10-Q

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

(Mark one)

[X]	QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934.
	For the quarterly period ended September 30, 2016
OR
[  ]	TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
	For the transition period from ________ to ________

Commission file number 000-53046

GTX Corp

(Exact name of registrant as specified in its charter)

Nevada	98-0493446
(State or other jurisdiction of incorporation or organization)	(I.R.S. Employer Identification No.)

117 W. 9th Street, Suite 1214, Los Angeles, CA, 90015

(Address of principal executive offices) (Zip Code)

(213) 489-3019

(Registrant’s telephone number, including area code)

(Former name, former address and former fiscal year, if changed since last report.)

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.

Yes [X] No [  ]

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, 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).

Yes [X] 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 definitions 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	[X]

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

Yes [  ] No [X]

Indicate the number of shares outstanding of each of the issuer's classes of common stock, as of the latest practicable date: 463,330,518 common shares issued and outstanding as of November 14, 2016.

GTX CORP AND SUBSIDIARIES

For the quarter ended September 30, 2016

FORM 10-Q

			PAGE NO.
PART I. FINANCIAL INFORMATION
Item 1.	Financial Statements:		3
		Consolidated Balance Sheets at September 30, 2016 and December 31, 2015 (unaudited)	3
		Consolidated Statements of Operations for the three and nine months ended September 30, 2016 and 2015 (unaudited)	4
		Consolidated Statements of Cash Flows for the nine months ended September 30, 2016 and 2015 (unaudited)	5
		Notes to Consolidated Financial Statements (unaudited)	6
Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations		14
Item 3.	Quantitative and Qualitative Disclosures About Market Risk		20
Item 4.	Controls and Procedures		20
PART II. OTHER INFORMATION
Item 1.	Legal Proceedings		20
Item1A.	Risk Factors		20
Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds		20
Item 3.	Defaults Upon Senior Securities		20
Item 4.	Mine Safety Disclosures		21
Item 5.	Other Information		21
Item 6.	Exhibits		21
	Signatures		22

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PART I

ITEM 1. FINANCIAL STATEMENTS

GTX CORP AND SUBSIDIARIES

CONSOLIDATED BALANCE SHEETS

(Unaudited)

	September 30, 2016			December 31, 2015
ASSETS
Current assets:
Cash and cash equivalents	$	29,945		$	7,868
Accounts receivable, net		127,421			40,984
Inventory		55,371			57,643
Other current assets		119,993			55,449
Total current assets		332,730			161,944
Property and equipment, net		133,344			131,792
Investment in equity securities		63,325			-
Intangible assets		18,780			15,000
Total assets	$	548,179		$	308,736
LIABILITIES AND STOCKHOLDERS’ DEFICIT
Current liabilities:
Accounts payable and accrued expenses	$	244,746		$	438,960
Accrued expenses - related parties		295,131			291,451
Deferred revenues		3,255			2,775
Current portion convertible promissory notes, net of discount		626,303			556,250
Derivative liability		224,626			-
Total current liabilities		1,394,061			1,289,436
Long-term convertible promissory notes, net of discount		156,575			200,000
Long-term convertible promissory notes – related parties		318,671			-
Total liabilities		1,869,307			1,489,436
Commitments and contingencies
Stockholders’ deficit:
Preferred stock, $0.001 par value; 10,000,000 shares authorized; no shares issued and outstanding		-			-
Common stock, $0.001 par value; 2,071,000,000 shares authorized; 453,378,517 and 355,431,281 shares issued and outstanding at September 30, 2016 and December 31, 2015, respectively		453,378			355,431
Additional paid-in capital		17,558,328			16,982,932
Accumulated deficit		(19,332,834	)		(18,519,063	)
Total stockholders’ deficit		(1,321,128	)		(1,180,700	)
Total liabilities and stockholders’ deficit	$	548,179		$	308,736

See accompanying notes to consolidated financial statements.

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GTX CORP AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF OPERATIONS

(Unaudited)

	Three Months Ended September 30,						Nine Months Ended September 30,
	2016			2015			2016			2015
Revenues	$	140,423		$	121,339		$	312,974		$	393,425
Consulting income		100,846			-			188,325			-
Total revenues		241,269			121,339			501,299			393,425
Cost of goods sold		83,338			91,834			220,300			288,032
Gross margin		157,931			29,505			280,999			105,393
Operating expenses
Wages and professional fees		269,050			353,447			756,150			863,083
General and administrative		54,082			38,206			171,521			171,616
Total operating expenses		323,132			391,653			927,671			1,034,699
Loss from operations		(165,201	)		(362,148	)		(646,672	)		(929,306	)
Other income/(expenses)
(Gain) loss on extinguishment of debt		(250	)		137,250			(29,577	)		105,192
Derivative income		215,502			-			537,738			13,490
Amortization of debt discount		(213,964	)		-			(623,675	)		-
Interest expense		(11,549	)		(41,788	)		(51,585	)		(79,324	)
Total other income/(expenses)		(10,261	)		95,462			(167,099	)		39,358
Net loss	$	(175,462	)	$	(266,686	)	$	(813,771	)	$	(889,948	)
Weighted average number of common shares outstanding - basic and diluted		425,868,780			327,554,083			391,714,192			308,100,018
Net loss per common share - basic and diluted	$	(0.00	)	$	(0.00	)	$	(0.00	)	$	(0.00	)

See accompanying notes to consolidated financial statements.

4

GTX CORP AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF CASH FLOWS

(Unaudited)

	Nine Months Ended September 30,
	2016			2015
Cash flows from operating activities
Net loss	$	(813,771	)	$	(889,948	)
Adjustments to reconcile net loss to net cash used in operating activities:
Depreciation		27,344			2,632
Stock-based compensation		273,135			389,014
(Gain) loss on extinguishment of debt		29,577			(105,192	)
Derivative (income) expense		(537,738	)		(13,490	)
Amortization of debt discount		623,675			68,764
Interest added to debt		27,119			-
Fair value of common stock received as income		(63,325	)		-
Changes in operating assets and liabilities:
Accounts receivable		(86,437	)		(10,650	)
Inventory		2,272			38,066
Other current and non-current assets		(90,414	)		(57,880	)
Accounts payable and accrued expenses		(194,214	)		91,520
Accrued expenses - related parties		409,680			55,252
Deferred revenues		480			(74,789	)
Net cash used in operating activities		(392,617	)		(506,701	)
Cash flows from investing activities
Purchase of intangible assets		(3,780	)		-
Purchase of property and equipment		(3,026	)		(4,813	)
Net cash used in investing activities		(6,806	)		(4,813	)
Cash flows from financing activities
Proceeds from convertible promissory notes		444,500			512,500
Payments on convertible promissory notes		(23,000	)		(3,000	)
Net cash provided by financing activities		421,500			509,500
Net change in cash and cash equivalents		22,077			(2,014	)
Cash and cash equivalents, beginning of period		7,868			12,168
Cash and cash equivalents, end of period	$	29,945		$	10,154
Supplemental disclosure of cash flow information:
Income taxes paid	$	-		$	-
Interest paid	$	-		$	2,503
Supplementary disclosure of noncash financing activities:
Issuance of stock for accrued expenses-related parties	$	87,000		$	229,438
Issuance of common stock for conversion of debt	$	262,094		$	342,232
Debt discount on convertible notes payable	$	89,500		$	-
Accrued salaries converted to convertible promissory notes	$	318,671		$	-

See accompanying notes to consolidated financial statements.

5

GTX CORP AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

September 30, 2016

(Unaudited)

1.       ORGANIZATION AND BASIS OF PRESENTATION

During the periods covered by these financial statements, GTX Corp and subsidiaries (the “Company” or “GTX”) were engaged in businesses that design, develop and sell various interrelated and complementary products and services in the Personal Location Wearable Technology marketplace. GTX owns 100% of the issued and outstanding capital stock of Global Trek Xploration (“GTX California”) and LOCiMOBILE, Inc. Through February 2015, GTX also owned 100% of the issued and outstanding capital stock of Code Amber News Service, Inc. (“CANS”), which it dissolved in February 2015.

Global Trek Xploration designs, develops, manufactures and distributes - hardware, software, connectivity services of Global Positioning System (“GPS”) and Bluetooth Low Energy (“BLE”) monitoring and tracking solutions that provide real-time tracking of the whereabouts of people and high valued assets. Utilizing a miniature quad band GPRS transceiver, antenna, circuitry, battery and inductive charging pad our product(s) can be customized and integrated into numerous products and form factors whose location and movement can be monitored in real time over the Internet through our 24x7 tracking portal or on a web enabled cellular telephone. Our core products and services are supported by an extensive IP portfolio of patents, patents pending, registered trademarks, copyrights, URLs and a library of software source code.

LOCiMOBILE, Inc., has been engaged in of Smartphone application (“App”) development since 2008. With a suite of mobile applications that turn the iPhone, iPad, Android and other GPS enabled handsets into a tracking device which can be tracked from handset to handset or through our tracking portal or on any connected device with internet access. LOCiMOBILE has launched numerous Apps across multi mobile device operating systems and continues to launch consumer and enterprise apps.

Basis of Presentation

The accompanying unaudited consolidated financial statements of GTX have been prepared in accordance with accounting principles generally accepted in the United States for interim financial information and applicable regulations of the U.S. Securities and Exchange Commission. Certain information and footnote disclosures normally included in financial statements prepared in accordance with accounting principles generally accepted in the United States have been omitted pursuant to such rules and regulations. In the opinion of management, all adjustments (consisting only of normal recurring adjustments) considered necessary for a fair statement of financial position and results of operations have been included. Our operating results for the three and nine months ended September 30, 2016 are not necessarily indicative of the results that may be expected for the year ending December 31, 2016. The accompanying unaudited consolidated financial statements should be read in conjunction with our audited consolidated financial statements for the year ended December 31, 2015, which are included in our Annual Report on Form 10-K.

The accompanying consolidated financial statements reflect the accounts of GTX Corp and its wholly owned subsidiaries. All significant inter-company balances and transactions have been eliminated.

Going Concern

The consolidated financial statements have been prepared on a going concern basis which assumes the Company will be able to realize its assets and discharge its liabilities in the normal course of business for the foreseeable future.  The Company has incurred net losses of $813,771 and $889,948 for the nine months ended September 30, 2016 and 2015, respectively, has incurred losses since inception resulting in an accumulated deficit of $19,332,834 as of September 30, 2016, and has negative working capital of $1,061,331 as of September 30, 2016. The Company anticipates further losses in the development of its business.

The ability to continue as a going concern is dependent upon the Company generating profitable operations in the future and/or obtaining the necessary financing to meet its obligations and repay its liabilities arising from normal business operations when they come due. The Company’s ability to raise additional capital through the future issuances of debt or equity is unknown. The obtainment of additional financing, the successful development of the Company’s contemplated plan of operations, or its attainment of profitable operations are necessary for the Company to continue operations. The ability to successfully resolve these factors raise substantial doubt about the Company’s ability to continue as a going concern. The consolidated financial statements of the Company do not include any adjustments that may result from the outcome of these aforementioned uncertainties.

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2.       SIGNIFICANT ACCOUNTING POLICIES

Use of Estimates

The preparation of the accompanying unaudited consolidated financial statements requires the use of estimates that affect the reported amounts of assets, liabilities, revenues, expenses and contingencies. These estimates include, but are not limited to, estimates related to revenue recognition, allowance for doubtful accounts, inventory valuation, tangible and intangible long-term asset valuation, warranty and other obligations and commitments. Estimates are updated on an ongoing basis and are evaluated based on historical experience and current circumstances. Changes in facts and circumstances in the future may give rise to changes in these estimates which may cause actual results to differ from current estimates.

Fair Value Estimates

Pursuant to the Accounting Standards Codification (“ASC”) No. 820, “Disclosures About Fair Value of Financial Instruments”, the Company records its financial assets and liabilities at fair value. ASC No. 820 provides a framework for measuring fair value, clarifies the definition of fair value and expands disclosures regarding fair value measurements. Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability (an exit price) in an orderly transaction between market participants at the reporting date. ASC No. 820 establishes a three-tier hierarchy, which prioritizes the inputs used in the valuation methodologies in measuring fair value:

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

Level 2—Inputs (other than quoted prices included in Level 1) are either directly or indirectly observable for the asset or liability through correlation with market data at the measurement date and for the duration of the asset/liability’s anticipated life.

Level 3—Inputs reflect management’s best estimate of what market participants would use in pricing the asset or liability at the measurement date. Consideration is given to the risk inherent in the valuation technique and the risk inherent in the inputs to the model.

The carrying values for cash and cash equivalents, accounts receivable, other current assets, accounts payable and accrued liabilities approximate their fair value due to their short maturities.

Equity Securities

During the second quarter of fiscal 2016, we received restricted equity securities, which we have classified as “available for sale” securities. Our equity securities are marked to market on a quarterly basis, with unrealized gains and losses being excluded from earnings and reflected as a component of other comprehensive income.

The inputs or methodology used for valuing securities are not necessarily an indication of the risk associated with investing in those securities.

Following are the disclosures related to our financial assets pursuant to ASC No. 820:

	September 30, 2016
	Fair Value		Input Level
Available for sale marketable securities:
Common stock	$	63,325		Level 1

The fair value of our available for sale securities is determined based on quoted market prices for identical securities on a quarterly basis.

Derivative Instruments

Our debt or equity instruments may contain embedded derivative instruments, such as conversion options, which in certain circumstances may be required to be bifurcated from the associated host instrument and accounted for separately as a derivative instrument liability.

Our derivative instrument liabilities are re-valued at the end of each reporting period, with changes in the fair value of the derivative liability recorded as charges or credits to income, in the period in which the changes occur. For bifurcated conversion options that are accounted for as derivative instrument liabilities, we determine the fair value of these instruments using the Black-Scholes option pricing model. This model requires assumptions related to the remaining term of the instrument and risk-free rates of return, our current Common Stock price and expected dividend yield, and the expected volatility of our Common Stock price over the life of the option.

7

Reclassifications

For comparability, certain prior period amounts have been reclassified, where appropriate, to conform to the financial statement presentation used in 2016. These reclassifications have no impact on net loss.

Recently Issued Accounting Pronouncements

The Financial Accounting Standards Board has recently issued accounting pronouncements, most of which represent technical corrections to the accounting literature or application to specific industries, which are not expected to have a material impact on the Company’s financial position, results of operations or cash flows. We do not believe that the adoption of any recently issued accounting standards will have a material effect on our financial position and results of operations.

3.       JOINT VENTURE AND INVESTMENT IN EQUITY SECURITIES

On June 16, 2016, the Company entered into a Definitive Agreement with Inventergy Innovations, LLC (“Inventergy”), a subsidiary of Inventergy Global, Inc. (NASDAQ: INVT). The Company partnered with Inventergy to monetize three (3) GTX Patents. Upon signing the Agreement, the Patents were assigned to an Inventergy subsidiary, and Inventergy assigned a 45% interest in the entity to GTX. Inventergy is also obligated to make a sequence of quarterly payments to GTX in 2017, which payments represent non-refundable advances against future royalty and other payments. Pursuant to a non-exclusive license back to GTX, GTX will still retain all use rights of the 3 patents.

In addition to the Definitive Agreement, the Company entered into a Consulting Agreement with Inventergy for a period of eighteen months. The Company was issued 42,500 shares of restricted common stock of INVT, of which 1/6^th of the stock vests at the close of each calendar quarter and Inventergy agreed to make five monthly payments to GTX totaling $250,000 through December 2016 as compensation. As of September 30, 2016, $125,000 of the cash compensation had been recognized. As of September 30, 2016, we owned 42,500 shares of restricted common stock of INVT valued $63,325.

The Company uses the equity method to account for its investment in the Inventergy subsidiary. Under the equity method, the Company recognizes its share of the earnings and losses of the subsidiary as they accrue instead of when they are realized. As of September 30, 2016, the Company’s investment in the subsidiary was $0.

4.       RELATED PARTY TRANSACTIONS

In order to preserve cash for other working capital needs, various officers and members of management have agreed to accrue, and defer payment of, portions of their salaries since fiscal 2011.

On September 30, 2016 management has elected to transfer accrued salaries into long-term convertible promissory notes, due on December 31, 2018, the total amount of salaries converted was $318,671. The notes will bear a 10% annual interest rate. Management shall have the right, but not the obligation to convert up to 50% of the amount advanced and accrued interest into shares, warrants or options of common or preferred stock of the Company at $0.01 per share.

As of September 30, 2016 and December 31, 2015, the Company owed $295,131 and $291,451, respectively for such accrued wages.

5.       DEBT

The following table summarizes the components of our short-term borrowings:

	September 30, 2016			December 31, 2015
Q4 2014 Convertible Notes	$	126,000		$	126,000
Q1 2015 Convertible Notes		60,000			150,000
Q2 2015 Convertible Notes		200,000			200,000
Q3 2015 Convertible Notes		45,000			84,000
Q4 2015 Convertible Notes		-			196,250
Q1 2016 Convertible Notes		140,000			-
Q2 2016 Convertible Notes		302,181			-
Q3 2016 Convertible Notes		507,671			-
Total convertible notes		1,380,852			756,250
Less: Debt discount		(279,303	)		-
Convertible notes, net of debt discount		1,101,549			756,250
Current portion of convertible notes	$	626,303		$	556,250
Long-term convertible notes	$	475,246		$	200,000

8

On January 15, 2016, we received an additional installment of $15,000 from an accredited investor relating to the 7.5% Convertible Debenture entered into on October 9, 2015. On April 15, 2016, this note was sold to a private investor pursuant to the Exchange Agreement as described below.

On January 27, 2016, pursuant to a Note Purchase Agreement with an unaffiliated third party (the “Investor”) relating to the sale of an unsecured convertible promissory note and warrant. The third party purchased an additional unit for $25,000 and a principal balance of $30,000. The convertible promissory note is divided into units (“Units”), each in the principal amount of $30,000, with equal installments of $1,000 due sequentially every week until $30,000 has been repaid and warrants to purchase 1,250,000 shares of common stock at an exercise price of $0.015 per share. The convertible promissory notes are due on November 25, 2016, subject to certain conditions and restrictions set forth in the notes. The convertible promissory note has a relative fair value of $23,899 and the warrants has a relative fair value of $6,101 at the date of issuance determined using the Black-Scholes option-pricing model. The assumptions used to calculate the fair market value are as follows: (i) risk-free interest rate of 0.88% (ii) estimated volatility of 171% (iii) dividend yield of 0.00% and (iv) expected life of the warrants of 25 months. The convertible note is convertible into shares of common stock based on the volume weighted average of the closing price per share for the 20 consecutive trading days prior to the conversion date if there is any outstanding principal balance due after the expiration due date. As of September 30, 2016, $5,000 cash installment payments have been made toward lowering the outstanding principal balance. On September 14, 2016, we consolidated all of these Investor’s notes into a single note valued at $120,000. The note is due December 16, 2016 and carries an OID of 20%.

On February 5, 2016, an accredited investor with a convertible note of $30,000, converted their outstanding principal balance into 2,250,000 shares of common stock at a conversion price of $0.015.

On February 8, 2016, we entered into a Note and Share Purchase Agreement with an unaffiliated third party (the “Investor”) relating to the sale of an unsecured convertible promissory note. The convertible promissory note is divided into units (“Units”), each in the principal amount of $30,000. The notes are due on December 31, 2016, subject to certain conditions and restrictions set forth in the notes. The convertible notes are convertible into shares of common stock at $0.01 per share. On February 8, 2016 the Investor purchased two $25,000 units (for a total of $50,000).

During the period ended September 30, 2016, we made a cash payment of $23,000 to an accredited investor to reduce the outstanding balance on his loans.

On March 16, 2016, we entered into a Loan Agreement with an independent accredited investor relating to the sale of a convertible promissory note and warrant. As a result, we issued convertible notes with a total principal balance of $55,000 and warrants to purchase 2,500,000 shares of common stock at an exercise price of $0.0125 per share. The convertible promissory note has a relative fair value of $33,379 and the warrants has a relative fair value of $21,621 at the date of issuance determined using the Black-Scholes option-pricing model. The assumptions used to calculate the fair market value are as follows: (i) risk-free interest rate of 1.05% (ii) estimated volatility of 221% (iii) dividend yield of 0.00% and (iv) expected life of the warrants of 3 years. The Convertible Note carries an original issue discount of 10%, mature on March 16, 2017 with a 12% interest rate and are convertible into common stock of the Company at 60% of the lowest closing price over a five day period immediately prior to but not including the Conversion Date. However, the conversion price shall not be lower than $0.005 per share.

On March 16, 2016, we entered into a Loan Agreement with an independent accredited investor relating to the sale of a convertible promissory note and warrant. As a result, we issued convertible notes with a total principal balance of $25,000 and warrants to purchase 500,000 shares of common stock at an exercise price of $0.0125 per share. The convertible promissory note has a relative fair value of $19,455 and the warrants has a relative fair value of $5,545 at the date of issuance determined using the Black-Scholes option-pricing model. The assumptions used to calculate the fair market value are as follows: (i) risk-free interest rate of 1.05% (ii) estimated volatility of 221% (iii) dividend yield of 0.00% and (iv) expected life of the warrants of 3 years. The Convertible Note carries an original issue discount of 10%, mature on March 16, 2017 with a 12% interest rate and are convertible into common stock of the Company at 60% of the lowest closing price over a five day period immediately prior to but not including the Conversion Date. However, the conversion price shall not be lower than $0.005 per share.

On April 15, 2016, the Company entered into an Exchange Agreement (the “Exchange Agreement”) and a Lock-Up Agreement (the “Lock-Up Agreement”) with a private investor (the “Investor”). Pursuant to the Exchange Agreement, the Company agreed to issue the Investor two promissory notes in the amount of $234,619 and $29,327 (the “Notes”), respectively, in exchange for a 7.5% Convertible Debenture purchased by the Investor from a third party (the “Original Note”). The Company has also granted the Investor a right of first refusal on all future Company financings over the next twelve months. Via the Exchange Agreement, the Company was able to extend the maturity dates of the Notes to May 10, 2016 and October 15, 2016, respectively. Pursuant to the Lock-Up Agreement, the Investor has agreed not to sell any shares acquired from conversion of the Note until May 10, 2016. The convertible notes are convertible into shares of common stock at 49% of the lowest traded price in the prior thirty trading days. As a result of the Exchange Agreement, we recognized a loss on extinguishment of debt of $29,327.

9

On April 18, 2016, the Company entered into a Loan Agreement with a private investor in connection with a bridge financing transaction, consisting of an Unsecured Convertible Promissory Note in principal amount of $25,000 and three-year warrants to purchase 500,000 shares of the Company’s common stock with an exercise price of $0.0125 per share. The convertible promissory note has a relative fair value of $20,872 and the warrants has a relative fair value of $4,128 at the date of issuance determined using the Black-Scholes option-pricing model. The assumptions used to calculate the fair market value are as follows: (i) risk-free interest rate of 0.90% (ii) estimated volatility of 215% (iii) dividend yield of 0.00% and (iv) expected life of the warrants of 3 years. The Convertible Note carries an original issue discount of 10%, mature on April 14, 2017 with a 12% interest rate and are convertible into common stock of the Company at 60% of the lowest closing price over a five day period immediately prior to but not including the Conversion Date. However, the conversion price shall not be lower than $0.005 per share.

On May 6, 2016, the Company entered into a Note Purchase Agreement with an unaffiliated third party (the “Investor”) relating to the sale of an unsecured convertible promissory note. The third party purchased an additional unit for $25,000 and a principal balance of $30,000. The convertible promissory note is divided into units (“Units”), each in the principal amount of $25,000, with equal installments of $1,000 due sequentially every week until $30,000 has been repaid. The convertible promissory notes are due on December 2, 2016, subject to certain conditions and restrictions set forth in the notes. The convertible note is convertible into shares of common stock based on the volume weighted average of the closing price per share for the 20 consecutive trading days prior to the conversion date if there is any outstanding principal balance due after the expiration due date. On June 14, 2016, we consolidated all of these Investor’s notes into a single note valued at $120,000. The note is due December 16, 2016 and carries an OID of 20%.

On May 10, 2016, we issued a total of 8,201,811 shares of common stock to two investors upon the conversion of $50,000 in debt from Convertible Notes that were issued in the first quarter of 2015 and the second quarter of 2016.

On June 7, 2016, we issued a total of 6,500,000 shares of common stock to an investor upon the conversion of $23,888 in debt from a Convertible Note that was issued in the second quarter of 2016.

On June 14, 2016, we received $45,000 from a noteholder who consolidated the remaining balance of $55,000 in notes into a $100,000 convertible note with an OID of 20%. The convertible note matures on December 16, 2016, without interest, and is convertible into common stock of the Company at the lowest traded price in the 5 days prior to the conversion. The noteholder will received 2,000,000 shares of common stock for the origination of this loan. These shares were issued on August 5, 2016.

On June 28, 2016, a noteholder assigned his remaining balance of $60,000 to another investor who consolidated it with that investor’s $40,000 convertible note. The new convertible note matures on December 31, 2016, without interest, and is convertible into common stock of the Company at the lower of 49% of the lowest traded price in the prior 30 days or $0.005 per share. On July 25, 2016, the noteholder converted their outstanding principal balance into 16,773,833 shares of common stock at a conversion price of $0.003577 per share.

On July 8, 2016, we raised $150,000 related to a Warrant and Note Purchase Agreement with unaffiliated third parties (the “Investors”) relating to the sale of unsecured convertible promissory notes. The promissory notes are divided into units (“Units”), each in the principal amount of $31,500. The Convertible Note carries an original issue discount of 26%, mature on December 31, 2017 and are convertible into common stock of the Company at $0.015 per share, subject to adjustment and mandatory conversion. On July 8, 2016, the Investors had purchased the minimum raise required of six $25,000 Units (for a total of $150,000). The Agreement comes with two 3-year warrants, one to purchase 1,050,000 shares of common stock at $0.015 per share and the other to purchase 525,000 shares of common stock at $0.03 per share. The convertible promissory notes have a relative fair value of $134,019 and the warrants have a relative fair value of $54,981 at the date of issuance determined using the Black-Scholes option-pricing model. The assumptions used to calculate the fair market value are as follows: (i) risk-free interest rate of 0.71% (ii) estimated volatility of 200% (iii) dividend yield of 0.00% and (iv) expected life of the warrants of 3 years.

On July 10, 2016, we issued a total of 5,000,000 shares of common stock to an investor for converting $17,885 in debt from a Convertible Note that closed in the first quarter of 2016.

On August 3, 2016, we issued a total of 5,000,000 shares of common stock to an investor for converting $19,845 in debt from a Convertible Note that closed in the first quarter of 2016.

On August 16 2016, we issued a total of 2,500,000 shares of common stock to an investor for converting $10,168 in debt from a Convertible Note that closed in the first quarter of 2016.

On August 26, 2016, we issued a total of 5,000,000 shares of common stock to an investor for converting $19,600 in debt from a Convertible Note that closed in the first quarter of 2016.

On September 19, 2016, we issued a total of 10,000,000 shares of common stock to an investor for converting $30,380 in debt from a Convertible Note that closed in the first quarter of 2016.

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Derivative liabilities

The conversion features embedded in the convertible notes were evaluated to determine if such conversion feature should be bifurcated from its host instrument and accounted for as a freestanding derivative. In the convertible notes with variable conversion terms, the conversion feature was accounted for as a derivative liability. The derivatives associated with the term convertible notes were recognized as a discount to the debt instrument and the discount is amortized over the expected life of the notes with any excess of the derivative value over the note payable value recognized as additional interest expense at the issuance date. Amortization of the debt discount totaled $623,675 and $0 during the periods ended September 30, 2016 and 2015, respectively.

The derivative liability was calculated using the Black Scholes method over the expected terms of the convertible debentures, with a risk free rate of 2% and volatility of 107% as of September 30, 2016. Included in Derivative Income in the accompanying consolidated statements of operations is income arising from the change in fair value of the derivatives of $537,738 and $13,490 during the periods ended September 30, 2016 and 2015, respectively.

6.       EQUITY

Common Stock

On January 20, 2016, we issued 5,921,592 shares of common stock (valued at $45,000) to reduce accrued management salaries and 1,500,000 shares of common stock (valued at $11,400) various consultants and accredited investors.

On February 5, 2016, an accredited investor with a convertible note of $30,000, converted their outstanding principal balance into 2,000,000 shares of common stock at a conversion price of $0.015 per share and was issued an additional 250,000 shares of common stock at a price of $0.015 per share.

On March 3, 2016, we issued 4,250,000 shares of common stock (valued at $55,250) to 3 advisors for services rendered.

On March 16, 2016, we hired Greentree Financial Group to assist with financial matters throughout 2016. We are compensating Greentree Financial for their services with 2,500,000 shares of common stock (valued at $25,000) that we issued in March 2016 in connection with their engagement.

On May 4, 2016, we issued 4,250,000 shares of common stock (valued at $42,500) to 5 various consultants.

On May 10, 2016, we issued 3,000,000 shares of common stock (valued at $30,000) to reduce accrued management salaries and 1,250,000 shares of common stock (valued at $12,500) to 5 board of directors for their services.

On May 10, 2016, we issued a total of 8,201,811 shares of common stock to two investors for converting $50,000 in debt from Convertible Notes that was issued in the first quarter of 2015 and the second quarter of 2016.

On June 7, 2016, we issued a total of 6,500,000 shares of common stock to an investor for converting $23,888 in debt from a Convertible Note that was issued in second quarter of 2016.

On July 10, 2016, we issued a total of 5,000,000 shares of common stock to an investor for converting $17,885 in debt from a Convertible Note that closed in the first quarter of 2016.

On July 25, 2016, we issued a total of 16,773,833 shares of common stock to an investor for converting $60,000 in debt from a Convertible Note that closed in the first quarter of 2015.

On August 3, 2016, we issued a total of 5,000,000 shares of common stock to an investor for converting $19,845 in debt from a Convertible Note that closed in the first quarter of 2016.

On August 5, 2016, we issued 10,800,000 shares of common stock (valued at $86,400) to five consultants for services performed.

On August 16 2016, we issued a total of 2,500,000 shares of common stock to an investor for converting $10,168 in debt from a Convertible Note that closed in the first quarter of 2016.

On August 26, 2016, we issued a total of 5,000,000 shares of common stock to an investor for converting $19,600 in debt from a Convertible Note that closed in the first quarter of 2016.

On September 15, 2016, we issued 1,500,000 shares of common stock (valued at $12,000) to reduce accrued management salaries and 1,000,000 shares of common stock (valued at $8,000) to 4 board of directors for their services.

On September 15, 2016, we issued 750,000 shares of common stock (valued at $6,000) to two consultants for services performed.

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On September 19, 2016, we issued a total of 10,000,000 shares of common stock to an investor for converting $30,380 in debt from a Convertible Note that closed in the first quarter of 2016.

The Company issued the following shares of common stock during the nine months ended September 30, 2016:

	Value of Shares		Number of Shares
Shares issued for services rendered	$	254,300		26,550,000
Shares issued for accrued expenses		87,000		10,421,592
Shares issued for conversion of debt		262,094		60,975,644
Total	$	603,394		97,947,236

Shares issued for services rendered were to various members of management, the Board of Directors, employees and consultants and are expensed as Stock-Based Compensation in the accompanying consolidated statement of operations. Shares issued for conversion of debt relate to conversion of the convertible notes discussed in Note 4.

Common Stock Warrants

Since inception, the Company has issued warrants to purchase shares of the Company’s common stock to shareholders, consultants and employees as compensation for services rendered and/or through private placements.

On January 27, 2016, 1,250,000 warrants were issued to an accredited investor as part of their Note and Share Purchase Agreement. The warrants expire on February 26, 2018 at an exercise price of $0.015.

On March 16, 2016, 3,000,000 warrants were issued to two accredited investors as part of their Loan Agreements. The warrants expire on March 16, 2019 at an exercise price of $0.0125.

On April 18, 2016, 500,000 warrants were issued to an accredited investor as part of the Note and Share Purchase Agreement. The warrant expires on April 18, 2019 at an exercise price of $0.0125.

On May 6, 2016, 1,250,000 warrants were issued to an accredited investor as part of the Note and Share Purchase Agreement. The warrant expires on December 16, 2018 at an exercise price of $0.015.

On May 16, 2016, 3,300,000 warrants were issued to consultant as part of their Advisory Services Agreement. The warrants expire on May 16, 2019 at an exercise price of $0.015.

On July 1, 2016, 4,200,000 series “A” warrants and 2,100,000 series “B” warrants were issued to an accredited investor as part of the Note and Warrant Purchase Agreement. The series A and B warrants expires on July 1, 2019 at an exercise price of $0.015 for the series A and $0.030 for the series B warrants.

On July 8, 2016, 2,100,000 series “A” warrants and 1,050,000 series “B” warrants were issued to two accredited investors as part of the Note and Warrant Purchase Agreement. The series A and B warrants expires on July 8, 2019 at an exercise price of $0.015 for the series A and $0.030 for the series B warrants.

A summary of the Company’s warrant activity and related information is provided below:

	Exercise Price $		Number of Warrants
Outstanding and exercisable at December 31, 2015		0.015 - 0.02		11,150,000
Warrants exercised		-		-
Warrants granted		0.0125 - 0.03		18,750,000
Warrants expired		-		-
Outstanding and exercisable at September 30, 2016		0.0125 - 0.03		29,900,000

Stock Warrants as of September 30, 2016
Exercise		Warrants		Remaining		Warrants
Price		Outstanding		Life (Years)		Exercisable
$	0.020		9,900,000		1.32		9,900,000
$	0.015		13,350,000		2.35		13,350,000
$	0.0125		3,500,000		2.50		3,500,000
$	0.030		3,150,000		2.77		3,150,000

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Common Stock Options

Under the Company’s 2008 Equity Compensation Plan (the “2008 Plan”), we are authorized to grant stock options intended to qualify as Incentive Stock Options, “ISO”, under Section 422 of the Internal Revenue Code of 1986, as amended, non-qualified options, restricted and unrestricted stock awards and stock appreciation rights to purchase up to 7,000,000 shares of common stock to our employees, officers, directors and consultants, with the exception that ISOs may only be granted to employees of the Company and its subsidiaries, as defined in the 2008 Plan. After adjusting for expired and estimated pre-vesting forfeitures, options for approximately 2,235,000 shares were still available for grant under the 2008 Plan as of September 30, 2016.

Stock option activity under the 2008 Plan for the nine months ended September 30, 2016 is summarized as follows:

	Shares			Weighted Average Exercise Price		Weighted Average Remaining Contractual Life (in years)		Grant Date Fair Value
Outstanding at December 31, 2015		452,493		$	0.08		0.84	$	46,901
Options granted		-			-		-		-
Options exercised		-			-		-		-
Options cancelled/ forfeited/ expired		(452,493	)		-		-		(46,901	)
Outstanding at September 30, 2016		-		$	-		-	$	-

The Company recognizes option expense ratably over the vesting periods. As all outstanding options had vested as of December 31, 2012, we have recognized no compensation expense related to options granted under the 2008 Plan during the nine months ended September 30, 2016 and 2015, however these options did expire after their 3 year period.

7.       SUBSEQUENT EVENTS

On October 14, 2016, we issued a total of 2,400,000 shares of common stock to an investor upon the conversion of $12,000 in debt from a Convertible Note that closed in the first quarter of 2016.

On October 28, 2016, we issued a total of 4,000,000 shares of common stock to an investor upon the conversion of $20,000 in debt from a Convertible Note that closed in the first quarter of 2016.

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ITEM 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

FORWARD-LOOKING STATEMENTS

This Quarterly Report on Form 10-Q, including “Management’s Discussion and Analysis of Financial Condition and Results of Operations” in Item 2 of Part I of this report include forward-looking statements. These forward looking statements are based on our management’s current expectations and beliefs and involve numerous risks and uncertainties that could cause actual results to differ materially from expectations. In some cases, you can identify forward-looking statements by terminology such as “may,” “should,” “expects,” “plans,” “anticipates,” “believes,” “estimates,” “predicts,” “potential,” “proposed,” “intended,” or “continue” or the negative of these terms or other comparable terminology. You should read statements that contain these words carefully, because they discuss our expectations about our future operating results or our future financial condition or state other “forward-looking” information. Many factors could cause our actual results to differ materially from those projected in these forward-looking statements, including but not limited to: variability of our revenues and financial performance; risks associated with product development and technological changes; the acceptance our products in the marketplace by existing and potential future customers; general economic conditions. You should be aware that the occurrence of any of the events described in this Quarterly Report could substantially harm our business, results of operations and financial condition, and that upon the occurrence of any of these events, the trading price of our securities could decline. Although we believe that the expectations reflected in the forward-looking statements are reasonable, we cannot guarantee future results, growth rates, levels of activity, performance or achievements. We are under no duty to update any of the forward-looking statements after the date of this Quarterly Report to conform these statements to actual results.

Introduction

Unless otherwise noted, the terms “GTX Corp”, the “Company”, “we”, “us”, and “our” refer to the ongoing business operations of GTX Corp and our wholly-owned subsidiaries, Global Trek Xploration, and LOCiMOBILE, Inc. During part of the first quarter of 2015, we owned Code Amber News Service, Inc., a wholly-owned subsidiary that was discontinued in February 2015. Accordingly, unless otherwise specified, references to the “Company”, “we”, “us”, and “our” for periods before February 2015 also refer to, and include Code Amber News Service, Inc.

Operations

GTX Corp and its subsidiaries (Global Trek Xploration, Inc. and LOCiMOBILE, Inc.) are engaged in the design, development, manufacturing, distribution and sales of five (5) related products and services in the GPS and BLE wearable technology personal location and wandering assistive technology business. Through a proprietary enterprise (IoT) monitoring platform and licensing subscription business model, the Company offers a complete end to end solution of hardware, middleware, apps, connectivity, licensing and professional services, letting you know where or how someone or something is at the touch of a button, delivering safety, security and peace of mind in real-time.

Overview

Since the start of 2015 the Company has focused on building channels of distribution for its product lines of embedded devices, Stand-Alone devices and Digital Apps which all funnel into the GTX Corp IoT monitoring platform. Each product line is sold both direct to consumer (B2C) and business to business (B2B) through a global network of resellers, affiliates, distributors, nonprofit organizations, government agencies, manufacturers reps and retailers. The Company has been ramping up its product distribution and sales channels and, as of September 30, 2016, the Company had live units in the field and / or paying subscribers in over 35 countries, had 8 regional sales reps in the US, 6 retired and active professional athlete brand ambassadors, over 300 online affiliates, 15 international and domestic distributors, and a joint venture distribution agreement in Ireland. Also we were issued a vendor numbers and/or orders for reimbursement in 6 U.S. states, and have applied for other State and Federal reimbursement codes, grants and private insurance reimbursement, which if granted is expected to increase the potential market for users of our SmartSole product line. All product lines are sold with a monthly, quarterly or annual subscription or licensing service plans ranging from $5 to $49 per month with close to 2,500 worldwide subscribers as of September 30, 2016.

During the quarter ended September 30, 2016, GTX Corp applied for and was assigned a National Provider Identifier (NPI) number from the National Plan Provider Enumeration System. The NPI is a unique identification number for covered health care providers. The Centers for Medicare & Medicaid Services (CMS) developed the National Plan and Provider Enumeration System (NPPES) to assign these unique identifiers and as outlined in the Health Insurance Portability and Accountability Act of 1996 (HIPAA), covered providers must also share their NPI with other providers, health plans, clearinghouses, and any entity that may need it for billing purposes. Having an NPI number should further facilitate our ability to sell our SmartSoles for elderly and other persons who need this product for medical purposes, and to comply with the billing requirements of government agencies and insurance providers.

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We have been modifying and upgrading our modules of our SmartSoles GPS tracking product to, among other things, make it available for use in various localities without customization. We refer to the modified/upgraded versions as versions 1.25, 1.5, etc. 450 of our last 500 units of our version 1.25 GPS modules devices that were assembled for use in SmartSoles the second fiscal quarter of 2016 were deployed into the marketplace in this third quarter of 2016. During this current quarter, we went into our third and fourth production runs of version 1.25 of our SmartSole modules, and are expecting delivery of 250 units in November and 500 units in December. We also placed an order for 300 units of version 1.5 with an expected delivery in January 2017. The production and roll-out of version 1.5 of our SmartSole product is expected to be a significant advancement for us on many levels. First we no longer have to custom make SmartSoles for our international distributors with their Sim cards, so our manufacturing cost and time lines are reduced and we have more flexibility to timely meet our customers’ requirements. Second we are now able to bill for data charges in over 100 countries, thereby increasing our potential markets. The ability to both produce a product that is able to be delivered to foregign market without customization and to bill for data charges in additional countries will enable us to increase our RPS (revenue per subscriber) which is continuing to trend up from last year.

During Q1, after having been granted our third patent in our “286” family of patents, we began actively exploring a monetization campaign. During Q2 2016 the Company signed an agreement with Inventergy Innovations, LLC (“Inventergy”), a subsidiary of Inventergy Global, Inc. (NASDAQ: INVT). Under the agreement, Inventergy will spearhead a monetization campaign for the three “286” GTX patents. Part of Inventergy’s strategy will be to require potential infringers of these patents to either license the use of the patents or sell to the patents to third parties that operate in related industries. Upon the signing of the Inventergy agreement, the three patents were assigned to an Inventergy subsidiary. In exchange for this assignment, GTX received a 45% interest in the Inventergy subsidiary. The Inventergy subsidiary granted GTX a non-exclusive license to use the three “286” patents. Accordingly, GTX will still retain all use rights of the 3 patents in GTX’s products.

All three of the GTX Corp patents are not limited to any particular form factor and are applicable to any generic tracking device, which, in its simplest form includes a communication device (i.e. cell phone modem, blue tooth or Wi-Fi communicator), a location detector (i.e. GPS or Wi-Fi Module) and data memory. This technology is now commonly embedded in millions of devices and deployed across numerous industries.

The potential value of these 3 patents is that they extend far beyond our core footwear patents and into areas such as GPS watches, fitness wearables that track location, hand-held GPS devices, tracking apps on Smartphones, standalone GPS tracking devices and location based platforms in general, which represents a very sizable addressable market.

Upon signing the agreement with Inventergy Innovations, LLC, its parent company, Inventergy Global, Inc., issued to GTX 42,500 restricted shares of Inventergy Global, Inc. common stock, having an initial value of $62,479, and a series of monthly cash payments totaling $250,000 through December 2016 as payment for consulting services. The restricted shares of common stock vests at a rate of 1/6^th at the close of each calendar quarter. Inventergy has also paid us $50,000 this quarter in cash and $75,000 in October 2016 as part of an overall payment schedule of fees due to GTX throughout the remainder of 2016. Starting in 2017, we expect a quarterly draw from the joint subsidiary against any future licensing revenues or possible sale of the patents that Inventergy is working to monetize.

In Q3, we delivered a prototype of our new proprietary tracking device for military use, on a non-cellular, encrypted GPS technology platform.  These new devices are being developed for large scale installations and bases that need to monitor the location and movement of every asset (both human and non-human on that base, but due to the remote location of these bases and lack of conventional cellular coverage the devices utilize RF technology and are in a hardened military grade encasement.  In preparation for developing an ongoing relationship with the military, we have applied for and received a System for Award Mangement (SAM) number and a General Services Administration (GSA) number and approval for SENSENET. We have shipped a small order of this prototype product to the military. Based on the feedback we have received from our customer, subject to budget approval, we may receive additional orders, possibly as early as in the fiscal quarter ended March 2017.

In our ongoing strategy to expand our SmartSole target market beyond senior citizens and towards young adults with autism and with the recent study that claims 1/3 of autistic youngsters wander, last quarter we brought on a new advisor - Lynette Louise an Internationally renowned Brain Expert with two board certifications in neurotherapy and author of several books. We are currently working with Lynette to begin offering workshops and consultations for families caring for a child on the far extreme of the ASD spectrum. This new initiative is intended to strengthen our role and presence in the autistic community and to expand our product offerings in our online store. This initiative is expected to launch in the 4^th quarter of 2016.

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Results of Operations

The following discussion should be read in conjunction with our interim consolidated financial statements and the related notes that appear elsewhere in this Quarterly Report.

Three Months Ended September 30, 2016 (“Q2 2016”) Compared to the Three Months Ended September 30, 2015 (“Q2 2015”)

	Three Months Ended September 30,
	2016						2015
	$			% of Revenues			$			% of Revenues
Revenues		241,269			100	%		121,339			100	%
Cost of goods sold		83,338			35	%		91,834			76	%
Net profit		157,931			65	%		29,505			24	%
Operating expenses:
Wages and professional fees		269,050			112	%		353,447			291	%
General and administrative		54,082			22	%		38,206			31	%
Total operating expenses		323,132			134	%		391,653			323	%
Loss from operations		(165,201	)		-68	%		(362,148	)		-298	%
Other expense, net		(10,261	)		-4	%		95,462			79	%
Net loss		(175,462	)		-73	%		(266,686	)		-220	%

Revenues

Revenues during Q3 2016 increased by 99% or $119,930 in comparison to Q3 2015 primarily due to $100,000 of consulting fees we received from Inventergy related to our proposed monetization of three patents in our IP portfolio, and to the increase in subscribers and higher revenues per subscriber (RPS). SmartSoles revenues increased due to our ability to have an embedded SIM card in our devices. Revenues from the sale of GPS SmartSoles in Q3 2015 accounted for approximately 62% of total revenues, in comparison to Q3 2016 SmartSole sales accounted for approximately 35% of total revenues. The increase in revenues (excluding the Inventergy payments) stems from a diverse product line and increase in recurring licensing and subscription service fees. We also had an increase in direct to consumer sales at a higher margin, increasing overall profits and increase in revenues per subscriber (RPS) as our consumer subscribers pay the higher retail price ranging from $25 to $49 per month and our B2B customers pay the wholesale price of $5 to $18 per month. The balance of the revenue for the second quarter of 2016 represented sales of stand-alone units, monthly service plans, licensing fees and App downloads.

Cost of goods sold

Cost of goods sold decreased 9% or $8,496 during Q3 2016 in comparison to Q3 2015 primarily due to increase in buying and manufacturing efficiencies. Total gross margin increased from 24% in Q3 2015 to 65% in Q3 2016, which reflects more revenue being derived from higher margin products and services and the consulting fees from Inventergy (there were no costs associated with that payment). As we increase our subscription base of monthly recurring fees, total overall gross margins are expected to increase accordingly.

Wages and professional fees

Wages and professional fees during Q3 2016 decreased 24% or $84,397 in comparison to Q3 2015 primarily due a reduction in stock based compensation to consultants and advisors.

General and administrative

General and administrative expenses during Q3 2016 increased 42% or $15,876 in comparison to Q3 2015 primarily due to an increase in business, customers and subscribers.

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Other income (expense), net

Other income, net decreased by 111% or $105,723 from Q3 2015 to Q3 2016 primarily as a result of costs associated in 2015 with debt financings, and the loss on the retirement of debt and the gain from the extinguishment of debt of $137,250. No such costs were realized in the same quarter in 2016. Other expense includes interest expenses related to notes, derivative income/loss, amortization of debt discount, and exchange gains or losses. The accounting treatment for the bifurcation of the derivative liabilities embedded in our short-term convertible notes results in a net derivative, non-cash income of $215,502. The net derivative expense represents the change in fair value of the derivative liability during the period as well as the amortization of the related debt discount.

Net loss

Net loss decreased by 34% or $91,224 from Q3 2015 to Q3 2016 primarily as a result of increased sales of SmartSoles, recurring monthly subscriptions and the revenue from the consulting income with Inventergy, and a decrease in total operating expenses.

Nine months Ended September 30, 2016 Compared to the Nine Months Ended September 30, 2015

	Nine months Ended September 30,
	2016						2015
	$			% of Revenues			$			% of Revenues
Revenues		501,299			100	%		393,425			100	%
Cost of goods sold		220,300			44	%		288,032			73	%
Net profit		280,999			56	%		105,393			27	%
Operating expenses:
Wages and professional fees		756,150			151	%		863,083			219	%
General and administrative		171,521			34	%		171,616			44	%
Total operating expenses		927,671			185	%		1,034,699			263	%
Loss from operations		(646,672	)		-129	%		(929,306	)		-236	%
Other expense, net		(167,099	)		-33	%		39,358			10	%
Net loss		(813,771	)		-162	%		(889,948	)		-226	%

Revenues

Revenues during the first nine months of 2016 increased by 27% or $107,874 in comparison to the same period in 2015, primarily due to the consulting fees and revenues related to the recognition of the value of the common stock received from Inventergy, the increase in subscribers and higher revenues per subscriber (RPS), and our first military shipment. Revenues from the sale of GPS SmartSoles in Q3 2015 accounted for approximately 72% of total revenues, in comparison to Q3 2016 SmartSole sales accounted for approximately 38% of total revenues, reflecting an increase in revenue streams from a diverse product line and recurring licensing and subscription service fees. We also had an increase in direct to consumer sales at a higher margin, increasing overall profits and increase in revenues per subscriber (RPS) as our consumer subscribers pay the higher retail price ranging from $25 to $49 per month and our B2B customers pay the wholesale price of $5 to $18 per month. The balance of the revenue for the second quarter of 2016 represented sales of stand-alone units, monthly service plans, consulting fees and App downloads.

Cost of goods sold

Cost of goods sold decreased 24% or $67,732 during the first nine months of 2016 in comparison to the same nine month period in 2015 primarily due increased in operational efficiencies. Total gross margin increased from 27% in the 2015 period to 56% in 2016, which reflects higher margins realized from the sale of the GPS SmartSole and consulting fees from Inventergy (there were no costs associated with that payment). We expect that overall gross margins will continue to increase slightly as the higher margin service subscription revenues increase.

Wages and professional fees

Wages and professional fees during the first nine months of 2016 decreased by 12% or $106,933 in comparison to the 2015 period despite increased staff, primarily due to increased operational efficiencies.  Professional fees are expected to increase as we grow our business and expand our products into the wearable technology marketplace both in the U.S. and internationally.

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General and administrative

General and administrative expenses during the first nine months of 2016 decreased 0.1% or $95 in comparison to the 2015 period despite the increase in sales and other activities. However, such expenses may increase in the future if our operations increase in accordance with our business plan.

Other income/(expense), net

Other income, net decreased by 525% or $206,457, from the first nine months of 2015 to 2016 primarily as a result of a decrease in costs associated with debt financings, and the loss on the retirement of debt and the gain from the extinguishment of debt of $137,250 realized in the same quarter in 2015, but not in 2016. Other income/expense includes interest expenses related to notes, derivative income/loss, amortization of debt discount, and exchange gains or losses. The accounting treatment for the bifurcation of the derivative liabilities embedded in our short-term convertible notes results in a net derivative, non-cash income of $537,738. The net derivative expense represents the change in fair value of the derivative liability during the period as well as the amortization of the related debt discount.

Net loss

Net loss for the respective nine month period decreased from 2015 to 2016 by $76,177, or 9%, primarily as a result of increased sales of SmartSoles, recurring monthly subscriptions and the revenue from the consulting agreement with Inventergy, as a direct result of the higher margin revenues and better operational efficiencies. The loss from operations decreased by a larger amount, or 30%, but the inclusion of losses related to derivative expenses, and increased interest expense reduced the net result.

Liquidity and Capital Resources

As of September 30, 2016, we had $29,945 of cash and cash equivalents, and a working capital deficit of $1,061,331, compared to $7,868 of cash and cash equivalents and a working capital deficit of $1,127,492 as of December 31, 2015.  A large part of our negative working capital position at September 30, 2016 consisted of $295,131 of amounts due to officers and management of the Company for accrued wages, and $626,303 related to the principal balance of unsecured convertible promissory notes, net of discount.  As further described below, since September 30, 2016, we have received a total of $444,500 from the sale of unsecured convertible promissory notes.

During the nine months ended September 30, 2016, our net loss was $813,771, compared to a net loss of $889,948 for the nine months ended September 30, 2015.  Net cash used in operating activities for Q3 2016 and Q2 2015 was $392,617 and $506,701, respectively.  Net cash used in operations was lower in Q3 2016 as compared to Q3 2015 because of non-cash expenses relating to stock issued for services.

Net cash provided by financing activities during Q3 2016 was $421,500 and consisted primarily of proceeds totaling $444,500 received from advances under various convertible note payable agreements as well as payments on Convertible Notes. Net cash provided by financing activities during Q3 2015 was $509,500 and consists of proceeds totaling $512,500 received from advances under a convertible note payable agreement.

Because revenues from our operations have, to date, been insufficient to fund our working capital needs, we currently rely on the cash we receive from both our financing activities and the Inventergy payments to fund our capital expenditures and to support our working capital requirements The sale of the SmartSole product, and the recurring revenues that we will receive from users, is expected to enhance our liquidity during the balance of 2016 and 2017, although the amount of revenues we receive in these periods cannot be estimated. We also expect to receive periodic cash payments under our patent monetization agreement with Inventergy. These payments, if they continue, will supplement or liquidity needs, but will not be sufficient to fund our expected cash needs in 2016 unless SmartSole revenues increase substantially. Inventergy has the right to terminate our agreement at any time. We also are entitled to receive 45% of third party payments that Inventergy receives from third parties upon the sale or licensing of our patent rights. Because it is uncertain if, or when, we will ever receive any payments from third parties related to the license or purchase of our patent rights, we have not included any such payments in our financial budgets.

Until such time as the SmartSoles revenues can support our working capital requirement, we expect to continue to generate ancillary revenues from our other licenses, Track My Work Force subscriptions, international distributors, hardware sales, professional services and new customers in the pipeline. However, the amount of such revenues is unknown and is not expected to be sufficient to fund our working capital needs. For our internal budgeting purposes, we have assumed that such revenues will not be sufficient to fund all of our planned operating and other expenditures in 2016 and early 2017. In addition, our actual cash expenditures may exceed our planned expenditures, particularly if we invest in the development of improved versions of our existing products and technologies, and if we increase our marketing expenses. Accordingly, we anticipate that we will have to continue to raise additional capital in order to fund our operations in 2016. No assurance can be given that we will be able to obtain the additional funding we need to continue our operations.

18

In order to continue funding our working capital needs and our product development costs, during the third quarter of 2016 we entered into 3 separate note and share purchase agreements with 3 independent accredited investors. As a result, we issued convertible notes with a total principal balance of $189,000 for cash proceeds of $150,000.

The licensing agreements, distribution agreements and product sales initiatives we have in place have, to date, have not generated enough revenues to cover all of our operational expenses. No assurance can be given that our current contractual arrangements and the revenues from our GPS SmartSoles, device sales, subscriptions, software licensing, or our smart phone or tablet Apps will generate significant revenues during the balance of 2016.

In addition to continuing to incur normal operating expenses, we intend to continue our research and development efforts for our technologies and products, including hardware, software, interface customization, and website development. We expect to further develop our sales, marketing and manufacturing programs associated with the commercialization, licensing and sales of our GPS devices and technology. We currently do not have sufficient capital on hand to fully fund our inventory requirements, marketing, advertising and future product development, which lack of and inconsistencies in the timing and amount of fundings may negatively affect our future revenues.

As noted above, based on budgeted revenues and expenditures, unless revenues increase significantly, we believe that our existing and projected sources of liquidity (including the minimum periodic payments we will receive from Inventergy while our agreement is in effect) may not be sufficient to satisfy our cash requirements for the next twelve months. Accordingly, we will need to raise additional funds in 2016 and 2017. The sale of additional equity securities will result in additional dilution to our existing stockholders. Sale of debt securities could involve substantial operational and financial covenants that might inhibit our ability to follow our business plan. Any additional funding that we obtain in a financing is likely to reduce the percentage ownership of the Company held by our existing security-holders. The amount of this dilution may be substantial based on our current stock price, and could increase if the trading price of our common stock declines at the time of any financing from its current levels. We may also attempt to raise funds through corporate collaboration and licensing arrangements. To the extent that we raise additional funds through collaboration and licensing arrangements, we may be required to grant licenses on terms that are not favorable to us. There can be no assurance that financing will be available in amounts or on terms acceptable to us, if at all. If we are unable to obtain the needed additional funding, we may have to further reduce our current level of operations, or may even have to totally discontinue our operations.

Since inception in 2002, we have generated significant losses. As of September 30, 2016, we had an accumulated deficit of $19,332,834, and we currently expect to incur continued losses until our revenue initiatives collectively generate substantial revenues. Please see the section entitled “Risk Factors” included in our Annual Report on Form 10-K for the year ended December 31, 2015 for more information regarding risks associated with our business.

Off-Balance Sheet Arrangements

There are no off-balance sheet arrangements that have or are reasonably likely to have a current or future effect on our financial condition, changes in financial condition, revenues or expenses, results of operations, liquidity, capital expenditures or capital resources that is material to investors.

Inflation

We do not believe our business and operations have been materially affected by inflation.

Critical Accounting Policies and Estimates

There are no material changes to the critical accounting policies and estimates described in the section entitled “Critical Accounting Policies and Estimates” under Item 7 in our Annual Report on Form 10-K for the year ended December 31, 2015.

19

ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

As a “smaller reporting company”, we are not required to provide the information under this Item 3.

ITEM 4. CONTROLS AND PROCEDURES.

Evaluation of Disclosure Controls and Procedures

Under the supervision and with the participation of our management, including our principal executive officer and principal financial officer, we conducted an evaluation of the effectiveness of the design and operation 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 of the end of the period covered by this report (the “Evaluation Date”). Based upon the evaluation, our principal executive officer and principal financial officer concluded as of the Evaluation Date that our disclosure controls and procedures were effective. Disclosure controls are controls and procedures designed to reasonably ensure that information required to be disclosed in our reports filed under the Exchange Act, such as this report, is recorded, processed, summarized and reported within the time periods specified in the SEC’s rules and forms. Disclosure controls include controls and procedures designed to reasonably ensure that such information is accumulated and communicated to our management, including our chief executive officer and chief financial officer, as appropriate to allow timely decisions regarding required disclosure.

Changes in Internal Controls Over Financial Reporting

There were no changes in our internal controls over financial reporting that occurred during the quarterly 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.

None.

ITEM 1A. RISK FACTORS.

None.

ITEM 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS.

On July 10, 2016, we issued a total of 5,000,000 shares of common stock to an investor for converting $17,885 in debt from a Convertible Note that closed in Q1 2016.

On July 25, 2016, we issued a total of 16,773,833 shares of common stock to an investor for converting $60,000 in debt from a Convertible Note that closed in Q1 2015.

On August 3, 2016, we issued a total of 5,000,000 shares of common stock to an investor for converting $19,845 in debt from a Convertible Note that closed in Q1 2016.

On August 5, 2016, we issued 10,800,000 shares of common stock (valued at $86,400) to four consultants and one investor in relation to their Convertible Note.

On August 16 2016, we issued a total of 2,500,000 shares of common stock to an investor for converting $10,168 in debt from a Convertible Note that closed in Q1 2016.

On August 26, 2016, we issued a total of 5,000,000 shares of common stock to an investor for converting $19,600 in debt from a Convertible Note that closed in Q1 2016.

On September 15, 2016, we issued 1,500,000 shares of common stock (valued at $12,000) to reduce accrued management salaries and 1,000,000 shares of common stock (valued at $8,000) to 4 board of directors for their services.

On September 15, 2016, we issued 750,000 shares of common stock (valued at $6,000) to two consultants for services performed.

On September 19, 2016, we issued a total of 10,000,000 shares of common stock to an investor for converting $30,380 in debt from a Convertible Note that closed in Q1 2016.

The issuance of the above shares was exempt from registration pursuant to Section 4(2) of the Securities Act of 1933, as amended.

ITEM 3. DEFAULTS UPON SENIOR SECURITIES.

None.

20

ITEM 4. MINE SAFETY DISCLOSURES.

Not applicable.

ITEM 5. OTHER INFORMATION.

None.

ITEM 6. EXHIBITS.

(a)       Exhibits

31.1	Certification of Chief Executive Officer pursuant to Section 302 of the Sarbanes-Oxley Act
31.2	Certification of Chief Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act
32.1	Certification of Chief Executive Officer pursuant to Section 906 of the Sarbanes-Oxley Act
32.2	Certification of Chief Financial Officer pursuant to Section 906 of the Sarbanes-Oxley Act
10.3	Definitive Agreement, dated June 16, 2016, between the Company and between Inventergy Innovations, LLC*
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 Label
101.PRE	XBRL Taxonomy Extension Presentation

*       Certain portions of the Exhibit have been omitted based upon a pending request for confidential treatment filed by us with the SEC. The omitted portions of the Exhibit have been separately filed by us with the SEC

21

SIGNATURES

Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

	GTX CORP
Date: November 14, 2016	By:	/s/ ALEX MCKEAN
		Alex McKean,
		Chief Financial Officer (Principal Financial Officer)
Date: November 14, 2016	By:	/s/ PATRICK BERTAGNA
		Patrick Bertagna,
		Chief Executive Officer

22

EX-10.1

Text Marked By [* * *] Has Been Omitted Pursuant To A Request For Confidential Treatment And Was Filed Separately With The Securities And Exchange Commission.

DEFINITIVE AGREEMENT

Effective as of June 16, 2016 (“Effective Date”), this definitive agreement (“Agreement”) is entered into by and between Inventergy Innovations, LLC, Inc., a California Limited Liability Corporation with a place of business at 900 E. Hamilton Avenue, Suite 180, Campbell, CA 95008 (“Inventergy”), and Global Trek Xploration, a California Corporation with a place of business at 117 W. 9TH Street, Suite 1214, Los Angeles, California 90015 (“GTX”); each of these entities is to be considered a “Party” to this Agreement.

1. RECITALS

WHEREAS:

● GTX owns a number of patents and patent applications;

● Inventergy has expertise in intellectual property monetization; and

● The Parties wish to establish a relationship where GTX’s Patents (defined below) will be assigned to an Entity (also defined below) for purposes of monetization, with terms specified below governing issues relating to the establishment and management of this Entity, and associated revenue share;

NOW, THEREFORE, the Parties agree as follows.

2. SUMMARY

This summary is provided as an aid to understanding the Agreement; in the event of any conflict or inconsistency with the terms set forth below, the terms which follow this summary are to predominate.

GTX is engaging Inventergy to monetize GTX’s Patents. Upon signing this Agreement, the Patents identified in Exhibit A will be assigned to an Inventergy subsidiary (i.e., the Entity), with Inventergy assigning a 45% interest in the Entity to GTX and also making a sequence of payments to GTX (identified in Section 4.4 below). Monetization will be controlled by Inventergy as the managing party, with Inventergy either consulting with GTX or required to obtain approval of GTX for specified actions.

Once this Agreement is signed, GTX will not be able to terminate this Agreement unless (a) the patent monetization efforts should fail to meet specified License Goals (defined below), or (b) Inventergy should materially breach its obligations to GTX. The payments specified above and in Section 4.4 below represent a walk-away obligation of Inventergy limit of liability, subject to payment of any GTX’s share of any actually-collected royalties for monetization efforts substantially launched or completed prior to termination. Should this Agreement be terminated, Inventergy shall cause the Entity to transfer the patents listed in Exhibit A back to GTX or GTX’s designee.

Inventergy/GTX, Page 1 of 25

Inventergy Initials: ________

GTX Initials: ________

3. DEFINITIONS

3.1	“Confidential Information” is defined below in Section 8.1.
3.2	“Consulting Agreement” is defined below in Section 6.1.
3.3	“Costs ” are defined below in Section 5.3.
3.4	“Disclosing Party” is defined below in Section 8.1.
3.5	“Dispute Resolution Process” is defined below in Section 11.1.
3.6	“Effective Date” is defined above in the first paragraph of this Agreement.
3.7	“Entity” means a corporate entity to be established and named by Inventergy prior to or upon entry in to this Agreement which will serve as a holding company for the Patents. The Entity will initially be created as a 100% subsidiary of Inventergy and be created in a manner of a format of Inventergy’s choosing (e.g., LLC, LLP, C Corp., etc., under the laws of a jurisdiction to be selected by Inventergy).
3.8	“GTX” is defined in the first paragraph of this Agreement.
3.9	“Inventergy” is defined in the first paragraph of this Agreement.
3.10	“Mixed Revenue” is defined below in Section 5.4.
3.11	“Net Revenue” is defined below in Section 5.3.
3.12	“Notice” is defined below in Section 12.1.
3.13	“Patents” means (a) those patent applications and/or patents listed in Exhibit A hereto, (b) all patent applications or patents not listed in Exhibit A which, now or in the future, are owned by or controlled by GTX, and which claims or is amended to claim an invention relating to tracking and/or tracking devices (but not including claims limited to footwear), (c) all continuations, continuations-in-part, counterparts, divisions, reexaminations, reissues, utility conversions, foreign counterpart applications, PCT applications, renewals or other documents that claim priority to, or a common priority with or are otherwise derived from any of the foregoing, and (d) all similar rights on a worldwide basis to the foregoing, including by way of example (but not limitation) any inventor’s certificate, utility model, registered invention.
3.14	“Patent Revenue” is defined below in Section 5.3.
3.14	“Receiving Party” is defined in Section 8.1, below.

Inventergy/GTX, Page 2 of 25

Inventergy Initials: ________

GTX Initials: ________

3.15	“Revenue Share” means, in the case of Inventergy, fifty-five percent (55%) of Net Revenue for a calendar year quarter, and in the case of GTX, forty-five percent (45%) of Net Revenue for the calendar year quarter.
3.16	“Substantially Completed Monetization Effort” means any of (a) a patent license or sale where discussion and/or negotiation has proceeded to the point where an agreement draft, letter of intent, a terms sheet or other list of deals points, has been exchanged, including any situation where an agreement to provide a patent license or sale has in fact been executed, or (b) a lawsuit has been filed for infringement of one or more of the Patents.
3.17	“Termination” is defined below in Section 5.1.

4. PATENT TRANSFER; ENTITY OWNERSHIP AND MANAGEMENT

4.1	Patent Transfer. GTX hereby assigns all right, title and interest in and to the Patents, on a worldwide basis, to the Entity. GTX further agrees to confirm such assignment using a form substantially similar to that appearing in Exhibit B, which it will execute concurrently with entry into this Agreement. For avoidance of doubt, the Parties stipulate that such assignment conveys to the Entity all right, title and interest in and to the Patents, including the exclusive right to sue and the exclusive right to grant licenses under the Patents, and right to recover future and past damages for infringement, and that GTX retains no right to grant licenses to or to sue for infringement of the Patents, whether for past damages or otherwise. In connection with such Assignment, and in future support of monetization efforts by the Entity, GTX agrees to execute such additional documentation and to take other acts as reasonably deemed necessary by Inventergy and/or the Entity in order to assign the Patents in the Entity and to record the Entity’s interest in the Patents, and to otherwise cooperate as necessary in the prosecution, maintenance and assertion of the Patents by the Entity. Further, the obligation of GTX to assign Patents on an ongoing basis is expressly agreed to be a continuing obligation for GTX inventions that result from collaboration with Inventergy (or the Entity). Such inventions are to be assigned to the Entity under the terms of this Agreement. In addition, any Inventergy inventions as a result of collaboration with GTX as well as any patents or patent applications derived from the specifications of the initial transferred intellectual property listed in Exhibit A will also be assigned to the Entity under the terms of this Agreement.
4.2	Entity Ownership. Inventergy hereby transfers to GTX a forty-five percent (45%) ownership interest in the Entity to GTX as of the Effective Date. Inventergy shall retain a fifty-five (55%) ownership interest in the Entity following the Effective Date.
4.3	Entity Management. The Entity shall act as a holding company for the Patents and shall be managed by Inventergy as follows.

Inventergy/GTX, Page 3 of 25

Inventergy Initials: ________

GTX Initials: ________

4.3.1

Inventergy shall have exclusive responsibility for direction of, and sole control over, the Entity’s actions related to (a) prosecution of the Patents, in all jurisdictions (including without limitation, country selection, claims selection and preparation and filing of continuation/divisional filings), (b) selection of counsel to represent the Entity, (c) maintenance of the Patents, (d) licensing of the Patents (other than for exclusive licenses, see below), and related negotiation and terms, (e) assertion of any of the Patents, including decisions on parties to approach and any litigation and/or settlement relating to the Patents, and (f) any other litigation or action involving any of the Patents, including without limitation the conduct and/or settlement or resolution of any inter-partes reexamination, declaratory judgment action or other proceeding relating to the validity and/or infringement of a Patent; GTX’s approval will not be required for any of these things. However, notwithstanding the foregoing, Inventergy will use reasonable efforts to confer with GTX prior to consummation of licenses by the Entity, and prior to institution by the Entity of any litigation for infringement of the Patents. Inventergy shall be responsible for fronting all expenses relating to (a)-(f) above. Inventergy may also engage one or more personnel of GTX to act as a consultant in support of patent prosecution or monetization efforts, as further described below in Section 6.1; generally speaking, such services shall be provided upon request of Inventergy, for example, to answer questions of outside counsel relating to patent prosecution which cannot be answered by Inventergy, assist with patent monetization strategy and otherwise to assist monetization efforts by providing, for example, market information and analysis and/or information regarding purportedly infringing products.

4.3.2

Notwithstanding the previous section, approval of both Parties is required (a) for any sale or transfer of any of the Patents by the Entity, and/or (b) the granting of an exclusive license under any of the Patents by the Entity, and/or (c) any settlement which concedes invalidity of a Patent. Should the Parties be unable to agree on such approval, either Party shall be entitled to initiate a Dispute Resolution Process as provided below.

4.4 Payment By Inventergy. In consideration for the assignment of the Patents as provided above, Inventergy shall pay GTX as follows:

(a)	$25,000 (US) by June 30, 2016;
(b)	$25,000 (US) by August 25, 2016
(c)	$75,000 (US) by September 25, 2016; and
(d)	$25,000 (US) by November 25, 2016.
(e)	$100,00 (US) by December 25, 2016

GTX shall be responsible for any taxes relating to the foregoing. Inventergy may request electronic transfer instructions so as to effectuate “paperless” payment of the above amounts.

Inventergy/GTX, Page 4 of 25

Inventergy Initials: ________

GTX Initials: ________

4.5 Nature Of Inventergy’s Payment. For avoidance of doubt, the Parties stipulate to the following:

(a)

The amounts represented in Section 4.4 shall be due and payable irrespective of whether any royalties are collected for licensing or assertion of any of the Patents; and

(b)

The pertinent amounts stated in Section 4.4 up through the point of providing any Notice of Termination represent a walk away position (i.e., limit of liability) for Inventergy, subject to any Royalty Share owed to GTX for royalties actually collected which are attributable to any Substantially Completed Monetization Effort before Termination, and subject to the other provisions of the termination section, below.

● Example - Inventergy elects to terminate on July 5, 2016 and provides Notice of Termination on this date; in this event, Inventergy would be obligated to pay GTX $25,000 as provided above, and to cause the Entity to transfer the Patents back to GTX, but would not owe the other payments referenced above because it terminated on a date before such payments were due; if a licensing deal was signed prior to Termination, the Parties would continue to divide any Net Revenue whenever received for such Substantially Completed Monetization Effort according to the Parties’ respective Revenue Shares.

5. TERMINATION, MINIMUM QUARTERLY PAYMENTS, COMPUTATION OF REVENUE SHARES, AND LICENSE GOALS

5.1 Termination.

(a)	By Inventergy: Inventergy can terminate this Agreement upon fifteen (15) days’ Notice at any time, with or without cause, but no earlier than 90 days after the Effective Date (if without cause).
(b)	By GTX: GTX can terminate this Agreement only for cause, upon fifteen (15) days’ Notice, (i) for failure to achieve License Goals (as provided below), or (ii) upon material breach by Inventergy, provided that GTX provides Inventergy with Notice of such breach and affords Inventergy fifteen (15) days’ opportunity to cure prior to issuing Notice of Termination. In the event that GTX provides Notice of Termination, Inventergy shall be entitled during such fifteen (15) day Notice period to initiate the Dispute Resolution Process (see below) and any such Termination shall be stayed pending completion of the Dispute Resolution Process. This Agreement shall not be terminated unless such Process results in a finding that Termination is indeed justified according to the terms provided above.
(c)	Effect of Termination: Subject to assignment to the Entity of the Patents as provided above, in the event of Termination, (i) Inventergy shall pay to GTX the amounts as specified in Section 4.4 above, to the extent such amounts have not already been paid, as owed up through the date that the Notice of Termination is provided; (ii) Inventergy shall pay to GTX its share of Net Revenue actually collected by the Entity (see the Net Revenue provisions, below), and (iii) Inventergy shall promptly cause the Entity to transfer and assign back to GTX or its designee all right, title and interest in each of the Patents, consistent with what was specified above in Section 4.1, including all (sole) responsibility for future prosecution and maintenance of the Patents following Termination, but not including right to receive royalties/damages for any Substantially Completed Monetization Effort. Following Termination, should additional royalties or other income be received by either Inventergy or GTX which is attributable to any Substantially Completed Monetization Effort, such additional amounts shall be treated as Patent Revenue (see below) by the Party receiving such Patent Revenue, with the receiving Party performing reimbursement as indicated below and paying out to the other Party its respective Revenue Share (although being offset against any previous advance paid according to the terms of Section 5.2 below); in other words, Termination shall not deprive a Party of a continuing right to its Revenue Share for transactions for Substantially Completed Monetization Efforts at the time of Termination, to the extent that associated Patent Revenues are received following Termination.

Inventergy/GTX, Page 5 of 25

Inventergy Initials: ________

GTX Initials: ________

5.2 GTX Revenue Share Advance. Inventergy agrees that, until it provides Notice of Termination, GTX will receive a cumulative Revenue Share amounting to not less than ***US per calendar year quarter, beginning January 1, 2017, with amounts being payable in the middle of the quarter (i.e., on February 15, May 15, August 15 and November 15, respectively). To the extent that collected Patent Revenue does result in GTX receiving such a running Revenue Share, at a minimum, Inventergy shall provide an advance to GTX to make up the difference which will later be offset against Revenue Share which is paid to GTX. It is agreed that such advances are subject to a ***US cap. If GTX has already received Revenue Share which exceeds its cumulative guarantee, it shall not be due an advance. Once any combination of minimum advance or Revenue Share of ***US in the aggregate has been paid to GTX, there will be no obligation for further advances to be paid. Finally, in the event that either Party provides Notice of Termination, no additional quarterly advances will be due.

● Example 1: The Entity receives ***US of Net Revenue in Q4CY2016, but receives no further Net Revenue until after CY2017. In such a case, GTX would be paid ***US as its Revenue Share on February 15, 2017, and would receive a ***US payment on May 15, 2017 (representing the difference of 2 quarters* ***US, minus Revenue Share paid to date to GTX).

● Example 2: Assume relative to Example 1 that the Entity further receives ***US additional Net Revenue on December 20, 2017 and receives no further Net Revenue during CY2018-2025; Inventergy would pay ***US to GTX on August 15, 2017 and November 15, 2017, and then on February 15, 2018, would pay ***US to GTX (GTX would have already received ***US in advances not yet offset against its Revenue Share, and so this would be deducted from its share of the ***US revenue). GTX in this example would not receive any more quarterly advances until January 15, 2022, when it would receive ***US as its last quarterly advance (i.e., at this point, it would have received cumulative ***US Revenue Share but would have an aggregate Revenue Share guarantee that becomes ***US on January 15, 2022). Because it would have effectively received ***US of Revenue Share at that point, no further quarterly advances would thereafter be payable.

Inventergy/GTX, Page 6 of 25

Inventergy Initials: ________

GTX Initials: ________

● Example 3 - Entity receives an aggregate of ***US Patent Revenue during Q2 of CY2017, and there are outstanding, accrued reimbursement claims of ***US (including ***US fronted by Inventergy and ***US fronted by GTX), a minimum quarterly payment of ***US which was already paid to GTX during Q1CY2017 and another minimum quarterly payment which would ostensibly be due in Q2CY2017; in such a case, of the ***US Patent Revenue received by the Entity:

a) ***would be reimbursed to Inventergy

b) ***would be reimbursed to GTX

leaving ***US Net Revenue of which ***US would be due to GTX, but reduced by the ***prepayment to ***. If no further Patent Revenue was received during the following four quarters, the minimum quarterly payments due to GTX over these next quarters would be ***US, ***US, ***US and ***US respectively.

5.3 Calculation Of Revenue Shares.

(a) Patent Revenue: Revenue from licenses under the Patents, sales of one or more of the Patents, and/or other assertion of the Patents (including litigation), hereinafter “Patent Revenue,” received during the prior calendar year quarter will be handled as follows.

(1) Patent Revenue shall first be applied to reimburse a Party that has paid for patent prosecution or monetization costs (“Costs”), including without limitation patent prosecution costs (e.g., filing fees, maintenance fees, outside counsel fees, etc.), fees for third party services (including GTX’s Consulting Services, but only to extent that any fees or costs beyond the stock grant are paid), expert fees, outside counsel fees, etc.), and operating expenses of the Entity (e.g., marketing, payroll, taxes, etc.), substantially as follows

● Monies received during the previous calendar quarter will be accrued and used to reimburse Inventergy for Costs to the extent fronted pursuant to Section 4.3.1, above,

● Remaining monies will then be used to reimburse the Entity for Costs to the extent that such have been paid directly by the Entity, and

● Notwithstanding the foregoing, Cost reimbursement under this Section 5.3.(a)(2) as provided above shall be capped at fifty percent (50%) of Patent Revenue received for the previous calendar quarter, but any Costs above this amount are to be carried over and accrued from quarter-to-quarter; and

(2) Following allocation of Patent Revenue to reimbursement of Costs, remaining “Net Revenue” will then be paid out following close of the pertinent calendar quarter (e.g., on May 15 for Q1, August 15 for Q2, November 15 for Q3 and February 15 for Q4) to the Parties according to respective Revenue Share, deducting from GTX’s share any previously paid quarterly advances to the extent not already offset against GTX’s Revenue Share.

Inventergy/GTX, Page 7 of 25

Inventergy Initials: ________

GTX Initials: ________

(3) The Revenue Share portion due to GTX will be distributed as follows:

● Within 2 weeks after Inventergy receives the Patent Revenue, Inventergy will provide GTX a notice of the receipt of funds and a statement of Inventergy Costs.

● During the following two weeks GTX will provide Inventergy the GTX Costs and GTX and Inventergy intend to come to an agreement on the allocated Costs and resultant final allocation of funds – which will be transferred within 5 business days of agreement.

● If the parties cannot agree by the end of this two week period, then undisputed portions will be transferred within 5 business day from that point.

● The disputed portion will be determined using the Dispute Resolution Process

(b)

Mixed Revenue: Should income be received which is both attributable to (1) a license under the Patents, a sale of one or more of the Patents, or other monetization one or more of the Patents, and (2) a sale, license or other monetization of other intellectual property not contributed by GTX to the Entity pursuant to Section 4.1 above, then Parties will meet and agree to allocate a portion of such “Mixed Revenue” which is attributable to the Patents. If the Parties cannot agree upon allocation within thirty (30) days or the next calendar quarter end (whichever is longer), then either Party may initiate the Dispute Resolution Process (as provided below) in order to obtain an allocation of such Mixed Revenue to the Patents.

c)

Finance: The Entity shall produce 30 days after the end of each calendar quarter an itemized report of the revenue received, the monetization expense allocations and the funds distributed. GTX may request with a 10 day notice an audit of the records for these reports, but no more often than twice a calendar year.. All expenses for the audit shall be covered by GTX unless there is a discrepancy of 5% or more at which point such audit expenses shall be added to the total of the remedies and shall be paid by Inventergy.

5.4 License Goals. The Parties anticipate that the Entity will generate Patent Revenues such that GTX is paid a cumulative Revenue Share (including minimum quarterly payments) of (1) ***US by [***], and (2) ***US by [***].

6. CONSULTING SERVICES

6.1 Concurrent with entry into this Agreement, GTX will execute the Consulting Agreement Attached hereto as Exhibit C to provide consulting services. GTX will, as specified in the Consulting Agreement, keep detailed written records of hours worked to the nearest quarter of an hour and should submit these to Inventergy in writing, with the expectation that GTX will provide twenty man-hours per month, on average, for eighteen months. The Parties acknowledge that this hours total represents an average, and there may be some months when significant more work is expected from GTX (e.g., 50 man hours) and other months where it is less. Should GTX’s work exceed 25 man-hours in any given calendar month, GTX should alert Inventergy in writing as soon as possible.

Inventergy/GTX, Page 8 of 25

Inventergy Initials: ________

GTX Initials: ________

6.2	Inventergy agrees to compensate GTX for the consulting services set forth above by transferring to GTX 42,500 shares of restricted common stock in Inventergy Global, Inc., with 1/6th of this stock vesting at the close of each calendar quarter (e.g., October 1, January 1, etc.). GTX will be responsible for all taxes relative to this vesting and/or stock, and acknowledges that such stock or other rights or warrants may constitute restricted stock and may be subject to a holding period and/or withholding as provided by applicable law. This transfer will be the only compensation for the services to be provided under the Consulting Agreement, and GTX is to be solely responsible for all wage and hour issues associated with work performed by its personnel. As between Inventergy and GTX, all references to compensation in the Consulting Agreement shall be deemed to refer to such stock.
6.3	In the event of Termination of the Consulting Agreement for material breach or otherwise according to its terms, GTX shall keep any previously vested stock in Inventergy Global, Inc.; if such Termination is effectuated by Inventergy without cause, vesting shall be accelerated for the remaining (unvested) portion of the 42,500 shares.
6.4	At 4-month intervals, the Parties will review the number of man-hours provided by GTX for consulting services, and shall discuss a revision to the compensation provided by Section 6.2 if the average man-hours per month provided by GTX since the start of providing consulting services exceeds 25.

7. LICENSES

7.1 Non-Exclusive License To GTX. Subject to assignment of the Patents to the Entity as provided above, Inventergy shall cause the Entity to execute a non-exclusive, non-sublicensable license to make, use and sell products back to GTX, in the substantial form of Exhibit D.

8. CONFIDENTIAL INFORMATION

8.1 Confidential Information. “Confidential Information” means information disclosed by one Party (“Disclosing Party”) to the other Party (“Receiving Party”) relating to the Disclosing Party’s (or the Entity’s) business and/or technology (including, without limitation, reports, emails, specifications, computer programs, technical drawings, designs, financials, proposals, and other forms or embodiments of data or information), PROVIDED that such information is (1) if disclosed in tangible form, is conspicuously marked “confidential,” “proprietary” or the like, (2) if disclosed in non-tangible form, is both identified as confidential at the time of disclosure and confirmed in writing within thirty (30) days of the disclosure, or (3) of a nature where a reasonable person would have, under the circumstances, viewed the information in question as confidential or proprietary. Notwithstanding the foregoing, nothing will be considered “Confidential Information” to the extent such information (a) is already in the public domain, or becomes part of the public domain, through no fault of a Receiving Party or its personnel, (b) is rightfully received from a third party without any obligation of confidentiality or secrecy, or (c) is independently produced or developed by personnel of the Receiving Party having no direct or indirect access to Confidential Information.

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Inventergy Initials: ________

GTX Initials: ________

8.2

Obligations. A Receiving Party agrees that it will use reasonable measures to safeguard received Confidential Information against unauthorized disclosure or use, in no event less than those measures it uses for its own information of a like nature. Further, each Receiving Party agrees that it will not share Confidential Information with anyone other than its own employees, consultants and agents having a need to know such information consistent with the purposes of this Agreement, and who are obligated to protect Confidential Information against unauthorized use or disclosure, to the full extent contemplated by this Agreement. A Receiving Party’s obligations will endure for a period of three (3) years following Termination. A Receiving Party’s breach of the aforementioned obligations will be excused to the limited extent that such was compelled by court or governmental order, provided that the Receiving Party informs the Disclosing Party of such order and affords the Disclosing Party (or entity) a reasonable opportunity to intervene, and provided that the Receiving Party uses reasonable efforts to obtain a protective order or other confidential treatment for the compelled information in absence of the Disclosing Party.

8.3

Return of Information. Immediately upon a request by the Disclosing Party at any time, and/or at Termination of this Agreement, the Receiving Party will turn over to the Disclosing Party all Confidential Information of the Disclosing Party and all copies or extracts thereof.

9. WARRANTIES

9.1 By GTX. GTX represents and warrants as follows:

(a)	GTX is the sole owner of and has not assigned any of his rights, title or interest in or to the inventions covered by the Patents; GTX has received and currently holds valid and effective assignments of all such inventors’ rights to the inventions covered by the Patents; and no other entity including without limitation any prior employer of GTX’s personnel or any other third party may claim rights to such inventions;
(b)	No Patent is the subject of any interference, opposition, reexamination, cancellation, protest, challenge or other challenge or adversarial proceeding;
(c)	GTX has neither assigned nor granted any license or other rights to any of the Patents and is under no obligation to grant any such license or rights to any third party;
(d)	GTX, to the best of its knowledge, is not aware or any uncited prior art, prior sale or use, or other defect which would render any of the Patents invalid or unenforceable; and
(e)	There are no outstanding liens, encumbrances, third party rights, agreements or understandings of any kind, whether written, oral or implied, regarding the Patents or which are otherwise in conflict with any provision of this Agreement.

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Inventergy Initials: ________

GTX Initials: ________

9.2 By Both Parties. Each Party warrants that it is a duly organized, valid entity, in good standing, and there it is capable of entering into this Agreement.

10. INDEMNIFICATION; DISCLAIMER OF INDIRECT DAMAGES; LIMIT OF LIABILITY

10.1	Indemnification. GTX agrees that it will defend, indemnify and hold each of the Entity and Inventergy harmless against (a) any assertion that one or more of the Patents has an unlisted inventor, or that any royalty or other share of Patent Revenue is otherwise due or owed to any third party, or (b) any assertion that GTX does not have the power to transfer the Patents to the Entity.
10.2	Disclaimer of Indirect Damages. OTHER THAN TO THE INDEMNIFICATION OBLIGATION SET FORTH ABOVE, IN NO EVENT WILL EITHER PARTY BE LIABLE FOR ANY INDIRECT, PUNITIVE, SPECIAL, INCIDENTAL, OR CONSEQUENTIAL DAMAGES IN CONNECTION WITH OR ARISING OUT OF THIS AGREEMENT, OR FOR LOSS OF PROFITS, LOSS OF DATA, OR ANY OTHER ECONOMIC LOSS, HOWEVER IT ARISES AND ON ANY THEORY OF LIABILITY, WHETHER IN AN ACTION FOR CONTRACT, STRICT LIABILITY, OR TORT (INCLUDING NEGLIGENCE) OR OTHERWISE, WHETHER OR NOT EITHER PARTY OR THEIR AFFILIATES HAVE BEEN ADVISED OF THE POSSIBILITY OF SUCH DAMAGE AND NOTWITHSTANDING THE FAILURE OF ESSENTIAL PURPOSE OF ANY REMEDY.
10.3	Limitation of Liability. OTHER THAN FOR A PARTY’S INDEMNIFICATION OBLIGATIONS HEREIN, NEITHER PARTY SHALL BE LIABLE FOR ANY DAMAGES, RELATING TO THIS AGREEMENT AND THE RELATED AGREEMENTS, IN THE AGGREGATE, IN EXCESS OF THE SUMS SPECIFIED TO BE PAID OR PAYABLE PURSUANT TO THIS AGREEMENT. WITHOUT LIMITING THE FOREGOING, IN NO EVENT WILL INVENTERGY BE LIABLE FOR ANY DAMAGES IN EXCESS OF THE SUM OF (A) THE PAYMENTS SPECIFIED BY SECTION 4.4 UP THROUGH ANY DATE OF PROVIDING NOTICE OF TERMINATION, WITH (B) GTX’S REVENUE SHARE FOR PATENT REVENUE ACTUALLY COLLECTED BY THE ENTITY AND/OR INVENTERGY.

11. DISPUTE RESOLUTION PROCESS; EQUITABLE RELIEF; GOVERNING LAW AND JURISDICTION

11.1 Dispute Resolution Process. In the event of a dispute hereunder, each Party agrees to use the following “Dispute Resolution Process.” The Dispute Resolution Process comprises a process where each Party will initially appoint a representative who will attempt to resolve the dispute; generally speaking, such representative are not necessarily limited to employees of the respective Parties, and it is generally anticipated that each Party may elect to appoint subject matter experts (e.g., patent licensing experts) in order to resolve disputes between them.

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Inventergy Initials: ________

GTX Initials: ________

(a)	The aggrieved Party will provide written Notice to the other Party which (i) details the aggrieved Party’s issue, (ii) explains in detail why the aggrieved Party believes the other Party is acting unreasonably or otherwise out of conformance with the terms of this Agreement, (iii) identifies the resolution proposed by the aggrieved Party, (iv) formally requests initiation of the Dispute Resolution Process, and (v) designates a representative who will participate in the Dispute Resolution Process.
(b)	The other Party will, within two business days after receipt of the aggrieved Party’s written Notice, contact the aggrieved Party to (1) designate a representative who will meet with the aggrieved Party’s representative, and (2) arrange for a time within one week for the Party’s representatives to meet to discuss resolution of the aggrieved Party’s issue.
(c)	At and following such meeting, the two representatives shall attempt to reach mutual written agreement on resolution of the issue; such mutual written agreement shall be binding on the Parties.
(d)	If the Parties are unable to arrive at such a mutual written agreement within two weeks of the aggrieved Party’s written Notice, then the issue shall be escalated to the Parties’ respective CEOs, who shall meet telephonically.
(e)	If the issue still cannot be resolved within two weeks of the aggrieved Party’s written Notice, then the Aggrieved Party may submit its dispute to binding arbitration according to the rules of the AAA, with such arbitration to be before a panel of three arbitrators and held in the County of Santa Clara, California. The arbitration remedy shall not be invocable by any third party, including without limitation any licensee of the Patents (other than GTX).

11.2

Equitable Relief Not Prohibited. The provisions of Section 11.1 above shall not prohibit either Party from seeking equitable relief as necessary to prevent irreparable harm that cannot be adequately monetarily compensated.

11.3

Choice of Law and Jurisdiction. This Agreement shall be governed in all respects by the laws of the State of California applied to contracts made between residents of that State. All disputes arising out of this Agreement shall be subject to the exclusive jurisdiction and venue in the state of California, and the parties consent to the personal and exclusive jurisdiction and venue in the state of California.

12. OTHER

12.1 Notice. Any notice or other communication required to be given hereunder by a Party shall be in writing and shall (a) be delivered to the other Party in person, or (b) transmitted to the other Party by email, facsimile or similar means of electronic communication, or (c) sent to the other Party by registered mail, charges prepaid; as appropriate, such notice or communication shall be addressed to the pertinent signatory indicated below, at the address indicated in the first paragraph of this Agreement, or to a confirmed email address or facsimile number for such signatory and for such Party. Any such notice or other communication shall be deemed to have been given and received on the day on which such was delivered in person or electronically communicated or on the third business day thereafter if sent by registered mail. Either Party may change its address for service at any time by giving notice to the other Party in accordance with this section.

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GTX Initials: ________

12.2	Headings. The section and other headings of this Agreement are included for purposes of convenience only, and shall not affect the construction or interpretation of any of its provisions.
12.3	No Assignment. No Party may transfer, convey, assign or delegate any of its rights or obligations under this Agreement, whether by operation of law or otherwise, without express prior written consent of the other Party. Without limiting the foregoing, this Agreement shall be binding on and shall inure to the benefit of the Parties and their respective legal representatives, successors and assigns.
12.4	Severability. Whenever possible, each provision of this Agreement shall be interpreted in such manner as to be effective and valid under applicable law; should any provision of this Agreement shall be prohibited or invalid under applicable law, such provision shall be ineffective to the extent of such prohibition or invalidity without invalidating the remainder of such provision or the remaining provisions of this Agreement.
12.5	Waiver. No waiver of any provision of this Agreement shall be deemed or shall constitute a waiver of any other provision, whether or not similar, nor shall any waiver constitute a continuing waiver. No waiver shall be binding unless executed in writing by the party hereto making such waiver.
12.6	Entire Agreement; Modification. This Agreement (including the Exhibits hereto) constitutes the entire agreement between the Parties relating to the subject matter hereof. This Agreement supersedes all written or oral, prior and contemporaneous agreements, representations, warranties and understandings of the Parties with respect thereto. No supplement, modification or amendment of this Agreement shall be binding unless executed in writing by both of the Parties.
12.7	Parts and Counterparts. This Agreement may be executed as one document or, alternatively, in two or more identical counterparts; in the latter case, each counterpart shall be deemed to be an original and all of which taken together shall be deemed to constitute the Agreement when a duly authorized representative of each Party has signed a counterpart. The Parties may deliver this signed Agreement by electronic (including email or facsimile) transmission, including by way of non-limiting example, as a PDF attachment. Each Party agrees that such electronic transmission shall have the same force and effect as delivery of original signatures and that each Party may use such electronically-transmitted copies as evidence of the execution and delivery of the Agreement by all Parties to the same extent that an original signature could be used.

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Inventergy Initials: ________

GTX Initials: ________

IT IS SO AGREED, as of the Effective Date set forth above.

By and on behalf of Inventergy:
Signature:
Name:	Joe Beyers
Title:	CEO, Inventergy Innovations, LLC
By and on behalf of GTX:
Signature:
Name:	Patrick E. Bertagna
Title:	Chief Executive Officer, Global Trek Xploration

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Inventergy Initials: ________

GTX Initials: ________

EXHIBIT A

US Serial No.	Pat No.	Filing Date	First Inventor	Title
61/065116	-na-	Feb. 8, 2008	Michael Dibella	System and method for communication with a tracking device
12/322941	8154401	Feb. 9, 2009	Patrick E. Bertagna	System and method for communication with a tracking device
13/443180	8760286	Apr. 10, 2012	Patrick E. Bertagna	System and method for communication with a tracking device
14/313339	9219978	Jun. 24, 2014	Patrick E. Bertagna	System and method for communication with a tracking device
14/961556	-na-	Dec. 07, 2015	Patrick E. Bertagna	System and method for communication with a tracking device

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EXHIBIT B

TRANSFER AGREEMENT

This Agreement, effective as of June 16, 2016 (“Effective Date”), is between Global Trek Xploration, a California Corporation with a place of business at 117 W. 9TH Street, Suite 1214, Los Angeles, California 90015 (“Assignor”), and Inventergy LBS, LLC with a place of business at 900 E. Hamilton Avenue, Suite 180, Campbell, CA 95008 (“Assignee”), (collectively, “Parties”).

1. Assignor has an ownership interest in and to the following patents and patent applications:

US Serial No.	Pat No.	Filing Date	First Inventor	Title
61/065116	-na-	Feb. 8, 2008	Michael Dibella	System and method for communication with a tracking device
12/322941	8154401	Feb. 9, 2009	Patrick E. Bertagna	System and method for communication with a tracking device
13/443180	8760286	Apr. 10, 2012	Patrick E. Bertagna	System and method for communication with a tracking device
14/313339	9219978	Jun. 24, 2014	Patrick E. Bertagna	System and method for communication with a tracking device
14/961556	-na-	Dec. 07, 2015	Patrick E. Bertagna	System and method for communication with a tracking device

The patents and patent applications listed above are hereinafter referred to as “the patents and patent applications”.

Assignor also owns the right to any patent issuing from the patents and patent applications, as well as the rights to any continuation, divisional, continuation-in-part, foreign counterpart, or other patent application or patent that depends for priority from or shares a common priority in an earlier patent application with any of the patents or patent applications; hereafter, these things and the patents and patent applications shall be collectively and individually referred to as the “Assigned Patents.”

2.	Assignee desires to own all of Assignor’s right, title and interest in or to the Assigned Patents, including the right to prepare, file, maintain, prosecute and otherwise exploit any invention identified in any Assigned Patent, on a worldwide basis, in Assignee’s name, and including all applications, continuations, divisionals, continuations in-part, and other rights depending for priority on these things or sharing a common priority with these things, on a worldwide basis.
3.	Accordingly, for good and valuable consideration, receipt of which is hereby acknowledged, Assignor hereby assigns to Assignee all of Assignee’s right, title, and other interest in and to the Assigned Patents.
4.	Assignor further assigns to Assignee all causes of action and associated damages for any and all acts of infringement of Assigned Patents that may have occurred prior to the date of this Assignment. Assignor also hereby assigns to Assignee all right to receive royalties for license of Assigned Patents.

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5.	Assignor shall deliver to Assignee such other endorsements, consents, assignments and other good and sufficient instruments of conveyance and assignment, as Assignee shall reasonably deem necessary or appropriate to vest in Assignee all of Assignor’s right, title and interest in, to and under each Assigned Patent, whether or not explicitly enumerated above in Section 1.
6.	Assignor hereby authorizes and requests the U.S. Patent and Trademark Office and/or every patent office in any other country, as applicable, to record this Assignment and, to the extent it assigns pending applications, to issue all Letters Patent issuing there from to Assignee in accordance with the terms of this Assignment, including to any continuation, divisional, continuation in-part or other application which depends upon or shares common priority with a patent or patent application listed above (whether filed now or in the future).
7.	ALL PATENTS ASSIGNED OR LICENSED PURSUANT HERETO ARE GRANTED “AS IS,” “WHERE IS,” AND WITHOUT ANY REPRESENTATION OR WARRANTY OF ANY KIND EXCEPT THOSE EXPRESSLY STATED HEREIN.
8.	Assignor will not take steps or actions to challenge or impair the validity or enforceability or rights associated with any Assigned Patent.
9.	This Agreement shall be construed and enforced pursuant to the laws of the State of California; the Parties agree to use the courts within the State of California as the exclusive jurisdiction for resolving any dispute relating to this Agreement, and hereby consent to jurisdiction in that State.
10.	This Assignment and all rights granted herein shall inure to the benefit of the successors and assigns of Assignee.

WHEREFORE, the Parties have signed this Agreement effective as of the date first set forth above.

ASSIGNOR	ASSIGNEE
“Global Trek Xploration”	Inventegy LBS, LLC
By:	By:
Name:	Name:	Joe Beyers
Title:	Title:	CEO

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EXHIBIT C

CONSULTING AGREEMENT

Effective June 16, 2016 (“Consultant”) and Inventergy Innovations, LLC (“Company”) agree as follows:

1. Services; Payment; No Violation of Rights or Obligations. Consultant agrees to undertake and complete the Services (as defined in Exhibit A) in accordance with and according to the schedule specified in Appendix 1. As the only consideration due Consultant regarding the subject matter of this Agreement, Company will pay Consultant in accordance with Appendix 1. Unless otherwise specifically agreed upon by Company in writing (and notwithstanding any other provision of this Agreement), all activity relating to Services will be performed by and only by Consultant. Consultant agrees that it will not (and will not permit others to) violate any agreement with or rights of any third party or, except as expressly authorized by Company in writing hereafter, use or disclose at any time Consultant’s own or any third party’s confidential information or intellectual property in connection with the Services or otherwise for or on behalf of Company.

2. Ownership; Rights; Proprietary Information; Publicity.

a. Company shall own all right, title and interest (including patent rights, copyrights, trade secret rights, mask work rights, trademark rights, sui generis database rights and all other intellectual and industrial property rights of any sort throughout the world) relating to any and all inventions (whether or not patentable), works of authorship, mask works, designations, designs, know-how, ideas and information made or conceived or reduced to practice, in whole or in part, by or for or on behalf of Consultant during the term of this Agreement that relate to the subject matter of, or arise out of, or in connection with, the Services or any Proprietary Information (as defined below) (collectively, “Inventions”) and Consultant will promptly disclose and provide all Inventions to Company. Consultant hereby makes all assignments necessary to accomplish the foregoing ownership; provided that no assignment is made that extends beyond what would be allowed under California Labor Code Section 2870 (attached as Exhibit B) if Consultant was an employee of Company. Consultant shall further assist Company, at Company’s expense, to further evidence, record and perfect such assignments, and to perfect, obtain, maintain, enforce and defend any rights assigned. Consultant hereby irrevocably designates and appoints Company as its agents and attorneys-in-fact, coupled with an interest, to act for and on Consultant’s behalf to execute and file any document and to do all other lawfully permitted acts to further the foregoing with the same legal force and effect as if executed by Consultant. Company will have the exclusive right to use all work product provided by Consultant to Company under this Agreement, which is also hereby assigned to Company.

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b. Consultant agrees that all Inventions and all other business, technical and financial information that Consultant develops, or learns, or obtains during the period over which Consultant is to be providing the Services that relate to Company or the business or demonstrably anticipated business of Company or in connection with the Services or that are received by or for Company in confidence, constitute “Proprietary Information” of Company. For avoidance of doubt, Proprietary Information includes without limitation all information relating the identity of and information relating to Company’s vendors, customers and employees, all non-public information relating to Company, or to Company’s products and technology, and all non-public information relating to any work product prepared by Consultant under this Agreement. Consultant will on a perpetual basis hold in confidence and not disclose Proprietary Information or use for Consultant’s benefit or for the benefit of any third party. Consultant’s obligation of non-use and non-disclosure, however, will not extend to information that Consultant can prove (by competent documentary evidence) has become publicly available without restriction through no fault of Consultant. In the event of any breach or threatened breach of the protection obligations stated herein, irreparable harm shall be presumed and Company shall be entitled to seek an injunction and/or seek specific performance without waiving any other remedies available at law or equity. Upon termination and as otherwise requested by Company, Consultant will promptly return to Company all items and copies containing or embodying Proprietary Information, except that Consultant may keep its personal copies of its compensation records and this Agreement. Consultant also recognizes and agrees that Consultant has no expectation of privacy or other right with respect to telecommunications sent using Company’s infrastructure, or to the networking or information processing systems of Company, and that such are to be used exclusively for Company business; this includes, without limitation, stored computer files, email messages and voice messages, created, sent or stored on Company systems. Consultant’s activity, and any files or messages, on or using any of those systems may be monitored at any time without notice and/or may be suspended or deactivated at any time, without notice. Company hereby provides notice, however, that the provisions set forth in this section do not abrogate the immunity set forth in Section 1833 of title 18, United States Code, relating to disclosure of a trade secret to an attorney or court in connection with specified actions.

c. Consultant agrees that notwithstanding any rights of publicity, privacy or otherwise (whether or not statutory) anywhere in the world and without any further compensation, Company may and is hereby authorized to use Consultant’s name in connection with promotion of its business, products and services and to allow others to do so. To the extent any of the foregoing is ineffective under applicable law, Consultant hereby provides any and all ratifications and consents necessary to accomplish the purposes of the foregoing to the extent possible. Consultant will confirm any such ratifications and consents from time to time as requested by Company. If any other person provides any Services or provides services similar to any of those referred to above in this paragraph in connection with the Services, Consultant will obtain the foregoing ratifications, consents and authorizations from such person for Company’s exclusive benefit.

d. If any part of the Services or Inventions or information provided hereunder is based on, incorporates, or is an improvement or derivative of, or cannot be reasonably and fully made, used, reproduced, distributed and otherwise exploited without using or violating technology or intellectual property rights owned by or licensed to Consultant (or any person involved in the Services) and not assigned hereunder, Consultant hereby grants Company and its successors a perpetual, irrevocable, worldwide royalty-free, non-exclusive, sublicensable right and license to exploit and exercise all such technology and intellectual property rights in support of Company’s exercise or exploitation of the Services, Inventions, other work or information performed or provided hereunder, or any assigned rights (including any modifications, improvements and derivatives of any of them).

f. For avoidance of doubt, Consultant may as a general perform services for other persons, provided that such services do not (i) represent a conflict of interest or divided loyalty for Consultant’s obligations under this agreement, (ii) detract from Consultant’s obligation to provide services under this Agreement, (iii) use or disclose any of Company’s Proprietary Information, directly or otherwise, or otherwise breach any provision of this Agreement, or (iv) otherwise violate the intellectual property or other rights of Company.

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3. Warranties and Other Obligations. Consultant represents, warrants and covenants that: (i) the Services will be performed in a professional and workmanlike manner and that none of such Services nor any part of this Agreement is or will be inconsistent with any obligation Consultant may have to others; (ii) all work under this Agreement shall be Consultant’s original work and none of the Services or Inventions nor any development, use, production, distribution or exploitation thereof will infringe, misappropriate or violate any intellectual property or other right of any person or entity (including, without limitation, Consultant); (iii) Consultant has the full right to allow it to provide Company with the assignments and rights provided for herein (and has written enforceable agreements with all persons necessary to give it the rights to do the foregoing and otherwise fully perform this Agreement; (iv) Consultant shall comply with all applicable laws and Company safety rules in the course of performing the Services; and (v) if Consultant’s work requires a license, Consultant has obtained that license and the license is in full force and effect.

4. Termination. If either party breaches a material provision of this Agreement, the other party may terminate this Agreement upon 10 days’ notice, unless the breach is cured within the notice period. Company also may terminate this Agreement at any time, with or without cause, upon 30 days’ notice, but, if (and only if) such termination is without cause, Company shall upon such termination pay Consultant all unpaid, undisputed amounts due for the Services completed prior to notice of such termination. Sections 2 (including without limitation the obligation to preserve Company’s Proprietary Information against non-use and disclosure) through 8 of this Agreement and any remedies for breach of this Agreement shall survive any termination or expiration.

5. Relationship of the Parties; Independent Contractor; No Employee Benefits. Notwithstanding any provision hereof, Consultant is an independent contractor (not an employee or other agent) solely responsible for the manner and hours in which the Services are performed, is solely responsible for all taxes, withholdings and other statutory, regulatory or contractual obligations of any sort (including, but not limited to, those relating to workers’ compensation, disability insurance, Social Security, unemployment compensation coverage, the Fair Labor Standards Act, income taxes, etc.), and is not entitled to participate in any employee benefit plans, fringe benefit programs, group insurance arrangements or similar programs. Consultant agrees to indemnify Company from any and all claims, damages, liability, settlement, attorneys’ fees and expenses, as incurred, on account of the foregoing or any breach of this Agreement or any other action or inaction by or for or on behalf of Consultant. If Consultant is a corporation, it will ensure that its employees and agents are bound in writing to Consultant’s obligations under this Agreement.

6. Assignment. This Agreement and the services contemplated hereunder are personal to Consultant and Consultant shall not have the right or ability to assign, transfer, or subcontract any obligations under this Agreement without the written consent of Company. Any attempt to do so shall be void. Company may freely assign or transfer its rights and obligations under this agreement in whole or part.

7. Notice. All notices under this Agreement shall be in writing and shall be deemed given when personally delivered, or three days after being sent by prepaid certified or registered U.S. mail to the address of the party to be noticed as set forth herein or to such other address as such party last provided to the other by written notice.

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8. Miscellaneous. Any breach of Section 2 or 3 will cause irreparable harm to Company for which damages would not be an adequate remedy, and therefore, Company will be entitled to injunctive relief with respect thereto in addition to any other remedies. The failure of either party to enforce its rights under this Agreement at any time for any period shall not be construed as a waiver of such rights. No changes or modifications or waivers to this Agreement will be effective unless in writing and signed by both parties. In the event that any provision of this Agreement shall be determined to be illegal or unenforceable, that provision will be limited or eliminated to the minimum extent necessary so that this Agreement shall otherwise remain in full force and effect and enforceable. This Agreement shall be governed by and construed in accordance with the laws of the State of California without regard to the conflicts of laws provisions thereof. In any action or proceeding to enforce rights under this Agreement, the prevailing party will be entitled to recover costs and attorneys’ fees. Headings herein are for convenience of reference only and shall in no way affect interpretation of the Agreement. This Agreement integrates and supersedes any prior and/or contemporaneous agreements and/or discussions between the parties. This Agreement incorporates the provisions of Appendix 1, but in the event of conflict between Appendix 1 and the terms already set forth in this Agreement, the terms already set forth in this Agreement shall prevail.

9. Arbitration. Any controversy or claim (except those regarding Inventions, Proprietary Information or intellectual property) arising out of or relating to this Agreement, or the breach thereof, shall be settled by arbitration in accordance with the Commercial Arbitration Rules of the American Arbitration Association, and judgment on the award rendered by the arbitrator may be entered in any court having jurisdiction thereof, provided however, that each party will have a right to seek injunctive or other equitable relief in a court of law. The prevailing party will be entitled to receive from the nonprevailing party all costs, damages and expenses, including reasonable attorneys’ fees, incurred by the prevailing party in connection with that action or proceeding, whether or not the controversy is reduced to judgment or award. The prevailing party will be that party who may be fairly said by the arbitrator(s) to have prevailed on the major disputed issues. Consultant hereby consents to the arbitration in the State of California in the county of Santa Clara.

Global Trek Xploration		Inventergy Innovations, LLC
By:		By:
			Joe Beyers
			CEO_____________________________________
			900 E. Hamilton Avenue, Suite 180 ______________
			Campbell, CA 95008 _______________________
	Printed (Name, Title and Address)		Printed (Name, Title and Address)

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APPENDIX 1 TO CONSULTING AGREEMENT

Consultant will provide services as may be requested by Inventergy Innovations, LLC (“Inventergy”) in exchange for 42,500 shares of restricted common stock of Inventergy Global, Inc., vested at the rate of 1/6^th per calendar quarter; Consultant acknowledges that this stock may be restricted securities having an applicable minimum holding period.

All services are to be provided by individuals who are employees of Consultant and who are specified to, and agreed by Inventergy, in advance. Consultant shall keep detailed time records to the nearest quarter of an hour and shall inform Inventergy if, in any calendar month, Consultant’s hours become greater than 25 or are expected to be more than 25, and shall obtain Inventergy’s approval to exceed such number. Consultant shall report hourly amounts to Inventergy on a monthly basis.

Inventergy shall have no obligation to reimburse Consultant’s expenses or pay any other form of compensation except as may be agreed upon by Inventergy in writing in advance.

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EXHIBIT D

LICENSE AGREEMENT

This license agreement (“License Agreement”) is entered into effective July 1, 2016 (“Effective Date”) by and between Inventergy LBS, LLC with a place of business at 900 E. Hamilton Avenue, Suite 180, Campbell, CA 95008 (“Entity”), and Global Trek Xploration, a California Corporation with a place of business at 117 W. 9TH Street, Suite 1214, Los Angeles, California 90015 (“GTX”); each of these entities is to be considered a “Party” to this License Agreement.

WHEREAS, GTX has transferred certain patents and patent applications (“Patents”) to the Entity, and wherein Entity, in partial consideration for such transference has agreed to provide a non-exclusive, limited license under the Patents back to GTX, NOW, THEREFORE, the Parties agree as follows.

For good and valuable consideration, the receipt of which is hereby acknowledged, Entity hereby grants to GTX a personal, nonexclusive, nontransferable, irrevocable, worldwide license under the Patents to make, use, have made for resale by GTX, to sell, offer for sale, import and otherwise dispose of “Licensed Products.” As used herein, “Licensed Products” means products that are any of (1) internally used by GTX, (2) sold under GTX’s name which, absent a license, would infringe one or more of the Patents, or (3) those made by GTX (OEM products of GTX where all aspects of manufacture and design are controlled by GTX) (includes manufacture on behalf of GTX) but shipped under a third party label. No other, further or different license is hereby granted or implied, and GTX shall have no right to grant sublicenses to the Patents to any entity, nor to exclude others from practice of any invention claimed by any of the Patents. Entity and GTX intend for this license to be limited to the Patents transferred by GTX to Entity, and GTX expressly acknowledges that it is not being granted and has not bargained for any rights, implied or otherwise, to any other patents or intellectual property, including without limitation, any patents or other intellectual property owned or controlled by Inventergy, now or in the future, under any legal or equitable theory, including patent exhaustion. For clarity, GTX’s sale of Licensed Products shall not convey to GTX’s customers any right or license (express or implied or under other legal doctrine, such as patent exhaustion) under any claim of any Patent where such claim is not directly infringed by the Licensed Product as sold or transferred by GTX.

In the event GTX acquires 100% of another business entity, a third party line of business or substantially all of the assets of a third party line of business, that is, in each case, related to the manufacture, use, sale, offer for sale, importation and/or disposition of products that are substantially similar to and/or related to the Licensed Products, and which would also infringe one or more of the Patents absent a license, (collectively, “Acquired Products”), such Acquired Products shall be considered Licensed Products.

In the event of a change of control of GTX, GTX’s volume of Licensed Products shall be limited going forward to an amount equal to 120% of GTX’s sales of Licensed Products in the last preceding full year in which Licensed Products were sold, and additional volumes of Licensed Product shall be licensable subject to execution of a license agreement with the Entity which provides for royalty or other license fees and obligations for volume in excess of the 120% metric, with terms similar to those generally agreed to by other licensees of the Patents. “Change of control” as used herein means:

(a)	an acquisition by any person or entity of more than 50% of the combined voting power of a GTX’s then outstanding voting securities; or
(b)	the consummation by GTX of any of

Inventergy/GTX, Page 23 of 25

Inventergy Initials: ________

GTX Initials: ________

i.	a merger, consolidation or reorganization involving GTX, unless such merger, consolidation or reorganization meets either of the following requirements (A) the stockholders of GTX immediately before such merger, consolidation or reorganization, own, directly or indirectly, immediately following such merger, consolidation or reorganization, greater than at least percent 50% of the combined voting power of the outstanding voting securities of the corporation resulting from such merger, consolidation or reorganization; or (B) the individuals who were members of GTX’s board of directors or similar governing body immediately prior to the execution of the agreement providing for such merger, consolidation or reorganization constitute at least a majority of the members of the board of directors of the surviving corporation immediately following the consummation of such merger, consolidation or reorganization,
ii.	a complete liquidation or dissolution of GTX, or
iii.	an agreement for the sale or other disposition of all or substantially all of (A) the assets of GTX or, (B) the business of GTX.

In the event GTX divests a line of business or substantially all of the assets of a GTX line of business to a third party, GTX shall have the option to a) have such divested line of business cease to enjoy the benefits of this License Agreement on the effective date of such a divestment, and, therefore, any activity of the divested line of business occurring on or after the effective date of such a divestment will not be licensed nor entitled to any of the benefits of this License Agreement; or b) assign the license subject to all of the terms of this License Agreement with the divested line of business to such third party, and therefore not retain any license as to GTX’s own line of business or products, HOWEVER, with respect to any such assignment, the total aggregate sales revenue of the divested line of business after the divestiture will only be licensed up to an amount equal to 120% of GTX’s sales of Licensed Products in the divested line of business in the last preceding full year in which Licensed Products in the divested line of business were sold. Should the divested line of business wish to make, use or sell additional volumes of Licensed Product, such shall be licensable from the Entity subject to execution of a license agreement with the Entity which provides for royalty or other license fees and obligations for volume in excess of the 120% metric, with terms similar to those generally agreed to by other licensees of the Patents.

GTX understands and acknowledges that the covenants and licenses granted in this License Agreement are intended to cover only products of GTX and are not intended to and do not cover manufacturing activities that GTX may undertake on behalf of third parties. Accordingly, notwithstanding anything to the contrary in this License Agreement and without limiting the generality of the preceding sentence, no licenses are granted or otherwise provided GTX to manufacture or have manufactured products as a foundry or contract manufacturer for a third party or to distribute such products to such third party or to customers of such third party.

GTX will not take steps or actions to challenge or impair the validity or enforceability or rights associated with any of the Patents.

The Entity makes no representations regarding ability to practice any invention or technology under the Patents. Without limiting the foregoing, Entity disclaims any representation or warranty that any technology may be made, used or sold under the Patents either in a manner that is safe, or in a manner that is free from claims of third parties. Any actions or omissions of GTX, whether or not associated with the Patents, are to be at GTX’s sole risk and exposure.

Inventergy/GTX, Page 24 of 25

Inventergy Initials: ________

GTX Initials: ________

IN NO EVENT WILL THE ENTITY BE LIABLE FOR ANY INDIRECT, PUNITIVE, SPECIAL, INCIDENTAL, OR CONSEQUENTIAL DAMAGES IN CONNECTION WITH OR ARISING OUT OF THIS AGREEMENT, OR FOR LOSS OF PROFITS, LOSS OF DATA, OR ANY OTHER ECONOMIC LOSS, HOWEVER IT ARISES AND ON ANY THEORY OF LIABILITY, WHETHER IN AN ACTION FOR CONTRACT, STRICT LIABILITY, OR TORT (INCLUDING NEGLIGENCE) OR OTHERWISE, WHETHER OR NOT EITHER PARTY OR THEIR AFFILIATES HAVE BEEN ADVISED OF THE POSSIBILITY OF SUCH DAMAGE AND NOTWITHSTANDING THE FAILURE OF ESSENTIAL PURPOSE OF ANY REMEDY.

This License Agreement may not be assigned or transferred without Entity’s advance written permission.

This License Agreement shall be construed and enforced pursuant to the laws of the State of California; the Parties agree to use the courts within the State of California as the exclusive jurisdiction for resolving any dispute relating to this Agreement, and hereby consent to jurisdiction in that State.

This License Agreement and all rights granted herein shall inure to the benefit of the successors and assigns of the Entity.

WHEREFORE, the Parties have signed this Agreement effective as of the date first set forth above.

Inventergy LBS, LLC		GLOBAL TREK XPOLORATION
“Entity”		“GTX”
By:		By:
Name:	Joe Beyers	Name:
Title:	CEO	Title:

Inventergy/GTX, Page 25 of 25

Inventergy Initials: ________

GTX Initials: ________

EX-31.1

EXHIBIT 31.1

CERTIFICATIONS PURSUANT TO

SECTION 302 OF

THE SARBANES-OXLEY ACT OF 2002

CERTIFICATION

I, Patrick E. Bertagna, certify that:

1. I have reviewed this Quarterly Report on Form 10-Q of GTX Corp for the period ended September 30, 2016;

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: November 14, 2016
/s/ PATRICK E. BERTAGNA
Name:	Patrick E. Bertagna
Its:	Chief Executive Officer (Principal Executive Officer)

EX-31.2

EXHIBIT 31.2

CERTIFICATIONS PURSUANT TO

SECTION 302 OF

THE SARBANES-OXLEY ACT OF 2002

CERTIFICATION

I, Alex McKean, certify that:

1. I have reviewed this Quarterly Report on Form 10-Q of GTX Corp for the period September 30, 2016;

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: November 14, 2016
/s/ ALEX MCKEAN
Name:	Alex McKean
Its:	Chief Financial Officer (Principal Financial Officer)

EX-32.1

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 of GTX Corp (the “Company”) on Form 10-Q, for the period ended September 30, 2016 as filed with the Securities and Exchange Commission, I, Patrick E. Bertagna, President, Chief Executive Officer and Chairman of the Board of the Company, certify, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 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; and
(2)	The information contained in the Report fairly presents, in all material respects, the financial condition and result of operations of the Company.

Date: November 14, 2016
/s/ PATRICK E. BERTAGNA
Name:	Patrick E. Bertagna
Its:	Chief Executive Officer (Principal Executive Officer)

EX-32.2

EXHIBIT 32.2

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 of GTX Corp (the “Company”) on Form 10-Q, for the period ended September 30, 2016 as filed with the Securities and Exchange Commission, I, Alex McKean, Interim Chief Financial Officer, Treasurer and Secretary of the Company, certify, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 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; and
(2)	The information contained in the Report fairly presents, in all material respects, the financial condition and result of operations of the Company.

Date: November 14, 2016
/s/ ALEX MCKEAN
Name:	Alex McKean
Its:	Chief Financial Officer (Principal Financial Officer)

XML

Document and Entity Information - shares	9 Months Ended
	Sep. 30, 2016	Nov. 14, 2016
Document And Entity Information
Entity Registrant Name	GTX CORP
Entity Central Index Key	0001375793
Document Type	10-Q
Document Period End Date	Sep. 30, 2016
Amendment Flag	false
Current Fiscal Year End Date	--12-31
Entity Filer Category	Smaller Reporting Company
Entity Common Stock, Shares Outstanding		463,330,518
Trading Symbol	GTXO
Document Fiscal Period Focus	Q3
Document Fiscal Year Focus	2016

XML

Consolidated Balance Sheets (Unaudited) - USD ($)	Sep. 30, 2016	Dec. 31, 2015
Current assets:
Cash and cash equivalents	$ 29,945	$ 7,868
Accounts receivable, net	127,421	40,984
Inventory	55,371	57,643
Other current assets	119,993	55,449
Total current assets	332,730	161,944
Property and equipment, net	133,344	131,792
Investment in equity securities	63,325
Intangible assets	18,780	15,000
Total assets	548,179	308,736
Current liabilities:
Accounts payable and accrued expenses	244,746	438,960
Accrued expenses - related parties	295,131	291,451
Deferred revenues	3,255	2,775
Current portion convertible promissory notes, net of discount	626,303	556,250
Derivative liability	224,626
Total current liabilities	1,394,061	1,289,436
Long-term convertible promissory notes, net of discount	156,575	200,000
Long-term convertible promissory notes – related parties	318,671
Total liabilities	1,869,307	1,489,436
Commitments and contingencies
Stockholders' deficit:
Preferred stock, $0.001 par value; 10,000,000 shares authorized; no shares issued and outstanding
Common stock, $0.001 par value; 2,071,000,000 shares authorized; 453,378,517 and 355,431,281 shares issued and outstanding at September 30, 2016 and December 31, 2015, respectively	453,378	355,431
Additional paid-in capital	17,558,328	16,982,932
Accumulated deficit	(19,332,834)	(18,519,063)
Total stockholders' deficit	(1,321,128)	(1,180,700)
Total liabilities and stockholders' deficit	$ 548,179	$ 308,736

XML

Consolidated Balance Sheets (Unaudited) (Parenthetical) - $ / shares	Sep. 30, 2016	Dec. 31, 2015
Statement of Financial Position [Abstract]
Preferred Stock, Par value	$ 0.001	$ 0.001
Preferred Stock, shares authorized	10,000,000	10,000,000
Preferred Stock, shares issued
Preferred Stock, shares outstanding
Common Stock, par value	$ 0.001	$ 0.001
Common Stock, shares authorized	2,071,000,000	2,071,000,000
Common Stock, shares issued	453,378,517	355,431,281
Common Stock, shares outstanding	453,378,517	355,431,281

XML

Consolidated Statements of Operations (Unaudited) - USD ($)	3 Months Ended		9 Months Ended
	Sep. 30, 2016	Sep. 30, 2015	Sep. 30, 2016	Sep. 30, 2015
Income Statement [Abstract]
Revenues	$ 140,423	$ 121,339	$ 312,974	$ 393,425
Consulting income	100,846		188,325
Total revenues	241,269	121,339	501,299	393,425
Cost of goods sold	83,338	91,834	220,300	288,032
Gross margin	157,931	29,505	280,999	105,393
Operating expenses
Wages and professional fees	269,050	353,447	756,150	863,083
General and administrative	54,082	38,206	171,521	171,616
Total operating expenses	323,132	391,653	927,671	1,034,699
Loss from operations	(165,201)	(362,148)	(646,672)	(929,306)
Other income/(expenses)
(Gain) loss on extinguishment of debt	(250)	137,250	(29,577)	105,192
Derivative income	215,502		537,738	13,490
Amortization of debt discount	(213,964)		(623,675)
Interest expense	(11,549)	(41,788)	(51,585)	(79,324)
Total other income/(expenses)	(10,261)	95,462	(167,099)	39,358
Net loss	$ (175,462)	$ (266,686)	$ (813,771)	$ 889,948
Weighted average number of common shares outstanding - basic and diluted	425,868,780	327,554,083	391,714,192	308,100,018
Net loss per common share - basic and diluted	$ (0.00)	$ (0.00)	$ (0.00)	$ (0.00)

XML

Consolidated Statements of Cash Flows (Unaudited) - USD ($)	9 Months Ended
	Sep. 30, 2016	Sep. 30, 2015
Cash flows from operating activities
Net loss	$ (813,771)	$ 889,948
Adjustments to reconcile net loss to net cash used in operating activities:
Depreciation	27,344	2,632
Stock-based compensation	273,135	389,014
(Gain) loss on extinguishment of debt	29,577	(105,192)
Derivative (income) expense	(537,738)	(13,490)
Amortization of debt discount	623,675	68,764
Interest added to debt	27,119
Fair value of common stock received as income	(63,325)
Changes in operating assets and liabilities:
Accounts receivable	(86,437)	(10,650)
Inventory	2,272	38,066
Other current and non-current assets	(90,414)	(57,880)
Accounts payable and accrued expenses	(194,214)	91,520
Accrued expenses - related parties	409,680	55,252
Deferred revenues	480	(74,789)
Net cash used in operating activities	(392,617)	(506,701)
Cash flows from investing activities
Purchase of intangible assets	(3,780)
Purchase of property and equipment	(3,026)	(4,813)
Net cash used in investing activities	(6,806)	(4,813)
Cash flows from financing activities
Proceeds from convertible promissory notes	444,500	512,500
Payments on convertible promissory notes	(23,000)	(3,000)
Net cash provided by financing activities	421,500	509,500
Net change in cash and cash equivalents	22,077	(2,014)
Cash and cash equivalents, beginning of period	7,868	12,168
Cash and cash equivalents, end of period	29,945	10,154
Supplemental disclosure of cash flow information:
Income taxes paid
Interest paid		2,503
Supplementary disclosure of noncash financing activities:
Issuance of stock for accrued expenses-related parties	87,000	229,438
Issuance of common stock for conversion of debt	262,094	342,232
Debt discount on convertible notes payable	89,500
Accrued salaries converted to convertible promissory notes	$ 318,671

XML

Organization and Basis of Presentation

9 Months Ended

Sep. 30, 2016

Organization, Consolidation and Presentation of Financial Statements [Abstract]

Organization and Basis of Presentation

1.       ORGANIZATION AND BASIS OF PRESENTATION

During the periods covered by these financial statements, GTX Corp and subsidiaries (the “Company” or “GTX”) were engaged in businesses that design, develop and sell various interrelated and complementary products and services in the Personal Location Wearable Technology marketplace. GTX owns 100% of the issued and outstanding capital stock of Global Trek Xploration (“GTX California”) and LOCiMOBILE, Inc. Through February 2015, GTX also owned 100% of the issued and outstanding capital stock of Code Amber News Service, Inc. (“CANS”), which it dissolved in February 2015.

Global Trek Xploration designs, develops, manufactures and distributes - hardware, software, connectivity services of Global Positioning System (“GPS”) and Bluetooth Low Energy (“BLE”) monitoring and tracking solutions that provide real-time tracking of the whereabouts of people and high valued assets. Utilizing a miniature quad band GPRS transceiver, antenna, circuitry, battery and inductive charging pad our product(s) can be customized and integrated into numerous products and form factors whose location and movement can be monitored in real time over the Internet through our 24x7 tracking portal or on a web enabled cellular telephone. Our core products and services are supported by an extensive IP portfolio of patents, patents pending, registered trademarks, copyrights, URLs and a library of software source code.

LOCiMOBILE, Inc., has been engaged in of Smartphone application (“App”) development since 2008. With a suite of mobile applications that turn the iPhone, iPad, Android and other GPS enabled handsets into a tracking device which can be tracked from handset to handset or through our tracking portal or on any connected device with internet access. LOCiMOBILE has launched numerous Apps across multi mobile device operating systems and continues to launch consumer and enterprise apps.

Basis of Presentation

The accompanying unaudited consolidated financial statements of GTX have been prepared in accordance with accounting principles generally accepted in the United States for interim financial information and applicable regulations of the U.S. Securities and Exchange Commission. Certain information and footnote disclosures normally included in financial statements prepared in accordance with accounting principles generally accepted in the United States have been omitted pursuant to such rules and regulations. In the opinion of management, all adjustments (consisting only of normal recurring adjustments) considered necessary for a fair statement of financial position and results of operations have been included. Our operating results for the three and nine months ended September 30, 2016 are not necessarily indicative of the results that may be expected for the year ending December 31, 2016. The accompanying unaudited consolidated financial statements should be read in conjunction with our audited consolidated financial statements for the year ended December 31, 2015, which are included in our Annual Report on Form 10-K.

The accompanying consolidated financial statements reflect the accounts of GTX Corp and its wholly owned subsidiaries. All significant inter-company balances and transactions have been eliminated.

Going Concern

The consolidated financial statements have been prepared on a going concern basis which assumes the Company will be able to realize its assets and discharge its liabilities in the normal course of business for the foreseeable future.  The Company has incurred net losses of $813,771 and $889,948 for the nine months ended September 30, 2016 and 2015, respectively, has incurred losses since inception resulting in an accumulated deficit of $19,332,834 as of September 30, 2016, and has negative working capital of $1,061,331 as of September 30, 2016. The Company anticipates further losses in the development of its business.

The ability to continue as a going concern is dependent upon the Company generating profitable operations in the future and/or obtaining the necessary financing to meet its obligations and repay its liabilities arising from normal business operations when they come due. The Company’s ability to raise additional capital through the future issuances of debt or equity is unknown. The obtainment of additional financing, the successful development of the Company’s contemplated plan of operations, or its attainment of profitable operations are necessary for the Company to continue operations. The ability to successfully resolve these factors raise substantial doubt about the Company’s ability to continue as a going concern. The consolidated financial statements of the Company do not include any adjustments that may result from the outcome of these aforementioned uncertainties.

XML

Significant Accounting Policies

9 Months Ended

Sep. 30, 2016

Accounting Policies [Abstract]

Significant Accounting Policies

2.       SIGNIFICANT ACCOUNTING POLICIES

Use of Estimates

The preparation of the accompanying unaudited consolidated financial statements requires the use of estimates that affect the reported amounts of assets, liabilities, revenues, expenses and contingencies. These estimates include, but are not limited to, estimates related to revenue recognition, allowance for doubtful accounts, inventory valuation, tangible and intangible long-term asset valuation, warranty and other obligations and commitments. Estimates are updated on an ongoing basis and are evaluated based on historical experience and current circumstances. Changes in facts and circumstances in the future may give rise to changes in these estimates which may cause actual results to differ from current estimates.

Fair Value Estimates

Pursuant to the Accounting Standards Codification (“ASC”) No. 820, “Disclosures About Fair Value of Financial Instruments”, the Company records its financial assets and liabilities at fair value. ASC No. 820 provides a framework for measuring fair value, clarifies the definition of fair value and expands disclosures regarding fair value measurements. Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability (an exit price) in an orderly transaction between market participants at the reporting date. ASC No. 820 establishes a three-tier hierarchy, which prioritizes the inputs used in the valuation methodologies in measuring fair value:

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

Level 2—Inputs (other than quoted prices included in Level 1) are either directly or indirectly observable for the asset or liability through correlation with market data at the measurement date and for the duration of the asset/liability’s anticipated life.

Level 3—Inputs reflect management’s best estimate of what market participants would use in pricing the asset or liability at the measurement date. Consideration is given to the risk inherent in the valuation technique and the risk inherent in the inputs to the model.

The carrying values for cash and cash equivalents, accounts receivable, other current assets, accounts payable and accrued liabilities approximate their fair value due to their short maturities.

Equity Securities

During the second quarter of fiscal 2016, we received restricted equity securities, which we have classified as “available for sale” securities. Our equity securities are marked to market on a quarterly basis, with unrealized gains and losses being excluded from earnings and reflected as a component of other comprehensive income.

The inputs or methodology used for valuing securities are not necessarily an indication of the risk associated with investing in those securities.

Following are the disclosures related to our financial assets pursuant to ASC No. 820:

	September 30, 2016
	Fair Value		Input Level
Available for sale marketable securities:
Common stock	$	63,325		Level 1

The fair value of our available for sale securities is determined based on quoted market prices for identical securities on a quarterly basis.

Derivative Instruments

Our debt or equity instruments may contain embedded derivative instruments, such as conversion options, which in certain circumstances may be required to be bifurcated from the associated host instrument and accounted for separately as a derivative instrument liability.

Our derivative instrument liabilities are re-valued at the end of each reporting period, with changes in the fair value of the derivative liability recorded as charges or credits to income, in the period in which the changes occur. For bifurcated conversion options that are accounted for as derivative instrument liabilities, we determine the fair value of these instruments using the Black-Scholes option pricing model. This model requires assumptions related to the remaining term of the instrument and risk-free rates of return, our current Common Stock price and expected dividend yield, and the expected volatility of our Common Stock price over the life of the option.

Reclassifications

For comparability, certain prior period amounts have been reclassified, where appropriate, to conform to the financial statement presentation used in 2016. These reclassifications have no impact on net loss.

Recently Issued Accounting Pronouncements

The Financial Accounting Standards Board has recently issued accounting pronouncements, most of which represent technical corrections to the accounting literature or application to specific industries, which are not expected to have a material impact on the Company’s financial position, results of operations or cash flows. We do not believe that the adoption of any recently issued accounting standards will have a material effect on our financial position and results of operations.

XML

Joint Venture and Investment In Equity Securities

9 Months Ended

Sep. 30, 2016

Schedule of Investments [Abstract]

Joint Venture and Investment In Equity Securities

3.       JOINT VENTURE AND INVESTMENT IN EQUITY SECURITIES

On June 16, 2016, the Company entered into a Definitive Agreement with Inventergy Innovations, LLC (“Inventergy”), a subsidiary of Inventergy Global, Inc. (NASDAQ: INVT). The Company partnered with Inventergy to monetize three (3) GTX Patents. Upon signing the Agreement, the Patents were assigned to an Inventergy subsidiary, and Inventergy assigned a 45% interest in the entity to GTX. Inventergy is also obligated to make a sequence of quarterly payments to GTX in 2017, which payments represent non-refundable advances against future royalty and other payments. Pursuant to a non-exclusive license back to GTX, GTX will still retain all use rights of the 3 patents.

In addition to the Definitive Agreement, the Company entered into a Consulting Agreement with Inventergy for a period of eighteen months. The Company was issued 42,500 shares of restricted common stock of INVT, of which 1/6^th of the stock vests at the close of each calendar quarter and Inventergy agreed to make five monthly payments to GTX totaling $250,000 through December 2016 as compensation. As of September 30, 2016, $125,000 of the cash compensation had been recognized. As of September 30, 2016, we owned 42,500 shares of restricted common stock of INVT valued $63,325.

The Company uses the equity method to account for its investment in the Inventergy subsidiary. Under the equity method, the Company recognizes its share of the earnings and losses of the subsidiary as they accrue instead of when they are realized. As of September 30, 2016, the Company’s investment in the subsidiary was $0.

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Related Party Transactions

9 Months Ended

Sep. 30, 2016

Related Party Transactions [Abstract]

Related Party Transactions

4.       RELATED PARTY TRANSACTIONS

In order to preserve cash for other working capital needs, various officers and members of management have agreed to accrue, and defer payment of, portions of their salaries since fiscal 2011.

On September 30, 2016 management has elected to transfer accrued salaries into long-term convertible promissory notes, due on December 31, 2018, the total amount of salaries converted was $318,671. The notes will bear a 10% annual interest rate. Management shall have the right, but not the obligation to convert up to 50% of the amount advanced and accrued interest into shares, warrants or options of common or preferred stock of the Company at $0.01 per share.

As of September 30, 2016 and December 31, 2015, the Company owed $295,131 and $291,451, respectively for such accrued wages.

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Debt

9 Months Ended

Sep. 30, 2016

Debt Disclosure [Abstract]

Debt

5.       DEBT

The following table summarizes the components of our short-term borrowings:

	September 30, 2016			December 31, 2015
Q4 2014 Convertible Notes	$	126,000		$	126,000
Q1 2015 Convertible Notes		60,000			150,000
Q2 2015 Convertible Notes		200,000			200,000
Q3 2015 Convertible Notes		45,000			84,000
Q4 2015 Convertible Notes		-			196,250
Q1 2016 Convertible Notes		140,000			-
Q2 2016 Convertible Notes		302,181			-
Q3 2016 Convertible Notes		507,671			-
Total convertible notes		1,380,852			756,250
Less: Debt discount		(279,303	)		-
Convertible notes, net of debt discount		1,101,549			756,250
Current portion of convertible notes	$	626,303		$	556,250
Long-term convertible notes	$	475,246		$	200,000

 On January 15, 2016, we received an additional installment of $15,000 from an accredited investor relating to the 7.5% Convertible Debenture entered into on October 9, 2015. On April 15, 2016, this note was sold to a private investor pursuant to the Exchange Agreement as described below.

On January 27, 2016, pursuant to a Note Purchase Agreement with an unaffiliated third party (the “Investor”) relating to the sale of an unsecured convertible promissory note and warrant. The third party purchased an additional unit for $25,000 and a principal balance of $30,000. The convertible promissory note is divided into units (“Units”), each in the principal amount of $30,000, with equal installments of $1,000 due sequentially every week until $30,000 has been repaid and warrants to purchase 1,250,000 shares of common stock at an exercise price of $0.015 per share. The convertible promissory notes are due on November 25, 2016, subject to certain conditions and restrictions set forth in the notes. The convertible promissory note has a relative fair value of $23,899 and the warrants has a relative fair value of $6,101 at the date of issuance determined using the Black-Scholes option-pricing model. The assumptions used to calculate the fair market value are as follows: (i) risk-free interest rate of 0.88% (ii) estimated volatility of 171% (iii) dividend yield of 0.00% and (iv) expected life of the warrants of 25 months. The convertible note is convertible into shares of common stock based on the volume weighted average of the closing price per share for the 20 consecutive trading days prior to the conversion date if there is any outstanding principal balance due after the expiration due date. As of September 30, 2016, $5,000 cash installment payments have been made toward lowering the outstanding principal balance. On September 14, 2016, we consolidated all of these Investor’s notes into a single note valued at $120,000. The note is due December 16, 2016 and carries an OID of 20%.

On February 5, 2016, an accredited investor with a convertible note of $30,000, converted their outstanding principal balance into 2,250,000 shares of common stock at a conversion price of $0.015.

On February 8, 2016, we entered into a Note and Share Purchase Agreement with an unaffiliated third party (the “Investor”) relating to the sale of an unsecured convertible promissory note. The convertible promissory note is divided into units (“Units”), each in the principal amount of $30,000. The notes are due on December 31, 2016, subject to certain conditions and restrictions set forth in the notes. The convertible notes are convertible into shares of common stock at $0.01 per share. On February 8, 2016 the Investor purchased two $25,000 units (for a total of $50,000).

During the period ended September 30, 2016, we made a cash payment of $23,000 to an accredited investor to reduce the outstanding balance on his loans.

On March 16, 2016, we entered into a Loan Agreement with an independent accredited investor relating to the sale of a convertible promissory note and warrant. As a result, we issued convertible notes with a total principal balance of $55,000 and warrants to purchase 2,500,000 shares of common stock at an exercise price of $0.0125 per share. The convertible promissory note has a relative fair value of $33,379 and the warrants has a relative fair value of $21,621 at the date of issuance determined using the Black-Scholes option-pricing model. The assumptions used to calculate the fair market value are as follows: (i) risk-free interest rate of 1.05% (ii) estimated volatility of 221% (iii) dividend yield of 0.00% and (iv) expected life of the warrants of 3 years. The Convertible Note carries an original issue discount of 10%, mature on March 16, 2017 with a 12% interest rate and are convertible into common stock of the Company at 60% of the lowest closing price over a five day period immediately prior to but not including the Conversion Date. However, the conversion price shall not be lower than $0.005 per share.

On March 16, 2016, we entered into a Loan Agreement with an independent accredited investor relating to the sale of a convertible promissory note and warrant. As a result, we issued convertible notes with a total principal balance of $25,000 and warrants to purchase 500,000 shares of common stock at an exercise price of $0.0125 per share. The convertible promissory note has a relative fair value of $19,455 and the warrants has a relative fair value of $5,545 at the date of issuance determined using the Black-Scholes option-pricing model. The assumptions used to calculate the fair market value are as follows: (i) risk-free interest rate of 1.05% (ii) estimated volatility of 221% (iii) dividend yield of 0.00% and (iv) expected life of the warrants of 3 years. The Convertible Note carries an original issue discount of 10%, mature on March 16, 2017 with a 12% interest rate and are convertible into common stock of the Company at 60% of the lowest closing price over a five day period immediately prior to but not including the Conversion Date. However, the conversion price shall not be lower than $0.005 per share.

On April 15, 2016, the Company entered into an Exchange Agreement (the “Exchange Agreement”) and a Lock-Up Agreement (the “Lock-Up Agreement”) with a private investor (the “Investor”). Pursuant to the Exchange Agreement, the Company agreed to issue the Investor two promissory notes in the amount of $234,619 and $29,327 (the “Notes”), respectively, in exchange for a 7.5% Convertible Debenture purchased by the Investor from a third party (the “Original Note”). The Company has also granted the Investor a right of first refusal on all future Company financings over the next twelve months. Via the Exchange Agreement, the Company was able to extend the maturity dates of the Notes to May 10, 2016 and October 15, 2016, respectively. Pursuant to the Lock-Up Agreement, the Investor has agreed not to sell any shares acquired from conversion of the Note until May 10, 2016. The convertible notes are convertible into shares of common stock at 49% of the lowest traded price in the prior thirty trading days. As a result of the Exchange Agreement, we recognized a loss on extinguishment of debt of $29,327. 

On April 18, 2016, the Company entered into a Loan Agreement with a private investor in connection with a bridge financing transaction, consisting of an Unsecured Convertible Promissory Note in principal amount of $25,000 and three-year warrants to purchase 500,000 shares of the Company’s common stock with an exercise price of $0.0125 per share. The convertible promissory note has a relative fair value of $20,872 and the warrants has a relative fair value of $4,128 at the date of issuance determined using the Black-Scholes option-pricing model. The assumptions used to calculate the fair market value are as follows: (i) risk-free interest rate of 0.90% (ii) estimated volatility of 215% (iii) dividend yield of 0.00% and (iv) expected life of the warrants of 3 years. The Convertible Note carries an original issue discount of 10%, mature on April 14, 2017 with a 12% interest rate and are convertible into common stock of the Company at 60% of the lowest closing price over a five day period immediately prior to but not including the Conversion Date. However, the conversion price shall not be lower than $0.005 per share.

On May 6, 2016, the Company entered into a Note Purchase Agreement with an unaffiliated third party (the “Investor”) relating to the sale of an unsecured convertible promissory note. The third party purchased an additional unit for $25,000 and a principal balance of $30,000. The convertible promissory note is divided into units (“Units”), each in the principal amount of $25,000, with equal installments of $1,000 due sequentially every week until $30,000 has been repaid. The convertible promissory notes are due on December 2, 2016, subject to certain conditions and restrictions set forth in the notes. The convertible note is convertible into shares of common stock based on the volume weighted average of the closing price per share for the 20 consecutive trading days prior to the conversion date if there is any outstanding principal balance due after the expiration due date. On June 14, 2016, we consolidated all of these Investor’s notes into a single note valued at $120,000. The note is due December 16, 2016 and carries an OID of 20%.

On May 10, 2016, we issued a total of 8,201,811 shares of common stock to two investors upon the conversion of $50,000 in debt from Convertible Notes that were issued in the first quarter of 2015 and the second quarter of 2016.

On June 7, 2016, we issued a total of 6,500,000 shares of common stock to an investor upon the conversion of $23,888 in debt from a Convertible Note that was issued in the second quarter of 2016.

On June 14, 2016, we received $45,000 from a noteholder who consolidated the remaining balance of $55,000 in notes into a $100,000 convertible note with an OID of 20%. The convertible note matures on December 16, 2016, without interest, and is convertible into common stock of the Company at the lowest traded price in the 5 days prior to the conversion. The noteholder will received 2,000,000 shares of common stock for the origination of this loan. These shares were issued on August 5, 2016.

On June 28, 2016, a noteholder assigned his remaining balance of $60,000 to another investor who consolidated it with that investor’s $40,000 convertible note. The new convertible note matures on December 31, 2016, without interest, and is convertible into common stock of the Company at the lower of 49% of the lowest traded price in the prior 30 days or $0.005 per share. On July 25, 2016, the noteholder converted their outstanding principal balance into 16,773,833 shares of common stock at a conversion price of $0.003577 per share.

On July 8, 2016, we raised $150,000 related to a Warrant and Note Purchase Agreement with unaffiliated third parties (the “Investors”) relating to the sale of unsecured convertible promissory notes. The promissory notes are divided into units (“Units”), each in the principal amount of $31,500. The Convertible Note carries an original issue discount of 26%, mature on December 31, 2017 and are convertible into common stock of the Company at $0.015 per share, subject to adjustment and mandatory conversion. On July 8, 2016, the Investors had purchased the minimum raise required of six $25,000 Units (for a total of $150,000). The Agreement comes with two 3-year warrants, one to purchase 1,050,000 shares of common stock at $0.015 per share and the other to purchase 525,000 shares of common stock at $0.03 per share. The convertible promissory notes have a relative fair value of $134,019 and the warrants have a relative fair value of $54,981 at the date of issuance determined using the Black-Scholes option-pricing model. The assumptions used to calculate the fair market value are as follows: (i) risk-free interest rate of 0.71% (ii) estimated volatility of 200% (iii) dividend yield of 0.00% and (iv) expected life of the warrants of 3 years.

On July 10, 2016, we issued a total of 5,000,000 shares of common stock to an investor for converting $17,885 in debt from a Convertible Note that closed in the first quarter of 2016.

On August 3, 2016, we issued a total of 5,000,000 shares of common stock to an investor for converting $19,845 in debt from a Convertible Note that closed in the first quarter of 2016.

On August 16 2016, we issued a total of 2,500,000 shares of common stock to an investor for converting $10,168 in debt from a Convertible Note that closed in the first quarter of 2016.

On August 26, 2016, we issued a total of 5,000,000 shares of common stock to an investor for converting $19,600 in debt from a Convertible Note that closed in the first quarter of 2016.

On September 19, 2016, we issued a total of 10,000,000 shares of common stock to an investor for converting $30,380 in debt from a Convertible Note that closed in the first quarter of 2016. 

Derivative liabilities

The conversion features embedded in the convertible notes were evaluated to determine if such conversion feature should be bifurcated from its host instrument and accounted for as a freestanding derivative. In the convertible notes with variable conversion terms, the conversion feature was accounted for as a derivative liability. The derivatives associated with the term convertible notes were recognized as a discount to the debt instrument and the discount is amortized over the expected life of the notes with any excess of the derivative value over the note payable value recognized as additional interest expense at the issuance date. Amortization of the debt discount totaled $623,675 and $0 during the periods ended September 30, 2016 and 2015, respectively.

The derivative liability was calculated using the Black Scholes method over the expected terms of the convertible debentures, with a risk free rate of 2% and volatility of 107% as of September 30, 2016. Included in Derivative Income in the accompanying consolidated statements of operations is income arising from the change in fair value of the derivatives of $537,738 and $13,490 during the periods ended September 30, 2016 and 2015, respectively.

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Equity

9 Months Ended

Sep. 30, 2016

Equity [Abstract]

Equity

6.       EQUITY

Common Stock

On January 20, 2016, we issued 5,921,592 shares of common stock (valued at $45,000) to reduce accrued management salaries and 1,500,000 shares of common stock (valued at $11,400) various consultants and accredited investors.

On February 5, 2016, an accredited investor with a convertible note of $30,000, converted their outstanding principal balance into 2,000,000 shares of common stock at a conversion price of $0.015 per share and was issued an additional 250,000 shares of common stock at a price of $0.015 per share.

On March 3, 2016, we issued 4,250,000 shares of common stock (valued at $55,250) to 3 advisors for services rendered.

On March 16, 2016, we hired Greentree Financial Group to assist with financial matters throughout 2016. We are compensating Greentree Financial for their services with 2,500,000 shares of common stock (valued at $25,000) that we issued in March 2016 in connection with their engagement.

On May 4, 2016, we issued 4,250,000 shares of common stock (valued at $42,500) to 5 various consultants.

On May 10, 2016, we issued 3,000,000 shares of common stock (valued at $30,000) to reduce accrued management salaries and 1,250,000 shares of common stock (valued at $12,500) to 5 board of directors for their services.

On May 10, 2016, we issued a total of 8,201,811 shares of common stock to two investors for converting $50,000 in debt from Convertible Notes that was issued in the first quarter of 2015 and the second quarter of 2016.

On June 7, 2016, we issued a total of 6,500,000 shares of common stock to an investor for converting $23,888 in debt from a Convertible Note that was issued in second quarter of 2016.

On July 10, 2016, we issued a total of 5,000,000 shares of common stock to an investor for converting $17,885 in debt from a Convertible Note that closed in the first quarter of 2016.

On July 25, 2016, we issued a total of 16,773,833 shares of common stock to an investor for converting $60,000 in debt from a Convertible Note that closed in the first quarter of 2015.

On August 3, 2016, we issued a total of 5,000,000 shares of common stock to an investor for converting $19,845 in debt from a Convertible Note that closed in the first quarter of 2016.

On August 5, 2016, we issued 10,800,000 shares of common stock (valued at $86,400) to five consultants for services performed.

On August 16 2016, we issued a total of 2,500,000 shares of common stock to an investor for converting $10,168 in debt from a Convertible Note that closed in the first quarter of 2016.

On August 26, 2016, we issued a total of 5,000,000 shares of common stock to an investor for converting $19,600 in debt from a Convertible Note that closed in the first quarter of 2016.

On September 15, 2016, we issued 1,500,000 shares of common stock (valued at $12,000) to reduce accrued management salaries and 1,000,000 shares of common stock (valued at $8,000) to 4 board of directors for their services.

On September 15, 2016, we issued 750,000 shares of common stock (valued at $6,000) to two consultants for services performed.

On September 19, 2016, we issued a total of 10,000,000 shares of common stock to an investor for converting $30,380 in debt from a Convertible Note that closed in the first quarter of 2016.

The Company issued the following shares of common stock during the nine months ended September 30, 2016:

	Value of Shares		Number of Shares
Shares issued for services rendered	$	254,300		26,550,000
Shares issued for accrued expenses		87,000		10,421,592
Shares issued for conversion of debt		262,094		60,975,644
Total	$	603,394		97,947,236

Shares issued for services rendered were to various members of management, the Board of Directors, employees and consultants and are expensed as Stock-Based Compensation in the accompanying consolidated statement of operations. Shares issued for conversion of debt relate to conversion of the convertible notes discussed in Note 4.

Common Stock Warrants

Since inception, the Company has issued warrants to purchase shares of the Company’s common stock to shareholders, consultants and employees as compensation for services rendered and/or through private placements.

On January 27, 2016, 1,250,000 warrants were issued to an accredited investor as part of their Note and Share Purchase Agreement. The warrants expire on February 26, 2018 at an exercise price of $0.015.

On March 16, 2016, 3,000,000 warrants were issued to two accredited investors as part of their Loan Agreements. The warrants expire on March 16, 2019 at an exercise price of $0.0125.

On April 18, 2016, 500,000 warrants were issued to an accredited investor as part of the Note and Share Purchase Agreement. The warrant expires on April 18, 2019 at an exercise price of $0.0125.

On May 6, 2016, 1,250,000 warrants were issued to an accredited investor as part of the Note and Share Purchase Agreement. The warrant expires on December 16, 2018 at an exercise price of $0.015.

On May 16, 2016, 3,300,000 warrants were issued to consultant as part of their Advisory Services Agreement. The warrants expire on May 16, 2019 at an exercise price of $0.015.

On July 1, 2016, 4,200,000 series “A” warrants and 2,100,000 series “B” warrants were issued to an accredited investor as part of the Note and Warrant Purchase Agreement. The series A and B warrants expires on July 1, 2019 at an exercise price of $0.015 for the series A and $0.030 for the series B warrants.

On July 8, 2016, 2,100,000 series “A” warrants and 1,050,000 series “B” warrants were issued to two accredited investors as part of the Note and Warrant Purchase Agreement. The series A and B warrants expires on July 8, 2019 at an exercise price of $0.015 for the series A and $0.030 for the series B warrants.

A summary of the Company’s warrant activity and related information is provided below:

	Exercise Price $		Number of Warrants
Outstanding and exercisable at December 31, 2015		0.015 - 0.02		11,150,000
Warrants exercised		-		-
Warrants granted		0.0125 - 0.03		18,750,000
Warrants expired		-		-
Outstanding and exercisable at September 30, 2016		0.0125 - 0.03		29,900,000

Stock Warrants as of September 30, 2016
Exercise		Warrants		Remaining		Warrants
Price		Outstanding		Life (Years)		Exercisable
$	0.020		9,900,000		1.32		9,900,000
$	0.015		13,350,000		2.35		13,350,000
$	0.0125		3,500,000		2.50		3,500,000
$	0.030		3,150,000		2.77		3,150,000

Common Stock Options

Under the Company’s 2008 Equity Compensation Plan (the “2008 Plan”), we are authorized to grant stock options intended to qualify as Incentive Stock Options, “ISO”, under Section 422 of the Internal Revenue Code of 1986, as amended, non-qualified options, restricted and unrestricted stock awards and stock appreciation rights to purchase up to 7,000,000 shares of common stock to our employees, officers, directors and consultants, with the exception that ISOs may only be granted to employees of the Company and its subsidiaries, as defined in the 2008 Plan. After adjusting for expired and estimated pre-vesting forfeitures, options for approximately 2,235,000 shares were still available for grant under the 2008 Plan as of September 30, 2016.

Stock option activity under the 2008 Plan for the nine months ended September 30, 2016 is summarized as follows:

	Shares			Weighted Average Exercise Price		Weighted Average Remaining Contractual Life (in years)		Grant Date Fair Value
Outstanding at December 31, 2015		452,493		$	0.08		0.84	$	46,901
Options granted		-			-		-		-
Options exercised		-			-		-		-
Options cancelled/ forfeited/ expired		(452,493	)		-		-		(46,901	)
Outstanding at September 30, 2016		-		$	-		-	$	-

The Company recognizes option expense ratably over the vesting periods. As all outstanding options had vested as of December 31, 2012, we have recognized no compensation expense related to options granted under the 2008 Plan during the nine months ended September 30, 2016 and 2015, however these options did expire after their 3 year period.

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Subsequent Events

9 Months Ended

Sep. 30, 2016

Subsequent Events [Abstract]

Subsequent Events

7.       SUBSEQUENT EVENTS

On October 14, 2016, we issued a total of 2,400,000 shares of common stock to an investor upon the conversion of $12,000 in debt from a Convertible Note that closed in the first quarter of 2016.

On October 28, 2016, we issued a total of 4,000,000 shares of common stock to an investor upon the conversion of $20,000 in debt from a Convertible Note that closed in the first quarter of 2016.

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Significant Accounting Policies (Policies)

9 Months Ended

Sep. 30, 2016

Accounting Policies [Abstract]

Use of Estimates

Use of Estimates

The preparation of the accompanying unaudited consolidated financial statements requires the use of estimates that affect the reported amounts of assets, liabilities, revenues, expenses and contingencies. These estimates include, but are not limited to, estimates related to revenue recognition, allowance for doubtful accounts, inventory valuation, tangible and intangible long-term asset valuation, warranty and other obligations and commitments. Estimates are updated on an ongoing basis and are evaluated based on historical experience and current circumstances. Changes in facts and circumstances in the future may give rise to changes in these estimates which may cause actual results to differ from current estimates.

Fair Value Estimates

Fair Value Estimates

Pursuant to the Accounting Standards Codification (“ASC”) No. 820, “Disclosures About Fair Value of Financial Instruments”, the Company records its financial assets and liabilities at fair value. ASC No. 820 provides a framework for measuring fair value, clarifies the definition of fair value and expands disclosures regarding fair value measurements. Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability (an exit price) in an orderly transaction between market participants at the reporting date. ASC No. 820 establishes a three-tier hierarchy, which prioritizes the inputs used in the valuation methodologies in measuring fair value:

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

Level 2—Inputs (other than quoted prices included in Level 1) are either directly or indirectly observable for the asset or liability through correlation with market data at the measurement date and for the duration of the asset/liability’s anticipated life.

Level 3—Inputs reflect management’s best estimate of what market participants would use in pricing the asset or liability at the measurement date. Consideration is given to the risk inherent in the valuation technique and the risk inherent in the inputs to the model.

The carrying values for cash and cash equivalents, accounts receivable, other current assets, accounts payable and accrued liabilities approximate their fair value due to their short maturities.

Equity Securities

Equity Securities

During the second quarter of fiscal 2016, we received restricted equity securities, which we have classified as “available for sale” securities. Our equity securities are marked to market on a quarterly basis, with unrealized gains and losses being excluded from earnings and reflected as a component of other comprehensive income.

The inputs or methodology used for valuing securities are not necessarily an indication of the risk associated with investing in those securities.

Following are the disclosures related to our financial assets pursuant to ASC No. 820:

	September 30, 2016
	Fair Value		Input Level
Available for sale marketable securities:
Common stock	$	63,325		Level 1

The fair value of our available for sale securities is determined based on quoted market prices for identical securities on a quarterly basis.

Derivative Instruments

Derivative Instruments

Our debt or equity instruments may contain embedded derivative instruments, such as conversion options, which in certain circumstances may be required to be bifurcated from the associated host instrument and accounted for separately as a derivative instrument liability.

Our derivative instrument liabilities are re-valued at the end of each reporting period, with changes in the fair value of the derivative liability recorded as charges or credits to income, in the period in which the changes occur. For bifurcated conversion options that are accounted for as derivative instrument liabilities, we determine the fair value of these instruments using the Black-Scholes option pricing model. This model requires assumptions related to the remaining term of the instrument and risk-free rates of return, our current Common Stock price and expected dividend yield, and the expected volatility of our Common Stock price over the life of the option.

Reclassifications

Reclassifications

For comparability, certain prior period amounts have been reclassified, where appropriate, to conform to the financial statement presentation used in 2016. These reclassifications have no impact on net loss.

Recently Issued Accounting Pronouncements

Recently Issued Accounting Pronouncements

The Financial Accounting Standards Board has recently issued accounting pronouncements, most of which represent technical corrections to the accounting literature or application to specific industries, which are not expected to have a material impact on the Company’s financial position, results of operations or cash flows. We do not believe that the adoption of any recently issued accounting standards will have a material effect on our financial position and results of operations.

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Significant Accounting Policies (Tables)

9 Months Ended

Sep. 30, 2016

Investments, Debt and Equity Securities [Abstract]

Schedule of Marketable Securities

Following are the disclosures related to our financial assets pursuant to ASC No. 820:

	September 30, 2016
	Fair Value		Input Level
Available for sale marketable securities:
Common stock	$	63,325		Level 1

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Debt (Tables)

9 Months Ended

Sep. 30, 2016

Debt Disclosure [Abstract]

Schedule of Short-term Borrowings

	September 30, 2016			December 31, 2015
Q4 2014 Convertible Notes	$	126,000		$	126,000
Q1 2015 Convertible Notes		60,000			150,000
Q2 2015 Convertible Notes		200,000			200,000
Q3 2015 Convertible Notes		45,000			84,000
Q4 2015 Convertible Notes		-			196,250
Q1 2016 Convertible Notes		140,000			-
Q2 2016 Convertible Notes		302,181			-
Q3 2016 Convertible Notes		507,671			-
Total convertible notes		1,380,852			756,250
Less: Debt discount		(279,303	)		-
Convertible notes, net of debt discount		1,101,549			756,250
Current portion of convertible notes	$	626,303		$	556,250
Long-term convertible notes	$	475,246		$	200,000

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Equity (Tables)

9 Months Ended

Sep. 30, 2016

Equity [Abstract]

Schedule of Company Issued Shares of Common Stock

The Company issued the following shares of common stock during the nine months ended September 30, 2016:

	Value of Shares		Number of Shares
Shares issued for services rendered	$	254,300		26,550,000
Shares issued for accrued expenses		87,000		10,421,592
Shares issued for conversion of debt		262,094		60,975,644
Total	$	603,394		97,947,236

Schedule of Warrant Activity

A summary of the Company’s warrant activity and related information is provided below:

	Exercise Price $		Number of Warrants
Outstanding and exercisable at December 31, 2015		0.015 - 0.02		11,150,000
Warrants exercised		-		-
Warrants granted		0.0125 - 0.03		18,750,000
Warrants expired		-		-
Outstanding and exercisable at September 30, 2016		0.0125 - 0.03		29,900,000

Schedule of Stock Warrant Exercise Price Range

Stock Warrants as of September 30, 2016
Exercise		Warrants		Remaining		Warrants
Price		Outstanding		Life (Years)		Exercisable
$	0.020		9,900,000		1.32		9,900,000
$	0.015		13,350,000		2.35		13,350,000
$	0.0125		3,500,000		2.50		3,500,000
$	0.030		3,150,000		2.77		3,150,000

Schedule of Stock Option Activity Under the Plan

Stock option activity under the 2008 Plan for the nine months ended September 30, 2016 is summarized as follows:

	Shares			Weighted Average Exercise Price		Weighted Average Remaining Contractual Life (in years)		Grant Date Fair Value
Outstanding at December 31, 2015		452,493		$	0.08		0.84	$	46,901
Options granted		-			-		-		-
Options exercised		-			-		-		-
Options cancelled/ forfeited/ expired		(452,493	)		-		-		(46,901	)
Outstanding at September 30, 2016		-		$	-		-	$	-

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Organization and Basis of Presentation (Details Narrative) - USD ($)	3 Months Ended		9 Months Ended
	Sep. 30, 2016	Sep. 30, 2015	Sep. 30, 2016	Sep. 30, 2015	Dec. 31, 2015	Feb. 28, 2015
Net loss	$ (175,462)	$ (266,686)	$ (813,771)	$ 889,948
Accumulated deficit	19,332,834		19,332,834		$ 18,519,063
Working capital	$ 1,061,331		$ 1,061,331
LOCiMOBILE, Inc [Member]
Capital stock ownership, percent						100.00%
Code Amber News Service, Inc [Member]
Capital stock ownership, percent						100.00%

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Significant Accounting Policies - Schedule of Marketable Securities (Details) - USD ($)	Sep. 30, 2016	Dec. 31, 2015
Common stock	$ 453,378	$ 355,431
Fair Value, Inputs, Level 1 [Member] | Available-for-sale Securities [Member]
Common stock	$ 63,325

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Joint Venture and Investment In Equity Securities (Details Narrative)	9 Months Ended
	Sep. 30, 2016 USD ($) Integer $ / shares shares
Equity method investment in the subsidiary	$ 0
Inventergy Innovations, LLC [Member]
Investment interest rate	45.00%
Number of monthly payments | Integer	5
Number of common shares owned | shares	42,500
Common stock closing price, per share | $ / shares	$ 1.49
Owned shares of common shares value	$ 63,325
Inventergy Innovations, LLC [Member] | December 2016 [Member]
Inventory payment	$ 25,000

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Related Party Transactions (Details Narrative) - USD ($)	9 Months Ended
	Sep. 30, 2016	Jan. 15, 2016	Dec. 31, 2015
Accrued wages	$ 295,131		$ 291,451
Convertible promissory notes due date	Dec. 31, 2018
Converted salaries	$ 318,671
Convertible interest rate	10.00%	7.50%
Option Warrant [Member]
Common or preferred stock , per share	$ 0.01
Maximum [Member]
Convertible interest rate	50.00%

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Debt (Details Narrative) - USD ($)																						1 Months Ended		3 Months Ended		9 Months Ended
	Sep. 19, 2016	Sep. 14, 2016	Aug. 26, 2016	Aug. 16, 2016	Aug. 03, 2016	Jul. 25, 2016	Jul. 10, 2016	Jul. 08, 2016	Jul. 07, 2016	Jun. 28, 2016	Jun. 20, 2016	Jun. 14, 2016	Jun. 07, 2016	May 10, 2016	May 06, 2016	Apr. 18, 2016	Apr. 15, 2016	Feb. 08, 2016	Feb. 05, 2016	Feb. 05, 2016	Jan. 15, 2016	Mar. 16, 2016	Jan. 27, 2016	Sep. 30, 2016	Sep. 30, 2015	Sep. 30, 2016	Sep. 30, 2015
Convertible debt accredited investor periodic payment																				$ 30,000	$ 15,000					$ 23,000
Convertible interest rate																					7.50%			10.00%		10.00%
Convertible promissory principle payment										$ 60,000		$ 45,000
Common stock exercise price, per share																			$ 0.015	$ 0.015
Convertible promissory notes due date																										Dec. 31, 2018
Debt converted into outstanding shares						16,773,833													250,000	2,250,000
Common stock at a conversion price						$ 0.003577													$ 0.015	$ 0.015
Loss on extinguishment of debt																								$ 250	$ (137,250)	$ 29,577	$ (105,192)
Number of common stock shares issued											5,921,592								2,000,000							97,947,236
Debt conversion convertible amount																			$ 30,000							$ 262,094	342,232
Amortization of the debt discount																								$ (213,964)		(623,675)
Derivative (income) expense, net																										$ (537,738)	(13,490)
Derivative Liabilities [Member]
Fair value assumptions, risk free interest rate																										2.00%
Fair value assumptions, expected volatility rate																										107.00%
Amortization of the debt discount																										$ 584,973	$ 0
Convertible Promissory Note [Member]
Convertible debt accredited investor periodic payment																										5,000
Fair value of warrant																							$ 23,899			$ 6,101
Fair value assumptions, risk free interest rate																										0.88%
Fair value assumptions, expected volatility rate																										171.00%
Fair value assumptions, expected dividend rate																										0.00%
Convertible Promissory Note [Member] | Warrant [Member]
Fair value assumptions, expected life																										25 months
Convertible Note [Member]
Convertible interest rate												20.00%
Convertible promissory principle payment										$ 40,000		$ 55,000
Convertible promissory notes due date										Dec. 31, 2016		Dec. 16, 2016
Common stock at a conversion price										$ 0.005
Convertible debt lowest closing price										49.00%
Number of common stock shares issued												2,000,000
Debt conversion convertible amount												$ 100,000
Investor [Member]
Convertible interest rate		20.00%
Convertible promissory principle payment		$ 120,000
Convertible promissory notes due date		Dec. 16, 2016
Number of common stock shares issued	10,000,000		5,000,000	2,500,000	5,000,000	16,773,833	5,000,000		6,500,000				6,500,000
Debt conversion convertible amount	$ 30,380		$ 19,600	$ 10,168	$ 19,845	$ 60,000	$ 17,885		$ 23,888				$ 23,888
Two Investors [Member]
Number of common stock shares issued														8,201,811
Debt conversion convertible amount														$ 50,000
Note Purchase Agreement [Member]
Convertible debt accredited investor periodic payment																							1,000
Convertible promissory principle payment																							30,000
Repayments of debt																							$ 30,000
Warrants to purchase, shares																							1,250,000
Common stock exercise price, per share																							$ 0.015
Convertible promissory notes due date																							Nov. 25, 2016
Note Purchase Agreement [Member] | Convertible Promissory Note [Member]
Convertible debt accredited investor periodic payment															$ 1,000
Convertible interest rate												20.00%
Convertible promissory principle payment												$ 120,000			25,000
Repayments of debt															$ 30,000
Convertible promissory notes due date												Dec. 16, 2016			Dec. 02, 2016
Note Purchase Agreement [Member] | Unsecured Convertible Promissory Note [Member]
Due to related parties payment															$ 25,000
Convertible promissory principle payment															$ 30,000
Note Purchase Agreement [Member] | Investor [Member]
Due to related parties payment																							$ 25,000
Convertible promissory principle payment																							$ 30,000
Note and Share Purchase Agreement [Member]
Warrants to purchase, shares															1,250,000	500,000							1,250,000
Common stock exercise price, per share															$ 0.015	$ 0.0125							$ 0.015
Note and Share Purchase Agreement [Member] | Convertible Promissory Note [Member]
Convertible promissory principle payment																		$ 30,000
Convertible promissory notes due date																		Dec. 31, 2016
Common stock at a conversion price																		$ 0.01
Note and Share Purchase Agreement [Member] | Convertible Promissory Note [Member] | Unit One [Member]
Investor purchased units																		$ 25,000
Note and Share Purchase Agreement [Member] | Convertible Promissory Note [Member] | Unit Two [Member]
Investor purchased units																		$ 25,000
Loan Agreement [Member]
Warrants to purchase, shares																						3,000,000
Common stock exercise price, per share																						$ 0.0125
Loan Agreement [Member] | Convertible Promissory Note One [Member]
Convertible interest rate																						12.00%
Convertible promissory principle payment																						$ 55,000
Warrants to purchase, shares																						2,500,000
Common stock exercise price, per share																						$ 0.0125
Fair value of warrant																						$ 33,379
Fair value of warrant issuance cost																						$ 21,621
Fair value assumptions, risk free interest rate																						1.05%
Fair value assumptions, expected volatility rate																						221.00%
Fair value assumptions, expected dividend rate																						0.00%
Fair value assumptions, expected life																						3 years
Convertible debt original issue discount																						10.00%
Convertible debt original, mature date																						Mar. 16, 2017
Convertible debt lowest closing price																						60.00%
Convertible debt of conversion date																						5 days
Loan Agreement [Member] | Convertible Promissory Note One [Member] | Minimum [Member]
Common stock at a conversion price																						$ 0.005
Loan Agreement [Member] | Convertible Promissory Note Two [Member]
Convertible interest rate																12.00%						12.00%
Convertible promissory principle payment																$ 25,000						$ 25,000
Warrant term																3 years
Warrants to purchase, shares																500,000						500,000
Common stock exercise price, per share																$ 0.0125						$ 0.0125
Fair value of warrant																$ 20,872						$ 19,455
Fair value of warrant issuance cost																$ 4,128						$ 5,545
Fair value assumptions, risk free interest rate																0.90%						1.05%
Fair value assumptions, expected volatility rate																215.00%						221.00%
Fair value assumptions, expected dividend rate																0.00%						0.00%
Fair value assumptions, expected life																3 years						3 years
Convertible debt original issue discount																10.00%						10.00%
Convertible debt original, mature date																Apr. 14, 2017						Mar. 16, 2017
Convertible debt lowest closing price																60.00%						60.00%
Convertible debt of conversion date																5 days						5 days
Loan Agreement [Member] | Convertible Promissory Note Two [Member] | Minimum [Member]
Common stock at a conversion price																$ 0.005						$ 0.005
Exchange Agreement [Member] | Convertible Promissory Note [Member]
Notes maturity dates, description																	May 10, 2016 and October 15, 2016
Convertible debt lowest closing price																	49.00%
Loss on extinguishment of debt																	$ 29,327
Exchange Agreement [Member] | Convertible Promissory Note One [Member]
Convertible interest rate																	7.50%
Convertible promissory principle payment																	$ 29,327
Exchange Agreement [Member] | Convertible Promissory Note Two [Member]
Convertible interest rate																	7.50%
Convertible promissory principle payment																	$ 234,619
Warrant and Note Purchase Agreement [Member]
Convertible promissory principle payment								$ 150,000
Warrant and Note Purchase Agreement [Member] | Unsecured Convertible Promissory Note [Member]
Convertible promissory principle payment								$ 31,500
Warrant term								3 years
Warrants to purchase, shares								525,000
Common stock exercise price, per share								$ 0.03
Convertible promissory notes due date								Dec. 31, 2017
Fair value of warrant								$ 134,019
Fair value of warrant issuance cost								$ 54,981
Fair value assumptions, risk free interest rate								0.71%
Fair value assumptions, expected volatility rate								200.00%
Fair value assumptions, expected dividend rate								0.00%
Fair value assumptions, expected life								3 years
Common stock at a conversion price								$ 0.015
Investor purchased units								$ 150,000
Convertible debt original issue discount								26.00%
Warrant and Note Purchase Agreement [Member] | Unsecured Convertible Promissory Note [Member] | Unit Six [Member]
Investor purchased units								$ 25,000
Warrant and Note Purchase Agreement One [Member] | Unsecured Convertible Promissory Note [Member]
Warrants to purchase, shares								1,050,000
Common stock exercise price, per share								$ 0.015

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Debt - Schedule of Short-term Borrowings (Details) - USD ($)	Sep. 30, 2016	Dec. 31, 2015
Total convertible notes	$ 1,380,852	$ 756,250
Less: Debt discount	(279,303)
Convertible notes, net of debt discount	1,101,549	756,250
Current portion of convertible notes	626,303	556,250
Long-term convertible notes	475,246	200,000
Q4 2014 Convertible Notes [Member]
Total convertible notes	126,000	126,000
Q1 2015 Convertible Notes [Member]
Total convertible notes	60,000	150,000
Q2 2015 Convertible Notes [Member]
Total convertible notes	200,000	200,000
Q3 2015 Convertible Notes [Member]
Total convertible notes	45,000	84,000
Q4 2015 Convertible Notes [Member]
Total convertible notes		196,250
Q1 2016 Convertible Notes [Member]
Total convertible notes	140,000
Q2 2016 Convertible Notes [Member]
Total convertible notes	302,181
Q3 2016 Convertible Notes [Member]
Total convertible notes	$ 507,671

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Equity (Details Narrative) - USD ($)																								9 Months Ended
	Sep. 19, 2016	Sep. 15, 2016	Aug. 26, 2016	Aug. 16, 2016	Aug. 05, 2016	Aug. 03, 2016	Jul. 25, 2016	Jul. 10, 2016	Jul. 08, 2016	Jul. 07, 2016	Jul. 02, 2016	Jun. 20, 2016	Jun. 07, 2016	May 16, 2016	May 10, 2016	May 06, 2016	May 04, 2016	Apr. 18, 2016	Mar. 16, 2016	Mar. 03, 2016	Feb. 05, 2016	Feb. 05, 2016	Jan. 27, 2016	Sep. 30, 2016	Sep. 30, 2015
Number of common stock issued, shares												5,921,592									2,000,000			97,947,236
Number of common stock, value												$ 45,000												$ 603,394
Debt conversion convertible amount																					$ 30,000			$ 262,094	$ 342,232
Common stock at a conversion price							$ 0.003577														$ 0.015	$ 0.015
Debt converted into outstanding shares							16,773,833														250,000	2,250,000
Common stock exercise price, per share																					$ 0.015	$ 0.015
Number of common stock issued for services, shares		1,500,000													3,000,000
Number of common stock issued for services, value		$ 12,000													$ 30,000
2008 Equity Compensation Plan [Member]
Number of common stock issued, shares																								2,235,000
Number of stock option purchase, shares																								7,000,000
Options expire term																								3 years
Note and Share Purchase Agreement [Member]
Common stock exercise price, per share																$ 0.015		$ 0.0125					$ 0.015
Number of warrant issued, shares																1,250,000		500,000					1,250,000
Warrant expiry date																Dec. 16, 2018		Apr. 18, 2019					Feb. 26, 2018
Loan Agreement [Member]
Common stock exercise price, per share																			$ 0.0125
Number of warrant issued, shares																			3,000,000
Warrant expiry date																			Mar. 16, 2019
Advisory Services Agreement [Member]
Common stock exercise price, per share														$ 0.015
Number of warrant issued, shares														3,300,000
Warrant expiry date														May 16, 2019
Two Investors [Member]
Number of common stock issued, shares															8,201,811
Debt conversion convertible amount															$ 50,000
Investor [Member]
Number of common stock issued, shares	10,000,000		5,000,000	2,500,000		5,000,000	16,773,833	5,000,000		6,500,000			6,500,000
Debt conversion convertible amount	$ 30,380		$ 19,600	$ 10,168		$ 19,845	$ 60,000	$ 17,885		$ 23,888			$ 23,888
Greentree Financial Group [Member]
Number of common stock issued for services, shares																			2,500,000
Number of common stock issued for services, value																			$ 25,000
Three Advisors [Member]
Number of common stock issued for services, shares																				4,250,000
Number of common stock issued for services, value																				$ 55,250
Five Consultants [Member]
Number of common stock issued for services, shares					10,800,000												4,250,000
Number of common stock issued for services, value					$ 86,400												$ 42,500
Five Board of Directors [Member]
Number of common stock issued for services, shares															1,250,000
Number of common stock issued for services, value															$ 12,500
Four Board of Directors [Member]
Number of common stock issued for services, shares		1,000,000
Number of common stock issued for services, value		$ 8,000
Two Consultants [Member]
Number of common stock issued for services, shares		750,000
Number of common stock issued for services, value		$ 6,000
Consultants and Accredited Investors [Member]
Number of common stock issued, shares												1,500,000
Number of common stock, value												$ 11,400
Series A Warrants [Member] | Warrant Purchase Agreement [Member]
Common stock exercise price, per share									$ 0.015		$ 0.015
Number of warrant issued, shares									2,100,000		4,200,000
Warrant expiry date									Jul. 08, 2019		Jul. 01, 2019
Series B Warrants [Member] | Warrant Purchase Agreement [Member]
Common stock exercise price, per share									$ 0.030		$ 0.030
Number of warrant issued, shares									1,050,000		2,100,000
Warrant expiry date									Jul. 08, 2019		Jul. 01, 2019

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Equity - Schedule of Company Issued Shares of Common Stock (Details) - USD ($)			9 Months Ended
	Jun. 20, 2016	Feb. 05, 2016	Sep. 30, 2016
Value of Shares	$ 45,000		$ 603,394
Number of Shares	5,921,592	2,000,000	97,947,236
Shares Issued for Services Rendered [Member]
Value of Shares			$ 254,300
Number of Shares			26,550,000
Shares Issued for Accrued Expenses [Member]
Value of Shares			$ 87,000
Number of Shares			10,421,592
Shares Issued for Conversion of Debt [Member]
Value of Shares			$ 262,094
Number of Shares			60,975,644

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Equity - Schedule of Warrant Activity (Details)	9 Months Ended
	Sep. 30, 2016 $ / shares shares
Warrant Exercise Price, Exercised
Warrant Exercise Price, Expired
Number of Warrants Outstanding and Exercisable, Beginning Balance | shares	11,150,000
Number of Warrants Exercised | shares
Number of Warrants Granted | shares	18,750,000
Number of Warrants Expired | shares
Number of Warrants Outstanding and Exercisable, Ending Balance | shares	29,900,000
Minimum [Member]
Warrant Exercise Price Outstanding and Exercisable, Beginning Balance	$ 0.015
Warrant Exercise Price, Granted	0.0125
Warrant Exercise Price Outstanding and Exercisable, Ending Balance	0.0125
Maximum [Member]
Warrant Exercise Price Outstanding and Exercisable, Beginning Balance	0.02
Warrant Exercise Price, Granted	0.03
Warrant Exercise Price Outstanding and Exercisable, Ending Balance	$ 0.03

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Equity - Schedule of Stock Warrant Exercise Price Range (Details) - Warrant [Member]	9 Months Ended
	Sep. 30, 2016 $ / shares shares
Exercise Price Range One [Member]
Stock Warrants Exercise Price | $ / shares	$ 0.020
Stock Warrants Outstanding	9,900,000
Stock Warrants Remaining Life (Years)	1 year 3 months 26 days
Stock Warrants Exercisable	9,900,000
Exercise Price Range Two [Member]
Stock Warrants Exercise Price | $ / shares	$ 0.015
Stock Warrants Outstanding	13,350,000
Stock Warrants Remaining Life (Years)	2 years 4 months 6 days
Stock Warrants Exercisable	13,350,000
Exercise Price Range Three [Member]
Stock Warrants Exercise Price | $ / shares	$ 0.0125
Stock Warrants Outstanding	3,500,000
Stock Warrants Remaining Life (Years)	2 years 6 months
Stock Warrants Exercisable	3,500,000
Exercise Price Range Four [Member]
Stock Warrants Exercise Price | $ / shares	$ 0.030
Stock Warrants Outstanding	3,150,000
Stock Warrants Remaining Life (Years)	2 years 9 months 7 days
Stock Warrants Exercisable	3,150,000

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Equity - Schedule of Stock Option Activity Under the Plan (Details)	9 Months Ended
	Sep. 30, 2016 USD ($) $ / shares shares
Equity [Abstract]
Shares Outstanding, Beginning Balance | shares	452,493
Shares Outstanding, Options, Granted | shares
Shares Outstanding, Options, Exercised | shares
Shares Outstanding, Options, Cancelled/ Forfeited/ Expired | shares	(452,493)
Shares Outstanding, Ending Balance | shares
Weighted Average Exercise Price Outstanding, Beginning Balance | $ / shares	$ 0.08
Weighted Average Exercise Price Options Outstanding, Granted | $ / shares
Weighted Average Exercise Price Options Outstanding, Exercised | $ / shares
Weighted Average Exercise Price Options Outstanding, Cancelled/ Forfeited/ Expired | $ / shares
Weighted Average Exercise Price Outstanding, Ending Balance | $ / shares
Weighted Average Remaining Contractual Life (in years) Outstanding	10 months 2 days
Grant Date Fair Value Outstanding, Beginning Balance | $	$ 46,901
Grant Date Fair Value Options Cancelled/ Forfeited/ Expired | $	(46,901)
Grant Date Fair Value Outstanding, Ending Balance | $

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Subsequent Events (Details Narrative) - USD ($)													9 Months Ended
	Oct. 28, 2016	Oct. 14, 2016	Sep. 19, 2016	Aug. 26, 2016	Aug. 16, 2016	Aug. 03, 2016	Jul. 25, 2016	Jul. 10, 2016	Jul. 07, 2016	Jun. 07, 2016	Feb. 05, 2016	Feb. 05, 2016	Sep. 30, 2016	Sep. 30, 2015
Number of common stock issued, shares							16,773,833				2,250,000	250,000
Debt conversion convertible amount												$ 30,000	$ 262,094	$ 342,232
Investor [Member]
Debt conversion convertible amount			$ 30,380	$ 19,600	$ 10,168	$ 19,845	$ 60,000	$ 17,885	$ 23,888	$ 23,888
Subsequent Event [Member] | Investor [Member]
Number of common stock issued, shares	4,000,000	2,400,000
Debt conversion convertible amount	$ 20,000	$ 12,000