value of such shares.   At June 30, 2016, and December 31, 2015, the fair value of the derivative liabilities was estimated using the Black-scholes option-pricing model with the following assumptions:   <table cellspacing="0" cellpadding="0" style="font-size: 10pt; line-height: normal; width: 100%; border-collapse: collapse; font-size-adjust: none; font-stretch: normal"> <tr style="vertical-align: bottom"> <td style="font-size: 11pt"> </td> <td style="padding-bottom: 1pt"> </td> <td colspan="3" style="text-align: center; border-bottom: black 1pt solid">June 30, 2016</td> <td style="padding-bottom: 1pt"> </td> <td colspan="3" style="text-align: center; border-bottom: black 1pt solid">December 31, 2015</td></tr> <tr style="vertical-align: bottom; background-color: rgb(204, 238, 255)"> <td style="width: 59%; text-align: left; padding-left: 5.4pt">Dividend rate</td> <td style="width: 8%"> </td> <td style="width: 1%; text-align: left"> </td> <td style="width: 13%; text-align: right">0</td> <td style="width: 1%; text-align: left"> </td> <td style="width: 5%"> </td> <td style="width: 1%; text-align: left"> </td> <td style="width: 11%; text-align: right">0</td> <td style="width: 1%; text-align: left"> </td></tr> <tr style="vertical-align: bottom; background-color: white"> <td style="text-align: left; padding-left: 5.4pt">Term (in years)</td> <td> </td> <td style="text-align: left"> </td> <td style="text-align: right">0.41  to 0.125 years</td> <td style="text-align: left"> </td> <td> </td> <td style="text-align: left"> </td> <td style="text-align: right">0.67 years</td> <td style="text-align: left"> </td></tr> <tr style="vertical-align: bottom; background-color: rgb(204, 238, 255)"> <td style="padding-left: 5.4pt">Volatility</td> <td> </td> <td style="text-align: left"> </td> <td style="text-align: right">100.0</td> <td style="text-align: left">%</td> <td> </td> <td style="text-align: left"> </td> <td style="text-align: right">100.0</td> <td style="text-align: left">%</td></tr> <tr style="vertical-align: bottom; background-color: white"> <td style="text-align: left; padding-left: 5.4pt">Risk-free interest rate</td> <td> </td> <td style="text-align: left"> </td> <td style="text-align: right">0.26% to 0.39%</td> <td style="text-align: left"> </td> <td> </td> <td style="text-align: left"> </td> <td style="text-align: right">0.66</td> <td style="text-align: left">%</td></tr> </table>   For the six months ended June 30, 2016 and 2015, amortization of debt discounts related to this convertible note amounted to $92,971 and $0, which has been included in interest expenses on the accompanying unaudited consolidated statements of operations, respectively.   At June 30, 2016 and December 31, 2015, convertible promissory notes consisted of the following:   <table cellspacing="0" cellpadding="0" style="font-size: 10pt; line-height: normal; width: 100%; border-collapse: collapse; font-size-adjust: none; font-stretch: normal"> <tr style="vertical-align: bottom"> <td style="font-size: 11pt"> </td> <td style="padding-bottom: 1pt"> </td> <td colspan="3" style="text-align: center; border-bottom: black 1pt solid">June 30, 2016</td> <td style="padding-bottom: 1pt"> </td> <td colspan="3" style="text-align: center; border-bottom: black 1pt solid">December 31, 2015</td></tr> <tr style="vertical-align: bottom; background-color: rgb(204, 238, 255)"> <td style="width: 58%; text-align: left; padding-left: 5.4pt">Principal amount</td> <td style="width: 8%"> </td> <td style="width: 1%; text-align: left">$</td> <td style="width: 11%; text-align: right">118,356</td> <td style="width: 1%; text-align: left"> </td> <td style="width: 8%"> </td> <td style="width: 1%; text-align: left">$</td> <td style="width: 11%; text-align: right">250,000</td> <td style="width: 1%; text-align: left"> </td></tr> <tr style="vertical-align: bottom; background-color: white"> <td style="text-align: left; padding-bottom: 1pt; padding-left: 5.4pt">Less: unamortized debt discount</td> <td style="padding-bottom: 1pt"> </td> <td style="text-align: left; border-bottom: black 1pt solid"> </td> <td style="text-align: right; border-bottom: black 1pt solid">(27,842</td> <td style="text-align: left; padding-bottom: 1pt">)</td> <td style="padding-bottom: 1pt"> </td> <td style="text-align: left; border-bottom: black 1pt solid"> </td> <td style="text-align: right; border-bottom: black 1pt solid">(120,813</td> <td style="text-align: left; padding-bottom: 1pt">)</td></tr> <tr style="vertical-align: bottom; background-color: rgb(204, 238, 255)"> <td style="text-align: left; padding-bottom: 2.5pt; padding-left: 5.4pt">Convertible notes payable, net</td> <td style="padding-bottom: 2.5pt"> </td> <td style="text-align: left; border-bottom: black 2.5pt double">$</td> <td style="text-align: right; border-bottom: black 2.5pt double">90,514</td> <td style="text-align: left; padding-bottom: 2.5pt"> </td> <td style="padding-bottom: 2.5pt"> </td> <td style="text-align: left; border-bottom: black 2.5pt double">$</td> <td style="text-align: right; border-bottom: black 2.5pt double">129,187</td> <td style="text-align: left; padding-bottom: 2.5pt"> </td></tr> </table>

NOTE 4 – RELATED PARTY TRANSACTIONS   From time to time, the Company receives advances from the Company’s chief executive officer for working capital purposes.  The advances are non-interest bearing and are payable on demand. For the six months ended June 30, 2016 and 2015, due to related party activity consisted of the following:   <table cellspacing="0" cellpadding="0" style="font: 10pt/normal Times New Roman, Times, Serif; width: 100%; border-collapse: collapse; font-size-adjust: none; font-stretch: normal"> <tr style="vertical-align: bottom"> <td style="text-align: justify"> </td> <td style="line-height: normal; padding-bottom: 1pt; font-size-adjust: none; font-stretch: normal"> </td> <td colspan="3" style="line-height: normal; text-align: center; border-bottom: black 1pt solid; font-size-adjust: none; font-stretch: normal">Six Months ended   June 30, 2016</td> <td style="line-height: normal; padding-bottom: 1pt; font-size-adjust: none; font-stretch: normal"> </td> <td colspan="3" style="line-height: normal; text-align: center; border-bottom: black 1pt solid; font-size-adjust: none; font-stretch: normal">Six Months ended   June 30, 2015</td></tr> <tr style="vertical-align: bottom; background-color: rgb(204, 238, 255)"> <td style="line-height: normal; width: 58%; text-align: justify; padding-left: 5.4pt; font-size-adjust: none; font-stretch: normal">Balance due to related party at beginning of period</td> <td style="line-height: normal; width: 8%; font-size-adjust: none; font-stretch: normal"> </td> <td style="line-height: normal; width: 1%; text-align: left; font-size-adjust: none; font-stretch: normal">$</td> <td style="line-height: normal; width: 11%; text-align: right; font-size-adjust: none; font-stretch: normal">38,434</td> <td style="line-height: normal; width: 1%; text-align: left; font-size-adjust: none; font-stretch: normal"> </td> <td style="line-height: normal; width: 8%; font-size-adjust: none; font-stretch: normal"> </td> <td style="line-height: normal; width: 1%; text-align: left; font-size-adjust: none; font-stretch: normal">$</td> <td style="line-height: normal; width: 11%; text-align: right; font-size-adjust: none; font-stretch: normal">8,051</td> <td style="line-height: normal; width: 1%; text-align: left; font-size-adjust: none; font-stretch: normal"> </td></tr> <tr style="vertical-align: bottom; background-color: white"> <td style="line-height: normal; text-align: left; padding-left: 5.4pt; font-size-adjust: none; font-stretch: normal">Working capital advances received</td> <td style="line-height: normal; font-size-adjust: none; font-stretch: normal"> </td> <td style="line-height: normal; text-align: left; font-size-adjust: none; font-stretch: normal"> </td> <td style="line-height: normal; text-align: right; font-size-adjust: none; font-stretch: normal">—  </td> <td style="line-height: normal; text-align: left; font-size-adjust: none; font-stretch: normal"> </td> <td style="line-height: normal; font-size-adjust: none; font-stretch: normal"> </td> <td style="line-height: normal; text-align: left; font-size-adjust: none; font-stretch: normal"> </td> <td style="line-height: normal; text-align: right; font-size-adjust: none; font-stretch: normal">800</td> <td style="line-height: normal; text-align: left; font-size-adjust: none; font-stretch: normal"> </td></tr> <tr style="vertical-align: bottom; background-color: rgb(204, 238, 255)"> <td style="line-height: normal; text-align: left; padding-bottom: 1pt; padding-left: 5.4pt; font-size-adjust: none; font-stretch: normal">Repayments made and conversions</td> <td style="line-height: normal; padding-bottom: 1pt; font-size-adjust: none; font-stretch: normal"> </td> <td style="line-height: normal; text-align: left; border-bottom: black 1pt solid; font-size-adjust: none; font-stretch: normal"> </td> <td style="line-height: normal; text-align: right; border-bottom: black 1pt solid; font-size-adjust: none; font-stretch: normal">(35,879</td> <td style="line-height: normal; text-align: left; padding-bottom: 1pt; font-size-adjust: none; font-stretch: normal">)</td> <td style="line-height: normal; padding-bottom: 1pt; font-size-adjust: none; font-stretch: normal"> </td> <td style="line-height: normal; text-align: left; border-bottom: black 1pt solid; font-size-adjust: none; font-stretch: normal"> </td> <td style="line-height: normal; text-align: right; border-bottom: black 1pt solid; font-size-adjust: none; font-stretch: normal">(983</td> <td style="line-height: normal; text-align: left; padding-bottom: 1pt; font-size-adjust: none; font-stretch: normal">)</td></tr> <tr style="vertical-align: bottom; background-color: white"> <td style="line-height: normal; text-align: justify; padding-bottom: 2.5pt; padding-left: 5.4pt; font-size-adjust: none; font-stretch: normal">Balance due to related party at end of period</td> <td style="line-height: normal; padding-bottom: 2.5pt; font-size-adjust: none; font-stretch: normal"> </td> <td style="line-height: normal; text-align: left; border-bottom: black 2.5pt double; font-size-adjust: none; font-stretch: normal">$</td> <td style="line-height: normal; text-align: right; border-bottom: black 2.5pt double; font-size-adjust: none; font-stretch: normal">2,555</td> <td style="line-height: normal; text-align: left; padding-bottom: 2.5pt; font-size-adjust: none; font-stretch: normal"> </td> <td style="line-height: normal; padding-bottom: 2.5pt; font-size-adjust: none; font-stretch: normal"> </td> <td style="line-height: normal; text-align: left; border-bottom: black 2.5pt double; font-size-adjust: none; font-stretch: normal">$</td> <td style="line-height: normal; text-align: right; border-bottom: black 2.5pt double; font-size-adjust: none; font-stretch: normal">7,868</td></tr> </table>

NOTE 5 - STOCKHOLDERS’ EQUITY   Preferred stock   The preferred stock may be issued in one or more series. The Company’s board of directors are authorized to issue the shares of preferred stock in such series and to fix from time to time before issuance thereof the number of shares to be included in any such series and the designation, powers, preferences and relative, participating, optional or other rights, and the qualifications, limitations or restrictions thereof, of such series.   On February 19, 2016, the Board of Directors of the Company authorized and approved to create a new class of voting preferred stock called “Series A Preferred Stock”, consisting of 1,000,000 shares authorized, $.001 par value. The preferred stock is not convertible into any other class or series of stock and has no liquidation preference value. The Series A Preferred Stock was issued to ensure perpetual control of at least 51% is provided to the holder of the Series A Preferred Stock. On all matters to come before the shareholders of the Company, the holders of Series A Preferred shall have that number of votes per share (rounded to the nearest whole share) equal to the product of (x) the number of shares of Series A Preferred held on the record date for the determination of the holders of the shares entitled to vote (the “Record Date”), or, if no record date is established, at the date such vote is taken or any written consent of shareholders is first solicited, and (y) 50. In the event that the votes by the holders of the Series A Preferred Stock do not total at least 51% of the votes of all classes of the Company’s authorized capital stock entitled to vote, then regardless of the provisions of this paragraph, in any such case, the votes cast by a majority of the holders of the Series A Preferred Stock shall be deemed to equal 51% of all votes cast at any meeting of stockholders, or any issue put to the stockholders for voting and the Company may state that any such action approved by at least a majority of the holders of the Series A Preferred Stock was had by majority vote of the holders of all classes of the Company’s capital stock.   On February 19, 2016, the Company issued 1,000,000 shares of Series A Preferred Stock to its chief executive officer. In connection with the issuance of Series A preferred shares, the Company recorded a nominal amount of stock-based compensation of $1,000 since the shares had no economic value, on the date of the issuance of such shares, the Company’s chief executive officer was the majority owner of the Company’s common shares, and the value of such voting rights were not readily and objectively measurable .   Common stock issued for services   On March 16, 2016, pursuant to a consulting agreement, the Company issued 16,667 shares of common stock to a consultant for investor relations services rendered. These shares were valued on the date of grant at $0.90 per share or $15,000 based on the fair value of services performed. In March 2016, in connection with the issuance of these shares, the Company recorded stock-based consulting expense of $15,000.   Additionally, for the six months ended June 30, 2016 and 2015, amortization of prepaid stock-based consulting fees amounted to $117,149 and $36,248, respectively.   Common shares issued in connection with debt addendum   On April 20, 2016 and June 6, 2016, the Company entered into agreements for the addendum of the Convertible Note (see Note 3) which waived all rights to enforce any event of default, which may have been triggered by the Company’s failure to file it reports with the SEC. In connection with these agreements, the Company issued 30,000 and 40,000 shares of common stock, respectively, for an aggregate of 70,000 shares of common stock. These shares were valued on the date of grant at $0.40 per share or $28,000 based on recent sales of the Company’s common stock.   Common stock issued for cash   On February 3, 2016, the Company sold 1,200,000 shares of its common stock at $0.40 per common share for cash of $200,000 and a subscription receivable of $280,000. The subscription receivable of $280,000 was collected in April 2016.

NOTE 6 – COMMITMENTS   International distribution agreement       On February 28, 2014, the Company entered into an International Distribution Agreement (the “International Distribution Agreement”) with its major supplier. Through June 30, 2016, the Company has complied with its minimum purchase commitments. Future minimum purchase amounts under the International Distribution Agreement at December 31, 2015 are as follows:   <table cellspacing="0" cellpadding="0" style="font: 10pt/normal Times New Roman, Times, Serif; width: 100%; border-collapse: collapse; font-size-adjust: none; font-stretch: normal"> <tr style="vertical-align: bottom"> <td colspan="3" style="line-height: normal; text-align: center; border-bottom: black 1pt solid; font-size-adjust: none; font-stretch: normal">Years ending December 31,</td> <td style="line-height: normal; padding-bottom: 1pt; font-size-adjust: none; font-stretch: normal"> </td> <td colspan="3" style="line-height: normal; text-align: center; border-bottom: black 1pt solid; font-size-adjust: none; font-stretch: normal">Amount</td></tr> <tr style="vertical-align: bottom; background-color: rgb(204, 238, 255)"> <td style="line-height: normal; width: 1%; text-align: left; font-size-adjust: none; font-stretch: normal"> </td> <td style="line-height: normal; width: 43%; text-align: center; font-size-adjust: none; font-stretch: normal">2016</td> <td style="line-height: normal; width: 1%; text-align: left; font-size-adjust: none; font-stretch: normal"> </td> <td style="line-height: normal; width: 10%; font-size-adjust: none; font-stretch: normal"> </td> <td style="line-height: normal; width: 1%; text-align: left; font-size-adjust: none; font-stretch: normal">$</td> <td style="line-height: normal; width: 43%; text-align: right; font-size-adjust: none; font-stretch: normal">1,000,000</td> <td style="line-height: normal; width: 1%; text-align: left; font-size-adjust: none; font-stretch: normal"> </td></tr> <tr style="vertical-align: bottom; background-color: white"> <td style="line-height: normal; text-align: left; font-size-adjust: none; font-stretch: normal"> </td> <td style="line-height: normal; text-align: center; font-size-adjust: none; font-stretch: normal">2017</td> <td style="line-height: normal; text-align: left; font-size-adjust: none; font-stretch: normal"> </td> <td style="line-height: normal; font-size-adjust: none; font-stretch: normal"> </td> <td style="line-height: normal; text-align: left; font-size-adjust: none; font-stretch: normal"> </td> <td style="line-height: normal; text-align: right; font-size-adjust: none; font-stretch: normal">1,500,000</td> <td style="line-height: normal; text-align: left; font-size-adjust: none; font-stretch: normal"> </td></tr> <tr style="vertical-align: bottom; background-color: rgb(204, 238, 255)"> <td style="line-height: normal; text-align: left; font-size-adjust: none; font-stretch: normal"> </td> <td style="line-height: normal; text-align: center; font-size-adjust: none; font-stretch: normal">2018</td> <td style="line-height: normal; text-align: left; padding-bottom: 1pt; font-size-adjust: none; font-stretch: normal"> </td> <td style="line-height: normal; padding-bottom: 1pt; font-size-adjust: none; font-stretch: normal"> </td> <td style="line-height: normal; text-align: left; border-bottom: black 1pt solid; font-size-adjust: none; font-stretch: normal"> </td> <td style="line-height: normal; text-align: right; border-bottom: black 1pt solid; font-size-adjust: none; font-stretch: normal">2,500,000</td> <td style="line-height: normal; text-align: left; padding-bottom: 1pt; font-size-adjust: none; font-stretch: normal"> </td></tr> <tr style="vertical-align: bottom; background-color: white"> <td style="line-height: normal; text-align: left; font-size-adjust: none; font-stretch: normal"> </td> <td style="line-height: normal; text-align: left; font-size-adjust: none; font-stretch: normal">Total minimum purchase amounts</td> <td style="line-height: normal; text-align: left; padding-bottom: 2.5pt; font-size-adjust: none; font-stretch: normal"> </td> <td style="line-height: normal; padding-bottom: 2.5pt; font-size-adjust: none; font-stretch: normal"> </td> <td style="line-height: normal; text-align: left; border-bottom: black 2.5pt double; font-size-adjust: none; font-stretch: normal">$</td> <td style="line-height: normal; text-align: right; border-bottom: black 2.5pt double; font-size-adjust: none; font-stretch: normal">5,000,000</td> <td style="line-height: normal; text-align: left; padding-bottom: 2.5pt; font-size-adjust: none; font-stretch: normal"> </td></tr> </table>

NOTE 7 – CONCENTRATIONS   Concentrations of credit risk   Financial instruments that potentially subject the Company to concentrations of credit risk consist primarily of and cash deposits. The Company places its cash in banks at levels that, at times, may exceed federally insured limits. There were no balances in excess of FDIC insured levels as of June 30, 2016 and December 31, 2015. The Company has not experienced any losses in such accounts through June 30, 2016.   Geographic concentrations of sales   For the six months ended June 30, 2016 and 2015, substantially all of the Company’s revenues was to customers located outside the United States. No other geographical area accounted for more than 10% of total sales during the six months ended June 30, 2016 and 2015.   Customer concentrations   For the six months ended June 30, 2016, three customers accounted for approximately 46.2% of total sales (10.2%, 10.5% and 25.5%, respectively). For the six months ended June 30, 2015, five customers accounted for approximately 88.9% of total sales (22.9%, 14.3%, 23.0%, 13.8% and 14.9%, respectively). A reduction in sales from or loss of such customers would have a material adverse effect on the Company’s consolidated results of operations and financial condition.     Vendor concentrations   For the six months ended June 30, 2016 and 2015, the Company purchased all of its products from one supplier. The loss of this supplier may have a material adverse effect on the Company’s consolidated results of operations and financial condition.

NOTE 8 – RESTATEMENT OF 2015 PERIODS   The Company’s unaudited consolidated financial statements have been restated for the three and six months ended June 30, 2015 to properly reflect certain transactions for revenues, costs of revenues and operating expenses in the proper period. The effect of correcting these errors in the Company’s unaudited consolidated financial statements for the three and six months ended June 30, 2015 are shown in the table as follows:   <table cellspacing="0" cellpadding="0" style="font: 10pt/normal Times New Roman, Times, Serif; width: 100%; border-collapse: collapse; font-size-adjust: none; font-stretch: normal"> <tr style="vertical-align: bottom"> <td style="line-height: normal; border-bottom: black 1pt solid; font-size-adjust: none; font-stretch: normal">Consolidated Statement of operations</td> <td style="line-height: normal; padding-bottom: 1pt; font-size-adjust: none; font-stretch: normal"> </td> <td colspan="11" style="line-height: normal; text-align: center; border-bottom: black 1pt solid; font-size-adjust: none; font-stretch: normal">For the Six Months Ended June 30, 2015 (Unaudited)</td></tr> <tr style="vertical-align: bottom"> <td> </td> <td style="line-height: normal; padding-bottom: 1pt; font-size-adjust: none; font-stretch: normal"> </td> <td colspan="3" style="line-height: normal; text-align: center; border-bottom: black 1pt solid; font-size-adjust: none; font-stretch: normal">As previously reported</td> <td style="line-height: normal; padding-bottom: 1pt; font-size-adjust: none; font-stretch: normal"> </td> <td colspan="3" style="line-height: normal; text-align: center; border-bottom: black 1pt solid; font-size-adjust: none; font-stretch: normal">Adjustments to Restate</td> <td style="line-height: normal; padding-bottom: 1pt; font-size-adjust: none; font-stretch: normal"> </td> <td colspan="3" style="line-height: normal; text-align: center; border-bottom: black 1pt solid; font-size-adjust: none; font-stretch: normal">As Restated</td></tr> <tr style="vertical-align: bottom; background-color: rgb(204, 238, 255)"> <td style="line-height: normal; width: 46%; font-size-adjust: none; font-stretch: normal">Revenues</td> <td style="line-height: normal; width: 5%; font-size-adjust: none; font-stretch: normal"> </td> <td style="line-height: normal; width: 1%; text-align: left; font-size-adjust: none; font-stretch: normal">$</td> <td style="line-height: normal; width: 11%; text-align: right; font-size-adjust: none; font-stretch: normal">1,341,890</td> <td style="line-height: normal; width: 1%; text-align: left; font-size-adjust: none; font-stretch: normal"> </td> <td style="line-height: normal; width: 5%; font-size-adjust: none; font-stretch: normal"> </td> <td style="line-height: normal; width: 1%; text-align: left; font-size-adjust: none; font-stretch: normal">$</td> <td style="line-height: normal; width: 11%; text-align: right; font-size-adjust: none; font-stretch: normal">7,200</td> <td style="line-height: normal; width: 1%; text-align: left; font-size-adjust: none; font-stretch: normal"> </td> <td style="line-height: normal; width: 5%; font-size-adjust: none; font-stretch: normal"> </td> <td style="line-height: normal; width: 1%; text-align: left; font-size-adjust: none; font-stretch: normal">$</td> <td style="line-height: normal; width: 11%; text-align: right; font-size-adjust: none; font-stretch: normal">1,349,090</td> <td style="line-height: normal; width: 1%; text-align: left; font-size-adjust: none; font-stretch: normal"> </td></tr> <tr style="vertical-align: bottom; background-color: white"> <td style="line-height: normal; padding-bottom: 1pt; font-size-adjust: none; font-stretch: normal">Cost of revenues</td> <td style="line-height: normal; padding-bottom: 1pt; font-size-adjust: none; font-stretch: normal"> </td> <td style="line-height: normal; text-align: left; border-bottom: black 1pt solid; font-size-adjust: none; font-stretch: normal"> </td> <td style="line-height: normal; text-align: right; border-bottom: black 1pt solid; font-size-adjust: none; font-stretch: normal">1,185,340</td> <td style="line-height: normal; text-align: left; padding-bottom: 1pt; font-size-adjust: none; font-stretch: normal"> </td> <td style="line-height: normal; padding-bottom: 1pt; font-size-adjust: none; font-stretch: normal"> </td> <td style="line-height: normal; text-align: left; border-bottom: black 1pt solid; font-size-adjust: none; font-stretch: normal"> </td> <td style="line-height: normal; text-align: right; border-bottom: black 1pt solid; font-size-adjust: none; font-stretch: normal">57,564</td> <td style="line-height: normal; text-align: left; padding-bottom: 1pt; font-size-adjust: none; font-stretch: normal"> </td> <td style="line-height: normal; padding-bottom: 1pt; font-size-adjust: none; font-stretch: normal"> </td> <td style="line-height: normal; text-align: left; border-bottom: black 1pt solid; font-size-adjust: none; font-stretch: normal"> </td> <td style="line-height: normal; text-align: right; border-bottom: black 1pt solid; font-size-adjust: none; font-stretch: normal">1,242,904</td> <td style="line-height: normal; text-align: left; padding-bottom: 1pt; font-size-adjust: none; font-stretch: normal"> </td></tr> <tr style="vertical-align: bottom; background-color: rgb(204, 238, 255)"> <td style="line-height: normal; text-align: left; font-size-adjust: none; font-stretch: normal">Gross profit</td> <td style="line-height: normal; font-size-adjust: none; font-stretch: normal"> </td> <td style="line-height: normal; text-align: left; font-size-adjust: none; font-stretch: normal"> </td> <td style="line-height: normal; text-align: right; font-size-adjust: none; font-stretch: normal">156,550</td> <td style="line-height: normal; text-align: left; font-size-adjust: none; font-stretch: normal"> </td> <td style="line-height: normal; font-size-adjust: none; font-stretch: normal"> </td> <td style="line-height: normal; text-align: left; font-size-adjust: none; font-stretch: normal"> </td> <td style="line-height: normal; text-align: right; font-size-adjust: none; font-stretch: normal">(50,364</td> <td style="line-height: normal; text-align: left; font-size-adjust: none; font-stretch: normal">)</td> <td style="line-height: normal; font-size-adjust: none; font-stretch: normal"> </td> <td style="line-height: normal; text-align: left; font-size-adjust: none; font-stretch: normal"> </td> <td style="line-height: normal; text-align: right; font-size-adjust: none; font-stretch: normal">106,186</td> <td style="line-height: normal; text-align: left; font-size-adjust: none; font-stretch: normal"> </td></tr> <tr style="vertical-align: bottom; background-color: white"> <td style="line-height: normal; text-align: left; padding-bottom: 1pt; font-size-adjust: none; font-stretch: normal">Operating expenses</td> <td style="line-height: normal; padding-bottom: 1pt; font-size-adjust: none; font-stretch: normal"> </td> <td style="line-height: normal; text-align: left; border-bottom: black 1pt solid; font-size-adjust: none; font-stretch: normal"> </td> <td style="line-height: normal; text-align: right; border-bottom: black 1pt solid; font-size-adjust: none; font-stretch: normal">217,711</td> <td style="line-height: normal; text-align: left; padding-bottom: 1pt; font-size-adjust: none; font-stretch: normal"> </td> <td style="line-height: normal; padding-bottom: 1pt; font-size-adjust: none; font-stretch: normal"> </td> <td style="line-height: normal; text-align: left; border-bottom: black 1pt solid; font-size-adjust: none; font-stretch: normal"> </td> <td style="line-height: normal; text-align: right; border-bottom: black 1pt solid; font-size-adjust: none; font-stretch: normal">(22,347</td> <td style="line-height: normal; text-align: left; padding-bottom: 1pt; font-size-adjust: none; font-stretch: normal">)</td> <td style="line-height: normal; padding-bottom: 1pt; font-size-adjust: none; font-stretch: normal"> </td> <td style="line-height: normal; text-align: left; border-bottom: black 1pt solid; font-size-adjust: none; font-stretch: normal"> </td> <td style="line-height: normal; text-align: right; border-bottom: black 1pt solid; font-size-adjust: none; font-stretch: normal">195,364</td> <td style="line-height: normal; text-align: left; padding-bottom: 1pt; font-size-adjust: none; font-stretch: normal"> </td></tr> <tr style="vertical-align: bottom; background-color: rgb(204, 238, 255)"> <td style="line-height: normal; text-align: left; padding-bottom: 1pt; font-size-adjust: none; font-stretch: normal">Loss from operations</td> <td style="line-height: normal; padding-bottom: 1pt; font-size-adjust: none; font-stretch: normal"> </td> <td style="line-height: normal; text-align: left; border-bottom: black 1pt solid; font-size-adjust: none; font-stretch: normal"> </td> <td style="line-height: normal; text-align: right; border-bottom: black 1pt solid; font-size-adjust: none; font-stretch: normal">(61,161</td> <td style="line-height: normal; text-align: left; padding-bottom: 1pt; font-size-adjust: none; font-stretch: normal">)</td> <td style="line-height: normal; padding-bottom: 1pt; font-size-adjust: none; font-stretch: normal"> </td> <td style="line-height: normal; text-align: left; border-bottom: black 1pt solid; font-size-adjust: none; font-stretch: normal"> </td> <td style="line-height: normal; text-align: right; border-bottom: black 1pt solid; font-size-adjust: none; font-stretch: normal">(28,017</td> <td style="line-height: normal; text-align: left; padding-bottom: 1pt; font-size-adjust: none; font-stretch: normal">)</td> <td style="line-height: normal; padding-bottom: 1pt; font-size-adjust: none; font-stretch: normal"> </td> <td style="line-height: normal; text-align: left; border-bottom: black 1pt solid; font-size-adjust: none; font-stretch: normal"> </td> <td style="line-height: normal; text-align: right; border-bottom: black 1pt solid; font-size-adjust: none; font-stretch: normal">(89,178</td> <td style="line-height: normal; text-align: left; padding-bottom: 1pt; font-size-adjust: none; font-stretch: normal">)</td></tr> <tr style="vertical-align: bottom; background-color: white"> <td style="line-height: normal; text-align: left; padding-bottom: 2.5pt; font-size-adjust: none; font-stretch: normal">Other expenses</td> <td style="line-height: normal; padding-bottom: 2.5pt; font-size-adjust: none; font-stretch: normal"> </td> <td style="line-height: normal; text-align: left; border-bottom: black 2.5pt double; font-size-adjust: none; font-stretch: normal"> </td> <td style="line-height: normal; text-align: right; border-bottom: black 2.5pt double; font-size-adjust: none; font-stretch: normal">—  </td> <td style="line-height: normal; text-align: left; padding-bottom: 2.5pt; font-size-adjust: none; font-stretch: normal"> </td> <td style="line-height: normal; padding-bottom: 2.5pt; font-size-adjust: none; font-stretch: normal"> </td> <td style="line-height: normal; text-align: left; border-bottom: black 2.5pt double; font-size-adjust: none; font-stretch: normal"> </td> <td style="line-height: normal; text-align: right; border-bottom: black 2.5pt double; font-size-adjust: none; font-stretch: normal">(47</td> <td style="line-height: normal; text-align: left; padding-bottom: 2.5pt; font-size-adjust: none; font-stretch: normal">)</td> <td style="line-height: normal; padding-bottom: 2.5pt; font-size-adjust: none; font-stretch: normal"> </td> <td style="line-height: normal; text-align: left; border-bottom: black 2.5pt double; font-size-adjust: none; font-stretch: normal"> </td> <td style="line-height: normal; text-align: right; border-bottom: black 2.5pt double; font-size-adjust: none; font-stretch: normal">(47</td> <td style="line-height: normal; text-align: left; padding-bottom: 2.5pt; font-size-adjust: none; font-stretch: normal">)</td></tr> <tr style="vertical-align: bottom; background-color: rgb(204, 238, 255)"> <td style="line-height: normal; text-align: left; padding-bottom: 2.5pt; font-size-adjust: none; font-stretch: normal">Net loss</td> <td style="line-height: normal; padding-bottom: 2.5pt; font-size-adjust: none; font-stretch: normal"> </td> <td style="line-height: normal; text-align: left; border-bottom: black 2.5pt double; font-size-adjust: none; font-stretch: normal">$</td> <td style="line-height: normal; text-align: right; border-bottom: black 2.5pt double; font-size-adjust: none; font-stretch: normal">(61,161</td> <td style="line-height: normal; text-align: left; padding-bottom: 2.5pt; font-size-adjust: none; font-stretch: normal">)</td> <td style="line-height: normal; padding-bottom: 2.5pt; font-size-adjust: none; font-stretch: normal"> </td> <td style="line-height: normal; text-align: left; border-bottom: black 2.5pt double; font-size-adjust: none; font-stretch: normal">$</td> <td style="line-height: normal; text-align: right; border-bottom: black 2.5pt double; font-size-adjust: none; font-stretch: normal">(28,064</td> <td style="line-height: normal; text-align: left; padding-bottom: 2.5pt; font-size-adjust: none; font-stretch: normal">)</td> <td style="line-height: normal; padding-bottom: 2.5pt; font-size-adjust: none; font-stretch: normal"> </td> <td style="line-height: normal; text-align: left; border-bottom: black 2.5pt double; font-size-adjust: none; font-stretch: normal">$</td> <td style="line-height: normal; text-align: right; border-bottom: black 2.5pt double; font-size-adjust: none; font-stretch: normal">(89,225</td> <td style="line-height: normal; text-align: left; padding-bottom: 2.5pt; font-size-adjust: none; font-stretch: normal">)</td></tr> <tr style="vertical-align: bottom; background-color: white"> <td style="line-height: normal; padding-bottom: 2.5pt; font-size-adjust: none; font-stretch: normal">Net loss per common share</td> <td style="line-height: normal; padding-bottom: 2.5pt; font-size-adjust: none; font-stretch: normal"> </td> <td style="line-height: normal; text-align: left; border-bottom: black 2.5pt double; font-size-adjust: none; font-stretch: normal">$</td> <td style="line-height: normal; text-align: right; border-bottom: black 2.5pt double; font-size-adjust: none; font-stretch: normal">(0.00</td> <td style="line-height: normal; text-align: left; padding-bottom: 2.5pt; font-size-adjust: none; font-stretch: normal">)</td> <td style="line-height: normal; padding-bottom: 2.5pt; font-size-adjust: none; font-stretch: normal"> </td> <td style="line-height: normal; text-align: left; border-bottom: black 2.5pt double; font-size-adjust: none; font-stretch: normal">$</td> <td style="line-height: normal; text-align: right; border-bottom: black 2.5pt double; font-size-adjust: none; font-stretch: normal">(0.00</td> <td style="line-height: normal; text-align: left; padding-bottom: 2.5pt; font-size-adjust: none; font-stretch: normal">)</td> <td style="line-height: normal; padding-bottom: 2.5pt; font-size-adjust: none; font-stretch: normal"> </td> <td style="line-height: normal; text-align: left; border-bottom: black 2.5pt double; font-size-adjust: none; font-stretch: normal">$</td> <td style="line-height: normal; text-align: right; border-bottom: black 2.5pt double; font-size-adjust: none; font-stretch: normal">(0.01</td> <td style="line-height: normal; text-align: left; padding-bottom: 2.5pt; font-size-adjust: none; font-stretch: normal">)</td></tr> </table>   <table cellspacing="0" cellpadding="0" style="font: 10pt/normal Times New Roman, Times, Serif; width: 100%; border-collapse: collapse; font-size-adjust: none; font-stretch: normal"> <tr style="vertical-align: bottom"> <td style="line-height: normal; border-bottom: black 1pt solid; font-size-adjust: none; font-stretch: normal">Consolidated Statement of operations</td> <td style="line-height: normal; padding-bottom: 1pt; font-size-adjust: none; font-stretch: normal"> </td> <td colspan="11" style="line-height: normal; text-align: center; border-bottom: black 1pt solid; font-size-adjust: none; font-stretch: normal">For the Three Months Ended June 30, 2015 (Unaudited)</td></tr> <tr style="vertical-align: bottom"> <td> </td> <td style="line-height: normal; padding-bottom: 1pt; font-size-adjust: none; font-stretch: normal"> </td> <td colspan="3" style="line-height: normal; text-align: center; border-bottom: black 1pt solid; font-size-adjust: none; font-stretch: normal">As previously reported</td> <td style="line-height: normal; padding-bottom: 1pt; font-size-adjust: none; font-stretch: normal"> </td> <td colspan="3" style="line-height: normal; text-align: center; border-bottom: black 1pt solid; font-size-adjust: none; font-stretch: normal">Adjustments to Restate</td> <td style="line-height: normal; padding-bottom: 1pt; font-size-adjust: none; font-stretch: normal"> </td> <td colspan="3" style="line-height: normal; text-align: center; border-bottom: black 1pt solid; font-size-adjust: none; font-stretch: normal">As Restated</td></tr> <tr style="vertical-align: bottom; background-color: rgb(204, 238, 255)"> <td style="line-height: normal; width: 46%; font-size-adjust: none; font-stretch: normal">Revenues</td> <td style="line-height: normal; width: 5%; font-size-adjust: none; font-stretch: normal"> </td> <td style="line-height: normal; width: 1%; text-align: left; font-size-adjust: none; font-stretch: normal">$</td> <td style="line-height: normal; width: 11%; text-align: right; font-size-adjust: none; font-stretch: normal">557,348</td> <td style="line-height: normal; width: 1%; text-align: left; font-size-adjust: none; font-stretch: normal"> </td> <td style="line-height: normal; width: 5%; font-size-adjust: none; font-stretch: normal"> </td> <td style="line-height: normal; width: 1%; text-align: left; font-size-adjust: none; font-stretch: normal">$</td> <td style="line-height: normal; width: 11%; text-align: right; font-size-adjust: none; font-stretch: normal">17,248</td> <td style="line-height: normal; width: 1%; text-align: left; font-size-adjust: none; font-stretch: normal"> </td> <td style="line-height: normal; width: 5%; font-size-adjust: none; font-stretch: normal"> </td> <td style="line-height: normal; width: 1%; text-align: left; font-size-adjust: none; font-stretch: normal">$</td> <td style="line-height: normal; width: 11%; text-align: right; font-size-adjust: none; font-stretch: normal">574,596</td> <td style="line-height: normal; width: 1%; text-align: left; font-size-adjust: none; font-stretch: normal"> </td></tr> <tr style="vertical-align: bottom; background-color: white"> <td style="line-height: normal; padding-bottom: 1pt; font-size-adjust: none; font-stretch: normal">Cost of revenues</td> <td style="line-height: normal; padding-bottom: 1pt; font-size-adjust: none; font-stretch: normal"> </td> <td style="line-height: normal; text-align: left; border-bottom: black 1pt solid; font-size-adjust: none; font-stretch: normal"> </td> <td style="line-height: normal; text-align: right; border-bottom: black 1pt solid; font-size-adjust: none; font-stretch: normal">469,489</td> <td style="line-height: normal; text-align: left; padding-bottom: 1pt; font-size-adjust: none; font-stretch: normal"> </td> <td style="line-height: normal; padding-bottom: 1pt; font-size-adjust: none; font-stretch: normal"> </td> <td style="line-height: normal; text-align: left; border-bottom: black 1pt solid; font-size-adjust: none; font-stretch: normal"> </td> <td style="line-height: normal; text-align: right; border-bottom: black 1pt solid; font-size-adjust: none; font-stretch: normal">18,886</td> <td style="line-height: normal; text-align: left; padding-bottom: 1pt; font-size-adjust: none; font-stretch: normal"> </td> <td style="line-height: normal; padding-bottom: 1pt; font-size-adjust: none; font-stretch: normal"> </td> <td style="line-height: normal; text-align: left; border-bottom: black 1pt solid; font-size-adjust: none; font-stretch: normal"> </td> <td style="line-height: normal; text-align: right; border-bottom: black 1pt solid; font-size-adjust: none; font-stretch: normal">488,375</td> <td style="line-height: normal; text-align: left; padding-bottom: 1pt; font-size-adjust: none; font-stretch: normal"> </td></tr> <tr style="vertical-align: bottom; background-color: rgb(204, 238, 255)"> <td style="line-height: normal; text-align: left; font-size-adjust: none; font-stretch: normal">Gross profit</td> <td style="line-height: normal; font-size-adjust: none; font-stretch: normal"> </td> <td style="line-height: normal; text-align: left; font-size-adjust: none; font-stretch: normal"> </td> <td style="line-height: normal; text-align: right; font-size-adjust: none; font-stretch: normal">87,859</td> <td style="line-height: normal; text-align: left; font-size-adjust: none; font-stretch: normal"> </td> <td style="line-height: normal; font-size-adjust: none; font-stretch: normal"> </td> <td style="line-height: normal; text-align: left; font-size-adjust: none; font-stretch: normal"> </td> <td style="line-height: normal; text-align: right; font-size-adjust: none; font-stretch: normal">(1,638</td> <td style="line-height: normal; text-align: left; font-size-adjust: none; font-stretch: normal">)</td> <td style="line-height: normal; font-size-adjust: none; font-stretch: normal"> </td> <td style="line-height: normal; text-align: left; font-size-adjust: none; font-stretch: normal"> </td> <td style="line-height: normal; text-align: right; font-size-adjust: none; font-stretch: normal">86,221</td> <td style="line-height: normal; text-align: left; font-size-adjust: none; font-stretch: normal"> </td></tr> <tr style="vertical-align: bottom; background-color: white"> <td style="line-height: normal; text-align: left; padding-bottom: 1pt; font-size-adjust: none; font-stretch: normal">Operating expenses</td> <td style="line-height: normal; padding-bottom: 1pt; font-size-adjust: none; font-stretch: normal"> </td> <td style="line-height: normal; text-align: left; border-bottom: black 1pt solid; font-size-adjust: none; font-stretch: normal"> </td> <td style="line-height: normal; text-align: right; border-bottom: black 1pt solid; font-size-adjust: none; font-stretch: normal">105,600</td> <td style="line-height: normal; text-align: left; padding-bottom: 1pt; font-size-adjust: none; font-stretch: normal"> </td> <td style="line-height: normal; padding-bottom: 1pt; font-size-adjust: none; font-stretch: normal"> </td> <td style="line-height: normal; text-align: left; border-bottom: black 1pt solid; font-size-adjust: none; font-stretch: normal"> </td> <td style="line-height: normal; text-align: right; border-bottom: black 1pt solid; font-size-adjust: none; font-stretch: normal">(9,505</td> <td style="line-height: normal; text-align: left; padding-bottom: 1pt; font-size-adjust: none; font-stretch: normal">)</td> <td style="line-height: normal; padding-bottom: 1pt; font-size-adjust: none; font-stretch: normal"> </td> <td style="line-height: normal; text-align: left; border-bottom: black 1pt solid; font-size-adjust: none; font-stretch: normal"> </td> <td style="line-height: normal; text-align: right; border-bottom: black 1pt solid; font-size-adjust: none; font-stretch: normal">96,095</td> <td style="line-height: normal; text-align: left; padding-bottom: 1pt; font-size-adjust: none; font-stretch: normal"> </td></tr> <tr style="vertical-align: bottom; background-color: rgb(204, 238, 255)"> <td style="line-height: normal; text-align: left; padding-bottom: 1pt; font-size-adjust: none; font-stretch: normal">Loss from operations</td> <td style="line-height: normal; padding-bottom: 1pt; font-size-adjust: none; font-stretch: normal"> </td> <td style="line-height: normal; text-align: left; border-bottom: black 1pt solid; font-size-adjust: none; font-stretch: normal"> </td> <td style="line-height: normal; text-align: right; border-bottom: black 1pt solid; font-size-adjust: none; font-stretch: normal">(17,741</td> <td style="line-height: normal; text-align: left; padding-bottom: 1pt; font-size-adjust: none; font-stretch: normal">)</td> <td style="line-height: normal; padding-bottom: 1pt; font-size-adjust: none; font-stretch: normal"> </td> <td style="line-height: normal; text-align: left; border-bottom: black 1pt solid; font-size-adjust: none; font-stretch: normal"> </td> <td style="line-height: normal; text-align: right; border-bottom: black 1pt solid; font-size-adjust: none; font-stretch: normal">7,867</td> <td style="line-height: normal; text-align: left; padding-bottom: 1pt; font-size-adjust: none; font-stretch: normal"> </td> <td style="line-height: normal; padding-bottom: 1pt; font-size-adjust: none; font-stretch: normal"> </td> <td style="line-height: normal; text-align: left; border-bottom: black 1pt solid; font-size-adjust: none; font-stretch: normal"> </td> <td style="line-height: normal; text-align: right; border-bottom: black 1pt solid; font-size-adjust: none; font-stretch: normal">(9,874</td> <td style="line-height: normal; text-align: left; padding-bottom: 1pt; font-size-adjust: none; font-stretch: normal">)</td></tr> <tr style="vertical-align: bottom; background-color: white"> <td style="line-height: normal; text-align: left; padding-bottom: 2.5pt; font-size-adjust: none; font-stretch: normal">Other expenses</td> <td style="line-height: normal; padding-bottom: 2.5pt; font-size-adjust: none; font-stretch: normal"> </td> <td style="line-height: normal; text-align: left; border-bottom: black 2.5pt double; font-size-adjust: none; font-stretch: normal"> </td> <td style="line-height: normal; text-align: right; border-bottom: black 2.5pt double; font-size-adjust: none; font-stretch: normal">—  </td> <td style="line-height: normal; text-align: left; padding-bottom: 2.5pt; font-size-adjust: none; font-stretch: normal"> </td> <td style="line-height: normal; padding-bottom: 2.5pt; font-size-adjust: none; font-stretch: normal"> </td> <td style="line-height: normal; text-align: left; border-bottom: black 2.5pt double; font-size-adjust: none; font-stretch: normal"> </td> <td style="line-height: normal; text-align: right; border-bottom: black 2.5pt double; font-size-adjust: none; font-stretch: normal">(47</td> <td style="line-height: normal; text-align: left; padding-bottom: 2.5pt; font-size-adjust: none; font-stretch: normal">)</td> <td style="line-height: normal; padding-bottom: 2.5pt; font-size-adjust: none; font-stretch: normal"> </td> <td style="line-height: normal; text-align: left; border-bottom: black 2.5pt double; font-size-adjust: none; font-stretch: normal"> </td> <td style="line-height: normal; text-align: right; border-bottom: black 2.5pt double; font-size-adjust: none; font-stretch: normal">(47</td> <td style="line-height: normal; text-align: left; padding-bottom: 2.5pt; font-size-adjust: none; font-stretch: normal">)</td></tr> <tr style="vertical-align: bottom; background-color: rgb(204, 238, 255)"> <td style="line-height: normal; text-align: left; padding-bottom: 2.5pt; font-size-adjust: none; font-stretch: normal">Net loss</td> <td style="line-height: normal; padding-bottom: 2.5pt; font-size-adjust: none; font-stretch: normal"> </td> <td style="line-height: normal; text-align: left; border-bottom: black 2.5pt double; font-size-adjust: none; font-stretch: normal">$</td> <td style="line-height: normal; text-align: right; border-bottom: black 2.5pt double; font-size-adjust: none; font-stretch: normal">(17,741</td> <td style="line-height: normal; text-align: left; padding-bottom: 2.5pt; font-size-adjust: none; font-stretch: normal">)</td> <td style="line-height: normal; padding-bottom: 2.5pt; font-size-adjust: none; font-stretch: normal"> </td> <td style="line-height: normal; text-align: left; border-bottom: black 2.5pt double; font-size-adjust: none; font-stretch: normal">$</td> <td style="line-height: normal; text-align: right; border-bottom: black 2.5pt double; font-size-adjust: none; font-stretch: normal">7,820</td> <td style="line-height: normal; text-align: left; padding-bottom: 2.5pt; font-size-adjust: none; font-stretch: normal"> </td> <td style="line-height: normal; padding-bottom: 2.5pt; font-size-adjust: none; font-stretch: normal"> </td> <td style="line-height: normal; text-align: left; border-bottom: black 2.5pt double; font-size-adjust: none; font-stretch: normal">$</td> <td style="line-height: normal; text-align: right; border-bottom: black 2.5pt double; font-size-adjust: none; font-stretch: normal">(9,921</td> <td style="line-height: normal; text-align: left; padding-bottom: 2.5pt; font-size-adjust: none; font-stretch: normal">)</td></tr> <tr style="vertical-align: bottom; background-color: white"> <td style="line-height: normal; padding-bottom: 2.5pt; font-size-adjust: none; font-stretch: normal">Net loss per common share</td> <td style="line-height: normal; padding-bottom: 2.5pt; font-size-adjust: none; font-stretch: normal"> </td> <td style="line-height: normal; text-align: left; border-bottom: black 2.5pt double; font-size-adjust: none; font-stretch: normal">$</td> <td style="line-height: normal; text-align: right; border-bottom: black 2.5pt double; font-size-adjust: none; font-stretch: normal">(0.00</td> <td style="line-height: normal; text-align: left; padding-bottom: 2.5pt; font-size-adjust: none; font-stretch: normal">)</td> <td style="line-height: normal; padding-bottom: 2.5pt; font-size-adjust: none; font-stretch: normal"> </td> <td style="line-height: normal; text-align: left; border-bottom: black 2.5pt double; font-size-adjust: none; font-stretch: normal">$</td> <td style="line-height: normal; text-align: right; border-bottom: black 2.5pt double; font-size-adjust: none; font-stretch: normal">(0.00</td> <td style="line-height: normal; text-align: left; padding-bottom: 2.5pt; font-size-adjust: none; font-stretch: normal">)</td> <td style="line-height: normal; padding-bottom: 2.5pt; font-size-adjust: none; font-stretch: normal"> </td> <td style="line-height: normal; text-align: left; border-bottom: black 2.5pt double; font-size-adjust: none; font-stretch: normal">$</td> <td style="line-height: normal; text-align: right; border-bottom: black 2.5pt double; font-size-adjust: none; font-stretch: normal">(0.00</td> <td style="line-height: normal; text-align: left; padding-bottom: 2.5pt; font-size-adjust: none; font-stretch: normal">)</td></tr> </table>

NOTE 9 - SUBSEQUENT EVENTS   On August 26, 2016, the Company entered into an agreement for the addendum of the Convertible Note (see Note 3) which waived all rights to enforce any event of default, which may have been triggered by the Company’s failure to file it reports with the SEC. In connection with this agreement, the Company issued 130,000 shares of common stock and paid a cash penalty of $5,000. These shares were valued on the date of grant at $0.40 per share or $52,000 based on recent sales of the Company’s common stock.

Recent accounting pronouncements   In May 2014, the FASB issued an update ("ASU 2014-09") Revenue from Contracts with Customers.  ASU 2014-09 establishes a single comprehensive model for entities to use in accounting for revenue arising from contracts with customers and supersedes most of the existing revenue recognition guidance.  ASU 2014-09 requires an entity to recognize revenue when it transfers promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services and requires certain additional disclosures.  ASU 2014-09 is effective for interim and annual reporting periods in fiscal years that begin after December 15, 2016.  The Company is currently evaluating the impact of the adoption of ASU 2014-09 on its consolidated financial statements.   In June 2014, the FASB issued an update (“ASU 2014-12”) to ASC Topic 718, Compensation – Stock Compensation.  ASU 2014-12 requires an entity to treat performance targets that can be met after the requisite service period of a share-based award has ended, as a performance condition that affects vesting.  ASU 2014-12 is effective for interim and annual reporting periods in fiscal years that begin after December 15, 2015.  The adoption of ASU 2014-12 did not have a material effect on the Company’s financial position, results of operations and cash flows.   In August 2014, the FASB issued ASU 2014-15, Disclosure of Uncertainties About an Entity’s Ability to Continue as a Going Concern, that will require management to assess an entity’s ability to continue as a going concern, and to provide related footnote disclosures in certain circumstances. In connection with each annual and interim period, management will assess if there is substantial doubt about an entity’s ability to continue as a going concern within one year after the issuance date. Substantial doubt exists if it is probable that the entity will be unable to meet its obligations within one year after the issuance date. The new standard defines substantial doubt and provides example indicators. Disclosures will be required if conditions give rise to substantial doubt. However, management will need to assess if its plans will alleviate substantial doubt to determine the specific disclosures. This standard is effective for public entities for annual periods ending after December 15, 2016. Earlier application of this standard is permitted. This standard is not expected to have a material effect on our financial position, results of operations and cash flows.   In February 2015, the FASB issued ASU 2015-02, Consolidation (Topic 810) (“ASU 2015-02”), to address financial reporting considerations for the evaluation as to the requirement to consolidate certain legal entities. ASU 2015-02 is effective for fiscal years and for interim periods within those fiscal years beginning after December 15, 2015. This standard did not have a material effect on the Company’s financial position, results of operations and cash flows.   In April 2015, the FASB issued ASU 2015-03, Interest—Imputation of Interest (Subtopic 835-30) (“ASU 2015-03”), as part of the initiative to reduce complexity in accounting standards. The update requires that debt issuance costs related to a recognized debt liability be presented in the balance sheet as a direct deduction from the carrying amount of that debt liability, consistent with debt discounts. ASU 2015-03 is effective for annual periods beginning after December 15, 2015 and for interim periods within those fiscal years.   In November 2015, the FASB issued ASU 2015-17, Balance Sheet Classification of Deferred Taxes (“ASU 2015-17”), which requires entities to present deferred tax assets and deferred tax liabilities as noncurrent in a classified balance sheet. The ASU simplifies the current guidance in ASC Topic 740, Income Taxes, which requires entities to separately present deferred tax assets and liabilities as current and noncurrent in a classified balance sheet. ASU 2015-17 is effective for fiscal years beginning after December 15, 2016, and interim periods within those annual periods. Early adoption is permitted for all entities as of the beginning of an interim or annual reporting period. The Company does not expect the impact of ASU 2015-17 to be material to our consolidated financial statements.    There are no other recently issued accounting standards that apply to us or that are expected to have a material impact on our results of operations, financial condition, or cash flows.

Loss per share of common stock   ASC 260 “Earnings Per Share”, requires dual presentation of basic and diluted earnings per share (“EPS”) with a reconciliation of the numerator and denominator of the basic EPS computation to the numerator and denominator of the diluted EPS computation. Basic EPS excludes dilution. Diluted EPS reflects the potential dilution that could occur if securities or other contracts to issue common stock were exercised or converted into common stock or resulted in the issuance of common stock that then shared in the earnings of the entity. Basic net loss per common share is computed by dividing net loss available to common shareholders by the weighted average number of shares of common shares outstanding during the period. Diluted net loss per common share is computed by dividing net loss by the weighted average number of shares of common stock, common stock equivalents and potentially dilutive securities outstanding during each period. Additionally, potentially dilutive common shares consist of common stock issuable upon conversion of convertible debt. These common stock equivalents may be dilutive in the future. Potentially dilutive common shares were excluded from the computation of diluted shares outstanding as they would have an anti-dilutive impact on the Company’s net losses and consisted of the following:   <table cellspacing="0" cellpadding="0" style="font: 10pt/normal Times New Roman, Times, Serif; width: 100%; border-collapse: collapse; font-size-adjust: none; font-stretch: normal"> <tr style="vertical-align: bottom"> <td style="text-align: justify"> </td> <td style="line-height: normal; padding-bottom: 1pt; font-size-adjust: none; font-stretch: normal"> </td> <td colspan="3" style="line-height: normal; text-align: center; border-bottom: black 1pt solid; font-size-adjust: none; font-stretch: normal">June 30, 2016</td> <td style="line-height: normal; padding-bottom: 1pt; font-size-adjust: none; font-stretch: normal"> </td> <td colspan="3" style="line-height: normal; text-align: center; border-bottom: black 1pt solid; font-size-adjust: none; font-stretch: normal">June 30, 2015</td></tr> <tr style="vertical-align: bottom; background-color: rgb(204, 238, 255)"> <td style="line-height: normal; width: 58%; text-align: justify; padding-bottom: 2.5pt; padding-left: 5.4pt; font-size-adjust: none; font-stretch: normal">     Convertible notes</td> <td style="line-height: normal; width: 8%; padding-bottom: 2.5pt; font-size-adjust: none; font-stretch: normal"> </td> <td style="line-height: normal; width: 1%; text-align: left; border-bottom: black 2.5pt double; font-size-adjust: none; font-stretch: normal"> </td> <td style="line-height: normal; width: 11%; text-align: right; border-bottom: black 2.5pt double; font-size-adjust: none; font-stretch: normal">449,523</td> <td style="line-height: normal; width: 1%; text-align: left; padding-bottom: 2.5pt; font-size-adjust: none; font-stretch: normal"> </td> <td style="line-height: normal; width: 8%; padding-bottom: 2.5pt; font-size-adjust: none; font-stretch: normal"> </td> <td style="line-height: normal; width: 1%; text-align: left; border-bottom: black 2.5pt double; font-size-adjust: none; font-stretch: normal"> </td> <td style="line-height: normal; width: 11%; text-align: right; border-bottom: black 2.5pt double; font-size-adjust: none; font-stretch: normal">30,612</td> <td style="line-height: normal; width: 1%; text-align: left; padding-bottom: 2.5pt; font-size-adjust: none; font-stretch: normal"> </td></tr> </table>

Stock-based compensation    Stock-based compensation is accounted for based on the requirements of the Share-Based Payment Topic of ASC 718 which requires recognition in the financial statements of the cost of employee and director services received in exchange for an award of equity instruments over the period the employee or director is required to perform the services in exchange for the award (presumptively, the vesting period). The ASC also requires measurement of the cost of employee and director services received in exchange for an award based on the grant-date fair value of the award.     Pursuant to ASC Topic 505-50, for share-based payments to consultants and other third-parties, compensation expense is determined at the “measurement date.” The expense is recognized over the service period of the award. Common stock awards issued to consultants represent common stock granted to non-employees in exchange for services at fair value. The measurement dates for such awards are set at the dates that the contracts are entered into as the awards are non-forfeitable and vest immediately. The measurement date fair value is then recognized over the service period as if the Company has paid cash for such service.

Income taxes   The Company accounts for income tax using the liability method prescribed by ASC 740, “Income Taxes”. Under this method, deferred tax assets and liabilities are determined based on the difference between the financial reporting and tax bases of assets and liabilities using enacted tax rates that will be in effect in the year in which the differences are expected to reverse. The Company records a valuation allowance to offset deferred tax assets if based on the weight of available evidence, it is more-likely-than-not that some portion, or all, of the deferred tax assets will not be realized. The effect on deferred taxes of a change in tax rates is recognized as income or loss in the period that includes the enactment date.   The Company follows the accounting guidance for uncertainty in income taxes using the provisions of Accounting Standards Codification (ASC) 740 “Income Taxes”. Using that guidance, tax positions initially need to be recognized in the financial statements when it is more likely than not the position will be sustained upon examination by the tax authorities. As of June 30, 2016 and December 31, 2015, the Company had no uncertain tax positions that qualify for either recognition or disclosure in the financial statements. The Company recognizes interest and penalties related to uncertain income tax positions in other expense. The Company did not record such interest or penalties for the six months ended June 30, 2016 and 2015.

Advertising costs   All costs related to advertising of the Company’s products are expensed in the period incurred.

Shipping and handling costs   For the six months ended June 30, 2016 and 2015, shipping and handling costs incurred for product shipped to customers are included in cost of sales and amounted to $27,750 and $126,018, respectively. Shipping and handling costs charged to customers are included in sales.

Cost of sales   Cost of sales includes inventory costs, materials and supplies costs, and shipping and handling costs incurred.

Revenue recognition   Pursuant to the guidance of ASC Topic 605, the Company recognizes sales when persuasive evidence of an arrangement exists, delivery has occurred or services have been provided, the purchase price is fixed or determinable and collectability is reasonably assured. The Company’s standard terms are “ex works”, with title transferring to its customer at the Company suppliers’ loading docks or upon embarkation with risk of loss being assumed by the customer at the shipping point. The Company has a small percentage of sales with other terms, and revenue is recognized in accordance with the terms of the related customer purchase order. Shipping and handling costs billed to customers are recognized in revenue.

Derivative liabilities   The Company has certain financial instruments that are embedded derivatives associated with capital raises. The Company evaluates all its financial instruments to determine if those contracts or any potential embedded components of those contracts qualify as derivatives to be separately accounted for in accordance with FASB ASC 810-10-05-4 and 815-40.  This accounting treatment requires that the carrying amount of any embedded derivatives be recorded at fair value at issuance and marked-to-market at each balance sheet date.  In the event that the fair value is recorded as a liability, as is the case with the Company, the change in the fair value during the period is recorded as either income or expense. Upon conversion or exercise, the derivative liability is marked to fair value at the conversion date and then the related fair value is reclassified to equity.

Impairment of long-lived assets   In accordance with ASC Topic 360, the Company reviews long-lived assets for impairment whenever events or changes in circumstances indicate that the carrying amount of the assets may not be fully recoverable, or at least annually. The Company recognizes an impairment loss when the sum of expected undiscounted future cash flows is less than the carrying amount of the asset. The amount of impairment is measured as the difference between the asset’s estimated fair value and its book value.

Advances to Supplier   Advances to supplier represent the advance payments for the purchase of product from supplier.

Fair value of financial instruments and fair value measurements   The Company adopted the guidance of Accounting Standards Codification (“ASC”) 820 for fair value measurements which clarifies the definition of fair value, prescribes methods for measuring fair value, and establishes a fair value hierarchy to classify the inputs used in measuring fair value as follows:   Level 1- Inputs are unadjusted quoted prices in active markets for identical assets or liabilities available at the measurement date.   Level 2- Inputs are quoted prices for similar assets and liabilities in active markets, quoted prices for identical or similar assets and liabilities in markets that are not active, inputs other than quoted prices that are observable, and inputs derived from or corroborated by observable market data.   Level 3- Inputs are unobservable inputs that reflect the reporting entity’s own assumptions on what assumptions the market participants would use in pricing the asset or liability based on the best available information.   The carrying amounts reported in the consolidated balance sheets for cash and cash equivalents, accounts receivable, loans, accounts payable, accrued expenses, and other payables approximate their fair market value based on the short-term maturity of these instruments.   The Company analyzes all financial and non-financial instruments with features of both liabilities and equity under the FASB’s accounting standard for such instruments. Under this standard, financial and non-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 accounts for one instrument at fair value using level 3 valuation.   <table cellspacing="0" cellpadding="0" style="font: 10pt/normal Times New Roman, Times, Serif; width: 100%; border-collapse: collapse; font-size-adjust: none; font-stretch: normal"> <tr style="vertical-align: bottom"> <td> </td> <td style="line-height: normal; padding-bottom: 1pt; font-size-adjust: none; font-stretch: normal"> </td> <td colspan="11" style="line-height: normal; text-align: center; border-bottom: black 1pt solid; font-size-adjust: none; font-stretch: normal">At June 30, 2016</td> <td style="line-height: normal; padding-bottom: 1pt; font-size-adjust: none; font-stretch: normal"> </td> <td colspan="11" style="line-height: normal; text-align: center; border-bottom: black 1pt solid; font-size-adjust: none; font-stretch: normal">At December 31, 2015</td></tr> <tr style="vertical-align: bottom; background-color: rgb(204, 238, 255)"> <td style="line-height: normal; padding-bottom: 1pt; padding-left: 5.4pt; font-size-adjust: none; font-stretch: normal">Description</td> <td style="line-height: normal; padding-bottom: 1pt; font-size-adjust: none; font-stretch: normal"> </td> <td style="line-height: normal; text-align: left; border-bottom: black 1pt solid; font-size-adjust: none; font-stretch: normal"> </td> <td style="line-height: normal; text-align: right; border-bottom: black 1pt solid; font-size-adjust: none; font-stretch: normal">Level 1</td> <td style="line-height: normal; text-align: left; padding-bottom: 1pt; font-size-adjust: none; font-stretch: normal"> </td> <td style="line-height: normal; padding-bottom: 1pt; font-size-adjust: none; font-stretch: normal"> </td> <td style="line-height: normal; text-align: left; border-bottom: black 1pt solid; font-size-adjust: none; font-stretch: normal"> </td> <td style="line-height: normal; text-align: right; border-bottom: black 1pt solid; font-size-adjust: none; font-stretch: normal">Level 2</td> <td style="line-height: normal; text-align: left; padding-bottom: 1pt; font-size-adjust: none; font-stretch: normal"> </td> <td style="line-height: normal; padding-bottom: 1pt; font-size-adjust: none; font-stretch: normal"> </td> <td style="line-height: normal; text-align: left; border-bottom: black 1pt solid; font-size-adjust: none; font-stretch: normal"> </td> <td style="line-height: normal; text-align: right; border-bottom: black 1pt solid; font-size-adjust: none; font-stretch: normal">Level 3</td> <td style="line-height: normal; text-align: left; padding-bottom: 1pt; font-size-adjust: none; font-stretch: normal"> </td> <td style="line-height: normal; padding-bottom: 1pt; font-size-adjust: none; font-stretch: normal"> </td> <td style="line-height: normal; text-align: left; border-bottom: black 1pt solid; font-size-adjust: none; font-stretch: normal"> </td> <td style="line-height: normal; text-align: right; border-bottom: black 1pt solid; font-size-adjust: none; font-stretch: normal">Level 1</td> <td style="line-height: normal; text-align: left; padding-bottom: 1pt; font-size-adjust: none; font-stretch: normal"> </td> <td style="line-height: normal; padding-bottom: 1pt; font-size-adjust: none; font-stretch: normal"> </td> <td style="line-height: normal; text-align: left; border-bottom: black 1pt solid; font-size-adjust: none; font-stretch: normal"> </td> <td style="line-height: normal; text-align: right; border-bottom: black 1pt solid; font-size-adjust: none; font-stretch: normal">Level 2</td> <td style="line-height: normal; text-align: left; padding-bottom: 1pt; font-size-adjust: none; font-stretch: normal"> </td> <td style="line-height: normal; padding-bottom: 1pt; font-size-adjust: none; font-stretch: normal"> </td> <td style="line-height: normal; text-align: left; border-bottom: black 1pt solid; font-size-adjust: none; font-stretch: normal"> </td> <td style="line-height: normal; text-align: right; border-bottom: black 1pt solid; font-size-adjust: none; font-stretch: normal">Level 3</td> <td style="line-height: normal; text-align: left; padding-bottom: 1pt; font-size-adjust: none; font-stretch: normal"> </td></tr> <tr style="vertical-align: bottom; background-color: white"> <td style="line-height: normal; width: 46%; text-align: left; padding-left: 5.4pt; font-size-adjust: none; font-stretch: normal">Derivative liability</td> <td style="line-height: normal; width: 1%; font-size-adjust: none; font-stretch: normal"> </td> <td style="line-height: normal; width: 1%; text-align: left; font-size-adjust: none; font-stretch: normal"> </td> <td style="line-height: normal; width: 6%; text-align: right; font-size-adjust: none; font-stretch: normal">—  </td> <td style="line-height: normal; width: 1%; text-align: left; font-size-adjust: none; font-stretch: normal"> </td> <td style="line-height: normal; width: 1%; font-size-adjust: none; font-stretch: normal"> </td> <td style="line-height: normal; width: 1%; text-align: left; font-size-adjust: none; font-stretch: normal"> </td> <td style="line-height: normal; width: 6%; text-align: right; font-size-adjust: none; font-stretch: normal">—  </td> <td style="line-height: normal; width: 1%; text-align: left; font-size-adjust: none; font-stretch: normal"> </td> <td style="line-height: normal; width: 1%; font-size-adjust: none; font-stretch: normal"> </td> <td style="line-height: normal; width: 1%; text-align: left; font-size-adjust: none; font-stretch: normal">$</td> <td style="line-height: normal; width: 6%; text-align: right; font-size-adjust: none; font-stretch: normal">4,950</td> <td style="line-height: normal; width: 1%; text-align: left; font-size-adjust: none; font-stretch: normal"> </td> <td style="line-height: normal; width: 1%; font-size-adjust: none; font-stretch: normal"> </td> <td style="line-height: normal; width: 1%; text-align: left; font-size-adjust: none; font-stretch: normal"> </td> <td style="line-height: normal; width: 6%; text-align: right; font-size-adjust: none; font-stretch: normal">—  </td> <td style="line-height: normal; width: 1%; text-align: left; font-size-adjust: none; font-stretch: normal"> </td> <td style="line-height: normal; width: 1%; font-size-adjust: none; font-stretch: normal"> </td> <td style="line-height: normal; width: 1%; text-align: left; font-size-adjust: none; font-stretch: normal"> </td> <td style="line-height: normal; width: 6%; text-align: right; font-size-adjust: none; font-stretch: normal">—  </td> <td style="line-height: normal; width: 1%; text-align: left; font-size-adjust: none; font-stretch: normal"> </td> <td style="line-height: normal; width: 1%; font-size-adjust: none; font-stretch: normal"> </td> <td style="line-height: normal; width: 1%; text-align: left; font-size-adjust: none; font-stretch: normal">$</td> <td style="line-height: normal; width: 6%; text-align: right; font-size-adjust: none; font-stretch: normal">73,236</td> <td style="line-height: normal; width: 1%; text-align: left; font-size-adjust: none; font-stretch: normal"> </td></tr> </table>     A roll forward of the level 3 valuation financial instruments is as follows:     <table cellspacing="0" cellpadding="0" style="font: 10pt/normal Times New Roman, Times, Serif; width: 100%; border-collapse: collapse; font-size-adjust: none; font-stretch: normal"> <tr style="vertical-align: bottom; background-color: rgb(204, 238, 255)"> <td style="text-align: justify; padding-bottom: 1pt; width: 70%"> </td> <td style="line-height: normal; text-align: center; padding-bottom: 1pt; padding-left: 10pt; font-size-adjust: none; font-stretch: normal; width: 10%"> </td> <td style="padding-bottom: 1pt; width: 1%"> </td> <td style="text-align: center; border-bottom: black 1pt solid; width: 18%">Derivative Liability</td> <td style="text-align: right; border-bottom: black 1pt solid; width: 1%"> </td> <td style="text-align: left; padding-bottom: 1pt"> </td></tr> <tr style="vertical-align: bottom; background-color: white"> <td style="line-height: normal; text-align: justify; padding-left: 5.4pt; font-size-adjust: none; font-stretch: normal">Balance at December 31, 2015</td> <td style="line-height: normal; font-size-adjust: none; font-stretch: normal"> </td> <td style="line-height: normal; text-align: left; font-size-adjust: none; font-stretch: normal">$</td> <td style="line-height: normal; text-align: right; font-size-adjust: none; font-stretch: normal">73,236</td> <td style="line-height: normal; text-align: left; font-size-adjust: none; font-stretch: normal"> </td></tr> <tr style="vertical-align: bottom; background-color: rgb(204, 238, 255)"> <td style="line-height: normal; text-align: justify; padding-left: 5.4pt; font-size-adjust: none; font-stretch: normal">   Reclassification of derivative liability to equity</td> <td style="line-height: normal; font-size-adjust: none; font-stretch: normal"> </td> <td style="line-height: normal; text-align: left; font-size-adjust: none; font-stretch: normal"> </td> <td style="line-height: normal; text-align: right; font-size-adjust: none; font-stretch: normal">(12,786</td> <td style="line-height: normal; text-align: left; font-size-adjust: none; font-stretch: normal">)</td></tr> <tr style="vertical-align: bottom; background-color: white"> <td style="line-height: normal; text-align: justify; padding-bottom: 1pt; padding-left: 5.4pt; font-size-adjust: none; font-stretch: normal">   Change in fair value included in net loss</td> <td style="line-height: normal; padding-bottom: 1pt; font-size-adjust: none; font-stretch: normal"> </td> <td style="line-height: normal; text-align: left; border-bottom: black 1pt solid; font-size-adjust: none; font-stretch: normal"> </td> <td style="line-height: normal; text-align: right; border-bottom: black 1pt solid; font-size-adjust: none; font-stretch: normal">(55,500</td> <td style="line-height: normal; text-align: left; padding-bottom: 1pt; font-size-adjust: none; font-stretch: normal">)</td></tr> <tr style="vertical-align: bottom; background-color: rgb(204, 238, 255)"> <td style="line-height: normal; text-align: justify; padding-bottom: 2.5pt; padding-left: 5.4pt; font-size-adjust: none; font-stretch: normal">Balance at June 30, 2016</td> <td style="line-height: normal; padding-bottom: 2.5pt; font-size-adjust: none; font-stretch: normal"> </td> <td style="line-height: normal; text-align: left; border-bottom: black 2.5pt double; font-size-adjust: none; font-stretch: normal">$</td> <td style="line-height: normal; text-align: right; border-bottom: black 2.5pt double; font-size-adjust: none; font-stretch: normal">4,950</td> <td style="line-height: normal; text-align: left; padding-bottom: 2.5pt; font-size-adjust: none; font-stretch: normal"> </td></tr> <tr style="vertical-align: bottom; background-color: white"> <td> </td> <td> </td> <td style="text-align: left"> </td> <td style="text-align: right"> </td> <td style="text-align: left"> </td></tr> </table>     ASC 825-10 “Financial Instruments”, allows entities to voluntarily choose to measure certain financial assets and liabilities at fair value (fair value option). The fair value option may be elected on an instrument-by-instrument basis and is irrevocable, unless a new election date occurs. If the fair value option is elected for an instrument, unrealized gains and losses for that instrument should be reported in earnings at each subsequent reporting date. The Company did not elect to apply the fair value option to any outstanding instruments.

Accounts receivable   The Company recognizes an allowance for losses on accounts receivable in an amount equal to the estimated probable losses net of recoveries. The allowance is based on an analysis of historical bad debt experience, current receivables aging, and expected future write-offs, as well as an assessment of specific identifiable customer accounts considered at risk or uncollectible. The expense associated with the allowance for doubtful accounts is recognized as general and administrative expense.

Cash and cash equivalents <table cellpadding="0" cellspacing="0" style="width: 100%; font: 10pt/normal Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0"><tr style="vertical-align: top"> <td style="width: 0"></td><td style="width: 9pt"> </td><td></td></tr></table> For purposes of the consolidated statements of cash flows, the Company considers all highly liquid instruments with a maturity of three months or less at the purchase date and money market accounts to be cash equivalents.

Use of estimates   The preparation of consolidated financial statements in conformity with accounting principles generally accepted in the United States 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 consolidated financial statements and the reported amounts of revenue and expenses during the reporting period. Actual results could differ from those estimates. Significant estimates for the six months ended June 30, 2016 and 2015 include estimates of current and deferred income taxes and deferred tax valuation allowances, the fair value of derivative liabilities, and the fair value of non-cash equity transactions.

The Company accounts for one instrument at fair value using level 3 valuation.   <table cellspacing="0" cellpadding="0" style="font: 10pt/normal Times New Roman, Times, Serif; width: 100%; border-collapse: collapse; font-size-adjust: none; font-stretch: normal"> <tr style="vertical-align: bottom"> <td> </td> <td style="line-height: normal; padding-bottom: 1pt; font-size-adjust: none; font-stretch: normal"> </td> <td colspan="11" style="line-height: normal; text-align: center; border-bottom: black 1pt solid; font-size-adjust: none; font-stretch: normal">At June 30, 2016</td> <td style="line-height: normal; padding-bottom: 1pt; font-size-adjust: none; font-stretch: normal"> </td> <td colspan="11" style="line-height: normal; text-align: center; border-bottom: black 1pt solid; font-size-adjust: none; font-stretch: normal">At December 31, 2015</td></tr> <tr style="vertical-align: bottom; background-color: rgb(204, 238, 255)"> <td style="line-height: normal; padding-bottom: 1pt; padding-left: 5.4pt; font-size-adjust: none; font-stretch: normal">Description</td> <td style="line-height: normal; padding-bottom: 1pt; font-size-adjust: none; font-stretch: normal"> </td> <td style="line-height: normal; text-align: left; border-bottom: black 1pt solid; font-size-adjust: none; font-stretch: normal"> </td> <td style="line-height: normal; text-align: right; border-bottom: black 1pt solid; font-size-adjust: none; font-stretch: normal">Level 1</td> <td style="line-height: normal; text-align: left; padding-bottom: 1pt; font-size-adjust: none; font-stretch: normal"> </td> <td style="line-height: normal; padding-bottom: 1pt; font-size-adjust: none; font-stretch: normal"> </td> <td style="line-height: normal; text-align: left; border-bottom: black 1pt solid; font-size-adjust: none; font-stretch: normal"> </td> <td style="line-height: normal; text-align: right; border-bottom: black 1pt solid; font-size-adjust: none; font-stretch: normal">Level 2</td> <td style="line-height: normal; text-align: left; padding-bottom: 1pt; font-size-adjust: none; font-stretch: normal"> </td> <td style="line-height: normal; padding-bottom: 1pt; font-size-adjust: none; font-stretch: normal"> </td> <td style="line-height: normal; text-align: left; border-bottom: black 1pt solid; font-size-adjust: none; font-stretch: normal"> </td> <td style="line-height: normal; text-align: right; border-bottom: black 1pt solid; font-size-adjust: none; font-stretch: normal">Level 3</td> <td style="line-height: normal; text-align: left; padding-bottom: 1pt; font-size-adjust: none; font-stretch: normal"> </td> <td style="line-height: normal; padding-bottom: 1pt; font-size-adjust: none; font-stretch: normal"> </td> <td style="line-height: normal; text-align: left; border-bottom: black 1pt solid; font-size-adjust: none; font-stretch: normal"> </td> <td style="line-height: normal; text-align: right; border-bottom: black 1pt solid; font-size-adjust: none; font-stretch: normal">Level 1</td> <td style="line-height: normal; text-align: left; padding-bottom: 1pt; font-size-adjust: none; font-stretch: normal"> </td> <td style="line-height: normal; padding-bottom: 1pt; font-size-adjust: none; font-stretch: normal"> </td> <td style="line-height: normal; text-align: left; border-bottom: black 1pt solid; font-size-adjust: none; font-stretch: normal"> </td> <td style="line-height: normal; text-align: right; border-bottom: black 1pt solid; font-size-adjust: none; font-stretch: normal">Level 2</td> <td style="line-height: normal; text-align: left; padding-bottom: 1pt; font-size-adjust: none; font-stretch: normal"> </td> <td style="line-height: normal; padding-bottom: 1pt; font-size-adjust: none; font-stretch: normal"> </td> <td style="line-height: normal; text-align: left; border-bottom: black 1pt solid; font-size-adjust: none; font-stretch: normal"> </td> <td style="line-height: normal; text-align: right; border-bottom: black 1pt solid; font-size-adjust: none; font-stretch: normal">Level 3</td> <td style="line-height: normal; text-align: left; padding-bottom: 1pt; font-size-adjust: none; font-stretch: normal"> </td></tr> <tr style="vertical-align: bottom; background-color: white"> <td style="line-height: normal; width: 46%; text-align: left; padding-left: 5.4pt; font-size-adjust: none; font-stretch: normal">Derivative liability</td> <td style="line-height: normal; width: 1%; font-size-adjust: none; font-stretch: normal"> </td> <td style="line-height: normal; width: 1%; text-align: left; font-size-adjust: none; font-stretch: normal"> </td> <td style="line-height: normal; width: 6%; text-align: right; font-size-adjust: none; font-stretch: normal">—  </td> <td style="line-height: normal; width: 1%; text-align: left; font-size-adjust: none; font-stretch: normal"> </td> <td style="line-height: normal; width: 1%; font-size-adjust: none; font-stretch: normal"> </td> <td style="line-height: normal; width: 1%; text-align: left; font-size-adjust: none; font-stretch: normal"> </td> <td style="line-height: normal; width: 6%; text-align: right; font-size-adjust: none; font-stretch: normal">—  </td> <td style="line-height: normal; width: 1%; text-align: left; font-size-adjust: none; font-stretch: normal"> </td> <td style="line-height: normal; width: 1%; font-size-adjust: none; font-stretch: normal"> </td> <td style="line-height: normal; width: 1%; text-align: left; font-size-adjust: none; font-stretch: normal">$</td> <td style="line-height: normal; width: 6%; text-align: right; font-size-adjust: none; font-stretch: normal">4,950</td> <td style="line-height: normal; width: 1%; text-align: left; font-size-adjust: none; font-stretch: normal"> </td> <td style="line-height: normal; width: 1%; font-size-adjust: none; font-stretch: normal"> </td> <td style="line-height: normal; width: 1%; text-align: left; font-size-adjust: none; font-stretch: normal"> </td> <td style="line-height: normal; width: 6%; text-align: right; font-size-adjust: none; font-stretch: normal">—  </td> <td style="line-height: normal; width: 1%; text-align: left; font-size-adjust: none; font-stretch: normal"> </td> <td style="line-height: normal; width: 1%; font-size-adjust: none; font-stretch: normal"> </td> <td style="line-height: normal; width: 1%; text-align: left; font-size-adjust: none; font-stretch: normal"> </td> <td style="line-height: normal; width: 6%; text-align: right; font-size-adjust: none; font-stretch: normal">—  </td> <td style="line-height: normal; width: 1%; text-align: left; font-size-adjust: none; font-stretch: normal"> </td> <td style="line-height: normal; width: 1%; font-size-adjust: none; font-stretch: normal"> </td> <td style="line-height: normal; width: 1%; text-align: left; font-size-adjust: none; font-stretch: normal">$</td> <td style="line-height: normal; width: 6%; text-align: right; font-size-adjust: none; font-stretch: normal">73,236</td> <td style="line-height: normal; width: 1%; text-align: left; font-size-adjust: none; font-stretch: normal"> </td></tr> </table>

A roll forward of the level 3 valuation financial instruments is as follows:     <table cellspacing="0" cellpadding="0" style="font: 10pt/normal Times New Roman, Times, Serif; width: 100%; border-collapse: collapse; font-size-adjust: none; font-stretch: normal"> <tr style="vertical-align: bottom; background-color: rgb(204, 238, 255)"> <td style="text-align: justify; padding-bottom: 1pt; width: 70%"> </td> <td style="line-height: normal; text-align: center; padding-bottom: 1pt; padding-left: 10pt; font-size-adjust: none; font-stretch: normal; width: 10%"> </td> <td style="padding-bottom: 1pt; width: 1%"> </td> <td style="text-align: center; border-bottom: black 1pt solid; width: 18%">Derivative Liability</td> <td style="text-align: right; border-bottom: black 1pt solid; width: 1%"> </td> <td style="text-align: left; padding-bottom: 1pt"> </td></tr> <tr style="vertical-align: bottom; background-color: white"> <td style="line-height: normal; text-align: justify; padding-left: 5.4pt; font-size-adjust: none; font-stretch: normal">Balance at December 31, 2015</td> <td style="line-height: normal; font-size-adjust: none; font-stretch: normal"> </td> <td style="line-height: normal; text-align: left; font-size-adjust: none; font-stretch: normal">$</td> <td style="line-height: normal; text-align: right; font-size-adjust: none; font-stretch: normal">73,236</td> <td style="line-height: normal; text-align: left; font-size-adjust: none; font-stretch: normal"> </td></tr> <tr style="vertical-align: bottom; background-color: rgb(204, 238, 255)"> <td style="line-height: normal; text-align: justify; padding-left: 5.4pt; font-size-adjust: none; font-stretch: normal">   Reclassification of derivative liability to equity</td> <td style="line-height: normal; font-size-adjust: none; font-stretch: normal"> </td> <td style="line-height: normal; text-align: left; font-size-adjust: none; font-stretch: normal"> </td> <td style="line-height: normal; text-align: right; font-size-adjust: none; font-stretch: normal">(12,786</td> <td style="line-height: normal; text-align: left; font-size-adjust: none; font-stretch: normal">)</td></tr> <tr style="vertical-align: bottom; background-color: white"> <td style="line-height: normal; text-align: justify; padding-bottom: 1pt; padding-left: 5.4pt; font-size-adjust: none; font-stretch: normal">   Change in fair value included in net loss</td> <td style="line-height: normal; padding-bottom: 1pt; font-size-adjust: none; font-stretch: normal"> </td> <td style="line-height: normal; text-align: left; border-bottom: black 1pt solid; font-size-adjust: none; font-stretch: normal"> </td> <td style="line-height: normal; text-align: right; border-bottom: black 1pt solid; font-size-adjust: none; font-stretch: normal">(55,500</td> <td style="line-height: normal; text-align: left; padding-bottom: 1pt; font-size-adjust: none; font-stretch: normal">)</td></tr> <tr style="vertical-align: bottom; background-color: rgb(204, 238, 255)"> <td style="line-height: normal; text-align: justify; padding-bottom: 2.5pt; padding-left: 5.4pt; font-size-adjust: none; font-stretch: normal">Balance at June 30, 2016</td> <td style="line-height: normal; padding-bottom: 2.5pt; font-size-adjust: none; font-stretch: normal"> </td> <td style="line-height: normal; text-align: left; border-bottom: black 2.5pt double; font-size-adjust: none; font-stretch: normal">$</td> <td style="line-height: normal; text-align: right; border-bottom: black 2.5pt double; font-size-adjust: none; font-stretch: normal">4,950</td> <td style="line-height: normal; text-align: left; padding-bottom: 2.5pt; font-size-adjust: none; font-stretch: normal"> </td></tr> </table>

Potentially dilutive common shares were excluded from the computation of diluted shares outstanding as they would have an anti-dilutive impact on the Company’s net losses and consisted of the following:   <table cellspacing="0" cellpadding="0" style="font: 10pt/normal Times New Roman, Times, Serif; width: 100%; border-collapse: collapse; font-size-adjust: none; font-stretch: normal"> <tr style="vertical-align: bottom"> <td style="text-align: justify"> </td> <td style="line-height: normal; padding-bottom: 1pt; font-size-adjust: none; font-stretch: normal"> </td> <td colspan="3" style="line-height: normal; text-align: center; border-bottom: black 1pt solid; font-size-adjust: none; font-stretch: normal">June 30, 2016</td> <td style="line-height: normal; padding-bottom: 1pt; font-size-adjust: none; font-stretch: normal"> </td> <td colspan="3" style="line-height: normal; text-align: center; border-bottom: black 1pt solid; font-size-adjust: none; font-stretch: normal">June 30, 2015</td></tr> <tr style="vertical-align: bottom; background-color: rgb(204, 238, 255)"> <td style="line-height: normal; width: 58%; text-align: justify; padding-bottom: 2.5pt; padding-left: 5.4pt; font-size-adjust: none; font-stretch: normal">     Convertible notes</td> <td style="line-height: normal; width: 8%; padding-bottom: 2.5pt; font-size-adjust: none; font-stretch: normal"> </td> <td style="line-height: normal; width: 1%; text-align: left; border-bottom: black 2.5pt double; font-size-adjust: none; font-stretch: normal"> </td> <td style="line-height: normal; width: 11%; text-align: right; border-bottom: black 2.5pt double; font-size-adjust: none; font-stretch: normal">449,523</td> <td style="line-height: normal; width: 1%; text-align: left; padding-bottom: 2.5pt; font-size-adjust: none; font-stretch: normal"> </td> <td style="line-height: normal; width: 8%; padding-bottom: 2.5pt; font-size-adjust: none; font-stretch: normal"> </td> <td style="line-height: normal; width: 1%; text-align: left; border-bottom: black 2.5pt double; font-size-adjust: none; font-stretch: normal"> </td> <td style="line-height: normal; width: 11%; text-align: right; border-bottom: black 2.5pt double; font-size-adjust: none; font-stretch: normal">30,612</td> <td style="line-height: normal; width: 1%; text-align: left; padding-bottom: 2.5pt; font-size-adjust: none; font-stretch: normal"> </td></tr> </table>

At June 30, 2016, and December 31, 2015, the fair value of the derivative liabilities was estimated using the Black-scholes option-pricing model with the following assumptions:   <table cellspacing="0" cellpadding="0" style="font-size: 10pt; line-height: normal; width: 100%; border-collapse: collapse; font-size-adjust: none; font-stretch: normal"> <tr style="vertical-align: bottom"> <td style="font-size: 11pt"> </td> <td style="padding-bottom: 1pt"> </td> <td colspan="3" style="text-align: center; border-bottom: black 1pt solid">June 30, 2016</td> <td style="padding-bottom: 1pt"> </td> <td colspan="3" style="text-align: center; border-bottom: black 1pt solid">December 31, 2015</td></tr> <tr style="vertical-align: bottom; background-color: rgb(204, 238, 255)"> <td style="width: 59%; text-align: left; padding-left: 5.4pt">Dividend rate</td> <td style="width: 8%"> </td> <td style="width: 1%; text-align: left"> </td> <td style="width: 13%; text-align: right">0</td> <td style="width: 1%; text-align: left"> </td> <td style="width: 5%"> </td> <td style="width: 1%; text-align: left"> </td> <td style="width: 11%; text-align: right">0</td> <td style="width: 1%; text-align: left"> </td></tr> <tr style="vertical-align: bottom; background-color: white"> <td style="text-align: left; padding-left: 5.4pt">Term (in years)</td> <td> </td> <td style="text-align: left"> </td> <td style="text-align: right">0.41  to 0.125 years</td> <td style="text-align: left"> </td> <td> </td> <td style="text-align: left"> </td> <td style="text-align: right">0.67 years</td> <td style="text-align: left"> </td></tr> <tr style="vertical-align: bottom; background-color: rgb(204, 238, 255)"> <td style="padding-left: 5.4pt">Volatility</td> <td> </td> <td style="text-align: left"> </td> <td style="text-align: right">100.0</td> <td style="text-align: left">%</td> <td> </td> <td style="text-align: left"> </td> <td style="text-align: right">100.0</td> <td style="text-align: left">%</td></tr> <tr style="vertical-align: bottom; background-color: white"> <td style="text-align: left; padding-left: 5.4pt">Risk-free interest rate</td> <td> </td> <td style="text-align: left"> </td> <td style="text-align: right">0.26% to 0.39%</td> <td style="text-align: left"> </td> <td> </td> <td style="text-align: left"> </td> <td style="text-align: right">0.66</td> <td style="text-align: left">%</td></tr> </table>

At June 30, 2016 and December 31, 2015, convertible promissory notes consisted of the following:   <table cellspacing="0" cellpadding="0" style="font-size: 10pt; line-height: normal; width: 100%; border-collapse: collapse; font-size-adjust: none; font-stretch: normal"> <tr style="vertical-align: bottom"> <td style="font-size: 11pt"> </td> <td style="padding-bottom: 1pt"> </td> <td colspan="3" style="text-align: center; border-bottom: black 1pt solid">June 30, 2016</td> <td style="padding-bottom: 1pt"> </td> <td colspan="3" style="text-align: center; border-bottom: black 1pt solid">December 31, 2015</td></tr> <tr style="vertical-align: bottom; background-color: rgb(204, 238, 255)"> <td style="width: 58%; text-align: left; padding-left: 5.4pt">Principal amount</td> <td style="width: 8%"> </td> <td style="width: 1%; text-align: left">$</td> <td style="width: 11%; text-align: right">118,356</td> <td style="width: 1%; text-align: left"> </td> <td style="width: 8%"> </td> <td style="width: 1%; text-align: left">$</td> <td style="width: 11%; text-align: right">250,000</td> <td style="width: 1%; text-align: left"> </td></tr> <tr style="vertical-align: bottom; background-color: white"> <td style="text-align: left; padding-bottom: 1pt; padding-left: 5.4pt">Less: unamortized debt discount</td> <td style="padding-bottom: 1pt"> </td> <td style="text-align: left; border-bottom: black 1pt solid"> </td> <td style="text-align: right; border-bottom: black 1pt solid">(27,842</td> <td style="text-align: left; padding-bottom: 1pt">)</td> <td style="padding-bottom: 1pt"> </td> <td style="text-align: left; border-bottom: black 1pt solid"> </td> <td style="text-align: right; border-bottom: black 1pt solid">(120,813</td> <td style="text-align: left; padding-bottom: 1pt">)</td></tr> <tr style="vertical-align: bottom; background-color: rgb(204, 238, 255)"> <td style="text-align: left; padding-bottom: 2.5pt; padding-left: 5.4pt">Convertible notes payable, net</td> <td style="padding-bottom: 2.5pt"> </td> <td style="text-align: left; border-bottom: black 2.5pt double">$</td> <td style="text-align: right; border-bottom: black 2.5pt double">90,514</td> <td style="text-align: left; padding-bottom: 2.5pt"> </td> <td style="padding-bottom: 2.5pt"> </td> <td style="text-align: left; border-bottom: black 2.5pt double">$</td> <td style="text-align: right; border-bottom: black 2.5pt double">129,187</td></tr> </table>

For the six months ended June 30, 2016 and 2015, due to related party activity consisted of the following:   <table cellspacing="0" cellpadding="0" style="font: 10pt/normal Times New Roman, Times, Serif; width: 100%; border-collapse: collapse; font-size-adjust: none; font-stretch: normal"> <tr style="vertical-align: bottom"> <td style="text-align: justify"> </td> <td style="line-height: normal; padding-bottom: 1pt; font-size-adjust: none; font-stretch: normal"> </td> <td colspan="3" style="line-height: normal; text-align: center; border-bottom: black 1pt solid; font-size-adjust: none; font-stretch: normal">Six Months ended   June 30, 2016</td> <td style="line-height: normal; padding-bottom: 1pt; font-size-adjust: none; font-stretch: normal"> </td> <td colspan="3" style="line-height: normal; text-align: center; border-bottom: black 1pt solid; font-size-adjust: none; font-stretch: normal">Six Months ended   June 30, 2015</td></tr> <tr style="vertical-align: bottom; background-color: rgb(204, 238, 255)"> <td style="line-height: normal; width: 58%; text-align: justify; padding-left: 5.4pt; font-size-adjust: none; font-stretch: normal">Balance due to related party at beginning of period</td> <td style="line-height: normal; width: 8%; font-size-adjust: none; font-stretch: normal"> </td> <td style="line-height: normal; width: 1%; text-align: left; font-size-adjust: none; font-stretch: normal">$</td> <td style="line-height: normal; width: 11%; text-align: right; font-size-adjust: none; font-stretch: normal">38,434</td> <td style="line-height: normal; width: 1%; text-align: left; font-size-adjust: none; font-stretch: normal"> </td> <td style="line-height: normal; width: 8%; font-size-adjust: none; font-stretch: normal"> </td> <td style="line-height: normal; width: 1%; text-align: left; font-size-adjust: none; font-stretch: normal">$</td> <td style="line-height: normal; width: 11%; text-align: right; font-size-adjust: none; font-stretch: normal">8,051</td> <td style="line-height: normal; width: 1%; text-align: left; font-size-adjust: none; font-stretch: normal"> </td></tr> <tr style="vertical-align: bottom; background-color: white"> <td style="line-height: normal; text-align: left; padding-left: 5.4pt; font-size-adjust: none; font-stretch: normal">Working capital advances received</td> <td style="line-height: normal; font-size-adjust: none; font-stretch: normal"> </td> <td style="line-height: normal; text-align: left; font-size-adjust: none; font-stretch: normal"> </td> <td style="line-height: normal; text-align: right; font-size-adjust: none; font-stretch: normal">—  </td> <td style="line-height: normal; text-align: left; font-size-adjust: none; font-stretch: normal"> </td> <td style="line-height: normal; font-size-adjust: none; font-stretch: normal"> </td> <td style="line-height: normal; text-align: left; font-size-adjust: none; font-stretch: normal"> </td> <td style="line-height: normal; text-align: right; font-size-adjust: none; font-stretch: normal">800</td> <td style="line-height: normal; text-align: left; font-size-adjust: none; font-stretch: normal"> </td></tr> <tr style="vertical-align: bottom; background-color: rgb(204, 238, 255)"> <td style="line-height: normal; text-align: left; padding-bottom: 1pt; padding-left: 5.4pt; font-size-adjust: none; font-stretch: normal">Repayments made and conversions</td> <td style="line-height: normal; padding-bottom: 1pt; font-size-adjust: none; font-stretch: normal"> </td> <td style="line-height: normal; text-align: left; border-bottom: black 1pt solid; font-size-adjust: none; font-stretch: normal"> </td> <td style="line-height: normal; text-align: right; border-bottom: black 1pt solid; font-size-adjust: none; font-stretch: normal">(35,879</td> <td style="line-height: normal; text-align: left; padding-bottom: 1pt; font-size-adjust: none; font-stretch: normal">)</td> <td style="line-height: normal; padding-bottom: 1pt; font-size-adjust: none; font-stretch: normal"> </td> <td style="line-height: normal; text-align: left; border-bottom: black 1pt solid; font-size-adjust: none; font-stretch: normal"> </td> <td style="line-height: normal; text-align: right; border-bottom: black 1pt solid; font-size-adjust: none; font-stretch: normal">(983</td> <td style="line-height: normal; text-align: left; padding-bottom: 1pt; font-size-adjust: none; font-stretch: normal">)</td></tr> <tr style="vertical-align: bottom; background-color: white"> <td style="line-height: normal; text-align: justify; padding-bottom: 2.5pt; padding-left: 5.4pt; font-size-adjust: none; font-stretch: normal">Balance due to related party at end of period</td> <td style="line-height: normal; padding-bottom: 2.5pt; font-size-adjust: none; font-stretch: normal"> </td> <td style="line-height: normal; text-align: left; border-bottom: black 2.5pt double; font-size-adjust: none; font-stretch: normal">$</td> <td style="line-height: normal; text-align: right; border-bottom: black 2.5pt double; font-size-adjust: none; font-stretch: normal">2,555</td> <td style="line-height: normal; text-align: left; padding-bottom: 2.5pt; font-size-adjust: none; font-stretch: normal"> </td> <td style="line-height: normal; padding-bottom: 2.5pt; font-size-adjust: none; font-stretch: normal"> </td> <td style="line-height: normal; text-align: left; border-bottom: black 2.5pt double; font-size-adjust: none; font-stretch: normal">$</td> <td style="line-height: normal; text-align: right; border-bottom: black 2.5pt double; font-size-adjust: none; font-stretch: normal">7,868</td></tr> </table>

The effect of correcting these errors in the Company’s unaudited consolidated financial statements for the three and six months ended June 30, 2015 are shown in the table as follows:   <table cellspacing="0" cellpadding="0" style="font: 10pt/normal Times New Roman, Times, Serif; width: 100%; border-collapse: collapse; font-size-adjust: none; font-stretch: normal"> <tr style="vertical-align: bottom"> <td style="line-height: normal; border-bottom: black 1pt solid; font-size-adjust: none; font-stretch: normal">Consolidated Statement of operations</td> <td style="line-height: normal; padding-bottom: 1pt; font-size-adjust: none; font-stretch: normal"> </td> <td colspan="11" style="line-height: normal; text-align: center; border-bottom: black 1pt solid; font-size-adjust: none; font-stretch: normal">For the Six Months Ended June 30, 2015 (Unaudited)</td></tr> <tr style="vertical-align: bottom"> <td> </td> <td style="line-height: normal; padding-bottom: 1pt; font-size-adjust: none; font-stretch: normal"> </td> <td colspan="3" style="line-height: normal; text-align: center; border-bottom: black 1pt solid; font-size-adjust: none; font-stretch: normal">As previously reported</td> <td style="line-height: normal; padding-bottom: 1pt; font-size-adjust: none; font-stretch: normal"> </td> <td colspan="3" style="line-height: normal; text-align: center; border-bottom: black 1pt solid; font-size-adjust: none; font-stretch: normal">Adjustments to Restate</td> <td style="line-height: normal; padding-bottom: 1pt; font-size-adjust: none; font-stretch: normal"> </td> <td colspan="3" style="line-height: normal; text-align: center; border-bottom: black 1pt solid; font-size-adjust: none; font-stretch: normal">As Restated</td></tr> <tr style="vertical-align: bottom; background-color: rgb(204, 238, 255)"> <td style="line-height: normal; width: 46%; font-size-adjust: none; font-stretch: normal">Revenues</td> <td style="line-height: normal; width: 5%; font-size-adjust: none; font-stretch: normal"> </td> <td style="line-height: normal; width: 1%; text-align: left; font-size-adjust: none; font-stretch: normal">$</td> <td style="line-height: normal; width: 11%; text-align: right; font-size-adjust: none; font-stretch: normal">1,341,890</td> <td style="line-height: normal; width: 1%; text-align: left; font-size-adjust: none; font-stretch: normal"> </td> <td style="line-height: normal; width: 5%; font-size-adjust: none; font-stretch: normal"> </td> <td style="line-height: normal; width: 1%; text-align: left; font-size-adjust: none; font-stretch: normal">$</td> <td style="line-height: normal; width: 11%; text-align: right; font-size-adjust: none; font-stretch: normal">7,200</td> <td style="line-height: normal; width: 1%; text-align: left; font-size-adjust: none; font-stretch: normal"> </td> <td style="line-height: normal; width: 5%; font-size-adjust: none; font-stretch: normal"> </td> <td style="line-height: normal; width: 1%; text-align: left; font-size-adjust: none; font-stretch: normal">$</td> <td style="line-height: normal; width: 11%; text-align: right; font-size-adjust: none; font-stretch: normal">1,349,090</td> <td style="line-height: normal; width: 1%; text-align: left; font-size-adjust: none; font-stretch: normal"> </td></tr> <tr style="vertical-align: bottom; background-color: white"> <td style="line-height: normal; padding-bottom: 1pt; font-size-adjust: none; font-stretch: normal">Cost of revenues</td> <td style="line-height: normal; padding-bottom: 1pt; font-size-adjust: none; font-stretch: normal"> </td> <td style="line-height: normal; text-align: left; border-bottom: black 1pt solid; font-size-adjust: none; font-stretch: normal"> </td> <td style="line-height: normal; text-align: right; border-bottom: black 1pt solid; font-size-adjust: none; font-stretch: normal">1,185,340</td> <td style="line-height: normal; text-align: left; padding-bottom: 1pt; font-size-adjust: none; font-stretch: normal"> </td> <td style="line-height: normal; padding-bottom: 1pt; font-size-adjust: none; font-stretch: normal"> </td> <td style="line-height: normal; text-align: left; border-bottom: black 1pt solid; font-size-adjust: none; font-stretch: normal"> </td> <td style="line-height: normal; text-align: right; border-bottom: black 1pt solid; font-size-adjust: none; font-stretch: normal">57,564</td> <td style="line-height: normal; text-align: left; padding-bottom: 1pt; font-size-adjust: none; font-stretch: normal"> </td> <td style="line-height: normal; padding-bottom: 1pt; font-size-adjust: none; font-stretch: normal"> </td> <td style="line-height: normal; text-align: left; border-bottom: black 1pt solid; font-size-adjust: none; font-stretch: normal"> </td> <td style="line-height: normal; text-align: right; border-bottom: black 1pt solid; font-size-adjust: none; font-stretch: normal">1,242,904</td> <td style="line-height: normal; text-align: left; padding-bottom: 1pt; font-size-adjust: none; font-stretch: normal"> </td></tr> <tr style="vertical-align: bottom; background-color: rgb(204, 238, 255)"> <td style="line-height: normal; text-align: left; font-size-adjust: none; font-stretch: normal">Gross profit</td> <td style="line-height: normal; font-size-adjust: none; font-stretch: normal"> </td> <td style="line-height: normal; text-align: left; font-size-adjust: none; font-stretch: normal"> </td> <td style="line-height: normal; text-align: right; font-size-adjust: none; font-stretch: normal">156,550</td> <td style="line-height: normal; text-align: left; font-size-adjust: none; font-stretch: normal"> </td> <td style="line-height: normal; font-size-adjust: none; font-stretch: normal"> </td> <td style="line-height: normal; text-align: left; font-size-adjust: none; font-stretch: normal"> </td> <td style="line-height: normal; text-align: right; font-size-adjust: none; font-stretch: normal">(50,364</td> <td style="line-height: normal; text-align: left; font-size-adjust: none; font-stretch: normal">)</td> <td style="line-height: normal; font-size-adjust: none; font-stretch: normal"> </td> <td style="line-height: normal; text-align: left; font-size-adjust: none; font-stretch: normal"> </td> <td style="line-height: normal; text-align: right; font-size-adjust: none; font-stretch: normal">106,186</td> <td style="line-height: normal; text-align: left; font-size-adjust: none; font-stretch: normal"> </td></tr> <tr style="vertical-align: bottom; background-color: white"> <td style="line-height: normal; text-align: left; padding-bottom: 1pt; font-size-adjust: none; font-stretch: normal">Operating expenses</td> <td style="line-height: normal; padding-bottom: 1pt; font-size-adjust: none; font-stretch: normal"> </td> <td style="line-height: normal; text-align: left; border-bottom: black 1pt solid; font-size-adjust: none; font-stretch: normal"> </td> <td style="line-height: normal; text-align: right; border-bottom: black 1pt solid; font-size-adjust: none; font-stretch: normal">217,711</td> <td style="line-height: normal; text-align: left; padding-bottom: 1pt; font-size-adjust: none; font-stretch: normal"> </td> <td style="line-height: normal; padding-bottom: 1pt; font-size-adjust: none; font-stretch: normal"> </td> <td style="line-height: normal; text-align: left; border-bottom: black 1pt solid; font-size-adjust: none; font-stretch: normal"> </td> <td style="line-height: normal; text-align: right; border-bottom: black 1pt solid; font-size-adjust: none; font-stretch: normal">(22,347</td> <td style="line-height: normal; text-align: left; padding-bottom: 1pt; font-size-adjust: none; font-stretch: normal">)</td> <td style="line-height: normal; padding-bottom: 1pt; font-size-adjust: none; font-stretch: normal"> </td> <td style="line-height: normal; text-align: left; border-bottom: black 1pt solid; font-size-adjust: none; font-stretch: normal"> </td> <td style="line-height: normal; text-align: right; border-bottom: black 1pt solid; font-size-adjust: none; font-stretch: normal">195,364</td> <td style="line-height: normal; text-align: left; padding-bottom: 1pt; font-size-adjust: none; font-stretch: normal"> </td></tr> <tr style="vertical-align: bottom; background-color: rgb(204, 238, 255)"> <td style="line-height: normal; text-align: left; padding-bottom: 1pt; font-size-adjust: none; font-stretch: normal">Loss from operations</td> <td style="line-height: normal; padding-bottom: 1pt; font-size-adjust: none; font-stretch: normal"> </td> <td style="line-height: normal; text-align: left; border-bottom: black 1pt solid; font-size-adjust: none; font-stretch: normal"> </td> <td style="line-height: normal; text-align: right; border-bottom: black 1pt solid; font-size-adjust: none; font-stretch: normal">(61,161</td> <td style="line-height: normal; text-align: left; padding-bottom: 1pt; font-size-adjust: none; font-stretch: normal">)</td> <td style="line-height: normal; padding-bottom: 1pt; font-size-adjust: none; font-stretch: normal"> </td> <td style="line-height: normal; text-align: left; border-bottom: black 1pt solid; font-size-adjust: none; font-stretch: normal"> </td> <td style="line-height: normal; text-align: right; border-bottom: black 1pt solid; font-size-adjust: none; font-stretch: normal">(28,017</td> <td style="line-height: normal; text-align: left; padding-bottom: 1pt; font-size-adjust: none; font-stretch: normal">)</td> <td style="line-height: normal; padding-bottom: 1pt; font-size-adjust: none; font-stretch: normal"> </td> <td style="line-height: normal; text-align: left; border-bottom: black 1pt solid; font-size-adjust: none; font-stretch: normal"> </td> <td style="line-height: normal; text-align: right; border-bottom: black 1pt solid; font-size-adjust: none; font-stretch: normal">(89,178</td> <td style="line-height: normal; text-align: left; padding-bottom: 1pt; font-size-adjust: none; font-stretch: normal">)</td></tr> <tr style="vertical-align: bottom; background-color: white"> <td style="line-height: normal; text-align: left; padding-bottom: 2.5pt; font-size-adjust: none; font-stretch: normal">Other expenses</td> <td style="line-height: normal; padding-bottom: 2.5pt; font-size-adjust: none; font-stretch: normal"> </td> <td style="line-height: normal; text-align: left; border-bottom: black 2.5pt double; font-size-adjust: none; font-stretch: normal"> </td> <td style="line-height: normal; text-align: right; border-bottom: black 2.5pt double; font-size-adjust: none; font-stretch: normal">—  </td> <td style="line-height: normal; text-align: left; padding-bottom: 2.5pt; font-size-adjust: none; font-stretch: normal"> </td> <td style="line-height: normal; padding-bottom: 2.5pt; font-size-adjust: none; font-stretch: normal"> </td> <td style="line-height: normal; text-align: left; border-bottom: black 2.5pt double; font-size-adjust: none; font-stretch: normal"> </td> <td style="line-height: normal; text-align: right; border-bottom: black 2.5pt double; font-size-adjust: none; font-stretch: normal">(47</td> <td style="line-height: normal; text-align: left; padding-bottom: 2.5pt; font-size-adjust: none; font-stretch: normal">)</td> <td style="line-height: normal; padding-bottom: 2.5pt; font-size-adjust: none; font-stretch: normal"> </td> <td style="line-height: normal; text-align: left; border-bottom: black 2.5pt double; font-size-adjust: none; font-stretch: normal"> </td> <td style="line-height: normal; text-align: right; border-bottom: black 2.5pt double; font-size-adjust: none; font-stretch: normal">(47</td> <td style="line-height: normal; text-align: left; padding-bottom: 2.5pt; font-size-adjust: none; font-stretch: normal">)</td></tr> <tr style="vertical-align: bottom; background-color: rgb(204, 238, 255)"> <td style="line-height: normal; text-align: left; padding-bottom: 2.5pt; font-size-adjust: none; font-stretch: normal">Net loss</td> <td style="line-height: normal; padding-bottom: 2.5pt; font-size-adjust: none; font-stretch: normal"> </td> <td style="line-height: normal; text-align: left; border-bottom: black 2.5pt double; font-size-adjust: none; font-stretch: normal">$</td> <td style="line-height: normal; text-align: right; border-bottom: black 2.5pt double; font-size-adjust: none; font-stretch: normal">(61,161</td> <td style="line-height: normal; text-align: left; padding-bottom: 2.5pt; font-size-adjust: none; font-stretch: normal">)</td> <td style="line-height: normal; padding-bottom: 2.5pt; font-size-adjust: none; font-stretch: normal"> </td> <td style="line-height: normal; text-align: left; border-bottom: black 2.5pt double; font-size-adjust: none; font-stretch: normal">$</td> <td style="line-height: normal; text-align: right; border-bottom: black 2.5pt double; font-size-adjust: none; font-stretch: normal">(28,064</td> <td style="line-height: normal; text-align: left; padding-bottom: 2.5pt; font-size-adjust: none; font-stretch: normal">)</td> <td style="line-height: normal; padding-bottom: 2.5pt; font-size-adjust: none; font-stretch: normal"> </td> <td style="line-height: normal; text-align: left; border-bottom: black 2.5pt double; font-size-adjust: none; font-stretch: normal">$</td> <td style="line-height: normal; text-align: right; border-bottom: black 2.5pt double; font-size-adjust: none; font-stretch: normal">(89,225</td> <td style="line-height: normal; text-align: left; padding-bottom: 2.5pt; font-size-adjust: none; font-stretch: normal">)</td></tr> <tr style="vertical-align: bottom; background-color: white"> <td style="line-height: normal; padding-bottom: 2.5pt; font-size-adjust: none; font-stretch: normal">Net loss per common share</td> <td style="line-height: normal; padding-bottom: 2.5pt; font-size-adjust: none; font-stretch: normal"> </td> <td style="line-height: normal; text-align: left; border-bottom: black 2.5pt double; font-size-adjust: none; font-stretch: normal">$</td> <td style="line-height: normal; text-align: right; border-bottom: black 2.5pt double; font-size-adjust: none; font-stretch: normal">(0.00</td> <td style="line-height: normal; text-align: left; padding-bottom: 2.5pt; font-size-adjust: none; font-stretch: normal">)</td> <td style="line-height: normal; padding-bottom: 2.5pt; font-size-adjust: none; font-stretch: normal"> </td> <td style="line-height: normal; text-align: left; border-bottom: black 2.5pt double; font-size-adjust: none; font-stretch: normal">$</td> <td style="line-height: normal; text-align: right; border-bottom: black 2.5pt double; font-size-adjust: none; font-stretch: normal">(0.00</td> <td style="line-height: normal; text-align: left; padding-bottom: 2.5pt; font-size-adjust: none; font-stretch: normal">)</td> <td style="line-height: normal; padding-bottom: 2.5pt; font-size-adjust: none; font-stretch: normal"> </td> <td style="line-height: normal; text-align: left; border-bottom: black 2.5pt double; font-size-adjust: none; font-stretch: normal">$</td> <td style="line-height: normal; text-align: right; border-bottom: black 2.5pt double; font-size-adjust: none; font-stretch: normal">(0.01</td> <td style="line-height: normal; text-align: left; padding-bottom: 2.5pt; font-size-adjust: none; font-stretch: normal">)</td></tr> </table>   <table cellspacing="0" cellpadding="0" style="font: 10pt/normal Times New Roman, Times, Serif; width: 100%; border-collapse: collapse; font-size-adjust: none; font-stretch: normal"> <tr style="vertical-align: bottom"> <td style="line-height: normal; border-bottom: black 1pt solid; font-size-adjust: none; font-stretch: normal">Consolidated Statement of operations</td> <td style="line-height: normal; padding-bottom: 1pt; font-size-adjust: none; font-stretch: normal"> </td> <td colspan="11" style="line-height: normal; text-align: center; border-bottom: black 1pt solid; font-size-adjust: none; font-stretch: normal">For the Three Months Ended June 30, 2015 (Unaudited)</td></tr> <tr style="vertical-align: bottom"> <td> </td> <td style="line-height: normal; padding-bottom: 1pt; font-size-adjust: none; font-stretch: normal"> </td> <td colspan="3" style="line-height: normal; text-align: center; border-bottom: black 1pt solid; font-size-adjust: none; font-stretch: normal">As previously reported</td> <td style="line-height: normal; padding-bottom: 1pt; font-size-adjust: none; font-stretch: normal"> </td> <td colspan="3" style="line-height: normal; text-align: center; border-bottom: black 1pt solid; font-size-adjust: none; font-stretch: normal">Adjustments to Restate</td> <td style="line-height: normal; padding-bottom: 1pt; font-size-adjust: none; font-stretch: normal"> </td> <td colspan="3" style="line-height: normal; text-align: center; border-bottom: black 1pt solid; font-size-adjust: none; font-stretch: normal">As Restated</td></tr> <tr style="vertical-align: bottom; background-color: rgb(204, 238, 255)"> <td style="line-height: normal; width: 46%; font-size-adjust: none; font-stretch: normal">Revenues</td> <td style="line-height: normal; width: 5%; font-size-adjust: none; font-stretch: normal"> </td> <td style="line-height: normal; width: 1%; text-align: left; font-size-adjust: none; font-stretch: normal">$</td> <td style="line-height: normal; width: 11%; text-align: right; font-size-adjust: none; font-stretch: normal">557,348</td> <td style="line-height: normal; width: 1%; text-align: left; font-size-adjust: none; font-stretch: normal"> </td> <td style="line-height: normal; width: 5%; font-size-adjust: none; font-stretch: normal"> </td> <td style="line-height: normal; width: 1%; text-align: left; font-size-adjust: none; font-stretch: normal">$</td> <td style="line-height: normal; width: 11%; text-align: right; font-size-adjust: none; font-stretch: normal">17,248</td> <td style="line-height: normal; width: 1%; text-align: left; font-size-adjust: none; font-stretch: normal"> </td> <td style="line-height: normal; width: 5%; font-size-adjust: none; font-stretch: normal"> </td> <td style="line-height: normal; width: 1%; text-align: left; font-size-adjust: none; font-stretch: normal">$</td> <td style="line-height: normal; width: 11%; text-align: right; font-size-adjust: none; font-stretch: normal">574,596</td> <td style="line-height: normal; width: 1%; text-align: left; font-size-adjust: none; font-stretch: normal"> </td></tr> <tr style="vertical-align: bottom; background-color: white"> <td style="line-height: normal; padding-bottom: 1pt; font-size-adjust: none; font-stretch: normal">Cost of revenues</td> <td style="line-height: normal; padding-bottom: 1pt; font-size-adjust: none; font-stretch: normal"> </td> <td style="line-height: normal; text-align: left; border-bottom: black 1pt solid; font-size-adjust: none; font-stretch: normal"> </td> <td style="line-height: normal; text-align: right; border-bottom: black 1pt solid; font-size-adjust: none; font-stretch: normal">469,489</td> <td style="line-height: normal; text-align: left; padding-bottom: 1pt; font-size-adjust: none; font-stretch: normal"> </td> <td style="line-height: normal; padding-bottom: 1pt; font-size-adjust: none; font-stretch: normal"> </td> <td style="line-height: normal; text-align: left; border-bottom: black 1pt solid; font-size-adjust: none; font-stretch: normal"> </td> <td style="line-height: normal; text-align: right; border-bottom: black 1pt solid; font-size-adjust: none; font-stretch: normal">18,886</td> <td style="line-height: normal; text-align: left; padding-bottom: 1pt; font-size-adjust: none; font-stretch: normal"> </td> <td style="line-height: normal; padding-bottom: 1pt; font-size-adjust: none; font-stretch: normal"> </td> <td style="line-height: normal; text-align: left; border-bottom: black 1pt solid; font-size-adjust: none; font-stretch: normal"> </td> <td style="line-height: normal; text-align: right; border-bottom: black 1pt solid; font-size-adjust: none; font-stretch: normal">488,375</td> <td style="line-height: normal; text-align: left; padding-bottom: 1pt; font-size-adjust: none; font-stretch: normal"> </td></tr> <tr style="vertical-align: bottom; background-color: rgb(204, 238, 255)"> <td style="line-height: normal; text-align: left; font-size-adjust: none; font-stretch: normal">Gross profit</td> <td style="line-height: normal; font-size-adjust: none; font-stretch: normal"> </td> <td style="line-height: normal; text-align: left; font-size-adjust: none; font-stretch: normal"> </td> <td style="line-height: normal; text-align: right; font-size-adjust: none; font-stretch: normal">87,859</td> <td style="line-height: normal; text-align: left; font-size-adjust: none; font-stretch: normal"> </td> <td style="line-height: normal; font-size-adjust: none; font-stretch: normal"> </td> <td style="line-height: normal; text-align: left; font-size-adjust: none; font-stretch: normal"> </td> <td style="line-height: normal; text-align: right; font-size-adjust: none; font-stretch: normal">(1,638</td> <td style="line-height: normal; text-align: left; font-size-adjust: none; font-stretch: normal">)</td> <td style="line-height: normal; font-size-adjust: none; font-stretch: normal"> </td> <td style="line-height: normal; text-align: left; font-size-adjust: none; font-stretch: normal"> </td> <td style="line-height: normal; text-align: right; font-size-adjust: none; font-stretch: normal">86,221</td> <td style="line-height: normal; text-align: left; font-size-adjust: none; font-stretch: normal"> </td></tr> <tr style="vertical-align: bottom; background-color: white"> <td style="line-height: normal; text-align: left; padding-bottom: 1pt; font-size-adjust: none; font-stretch: normal">Operating expenses</td> <td style="line-height: normal; padding-bottom: 1pt; font-size-adjust: none; font-stretch: normal"> </td> <td style="line-height: normal; text-align: left; border-bottom: black 1pt solid; font-size-adjust: none; font-stretch: normal"> </td> <td style="line-height: normal; text-align: right; border-bottom: black 1pt solid; font-size-adjust: none; font-stretch: normal">105,600</td> <td style="line-height: normal; text-align: left; padding-bottom: 1pt; font-size-adjust: none; font-stretch: normal"> </td> <td style="line-height: normal; padding-bottom: 1pt; font-size-adjust: none; font-stretch: normal"> </td> <td style="line-height: normal; text-align: left; border-bottom: black 1pt solid; font-size-adjust: none; font-stretch: normal"> </td> <td style="line-height: normal; text-align: right; border-bottom: black 1pt solid; font-size-adjust: none; font-stretch: normal">(9,505</td> <td style="line-height: normal; text-align: left; padding-bottom: 1pt; font-size-adjust: none; font-stretch: normal">)</td> <td style="line-height: normal; padding-bottom: 1pt; font-size-adjust: none; font-stretch: normal"> </td> <td style="line-height: normal; text-align: left; border-bottom: black 1pt solid; font-size-adjust: none; font-stretch: normal"> </td> <td style="line-height: normal; text-align: right; border-bottom: black 1pt solid; font-size-adjust: none; font-stretch: normal">96,095</td> <td style="line-height: normal; text-align: left; padding-bottom: 1pt; font-size-adjust: none; font-stretch: normal"> </td></tr> <tr style="vertical-align: bottom; background-color: rgb(204, 238, 255)"> <td style="line-height: normal; text-align: left; padding-bottom: 1pt; font-size-adjust: none; font-stretch: normal">Loss from operations</td> <td style="line-height: normal; padding-bottom: 1pt; font-size-adjust: none; font-stretch: normal"> </td> <td style="line-height: normal; text-align: left; border-bottom: black 1pt solid; font-size-adjust: none; font-stretch: normal"> </td> <td style="line-height: normal; text-align: right; border-bottom: black 1pt solid; font-size-adjust: none; font-stretch: normal">(17,741</td> <td style="line-height: normal; text-align: left; padding-bottom: 1pt; font-size-adjust: none; font-stretch: normal">)</td> <td style="line-height: normal; padding-bottom: 1pt; font-size-adjust: none; font-stretch: normal"> </td> <td style="line-height: normal; text-align: left; border-bottom: black 1pt solid; font-size-adjust: none; font-stretch: normal"> </td> <td style="line-height: normal; text-align: right; border-bottom: black 1pt solid; font-size-adjust: none; font-stretch: normal">7,867</td> <td style="line-height: normal; text-align: left; padding-bottom: 1pt; font-size-adjust: none; font-stretch: normal"> </td> <td style="line-height: normal; padding-bottom: 1pt; font-size-adjust: none; font-stretch: normal"> </td> <td style="line-height: normal; text-align: left; border-bottom: black 1pt solid; font-size-adjust: none; font-stretch: normal"> </td> <td style="line-height: normal; text-align: right; border-bottom: black 1pt solid; font-size-adjust: none; font-stretch: normal">(9,874</td> <td style="line-height: normal; text-align: left; padding-bottom: 1pt; font-size-adjust: none; font-stretch: normal">)</td></tr> <tr style="vertical-align: bottom; background-color: white"> <td style="line-height: normal; text-align: left; padding-bottom: 2.5pt; font-size-adjust: none; font-stretch: normal">Other expenses</td> <td style="line-height: normal; padding-bottom: 2.5pt; font-size-adjust: none; font-stretch: normal"> </td> <td style="line-height: normal; text-align: left; border-bottom: black 2.5pt double; font-size-adjust: none; font-stretch: normal"> </td> <td style="line-height: normal; text-align: right; border-bottom: black 2.5pt double; font-size-adjust: none; font-stretch: normal">—  </td> <td style="line-height: normal; text-align: left; padding-bottom: 2.5pt; font-size-adjust: none; font-stretch: normal"> </td> <td style="line-height: normal; padding-bottom: 2.5pt; font-size-adjust: none; font-stretch: normal"> </td> <td style="line-height: normal; text-align: left; border-bottom: black 2.5pt double; font-size-adjust: none; font-stretch: normal"> </td> <td style="line-height: normal; text-align: right; border-bottom: black 2.5pt double; font-size-adjust: none; font-stretch: normal">(47</td> <td style="line-height: normal; text-align: left; padding-bottom: 2.5pt; font-size-adjust: none; font-stretch: normal">)</td> <td style="line-height: normal; padding-bottom: 2.5pt; font-size-adjust: none; font-stretch: normal"> </td> <td style="line-height: normal; text-align: left; border-bottom: black 2.5pt double; font-size-adjust: none; font-stretch: normal"> </td> <td style="line-height: normal; text-align: right; border-bottom: black 2.5pt double; font-size-adjust: none; font-stretch: normal">(47</td> <td style="line-height: normal; text-align: left; padding-bottom: 2.5pt; font-size-adjust: none; font-stretch: normal">)</td></tr> <tr style="vertical-align: bottom; background-color: rgb(204, 238, 255)"> <td style="line-height: normal; text-align: left; padding-bottom: 2.5pt; font-size-adjust: none; font-stretch: normal">Net loss</td> <td style="line-height: normal; padding-bottom: 2.5pt; font-size-adjust: none; font-stretch: normal"> </td> <td style="line-height: normal; text-align: left; border-bottom: black 2.5pt double; font-size-adjust: none; font-stretch: normal">$</td> <td style="line-height: normal; text-align: right; border-bottom: black 2.5pt double; font-size-adjust: none; font-stretch: normal">(17,741</td> <td style="line-height: normal; text-align: left; padding-bottom: 2.5pt; font-size-adjust: none; font-stretch: normal">)</td> <td style="line-height: normal; padding-bottom: 2.5pt; font-size-adjust: none; font-stretch: normal"> </td> <td style="line-height: normal; text-align: left; border-bottom: black 2.5pt double; font-size-adjust: none; font-stretch: normal">$</td> <td style="line-height: normal; text-align: right; border-bottom: black 2.5pt double; font-size-adjust: none; font-stretch: normal">7,820</td> <td style="line-height: normal; text-align: left; padding-bottom: 2.5pt; font-size-adjust: none; font-stretch: normal"> </td> <td style="line-height: normal; padding-bottom: 2.5pt; font-size-adjust: none; font-stretch: normal"> </td> <td style="line-height: normal; text-align: left; border-bottom: black 2.5pt double; font-size-adjust: none; font-stretch: normal">$</td> <td style="line-height: normal; text-align: right; border-bottom: black 2.5pt double; font-size-adjust: none; font-stretch: normal">(9,921</td> <td style="line-height: normal; text-align: left; padding-bottom: 2.5pt; font-size-adjust: none; font-stretch: normal">)</td></tr> <tr style="vertical-align: bottom; background-color: white"> <td style="line-height: normal; padding-bottom: 2.5pt; font-size-adjust: none; font-stretch: normal">Net loss per common share</td> <td style="line-height: normal; padding-bottom: 2.5pt; font-size-adjust: none; font-stretch: normal"> </td> <td style="line-height: normal; text-align: left; border-bottom: black 2.5pt double; font-size-adjust: none; font-stretch: normal">$</td> <td style="line-height: normal; text-align: right; border-bottom: black 2.5pt double; font-size-adjust: none; font-stretch: normal">(0.00</td> <td style="line-height: normal; text-align: left; padding-bottom: 2.5pt; font-size-adjust: none; font-stretch: normal">)</td> <td style="line-height: normal; padding-bottom: 2.5pt; font-size-adjust: none; font-stretch: normal"> </td> <td style="line-height: normal; text-align: left; border-bottom: black 2.5pt double; font-size-adjust: none; font-stretch: normal">$</td> <td style="line-height: normal; text-align: right; border-bottom: black 2.5pt double; font-size-adjust: none; font-stretch: normal">(0.00</td> <td style="line-height: normal; text-align: left; padding-bottom: 2.5pt; font-size-adjust: none; font-stretch: normal">)</td> <td style="line-height: normal; padding-bottom: 2.5pt; font-size-adjust: none; font-stretch: normal"> </td> <td style="line-height: normal; text-align: left; border-bottom: black 2.5pt double; font-size-adjust: none; font-stretch: normal">$</td> <td style="line-height: normal; text-align: right; border-bottom: black 2.5pt double; font-size-adjust: none; font-stretch: normal">(0.00</td> <td style="line-height: normal; text-align: left; padding-bottom: 2.5pt; font-size-adjust: none; font-stretch: normal">)</td></tr> </table>

Future minimum purchase amounts under the International Distribution Agreement at December 31, 2015 are as follows: <table cellspacing="0" cellpadding="0" style="font: 10pt/normal Times New Roman, Times, Serif; width: 100%; border-collapse: collapse; font-size-adjust: none; font-stretch: normal"> <tr style="vertical-align: bottom"> <td colspan="3" style="line-height: normal; text-align: center; border-bottom: black 1pt solid; font-size-adjust: none; font-stretch: normal">Years ending December 31,</td> <td style="line-height: normal; padding-bottom: 1pt; font-size-adjust: none; font-stretch: normal"> </td> <td colspan="3" style="line-height: normal; text-align: center; border-bottom: black 1pt solid; font-size-adjust: none; font-stretch: normal">Amount</td></tr> <tr style="vertical-align: bottom; background-color: rgb(204, 238, 255)"> <td style="line-height: normal; width: 1%; text-align: left; font-size-adjust: none; font-stretch: normal"> </td> <td style="line-height: normal; width: 43%; text-align: center; font-size-adjust: none; font-stretch: normal">2016</td> <td style="line-height: normal; width: 1%; text-align: left; font-size-adjust: none; font-stretch: normal"> </td> <td style="line-height: normal; width: 10%; font-size-adjust: none; font-stretch: normal"> </td> <td style="line-height: normal; width: 1%; text-align: left; font-size-adjust: none; font-stretch: normal">$</td> <td style="line-height: normal; width: 43%; text-align: right; font-size-adjust: none; font-stretch: normal">1,000,000</td> <td style="line-height: normal; width: 1%; text-align: left; font-size-adjust: none; font-stretch: normal"> </td></tr> <tr style="vertical-align: bottom; background-color: white"> <td style="line-height: normal; text-align: left; font-size-adjust: none; font-stretch: normal"> </td> <td style="line-height: normal; text-align: center; font-size-adjust: none; font-stretch: normal">2017</td> <td style="line-height: normal; text-align: left; font-size-adjust: none; font-stretch: normal"> </td> <td style="line-height: normal; font-size-adjust: none; font-stretch: normal"> </td> <td style="line-height: normal; text-align: left; font-size-adjust: none; font-stretch: normal"> </td> <td style="line-height: normal; text-align: right; font-size-adjust: none; font-stretch: normal">1,500,000</td> <td style="line-height: normal; text-align: left; font-size-adjust: none; font-stretch: normal"> </td></tr> <tr style="vertical-align: bottom; background-color: rgb(204, 238, 255)"> <td style="line-height: normal; text-align: left; font-size-adjust: none; font-stretch: normal"> </td> <td style="line-height: normal; text-align: center; font-size-adjust: none; font-stretch: normal">2018</td> <td style="line-height: normal; text-align: left; padding-bottom: 1pt; font-size-adjust: none; font-stretch: normal"> </td> <td style="line-height: normal; padding-bottom: 1pt; font-size-adjust: none; font-stretch: normal"> </td> <td style="line-height: normal; text-align: left; border-bottom: black 1pt solid; font-size-adjust: none; font-stretch: normal"> </td> <td style="line-height: normal; text-align: right; border-bottom: black 1pt solid; font-size-adjust: none; font-stretch: normal">2,500,000</td> <td style="line-height: normal; text-align: left; padding-bottom: 1pt; font-size-adjust: none; font-stretch: normal"> </td></tr> <tr style="vertical-align: bottom; background-color: white"> <td style="line-height: normal; text-align: left; font-size-adjust: none; font-stretch: normal"> </td> <td style="line-height: normal; text-align: left; font-size-adjust: none; font-stretch: normal">Total minimum purchase amounts</td> <td style="line-height: normal; text-align: left; padding-bottom: 2.5pt; font-size-adjust: none; font-stretch: normal"> </td> <td style="line-height: normal; padding-bottom: 2.5pt; font-size-adjust: none; font-stretch: normal"> </td> <td style="line-height: normal; text-align: left; border-bottom: black 2.5pt double; font-size-adjust: none; font-stretch: normal">$</td> <td style="line-height: normal; text-align: right; border-bottom: black 2.5pt double; font-size-adjust: none; font-stretch: normal">5,000,000</td> <td style="line-height: normal; text-align: left; padding-bottom: 2.5pt; font-size-adjust: none; font-stretch: normal"> </td></tr> </table>

1.00

11760542

0.984

195607

30000

1-for-500

92416

27750

126018

20000

10000

230000

The notes were non-interest bearing, unsecured and were due on demand.

The notes are convertible into shares of stock of the Company at the market price on the date of conversion.

The Lender is entitled, at their option, at any time after the eighth month anniversary of these Convertible Note, to convert all or any lesser portion of the outstanding principal amount and accrued but unpaid interest into the Companys common stock. The conversion price shall equal $0.50 per share (the "Fixed Conversion Price") provided, however that from and after the occurrence of any event of default, as defined, the conversion price shall be the lower of: (i) the Fixed Conversion Price or (ii) 50% multiplied by the lowest sales price of the common stock in a public market during the ten consecutive Trading Day period immediately preceding the Trading Day that the Company receives a notice of conversion.

10000

4000000

0.0025

0.225

0.90

0.40

0.070

200000 0.15 30000

10000

190000

The unpaid principal and interest is secured by the Companys common stock.

50555

It is payable in monthly installments of $50,555 commencing April 28, 2016 through August 28, 2016.

Any amount of principal or interest on this Convertible Note, which is not paid by the due dates, shall bear interest at the rate of 15% per annum from the due date until paid.

73236

50000

1000000

10725

The preferred stock is not convertible into any other class or series of stock.

On all matters to come before the shareholders of the Company, the holders of Series A Preferred shall have that number of votes per share (rounded to the nearest whole share) equal to the product of (x) the number of shares of Series A Preferred held on the record date for the determination of the holders of the shares entitled to vote (the Record Date), or, if no record date is established, at the date such vote is taken or any written consent of shareholders is first solicited, and (y) 50. In the event that the votes by the holders of the Series A Preferred Stock do not total at least 51% of the votes of all classes of the Companys authorized capital stock entitled to vote, then regardless of the provisions of this paragraph, in any such case, the votes cast by a majority of the holders of the Series A Preferred Stock shall be deemed to equal 51% of all votes cast at any meeting of stockholders, or any issue put to the stockholders for voting and the Company may state that any such action approved by at least a majority of the holders of the Series A Preferred Stock was had by majority vote of the holders of all classes of the Companys capital stock.

16667

15000

30000

40000

70000

130000

28000

52000

1200000

200000

280000

0.10

0.462

0.102

0.105

0.255

0.889

0.229

0.143

0.230

0.138

0.149

5000

28000

5000000

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Document and Entity Information - shares	6 Months Ended
Document and Entity Information - shares	Jun. 30, 2016	Sep. 29, 2016
Document And Entity Information
Entity Registrant Name	PETRONE WORLDWIDE, INC.
Entity Central Index Key	0001096132
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?	Yes
Entity Filer Category	Smaller Reporting Company
Entity Common Stock, Shares Outstanding		22,899,897
Document Fiscal Period Focus	Q2
Document Fiscal Year Focus	2016

XML 12 R2.htm IDEA: XBRL DOCUMENT

Consolidated Balance Sheets (Unaudited) - USD ($)	Jun. 30, 2016	Dec. 31, 2015
CURRENT ASSETS:
Cash	$ 46,788	$ 208,064
Accounts receivable	16,977
Prepaid expenses and other current assets	29,897	131,046
Advances to supplier	109,134	11,262
Total Current Assets	202,796	350,372
TOTAL ASSETS	202,796	350,372
CURRENT LIABILITIES:
Convertible notes payable, net	90,514	129,187
Accounts payable	9,729	45,174
Accrued expenses	2,902	405
Due to related party	2,555	38,434
Derivative liability	4,950	73,236
Total Current Liabilities	110,650	286,436
Total Liabilities	110,650	286,436
STOCKHOLDERS' EQUITY:
Preferred stock, $.001 par value, 10,000,000 shares authorized; Series A preferred stock: $.001 par value; 1,000,000 shares authorized; 1,000,000 and 0 shares issued and outstanding at June 30, 2016 and December 31, 2015, respectively	1,000
Common stock: $.001 par value, 100,000,000 shares authorized; 22,769,897 and 21,483,230 issued and outstanding at June 30, 2016 and December 31, 2015, respectively	22,770	21,483
Additional paid-in capital	3,257,058	2,722,559
Accumulated deficit	(3,188,682)	(2,680,106)
Total Stockholders' Equity	92,146	63,936
Total Liabilities and Stockholders' Equity	202,796	350,372
Series A Preferred Stock [Member]
STOCKHOLDERS' EQUITY:
Preferred stock, $.001 par value, 10,000,000 shares authorized; Series A preferred stock: $.001 par value; 1,000,000 shares authorized; 1,000,000 and 0 shares issued and outstanding at June 30, 2016 and December 31, 2015, respectively	1,000
Total Stockholders' Equity	1,000
Total Liabilities and Stockholders' Equity	$ 1,000

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Consolidated Balance Sheets (Unaudited) (Parenthetical) - $ / shares	Jun. 30, 2016	Dec. 31, 2015
Preferred stock, par value per share	$ 0.001	$ 0.001
Preferred stock, shares authorized	10,000,000	10,000,000
Preferred stock, shares issued	1,000,000	0
Preferred stock, shares outstanding	1,000,000	0
Common stock, par value per share	$ .001	$ .001
Common stock, shares authorized	100,000,000	100,000,000
Common stock, shares issued	22,769,897	21,483,230
Common stock, shares outstanding	22,769,897	21,483,230
Series A Preferred Stock [Member]
Preferred stock, par value per share	$ 0.001	$ 0.001
Preferred stock, shares authorized	1,000,000	1,000,000
Preferred stock, shares issued	1,000,000	0
Preferred stock, shares outstanding	1,000,000	0

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Consolidated Statements Of Operations (Unaudited) - USD ($)	3 Months Ended		6 Months Ended
	Jun. 30, 2016	Jun. 30, 2015	Jun. 30, 2016	Jun. 30, 2015
REVENUES	$ 63,808		$ 171,429
COST OF REVENUES	58,626		133,896
GROSS PROFIT	5,182		37,533
OPERATING EXPENSES:
Compensation and related benefits	32,000		33,000
Consulting fees	64,574		144,340
Professional fees	33,388		98,804
Rent expense	13,059		35,216
General and administrative expenses	50,946		144,616
Total Operating Expenses	193,967		455,976
LOSS FROM OPERATIONS	(188,785)		(418,443)
OTHER EXPENSES:
Interest expenses	87,525		145,633
Gain on derivative liability	14,693		55,500
Total Other Expense	(72,832)		(90,133)
NET LOSS	$ (261,617)		$ (508,576)
NET LOSS PER COMMON SHARE: Basic and diluted	$ (0.01)		$ (0.02)
WEIGHTED AVERAGE COMMON SHARES OUTSTANDING: Basic and diluted	22,733,853		22,485,739
As Restated [Member]
REVENUES		$ 574,596		$ 1,349,090
COST OF REVENUES		488,375		1,242,904
GROSS PROFIT		86,221		106,186
OPERATING EXPENSES:
Compensation and related benefits		2,600		12,600
Consulting fees		28,526		36,248
Professional fees		21,524		29,709
Rent expense		13,504		48,623
General and administrative expenses		29,941		68,184
Total Operating Expenses		96,095		195,364
LOSS FROM OPERATIONS		(9,874)		(89,178)
OTHER EXPENSES:
Interest expenses		47		47
Gain on derivative liability
Total Other Expense		(47)		(47)
NET LOSS		$ (9,921)		$ (89,225)
NET LOSS PER COMMON SHARE: Basic and diluted		$ (0.00)		$ (0.01)
WEIGHTED AVERAGE COMMON SHARES OUTSTANDING: Basic and diluted		15,643,535		15,459,938

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Consolidated Statements Of Cash Flows (Unaudited) - USD ($)	6 Months Ended
	Jun. 30, 2016	Jun. 30, 2015
CASH FLOWS FROM OPERATING ACTIVITIES
Net loss	$ (508,576)
Adjustments to reconcile net loss to net cash used in operating activities:
Amortization of debt discount to interest expense	92,971
Stock-based compensation	117,149
Gain on derivative liability	55,500
Stock-based interest expense for debt modification	28,000
Change in operating assets and liabilities:
Accounts receivable	16,977
Prepaid expenses and other current assets
Advances to supplier	97,872
Accounts payable	(35,445)
Accrued expenses	2,497
Advances from customers
NET CASH USED IN OPERATING ACTIVITIES	(473,753)
CASH FLOWS FROM FINANCING ACTIVITIES
Repayment of related party advances	35,879
Repayment of convertible debt	131,644
Proceeds from sale of common stock	480,000
NET CASH PROVIDED BY FINANCING ACTIVITIES	312,477
NET DECREASE IN CASH	(161,276)
CASH, beginning of period	208,064
CASH, end of period	46,788
SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION
Cash paid for: Interest	50,122
Cash paid for: Income taxes
SUPPLEMENTAL DISCLOSURE OF NON-CASH INVESTING AND FINANCING ACTIVITIES:
Reclassification of derivative liability to equity	12,786
Unearned common stock issued for services
Exchange of related party advances for accounts payable
As Restated [Member]
CASH FLOWS FROM OPERATING ACTIVITIES
Net loss		$ (89,225)
Adjustments to reconcile net loss to net cash used in operating activities:
Amortization of debt discount to interest expense
Stock-based compensation		36,248
Gain on derivative liability
Stock-based interest expense for debt modification
Change in operating assets and liabilities:
Accounts receivable		594
Prepaid expenses and other current assets		(8,262)
Advances to supplier		9,764
Accounts payable		(1,105)
Accrued expenses		(9,813)
Advances from customers		6,568
NET CASH USED IN OPERATING ACTIVITIES		(59,423)
CASH FLOWS FROM FINANCING ACTIVITIES
Repayment of related party advances		983
Repayment of convertible debt
Proceeds from sale of common stock		5,000
NET CASH PROVIDED BY FINANCING ACTIVITIES		4,017
NET DECREASE IN CASH		(55,406)
CASH, beginning of period		77,827
CASH, end of period		22,421
SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION
Cash paid for: Interest
Cash paid for: Income taxes
SUPPLEMENTAL DISCLOSURE OF NON-CASH INVESTING AND FINANCING ACTIVITIES:
Reclassification of derivative liability to equity
Unearned common stock issued for services		108,000
Exchange of related party advances for accounts payable		$ 800

XML 16 R6.htm IDEA: XBRL DOCUMENT

Organization And Basis Of Presentation

6 Months Ended

Jun. 30, 2016

Accounting Policies [Abstract]

Organization and Basis of Presentation

NOTE 1 – ORGANIZATION AND BASIS OF PRESENTATION

Organization

The Company is in the hospitality industry and is a supplier of tabletop kitchenware and hotel room products thru an exclusive licensing agreement with a leading supplier.

Basis of Presentation and Principles of Consolidation

Going concern

XML 17 R7.htm IDEA: XBRL DOCUMENT

Summary Of Significant Accounting Policies

6 Months Ended

Jun. 30, 2016

Accounting Policies [Abstract]

Summary of Significant Accounting Policies

NOTE 2 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Use of estimates

Fair value of financial instruments and fair value measurements

Level 1- Inputs are unadjusted quoted prices in active markets for identical assets or liabilities available at the measurement date.

	At June 30, 2016					At December 31, 2015
Description		Level 1	Level 2		Level 3		Level 1	Level 2		Level 3
Derivative liability		—	—	$	4,950		—	—	$	73,236

A roll forward of the level 3 valuation financial instruments is as follows:

		Derivative Liability
Balance at December 31, 2015	$	73,236
Reclassification of derivative liability to equity		(12,786	)
Change in fair value included in net loss		(55,500	)
Balance at June 30, 2016	$	4,950

Cash and cash equivalents

Accounts receivable

Advances to Supplier

Advances to supplier represent the advance payments for the purchase of product from supplier.

Impairment of long-lived assets

Derivative liabilities

Revenue recognition

Cost of sales

Cost of sales includes inventory costs, materials and supplies costs, and shipping and handling costs incurred.

Shipping and handling costs

Advertising costs

All costs related to advertising of the Company’s products are expensed in the period incurred.

Income taxes

Stock-based compensation

Loss per share of common stock

		June 30, 2016				June 30, 2015
Convertible notes			449,523				30,612

Recent accounting pronouncements

There are no other recently issued accounting standards that apply to us or that are expected to have a material impact on our results of operations, financial condition, or cash flows.

XML 18 R8.htm IDEA: XBRL DOCUMENT

Convertible Notes

6 Months Ended

Jun. 30, 2016

Debt Disclosure [Abstract]

Convertible Notes

NOTE 3 – CONVERTIBLE NOTES

At June 30, 2016, and December 31, 2015, the fair value of the derivative liabilities was estimated using the Black-scholes option-pricing model with the following assumptions:

	June 30, 2016			December 31, 2015
Dividend rate		0			0
Term (in years)		0.41 to 0.125 years			0.67 years
Volatility		100.0	%		100.0	%
Risk-free interest rate		0.26% to 0.39%			0.66	%

At June 30, 2016 and December 31, 2015, convertible promissory notes consisted of the following:

	June 30, 2016			December 31, 2015
Principal amount	$	118,356		$	250,000
Less: unamortized debt discount		(27,842	)		(120,813	)
Convertible notes payable, net	$	90,514		$	129,187

XML 19 R9.htm IDEA: XBRL DOCUMENT

Related Party Transactions

6 Months Ended

Jun. 30, 2016

Related Party Transactions

Related Party Transactions

NOTE 4 – RELATED PARTY TRANSACTIONS

	Six Months ended June 30, 2016			Six Months ended June 30, 2015
Balance due to related party at beginning of period	$	38,434		$	8,051
Working capital advances received		—			800
Repayments made and conversions		(35,879	)		(983	)
Balance due to related party at end of period	$	2,555		$	7,868

XML 20 R10.htm IDEA: XBRL DOCUMENT

Stockholders' Equity

6 Months Ended

Jun. 30, 2016

Equity [Abstract]

Stockholders' Equity

NOTE 5 - STOCKHOLDERS’ EQUITY

Preferred stock

Common stock issued for services

Additionally, for the six months ended June 30, 2016 and 2015, amortization of prepaid stock-based consulting fees amounted to $117,149 and $36,248, respectively.

Common shares issued in connection with debt addendum

Common stock issued for cash

- Definition

The entire disclosure for shareholders' equity comprised of portions attributable to the parent entity and noncontrolling interest, including other comprehensive income. Includes, but is not limited to, balances of common stock, preferred stock, additional paid-in capital, other capital and retained earnings, accumulated balance for each classification of other comprehensive income and amount of comprehensive income.

+ References

Reference 1: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 310
-SubTopic 10
-Section S99
-Paragraph 4
-Subparagraph (SAB Topic 4.E)
-URI http://asc.fasb.org/extlink&oid=27010918&loc=d3e74567-122707

Reference 2: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 505
-SubTopic 10
-Section 50
-Paragraph 4
-URI http://asc.fasb.org/extlink&oid=6928386&loc=d3e21484-112644

Reference 3: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 210
-SubTopic 10
-Section S99
-Paragraph 1
-Subparagraph (SX 210.5-02(29))
-URI http://asc.fasb.org/extlink&oid=6877327&loc=d3e13212-122682

Reference 4: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 505
-SubTopic 10
-Section 50
-Paragraph 5
-URI http://asc.fasb.org/extlink&oid=6928386&loc=d3e21488-112644

Reference 5: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 235
-SubTopic 10
-Section S99
-Paragraph 1
-Subparagraph (SX 210.4-08(e))
-URI http://asc.fasb.org/extlink&oid=26873400&loc=d3e23780-122690

Reference 6: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 210
-SubTopic 10
-Section S99
-Paragraph 1
-Subparagraph (SX 210.5-02(31))
-URI http://asc.fasb.org/extlink&oid=6877327&loc=d3e13212-122682

Reference 7: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 505
-SubTopic 10
-Section S99
-Paragraph 4
-Subparagraph (SAB Topic 4.C)
-URI http://asc.fasb.org/extlink&oid=27012166&loc=d3e187143-122770

Reference 8: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 210
-SubTopic 10
-Section S99
-Paragraph 1
-Subparagraph (SX 210.5-02(30))
-URI http://asc.fasb.org/extlink&oid=6877327&loc=d3e13212-122682

Reference 9: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 505
-SubTopic 10
-Section 50
-Paragraph 6
-URI http://asc.fasb.org/extlink&oid=6928386&loc=d3e21506-112644

Reference 10: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 235
-SubTopic 10
-Section S99
-Paragraph 1
-Subparagraph (SX 210.4-08(d))
-URI http://asc.fasb.org/extlink&oid=26873400&loc=d3e23780-122690

Reference 11: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 505
-SubTopic 10
-Section S99
-Paragraph 1
-Subparagraph (SX 210.3-04)
-URI http://asc.fasb.org/extlink&oid=27012166&loc=d3e187085-122770

Reference 12: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 505
-SubTopic 30
-Section 50
-Paragraph 2
-URI http://asc.fasb.org/extlink&oid=6405834&loc=d3e23285-112656

Reference 13: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 505
-SubTopic 10
-Section 50
-Paragraph 3
-URI http://asc.fasb.org/extlink&oid=6928386&loc=d3e21475-112644

Reference 14: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Glossary Preferred Stock
-URI http://asc.fasb.org/extlink&oid=6521494

Reference 15: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 505
-SubTopic 10
-Section 50
-Paragraph 2
-URI http://asc.fasb.org/extlink&oid=6928386&loc=d3e21463-112644

Reference 16: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 505
-SubTopic 10
-Section 50
-Paragraph 11
-URI http://asc.fasb.org/extlink&oid=6928386&loc=d3e21564-112644

+ Details

XML 21 R11.htm IDEA: XBRL DOCUMENT

Commitments

6 Months Ended

Jun. 30, 2016

Commitments

Commitments

NOTE 6 – COMMITMENTS

International distribution agreement

Years ending December 31,		Amount
	2016	$	1,000,000
	2017		1,500,000
	2018		2,500,000
	Total minimum purchase amounts	$	5,000,000

XML 22 R12.htm IDEA: XBRL DOCUMENT

Concentrations

6 Months Ended

Jun. 30, 2016

Concentrations

Concentrations

NOTE 7 – CONCENTRATIONS

Concentrations of credit risk

Geographic concentrations of sales

Customer concentrations

Vendor concentrations

XML 23 R13.htm IDEA: XBRL DOCUMENT

Restatement Of 2015 Periods

6 Months Ended

Jun. 30, 2016

Restatement Of 2015 Periods

Restatement of 2015 Periods

NOTE 8 – RESTATEMENT OF 2015 PERIODS

Consolidated Statement of operations	For the Six Months Ended June 30, 2015 (Unaudited)
	As previously reported			Adjustments to Restate			As Restated
Revenues	$	1,341,890		$	7,200		$	1,349,090
Cost of revenues		1,185,340			57,564			1,242,904
Gross profit		156,550			(50,364	)		106,186
Operating expenses		217,711			(22,347	)		195,364
Loss from operations		(61,161	)		(28,017	)		(89,178	)
Other expenses		—			(47	)		(47	)
Net loss	$	(61,161	)	$	(28,064	)	$	(89,225	)
Net loss per common share	$	(0.00	)	$	(0.00	)	$	(0.01	)

Consolidated Statement of operations	For the Three Months Ended June 30, 2015 (Unaudited)
	As previously reported			Adjustments to Restate			As Restated
Revenues	$	557,348		$	17,248		$	574,596
Cost of revenues		469,489			18,886			488,375
Gross profit		87,859			(1,638	)		86,221
Operating expenses		105,600			(9,505	)		96,095
Loss from operations		(17,741	)		7,867			(9,874	)
Other expenses		—			(47	)		(47	)
Net loss	$	(17,741	)	$	7,820		$	(9,921	)
Net loss per common share	$	(0.00	)	$	(0.00	)	$	(0.00	)

- Definition

The entire disclosure for reporting accounting changes and error corrections. It includes the conveyance of information necessary for a user of the Company's financial information to understand all aspects and required disclosure information concerning all changes and error corrections reported in the Company's financial statements for the period.

+ References + Details

XML 24 R14.htm IDEA: XBRL DOCUMENT

Subsequent Events

6 Months Ended

Jun. 30, 2016

Subsequent Events [Abstract]

Subsequent Events

NOTE 9 - SUBSEQUENT EVENTS

XML 25 R15.htm IDEA: XBRL DOCUMENT

Summary Of Significant Accounting Policies (Policies)

6 Months Ended

Jun. 30, 2016

Summary Of Significant Accounting Policies Policies

Use of Estimates

Use of estimates

Fair Value of Financial Instruments and Fair Value Measurements

Fair value of financial instruments and fair value measurements

Level 1- Inputs are unadjusted quoted prices in active markets for identical assets or liabilities available at the measurement date.

	At June 30, 2016					At December 31, 2015
Description		Level 1	Level 2		Level 3		Level 1	Level 2		Level 3
Derivative liability		—	—	$	4,950		—	—	$	73,236

A roll forward of the level 3 valuation financial instruments is as follows:

		Derivative Liability
Balance at December 31, 2015	$	73,236
Reclassification of derivative liability to equity		(12,786	)
Change in fair value included in net loss		(55,500	)
Balance at June 30, 2016	$	4,950

Cash and Cash Equivalents

Cash and cash equivalents

Accounts Receivable

Accounts receivable

Advances to Supplier

Advances to Supplier

Advances to supplier represent the advance payments for the purchase of product from supplier.

Impairment of Long-Lived Assets

Impairment of long-lived assets

Derivative Liabilities

Derivative liabilities

Revenue Recognition

Revenue recognition

Cost of Sales

Cost of sales

Cost of sales includes inventory costs, materials and supplies costs, and shipping and handling costs incurred.

Shipping and Handling Costs

Shipping and handling costs

Advertising Costs

Advertising costs

All costs related to advertising of the Company’s products are expensed in the period incurred.

Income Taxes

Income taxes

Stock-Based Compensation

Stock-based compensation

Loss Per Share of Common Stock

Loss per share of common stock

		June 30, 2016				June 30, 2015
Convertible notes			449,523				30,612

Recent Accounting Pronouncements

Recent accounting pronouncements

There are no other recently issued accounting standards that apply to us or that are expected to have a material impact on our results of operations, financial condition, or cash flows.

XML 26 R16.htm IDEA: XBRL DOCUMENT

Summary Of Significant Accounting Policies (Tables)

6 Months Ended

Jun. 30, 2016

Summary Of Significant Accounting Policies Tables

Schedule of Fair Value Hierarchy for Financial Liabilites

The Company accounts for one instrument at fair value using level 3 valuation.

	At June 30, 2016					At December 31, 2015
Description		Level 1	Level 2		Level 3		Level 1	Level 2		Level 3
Derivative liability		—	—	$	4,950		—	—	$	73,236

Schedule of Roll Forward Valuation of Derivative Liability

A roll forward of the level 3 valuation financial instruments is as follows:

		Derivative Liability
Balance at December 31, 2015	$	73,236
Reclassification of derivative liability to equity		(12,786	)
Change in fair value included in net loss		(55,500	)
Balance at June 30, 2016	$	4,950

Schedule of Computation of Earnings Per Share

Potentially dilutive common shares were excluded from the computation of diluted shares outstanding as they would have an anti-dilutive impact on the Company’s net losses and consisted of the following:

		June 30, 2016				June 30, 2015
Convertible notes			449,523				30,612

XML 27 R17.htm IDEA: XBRL DOCUMENT

Convertible Notes (Tables)

6 Months Ended

Jun. 30, 2016

Convertible Notes Tables

Schedule of Assumptions Used in Valuation of Derivatives

At June 30, 2016, and December 31, 2015, the fair value of the derivative liabilities was estimated using the Black-scholes option-pricing model with the following assumptions:

	June 30, 2016			December 31, 2015
Dividend rate		0			0
Term (in years)		0.41 to 0.125 years			0.67 years
Volatility		100.0	%		100.0	%
Risk-free interest rate		0.26% to 0.39%			0.66	%

Schedule of Convertible Promissory Notes

At June 30, 2016 and December 31, 2015, convertible promissory notes consisted of the following:

	June 30, 2016			December 31, 2015
Principal amount	$	118,356		$	250,000
Less: unamortized debt discount		(27,842	)		(120,813	)
Convertible notes payable, net	$	90,514		$	129,187

XML 28 R18.htm IDEA: XBRL DOCUMENT

Related Party Transactions (Tables)

6 Months Ended

Jun. 30, 2016

Related Party Transactions Tables

Schedule of Due to Related Party Activity

For the six months ended June 30, 2016 and 2015, due to related party activity consisted of the following:

	Six Months ended June 30, 2016			Six Months ended June 30, 2015
Balance due to related party at beginning of period	$	38,434		$	8,051
Working capital advances received		—			800
Repayments made and conversions		(35,879	)		(983	)
Balance due to related party at end of period	$	2,555		$	7,868

XML 29 R19.htm IDEA: XBRL DOCUMENT

Commitments (Tables)

6 Months Ended

Jun. 30, 2016

Commitments Tables

Schedule of Future Minimum Purchase Amounts

Future minimum purchase amounts under the International Distribution Agreement at December 31, 2015 are as follows:

Years ending December 31,		Amount
	2016	$	1,000,000
	2017		1,500,000
	2018		2,500,000
	Total minimum purchase amounts	$	5,000,000

XML 30 R20.htm IDEA: XBRL DOCUMENT

Restatement Of 2015 Periods (Tables)

6 Months Ended

Jun. 30, 2016

Restatement Of 2015 Periods Tables

Schedule of Company's Consolidated Statement of Operations

The effect of correcting these errors in the Company’s unaudited consolidated financial statements for the three and six months ended June 30, 2015 are shown in the table as follows:

Consolidated Statement of operations	For the Six Months Ended June 30, 2015 (Unaudited)
	As previously reported			Adjustments to Restate			As Restated
Revenues	$	1,341,890		$	7,200		$	1,349,090
Cost of revenues		1,185,340			57,564			1,242,904
Gross profit		156,550			(50,364	)		106,186
Operating expenses		217,711			(22,347	)		195,364
Loss from operations		(61,161	)		(28,017	)		(89,178	)
Other expenses		—			(47	)		(47	)
Net loss	$	(61,161	)	$	(28,064	)	$	(89,225	)
Net loss per common share	$	(0.00	)	$	(0.00	)	$	(0.01	)

Consolidated Statement of operations	For the Three Months Ended June 30, 2015 (Unaudited)
	As previously reported			Adjustments to Restate			As Restated
Revenues	$	557,348		$	17,248		$	574,596
Cost of revenues		469,489			18,886			488,375
Gross profit		87,859			(1,638	)		86,221
Operating expenses		105,600			(9,505	)		96,095
Loss from operations		(17,741	)		7,867			(9,874	)
Other expenses		—			(47	)		(47	)
Net loss	$	(17,741	)	$	7,820		$	(9,921	)
Net loss per common share	$	(0.00	)	$	(0.00	)	$	(0.00	)

XML 31 R21.htm IDEA: XBRL DOCUMENT

Summary Of Significant Accounting Policies (Schedule Of Fair Value Hierarchy For Financial Liabilites) (Details) - USD ($)	Jun. 30, 2016	Dec. 31, 2015
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Derivative liability	$ 4,950	$ 73,236
Level 1 [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Derivative liability
Level 2 [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Derivative liability
Level 3 [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Derivative liability	$ 4,950	$ 73,236

- Definition

Fair value, after the effects of master netting arrangements, of a financial liability or contract with one or more underlyings, notional amount or payment provision or both, and the contract can be net settled by means outside the contract or delivery of an asset, expected to be settled within one year or normal operating cycle, if longer. Includes assets not subject to a master netting arrangement and not elected to be offset.

+ References + Details

XML 32 R22.htm IDEA: XBRL DOCUMENT

Summary Of Significant Accounting Policies (Schedule Of Roll Forward Valuation Of Derivative Liability) (Details) - Derivative Liability [Member]	6 Months Ended
	Jun. 30, 2016 USD ($)
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items]
Balance at December 31, 2015	$ 73,236
Reclassification of derivative liability to equity	12,786
Change in fair value included in net loss	(55,500)
Balance at June 30, 2016	$ 4,950

XML 33 R23.htm IDEA: XBRL DOCUMENT

Summary Of Significant Accounting Policies (Schedule Of Computation Of Earnings Per Share) (Details) - shares	6 Months Ended
	Jun. 30, 2016	Jun. 30, 2015
Convertible Notes [Member]
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Antidilutive securities excluded from computation of earnings per share	449,523	30,612

XML 34 R24.htm IDEA: XBRL DOCUMENT

Convertible Notes (Schedule Of Assumptions Used In Valuation Of Derivatives) (Details) - Derivative Liability [Member]	6 Months Ended	12 Months Ended
	Jun. 30, 2016	Dec. 31, 2015
Assumptions Used in Valuation of Derivatives - Black Scholes Option Pricing Model:
Dividend rate	0.00%	0.00%
Term (in years)		8 months 1 day
Volatility	100.00%	100.00%
Risk-free interest rate		0.66%
Minimum [Member]
Assumptions Used in Valuation of Derivatives - Black Scholes Option Pricing Model:
Term (in years)	1 month 15 days
Risk-free interest rate	0.26%
Maximum [Member]
Assumptions Used in Valuation of Derivatives - Black Scholes Option Pricing Model:
Term (in years)	4 months 28 days
Risk-free interest rate	0.39%

XML 35 R25.htm IDEA: XBRL DOCUMENT

Convertible Notes (Schedule Of Convertible Promissory Notes) (Details) - USD ($)	Jun. 30, 2016	Dec. 31, 2015
Short-term Debt [Line Items]
Convertible notes payable, net	$ 90,514	$ 129,187
Convertible Promissory Notes [Member]
Short-term Debt [Line Items]
Principal amount	118,356	250,000
Less: unamortized debt discount	27,842	120,813
Convertible notes payable, net	$ 90,514	$ 129,187

XML 36 R26.htm IDEA: XBRL DOCUMENT

Related Party Transactions (Details) - USD ($)	6 Months Ended
Related Party Transactions (Details) - USD ($)	Jun. 30, 2016	Jun. 30, 2015
Related Party Transaction [Line Items]
Balance due to related party at beginning of period	$ 38,434
Balance due to related party at end of period	2,555
Chief Executive Officer [Member]
Related Party Transaction [Line Items]
Balance due to related party at beginning of period	38,434	$ 8,051
Working capital advances received		800
Repayments made and conversions	(35,879)	(983)
Balance due to related party at end of period	$ 2,555	$ 7,868

XML 37 R27.htm IDEA: XBRL DOCUMENT

Commitments (Details) - International distribution agreement with major supplier	Dec. 31, 2015 USD ($)
Years ending December 31,
2016	$ 1,000,000
2017	1,500,000
2018	2,500,000
Total minimum purchase amounts	$ 5,000,000

XML 38 R28.htm IDEA: XBRL DOCUMENT

Restatement Of 2015 Periods (Details) - USD ($)	3 Months Ended		6 Months Ended
Restatement Of 2015 Periods (Details) - USD ($)	Jun. 30, 2016	Jun. 30, 2015	Jun. 30, 2016	Jun. 30, 2015
Revenues	$ 63,808		$ 171,429
Cost of revenues	58,626		133,896
Gross profit	5,182		37,533
Operating expenses	193,967		455,976
Loss from operations	(188,785)		(418,443)
Other expenses	(72,832)		(90,133)
Net loss	$ (261,617)		$ (508,576)
Net loss per common share	$ (0.01)		$ (0.02)
As Previously Reported [Member]
Revenues		$ 557,348		$ 1,341,890
Cost of revenues		469,489		1,185,340
Gross profit		87,859		156,550
Operating expenses		105,600		217,711
Loss from operations		(17,741)		(61,161)
Other expenses
Net loss		$ (17,741)		$ (61,161)
Net loss per common share		$ (0.00)		$ (0.00)
Adjustments To Restate [Member]
Revenues		$ 17,248		$ 7,200
Cost of revenues		18,886		57,564
Gross profit		(1,638)		(50,364)
Operating expenses		(9,505)		(22,347)
Loss from operations		7,867		(28,017)
Other expenses		(47)		(47)
Net loss		$ 7,820		$ (28,064)
Net loss per common share		$ (0.00)		$ (0.00)
As Restated [Member]
Revenues		$ 574,596		$ 1,349,090
Cost of revenues		488,375		1,242,904
Gross profit		86,221		106,186
Operating expenses		96,095		195,364
Loss from operations		(9,874)		(89,178)
Other expenses		(47)		(47)
Net loss		$ (9,921)		$ (89,225)
Net loss per common share		$ (0.00)		$ (0.01)

XML 39 R29.htm IDEA: XBRL DOCUMENT

Organization And Basis Of Presentation (Narrative) (Details) - USD ($)	1 Months Ended
	Mar. 03, 2014	Feb. 28, 2014	Jun. 30, 2016
Working capital deficit			$ 92,416
Common Stock [Member]
Reverse stock split		1-for-500
Purchase Agreement With Petrone Food Works, Inc. (PFW) And Shareholder Of PFW [Member]
Acquisition percentage of PFW’s issued and outstanding common stock from the PFW shareholder	100.00%
Liabilities assumed in connection with purchase agreement	$ 30,000
Purchase Agreement With Petrone Food Works, Inc. (PFW) And Shareholder Of PFW [Member] \| Common Stock [Member]
Stock issued to PFW for acquisition under purchase agreement	11,760,542
Percentage of outstanding common stock of the company	98.40%
Change in no of shares issued in connection with purchase agreement after reverse stock split	195,607

XML 40 R30.htm IDEA: XBRL DOCUMENT

Summary Of Significant Accounting Policies (Narrative) (Details) - USD ($)	6 Months Ended
	Jun. 30, 2016	Jun. 30, 2015
Cost Of Sales [Member]
Shipping and handling cost	$ 27,750	$ 126,018

XML 41 R31.htm IDEA: XBRL DOCUMENT

Convertible Notes (Narrative) (Details) - USD ($)				1 Months Ended	6 Months Ended		12 Months Ended
Convertible Notes (Narrative) (Details) - USD ($)	Dec. 28, 2015	Dec. 22, 2015	Jul. 01, 2014	Dec. 31, 2015	Jun. 30, 2016	Jun. 30, 2015	Dec. 31, 2013	Jun. 06, 2016	Feb. 03, 2016
Short-term Debt [Line Items]
Convertible notes payable				$ 129,187	$ 90,514
Amortization of debt discount					92,971
Repayment of convertible note payable					131,644
Common Stock [Member]
Short-term Debt [Line Items]
Stock issued for debt conversion, per share									$ 0.40
Convertible Promissory Note Agreement With Individual - 2013 [Member]
Short-term Debt [Line Items]
Convertible notes face value							$ 20,000
Convertible notes description							The notes were non-interest bearing, unsecured and were due on demand.
Convertible notes conversion terms							The notes are convertible into shares of stock of the Company at the market price on the date of conversion.
Convertible notes payable					20,000
Convertible Promissory Note Agreement With Individual - July 01, 2014 [Member]
Short-term Debt [Line Items]
Convertible notes face value			$ 10,000
Convertible notes description			The notes were non-interest bearing, unsecured and were due on demand.
Convertible notes conversion terms			The notes are convertible into shares of stock of the Company at the market price on the date of conversion.
Convertible Promissory Note Agreement With Individual - July 01, 2014 [Member] \| Common Stock [Member]
Short-term Debt [Line Items]
Stock issued for debt conversion, shares		10,000
Stock issued for debt conversion, value		$ 4,000,000
Stock issued for debt conversion, per share		$ 0.0025
Secured Convertible Promissory Note With First Fire Global Opportunities Fund LLC - December 28, 2015 [Member]
Short-term Debt [Line Items]
Convertible notes face value	$ 230,000
Convertible notes conversion terms	The Lender is entitled, at their option, at any time after the eighth month anniversary of these Convertible Note, to convert all or any lesser portion of the outstanding principal amount and accrued but unpaid interest into the Company’s common stock. The conversion price shall equal $0.50 per share (the "Fixed Conversion Price") provided, however that from and after the occurrence of any event of default, as defined, the conversion price shall be the lower of: (i) the Fixed Conversion Price or (ii) 50% multiplied by the lowest sales price of the common stock in a public market during the ten consecutive Trading Day period immediately preceding the Trading Day that the Company receives a notice of conversion.
Convertible notes interest percentage	7.00%
Convertible note purchase price	$ 200,000
Percentage of original issue discount	15.00%
Original issue discount	$ 30,000
Legal fees with related to convertible notes	10,000
Net proceeds from convertible notes	$ 190,000
Convertible notes secured terms	The unpaid principal and interest is secured by the Company’s common stock.
Convertible notes monthly installments	$ 50,555
Convertible notes monthly payment commencing terms	It is payable in monthly installments of $50,555 commencing April 28, 2016 through August 28, 2016.
Convertible notes default terms	Any amount of principal or interest on this Convertible Note, which is not paid by the due dates, shall bear interest at the rate of 15% per annum from the due date until paid.
New derivative liability	$ 73,236
Unamortized debt discount	$ 73,236
Repayment of convertible note payable					131,644
Secured Convertible Promissory Note With First Fire Global Opportunities Fund LLC - December 28, 2015 [Member] \| Common Stock [Member]
Short-term Debt [Line Items]
Stock issued for debt conversion, per share				$ 0.225				$ 0.40
Stock issued for convertible debt issuance costs, shares				50,000
Unamortized debt discount in connection with convertible debt issuance costs				$ 10,725
Convertible Promissory Notes [Member]
Short-term Debt [Line Items]
Convertible notes payable				129,187	90,514
Unamortized debt discount				$ 120,813	27,842
Convertible Promissory Notes [Member] \| Interest Expenses [Member]
Short-term Debt [Line Items]
Amortization of debt discount					$ 92,971	$ 0

XML 42 R32.htm IDEA: XBRL DOCUMENT

Stockholders' Equity (Narrative) (Details) - USD ($)						1 Months Ended			2 Months Ended	3 Months Ended	6 Months Ended
Stockholders' Equity (Narrative) (Details) - USD ($)	Jun. 06, 2016	Apr. 20, 2016	Mar. 16, 2016	Feb. 19, 2016	Feb. 03, 2016	Apr. 30, 2016	Mar. 31, 2016	Dec. 31, 2015	Jun. 06, 2016	Jun. 30, 2016	Jun. 30, 2016	Jun. 30, 2015
Preferred stock, shares authorized								10,000,000		10,000,000	10,000,000
Preferred stock, par value per share								$ 0.001		$ 0.001	$ 0.001
Stock based compensation											$ 117,149
Consulting expenses										$ 64,574	144,340
Subscription receivable collected											480,000
Common Stock [Member]
Share issue price					$ 0.40
Stock issued for cash, shares					1,200,000
Stock issued for cash, value					$ 200,000
Subscription receivable					$ 280,000
Subscription receivable collected						$ 280,000
Common Stock [Member] \| Secured Convertible Promissory Note With First Fire Global Opportunities Fund LLC - December 28, 2015 [Member]
Stock issued to CEO, shares								50,000
Share issue price	$ 0.40							$ 0.225	$ 0.40
Stock issued to lender for failure to file reports with SEC, shares	40,000	30,000							70,000
Stock issued to lender for failure to file reports with SEC, value									$ 28,000
Common Stock [Member] \| Consulting Agreement - Consultant For Investor Relations Services [Member]
Stock issued for services, shares			16,667
Stock issued for services, value			$ 15,000
Share issue price			$ 0.90
Consulting expenses							$ 15,000
Common Stock [Member] \| Consultant - Prepaid Stock Based Consulting Fees [Member]
Consulting expenses											$ 117,149	$ 36,248
Series A Preferred Stock [Member]
Preferred stock, shares authorized				1,000,000				1,000,000		1,000,000	1,000,000
Preferred stock, par value per share				$ 0.001				$ 0.001		$ 0.001	$ 0.001
Preferred stock conversion terms				The preferred stock is not convertible into any other class or series of stock.
Preferred stock voting rights				On all matters to come before the shareholders of the Company, the holders of Series A Preferred shall have that number of votes per share (rounded to the nearest whole share) equal to the product of (x) the number of shares of Series A Preferred held on the record date for the determination of the holders of the shares entitled to vote (the “Record Date”), or, if no record date is established, at the date such vote is taken or any written consent of shareholders is first solicited, and (y) 50. In the event that the votes by the holders of the Series A Preferred Stock do not total at least 51% of the votes of all classes of the Company’s authorized capital stock entitled to vote, then regardless of the provisions of this paragraph, in any such case, the votes cast by a majority of the holders of the Series A Preferred Stock shall be deemed to equal 51% of all votes cast at any meeting of stockholders, or any issue put to the stockholders for voting and the Company may state that any such action approved by at least a majority of the holders of the Series A Preferred Stock was had by majority vote of the holders of all classes of the Company’s capital stock.
Series A Preferred Stock [Member] \| Chief Executive Officer [Member]
Stock issued to CEO, shares				1,000,000
Stock based compensation				$ 1,000

XML 43 R33.htm IDEA: XBRL DOCUMENT

Concentrations (Narrative) (Details) - Total Sales [Member]	6 Months Ended
	Jun. 30, 2016	Jun. 30, 2015
Geographic Concentration Risk - In The United States [Member]
Concentration Risk [Line Items]
Concentration risk percentage	10.00%	10.00%
Customer Concentration Risk [Member] \| Three Customers [Member]
Concentration Risk [Line Items]
Concentration risk percentage	46.20%
Customer Concentration Risk [Member] \| Customer - One [Member]
Concentration Risk [Line Items]
Concentration risk percentage	10.20%	22.90%
Customer Concentration Risk [Member] \| Customer - Two [Member]
Concentration Risk [Line Items]
Concentration risk percentage	10.50%	14.30%
Customer Concentration Risk [Member] \| Customer - Three [Member]
Concentration Risk [Line Items]
Concentration risk percentage	25.50%	23.00%
Customer Concentration Risk [Member] \| Five Customers [Member]
Concentration Risk [Line Items]
Concentration risk percentage		88.90%
Customer Concentration Risk [Member] \| Customer - Four [Member]
Concentration Risk [Line Items]
Concentration risk percentage		13.80%
Customer Concentration Risk [Member] \| Customer - Five [Member]
Concentration Risk [Line Items]
Concentration risk percentage		14.90%

XML 44 R34.htm IDEA: XBRL DOCUMENT

Subsequent Events (Narrative) (Details) - Common Stock [Member] - USD ($)				2 Months Ended
	Aug. 26, 2016	Jun. 06, 2016	Apr. 20, 2016	Jun. 06, 2016	Feb. 03, 2016	Dec. 31, 2015
Subsequent Event [Line Items]
Stock issue price					$ 0.40
Secured Convertible Promissory Note With First Fire Global Opportunities Fund LLC - December 28, 2015 [Member]
Subsequent Event [Line Items]
Stock issued to lender for failure to file reports with SEC, shares		40,000	30,000	70,000
Stock issued to lender for failure to file reports with SEC, value				$ 28,000
Stock issue price		$ 0.40		$ 0.40		$ 0.225
Subsequent Event [Member] \| Secured Convertible Promissory Note With First Fire Global Opportunities Fund LLC - December 28, 2015 [Member]
Subsequent Event [Line Items]
Stock issued to lender for failure to file reports with SEC, shares	130,000
Stock issued to lender for failure to file reports with SEC, value	$ 52,000
Stock issue price	$ 0.40
Penalty paid for failure to file with SEC	$ 5,000